Team Structure: Definition and Implementation

Max 7min read
Team Structure

Are you tired of working in a team where everyone seems to be doing their own thing, causing frustration and agitation? Do you feel like your team could be more efficient, but you’re not sure where to start?

Well, it might be time to rethink your team structure.

The team structure is like the skeleton of your team – it gives shape and direction to how you work together. And just like a skeleton, it can cause much pain and discomfort if it’s not correctly aligned. 

But fear not! With the right team structure, you can create a positive work environment, improve productivity, and foster strong relationships among your team members.

In this article, we’ll explore all about team structure. Let us get started without further ado.

What Is a Team Structure?

Definition of Team Structure

The team structure is an arrangement within an organization where diverse teams execute specialized tasks to achieve the company’s common objective collectively. These teams can make autonomous decisions while mindful of the company’s goals.

A company’s team structure is one essential aspect that helps it run like a well-oiled machine. The structure helps employees understand their roles, the culture of the organization, and the flow of communication. With clear roles and smooth communication, you can make decisions efficiently.

Organizational structure creates a sense of order and defines responsibilities, performance, and evaluation standards. Organizational structures come in an array of types, and one of them is the team structure. 

Recently, many organizations have decentralized their structures to empower their employees, and the team structure has become increasingly popular.

In a team structure, each team has a leader or manager who reports to senior management about the team’s performance. Though the teams may have different roles, they share a common interest – to improve their performance and help the organization achieve its mission.

The team structure impacts the distribution of authority, which affects the collaboration between teams, the leadership, and each team member. However, having a team structure also has its advantages. It creates a clearly defined way of working together and achieving goals. 

Therefore, whether you’re a team leader or a team member, understanding the team structure can help you work effectively and contribute to your team’s success.

Common Types of Team Structures

Let us introduce you to six team structures that can help organizations achieve their goals differently.

Hierarchical Structure

First up, we have the hierarchical structure. It is the most common team structure, where leaders are placed at the top of the pyramid, followed by directors, managers, and employees.

It creates transparent and robust boundaries where roles are clearly defined. This structure best suits teams with straightforward reporting styles, clear career paths, and specialized individual roles.

Circular Structure

Next, we have the circular structure, which is also hierarchical but with a more fluid relationship between employees. High-level leaders reside in the circle, while lower-level employees are outside the circle rings. This structure is best for teams that want to streamline communication, create an easy flow of information, and foster fluid relationships.

Matrix Structure

The matrix structure organizes team members into a grid, which sets individuals up to report to multiple leaders. This type of team structure can improve decision-making processes and create a balance between leadership roles. 

This type of structure is best suited for teams that want to improve collaboration and communication and balance leadership between units and products.

Functional Organizational Structure

The functional organizational structure groups employees with common job functions together. This structure allows individuals with similar interests and talents to collaborate, boosting creativity, innovation, and efficiency. 

This team structure is best for teams that want to produce experts in their field, foster team accountability, and see company growth.

Market-Based Structure

The market-based structure divides people by industry, market, or customers. This type of structure enables employees to focus on the demands of a specific sector and fosters team specialization.

It works for teams seeking a balance between individual and teamwork and wants to highlight personal accomplishments.

Process-Based Structure

Lastly, we have the process-based structure, which highlights different internal processes rather than departments. This team structure type best suits teams that want to optimize efficiency, need assistance with many other functions, and want to streamline organizational growth.

Factors to Consider When Choosing a Team Structure

When selecting a team structure, there are several factors to remember to ensure that the chosen structure is the best fit for your organization. Here are some key factors to consider:

Organizational goals

Your team structure should align with your company’s objectives. Suppose your company’s primary focus is on innovation and creativity. In that case, a structure that encourages collaboration and idea sharing, such as a circular or matrix structure, may be ideal.

Team size

The size of your team is an important consideration. Large teams may benefit from a hierarchical team structure with clearly defined roles and responsibilities. Smaller teams are suitable for a circular or matrix team structure, encouraging communication and cross-functional collaboration.

Type of work

You should also consider the kind of work your team does. For example, a process-based structure may be most effective for teams that work on projects with well-defined processes. In contrast, a market-based team structure may suit teams serving specific industries or markets.

