Which type of structure consists of separate business units based on markets or products?

The divisional structure is characterized by its organization into separate business units based on specific markets or product lines. Each division operates almost like its own company, focusing on its unique market or product group, which allows for greater responsiveness to customer needs and market changes. This structure can improve accountability within each division, as they are responsible for their own performance, including profits and losses.

In a divisional structure, businesses can enhance flexibility and innovation since each unit can adapt its strategies based on the demands of its specific market or product. This structure is particularly useful for large organizations that operate in diverse industries or have a wide range of products, as it allows them to manage their operations effectively while focusing on distinct goals tailored to each division.