In a functional structure, the functions become formalized not only on the organization chart, but also in the mind-sets of people.

In a functional structure, each function becomes a formal department or unit, and this organizational structure is reflected not only on the organization chart but also in the behaviors and attitudes of people working in those functions. They tend to identify more with their department or function rather than the overall organization, and may prioritize the goals and interests of their function over those of the organization as a whole. This can lead to silos and difficulty in cross-functional collaboration.