Disadvantages of divisional structures, Strategic Management

Assignment Help:

Q. Disadvantages of divisional structures?

- As the complexity and diversity of products and markets within the group increase, central coordination by a head office or holding company becomes more difficult.  This requires more resources and cost e.g. administration staff, head office buildings and information systems in order to maintain increasing complexity of activities.

- Duplication of functions (or departments) within each division e.g. each division having an IT or finance department, could lose the benefits economies of scale, therefore increasing group overhead.

- Reluctance by senior management at head office to give more delegated or decentralised control therefore reducing effectiveness of the divisions management e.g. slowing down decision making and flexibility.

- Lack of goal congruence or possible  "sub-optimal" decisions made by divisional managers at tactical level e.g. following personal as opposed to corporate objectives and aims.

- Other added complications to deal with such as transfer pricing issues or inter-divisional rivalry harming group performance.


Related Discussions:- Disadvantages of divisional structures

Bus 475, i need immediate help with an assignment, can anybody help.

i need immediate help with an assignment, can anybody help.

Strategic plan to restore business confidence, In response to the start of ...

In response to the start of the credit crisis, EU Finance ministers agreed a set of conclusions in October 2007. These initiatives were grouped into the so-called Economic & Financ

Profile international markets, Using online research and the resources on t...

Using online research and the resources on the Student Portal, select and undertake market research of 2 possible "emerging economy" countries where Eatmore & Green might be able t

Macroeconomic effects of crisis, Central banks had been supplying short-ter...

Central banks had been supplying short-term funding to smooth needed adjustments in the banking sector, but that alone could not stem bank losses. So what had been addressed as a l

Explain the function of the group, a.     Explain the function of the group...

a.     Explain the function of the group. b.     For each group, describe the following: 1)     How it came into being. 2)     How long it has existed (and is expected to

Leadership, i have to redo the assignment

i have to redo the assignment

Calculate the growth-price-recovery, Hamadi Corporation manufactures an ele...

Hamadi Corporation manufactures an electronic component 'AZ-101'. This component is significantly different from its peer companies and has gained a high repute. The company presen

Cadbury dairy milk, Value proposition and product customer connect of cadbu...

Value proposition and product customer connect of cadbury dairy milk

Diagnosis of endometriosis, C.M. is a 28-year-old woman with a long history...

C.M. is a 28-year-old woman with a long history of dysmenorrhea managed for many years with oral contraceptives. She stopped taking the pill 8 months ago in anticipation of becomin

Strategy is currently developed in vrc company, VRC is a family owned busin...

VRC is a family owned business which has been manufacturing racing cycles for over a century. Over the years, the company has been relatively successful, although its growth has te

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd