ORGANISIN

G
• The term organisation is used in management in two
different senses-
• Organization as a structure
• Organization as a process
• In the words of Allen, ”organising is the process of identifying and
grouping the work to be performed, defining and delegating
responsibility and authority and establishing a pattern of
relationships for the purpose of enabling people to work most
effectively together in accomplishing objectives.”
• In simple terms, organising is the act of putting things in their right
place and making sure everyone knows what they're supposed to do.
It's like arranging the pieces of a puzzle so that they fit together
perfectly. When we organize, we decide who does what, create rules
to follow, and make sure everything runs smoothly. It's all about
creating order and structure to achieve our goals efficiently.
NATURE

• Group of Persons
• Common objectives
• Division of work
• Cooperative efforts
• Communication
• Central authority
• Rules and regulations
• Delegation
IMPORTANCE OF ORGANISING

Goal
Resource Clarity and Reduced
Efficiency Achievemen
Utilization Focus Confusion
t

Innovation
Accountabili
Delegation Scalability and
ty
Creativity
STEPS IN THE PROCESS OF
ORGANISING

Identificatio
Grouping of Assignment Delegation
n of
activities of duties of authority
activities
 PRINCIPLES OF ORGANISING
• Unity of command
• Functional specialization
• Span of control
• Scalar principle
• Delegation of authority
• Functional definition
• Unity of command
• Exception
• Correspondence
• Absolute of responsibility
• Balance
• Unity of direction
• Simplicity
• Flexibility
• Efficiency
• Continuity
 Division of Labour
• Division of labour, often referred to as the division of labour
or specialization, is a fundamental concept in economics,
sociology, and management.
• It involves breaking down complex tasks or processes into
smaller, more specialized tasks that can be performed by
different individuals or groups. This specialization can occur
within an organization, a society, or even on a global scale.
Benefits of Division of Labour
Benefits to the producers
• Specialisation to the workforce
• Lowers operating costs
• Increase in productivity
• Higher profits
• Fosters cooperation
BENEFITS TO THE WORKERS
• Skill development
• Better employment opportunities and mobility
• Lesser training time
BENFITS TO CONSUMERS
• Lower prices of goods
• Better quality
 LIMITATIONS
• Boredom
• Less Skill development
• Less motivated workers
• Difficult to fix responsibility
• Interdependence of workers
• Applicable to standard products
SPAN OF MANAGEMENT

• What is Span of Management?

• What is an appropriate Span of
Management?
Factors Determining Span of
Management

Degree of
Capacity of Ability of
Nature of work Clarity of plans decentralizatio
the superior subordinates
n

Communicatio
Staff Location of Level of
n and control
assistance operations management
techniques
Span vs Level
of Organisation
 NARROW SPAN
ADVANTAGES
• More managerial control
• More chances of promotion
• Greater specialization
• Closer supervision
DISADVANTAGES
• Less employee empowerment
• Higher cost
• Delayed decision making
 WIDER SPAN
ADVANTAGES
• Reduction in cost
• Faster Decision making
• More employee management
• More responsive organization
DISADVANTAGES
• Lower chance for promotion
• Over burdened manager
• Weak control
• Less managerial expertise
 DELEGATION AND
DECENTRALISATION OF
AUTHORITY
What is the difference between Authority, Responsibility
and Accountability?
 Delegation of Authority
• Delegation of authority is the process of entrusting subordinates or
team members with the responsibility and authority to perform specific
tasks, make decisions, and act on behalf of their superiors or managers.
BENEFITS
• Delegation relives the manager from heavy workload.
• Delegation leads to better decisions
• It speeds up decision making
• Improves employee morale and motivation
• Creates a formal organization structure
• Training of subordinates
 DIFFICULTIES IN DELEGATION
(On the part of supervisor)
• Loss of Control
• Lack of Trust
• Time Constraints
• Inadequate Communication
• Difficulty in Task Selection
• Fear of Repercussions
DIFFICULTIES IN DELEGATION
(On the part of subordinate)
• Lack of Clarity
• Inadequate Skills or Knowledge
• Lack of Confidence
• Feeling Overwhelmed:
• Accountability Concerns
CENTRALISATION AND
DECENTRALISATION OF
AUTHORITY
• Centralization of authority is a management and
organizational structure approach where decision-
making and control are concentrated at the top or in a
single central point within an organization.
• In a centralized authority structure, a limited number of
individuals or a single individual, typically at the highest
levels of management, hold the primary decision-making
power
 Factors Responsible for
Centralisation of Authority
• To promote uniformity of policy and action
• To provide for integration
• To handle emergencies
 Decentralisation of Authority
• Decentralization of authority is a management and
organizational structure approach in which decision-
making and control are distributed across different levels
and units within an organization, rather than being
concentrated at the top.
• In a decentralized authority structure, lower-level
managers and employees have greater autonomy and
decision-making power.
 Measuring the Degree of
Decentralisation
• Number of Decisions
• Importance of Decisions
• Effects of Decision
• Checking of decisions
ADVANTAGES OF DECENTRALISATION
• Reduces burden of top executive
• Quick and better decisions
• Growth and diversification
• Better communication
• Development of executives
• Improvement in motivation and morales
• Democratic managemement
Disadvantages of Decentralisation
• Lack of Uniformity
• Coordination Challenges
• Risk of Inefficiency
• Loss of Control
• Unsuitable for small firms
ORGANISATION DESIGN
Classical Approach
Contingency Approach
 Organisation Design
• Organizational design is the process of structuring an
organization to achieve its strategic objectives efficiently
and effectively.
• It involves creating the framework, roles, relationships,
and systems necessary for the organization to function
optimally.
 Classical Approach
• The classical approach to organizational design refers to the traditional
and historically dominant principles of organizing and structuring an
organization.
• It is often associated with the early development of management theory in
the late 19th and early 20th centuries. The classical approach is
characterized by a hierarchical and bureaucratic organizational structure.
• The classical theory of organisation design was shaped by Taylor, Fayol
and Weber
 Factors Affecting Organisational
Design in Classical Approach

