Question

State the Various types of organisational structure. What are its merits and demerits?

Answer 1

Answer:

Explanation:

The organisational structure can be classified under 2 categories which as follows :

1. Functional structure
2. Divisional structure.

• functional structure

When the activities or jobs are grouped keeping in mind the functions or the job then it is called functional structure.

ADVANTAGES:

• Specialisation
• Easy supervision
• Easy co-ordination
• It helps in increasing managerial efficiency
• Effective training

DISADVANTAGES:

• The departments become specialised ill their own way only.
• When departments become too large then the co-ordination decrease.

• When the organisational goals is not achieved then it becomes very difficult to make anyone department accountable.

• Employees get training of one function only i.e., the department to which they belongs so they can not be shifted to other department.

SUITABILITY :

• It is most suitable when the size of the organisation is large, has diversified activities and operations require a high degree of specialisation.

 Divisional Structure:

When the organisation is large in size and is producing more than one type of product then activities related to one product are grouped under one department.

ADVANTAGES :

• Product specialisation

• Fast decision making

• Accountability

• Flexibility

• Expansion and growth

DISADVANTAGES :

• Each department will require all the resources as every division will be working as an independent unit.

• Conflict on allocation of resources.

• Each department focus on their product only and they fail to keep themselves as a part of one common organisation

SUITABILITY :

• Organisation producing multi product.

• Organisation which require product specialisation.

• Growing companies which plan to add more line of products in future.