A corporate system is a framework that outlines how departments collaborate in order to achieve business goals. It also defines how information flows between and between them to prevent communication issues and maintain efficient workflows. The best business systems will help businesses run like well-oiled machines and boost their profits. Not all business systems are suitable for every company. It is crucial for management teams to take time when designing the system, and ensure that it’s compatible with the company’s business model and its culture.
There are four kinds of organizational systems that are used by businesses: the functional a corporate system matrix, divisional, and flat system. The functional system is comprised of divisions that are specialized, such as accounting, sales and marketing. It has a clear hierarchy, and each employee reports directly to the leader of their division. This system is perfect for businesses that sell a lot of products or services since it offers a clear structure, and ensures that each employee is assigned a job to do.
The divisional organizational system divides the staff based on their projects, like research and development or public relations. Each project team is directed by a project coordinator. The advantage of this method is that it allows for faster decision-making and eliminates redundant work. The drawback of this method is that employees may get tunnel vision and may not be able to share ideas across departments. A matrix structure of organization combines the advantages of both functional and divisional systems that allow information to flow smoothly between departments.