Which one of the following is NOT true for the functional organization?

Option 1 : It is based on the principle of unity of command

The incorrect statement is "It is based on the principle of unity of command"

 Functional Organisation:

• A functional organisational structure differentiates the employees based on their expertise, specialisation, etc.
• It is entirely dependent on a ranking system made up of many departments that are led by knowledgeable experts.
• Most firms adopt a functional structure because it brings together employees with complementary expertise and abilities who, when working together as a team, can assist the business achieve its objectives.

 Explanation of statements:

1. It is based on the principle of unity of command:

• This statement is incorrect as functional organisation violates the principle of unity of command since a person is accountable to a large number of bosses.

2. Discipline tends to break down not only among workers:

• This statement is correct as The division of authority leads to discipline issues. The workers have to obey many bosses their loyalty becomes divided. Not just among employees, but also among lower level supervisors, discipline frequently fails.

3. It is useful for large-scale business:

• This statement is correct. Large businesses can benefit from functional organisation since it divides an organisation's activities into key functional areas like IT, finance, and marketing.

4. Functional managers are specialists in their respective areas:

• This statement is correct as Functional managers are considered as specialists who are in charge of functional areas (such as operations, marketing, and finance, etc.), each of which is given a specific set of functional tasks.