Gujarat BoardEnglish MediumSTD 12 CommerceOCMORGANIZING3 Marks
Question
What is a functional organization? Explain briefly. Why did the need arise to set-up functional organization structure?
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Answer
Functional $($Work-based$)$ 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.
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