Question

Six Mark Question:
Explain the concept of 'Functional Structure'. Also, explain any four disadvantages of functional structure.

Answer 1

This is the simplest & the most prevalent form of organizational structure. Functional organisational structure refers to the structure in which different departments are created on the basis of major functions performed in the organisation.

Disadvantages of functional structure are as under:

1. Hindrance in Organisational Objectives: Under functional structure, more emphasis is given on achieving of departmental objectives rather than the overall organisational objectives. Such a practice leads to functional empires and places hindrance in the interaction between two or more departments. Hence, organisational objectives may not get achieved.

2. Ineffective Coordination: Establishing coordination in functionally differentiated departments becomes very difficult.

3. Conflicts: Sometimes, interests of two or more departments may not be compatible. In such a situation, it leads to conflicts among different departments.

4. Inflexibility: It leads to inflexibility in the organisation since people with same skills and knowledge develop a narrow outlook and face difficulty in understanding and appreciating other jobs.