Drawing on Selznick's writing in Leadership in Administration and related works, we characterize organizations as simultaneously technical entities pursuing economic goals and value-laden. Organizational theoryis a way to examine and analyze organizations more precisely and intensely based on patterns and trends in organizational design and behavior, which otherwise may not have been done (Daft, 2001). Analysis 9. Top management must explain the policies and programmes of the enterprise to the rank and file workers. Normally, the line of authority flows from the top level to bottom level. So, it is essential that the sequence of work should be arranged scientifically. 2. This guide accompanies the Organizational Types and Considerations for a Small Business PowerPoint Presentation. Co-ordination and integration ensure elimination of duplication of work and unity of action. Owner may be an individual or an individual family. 1. It then undertakes reorganisation to cope with the growing workload. What are these? Parts 14. 4. Specific policies, procedures and guidelines. In India the capital and labour a not at their mutual best. (PDF) ORGANIZATIONAL CULTURE ORGANIZATIONAL CULTURE Authors: Rasak Bamidele Landmark University Abstract The culture of an organization is influenced as the organization faces and learns. The work of one unit might have been commenced after the completion of the work by another unit. An organization requires constant caution and adaptability to effectively manage situations arising due to such factors. It will include the examination of the various types of relationships that develop within the organization. Allotment of duties to specified persons. Steps in Organisation Process 10. However, neither the interaction of these characteristics nor their role and importance for organizational competi - tiveness is properly examined in the literature. This is why it is said that organisation is a foundation upon which the whole structure of management can be successfully built. All factors of production are coordinated in order to achieve organizational objectives. Employees can develop a sense of belonging to the organisation. It should be taken without any prejudice and should receive wide acceptance. Need and Importance of Policies and Procedures: Policies and procedures are useful and important in the context of management of organisations. For other matters like company formation, registration, licenses, export, imports, foreign exchange rules/regulations, etc., policies, procedures, rules/regulations are issued by various departments of Government. 2. Internal organization is the structural framework of duties and responsibilities required of personnel in performing various functions within the company, it is essentially a blue print for action resulting in a mechanism for carrying out function to achieve the goals set-up by company management. The main desire of the key part is to garner autonomy so as to manage their units. Factory organization concerns itself primarily with the internal relationships within the factory such as responsibilities of personnel, arrangement and grouping of machines and material control. 3. Therefore, all the functions of the organisation must be of the nature that they may be executed easily and economically. Types of Policies, Procedures and Guidelines, 3. Steps in Organisation Process 10. The relationship amongst people is both vertical and horizontal. Procedure for dispatch, invoicing for sale of products, XIV. Organisation is one of the most creative art in the sense that it is concerned with getting work done through others by motivating them to work and coordinating their activities. (d) Huge Investment and Complicated Technology: Modern organisation involves huge investment and complicated technology, their management and operation is a complex affair. In other words, this analysis will help the managers to fix up decision levels of organization. 2. Organisation defines relationships amongst jobs and people working at the jobs at various levels. various types of organizational structures and factors that influence the structure for a given purpose. Besides, adequate staff members are appointed under the specified persons. 4. This website uses cookies and third party services. These senior members should delegate their authorities to their subordinates on the basis of their ability. Hecht (1980) suggested that "any organization is a complicated system of interactions . Process of Designing 18. To Economies the Use of Available Resources, 4. Defining and Assigning Activities to Jobs: Jobs must be clearly defined and the activities related to them must be clearly identified and assigned. Management functions Planning- Defining goals, establishing strategies to achieve goals, and developing plans to integrate and coordinate activities. It will be very difficult for a person to perform the duties effectively, if there is no authority to do it. Organising defines relationships amongst people through a process that aims to achieve organisational goals efficiently. 2. All human organizations are complex and one way of understanding their characteristics is through complexity theory. The objectives of the organisation may be achieved quickly whenever co-ordination exists among the workers. Providing authority, delegation, co-ordination and communication. The number of members may be increased or decreased according to the nature of work done by the subordinate or the ability of the supervisor. Each and every person should know who is his superior and to whom he is answerable. For example, the total activities in a manufacturing organization include acquiring materials, conversion of materials into finished goods, identifying and employing human resources, arranging finance, marketing and selling goods, ensuring quality, earning returns and so on. Prosperity to both is ensured by good, relations. Definitions of Organisation 2. 11. The activities of sales such as canvassing, advertisements and debt collection activities are grouped under one department i.e., sales department. In common parlance, the word organisation refers to institution. In the ancient times it was felt that the skills of organizing business cannot be codified and communicated. To Establish Healthy Relations between Labour and Capital: Human relations and behavioural sciences form the basis of any organisational structure today. The organisational set up should be arranged in such a way that a subordinate should receive the instruction or direction from one authority or boss. Everyone in the organisation must know as to whom he is accountable and his relationship with other persons in the organisation should be clearly established. Organisation is an instrument for realising the objectives, goals and purposes of the enterprise as a whole. The principles of organisation may be termed as a tool used by the organisation. Expansion and diversification tracks its course in the direction of the organisation structure. Thus, if a company has a control over the other company, this is known as a holding company. (c) According to C. L. Barnard-The function of an art is to accomplish concrete ends, effect results, produce situations that would not come about without the deliberate effort to secure them. Policies, Procedures, Rules other than Governments (Central and State) and its Departments: Policies, procedures and guidelines in the organisation other than Government and Government departments are prepared by the prescribed/fully empowered/delegated authorities of the organisations. The operators within this structure tend to professionalize, coordinate by standardization of skills, and structure the organization as a professional bureaucracy. Mutual dependence necessitates interaction and consequently adaptation. Joint stock companies are formed under the Companies Act. Hence, it is coordinates different activities for running the business enterprise efficiently so that the common goal can be achieved. 