1. Power can be decentralized, which is conducive to getting rid of daily affairs and focusing on major strategic issues.
2. The directors of each business department have great autonomy to improve the adaptability of enterprise operation.
3. Each business unit is highly specialized, and the group can even accommodate multiple highly differentiated business units. IT can be an IT division or a mineral division, engaged in peace, military affairs, environmental protection and cigarettes. There is no conflict at all.
4. The business responsibilities and authority of each division are clear, and the material benefits are closely linked to the business situation.
Disadvantages:
1, which will easily lead to overlapping institutions and expansion of managers.
2. Each business department has strong independence, and it is easy to ignore the overall interests of the enterprise when considering problems.
Scope of application of business division system: enterprises with large scale, diversified business, great differences in market environment and strong adaptability.
The business responsibilities of each division are clear, and the material benefits are linked to the operating conditions. However, the disadvantage is that the spillover causes the overlapping of institutions and the expansion of managers. Even the China Division has a great overlap with the parent company in China, and both the parent company and the small division are very small, but their functions are very limited. In addition, each business unit has strong independence, and it is easy to ignore the overall interests of the group.