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

Three stage transformation model of inputs, Product manufacturing operation...

Product manufacturing operations can be described as a three stage transformation model of inputs. Inputs Inputs are intangible. Unlike a traditional product, a servic

Delta products case instructions, Here is the "Delta Products" case for Gra...

Here is the "Delta Products" case for Graduate Operations. You need to determine the number of hours for Mike's and Nikki's plan. To do this you need to compute the number of hours

Strategic management, 1. “A mission describes what the organization is now;...

1. “A mission describes what the organization is now; a vision statement describes what the organization would like to become.” Differentiate between corporate mission and strategi

Explain developing a strategic vision, Developing a Strategic Vision: Phase...

Developing a Strategic Vision: Phase 1 of the Strategy Executing, Strategy Making Process 1.   Very early in the strategy making process, a company's higher-ranking managers mu

Describe packaging or labelling features, 1. Describe the brand you will es...

1. Describe the brand you will establish across as many dimensions as you think are relevant 2. What will your brand association be?  i.e.  what is the one thing, above al

Four perspectives of the balanced scorecard, Four perspectives of the balan...

Four perspectives of the balanced scorecard Customer perspective e.g. what should we do right for our customers and what do they value? Internal perspective e.g. what

Explain about financial analysis, Q. Explain about Financial analysis? ...

Q. Explain about Financial analysis? The objective of financial statements is to provide information to all users of accounts to help them for decision-making.  Note that most

Analyse link between corporate strategy and bottom line, Question 1: "S...

Question 1: "Strategic Corporate Social Responsibility executed well is effective Corporate Social Responsibility". What are the essential elements to take into account in o

Make a list of business goals, Harriet's Fruit and Chocolate Company was es...

Harriet's Fruit and Chocolate Company was established in 1935 in the Pacific Northwest of the United States to ship gift baskets of locally grown peaches and pears to customers in

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