Business Studies

Six Mark Question:
What is meant by 'Functional Structure' of an organisation? State any five advantages of this form of organisational structure. 


SOLUTION
This is the simplest & the most prevalent form of organizational structure. Functional organisational structure refers to the structure in which different departments are created on the basis of major functions performed in the organisation.
Advantages of functional structure are as follows:
1. Specialisation: Under functional organisation, an employee is required to perform the same job within a department regularly. Thus, this improves the performance of the employees and leads to specialisation in the organisation.
2. Coordination: Since the workers perform similar jobs, it becomes very easy to control and coordinates their activities.
3. Increasing Managerial Efficiency: Functional structure helps in increasing managerial and operational efficiency and thus leads to increase in profits.
4. Economical: It helps in avoiding duplication of work leading thereby to economies of scale and minimum cost.
5. Effective Training: Providing training to employees is very easy since focus is only on a limited range of skills.
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Subjective Medium Published on 18th 09, 2020
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