Advantages and disadvantages of functional organisational structure?

Answer 1

FUNCTIONAL STRUCTURE

Salient points:

· Functional structures typically work well for smaller and less complex organizations dealing with only one or a few products or services.

· Also work best in relatively stable environments that allow organizations to pursue consistent strategies.

Major Advantages of Functional Structure:

The major potential advantages include:

· economies of scale with efficient use of resources

· task assignments consistent with technical training

· high quality technical problem solving

· in-depth training and skill development within functions

· clear cut career paths within functions

Major Disadvantages of Functional Structure:

Include:

· poor communication and coordination across functions,

· having too many decisions referred upward in the hierarchy,

· a loss of clear responsibility for product or service delivery, and slow innovation in response to environmental changes.

· One of the most serious disadvantages occurs when members of functional departments become overspecialized, develop self-centered, narrow viewpoints, and lose the total system perspective.

· Failure to communicate and extend support across department lines is common in such situations. This often slows decision making because problems must be referred up the hierarchy for resolution