Distinguish between functional and divisional organisational structure on the following basis: (a) Formation, (b) Managerial development,
Distinguish between functional and divisional organisational structure on the following basis:
(a) Formation,
(b) Managerial development,
(c) Responsibility,
(d) Suitability
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| S.No. | Basis | Functional structure | Divisional Structure |
| 1. | Formation | It is based upon functions. | It is based upon product lines and is supported by functions. |
| 2. | Managerial Development | Difficult, as each function manager has to report to the chief manager. | Easier autonomy as well as the chance to perform multiple functions which help in managerial development |
| 3. | Responsibility | Difficult to fix on any one department. | Easy to fix responsibility for performance |
| 4. | Suitability | Suitable for medium sized firms having a single product or small number of related products. | Suitable for large firms having multiple products with distinct characteristics. |
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