Business – 7.1 Organisational structure – Types of structure | e-Consult

Advantages

• Specialisation – staff develop deep expertise in their functional area, improving efficiency and quality.
• Clear chain of command – reporting lines are simple, reducing confusion about authority.
• Economies of scale – resources such as equipment and training can be shared within the function.

Disadvantages

• Silo mentality – departments may focus on their own goals rather than overall organisational objectives.
• Slow decision‑making – cross‑functional coordination often requires multiple layers of approval.
• Limited flexibility – adapting to market changes can be difficult because functions are rigidly defined.