functional organization advantages and disadvantages

Before publishing your articles on this site, please read the following pages: 1. So many persons are involved in completing a work and everybody tries to blame others for low performance. Prohibited Content 3. A disadvantage is that employees are responsible to their project team as well as to their functional areas. Specialization leads to operational efficiencies and enhances productivity levels. Some of the advantages of a functional structure include better skill development, a clear chain of command, expedited decision making, qualified supervision and specialized organizational results. Both functional and project manager roles can be outlined in the matrix organizational structure. The work is performed by those who have the specialist knowledge of that work. Conflict in Authority: ADVERTISEMENTS: The principle of ‘unity of command’ is violated in functional … 2. Functional managers oversee entire departments of an organization. This is where the organization is divided into smaller groups based on its special functions such as IT, finance or marketing. 3. This departmentalization allows greater operational efficiency because the employees have their skills and knowledge to be shared within the group. Each one of them becomes a small company in itself because of the number of people working in it. Functional organisation has the following advantages: 1. The workers have to obey many bosses, their loyalty becomes divided. The functional organization provides wide scope for growth and mass production. Matrix Structure. A subordinate is answerable to many bosses. Functional areas may become distracted by their own goals and focus on them, rather than on overall company objectives. : #4355. Project organisation structure. There will be lack of understanding across departments. Disadvantages of Projectized Organization Authority and power can make. Specialists try to give more importance to their work as compared to other areas. What are the advantages and disadvantages of Organisational structure? The consolidation of activities leads to optimum use of facilities like office accommodation, plant and machinery, etc. 3. Coordination of activates within the departments is easy. Following are the disadvantages of functional organization: The principle of ‘unity of command’ is violated in functional organization. One of the advantages of a functional organization is that grouping employees by specialization ensures that employees are dependable and it also creates a health competent work place. Disadvantages of Functional Architecture As with any school of thought, there are disadvantages to a functional approach as well. A number of specialists are appointed for manning various lines of work. If the tasks are segregated according to separate divisions or product categories, such organizations are divisional organizations. 4. Since there is no unity of command, it becomes difficult to fix responsibility for slackness in work. Complexity. There may be a lack of understanding as to how significant that specific are to the company. Because resources specialized in one area, report to the same manager who knows the domain or area as well. Report a Violation, Line Organization and Functional Organization | Difference, Functional Organization: Meaning, Merits and Demerits. This decreases the overall efficiency of the employee. The lack of new challenges can make them unenthusiastic for the job at hand. Each employee will report to his direct functional manager. Every superior is an expert in his own area and he will be successful in making proper planning and execution. As principle of unity of command is not followed, there are conflicts among staff experts and line … This structure makes it easier to share resources in different divisions. As the company starts growing, the departments also become larger. Another weakness of functional organizational structure is there could be lack of unit coordination. The team members work with other people in the field and it allows sharing of thoughts and knowledge to make the people learn new skills. Disadvantages of a Functional Organizational Structure. The departments have a self-centered mentality. The staffers have the chance to get promoted within their functional areas which can be a reason for them to stay long term. The speed or action tends to be hampered by the division of authority. All of the companies define its organizational structure to determine the reporting relationships that will exist in the company. READ MORE on www.slideshare.net. The inter-department communication is very poor this creates an overall lack of growth as an organization. Another disadvantage of functional organization structure is that these functional groups may not be able to communicate more often which decreases flexibility and innovation. READ MORE on … Separate areas are established to take care of different concerns. Disadvantages of Functional Organizational Structure The work can be quite one dimensional. The superiors being well acquainted with the work, they will be able to improve the level of supervision. It also requires a management system which allows promotion, development and visibility of skills of people in each functional area.  As the organization grows bigger, functional areas become difficult to manage. Organizations choose their organizational structure based on many factors like: size, its geographic location, the manner of delivering different products and services that they will offer. The employment of specialists at various levels of work enables the organization to grow as per the needs of the situation. This type of organisation eliminates one man control. Multiplicity of experts increases overhead expenses of the organization. One of the most significant advantages of the matrix organizational structure is its ability to share highly-skilled resources. Team members report to only one supervisor. Feb 19, 2018. Lack of teamwork and reduced flexibility may cause conflicts between departments and units. Copyright 10. This will reduce communication channels. Such a design is typically the first type of organizational structure that any company forms. In one example, there may be a request from the marketing department which may not be prioritized in order to attend