Organizational structure is an important part of any organization because it helps you to understand who reports to whom. Functional organizational structure is one of the traditional structures. It includes different common functions of the organization including manufacturing, engineering, marketing, human resources, and secretarial. Top management usually controls Functional organizational structure based on the units and departments of the organization. Different divisional and product structures are distinguished in units according to the team leaders and geographical region. Functional organizational structure is based on the concept of high specialization and high control to increase the efficiency of your organization.
History of Functional Organization Structure
Functional organization structure has ancestry from the early 20th century after the emergence of the industrial age to increase the efficiency of management as efficiency is the main concern of each organization. At that time, organizations were designed with few managers at the top to lead several people at the bottom for the performance of tasks in an organized way. Functional organization structure defines everything in detail and features top-to-down authority control. Control was maintained by establishing standard procedures.
Leadership Requirements under Functional Organization Structure
This structure is based on the top to down authority control therefore leaders require in-depth knowledge and experience in their area of specialization. This type of structure is used in those organizations where unit leaders have an outstanding command of their given field. Leaders of each unit are required to be mentors of young staff members. Competency in their field and proper management skills are required for the success of a functional organizational structure.
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Benefits of Functional Organizational Structure
Functional organization structure provides clear lines of command and specialized individuals in each department play an important role in the growth and expansion of the organization. This type of infrastructure promotes career advancements by clearly defining career paths, aptitude, talent, and knowledge. It can make your work more enjoyable as you are working with a group of people with different knowledge levels.
Weaknesses of Functional Organization Structure
Each unit of the organization focuses on its area of specialty therefore there can be a lack of a broad view of the company. This structure features poor communication across different groups of people and slow response can have negative effects on the environment. The decision-making authority of different units can be weakened as compared to the top level of management.
Effectiveness of Functional Organization Structure
Functional organization structure works best in a stable organization because, in the presence of a functional organization, you cannot make rapid changes in the strategy. It is best for smaller or medium organizations that deal with a few types of products and services.
