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Types of Departmentalization
There are five types of departmentalization in organizations: functional, product, customer, geographical, and process. In this essay, we shall discuss the four main types and give their advantages and disadvantages.
Functional Departmentalization
In Functional departmentalization, the organization’s departments are separated into groups differentiated by the functions they perform, for example, the Human resource department, Finance department. This type allows the organization to staff the essential positions with functional experts and facilitate coordination and integration.
This type has its advantages, including a logical reflection of functions that maintain the power and prestige of significant processes, follows the principle of occupational specialization, simplifies supervision, and trains subordinates. It also makes coordination of activities in the department easy, staff each department with experts, and furnishes tight control at the top.
The disadvantages of functional departmentalization include, Slows down decision making and increase bureaucracy, development of general managers is limited, monitoring of performance and accountability becomes difficult, coordination between departments is reduced and makes key personnel to adopt a narrow and overspecialized points of view.
Departmentalization by customer group
Unlike functional departmentalization, this type separates the organization in readiness to respond and interact with specific customers or groups of customers. It is used mainly when the emphasis is placed on the adequate serving of various types of customers.
The advantages include; it encourages concentration on customers’ needs, expertise in customer area is developed, saves customers time, and gives the customer a feeling that the suppliers are understanding. It also has some disadvantages: coordination of operations between competing customers may be difficult; it requires that the managers and staff are experts in customer problems, and finally, customers may not always be clearly defined.
Geographical Departmentalization
This type is often used when division appears feasible according to some geographic market segregation. Unlike in customer and functional departmentalization, this type favors when the low cost of operation and attraction is involved.
The advantages of geographical departmentalization are; gives room for general managers’ training, promoting face-to-face communication, improving coordination, and emphasizing local markets and problems. However, it has some disadvantages, which include; it requires more persons with general management skills, makes maintenance of economically central services difficult, and increases the problems associated with top management control.
Product Departmentalization
This type is only logical when the equipment involved requires a specific skill for operating or requires a technical facility that requires a concentrated location. The advantage is that it uses specialized technology, simplifies training, and achieve economic benefits. The disadvantage is that departmental coordination is complicated and is unsuitable for developing general managers.
Work cited
“Departmentalization: Definition, Types (How Departmentalization Works)”. Iedunote.Com, 2020, https://www.iedunote.com/departmentalization. Accessed 24 Sept 2020.