What Is Divisional Organization Structure?

In a divisional organizational structure, employees are configured into groups and every group is responsible for one product or service. Separate teams focusing on a single product help organizations achieve their strategic objectives swiftly.

Divisional structures have their own presidents and vice presidents. As a result, it becomes easier for departments to receive appropriate resources for timely completion of projects. Substantial resources at hand greatly augment employee morale and introduce a culture of efficiency and competitiveness.

Weaknesses of divisional structure include departments competing for resources instead of focusing on the strategy and goals of the organization. Divisional structure creates room for office politics, which increases hostilities amongst employees of different departments.

There are various examples of divisional structures in famous organizations like General Motors and Microsoft. Bank of America has various divisions, from asset management to retail and commercial divisions.