For firms organized around functional structure, the real problems arise when:
A)Top managers must envision their succession
B)The firm grows its range of products and businesses
C)Divisions cannot communicate to each other
D)The economy is in bad shape

Question

Quizplus · Accepted Answer

Functional structure works well when the organization has a narrow focus and limited product line. As the firm expands its range of products and businesses, it becomes difficult for functional groups to work collaboratively without communication issues arising. This is especially true when the products and businesses have vastly different requirements, making it challenging for each functional group to align their activities with each other. Therefore, option B is the correct answer.

For Firms Organized Around Functional Structure, the Real Problems Arise