Chapter -5
Organising
Organising
is a process of grouping different resources and bringing together for the
achievement of organisational objectives.
PROCESS OF ORGANISING
1.
Identification and division of work:
Organising process starts with the identification of work and division of total
work into smaller units according to skill and knowledge of employees.
2.
Grouping and departmentalization:
After division the next step is departmentalization i.e. grouping the similar
activities into one place and putting under on Department.
3.
Assignment of duties: After grouping
the similar works into specialised department the next step is the assignment
of duties to the departments according to their skill and qualification.
4.
Establishing reporting relationship:
This is the last step in organising process where managerial hierarchy is
developed and reporting relationship i.e. who will report who clearly defined.
ORGANISATIONAL STRUCTURE
Advantages and Disadvantages of
Formal functional Structure
Advantages
1.Specialisation: when the activities
are grouped according to the type of function then all the activities are
related one type only .So Specialised and professional expert can be hired to
supervise the activities .This leads to efficiency.
2 2.
Easy Supervision: The supervisor
becomes familiar with the type of function to be performed and as a result he
can supervise and guide the employees who are performing those activities.
3.
It helps in increasing managerial efficiency:
By performing the tasks again and again managers become specialised in doing
those tasks and improves their efficiency.
Disadvantages
1.
The Department become specialised in
their own way only and they fail to see the prospects of whole organisation.
2.
When the departments become too large
then co-ordination decreases and result in delay of decision.
3.
When the organisatioal goal is not
achieved then it becomes very difficult to make one department accountable
because all the departments are interrelated.
Advantages and Disadvantages of
Divisional Structure
Advantages
1 1. Product specialisation: All the
activities related to one type of product are grouped under one department only
which brings integration and co-ordination in the activities.
2 2.
Fast Decision making: The decision is
taken much faster in divisional structure because there is no dependence on
other departments.
3 3.
It become easy to make accountable
for non accomplishment of goal as there is no dependence on other departments.
Disadvantages
1 1.
Each department will require all the
resources as very division will be working as an independent unit.
2 2.
Each department focuses on their
product only and they fail to keep themselves as a part of one common
organisation.
3 3.
Conflict on allocation of resources.
DIFFERNCE BETWEEN
FUNCTIOANअ L AND DIVISIONAL STRUCTURE
Points
of Difference
|
Functional
Structure
|
Divisional
Structure
|
Basis
of Formation
|
It’s
formed on the basis of function.
|
Its
formed on the basis of product
|
Accountability
|
Difficult
to make one department accountable
|
Easy
to fix the accountability.
|
Economy
|
It
is economical
|
It
is not economical
|
Specialisation
|
This
structure brings functional specialiastion
|
This
structure brings product specialisation.
|
Suitable
|
It
is suitable for all types of organisation
|
It
is suitable for multiproduct organisation
|
Autonomy
of operation
|
Less
autonomy of action
|
More
autonomy.
|
DELIGATION OF AUTHORITY
In simple words we can
define delegation of authority as a process of assigning the decision making
power to the subordinates.
Process of Delegation
of authority (MARK 3)
1 1.
Responsibility: The process of delegation
begins when managers pass some of his some of his work to his subordinates.
2 2.
Authority: The next step in delegation
is the assignment of decision making power to the subordinates.
3 3.
Accountability: The last n final step
in delegation process is to make
answerable for non accomplishment of goal.
Importance
1 1.
Effective management: Delegation of
authority reduces the work load of managers as a result they can concentrate on
other important matters.
2 2.
Development of employees: Due to delegation
of authority employees get more opportunity to utilize their skills.
3 3.
Motivation of employees: Delegation
of authority creates the feeling of belongingness among the employees and this
feeling motivates them to give their best performance.
4 4.
Better co-ordination: Delegation of
authority brings effective co-ordination in the organisation as it gives clear
picture of work to everyone.
5 5.
