Concept and Principle of Organizing

Subject: Business Studies

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Overview

Organizing is a process of identifying activities and resources, grouping them on the basis of nature, forming structure, assigning the job, providing rights and duties and establishing the relationship between them. It is the process of forming organizational structure and technology. It is aimed at achieving the organizational objective.

Concept and Principle of Organizing

Concept of Organizing

Organizing is the next important function of management which involves arranging and structuring the work which is required to accomplish the organizational objectives. Normally organizing is known as structure, process, a group of people and function of management. To understand the concept of an organization, it is necessary to define the following terms.

  • As a structure:
    Organizing as a structure refers to a hierarchical arrangement of the position of the members and the department of an organization. It shows authority and responsibility relationship among the members. It identifies who is to command and who is to obey. It is the mechanism to direct, coordinate and control the activities. It is the static concept that cannot be changed easily and quickly.
  • As a process:
    Organizing as a process refers to the identification and grouping of activities to be done, assigning duties to the people, creating authority responsibility relationship and coordinating activities among the members and departments. It normally determines, arranges, group and assigns the task to its members. It is a dynamic concept as the activities can be arranged and changed according to the requirements of the company.
  • As a function:
    Organizing is an important function after planning. The manager of the company organize or collect resources such as manpower, money, material, machine, methods, etc. They are needed to put the action on the track. Without organizing function, it is not possible to move forward.
  • As a group of people:
    Organizing is the group or association of certain people created for certain specific economic interests or non-economic interests. It is guided by the policy or the rules of the company, school, colleges, hospital, government office, club, etc.

According to Koontz and Odonnel, "Essentially, it (Organizing) is the creation and maintenance of an intentional structure of roles."

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According to Stoner, "Organizing is the process of arranging and allocating works, authority, and resources among an organization’s members so that they can achieve an organizational goal".

Principle of Organizing

The principle of organizing guides the organizing function of management. Some principles are:

  1. Scalar Principle:
    It is also known as the ‘chain of command’. It is an unbroken line of command/ authority from the top level to the bottom of an organization. This chain of command should be short and clear. If it could be, the decision-making and communication will be more effective and efficient.

  2. Principle of flexibility:
    The organizational structure should be flexible. It should be adaptable to changing circumstances or situations. It should easily permit any expansion and replacement without dislocating the basic design of the organization.

  3. Principle of authority:
    Authority means the right and power. It is the tool that makes the manager able to accomplish the desired goals. Hence, the authority of each manager should be clearly defined and it should equal responsiveness.

  4. Principle of delegation:
    Under this principle of delegation of authority, rights, and power should be equal to responsibility so as to enable each manager to accomplish the task assigned to him/her.

  5. Principle of unity of command:
    According to the principle of unity of command, each subordinate should have one superior, whose command has to be obeyed. If a person is to receive a direction from several superior, it may result in confusion, chaos, conflict, and indiscipline. So, there should be unity of command in an organization.

  6. Principle of the span of control:
    The span of control is a principle or it is a device, with the help of which a number of subordinates can be controlled, their number can be determined and the activities can be supervised. A manager cannot handle an unlimited number of subordinates. Hence, it guides and helps to determine the numerical limit of subordinates to be supervised or controlled by the manager. If the numbers of subordinates are limited, a manager can control and supervise effectively. But the number of subordinates may vary depending upon the nature of the job, the competence of the manager and the quality of subordinates.

  7. Principle of unity of objectives:
    Organizing helps to achieve the goals and objectives of the organization which affects the organizational structure. So, the goals and objectives of an organization should be clearly defined. The objectives should be defined very clearly for each department, for each section and even for each position of the organizational structures. All the objectives should be unified in such a way that it could facilitate to concentrate all the efforts towards the attainment of an organizational goal.

  8. Principle of efficiency:
    The organization should increase its efficiency in such a way that the cost or expenditure of the mission and objectives of the enterprise below. An efficient organizational structure helps to operate the resources efficiently. Hence, it ensures optimum utilization of resources.

  9. Principle of a division of works:
    The division of work can be created where the separate nature of jobs can be performed. Effective departmentation as per the work and task can be created and it is an important principle of the organization.

  10. Principle of unity of direction:
    There should be one objective (unified objective) and plan for the group activities. If it could be a direction from the superior it will be the same to all subordinates. All the subordinates will be receiving the same direction in their respective works and thus under this principle of unity of direction, they will be free from dilemma about obeying diversified direction. This will also facilitate the verification and coordination of activities.

  11. Principle of simplicity:
    This principle emphasizes the simplicity of the organizational structure. If there exists a long member of levels in an organization, there is a possibility of difficulty in communication and coordination. It clears that the activities and the system of an organization should be simple and easy to understand.