4. The management asks the organisation to accomplish the tasks set-forth before it which an effective organisation is capable of achieving through its fruitful organisational framework. Therefore the success of an organisation depends largely on how far it can promote the satisfaction of its members as individuals and as groups. Subsidiary company-A company is known as subsidiary company of another company, when the latter company has a control over the former company. Hence this principle only indicate to the fact that reasonably a decision should be in the best interest of the enterprise and personnels affects by such decisions. Before uploading and sharing your knowledge on this site, please read the following pages: 1. 3. Each person is responsible for the work completed by him. According to Northcott the purpose of organization is to co-ordinate the activities of various individuals working in the organization for the attainment of enterprise goals. 3. When many persons are working together in one place, there will be a difference of power and authority. In the context of management, it means formal arrangement of work amongst members of the institution with clear identification of authority and responsibility so that organisational goals can be achieved optimally. (ii) Grouping of work into smaller groups, (iii) Assigning work to every individual at every level in every department, (iv) defining its authority and responsibility, and. In other words, organization is simply people working together for a common goal. organizations because this mode of thought provided the most effective and efficient way of attaining particular goals. If duties of every member and their relationship with peers, superiors and subordinates are not defined, the planning process will be ineffective. It should be open and should pass through a democratic process if permitted by the prevalent circumstances. From the above it is abundantly clear that Simon gives greater importance to decision-making process. There Must be Perfect Co-Ordination in All the Activities of an Organisation: Co-ordination is the essence of management. Return on investment goes up ultimately leading to larger savings. Element # 5. (h) Interaction with Other Systems is Also Must: All systems are interdependent and exert influence on others and are influenced by others. It also indicates the organisations hierarchy and authority structure and shows its reporting relationships. Organisation helps in division of work into related activities so that they are assigned to different individuals. So, business organisation is an art in so far as one has to use his skill and knowledge in solving many complicated problems of business to achieve the enterprise objectives. Proper Utilisation of Resources be Made: Success of a business and industrial enterprise depends to a large extent on the proper utilization of resources. 4. Who Makes the Policies, Procedures and Guidelines? Social, political, economic and legal factors exert influence on the environment. 2. This refers to very purpose of analyzing the purpose of existence of organization. Account Disable 12. The organisational set up should be flexible to adjust to the changing environment of business. Its principles cannot be considered as fundamental truths. Human Psychology and behaviour form the fundamentals of Simons principles of organisation and it is here where it differs from the traditional organisation approach. An autonomous corporation/enterprise/organisation. Science has three basic important features: (a) It is a systematized body of knowledge that uses scientific methods of observation. Leave nothing but our organisation, and in four years we shall have re-established ourselves. Every word of Carnagies thundering is important. It includes the deciding and division of various activities required to achieve the objectives of the organisation. In another sense, each boss should know what authority he has and over which person. There are many relevant points relating to these policies, procedures and guidelines, which are necessary to discuss and explain. It is often achieved with the help of organisation charts. As these are pre-determined and declared duly approved by the competent authorities, these are to be followed and implemented without any questions and clarifications by anyone in the organisation. Objectives 7. It will result in the non-completion of any work. The above definitions highlight organising as a (i) structure and (ii) process. The next step is to group the various activities into practical units based on similarity and importance as well as to indicate the person who would do the work. It Must be Helpful in the Achievement of Objectives: A good organisation must be capable of overcoming the problems of an enterprise. In certain periods, some sections or departments are overloaded and some departments are under loaded. Procedure for contracts finalisation, i.e., contracts manuals, guidelines, procedure for contract closure, etc. Similarly any commercial undertaking aims at a reduction of its operating cost. While delegating a authority, responsibilities are also fixed. The work should be completed with minimum members, in less time, with minimum resources and within the right time. To Establish Healthy Relations between Labour and Capital, Essential Elements of a Good Organisation. Rules and regulation for the earned leave, half pay leave, leave encashment, medical assistance, other perquisites, gratuity payment, final settlement of employees. All the groups or departments are requested to co-operate to attain the main objectives or in implementing major plan of the organisation. Simon's Theory 17. Ten Characteristics of an Inclusive Organization It accepts diversity and inclusion as a way of life. This is why he lays stress on three fundamental points (principles) in preparing the structure of an organisation. A public sector company on the contrary is different from the private limited or public limited company under the private sector. If a complicated problem arises more than one member examines the problems and takes the decisions. Report a Violation 11. Policies, Procedures Related to Government: Regarding Government dues, duties, taxes as brought out earlier, policies, procedures, rules, regulations, guidelines are issued by Government Central, State including Government departments, as also Municipal and local bodies. These relationships are Vertical, Lateral and diagonal. (ii) They help in resolving the differences of opinion, as these are already approved policies and procedures, there