Organize your business efficiently
Definition of Organization
An Organization is a specific structure or framework which makes provision for the pursuit of certain common goals by people who find themselves in a relative position to one another.
The term Organization can also refer to the act of organizing a business or an activity related to a business.
Definition of Organizing
Organizing is the ordering of related tasks so that more may be achieved by fewer people. Organizing is a management function which deals with arranging activities and resources by allotting duties, responsibilities and authority to people, and the determination of relationships between them to promote collaboration and to achieve the objectives of the undertaking as effectively as possible. To do this, there must be a collaboration between the people concerned.
The overriding value of an organization is its ability to make more effective use of human resources.
Principles of organization
The principles can be set out briefly as follows:
Organization Principle Nr 1: Goals
It is hereby understood that the organizational structure of the organization, and specifically each department and section, must be constituted (put together) in such a manner that the goals will still be attained in the most economical manner. This means that the framework of departments and sections must not include more positions than is absolutely necessary, but also no less.
The leader must be very critically focused towards what he has to attain, and obtain answers to the following questions:
Does he know exactly what is expected of him and his team of subordinates?
Does his subordinates know exactly what is expected of them?
Are the subordinates promised to him, adequate to reach the required goals?
Are they not perhaps too many, if a more suitable work grouping is done?S
Organization Principle Nr 2: Specialization
Work which you give to your subordinates must, as far as possible, be relevant to their abilities, training and interest. Therefore, give work to the man who, at a given moment, is the best qualified for it.
It is obvious that the quality of work will be much better if it falls within the abilities of the subordinate, if he has had the necessary training to do it, and if he is interested in what he has to do.
Through specialization, you can ensure that:
a high level of proficiency will be maintained;
maximum effectiveness will be attained and,
sources will be applied economically.
If a leader must delegate a certain project, he can entrust it to differently trained subordinates or he can give the different kinds of specialized work to one subordinate. The leader knows his people, their preparedness for a task and their area of specialization and will, therefore, as far as possible, give to each subordinate work in his own line of skill.
It does not mean that you must always use each of your subordinates for only one kind of work. You must endeavour to broaden their knowledge by training as many of them as possible in such a manner as to develop and to motivate them to become specialists in more than one field.
A broad base of specialities among subordinates will especially have the following advantages:
Absences will be overcome more easily by allowing competent subordinates to temporarily
act in vacant posts.
Shortage of labour is bridged by subordinates who are qualified for more than one post.
It facilitates promotions, as the man who is promoted has a good knowledge of all the posts.
Organization Principle Nr 3: Span of control
A leader should supervise only as many people as he can control. The maximum number of subordinates over whom a leader can supervise depends on certain factors, namely:
The nature of the work that must be done, in other words, the variety as well as the intricateness thereof.
The area over which the subordinates are spread, in other words, how far they are placed from one another.
The leader himself, in other words, does he have the ability to lead, to inform and to control people?
The type of subordinates that the leader must control, are they qualified, discipline, etc.? Fully qualified subordinates, for instance, require less supervision and, to a great extent, this relieves the workload of the leader.
Organization Principle Nr 4: Management Accentuation
Leaders and any other category of workers tend to give preference to the kind of work, product or area in their sections with which they are best familiar.
This is mainly because they:
are more accomplished in a certain kind of work, as this is what they have done previously
prefer the work-area which is known to them, and
will prefer the work that they know well.
Activities of the organization process
When two or more individuals work together for the achievement of a common purpose, they are called a formal workgroup. The moment a formal workgroup is formed, a social organization is established, and the process of organizing begins.
Essentially, the organizing process moves from the knowledge of a goal or plan (obtained from the planning process) into a systematic division of work. It is concerned with a common effort to achieve set goals.
Typically the process follows the following steps.
Listing of all the tasks that must be performed by the organization to accomplish its objectives.
Dividing up these tasks into activities that each can be performed by one person. Each person will then have a group of activities to perform, called a job. (This, in turn, allows each person to become more proficient in his special job.)
Grouping related jobs in a logical and efficient manner. This creates specialized portions or sections of the organization.
Determining relationships between various people to promote collaboration by means of coordination and job and duty descriptions.
Delegating duties, authority and responsibility without abdicating final responsibility.
