Organizing: Meaning, Nature, Principles, Functions, Importance, and Process

What is Organizing in Management?

Organizing is the second function of management and involves primarily creating activities and assigning suitable workers to complete these activities successfully, efficiently and effectively.

Activities that are well organized and coordinated result in optimal use of resources and reduce or eliminate waste and idle times of both the machines and the workers.

The main focus of the process of organizing is the allocation of human and non-human resources in order to execute planning in the best possible way. It is a result-oriented process that involves affecting innovation and facilitating the desired changes. It is through the process of organizing that a firm establishes the relationship of authority and responsibility among its employees.

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Nature of Organizing

The nature/characteristics of organizing in management are as follows:

1. Social Entities
   
2. Goal-directed
   
3. Deliberately Structured Activity Systems
   
4. Permeable Boundary

Social Entities

The word social as a derivative of society basically means a gathering of people as against plants, machines, and buildings, even though plants, machines, and buildings are necessary contributors to the existence of the organization. Organizations will cease to exist if there are no people to run them, even if other things remain.

Goal-directed

All efforts of an organization are directed towards a common goal. A common goal or purpose gives organization members a rallying point.

Deliberately Structured Activity Systems

By systematically dividing complex tasks into specialized jobs and categories of activities into separate departments, an organization can use its resources more efficiently. Subdivision of activities achieves efficiencies in the workplace.

The organizations are deliberately structured in such a manner as to coordinate the activities of separate groups and departments for the achievement of a common purpose.

Permeable Boundary

All organizations have boundaries that separate them from other organizations. These boundaries determine who and what is inside or outside the organization. Sometimes, these boundaries are vigorously protected.

However, the dynamics of the changing world have made these boundaries less rigid and more permeable in terms of sharing information and technology for mutual benefit.

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Principles of Organizing

The principles of organizing can be understood as:

1. Principle of Functional Definition
   
2. Principle of Supervision
   
3. Principle of Specialization
   
4. Principle of Scalar Chain
   
5. Principle of Unity of Command

Principle of Functional Definition

Organizing requires the different duties, responsibilities, authority, and relationships to not only be identified clearly but also allocated to people in a systematic fashion. This clear definition of relationships between managers and subordinates ensures that coordination and organization occur in a harmonious fashion.

Principle of Supervision

This principle gives a guideline or structure as to how many subordinates or junior employees can be handled or supervised by a single manager. The span of control specifies their area of control in the organizational structure.

There can be two types of the span of control: wide or narrow. Each type of differentiation has its own benefits and disadvantages. It is based on the cost of supervision, employee responses, communication infrastructure, nature of the job, etc.

Principle of Specialization

The division of work is done in an organization to ensure that maximum efficiency is achieved. The work is divided or delegated on the basis of the skills, qualifications, and abilities of the subordinates.

Principle of Scalar Chain

The workflow or the chain of command in an organization that follows the direction of top to bottom is known as the scalar chain. It ensures easy organization, minimization of wastage, avoidance of duplication of duty, and many other benefits. Here the managerial and subordinate hierarchy is clear at every stage.

Principle of Unity of Command

This principle dictates that one subordinate be answerable or accountable to one manager at a time. This ensures the unity of command in the sense that the responses and coordination are very clear and prompt. There is the effective utilization of resources and therefore effective coordination and organization of functions.

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Organizing Functions of Management

The organizing functions of management that are undertaken by a manager in an organization are:

1. Recognition and Identification of Tasks
   
2. Departmentation of Activities
   
3. Authority and Delegation
   
4. Coordination

Recognition and Identification of Tasks

This step requires the managers to first be aware of all the activities or functions that are required to perform in order to achieve the objectives of the organization. This involves every activity like production, sales, record keeping, quality control, preparation of accounts, and inventory management amongst others.

Departmentation of Activities

After the identification of activities, it is important that these are segregated and combined with different activities so that all the tasks of similar nature are under one department.

Authority and Delegation

Next to the departmentation function being complete, it is time to clarify and designate the span of control of managers overseeing these different departments and the various managers who will be helping them carry out these functions in these departments. This is then followed by the hierarchical division of authority to establish a chain of command.

Coordination

An important organizing function of management is to ensure coordination between different managers in the organization. This is important for the managers as they will be clear as to what becomes their responsibilities and to who they are accountable in the organization. Once the reporting chart of activities is clear, all the activities will go no smoothly.

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Importance of Organizing

The importance of organizing is as follows:

1. Essential for Continuity of Mission and Objective
   
2. Helps in Perform Activities Effectively
   
3. Optimum Use of Technological Improvement
   
4. Growth and Diversification
   
5. Helps in Human Resource Development
   
6. Helps in Coordination

Essential for Continuity of Mission and Objective

Organizing is essential for the continuity of the mission and objective for which it is formed. The organizational structure and process guide the coordination and control of business activities. The organization is structured on sound principles that will help achieve management objectives.

Helps in Perform Activities Effectively

The function of organizing helps its management to perform its activities effectively, in the optimum use of technological improvement, growth and diversification, creativity, effective use of physical resources, and development of human resources.

Optimum Use of Technological Improvement

The organizing functions help in the optimum use of technology since it is flexible and structured to accommodate improvement, extensions, and so on. Automatic controls and data processing become feasible under a sound organization.

Growth and Diversification

Organizing is the base on which the company grows and diversifies its activities. The organizational structure is developed in such a way that expansion and diversification are feasible without wastage.

The organization while facilitating day-to-day functions and effective management of all the activities, anticipates the need for change and helps the growth of the corporate body, the branch offices, divisional offices, and regional subheads.

Helps in Human Resource Development

Enterprises work in a knowledge society and have to function by caring for the labor force. Human resources have demonstrated outstanding ingenuity and adaptability for the survival and growth of the company.

Helps in Coordination

Organizing ensures coordination between different managers in the organization. This is important for the managers as they will be clear as to what becomes their responsibilities and to who they are accountable in the organization.

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Process of Organizing

The process of organizing involves the following five steps.

1. Reviewing Plans and Objectives
   
2. Determining Activities
   
3. Classifying and Grouping Activities
   
4. Assigning Work and Resources
   
5. Evaluating Results

Reviewing Plans and Objectives

The first step for the management is to reflect on the organizational goals and objectives and its plans to achieve them so that proper activities can be determined.

For example, if a high-class restaurant is to be opened in an elite area, then the management must establish objectives and review these objectives so that they are consistent with the location of the restaurant and the type of customers to be served.

Determining Activities

In the second step, managers prepare and analyze the activities needed to accomplish the objectives. In addition to general activities such as hiring, training, keeping records and so on, there are specific activities that are unique to the type of business that an organization is in.

For example, in the case of a restaurant, the two major activities or tasks are cooking food and serving customers.

Classifying and Grouping Activities

Once the tasks have been determined, these tasks must be classified into manageable work units. This is usually done on the basis of the similarity of activities.

For example, in a manufacturing organization, the activities may be classified into production, marketing, finance, research and development, and so on. These major categories of tasks can be subdivided into smaller units to facilitate operations and supervision.

Assigning Work and Resources

This step is critical to organizing because the right person must be matched with the right job and the person must be provided with the resources to accomplish the tasks assigned.

The management of the restaurant must determine who will take the orders and who will set them as well as clear the tables, and what the relationship between these individuals will be. Management must also make sure that adequate resources of food items, utensils, and cutlery are provided as necessary.

Evaluating Results

In this final step, feedback about the outcomes would determine how well the implemented organizational strategy is working. This feedback would also determine if any changes are necessary or desirable in the organizational setup.

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