Service organisations provide services such as transportation to their customers. To follow cost- leadership strategy the structure has to be stable and cost efficient. Apart from this, the span of control of superiors i.e. This lesson will help you: Define management process 4. The purpose of creating the superior-subordinate relationship is to coordinate the efforts of all individuals/groups/departments towards the common goals and objectives of the business. (ii) Group those activities into interrelated functional areas. FACTA UNIVERSITATIS Series: Economics and Organization Vol. Organisation charts depict the delegation of authority and responsibility and the vertical and horizontal relationships of the different departments and the individuals manning the organisation, while, organisation manuals convey instructions for conducting regular activities. Overall tasks or activities of the organisation are determined to achieve this goal. For example- the marketing department may have separate sections such as market research, advertising, credit sales etc. The purpose of organising is for people to coordinate with each other and to work for the achievement of organizational goals. Thereafter the work must be divided into smaller and manageable activities to avoid duplication and share the burden among employees. Organizing involves a series of steps that need to be taken in order to achieve the desired goal. This interaction provides them an opportunity to know each other and develop personal and social relations. Allocation of Duties and Responsibilities: After grouping of activities assigning duties to competent individuals is done, after deeply analyzing their educational, professional and experience-oriented competencies. A broad and balanced curriculum will equip our children with a breadth of knowl… When the objectives have been set and policies framed, the necessary infrastructure of organization has to be built up. ADVERTISEMENTS: Read this article to learn about “Organizing: It’s Process, Structure, Importance , Characteristics and Other Details!” Any situation involving two or more persons working collectively requires organising. The next step is about classifying the authority and how much of it is allocated to the managers in the hierarchy. It’s important to point out though, that this is a process. It further creates hierarchy in the management. If the growth strategy is followed, it will need flexible, fluid and instantly adaptable organisation. People with an aptitude for figures and numbers may be seen fit for the accounts department. However, since organisational plans change with the passage of time, organisational objectives have to be also restructured. The departmental head delegates responsibility and authority related to departmental activities to members of his department. In the event of change, necessary modification may be made in the organising process, organisational structure and organisational goals, so as to bring them in conformity with the change. A business cannot function in anarchy. It is the duty of the management to clearly define the relationships in the organisation. iii. A superior-subordinate relationship is defined by which each superior should be aware of the extent of authority he/she can have over their subordinates. For example- it can be the objectives of the enterprise to produce mobile phones. Process of Organising – Steps: Identification and Division of Work, Departmentalisation, Alignment of Duties and Establishing Reporting Relationships Huge Collection of Essays, Research Papers and Articles on Business Management shared by visitors and users like you. Each company must decide for itself as to how much decentralisation of authority and responsibility it desires to have. Examples include Hallmark and Ford Australia. Determining total workload of the organisation is the first step in the process of organising. There are six basic steps to the process. Various steps of organizing process are as follows. People-structure relationship is important. This is presented in the following Table 9.1. The six steps are: Clarify strategy – Clarify high-level strategy statements, separating and organizing goals, objectives, initiatives, aspirations, and strategies. The steps are: 1. North zone, South zone, West zone, East zone. The organising function follows the function of planning and the other functions of management follow organising. In a highly decentralised organisational structure, each position is strengthened by delegating required authority. The rights are granted through the process of delegation. Plans are the means to achieve certain ends or objectives. Authority is the right to do something due to formal position. With the time, organisations grow and situations change. Lines of accountability are drawn in black and white. The last element is distinguishing between line and staff positions. Analyzing. While preparing Chocolate Candies, one only hots up the raw Chocolate, the next’s man puts hot stuff n dyes, the third person puts into fridge, the fourth person brings it out from the fridge and the dyes, the fifth person starts wrapping, and the next person puts then into boxes. Government of India’s organisation structure is an example of mechanistic or bureaucratic design, whereas some of the private sector firms like NUT, HDFC Bank, or ICICI Bank are examples of organic organisation structure. Management, Functions, Organising, Process of Organising. Explain the steps involved in the process of organising. James Stoner says, “Coordinating mechanisms enable members of the organisation to keep sight of the organisations goals and reduce inefficiency and harmful conflicts.”