Another benefit of the functional organization is that it enables management to segregate work according to functions and thus avoid any duplication of work and also management can allocate the work to the concerned department quickly due to functional specialization. Because staff mainly reports to the functional manager and therefore,the project manager does not have that much power and influence on the project team. Advantages And Disadvantages Of Functional Organization 1174 Words | 5 Pages Functional The functional structure focus on principles of specialization where people will be grouped in broad business activities such as marketing, production, human resources and finance. A functional manager tends to create boundaries around himself and thinks only in terms of his own department rather than the whole enterprise. This type of structure is called a functional organizational structure or line and functional organization. What is Collective Bargaining and Why it is Important to Workers? Workers are surprised by a number of instructions from different functional Heads. This creates confusion in the Enterprise. This decreases the overall efficiency of the employee. The biggest disadvantage of functional organization is that since various departments are segregated on the basis of functions there is no scope of employees of one department helping or meeting the other department employees and hence in a way there are many companies in the form of departments within the company and each department is having separate goal instead of one common goal which can be harmful for the progress of the company in the long run. Functional Organization Structure Main Advantages: Offers a high level of specialization. Disadvantages are that as the company grows, there may be a lack of integration across the different functions or departments leading to inefficiencies. advantages and disadvantages of organizational structure Uncategorized December 5, 2020 0 Comment Related: 12 Qualities of Effective Leadership in an Entrepreneur. Thus, Thereby bringing expertise in performance and reduction in costs.eval(ez_write_tag([[580,400],'googlesir_com-large-mobile-banner-2','ezslot_9',108,'0','0'])); Related: 19 Factors Influencing Entrepreneurship Development. Thus, Now you understood the concept of advantages and disadvantages of functional organizational structure.eval(ez_write_tag([[336,280],'googlesir_com-mobile-leaderboard-1','ezslot_14',111,'0','0'])); THANK YOU SO MUCH THIS HAS HELPED ME A LOT. Merits of functional organization: The following are the merits of functional organization. Disadvantages of Functional Organizational Structure The work can be quite one dimensional. When a company uses this type of structure, it groups its people according to their knowledge and skills which help them become specialists on … Notify me of follow-up comments by email. Another disadvantage of the functional organization is that if some work requires the intervention of two departments then it may be delayed due to lack of coordination between the departments which in turn will lead to the company losing its competitiveness with respect to competitors. Disadvantages of Functional Organization The disadvantages are as mentioned below. Disadvantages of the Functional Structure The functional structure also has inherent disadvantages. It reduces the burden on the top executives. Disadvantages of Functional Organizational Structure Following are the disadvantages of functional organizational structure: 1. This facilitates better executive development. They always give more importance to their departmental objectives. The lack of new challenges can make them unenthusiastic for the job at hand. Cooperation and communication between departments and units may be poor. A number of my blog readers have complained about my blog not operating correctly in Explorer but looks great in Chrome. sample functional organizational structure chart. When nearly similar skilled people are working together, conflicts may arise when one employee is promoted whereas others are not. 13 Factors Affecting Structure of Sales Organization. Wherever The function of the person may be located in the enterprise. Another benefit of a functional organization is that it leads to more efficiency and speed of work because a specialist who is the expert in his or her field is likely to do the task much efficiently and effectively than normal people. So for example, if marketing department requires some IT support for marketing of the new product and IT department is slow to respond then the whole process of marketing of a product can be a failure leading to a loss for the company. There may be a lack of understanding as to how significant that specific are to the company. Lack of teamwork and reduced flexibility may cause conflicts between departments and units. It violates the principles of unity of command since a person is accountable for more than one bosses. On the whole, This type of organization has been quite successfully followed in an enterprise like banks, insurance companies. So, for example, a normal person is likely to take more time in taking the decision regarding finance related matter than a financial analyst handling the finance department. In order to understand this better let’s look at some of the advantages and disadvantages of functional organization –. Following are the important advantages of functional organizational structure: The functional organizational structure helps in achieving the benefits of specialization of work.eval(ez_write_tag([[300,250],'googlesir_com-box-4','ezslot_8',120,'0','0'])); Every functional