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Home Questions 2UT7Q9VP7K
Target Exam

CUET

Subject

Business Studies

Chapter

Organising

Question:

Which of the following is true in the context of organising function of management?

Options:

Functional structure is economical because functions are not duplicated.

Divisional structure is costly because there is duplication of resources in various departments

Both 1 and 2

None of the above

Correct Answer:

Both 1 and 2

Explanation:

The correct answer is option 3- Both 1 and 2.

The cost involved in functional organisation structure is comparatively less as the functions are not repeated. Unlike, the divisional organisational structure wherein there is the repetition of resources, and so it is costly.

Comparative view: Functional and Divisional Structure

S No

Basis

Functional Structure

Divisional Structure

1

Formation

Formation is based on functions

Formation is based on product lines and is supported by functions.

2

Specialisation

Functional specialisation.

Product specialisation.

3

Responsibility

Difficult to fix on a department.

Easy to fix responsiblity for performance

4

Managerial Development

Difficult, as each functional manager has to report to the top management.

Easier, autonomy as well as the chance to perform multiple functions helps in managerial development.

5

Cost

Functions are not duplicated hence economical.

Duplication of resources in various departments, hence costly.

6

Coordination

Difficult for a multi-product company.

Easy, because all functions related to a particular product are integrated in one department.

 

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