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    Business Structure Basics 22

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    Thanu Suthatharan
    A functional organizational structure groups individuals by the specific functions they perform, with common departments like human resources, accounting, and purchasing organized independently. Managers of different functional areas all report up to a single director or vice president. While this structure separates functions by expertise, the challenges arise when the areas become silos focused only on their own responsibilities rather than supporting other departments.

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    Business Structure Basics 22

    Uploaded by

    Thanu Suthatharan
    5 views1 page
    A functional organizational structure groups individuals by the specific functions they perform, with common departments like human resources, accounting, and purchasing organized independently. Managers of different functional areas all report up to a single director or vice president. While this structure separates functions by expertise, the challenges arise when the areas become silos focused only on their own responsibilities rather than supporting other departments.

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    A functional organizational structure groups individuals by the specific functions they perform, with common departments like human resources, accounting, and purchasing organized independently. Managers of different functional areas all report up to a single director or vice president. While this structure separates functions by expertise, the challenges arise when the areas become silos focused only on their own responsibilities rather than supporting other departments.

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    © All Rights Reserved
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    5 views1 page

    Business Structure Basics 22

    Uploaded by

    Thanu Suthatharan
    A functional organizational structure groups individuals by the specific functions they perform, with common departments like human resources, accounting, and purchasing organized independently. Managers of different functional areas all report up to a single director or vice president. While this structure separates functions by expertise, the challenges arise when the areas become silos focused only on their own responsibilities rather than supporting other departments.

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    of 1

    2.

    Functional Organizational Structure

    Functional organizational structures are the most common. A structure of


    this type groups individuals by specific functions performed. Common
    departments such as human resources, accounting and purchasing are
    organized by separating each of these areas and managing them
    independently of the others.

    For example, managers of different functional areas all report up to one


    director or vice president who has responsibility for all of the operational
    areas.

    The advantage of this type of structure is that functions are separated by


    expertise but the challenges comes in when different functional areas turn
    into silos that focus only on their area of responsibility and dont support the
    function of other departments.

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