What is a Divisional Structure?


Organization Chart

What is a Divisional Structure?

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Irvine, UK
The divisional organization structure can be seen as one type of functional structure, or as a seperate organizational strucure.
It is often broken down into three types:
1. the product divisional structure,
2. the market divisional structure, and
3. the geographic divisional structure.

Multiunit Enterprise
Jaap de Jonge (Editor), Business Consultant, Netherlands
You'll find an indepth article by David A. Garvin and Lynne C. Levesque describing the geographic divisional structure in HBR June 2008, p105-117). Actually the authors call this type "The Multiunit Enterprise" and position it versus the multidivisional enterprise.
Examples of Multiunit Enterprises mentioned in the article include Citigroup, Hertz, Home Depot, Marriot International, UPS, Wal-Mart.
Typical for the multiunit enterprise is:
- it resembles a Russian nesting doll, in that the P&Ls of one level are incorporated in those of the level immediately above.
- also they are characterized by their four levels of field managers: Store Managers, District managers, Regional Vice Presidents and Division Presidents (or SVPs).
Structural Configurations
Mariano Talanchuk, HR Consultant, Argentina
According to Mintzberg, what you describe is a similar to bureaucratic (functional) organization.
Divisional structure is a group of several mechanic (functional) organizations working together as a coordinated entity.
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