'Ranjeet runs a factory of producing denim shirts. The business is doing well and he intends to expand by diversification into denim dresses and denim bags.'

Which type of organizational structure would you recommend for his expanded organization?

Divisional

The correct answer is option 2- divisional.

Ranjeet is leaning towards a divisional structure for his expanded organization because he organize the company into divisions based on the different product lines (denim shirts, denim dresses, and denim bags). This structure allows each division to operate somewhat independently, managing its own resources, production, and marketing.

In a divisional structure, the organisation structure comprises of separate business units or divisions. Each unit has a divisional manager responsible for performance and who has authority over the unit. Generally, manpower is grouped on the basis of different products manufactured.