Choosing an appropriate organizational type brings with its tradeoffs. Every type has advantages and disadvantages, and these can vary depending on the size and culture of an organization. In very small companies, a flat hierarchical structure where “everyone does everything” is very common, and may the most effective way for that company to function. Meanwhile, a massive corporation would be crippled if forced to use such a structure and would be much better off with a highly matrixed structure.

One issue companies often face is the change that comes with expansion. As companies develop and grow larger, they often must change their internal structures to accommodate their increased size. Departmentalization may be necessary, but changing the structure is not without expense and issues. These growing pains can be potentially very difficult, and handling this is possibly the CEO’s most important job at this phase for a company.

As such, it is hard to say that any particular structure is the most effective. It depends on the specific needs of a company.