There is no one best way to organize a company. The strategy, rules, policies, and controls should vary from company to company and may even vary from store to store. One example of this is McDonald’s, which is able to turn around food quickly and consistently across its many franchises because the company has a tight structure. That structure slipped in the 1990s, when the company stopped using inspectors to grade its restaurants on service, food, and ambience. Customers noticed–they wanted their Big Mac to taste the same no matter which McDonald’s they patronized. The company eventually brought back the inspectors (centralizing quality control), but it also allowed for tweaks in the menu by franchisees, so customers could eat McDonald’s breakfast porridge in England, for example, and McDonald’s veggie burgers in India.
However, other organizations find a looser structure is needed to be successful. The structure should fit the situation. Managers have these six basic options to choose from:
- Functional groups based on their knowledge or skills: This usually works best for academic settings, researchers, and engineering groups.
- Units based on time: Such as day versus night shifts.
- Groups organized by product: A tech company may split up its employees by those who work on smart phones versus those who work on tablets.
- Departments based on the client needs: Hospitals, for example, are broken up by the patients they serve (pediatrics vs. intensive care).
- Groupings around place: Global organizations may operate differently from country to country.
- Units divided by process: If a product or service has various steps, this setup may make the most sense.
The “right” answer for any one organization should be based on what works for the people within it and its purposes.