In a functional structure:
A) a firm groups diverse functions into separate divisions.
B) a firm is organized in terms of the main activities that need to be performed.
C) a firm gives equal authority to both divisional and functional managers.
D) a firm categorizes its employees based on their performance and commitment.

Question

Quizplus · Accepted Answer

In a functional structure, a firm is organized in terms of the main activities that need to be performed. Diverse functions are grouped into specific departments or teams based on their specialized activities, such as finance, marketing, production, and so on. The organization is hierarchical, and the employees have clear lines of reporting and supervision. In a functional structure, the authority is typically concentrated at the top of the organization, with functional managers having more say over their respective activities than the divisional managers. Therefore, choice B is the best answer. Choices A, C, and D don't accurately describe the characteristics of a functional structure.

In a Functional Structure