The Different Types Of Organization Structures: Functional Structure

Append below describes the advantages and disadvantages of the following type of organization structure:

· Functional Structure

· Divisional Structure

· Matrix 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:


· 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

Refer to other articles: Divisional Structure & Matrix Structure

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