Hierarchy Span of Control Scalar Principle Unity of command Division of Labour

Parity between Balance between

Departmentalisatio
Coordination authority and centralization and Formalisation
n
responsibility decentralization
 CONTIGENCY APPROACH
• The contingency approach to organizational design is a
management theory that recognizes that there is no one-
size-fits-all solution when it comes to designing and
structuring organizations.
• Instead, the contingency approach emphasizes that the
best organizational design and management practices
depend on the specific circumstances or contingencies
faced by an organization.
Factors Affecting Organisational
Design in Contingency Approach
• Environment
• Size of the Organisation
• Technology
• Strategy
• People
DEPARTMENTALISATION
• Departmentalisation is the process of dividing an
organization into smaller units or departments based on
certain common characteristics, functions, or tasks.
• This practice helps organizations to achieve clarity in
roles and responsibilities, improve communication and
coordination, and streamline the management of various
activities.
 Basis of Departmentalization

Functional Product Geographical Process

Departmentalizati Departmentalizati Departmentalizati Departmentalizati
on on on on
MERITS
• Specialisation
• Simple
• Facilitates functional training
• Coordination
• Flexibility
• Better supervision and control
DEMERITS
• Problem of coordination
• Loss of focus on organizational objectives
• Addition to cost
• Delayed decisions
• Difficulty in fixing responsibility
• Limited Managerial development
Geographical Departmentalisation
MERITS
• Ease in expansion
• Adaptation to local market
• Managerial development
• Fixes responsibility and accountability
• Autonomy in decision making
• Lower transportation cost
DEMERITS
• Coordination with other departments
• Conflicts with head office
• Duplication of activities
CUSTOMER DEPARTMENTALISATION
MERITS
• Customer orientation
• Expertise
• Positive perception and image
DEMERITS
• Understanding customer’s needs and problems is not easy
• This departmentalization is not suitable for small
organisations
Departmentalisation based on
process

• Departmentalization based on process is a way of

organizing a company's structure by grouping activities
and functions together according to the specific
processes they are involved in.
MERITS
• Specialisation
• Optimum utilization of resources
• Economy and efficiency
• Facilitates skill development
DEMERITS
• Not suitable for smaller organisations
• Coordination issues
TYPES OF ORGANISATIONAL
STRUCTURE
• Organizational structure refers to the way a company
arranges its employees, roles, and functions to achieve
its goals and objectives efficiently.
• It defines the hierarchy, relationships, and
communication channels within the organization.
 TYPES OF ORGANISATIONAL
STRUCTURE
• Line Organisation
• Functional Organisation
• Line and staff Organisation
• Project Organisation
• Matrix Organisation
• Network or boundaryless Organisation
 LINE ORGANISATION
• A line organization, also known as a line structure or
scalar organization, is one of the simplest and oldest
forms of organizational structures.
• It is characterized by a clear and direct chain of
command with a single unbroken line of authority and
responsibility running from top management to the lower
levels of the organization
 Pure line and Departmental line
Organisation
• A "Pure Line Organization" is a traditional organizational
structure characterized by a clear and direct chain of command.
• Departmental line Organisation: This term refers to an
organizational structure that incorporates the principles of a line
organization within individual departments or units of the
organization. Each department operates with a line structure
within its domain.
Pure line Organisation
MERITS
• Simplicity
• Quick decisions
• Unified control
• Discipline
• Fixed responsibility
• Coordination
LINE AND STAFF ORGANISATION
PROJECT ORGANISATION
MATRIX ORGANISATION
NETWORK
ORGANISATION
FORMAL AND INFORMAL
ORGANISATIONS
 Formal Organisation
• A formal organization is a structured and planned entity
that follows a set of established rules, regulations, and
procedures.
• It is designed to achieve specific goals and objectives
through a systematic arrangement of roles,
responsibilities, and relationships among individuals
within the organization
 ADVANTAGES OF FORMAL
ORGANISATION
• To reduce confusion and uncertainity
• To provide specialization
• Goal Achievement
• Accountability
• Scalability
• Legal and Regulatory Compliance
• To clear paths for promotion
 DISADVANTAGES OF FORMAL
ORGANISATIONS
• Rigidity
• Bureaucracy
• Communication Barriers
• Overemphasis on Rules
• Employee Disengagement
• Conflict
INFORMAL ORGANISATIONS
• An informal organization refers to the network of social
relationships, interactions, and communication that
naturally develops within a formal organization, often
based on common interests, friendships, or shared
experiences among employees.
• It exists alongside the formal structure and is not
officially recognized by the organization.
Advantages of Informal
Organizations
• Enhanced Communication
• Fostering Social Relationships
• Quick Problem Solving
• Adaptability
• Identifying and Addressing Concerns
• Strengthening Organizational Culture
Disadvantages of Informal
Organizations
• Lack of Control
• Interference with Formal Structure
• Exclusivity and Favouritism
• Overemphasis on Social Bonds
• Potential for Misinformation
• Unpredictable
• Resistance to Authority