Question

Hari Ltd. is growing, so they need specialists, more number of employees, create new departments and introduce new levels of management. Identify the structure that should be followed by Hari Ltd.

• A. Divisional structure
• B. Administrative structure
• C. Functional structure
• D. Informal structure

Hint:

Large and diversified companies use divisional structure for better coordination and focus within product or regional departments.

Answer 1

The Correct Option is A

For Hari Ltd., as it grows and necessitates distinct departments, increased staffing, and augmented management tiers, the most appropriate organizational framework is the Divisional Structure. This model segregates operations by product lines, geographical areas, or target markets, fostering dedicated concentration within each unit.
Advantages of the Divisional Structure:

• Enhanced adaptability and defined responsibility within individual divisions.
• Focused expertise and a precise emphasis on specific product or geographic segments.
• Dispersed authority for more agile reactions to market demands.

Clarification of Alternative Structures:

• (B) Administrative structure: An imprecise descriptor, lacking formal organizational standing.
• (C) Functional structure: Best suited for organizations of limited scale or diversity; emphasizes task specialization but does not accommodate new product-centric divisions.
• (D) Informal structure: Emerges organically from interpersonal dynamics; it is not a formal or scalable organizational design.