Corporate Management Structure

A corporate management structure defines the person responsible for each aspect of a company, which allows the company to benefit from economies of scale and coordinate its activities. A clothing manufacturer, for instance might have separate departments for men’s, women’s and children’s clothes however, they have a common marketing department. This divisional structure enables the departments to focus on their own specific product and market, while sharing information to ensure better coordination. This type of structure, however, can lead to higher employee costs and more duplication of efforts such as when purchasing supplies for multiple divisions.

Corporations are legal entities with stockholders. They require an appropriate management structure in order to comply with laws and protect the interests of shareholders. Most companies have a multi-level system of officers, directors, and shareholders, who oversee the operation of the company.

The top of the pyramid is the chief executive officer (CEO) who is responsible for approving on contracts and other legally binding actions on behalf of the company. A small company’s CEO could be the sole founder and chief director, officer, and shareholder or in larger corporations, be appointed by the board of directors.

The board of directors https://chartinglogin.com/real-estate-and-data-rooms-how-digitalization-is-evolving-the-market/ is made up of the elected representatives of stockholders who oversee the overall direction and policy of the corporation. They select and supervise the performance of the CEO, and also manage succession planning. They also approve major business transactions and operations, like contracts acquisitions and sales of assets policies, new policies, the list goes on.

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