ORGANIZING

Ms. Ashita Chadha

Organizing

Process off determining the activities to be performed, arranging these activities to administrative units, as well as assigning managerial authority and responsibilities to people employed in the organization.

Organizing 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 more effectively

together in accomplishing objectives”.

Louis Allen

Importance of Organizing

Focus to facilitate the attaining of objectives Arrangement of positions and jobs within the

Hierarchy Define responsibilities and line of authority of

all levels Creating relationships that will minimize

friction Classification of work and assigning it to

different departments helps in bringing specialization in managerial functions

Characteristics of Organization

Division of labour : Organization deals with task of the

business as a whole. The work is assigned to different persons for efficient accomplishment and specialization with the help of Organization structure.

Co-ordination : It helps in integrating and harmonizing

various activities which in turn avoids duplication and delays.

Well defined Authority and responsibility relationship : An Organization consists of various positions arranged in a hierarchy with well defined authority and responsibility.

Co-operative Relationship :Relationship should be both vertical and horizontal among members.

Successful Goal AchievementThe organization has the will and means for maintaining Clarity of Direction

Constituents of Organizing

1. Organization Organization Design Organization Structure Departmentation Organizational Relationship

2. Span of Control3. Employee Empowerment

Centralization and Decentralization Power an d Authority Delegation

4. Organization Culture

Centralization and Decentralization

Centralization is the concentration of decision-making and action at high level management.

Decentralization is the consistent delegation of authority to the lower levels where the work is performed.

Delegation:

Process off assigning work from a top organizational level to a lower one or from superior to subordinate, and giving that person the authority to accomplish them.

Allocation of duties Delegation of authority Assignment of responsibility Creation of accountability

Barriers to successful delegation

Lack of superior's ability to direct the subordinates

Lack of confidence in subordinate Absence of control

Major causes of managers’ refusal todelegate

Tendency to do things personally Desire to dominate the knowledge,

information, and skills Unwillingness to accept risks of wrongs

Principles of delegation

Responsibility can not be delegated Authority and responsibility should be

delegated in equal proportion.

Authority :

The right to take final decisions,, to act or to command action off others

It moves in a downward directiion.

Types of authority

Ultimate authority Legal authority Technical authority Operational authority

Responsibility:

The obligation involved when one accepts an assignment.

It cannot be delegated, it may be continued or it may be terminated with the accomplishment of the goal.

Span of Control:

Number of subordinates that can be adequately supervised by one supervisor.

Dimensions of span of control Narrow span of control Wide span of control

Narrow span of control

Advantages: Close supervision. Close control. Fast communication between subordinates

and superiors.Disadvantages: Superiors tend to get too involved in

subordinates’ work. Many levels of management. High costs due to many levels.

Wide span of control

Advantages: Superiors are forced to delegate. Clear policies must be made. Subordinates must be carefully selected.Disadvantages: Tendency of overload superiors to take

most or all decisions. Danger of superior’s loss of control. Requires exceptional quality of managers.

Tall versus Flat Organizations

Formal and Informal Organization Organizations can be categorized as

informal or formal, depending on the degree of formalization of rules within their structures.

Formal Organization

Management has determined that a comparatively impersonal relationship between individuals and the company for which the work is viewed as the best environment for achieving organizational goals.

Subordinates have less influence over the process in which they participate, with their duties more clearly defined

Informal organizations

Informal organizations, on the other hand, are less likely to adopt or adhere to a significant code of written rules or policies.

Individuals are more likely to adopt patterns of behaviour that are influenced by a number of social and personal factors.

Changes in the organization are less often the result of authoritative dictate and more often an outcome of collective agreement by members.

Informal organizations tend to be more flexible and more reactive to outside influences.

STEPS IN ORGANIZING

1. Division of labour

2. Departmentalization

3. Appointing Suitable persons

4. Delegation of Authority

DIVISION OF LABOUR

DIVISION OF LABOUR

Division of labour is the breakdown

of labour into specific, circumscribed

tasks for maximum efficiency of

output, particularly in the context of

manufacturing.

Departmentalization

Departmentalization refers to the process of grouping activities into departments.

Division of labour creates specialists who need coordination. This coordination is facilitated by grouping specialists together in departments.

Types of Departmentalization

Functional departmentalization - Grouping activities by functions performed.

Product departmentalization - Grouping activities by product line.

Customer departmentalization - Grouping activities on the basis of common customers.

Geographic departmentalization - Grouping activities on the basis of territory.

Process departmentalization – Grouping activities on the basis of different steps involved in the process of manufacturing or delivery of a product or service.

Functional departmentalization

Functional departmentalization groups people by expertise and resources used. It is the most widely used and accepted form of departmentalization .

This approach also enhances career development and training within the department, while also allowing superiors and subordinates to share common expertise.

Product departmentalizationProduct departmentalization arranges your business along “product” lines .Product departmentalization can allow for quicker changes in a product line , more concern for customer demand, as the impact of customer demand can more easily be traced to a particular department.

Place departmentalization

Place departmentalization is based on geographic area, and groups all functions for the area at one location under one manager.Advantages to the place approach are that managers develop expertise in solving problems unique to their location and get to know their local customer's very well.

Customer departmentalizationCustomer departmentalization breaks the organization into groups based on the type of customer served. It is used to ensure a focus on customer’s needs expertise in solving problems unique to

their location, know their local customer’s problems definitive identification of key

customers

Process departmentalization

Departmentalization by process groups jobs on the basis of product or customer flow. Each process requires particular skills and offers a basis for homogeneous categorizing of work activities.

Appointing Suitable persons

When activities are divided into different functions , the next step will be to appoint suitable persons for various jobs. Experts are appointed as a head of Departments.

Delegation of Authority

A person will be able to perform duty only when he is given adequate authority required for that job. If the work is assigned without delegating it is meaningless. Authority and responsibility always go together.

Forms of Organization Structure

Line Organization Functional Organization Divisional Organization Matrix Organization Virtual organizations

Line Organization

• An authority relationship in organizational positions where one person (a manager) has responsibility for the activities of another person (the subordinate). In such organization, top management has complete control, and the chain of command is clear and simple.

Line Structure

Owner ManagerAssistantManager

HourlyEmployee

Convenience Store

Staff Organization

• Staff refers to those members who perform purely advisory functions.

• Staff personnel use their technical expertise to indirectly assist line personnel, aid top management and provide support, advice, and knowledge to other individuals in the chain of command.

• For example, Human Resource department employees help other departments by selecting and developing a qualified workforce.

Line-and-Staff Organization

PlantManager

EngineeringHuman

Resources

ProductionManager

Supervisor SupervisorSupervisor Supervisor

Employees EmployeesEmployeesEmployees

Line relationship

Staff relationship

FUNCTIONAL ORGANIZATION

Functional authority is referred to as limited line authority. It gives a staff person power over a particular function. It is given to specific staff personnel with expertise in a certain area. For example, members of an accounting department might have authority to request documents they need to prepare financial reports

Functional authority is a special type of authority for staff personnel, which must be designated by top management.