will be no dispute and difference in carrying out a job by anybody. It provides co- ordination. Therefore, for almost all the areas of activities in the organisation, policies and procedures are made for proper and smooth functioning. The overloaded sections or departments can be further divided into sub sections or sub-departments. Business organisation is a science as it is an organized body of knowledge built up by management practitioners, thinkers and philosophers, over a period of years. Organisation is the executive structure of an enterprise and a basic framework within which the executives decision making behaviour occurs. Direct supervision When one person supervises the work of others, as in the case of an entrepreneur in a small start-up who supervises his/her workers directly to achieve the objectives thus, acting as the main and only link to achieve coordination. In case of an expert or specialist advising a manager at the same level, the relationship is lateral. Alike management the term organization has also been defined in a number of ways such as a process, as a structure of relationship, as a group of persons and as a open dynamic system and so on. III. Thus, the modern organisation is an ideal co-ordination of the functions of a number of people for attaining the mutually agreed purposes through a well-defined system of working, i.e., hierarchical levels, chain of command, rules and procedures and communications and through the principle of division of labour. For achieving the objectives and goals of a business concern, the functions and tasks involved in the enterprise should be grouped in such a manner that active consultation and co-ordination can take place with a minimum of over lapping, delay or confusion. A chain of systematic division of labour takes place by assigning authority and responsibility to an individual who is supposed to be specialized in the job and this leads to differentiation. Policies, Procedures, Guidelines 19. Organising as a structure is a network of relationships (authority-responsibility structure) amongst all those who are part of the organisation, working at different levels in different departments. While delegating the authority, there is no need of delegation of responsibility. Jobs are described sharply, and so confusion in the organisation and duplication of efforts are avoided. relationship. In the absence of unity of command, there is no guidance available to the subordinates and there is no controlling power for the top executives of the organisation. Organizational structure is the arrangement of people and tasks to accomplish organizational goals. characteristics should have no bearing on one's interaction with a bureau-cracy and the outcomes it produces. Employees Satisfaction is Essential: An organisation can be regarded as good and efficient if it satisfies its employees because it will increase the morale of its employees and they will be encouraged to do more work for the success of the enterprises. Organizing - Arranging and structuring work to accomplish organizational goals. At the same time each work can be done effectively by having co-ordination. Broadly, there are following types of organisations: a. In other words, organization is simply people working together for a common goal. Proper organisation facilitates the intensive use of human resources. Terms of Service 7. Whereas in the case of public limited company, there are no restrictions for selling of its shares to the public and its number of shareholders can be any number for which the company has been registered and permitted under the Companies Act. Even if the price of the commodity is not reduced due to some reason or the other; the quality improves, the workers get more wages and the profitability increases. Decision: Meaning, Types, Elements and Nature | Organisation, Sales Organisation: Meaning, Characteristics, Importance, Design, Types, What is Organisation: Definitions, Characteristics, Functions, Principles, Advantages, Problems and Other Details, What is Organisation Definitions by Eminent Thinkers, What is Organisation Meaning and Concept of Organisation, What is Organisation Scope of Organisation, What is Organisation Different Characteristics, What is Organisation Nature of Organisation and Nature Business Organisation, What is Organisation 4 Important Objectives, What is Organisation 9 Essential Elements of a Good Organisation, What is Organisation 7 Important Steps Involved in Organisation Process, What is Organisation 7 Requirements of a Sound Organisation, What is Organisation 6 Main Functions of Organisation, What is Organisation 22 Important Principles of an Organisation, What is Organisation Analysis of Organization: Activities Analysis, Decisions Analysis and Relations Analysis, What is Organisation Parts of an Organisation: According to Henry Mintzberg (With the Coordinating Mechanism), What is Organisation 6 Important Types of Organisations, What is Organisation Importance of Organisation, What is Organisation Simons Theory of Organisation (A Modern Approach), What is Organisation Process of Creating an Organization, What is Organisation Policies, Procedures, Guidelines for Functioning of Organisations, What is Organisation Problems of Organisation. Therefore, as far as possible decisions should be laudable and foolproof. It would entail in the effective control over all the organisational activities. But now, it has been realised that the principles of business organisation may be codified and communicated. The key parts of an organization are as follows: The operating core consists of operators who perform the main work directly related to the production of goods and services. These, functions are organized in the form of departments. These companies have many restrictions on its managers who have to work strictly under the rules and regulations laid down by the Government. Such a division of function on specialty basis infuses specialisation. This brings in division of labour. Each work can be completed efficiently wherever the climate or the organisational structure facilitates the completion of work. The simplicity of the organisational structure enables the staff members to maintain equality and homogeneity. characteristics of the organization, the diagnostic procedures, all the concepts and principles those are necessary for organizational change, types of changes and the functions of organization . There must be mutually agreed purpose because all activities in an organisation are goal-oriented. It allows, therefore, management by exception and avoids management by crisis. In the absence of complete information a sound decision cannot be taken. It also indicates the authority and the responsibility assigned to individuals charged with the execution of their respective functions. While an organisation ought to be fairly stable over a long period, it must contain within itself, the elements of growth and expansion. It will avoid the problems of dual subordination or conflicts in the organisational set up. Meaning of policies, procedures and guidelines, 5. It means there must be well defined hierarchical levels, a chain of command, rules and procedures and communication network, so that consistency and uniformity in behaviour may exist. This will help to