Management Notes

Reference Notes for Management

Organizing – Meaning, Importance, Process, Principles and Approaches | Principles of Management (POM)


Meaning of Organizing

Organizing refers to grouping elements of an organization in the most effective way. To accomplish an organization’s goals efficiently and effectively, all its resources must be integrated and coordinated to define the essential relationships between people, tasks, and activities.

Importance of Organizing

The following are the importance of organizing.

  1. Enhances organizational efficiency
  2. Specialization is facilitated
  3. Optimal use of human and other resources
  4. Communication effectiveness
  5. Diversification and growth
  6. Employee development
  7. Relationships of authority and responsibility are established
  8. Enhances productivity and job satisfaction

a) Enhances organizational efficiency: As part of organizing, a structure is built which defines the activities involved and their relationships. By doing so, confusion and delays in the completion of the work can be avoided. As a result, duplication of effort and overlap of efforts are further reduced. It is established that coordination will take place. As a result, organizational efficiency increases.

b) Specialization is facilitated: There is a clear definition of the duties and responsibilities of the employees in the structure. Employees are knowledgeable about their jobs. The result is that they are able to perform their duties more efficiently, resulting in a specialization of their jobs.

c) Optimal use of human and other resources: It is important to organize so that the right person is hired for the right position. In addition to motivating employees toward their individual goals, it also motivates them toward the team goals. A reduction in costs is also achieved through specialization. Besides allocating organizational resources effectively, it also ensures the effectiveness of other processes

d) Communication effectiveness: Communication between departments or units of an organization is facilitated by organizing. There are structural relationships between different jobs and positions. Communication channels and modes are specified between departments or units.

e) Diversification and growth: Organizational activities can be carried out smoothly when resources are optimally utilized and work is divided among departments. By facing environmental challenges, organizations can expand and grow.

f) Employee development: It is easier for employees to develop their skills and knowledge when the roles and activities are clearly defined. By building shared goals between employees and the organization, a sustainable organization can be created.

g) Relationships of authority and responsibility are established: Relationships among members of an organization are determined by the organizational structure. As a result, job performance is more efficient. It becomes apparent to all members what their responsibilities are. As a result, they also become more cooperative. Ultimately, it contributes to a congenial work environment.

h) Enhances productivity and job satisfaction: Clarifying job positions is part of organizing. Each level has clearly defined roles. As a result, employees feel more secure and satisfied. Job satisfaction depends heavily on this.

Process of Organizing

The process of organizing is complex. It requires a thorough understanding of organizational policies, plans, and strategies. Following are the steps involved in organizing.

  1. Defining the objectives
  2. Identifying and grouping activities Identification of activities
  3. Responsibilities and duties are assigned
  4. Authority delegation
  5. Coordination of activities
  6. Identifying positions and distinguishing them
  7. Reorganizing and reviewing

a) Defining the objectives: Organizations are established to accomplish certain goals. As a result, an organization’s long- and short-term objectives are essential. Long-term objectives should be supported by short-term objectives. It is important to set measurable, realistic, achievable, and attainable objectives.

b) Identifying and grouping activities Identification of activities: Identifying all organizational activities is the first step in organizing. Depending on the size and nature of the organization, organizational activities may vary. Among them are finance and accounting, production and operation, marketing and sales, human resources, and research and development. It is called departmentalization when related activities are combined and grouped into units or departments. Departments and units are divided into sub-departments or groups when related activities are grouped together. Specialization can be achieved by grouping activities. An organization’s needs should be considered along with the human factor, the nature of its activities, and the nature of its activities.

c) Responsibilities and duties are assigned: Different individuals are assigned responsibilities and duties according to their skill, knowledge, abilities, and aptitudes in this step. Everyone has a clear understanding of their responsibilities. The goal is to avoid duplication of effort and overlapping of work. Individuals are assigned specific jobs based on their qualifications and made responsible for their accomplishments.

d) Authority delegation: Each individual is delegated authority to perform the assigned duties effectively after duties have been assigned. You should delegate authority in proportion to the responsibilities you have been assigned. From the top of the structure down, delegation of authority establishes a clear hierarchy of authority.

