Organising

(How to do)
 The term organisation is used in many ways.
organisation as an activity refers to an
important function of management use The
term organisation is used to refer a group of
people united & working for a common
purpose. It also refers to the structure of a
business unit.
In other words it may be said that
the term organisation is used both in
structural & functional sense .
as a structure it refers to various levels
created, maintained & operated to achieve the
goals determined.
As a function it refers to establish relationship
between activities & authority pertaining to an
enterprise.
 Meaning

Process of arranging people and physical

resources into a structured grouping to carry
out plans and accomplish organisation
objectives
 Definition:
According to Koontz & O'Donnell
Organisation involves the grouping of
activities necessary to accomplish goals &
plans, The assignment of these activities to
appropriate departments & the provision for
authority delegation & co-ordination
 According to Theo Haimann
Organising is the process of defining
& grouping the activities of
enterprise & establish authority
relationship among them
 Principles of organisation
In order to develop a sound & efficient organisation
structure .There is need to follow certain principles:
1. Principle of objective
2. Principle of specialisation
3. Principle of co-ordination
4. Principle of Authority
5. Principle of responsibility
6. Principle of definiteness
7. Principle of simplicity
8. Principle of correspondence
9. Principle of span of control
10. Principle of unity of command
11. Principle of balance
12. Principle of continuity
1. Principle of objective : Organisation
without objective is meaningless. It
should be designed for a specific
purpose relating to the entire enterprise
including its various departments .The
efficiency & effectiveness of
organisation depends on its objectives,
Hence, it is need to state the objectives
clearly
2.Principle of Specialisation: The functions of
very member of an organisation should be
confined, as far as possible, to perform single
activity. No individual in an organisation should
be unnecessarily loaded with diverse duties
which are not related to his innate abilities &
specialized knowledge. The efficiency of
employees would be maximum when they are
entrusted with a job suited to their aptitude
,ability, education, training
3.Principle of co-ordination : To have
smooth flow of work & to have greatest
efficiency ,there should be built in
procedure for coordinating the roles of
various departments.
4.Principle of Authority : the authority is
the tool by which a manager is able to
accomplish the desired objectives.
Hence, the authority of each manger
must be clearly defined. Further the
authority should be equal to
responsibility.
5.Principle of responsibility : Principle of
responsibility implies The superior should be
held responsible for the acts of his subordinates
.No superior should be allowed to avoid
responsibility by delegating authority to his
subordinates.
6. Principle of definiteness: The scope of authority
& responsibility should be defined in definite
terms .There should not be any scope for
misinterpretation of the scope of authority &
responsibility .The duties of each position & the
responsibility expected & the relationships with
other positions should be in clear terms.
7. Principle of simplicity :The organisation
structure be as simple as possible & the
organisation levels should be .as far as
possible, be minimum. A large number of
levels of organisation means difficulty of
effective communication & coordination.
8. Principle of correspondence: Each position
should have authority & at the same time
should have corresponding responsibility
.Responsibility without corresponding
authority cannot be discharged effectively, in
the same way authority without equalent
responsibility is liable to be misused.
9.Principle of span of control : Principle of
span of control stresses that the number
of subordinates that a superior controls
should be kept at minimum possible
.Direct communication can be established
if a person controls a few persons.

10. Principle of unity of command: The

principle of unity of command stresses
that every employee should receive
orders from only one superior .Dual
command is always a source of conflict.
11.Principle of balance : It is very essential
to strike a balance at all levels of an
organisation as far as authority &
responsibility ,Span of control ,Work
distribution etc are concerned. All the
units should be so properly balanced
that no single unit should feel that it is
very important ,neglected or
overburdened.
12. Principle of continuity : Organisations
come into being with the objective of
doing business for a long period of time
.Changes that occur in the environment
may force the organisation to undergo
change. Hence ,organisation should be
flexible to incorporate the change
whenever it is necessary.
 Organisation structure
Meaning:
The formal pattern of interactions &
coordination designed by management to link
the task of individuals and groups in achieving
organisational goals.
 Organizational
structure
Organizational Structure defines how
tasks are allocated, who reports to whom,
and the formal coordinating mechanisms
and interaction patterns that will be
followed.
 Types of organizational
Structures
Traditional structures
Matrix structure

Centralization

Decentralization

Departmentalization
 1.Traditional Structures
Traditional organizational
structures focus on the
functions, or departments,
within an organization, closely
following the organization's
customs and bureaucratic
procedures. These structures
have clearly defined lines of
authority for all levels of
management.
 Two traditional structures are:

line
line-and-staff
 Line Structure
The line structure is defined by its
clear chain of command, with
final approval on decisions
affecting the operations of the
company still coming from the top
down. Because the line structure
is most often used in small
organizations
such as small accounting offices
and law firms, hair salons, and
Line Structure
 Line-And-Staff Structure
While the line structure would not be
appropriate for larger companies, the
line-and-staff structure is applicable
because it helps to identify a set of
guidelines for the people directly
involved in completing the
organization's work.
This type of structure combines the flow
of information from the line structure
with the staff departments.
Line-And-Staff Structure
 2.Matrix Structure
A variation of the line-and-staff
organizational structure is the
matrix structure. In today's
workplace, employees are hired
into a functional department (a
department that performs a
specific type of work, such as
marketing, finance, accounting,
and human resource) but may
find themselves working on
projects managed by members of
another department.
.
 Organizations arranged according to
project are referred to as matrix
organizations.
"Workers are accountable to two
supervisorsone functional manger in
the department where the employee
regularly works and one special project
manager who uses the employee's
services for a varying period of time"
 Since employees report to two separate managers,
this type of organizational structure is difficult to
manageespecially because of conflicting roles and
shared authority.
 3.Centralisation
Centralisation refers to the retention of control
by the top management in the area of decision-
making.
Acc to Allen Centralisation is the systematic
and consistent reservation of authority at
central points within an organisation
Centralization
 4. Decentralisation
Decentralisation applies to a systematic
delegation of authority in an organisation
wide context.
Decentralisation is granting of decision
making by management to lower level.
Decentralization
 Advantages of Decentralisation
Decisions can be taken by lower level managers
Facilitates fast decision making
Decisions can be quickly adapted
Increases self-confidence and motivates employees
Highly effective in large complex organisation.
Frees the top management from decisions related to
day to-day operation.
 Disadvantages of Decentralisation
Coordination of decentralized units is very
difficult.
Policies can not be applied uniformly across
all units
Misunderstanding between top managers and
unit managers can lead to conflict.
The success of unit will depend on efficiency
and capability of its head.
 5.Departmentalization
Organizations can be divided into
various departments, or units,
with individuals who specialize
in a given area. Having each unit
perform specialized jobs is
known as departmentalization.
Departmentalization
Departmentalization is done according to
five major categories :
(1) product, which requires each
department to be responsible for the
product being manufactured;
(2) geographic, which divides the
organization based on the location of
stores and offices;
(3) customer, which separates
departments by customer
(4) functional, which breaks departments
into specialty areas; and
(5) process, which creates departments
responsible for various steps in the
production process
 Types of Organisation
Formal Organisation
Informal Organisation
 Formal Organisation
A formal Organisation means the
intentional structure of roles in a formally
organized enterprise.
It is a system of well defined jobs ,each
bearing a definite measure of authority ,
responsibility & Accountability.
 Informal Organisation
An informal organisation is a network of
personal and social relations not
established or required by formal
organisation but arising spontaneously
as people associate with one another.
 Formal VS Informal Organisation
Formal informal
Officially formed Unofficial
Emphasis on position Emphasis on people and
and Authority relationship
Power is delegated Power is given by group
Small in size
Large in size
 Delegation Of authority.
Job of manager is to get the work
done by other. this is possible when
he delegates certain tasks or duties
with sufficient authority.
Delegation is necessary for an
organisation to exist. it is impossible
for a single person to do all tasks for
accomplishing group purpose.
 Meaning
The delegation of authority is the
right to act, to make decisions, to
requisition and to perform other
tasks in order to fulfill job
responsibilities
 Art of Delegation

Most failures in effective delegation

occurs not because managers do not
understand the nature and principle of
delegation but because they are unable to
apply effectively.
Factors effecting delegation of authority
are:
 The delegators aspect
Manager may not delegate the authority
due to following reasons.
Love of authority
Fear of subordinates advancement
Fear of exposure
Attitude towards subordinates
 The delegant,s aspect
Fear of criticism
Lack of information and resources
Lack of self confidence
Absence of rewards and incentives
 Guidelines for overcoming weak
delegation
Define assignment and delegate in light of
results expected.
Select the person in light of the job done
Maintain open lines of communication
Establish control
Reward effective delegation and
successful assumption of authority
Span Of
Control
 Meaning
Span Of control refers to the number of
subordinates a superior can supervise
effectively and efficiently.
 Definition
According to David The span of management
or span of control is the number of
subordinates who report directly to a specific
manager
 Factors effecting Span of control
The principle of span of management states
there is a limit to the number of subordinates a
manager can effectively supervise ,but the
exact number will depend on the impact of
following factors.
 Trained Subordinates.
Clarity of delegation of authority
Clarity of plans
Use of objective standards
Rate of change
Communication Techniques
Amount of personal contact needed
 Organizing Environment for
Entreprenuering
Entrepreneurship generally refers to managing small
,independent businesses.
But some management theorist have applied this term
to large organizations also to manage performing
entrepreneurial functions through which they bring
about innovative changes in the organisation.
Peter F. Drucker suggests that instead of seeking
entrepreneurial persons ,organisation should show
commitment to continuous innovation ,which is a
specific activity of entrepreures.
 As entrepreneurs, managers must try to
capitalize on the available opportunities
and improve the organization's position
in the industry.
Nature or Characteristics:
1. Main feature of entrepreneurial
organisation is the effective
implementation of creative ideas. by
doing so organisation provides various
avenues for its employees to explore .
2.For an organisation to remain profitable in these
days of fierce competition, innovation and
continuous improvement is a must.
Entrepreneurial organisation keep improving
efficient ways of doing the same thing.
3.Entrprenurial organisation anticipate change and
effectively bring about change in an
organisation process.
4.Entrprenurial organisation are able to create new
jobs as they have the capacity to develop new
products and services.
5.An entrepreneurial organisation consist of
networked teams which leads to
knowledge sharing .
6.Entrprenurial organisation offer greater
service to customer at an affordable.