Question
Explain Functional Organisation with its formation.
✓
Answer
Functional $($Work-based$)$ Organization
The core of functional organization lies in giving special importance to work distribution on the basis of specialization.
Functional Organization
- Linear organization gives more importance to department than work. This is the greatest limitation of this kind of structure.
- Keeping this limitation in mind, the ‘work based’ or say ‘function based’ organization came into existence.
- An organization with a functional structure is divided based on functional areas, such as IT, finance, or marketing.
- In this structure, the experts with specialized knowledge are given special responsibilities for areas of their expertise. This type of structure is called ‘ functional organization. For example, Human Resource Manager will look after the recruitment, transfer, promotions, etc.
- Thus, in functional organization, the distribution of work is not done according to the departmental but according to the nature of work.
The core of functional organization lies in giving special importance to work distribution on the basis of specialization.
- Specialized experts are appointed for each kind of work. These experts do not serve only as advisors but they are also administrative heads of their work areas. They are fully responsible for the task assigned to them. For example, the purchase officer is fully responsible for all type of purchase related work.
- The Chief Executive Officer is at the top and holds the supreme powers of the functional organization.
Functional Organization
- As demonstrated in the chart, the unit can be divided into two $($or more$)$ parts. Each unit has its assigned list of activities and works.
- The units then assign the tasks and works to different officers. For example, the factory unit $($or department$)$ will assign the work to Quality Control Officer, Chief Maintenance Engineer and so on.
- Each officer then gives orders to the employees under him to perform the task.
- In functional organization, not a single work remains unassigned and at the same time not a single work is assigned twice.
- This structure is more favourable for units where there are a variety of works to be done. For example, IT Industry, Telecom industry, etc.
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