Organizational Structures in Business Organizations

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What is one potential benefit of decentralization mentioned in the text?

Increased returns for the organization (correct)

Limited departmental control

Lower productivity levels

Decreased competition among departments

How does decentralization impact departmental accountability according to the text?

It reduces accountability at each level

It eliminates the need for performance evaluation

It hinders the assessment of organizational objectives

It increases individual departmental accountability (correct)

Why is it important to balance decentralization with centralization according to the text?

To discourage innovation

To prevent organizational disintegration (correct)

To reduce productivity levels

To limit departmental competition

What challenge does decentralization pose in terms of performance accountability?

Raises concerns about accountability of performance Signup and view all the answers

How does decentralization impact the generation of returns for an organization?

Increases the generation of returns Signup and view all the answers

In response to challenges in decentralization, what control systems are being evolved according to the text?

Innovative performance measurement systems Signup and view all the answers

What is a potential challenge related to managerial development in a divisional structure?

High coordination costs Signup and view all the answers

In a divisional structure, what is a benefit of integrating all functions related to a particular product in one department?

Easier responsibility allocation Signup and view all the answers

What is a consequence of failing to adapt to change in a dynamic business environment?

Inability to survive Signup and view all the answers

What can hinder managerial development in a divisional structure due to an assertion of independence by managers?

Ignoring organisational interests Signup and view all the answers

In what type of business enterprise is a divisional structure suitable?

Enterprises with multiple product lines and varied resources Signup and view all the answers

What aspect makes it easier to fix responsibility for performance in a divisional structure?

Product specialization Signup and view all the answers

Which type of organisational structure is more suited for large organisations with diversified activities?

Divisional structure Signup and view all the answers

Why might functional heads in an organisation have difficulty appreciating other points of view?

Narrow perspective due to same skills and knowledge base Signup and view all the answers

In a divisional structure, the organisation comprises of separate ____________.

Business units or divisions Signup and view all the answers

Why do large organisations with diversified activities move away from the basic functional structure towards a divisional structure?

To better cope with complexity Signup and view all the answers

Which organisational size is most suitable for a divisional structure according to the text?

Large organisations with diversified activities Signup and view all the answers

How does a divisional structure differ from a functional structure?

Inclusive of separate business units or divisions Signup and view all the answers