Question

A company engaged in manufacturing of a popular brand of toys, has been enjoying good market reputation. It has separate departments for Production, Marketing, Human Resources and Research and Development. Lately, to extend its brand name and also to move on the new business opportunities, it is thinking to diversify into manufacturing of a new range of electronic toys like mini computers and laptops. Identify the type of organisational structure applicable in the above case:

Options

• Functional Organisation Structure

• Divisional Organisation Structure

• Line Organisation

• Line and Staff Organisation

Answer 1

Functional Organisation Structure

Explanation:

Since the company is expanding into a new product line (electronic toys), it needs to manage the new range separately to maintain focus, accountability, and efficiency. Hence, shifting or adopting a Divisional structure would be most appropriate to support the new line of business.