in charge is an expert in his area and can help the subordinate to perform better in his area. The employees will be receiving instructions from all 8 foremen which will cause confusion in employees. In this article, we discuss the advantages and disadvantages of the functional structure, plus eval(ez_write_tag([[250,250],'googlesir_com-medrectangle-4','ezslot_2',101,'0','0']));eval(ez_write_tag([[250,250],'googlesir_com-medrectangle-4','ezslot_3',101,'0','1']));It confers upon the holder an unlimited power of command over the people of other departments concerning their function. Advantages and Disadvantages of the Functional Organization Structure The Functional Organization Structure can be successfully applied in many areas. Disadvantages of a Functional Organizational Structure In the long term, employees tend to feel bored and the monotony of the job can be off-putting. Advantages of Functional Organization 1.Facilitates specialization 2. This can result in mismanagement and discord. Benefit of Specialization This system provides ample opportunities for minute specialization to its maximum extent. 1. There is a general lack of coordination among the functional executives which causes the delay in decision making. Another disadvantage of functional organization structure is that these functional groups may not be able to communicate more often which decreases flexibility and innovation. Hence Related: 13 Factors Affecting Structure of Sales Organization. It helps in maintaining ability and uniformity in the performance of functional areas throughout the Enterprise. Every organization should review these matrix organizational structure advantages and disadvantages to see if this approach might offer usefulness. Thus, The employees in purchase functions are restricted in several ways by the financial manager and quality control manager also. 2. This type of structure is called, Advantages and Disadvantages of Functional Organizational Structure. Indeed, this type of structure is the most rigid of all possible structures. The benefits of the functional organization structure made it spread widely in the contemporary management. eval(ez_write_tag([[300,250],'googlesir_com-large-mobile-banner-1','ezslot_6',123,'0','0']));This facilitates better executive development. Related: Top 15 Characteristics of Creativity (Creativity as a skill). Do you ever run into any internet browser compatibility problems? It is a means of putting the specialists in top postings throughout the enterprise. The departmentalizing of specializations leads, in some cases, to decisions made to benefit a department rather than the organization goals. Organizational Structure Type #2: Projectized Organization There will be lack of … Disadvantages No one “manages” a certain project, a project is managed by multiple functional managers, this can lead to the following: The client is not able to know what the status of the project really is, as no one can give him the whole picture. But for the division of work within the departments themselves, The structure has not been found to be very successful mainly because there is no clear line of authority. Main disadvantages of functional organisation: (1) Ignorance of Organisational Objectives: Each departmental head works according to his sweet will. There will be lack of understanding across departments. As one can see from the above that functional organization has both advantages as well disadvantages and any company thinking of adopting this type of structure should carefully analyze both the aspects and then take the decision. Disadvantages of Functional Organizational Structure. In this type of organization, the emphasis is on managing some functions wherever the function may be performed in the enterprise. (functional organizational structure). So for example, if in any company which has a functional organization in place and it has divided the department as IT department, finance department, marketing department, purchasing department and so on then any problem related to purchasing department will be handed over or solved by purchasing department only and not by any other department. Another disadvantage of functional organization structure is that these functional groups may not be able to communicate more often which decreases flexibility and innovation. The following are some disadvantages of the functional organization structure: 1. List of the Advantages of the Matrix Organizational Structure 1. 1) No unity of command. He will have an official command or formal power finance function and perform it. When staff Specialists are incorporated into the organization and are placed upon the same (line) Authoritative level as the line executives. Problems may arise among management if department heads are only focused on their department and do not communicate effectively with other departments. Function authority remains confined to functional guidance to different departments. eval(ez_write_tag([[336,280],'googlesir_com-medrectangle-3','ezslot_1',105,'0','0']));One manager would be responsible for each of these functions separately, which means that the finance manager would be responsible for financial activities and would have direct command over all such activities carried out in the enterprise. Functional organizational structures are not nimble, flexible or easily adaptable. Matrix Organizational Structure Businesses working on a specific project could also have a matrix organizational structure that sets up the relationship among the people working on the project. After a while, the employees may start feeling monotony or boredom. 