You can track which actions led to which results and assign responsibility accordingly. Here are some advantages of using a divisional structure at your company: Creates more accountability and transparencyīecause divisions have their own management groups to lead them, it's easier to hold individuals accountable for their actions.
Related: 10 Types of Organizational Structures (With Pros and Cons) Pros of using a divisional structure Serving major clients who need individualized attention Marketing their brand in different geographic locations Offering both businesses-to-customer and business-to-business servicesĪdvertising to a wide variety of demographics Selling a wide range of customer-facing product lines Businesses using a divisional structure may have one or more of the following characteristics: This is most useful for larger companies that benefit from organizing their workforce into relatively independent groups. Some companies have marketing, sales and communications departments, while a divisional organization has teams dedicated to a specific region or product. What is a divisional structure?Ī divisional organizational structure is a system in which a company segments its employees based on products or markets, as opposed to their job roles. In this article, we define divisional structure, list the pros and cons of this type of organizational structure and provide a solution for each con.
While there are advantages to a divisional organization, there are also some disadvantages-so it proves important to know the pros and cons to understand how they may impact your business if implemented. Divisional structure is one such system a company may use to improve different aspects of its operations. Illustration of three types of businesses in a row.īusinesses typically need organizational structures in order to perform at their best.
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