Organizing Process, Structure and Its Importance as Management

Organizing Process

Organizing is a process of maintaining the flow of work and information and grouping of activities, identification of authority and responsibility of employees in the organization. Various steps of organizing process are as follows:

  1. Determination of objectives: In the first step of organizing process, the objective of the enterprises is to be determined. This determination of objective is the basic of organizing a process of the enterprise. Without determining objectives, an organizational process will not proceed and organizing function will become meaningless. Virtually, the organization structure is so designed which could help to accomplish the objectives. Thus, organization should have clear objective to achieve its goal.
  2. Identification of activities: The next step in organizing is to identify and determine the activities to be performed in order to achieve the goals. The activities should be identified considering the present and changing environment. The total work of the organization is systematically divided into various activities and sub-activities. It facilitates the assignment of duties and delegation of authority.

  3. Grouping Activities: After identifying the necessary activities closely related and similar activities are grouped into division and departments. The act of grouping of activities is called departmentation. Activities may be grouped on different bases. For example; Functions, product, territories, customers, etc.

  4. Allocation of duties and responsibility: Now the fourth step in the organizing process, is the assignment of the duties and the responsibilities. This assignment of job should be based as per the ability and capacity of the person to be assigned. Organizing has to allocate the duties and responsibilities of the person very carefully so as to achieve the departmental as well as organizational goals.

  5. A delegation of Authority: Delegation of authority is the most important device to ensure about the attainment of goals. Under the organizing process, the top level management should delegate authority to lower level management. While delegating authority, the responsibility should be delegated too otherwise, it will be meaningless. So, the authority and responsibility should be balanced.

  6. Coordination: In the last step of organizing process, coordination is given a due emphasis. For the successful operation of any organization, there should be proper and effective coordination between the activities and efforts of various departments.

Organizational Structure

Organizational structure is the network of authority and responsibility to the member. It is the mechanism that highlights position, department, and level of management. The structure is selected according to its requirement. Normally, the structure depends on the size of the organization. The common structure of organization are as follows:

  • Line organizational structure:

It is the simplest and oldest forms of organizational structure. It is also known as military organization because it is developed by the military. It is the organizational structure where authority flows downward and responsibility upward. It means order and instructions, communication, etc . flows upward to the manager. In this structure, there is direct lineup authority from top to bottom level through unbroken chain. It has a good working relationship between superior to subordinate level, i.e. from top to bottom. The principle of unity of command, scalar chain, a span of control, etc is strictly followed in this structure. The manager is independent in his area. Similarly, subordinates become responsible to the concerned manager for their performance. It is normally suitable for small organization. Its structure is shown:

Line organizational structure

  • Line and staff organizational structure:

It is the next type of organizational structure. It is an extended form of line organizational structure. In such organization, there is line authority and staff authority. It means the line manager and staff manager both are involved in performing the managerial activity. The line manager commands the subordinates and staff managers make a plan and suggest the line manager. In a large organization, it is not possible for the line manager to perform various activities by themselves. So, they need the support of specialist for doing the job properly. In this organizational structure, there is the provision of a chain of command as well as the provision of a functional specialist. Such as legal expert, financial advisor, labor experts, etc to provide suggestion to line manager in decision making.

The functional staffs are responsible for preparation of plan while line authorities are responsible for implementation of the prepared plan. Functional staffs are involved in only advisory work and have no authority to give action to the line manager and subordinates.


Line and staff organizational structure
  • Functional Structure

The organization is separated into different segments based on the functions while 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 having efficiencies within functional groups.

Importance of organizing as management function

  • Optimum utilization of human resources: A good organization utilizes the human resources properly. It places the right person in the right jobs in the right position and department. By matching interests and job, there would be optimum use of individual.
  • Effective and efficient administration: Organization defines the various activities and authority relationship in the organizational structure. A sound organization helps the management in many ways. For example, it helps to avoid confusion of the efforts. It is the mechanism with which the management directs, controls and coordinates the various functions of the enterprise.
  • Facilitates growth and diversification: A sound and effective organization contributes to the growth and diversification of the enterprise through the effective management. It is always accepted as truth that sound organization helps the management to implement decentralization, through which management can enhance its strength and then become large in its shape and size.
  • Provides optimum use of new technology: A sound organization is always flexible. As it is so, it has a capacity for absorbing changes in the environment. Hence, according to the situation and on the demand, it helps and let the management for the proper and optimum use of technological improvement.
  • Effective coordination and communication: It is only the organization of enterprise, which maintain coordination and establish communication among various departments and individual, along with a different level of the staffs. It helps to establish a structural relationship between different jobs and position. It also fixes the channel by communicating among different members.
  • Training and development: A sound and effective organizing function offers a good scope for the development of managerial ability and competency by providing training. It also helps the management to improve competency through proper delegation of authority.
  • Productivity and job satisfaction: Productivity of human resources can be increased when personnel of any organization is free to exercise their ideas. This is possible only in the organization where democratic and participative management exists.


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

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

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

Process of Organizing

  1. Determination of objectives
  2. Identification of activities
  3. Grouping Activities
  4. Allocation of duties and responsibility
  5. A delegation of Authority
  6. Coordination

Importance of organizing as management function

  1. Optimum utilization of human resources
  2. Effective and efficient administration
  3. Facilitates growth and diversification
  4. Provides optimum use of new technology
  5. Effective coordination and communication
  6. Training and development
  7. Productivity and job satisfaction

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