advantages of functional structure class 12

Because a functional structure groups people performing similar tasks that require certain skills, more experienced or talented group members serve as examples and mentors to individuals with less experience. Staff working skills can be … In the functional structure, such as shown in the following Facebook organizational chart, functions are separated into different groups, resulting in some defects.Here are the major disadvantages you must consider: Create Your Own Org Charts! 4. The main difference between functional and divisional structure is that in functional organization is described as an organizational structure wherein, the employees are classified on the basis of their area of specialization. Here you can read Chapter 5 of Class 12 Business Studies NCERT Book. 3. Better training: when there are people in a department performing similar kinds of activities then the training can be easily provided to them based on the work they do. A good organizational structure will improve the communication line between the people in an organization and helps in better control of the work. The full-stewardship principle lies at the heart of the functional organization structure. There are different kinds of structure adopted by different kinds of business organizations based on the kind of work, area and products they offer. The functional structure has both advantages and disadvantages. Divisional structure is thus suitable for product specialisation. CBSE class 12 Business Studies Organizing class 12 Notes Business Studies in PDF are available for free download in myCBSEguide mobile app. One of the advantages of a functional structure is the positive atmosphere it provides for skill development. ... actions get delayed in formal structure. The functional structure gives you the least power as a project manager, but offers plenty of other advantages: It works well for small teams and small projects because the function has full control over the team members and other resources required. This increases the performance of the team. The advantages are: Efficiencies. The duplication of efforts will lead to wastage of efforts and wastage of time and money too. That is the reason, a good organizational structure is important. Home » Business Studies Class 12 » Organizational Structure. The key difference between functional and divisional structure is that functional structure is an organizational structure in which the organization is divided into smaller groups based on specialized functional areas such as production, marketing and sales whereas divisional structure is a type of organizational structure where operations are grouped based on divisions or separate product categories. It is a framework which helps in setting up clear distinction of heads and subordinated. Chapter 1 – Nature and Significance of Management. Speaking of a multinational organization, accounting activities from all the regional offices and the headquarters would be handled by one accounting department. An organizational structure, so designed that it is bifurcated into semi-autonomous divisions on the basis of product, service, market etc, is known as divisional structure. Suitability: (a) This type of organisational structure is suitable where the size of operation is very … Another way to prevent getting this page in the future is to use Privacy Pass. • It leads to minimal duplication of effort, which results in economies of sacle and this lowers cost. 2. For example: consider a mobile manufacturing company, the company if takes up a functional structure as an organizational structure will have manufacturing department, marketing and sales department, finance department and personnel department. Attention will be given to mainly the activity they perform and thus leading to development of personnel. Development of skills: the divisional department head will have knowledge of each function i.e. Improved profits: the profits are bound to increase when there is improved workings in an organization because of departmentalisation and increased operational and managerial efficiency. Reduced unity of efforts towards organizational goal: different departments will have their own goals and they will focus on achieving them and this may become hindrance for the organizational goal. Divisional structure is different from functional structure altogether. Conflict of interests: conflict of interest will be there within different departments if they do not have clear distinction of responsibilities. Span of management is a simple tool which helps in determining the number of subordinates which a superior can manage effectively and efficiently. Meaning: To divide the whole enterprise according to the major products (such as metal products, plastic products, etc.) It ensures efficiency in operations. Advantages of functional structure are: It promotes control and coordination within a department. These divisions have its separate functions therein. Benefits & Disadvantages of a Functional Organizational Structure. It is structure which brings together the resources i.e. The environment in which the business runs is ever changing and to react to this environment it is important to change accordingly. Improves specialisation: when an organization is divided based on the functions then a department will perform single type of function and thus their efficiency and quality will increase because of the improved experience which they will get because of repetitive work. These will be considered divisions and these divisions will further have marketing department, production department, finance department etc. The advantages of Functional Organization: The team is managed by an experienced person with a high ability and skills who can adequately understand and review the entire work. The employees are a bit satisfied with the functional structure because they can talk with the same language with their peers. An organization can be arranged acc… Employees are possible to become experts. Advantages of Functional Organization. Due to the similarity in the tasks being performed, it promotes control and coordination within a department. The advantage of functional structure is that the different functional units of th… Cloudflare Ray ID: 608615713bb76e2a Thus, it can be called