Meaning/Concept of Organizing
Organizing is grouping the elements of an organization in the best possible manner. It is a process of defining the essential relationships among people, tasks and activities in such a way that all the organization’s resources are integrated and coordinated to accomplish its goals efficiently and effectively.
Importance of Organizing
The following are the importance of organizing.
1. Brings organizational efficiency:
Organizing involves building a structure that defines activities and their relationships. It avoids confusion and delays in performing the works. It further removes duplication of work and overlapping of efforts. Coordination is established. Finally, organizational efficiency increases.
2. Facilitates specialization:
The structure clearly defines the duties and responsibilities of the employees. The employee is informed and knowledgeable about their works. They perform their duties more efficiently resulting in job specialization.
3. Optimum use of human and other resources:
Organizing ensures the right person for the right job. It motivates the employees toward the individual as well group goal. It also provides the benefits of specialization which results reduction in costs. It also ensures the effective allocation of other organizational resources
4. Effectiveness in communication:
Organizing establishes effective communication among departments or units of an organization. Different jobs and positions are interrelated by structural relationships. It specifies the channel and mode of communication among the departments or units.
5. Growth and diversification:
When resources are optimally utilized with a proper division of work among departments, organizational activities can be carried smoothly. This allows organizations to expand and grow by facing environmental challenges.
6. Employee development:
When the roles and activities to be performed are clear, it allows the employees to develop their skills and knowledge. It helps to build shared goals between the employees and the organization and toward a sustainable organization.
7. Establishes authority and responsibility relationships:
The organizational structure dictates the relationship among the members of the organization. It brings efficiency to job performance. All the members become aware of their duties and responsibilities. It also brings cooperation among them. It finally helps for a congenial organizational environment.
8. Improves job satisfaction and productivity:
Organizing involves clarifying the job positions. The roles assigned to every level are clear. It boosts mental satisfaction creating a sense of security among the employees. This is very important for job satisfaction.
Process of Organizing
Organizing is a complex process. It demands thorough knowledge of organizational plans, policies and strategies. Organizing as a process involves the following steps.
1. Determination of Objectives
Every organization is established for achieving certain objectives. Hence, the determination of short as well as long-term objectives is a major function of an organization. The short-term objective should support the achievement of long-term objectives. The objectives should be specific measurable, achievable, realistic, and find bound.
2. Identification and Grouping of Activities Identification of activities:
In the first step of organizing, all the organizational activities are identified. Organizational activities vary with the nature and size of the organization. They are related to finance and accounting, production and operation, marketing and sales, human resource, and research and development. Grouping of activities: In this step, the related activities are combined and grouped into units or departments and it is called departmentalization. Similar and related activities are grouped together under a department or unit which may be further be divided into sub-departments or groups. Grouping of activities helps to secure specialization. It should be done considering human factor, the nature of activities, and the needs of the organization.
3. Assigning Duties and Responsibilities
In this step, the duties and responsibilities of discharging the activities are assigned to different individuals according to their skill, knowledge, ability, and aptitude. The responsibility of every individual is defined clearly. It is done to avoid duplication of work and overlapping of effort. Each individual is given a specific job best suited to him/her and made responsible for its execution.
4. Delegation of Authority
After assigning duties, each individual is delegated the authority necessary to perform the assigned duties effectively. The authority delegated should be commensurate with the responsibility assigned. Delegation of authority establishes a clear hierarchy of authority or chain of command running from the top to the bottom of the structure.
5. Coordinating Activities
Organizing involves coordinating activities. It is an orderly arrangement of activities or efforts to achieve unity of action in pursuance of a common goal. It ensures that different departments and groups work in harmony and synchronization. Coordination is necessary to remove conflicts between employees or departments, duplication of work, and wastage of time and efforts. It also ensures that all the departments are carrying out their tasks and there is harmony between them.
6. Differentiating among Positions
Organizing also involves differentiating among positions, i.e. line and staff positions. A line position is the position in the direct chain of command. It is responsible for the achievement of organizational goals. On the other hand, a staff position is a supportive position, hence provides expertise, advice and support for line managers.
7. Reviewing and Reorganizing
The organizing process should be constantly reviewed and appraised so that organization structure can be modified or adjusted as per changes in the internal and external factors
Principles of Organizing
Organizing is based on certain principles. They are the building blocks of organizing.
1. Specialization
According to the principle of specialization, the whole work of an organization should be divided amongst the employees based on their qualifications, abilities, and skills. Through the division of work, specialization can be achieved.
2. Functional Definition
According to the principle of functional definition, all the functions in an organization should be clearly defined. It involves defining the duties, responsibilities, authority, and relationships of people in the organization. Clarifications in authority-responsibility relationships help in achieving coordination for efficient organization.
3. Span of Control/Supervision
A span of control is the length or range of supervision. It shows the number of employees who can be handled and controlled effectively by a single manager.According to this principle, the number of employees that a manager can handle under him should be determined. This decision can be taken by choosing either from a wide or narrow span.
a. Wide span of control:
It is one in which a manager can supervise and control a large number of subordinates at a time.
b. Narrow span of control:
Under this, a manager supervises and controls few subordinates under him.
4. Chain of Command and Unity
The chain of command is a line of authority that links all persons in an organization and defines who reports to whom. This has two underlying principles: the unity of command and the scalar principle.
a. Unity of command:
This principle states that an employee should have only one supervisor to whom he/she is directly responsible. No employee should report to two or more people.
b. Scalar chain:
The principle of scalar chain refers to a clearly defined line of authority in the organization. In other words, there should be a clear and unbroken chain of command linking every person in the organization.