fix up the right man to the right job and reduce waste of time and resources. Span of control refers to the maximum number of members effectively supervised by a single individual. The objectives of the enterprises are realised more easily where there are good chances of the achievement of such personal goals. The entire work is divided into various parts and again each part is sub-divided into various sub-parts. (a) In any activity that is classed an art the emphasis is an applying skills and knowledge and accomplishing an end through deliberate effort. T. L. Massie, (b) Art is bringing about of a desired result through application of skill. Division of labour The work needed to accomplish the goals is divided into a number of functions and sub-functions. Proprietary means that besides it being owned by the single owner, it holds a single source of supply for the particular product or service. So that proper control may become possible at all levels of management. Excellent is a relative terms hence remain insignificant in any sense of the term it is being used. The main part of such organizations is the middle line and the main coordinating mechanism is standardization of outputs. . Organisation A Decision Making Process: Simons organisation is decision-making structure. Different authors have defined organisation as follows: Organisation 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 A. Allen, Organisation defines the part which each member of an enterprise is expected to perform and the relations between such members, to the end that their concerted endeavour shall be most effective for the purpose of the enterprise. Alwin Brown, Organising is a process of defining the essential relationships among people, tasks and activities in such a way that all the organisations resources are integrated and coordinated to accomplish its objectives efficiently and effectively. Pearce and Richard B. Robinson. It also establishes the line of communication. In its broadest sense organisation refers to the relationship between the various factors present in a given endeavor. Beside it is influenced by internal factors like materials, machines, level of technology, economic resources, human resources, etc. The primary desire of the key part is to increase its influence. The final objective of all organisations is to get smooth and effective co-ordination. Types 15. Of these persons, some will rule and others will be ruled. When mentioning the HPO topic, the American Management Association ( 2007) states that an HPO is an organization with accomplishments in excellent management in various aspects, in which such. Importance. c. These policies, procedures, guidelines are made by competent authorities including government departments and officials empowered to do so. How confident he was about his managerial skill and organisation structure. The All the activities of the organisation should be framed in such a manner that all the employees may contribute their efforts in their execution. Social gain should be the main aim of any organisation. Work process standardization The work process standardization itself can promote coordination between different units as is exemplified, for instance, in the process of an assembly line. The work of each and every person is defined and authority and responsibility is fixed for accomplishing the same. Further, some subordinates will have to do more work and some others will not do any work at all. Investors will also have confidence in the enterprise. Simon believes that decisions affect the working condition and zeal of a human being assigned to do a particular job. Organisation is developed for people. For example, lecturers in a university or assembly line workers in an automobile plant would constitute the operating core of an organization. Employees State Insurance Contribution, xiii. Co-operative societies are formed under the Co-operative Societies Act. There is a difference between the private limited company and a public limited company. (f) Proper System of Working in All Organisations: There must be proper system of working in all organizations. taking an important step to building a better business. For example, in an operation theatre of a hospital, the anesthetist, the surgeon, and the staff nurses coordinate to complete the operation successfully. Mines lease and royalty payment rules. He discards the traditional approaches so the problems of organisation; He firmly believes that we have to develop new thinking conduct researches and formulate principles a fresh for development and progress. During this period, due weightage should be given on the basis of the new work load. The chief component in this organization is the techno-structure and the main coordinating mechanism is the standardization of work processes. 5. The activities of the different departments or sections may be different in nature and in approach, but these should be concentrated only for achieving the main objectives. 3. Advantages 20. There must be harmonious adjustment in different activities of the organisation. Academia.edu no longer supports Internet Explorer. The primary objectives of a business organisation are always those of economic values with which we serve the customer.. Each sub-plan is taken up by a particular group or department. 16. Thus, the Production Manager may be delegated with the authority to produce the goods and fixed with the responsibility of producing quality goods. physical factors of good work environment. The co-ordination of various activities. Should be given due weight. The mechanism must be such that it can adapt itself, to changing circumstances. There are four basic elements of all forms of living organisations around which any organisation centers (i) The work (ii) The People, (iii) The authority, responsibility and (iv) The relationships. In certain cases, the subordinates are motivated through the delegation of authority and they perform the work efficiently with responsibility. A Public Limited Company or a Private Limited Company or a Public Sector Company: Simons Theory of Organisation (A Modern Approach), (iii) Excellent Decision is no Substitute to a Satisfactory Decision, Policies, Procedures, Guidelines for Functioning of Organisations, 1. A Sole Trader or a Trading or a Proprietary Firm: This type of organisation is owned by a single owner. The expansions of business activities require some changes in the organisation. It is a group of people assembling or congregating at one place and contributes their efforts to achieve a common goal. Problems. The establishment of authority relationships with provision for co-ordination between them, both vertically and horizontally in the enterprise structure. Copyright 10. Mark Carnagies leave nothing but our organisation. 