The Corporate Structure

Corporations grew out of the desire for many individuals to pool their resources together to achieve bigger things. In the quest for success, however, the number of people involved becomes a hindrance at times. Too many opinions, too many individual plans and perhaps several selfish motives attract arguments and disagreements.

That is why many corporations create structures to develop and utilize the many ideas emanating from organizations. There are different kinds of organizational structures utilized by different corporations depending on their specific needs. There are linear organizations, some circular with the idea originator eventually approving a final, detailed and complete plan. There are top-to-bottom organizations and there are bottom-to-top lines.

One of the newer concepts on corporate organizations is the concept of the team. In this setting, different individuals with different expertise come together as equal to start discussions on problems and issues in the organization and the business. They come with recommendations which they send to the top management.  

There are also special groups created to deal with problems – otherwise known as task forces. These are groups of individuals gathered specifically for a purpose and will be disbanded once their objectives are met. In the military, task forces are created from smaller units to create a sufficiently-numbered bigger unit for the task at hand.  

In most corporations, the ultimate decider on bigger issues is the board. Often composed of the people with the biggest stake or ownership share in the companies, the board sets policies and the general direction of the company. They approve budgets and salaries of top management. They also review financial records to ensure that their interests and the interests of smaller shareholders are protected.

The board is headed by a chairman. In most corporations that are owned by family members, the chairman usually is the oldest family member. In modern publicly-listed corporations, the patriarch of the group or family that has the biggest share becomes the chairman. Most often, the chairman has no official functions aside from approving matters approved by the board. He is more seen as an influential figure that sets broad directions and policy objectives.

The man who will implement the orders of the chairman and the board is a chief executive officer (CEO) or the president. It is his job to make the numbers and to turn in the profit. Matters for approval by the board, more investments, acquisitions, hiring and firing and general company concerns are mostly recommended by the CEO. The president runs the show and the board makes sure he did things right.

Corporations may look and sound the same for many. The difference between successful corporations and those that struggle is the perfect amalgamation of leadership, vision and structure. People run organizations. Success and failure rely on how organizations and corporations bring out the best from people.