Advantages and Limitations of Departmentation by Territories

If a company All India area of operation departmentation is made region wise or statewide or even below that level. This is shown below


1. The Regional Mangers and his staff become experts with regard to their region and customers.


2. They can be familiar with the type of competition and can face it.

3. Local conditions will result in lower cost of operations and opportunities are created to enjoy the benefits of local conditions.


1. This type involves higher cost of coordination and control from head Quarters.


2. It results in more managerial levels and increases overhead costs.