e) Coordination of activities: Coordinating activities is part of organizing. In order to achieve a common goal, activities are arranged in an orderly manner. This ensures harmony and synchronization between different departments and groups. It is necessary to coordinate activities in order to prevent conflicts between employees and departments, duplication of work, and time and effort waste. Besides ensuring that all departments are doing their jobs, it also facilitates harmony between them.

f) Identifying positions and distinguishing them: It is also important to differentiate between line and staff positions when organizing. Line positions are those in the direct chain of command. Achieving organizational goals is its responsibility. Alternatively, staff positions provide line managers with expertise, advice, and support.

g) Reorganizing and reviewing: As internal and external factors change, the organizing process must be continuously reviewed and appraised in order to adjust or modify the organization structure.

Principles of Organizing

There are certain principles that govern organizing. The building blocks of organization are these elements.

  1. Specialization
  2. Functional Definition
  3. Span of Control/Supervision
  4. Chain of Command and Unity
  5. Unity of Goals/Objectives
  6. Responsibilities and authority are delegated
  7. Flexibility
  8. Exception
  9. Personal Ability
  10. Coordination and balance
  11. Efficiency
  12. Simplicity

a) Specialization: It is the principle of specialization that all work in an organization should be divided among employees according to their qualifications, abilities, and skills. It is possible to achieve specialization through the division of work.

b) Functional Definition: It is important to clearly define all the functions of an organization based on the principle of functional definition. A person’s duties, responsibilities, authority, and relationships within the organization must be defined. Organizational efficiency can be achieved through the clarification of authority-responsibility relationships.

c) Span of Control/Supervision: An area under supervision is referred to as a span of control. A single manager can effectively manage and control a given number of employees. An employee’s number under a manager should be determined according to this principle. Depending on the span, a wide or narrow decision can be taken.

  1.  Wide span of control: The manager is able to supervise and control a large number of subordinates at the same time.
  2. Narrow span of control: Managers in this situation supervise and control few subordinates under them.

d) Chain of Command and Unity: In an organization, the chain of command defines who reports to whom and links all individuals. Two principles underlie this: the unity of command and the scalar principle.

  1. Unity of command: According to this principle, each employee should have only one direct supervisor. There should be no more than one person reporting to an employee.
  2. Scalar chain: In an organization, the principle of scalar chain describes a clearly defined hierarchy. Each person in the organization should be linked by a clear and unbroken chain of command.

e) Unity of Goals/Objectives: Every organizational activity is geared toward achieving organizational goals that have been formulated for each level of the organization (top, middle and low) and each functional area. Everyone must understand and communicate the goals clearly. To achieve the goals effectively, all levels, areas, and units should support one another.

f) Responsibilities and authority are delegated: There must be a balance between authority and responsibility. It is the responsibility of the individual to fulfill the assigned task, which requires a certain level of authority. It is important that the tasks assigned are completed within the scope of authority. Performance will be poor if responsibility is not accompanied by authority.

g) Flexibility: There is a competitive, complex, and volatile environment in which modern organizations operate. It is crucial that they address the environmental impacts in order to succeed. Therefore, they should be flexible or situational. As environmental factors change, organizations must adjust their plans, policies, and structures.

h) Exception: Various activities should be performed by managers according to policies, procedures and rules of the organization. When dealing with complex situations or unusual circumstances, they may be exceptional. In this way, they are able to respond to situations promptly and enhance their ability to make creative decisions.

i) Personal Ability: The organization should always strive to improve the efficiency of workers at all levels according to this principle. Training and development programs can help achieve this goal. As a result, employee commitment and productivity are further enhanced.

j) Coordination and balance: An organization should have a good balance between its parts. It is important for an organization to develop its structure in a balanced way in order to maximize coordination. The centralization and decentralization of power must be balanced.

k) Efficiency: Efficiency is the basis of an organization’s operation. In order to achieve this, the organization must be operated in a cost-effective and efficient manner. In order to keep costs low, the quality of the product is not compromised. Through an effective organizational structure, human and other resources can be utilized effectively.

l) Simplicity : An organization’s structure should be simple in accordance with this principle. The simplicity of a structure makes it easy for all employees to understand. The duties and responsibilities of each person became clear to them. There should be less hierarchy and a clear line of communication in the structure.

