Divisional structure is formed when an organization is fragmented up into a number of self-contained business units, each of which functions as a profit center. This organizational structure splits into self-dependent units or divisions based on location, product, customer and process. But with certain key function (e.g. finance, personnel, corporate planning) provided centrally, usually at company head offices.
You are required to take two organizations of your choice and segregate the business units on the basic of consumer and product.
Divisional structure by product
Divisional structure by consumer
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es problem me koi mushkal nhe he. I think, es me hum ne sirf 2 organization ko alag alag karna he on the basis on consumer and product. we write only the name of 2 organization in the table. these names should be choices of students.
This mean that we should write the name of the organization in 1st column which is separate from the 2nd one on the basis of the product,
And in the 2nd column we write the name of the organization on the basis of the customer which is separate from the 1st one.
For example, consumer goods companies tend to emulate the divisional structure-by-product form of organization.
Divisional structure is formed when an organization is split up into a number of self-contained business units, each of which operates as a profit centre. such a division may occur on the basis of product or market or a combination of the two with each unit tending to operate along functional or product lines, but with certain key function (e.g. finance, personnel, corporate planning) provided centrally, usually at company headquarters. The divisional or decentralized structure is the second most common type used by American businesses.
As a small organization grows, it has more difficulty managing different products and services in different markets. Some form of divisional structure generally becomes necessary to motivate employees, control operations, and compete successfully in diverse locations. The divisional structure can be organized in one of four ways: by geographic area, by product or service, by customer, or by process. With a divisional structure, functional activities are performed both centrally and in each separate division.
A divisional structure has some clear advantages. First and perhaps foremost, accountability is clear. That is, divisional managers can be held responsible for sales and profit levels. Because a divisional structure is based on extensive delegation of authority, managers and employees can easily see the results of their good or bad performances. As a result, employee morale is generally higher in a divisional structure than it is in a centralized structure. Other advantages of the divisional design are that it creates career development
opportunities for managers, allows local control of local situations, leads to a competitive climate within an organization, and allows new businesses and products to be added easily
The divisional structure by product is most effective for implementing strategies when specific products or services need special emphasis. Also, this type of structure is widely used when an organization offers only a few products or services, or when an organization's products or services differ substantially. The divisional structure allows strict control and attention to product lines, but it may also require a more skilled management force and reduced top management control.
When a few major customers are of paramount importance and many different services are provided to these customers, then a divisional structure by customer can be the most effective way to implement strategies. This structure allows an organization to cater effectively to the requirements of clearly defined customer groups. For example, book publishing companies often organize their activities around customer groups such as colleges, secondary schools, and private commercial schools. Some airline companies have two major customer divisions: passengers and freight or cargo services. Merrill Lynch is organized into separate divisions that cater to different groups of customers, including wealthy individuals, institutional investors, and small corporations.
SOLUTION FOR ASSIGNMENT NO.2 MGT603 AND PLEASE ANYBODY CAN PLEASE GIVE THE COMMENT IS IT RIGHT AND ABOUT HOW MUCH WILL BE ACQUIRE FOR IT FORM 10 MARKS
MUNESH KUMAR u did not mention the names of two organizations on which bases You have to differentiated them by divisional product & customer structure. which 2 org u took?