CASE STUDY: Read the following text and answer questions on the basis of the same
A company Jeenat ltd. manufacturing cosmetics, which has enjoyed a pre-eminent position in
business, has grown in size. Its business was very good till 1991. But after that, new liberalized
environment has seen entry of many MNC's in the sector. With the result the market share of
Jeenat ltd. has declined. The company had followed a very centralised business model with
directors and divisional heads making even minor decisions. Before 1991 this business modelserved the company very well as consumers had no choice. But now the company is under
pressure to reform.
Q17). Which organisational structure is suitable for company 'Jeenat' ltd.'?
a) Functional structure c) Formal organisation structure
b) Divisional structure d) Informal organisation structure. (1)
Q18). What organisation structure changes should the company bring about in order to retain its
market share?
a) It should adopt functional structure c) It should adopt divisional structure
b) It should adopt centralisation d) It should adopt decentralisation. (1)
Q19). How will the changes suggested by you help the firm?
a) It will help in increasing managerial and operational efficiency, resulting in increased profits.
b) It will facilitate expansion and growth as new divisions can be added without interrupting the
existing operations by merely adding another divisional head and staff for the new product line.
c) It will help in quick decision making since decisions will be taken at levels which are nearest
to the points of action.
d) It will facilitate effective management. (1)
Q20) ________explains the manner in which decision making responsibilities are decided
among hierarchical levels
a) Delegation c) Authority
b) Decentralisation d) Accountability
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