© examsnet.com
Question : 15
Total: 32
Aradhana and Gandharv are heads of two different departments in 'Yumco Ltd.' They are efficient managers and are able to motivate the employees of their respective departments to improve performance. However, their drive to excel in their own sphere of activity instead of giving emphasis on objectives of the enterprise has hindered the interaction between the departments that Aradhana and Gandharv are heading. Often there are inter-departmental conflicts and they have become incompatible. This has proved to be harmful in the fulfilment of the organisational objectives. The situation has deteriorated to such an extent that the CEO of 'Yumco Ltd.' has hired a consultant, Rashmi, to resolve the problem. After studying the situation closely, Rashmi found that the problem has arisen due to inflexibility and a narrow perspective on the part of both Aradhana and Gandharv. She is of the view that this situation is a result of the type of organisational structure 'Yumco Ltd.' has adopted.
From the above information, identify the organisational structure adopted by 'Yumco Ltd.' and state any three advantages of the structure so identified.
From the above information, identify the organisational structure adopted by 'Yumco Ltd.' and state any three advantages of the structure so identified.
Solution:
The organisational structure adopted by 'Yumco Ltd.', is 'functional organisational structure'.
The advantages of functional organisational structure are as follows:
(i) Functional specialisation: It promotes specialisation since each department has to perform a specific function. As employees perform similar task within a department, it improves their efficiency and they are able to gain specialisation.
(ii) Improves efficiency: Expert and experienced officers are specially appointed for each functional department. It helps in increasing managerial and operational efficiency and this results in increased profits.
(iii) Avoid duplication: It helps in avoiding duplication of efforts, which leads to economies of scale and reduces the cost of production.
The advantages of functional organisational structure are as follows:
(i) Functional specialisation: It promotes specialisation since each department has to perform a specific function. As employees perform similar task within a department, it improves their efficiency and they are able to gain specialisation.
(ii) Improves efficiency: Expert and experienced officers are specially appointed for each functional department. It helps in increasing managerial and operational efficiency and this results in increased profits.
(iii) Avoid duplication: It helps in avoiding duplication of efforts, which leads to economies of scale and reduces the cost of production.
© examsnet.com
Go to Question: