A consumer products firm with a functional structure is expanding from a single product line into several diverse product groups, with most sales within the one country. What form of departmentalization should it eventually adopt to manage the new conditions most effectively?
A)Matrix structure
B)Network structure
C)Geographic divisional structure
D)Keep the functional structure
E)Product divisional structure

Question

Quizplus · Accepted Answer

As the firm is expanding into several diverse product groups, adopting a product divisional structure would be the most effective way to manage the new conditions. This allows the firm to group products based on similarity, with each division having its own resources, staff, and operations. Since most sales are within one country, a geographic divisional structure may not be necessary. The matrix structure and network structure are better suited for organizations with complex and diverse operations that require coordination between various functional departments, which may not be the case for this firm. Keeping the functional structure would not be effective in managing multiple product groups.

A Consumer Products Firm with a Functional Structure Is Expanding