Communication needs

Communication is critical to the success of any team. Consider whether the chosen team structure facilitates communication between team members and management. A circular team structure may promote open communication and information sharing more effectively.


Finally, it’s essential to consider whether the chosen team structure allows for flexibility as your organization grows and evolves. A matrix structure, for example, is designed to be adaptable and can accommodate changes in team size and project scope.


Some organizations give their staff the autonomy and support they need to implement new solutions, express greater accountability, and achieve lasting results. Autonomy may nurture a sense of belonging and empowerment among team members.

Implementing an Ideal Team Structure

Let’s discuss building a reliable team to help you achieve your business goals. Whether you’re a new manager or an experienced one, reviewing the best practices for building a team that’s driven to succeed is always helpful. 

Let us break down 14 steps to create a successful team structure.

Step 1: Set Organizational Objectives and Initiate Strategizing

First, it’s essential to set clear goals and start planning. Clearly defining your goals, such as landing more clients or improving the success of the next marketing campaign. It will help you identify the people, processes, equipment, and relationships needed to achieve them. 

Review past efforts and your current situation to see what you need to do to address these concerns.

Step 2: Define the Responsibilities of Your Team Members

Once you’ve identified your business needs, assigning responsibilities to specific roles is essential. Defining roles and responsibilities can enormously impact your team’s success. It is because everyone knows their responsibilities.

Step 3: Enhance Your Team Member’s Strengths

A strong leader knows and utilizes the skills and strengths of each team member. Review the capabilities of each person on your team, including their strengths and weaknesses, and identify where people have complementary skills. 

Giving someone backup or a partner who excels where they struggle can keep morale high and limit workplace frustration.

Step 4: Be Open to Diversity

Diverse organizations not only perform better but operate more cohesively and improve internal relationships. Look for diverse staff in many ways to help you create a team that tackles each problem from multiple vantage points.

Step 5: Establish Clear Expectations From the Start

After setting roles, tell your team what it looks like to successfully meet their goals and requirements. Defining expectations from day one will help you keep projects on track and shepherd them to completion.

Step 6: Encourage a Culture of Experimentation

Taking risks helps your team grow and find innovative solutions to existing problems. However, guiding these efforts to keep them reasonable for your company and protect the bottom line is essential.

Step 7: Make Failure a Stepping Stone Toward Success

When your team meets a goal, praise them. Celebrate their accomplishments and acknowledge their actions. Recognize their performance and appreciate the person they are. Don’t be so hard on them if they miss a target. Instead, appreciate their effort. Appreciation makes your team more likely to stay.

Step 8: Encouraging Personal Growth

Encourage your team members to develop their skills and knowledge. It will not only benefit them personally but also benefit your company.

Step 9: Promote Opportunities for Team Building

Team building activities can help your team members bond and develop relationships. Such connections can improve communication, morale, and productivity.

Step 10: Create a Safe Space for Communication

Encourage your team members to communicate openly and honestly. It can help prevent misunderstandings and conflicts.

Step 11: Establish a Supportive Work Environment

A positive work environment can improve productivity and reduce turnover. Encourage positivity by recognizing and appreciating your team members’ efforts.

Step 12: Proactively Addressing Workplace Conflicts

When conflicts arise, address them quickly and fairly. Encourage open communication to resolve issues before they escalate.

Step 13: Regularly Assess Team Performance

Regularly evaluate your team’s performance and progress. Identify areas for improvement and provide constructive feedback.

Step 14: Set a Positive Example

As a manager, you should lead by example. Your team will turn to you for assistance. Hence, it’s essential to model the behavior you want to see in your team.


What are the benefits of having an effective team structure?

Strategically formed teams with diverse skills and experience foster effective communication and adaptability. By enabling collaboration among individuals with varying strengths and expertise, teams can respond swiftly to changes in their environment, resulting in improved outcomes.

How can I measure the success of my team structure?

Proposed approaches to gauge the effectiveness of team structures: 

  • Establishing KPIs for each team project
  • Frequently meeting with the team
  • Speaking with other managers at the organization 
  • Meeting with team members one-on-one
  • Determining whether the team’s projects add value to the company.

Crafting great product requires great tools. Try Chisel today, it's free forever.