ABSTRACT
With the exception of small partnerships, the lines of authority flow in a specified, hierarchical manner through a number of levels that depend on the size of the organization and the preferences of the Board of Governors. An organization may have multiple organograms to depict reporting relationships, authority to commit funds internally, accrual of costs and profits, signature authority to commit the enterprise, coordination responsibilities, and so forth. Managers in product line structures have the advantage of a specialization enhanced by broader experiences outside of just one discipline. Governance codifies the nature of flow of authorities, duties, and responsibilities and provides the superstructure that assures that the corporation has a competent, ethical, and effective CEO and subordinate officers who operate the organization effectively, legally, and ethically to produce value for owners. The Board is legally bound to monitor diligently business operations, guiding and approving the strategic plan and movement of the corporation.
