Unit 3_organising.pptx

Importance of organizing
• Organization is the foundation store upon which the
whole structure of management is built.
• Backbone of management.
1. To facilitate administration
2. To increases the efficiency of management
3. To facilitate growth and diversification
4. To ensure optimum use of man and material resources.
5. To facilitate co-ordination and communication
6. To permit optimum use of technological innovations
7. To simulate creativity
8. To facilitate the development of managerial ability.

1. To facilitate administration
- Administration aims to earn the highest profit.
- A properly designed organisation facilitates
both the management and operation of
enterprise.
- Organisation is the mechanism through which
managers direct , co-ordinate and control the
business.

2. To increases the efficiency of management
- Good org will use workers ability fully and
utilize the resources effectively.
- A well designed org avoids the duplication
and confusion in performance
- So, it automatically motivates the efficiency
of management

3. To facilitate growth and diversification
- The growth of business means an increase in
the scale of operation but the diversification
means the start of production of a new type
of products.
- Sound organization helps in keeping the
various activities under control and it
increases the capacity to do more work.

4. To ensure optimum use of man and material
resources.
- Division of work and specialisation are the tools
for achieving the optimum use of man and
material resources.
- Optimum use of human resources is achieved by
providing psychological satisfication to
employee.
- Right person are placed for the right job at right
time to commensurate their knowledge and skills

5.To facilitate co-ordination and communication
- The activities of different department are
grouped together to achieve the business
objective.
6.To permit optimum use of technological
innovations
- Organisation structure is not rigid, it is flexible
and provides scope for innovative changes in
the enterprise by wake of new departments

7. To simulate creativity
- It provides an opportunity for the staff to show their
hidden talents which will help the enterprise to
achieve the business goals with higher rate of profits
8. To facilitate the development of managerial ability.
- The managerial personnel are trained to acquire a
wide and varied experience in diverse activities
through job rotation.
- This makes them responsible to accept the various
challenges to be faced by the organisation.

Bases for Departmentation :
• Function
• Product
• Territory
• Process
• Customer
• Time
Internal Operation oriented bases- Function, Process and
Time
External Operation oriented bases - Product, Territory
and Customer

Forecasting
• Quantitative Forecasting
Set of mathematical rules to series of past data to
predict outcomes.
Qualitative Forecasting
Uses judgment and opinions of knowledgeable
individuals to predict outcomes.

Contingency Planning
• Identifying actions to take when a strategic or
tactical plan must change based on circumstances
(good or bad)/(day to day problems)

Benchmarking
• Comparing your company to outside
organizations both in your industry and in other
businesses.
• The search for the best practices among
competitors and non-competitors.

Benchmarking Steps
• Form a benchmarking planning team
• Identify
• Gather internal and external data
• Analyze data to identify performance gaps
• Prepare and implement action plan

Participatory Planning
• Including those impacted and/or who will
implement your plan in the process

Developing clear quantified measures that
guides the orgs. and the individuals work
Goal Setting

Centralization and
Decentralization

• Decentralization
Decision-making capabilities delegated across
multiple Levels
• Centralization
Decision-making capability rests with the top
management

• Centralization and Decentralization refers the
location of decision making authority in an
orgnisation.
• Louis A. Allen has defined both the terms as
Centralization is the systematic and
consistent reservation of authority at central
points within an organization.
• Decentralization applies to the systematic
delegation of authority in an organization wide
context”

Types of centralization
• Departmental centralization- Ex HR
• Centralization of performance- Location
• Centralization as an aspect of management –
restrict decision making

Advantages of decentralisation
1. Reduces the burden of management
2. Encourages decision making
3. Facilities growth and diversification
4. Enables the department staff members
5. Encourages the development of superiors by
providing them opportunities to take more
responsibility
6. Increases motivation
7. Emphasis on horizontal growth of the
organisation thereby reducing the number of mgt
levels and increasing the span

Disadvantages of decentralisation
1. Difficult to have uniform policy and procedure
2. Complexity in coordination
3. Will create disorder
4. Possibility of duplication of work
5. Increase the cost of operation
6. Requires the high degree of self-motivation
and self-control

Span of Control
Means number of subordinates under a manager.
 Group of subordinates who report to a manager
directly.
 It is divided into two aspects :
1. Wide Span
2. Narrow Span

Span of Management
Two implications :
• Influences the complexities of the individual
managers job.
• Determine the shape or configuration of the
organization.

• There will be less hierarchical levels and
organizational structure would be flatter.
• Difficult to handle most people.

Narrow Span
• The hierarchical level increases, hence the
organizational structure would be tall.
• It requires more managers, so expensive.
• Takes time to communicate and to reach.
• Lack of coordination and control.

