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Say how the functional organizational structure can cause an obstacle to an efficient running of enterprise processes? How reengineering business processes or having an integrated enterprise system can help resolve the difficulty facing a functional organizational structure?Explanation / Answer
Functional organization structure is not suitable for an organization which is growing rapidly. Because decision making lies with people sitting at the top, so decision making takes time. Inter-communication between two funcitonal groups is not fast. When processes cross the boundaries of multiple functional areas, the queue times added by each area can greatly increase the time required to complete an entire job. When everyone in the company is herded into clusters of functional silos, there are few people left who are capable of seeing the total strategic direction of the company, which can result in a very difficult decision-making process.
Having an integrated enterprise system can help the company to overcome shortcoming of functional organization structure. It helps in synchronizing the task between different functional groups efficiently.When data is entered into a enteprise systems which is centralized and consistent, there’s no reason why departments can’t work together. Systems are scalable new functions resources users etc. can be added easily without impacting efficiency.