Company Structures: Types and Organizational Models
Company Structures: Types and Organizational Models
Company
The number of partners for its formation is one or more; a single-partner company is called a one-person company. Liability is limited to the capital. A minimum of €60,101.21 is needed, with at least 25% subscribed or paid at incorporation. The company name is followed by “Company” or “SA”. It’s taxed on income tax, has legal personality, and requires a public deed before a notary and registration in the commercial register. Constituent bodies include:
- Central Board: Decides on important business issues. Types include ordinary, extraordinary, and universal meetings.
- Administrators: Can be a single administrator or a board of directors.
Requirements include annual accounts within three months. Capital is divided into shares, created simultaneously (all shares disbursed at creation) or consecutively. Share transfer is free once registered.
Limited Liability Company
One or more partners can form a limited liability company (LLC); a single-partner LLC is called a sole trader. Liability is limited to the capital. A minimum of €3,005.06 is needed, fully subscribed and paid at incorporation (cash, property, or rights). The company name is followed by “Limited Liability Company,” “limited company,” “SRL,” or “SL”. It’s taxed on income tax, has legal personality, and requires a public deed before a notary and registration in the commercial register. Constituent bodies include:
- General Board: All partners deliberate and make decisions.
- Administrators: Must meet certain requirements; they may or may not be partners.
The share capital is divided into indivisible units; transfer is restricted and must be communicated to managers.
Cooperative
The number of members is 2–5, depending on the cooperative. Liability is limited to capital contribution, though bylaws may determine further liability. A minimum membership fee (defined by statutes) is required, with at least 25% paid at constitution. No member may own more than 25% individually, or more than 45% collectively. The name must include “cooperative society” or “s. coop.” It’s taxed on income tax, has legal personality, and requires a public deed before a notary and registration in the commercial register. Constituent bodies include:
- General Assembly: Supreme decision-making body.
- Governing Council: Management and representation.
- Resources Committee: Handles resources.
- Auditors: Audit annual accounts.
Cooperatives can be first-degree or second-degree. First-degree requires at least three workers (Andalusia), second-degree at least two. 30% of the surplus should be allocated to the required reserve fund.
Worker Cooperative
Four or more partners are needed, with at least three being workers. Liability is limited to the capital. A minimum of €60,101.21 is needed, with at least 51% owned by worker-members. The company name is followed by “Limited Liability Company” or “SAL”. It’s taxed on income tax, has legal personality, and requires a public deed before a notary and registration in the commercial register and the Labor Register. No partner can own more than 33% of the capital (except public entities, up to 49%). A special reserve fund (10% of net profit) is required. Capital is divided into registered shares, with at least 25% subscribed and disbursed.
Employment Liability Company
Four or more partners are needed, with at least three being workers. Liability is limited to the capital. A minimum of €3,101.21 is needed, with at least 51% owned by worker-members. The company name is followed by “Labor Liability Company” or “SLL.” It’s taxed on income tax, has legal personality, and requires a public deed before a notary and registration in the commercial register and the Labor Register. No partner can own more than 33% of the capital (except public entities, up to 49%). A special reserve fund (10% of net profit) is required. Capital is divided into shares, fully subscribed and disbursed at constitution.
Organizational Structure Models
An intentional structure defining the placement of company elements. It must be adjusted to the people involved and their goals.
Linear Model
A hierarchical structure based on the principle of command. Each member depends on a superior. Suitable for small to large companies with simple operations.
Advantages: Simplicity, clear authority and responsibility, quick decision-making.
Disadvantages: Lack of management expertise, concentrated authority, inflexibility, lack of motivation.
Functional Model
Specialists dedicated to specific tasks. Lower levels connect to different heads. Developed to overcome linear model limitations.
Advantages: Specialists, direct communication.
Disadvantages: Conflicting orders, potential conflicts.
Online and Advisory Model
Central hierarchical structure with advisory departments.
Advantages: Specialist advice, clear command relationships.
Disadvantages: Slow decisions, potential conflicts between staff, cost.
Committee Model
Shared authority and responsibility; decisions are made jointly.
Advantages: Diverse perspectives, integrated participation.
Disadvantages: Slow decision-making, compromise-based decisions, multiple authorities.
Matrix Model
Combines functions and projects; each person reports to a project director and a functional department director.
Advantages: Flexibility, adaptable to projects.
Disadvantages: Coordination challenges, potential conflicts between directors.
Organization Charts
Simplified graphical representation of the organizational structure.
Chart Types:
- Vertical: Highlights the chain of command.
- Horizontal: Highlights functions.
- Radial: Creates visual impact, highlighting top management.
Employer Functions
Company management performs governmental functions, provides instructions, and establishes criteria for achieving objectives. Management combines human and material factors to achieve goals, considering the changing environment. This involves planning, organizing, controlling, and managing.
Planning:
Setting goals, strategies, policies, and decisions to achieve company objectives.
Organizing:
Designing a structure defining tasks, responsibilities, and authority, ordering relationships between tasks and areas.
Managing:
Managing personnel to perform tasks and achieve objectives.