Functionally-based Project-based Product-based Market-based Matrix-based Process-based Channel-based Category-based
Operating models
Functionally-based
The functionally-based operating model separates specialties such as marketing, product delivery and finance into divisions.
It operates well in a stable environment and is generally accompanied by centralised decision-making.
Advantages
- Encourages consistent standards and functional loyalty
- Complements centralised control
- Expedites vertical information flow
- Creates efficiencies through economies of scale
- Simplifies due to the clarity of roles and relationships
Disadvantages
- Responds slowly
- Lacks flexibility and common problem
- solving/goal focus
- Limits horizontal information flow
- Limits expertise made available to customers
- Suffers from coordination and control problems
- Tends to produce bottlenecks in business flows