- With the help of a diagram, explain the meaning of functional structure and discuss some of its advantages.
or
What is meant by functional structure’ of an organisation? State any five advantages of this form of organisation structure?
or
A steel manufacturing company has the following main jobs.
(i) Manufacturing (ii) Finance
(iii) Marketing (iv) Personnel
(v) Research and development
Which type of organisation structure will you choose for this type of company and why? State any five advantages of this organisation structure.
For such a company, I would choose functional structure because the company has grouped the activities or jobs of similar nature into separate departments, such as manufacturing, finance, marketing and so on.
Advantages of functional structure :
(i) It leads to occupational specialisation, since emphasis is placed on specific functions and repeated performance leading to efficient functioning.
{ii) It promotes control and coordination within a department because of similarity in the tasks performed.
{iii) It leads to increased efficiency and profits.
{iv) It leads to minimal duplication of efforts, which results in economies of scale, and this lowers the cost.
{v) It makes training of employees easier as the focus is only on a limited range of skills.
{vi) It ensures that all functions get due attention.