Organizational structure
Types of organizational structure
An organizational structure defines who reports to whom, how work is grouped and where decisions are made. The common types are the line (hierarchical), line and staff, functional, divisional, matrix, project and flat structures. Most organizations combine two of them. Each guide below explains one type and includes an example chart you can open and edit.
The main structures compared
A quick comparison. Each name leads to a full explainer; the last column opens the example chart in the editor.
| Structure | In one line | Best for | Example |
|---|---|---|---|
| Hierarchical structure | Every person has exactly one manager, and authority runs top-down in a single chain. | Small and mid-sized organizations with stable, routine work | Open example |
| Line and staff | A line structure plus specialist staff roles that advise managers but give no orders. | Growing companies that need legal, quality or strategy expertise at the top | Open example |
| Functional structure | Departments are formed around functions such as finance, operations, marketing and HR. | Companies with one main product or service | Open example |
| Divisional structure | Semi-independent divisions by product, region or customer group, each with its own functions. | Larger companies with distinct markets or product lines | Open example |
| Matrix organization | People report to a functional manager and, by a dotted line, to a product or project manager. | Organizations running several products or projects on shared specialists | Open example |
| Project organization | A temporary structure with a sponsor, a project manager and workstreams, set up for one goal. | Time-bound initiatives such as a system rollout or a construction project | Open example |
| Flat structure | Few or no middle managers, so most people report directly to one leader. | Start-ups and small expert teams | Open example |
Explainers with a live example chart
- Hierarchical structure (line organization)Every person has exactly one manager, and authority runs top-down in a single chain.Read the explainer
- Line and staff organizationA line structure plus specialist staff roles that advise managers but give no orders.Read the explainer
- Functional organizational structureDepartments are formed around functions such as finance, operations, marketing and HR.Read the explainer
- Divisional organizational structureSemi-independent divisions by product, region or customer group, each with its own functions.Read the explainer
- Matrix organizational structurePeople report to a functional manager and, by a dotted line, to a product or project manager.Read the explainer
- Project organization structureA temporary structure with a sponsor, a project manager and workstreams, set up for one goal.Read the explainer
- Flat organizational structureFew or no middle managers, so most people report directly to one leader.Read the explainer
How to choose a structure
Start from the work, not from the chart. Ask three questions: what do we sell or deliver (one thing or several), how much do teams depend on each other's specialists, and how fast do decisions need to be made close to the customer?
A single product with stable demand points to a line or functional structure. Several products or regions with different customers point to divisions. Specialists that are shared across many products or projects point to a matrix, and a fixed-term goal points to a project organization on top of the existing structure.
- Under about 20 people: a flat or simple line structure is usually enough.
- One product, growing headcount: functional departments, possibly with staff roles for legal, quality or finance.
- Distinct markets or product lines: divisional, with shared central services.
- Many parallel projects on shared experts: a matrix, with clear rules on who decides what.
Structure and org chart are not the same thing
The structure is the set of reporting lines and groupings; the org chart is the drawing of it. A good chart makes the structure readable: one box per position, solid lines for the direct manager, a dotted line for a secondary manager, and staff roles placed beside the manager they advise rather than in the team below.
Most real charts mix types. A functional company may run one product as a matrix, or set up a project organization for a year. Draw what is actually true today, and keep it up to date when people join, leave or move.
Frequently asked questions
What are the main types of organizational structure?
The classic types are line (hierarchical), line and staff, functional, divisional and matrix. Project organizations and flat structures are often added. German textbooks also list the multi-line system based on Taylor's functional foremanship.
Which organizational structure is best?
None is best in general. A structure fits when it matches the work: a single product suits a functional structure, distinct markets suit divisions, and many projects sharing specialists suit a matrix. Most organizations combine types.
What is the difference between a hierarchical and a flat structure?
A hierarchical structure has several management levels, with each manager leading a small group. A flat structure removes most middle levels, so one leader has many direct reports and decisions sit closer to the people doing the work.
How do I show a matrix or a staff position in an org chart?
Draw the main reporting line as a solid line and the second manager as a dotted line. Place staff positions beside the manager they support. In mivochart, both are settings in a person's details.
Draw your own structure
Start with an empty chart or one of the examples above, add people with a click, and choose a manager for each person. Staff positions, dotted lines, open positions and working time (FTE) are built in.