Which organizational structure divides the business based on geographical areas?

The choice that correctly identifies an organizational structure that divides a business based on geographical areas is the worldwide area structure. This structure is designed to give more autonomy to regional managers by organizing the business according to specific geographic regions. Each area can adapt to local needs, cultures, and market conditions, which can lead to greater responsiveness and customer satisfaction in those markets. The worldwide area structure typically focuses on facilitating operations, marketing, and sales strategies that are tailored to different regions, thereby allowing the organization to operate more effectively in diverse environments.

While other structures, like the worldwide product division structure, focus on product lines regardless of geography, the worldwide area structure directly aligns operations and strategy with geographic locations. This structure can be particularly useful in multinational corporations where local market conditions and consumer preferences vary significantly. The global matrix structure incorporates dual reporting relationships and often blends product and geographic lines, while a knowledge network facilitates collaboration and information sharing across different parts of the organization, rather than focusing on geographical distinctions.