Report in Organization

and Management:

ORGANIZING
BY
GROUP 2:
Prudencio de Guzman
Jeia Soriano
Kyla Bigay
Luis Peralta
ORGANIZING
- is the function of management that involves developing an organizational structure and
allocating human resources to ensure the accomplishment of objectives.

- is arranging tasks, people and other resources to accomplish the work

- considered as the most critical function in management

THE 4 STEPS OF ORGANIZING

1. Identification of activities - All the activities which have to be performed in a
concern have to be identified first. For example, preparation of accounts, making sales,
record keeping, quality control, inventory control, etc. All these activities have to be
grouped and classified into units.
2. Departmentally organizing the activities - In this step, the manager tries to
combine and group similar and related activities into units or departments. This
organization of dividing the whole concern into independent units and departments is
called departmentation.
3. Classifying the authority - Once the departments are made, the manager likes
to classify the powers and its extent to the managers. This activity of giving a rank in
order to the managerial positions is called hierarchy. The top management is into
formulation of policies, the middle level management into departmental supervision and
lower level management into supervision of foremen. The clarification of authority help
in bringing efficiency in the running of a concern. This helps in achieving efficiency in
the running of a concern. This helps in avoiding wastage of time, money, effort, in
avoidance of duplication or overlapping of efforts and this helps in bringing smoothness
in a concerns working.
4. Co-ordination between authority and responsibility - Relationships are
established among various groups to enable smooth interaction toward the achievment
of the organizational goal. Each individual is made aware of his authority and he/she
knows whom they have to take orders from and to whom they are accountable and to
whom they have to report. A clear organizational structure is drawn and all the
employees are made aware of it.

Nature of Organizing or Organization:

There are two essential Concepts regarding with Organizing:
Organization as a Process: The concept of organizing can be considered
as a process, because a large number of events or activities are done under the process
of organizing with-a-view to accomplish the preset goals in an appropriate way. In
fact, organizing involves division of works, determination of activities, grouping of
activities, delegation of authority and the establishment of proper co-ordination and
balance among various departments of individuals towards the attainment of
predetermined goals. On the whole it is clear that the objectives of business firm
cannot be obtained by doing single activity, so organizing is set to be a process.
Organization as a Structure of Relationship: Organization refers to a
structure of relationship due to involvement of a large number of groups. In fact,
under the process of organizing the relationship of departments to departments,
groups to groups and individuals to individuals are analyzed carefully through the
process of communication system with a view to establish proper unity and co-

ordination among them. So that everyone can take initiative for the welfare of
enterprise. Thus it is clear that Organization can be considered as a structure of
relationship.

PURPOSE OF ORGANIZING

Helps to achieve organizational goal. Organization is employed to

achieve the overall objectives of business firms. Organization focuses attention of
individuals objectives towards overall objectives.

Optimum use of resources. To make optimum use of resources such

as men, material, money, machine and method, it is necessary to design an
organization properly. Work should be divided and right people should be given right
jobs to reduce the wastage of resources in an organization.

To perform managerial function. Planning, Organizing, Staffing,

Directing and Controlling cannot be implemented without proper organization.

Facilitates growth and diversification. A good organization

structure is essential for expanding business activity. Organization structure
determines the input resources needed for expansion of a business activity similarly
organization is essential for product diversification such as establishing a new
product line.

Humane treatment of employees. Organization has to operate for

the betterment of employees and must not encourage monotony of work due to
higher degree of specialization. Now, organization has adapted the modern concept
of systems approach based on human relations and it discards the traditional
productivity and specialization approach.

Organizational Structure Types

Following are the types of organizational structures that can be observed in the modern
business organizations.

Bureaucratic Structures
Bureaucratic structures maintain strict hierarchies when it comes to people management.
There are three types of bureaucratic structures:

1 - Pre-bureaucratic structures
This type of organizations lacks the standards. Usually this type of structure can be observed in
small scale, start-up companies. Usually the structure is centralized and there is only one key
decision maker.

The communication is done in one-on-one conversations. This type of structures is quite

helpful for small organizations due to the fact that the founder has the full control over all the
decisions and operations.

2 - Bureaucratic structures
These structures have a certain degree of standardization. When the organizations grow
complex and large, bureaucratic structures are required for management. These structures are
quite suitable for tall organizations.

3 - Post-bureaucratic Structures
The organizations that follow post-bureaucratic structures still inherit the strict hierarchies, but
open to more modern ideas and methodologies. They follow techniques such as total quality
management (TQM), culture management, etc.

Functional Structure
The organization is divided into segments based on the functions when managing. This allows
the organization to enhance the efficiencies of these functional groups. As an example, take a
software company.
Software engineers will only staff the entire software development department. This way,
management of this functional group becomes easy and effective.
Functional structures appear to be successful in large organization that produces high volumes
of products at low costs. The low cost can be achieved by such companies due to the efficiencies
within functional groups.
In addition to such advantages, there can be disadvantage from an organizational perspective if
the communication between the functional groups is not effective. In this case, organization
may find it difficult to achieve some organizational objectives at the end.

Divisional Structure
These types of organizations divide the functional areas of the organization to divisions. Each
division is equipped with its own resources in order to function independently. There can be
many bases to define divisions.
Divisions can be defined based on the geographical basis, products/services basis, or any other
measurement.
As an example, take a company such as General Electrics. It can have microwave division,
turbine division, etc., and these divisions have their own marketing teams, finance teams, etc.
In that sense, each division can be considered as a micro-company with the main organization.

Matrix Structure
When it comes to matrix structure, the organization places the employees based on the function
and the product.
The matrix structure gives the best of the both worlds of functional and divisional structures.
In this type of an organization,
the company uses teams to
complete tasks. The teams are
formed based on the functions
they belong to (ex: software
engineers) and product they
are involved in (ex: Project A).
This way, there are many
teams in this organization
such as software engineers of
project A, software engineers
of project B, QA engineers of
project A, etc.

