Divisional structure is a type of organizational structure where operations are grouped based on divisions or separate product categories. Specialisation; Easy supervision; Easy co-ordination; It helps in increasing managerial efficiency; Effective training (b) Disadvantages. The Disadvantages of Team-Based Organizational Structure. Under this system, individuals with similar jobs and skills are grouped together into productive units with a hierarchical reporting system. 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. Tho departments become specialised ill their own way only. Pages 12 This preview shows page 7 - 9 out of 12 pages. Disadvantages of a Functional Organizational Structure. In this article, we are going to review the advantages and disadvantages of each organizational structure: Functional, Projectized, and Matrix. Functional structure. What is a functional structure? Divisional heads are accountable for profits, as revenues and costs related to different departments can be easily identified and assigned to them. 5. Functional structure. * Logical structures ensure clear flow of control. Lack of Co-ordination: There are several functional experts in the organisation and this may create the problem of coordination. For example, the person heading the IT department will have the education and skill necessary to shoulder this responsibility and successfully run his team. Share yours for free! The key emphasis inP3 is matching structure with strategy. Performing the instructions of the authorities within its competence is mandatory for all the units. 3. Since the employees are grouped by their knowledge and skills, competition may arise between them. Functional advantages and disadvantages. 4. Although extremely useful for many purposes organizational charts are not for everybody. 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. This decreases the overall efficiency of the employee. Virtual B. Get ideas for your own presentations. 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. Advantages of the Functional Organizational Structure. Many are downloadable. Difference between Mixed Economy and Socialism, Advantages and Disadvantages of Bill Discounting, Advantages and Disadvantages of Convertible Bond, Difference between Capital and Money Market, Precautions to take Before Investing in Stock Market. Advantages of divisional structure Product specialization helps in development of various skills in divisional head and prepares him for higher positions. Let's take a look at the advantages and disadvantages of each so you know what you're up against when you join a new structure. Functional organizational structure advantages and disadvantages. This provides a variety of benefits. A reduction in overhead costs and an increase in operating efficiency. The Functional Organization Structure can be successfully applied in many areas. In the long term, employees tend to feel bored and the monotony of the job can be off-putting. 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. 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. Functional structures are usually found in smaller organisations,or within individual divisions in a larger organisation with adivisional structure. One of the advantages of a functional structure is the positive atmosphere it provides for skill development. A Functional organizational structure has several advantages and disadvantages when it comes to managing projects: Advantages. I personally don't think a functional organizational structure is ideal for project managers - better go with a matrix organization. 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 … ADVERTISEMENTS: Organizational Structure: Functional Structure and Divisional Structure ! Advantages And Disadvantages Of A Functional Organizational Structure 757 Words 4 Pages A functional organization structure is a hierarchical type of organization structure wherein people are grouped as per their area of specialization. In order to understand this better let’s look at some of the advantages and disadvantages of functional organization –. There are both advantages and disadvantages of a matrix structure. The advantages of a functional structure range from better skill development to specialized results throughout the organization. Their roles and responsibilities are fixed, facilitating easy accountability for the work. View Functional Organizational Structure Advantages And Disadvantages PPTs online, safely and virus-free! Functional programming is a way of thinking about software construction based on some fundamental, defining principles. 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