Business organisational structure

An organisational structure sets out roles, responsibilities and authority in a business. It also shows how information moves between different levels of management.

Every business, from a sole trader to a large company, has a structure. A business can be organised by function, location, product or project. It can also use a hierarchical, flat or matrix structure. Having a clear structure can help a business work better and achieve its goals.

This guide explains the different types of organisational structure and the advantages and disadvantages of each. It also describes some of the main reasons for changing your organisational structure.

Organisational structure is different from a legal structure, which relates to business ownership. See legal structures: the basics.