Merits and Demerits of Functional Organization

Functional Organizaion merits and demerits(Image: Functional Organization merits & Demerits)

Merits of functional organization:

The following are the merits of functional organization.

1. Benefit of Specialization: This system provides ample opportunities for minute specialization to its maximum extent.

2. Expertise Knowledge: This system can be entrusted with higher efficiency as knowledge of the experts in the field are involved extensively used. Workers are assisted by experts’ instructions.

3. Division of Work: The whole work process is segregated into functions, and the specialists in the field take care of it. Hence, there is no work burden to executives. The executives perform only a few functions. Mental and manual labors are also separated and so both jobs can be performed with higher degree of efficiency in an organization.

4. Scope for Training: This system also provides opportunity for appropriate training to inspectors and supervisors. This aspect automatically brings flexibility into the organization.

5. Scope for Expansion: Expansion of the enterprise without any dislocation or loss of efficiency is possible.

6. Mass Production: Since specialization is the back bone of the system, the large scale production can be undertaken with minimum costs.

Demerits of Functional Organization:

The functional system is not an unmixed blessing. This system, of course, works very well under a dynamic leadership. Without such leadership qualities it is impossible to attain the same degree of success, due to the following disadvantages:

1. Absence of Unity of Command: The workers have to obey the instructions of many foremen. No individual can work best under two masters. Then how can one serve under many masters. Hence, there is no unity of command and the resultants are conflicts and chaos.

2. Lack of Co-ordination: Without unity of command, co-ordination can not be achieved to the peak level. This system has the effect of destroying co-ordination in the organization, particularly at lower levels..

3. Difficulty in Fixing Responsibility: Since there is no unity of command, fixing of responsibility is a practical impossibility. Thus, this system upsets the very basis of organization which aims at fixing of responsibility.

4. Chances for Indiscipline: Maintaining of discipline is a difficult task because each worker is subject to work under eight bosses. Indiscipline at all levels has the effect of lowering the employees morale.

5. High Clerical Costs: This system also increases the amount of clerical work which ultimately results in the increase in the amount of overhead expenses. Hence, it is uneconomical.

6. Absence of Initiative: Workers, being always spoon fed with technical knowledge, shall lose initiative and become a group of mere automation. The supervisors shall also lose their drive and initiative. Hence, even the routine work shall become complicated.

Leave a Reply

Recent Posts




Comments


Related pages


payback definitionwhat is meant by sundry creditorstransfer pricing advantages disadvantagesdisadvantages of merit payhuman resource management advantages and disadvantagesdifference between merger and consolidationadvantage and disadvantage of mass mediaaims of wtoretained profits advantages and disadvantagesimpossibility of performance of contractmeaning of bonus sharesrecording petty cash transactionsnon probability sampling designsadvantages and disadvantages of mixed economic systemgatt and wtoimportances of budgetingservices provided by sbi bankroles of financial intermediariesconvertible and non convertible preference sharesdebtors collection period ratioadvantages and disadvantages of communism economyvarious methods of costingadvantages and disadvantages of franchisorcheques definitionmeaning of drawer and drawee of chequeinternet retailing definitionrate of inventory turnover formulamain objective of wtoregional economic groupingsmeaning bill of ladingdistinguish between product layout and process layoutdefine bidgetadvantages and disadvantages of electronic commerceactivity based costing advantages and disadvantages examplesrsq meaningdefinition of merits and demeritsbudgetary and non budgetary control techniquesexplain ratificationdefinition franchiseestock turnover ratio analysis interpretationmaterial usage variance formulaundisclosed principal definitionultra vires doctrinelimitations of marginal costinghow do you calculate quick ratioantedated chequeindian contract act bare actdifference between valid void and voidable contractsultra vires actessential element of valid contractdisadvantages of a sole tradermonetary policy rbidisadvantages of oligopolywhat is gatt and wtowhat is alphabetic filingadvantages and disadvantages of internet marketingwhat are the different types of negotiable instrumentsadvantages and disadvantages of standardisationmeaning of redemption of debenturessecuritization definitionadvantages and disadvantages of random sampling methodrelayout meaningnpv approachsampling techniques probability and nonprobabilitybudget and budgetary control notesar turnover ratio formulalabor efficiency formulahorizontal takeoverdisadvantages of merit paynumerical filing rulescentralisation and decentralisation of authorityprofitable indexteeming and lading in auditingaudit tickmarksdefine impersonablemeaning of target costingliens meaning in hinditeeming and lading in auditingadvantages and disadvantages of open plan office