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Functional structure, a main business structure, which is always used by median sized companies. In the business area, to choose a suitable organizational structure to encourage innovation is one of the necessary conditions to make business successful. Innovation is the process of bringing in new services and products. (XXX) Among them, the functional organization is a common one. According to Bateman and Snell (1999:287), it divides business into several different departments (task forces), each with its own function, such as accounting, production and human resources. There is a heated discussion about whether the functional structure is the best company organization, and most likely to facilitate business innovation, eventually help business to be successful. This essay will analyse and demonstrate a well-structured hierarchy, which can accelerate company innovation ability and promotes its successful.

One of the significant advantages of functional structure is that it can dramatically increase the capability of innovating to the company. Based on this structure, professional staff will be hired by the company and each department can focused on their own responsibility. The benefits of this structure have been demonstrated at Starbucks, according to (XXX), Starbucks has set up product-based divisions such as the coffee division and the bakery division. This organizational structure enables Starbucks to enhance its ability to develop and innovate its products. It can be observed that, more professional ideas will be provided by specialized staff to optimize its role, such as products and marketing. According to XXXX, the functional structure can be the most efficient mobilization of employees' professional skills allows them to play the greatest role in a particular area. (XXX) This advantage not only allows employees to work more efficiently in particular department, but also can makes idea sharing within the same department become faster. It is foreseeable that internal faster information sharing can make a significant increase in terms of the ability of innovation in each department. At the same time, the cooperation between professionals will bring more space for innovation and make it easier to assign tasks. This hierarchy not only enhances the synergies among employees, but also enhances the engagement between employee and managers in the department. On the other hand, employee innovation and employee motivation are closely related. The self-motivation of employee will greatly improve the possibility of company’s success, motivated employees often can create unexpected value for the company. As XXX mentioned that, a finding of perfect solution to a thorny issue can raise the self-identity of employees, and self-identity is the essence of self-motivation. (XXX). A well-division of labor and professionalism of staff might make thorny problems be solved easier, the employee's self-worth more easily be reflected. Based on this structure, a virtuous circle of self-motivation will be established. At a result, with this organizational structure, this advantage could occur in each department, which will greatly improve the operational efficiency of the entire company.

Another irreplaceable advantage of this organizational structure is departmental specialization, which is leading to efficient operation and innovation, has been proven in many enterprises and stranded the test of time and market. One of the most persuasive examples is the fast-food company called McDonald, which has laid the foundation by this hierarchical structure to been successful. According to the survey data collected by XX, nowadays, McDonald has more than 30,000 franchise stores in 119 countries around the world, and it providing service for 47 million customers in every single day, which also brings 15 billion annual revenue. (XXX). Such a company size and profitability are undoubtedly astonishing, nonetheless, the size of a company is often directly proportional to the difficulty level of management. It is clear that McDonald's offers very similar foods and services at every franchise, which has brought a great convenience to the expansion of McDonald. However, at the same time, it also brought some drawbacks. For instance, the monotonous products and services may not be able to meet the needs of customers in every region of the world. Fortunately, functional structure played an important role at this time. It can be seen that, the Product innovation in different regions brought a huge challenge. In this case, an independent department of production has become a necessary condition for solving this problem. As I have shown, benefit from a precise division of labor under this structure, the role played by each department could be even more immediate. In addition, as mentioned by XXX, the marketing department of McDonald's promotes its brand image through a variety of social activities and it also sponsored a plenty of international events. (XXX). This is owing to independent function brought more efficient operation, the organizational structure has given a chance to its marketing department to benefit maximizing for its function. As a result, a several novel ideas to enhance the brand image has been presented. This case example shows that this hierarchy is not limited to medium-sized companies, the great advantages, encourage innovation and efficient functioning, can also be clearly demonstrated in large-scale companies.

Even though there are many obvious advantages of functional structure, some entrepreneurs might think that the cooperation between functions are very difficult. Although this organizational structure clearly increases the operational capacity of the company, this structure poses a huge problem for the management of company and the administrative costs may increase. As mentioned by Strese et al. (2015), under this hierarchical structure, cooperation and competition among various departments coexist, the complexity of interdepartmental relationships poses a challenge to the overall management of the company. However, problems arising from complex departmental relations can be solved by raising inter-communication mechanisms. With the advent of a variety of new communication technologies, the efficiency of information transmission has been greatly enhanced. Efficient communication technology has facilitated communication and cooperation among departments. Therefore, the management challenge brought by functional structure does not hinder its improvement of the company's innovation capability.

In addition, some people might think that senior management is overloaded with routine matters under this hierarchy. The overall management of the company has a decisive influence on the success of company. Among them, a very important factor is functional integration. As the functions of each department are relatively independent, senior management may need to devote more time and energy to arrangements for different departments to achieve a reasonable balance. According to XX's point of view, a highly differentiated firm can be successful if it can improve the ability of integration to link it up through the work of different departments. (XXX) This is because each individual department is actually contributing to the company's overall goal. In some cases, the managers may be overwhelmed by the functional cooperation. However, this problem is not without solution. The main reason of decentralized functions problem is not arising from functional structure. A more important reason is that the management mechanism of the company is not reasonable enough for specific company. Under such circumstances, establishing an independent department to in charge for the communication and collaboration among various departments could be a very effective method. And it can also manage the routine matters of the company, thus this approach may greatly reduce the workload of senior management.

This essay has testified that functional structure is a well-hierarchy that strengthens the company's ability to innovate and helps businesses succeed. The benefits it brings, which can encourage innovation and improve operational capability of the company has been proved. It is clear that, a refined labor division and the innovation bringing by professionals are the needed of every company. However, comparisons with other major business structures has not been analyzed. It can be seeming that the advantages of this structure have been showed in different aspect and being used at top-size companies such as Starbucks and McDonald's. A suggestion is that, entrepreneurs should give more consideration to integrate ability of company when functional structure has been chosen.