Explain the Different Basis of Departmentalization with Their Respective Advantages and Disadvantages

In: Business and Management

Submitted By charpoka
Words 1354
Pages 6
Q: Explain the different basis of departmentalization with their respective advantages and disadvantages.
ANS:
Departmentalization involves dividing an organization into different departments, which perform tasks according to the departments' specializations in the organization. Departmentalization as a means of structuring an organization can be found in both public and private organizations. An organization can structure itself into departments in the following ways.

Departmentalization by function
This is common and popular basis of departmentalization of an enterprise. Under this form, various departments are created on the basis of nature of functions to be performed like production, marketing, finance, personnel etc. A departmental head or manager is appointed to supervise and control the activities of the concerned department. All departmental heads are specialists and experts in their own area of business. When workload of a particular department becomes more, a department may again be classified into sub departments. Since the members working in a department have similar background and interest, it gives rise to specialization which makes manpower more efficient and skilled.

Advantages of Departmentalization by Function * It is most logical and natural form of departmentalization. * It brings about specialization which makes optimum utilization of human resources. * It lays emphasis on each and every activity. * It enables top management to exercise control over a number of functions. * It facilitates delegation of authority and therefore, reduces the work burden of top manager. * It eliminates the duplication of effort which brings efficiency.
Disadvantages of Departmentalization by Function * There may be conflict between departments as the responsibilities are inter-dependent. * There may be difficulty in coordinating the…...

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