What is a division system? What are the characteristics of the division system? What kind of enterprise is it suitable for?

Division system is a common form of organizational structure, which originated and was first applied to general companies in America. Division structure is also called branch structure. Division system is an organizational structure form that adapts to the requirements of enterprise scale expansion and diversified management for organizational structure. The specific design idea is to set up multiple business divisions under the leadership of the head office, combine decentralized management with independent accounting, and divide business divisions according to products, regions or markets (customers), that is, business divisions. Each division has its own products and specific markets, and can complete all functions of a product from production to sales. The division is not an independent legal person enterprise, but it has greater business authority, implements independent accounting and is responsible for its own profits and losses. From the business point of view, there is little difference between the division and the general company.

Main features:

I. Professional management departments

According to the combination of business activities produced by enterprises, a professional production and operation management department, namely the business department, is established. If there are many kinds of products, each product can form a large enterprise in its own market, and several business departments can be set up according to the products. All business activities related to products, such as design, production, technology, sales and service, are organized in this product department, which is responsible for it; In the case of wide sales area and scattered factories, enterprises can divide business divisions by region; If the types of customers and markets are different, business departments can also be set up according to customers (markets). In this way, each business department has its own whole production and operation process of products or services, and contributes a profit to the enterprise.

Second, different policies and operations.

In the vertical relationship, according to the principle of "centralized policy and decentralized management", the relationship between senior leaders of enterprises and business departments is handled. Relationship, the implementation of the division system. To implement the business division system, the top leadership of an enterprise should get rid of daily administrative affairs, concentrate on studying and formulating various business strategies and policies for enterprise development, and delegate the maximum management authority to each business division, so that it can operate completely independently according to the business objectives, policies and systems of the enterprise and give full play to its enthusiasm and initiative. For example, after the reorganization of General Motors according to Sloan model, the cars sold by each department are within the price range set by the company, and other than that, each department is completely independent.

Third, independent accounting profits.

Horizontally, all business divisions are profit centers, which conduct independent accounting. That is to say, the implementation of business division system means introducing market mechanism into enterprises, and the economic exchanges between business divisions will follow the principle of equivalent exchange to form commodity currency relations.

Fourth, the functional structure organization.

The top management of the enterprise and the interior of the division still carry out organizational design according to the functional structure. For the high-level organizations of enterprises, in order to realize decentralization under centralization and improve the economy of the whole enterprise management, some functional departments should be set up according to specific conditions, such as fund supply and management, scientific research, legal consultation, public relations, material procurement and so on. For business departments, in order to run their own business well, it is also necessary to establish management institutions. Because of small scale and single product, functional structure is generally adopted. It can be seen that the main difference between the business division system and the functional system structure lies in whether the first-level department under the top leadership of its enterprise is set according to the business part or the functional part.

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