Divisional structure
Definition: A divisional structure is one that puts employees into groups/segments according to product and regional differences (Fairfield, 2018). Additionally, each division is responsible for its actions.
Summary
A divisional structure is usually suitable for big organizations with a vast number of employees (Fairfield, 2018). The principal aim of the divisional structure is to simplify tasks at each level of the organization. Each division in the organization functions independently, and this means that each of them should do its best to contribute to the success of the organization as a whole. Additionally, each division in an organization has its marketing methods, finance officers, sales agents, and development personnel, among other people. The primary aim of this structure is to ensure that each division in the organization is productive to make the organization achieve its set goals and objectives. Examples of organizations with such a structure is Samsung, where they have different divisions dealing with various products and services, e.g. the electronics division, smartphones division, among many others. Therefore through this structure, an organization gets an opportunity of sub-dividing all its resources to the various departments and catalyze the organization’s productivity and effectiveness as a whole.
Discussion
It is of paramount importance for business organizations to look at the merits and demerits of an organizational structure before adopting it. Among the critical issue that organizations ought to consider before deciding to choose a particular structure include; the size of the organization, organizational objectives and goals, number of employees, type of activities undertaken by the organization among many other factors. The divisional structure is known to effective in big organizations with many employees. However, the divisional organizational structure has merits and demerits. Among the critical benefits of the structure include the following. First is that accountability is achieved in the organization since each division in the organization is solely responsible for its actions.
Additionally, the division that is committed and moving forward can be distinguished from poorly performing divisions in the organization. Secondly is that the structure catalyzes and encourages employees to embrace working together as a team while in one division. The third advantage of this structure is that the division can easily adapt and adjust to the prevailing external changes. This is bound to happen since each of them deals with a specific product and service. Fourthly is that the divisional structure helps the organization to build a robust organizational culture that is key to organizational success. Lastly is that the divisional structure encourages excellent leadership in the organization since each division has its leaders.
On the other hand, the following are the demerits of the divisional structure. First is that it is not suitable for small organizations. Secondly, it encourages internal competition in the organization that can affect the organization adversely. The third disadvantage is that divisions dealing with related products can find it hard to integrate the products at one point. The fourth demerit is that the lack of communication between the divisions can cause confusion and misunderstandings in the organization hence affecting the commitment of the organization to achieve its objectives. Lastly, the divisional structure hinders an organization from getting the economics of scale.