TOPIC: ORGANIZING
Completion requirements
Specific Objectives
By the end of this sub-module unit, the trainee should be able to:
a) explain the nature and purpose of organizing
b) outline types of organization structures
c) explain ways of making organizing effective
ORGANIZING
This is an activity which establishes human adjustment among all the factors of
production. Organizations are social entities which coordinates the activities of a number
of people for their achievement of some common goals through division of labour and
well defined systems of working.
Organizing can be seen as a process.
As a process therefore, organizing can be defined as follows
1. A processing of welding together a framework of position which can be used by
the management for the purpose of accomplishing the organizational goals.
2. It’s a process of identifying and grouping the work to be performed, definitions,
responsibilities, delegating them and giving authority together with establishing
relationship for the purpose of enabling people to work most effectively in
accomplishing organizational objectives.
3. It’s a process of grouping of activities necessary of the purpose of achieving
organizational objectives.
Organizing can be seen as a structure.
As a structure organization, structure consist of those aspect of patterns of organization,
organizations that are attractively stable and change only slowly.
Equally, organization as a structure can be defined as a system of relationship that
governs the activities of people who are dependent upper each other / changing the
common objectives.
IMPORTANCE OF ORGANIZATION
1) Organizing is an aid to management-it aids management in accomplishing
organizational objectives.
2) It facilitates growth of the organization i.e. it assists in recruitment of staff,
delegation of authority assignment of responsibility etc.
3) It helps to ensure optimum use of human resources because it affects human
resources in different ways such as training, placement of workers, creating of
harmony, improving communication etc.
4) It stimulates creativity i.e. it encourages divergent thinking and makes
employers to be innovative.5) It facilitates stability of the business organization because it has flexibility to
adjust to changes.
6) It encourages adoption to technology because it facilitates optimum use of
technological improvements.
7) It leads to executive development because it provides training opportunities.
8) It helps to ensure cooperation among workers because it entails
communication reducing conflicts.
9) It establishes responsibility and prevents buck passing
10)It eliminates disputes between individuals
11)It provides for easier communication and helps in developing executives
12)It assists in measuring a person’s performance against his or her
responsibility
13)It aids in equitable distribution of work and functions
14)It permits expansion and contractions without seriously disrupting the
existing structure
15)It prevents duplication of work
16)It makes organizational goals possible without adequate control and without
literally killing top executives through overworking.
Essential elements of a good organization
1. A good organization must be helpful in the achievement of objectives
This means that it must be c capable of overcoming the problems of an organization
2. There must be harmonious grouping of functions: meaning that a good
organization should divide the functions in the enterprise in such a way that they
can be implemented easily and successfully.
3. An organization must be complete in all aspects
It means that a good organization must include all the activities of the enterprise and
there should be no any repetition of the activities (duplication)
4. There must be perfect coordination in all the activities of the organization.
If the activities are not coordinated, the achievement of the objectives of an organization
cannot be thought off.
5. There must be reasonable span of control
Through means that each manager or supervisor must have is reasonable number of
subordinates under him or her.
6. There must be proper utilization of resources
This means optimal use of resources this minimizes wastage and maximizes profits.
7. There is provision of expansion
This means that the organization must provide for adequate flexibility so that necessary
adjustment may be made in accordance to the needs of the charging circumstances
8. There has to be employee satisfaction. This includes job satisfaction which
minimizes high staff turnover
9. There must be a policy which can be executed easily and economically.
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The process of organizing
The building up of an organization is the most important function of management. The
process of organizing consist of the following steps
1. Determination and division of work
This is about determining the tasks required for the accomplishment of established
objectives via divided business activities into technical, commercial, financial, security,
and accounting and managerial. In a modern business enterprise manufacturing,
marketing, financing, purchasing and personnel are considered to be the main business
activities.
2. Grouping activities
The various activities identified above are then classified into appropriate departments
and divisions according to similarities and common purpose.
Such grouping of activities is known as departmentalization. Activities may be grouped
on the basis of functions, territories, customers e.t.c
Each department may be further divided into sections and subsections to create a logical
structure.
3. Assignment of duties
The individual departments are being allotted to different positions and individuals. The
duties of every individual are defined on the basis of his abilities and aptitude
Clearly definition of the responsibility of each individual is necessary to avoid
duplication of work and overlapping of efforts. Every individual is made responsible for
the specific job assigned to him. In this way, duties are assigned to specific individuals.
