Outline the benefits to a business of a functional organisational structure.
- Leaving Cert Business - Question 4 B - 2015
Question 4 B
Outline the benefits to a business of a functional organisational structure.
Worked Solution & Example Answer:Outline the benefits to a business of a functional organisational structure.
- Leaving Cert Business - Question 4 B - 2015
Step 1
Benefit 1: Specialization
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Answer
A functional organisational structure allows employees to specialize in specific tasks, such as marketing, production, or finance. This specialization fosters higher levels of expertise and efficiency as employees perform their tasks repeatedly, leading to quicker and higher-quality outputs.
Step 2
Benefit 2: Clear Chain of Command
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The structure provides a clear chain of command and defined lines of authority. Employees know who to report to, which simplifies the decision-making process and increases accountability within each department.
Step 3
Benefit 3: Effective Communication Channels
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With distinct departmental layers, the structure facilitates clear communication channels between the top and bottom of the organization. This enables smooth upward communication of information and instructions, speeding up decision-making.
Step 4
Benefit 4: Economies of Scale
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Functional structures often result in economies of scale as resources can be utilized more effectively. Departments can share resources efficiently, resulting in cost savings and optimized operations.
Step 5
Benefit 5: Promotional Paths
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A functional organisational structure creates visible promotional pathways within departments. Employees can see clear career progression opportunities, enhancing motivation and encouraging talent retention within the business.
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