Organizational Structures of Large & Small Businesses

Organizational Structures of Large & Small Businesses

Whether you own a large-scale business or a small scale one, running it is challenging. However, there are several organizational, structural and managerial aspects in which both these business levels vary greatly.

Organizational Structures of Large & Small Businesses

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Managerial Structure

Large organizations are more bureaucratic in nature collaborated with a more hierarchical structure. This means large companies have more layers of management than that in small organizations because of more number of personnel. This makes management easier in large companies that lead to uninterrupted workflow and growth.

On the contrary, employees in small organizations can directly interact with and participate in decision making as the top managers are only a few feet away.

Employee Responsibility

In large companies, employees have individual operational roles. Employees are young and dynamic and make a more diverse workforce. Also, it is believed that large organizations tend to draw employees looking for job security. On the other hand, smaller companies attract those who wish to work across varying locations or areas or are looking for change, growth, or risk-taking.

Also Read: Types of Motivational Theories of Management


Large organizations are often affected by politics due to the multiple managerial layers. Politics, on the other hand, tends to play a lesser role within the smaller ones. Here, the owners of the organization have direct communication with each employee and enjoy long-standing relationships with them.

Decision Making

Generally, strategic decision-making is more centralized in small organizations due to the relatively less number of managers.  Although it is uncommon for managers to make all the decisions virtually in the first one to five years of a business, it becomes impossible for a single person or a managerial team to make every decision once a company reaches a certain size.


There is a strong argument that larger organizations tend to offer higher salaries to their employees as compared to those in smaller ones. Also, this is often followed by perks such as gym memberships, private healthcare, etc. to make their benefits more substantive.

Also Read: Do large companies pay more?

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Joe David

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