BUSSINESS

ORGANISATION
WHAT IS BUSINESS ORGANISATION
Business organization thus consist of the skilled activities
of the businessman with a view to promoting trades,
commerce and industry.

Business organization is an act of grouping activities into

effective co-operation for specific objectives. It is
primarily concerned with the creation and distribution of
utilities for earning profit. Its reveals that it covers all
spheres, of economic functions and it provides a
common link between the various factors of the business
DEFINITION OF BUSINESS ORGANISATION
 L.H. Haney, “Organisation is a harmonious adjustment of
specialised parts for accomplishment of some common
purpose or purposes”.
 Wheeler “Business organization is a concern,company or
enterprise which buys and sells, is owned by one group or
groups of persons and is managed under a specific set of
operating policies.
 Dr A.N Agarwala “Business organization is an act of
bringing into effective cooperation the available resources for
production and distribution of goods with a to earn the profit.
 OBJECTIVES OF BUSINESS
ORGANIZATION
●
Control over various business functions
To help management ●

●
Work divided properly and control center established
co-ordinate administration

●
Duties assigned according to principle of division of labor.
To increase production ●
Effective system encourages every employee to make its
best contribution.

To minimize time and ●

Organized business activities lead to proper and
systematic organization of the availability labor force
effort on scientific lines.

To achieve employee ●
Organization structure will succeeds only if
employees work in team and co-operative manner.
co-operation
TYPES OF BUSINESS

SERVICE BUSINESS

MERCHANDISING BUSINESS

MANUFACTURING BUSINESS

HYBRID BUSINESS
FORMS OF BUSINESS ORGNIZATION

SOLE PROPRIETORSHIP

PARTERNSHIP

COOPERATION

LIMITED LIABILITY
COMPANY

COOPERATIVE
COOPERATION
Cooperation is a business organization that has a
separate legal personality from its owners. Ownership in
a stock cooperation is presented by shares of stock. The
owners enjoy limited liability but have limited
investment in the company’s operations. The board of
directors n elected group from the stockholders, controls
the activities of the cooperation.
LIMITED LIABILITY COMPANY
COMMON  FEATURES OF BUSINESS ORGANIZATIONS

1. Structure An organization is a structure which is used to arm people with specific

relations and authority. Within the structure, people work to achieve the desired
objectives.   It is the skeleton around which an organization is built. Structure has a
formal character.   It is an arrangement and formulated for grouping tasks, jobs,
delegating authority, allocating responsibility and accountability, along with the
number of persons involved in the managerial hierarchy and at the shop-floor level.  
It helps management tasks to be done easily and smoothly through the identification
of different tasks, grouping together of similar activities and assigning tasks to
individuals.   The allocation, supervision and functions are essentially designed
under organizational structure.   The formal relationship among persons working at
different levels, well-defined authority and responsibility and individual actions and
interactions are the bases of the structure of an organization. The structure
concentrates on the division of work, specialization, coordination of work, job
design, grouping of jobs and work allocation. 
2. Process An organization is an operation within the structure.   It is just like a
body structure where the functions of each organ of the body are defined and
specifically performed.   An organization like the human body is an ongoing
process of structure.   It is a process of managerial function.   It aims at organizing
work, arranging people and systems, developing technology, designing
communication and providing an organizational climate. The organization is
concerned with the organizing process, including the decision of the course of
action, division of various activities, assignment of tasks to proper persons,
delegation of authority and responsibility, coordination of the various tasks and the
decisions of the management. 
3. Relationships The organization sets up certain
forms of relationship to enable workers to
perform their jobs harmoniously. Relationships
are defined and designed as per the needs of the
organization. Functional relations are developed
to perform the activities of the organization. An
established relationship is useful for training and
development of human resources. 
4. Authority and Responsibility The structural relationship
 becomes effective with 
the allocation of authority and responsibility.   Each cadre is
specifically assigned the authority and responsibility for the tasks
he has to perform.   Members of the cadre must know the rights
and powers to be exercised to perform their duties.   The authority
and responsibility is ultimately vested with the top management.  
Since the Chief Executive cannot perform all the jobs, he has to
decide what part of his work will be entrusted to his subordinates
and what part of the job will be retained by him. Organizational
structure has well-defined authority and responsibility, explicit or
implicit. 
5. Performance The organization, by its performance, tries to achieve
synergistic results, which infers that the whole organization is greater
than the sum of its parts. The organizational structure and process are
designed to 
achieve the goals and objectives through effective performance which is
possible with human resource development.   Organization development
programs maximize work motivations and creativity.   Job enrichment,
job enlargement and job satisfaction also come under 
organizational performance.   Specialization in particular is the core of an
organization.   It helps in the effective performance of the job.  
Discipline, unity of command, giving direction, scalar chain 
decentralization and coordination need to be properly exercised to
achieve good job performance in an organization
6. Behavior of Groups An organization is a composition of people.
The success of an organization depends upon the behavior of the
people and the group.  Individual groups and structures are the
bases of group behavior. Relationships on a person-to-person
level and subordinate-to-subordinate as well as with the superior
are established in a group.   Formal and informal organization
helps in developing proper behavior of a group. Group behavior
has given birth to team work which has been accepted as the most
effective form of organization.   Team spirit, team performance,
team rewards and team motivation have achieved new dimensions
in big organizations in the beginning of the twenty-first century. 
IMPORTANCE OF BUSINESS ORGANISATION
Business organization are highly important for a country. There
organizations have economic as well as social importance. some of the
important points highlighting are discussed as follow

Entrepreneu
r/ employer
SOCIET
Y

EMPLO
YEE

GOVER
NMENT
CUSTO
MER
Thank
you