Under the functional structure, the organization is in more of a "team" structure. For example, the company would be structured into departments such as the finance department or compliance department. This type of structure is great for those companies that are smaller in size, perhaps less than 100 employees because it relies heavily on the knowledge of all employees (Writing, 2012). With that said, sometimes having a functional structure will keep departments from communicating with the other departments because each team has a specific function. Companies with a functional structure may find themselves spending time working with the employees to “drop the communicative walls”. Medtronic, a pharmaceutical company, for example, uses a functional structure combined with a top-down approach (Kimes, 2009).
In a product structure, the company is divided based on the product that the division is producing. For example, a company that produces cars may have an engine division and a transmission division because it is product-based. While the product segmentation has similar drawbacks to the functional structure, there are significantly more restrictions. A company in a product type set up is not leveraging their employees in the fullest extent; think of this as a company with “walls” up, the employees do not leave their division or “walls”; therefore, they are not taking advantage of all the employees’ knowledge. 3M – another pharmaceutical company – is product based company (Kimes, 2009). This is an example of how companies that are in the same industry use very different organization approaches.
A geographic structure is widely used in companies that are widespread such as Volkswagen or Merck Pharmaceuticals. A company like this would be divided based on the geographic location, as the name suggests (Writing, 2012). In my opinion, this structure is best