• Organization structure is the formal pattern of
interactions and coordination designed by
management to link the task of individuals and
groups in achieving the organisational goals.

Significance of organisational
structure
1. Properly designed organisation can help to improve
the team work and productivity by providing a
frame work
2. It determines the location of decision making in
the org.
3. Stimulates creative thinking and initiative among
org members
4. Facilitates the growth of enterprise
5. Provides the pattern of communication
6. Help a member to known what his role is and how
it relates to others roles .

Types of org structure
Based on the power flow within the org
1. Bureaucratic or mechanistic structure
2. Organic or adaptive structure.
Based on the formation of departments or groups in
the organisations
1. Functional structure
2. Divisional structure
3. Matrix structure
4. Team structure
5. Network structure

1. Bureaucratic or mechanistic structure
based on logical order and the appropriate use
of formal authority.
this features include clear-cut division of
labor ,strict hierarchy of authority, formal
rules and procedures and promotion based on
competency.

• Features of bureaucratic structure:
1. Administrative class is responsible for the
coordination of members.
2. Clearly specified tasks using division of work
principles.
3. Precise definitions of the rights and obligations of
members.
4. Clearly defined hierarchy
5. Org is governed by official written rules and
regulation .
6. Tendency towards formal communication through
out the organisation structure
7. Maintenance of proper official records of various
activities

Best example of bureaucratic structure is found
in college and university.
Drawback of bureaucratic structure
1. Only suitable for fairly stable external
environment condition.
2. Lack of flexibility
3. Too rigid rules may make organisational
objective secondary
4. Neglect informal organisation and
interpersonal difficulties

Organic and adaptive structure
- Opposite in nature to bureaucratic structure
- Maintains high degree of openess to input
from the internal and external environment.
- This work better in dynamic environment
where managers need to react quickly to
changes.
- It is much less formal and much more flexible
than a bureaucratic structure

• Features of organic organisation
1. Roles are not highly defined
2. Task that are continually redefined
3. Little reliance on formal authority
4. Decentralized control
5. Fast decision making
6. Informal patterns of both delegation and
communication.

Functional structure
-most popular org structure in the business world
- It is based on similar activities, skills,
expertise and resources
- Production marketing finance R&D and
human resources are common groupings
within the functional structure

advantage of functional structure
1. Well-defined channels of communication
2. Faster stability and efficiency
3. Improves productivity by minimizing
duplication
4. It makes employees comfortable and
simplifies training
5. High degree of coordination and control

Disadvantage
1. It result the narrowed perspectives because of the
separateness of different department as work groups
2. Communication and collaboration between
different departments is difficult.
3. Authority is more centralized.
4. Creates more conflicts
5. It gives managers experiences in only their own
field
6. Lack of response necessary to cope up with new
and rapidly changing work requirement

Divisional structure
- Org is divided into several fairly
autonomous division. According to the
organizational outputs.
- Each division is headed by a manager. Each
division has its own production, marketing,
R&D and finance departments.

Advantage of divisional structure
1. It develops managerial skills and executive
skills because people in this structure are
exposed to all of the other functions.
2. It improves the ability of a company to
respond to customer issues.
3. Organizational size can be increased without
any problem.
4. Performance can be measured in the view of
contributions made by the division.

Disadvantage of divisional structure
1. Redundant effort and resources are due to
multiple departments performing the same
tasks across the organisation.
2. Costly because of duplication of departments
in each division.
3. A complex control system is required.

Matrix structure
Matrix structure is a hybrid organisational
form containing characteristics of both
functional and division structural.
- Developed to meet the problem of growing
size and complexity of undertakings.
- It is created by merging the two structure it
violates the principle of unity of command

• Some times matrix and divisional structure are same.
But they are different.
• In divisional structure, separate groups are created for
taking and managing projects. A complete
responsibility from top to bottom is assigned to one
project manager.
• But in matrix structure, a project manager is usually not
assigned. Instead he shares them with others in the
organisation.
• Divisional structure is suitable for small number of
major projects, where as matrix organisation is suitable
for large number of small projects.

• In matrix when one project is completed its
resources are redirected to other projects.
• In matrix organisation there is a permanent set of
functional groups.
• Temporary project groups are created to
handle infrequent short-term projects.
• Personnel are drawn from functional groups, their
activities are coordinated and controlled by the
project manager.
• When the project is completed, the personnel are
returned to their original departments

Advantages
1. Focuses resources on a single project.
2. More flexible than the traditional functional
organisation.
3. Knowledge and experience can be transferred from
one project to another project.
4. Good motivation to the personnel in the project
5. A better balance among time, cost and performance.
6. Most of the decision are taken at lower level.
7. Responsibility for overall execution, management and
profit is with the project manager who act as a chief
executive.

disadvantages
• Use of multiple commands, manager often end
up with conflicts.
• Org relationship becomes very complex and
there is a great confusion among personnel.
• A matrix org is created by deputing the staff
temporarily from different functional
departments. Project managers do not have any
line of authority over such persons, which
result in lack of commitment.

