Functional structures tend to work best in relatively stable environments where problems are predictable and the demands for change and innovation are limited.

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Functional structures are designed to maximize efficiency and productivity by dividing the organization into specialized units and departments. These structures are most effective in stable environments where the tasks and responsibilities are consistent and predictable. In dynamic environments where rapid changes and innovation are required, organizations may need to be more flexible and adaptive, shifting to a more decentralized or matrix organizational structure.

Functional Structures Tend to Work Best in Relatively Stable Environments