Reduces the work load: By delegating
the authority a manager can reduce his work load and he can concentrate on
other activities.
CENTRALISATION & DECENTRALISATION
In simple words centralization
means concentration of decision making power in few hands i.e. Top Level
Decentralization
means distribution of decision making power at all level of management.
Point
of difference
|
Decentralization
|
Centralization
|
Meaning
|
It
refers to concentration of authority at higher level
|
It
refers to distribution of authority at every level of management.
|
Authority
at different level
|
Only
top level remains the authority
|
All
levels remains the authority
|
Suitable
|
It
is suitable for small scale organisation.
|
It
is suitable for large scale organisation.
|
IMPORTANT QUESTIONS
Delegation is necessary in every
organisation but decentralization is not necessary.Explaim
Ans. Delegation of authority is
necessary because with the help of it managers reduces their work load and it
also motivates the employees. But decentralization is required when the
organisation is growing and the top level management is not able to control all
the affairs.
1.
Name the network of social relationship that arises spontaneously due to
interaction
at work .
Ans:
Informal organization
2.
What is the type of organization where the decision making authority lies
with
the top management.
Ans:
Centralisation
3.
What is span of management?
Ans:
Number of subordinates that can be managed efficiently by superior.
4.
What is the form of organization known for giving rise to rumours?
Ans:
Informal.
5.
A company has its registered office in Delhi, manufacturing unit at
Guragaon
& marketing & salses department at Faridabad. The company
manufactures
the consumer products. Which type of organization
structure
should it adopt to achieve its targets.
Ans:
Functional organization structure.
6.
Name the function of management that initiates implementation plans by
clarifying
jobs & working relationships.
Ans:
Organising.
7.
In an electrical goods manufacturing company,there are 4 main
activitiesmarketing,
production,finance
& personnel. The general manager is
planning
to structure the organization. Which type of organization
structure
should be adopt and why? Give two reasons.
Ans:
In the given situation the general manager should go for functional
organization
structure. The reason for suggesting such an organization
structure
are:
a)
The firm is clealing in electrical goods which requires services of the
professtionally
trained experts, and b) All the activities of similar nature will be placed
under one wordinating
head,
this will facilitate specialization as well as standarisation.
8.
“If we delegate authority, we multiply it by two: If we decentralize it, we
multiply
it by many. Name the two concepts to which this statement is
related?
Ans:
a) Delegation of authority b) Decentralisation.
9.
“A Manager is of the view that he is not responsible for the quality of
work
that he has delegated to his subordinate.” Do you agree with his
view
point? Justify you answer by giving proper agreements.
Ans:
Hint: Statement is incorrect as the principle of absoluteness of
responsibility
is violated.
10.
A Manager revises the production target from 3000 kg per month to 6000
kg
per month. But the authority to purchase raw material was not given
by
the manager. Therefore, revised production target could not be
achieved.
Who is responsible?
Ans:
Hint: The Manager is responsible because responsibility has been created
without
granting authority. It violates the principle of parity of authority
and
responsibility.
11.
Kavita runs a factory manufacturing ready made clothes. The business
has
been doing well and she intends to expand the business by
diversifying
the business into ladies footwears, thereby keeping her
company
growing. Which type of structure would you recommend her
for
expanding organization? Give two reasons in support of your answer.
Ans:
She should adopt ‘Divisional organizational structure’ for expanding her
business
because of the following reasons:
i)
Product specialization enhances various skills in a divisional head .
ii)
Easy to fix responsibility and hold divisions accountable for their results
Q12)
the marketing manager of abha ltd an organization manufacturing motor
cycles
is asked to achieve a target sale of 200 motor cycles per day . he
delegates
the task to 20 sales managers working under him. Five of the
sales
managers could not achieve tneir respective targets. Is the
marketing
manager responsible? Explain in brief the relevant principal in
support
of your answer.
Ans)
yes the marketing manager is responsible for it.
Here
the principal of absoluteness of responsibility will apply.