What organizational model involves grouping employees together based on factors like geography or demographics?

The divisional arrangement is an organizational model in which employees are grouped together based on specific factors such as geography, product lines, customer types, or demographics. This model allows companies to create semi-autonomous divisions that can respond more quickly to market changes and customer needs, as each division operates relatively independently. By organizing teams according to these specific characteristics, organizations can enhance their ability to cater to particular segments of the market, streamline operations, and improve accountability.

In contrast, functional arrangements focus on grouping employees based on specialty or function, such as marketing, finance, or human resources. A matrix structure combines different types of organizational structures and often includes cross-functional teams working toward common goals, which can create complexity in reporting relationships. The team-based approach emphasizes collaboration among employees who may come from different departments but do not necessarily group by the criteria mentioned for the divisional model. Each of these other organizational structures has its own benefits and is suitable for different circumstances, but they do not center on grouping employees by geographic or demographic characteristics in the same way as the divisional arrangement does.