It is grouping of activities on the basis of similarities of functions.
The nature of activities performed by different organisations is different
Activities carried by a manufacturing concern are production,finance,personnel and sales.
For a trader, the major activities are buying and selling.A bank performs the activities of borrowing ang lending.The major functional departments further have derivative departments.
Production departments, for example, has departments to handle purchasing, production planning and control, manufacturing etc.
It is grouping of activities on the basis of similarities of functions.The nature of activities performed by different organisations is different Activities carried by a manufacturing concern are production,finance,personnel and sales.For a trader, the major activities are buying and selling.A bank performs the activities of borrowing ang lending.The major functional departments further have derivative departments.Production departments, for example, has departments to handle purchasing, production planning and control, manufacturing etc.
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