Developing an organization structure
An organizational structure is a specific framework of established posts in which people carry out certain actions, and are so grouped that they can pursue a common goal.
The formal organization structure
The advantages of a formal organization structure
The development of an organizational structure may be regarded as the means used by the leader, to group the work in such a way that it is most effectively done.
Defining and streamlining your organizational structure will help you get the most work done with the fewest people at the least cost, with the greatest satisfaction to the people doing the work. More specifically, here is what you can expect to achieve:
It creates order
It facilitates control
It promotes coordination
It benefits the individual worker
It creates formal communication channels
It regulates personnel relations regulates personnel relations
It ensures that all the important work necessary to your objectives will be done;
It divides the work logically so that teams can work effectively without barriers;
It ensures people have a balanced and challenging workloads that give them the opportunity to grow in scope and competence;
It identifies and defines career paths for which people can qualify by planned experience and training.
It encourages team-work by minimizing overlap and duplication of effort;
It promotes specialization so that people are utilized according to their abilities in the execution of certain tasks
It gives an overall picture of the field in which the organization operates.
The major characteristics of a formal organization
A formal organization has a well-defined structure.
Usually we can see a clearly defined relationship between the members of the organization – there are the rulers and the ruled; status, ranks and different levels of power and authority can be identified.
A formal organization has a precisely identified beginning.
We can usually pinpoint precisely when a formal organization came into being. There are normally written documents to mark the event.
A formal organization has a longer life span.
A formal organization usually lasts for a long time. There are changes of buildings and people after a lapse of years, but in the majority of cases a definite continuity of purpose can be traced.
A formal organization incorporates membership by choice.
Members join by choice and it is usually formal – and a contract exists between the member and the organization.
A formal organization has definite aims.
By this is meant that an organization tries to make particular things happen.
A formal organization employs the principle of division of work.
Conscious efforts are made by those belonging to a formal organization to share out the work required to achieve the aims of the organization. A general attempt to function as a unit, each doing his own part, without getting in the way of the others.
Responsibilities of the leader concerning the formal organization
he must be well acquainted with his own department’s organizational chart;
he must know what the relationship is between his department and other departments ;
he must make recommendations to improve the organization chart;
he must know what the functions are of the other departments in order to see what influence it may have on his objectives.
It is the leader’s responsibility to organize his part of the formal organization structure in such a way that effective performance and cooperation are obtained.
An organizational structure is something which is reasonably permanent and is a normal and logical result of organizing actions. Organizational structure is usually depicted in the form of an organizational chart which is a schematic representation of the way in which work is arranged.
Types of formal organization structures
Line organization (functional organization).
It is the simplest structure and provides the basic framework from which other types of structures are built. From this, it can be seen that line organization means that one person is the person in authority and that his authority filters through from highest to the lowest level. The person in control (manager) takes all the final decisions. Each person at a higher level has command authority over those a lower levels.
The following are the characteristics of a line organization:
Authority is vested in one person and staff only receive instructions from the head and report back to him.
One person is in control of a particular task or instruction.
Lines of authority are clear and each person’s task is clearly outlined as well as the responsibilities of each.
In a line and staff organization, the adviser (e.g. legal person) has advisory powers only, and may not enforce its authority. Those managers and leaders whose main job is to see what products and services are produced are usually considered members of the line organization. Other management people who help them to decide what to do and how to do or to act, or provide service or special expertise, are usually called staff people (person in a specialized capacity. The formal organization has created positions with management authority, responsibilities and accountability. The formal organization expects that the chain of command upwards and downwards should be followed. Interaction should thus be through the next higher level of authority or the next lower level of authority.
The aim of the organization is used as a basis. The functions are then determined by establishing what should / can / must be done in order to achieve that aim. These functions then serve as aims for the next subordinate organizational level. From these subordinate aims, the functions for that level are determined. This process is then repeated down to the lowest functional level.
Divisional or product organization
All functions needed to make a particular product, for example, are gathered under one highly placed manager. The function of the organization becomes the aim of the division. (Note that under each division head, the organization is essentially a functional one. Labels such as divisional and functional can be misleading.)
For specific projects, it is common practice that all people working on that project be grouped together to facilitate coordination, communication and control. After the completion of the project, they will then go back to their original sections.
A firm may divide some of its activities, such as sales, or all of its activities, according to the geographic region where these take place.
