By functional organization one understands an arrangement of the units of an organization after performing (tasks) on the second hierarchy level underneath management. The line takes place thereby after the a line system. For example many small and medium-sized enterprises are partitioned into the ranges research & development, production, marketing & selling and administration. This form of the primary organization represents the oldest organization form in the history of the development. With increasing growth of the organization alternative forms become relevant like the section organization or the matrix organization. In the configuration of Henry Mintzberg corresponds the functional organization to the machine bureaucracy or with very small enterprises of the single structure.

{| border=1

! Advantages! Disadvantages | - | 

• Specialization
• Cost degression (scale effects)
• Clear areas of responsibility, giving up and authority
• Synergies
• Prevention of redundancies

|

• Made more difficult co-operation between the departments/functional areas
• Predominance of the Spezialistentums
• missing understanding for other functional areas/range egoism (ex.: Conflict marketing and production, department thinking)
• Low product and market orientation
• unclear result responsibility
• Restriction of innovation potential

|}

The functional organization is in small and medium-sized enterprises far spread, there it for organizations in a stable surrounding field with a visible, homogeneous product program is suitable.

Literature

• Brown, G., Beckert, J.: Functional organization, in: Frese, E. (Hrsg.): Hand dictionary of the organization, 3. Aufl., Stuttgart 1992, frame 640-652
• Train-to-live, M.: Organization, Munich 2002 ISBN 3800628252, P. 237-242

Articles in category "Functional organization"

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