  12. Principle of responsibility:
    The principle of responsibility makes the superior responsible for their authority. In a sound organization, the superior is responsible for the performance of subordinates. The authority can be delegated but not responsible.

  13. Principle of balance:
    There should be a proper and reasonable balance in works and activities and the size of departments within the organization. Further, there should also be a reasonable balance between centralization and decentralization. Overemphasis of any type and preferences to anyone should be avoided.

  14. Principle of specialization:
    The principle of effective organization provokes specialization. Under this principle of specialization, the total task of an organization is divided in such a manner that every person is confined to a single and particular job, which leads to specialization of work.

 

 

 

 

 

 

References:

Pokhrel, Dhurb Raj et.al., Business Studies-XII, Asmita Book Publication, Kathmandu

Poudyal, Santosh Raj et.al., Business Studies-XII, Asmita Book Publication, Kathmandu

Bhandari, Kedar Prasad, Business Studies-XII, Bundipuran Prakashan, Kathmandu

 

 

 

 

Things to remember
  1. Organizing as a structure refers to a hierarchical arrangement of the position of the members and the department of an organization.
  2. Organizing as a process refers to the identification and grouping of activities to be done, assigning duties to the people and coordinating activities among the members and departments.
  3. Organizing is the group or association of certain people created for certain specific economic interests or non-economic interests.

 Principle of organizing

  1. Principle of unity of objective
  2. Principle of efficiency
  3. Principle of the span of control
  4. Principle of the division of works
  5. Principle of unity of command
  6. Principle of unity of direction
  7. Principle of delegation
  8. Principle of simplicity
  9. Principle of authority
  10. Principle of flexibility
  11. Principle of balance
  12. Scalar Principle
  13. Principle of specialization
  • It includes every relationship which established among the people.
  • There can be more than one community in a society. Community smaller than society.
  • It is a network of social relationships which cannot see or touched.
  • common interests and common objectives are not necessary for society.
Questions and Answers

Organizing is an important function of management. Organizing involves arranging and structuring the work which is required to accomplish the organizational objectives. Normally organizing is known as structure, process, a group of people and function of management. Organizing brings together men, machines, materials and money to execute the plans. The concept of organizing can be defined in the following terms:

  • As a structure: Organization is the structural framework or mechanism of the relationship among the organizational members that can be presented in a chart. It defines the duties, responsibilities, authorities of the people for handling the job to achieve the common goals.  

According to Koontz and Odonnel, "Essentially, it (organization) is the creation and maintenance of an intentional structure of roles."

According to Stoner, "Organizing is the process of arranging and allocating works, authority, and resources among an organization’s members so that they can achieve an organizational goal".

  • As a process: Organization as a process refers to the identification and grouping of activities to be done, assigning duties to the people, creating authority responsibility relationship and coordinating activities among the members and departments. 

  • As a function: Organization is an important function after planning. The manager of the company organize or collect resources such as manpower, money, material, machine, methods, etc.

  • As a group of people: Organizing is the group or association of certain people created for certain specific economic interest or non-economic interest. It is guided by the policy or the rules of the company. School, colleges, hospital, government office, club, etc are the examples.

The principle of organizing guides the organizing function of management. Some principles are:

  • The principle of unity of objectives: Organization helps to achieve the goals and objectives of the organization which affects the organizational structure. So, the goals and objectives of an organization should be clearly defined. All the members of the organization must pursue for the attainment of common objective.
  • The principle of efficiency: Organization should increase its efficiency in such a way that the cost or expenditure of mission and objectives of the enterprise below. An efficient organizational structure helps to operate the resources efficiently. Hence, it ensures optimum utilization of resources.
  • Principles of the span of control:  A manager cannot handle an unlimited number of subordinates. Hence, it guides and helps to determine the numerical limit of subordinates to be supervised or controlled by the manager. If the numbers of subordinates are limited, a manager can control and supervise effectively. But the number of subordinates may vary depending upon the nature of the job, the competence of manager and quality of subordinates.  
  • The principle of a division of works. Division of work can be created where separate nature of jobs can be performed. Effective departmentation as per the work and task can be created and it is an important principle of the organization.
  • The principle of unity of command: According to the principle of unity command, each subordinate should have one superior, whose command has to be obeyed. If a person is to receive a direction from several superior, it may result in confusion, chaos, conflict, and indiscipline. So, there should be unity of command in an organization.
  • The principle of unity of direction: There should be one objective and plan for the group activities. If it could be a direction from the superior will be the same to all subordinates. One person should manage a group of activities that have a common goal. There should be one head and one plan for a group of activities.
  • The principle of delegation: Under this principle of delegation, authority, rights, and power should be equal to responsible so as to enable each manager to accomplish the task assigned to him/her.
  • The principle of simplicity:This principle emphasizes upon the simplicity of the organizational structure. A large number of levels may create the problems of effective coordination and communication in the organization. It clears that the activities and the system of organization should be simple and easy to understand.
  • The principle of authority: Authority means the right and power. It is the tool which makes a manager able to accomplish the desired goals. Hence, the authority of each manager should be clearly defined and it should equal to responsiveness.
  • The principle of responsibility: Principle of responsibility makes the superior responsible for their authority. In a sound organization, the superior is responsible for the performance of subordinates. The authority can be delegated but not responsibility.
  • The principle of flexibility:The organizational structure should be flexible enough to cope with changes in the external environment of the business. It should facilitate growth and expansion without any hindrance.
  • The principle of balance: There should be proper and reasonable balance between various parts of the organization. There should be appropriate balance between opposing patterns of organizing such centralization and decentralization, authority and responsibility, wide span and narrow span and so on.
  • Scalar Principle: It is also known as ‘chain of command’. It is an unbroken line of command/ authority from the top level to the bottom of an organization. This chain of command should be short and clear. If it could be, the decision-making and communication will be more effective and efficient.
  • The principle of specialization: The principle of effective organization provokes specialization. Under this principle of specialization, a total task of an organization is divided in such manner that every person is confined to a single and particular job, which leads to specialization of work.

