Answer to Question #320935 in Management for preethi

Question

EarthMovers Ltd are into providing heavy vehicle services. They have various heavy

vehicles like tractors, cranes, bull dozers, mixer trucks, etc. They have been growing

increasingly and have employed a total staff of 1200. They have divided their business in

a Divisional structure. Based on this information, answer the following questions.

a. Discuss the features of divisional structure of organization and infer the divisions that

EarthMovers may have employed.

b. Elaborate on the factors that influence organizational structures.

Answer 1

a) A divisional organizational structure consists of parallel divisions. These division might be responsible for a product or service, a geographical location, or a customer group. Each unit is equipped with its own resources to function independently. The divisional organizational structure organizes the activities of a business around geographical, market, or product and service groups. Thus, a company organized on divisional lines could have operating groups for the United States or Europe, or for commercial customers, or for the green widget product line.

b) Although many things can affect the choice of an appropriate structure for an organization, the following five factors are the most common: size, life cycle, strategy, environment, and technology. The larger an organization becomes, the more complicated its structure.