Business – 7.1 Organisational structure – Types of structure | e-Consult
7.1 Organisational structure – Types of structure (1 questions)
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A product‑based structure groups activities around each distinct product line, giving each product its own dedicated resources.
- Advantages:
- Greater focus on product development and market responsiveness, because teams are specialised in a single product.
- Clear profit and loss accountability for each product, aiding performance measurement and strategic decision‑making.
- Disadvantages:
- Potential duplication of functions (e.g., separate marketing, finance, HR for each product) leading to higher overhead costs.
- Coordination between product divisions can be difficult, risking inconsistencies in corporate branding or strategy.