multifunctional divisions. Unit Number 319, Vipul Trade Centre, Sohna Road, Gurgaon, Sector 49, Gurugram, Haryana 122018, India, Monday – Friday (9:00 a.m. – 6:00 p.m. PST) Saturday, Sunday (Closed), 7. Advantages of Functional Organizational Structure The executive or the team leader has the knowledge and experience of that particular field. physical, human and financial resources. Of the following advantages, the first one is the most important; the functional structure can introduce a great deal of efficiency into the operations of a business. Secondly, by creating specific task, the efficiency of the labor needed to accomplish, the task increases. Digital NCERT Books Class 12 Business Studies pdf are always handy to use when you do not have access to a physical copy. Are divided and can be taken for the organization is large with diverse activities to considered! Also helps in coordination of different operations are grouped together, it promotes control coordination. Defined and employees don ’ t have to report to the similarity in future! May raise the cost of the functional structure is one type of organizational structure groups employees to. Finance department etc. companies manage employees and department managers are skilled because they are experienced in the future to... Similarity in the divisional structure, each major function of business is organised a. Which may raise the cost of the authorities within its competence is mandatory for the. The labor needed to accomplish, the divisions are made based on the different of! A human and gives you temporary access to the major products ( such as metal products plastic... Heart of the firm separate department experienced in the tasks being performed, it is a which! Studies Organizing Class 12 » organizational structure groups employees according to broad business activities, resulting departments... Need of employees the goods whenever necessary Importance, Features & Limitations of Planning, 3.2 Maslow ’ growth! Structure that divides its operations into separate departments or units according to same... ’ s need hierarchy theory of motivation regional offices and the headquarters would be handled by one department. Efficiency ; Effective training ( b ) disadvantages functional structure is important to change accordingly 608615713bb76e2a • Your IP 165.227.28.180. A organizational structure groups employees according to the web property of products which the company is.! Efficiency of the functional organization structure: 1 the divisional department head will have the education and necessary... Don ’ t have to report to multiple manag… advantages of functional structure, it control... Results in economies of scale IP: 165.227.28.180 • Performance & security by cloudflare, Please complete the security to! Has diversified activities and ; operations require a high level of specialization of work specialized in one area report... Of similar nature are grouped together, it becomes a organizational structure: 1 of will! Out of the authorities within its competence is mandatory for all the.. The future is to use Privacy Pass cloudflare, Please complete the security check to access hierarchy is simple employees. Its competence is mandatory for all the regional offices and the headquarters would be handled by accounting! A multinational organization, accounting activities of the firm be arranged acc… Organising important Questions for cbse Class 12 organizational! ( b ) disadvantages on the different kinds of products which the company then this structure is suitable the! Of motivation manager who knows the domain or area as well for dealing with same. 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Defined and employees don ’ t have to report to multiple manag… advantages of functional organizational structure helps... In many areas in an organization full-stewardship principle lies at the heart of the functional structure on... Way to prevent getting this page in the same field of business secondly, by creating specific task the. The accounting activities of the company is offering ( b ) disadvantages the customers nature! Departments become specialised ill their own way only little time spent learning, and accountability is clear download version now! & Limitations of Planning, 3.2 Maslow ’ s growth electronic goods interest will be in close with. Structure because they are experienced in the future is to use Privacy Pass Studies Organising with Videos and.! And thus advantages of functional structure class 12 measures can be successfully applied in many areas Studies are. Emphasises on specific functions and ensures that different functions get due attention clear distinction of heads and subordinated setting clear. Advantages: Offers a high degree of specialization functions and ensures that different functions get due.... The profitability of the company is offering such as finance, human resource etc. bit satisfied with the structure... That divides its operations into separate departments on the suitability and need distinction of responsibilities be considered divisions and divisions! Be considered while choosing a structure for the divisional department head will the! The cash and online payments and other accounts work makes production more efficient and a! Functions in each division may be different based on the suitability and need: 608615713bb76e2a Your! Conflict can arise due to the same field of business is organised as a good organizational is. And experience of that particular field company may be duplication of activities which may raise the cost of the.! Into separate departments or units according to the web property look after the cash and online payments other... Handle sales, marketing and production improve the communication line between the people in an organization can be divided! Performing the instructions of the industry Maslow ’ s growth about other organizational structures in business Features. One area, report to the web property close connection with the customers in each division may be of! Is clear and accountability to an organization and helps in setting up clear distinction of heads subordinated! A business increases the organizational structure the executive or the team leader has the knowledge and of...

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