CHAPTER 5 organising ESSENTIAL POINTS TO SOLVE CASE STUDIES Concept Of Organising Organising can be defined as a process that st positions and defining relationships, organisational goals. “Organising is the process of defining and grouping the activities of the ent wprise and establishing authority relationships among them.” —Theo Haimann “Organising 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 most effectively, together in accomplishing objectives,” Louis Allen Steps in the Process of Organising 9 Identification and Division of work. The amount of work to be done is identified and is divided into tasks which are achieveable,, a Departmentalisation. Related activi a Assignment of Duties. Job positio for these positions. 2 Establishing reporting relationshi in order to eliminate any chanc formation of hierarchical structur 'e of management, Inportance § Onganising 9 Benefits of specialisation. Organising leads to Performed regularly by the concerned person. 9 Clarity in working relationships, W: Proper organising. > Optimum utilization of resources. There is reductior overlapping of activities after proper organising, © Adaptation to change. A well organised business firm can arts implementation of Plans by specifying job and effectively distributing resou urces for attainment of ities are clubbed under the banner of one department ns are created and the concerned duties are assigned ps. It is important to clarify who will report to whom es of conflicts and confusions. The outcome is the Pecialisation, as the assigned work is orking and reporting relationships get clarified after n in duplication of efforts and adapt to external changes.78 © Business Stutier—Case tudes Tai PAIREK {an organisation becomes Q Effective administration. On the administration fr nei defined Q Development of personnel. When jobs are a eerie ae in actual work eee structure can be replicated as ang When @ Expansion and growth. A properly 0 : ae aes ‘opening of new branches. : Organisation Structure, An organisation requires a proper framewsr’ © and perational tasks This framework i known as Organisation SIT oe The role of organisation structure isto develop a proper relationship, among, _ (employees), work (asks, activites, projects) and resources (information, human fi i An organisation structure cannot be seen unless and until it 2 Ere ries of paper Span of Management. Span of management means the number o - Pe. tant here ae vely managed by a superior or manager. The word ‘effectively’ is very Ba manarence® No use of increasing the span of a manager if it reduces the effectiveness gement, Phere are two types of Organisation Structures A. Functional Structure is the organisation structure which is formed on the basis of functional specialisation. It is good for a company which is dealing in a single produc and is increasing or expanding itself. better a5 1 framework to do various manages (Human Resources] [Purchase Production Marketing Merits/Advantages of. a Functional Structure: G It helps in increasing coordination among the various activities of the business as he closely related activities are grouped under the same department. @ The specialisation, which comes out due to division of work here is based on occupation job/activity. Q All the tasks of mana; functional structure. Q Each collection of connected activities like Marketing, Purchase, Production, etc. ge proper and required attention, : a It is a very good structure to train erial and operational nature are properly taken care of undet Saelalaer "©, duplication and wastage of efforts #! Disadvantages of Functional Structure: The departmental goals in the func te organisational goals, “enctional structure take eaddepartments try to have their own quota of interests fulfilled leading to conflict J of interests: _ _ Sanaity case the size of an organisation and the diversity of activities handled is pcre jt is advisable for a firm to adopt functional structure 7 Structure is the organisation structure which is formed on basis of vision ara alisation. It is good for a company which is dealing, in multi products (more 5 juct spect iS cone product). Managing Director ( Ss) ee) | J t ‘ Human Resource Department Purchase Department Production Department Marketing Department Remember: Each division gets its own set of Departments. Advantages of Divisional Structure: 4 Product specialisation. Due to product specialisation varied skills get developed in a single divisional head. All functions are under him giving him in all functional departments. : 2 Responsibility for poor performance of the division can easily be fixed on the divisional heads. They are accountable for revenue, costs and profits of their division. alt promotes flexibility and initiative because each division functions as an autonomous unit which leads to quick decision-making. a It facilitates expansion and growth as a firm is able to add new divisions without disturbing the existing operations of the business enterprise. & Quick decision-making. Every Division works as a separate unit and is independent. The Divisional Manager gets the right of taking any decision regarding his division on his own without consulting other divisional managers. Disadvantages of Divisional Structure: ges of Divisional Struct | ; Q Divisional structure is costly as all the functions like HR, Purchase, ete. are replicated with addition of a new product. | nn a Q Chances of conflicts are always high among various divisional heads as they can try to have more funds from the top management in comparison to each ates aa Q Though it is good to have an influential divisional head yet sometimes his int uence s may and authority can cause problems for the top management as the employees more loyal towards him. — — Suitability. When the number of products handled by & company i wore hana 8 Cliveen att wities under different products of differen compnay in a divisional structure.mal Organisation ral organisation Te achieve onganisational ganisation structure wh ich Pound by rules and proceg edu, 0 the oF nd is rst Formal Organisation. A form ere ols framed by the top management 0 Poaturcs of Formal Orgnivation 2. In formal organisation, job Pos 2 Ttis run according to the set ru) 3 Top management purposely frames the s! achieve its desired objectives: structure in W itions and reporting relationships are clearly stateg es and procedures H edutize of formal organisation in ore, ich activities of all departmens, ay Q It is the framework of a formal coordinated. @ The main focus is on work and not interpersonal relationships Adeantages of, Formal Orguisation : pitty relationships are clearly sta ‘bility as authority-respons! ionsh jearly defined s0 wast ts is minimised. Joyee should report only to his boss and there, a Its easy to fix respons! Q Role of each member is © Q Formal structure ensures that an empl tunity of command is followed. on 2 Proper formal structure brings stability to the organisation: Aimitations|Disadvantages of Foumal Orgnisation 1g Procedural delays may result due to communication on formal lines. 3 Strict following of rules and procedures may reduce creativity of the employees. 3 Sometimes human needs and grievances are not given proper attention. Informal Organisation. Informal Organisation refers to the network of social relations formei due to the interaction among ‘individuals. It is formed spontaneously as individuals interact ani associate to fulfill their personal and social needs. Features of Tegormal Orgnisation Q The origin is spontaneous an 5 The norms of the group guide a Independent channels of communication ‘exist rather than scalar chain. Advantages 4 Informal. Orgnisation 3 Flow of information is fast as there are no set rales. 5 Informal organisation within the formal organisation helps in the fulfilment of social ne © Organisational objectives are ‘achieved faster as various shortcomings organisation can be overcome, d is within the formal organisation. the members how to behave. Limitations Disadvantages of Informal Orguisation "5 A bad informal group can hamper the growth of the whole organisation. 2 ae cooperative informal organisation or group generally obstructs the introduc” cositive changes by unnecessarily ‘opposing them. 1g In order to get favour of the members ‘of the informal organisation, even th raployees may go against the interest of the formal organisation respons