Explain what a divisional structure is. What are its advantages and disadvantages?

The divisional structure divides the organization into several divisions, each of which operates as a semi-autonomous unit and profit centre. Divisions in organizations can be based on products, customers, or geography. Divisional performance can be assessed because each division operates almost as a separate company. Divisionalized companies can buy, sell, create, and disband divisions without disrupting the rest of their operations. Different divisions can sponsor separate advertising campaigns and foster different corporate identities. They can also share certain corporate-level resources (such as market research data). But sometimes unhealthy competition develops between divisions, or the efforts of one division may be duplicated by those of another, and this increases costs. See Table 7.2 for a list of the advantages and disadvantages of this type of structure.