Departmentation by Process: Advantages and Disadvantages

Departmentation by process refers to the grouping of activities based on the type of work being performed. This approach is used in organizations where work is performed in a series of processes and where the same type of work is performed repeatedly. The following are the advantages and disadvantages of departmentation by process.

Advantages:

1. Improved work flow: By grouping similar activities, work flows can be improved as there is a clear understanding of the tasks being performed, who is responsible for performing the tasks and the resources needed to complete the tasks.
   
   
2. Better coordination: Departments that are based on process often have a common goal, which is to produce a product or service that meets customer requirements. This common goal promotes better coordination among departments and reduces the risk of duplication of efforts.
   
   
3. Better control: By grouping activities based on process, it is easier to identify areas of inefficiency and to implement corrective action. This is because the manager has a better understanding of the work being performed, the time required to complete the work and the resources required to complete the work.
   
   
4. Improved efficiency: By focusing on process, the manager can identify areas where improvements can be made to increase efficiency. For example, by streamlining processes and reducing the number of steps required to complete a task, the manager can improve efficiency and reduce costs.
   
   

Disadvantages:

1. Lack of flexibility: Departmentation by process can limit the ability of the organization to respond quickly to changing customer requirements or market conditions. This is because processes are often set in stone and changes require a significant effort to implement.
   
   
2. Lack of cross-functional communication: By grouping activities based on process, there is a risk of poor cross-functional communication. This can lead to a lack of understanding of the work being performed in other departments and a lack of understanding of the impact of decisions made in one department on other departments.
   
   
3. Risk of suboptimization: By focusing on process, there is a risk of suboptimization, where the focus on process results in decisions that are not in the best interest of the organization as a whole.
   
   
4. Potential for conflict: By grouping activities based on process, there is a risk of conflict between departments. This can occur when departments are competing for resources or when there is a lack of understanding of the work being performed in other departments.
   
   

In conclusion, departmentation by process can provide benefits in terms of improved work flow, better coordination and better control. However, it can also have disadvantages such as lack of flexibility, lack of cross-functional communication, risk of suboptimization and potential for conflict. Organizations must carefully consider the advantages and disadvantages of departmentation by process before deciding if this approach is right for their organization.