Question : Ramesh is the owner of a factory that makes locks. He produces locks for use in homes. He wants to grow his company. He intends to do this by getting into the production of motorcycle and auto locks. He will determine whatever form of organisational structure for his factory.
Option 1: Functional structure
Option 2: Divisional structure
Option 3: Formal organisational structure
Option 4: Informal organisational structure
Correct Answer: Functional structure
Solution :
He will decide on a "Divisional Structure" for his factory because it produces multiple goods. Divisional structure has the following benefits: I Product specialisation aids in the development of a wide range of talents. (ii) It aids in establishing accountability for divisional leaders who are responsible for the revenues, earnings, and expenses associated with their departments It encourages adaptability, initiative, and quicker decision-making because each section operates independently. (iv) It promotes development and expansion because new divisions can be introduced without affecting current operations. (v) Because all activities pertaining to a specific product line are integrated together, it lessens the issue of coordination between departments.
Hence, the correct option is 1.