 

Organizing is an important function of management. Organizing involves arranging and structuring the work which is required to accomplish the organizational objectives. Normally organizing is known as structure, process, a group of people and function of management. Organizing brings together men, machines, materials and money to execute the plans. The concept of organizing can be defined in the following terms:

  • As a structure: Organization is the structural framework or mechanism of the relationship among the organizational members that can be presented in a chart. It defines the duties, responsibilities, authorities of the people for handling the job to achieve the common goals.  

According to Koontz and Odonnel, "Essentially, it (organization) is the creation and maintenance of an intentional structure of roles."

According to Stoner, "Organizing is the process of arranging and allocating works, authority, and resources among an organization’s members so that they can achieve an organizational goal".

  • As a process: Organization as a process refers to the identification and grouping of activities to be done, assigning duties to the people, creating authority responsibility relationship and coordinating activities among the members and departments. 

  • As a function: Organization is an important function after planning. The manager of the company organize or collect resources such as manpower, money, material, machine, methods, etc.

  • As a group of people: Organizing is the group or association of certain people created for certain specific economic interest or non-economic interest. It is guided by the policy or the rules of the company. School, colleges, hospital, government office, club, etc are the examples.

The principle of organizing are stated and explained as below:

  1. The principle of unity of objective
  2. The principle of efficiency 
  3. The principle of the span of control
  4. The principle of a division of work
  5. The principle of unity of command
  6. The principle of unity of direction
  7. The principle of delegation
  8. The principle of simplicity
  9. The principle of authority
  10. The principle of responsibility 
  11. The principle of flexibility
  12. The principle of balance
  13. Scalar Principle
  14. The principle of specialization

The principle of organizing guides the organizing function of management. Some principles are:

  • The principle of unity of objectives: Organization helps to achieve the goals and objectives of the organization which affects the organizational structure. So, the goals and objectives of an organization should be clearly defined. All the members of the organization must pursue the attainment of the common objective.
  • The principle of efficiency: Organization should increase its efficiency in such a way that the cost or expenditure of mission and objectives of the enterprise below. An efficient organizational structure helps to operate the resources efficiently. Hence, it ensures optimum utilization of resources.
  • Principles of the span of control:  A manager cannot handle an unlimited number of subordinates. Hence, it guides and helps to determine the numerical limit of subordinates to be supervised or controlled by the manager. If the numbers of subordinates are limited, a manager can control and supervise effectively. But the number of subordinates may vary depending upon the nature of the job, the competence of manager and quality of subordinates.  
  • The principle of a division of works. Division of work can be created where separate nature of jobs can be performed. Effective departmentation as per the work and task can be created and it is an important principle of the organization.
  • The principle of unity of command: According to the principle of unity command, each subordinate should have one superior, whose command has to be obeyed. If a person is to receive a direction from several superior, it may result in confusion, chaos, conflict, and indiscipline. So, there should be unity of command in an organization.
  • The principle of unity of direction: There should be one objective and plan for the group activities. If it could be a direction from the superior will be the same to all subordinates. One person should manage a group of activities that have a common goal. There should be one head and one plan for a group of activities.
  • The principle of delegation: Under this principle of delegation, authority, rights, and power should be equal to responsible so as to enable each manager to accomplish the task assigned to him/her.
  • The principle of simplicity:This principle emphasizes upon the simplicity of the organizational structure. A large number of levels may create the problems of effective coordination and communication in the organization. It clears that the activities and the system of organization should be simple and easy to understand.
  • The principle of authority: Authority means the right and power. It is the tool which makes a manager able to accomplish the desired goals. Hence, the authority of each manager should be clearly defined and it should equal to responsiveness.
  • The principle of responsibility: Principle of responsibility makes the superior responsible for their authority. In a sound organization, the superior is responsible for the performance of subordinates. The authority can be delegated but not responsibility.
  • The principle of flexibility:The organizational structure should be flexible enough to cope with changes in the external environment of the business. It should facilitate growth and expansion without any hindrance.
  • The principle of balance: There should be a proper and reasonable balance between various parts of the organization. There should be appropriate balance between opposing patterns of organizing such centralization and decentralization, authority and responsibility, wide span and narrow span and so on.
  • Scalar Principle: It is also known as ‘chain of command’. It is an unbroken line of command/ authority from the top level to the bottom of an organization. This chain of command should be short and clear. If it could be, the decision-making and communication will be more effective and efficient.
  • The principle of specialization: The principle of effective organization provokes specialization. Under this principle of specialization, a total task of an organization is divided in such manner that every person is confined to a single and particular job, which leads to specialization of work.