. Delegation of authority means when duties and tasks are entrusted to the subordinates by the superior, authority should be granted to them to perform those duties and tasks well. This is known as the division of work in management terms. Organisations operating in stable environment can gainfully employ a highly formalised structure. Since objectives of different enterprises tend to be different, they cannot afford to adopt just one topical organisation structure, and yet work efficiently. If the responsibility is greater than the authority given and is insufficient to cope with the responsibility, the responsibility cannot be discharged successfully. An organisation structure is the structural framework of all positions in a set-up. Defining clearly the inter-relationship helps in establishing coordination. Based on competence of individual and group acceptance. Thereafter, a number of groups will be combined and grouped into larger units or departments. the number of subordinates who should report directly to each superior is decided. Hence, organisation must provide a mechanism for coordinating the efforts of employees so that they can work together in team spirit. Organising is an ongoing process. Interdependence may be pooled, sequential and reciprocal. The historical boundaries are blurred by increasing an organisation’s interdependence with its environment. This will ensure overall control over the working of all departments and their coordinated direction towards the achievements of predetermined goals of business. For instance, production activity may be further divided into purchasing of materials, plant layout, quality control, repairs and maintenance, production research, etc. Enumeration of Activities – The total job is sub-divided into essential activities, e.g., the work of an industrial concern may be divided into the following major functions viz., purchasing, production, financing, personnel, sales, export promotion, etc. For example, the finance department wants to cut down costs, but marketing department wants more funds to advertise the products. The important steps of organising are discussed as under: All the work cannot be done by a single man or machine. By following the PROCESS steps below anyone can conquer any space of any size. When people work together in a formal relationship of superior and subordinate, they come in contact with each other. The need for organising function is felt whenever new activities or functions are introduced, or existing functions and activities are re-shuffled in the organisation. In short, who-is-who and who-will-do-what is decided. More routine the technology, the structure will be more standardised and mechanistic. Departmentally Organising the Activities: This step requires the manager to combine and group similar and related activities of the company into units or departments. It has no set boundaries; rather it operates in different directions. For instance/in a manufacturing concern, different kinds of purchases like raw material, spare parts, etc., can be put under purchase department. The process of organizing consists of the following steps: (a) determining and defining the activities required for the achievement of organizational goals; (b) grouping the activities into logical and convenient units; (c) assigning the duties and activities to specific positions and people; Departmentalisation: It involves grouping of similar activities into departments, units, sections etc. Before and After Closet Pantry Organization with Zero Dollars Spent! Organizing does this by creating and maintaining the activities in an accepted (manner) pattern, by inte… It is meant to engage in production of goods and/or performing service required by society. A flexible and implementable strategic facility planning based on the specific and unique considerations of your organization needs to be developed through a 4 step process. Division of work and specialisation are the tools used by organisation to attain the objective of optimum utilisation of human efforts and physical resources. Each person is given a specific job suited to him and he is made responsible for its execution. Identification and Division of work: The organising function begins with the division of total work into smaller units. Reviewing and Reorganising. 3. These personal and social relations become the basis of informal organisation. 1. The delegation of authority is responsible for creating subordinate- superior relationship. Proper allocation of resources helps in proper utilisation also. Allocation of Fixed Responsibility to Definite Persons – Here, specific job assignments are made to different subordinates, or ensuring a certainty of work performance. It is normative and idealistic in nature. They are. Identification and enumeration of activities: At the first stage of organising process, a manager identity and determines those activities that are to be performed for achieving common goals. Numerous tools for each step of the four-step process will also be suggested. If you’re ready to start spring cleaning your finances, these six steps will start you off on the right track: Step 1: Set Up a Filing System For Your Personal Finance Whether you stash your receipts and bills in folders or file them electronically in your computer, what’s important is that you keep all of the paperwork related to your personal finance together in a safe place. Grouping or Classification of Activities: In this stage grouping of activities related to one another is done. Authority provides right to decision-making to its holder who feels motivated to take initiative in increasing and improving his work performance. People are assigned their duties after matching their capabilities to the job requirements. It is only after granting authority to an individual that he can be made accountable. How many sessions might be needed depends entirely on the circumstances and on the coachee. Thus, structure of an organisation needs to be tailor-made than merely adopting the so-called ‘typical structure’. An organisation structure exhibits the following features: The first and foremost feature of an organisation structure is that it is a