There are three ways to organise a SaaS company of under two hundred people and the difference between them is entirely about where the dotted lines end up. A functional structure keeps every discipline together and coordinates through meetings. A pod structure puts a cross-functional group around each product area and coordinates through the pod. A hybrid keeps people in their function and lends them to pods, which is the most common answer and also the one that produces the most dotted lines. This page is the three, priced: on the worked example 43 dotted lines cost about $2,428 a month in check-ins.
Functional: cheapest in lines, most expensive in meetings
Everyone sits under their discipline's leader and cross-functional work is coordinated in a standing meeting. There are no dotted lines and no ambiguity about who writes the review, which is why it stays the default. The cost is that every product decision needs three functions in a room, and the number of those rooms grows faster than headcount does.
Pods: fewest meetings, hardest on craft
A pod of six or seven, one of each discipline, owns a product area end to end and reports to a pod lead. Coordination happens inside the pod rather than in meetings, which is the point. The cost is that the one designer in the pod has nobody to learn design from, which is why pure pods usually acquire functional dotted lines within a year.
Hybrid: the common answer, and the one to count
People stay under their function for craft and review and are assigned to a pod for work, which means most of them carry two lines. On the worked example 22% of the company at 1.4 lines each is 43 dotted lines, 2.4 for every manager, 46 hours a month of check-ins and $29,149 a year. That figure is what the hybrid actually costs, and it is worth knowing before the third pod is created.
Questions people ask about saas org structure
How big should a pod be?
Six to eight, which is the same span of control the rest of the chart runs on. A pod of twelve is a department that has not admitted it yet.
Who writes the review in a pod structure?
Whoever the solid line points at, and the company should pick one answer and apply it everywhere. Mixed answers are how a matrix becomes an argument.
Can the structure change without a reorganisation?
The dotted lines can, and usually should. Moving solid lines is the expensive change, which is a good reason to keep pod membership on the dotted side.