Organizational structure refers to the way managers design their firm to achieve the organization’s mission and goals. Managers design formal structures to organize its resources. The organization’s structure determines who works together, and organizational communication flows through this structure. In the development of an organizational structure, there are five important questions to be answered.

How should we divide the work? To whom should departments and individuals report? How many individuals should report to each manager? At what level should decisions be made? And, how do we get everyone to work together as a system?