Question

How can a firm decide what type of organizational structure is best suited for its strategic needs?

Answer 1

The structure of the company is determined by the strategic goals which a company faces. In general there are four criteria for it. The first criteria are the need of control. If the company wants a higher need of control over the company then there should be very close functional control structure.

The criteria are related to the environment in which the company operates. If the environment is like it forces the company to adopt the change then the company should have structure accordingly.

The third criteria are the need of knowledge generation and knowledge sharing. When the company prioritizes need of idea generation and knowledge sharing then matrix organizational structure will work best.

And 4^th criteria are globalization of the business operations. If the company deals into the foreign market then there is the need of coordination between the home country and the other different countries then multination design will be appropriate for the company

So by the way the company can decide that what type of organizational structure is best suited for a strategic need full stop