Welingkar’s Distance Learning Division
CHAPTER-07
ORGANIZATION
We Learn – A Continuous Learning Forum
Welingkar’s Distance Learning Division
Introduction
• Organization is a mechanism or structure which helps
the activities ...
Welingkar’s Distance Learning Division
TRANSLATION
He who does not make people
anxious and does not himself
become anxious...
Welingkar’s Distance Learning Division
Meaning
• Organization can be compared to a human body. The
human body consists of ...
Welingkar’s Distance Learning Division
Definition
• Organization is a harmonious adjustment of
specialized parts for the a...
Welingkar’s Distance Learning Division
Functions of organization
• Determination of activities
• Grouping of activities
• ...
Welingkar’s Distance Learning Division
Principles of organization
• Principles of definition
• Principle of objective
• Pr...
Welingkar’s Distance Learning Division
Principles of organization
• Principle for responsibility
• Principle of explanatio...
Welingkar’s Distance Learning Division
Principles of organization
• Principle of flexibility
• Principle of principle
• Pr...
Welingkar’s Distance Learning Division
Nature or Characteristics of Organization
We Learn – A Continuous Learning Forum
Di...
Welingkar’s Distance Learning Division
Importance of Organization or
Advantages of Organization
• Facilitate administratio...
Welingkar’s Distance Learning Division
Importance of Organization or
Advantages of Organization
• Places proportionate imp...
Welingkar’s Distance Learning Division
Classification of organization
A. Formal
B. Informal
We Learn – A Continuous Learni...
Welingkar’s Distance Learning Division
Formal organization
• The formal organization represents the
classification of acti...
Welingkar’s Distance Learning Division
Characteristics of formal organization
• Properly planned, based on delegated
autho...
Welingkar’s Distance Learning Division
Advantages of formal organization
• The definite boundaries of each worker is clear...
Welingkar’s Distance Learning Division
Arguments against formal organization
• In certain cases, the formal organization m...
Welingkar’s Distance Learning Division
Informal organization
• Informal organization is an organizational structure
which ...
Welingkar’s Distance Learning Division
Characteristics of informal organization
• Informal organization arises without any...
Welingkar’s Distance Learning Division
Characteristics of informal organization
• Informal organization can be found all l...
Welingkar’s Distance Learning Division
Advantages of informal organization
• It fills the gaps and deficiency if the forma...
Welingkar’s Distance Learning Division
Disadvantages of informal organization
• It has the nature upsetting the morality o...
Welingkar’s Distance Learning Division
Difference between formal and informal
organization
We Learn – A Continuous Learnin...
Welingkar’s Distance Learning Division
Difference between formal and informal
organization
We Learn – A Continuous Learnin...
Welingkar’s Distance Learning Division
Theories of organization
1. Classical theory
2. Neo-classical theory
3. Modern theo...
Welingkar’s Distance Learning Division
Classical theory
• Division of labour:
• Scalar of functional processes:
• Structur...
Welingkar’s Distance Learning Division
Characteristics of classical theory
• It is based on division of labour, objectives...
Welingkar’s Distance Learning Division
Criticism of classical theory
• This theory is based on authoritarian
approach.
• I...
Welingkar’s Distance Learning Division
Neo-classical theory
Contributions of neo-classical theory
• Person should be the b...
Welingkar’s Distance Learning Division
• Motivation theory: It is concerned with the
study motivation of employees.
• Deci...
