organisation in Management

8/9/2019 organisation in Management

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WELCOMEWELCOME UUALLALL


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INTRODUCTIONINTRODUCTION

Organization involves division

of work among people whose

efforts must be co-ordinate to

achieve specific objectives


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DEFINITION OF ORGANISATIONDEFINITION OF ORGANISATION

Mc Ferland has defined organization as,"an identifiable group of peoplecontributing

their efforts towards the attainment ofgoals".

Mooney and Railey, "Organization is the

form of every human association forthe attainment of a common purpose.


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ORGANISATION AS A PROCESSORGANISATION AS A PROCESS

Organization is the process of establishing

relationship among the members of the

enterprise. The relationships are createdin terms of authority and responsibility.


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The variousThe various

steps involved in this processsteps involved in this process

Determination of Objectives

Enumeration of Objectives

Classification of Activities Assignment of Duties

Delegation of Authority


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Determination of ObjectivesDetermination of Objectives

It is the first step in building up an

organization. Organization is always

related to certain objectives.

Determination of objectives will consist

in deciding as to why the proposed

organization

is to be set up


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Enumeration of ObjectivesEnumeration of Objectives

The first step in organizing group effort

is the division of the total job into

essential activities. Each job should be

properly classified and grouped. For example, the work of an industrial

concern may be divided into the following

major functions production, financing,

personnel, sales, purchase, etc.


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Classification of ActivitiesClassification of Activities

Activities according to similarities and

common purposes and functions and

taking the human and material resourcesinto account. Then, closely related and

similar activities are grouped into divisions

and departments and the departmental

activities are further divided into sections.


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Assignment of DutiesAssignment of Duties

Here, specific job assignments are made

to different subordinates for ensuring a

certainty of work performance. Eachindividual should be given a specific job to

do according to his ability and made

responsible for that.


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Delegation of AuthorityDelegation of Authority

Authority without responsibility is a

dangerous thing and similarly responsibility

without authority is an empty vessel.Everybody should clearly know to whom he

is accountable; corresponding to the

responsibility authority is delegated to the

subordinates for enabling them to show work

performance.


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ORGANISATION STRUCTUREORGANISATION STRUCTURE

An organization structure shows the

authority and responsibility relationships

between the various positions in theorganization by showing who reports to

whom. Organization involves establishing

an appropriate structure for the goal

seeking activities. It is an establishedpattern of relationship among the

components of the organization.


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PRINCIPLES OF ORGANISATIONPRINCIPLES OF ORGANISATION

Consideration of unity of objectives

Specialization

Co-ordination Clear unbroken line of Authority:

Responsibility

Efficiency


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PRINCIPLES OF ORGANISATIONPRINCIPLES OF ORGANISATION

Delegation

Unity of Command:

Span of Management: Communication

Flexibility


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FORMAL AND INFORMAL ORGANISATIONFORMAL AND INFORMAL ORGANISATION

Formal Organization

Informal Organization

************************* Formal Organization:

-"a system of consciously coordinated activities

or forces of two or more persons. It refers to the

structure of well-defined jobs, each bearing a

definite measure of authority, responsibility and

accountability."


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Characteristic Features of formalCharacteristic Features of formal

organizationorganization

laid down by the top management

Formal organization prescribes the

relationships concentrates on the jobs to be

performed

individuals are fitted into jobs

is bound by rules, regulations and

procedures.


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authority, responsibility and

accountability of each level are clearly

defined.

division of labor and specialization to

achieve efficiency in operations. coordination proceeds according to the

prescribed pattern.


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Advantages of formalAdvantages of formal


on the jobs to be performed.

everybody responsible for a given task.

bound by rules, regulations andprocedures.

people of the organization to work together


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Disadvantages or criticisms of formalDisadvantages or criticisms of formal


does not consider the goals of the

individuals.

bound by rigid rules, regulations andprocedures. This makes the achievement

of goals difficult.


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Informal OrganizationInformal Organization

an informal organization is an organization

which is not established by any formal

authority, but arises from the personal and

social relations of the people.


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Characteristics features of informalCharacteristics features of informal


It is unplanned

reflect human relationships.

It is not based on rules, Informal organizations are based on

common taste, problem, language,


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Benefits of Informal organizationBenefits of Informal organization

it more effective.

Many things which cannot be achieved throughformal organization can be achieved

It provides social satisfaction to group members. Job satisfaction.

the best means of employee communication.

It serves as an agency for social control of

human behavior.


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Differences Between Formal andDifferences Between Formal and

Informal OrganizationInformal Organization

Formal Organization:

Formal organization is established with the

explicit aim of achieving well-defined goals.

Informal Organization:

Informal organization springs on its own. Its

goals are ill defined and Intangible.


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is bound together by authorityrelationships among members.


is characterized by a generalized sort ofpower relationships.


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Formal organization recognizes certaintasks and activities


Informal organization does not have anywell-defined tasks.


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Formal Organization

The roles and relationships of people informal organization are impersonally

defined

Informal Organization In informal organization the relationships

among people are interpersonal.


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Formal Organization

In formal organization, much emphasis isplaced on efficiency, discipline, conformity,

consistency and control.

Informal Organization

is characterized by relative freedom,

spontaneity, homeliness and warmth.


