Functional organization is a type of project management structure where employees are organized based on their areas of expertise, and they work within their respective departments. Here are some advantages and disadvantages of a functional organization:
Advantages:
- Expertise: Employees have specialized skills and expertise in their respective fields, which enables them to provide high-quality work.
- Efficient resource allocation: Resources are allocated efficiently since employees are already grouped by department and can easily be assigned to work on different projects.
- Clear career paths: Employees have clear career paths and can easily advance within their respective departments.
- Better communication: Communication within departments is often better since employees work closely with others in their department on a daily basis.
- Reduced duplication: Resources and skills are not duplicated since each department is responsible for specific tasks.
Disadvantages:
- Limited flexibility: The structure can be inflexible and slow to adapt to changing requirements or priorities.
- Lack of collaboration: Communication and collaboration between departments may be limited, which can lead to a lack of cooperation and coordination.
- Silo mentality: Departments may become silos and focus solely on their own objectives, rather than the objectives of the project as a whole.
- Limited accountability: There may be limited accountability since project managers have limited authority over resources, and functional managers may not be held accountable for project outcomes.
- Duplication of resources: Resources may be duplicated if multiple projects require the same skills or expertise, leading to unnecessary costs.
Overall, a functional organization structure can work well for projects that require specialized expertise and have a clear scope of work. However, it may not be suitable for projects that require a high degree of collaboration and flexibility or where a project manager needs to have greater control over resources.
CEO/Top Management
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Finance Operations Human Resources
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Accounting Production Employee Relations
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Budgeting Quality Control Compensation & Benefits