Which of the following is true in the co

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Target Exam

CUET

Subject

Business Studies

Chapter

Organising

Question:

Which of the following is true in the context of organising function of management?

Options:

Functional structure is based on product lines

Divisional structure is based on functions

Both 1 and 2

None of the above

Correct Answer:

None of the above

Explanation:

The correct answer is option 4- None of the above.

Both statement is false. Functional structure is based on functions and divisional structure is based on division.

Comparative view: Functional and Divisional Structure

S No	Basis	Functional Structure	Divisional Structure
1	Formation	Formation is based on functions	Formation is based on product lines and is supported by functions.
2	Specialisation	Functional specialisation	Product specialisation
3	Responsibility	Difficult to fix on a department	Easy to fix responsiblity for performance
4	Managerial Development	Difficult, as each functional manager has to report to the top management	Easier, autonomy as well as the chance to perform multiple functions helps in managerial development
5	Cost	Functions are not duplicated hence economical	Duplication of resources in various departments, hence costly
6	Coordination	Difficult for a multi-product company	Easy, because all functions related to a particular product are integrated in one department