This document discusses three main types of organizational structures: functional, divisional, and line and staff. The functional structure groups employees by specialty and reports to functional managers. Divisional structure divides the organization into autonomous divisions based on product, market, or geography. Line and staff separates roles into revenue-generating "line" managers and supporting "staff" functions. The document outlines advantages and disadvantages of each approach.

1. TYPES OF
ORGANIZATION
M.NOMAN ASLAM(15MT19)
METALLURGY AND MATERIALS DEPARTMENT

2. CONTENT
Functional Organization
Divisional Organization
Line and Staff Organization

4. FUNCTIONAL ORGANIZATION
A functional organization structure is a hierarchical
organization structure wherein people are grouped as
per their area of specialization. These people are
supervised by a functional manager with expertise in
the same field.

5. In this kind of organization structure, people are
classified according to the function they perform within
the organization.
Each department will have its own department head
who will be responsible for the performance of his
section. This helps the organization control the quality
and uniformity of performance.
FUNCTIONAL ORGANIZATION

6. These different departments are sometimes referred to
as “silos. This means the system is vertical and
disconnected.
Here all authority (i.e. budget allocation, resource
allocation, decision making, etc.) stays with the
functional manager.
FUNCTIONAL ORGANIZATION

7. CEO
FUNCTIONAL
MANAGER
STAFF
STAFF
FUNCTIONAL
MANAGER
STAFF
STAFF
FUNCTIONAL
MANAGER
STAFF
STAFF

9. ADVANTAGES
oEmployees are grouped by their knowledge and skills.
oEfficiency is gained
oTheir roles and responsibilities are fixed
oThe hierarchy is very clear, and employees don’t have
to report to multiple supervisors
oEmployees have a clear career growth path.
oWithin the department, cooperation and
communication are excellent.

10. DISADVANTAGES
oIf the performance appraisal system is not managed
properly, conflicts may arise.
oCommunication is poor among the departments,
which causes poor inter-department coordination.
oEmployees may have little concern and/or knowledge
about events outside their department.
oGenerally, the functional manager makes decisions
autocratically without consulting the team members

11. DISADVANTAGES
oWhen the organization becomes larger, functional
areas can become difficult to manage due to their size.
oFunctional departments may be distracted by
departmental goals, and focus on them rather than
organizational goal.
oLack of diversity.
oLack of flexibility.

13. DIVISIONAL ORGANIZATION
When a company expands to supply goods or services
to a variety of customers, offers a variety of different
products or are engaged in business in several different
markets, the company could adopt a divisional
organizational structure.

14. DIVISIONAL ORGANIZATION
oA divisional structure groups its divisions according to
the specific demands of products, markets or
customers.
oA divisional organizational structure usually consists of
several parallel teams focusing on a single product or
service line.
oEach division will likely be structured as a functional
structure.

15. DIVISIONAL ORGANIZATION
Each division is given the resources, and autonomy, to
swiftly react to changes in their specific business
environment. Therefore, each division often has all the
necessary resources and functions within it to satisfy
the demands put on the division.

16. DIVISIONAL ORGANIZATION
Unlike departments, divisions are more autonomous,
each with its own top executive--often a vice president-
-and typically manage their own hiring, budgeting and
advertising.

19. TYPES OF DIVISIONAL
ORGANIZATION
1. Product based organizational structure
2. Market-Based Org Structure
3. Geographical Org Structure

20. DIVISIONAL: PRODUCT-BASED ORG
STRUCTURE

21. DIVISIONAL: MARKET-BASED ORG
STRUCTURE

22. DIVISIONAL: GEOGRAPHICAL ORG
STRUCTURE

23. ADVANTAGES
oDivisions work best for companies with wide variance
in product offerings or regions of geographic operation.
oIt affords the company greater operational flexibility.
oThe failure of one division does not directly threaten
the other divisions.
oIn the multidivisional structure, subsidiaries benefit
from the use of the brand and capital of the parent
company.

24. DISADVANTAGES
oA company comprised of competing divisions may
allow office politics instead of sound strategic thinking
to affect its view on such matters as allocation of
company resources.
oIn making each division independent some resources
could have been shared.

26. LINE AND STAFF ORGANIZATION
o One of the most common is the line and staff
organizational structure.
oThis consists of a line, which is managers who make
business decisions for their respective departments,
and a staff, whose members perform tasks in support
of the directives issued by the line.

27. THE LINE
The line comprises professionals whose day-to-day tasks
directly work toward accomplishing the organization’s
mission and goals.
For example, the research and development team creates
the products, while the supply chain manufactures them.
The marketing department works to raise consumer
awareness of the products and services, while the sales
group initiates customer transactions.
“The actions of the line generate the organization’s
revenue.”

28. THE STAFF
The staff is composed of every non-revenue generating
department.
Though these groups do not directly contribute to the
firm’s bottom line, their actions make those of the line
possible.
For example: The human resources department, for
instance, ensures that the line is staffed with top-tier
talent, content in their jobs.
Legal makes sure that the actions of the line and its
employees are within the scope of the law.

31. LINE-AND-STAFF CONFLICT
oMinimal conflict due to differences in viewpoints is
natural, conflict on the part of line and staff personnel
can disrupt an entire organization.
oPoor human relations, overlapping authority and
responsibility, and misuse of staff personnel by top
management

32. ADVANTAGES
oThe staff officers provide expert advice and guidance
to line officers
oSound decisions can be made easily.
oThe Staff officers look after the detailed analysis of
each important managerial activity.
oLine managers can work more efficiently with staff
managers handling specialized functions.
oStaff managers often play a support role to line
managers.

33. DISADVANTAGES
oConfusion between line and staff executives.
o Ineffectiveness of the staff.
oConflict between line and staff.