Grouping the jobs of similar nature and organising them as a separate department creates :

A functional Structure

The correct answer is option (1)- A functional Structure.

Grouping the jobs of similar nature and organizing them as a separate department creates a "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.  The functional structure has many advantages to offer. Some of them are as follows:

(1) A functional structure leads to occupational specialisation since emphasis is placed on specific functions. This promotes efficiency in utilisation of manpower as employees perform similar tasks within a department and are able to improve performance.

(2) It promotes control and coordination within a department because of similarity in the tasks being performed.

(3) It helps in increasing managerial and operational efficiency and this results in increased profit.

(4) It leads to minimal duplication of effort which results in economies of scale and this lowers cost.

(5) It makes training of employees easier as the focus is only on a limited range of skills.

(6) It ensures that different functions get due attention.