When nearly similar skilled people are working together, conflicts may arise when one employee is promoted whereas others are not. For example, to establish its image, the production department may produce quality product ignoring the fact that market trend favors accepting medium quality product. Ignorance of Organisational Objectives: Each departmental head works according to his sweet will. Image Courtesy : upload.wikimedia.org/wikipedia/commons/1/18/World_(July_2013).jpg. This video outlines the 6 key reasons why organizations introduce a matrix and the importance of communicating these reasons clearly. There will be lack of understanding across departments. There may be a lack of understanding as to how significant that specific are to the company. Conflict amongst Foremen – Under this type, foreman of equal rank will be many in number and this may lead to conflict among them. Disadvantages of a functional organizational structure Lack of attention. As principle of unity of command is not followed, there are conflicts among staff experts and line executives leading to physical and financial loss. This organisational structure relates to an organisation which has outgrown the entrepreneurial stage. They focus more on their own goals and neglect the overall company objectives. Hence, overall organisational objectives suffer. 3. Functional Organizational Structure In a functional organization structure, the project manager and all the resources work in the same company division, such as the sales and marketing department. Plagiarism Prevention 4. This system is a hurdle in the way of the complete development of the employees. Job descriptions are detailed and specialized. Problems may arise among management if department heads are only focused on their department and do not communicate effectively with other departments. This will reduce communication channels. Benefits & Disadvantages of a Functional Organizational Structure. Functional organizational structure, also referred to as centralised structure is one of several reporting structures a company could implement. In the functional structure, such as shown in the following Facebook organizational chart, functions are separated into different groups, resulting in some defects. Disadvantages of Functional Organizational Structure. The functional organizational structure groups employees according to broad business activities, resulting in departments such as finance, marketing and production. Copyright 10. The vertical separation of divisions and teams can lead to the creation of 'organisational silos'- a mindset where one team hesitates to share information or knowledge with other teams within the same organisation. 5. The biggest disadvantage of functional organization is that since various departments are segregated on the basis of functions there is no scope of employees of one department helping or meeting the other department employees and hence in a way there are many companies in the form of departments within the company and each department is … Lack of Fixed Res… It helps the organization to perform work according to the function, thus avoiding any duplication of work. Employees do not report to multiple managers. 3. In this structure, the manager must take care of the appraisal system. Conflict in Authority: ADVERTISEMENTS: The principle of ‘unity of command’ is violated in functional organization. 2. Content Filtrations 6. There is a very low level of communication between the two departments, and it results in po… The workers have to obey the instructions of many foremen. Employees may find it boring to repeat the same task over and over, and become less enthusiastic over time. If promotions are not handled well, an employee may be discouraged if a lower performing peer is promoted over them. A variety of different structures are utilised today. It will lead to poor communication and coordination across functional … After a while, the employees may start feeling monotony or boredom. The work can be quite one dimensional. Every business or organisation is structured differently, depending on its needs and goals. One manager would be … Sabre Corporation Case Study 1281 Words | 6 Pages. Speed of Action: As control is divided among the various specialists, the speed of action is very much hampered. Discipline – Since workers have to work under different bosses, it is difficult to maintain discipline among them. The disadvantages of Functional Organization: * The functional organization may have unhealthy competition working with the other areas. 2. With so much management, bureaucratic structures have strong boundaries. Image Guidelines 5. The advantages of functional organization structure. 2. Slow to react in response to environmental changes. Divisional structure is not a possibility in small organizations. Functional managers oversee entire departments of an organization. 2. (2) Difficulty in Interdepartmental Coordination: All departmental heads may work as per their own wish. This decreases the overall efficiency of the employee. Discipline: Since workers have to work under different bosses, it is difficult to maintain discipline among them. This can cause poor communication and \"silos\" that are too independent from one another. This system, of course, works very well under a dynamic leadership. According to name, functional organisation implies that the organisation ought to be based on various functions. Disadvantages of Functional Organisation: Following are the disadvantages of functional organization: i. Content Guidelines 2. Some of the disadvantages of interrelationships between organizational functions are – 1. Lack of Co-ordination: There are several functional experts in the organisation and this may create the problem of coordination. Functional Organisation F.W. Disclaimer 9. The specialization will lead to a narrow viewpoint and lack of overall perspective. One advantage of this sort of flatter hierarchy is that it is easier for employees to communicate with each other and it facilitates learning. As projects are managed by multiple functional managers, clients may not get the right status of the project. In this article, we are going to review the advantages and disadvantages of each organizational structure: Functional, Projectized, and Matrix. Easy Org Chart Creator – Powerful & Economic Choice for Your Business, Org Chart Template: Essential Ones for Your Work, Org Chart Software: The Ultimate Guide for You, Dropbox Business Org Chart: Check the Magic Figures. Copyright OrgCharting 2004-2016; All Rights Reserved. Grouping jobs by function breeds certain economies. As the company starts growing, the departments also become larger. Org Chart Creator provides the best org charting service. There are powerful reasons to introduce a matrix organization structure – that’s why many of the world’s leading organizations have one. Here are the major disadvantages you must consider: Main Disadvantages of Functional Organization Structure. 5. Chains of command are clear, as are expectations and decision-making power. It is the most widely used structure because it is the simplest and least expensive of the seven alternatives. Some of the advantages of a functional structure include better skill development, a clear chain of command, expedited decision making, qualified supervision and specialized organizational results. Demerits of Functional Organization: The functional system is not an unmixed blessing. It will lead to poor communication and coordination across functional units. Matrix Structure. Before publishing your articles on this site, please read the following pages: 1. 1. Outlined in a grid fashion, the functional managers and project managers are role-specific and are included within the matrix. Advantages & disadvantages of functional structures Advantages . The disadvantages of the functional organization are as follows- 1. Every superior considers his work important and wants the workers to give top priority to his assignment. Departm… Lack of teamwork and reduced flexibility may cause conflicts between departments and units. There must be strategies in place to deal with the potential negatives which like to occur under this structure. 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