5. An organisation is considered as good only when it is capable in achieving the predetermined objects of enterprise. The flow of information must be quick, easy and two-way. Further, there must not be the repetition of activities. Organisation, as an element of management, is concerned with the following aspects, called as scope of organisation: 1. It must create, maintain and develop its own image or individuality. Besides, it increases co-ordination among the officers. The organisation should make the work distribution in such a manner that there should be an equal status and equal authority and powers among the same line officers. Information is to organisation is what headlights are to a driver and lighthouse to a sailor. are all examples of adhocracy structures. Some types of organisation augur well for the small company in its infancy; however, with the advent of growth and diversification these structures may prove inadequate. Managing Director or a Director with delegation of powers by the Board of Directors. Authority and responsibility should be in parity with each other. The key part in this type of structure is its operating core and the main coordinating mechanism is the standardization of skills. Organisation is the process of identifying and grouping work to be performed, defining ad delegating responsibility and authority and establishing relationships for the purpose of enabling people to work most effectively together in accomplishing objectives. In the words of Allen, organization is an instrument for achieving organizational goals. A security agency, national post office, a steel company, a custodial prison, national railways, etc. Content Filtration 6. Element # 3. Organisation structure is the result of organisation process. Element # 8. An organization is a collection of people working together to achieve a common purpose. 3. 1. 3. Similar activities should be grouped together under one heading, For instance purchasing, machining, assembling may be placed under manufacturing while recruiting, training, job grading, compensation may be placed under personnel, Other basis for grouping the activities may be utilised such as geographical location, particular equipment utilisation or process to be employed. The junior officers are disturbed by the seniors only when the work is not done according to the plans laid down. Once this is known, the manager will be able to find the activities required to accomplish desired goals and group them in an order, hand over each department to suitable and capable person and delegate the authority, so that everybody work to get the desired objective. You can download the paper by clicking the button above. Society needs goods at proper time, of standard quality, in adequate quality, at a cheaper rate and regularly. (i) Policies and procedures indicate the directions for doing the jobs. Environment No organization is functioning in a vacuum. Decisions may be the best or may be not the best but it must be satisfactory and based on sound judgement. Allotment of Duties to Specified Persons: In order to ensure effective performance, the grouped activities are allotted to specified persons. The organisational task is divided into units, people in every unit (departments) are assigned specific tasks and their relationship aims to maximise organisational welfare and individual goals. Holding Company and Subsidiary Company: 6. As vertical relationships, the authority-responsibility structure of people at different levels in the same department is defined and as horizontal relationships, authority-responsibility structure of people in different departments at same levels is defined. This alone will ensure job satisfaction. Holding Company and Subsidiary Company: Holding company has a control of the management of the subsidiary company. The required training may be provided to the needy persons. It needs assistance from specialists at all levels. Elements 8. 4. Without a good organisation, effective administration becomes impossible. Labour related rules including gratuity act, xix. Secrecy should not shroud it. There are certain advantages and disadvantages in case of both the types of companies. Specialisation in different activities is necessary to improve ones efficiency. Enter the email address you signed up with and we'll email you a reset link. Organisation structure and process are not independent concepts. The key part in this type of structure is the strategic apex that tries to centralize and control. Prohibited Content 3. For this reason also-economic use of available resources is desirable. A developing country like India can ill afford this situation. Thus, a manager must, know the legal constitution/entity of organisation to which he/she is associated for employment. An emerging multidimensional approach to organizational design outlines the need for the alignment of relevant structural and process characteristics of organizations. 5. For example, general managers, deputy-general managers, divisional managers, factory heads, managers, etc. organizations benefit someoneeither the management, the membership, the client, or the commonwealth. In another sense, if responsibility is delegated without the authority, it is a dangerous one. Specific Policies, Procedures and Guidelines: As has been stated, policies and procedures are the fundamentals and principles for the conduct and performance of the tasks of the organisations. To accomplish these, there are laid down policies, procedures, rules and guidelines. Simon has emphasised in his Administrative Behaviour that management principles are helpful in decision-making process. These policies and procedures provide direction to proceed to reach the final destination i.e., accomplishment of jobs, which are all centered towards achieving the main objective of the organisation. (d) The Principle of Parity of Authority and Responsibility, (h) The Principle of Functional Definition. Personnel manual and various employee related policies and procedures, XI. The main desire of the key part is to maximize their autonomy. Further as per Mintzberg (1979) there exist five types of mechanisms employed by the organizations to coordinate their various activities. Type # 6. As regards, the internal policies and procedures, it is stated that these are prepared by the organisation itself in respect of various functions with a view to perform the activities and perform the same smoothly. ADVERTISEMENTS: 11. It is exercised for common good and not for safeguarding the interest of an individual, Great care is to be taken before exercising ones authority; Authority, if not acceptable to those who are to abide by the authority, carries no meaning. While allocating duties to the persons, the extent of liabilities of the person would be clearly explained to the concerned person. Similar to these policies and procedures pertaining to a manufacturing organisation, there may be policies and procedures identical or suiting to the organisational needs in respect of banks, insurance companies, construction companies, marketing and trading companies, consultancy organisations, etc. If the resources are not properly utilized, the business enterprises cannot be successful. The organisation should have such a communication system which would pass on all relevant informations to all concerned so that decision-making become easy and acceptable process. Robert H. Miles. Peter Duckers recommends three types of analysis. The support staff tries to coordinate by mutual adjustment so as to structure the organization as an adhocracy. Based on the relationship defined, titles are given to employees. Where a specialist exercises authority over a person in subordinate position in another department in the same organization, it is known as diagonal