ORGANISATION STRUCTURES AND THEIR ADVANTAGES AND DISADVANTAGES

Organizations are set up in specific ways to accomplish different goals, and the structure of an
organization can help or hinder its progress toward accomplishing these goals. Organizations
large and small can achieve higher sales and other profit by properly matching their needs with
the structure they use to operate. There are six different organization structures: functional,
process-based, geographical, market-based, product-based and matrix (Eric Devaney 2014).
In the world of business, methods of organization can be used to convey an idea, relay
information, assemble a procedure and seal a deal. Methods of organization create order and
direct the thoughts of the audience interacting with the information. Whether it is creating a
report, sorting data, presenting an idea or organizing facts, choosing a method of organization
sets the stage for decision-making. Some of the methods of organization are as follows:
Chronological order (places each piece of information into a sequence of dates or time frames),
Order of importance, Comparison and contrast (identifies the similarities and differences),
Geographical organization, Inductive (orders information by complexity and places facts before
conclusions and recommendations) and Deductive (begins with a recommendation and follows
with information (facts, statistics and examples of success or failure) to support that
recommendation) (Alex burke n.d.).
The following are the six organization structures with their advantages and disadvantages.
Firstly, functional organizational structure, 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.
The advantages of this type of structure are that functions are separated by expertise, needs can
be met more rapidly and more specifically and avoids duplication of work, this helps to increase
the rate of production and improves quality of work. The disadvantages are that communication
is inhibited because employees in different divisions are not working together, its costly because
of its size and scope and customers may also become frustrated by lack of cooperation if they
have to work with more than one department.
Secondly, product-based organizational structure, this type of structure is organized by using a
specific product type. Each product group falls within the reporting structure of an executive and
that person oversees everything related to that particular product line. The advantages of this
type of structure are that it organizes products by category, can help to shorten product
development cycles and it is feasible and adjustable to changes in the business environment. The
disadvantages are that it can be difficult to scale the organization, the organization may end up
with duplicate resources as different divisions strive for autonomy and the structure is not
suitable or applicable to all organizations.
Thirdly, process-based organization structure, are designed around the end-to-end flow of
different processes, such as "Research & Development," "Customer Acquisition," and "Order
Fulfillment." Unlike a strictly functional structure, a process-based structure considers not only
the activities employees perform, but also how those different activities interact with one
another. The advantages are that this structure is ideal for improving speed and efficiency, is
best-suited to rapidly changing business environments, as it is easily adaptable and this allows
the company to respond quickly to customer needs. The disadvantages are that barriers between
the different process groups can lead to problems communicating and handing off work, is
unsuitable for developing general managers and can only be used with certain types of products
and organizations.
Fourthly, geographical organizational structure, for organizations that cover a span of
geographic regions, it sometimes makes sense to organize by region (organization is based on
the geographical location). The advantages are that it supports logistical demands and
differences in geographic customer needs, low operation cost as the company organization is
close to customers and suppliers and there is a good interaction between the company and its
customers. The disadvantages are that it can be easy for decision- making to become
decentralized, there is less interaction between the company subdivisions and its headquarters
(due to the long distance) and there is poor management (stuff) training because its costly.

Fifthly,