Team structure
• The team structure organise the separate
functions into a group based on one overall
objective.
• These cross-functional teams are composed of
members from different departments
• The intention is to break down the functional
barriers among departments and create a more
effective relationship for solving ongoing
problems.

Advantages and disadvantage
• Intradepartmental barriers break down.
• Decision-making and response time speed up.
• Employees are motivated.
• Levels of manager are eliminated.
• Administrative costs are lowered.
Disadvantage :
• Conflicting loyalties among team members.
• Time management issue.
• Increased time spend in meetings.

• Organisation requires the service of a large
number of human resources.
• Occupies varies position
• Each position requires specific knowledge and
skills
• HR management is also known as staffing
• Staffing basically matching the jobs on
individuals

HR mgt is the process of
• Recruitment,
• Selection of employee
• Providing proper orientation and induction
• Proper training and development
• Proper compensation and benefits
• Proper relation with labour
• Maintaining employee’s safety,
• Welfare, health by complying with labour laws
of concern state

Importance of HR
1. Increase in number of employee
2. Technological innovations which requires
more skilled and experienced staff.
3. Increasing the % of woman employee.
4. Widening the function of the mgt

Need of HR mgt
• It helps company to achieve its objective from
time to time by creating a positive attitude
among workers.
• Helps the org to maintain co-ordinal relationship
• Effective utilization of skills and potential.
• Teach team work and adjustment which
improve productivity
• Right people for right job

Activities (scope) comes under HR
mgt
1. HR planning – jobs vacant, excess staff or
shortage of staff
2. Job analysis and design- detailed
explanation about each and every job in the
company
3. Recruitment and selection
4. Orientation and induction- to give
information about the company and org
culture work ethics

5. Training and development
6. Performance appraisal – future promotions,
increments, incentives.
7. Compensation and remuneration
8. Motivation, welfare, health and safety
9. Industrial relations- maintains Co-ordinal
relationships, to prevent strikes, lockouts and
ensure smooth working in the company.

Factors affecting HR mgt
I) external factors
1. Political factors
2. Economic factors
3. Social factors - caste, religion and culture
4. Legal factors
5. Customers

II) internal factors
1. Size of organisation
2. Organisational image
3. Technological factors
4. Changes in employee roles.
5. Education – well educated empoyees is a
problem to the organisation though the make
valuable contributions.

Function of HR management
Managerial function
1. Planning- number and type of employees
needed to achieve the org goals
2. Organizing – assignment of duties
3. Directing –supervising and guiding
4. Controlling – measuring employee’s
performance and taking corrective action

Operative function
• Employment
• Development
• Compensation
• Relations – these are to be performed in
conjunction with managerial function

Employment
• It is concerned with procuring and employing the
people possessing necessary skills, knowledge,
attitude. This covers the following function
1. Job analysis
2. HR planning
3. Recruitment
4. Selection
5. Placement
6. Induction and orientation

Development
• Process of improving, changing, developing the
skills, knowledge, creativity, attitude based on
the present and future job and org requirements
• This covers the following function
1. Performance appraisal
2. Training and development
3. Org development

Compensation
• Process of providing equitable and fair
remuneration to employee.
• This covers the following function
1. Wage and salary
2. Social security, incentives

Human Relations
• Integrating people into work situation
• Motivates them to work together cooperatively
with economic, social satisfaction

Definition
• The process of identifying the number of
people required by an organisation in terms of
quantity and quality.
• Through HR process, the management ensures
the right person who are capable of
completing tasks that help the organisation to
reach its objectives.

Features of HR planning
1. Assess the future requirement of manpower
2. Continuous process due to change in
environment
3. Focuses on optimum utilization of resources
4. Determining the demand and supply of HR
5. Determines right number and right kind of
people at right time
6. Internal part of overall corporate plan of the
organization.