Approaches to Organizing

Organizing can be divided into three major approaches. There are three types of approaches: classical, behavioral, and contingency.

  1. Classical Approach
  2. Behavioral Approach
  3. Contingency Approach

a) Classical Approach

According to the classical approach to organizing, there is one best way to manage an organization. The universal approach is also known as the universal approach. The scientific management, administrative management, and bureaucratic theories can highlight this approach to organizing. To minimize production costs and increase profits, scientific management theory advocates effective planning and controlling, modern machines and tools, and optimum utilization of resources. By utilizing modern tools and machines and paying workers properly, this theory aims to maximize workers’ efficiency. Employee development is achieved through training and development that maximizes the degree of cooperation between employers and employees.

Organizations are designed rationally according to administrative management theory. Power and authority are delegated to administrators through a formalized administrative structure. Providing a comprehensive framework for the study and development of management, this theory defines management as a series of functions including planning, organizing, staffing, directing, and controlling. Organizations that follow the bureaucratic theory must be structured into hierarchies and follow clearly defined rules and procedures. In bureaucracies, there are several aspects that promote decision-making, resource control, worker protection, and organizational success. The theory suggests that the organization should have a high degree of specialization, a clearly defined chain of command, and the principle of rationality, objectively and consistently. Each member of the organization should have a formal relationship based on their positions and governed by well-defined rules and regulations.

b) Behavioral Approach

The behavioral approach emphasizes the importance of behavioral and human factors in organizing. Maslow’s needs hierarchy theory, McGregor’s Theory X and Y, and Herzberg’s two-factor theory fall under this category. Using a five-step model depicted as hierarchical levels within a pyramid, Maslow’s need priority theory is based on human needs. It is necessary to address the needs lower down in the hierarchy before attending to those higher up. When organizing, he stressed the importance of these human needs. Theory X and theory Y were developed by Douglas McGregor. Management philosophy is based on Theory X. People want to avoid work as much as possible, which means they don’t want to take responsibility. Through financial incentives, people are motivated.

In order to keep them under control, rewards and punishments are the best method. The theory Y presumes that people are intrinsically happy at work, as opposed to theory X. The objectives motivate them to pursue them. Reward and punishment systems are unnecessary. People want to use their creativity to solve problems and are prepared to take responsibility for everything they do.

According to Herzberg’s two-factor theory, certain job factors lead to satisfaction while others lead to dissatisfaction. In order to describe job satisfaction, Herzberg used the term ‘hygiene and motivators’. In terms of hygiene factors, they include compensatory elements, job security, career development, the organization’s politics, working conditions, leadership quality, and relationships between supervisors and subordinates. A person’s intrinsic motivation includes a sense of responsibility, job satisfaction, recognition, achievement, and the opportunity to grow and advance.

c) Contingency Approach

Organizational contingencies state that management is situational. According to this theory, there is no perfect management style as management principles are not universal. By focusing on the multivariate nature of organizations, it enables them to cope with a variety of environmental conditions. According to the environmental conditions, it provides a framework for solving problems. Organizations must adapt to both internal and external environments, as well as fit between the two.

  1. Size of the organization: It is likely that larger organizations will have more hierarchies and units due to their size.
  2. Task and technology: It is also important to consider how much technology is used in organizing. Communicating patterns, job functions, employee relationships, and authority-responsibility relationships are governed by it.
  3. Environmental uncertainty: It is also important to consider how much uncertainty there is in the environment when organizing. A flexible structure is preferred when the organizational environment is volatile. Organizations that operate in relatively stable environments may be organized in a formalized manner.
  4. Individual differences: Organizational structure is also determined by individual differences in leadership. The authority of an authoritative leader tends to be centralized at the top.

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