ORGANIZING

BY : DARSHAN .G RISHIKESH.D SANKET .Y MARTIN.C

DEFINATION OF ORGANIZING
Definitions have been stated by authors such as: Louis A. Allen A.P Strong Haney Oliver Sheldon Mooney & Railey Koontz & O'Donnell "Organization is the process of identifying and grouping of the works to be performed, defining and delegating responsibility and authority and establishing relationships for the purpose of enabling people to work most efficiently" - Louis A. Allen.

PRINCIPLES OF ORGANIZATION
Unity of objectives Efficiency Span of control or span of management Division of work Functional definition Coordination Scalar principle Unity of direction Unity of command Delegation

CONT..

Responsibility Balance Communication Personal ability Flexibility Continuity Exception principle

Importance of Organization
Encourages specialization. Eliminates the problem of duplicating and overlapping. Brings order and cohesiveness. Improves administration. Stimulates creative thinking. Facilitates effective communication. Helps to build up and expand the enterprise. Helps in the smooth delegation of authority.

Types of Organizations
All

the Organizations can be classified into two main categories:

Formal Organization
& Informal Organizations.

Formal Organizations
The formal organization is formally divided into three broad Forms Line Organization Line and Staff Organization Functional Organization Line Organization: This organization is also known as scalar or military or vertical or departmental organization, it is one of the oldest form of organization.

Line Organization Chart

Shareholders Board of Directors Chief executive Production manager

Factory Superintendent
Foreman

Line and Staff organization

This type of organization combines the advantages of both the line organization as well the staff organization. In such organization two set of staff is at work i.e, the advisory and the assisting staff technically know as staff executive and line executive.

Line and Staff Organization Chart

MANAGING DIRECTOR

Production Manager

Marketing Manager

Finance Manager

Plant Supervisor

Market Supervisor

Chief Assisstant

Foreman

Salesman

Accountant

Functional Organization
Functional or staff organization has come into existence n this form of organization authority becomes functional and specialized. Here authority does not flow downwards from the top, here single authority is done away with multiplicity of authority is introduced.

Functional Organization chart

Informal Organization

It is a natural and spontaneous structure, arising out of the social tendency of people to associate and interact. Its values, goals and tasks predominantly centre around individual and group satisfaction, esteem. Affiliation, friendship, etc. It is shapeless It consists an unwritten system of reward or punishment. Organization is not enduring and is dependent on the sentiments of members.

Steps in organization
1. 2. 3. 4. 5. 6. 7.

Determine and formulate objectives, strategies, plans and policies. Determine the activities involved to accomplish the objectives. Grouping of similar activities into tasks, sections and departments. Define responsibility and accountability for every person. Delegate the required authority to perform the task. Integration of activities through authority relationships and communication networks. Provide adequate physical facilities to perform the tasks effectively.

Delegation of Authority

According to Louis A. Allen Delegation is the dynamics of management . Delegate and get things done.

Need for Delegation

Limitations of one mans ability and time Specialized and technological needs Tendency to diversify and decentralize organization Employee motivation

Managerial development
Management by exception

Advantages
Delegation

develops coordination

Reduction in the burden of the executives Development of subordinates Provide continuity Facilities expansion Provide motivation

Disadvantages
Superiors

unwillingness to delegate

authority

Superiors attitude

Lack of confidence in subordinates

Psychological barriers Absence of control

 Inability
Fear

to take independent decisions

of criticism

Lack of necessary information and resource Lack of self-confidence Lack of incentives

Departmentation
Koontz and ODonnell Define A Department as a distinct Area, division or branch of an enterprise over which a manager has authority for the performance of specified activities

Advantages of Departmentation
Specialization:

division of labour and

specialization

Determining Responsibility Coordination Skills and talents can be Developed

Basis of Departmentation

Function

Product or Service
Customer

Location
Time

Process
Combination

Following Factors are create Departments in an Organization Cost Factor

Functional Specialization

Control Centre
Integration of Different activities Personnel factor

Centralization & Decentralization

Centralization According to Louis Allen, Centralization is the Systematic and Consistence Reservation of authority at central points within the organization

Benefits of centralization
Vital

Decision

Coordination Higher

Specialization and Communication Situations of efforts

Control

Emergency Duplication

Limitations of Centralization
Lack

of Initiative in the job

It hampers effective Communication Decisions are not taken by the people

Wastage of time and energy on routine matters

Decentralization
Henry Fayol states that Everything that goes to increase the importance of the subordinates role is decentralization, everything which goes to reduce it is centralization Louis Allen states that Decentralization is the systematic and Consistence Delegation of authority to the levels where the work is performed

Benefits of Decentralization
Burden

of decision making More freedom and independence Increase motivation Comparison of performance Setting up of profit centers Product diversification Fast changing environment Authority & responsibility

Limitations of Decentralization

Uniform policy Complexity of coordination Loss occurs by control of upper level managers Inadequate control techniques

Inadequate planning & control system

Limited availability of qualified managers

Span Of Management
Factors Determining Span of Management
Qualities
Nature

and abilities of executives

&significance of the tasks Capacity & quality of subordinates Levels of management Clarity of plans & responsibility

Line and staff Authority

Authority in organization is the right in a position to exercise discretion in making decisions affecting others. Power is the ability of individuals or groups to induce or influence the beliefs or actions of other persons or groups.

Conflict between Line and Staff

Line Authority:

Different point of views Irresponsibility of staff Staff encroach line managers authority Staff are not responsible for failures
Staff Authority:

Different point of views Line command for support services Line resist ideas given by staff Line do not provide enough authority

Reducing Conflicts between Line and Staff

The line and staff should understand their positions and functions in the organization. The line should be educated and encouraged to use the staff effectively The staff should work overcoming resistance to change The staff should realize that they command respect and reputation is due to their skills and expert knowledge. Constantly strive to increase proficiency

Committees
The Board of Directors constitute committee at the highest level. Involves policy making, decision making etc. Advantages: Benefits of specialized and collective knowledge of 2 or more people Helps in co-ordination and co-operation Different group interests will be accommodated

Limitations
Time consuming Process Tendency to compromise at every issue To manage and maintain is costly Aggressive groups may dominate.

Strategic business units(SBU).

Meaning

SBUs are distinct little businesses set up as units in a larger company to ensure that a certain product or product line is promoted and handheld as though it were independent business.

SBU specific criteria

Own mission Definable group of competitors. Own integrative plan. Manage its resources. Proper size

Thank you.