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Art of Management - Management Principles

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Art of Management - Management Principles

  1. 1. Welingkar’s Distance Learning Division CHAPTER-07 ORGANIZATION We Learn – A Continuous Learning Forum
  2. 2. Welingkar’s Distance Learning Division Introduction • Organization is a mechanism or structure which helps the activities to be performed effectively. The Organization is established for the purpose of achieving the business objectives. Wherever may be the business objectives, there is a need of an organization. • The word ‘organization’ is derived the word ‘organism’ which means an organized body with connected interdependent parts sharing common life. We Learn – A Continuous Learning Forum
  3. 3. Welingkar’s Distance Learning Division TRANSLATION He who does not make people anxious and does not himself become anxious easily either; and he who is eithout joy, anger, fear or anxiety,:is my loved one. INTERPRETATION A good manager myst be calm and level-headed in all the situations. He should not be easily irritated or frustrated; not should he irritate or frustrate others. We Learn – A Continuous Learning Forum
  4. 4. Welingkar’s Distance Learning Division Meaning • Organization can be compared to a human body. The human body consists of hands, feet, eyes, ears, nose, fingers, mouth, etc. These parts are performing their work independently and at the same time, one part cannot be a substitute to another. The same principles can be identified in the organization also. • Each department performs its work independently and be a substitute to another. We Learn – A Continuous Learning Forum
  5. 5. Welingkar’s Distance Learning Division Definition • Organization is a harmonious adjustment of specialized parts for the accomplishment of some common purpose. • “Organization is that process of identifying and grouping the work to be performed, defining and delegating responsibility and authority and establishing relationships for the purpose of enabling people to work most effectively together in accomplishing objectives.” We Learn – A Continuous Learning Forum
  6. 6. Welingkar’s Distance Learning Division Functions of organization • Determination of activities • Grouping of activities • Allotment of duties to specified persons • Delegation of authority • Defining relationship • Co-ordination of various activities We Learn – A Continuous Learning Forum
  7. 7. Welingkar’s Distance Learning Division Principles of organization • Principles of definition • Principle of objective • Principle of specialization or division of work • Principle of coordination • Principle of efficiency • Principle of efficiency • Principle of uniformity • Principle of correspondence • Principle of unity of command • Principle of balance We Learn – A Continuous Learning Forum
  8. 8. Welingkar’s Distance Learning Division Principles of organization • Principle for responsibility • Principle of explanation • Principle of authority • Principle of leadership facilitation • Principle of equilibrium balance • Principle of continuity • Principle of span of control • Principle of exception We Learn – A Continuous Learning Forum
  9. 9. Welingkar’s Distance Learning Division Principles of organization • Principle of flexibility • Principle of principle • Principle of simplicity and homogeneity • Principle of unity of direction • Principle of joint decision We Learn – A Continuous Learning Forum
  10. 10. Welingkar’s Distance Learning Division Nature or Characteristics of Organization We Learn – A Continuous Learning Forum Division of labour Authority responsibility structure Communication ORGANIZATION Coordination Objectives
  11. 11. Welingkar’s Distance Learning Division Importance of Organization or Advantages of Organization • Facilitate administration • Increases the efficiency of management • Facilitates growth and diversification Ensures optimum utilization of material resources and human efforts • Adoption of new technology We Learn – A Continuous Learning Forum
  12. 12. Welingkar’s Distance Learning Division Importance of Organization or Advantages of Organization • Places proportionate importance to the various activities of the enterprise • Encourage creativity and initiative • Facilitate coordination • Facilitate training and development of managerial personnel • Prevents the growth of secret, influence and corruption We Learn – A Continuous Learning Forum
  13. 13. Welingkar’s Distance Learning Division Classification of organization A. Formal B. Informal We Learn – A Continuous Learning Forum
  14. 14. Welingkar’s Distance Learning Division Formal organization • The formal organization represents the classification of activities within the enterprise. Indicates who reports to whom and explains the vertical journal of communication which connects the chief executive to the ordinary and workers. We Learn – A Continuous Learning Forum
  15. 15. Welingkar’s Distance Learning Division Characteristics of formal organization • Properly planned, based on delegated authority, deliberately impersonal, responsibility and accountability at all levels of organization should be clearly defined. • Organizational charts are usually drawn. • Unity of command is normally maintained. • It provides of division of labour. We Learn – A Continuous Learning Forum
  16. 16. Welingkar’s Distance Learning Division Advantages of formal organization • The definite boundaries of each worker is clearly fixed. It automatically reduces conflict among the worked. • Overlapping of responsibility is easily avoided. • Buck passing is very difficult. • A Sense of security arises for from classification of the task. • There is no chance for favoritism in evaluation and placement of the employee. • It makes the organization less dependent on the task. We Learn – A Continuous Learning Forum
