Question

Under what situation would a multidivisional structure make sense?

a. A large firm with multiple businesses as part of the organization.
b. A large firm focused on runhing a single business with a cost advantage.
c. A large firm focused on running a single, highly differentiated business.
d. A small firm with relatively simple decisions.

Answer 1

A multidivisional structure is suited for large firms with multiple businesses, allowing each division to focus on specific product lines while leveraging the larger organization's resources.

Step-by-step explanation:

Under what situation would a multidivisional structure make sense? The answer is a. A large firm with multiple businesses as part of the organization. A multidivisional structure is beneficial for large organizations that operate various and perhaps unrelated businesses, as it allows each division to focus on its specific product lines or markets while benefiting from the larger firm's resources and brand. Small firms with simple decisions or large firms with a single focus, whether it be cost advantage or differentiation, may not require the complexity of a multidivisional structure, as they can centralize decision-making and streamline processes without the need to separate into distinct divisions.