to the concerns of the sales department by adding more people. Communication in organizations with functional organizational structures can be rigid. In the long term, employees tend to feel bored and the monotony of the job can be off-putting. The company is getting the advantage of their expertise and knowledge. And hence, as functional organisation provides all the essentials needed by a big enterprise, it befits exactly with them. The appointment of several specialists creates problems of co-ordination, especially when the advice of more than one is needed for taking decisions. The disadvantages of Functional Organization: The functional organization may have unhealthy competition working with the other areas. Firstly, when the specialist workers of a particular field are in a group together in a functional division, there are high chances that the function will be successful and the organization will be successful, ultimately. Functional Organization: Advantages and Disadvantages of Functional Organization! An organization that has a management structure of sharing functions is called functional organization. The basis of this functional organization structure is an arrangement where a worker has different managers for different areas of the organization operation. The functional organization may have unhealthy competition working with the other areas. Image Guidelines 5. It helps to bring in-depth knowledge and skill development among the employees to achieve the goals of the company. The operation of the functional organizational structure is, complicated and is not easily … They focus more on their own goals and neglect the overall company objectives. Functional Organizational Structure Introduction – Advantages and Disadvantages Organizational Chart Skills No Comment Rosie When referring to the functional organizational structure , employees are grouped based on their roles and functions, resulting in functional units … Each department can be staffed by experts in that functional area. This can be an ideal structure for small businesses that focus on one product or service because you can maximize performance by encouraging peer cooperation among different units at various levels of management through supervision and coordination. Employees may get bored because they do the same repetitive type of work all the time. Small units cannot afford to have functional organization. Functional managers pay more attention to their own departments and ignore others’ interests. By creating a functional organizational structure, people can specialize in particular domains. The workers feel confused and are unable to decide about the priorities of their work. Functional structure has some disadvantages as well, including:  People specialized in certain functions may find difficulties in understanding other functions and hence they are reluctant to change. Demerits of Functional Organization: (1) It Gives Rise to Complex Relationships: In a functional organization, there are many cross-relationships between individuals and departments. Top executives are not unnecessarily burdened as happens in line organization. For instance, there may be a … There is a division of labour up to manager level. One advantage of the matrix organizational structure is that people across different functional areas have a better understanding of their coworkers in other areas. On the contrary a specialist is a master of his line and he has the expertise and capability of taking his own decisions. The division of authority creates problem of discipline. Because the people in the functional organization are grouped according to their special set of skills, roles or task, the entire team will operate well. It can shift between the needs of the various projects under development and the company’s functional units. It will lead to poor communication and coordination across functional units. Since the employees are grouped by their knowledge and skills, competition may arise between them. A highly skilled employee costs more. There are several advantages of functional structure too. Disadvantages of functional departmentalization. Outlined in a grid fashion, the functional managers and project managers are role-specific and are included within the matrix. The matrix structure is a type of organizational structure in which individuals are … The span of supervision can also be adjusted according to the requirements. By closing this message you are agreeing to our, The team is managed by an experienced person with a high. One advantage of the matrix organizational structure is that people across different functional areas have a better understanding of their coworkers in other areas. This site uses Akismet to reduce spam. Functional Organization Advantages and Disadvantages. Plagiarism Prevention 4. The people operating under an organization has developed innovative ways and approaches on how... Management Square is a service provider company specialized in Strategy Execution, Business Transformation, and Portfolio, Program and Project Management. The workers get guidance from expert supervisors and this enhances their performance at work. If an organization gets larger, it will be difficul This helps to increase the overall efficiency in the organization. Disclaimer 9. A functional organization groups workers together and has a hierachial reporting system. As the size of the enterprise increases so does need for specialisation. Privacy Policy 8. Accountability and performance become increasingly difficult to monitor. They focus more on their own goals and neglect the overall company objectives. Employees may feel bored because of repetitive work. 2. In instances where organizations have a silo-based approach to transition thinking to leverage functional enterprise architecture, significant transformation is required to implement enterprise operating models and significant organizational change . Advantages & Disadvantages of Different Organizational Structure Types. The involvement of more than one person in decision-making process slows down it. Ideally, the companies decide based on what is urgently needed. Slow to react in response to environmental changes. Learn how your comment data is processed. Further, because a manager/subordinate is required to comply with orders of a number of specialists, he