Assessing Structural AlternativesEach of the four most common types of departmentalization has major advantages and disadvantages.A. Functional structure is a type of departmentalization in which positions are grouped according totheir main functional (or specialized) area.1. Typical functional form of organization has several major advantages.2. The functional form of organization has several major advantages.a. In-depth development of expertise is encouraged.b. Employees have clear career paths within their function.c. Resources are used more efficiently.d. Economies of scale may be possible because of specialized people and equipment.e. Intradepartmental coordination is facilitated.f. Specialized technical competencies may be developed and may constitute a competitiveadvantage.3. The functional form of origination has several disadvantages.a. Response time on multifunctional problems may be slow due to coordination problems.b. Major issues and conflicts between departments may have to be resolved by topmanagement, with resultant delays.c. Bottlenecks due to sequential tasks.d. Over specialization may lead to a restricted view of the department’s and the organization’sneeds.e. Performance may be difficult to measure because several functions are responsible fororganizational results.f. Managers may be trained too narrowly in a single department.4. The functional form of departmentalization is more appropriate under certain circumstances.a. The organization is small or medium-sized.b. There is a limited number of related products or services, or a relatively homogeneous setof customers or clients.c. The organization is large and diverse, but the environment is stable.B. Divisional structure is a type of departmentalization in which positions are grouped according tosimilarity of products, services, or markets.1. Divisional structures are also called “self-contained structures” because each division containsthe major functional resources it needs to pursue its own goals with little or no reliance onother divisions.2. The three major forms of divisional structure differ according to the rationale for forming thedivisions.a. Product divisions are divisions created to concentrate on a single product or service or atleast a relatively homogeneous set of products or services.b. Geographic divisions are divisions designed to serve different geographic areas..