UNIT 3 : ORGANISING Meaning of Organizing: The term organizing can be used in different senses.

It can be used as a group of persons working together or as a structure of relationships or as a process of management. When it is used to refer to a group of persons working together, it means a concern, an undertaking, or an enterprise. When it is used to refer as a structure of relationships. It means the structural relationships among the positions & jobs & persons (i.e., the framework of responsibility & authority) through which the enterprise functions and it is called organization structure. When it is used to refer to a process it means a management function or managerial activity. In this case, it can also be called organizing. Though the term organising can be used in any of the senses, it is mostly used to refer to a process or an act. This is the dynamic concept of the term organizing. Definition In the words of Theo Haimann, organizing is the process of defining and grouping the activities of the enterprise and establishing authority relationships among them. According to Koontz and ODonell , organizing involves grouping of activities necessary to accomplish goals and plans, the assignment of these activities to appropriate departments and the provision for authority, delegation and co-ordination.

Nature / Characteristics / Features of organization 1) Organizing is a management process i.e., managerial function. 2) Organization is concerned with groups of people. An organization cannot be constituted by a single person. 3) Organization is concerned with identification and grouping of activities into logical pattern so as to secure homogenous. 4) Division of labour or work is the basis of organization. 5) Integration or co-ordination of the various activities of the enterprise.

6) An organization structure has no meaning unless it can contribute to the accomplishment of the common objectives. Therefore, accomplishment of goal is another important feature of organization. 7) Establishment of authority responsibility relationship. PURPOSE OR OBJECTIVES OF ORGANISATION: 1) To facilitate efficient administration by classifying and grouping the activities and assigning the group of activities to different departments and providing the requisite authority to department manager to carry out their respective function. 2) To help the management to control over the various activities of the enterprise. 3) To act as the means to solve business problems and achieve the goals of the enterprise. 4) To facilitate optimum use of resources of the undertaking. 5) To facilitate co-ordination and communication among the departments and individuals. 6) To encourage initiative and creativity among the managers and subordinates. Importance or Advantages of organization Organization facilitates efficient administration. Organization helps the management in performing other management functions. Organization contribute to the growth and diversification of the enterprise, through proper selection, training, placement of personnel, assignment of responsibility. Delegation of authority and control of activities. Sound organization facilitates stability of the enterprise by ensuring delegation of authority, two-way communication, co-operation, effective leadership, employee morale and flexibility to adjust to changes in the conditions. Sound organization ensures the most effective use of physical resources of the enterprise such as plant, materials etc. Organisaton facilitates optimum use of human resources through scientific selection, training, placement of workers and through effective motivation of the personnel. Organization encourages division of labour and specialization and thereby ensures increased efficiency and productivity. Organization avoids delay and duplication of activities by ensuring well defined responsibilities and authority. Organization encourages co-ordination.

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Steps/Process of Organisation There are a number of steps involved in the process of organization. Some of the important steps are as follows: 1) Determination of objectives: The first step in the process of organization is determination of objectives. Organization structure is built on the basis of the objectives of the enterprise. That means, the structure of the organization can be determined by the management only after knowing the objectives to be accomplished through the organization. The objectives have to be set in general and in particular according to the requirements of each department. This step helps the management not only in framing the organization structure but also in achieving the enterprise objectives with minimum cost and efforts. 2) Identification of activities: The second step involved in the process of organization is the identification of the activities required to be carried out to attain the objectives of the enterprise. That is, the total work of the concern has to be divided into essential activities or major functions such as purchasing of materials, production, marketing, financing, personnel etc. 3) Grouping of activities: The third step in the process of organization is the grouping of activities into divisions and departments and the sub division of departmental activities into sections on the basis of relatedness and similarity. For instance, the activities of an industrial undertaking may be grouped into production, marketing, financing and personnel departments and the activities of each of these departments may be sub-divided into divisions , say the activities of marketing department may be sub- divided into market research, advertising etc. 4) Defining the duties to be performed by various departments: The next step involved in the process of organization is to define the duties to be performed by the various departments. The duties and responsibilities of every department must be clearly defined so that there may not be any over-lapping of functions. 5) Appointment of personnel for various jobs: After defining the duties and responsibilities of the various departments, the next step in the process of organization is to appoint suitable and well-qualified persons for the various jobs in relation to the requirements of the jobs. 6) Assignment of duties to the personnel: The next step involved in the process of organization is the assignment of duties to different personnel on the basis of their

specialization, skill, experience and ability, and defining of the responsibility and accountability of each of the personnel. 7) Delegation of authority: The next step in the process of organization is the delegation of sufficient authority to the subordinates to enable them to carry out their duties efficiently. 8) Provision of adequate physical facilities: The next step in the process of organization is the provision of adequate physical facilities to the personnel to enable them to discharge their duties and responsibilities efficiently. 9) Establishment of authority relationship: The last step in the process of organization is the establishment of authority relationship. The organizational relationship among the different groups and individuals must be clearly established. Establishment of authority relationship involves taking decisions as to superior subordinate relationship, who will act under whom, who will be his subordinates, his span of control, his position in the organization etc.

Principles of sound organization In the words of E.F.L.Brech if there is to be a systematic approach to the formation of an organization structure, there ought to be a body of accepted principles. This statement emphasizes the need for principles of organization. A sound and efficient organization structure can be built only on certain principles. The principles on which a sound organization is built are called Principles of sound organization. Every manager of the enterprise should have knowledge of the principles of organization and must apply them efficiently. There are many principles of sound organization. The main principles are: 1) Principles of objective: The principle of objective stresses the need for setting the objectives of the enterprise. The setting of the objectives of the enterprise is necessary because the formulation of the organization structure is very much influenced by the objectives of the enterprise. The objectives of the enterprise must be stated as clearly as possible. The objectives must be set in general and in particular according to the requirements of each department. 2) Principles of unity of objectives: The principle of unity of objectives implies that every part of the organization and the organization as a whole should be geared to

the basic objectives of the enterprise. The other words, every essential activity of the enterprise must contribute to the main objectives of the enterprise. 3) Principles of division of work and specialization: The principle of division of work and specialization requires that the organization structure should be built in such a way that the activities of the enterprise are divided according to different functions and those functions and those functions are assigned to different persons according to the specialization. 4) Principle of functional definition: The principle of functional definition implies that the functions, duties and responsibilities of the different departments and positions in the organization, their authorities and their relationships with other departments and positions must be clearly defined. 5) Principle of balance of vario