The functional configuration has more levels and more horizontal specialization than a simple configuration.
There is a well-defined departmental structure with employees organized into departments, each with a specific function (administration, human resources, finances, production, manufacturing, marketing, sales...). The names of the departments are usually descriptive of their function and fit with the activities of the organization.

A simple organization often evolves into a functional organization when it grows. The functional organization may exhibit more or less complexity depending on the level of formalization of the departments.
In a more complex functional organization, there is a differentiation between staff and line personnel.