__________ structure is most suitable when the size of the organisation is large, has diversified activities and operations require a high degree of specialisation.

Functional

The correct answer is Option 1- Functional

Functional structure: Grouping of jobs of similar nature under functional and organising these major functions as separate departments creates a functional structure. All departments report to a coordinating head. For example, in a manufacturing concern division of work into key functions will include production, purchase, marketing, accounts and personnel. These departments may be further divided into sections. Thus, a functional structure is an organisational design that groups similar or related jobs together. It is most suitable when the size of the organisation is large, has a diversified activities and operations require a high degree of specialisation.