What are the characteristics of the functional structures?
Companies that produce the same goods consistently and have routine operations use a functional organizational structure because its rigid structure provides predictable stability. Show
An organization can adapt to any structure it requires. If the business mainly handles projects, it will choose a projectized structure. While an organization dealing with operations will stick with a functional structure. Your working style accommodates your organizational structure, defining your role and responsibilities and shaping the work culture. This culture includes the work environment, reporting system, hierarchy, etc. Every organizational structure has a different system. In a projectized organizational structure, team members report to the project manager. Likewise, employees report to a functional manager in a functional organizational structure. In a matrix organizational structure, it varies. I have covered the matrix and projectized structures in other blog posts. For now, let’s focus on the functional organizational structure. Functional Organizational StructureThe PMBOK Guide defines functional organizational structure as “An organizational structure in which staff is grouped by areas of specialization, and the project manager has limited authority to assign work and apply resources.” A functional structure divides the organization into departments based on their functions. Each is headed by a functional manager, and employees are grouped according to their roles. Functional managers typically have experience in the roles they supervise, ensuring that employees are using their skills effectively. A functional structure that maximizes department expertise helps companies achieve their business objectives. Under a functional organizational structure, employees are classified according to their function in an organizational chart. This chart shows the role hierarchy (e.g., president, vice president, finance, sales, customer service, administration, etc.). Each department has a head responsible for it, helping the organization control the consistency and quality of its performance. These department heads are skilled, experienced in the same work, and perform at a high level; accordingly, productivity is exceptional in a functional structure. Functional departments are sometimes referred to as “silos.” This means each department is vertical and disconnected from the others, and communication flows straight up through the department heads to top management. Here, all authority remains with the functional manager. Usually, a project manager has a minimal or even non-existent role in functional organizations. Project managers will need the functional manager’s approval to use resources and may operate as a coordinator or an expediter. The functional organization structure works well in businesses dealing with operations, like manufacturing industries. The strengths of functional organizational structures are specialization and efficiency. Small companies with a limited number of products use this structure. Their employees are highly skilled due to repetitive work, which means they feature high efficiency and superior performance. Since employees are grouped according to their skills and experience, they gain more knowledge and expertise and become specialists, making them highly efficient and productive. They will perform quickly, with less chance of error, and their output will be high quality. The key weakness of functional structure is insufficient cooperation among different departments and management problems. Although each department is efficient and productive, the lack of coordination among functional units or departments slows productivity. They often inadvertently compete with each other, putting their department’s interests above the organization’s. This causes low employee morale, affecting the productivity level, which can fall behind the target. Communication in functional organizations is formal and mostly from top to bottom. The top management makes decisions and informs the lower-level employees. They often change procedures and modify the work environment without taking input from employees on the ground. This negatively affects the morale of the employees and lowers efficiency, ultimately setting back innovation. Advantages of the Functional Organizational StructureThe following are several benefits of the functional organizational structure:
Disadvantages of the Functional Organizational StructureThe following are a few disadvantages of the functional organizational structure:
Examples of Functional Organizational StructureSmall organizations dealing with production can be similar to a functional structure. However, as they grow, they will need elements of a projectized structure. For example:
SummaryThe functional organizational structure helps organizations run their businesses, especially those involved with ongoing operations. Employees feel secure, perform well, and are highly skilled here. Project managers typically do not have any role in a functional organization. They will have a very limited role and no authority if they do exist. In a functional organization, employees’ roles are static, and they report to the functional manager. Does your organization use a functional organizational structure? If yes, please share your experience in the comments section. This is an important topic for the PMP exam. You will see quite a few questions on this topic in your exam. What are the characteristics of a structure?Important characteristics of an organization's structure include span of control, departmentalization, centralization, and decentralization.
What are the basic characteristics of functional Departmentation?In functional departmentalization, an organization is organized into departments based upon the respective functions each performs for the organization. For example, a manufacturing company may create a production department, sales and marketing department, an accounting department, and a human resources department.
What are the characteristics of the functional divisional and matrix structures?Matrix Structure is a combination of functional and divisional structures. This structure allows decentralized decision making, greater autonomy, more inter-departmental interactions, and thus greater productivity and innovation.
What are the 3 characteristics of organizational structures?Division of labor: dividing up the many tasks of the organization into specialized jobs.. Hierarchy of authority: Who manages whom.. Span of control: Who manages whom.. Line vs staff positions.. Decentralization.. |