A company restructures its operations from an activity

Solution

The activities described—restructuring operations into departments (departmentalisation), defining reporting relationships, and establishing authority—are the core components of the Organising function of management. According to management principles, organising is the process of identifying and grouping work, defining responsibility and authority, and establishing relationships to enable people to work effectively together. 

• Departmentalisation: The transition from an "activity-based system" to "geography-based departments" is a classic example of creating a divisional or departmental structure.
• Authority and Reporting: Establishing "reporting relationships and authority" is a specific step in the organising process designed to create a clear chain of command.
• Structural Framework: Organising provides the framework (structure) within which an enterprise functions as an integrated unit.