How does functional grouping typically affect communication within the organization?

Functional grouping organizes employees into teams based on specific functions or roles, such as marketing, finance, and production. This structure can lead to slower communication between different functional areas because each department may become siloed, focusing primarily on their own tasks and objectives. As a result, information sharing across departments may not occur as efficiently, leading to potential misunderstandings or delays in project execution that require input or collaboration from multiple functions.

In contrast to the correct choice, communication across departments is not necessarily enhanced, nor are there fewer managerial levels directly associated with this structure. Additionally, functional grouping does not inherently facilitate direct communication with customers, as the focus is more on internal operations rather than external interactions.