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Business Studies · 2025 · 4 marks
CBSE 2025 · Region 5 · Set 1 · Q27
'Smart Aids' was a reputed company manufacturing e- walking sticks. It is now providing e-walking sticks with sensors or voice feedback for helping…
'Smart Aids' was a reputed company manufacturing e-
walking sticks. It is now providing e-walking sticks with sensors
or voice feedback for helping people with vision or mobility
issues to move around more safely and easily. The company has
been earning good profits.
After its great success, it wants to diversify and enter into the
manufacturing of high-class smart watches. These smart
watches will help older people to live independently and safely
while staying connected to their loved ones. These smart watches
would also monitor their health by sending emergency alerts,
reminding them to take medicines, etc. and help in managing
their health issues. It will encourage physical activity and offer
voice assistance for easy use and keep them connected with
family through calls and messages.
Though there are very homogeneous functions in both the
products, they set up a separate business unit for these watches.
Both units will have separate managers responsible for the
performance of their units and have authority over the unit.
Each manager would be accountable for profits, revenues and
costs of their unit. This type of organisational structure would
help the organisation to add new units without interrupting the
existing operations.
(i)
State the type of organisational structure suitable for 'Smart
Aids' giving reason in support of your answer.
(ii)
Give two advantages of the organisational structure, which
are highlighted in the above case.
Marking-scheme solution
(i)
The divisional structure comprises of separate business
units or divisions, each unit having a divisional manager
responsible for performance and who has the authority over the
unit.
Reason : This structure is suitable where a large variety of
products are manufactured using different productive resources.
(ii)
Advantages of Divisional Structure:
(a)
Divisional heads are accountable for profits, as revenues
and costs related to different departments can be easily
identified and assigned to them.
(b)
It facilitates 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.
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CBSE Class 12 Business Studies past-paper question from the 2025 board exam, with the answer as CBSE’s own marking scheme gives it. Where our answers come from.