4. Delegation of authority
One of the duties and responsibility of every individual have been fixed, he must be
given the authority necessary or equivalent to carry out the duties assigned to him
A chain of command is created from top to the bottom through successful delegation of
authority.
Conclusion
The process of organizing is a series of steps which must be undertaken to create logical
structure of authority responsibility relationship. This process involves division of work,
placement of individuals on jobs, delegation of authority, coordination of individual
efforts and execution of responsibility for the results.
Principles of organization
The following are the major principles of organizing:1. Principle of objectives
It states that the objectives of the business concern formulating the organizational
structure and achieving the desired results with minimum costs and efforts.
2. Principle of specialization
It states that good organization must divide work into smaller activities and entrust each
to individuals with enough skills in better performance and quality.
3. Principle of span of control
This states that span of control should be minimized because there is a limit to the
number of persons that can be effectively supervised by one boss.
4. Principle of exception
This means that only exceptionally, complex matters should be referred to the executives
for decision making otherwise managers should handle matters relating to their levels.
5. Principle of scalar chain
This is sometimes known as the scalar principle. From the chief executive at the top of
the enterprise to the first line of the bottom which must be clearly be stated. This is also
known as chain of command. This is likely to minimize any confusion in organizational
function
6. Principle of authority
This means that the responsibility and authority of each manager and supervisors should
be clearly defined. It also implies that the authority given must be equal to the
responsibility entrusted to the manager.
7. Principle of unity of command
This states that each subordinate should have only one supervisor to report to. This is
likely to minimize the disorders, delays and confusion. It also reduces conflicts
8. Principle of delegation of authority
According to this principle, the authority delegation should be equal to the responsibility
so that to enable the concerned person to accomplish the task assigned to him/ her by his
or her supervisor. This helps to minimize partial delegation.
9. Principle of responsibility
This states that the superiors should not be allowed to avoid responsibility by delegating
authority to his or her subordinates. The superiors therefore must be held responsible to
the acts of his or her subordinate to whom he or she has delegated authority.
10. Principle of flexibility
This states that the organization structure should be such which should be adaptable to
the changing circumstances, meaning that there should be room for expansion and
replacement without disrupting the basic design of the structure. It also means giving
room for addition of subtraction if need be.
11. Principle of simplicity
This states that the organization structure should be simple enough with minimum
number of levels. This is likely to reduce the problem of poor coordination and
communication.
12. Principle of continuity
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This states that the structure should be such that its serviceable for a long time. This is
possible if it’s dynamic and capable of adopting itself to the views of changing
circumstances.
13. Principle of unity of direction
This states that for a group of activities having the same objectives there should be one
plan and one objective this facilitates verification and coordination of activities.
14. Principle of efficiency
This states that the structure that is formulated should enable the business concern to
function efficiently and achieve its objectives with minimum costs and efforts.
15. Principle of balance
It states that a good organizing must put balance on all types of factors of production so
that inefficiency is reduced.
Organizing is considered a process which contains the following key components
and concepts
• Job design
• Grouping of jobs/departmentation
• Authority and responsibility
• Span management
• Organization structure
i.
Job design
This is the process of determining what procedures and operations are to be performed
by the employees in each position based on qualification and experience. The basis for
all job design activities and job specialization which involves a definition of the task that
distinguishes one job from the others
ii.
Departmentation (grouping of jobs)
This is the process of grouping jobs into logical sets in an organization.
It is also a process of grouping individual jobs into departments as well as equipments.
A department is a distinct area, unit or a subsystem of an organization over which a
manager has authority for performance of specific activities. It is also known as division,
branch battalion etc.
DEPARTMENTATION IS REQUIRED DUE TO THE FOLLOWING
REASONS.
1. Specialization- Departmention enables an enterprise to take advantage of
specialization since division of work becomes possible.
2. Expansion- With expansion only one manager can oversee a limited number of
subordinates. In the absence of departmentation the size of the enterprise remains
limited.
3. Autonomy- Departmentation results in the division of the enterprise into semi
autonomous units. In this units every manager is given adequate freedom.
Autonomy provides job satisfaction and motivation which in turn leads to higher
efficiency of operations.Williamkamau14@gmail.com fb:William kamau
4. Appraisal- Appraisal of managerial performance becomes easier when specific
tasks are assigned to departmental personnel.
