Product Organisational Structure - Advantages and disadvantages table in A Level and IB Business

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Created by: ccorr
Created on: 06-05-20 13:25

Product Organisational Structure

Advantages

1. Improves communications between different functional experts within each product division.
2. Allows a business to adapt different products more easily in response to customer needs.
3. Allows each division to focus on its own customers.
4. Monitor product performance- the business can monitor the performance and profits for each product unit.

Disadvantages

1. There can be wasteful duplication of management functions (marketing, finance, etc) for each product division.
2. There may be wasteful competition for the same customers between different product divisions.
3. Poor communication between the product units may result in the business missing opportunities in the market.

Evaluation

Many large companies with a range of products use this structure for example Samsung.

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