Which type of organization is described as oriented around multiple major functional areas?

• A. Team organization
• B. Functional organization
• C. Hierarchical organization
• D. Matrix organization

Answer: (B)

The description of an organization that is oriented around multiple major functional areas corresponds to a functional organization. In this type of structure, the organization is divided into departments or sections that each specialize in a specific function, such as marketing, finance, human resources, or production. Each department operates independently but is aligned towards the overall goals of the organization. This allows for greater efficiency and depth of expertise within each functional area, fostering strong skill development and a clear career path for employees within those functions.

In contrast, a team organization emphasizes collaboration and typically involves interdepartmental teams rather than focusing solely on individual functions. A hierarchical organization emphasizes a clear chain of command and levels of authority, which can sometimes lead to rigidity and slowed decision-making. A matrix organization combines elements of functional and project-based structures, allowing for more flexible management but can also lead to confusion regarding authority and roles. Thus, the distinctive emphasis on major functional areas makes the functional organization the correct choice in this context.