Need for HR
• Large number of employees got retire, die,
leave organisations and need to be replaced.
• Technological changes and globalisation leads
to change in production methods
• To meet the need of expansion and
diversification of programmes of an
organisation

Process
1. Assessing the current HR capacity
knowledge skills and abilities of current staff
need to be identified
2. Forecasting HR requirements
future needs based on the strategic goals of the
org, involves demand and supply
3. Gap analysis
determine the gap between where the org desires
to be in the future and where it is now
4. Developing HR strategies to support org
strategies

Recruitment
• A process to discover the sources of manpower
to meet the requirements of the staffing
schedule and to employ the effective measures
for attracting that manpower in adequate
numbers to facilitate effective selection of an
efficient work force

Sources of recruitment
1. Internal
• Present employee
• Former employee
• Employee referrals
• Previous applicants
2. External
• Employment exchange,
• Advertisement
• Trade union
• Employment agencies
• Educational and training institutes

Selection
• Pick up the candidates with the required
qualifications, training, skills for the job after
careful screening and rejecting the undesirable at
each step
• Selection process – no standard process
1. screening of application
2. selection tests
3. preliminary interview – eliminating the
undesirable things and unsuitable candidates
4. reference check - application form are
contacted to cross check the candidate’s character,
performance and behavior

5. Medical examination
6. Final interview
7. Approved by appropriate authority
8. Placement- placed on their jobs initially on
probation basis

Interview
• According to scott and others “ an interview is
a purposeful exchange of ideas, the answering
of questions and communication between two
or more persons”

Types of interview
1. Preliminary interview
• Informal – gather information about vacancies, salary, nature
etc.
• Unstructured – freedom to talk about themselves and previous
experience
2. Core interview
• Background information interview – family, hobbies, dislikes etc
• Formal and structured- formal procedure like timings,
interviewer names and questions
• Stress interview
• Group interview – like GD
• Panel interview- panel of experts and weightage of each
• Depth interview- knowledge and skill of candidate
3. Decision making interview – inform about top management
policies like salary range, promotions

Test
1. Aptitude test
2. Intelligence test- verbal and non-verbal
3. Psychomotor test – physical strength
4. Personality test –leadership patience and self
confidence.
5. Vocational test – candidate interest and
occupation

Training and development
• Training is the act of increasing the knowledge and
skills of an employee for doing a particular job.
Factors :
1. Change in technology
2. Organizational complexity
3. Human relation
Importance of training
- Reduces accident
- Provides stability and flexibility
- Standardizing the methods
- Increased productivity
- Reduce learning time

Training methods
• Training input – skills- attitude-knowledge
• On the job training
1. job rotation
2. apprenticeship or coaching
3. committee assignment
4. experience or understudy(Assistant)
5. temporary promotion

Off the job training
1. Lecture
2. Conference and seminar
3. Role-play
4. Case studies
5. Business game
6. In basket- method- basket contains a number of
correspondences such as memos, circulars letters
and reports which all describe the real time problems
the trainees are required to solve each problem and to
record their decision within a specific time period

Performance mgt
• Performance mgt is a process by which
managers and employee work together to plan
monitor and review an employee work
objective and overall contribution to the org.

Barriers of performance appraisal
system
• Faulty assumption
• Psychological barriers- feeling of insecurity,
appraisal as an extra burden.
• Halo effect – it is the tendency of the raters to
depend excessively on the ratee’s one or two
outstandingly good performance in rating all
other traits
• Personal prejudice

Methods of performance appraisal
• Trait-based appraisal
• Job knowledge
• Leadership skills
• Analytical competence
• Judgment ability
• Loyalty

Graphic scale method- employee characteristics
and employee contribution
Ranking method-
Grading- excellent, very good, average, poor etc.
Check list method- many number of yes or no
condition
Critical incident method- based on key incidents.
A stress is given on the behaviour of the
worker on the job.

2. Appraisal by result
MBO
BARS( Behaviourally Anchored Rating Scales)
-combines the elements of traditional traits
scales and critical incident methods
Assessment centers - area polls

Career Planning and
Management

• Edwin B. Flippo defined a career as a
sequence of separate but related work activities
that provide continuity, order and meaning in
person’s life
• Types
1. Individual career
2. Organisation career

Career Mgt
• Two essential components
1. Career planning – the process by which
employee obtain the knowledge about
themselves and information about the working
environment and then making an effort to
achieve a proper goal
2. Career development – ongoing process by
which individual progress through a series of
stages each of which is characterized by a
relatively unique set of issues, themes or tasks.

Career stages
1. Exploration stage
(adolescence period age: 15 to 25) – during
which persons seriously explores various
occupational alternatives attempting to match
these alternatives with his or her interest and
abilities.
2. Establishment stage
(early adulthood period age:25 to 35)- begins
with the individuals entry into the world of work
ideally in a position which matches the
organisational needs with individual needs

3. Mid-career or advancement stage (later
adulthood period age:35 to 45)
 upward movement in the organisation
4. Late-career or maintenance stage
(middle age, from about 45 to 65)
no longer learning about their jobs nor
expected to exceed levels of performance from
previous years
5. Decline or Disengagement stage
(old age, from about 65 years onwards)
marked by retirement

Unit 3_organising.pptx

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Unit 3_organising.pptx