NATURE OF

ORGANIZING
Learning Objectives
 Explain the Concept of Organizing
 Describe the importance of Organizing
 Explain the Element of Organizing
 Process of Organizing
 Explain the meaning, advantages and
disadvantages of formal and informal
Organization
 Distinguish between formal and informal
Organization

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What is Organizing
 The grouping of activities necessary for attaining
objective.

 The process of creating an organization’s

Structure .

 A Process that initiates implementation of plans by

clarifying jobs and working relationship and effectively
deploying resources for attainment of identified and
desired results

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Definition
Organizing is the process of identifying and
grouping the work to be performed, defining
and delegating responsibility and authority,
and establishing relationships for the
purpose of enabling people to work most
effectively together in accomplishing
objectives.
Louis Allen

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Importance of Organizing
 Benefits of specialization
 Clarity in working relationships
 Optimum utilization of resources
 Adaptation to change
 Development of personnel
 Expansion and growth

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Purposes of Organizing
 Divide work to be done into specific jobs and
Departments
 Assign tasks and responsibilities associated with
individual
 Coordinates diverse organizational tasks.
 Clusters job in to Units.
 Establish relationship among individuals , group , and
departments .
 Allocates and deploys organizational resources .

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Elements in Organizing process
 Work Specialization
 Departmentalization
 Chain of command
 Centralization and Decentralization
 Formalization
 Span of Control

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Departmentalization
 The Basis by which jobs are grouped together
 Five common form of Departmentalization
Functional
Geographical
Product
Process
Customer

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Principle of the Span of management

There is a limit to the number of persons

an individual can effectively manage .

 Organization with Narrow Span

 Organization with Wide Span

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Organization with Narrow Span
A

B C D

E F G H I J

K L

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Advantage
 Close supervision
 Close control
 Fast communication
between subordinates
and superiors
Disadvantage
 Subordinates tend to get
involved in Subordinates
Work
 Many Levels of
Management
 High Costs due to many
levels
 Excessive distance
between lowest level and
top level

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Organization with Wide Span

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 Advantages
 Superior are forces to
delegate
 Clear polices must be
made
 Subordinate must be
carefully selected
Disadvantage
 Tendency of
overloaded
 Danger of superiors
loss of control
 Requires exceptional
quality of Managers

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Organizing Process
 Identifying, analyzing and classifying the activities
necessary to accomplish the objectives
 Grouping these activities in the light of human and
material resources available and the best way under
the circumstances , of using them
 Delegation of authority (Assignment of duties )
 Horizontal and vertical coordination of authority and
information relationship

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 Organizing Process
Feasibility studies and feedback

IDENTIFICATION GROUPING HORIZONTAL

AND OF ACTIVITIES IN AND VERTICAL
CLASSIFICATION THE LIGHT OF DELEGATION COORDINATION OF
OF RESOURCES AND OF AUTHORITY AUTHORITY AND
REQUIREDS SITUATIONS INFORMATION
ACTIVITIES RELATIONSHIP

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Common Errors In Organizing
 Unnecessary Lengthy Chain of Command
 Unsatisfactory Work Division
 Lack of parity between the Authority and
Responsibility
 Lack of Coordination and Control
 Failure to Classify Relationship
 Confusion of authority and relationship with
Informal Organization

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Formal and Informal

Organization
Formal Organization
 The Formal Organization is a system of
well-defined jobs, each bearing a definite
measure of authority, responsibility and
accountability.
Louis Allen
 Formal Organization is a system of
consciously coordinated activities of two or
more persons toward a common objective.
Chester Barnard

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Features
 It is deliberately designed by the top management
 It places more emphasis on work to be performed than
interpersonal relationships among the employees.
 It specifies the relationships among various job positions and
the nature of their inter-relationship.
 It lays down rules and procedures essential for achievement of
objective
 Efforts of various departments are coordinated, interlinked and
integrated through the formal organisation.

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Formal Organizations

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Features
 It is deliberately designed by the top management
 It places more emphasis on work to be performed
than interpersonal relationships among the
employees.
 It specifies the relationships among various job
positions and the nature of their inter-relationship.
 It lays down rules and procedures essential for
achievement of objective
 Efforts of various departments are coordinated,
interlinked and integrated through the formal
organisation.

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Advantages
 Easier to fix Responsibility
 No ambiguity in the role . This also helps
in avoiding duplication of effort.
 Behavior of Employee fairly predicted
 Unity of command through an established
chain of command
 Stability to the organization

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Limitations
 The formal communication may lead to procedural
delays
 Do not provide adequate recognition to creative talent
 More emphasis on Structure and Work, difficult to
understand all human relationships in an enterprise as
it places

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Informal Organization
 An Informal organization is an aggregate of
interpersonal relationships without any
conscious purpose but which may contribute to
joint results.
Chester Barnard
 Informal organization is a network of

interpersonal relationship that arise when people

associate with one another .
Keith Davis
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 Features
 Originates from within the formal organisation as a
result of personal interaction among employees.
 The standards of behavior evolve from group norms.
 Independent channels of communication without
specified direction of flow of information are
developed by group members.
 Emerges spontaneously and is not deliberately
created by the management.

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 A

B C C

D E F G H I

J K L M N 0 P Q R T U V

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 Chess group

Cricket lovers Bowling Team

Morning coffeee regulars

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Advantages:
 It helps to fulfill the social needs .
 Sense of belongingness in the organisation
 Faster spread of information as well as quick
feedback.
 It contributes towards fulfillment of organizational
objectives. For example, employees reactions
towards plans and policies can be tested
through the informal network.

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Disadvantages:
 It spreads rumors. This may work against the interest
of the formal organisation.
 The management may not be successful in
implementing changes if the informal organisation
opposes them. Such resistance to change may delay
or restrict growth.
 It pressurizes members to conform to group
expectations.

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Formal and Informal organisation: A
Comparative view
 Meaning
 Origin
 Authority
 Behavior
 Flow of Communication
 Nature
 Leadership

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REFERENCES
 Koontz,O’ Donnel & Weihrich
Management:A Global and Enterpreneurial
Perspective
 Stephen P. Robbins and Mary Coulter
:Management,Pearson Education

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 Any Query ?

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 THANK
YOU
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