5. Unity of Goals/Objectives
All organizational activities are directed towards organizational goals which are formulated for each level (top, middle and low) and each functional area. The goals must be clearly communicated and understood by all. All the levels, areas, and units should support each other to achieve the goals effectively.
6. Delegation of Responsibility and Authority
Authority and responsibility must go hand-in-hand. Responsibility means an obligation to carry out the assigned task which requires a certain level of authority. The tasks assigned should be performed within the scope of authority. The responsibility without authority will result in poor performance.
7. Flexibility
Modern organizations are operating in a competitive, complex and volatile environment. Their success largely depends on how they address the environmental impacts. For this, they should be situational or flexible. Organizations are required to change their plans, policies, and structure with the changes in the environmental factors.
8. Exception
The managers should perform several diverse activities according to rules, policies and procedures of the organization. However, they may be exceptional while dealing with complex and unusual situations. It allows them to respond the situations promptly and enhance creativity in decision making.
9. Personal Ability
According to this principle, an organization should constantly work for enhancing efficiency of the workers at all levels. This can be achieved through training and development programs. It further helps to enhance productivity and worker commitment.
10. Balance/Coordination
There should be a good balance between the parts of an organization. In other words, the organization should develop its structure in a balanced way so that coordination may be maximized. There must be a trade-off between centralization and decentralization.
11. Efficiency
An organization runs on the principle of efficiency. this is achieved by operating the organization with minimum cost and effort. The cost of the product is kept as low as possible without compromising the quality. This can be achieved by using the human as well as other resources effectively through proper organizational structure.
12. Simplicity
This principle states that the organizational structure should be simple. A simple structure is well understood by all employees. They became clear about their duties and responsibilities. The structure should be less hierarchical and with a clear path of communication.
Approaches to Organizing
There are three major approaches to organizing. They are the classical approach, behavioral and contingency approaches.
1. Classical Approach
The classical approach of organizing advocates one best way to manage the organization. It is also called the universal approach. This approach to organizing can be better highlighted through scientific management, administrative management, and bureaucratic theories. The scientific management theory advocates an increase in production by effective planning and controlling, use of modern machines and tools, and optimum utilization of resources to minimize cost of production and increase profit. This theory attempts to develop workers’ efficiency through modern machines and tools and proper remuneration. It is based on maximizing the degree of cooperation between the employer and employees and employee development through training and development. The administrative management theory attempts to find a rational way to design an organization as a whole. It is based on formalized administrative structure, a clear division of labor, and delegation of power and authority to administrators. This theory defines management in terms of functions such as planning, organizing, staffing, directing and controlling and provides a comprehensive framework for the study and development of management. The bureaucratic theory contains two essential elements: structuring an organization into a hierarchy and having clearly defined rules and procedures to run the organization. There are several characteristics in bureaucracies that would effectively help in decision-making, controlling resources, protecting workers and accomplishment of organizational goals. According to this theory, the organization should have a high degree of division of labor and specialization with a well-defined chain of command and the principle of rationality, objectively and consistently. There should be a formal relationship among the member of the organization based on positions with well-defined rules and regulations
2. Behavioral Approach
The behavioral approach advocates the importance of behavioral and human aspects of organizing. Three leading theories under this are Maslow’s needs hierarchy theory, McGregor’s Theory X and Y, and Herzberg’s two-factor theory. Maslow’s need priority (hierarchy) theory is based on the human needs, comprising a five-step model depicted as hierarchical levels within a pyramid. The needs lower down in the hierarchy must be satisfied before individuals can attend to the needs higher up. He advocated the importance of these human needs while organizing. Douglas McGregor developed Theory X and theory Y. Theory X is the traditional theory of management philosophy. According to this theory people want to avoid work as much as possible, meaning that they do not wish to take responsibility. People are motivated through financial incentives. They must be continually controlled; hence the system of rewards and punishments works best for them. Contrary to theory X, theory Y assumes that people are inherently happy to work. They are motivated to pursue the objectives. There is no need for a rewards and punishment system. People are prepared to take responsibility for everything they do and want to use their creativity in solving problems. Herzberg’s two-factor theory believes that some job factors result in satisfaction while other job factors prevent dissatisfaction. Herzberg used the term ‘hygiene and motivators to describe job satisfaction. The hygiene factors are extrinsic and are related to things such as compensation, job security, career development, organizational politics, working conditions, quality of leadership, and relationships between supervisors, subordinates, and peers. Motivators are intrinsic and include responsibility, job satisfaction, recognition, achievement, opportunities for growth, and advancement.
3. Contingency Approach
The contingency approach of organizing states that management is situational in nature. It assumes that management principles are not universal in nature as there is no best style of management. It focuses on the multivariate nature of organizations and helps organizations to operate under different environmental conditions. It provides a framework for solving problems according to the environmental conditions. It advocates organization’s adaptability to both internal and external environments and fit between them.
a. Size of the organization:
The size of the organization has major impact on organizing.Larger organizations are likely to have more hierarchies and units.
b. Task and technology:
The intensity of use of technology also affects organizing. It governs the pattern of communication, ways of doing jobs, relationships among the employees, and authority-responsibility patterns.
c. Environmental uncertainty:
The degree of environmental uncertainty also affects the organizing function. If the organizational environment is volatile,a flexible structure is preferred. On contrary, an organization may be organized in a formalized way if it is operating in a relatively stable environment.
d. Individual differences:
Individual differences in the leadership of an organization also determine the way an organization is organized. For example, an authoritative leader tends to centralize authority to the upper level.
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