 

On the basis of the management experts, the major principles of organizing are listed below:

  1. Scalar Principle:
    It is also known as ‘chain of command’. It is an unbroken line of command/ authority from the top level to the bottom of an organization. This chain of command should be short and clear. If it could be, the decision-making and communication will be more effective and efficient.

  2. Principle of flexibility:
    The organizational structure should be flexible. It should be adaptable to changing circumstances or situation. It should easily permit any expansion and replacement without dislocating the basic design of the organization.

  3. Principle of authority: 
    Authority means the right and power. It is the tool which makes the manager able to accomplish the desired goals. Hence, the authority of each manager should be clearly defined and it should equal to responsiveness.

  4. Principle of delegation
    Under this principle of delegation of authority, rights, and power should be equal to responsibility so as to enable each manager to accomplish the task assigned to him/her.

  5. Principle of unity of command:
    According to the principle of unity of command, each subordinate should have one superior, whose command has to be obeyed. If a person is to receive a direction from several superior, it may result in confusion, chaos, conflict, and indiscipline. So, there should be unity of command in an organization.

  6. Principle of the span of control:
    The span of control is a principle or it is a device, with the help of which a number of subordinates can be controlled, their number can be determined and the activities can be supervised. A manager cannot handle an unlimited number of subordinates. Hence, it guides and helps to determine the numerical limit of subordinates to be supervised or controlled by the manager. If the numbers of subordinates are limited, a manager can control and supervise effectively. But the number of subordinates may vary depending upon the nature of the job, the competence of manager and quality of subordinates.

  7. Principle of unity of objectives
    Organizing helps to achieve the goals and objectives of the organization which affects the organizational structure. So, the goals and objectives of an organization should be clearly defined. The objectives should be defined very clearly for each department, for each section and even for each position of the organizational structures. All the objectives should be unified in such a way that it could facilitate to concentrate all the efforts towards the attainment of an organizational goal.

  8. Principle of efficiency
    An organization should increase its efficiency in such a way that the cost or expenditure of mission and objectives of the enterprise below. An efficient organizational structure helps to operate the resources efficiently. Hence, it ensures optimum utilization of resources.

  9. Principle of a division of works:
    Division of work can be created where the separate nature of jobs can be performed. Effective departmentation as per the work and task can be created and it is an important principle of the organization.

  10. Principle of unity of direction
    There should be one objective (unified objective) and plan for the group activities. If it could be a direction from the superior it will be the same to all subordinates. All the subordinates will be receiving the same direction in their respective works and thus under this principle of unity of direction, they will be free from dilemma about obeying diversified direction. This will also facilitate the verification and coordination of activities.

  11. Principle of simplicity:
    This principle emphasizes the simplicity of the organizational structure. If there exist a long member of levels in an organization, there is a possibility of difficulty in communication and coordination. It clears that the activities and the system of an organization should be simple and easy to understand.

  12. Principle of responsibility:
    The principle of responsibility makes the superior responsible for their authority. In a sound organization, the superior is responsible for the performance of subordinates. The authority can be delegated but not responsibility.

  13. Principle of balance
    There should be a proper and reasonable balance in works and activities and the size of departments within the organization. Further, there should also be a reasonable balance between centralization and decentralization. Overemphasis of any type and preferences to anyone should be avoided.

  14. Principle of specialization:
    The principle of effective organization provokes specialization. Under this principle of specialization, the total task of an organization is divided in such a manner that every person is confined to a single and particular job, which leads to specialization of work.

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