Which organizational structure tends to improve focus on products and customers but may lead to resource inefficiency?

The divisional organizational structure is designed to enhance focus on products and customers by breaking the organization into semi-autonomous units, each responsible for its own product line or market segment. This structure allows for specialization and encourages teams to develop expertise in their respective areas, which leads to a better understanding of customer needs and product requirements.

However, while it enhances product and customer focus, this structure may result in resource inefficiencies. Each division often operates independently, which can lead to duplication of functions across divisions, such as marketing, accounting, and human resources. This redundancy can increase overall operational costs and decrease the ability to efficiently utilize resources across the organization, as divisions may compete for the same resources and expertise.

In contrast, other organizational structures like matrix or functional may lead to better resource allocation and efficiency but can compromise the direct focus on specific products and customer groups. Team-based structures can also emphasize collaboration and flexibility, but they may not provide the same level of product-focused accountability seen in divisional settings. Therefore, the divisional structure’s dual focus on product/customer orientation and potential inefficiencies is clearly highlighted by this choice.