om_lesson5.pptVIP

* Divisional structures have managers usually are responsible for the operations within the division including profit and loss responsibility. * * 36 5 For use with Organization Theory and Design by Richard Daft, Jonathan Murphy and Hugh Willmott 1844809900 ? 2010 Cengage Learning  For use with Organization Theory and Design by Richard Daft, Jonathan Murphy and Hugh Willmott 1844809900 ? 2010 Cengage Learning  Fundamentals of Organization Structure Lesson five Divisional Structure A divisional organizational structure is one in which a set of relatively autonomous units, or divisions, are governed by a central corporate office but where each operating division has its own functional specialists who provide products or services different from those of other divisions This expedites decision making in response to varied competitive environments The division usually is given profit responsibility Divisional Organization Structure April 18, 2006 LIS580- Spring 2006 * Divisional Organizationfor a Pharmaceuticals Company FIGURE 6–2 G.Dessler, 2003 Functional vs. Divisional Structure -Example 0 Divisional Structure Product structure or strategic business units Divisions organized according to products, services, product groups, business… But what is a business? 0 What is a business? The definition of a business is an issue that should not be taken lightly. In his book Defining the Business- The Starting Point of Strategic Planning prof. Abell suggests a three dimensional model, with the following 3 axes: Served Customer Groups: Categories of customers. (WHO) Served Customer Functions: Customer needs. (WHAT) Technologies Utilized: The way that the needs are being satisfied. (HOW: for example, mobile and fixed telephone)  Multi-Divisional Structure Each division is operated as a separate business Appropriate for related-diversified businesses Key task of corporate managers is exploiting synergies among divisions Managers use a combination of strategic co