What is an Organization?
The organization is the collection of people who work together, to achieve a common objective or a goal. In other words, Organisation is a place where people gather together, working on a different set of duties and responsibilities to fulfill the goals of the organization.
Functional Organization
A functional organization structure differentiates the employees by their skill, specialty, etc. It completely depends on a ranking system that consists of several departments under the guidance of expert leadership. Most businesses operate under the functional structure because it combines workers who have similar knowledge and skills, when used in a team environment, it will be helpful for the company to achieve their desired goals.
Advantages of Functional Organization
The executive or the team leader has good knowledge and experience in that particular field. For example, the person heading the marketing department will have the knowledge and skill necessary to carry the process with full responsibility and successfully run his team.
As the employees are experts in that particular field, the work becomes more efficient and precise. Reduces the rate of mistakes as this could motivate the employees of the company.
Since every member comes from a similar background it allows them to share their thoughts and come up with better solutions. As sharing of knowledge is always beneficial.
The employees also can have a clear idea of the hierarchy and need not have to report or answer to several managers.
Also, the employees can feel the work security as their work and efforts are not going unnoticed. This can help them to perform better.
Disadvantages of Functional Organization
The work can become one-dimensional. After some time, the employees may start to feel repetitive or bored. The lack of new challenges will make them unenthusiastic.
In this type of structure, the manager must keep an eye on the appraisal system. If the right approach is not made then there can be high chances of conflicts between the employees regarding their promotions or appraisals.
Also, this type of organization needs a high specialization degree which can be difficult to establish
If there is a change of personnel in the team, it can literally affect the whole system and its balance. Also, it is a rigid structure, where there are not a lot of scopes for adaptation.
In a Functional Organizational Structure, the employees can never gain any knowledge or skills out of their own department. This can be a big cause for inter-departmental communication.
FAQs on Functional Organization
1. What are the Merits of Functional Organization?
The works in the functional organization are completely specialized and every worker gets expert guidance from a number of specialists.
Functions can be performed more effectively as each and every manager is exclusively responsible for only one function rather than multiple functions.
Supervision and control of the organization are likely to be better, as each supervisor is an expert in their working area.
The Organization follows a democratic control, where one-man control is replaced by joint control.
The growth and expansion of the organization are not bound to the capabilities of a few line managers.
2. What are the Demerits of Functional Organization?
It violates the principle of unity of command as one person gets orders from a number of specialists. It can lead to conflict and poor understanding.
The responsibility is split as it is not possible to fix a specific responsibility to individuals based on the results.
Due to a violation of the unity of command, there can be a lack of coordination among individuals.
Decision-making of the Organization can be delayed as it involves several specialists. To make a decision as a whole every functional manager should be consulted and it cannot be taken quickly.
It is very complicated and expensive.
3. What are the Features of the Functional Organization?
The following are some of the features of the functional organization
The whole organizational activities are divided into small specific functions such as operations, finance, marketing, personal relations, etc.
It is a complex form of administrative organization when compared to the other two types.
There are three authorities as line, staff, and function.
Each functional area is managed and controlled by functional specialists and he/she has the full authority to make decisions, whenever the function is performed throughout the organization.
The principle of unity of command is not applicable to such an organization as it is in the line organization.
4. What is an Organization? What are its Types?
The organization is the process of collection of people, who perform various sets of tasks to attain defined goals. It is generally defined as a social system that involves all formal human relationships. Organizational types vary from one enterprise to another and it completely depends on them. The organization are classified into two broad types, they are:
Formal Organization
Informal Organization
The Formal organization is classified into:
Line Organization
Line and Staff Organization
Functional Organization
Project Organization
Matrix Organization
5. What is a Line Organization?
Line organization is the simplest and oldest type of organization structure. It is also referred to as Scalar or military or departmental type of organization. In this type of organizational structure, the authority is very well defined and the structure flows vertically from the top to the bottom of the hierarchy level such as from the top managerial level to subordinates at the bottom and continues till the end of the hierarchy. This type of top-to-the-bottom approach of organization structure is called the line organization.
6. What do you mean by functional structure?
Functional structure is a kind of organizational structure used in businesses. This includes a grouping of the employees of the company based on their skill set and specialities. The employees are grouped under different departments based on their ranking. This is done under the supervision of the designated seniors or leaders.
7. What are the types of organizational structures?
There are 4 types of organizational structures:
Divisional
Matrix
Flat
Functional