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Formal Organization

the social and psychological needs andinterests of members of the organization

get little attention.

Informal Organization the socio psychological needs, interests

and aspirations of members get priority.


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IMPORTANCE OF ORGANISATION

Facilitates Administration

Facilitates Growth and Diversification

Provides for Optimum use ofTechnological Improvements

Encourages Human use of Human

Beings

Stimulates Creativity


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IMPORTANCE OF ORGANISATION

(contd)

Facilitates stability of the organisation

Reduces Employee Turnover

Reduces Duplication of Activities Fosters Coordination


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Facilitates Administration

A properly designed and balanced

organization facilitates both management

and operation of the enterprise. It

increases management's efficiency andpromptness, avoids delay and duplication

of work and motivates the employee to

perform their job efficiently.


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Facilitates Growth and Diversification

The organization structure should providefor expansion and diversification of the

enterprise otherwise, the enterprise will

find itself in a serious administrative crisis.Provides for Optimum use of Technological Improvements

A sound organization structure facilitates

the optimum use of technological

improvements like computer systems etc.


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Encourages Human use of Human Beings

A sound organization provides for efficientselection, training and development of

staff, job rotation and job enlargement.

The organization structure can profoundly

affect the people of the company. Properorganization facilitates the intensive use of

human capital.


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Stimulates Creativity

organization provides sufficient freedom to themanagers and encourages their initiative,

independent thinking and creativity.

Facilitates stability of the organization

By ensuring delegation of authority, two-waycommunication, co-operation, effective

leadership, employee morale and flexibility to

adjust to changes in the conditions, a sound

organization facilitates stability of the organization.


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Reduces Employee Turnover

Organization increases employeesatisfaction, ensures better relationsbetween the management and theworkers, and thereby reduces employee

turnover. Reduces Duplication of Activities

Organisation avoids delay and duplicationof activities and consequent confusion by

ensuring well-defined responsibilities andauthority.


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Fosters Coordination

By providing the framework for holdingtogether the various functions in an orderly

pattern, organization fosters co-ordination.


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ORGANISATION CHARTS AND MANUALS

Organization chart: The pattern of network

of relations between the various positions

in an organization as well as between the

persons who hold those positions is

referred to as "Organization chart".

In the word ofJBatty, "An organization

chart is a diagrammatic representation ofthe framework or structure of an organization."


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The

organization chart has the following characteristics:

It is a diagrammatical presentation

l It shows principal lines of authority in the

organizationIt shows the interplay of various functions

and relationships

l It indicates the channels of communication.


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Advantages of Organization Chart

It gives a clear picture of the organizationstructure.

It shows at a glance the lines of authorityand responsibility.

to avoid misunderstanding of jurisdictionalproblems

outsiders can easily know the persons

whom they have to approach in connection with

their work.


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to avoid overlapping and duplication of

authority and secure unity of command. what extra training is required for

promotion to a higher position.


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Types of Organization Chart

An organization chart can be drawn in

different forms. They are:

Top-to-down chart or vertical chart

Left-to-right chart orHorizontal chart

Circular chart.


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Top-to-down chart or vertical chart:

Most organizations use this type of chart

which presents the different levels of

organization in the form of a pyramid with

senior executive at the top of the chart and

successive levels of management

depicted vertically below that


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Left-to-right or Horizontal Chart:

Horizontal charts which read from left toright are

occasionally used. The pyramid lies

horizontally instead of standing in thevertical position.

The line of command proceeds horizontallyfrom left to right showing top level at theleft and each successive level extending tothe right.


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Circular Chart:

In this chart, top positions are located in

the centre of the concentric circle.

Positions of successive echelons extend in

all directions outward from the centre.

Positions of equal status lie at the same

distance from the centre on the same

concentric circle


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Meaning of Organization Manual

an organization may prepare a Manual or

Management Guide. Manual sets down in

the form of a book or booklet all the details

of the organization,.


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Good organization manual has the following

contents.

1.Nature of the enterprise

2. Objectives of the enterprise

3. Policies of the management4. Job Descriptions

5. Duties and responsibilities of various

personnel6. Instructions relating to the performance of

standard as well as non-standard jobs.


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Types of Manuals

Policy Manuals:

Operations Manual:

Organization Manual: DepartmentalPractice Manual:

Rules and Regulations Manual:


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Policy Manuals:Policy Manuals:

It describes the overall limitations within

which activities are to take place and thus

reveals the broad courses of managerial

action likely to take place under certain

conditions.


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Operations Manual:Operations Manual:

It is prepared to inform the employees of

established methods, procedures and

standards of doing the various kinds of

work.

DepartmentalPractice Manual:

It deals in detail with the internal policies,

organization and procedures of one

department.


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Advantages of Manuals

1. It contains in writing all-important decisions

relating to internal organization of the

enterprise.

2. It avoids conflicts and overlapping of authority.

3. It enables new employees to know the variousprocedure and practice in the shortest

possible time.

4. It enables quick decisions.

5. It contains rules and regulations which

employees must follow.


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Disadvantages of Manual

1. The preparation of manual is costly andtime consuming and process.

2. Manuals leave little scope of individual's

initiative and direction.

3. Manuals bring rigidity to the

organization.

4. Manuals may put on record those

relationships which no one would like tosee exposed.

organisation in Management

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