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Disadvantages Of Functional Departmentalisation In A Modular Organization

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Firstly, functional departmentalisation coordinates work and employees through different units. Departmentalisation based on functions is used widely by organisations. Functional departmentalisation requires employees with the same knowledge, skills, and resources to allow them to work efficiently and promotes the development of greater expertise. For instance, departmentalisations according to functions are accounts, sales, marketing, production, operations and human resource department. This department has its advantages in where it allows work to be carried out by individuals who are qualified and skilled in the areas concerned. Besides that, it also reduces cost by decreasing work duplication and use of resources in the organisation. However, …show more content…

It outsources business activities to other organisations, suppliers, experts or consultants. Modular organization involves several largely independent bodies that can reorganise and work with diverse departments as required. This design has many advantages, one of it is the payment of outsourced activity such as labour, experts and production capabilities are only required when the transaction takes place. Besides that, it increases organisations flexibility and ability to restructure easily. For instance, a firm can switch between different providers and thus respond more quickly to different market needs. Consequently, this design allows an organisation to perform well, fast and cheap compared to other organisations. Virtual organisation refers to a design that involves flexible network of independent entities associated by telecommunication and computing technologies to share skills, services, knowledge and access to expertise in non-traditional ways. Virtual organisations have long relationships that are shorter and temporary with the organisations in its network. It allows organisations that are involve in the network to share all costs involved as the members of the network combine equal level of efforts in fulfilling the needs of consumer by producing the best products and services in all

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