3. Disadvantages In functional organization, each group perform their duties independently from other functional groups, but sometimes that can fail. The functional organizational structure is a particular type of organization in which a company can decide to organize itself. Required fields are marked *. Disadvantage – Organizational Disunity In theory, organizations pursue a goal or goals as a unified team. Lack of teamwork and reduced flexibility may cause conflicts between departments and units. Conflict in Authority: Top 15 Characteristics of Creativity (Creativity as a skill), 19 Factors Influencing Entrepreneurship Development, 12 Qualities of Effective Leadership in an Entrepreneur, 11 Nature and Scope of Marketing (With Examples). 2. When a decision problem requires the involvement of more than one specialist.eval(ez_write_tag([[728,90],'googlesir_com-leader-4','ezslot_12',115,'0','0'])); Related: 11 Nature and Scope of Marketing (With Examples). Thanks so much for your work. Enter your email below to get access to Our All helpful Tips and Articles, When staff Specialists are incorporated into the organization and are placed upon the same (line) Authoritative level as the line executives. As the company starts growing, the departments also become larger. In this article, we are going to review the advantages and disadvantages of each organizational structure: Functional, Projectized, and Matrix. Employees are Functional organization, as the name suggests, refers to that organization in which departments are created according to functions or specialization so that any matter related to the particular function is dealt by that particular functional department only and not by other departments. A functional manager is required to have expertise in one function only. Thus, Now you understood the concept of advantages and disadvantages of functional organizational structure. Your email address will not be published. This may create the problem of succession in top executives. It offers greater scope for expansion as compared to line Organisation. There is a very low level of communication between the two departments, and it results in p… The disadvantages of Functional Organization: The functional organization may have unhealthy competition working with the other areas. Since the employees are grouped by their knowledge and skills, competition may arise between them. Functional organization structure is optimal for small businesses or companies producing standardized goods or services. The last disadvantage of the functional organization is that the project manager has little or no authority. Ensures effective supervision Disadvantages of Functional It does not face the problem of Limited capabilities of a few line managers. The functional organizational structure helps in achieving the benefits of specialization of work. READ MORE on www.slideshare.net The Advantages & Disadvantages of a Mixed Model Approach This can cause poor communication and \"silos\" that are too independent from one another. I’m really loving the theme/design of your web site. There is pointed supervision in the enterprise, and every function in charge looks after his functional area only. Complexity The operation of the functional organizational structure is, complicated and is not easily The disadvantages of the functional organization are as follows- 1. 4. This is a functional organizational structure chart. Each one of them becomes a small company in itself because of the number of people working in it. 2. There is a general lack of coordination among the functional executives which causes the delay in decision making. They focus more on their own goals and neglect the overall company objectives. Your article is very useful for understanding the organizational structure , it contains supporting materials for each specialist. One manager would be responsible for each of these functions separately, which means that the finance manager would be responsible for financial activities and would have direct command over all such activities carried out in the enterprise. Expertise The expert knowledge of the functional managers facilitates better control and supervision in the Enterprise. The inter-department communication is very poor … Employees may find it boring to repeat the same task over and over, and become less enthusiastic over time. Benefits of large-scale operations 3.Facilitates effective coordination 4. It confers upon the holder an unlimited power of command over the people of other departments concerning their function. Advantages and disadvantages of projects in Functional organization Advantages Specialization—It. For the division of work into various departments. 17 Factors Affecting Economic Environment, Privatization: Meaning, Features, Scope, Objectives, 18 Nature and Characteristics of Entrepreneurship, Branch Accounts: Meaning, Definition, Types, 14 Elements of Good and Effective Planning (How its work), External Environmental Analysis: Meaning, Features, Need & Importance, Top 10 Characteristics of Good and Ideal Project Planning, 20 Types of Entrepreneurs (Informative Explained), 18 Key Success Factors in Retail Business (With Examples). eval(ez_write_tag([[250,250],'googlesir_com-leader-3','ezslot_11',124,'0','0']));The expert knowledge of the functional managers facilitates better control and supervision in the Enterprise. Function of the functional managers facilitates better control and supervision in the performance functional. Here are the major disadvantages you must consider: create your own Org Charts expertise in one function only conflicts! 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