If executed properly, a functionless organisation can improve the efficiency and agility of your business. Moving toward an organisation that is product- or process-focused, and that emphasises cross-functional collaboration, may be the change you’re looking for.
Simply changing the structure of the organisation does not guarantee success, though. This article is going to touch on different organisational structures, as well as how to keep up performance as a functionless organisation.
4 Common Organisational Structures And Their Uses
Before implementing a functionless organisational structure, it is important to consider all your options. This means getting familiar with the most common organisational structures.
These organisational structures are often used throughout the business world:
Hierarchical
This is the most common structure and is often depicted as a pyramid. Business leaders are at the top of the structure, their direct employees branch out underneath them, and so on.
There are multiple tiers of authority and groupings may be functional, geographical or related to the products or services offered by the business.
Functional
Instead of employees being grouped under supervisors, functional structures see groupings through roles, specialisations or responsibilities.
Managers of the respective departments (think Marketing or Sales) have supervisors who oversee other departments as well.
Divisional
Similar to functional structures, this organisational structure sees companies split into distinct parts based on specific aspects such as services or geography. The divisions have their own leadership, teams and resources. Often, this structure is used by parent companies that own smaller businesses, or by large companies that have different locations.
Team-based
Organisations that make use of a team-based structure tend to be quite flexible. Employees can move between teams as needed. They are grouped by skill and work on tasks that form part of a broader company goal. Problem-solving, cooperation and collaboration are key in this structure.
The Advantages And Disadvantages Of A “Functional” Organisation
Most organisations follow a functional structure. While this has certain benefits, it also comes with several disadvantages.
Advantages
A functional organisation groups employees by specialisation. This means that the business can depend on each department having the skills necessary to undertake relevant tasks.
A level of specialisation can also benefit operational speed, as less experienced staff can easily approach senior employees in their department or function for help when necessary.
Dividing employees into functions can also offer clarity when it comes to staff responsibility or the delegation of tasks.
Disadvantages
‘Functional’ organisations can create division between departments, resulting in silos. It prevents employees from being exposed to other departments. This can negatively impact the collaborative culture in the business, which can be harmful to long-term progress. It can also lead to a lack of coordination, as there is less communication between functions.
Moreover, functional division in a business can lead to less clarity and drive towards the overarching organisational goals, since each department would have developed its own goals.
Lastly, if resources are shared between functions, disputes can arise from low levels of cooperation. Conflict can arise if departments are competing for the same limited resources.
How Can Organisations Become Functionless And Still Perform?
It’s clear that there are many disadvantages to having a functional organisational structure. As such, it may be beneficial for businesses to move toward a collaborative, functionless structure. Instead of functional silos, organisations can have process-complete departments that can focus on meeting customer needs better.
Process-complete departments are able to perform the majority, or all, of the cross-functional steps or tasks necessary to meet client needs. In order for a product- or process-focus like this to work, cross-team collaboration is essential.
A functionless business will be able to perform efficiently. However, it takes more to be successful than simply changing from function-based to process-complete departments.
It’s vital to put the right systems in place to facilitate cross-team collaboration and enable easy access to information.
Moreover, organisations need to focus on changing the way employees work and communicate with each other. It’s important to reinforce good collaborative practices, set common goals for teams to work toward and eliminate functional mindsets.
Why Is Product-Process Focus And Cross-Team Collaboration Important?
To become a functionless organisation, departments will need to be able to cover a variety of tasks and responsibilities. This includes everything from product manufacturing and maintenance to delivering products to customers and obtaining feedback.
Therefore, process-complete departments must place a heavy focus on cross-team collaboration in order to achieve their goals. Everyone in the department must be able to collaborate and communicate well so that they can complete their tasks effectively.
One noteworthy study investigated the effectiveness of process-complete departments. It found that a heavy focus on process improved customer satisfaction and cycle times, as well as lowered costs. However, these benefits were only realised by companies with a collaborative culture.
So, to create an environment that will thrive under a functionless structure, it is crucial to bolster collaboration.
Tips To Start Optimising Your Organisation To Become Functionless
Cross-team collaboration is integral to the idea of a functionless organisation. We’ve collected some top tips for fostering a collaborative culture within your business.
1. Broad range of duties
By designing jobs to have overlapping responsibilities, or only offering a small number of job titles, each employee will be exposed to a wide range of duties. This means that employees will share a sense of responsibility and objectives.
2. Rewards for teams, not individuals
Basing rewards off individual performance might be perpetuating a divided mentality. This is regardless of what type of reward it is - financial or other. Team rewards will encourage employee collaboration, as the team will have a common motivating factor.
3. Make collaboration easier
Workspaces that allow employees to see each other's work can improve collaboration as well as productivity. For this reason, consider changing the physical layout of the office to one that is more open.
Implementing a central channel of communication is also very important for boosting cross-team communication. It will make it easy for employees to ask for advice, share information and ideas, and keep up with each other’s progress for various tasks.
4. Restructure work processes
Management teams should actively try to encourage employees to voice their opinions and thoughts so that decisions and management structures can be decided on collectively. When it comes to decision-making procedures, employees should be encouraged to involve all who will be affected by such procedures. Staff should also be enthusiastic to assist other employees with their work.
Final Thoughts
Traditional business structures aren’t the only option. Functionless organisations are an attractive alternative, where product processes and cross-team collaboration are essential.
Functionless organisations can even be more efficient than ‘functional’ businesses when implemented correctly. To recognise these benefits, it's integral to place a strong emphasis on cross-team collaboration.
If your organisation is looking for a tool to involve all employees in idea generation for better decision-making on workplace and business strategies, have a look at the Falcony Platform. It enables your staff to participate in creating clarity on non-conformities, give feedback, ideas and input for the business, as well as preventing and decreasing the amount of friction in cross-team communications, and gather actionable data in the process:
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