ORGANIZATIONAL THEORIES AND APPLICATION

Classical Structures
Traditional organizations have either a pure hierarchical structure or a modified one, such as a
matrix structure that adds additional reporting paths to positions at the working level. In these
structures, employees report to one or more managers for their work and for disciplinary
matters. Managers in classical structures rely on the organizational structure to channel work to
the appropriate department. If there is an engineering problem, it goes to the engineering
department; if a problem exists with staff, human resources deals with it. Such organizations
work best in stable environment because they have limited flexibility, and they work well even if
you or your managers have limited experience and expertise.
Contingency Organizations
Contingency theory assumes that organizations adapt to their environments in the absence of
formal structures. How well the adaptation addresses the issues confronting the business
depends on the experience and knowledge of the managers and employees of the company. The
advantages of a well-adapted business include flexibility in addressing changes in the
marketplace and responsiveness to customer needs. If you are a member of a team of business
professionals who are experienced in their field of activity, a formal structure might get in your
way and a contingency organization may be the most effective choice.

Behavioral Organizations
Organizations that focus on the behavior of individual employees can can be successful in a wide
variety of business environments and are an alternative to a classical structure. These
organization types assume employees complete the required work if their company provides a
suitable business environment. If you are convinced your employees are hard-working and
responsible, an employee-focused organizational structure may be effective. The organizational
theories often place the employees in teams that have substantial authority to make workrelated decisions. You must be comfortable with delegating authority to choose this type of
organization, but it can be flexible and adaptive in a changing business environment.

DELEGATION
-Delegation is the process of giving decision-making authority to lower-level employees.
For the process to be successful, a worker must be able to obtain the resources and cooperation
needed for successful completion of the delegated task. Empowerment of the workforce and task
delegation are closely intertwined. Empowerment occurs when upper-level employees share
power with lower-level employees. This involves providing the training, tools and management
support that employees need to accomplish a task. Thus, an enabled worker has both the
authority and the capability to accomplish the work. Although authority can be delegated,
responsibility cannot-the person who delegates a task is ultimately responsible for its success.
The assigned worker is therefore accountable for meeting the goals and objectives of the task.
Elements of Delegation
1. Authority - in context of a business organization, authority can be defined as the
power and right of a person to use and allocate the resources efficiently, to take decisions
and to give orders so as to achieve the organizational objectives. Authority must be welldefined. All people who have the authority should know what is the scope of their
authority is and they shouldnt misutilize it. Authority is the right to give commands,
orders and get the things done. The top level management has greatest authority.
Authority always flows from top to bottom. It explains how a superior gets work done
from his subordinate by clearly explaining what is expected of him and how he should go
about it. Authority should be accompanied with an equal amount of responsibility.
Delegating the authority to someone else doesnt imply escaping from accountability.
Accountability still rest with the person having the utmost authority.
2. Responsibility - is the duty of the person to complete the task assigned to him.
A person who is given the responsibility should ensure that he accomplishes the tasks
assigned to him. If the tasks for which he was held responsible are not completed, then
he should not give explanations or excuses. Responsibility without adequate authority
leads to discontent and dissatisfaction among the person. Responsibility flows from
bottom to top. The middle level and lower level management holds more responsibility.
The person held responsible for a job is answerable for it. If he performs the tasks
assigned as expected, he is bound for praises. While if he doesnt accomplish tasks
assigned as expected, then also he is answerable for that.
3. Accountability - means giving explanations for any variance in the actual
performance from the expectations set. Accountability can not be delegated. For

example, if A is given a task with sufficient authority, and A delegates this task to B and
asks him to ensure that task is done well, responsibility rest with B, but accountability
still rest with A. The top level management is most accountable. Being accountable
means being innovative as the person will think beyond his scope of job. Accountability,
in short, means being answerable for the end result. Accountability cant be escaped. It
arises from responsibility.
For achieving delegation, a manager has to work in a system and has to perform following
steps : 1. Assignment of tasks and duties
2. Granting of authority
3. Creating responsibility and accountability

Classification of Organizations
Organizations are basically clasified on the basis of relationships. There are two types of
organizations formed on the basis of relationships in an organization
1. Formal Organization - This is one which refers to a structure of well defined
jobs each bearing a measure of authority and responsibility. It is a conscious
determination by which people accomplish goals by adhering to the norms laid down by
the structure. This kind of organization is an arbitrary set up in which each person is
responsible for his performance. Formal organization has a formal set up to achieve predetermined goals.
2. Informal Organization - It refers to a network of personal and social
relationships which spontaneously originates within the formal set up. Informal
organizations develop relationships which are built on likes, dislikes, feelings and
emotions. Therefore, the network of social groups based on friendships can be called as
informal organizations. There is no conscious effort made to have informal organization.
It emerges from the formal organization and it is not based on any rules and regulations
as in case of formal organization.
Relationship between Formal and Informal Organizations
For a concerns working both formal and informal organization are important. Formal
organization originates from the set organizational structure and informal organization
originates from formal organization. For an efficient organization, both formal and informal
organizations are required. They are the two phase of a same concern.
Formal organization can work independently. But informal organization depends totally upon
the formal organization.
Formal and informal organization helps in bringing efficient working organization and
smoothness in a concern. Within the formal organization, the members undertake the assigned
duties in co-operation with each other. They interact and communicate amongst themselves.

Therefore, both formal and informal organizations are important. When several people work
together for achievement of organizational goals, social tie ups tends to built and therefore
informal organization helps to secure co-operation by which goals can be achieved smooth.
Therefore, we can say that informal organization emerges from formal organization.