Departmentalization is the process of grouping activities or people into departments based on a particular set of criteria. The purpose of departmentalization is to create manageable units that facilitate coordination and control, and to promote specialization and efficiency in the workplace. There are several types of departmentalization, including:

• Product departmentalization: Grouping activities by product line or service, thus placing all activities related to the product or service under one manager. Each major product area in the corporation is under the authority of a senior manager who is responsible for everything related to the product line.

• Process departmentalization: Grouping activities on the basis of product or service or customer flow. Because each process requires different skills, process departmentalization allows homogeneous activities to be grouped together.

• Customer/market departmentalization: Grouping activities according to specific markets or customers. This is common in organizations that produce products or services for specific markets or customers, and it helps managers better understand the needs and wants of their target market.

• Divisional departmentalization: When the firm develops independent lines of business that operate as separate companies, all contributing to the corporation profitability, the design is called divisional departmentalization or (M-FORM) .

Departmentalization helps managers maintain control by grouping employees into departments, making it easier for managers to oversee the activities of their subordinates, delegate authority more effectively, and hold employees accountable for their actions. It also helps improve efficiency and productivity by facilitating specialization and coordination among employees.