5. Fixation of responsibilities- Departments enables each person to know the specific
part he / she is to play in the total organization. It provides a basis for building up
loyalty and commitment.
6. Management development- Departmentation facilitates communication,
coordination and control. It simplifies the training and development of
executives by providing them opportunity to take independent decisions and to
exercise initiatives.
7. Administrative control- Grouping of activities and personnel into manageable
units facilitates administrative control. The standards of performance for each
and every department can be precisely determined.
Departmentalization usually groups jobs according to one of the following bases;
• Number
• Time
• Function
• Product
• Location
• Equipment/process
• Customer
a. Departmentation by simple numbers
This was once an important method in organization of tribes, clans, armies e.t.c the
simple numbers method of departmentation is achieved by tolling off people who are to
perform the same duties and putting them under the supervision of a manager.
The essential fact is not what these people do, where they work, or what they work with.
It is that the success of the undertaking depends on the number of people involved in it.
b. Departmentation by time
This is a form of grouping jobs which has generally at lowest levels of organization. The
use of shifts in many enterprises where for economic, technological or other reasons, the
normal working day would not be enough.
Example of this kind of department is the hospital where around the clock patient care is
essential. Similarly, deferent departments have to be ready to respond to the emergencies
at any time.
A factory operating for 24 hrs may have three departments, morning, day and night shifts.
c. Departmentation by function
Functional departmentation entails what enterprises typically do.
Employees who are involved in the same or very similar features are grouped together.
The basic enterprise functions are;Williamkamau14@gmail.com fb:William kamau
1. Production i.e. creating utility or adding utility to a good/ service
2. Selling i.e. finding customers, patients, clients, students, or members who will
agree to accept the services/ goods at a price
3. Financing i.e. raising and collecting, safeguarding and expanding the finances of
the enterprise
The coordination of activities may be achieved through the rules and procedures, various
aspects of planning such as budgeting the organization hierarchy e.t.c
Advantages of departmentation by function
1. It maintains power and prestige of major functions
2. It is logical and time proven method
3. It follows the principle of occupational specialization and thereby facilitating
efficiency into the utilization of people
4. It simplifies training
5. It provides a means of maintaining tidy control at the top because top managers
are responsible for the end results
6. Coordination is improved since work is not duplicated at specific functional levels
7. It provides better opportunities for growth and career development
Disadvantages of departmentation
1. Responsibility for profits is at the top level only
2. It results into slow adaptation to changes in environment
3. It reduces coordination between functions at overall level
4. It deemphasizes the overall company objectives i.e. it leads to sub optimization
5. It limits development of managers who need certain knowledge and experience
in all enterprise functions
6. The chain of command becomes excessively long as new levels are added this
may slow down communication
BOARD OF DIECTORS
MANAGING DIRECTOR
MARKETING
PRODUCTION
FINANCE
QUALITY CONTROL
PROCESSING
REPAIRS AND
MATERIALS
MAINTENANCE
Chart showing departmentation by function.d. Departmentation by product
The activities associated with individual products or closely related products lines are
grouped together. This structure permits top management to delegate to division
executives authority over the manufacture, sales and engineering.
Advantages
1. All activities associated with unique products are kept together
2. Profitability of the various products is more easily evaluated
3. Internal competition is promoted I.e. one product line competes with another
4. It uses specialized technology
Disadvantages
a) Some duplication of efforts may results i.e. each product line may require its
own accountant, engineer, marketing staff e.t.c
b) Coordination of departments mat be difficult
c) Additional management personnel may be required to handle different product
lines
d) The firm may find it difficult to adopt itself to changes in demand and
technology
e. Departmentation by location, territory/ geographical
Jobs are in one location or nearby locations are grouped together into one department and
allocated a manager.
Territory departmentation is very useful to a large scale enterprise whose activities are
geographically spread e.g. banks, insurance companies, transport companies,
supermarkets; distribution agencies e.t.c. the ultimate authority for performing the basic
organizational functions is still retained by the headquarters.
Advantages
1) It places responsibility at lower levels
2) It improves coordination within the region
3) It places emphasize on local market and problems
4) It improves face to face communication with the local people
5) It provides a measurable training ground for general managers
6) The managers can give special attention to the needs and problems of the local
market
Disadvantages
1) It requires more persons with general manager ability
2) Coordination and control of a different branches from the head office becomes
less effective
3) There is duplication of resources especially the human resources.
4) The branches are expensive to run.
5) Due to the geographical
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