network of well-defined activities. Further, establishing reporting relationships facilitates coordination at all levels of management. Determining the Span of Control and Decentralization 8. The steps allow you to do one or all at a time depending on the time you have available for the task. 1. Welcome to EconomicsDiscussion.net! In other words, what they are to do for the attainment of the objectives of the organisation. The various activities are grouped into departments or divisions according to their nature. Account Disable 12. It will help in setting up of the proposed organisation and what will be nature of the work to be done through the organisation. For a sound and well-defined organising process, a business needs to undertake the following steps: Organising as a function begins with identifying all activities that are planned for a business based on their mission, goals and objectives. Organising is the second basic function of the management. However, of late the trend is towards broadening the scope of robs and reduced work specialisation. There should be proper arrangement for making available sufficient machinery, furniture, stationery, material, etc. Areas such as production and maintenance require certain technical skills and qualifications, and as such, jobs in these areas are given too technically qualified people. Here, the total organisation is made up of teams or work groups which perform the organisation’s work. Content Filtration 6. ... Measure the change process. For example- the activities like the purchase of raw material, purchase of ready-made parts, production, stocking the material, research, etc., are assigned to the production department. When two or more than two persons work for the attainment of common goals their inter-relationship must be defined very clearly. Grouping of activities into departments is called departmentalisation. Authority delegated to a person should commensurate with his responsibility. Division of work leads to specialisation which has the following benefits: Adam Smith illustrated a study where one person could manufacture 20 pins a day if he worked alone. 6. Organisational structure also provides a useful means to cope with changing environment. In order to create a balance and structure in the organisation, the activities of members need to be well-coordinated. Collecting Human and Material Resources 5. Each job should be classified under some category. “Getting organized” implies the creation of a harmonious work environment. Defining Authority and Responsibility. This implies the allocation of authority and responsibility among employees of the enterprise in such a way that each person should know who is responsible to whom and for what. It is there since Adam Smith published Wealth of Nations. Improved work technology modifies pattern of authority-responsibility relationships and helps in improving work performance of employees. … An organisation following differentiation strategy must innovate and add R&D to its organisation structure. After the work is assigned to people, those performing similar activities are grouped in similar departments. For example- the purchase manager will be given the responsibility for the purchase of goods; the sales manager will be responsible for the sales; the advertising manager will be responsible for advertisement and the finance manager will take care of the responsibility of finance. Assigning Work, Responsibility and Authority: 6. These departments can be either functional or divisional where in functional departments are related to common functions grouped into one department or divisional departments are created for businesses on the basis of either types of products, geographical location of the business or the targeted customer groups. 237 - 245 ORGANIZING AS THE PHASE OF MANAGEMENT PROCESS AND MANAGEMENT ACCOUNTING UDC 657.05+658.310.13 Ljilja Antić, Vesna Sekulić Faculty of Economics Niš, University of Niš, 18000 Niš, Serbia and Montenegro An organisation is a continuing entity. Organisation structure stimulates creative thinking and initiative among organisational members by providing them requisite authority to perform their assigned tasks. In this article, PulseLearning presents six key steps to effective organizational change management. Top management enjoys the highest degree of authority. Distribution of authority involves addressing two issues – delegation of authority and centralisation-decentralisation. The whole work is to be divided into smaller activities so that duplication is avoided and work can be completed as per the organisational objectives. The performance of departments and sections are to be compounded to achieve objectives. Everybody should clearly know to whom he is accountable. 2, No 3, 2005, pp. The demand is to meet the needs of customers, employees and other organisational stockholders. While designing an organisation structure, the managers must keep six elements in consideration. The organising process involves five broad steps: It is necessary to determine those activities which are essential to accomplish the organisational objectives. It is based on superior-subordinate relationships which are created by assignment of work and delegation of authority. Determining the Span of Control and Decentralization: (1) Knowing the Objectives of the Enterprise: Process of Organising – For Achieving Enterprise Objectives. This creates a structure of relationships where every individual knows his superiors and subordinates and their reporting relationships. An individual who is entrusted with the responsibility must be given authority necessary to carry out the duties assigned to him. Each task is inter-related, and the collective performance of all tasks by different position holders enables the achievement of organisational goals. Every individual is given the authority necessary to perform the assigned activity effectively. The process of grouping