Organizing - I

 According to Chester Barnard, an organization is a

system of consciously coordinated activities or efforts
of two or more persons.

 A formal organization is a system of co-operation in

which people gather together and formally agree to
combine their efforts for a common purpose.

 And the key element is the conscious co-ordination.

 Bedeian and Zamnuto have defined organization as

“Social entities that are goal directed , deliberately
structured activity system with a permeable
boundary.”
The key elements of an organization are: -

1. Social entity

2. Goal directed

3. Deliberately structured activity system

4. Permeable boundary
 Importance of organization:-

 1. It helps achieving objectives.

 2. It establishes clear lines of authority.
 3. It helps establishment of roles, responsibility
and accountability of members.
 4. It helps in delegation of authority.
 5. It helps co-ordination of efforts of members
and in turn creates synergy.
 6. It improves communication and motivates
members.
 7. It helps establishment of effective span of
management and control system.
 Guidelines for effective communication

1. Lines of authority are to be clearly stated.

2. Usually each person is expected to report to one boss

3. Responsibility and authority of each person to be established

clearly.

4. Higher managers are to be made responsible for work of their

subordinates.

5. Authority and responsibility to be delegated as far down the

hierarchy as objectively possible.

 6. Number of levels of authority should be as few
as possible.

 7. Principle of specialization to be applied

wherever possible.

 8. Line function and staff functions to be kept

separately.

 9. Span of control to be reasonable and well

established.

 10. Organization should be simple and flexible.

 Organizational objectives

Mission Objectives Plans

 Mission
Mission tells why does the organization exist and what should it be

doing.

It guides managers, work units and employees throughout the

organization in their operation.

A clear mission statement is expected to be concise, focused,

worthy, imaginative and realistic.

 In addition to Mission statement, modern
organizations also state their ‘vision” statement
which signifies “what the organization wants to
become in future”.

 Whereas goals of an organization are refinements

of its mission. They are open ended statements of
purpose. Though goals are more specific than
mission they address, in general, such key issues
like market share, productivity, profitability etc.

 However, objectives are specific statement about

anticipated end result of an activity.
 Example:-

 1. Mission :- We want to be a market leader in power generation.

 2. Vision :- Our company will made significant contribution in overall

economic development of India.

 3. Goal : - Our goal is to increase our capacity utilization in power

generation.

 4. Objective :- By the year end we will achieve 80% capacity

utilization in our power generation.
 Characteristics of sound objectives

Diagram:

In writing

Time bound

Measurable Sound
objectives
Attainable

Mutually
supportive
 To make objective and realistic the following factors are to
be taken into account:-

 1. Environmental conditions

 2. Economic conditions

 3. Internal resources

 4. Anticipation of future events

 Organization’s overall objectives are further broken

down in departmental / divisional / work group and
individual objectives objectives and a hierarchy of
objectives are created.
 Organizational process

3
1 2 3
Classifying and
Reviewing plans Determining
grouping
and objectives activities
activities

Feedback
4
5
Evaluating Assigning work
results and resources
 Formal vs Informal Organization
Formal Organization Informal Organization

Contains a mechanistic It is a kind of informal group

hierarchical structure, marked which comes into existence due
by position, responsibility,to social interactions and
accountability, authority, unity interpersonal relationships and
of command etc. exists outside formal authority
structure, without any set of
It is a system of well defined rigid rules.
It exists in the shadow of formal
jobs with a prescribed pattern of structure and interpersonal
communication, coordination relationship creates a bond of
and control friendship among the members
which are very strong and can
not be ignored by the formal
organization.
Informal organization is a
powerful instrument in all
organization and influences
success and failure of formal
organization. It also serves as a
 Span of management

Span of management or span of control refers to the

number of people a manager directly manages. The
number of subordinates, one manager can manage
depends on a number of factors such as :-

1. Similarity of functions.
2. Complexity of function
3. Geographical closeness of employees
4. Requirement of direction and coordination
5. Capacity of subordinates
6. Supportive staff of managers