What is meant by functional structure of an organisation? Explain any two of its advantages and limitations.
What is meant by functional structure of an organisation? Explain any two of its advantages and limitations.
Functional structure involves grouping of employee positions into departments as the organisation's functions. Thus, each department will have specialised and similar skills and expertise, work activities and resource use.
Advantages of a functional structure are :
(i) In-depth development of expertise: Employees with specialised skills can be managed by an authority with certain experience in that speciality. Accordingly, the Fit person in authority can understand and review their subordinates' work and ensure high productivity in the business unit.
(ii) Ease of coordination within function: The chain of command is linear and coordinated between every employee knowing their lines of communication within their teams, between sub-units and with the centralised authority.
Limitations of Functional Structure :
(i) Backlog of decisions: Backlog means an accumulation of uncompleted work. As decisions are largely concentrated at the superior or top management, the backlog could lead to possible losses for which the top management may be held responsible.
(ii) Problems during sequential tasks: Employees of specialised business units may be unaware or uninformed about activities in other units. Employees will not be able to understand the priorities and/or initiatives in other units.
Functional structure involves grouping of employee positions into departments as the organisation's functions. Thus, each department will have specialised and similar skills and expertise, work activities and resource use.
Advantages of a functional structure are :
(i) In-depth development of expertise: Employees with specialised skills can be managed by an authority with certain experience in that speciality. Accordingly, the Fit person in authority can understand and review their subordinates' work and ensure high productivity in the business unit.
(ii) Ease of coordination within function: The chain of command is linear and coordinated between every employee knowing their lines of communication within their teams, between sub-units and with the centralised authority.
Limitations of Functional Structure :
(i) Backlog of decisions: Backlog means an accumulation of uncompleted work. As decisions are largely concentrated at the superior or top management, the backlog could lead to possible losses for which the top management may be held responsible.
(ii) Problems during sequential tasks: Employees of specialised business units may be unaware or uninformed about activities in other units. Employees will not be able to understand the priorities and/or initiatives in other units.