relationship. However, the decision at middle or lowest level affects only those who are concerned with these decision. Employees who are given responsibilities should be made accountable to his superior for the use of authority and work performance. Sorry, preview is currently unavailable. Organizing is the establishing of effective authority relationships among selected work, persons and work places in order for the group to work together efficiently. Base Social Needs and Human Psychology: Professor H. A. Simon based his theory of organisation on 1. social need, and 2. human psychology. For example, the purchase work may be divided into requisition of items, placing of an order, storage and so on. change the behavior of the organization through mindset and attitude change in individuals within the organization; and, finally, they help to integrate sustainability thinking into the culture of the organization. Step # 6. External factors include politics, countrys economy, and legal rules and regulations; whereas internal factors include plans, objectives, and policies of an organization. It must enable the management to maximise the outputs through provision of an efficient man-machine system. Simons Theory 17. Overall financing policy for debt and equity ratio, IV. Organising refers to the grouping of activities necessary for the attainment of objectives. Where a superior subordinate relationship envisaged it is vertical relationship. The objectives must be determined keeping in view the environmental situation. If the organisation deviates from this goal certainly it is not going to stand benefited for a longer period since it is the society which helps an organisation, management and enterprise to grow in structure. A general hospital, a university, public accounting firms, and social work agencies are all examples of organizations that follow the structure of a professional bureaucracy. Importance 16. In the words of R. C. Davis, the mission of the business organisation is to acquire, produce and distribute certain values. In Wheelers view, organization is a process of fixing duties and responsibilities of persons in an enterprise so that organizational goals are achieved. Rules and regulations Every organization is governed by a set of rules and regulations for the orderly functioning of people. Industrial or business organisations are set up as a legal entity under the rules and regulations for companies, partnership firms, etc. In the administration area, under one executive, nearly four or five subordinates may work. Need and Importance of Policies and Procedures, Policies, Procedures Related to Government, Policies, Procedures, Rules other than Governments (Central and State) and its Departments, Major problems in running an organisation are indicated. Finance/funding Various rules/procedures by banks, Reserve Bank of India. Assignment of duties or allotment of duties to specified persons is followed by delegation of authority. Mutual adjustment This method of coordination can be achieved only when a degree of informal communication happens between different functional experts in a project team. Principle of Specialisation or Division of Work: Division of work means that the entire activities of the organisation are suitably grouped into departments or sections. Organisation is the backbone of management because without an efficient organization no management can perform its functions smoothly. Goodwill is a gift given by the society to the enterprise and on its own will the society can withdraw it even without a moments notice. Some experts like Taylor, Fayol and Urwick have given the principles of organisation. However, grapevine communication is also in vogue. 1. (ix) The policies and procedures become a basis for further improvements, modifications. Under this step, the individuals working in each and every department are assigned work in terms of their specialisation. The decision-making and its implementation become easy when communication are acceptable to all concerned without any reservation. He has advocated that principles are not important as the traditional or classical thinkers believe but in our approach which is an important factor in making the organisation dynamic and responsible. This has given the concept of business organisation as a science. For example, person put in charge of materials should be allowed to spend money to identify the sources of supply, to get the materials delivered to stores, to negotiate better terms for the company, to inspect the quality, protect the materials from damage, etc. To effect economy in the whole organisational structure is a main task of an organisation economy affected results into cheaper availability of goods to the ultimate consumer. That is objective of the organization. To Economies the Use of Available Resources: Though in India men are in abundance and other resources are scarce. Skills or knowledge standardization Often the qualifications, training, and experience of the personnel may act as a major source of coordination in an organization. The main desire of the key part is for collaboration and innovation in decision-making. They must be clear, precise but complete and free from ambiguity or confusion. To achieve the following objectives a company sets up an organisation: Any company aims at reducing its cost of production. It should be live to the role which an organisation is required to play in preparing a dedicated sincere and responsible working force. In case of a private limited company there are certain restrictions that the company cannot go for public selling of its shares. Principle of Simplicity and Homogeneity: The organisation structure should be simple. At the same time, if authority alone is delegated without responsibility, the authority may be misused. The firm that grows beyond the scope of its existing organisation finds itself in a serious administrative crisis. Each person should be assigned specific job or jobs and be made responsible for it. These companies are subject to the regulatory authority such as SEBI, if their shares are listed on a stock exchange. In short, organizing is the determining, grouping and arranging of the various activities deemed necessary for the attainment of the objectives, the assigning of people to those activities, the providing of suitable physical factors of environment and the indicating of the relative authority delegated to each individual charged with the executio. The strategic apex, in order to centralize and coordinate by direct supervision, structures the organization as a simple structure. 4. 2. This type of company is under the 100% control of State or Central Government. Creating Organisational Relationships: Creation of different authority relationships such as line, functional or line and staff is essential for the achievement of the objectives. Thus, the important aspects related to these are outlined as under: 1. Chairman/Chief Executive/President of the Company. Principles 13. 