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Advantages of Hybrid Organizational Structures

by
author image Laura Acevedo
Laura Acevedo has been a professional writer for more than 15 years. With a background in business, international relations, psychology and technology, Acevedo writes from both experience and an educational foundation. She holds a Master of Business Administration from the University of North Florida and undergraduate degrees in business and psychology.
Advantages of Hybrid Organizational Structures
Business colleagues gathered around a conference table. Photo Credit Creatas/Creatas/Getty Images

Overview

The organizational structure of a business often dictates the chain of command and responsibility within a company or group. Organizational design can designate the number of reporting relationships, management level depth and the allocation of responsibilities and duties. Hybrid organizational structures combine two or more traditional organizational design formats based on strategy and business needs. Organizational formats that you can combine include simple, functional, geographic and matrix, according to the World Bank.

Speed

Organizations with too many layers of management, reporting or decision making can decrease the speed of business progress and can make a company uncompetitive. You can streamline your business by using a hybrid organizational structure to interject a chain of command that maximizes speed and efficiency, while adding extra management oversight where needed. For example, you may need a functional organizational structure for accounting or finance personnel to maintain checks and balances, and a geographic structure to provide support and product customization for different continents.

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Minimize Complexity

Multinational corporations, mergers and multiple business units can make management cumbersome and difficult. Dividing management responsibilities by logical business divisions based on the type and function of each portion of the business can minimize the complexity. Managers will be responsible for decisions, reporting and goal setting based on their areas of expertise, which can lead to more precision and potential business advancement.

Environment Modifications

Your business can adapt to competition, political differences and cultural variations by combining organizational structures. Combining a simple organizational structure at the parent or home office environment with a customer, geographic or product-related structure can focus employee resources on the area or customers they serve, while minimizing unnecessary management levels. Hybrid combinations that rely on self-contained units can act like a small, nimble company when addressing risk, competition and business changes.

Flexibility

Hybrid organizational designs allow you to tailor your business reporting and duty structure to the needs of your business. For example, if you have multiple product lines, you may find combining a product and geographic organizational structure allows you to move employees and resources quickly based on changing customer demand. Tying your organizational structure to your product causes your employees to focus on the support and advancement of each individual product you offer. Adding a geographic component to your organizational structure can tailor offers, marketing and services based on differences in customer price points, packaging and product needs. The dual focus may help you better meet customer needs and, in turn, increase your profits.

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References

Demand Media