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Identify the advantages of the functional structure from the options given below.

  1. (A) It leads to occupational specialisation since emphasis is placed on specific functions. This promotes efficiency in the utilisation of manpower as employees perform similar tasks within a department and are able to improve performance.
  2. (B) It promotes control and coordination within a department because of similarity in the tasks being performed.
  3. (C) It promotes flexibility and initiative because each unit functions as an autonomous sector, which leads to faster decision-making.
  4. (D) It helps in increasing managerial and operational efficiency and this results in increased profit.

Choose the correct answer from the options given below:

Solution

✅ Correct Option: 1

Option 1 -> (A), (B), and (D) are advantages of functional structure - specialization, control within departments, and efficiency gains are key benefits of organizing by function.

Option 2 -> Incorrect because (C) describes divisional structure characteristics, not functional structure, while excluding the valid advantage (D).

Option 3 -> Incorrect because (C) is not an advantage of functional structure - autonomous units and flexibility are features of divisional structures, not functional ones.

Option 4 -> Incorrect because it excludes (A), which is a core advantage of functional structure, and includes (C), which describes divisional structure benefits.


Hence, Option 1: (A), (B) and (D) only -> Functional structure advantages include: (A) occupational specialization leading to efficiency through similar tasks, (B) easier control and coordination within departments due to task similarity, and (D) increased managerial/operational efficiency resulting in higher profits. Statement (C) is incorrect as it describes divisional structure characteristics - functional structures are actually less flexible and do not operate as autonomous units, requiring cross-functional coordination for decisions -> correct

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