Discuss whether organisation by system or product is best for monitoring and raising performance,

Organisation of system is where a business is run by functional areas e.g. HR, finance etc, otherwise known as specialism’s, an example of this could be at a supermarket, where staff are separated into different departments like checkouts, produce, café etc. Organisation of product is when a business is organised by ‘profit centres’, where success is monitored by the amount of profit made by each product/store. An example of this would include Coca Cola Ltd, because they own different products such as, Coca Cola, Fanta, and Lilt etc.

With a company like Coca Cola Ltd, its better that they’re organised by product, because they each have separate identities and their own responsibilities with goals & aims specific to that product, meaning that they have complete focus on their product’s performance, sales & profits. This would increase quality and production of the product, and motivation amongst staff because they have less pressure worrying about the other products, leading to a happier workforce and increased sales & profits. Another advantage of products being separated is that they can target their audience more effectively, for example, Powerade and Far Coast. Powerade is targeted at people interested in health and fitness and would most likely be sold in gyms & leisure centres, whereas Far Coast would be looking to sell their products to customers with busy lifestyles, and would be most likely be sold in café’s. However, being product organised has its restrictions, their resources are limited because the organisation itself has to split profit between each product, which may not be enough for the product to expand or keep up with demand from customers. In Coca Cola Ltd’s case they would obviously split profit in ratio to the products demands, for example Coca Cola is the most popular product therefore they need bigger factories and more money spent on...