A network structure is the one in which more than one organization combine to produce a good or provide a service. These organizations can either get into a partnership for a particular venture, or one organization can hire others to handle one or more of its functions (outsourcing), for example, marketing, production, sales and so on. Outsourcing is done by organizations pursuing network structure. We also covered Functional Organizational Structure or Divisional Organizational Structure. if you’re interested to read about different types of organizational structures. Network Organizational Structure Examples An organization that has been using network structure is H&M (Hennes & Mauritz), a very popular brand that has followers world over.  H&M has outsourced the production and processing of their goods to different countries majorly Asian and South East Asian countries. The figure above explains the fundamentals of a network organizational structure. In the middle, there is a blue circle with ‘core company’…

The literal meaning of division is ‘an action performed to separate certain things into a number of parts’. We often see organizations divided into several groups on different grounds such as regional, product or service. Any organization that divides its employees and other resources into different groups based on regional and product differences, such that each group is responsible and answerable for its own actions, has a divisional structure. For example, the electronics department of Samsung is completely responsible for its own actions. The smartphones department is responsible for its own actions. Moreover, a firm’s city division might be completely independent of its other city’s division. Each division would have its own advertising, sales, production, clerical, accounting, and development staff. The divisional structure tends to ease the tasks of each level of management. It becomes easier for them to evaluate staff and divisional performances and base their compensations on their…