Concept and meaning of organization
There are so many materials and people in an enterprise. Enterprise uses the manpower and materials for achieving the goals. Materials can be collected, established and coordinated. Manpower must be hired, trained, motivated and put at right place. Managers and workers must be clear about their authority and responsibility. Organization is defined as the determination of relationship between materials as well as human resources. It is most important and basic function of management. It includes division of work, coordination of people and appropriate establishment of materials and resources. Therefore, we can say that organization is necessary function of management. Without it a business firm can’t move ahead. In short organization refers to a mechanism which enables man to live together and perform the activities collectively. It is the foundation on which the whole structure of management is built.
Principles of organization
- Principle of unity of objectives: Organizational goals, departmental goals, and individual goals must be clearly defined. All goals and objectives must have uniformity. When there is contradiction among different level of goals desired goals can’t be achieved. Therefore, unity of objectives is necessary.
- Principle of specialization: Sound and effective organization believes on organization. The term specialization is related to work and employees. When an employee takes special type of knowledge and skill in any area, it is known as specialization. Modern business organization needs the specialization, skill and knowledge by this desired sector of economy and thus, efficiency would be established.
- Principle of coordination: In an organization many equipment, tools are used. Coordination can be obtained by group effort that emphasize on unity of action. Therefore, coordination facilitates in several management concepts.
- Principle of authority: Authority is the kind of right and power through which it guides and directs the actions of others so that the organizational goals can be achieved. It is also related with decision-making. It is vested in particular position, not to the person because authority is given by an institution and therefore it is legal. It generally flows from higher level to the lowest level of management. There should be unbroken line of authority.
- Principle of responsibility: Authentic body of an organization is top-level management, top-level management direct the subordinates. Departmental managers and other personnel take the direction from top-level management to perform the task. Authority is necessary to perform the work .only authority is not provided to the people but obligation is also provided. So the obligation to perform the duties and task is known as responsibility. Responsibility can’t be delegated. It can’t be avoided.
- Principle of delegation: Process of transferring authority and creation of responsibility between superior and subordinates to accomplish a certain task is called delegation of authority. Authority is only delegated, not responsibilities in all levels of management. The authority delegated should be equal to responsibility.
- Principle of efficiency: In enterprise different resources are used. These resources must be used in effective manner. When the organization fulfills the objectives with minimum cost, it is effective. Organization must always concentrate on efficiency.
- Principle of unity of command: subordinates should receive orders from single superior at a time and all subordinates should be accountable to that superior. More superior leads to confusion, delay and so on.
- Principle of span of control: Unlimited subordinates can’t be supervised by manager, this principle thus helps to determine numerical limit if subordinates to be supervised by a manager. This improves efficiency.
- Principle of balance: The functional activities their establishment and other performances should be balanced properly. Authority, centralization, decentralization must be balance equally. This is very challenging job but efficient management must keep it.
- Principle of communication: Communication is the process of transformation of information from one person to another of different levels. It involves the systematic and continuous process of telling, listening and understanding opinions ideas, feelings, information, views etc., in flow of information. Effective communication is important
- Principle of personal ability: For sound organization, human resources is important. Employees must be capable. Able employees can perform higher. Mainly training and development programs must be encouraged to develop the skill in the employees.
- Principle of flexibility: Organizational structure must be flexible considering the environmental dynamism. Sometimes, dramatically change may occur in the organization and in that condition, organization should be ready to accept the change.
- Principle of simplicity: This principle emphasizes the simplicity of organizational structure, the structure of organization should be simple with minimum number of levels so that its member can understand duties and authorities.
Importance of organization
- Mechanism for management in action: Organization is not only a chart. It is a mechanism for management in action. So many management actions such as direction, motivation, coordination and control help ion organizing function. It also helps to manage the business firm with proper management actions.
- Facilitate in management and operation: Organization is directly or indirectly related to well-defined work, authorities, responsibilities and account-abilities Managers and other employees are benefited by appropriate functional activities. It helps in smooth and effective management operation giving effective functional activities.
- Effective delegation: All level of management must make the decisions. Sufficient level of authority and responsibility must be delegated to make the decisions. When the delegation of authority and responsibility is affected all level of employees can make the decisions easy. Organization helps in effective delegation.
- Growth and diversification: Organization clear division of work, delegation of authority and responsibility, the relationship among resources etc. these activities helps in growth and diversification function. On the other hand, sound org give the clear cut frame work to do work too.
- Optimum use of technological resources: Organization use machines, equipment and tools. With the help of org many sophisticated technologies and improved materials are used. Use of the latest technologies help in efficiency improvement.
- Use of human resource: Human resource must be properly utilized. Org help in great utilization of manpower by placing right people and right place in the basis of their qualification, experience, skill and knowledge etc. Developing employees and motivating them are the most important tools to use the human resources.
- Flexibility: Organization may be changed according to the needs of environment and changing circumstances. The org structure must be flexible that helps to adjust in external as well as internal environment.
- Productivity increment: When the authorities and responsibility are given to all employees they can make decision in their working level, appropriate adjustment of resources is the most important management function which help to increase the productivity.
- Determination of objectives: In the 1st step of organizing process, the objective of an enterprise is to be determined. Every business firm set the goals, and they want to achieve these goals. Further existence of business firms depend on the goal achievement. In this process, strategy, planning and policies are made.
- Determination of activities: After determination of objective, the activities must be determined. There may be various activities in an enterprise. According to the goals of the firm the activities must be determined. The activity may be divided into different functions like production, financing, sale, administration, recruitment etc. all these activities must be directed towards the goals of the enterprise.
- Grouping activities: In organization different works of different nature have to be performed. When similar natures of work are grouped in unit, section, or department, then that is known as grouping of activities. It is a function of departmentation. For example the activities of production may be grouped separate in production department
- Allocation of duties and responsibility: After grouping the activities, an individual is assigned to a specific job or post. According to position, duties, and responsibilities the ob must be specified. When duties are provided to the employee then he/she is responsible for doing the job. Therefore, it is an important step of organizing process.
- Delegation: Mainly authority is in top-level management. And the authority must be delegated to worker through middle level and lower level management. Authorities, duties, and responsibilities come together. So without authorities, duties, and responsibilities there is no proper work done and balance.
- Communication: After proper delegation of authority, effective communication system must be developed. It is the most important step that helps in liking so many departments, position and other authority group. When communication system is not effective, the organizing function is not better.
- Coordination: All employees, department, divisions and branches conduct many activities. Proper and effective coordination coordinates these activities. After communicating all essential information and messages all resources and factors must be coordinated in the enterprise. Without proper coordination, team work can’t be established and consequently the organizational goals can’t be achieved.
- No Files at the moment
We're always listening.
Have something to say about this article? Find us on Facebook