UNIT- 5: ORGANISING

Meaning- It refers to the process of defining and grouping the activities of an enterprise and
establishing authority relationshipamong them.
Organising Process (IDEA)
I - Identification and division of Work
D - Departmentation
A - Assignment of duties
E - Establishing reporting relationship.
Importance/Significance of Organising BADO
B - Benefits of specialization
A - Adaptation to changes
D - Development of Personnel
O - Optimum utilisation of resources.
Organisation Structures-
It is a network of job positions, responsibilities and authority at different levels.
Span of management means how many employees or subordinates can be effectively managed by one
manager or how many subordinates can be effectively controlled by one superior.
Types of Organisational Structure:
(i) Functional Structure and, (ii) Divisional Structure.

Functional Structure–When the activities or jobs are grouped keeping in mind the functions or the job
then it is called functional structure.
Advantages of functional structure:-
(a) Occupational specialisation
(b) Promotes control and coordination within department
(c) Increase managerial and operational efficiency
(d) Due attention to different functions.
Disadvantages of functional structure:-
(a) Problem of coordination
(b) Conflicts of interest
(c) Less emphasis to overall objectives of organisation.
(d) Difficult to fix accountability.

Divisional Structure – Created on the basis of different products produced by business.

Advantages of Divisional Structure:-
(a) Product specialization
(b) Easy to fix accountability
(c) Fast decision making
(d) It facilitate Expansion and Growth.
Disadvantages of Divisional Structure:-
(a) Increase in cost
(b) Ignore organizational interests.
(c) Product focus department
(d) Conflict.
Delegation of Authority:- Transfer of authority from superiors to his subordinates.
Elements- 1. Responsibility 2. Authority and 3. Accountability.
1. Responsibility: It means the work assigned to an individual. It includes all the physical & mental
activities to be performed by the employees at a particular job position.
2. Authority: It means power to take decision. To carry on the responsibilities, every employee needs to
have some authorities.
3. Accountability: To make sure that the employees or subordinate perform their responsibilities
in their expected manner, the accountability is created.
Importance of Delegation:-
(a) Effective management
(b) Employees development
(c) Motivation of employees
(d) Facilitates organisational growth
(e) Better Coordination
(f) Reduces the work load of managers.
Decentralisation- It refers to the systematic transfer of authority throughout the organisation on
permanent basis.
Importance of Decentralisation:
(a) Relief to top management
(b) Develops initiative among subordinates
(c) Develops managerial talent for the future
(d) Facilitates growth
(e) Quick decision making
(f) Better control

Case Studies
Question 1.
Aman Chadha started ‗Bulls Eye‘ a company for providing cyber security solutions to businesses. Its
objective is to prevent, detect and respond to cyber-attacks and protect critical data. He was a
hardworking software engineer and an expert in cyber security. His reputation grew by leaps and
bounds as he was not only a person of integrity but also did his work with utmost honesty and
sincerity. The business started growing day by day. He was delighted when he was offered a big
project by the Ministry of Defence. While working on the project, he found that the volume of work
made it impractical for him to handle all the work by himself. He decided to expand the team. The
company maintained a close liaison with a local engineering college. During a campus placement, Ishan
and Vrinda were appointed to work for the new project. He found the new employees capable,
enthusiastic and trustworthy. Aman Chadha was thus, able to focus on objectives and with the help of
Ishan and Vrinda, the project was completed on time. Not only this Aman Chadha was also able to
extend his area of operations. On the other hand Ishan and Vrinda also got opportunities to develop
and exercise initiative.
Identify and briefly explain the concept used by Aman Chadha in the above case which helped him in
focusing on objectives. Also, state any four points of importance of the concept identified in (i) above.
Answer: Delegation of authority is the concept used by Aman Chadha in the above case which helped
him in focusing on objectives. Delegation of authority is the process of granting of authority to the
subordinates to operate within prescribed limits.
The four points of importance of delegation of authority are described below:
(a) Effective management: It helps the managers to function more efficiently as they get more time to
concentrate on important matters. Freedom from doing routine work provides them with opportunities
to excel in new areas.
(b) Employee development: By empowering the employees, they are given more opportunities to utilise
their talent and this may help them to become better leaders and decision makers in future.
(c) Motivation of employees: Delegation also has psychological benefits as helps in building the self-
esteem of an employee and improves his confidence and work performance. When a superior entrusts a
subordinate with a task, it is not merely the sharing of work but involves trust on the superior‘s part
and commitment on the part of the subordinate. Thus, delegation may give rise to latent abilities in the
subordinates.
(d) Facilitation of growth: With the increase in the competence of the employees, an organisation
tends to gain in many ways. The growth and expansion of the firm becomes easy as the capable
workforce is ready to take greater responsibilities.

