Departmentalization based on the goods or services produced or sold by the organizational unit.

• A. Product Departmentalization
• B. Process Departmentalization
• C. Functional Departmentalization
• D. Geographic Departmentalization

Answer: (A)

When the structure is built around the goods or services a unit offers, departments are organized by product lines. Each product has its own team responsible for all the activities needed to bring that product to market, from development through marketing and support. This aligns decisions and resources with the specific needs of each product, makes it easier to track product performance and profitability, and lets managers tailor strategies, processes, and services to the distinct requirements of each product.

This approach fits the description of departmentalization by product, as opposed to organizing by the steps of production (process), by specialized function across products (functional), or by geographic location. It’s especially useful when products are diverse and demand specialized focus, though it can lead to duplication of some functions across products and potentially more coordination overhead.