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5.DEPARTMENTATION (What is division? (Profit centre, Subsidiary, SBU),…
5.DEPARTMENTATION
What is division?
Profit centre
Subsidiary
SBU
Functional
Advantages
Pool expertise
Avoids duplication
Facilitate recruitment
Suits centralized business
Disadvantages
Input focused
Communication problem
Vertical barrier
Geographic
Pros
Local decision
Cheaper
Cons
Duplication
Inconsistency
Product/Brand
Disadvantages
Increase Cost
Fail to share resources
Advantages
Accountability
Specialisation
Co-ordination
Customer