What Are The Advantages Of The Divisional Structure?

Question

What Are The Advantages Of The Divisional Structure?

2 Answers

Answer Question

Answer 1

*clear aims and goals
*managers and employees tend to expertise in the division they work
*easy to acquire and fit in new parts of the business
*easy to sell off loss makers without major disruption
*Quick responses to environmental and economical changes

Answer 2

Advantages of the Divisional Structure

The divisional structure focuses the attention of employees and managers on results for the product, the customer, or the geographical area.

Divisional structure is flexible and responsive to change, because each unit focuses on its own environment. Coordination among different functions within the division benefits from singleness of purpose.

Because each division is a self-contained unit, responsibility and accountability for performance are easier to target. Each SBU operates as a free-standing unit, and manager’s report directly to the CEO or to a handful of top aides.

The SBUs are focused and coordinated. Finally, the divisional structure is also an excellent vehicle for developing senior executives. Division managers gain broad range of experience in running their autonomous units, which are, in essence companies.