Question -
Answer -
The business has been doing well and she intends to expand by diversifying into leather bags as well as western formal wear thereby making her company a complete provider of corporate wear. This will enable her to market her business unit as the one stop for working women. Which type of structure would you recommend for her expanded organisation and why?
Answer
The organisation structure that Neha can follow is that of divisional organisation structure. Under this system there will be separate departments which will be taking care of different products. There will be separate personnel for managing the departments.
The divisional structure is recommended for the following reasons:
1. Each of the department will have a head who will be accountable for the overall performance of the department. The performance of individual departments can be determined easily and the best and worst performers can be identified and necessary steps can be taken.
2. Decision making will be quick as each department has a specialist to manage it.
3. Having a divisional structure allows adding more divisions without impacting the functions of the organisation.