Question

Fresh Foods Pvt. Ltd. manufactures and distributes organic packaged food products. It’s operations are divided into five main departments – Production, Marketing, Finance, Human Resources and Research and Development. Each department has its own head and a team that focuses only on the work related to their department. This promotes efficiency in utilization of manpower as employees perform similar tasks within a department and are able to improve performance. This also helps in increasing managerial and operational efficiency and results in increased profit. Since each department handles a narrow range of tasks and focus is on a limited range of skills, it is easier to train new employees. Identify the organization structure followed by Fresh Foods Pvt. Ltd.

Hint:

Remember: When departments are formed based on primary jobs or functions (like Production or Marketing), it is always a Functional Structure.

Answer 1

Correct Answer: 4

Step 1: Read the key feature in the case.
Fresh Foods Pvt. Ltd. has divided its operations into five main departments - Production, Marketing, Finance, Human Resources, and Research and Development - each with its own head and team focused exclusively on work specific to that department.
Step 2: Identify the basis of departmentalization.
The company has grouped its activities based on primary business functions. Each department is defined by a distinct functional activity (e.g., producing, selling, managing money, managing people, developing new products). This is the central idea of one specific organizational structure.
Step 3: Name the structure.
The organizational structure followed by Fresh Foods Pvt. Ltd. is the Functional Structure (also called Functional Organization).
Step 4: Define Functional Structure.
In a functional structure, the organization is divided into departments based on the major functions it performs. Each functional department is headed by a specialist who is an expert in that particular area. Employees within each department perform similar, related tasks.
Step 5: Connect the definition to the case.
The case explicitly confirms: employees within each department perform similar tasks (promoting specialization), it is easier to train new employees (because skills are narrow and focused), and it leads to increased managerial and operational efficiency, all of which are characteristic advantages of a functional structure.
Step 6: Conclude.
Fresh Foods Pvt. Ltd. follows a Functional Structure, where the organization is divided into departments based on specialized business functions such as Production, Marketing, Finance, HR, and R and D.
\[ \boxed{ \text{Organizational Structure: Functional Structure} } \]