Identification

• Companies with multiple product lines or specific retail divisions can benefit from a product-style organizational structure. This allows the company to create a tall structure divided by product type or style. Each division has its own internal departments and operates like a mini-business.
  
  

Significance

• Using a product organization structure is most common in companies such as retail stores. These organizations will separate out their products by group, such as apparel, appliances, food or electronics. This helps owners and managers run their operations more efficiently.
  
  

Warning

• A significant downside to a product organizational structure is that it can segment the company into divisions that do not work together. Managers may compete with each other in an unhealthy manner that inhibits the natural growth of the business or its ability to achieve goals.