An example of Product Based Organisational structure.
ZIMSEC O Level Business Studies Notes: Product based Organisational structure
- This is when organisational operations, departments, duties and tasks are grouped based on particular lines of goods and services.
- The organisation’s structure is based on major product lines and services
- This usually involves organising the business into departments, each of which focuses on a different product
| Advantages | Disadvantages |
|---|---|
| The structure is market oriented (Focused on markets) | There is duplication of resources and functions e.g. Accounting departments may be required across all departments |
| Different departments are forced to coordinate accross all functions | There is less top management control |
| Is flexible | Complicates the coordination process |
| An entrepreneurial spirit is fostered | Hostile competition between departments can prevent the organisation from achieving its strategic goals |
| Friendly competition between departments can encourage hard work |
To access more topics go to the O Level Business Notes page.
