Question

Explain the demerits of functional structure.

Answer 1

1. Experts in various departments might not be able to see the company from a broad perspective. The production department could become overly focused on creating a high-quality product, for instance, even though it might not sell for a high price. As a result, achieving the organization's goals becomes challenging.
2. It becomes challenging to assign blame for each issue to a specific department. When sales are down, for instance, it can be challenging to identify which department—the production or marketing department—is to blame for the poor quality of the product.
3. The experience needed for senior management roles is not acquired by functional heads. Inflexibility may result from specialised knowledge and a limited viewpoint.
4. Departments may grow excessively big as the company expands, which would impede decision-making. Interdepartmental coordination becomes challenging.
5. Conflicts and rivalry across departments may result from managers' attempts to establish their own functional empires.