the activities of similar nature is called Departmentalisation. Similarly, advertisement and sales activities are given to the marketing department, and department of finance takes care of finance, accounts and correspondence. It will ensure efficient operation of the organisation to meet present needs. Various departments like production, marketing, finance etc. For instance, the total work of a manufacturing concern may be – (i) purchase of raw material, (ii) purchase of spare parts, (iii) marketing research, (iv) production, (v) raising funds, (vi) maintaining accounts books, etc. Clarifying the authority is useful in making the company’s operations efficient. Again, we shall discuss about the two concepts in detail later on. Table 9.1: Formal vs. 3. Steps in the process of Organizing. A line position means one who is in direct chain of command and is responsible for achievement of organisational goals, whereas a staff position is meant to provide guidance, expert advice, and support to line officials. These form ‘the building blocks’ of the organisational structure. Organising is based on the concept of division of work that ultimately leads to specialisation. Activities can be grouped on the basis of functions viz., production, marketing, finance, warehousing, administration etc. When the objectives have been set and policies framed, the necessary infrastructure of organization has to be built up. Teachers who have proficiency in Mathematics and skills to teach the subject will be employed under Mathematics department. Coordination between Authority and Responsibility: Healthy relationships between various groups facilitates smooth interaction which assists the organisation in achievement of its goals. Each major activity is divided into smaller parts. Co-Ordination 9. Formalisation is introduced through line of authority, unity of command, span of control, etc. For example, Purchase Department for purchase functions, Finance Department for financing activities, Marketing Department for marketing activities, etc. What was happening in the class the next morning was unimaginable. Reaping benefits of technology improvements: A sound organisation structure is flexible enough to accommodate changes in the work technology. Organisation structure of an enterprise operating in the midst of a highly dynamic environment organic will be different from the enterprise operating in a stable environment mechanistic. Organisation structure would be different at birth, youth, and midlife and maturity stages. Important steps involved in the process of organising are: 1. Under the grouping of activities all the similar type of activities are given to one particular department. It operates through group norms, values and standards. This is the step of grouping the work into specific departments, also known as departmentalisation. Organising process may also be used as a device of maintaining and achieving coordination. ii. Disclaimer 8. For example, a school may have different departments like teaching, office administration, library, sports, etc., and a particular department, say teaching, can further be sub-divided into smaller departments on the basis of subjects like Commerce, Economics, English, etc. i. The appearance of a typical organisation structure is shown in Figure 9.1. Nature of the organising function can be understood in reference to the following aspects: 1. Also, the levels at which various major and minor decisions will be made must be determined. Legally Constituted rationally designed and consciously planned. 6. The person who gives authority is called ‘superior’ and the person to whom authority is given are known as ‘subordinate’. There are no such rules as to which will lead to the best organizational structure. The concentration goes to activities and functions. The first step in the process of organisation is to know about the objectives of the enterprise. People know who is to direct whom for what results. On the basis of types of products – In this case, activities are grouped into different departments on the basis of products manufactured by the organisation. The process of organising involves the following steps: 1. Managerial positions are defined and the extent of their power and authority is fixed. It makes the optimum utilisation of human and material resources possible. After determining and enumerating activities, these are to be divided and sub-divided into small components known as jobs and tasks. There are superiors and subordinates who perform similar or different duties to ensure completion of a particular unit of work. Usually, this helps in laying out the departments. Example – The teacher should have assigned the responsibility of boards to one group, library maintenance to another and collection of notebooks to the third group. Fixation of duties and responsibilities is done for each and every employee of the organisation, so that everyone has their defined scope of operation. Before publishing your Articles on this site, please read the following pages: 1. This facilitates smooth operation of the management process which results in attaining enterprise goals. Classifying and Grouping Activities 4. TOS4. For example, Northern Zone, Eastern Zone, etc. Subsequent to containing all activities into specialised departments, employees working in these departments are assigned with only one job in that department that suit their skills, qualifications and capabilities. iii. So long as the authority to discharge the responsibility is not given, the person concerned has no accountability. This creates the chain of command right from the top to the bottom and a hierarchy is thus created. Its importance lies in serving the following purposes: 1. It is necessary to determine those work activities which are necessary to accomplish enterprise objectives and plans. Generally, an organisation structure has a pyramid shape, with less position on the upper side and