ORGANIZING — OCM STD 12 Commerce — Question

Introduction : the work based organization came into coexistence due to the limitation of linear organization. The organization specially stresses work distribution and specialization.

• Meaning of Functional Organization :

• A structure is formed in which, special responsibilities in the particular unit is known as functional organization. e.g. Purchase officer is fully responsible for all kind of purchase related work. Similarly Personnel officer will look after all personnel matter like Recruitment, Transfer, Promotion, etc.

• Formation of Functional Organization :

• Formation of organization is done according to functions/work.
• The work distribution is done according to the nature of work.
• An expert is appointed for each kind of work.
• The experts are advisors as well as administrative heads who are fully responsible for the task.

• Diagram of Functional Organization :

• Explanation of the Diagram :

• In functional organization, the greatest power is with the main Administrative head.
• The unit can be divided into two parts, viz. Administrative and Factory. Each part has its own list of activities and work as well as assigned officer.
• Each officer can give orders to the employees.
• In this organization not a single work remains unassigned and not a single work is assigned twice.

• Suitable for:- This types of organization is suitable for the unit where variety of work can be seen.
• Conclusion : Functional organization is formed in which special knowledge based experts are given special responsibilities. So the benefit of their expertise is obtained, but at the same time unity of command is not maintained and lack of discipline can be seen.