A company may also choose to organize some or all of its activities according to the customers it serves, such as farmers, contractors and homeowners. This kind of organization is closely related to the product organization.
The informal organization
Informal organization refers to the creation of informal relationships within the formal organization. informal group formation is the spontaneous reaction following the interaction and communication among the members of the organization.
The requirements for membership of informal groups are often not very clearly delineated. There are a variety of reasons for their membership, such as the need to belong, the need for friendship, own values, habits, status and emotional security.
The particular meaning of informal groups in an organization is usually twofold:
Informal groups have a powerful effect on the members. The attitudes, outlook and behaviour of group members are to a large extent prescribed by group norms and standards of behaviour and determined by group pressure
Informal groups are structured and each has a leader who is the embodiment of the interests of the particular group. Because these informal groups are formed in a natural way and by personal choice, these informal leaders often exert great influence on the members of a specific group.
The influence of an informal organization on the formal organization cannot be negated.
Advantages of an informal organization
The leader can use this informal leader to relieve his burden by delegating certain work to him.
The leader can use this informal leader to help him to get a cohesiveness amongst the members of the group.
Effective control can be exercised.
Provide social satisfaction to its members.
Assist in integrating new staff
Provides informal channels of communication, or leader can use the informal leader as a communication source.
It is important that the manager of an organization should take note of both the formal and informal organization. The latter should be investigated constantly and the advantages used for the benefit of the organization. If there is a conflict between leader and informal leader, the following problems can occur:
disagreement amongst group members;
Creation of relationships within an organization
This organizing activity can be compared with a large symphony orchestra. The conductor succeeds in stringing together the different musicians as a team so that each one produces the right note at the right moment. There are harmony and progress. Each musician is trained in his specific direction. He knows his part of the music and knows how it influences the ensemble.
No member over-plays his part of the music or interferes with or attempts to play the part of another member. Each one disciplines himself and is also disciplined by the conductor. Each one knows what his responsibility and authority are.
If it is made applicable to the work situation, you will agree that at times problems arise which you cannot solve because it does not fall within your field of specialization. In order to do away with certain problems, you will obtain advice from other specialists in your own or another department/section. This relationship between you and the other staff specialists falls under the subject of ‘line-staff’ relationships.
Line-staff and staff-line relationships within an organization
Each leader has, by the nature of his position, certain authority at his disposal, and he, therefore, has a certain relationship towards colleagues, subordinates, etc. which can be either a line/staff or staff/line relationship. Where the relationship is of such a nature that the leader is given advice by others, or where he stands in a leader capacity towards others, the leader’s relationship towards them is called a line-relationship. He, therefore, has command-authority which empowers him to make final decisions with regard to the goals which must be attained.
The leader’s subordinates are, however, in a staff-relationship towards him, as they can provide him with ideas and advice. Decisions are made at line-level and communicated downwards. Staff again makes recommendations and gives advice which is communicated upwards.
At some time or other, therefore, every one of us acts in a staff- or a line-capacity. Seniority, therefore, does not always play a role in the relationship.
In the relationship with one another, a few rules exist, which can be born in mind to eliminate possible friction which may occur. Therefore, in order to keep work and relationships on a healthy footing, we must attempt to comply with the undermentioned rules:
Persons in a line position make the final decisions within an organization
We have already seen that persons in the line position finally decide on matters. They must inform staff of the decision.
Persons in a staff position give advice or deliver services within an organization
It often happens that we negotiate with staff specialists, viz. people in other sections who give us specialized advice in order to help us reach our goals. Staff specialists can offer help voluntarily, but they can also be asked for it. As already mentioned, the line is not forced to accept the advice but is desirable that the advice should at least be considered.
Persons in line positions within an organization must consider advice from persons in staff positions
After a suggestion has been made by staff specialists, the line must determine whether or not it is accepted. The advice or suggestion given by the staff specialist must never be taken up too lightly. You must remember that lie has a problem and because they cannot solve it, they consulted staff. The suggestion made by staff will, therefore, be derived from the staff’s knowledge or experience – staff, therefore, speaks from a position of authority.
Both parties have the right to appeal.
If a staff specialist has made a suggestion and feels that his case has merits and it is rejected by line, the parties can appeal to a higher authority within the organization for a decisive answer.