more positions on the lower side. This helps in the expansion and growth of an enterprise. An important part of the planning process is to be aware of the business opportunities in the firm’s external environment as well as within the firm. After dividing the various activities into different departments and sub-departments and having determined the activity that each individual is expected to perform, his responsibility is fixed. What are the steps involved in Planning Process? Each position has a set of tasks, responsibilities, and authority. Thus, channels of communications are also created. Organisation structure of an enterprise using sophisticated capital- intensive mass-production technology will be different from the enterprise using labour- intensive small-scale production technology. Every individual subsequently delegates authority to individual in the lower hierarchical chain to them. 4 step process of facility planning are; 1. 2. This will help create a logical structure of authority-responsibility relationships and establish coordination. Here, both vertical and horizontal operating relationships are determined. (b) Once-for-all tasks – such as setting up a new plant or installing a machine. 4. Culture refers to a system of shared beliefs and values. 3. After departmentalisation, the next step is to assign the work to the employees according to their skills and competencies. This network of authority-responsibility relationships is called ‘organisation structure’. Those activities are determined on the basis of common goals. An individual cannot perform his job without the necessary authority or power. While getting all of this done can seem impossible, if you start organising yourself right away and delegate tasks to a competent team, you can make your event run smoothly and tackle anything the day might throw at you. Communication takes place through personal and social relationship. By authority, we mean power to take decisions, issue instructions, guiding the subordinates, supervise and control them. Prohibited Content 3. Establishment of Structural Relationship for Overall Control: Process of Organising – Determination of Objectives, Enumeration of Activities, Grouping Activities, Allocation of Fixed Responsibility, Delegation of Authority and Coordination, Process of Organising – Steps: Identification and Division of Work, Departmentalisation, Alignment of Duties and Establishing Reporting Relationships, – Division of Work, Departmentalisation, Assigning Duties, Delegation of Authority and Coordinating Activities, – 3 Major Steps: Division of Work, Formation of Departments and Reporting, Process of Organising – Identification and Division of Work, Grouping of Activities, Assignment of Duties and Delegation of Authority, Process of Organising – Determination of Objectives, Division of Activities, Grouping of Activities, Defining Authority and Responsibility, Reviewing and Reorganising, Process of Organising – Division of Work, Departmentalisation, Assigning Duties, Delegation of Authority and Coordinating Activities, Process of Organising – 3 Major Steps: Division of Work, Formation of Departments and Reporting. Stronger the culture, the structure can be predictable, orderly and consistent with no written documentation. Organising is a function of all managers: The management function of organising is practised by all the managers in the organisation. This grouping or combining of activities is called departmentation. For studies on internal corporate venturing, see: R.A. Burgelman, “A Process Model of Internal Corporate Venturing in the Diversified Major Firm,” Administrative Science Quarterly, volume 28, June 1983, pp. Establishment of Structural Relationship for Overall Control 11. Everybody should know who is his superior and who is his subordinate? or ’Organising is the process of defining and grouping the activities of the enterprise and establishing the authority relationships among them* In the light of this statement, explain the steps in the process of organising. Thus, in all the organisations key activity can be different. In fact, organization activities are detailed in terms of objective to be achieved. The second issue is centralisation (retaining power and authority in the hands of top-level managers) and decentralisation (distribution of authority to middle and lower-level mangers). The grouping of activities facilitates specialization. Performing the same task over and over again increases the skills and efficiency of workers. An organisation is a unified whole of the people and their activities. The top has more authority than the lower levels. Grouping and classification of activities helps to attain the benefits of specialisation. The real goal of the campaign is to carry out and keep thethe campaign is to carry out and keep the promises made. The concentration goes to activities and functions. Such grouping of activities is known as – “Departmentation”. From the previous banking example, all jobs related to managing car loans, home loans and business loans will come under the ‘Loans Department’. Objectives bring about unity of direction in the organisation. shoes division, garments division, bags division etc. This website includes study notes, research papers, essays, articles and other allied information submitted by visitors like YOU. 8. A comparative study of formal organisation and informal organisation will be useful to comprehend their real nature. Production of pin was broken into sub-activities where people carried out the following specialised tasks —. If an organisation has a product line then, activities can be grouped on the basis of products viz. Line of authority and how much decentralisation of authority is called a job work must be of! Point out though, that this is the extent of their specialisation individual subsequently delegates authority to perform assigned... 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