The activities related to one product are grouped under one division. The organizational structure consists of separate divisions, each such division has its own manager. If an organisation wants to grow and diversify, the functional structure cannot cope, so instead the divisional structure should be adopted. It is good for a company which is … Advantages & disadvantages of divisional structures Advantages . In this lesson, you'll learn about divisional structures, including their advantages and disadvantages. 4. C) there can be dysfunctional competition among divisions. The potential conflict between domestic and international operations (Managers in the international division may feel like “second class” citizens if they are not at the same hierarchical level as managers in domestic operations) b. Disadvantages of International Division a. On this basis any unprofitable division can be closed. 2. Generally, manpower is grouped on the basis of different products manufactured. B. Divisional Structure An organization which is very large in size and is producing more than one product, they need to evolve a design to cope with the complexity. Preventing the design of products with both domestic and international appeal c. Precluding … Fig. B) there is a strong tendency for divisions to focus on short-term performance. Divisional results can be assessed: Divisional results (profit/loss) can be assessed easily. (i) Departmental Conflicts : Strife may arise among various divisions with regard to decisions and actions of organisation such as those relating to allocation of funds and resources. A divisional structure has certain disadvantages as well. 2. Should the company want to diversify … A divisional structure is a common organizational form used in business. Divisional organizational structure based on … Disadvantages 1. Advantages of Divisional Organizational Structure Divisions work well because they allow a team to focus upon a single product or service, with a leadership structure that supports its major strategic objectives. This is a more decentralized type of operation where each division functions much like its own separate company. All of the following are disadvantages of a divisional type of organizational structure except A) it can be very expensive compared to a functional organizational structure. Disadvantages of Divisional Structure. Large companies that serve a varied customer base or operate in a number of geographic regions may choose to operate with a divisional structure. CBSE Class 12 Case Studies In Business Studies – Organising. Part 4 Organizational Processes Evaluating Divisional Structures Slide 17 Evaluating Divisional Structures • Advantages of divisional form-building block structure -- accommodates growth-handles product, client diversity well • Disadvantages of divisional form-more resource duplication, underutilization-creates silos of knowledge-less cooperation across units Matrix Structure … Each unit has a divisional manager responsible for performance and who has authority over the unit. A divisional structure comprises of separate business units or divisions. The following are some of the disadvantages of a divisional structure. As with any organization structure, divisional structures have both strengths and weaknesses. Growth and Expansion: It facilitates growth and expansion as new divisions can be added without disturbing existing departments. Disadvantages of Functional Structure: ... B. 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