The organizational model has two main components: organization types and organization hierarchies. To start modeling your business, you have to understand each one of them to be able to establish your organizational structure.
The following diagram shows the complete components of the organizational model framework:
Note
Party records: Some organizations may have multiple legal entities or locations; therefore, you can create party records in the Global Address Book form to separate these entities or locations.
Creating separate entities using party records reduces the confusion when communicating with different areas in an organization.
The organization types in Microsoft Dynamics AX 2012, legal entities and operating unit are as follows: