It is a process of dividing work into convenient tasks or duties or groups of duties, delegating authority to each post and appointing qualified staff to be responsible so that work may be done as planned.
As a process, organisation can be defined as:
- Identifying the work to be done
- Divide the work into small tasks
- Identify individuals to be in charge of the tasks.
- Assign authority.
- Task is carried out.
- Promotes specialization
- Defines the jobs – this facilitates the process of fitting the right persons the right job
- Clarifies authority and power of different departments – this minimizes conflict and confusion
- Avoids duplication of work and overlapping in responsibilities among various organisational members and work by assigning specific jobs to individuals and work units.
- Facilitates coordination in the sense that it clearly shows who can exercise authority over whom to bring harmony of work and unity of efforts of people.
- Acts as a source of support, security, and satisfaction – organising shows the status and position of employees and their relative positions in relation to others.
- Facilitates adaptation of the activities in response to the changes taking place in the external environment with respect to technology, market, product, process e.t.c.
- A flexible organisation structure facilitates growth of the organisation by increasing its capacity to handle increased levels of activity
These are the guidelines for planning and efficient organisational structure:
- Division of Labour – The entire work of the organisation should be divided into specific jobs and a specific job should be given to an individual. Such specialisation brings about internal economies in the business such as increase in productivity and quality.
- Functional Definition – The functions which are required to be performed by an individual, should be well defined that there is no overlapping of functions. More specifically, this principle enables individuals to know what is expected from them as members of the group.
- Scalar Chain of Command (scalar principle) – There must be an unbroken chain of authority running from the top to the bottom.
- Span of Control (span of supervision) – It refers to the number of subordinates which a manager can effectively supervise within the limits of available time and his ability.
- Unity of Command – Every employee should be answerable to only one supervisor from whom he receives orders and is . An employee is likely to be frustrated and confused when he or she receives instructions from different supervisors
- Unity of Direction – There should be only one head and one plan for a group of activities having the same objectives. This principle emphasizes the importance of common goals being pursued by all and promotes smooth co-ordination of activities efforts and resources
- Departmentalisation – This is the manner in which activities should be divided and formed in to specialized groups. It simplifies the tasks of managers and maintains control within the organisation.
- Best use should be made of specialization
The contingency theory of organization structure suggests that a number of variables influence organization structure. These include:
- Age – the older the organization the more formalized its behavior i.e. work is repeated, so is more easily formalized and standardized. Organization structure therefore reflects the age of the industry.
- Size and Growth – the larger the organization the more elaborate its structure will be, the larger the average size of the units within it and the more formalized its behavior for consistency
- The Nature of Tasks – The complexity of the task affects the structure of the organization.
- Coordination – mutual adjustment, direct supervision and standardization all have consequences for the organizational structure.
- Skills of managers and workers (Type of personnel employed)
Can people be left alone to do the job or do they require close supervision?
- Job design – Are jobs broken down into discrete activities?
- Geographic dispersion – An organization with several sites will have a different organization structure from one located in one place.
- Control – The more an organization is subject to external control e.g. by government or holding company, the more centralized and formalized its structure.
- Technology – The stronger the technical system the more formalized the work and the more bureaucratic the structure of the organization. Also, the more sophisticated the technology the more elaborate and professional the support staff will be.
- Environment: does it require a flexible, supporting or inflexible structure.
The organizing function is made up of 4 main elements:
- Job Design (Division of work into Jobs)
- Departmentalization (Grouping Jobs in to Departments)
- Vertical Co-ordination
- Horizontal Co-ordination