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Six Archetype Organizational Structures

By Erin Lynch-Klarup

My colleague Aaron dubbed 2010 “Year of the Re-Org” in January – and the member interest we’ve seen in organizational structure bears this out.  As planning season rolls around, we’ve been examining various org designs.  We’ve identified six archetypes that optimize to different benefits:

  1. Centralized structures optimize to efficiencies of scale.  Marketing activities are handled by a central team and scaled across many divisions.  Unlike other structures, decision-making power is concentrated with this central team, which reports up to a CMO.
  2. Decentralized Center of Excellence structures optimize customization to a division (product, business unit or geography).  Unique marketing teams report up to heads of divisional marketing; a central team of experts act as internal consultants.  Reporting lines are clear and simple, and there is no company-wide CMO.
  3. Decentralized Shared Service structures similarly optimize to divisional customization.  The balance of marketing power lies in divisions, but a central team handles easily-scalable activities.
  4. Hybrid structures ideally balance central scale with divisional customization.  Divisional marketing teams report jointly to a central marketing function and to divisions.  This complex structure is increasingly common in large organizations, as it reflects the highly–matrixed constituencies Marketing works with.
  5. Segment-Aligned structures optimize customer understanding.  The majority of marketers sit within segment teams while a central team coordinates and handles scalable activities.
  6. Project-Based structures optimize flexibility.  In this rare configuration, marketers are deployed to flexible, cross-functional project teams as needed.  Teams are typically temporary, designed to form, deploy and dissolve with the projects they address.

MLC members: Are you contemplating reorganization?  If so, check out our in-depth analysis of each structure including benefits, drawbacks, questions to ask and tests to run.

Comments from the Network (1)

  1. Holger Schulze
    on June 21, 2010
    Respond

    Great article, Erin! You mention re-organizations taking place at an increasing rate – what trends do you see in terms of org types that are becoming more popular vs others that are going the way of the dinosaurs? My (oversimplified) observation is that structures 1-3 are on their way out while 4-6 are becoming more popular. Do you see the same?

    Thanks,
    Holger

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