Question

Distinguish between: Functional and Divisional Structure on the basis of the following points: 

(i) Co-ordination 

(ii) Managerial Development and 

(iii) Cost 

Answer 1

Difference between Functional Structure and Divisional Structure.

Basis	Functional Structure	Divisional Structure
Co-ordination	Very difficult for a Multi Product Company	Less Difficult because of Functions related to a particular Product are Integrated in the Product Divisions
Managerial Development	Difficult because of Narrow Functional Specification.	Functional Specification . Easier because Autonomy to Perform Multiple Functions is given to Divisional Heads
Cost Factor	Economical, as Functional Departments are Not Duplicated	Costly, as each Division has to Create its Cross Functional Departments.