ORGANISING

Organizing is
The identification and classification of required
activities
The grouping of activities necessary to attain
objectives
The assignment of each grouping to a manager with
authority necessary to supervise it
The provision for coordination in both horizontally
and vertically in the organization structure
 Types of Organization
Formal Organization :intentional structure of
roles in formally organized enterprise. The
structure must furnish an environment in which
individual performance contributes to
group goal
Informal Organisation:network of personal and
social relations not established or required by
formal organization but arising spontaneously
as people associate with one another .
Organization Levels and Span of Mgmt

Organization with narrow Spans :

Advantages -
1)Close Supervision
2)Close control
3)Fast communication between subordinate and
superiors
Disadvantages :
1) Superiors tend to get too involved on
subordinates work
2) Many levels of Management
3) High costs due to many levels
4) Excessive distance between lowest level and
top level
• Organization with wide spans
Advantages :
• Superiors are forced to delegate.
• Clear policies are to be made
• Subordinates must be carefully selected
• Disadvantages :
Tendency of overloaded superiors to become
decision bottle necks
Danger of superior’s loss of control
Requires exceptional quality of managers
 Problems in Organizational Levels
• Levels are expensive
• Levels complicate communication
• Levels complicate planning and control
 Steps in Organising
1. Establishing Enterprise objectives
2. Formulating supporting objectives, policies or
plans
3. Identifying analyzing and classifying activites
necessary to accomplish these
4. Grouping these activites in the light of human
and material resources available and the best
way under circumstances of using them .
5.Delegating to the head of each group the
authority necessary to perform the activities
6.Tying the group horizontally and vertically
through authority , information flow and
relationships
Organization Structure –Enterprise
Function

President

FINANCE Marketing Engineering Production

• 2) Departmentation by Geography /territory –
Based on geographical location

President

Western North/Central Southern Eastern

 Customer Departmentation

President

Corporate Agricultural Real estate and Institutional

Banking Banking Mortgage Loans Banking
 Departmentation-Product

President

Instrument Indicator lights Industrial Tools Electronic meter

Division Division Division Division
Matrix Organization
Matrix Organization
• Strategic Business Unit –Set ups in larger
company to ensure that certain product or
product line is handled as though it were an
independent business
• They have their own missions ,distinct from other
SBUs
• Have definable group of competitors
• Mange its resources in key areas
• Have a proper size
 SBU –Structure
CEO
AT CHEMICALS

VP Phosporous

Production Marketing Finance

 Authority
• Authority – It is a right to a position in a
organization to exercise discretion in making
decision affecting others .
• It is basically the power of the positions .
• Empowerment – means that employees ,
managers or teams at all levels in the
organization have the power to make
decisions without asking their superiors
Empowerment means
• 1) Trust
• 2)Sincerity
• 3) is given to competent people
 Staff and Line Concept
Line functions- Those functions that have direct
impact on the accomplishment of the objectives
of the enterprise .
• Eg : Production ,sales etc
Staff functions –Those functions which help the
line persons work more effectively in
accomplishing the objectives
Eg : Plant maintanence , quality control ,advertising
etc
 The Nature of line and Staff
Relationship
Line – It is a relationship in which a superior
exercises direct supervision over a subordinate
Staff – It is a relationship which is advisory .The
func tion of people in staff capacity is to
investigate research and give advise to line
managers
 Benefits of Staff
• The necessity of specialized advises in various
aspects of business is necessary in today’s
competitive environment .
 Limitations of Staff
• Danger of undermining the Line Authority
• Lack of Staff responsibility
• Thinking in a vaccum
• Managerial problem
 Functional Authority
It is a right delegated to an individual or a
department to control specified processes
,practises , policies or other matters relating to
activities undertaken by persons in other
departments .
It is exercised by line and staff departments .
Centralization and Decentralization
• Centralization is the situation of the
organization when the authority is not
delegated
• Decentralization is the situation of the
organization when authority is delegated