is confused which specialist to listen to first. Persons connected with different fields try to create their groups and then rivalry starts among these groups. The workers have the advantage of getting instructions from specialists. A Functional organizational structure has several advantages and disadvantages when it comes to managing projects: Advantages. Content Guidelines 2. This reduces the conflicts or contradictions of reporting to both project and functional manager. The work is performed by those who have the specialist knowledge of that work. This makes possible the fullest use of energy in the organization. The emergence of many persons of equal status encourages group rivalries among executives. This monotony causes loss of enthusiasm. Content Filtrations 6. There is a very low level of communication between the two departments, and it results in When nearly similar skilled people are working together, conflicts may arise when one employee is promoted whereas others are not. Because of people’s expertise, the workers with specialized skills can perform tasks quickly, efficiently and with more confidence, while reducing of work-related mistakes. Advantages of Functional Organization • Staff is managed by a person with. This is so important for large organizations that have many functional levels within company as employers will be able to perform their duties which boost the production. Cooperation and communication between departments and units may be poor. The first advantage of functional organization is that it makes the management of specialists easier. This boosts the morale of employees and also enthuses a sense of co-operation among them. Every group tries to dominate the other. Easy to control the organization by the top Due to the nature of the functional organization, it is a simple organizational structure that concentrates authority on the top of the company, and has the advantage of making it easy to control the organization. Planning and execution are also separated. There will be lack of understanding across departments. Management Square Ltd : Flat 40 Nant court, Granville Rd, London NW2 2LB, UK. This creates conflicts among specialists and co-ordination becomes a problem. Every superior considers his work important and wants the workers to give top priority to his assignment. The workers have the advantage of getting instructions from specialists. These persons being specialists, they demand much higher emoluments. Discipline tends to break down not only among workers but also among lower level supervisors. However, the business strategies and the level of bureaucracy make it difficult to respond to changes immediately. This can result in mismanagement and discord. This Video Give the Basic Logic & basic Concept of Functional Organization & its Advantages & Disadvantages ? Much time is taken in consulting different specialists prior to decision-making. The line officer is supposed to be a jack of all trades and is burdened with all types of works. 3. Management Square is a PMI R.E.P. Functional organization allows changes in organization without disturbing the whole work. In choosing a company's organizational structure, management is searching for the one that will bring the company's moving parts together into a well-coordinated, efficient and effective unit. Another disadvantage of functional organization structure is that these functional groups may not be able to communicate more often which decreases flexibility and innovation. When a company uses this type of structure, it groups its people according to their knowledge and skills which help them become specialists on that field. There will be a joint control and supervision in the organization. Specialization: ADVERTISEMENTS: This type of organisation has the benefit of having specialists in each area. In a functional organization structure, the reporting relationships are grouped based on the specialty or functional area. Decision making becomes slower and more bureaucratic. The democratic approach motivates workers to go deep into their work and make suggestions for work improvement. The use of specialists helps in controlling the waste of materials, money and time. Functional organization has the following advantages: This type of organization has the benefit of having specialists in each area. Conflicts may ariseif the performance appraisal system is not properly managed. A functional organization is the most common type of organizational structure. TOS 7. De-emphasis of overall company objectives. In a government, for example, education department may want to reward … This will keep them aiming for advancement and development. Also asked, what are the advantages and disadvantages of organization? Since this type of structure has many departments, it could also have several reporting structures as well. Functional Organization: The Advantages And The Disadvantages, PRINCE2® Foundation and Practitioner (180 Days), We use cookies to ensure that we give you the best experience on our website. After a while, the employees may start feeling monotony or boredom. Do you need a custom written, or plagiarism free solution? Management Square France :3 Avenue de Touraine, 78310 Maurepas, France. Employees do not report to multiple managers. Disadvantages of Functional Organisation: Following are the disadvantages of functional organization: i. It simply states who works for who. The clear nature of the career path within the functional unit makes it possible for employees to be highly motivated to advance their careers as they move up within the hierarchy. Disadvantage of functional organizations will lead to poor communication and coordination across functional units. 2. A functional design may be effective when an organization has a narrow product line, competes in a stable environment, pursues a low-cost or focused business strategy, and does not have to respond to the pressures of serving difficult types of customers. The growth of the unit is adversely affected in a vicious atmosphere. 1. Project Organizations (advantages and disadvantages) • Advantages to the projectized structure include the project manager's opportunity. The basis of this functional organization | Difference, functional areas may become distracted by their goals. 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