8. Group It is people who constitute the dynamic element of an organization. Process of Designing 18. In organisation the total work of the enterprise is divided into activities and functions. As far as possible decision making process be made a routine job. 3. The process of creating an organization includes: The first and foremost step in organizing is to estimate and determine the total activity required for realising the objectives of the organization. Therefore every division, branch, department and section as well as the entire organisation must be tuned to the objectives and must contribute to their realisation. So, the success or failure of an organisation depends upon the principles to be followed in the organisation. Partners will be two or three or more with the agreed proportion of their ownership and investments. It will result in attaining specialisation in a particular work or area. In an inclusive organization, one sees diversity at every level within the institution. Scope 4. An organization is influenced by many external and internal factors. If the activities of an enterprise are not co-ordinated, the achievement of the objects of enterprise cannot be thought of. 4. It is the structural framework of duties and responsibilities required of personnel in performing various functions with a view to achieve business goals. It is necessary to define and fix the duties, responsibilities and authority of each worker. If there is any need, appropriate training would be provided to such persons. The next function of organisation is that the identical activities are grouped under one individual or a department. A job must be allotted to a properly qualified person so that none becomes a square peg in a round hole. This is also called chain of command or Line of authority. For efficient accomplishment various activities are assigned to different persons. The middle management tries to group together the organization, with coordination restricted to the standardization of outputs, to structure the organization as a divisionalized form. The work can be completed in time whenever a technique or a principle is adopted. Policy be Such Which Can be Executed Easily and Economically: An organisation system can be regarded as good and efficient system, if the system can be easily understood and implemented. Nature 6. Delegation of Required Authority: Proper authority must be vested in the personnel to enable them to carry out the job. Providing facilities and equipment, i.e. It must, therefore, be humanistic also and not merely mechanistic. How to distribute power and authority? A business organisation has to be dynamic in character in this changing work environment. An effective organization (1) makes the management simple and efficient, (2) encourages specialisation, (3) improves techniques, (4) encourages constructive thinking, (5) increases productivity, and (6) accelerates the progress. These authors view organization as a coordinating point among various persons in the business. Different departments within an organization control particular forms of standardization in the organization. 6. From the standpoint of the enterprise as a whole, organization is the structural relationship between the various factors in the enterprise. The business objective, therefore, is the starting point for business thinking. Before discussing business organisation as an art it is essential that we must know what is an art? Facilitates Growth and Diversification: The organisational structure is the framework within which the company grows. 7. Similarly person in charge of maintenance should be authorized to buy spares from various sources, periodically inspect the condition of machines, determine optimum speed of machinery, service the machines, ensure safety of machinist, etc. We have to find out some way out for better relations and effective achievement of the objectives of the company. At the same time, its number of shareholders cannot be more than 50. As regards internal policies and procedures, it is stated that internal policies, procedures, guidelines are made with the approval of the competent authority covering all the functions, where there is no external policy, procedure involved. For example, transportation department, canteen, security services unit, etc. Thus, these policies, procedures and guidelines are pre-determined written and approved rules, regulations, and manuals for conducting the business transactions of the organisation. Hence, his behaviour before a decision is taken. Organisation is the process so combining the work which individuals or groups have to perform with the facilities necessary for its execution, that the duties so performed provide the best channels for the efficient, systematic, positive and coordinated application of the available effort. Employees who are assigned duties or responsibilities cannot be expected to perform unless adequate authority is delegated to them to translate the responsibility into reality. This refers to all other departments/units that exist to provide support to the organization outside its main work area. Any organisation aims at (i) service of the society, and (ii) service of the enterprise of which it is one of the part. Once the organisation process is defined, organisation structure is the end result or outcome of that process. Superiors ensure that subordinates do the duties as assigned and do not misuse the authority. learning organization is a group of people who have wicker a constant, enhanced ability to learn into the corporate culture, an organization in which learning processes are analyzed, screened , build up, and united with set aims and goals. Element # 2. The essential and important elements of a good organisation are as follows: Element # 1. A Public Limited Company or a Private Limited Company or a Public Sector Company: The organisation may be a public limited company or a private limited company or a public sector company. It has developed certain principles and rules after continued observation. Meaning and Concept of Organisation 3. The ownership is with the Central or State Government. An effective and fruitful organisation also aims at a reduction on cost of production, distribution or operation to justify its very existence. A Ministry concerned in case of a public sector organisation in case of certain policies, procedures not delegated to the Board of Directors of the public sector organisation. Outputs standardization This happens when, for example, finished product or service specifications and standards act as means of coordinating work as the concerned departments have to coordinate till the output meets the specifications. He believes that behaviour of the some individual cannot remain static in all the circumstances hence sticking to principles of traditional nature would not help the management to grow in stature and progress of the enterprise may then not be as satisfactory as it is planned and expected. Three terms need to be clarified at the outset. By introducing clear- cut accountability, it paves the path for achievement motivation for the professionals and specialists. 