General information:
An organization structure is a set of organization units (org codes) that reflects how a company is structured. Units are sorted in hierarchical order and form an organization tree. The tree begins with a root that has the name of a company or a matrix organization, and then descends into departments, production lines, projects, factories, offices, buildings etc. Organization units have a variety of uses (that ultimately determine what you want to turn into an organization unit), most important being:
Company-specific information:
Company organization structure is exclusive to a single company. Unlike a matrix structure, it stores data of a single company and reflects it's hierarchy.
Company organization structure can coexist with a matrix structure without disturbing data integrity.
Matrix-specific information:
Matrix organization structure can be shared between multiple companies. Once a matrix structure is connected to a company, it can use data of this company (postings, properties) and have employees from another company assigned to it. This way, it is possible to assign employees from multiple companies to a single matrix unit.
Matrix organization structure can coexist with a company structure without disturbing its integrity.
Matrix Structure ID:
Structure ID is what connects organization and position structures into an inseparable pair. An employee can be assigned to multiple organization units with multiple positions, but a unit and a position have to share the common structure ID.
With regards to single companies, it does not matter if you start with the creation of a position structure or an organization structure, as their ID is generated when a company is created. In the case of matrix structures, however, you need to create a structure ID to define a position structure.
The matrix structure identifier is automatically created when a matrix organization structure is defined. It has the same name as the topmost organization unit (the root) of the matrix organization structure. Therefore, to define a matrix position structure, you need to at least create the root of a matrix organization during the Define Organization Structure process.