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CSEET · Business Laws and Management · Management Knowledge for Company Secretaries

Which of the following is an advantage of a functional organisation structure?

A key advantage of a functional structure is specialisation: activities are grouped by function such as production, marketing or finance, so employees develop expertise and the work becomes more efficient. It does not eliminate inter-departmental coordination problems or the need for top managers.

  1. AEach employee reports to only one manager for all matters
  2. BSpecialisation of work within each department leads to efficiencyCorrect
  3. CIt removes all coordination problems between departments
  4. DIt makes the top manager's role unnecessary

Explanation

Grouping jobs by function such as production, marketing and finance builds specialisation and efficiency. It does not remove coordination issues, which are in fact a known drawback. It also does not remove the need for top management.

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