  17. 17. Welingkar’s Distance Learning Division Arguments against formal organization • In certain cases, the formal organization may reduce the spirit initiative. • Authority is for the sake of convenience of the employee without considering the need for using the authority. • It does not consider the sentiments and values of the employees in the social organization. • The formal organization may reduce the speed of informal communication. • It creates the problems of coordination. We Learn – A Continuous Learning Forum
  18. 18. Welingkar’s Distance Learning Division Informal organization • Informal organization is an organizational structure which establishes the relationship on the basis of the likes and dislikes of officers without considering the rules, regulations and procedures. The informal organization relationship exists under the formal organization the informal organization relationship or informal relation give a greeter job satisfaction and result in maximum production. We Learn – A Continuous Learning Forum
  19. 19. Welingkar’s Distance Learning Division Characteristics of informal organization • Informal organization arises without any external cause. i.e. Voluntarily. • it is social structure formed to meet personal needs. • Informal organization has in the organization chart. • It acts as an agency of social control. We Learn – A Continuous Learning Forum
  20. 20. Welingkar’s Distance Learning Division Characteristics of informal organization • Informal organization can be found all levels of organization within the managerial hierarchy. • Informal organization develops from habits, conduct, customs and behavior of social groups • There is no structure and definiteness to the informal organization We Learn – A Continuous Learning Forum
  21. 21. Welingkar’s Distance Learning Division Advantages of informal organization • It fills the gaps and deficiency if the formal organization. • Informal organization gives satisfaction to the workers and maintains the stability of the work. • It is useful channel of communication. • The presence of informal organization encourages the executives to plan the work correctly and act accordingly We Learn – A Continuous Learning Forum
  22. 22. Welingkar’s Distance Learning Division Disadvantages of informal organization • It has the nature upsetting the morality of the workers. • It acts according to mob psychology. • Informal organization indirectly reduces the efforts of management to promote greater productivity. • It spreads rumor among the workers regarding the functioning of the organization unnecessarily. We Learn – A Continuous Learning Forum
  23. 23. Welingkar’s Distance Learning Division Difference between formal and informal organization We Learn – A Continuous Learning Forum Sr. Formal Organization Informal Organization 1 It arises due to delegation of authority It arises due to social interaction of people 2 It gives importance to terms of authority and functions It gives importance to people and their relationship 3 The formal authority is attached to a position. No such authority is attached to a person. 4 It is created deliberately It is spontaneous and natural 5 Rules, duties and responsibilities of workers are given in writing No such rules and duties followed in informal organization.
  24. 24. Welingkar’s Distance Learning Division Difference between formal and informal organization We Learn – A Continuous Learning Forum Sr. Formal Organization Informal Organization 6 Formal organization comes from outsiders who are giving in writing. Informal organization comes from those persons who are objects of its control. 7 Formal authority flows from upwards to downwards Informal authority flows upwards to downwards or horizontally. 8 Formal organization may grow to maximum size Informal organization tends to remain smaller. 9 It is created for technological purposes It arises from man’s quest for social satisfaction 10 Formal organization is permanent and stable There is no such permanent nature and stability.
  25. 25. Welingkar’s Distance Learning Division Theories of organization 1. Classical theory 2. Neo-classical theory 3. Modern theory 4. Motivation theory 5. Decision theory We Learn – A Continuous Learning Forum
  26. 26. Welingkar’s Distance Learning Division Classical theory • Division of labour: • Scalar of functional processes: • Structure; • Span of control We Learn – A Continuous Learning Forum
  27. 27. Welingkar’s Distance Learning Division Characteristics of classical theory • It is based on division of labour, objectives and tasks of organization, Co-ordination of efforts. • It is concerned with formal organization. • it believes in human behavior of the employees. • It fixes a responsibility and accountability for work completion. We Learn – A Continuous Learning Forum
  28. 28. Welingkar’s Distance Learning Division Criticism of classical theory • This theory is based on authoritarian approach. • It does not give two easy communications. • It ignores the influences factures on individual behavior. • The generalizations of the classical theories have not been tested by strict scientific methods. We Learn – A Continuous Learning Forum
  29. 29. Welingkar’s Distance Learning Division Neo-classical theory Contributions of neo-classical theory • Person should be the basis of an organization • Organization should be viewed as a total unity. • Individual goals and organization goals should be integrated. • Communication should be moved from to top and from top to bottom. • Members usually belong to formal and informal groups and interact with others within each group or sub-group. We Learn – A Continuous Learning Forum
  30. 30. Welingkar’s Distance Learning Division • Motivation theory: It is concerned with the study motivation of employees. • Decision theory: Decision theory is on the bases that at all the levels the decisions are taken. We Learn – A Continuous Learning Forum

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