What Are The Advantages And Disadvantages Of Functional, Matrix And Divisional Organisational Structures?

The main advantage of a functionally-structured organisation is that the workforce will be divided into specialised groups and employees will have no difficulties in understanding what is expected of them. Another benefit is that all duties and responsibilities are clearly defined so that there will be no unnecessary replication of work.

A disadvantage of this system is that departments can become limited to their own position in the company, and so become short-sighted rather than proactive. This potentially leads to a jumble of work styles and a lack of communication.

A functional organisation is similar in that all departments are semi-autonomous and operate as separate businesses within the company. For example, a haulage business may have depots in different areas of the country, and each will be responsible for every aspect of their own operation.

An advantage of this method is that it facilitates expansion with little restructuring; though a disadvantage is that many tasks may be duplicated unnecessarily.
The main advantage of a matrix structure is that it allows for quick responses to change over a number of departments or situations, enabling proactive and constructive development. This is because of the closer cooperation and communication between departments as they all work towards a common goal. In fact, it is the standard of communication that is the crux of a successful matrix operation, as all information is shared equally so decisions can be made for the benefit of the company.

The drawbacks to this system are that it is far more expensive to run because of the complex communication systems that have to be put into place. Some employees also feel disoriented because of this ethos of open communication; there does not seem to be any leadership structure, and this can be disconcerting to some. This can lead to dissatisfaction and a higher-than-usual staff turnover.

Disadvantages of the Functional Structure
The functional structure also has inherent disadvantages. Because functions are separate from one another, employees may have little understanding of and concern for the specialty areas outside their own functional area.

The narrowness can lead to barriers in communication, cooperation and coordination. Departments may develop their own focus rather than a company focus.

Also, because a functional structure has rigid and separate chains of command, response time to changes in the environment may be slow. Managers in a functional structure also become focused on their functional area, both long and short range.

Problems are seen from one perspective, and individuals become isolated. In addition, this narrowness carries over to long-range development. The specialization does not give managers a broad perspective on the company or other functional areas. This lack of a broad general perspective minimizes the training for future chief executives.

Advantages of the Functional Structure
Putting specialists together results in economies of scale and minimizes duplication of personnel and equipment. Employees tend to feel comfortable in a functional structure because it gives them the opportunity to talk the same language with their peers.

Because the structure acknowledges occupational specialization, it also simplifies training. Organizationally, the functional structure offers a way to centralize decision making and provide unified direction from the top.

Within each department, communication and coordination are excellent. Finally, the functional structure increases the quality of technical problem solving because it gives workers quick access to those with technical expertise.

In functional structure, the managers have the advantage of supervising similar tasks related to functions such as marketing, manufacturing, R&D etc. Overall supervision is high and coordination can be easily achieved. Since employees performing similar tasks are grouped together therefore overall learning from each other’s skills is high. However the disadvantage is the lesser interaction between the other departments and people belonging to other departments. It is difficult to motivate employees under functional structure because of similar nature of tasks. In matrix structure, an employee works as a team member and reports to two bosses. The advantage include flexibility of tasks, greater learning and disadvantage include chaotic situation when two bosses present opposing points of view. In matrix structure, high coordination is required between the employee and employer. The advantages of divisional structure include flexibility in terms of usage of product structure, geographical structure and market structure depending upon the need of the organization. The disadvantage includes higher costs associated with maintenance of such structures.

Organizational management is very nice to be part of as it makes me feel wanted and useful.