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Organisation The classicists have used the term Organisation in the form of organising which is a part of management process. Presently, the term Organisation is used in following ways: ,[object Object]
As process
As structure
As group of people,[object Object]
Functional Organisation Structure Functional organisation structure is the which where “authority rests with the functional heads; the structure is sectioned by departmental groups.”                                                                                                                  -Teams in Engineering Education  						 Arizona University It is a  kind of Formal Organisation whose structure is based on organising resources to perform specialized tasks or activities in order to attain the goals of organisation.
This structure emerges from the idea that the organisation must perform certain functions in order to carry on it’s operations. Functional structure is created by grouping the activities on the basis of functions required for the achievement of organisational objectives. For this purpose all the functions required are classified as shown below:-
The basic  or major functions are those which are essential for the organisation. Consider , the following examples, Movie-making : The key person is the castingdirector.  The concept of casting extends not only to the actors, but also to choosing the array of technical and support people.  These decisions are critical to the success of the movie.  Everyone has a unique and special personality.  It is the job of the casting director to coordinate these personalities in such a fashion that everyone can function together.  Such decisions can make or break the movie.  
Manufacturing  Organisation : Production and Marketing are basic functions when departments are created on the basis of functions and a manager feels that his span of management is too wide to manage effectively , which  normally happens in a large organisation. Several departments are created  on the basis of dividing basic function into sub-functions. Eg. Marketing can be sub-divided as shown ,
Apart from basic and secondary functions , departments are also created  to take advantages of specialization  & to support basic  and secondary activities. Such departments may be finance , accounting , personal , industrial relations , legal etc.
Characteristics of Functional Organisation
Organisation chart of  functional structure. Courtesy : The Internet.
Suitability of Functional Structure ,[object Object]
In such a case more formalized and systematic approach is required to handle situations.
However , the top management will continue to control decisions involving strategies & co-ordination.,[object Object]
Brings order and clarity.
Promotes professional achievement.
Proper usage of organisational resources.
Higher control and coordination of functions.,[object Object]
Specialization may lead to goal displacement.Therefore  , if there is too much emphasis on any aspect it may lead to dysfunctional behaviour of that aspect. The Functional Structure isn’t suitable to an organisation that involves diversification.
Now the question that might be arising in your mind is WHY it isn’t suitable? The reasons are likewise :- ,[object Object]
Slow decision making process because the problem requiring decision has to go through various departments.,[object Object]
Enables in depth knowledge & skill development.
Enables organization to accomplish functional goals.
Best for one or few products.
Slow response time to environmental changes.

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Organization Structure & Details

  • 1.
  • 4.
  • 5. Functional Organisation Structure Functional organisation structure is the which where “authority rests with the functional heads; the structure is sectioned by departmental groups.” -Teams in Engineering Education Arizona University It is a kind of Formal Organisation whose structure is based on organising resources to perform specialized tasks or activities in order to attain the goals of organisation.
  • 6. This structure emerges from the idea that the organisation must perform certain functions in order to carry on it’s operations. Functional structure is created by grouping the activities on the basis of functions required for the achievement of organisational objectives. For this purpose all the functions required are classified as shown below:-
  • 7. The basic or major functions are those which are essential for the organisation. Consider , the following examples, Movie-making : The key person is the castingdirector.  The concept of casting extends not only to the actors, but also to choosing the array of technical and support people.  These decisions are critical to the success of the movie.  Everyone has a unique and special personality.  It is the job of the casting director to coordinate these personalities in such a fashion that everyone can function together.  Such decisions can make or break the movie.  
  • 8. Manufacturing Organisation : Production and Marketing are basic functions when departments are created on the basis of functions and a manager feels that his span of management is too wide to manage effectively , which normally happens in a large organisation. Several departments are created on the basis of dividing basic function into sub-functions. Eg. Marketing can be sub-divided as shown ,
  • 9.
  • 10. Apart from basic and secondary functions , departments are also created to take advantages of specialization & to support basic and secondary activities. Such departments may be finance , accounting , personal , industrial relations , legal etc.
  • 12. Organisation chart of functional structure. Courtesy : The Internet.
  • 13.
  • 14. In such a case more formalized and systematic approach is required to handle situations.
  • 15.
  • 16. Brings order and clarity.
  • 18. Proper usage of organisational resources.
  • 19.
  • 20. Specialization may lead to goal displacement.Therefore , if there is too much emphasis on any aspect it may lead to dysfunctional behaviour of that aspect. The Functional Structure isn’t suitable to an organisation that involves diversification.
  • 21.
  • 22.
  • 23. Enables in depth knowledge & skill development.
  • 24. Enables organization to accomplish functional goals.
  • 25. Best for one or few products.
  • 26. Slow response time to environmental changes.
  • 30. Restricted view of organization goals.“what is the right organization structure ? Decision tree analysis provides the answer” Organisational dynamics – Robert Duncan
  • 31.
  • 32.
  • 33. Client is NOT the focus.
  • 37. Low staff motivation. Courtesy : The Internet.
  • 38. Product/Market Organisation Many markets are classified on the basis of product and trading relationships.The level of market organisation is largely determined by the new imperatives of the rising level of economic development. In the non-monetised barter economy there is, perhaps, no necessity of modern market-organisation as such. The "money economy" grows with the separation of production, consumption and distribution. In the exchange economy there is structured processes of production, distribution and delivery. The article of interdependence is fairly high. All economic activities get increasingly market-determined and market-oriented. 
  • 39. It may also be noted that the generation of "marketable surplus" (commercial surplus) marks a fountainhead of the development of market organisation. Greater the marketable surplus higher the market organisation. The changing composition of the marketable surplus is another added impetus. Diversification is really inspiring. The rising market-interaction becomes a fertile ground for higher per capita income (greater purchasing power), faster change in the composition of output and taste and preference of the consumers. Because, Supply acts on Demand.
  • 40. Factors that strengthen market organisation
  • 41.
  • 43.
  • 48.
  • 49.
  • 50. Market Organisation Chart Courtesy : The Internet.
  • 51. Credits The Internet. Market Organisation by Weisbuch, Gerard, Alan Kirman, and Dorothea K. Herreiner , University of Bonn , Germany.
  • 53. Thank You! Presented by : Ashutosh Mishra MBA – 1st. sem