3. They are complementary to each other. To browse Academia.edu and the wider internet faster and more securely, please take a few seconds toupgrade your browser. Provides Optimum Use of Technological Advances: Technological advances exert a great influence on organisational structures and the heavy fixed costs of such equipment calls for proper organisation. For example, a companys board of directors, its CEO, and VPs would constitute the strategic apex, primarily responsible to the companys various stakeholders. At the start, to create a new organisational system; Major problems in running an organisation are indicated below: 1. Therefore, an art is a system for the attainment of a given end. Communication There is free flow of communication through various official channels among the people across various departments. (i) That organisation is a difficult decision-making process, (ii) That human behaviour is an important instrument with the help of which organisation achieves its objectives, and. The following are the different characteristics of an organisation: (a) Modern organisational is too large in terms of number of people in employment and in terms of the amount of investment. The main coordinating mechanism is direct supervision. The later must also be given the opportunity to convey their feelings, reaction and grievances to the former. The various activities identified in the earlier step are grouped on a logical basis in the form of departments like materials management, production, marketing, finance, human resources, product development, quality control, finance, etc. How to ensure effective adaptation to changes in the environment? If it is done, each person will know who is his boss, from whom he has to receive orders and to whom he is answerable. The particular product may have a unique quality and other technical parameters, which may not be available from others. Organisations must, therefore, adapt themselves to technological changes in the environment. It must ensure smooth and effective net-work of communication and information. 5. This is also called the principle of co-ordination. (c) The principles are exact and have universal applicability without any limitation. (viii) They help to adopt a right method of doing the things. Dimensions and Characteristics of Organizational Behavior: Impact and Competitive Advantage Authors: Jose Prabhu Joseph John Management and Engineering Colleges The study of organizational. Organization is the adjustment of various activities for the attainment of common goals. Based on his study and generalisations Simon later gave the following five principles of organisation: Though every decision cannot suit each individuals (neither the decision are acceptable nor are suitable in all the circumstances) but decision should reasonably the sound and appropriate to the circumstances in which it has been taken. It emphasises more on positions than people. Similarly persons employed in inventory department may be assigned responsibilities like identifying source of supply, inventory maintenance, material issue, quality control, storage of materials and so on. 2. Defining and Assigning Activities to Jobs: 7. Objectives Identify general characteristics, advantages, and disadvantages of each of these organizational types for small businesses: Sole proprietorship There are several members in the society and managers are appointed to run the business transactions of the society (the organisation). Element # 4. If this happens because of non-judicious and un-planned use of resources then future generation is not going to forgive us. Hence, it is coordinates different activities for running the business enterprise efficiently so that the common goal can be achieved. Direct contact between employer and employee is not possible in modern organisation. In the words of Keynes Science is a systematical body of knowledge which establishes relationship between cause and effect. Image Guidelines 4. At this point, however, it is impor- . Our approach should be to make the organisation a decision-making structure in which day-to-day happenings should also be taken note of and incorporated. He has concluded the principle of management and organisation are ambiguous and sometime contradictory. Unless the manager or supervisor knows the objectives he may not be able to organise properly and motivate people towards the attainment of the objectives. How to develop mechanism capable of reducing intra-organisational conflicts? 20. In the management process this organization stands as a second state which tries to combine various activities in a business to accomplish pre-determined goals. The number of sub-ordinates over whom control is to be exercised at each level of management should neither be so large as to be unwieldy nor too small for the effective performance of the work or fuller utilisation of the managers ability to control. It is not in a position to achieve these objects; it cannot be regarded as a good organisation. Characteristics 5. There are several units functioning separately under one organisational set up. The arrangement by which tasks are assigned to men and women so that their individual efforts contribute effectively to some more or less clearly defined purpose for which they have been brought together. Investment decision-making and approval Project financing, II. 3. A good organisation has to fulfill four special functions: 1. Nature of Organisation and Nature Business Organisation, 3. The Similarly, these are to be accepted by the outsiders also. Thus, organisation is a Soft Science or Behavioural Science. Step # 2. In the business organisation, there are number of decisions taken by the officers to run the business. (vi) Therefore, functioning becomes easy and without any hindrance. Simons principles of organisation, therefore, are principles of decision-making in true sense of the term since his approach to the organisation is not that of classical but is modern one, it is based on the thinking that function of an organisation is only to take decision on one matter or the other. These relationships can usually be diagramed in the form of an or ganization chart. Once A. Carnagie, a famous American industrialist said, Take away our factories, take away our trade, our avenues of transportation, our money. Most of the times it makes a greater sense to outsource these specialized services. The specified persons are specialised in their respective fields. Educational institution, a private agency, Government department or business firm; all are organisations. Some authors are of this opinion that in nature of business organisation we may discuss whether business organisation is an art or a science. Contrary to the sole trader and trading house, a partnership firm is owned by more than one owner. Organisation structure specifies division of work and shows how different functions or activities are linked; to some extent it also shows the level of specialisation of work activities. XV. Transport through external agencies including railways, xiv. Le prsent document dsosse les caractristiques d'une organisation efficace en examinant, dans le contexte de la thorie contemporaine de l'organisation, les propositions pour le sabotage organisationnel contenues dans Simple Sabotage Field Manual, publi par l'Office of Strategic Service en 1944. Uploader Agreement. Inspection of boilers, electrical connections, etc. Elements 8. (v) Establishing relationships amongst people to make them contribute towards organisational goals in an integrated manner. Co-ordination among various activities of a department and of the organisation is necessary for the harmonious functioning of the organisation.
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