Question 2.
Ramdas, aged 49 is working in an aviation company. He is the senior most employees in his division.
He is even senior to the division manager, Kanaputti. Ramdas is considered one of the most committed,
capable and hard-working employees. As a result of his abilities and seniority, he generally received the
work assignments of his choice. Although there was no formal designation of various „special‘ projects
assigned to Ramada‘s, he handled them as a matter of routine. A problem developed when an able and
intelligent person Nagarjuna, aged 33, was appointed by Kanaputti. Nagarjun‘s previous three years‘
experience in the closely related work, made it possible for him to catch on to the routine work of his
new job more rapidly than was customary for a new employee. On several occasions, Kanaputti noticed
the tension developing between the two employees.
However, he didn‘t want to get involved in their personal issues as long as the work was completed
effectively and efficiently by them. One day, the tension between them reached the boiling point and
Rumbas complained to Kanaputti stating that his duties were being largely taken over by Nagarjun.
Kanaputti issued the order stating the clear allocation of the jobs and related duties between the two. He
further clarified the working relationship between them by specifying who was to report to whom. This
helped in reducing the workload, enhancing productivity and removing ambiguity.
1. Identify and state the step of organizing process which has not been carried out properly and
contributed to this problem.
2. State the two steps of the organizing process which have been taken by Kanaputti to respond to the
complaint of Ramdas.
3. Also state two points of importance of organizing as reflected in the above case.
Answer:
The step of organizing process which has not been carried out properly and contributed to this problem
is Assignment of duties.
1. Assignment of Duties: Once departments have been created each of them is placed under the charge
of an individual and then jobs are allocated to the members as per their job positions.
2. The two steps of the organizing process which have been taken by Kanaputti to respond to the
complaint of Ramdas are listed below:
* Assigning the duties
* Establishing reporting relationship.
3. The two points of importance of organizing as reflected in the above case are described below:
(a) Optimum utilization of resources: Organising ensures best possible use of all forms of resources
i.e. physical, financial and human resource. It ensures systematic assignment of jobs thereby curbing
overlapping of work and avoiding possibilities of duplication of work. This helps in preventing
confusion and minimising the wastage of resources and efforts.
(b) Adaptation to change: The process of organising provides stability to the enterprise as it can then
continue to survive and grow inspite of changes in the business environment. It enables the organisation
structure to be suitably modified and the revision of inter-relationships amongst managerial levels to
pave the way for a smooth transition.

Question 3.
Kiran Industries is a company dealing in office furniture. The company chose to diversify its operations
to improve its growth potential and increase market share. As the project was important, many
alternatives were generated for the purpose and were thoroughly discussed amongst the members of the
organisation. After evaluating the various alternatives, Sukhvinder, the Managing Director of the
company, decided that they should add ‗Home Interiors and Furnishings‘ as a new line of business
activity.
(a) Name the framework, which the diversified organisation should adopt, to enable it to cope with the
emerging complexity? Give one reason in support of your answer.
(b) State any two limitations of this framework.
Answer:
(a) Divisional structure should be adopted by the diversified organisation to enable it to cope with the
emerging complexity.
Reason: It leads to faster decision making, promotes flexibility and initiative because each division
functions as an autonomous unit.
(b) The two limitations of divisional structure are as follows:
* There may be conflicts among the different division‘s heads as in pursuit of higher profits; each of
them may seek maximum allocation of resources at the cost of other divisions.
* The cost is high as each division is provided with separate set of similar functions.
Question 4.
Ishita works as a corporate event coordinator in an event management company. She has been made an
overall official incharge for organizing a painting exhibition for one of the clients of the company. For
ensuring that the exhibition takes place successfully, she identifies the various activities involved and
divides the whole work into various task groups like marketing committee, decoration committee and
reception committee. In order to facilitate coordination within and among committees, she appoints a
supervisor of each group. Each member in the group is asked to report to their respective supervisors
and all the supervisors are expected to work as per Ishita‘s orders.
In context of the above case:
(a) Identify the function of management being performed by Ishita.
(b) Describe briefly the various steps involved in the performance of the function of management as
identified in part (1) of the question.
Answer:
(a) The Organising function of management is being performed by Ishita.
(b) The steps involved in the process of organizing are as follows:
1. Identification and Division of Work: The first step in the process of organising relates to
identification and division of the work that has to be performed in accordance with predetermined
plans. This helps to avoid duplication of activities and makes the work manageable. It also ensures that
the burden of work is being shared among the employees.
2. Departmentalisation: The next step in the process involves grouping of similar activities into
departments, units, sections etc. using several criteria as a basis. This facilitates specialization.
3. Assignment of Duties: Once departments have been created each of them is placed under the charge
of an individual and then jobs are allocated to the members as per their job positions.
4. Establishing Reporting Relationship: While assigning jobs each member is told that from whom he
/she has to take orders and to whom he/she will be accountable. The establishment of such clear
reporting relationships help to create a well-defined hierarchical structure. It also facilitates
coordination amongst various departments.
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