2.

20 Organizing Function of Management

This is the function in which the synchronization and combination of the following resources
takes place:-
 Human resources
 Physical resources
 financial resources
All the three resources are important to get results.
A manager performs organizing function with the help of following steps:-
1. Identification of activities
 All the activities which have to be performed in a concern have to be identified first.
For example,
 preparation of accounts, making sales, record keeping,
All these activities have to be grouped and classified into units.
1. Departmentally organizing the activities

 The manager tries to combine and group similar and related activities into units or
departments.
 This organization of dividing the whole concern into independent units and
departments is called departmentation.

2. Classifying the authority

 This activity of giving a rank in order to the managerial positions is called hierarchy.
 The top management is into formulation of policies,
 the middle level management into departmental supervision
 lower level management into supervision of foremen.
 The clarification of authority help in bringing efficiency in the running of a concern.
 This helps in avoiding wastage of time, money, effort, in avoidance of duplication or
overlapping of efforts and this helps in bringing smoothness in a concern’s working.
3. Co-ordination between authority and responsibility

 Each individual is made aware of his authority and he/she knows whom they have to
take orders from and to whom they are accountable and to whom they have to
report.
 A clear organizational structure is drawn and all the employees are made aware of it.

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2.20 IMPORTANCE OF ORGANIZING FUNCTION
1. Specialization
 Organizational structure is a network of relationships in which the work is divided
into units and departments.
 This division of work is helping in bringing specialization in various activities of
concern.
2. Well defined jobs
 Organizational structure helps in putting right men on right job
 This can be done by selecting people for various departments according to their:-
o qualifications,
o skill
o experience.
3. Clarifies authority
 Organizational structure helps in clarifying the role positions to every manager
(status quo).
 This can be done by clarifying the powers to every manager and the way he has to
exercise those powers should be clarified so that misuse of powers do not take
place.
4.Co-ordination
 Organization is a means of creating co- ordination among different departments of
the enterprise.
 It creates clear cut relationships among positions and ensure mutual co- operation
among individuals.
5.Effective administration
 The organization structure is helpful in defining the jobs positions.
 The roles to be performed by different managers are clarified.
 Specialization is achieved through division of work.
 This all leads to efficient and effective administration.
6. Growth and diversification
 A company’s growth is totally dependant on how efficiently and smoothly a concern
works.
 Efficiency can be brought about by clarifying the role positions to the managers, co-
ordination between authority and responsibility and concentrating on specialization.
7. Sense of security
 Organizational structure clarifies the job positions.
 The roles assigned to every manager is clear.

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2.30 Principles of Organizing
 The organizing process can be done efficiently if the managers have certain
guidelines so that they can take decisions and can act.
 To organize in an effective manner, the following principles of organization can be
used by a manager.
a) Principle of Specialization
 According to the principle, the whole work of a concern should be divided amongst
the subordinates on the basis of qualifications, abilities and skills.
 It is through division of work specialization can be achieved which results in effective
organization.
b) Principle of Functional Definition
 According to this principle, all the functions in a concern should be completely and
clearly defined to the managers and subordinates.
 This can be done by clearly defining the duties, responsibilities, authority and
relationships of people towards each other.
 Clarifications in authority-responsibility relationships helps in achieving co-ordination
and thereby organization can take place effectively.
 For example, the primary functions of production, marketing and finance and the
authority responsibility relationships in these departments should be clearly defined
to every person attached to that department.
 Clarification in the authority-responsibility relationship helps in efficient
organization.
c) Principles of Span of Control/Supervision
 According to this principle, span of control is a span of supervision which depicts the
number of employees that can be handled and controlled effectively by a single
manager.
 According to this principle, a manager should be able to handle what number of
employees under him should be decided.
 This decision can be taken by choosing either from a wide or narrow span.
There are two types of span of control:-
Wide span of control
 It is one in which a manager can supervise and control effectively a large group of persons
at one time.
The features of this span are:-
 Less overhead cost of supervision
 Prompt response from the employees
 Better communication
 Better supervision
 Better co-ordination
 Suitable for repetitive jobs
According to this span, one manager can effectively and efficiently handle a large number of
subordinates at one time.

Narrow span of control

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  According to this span, the work and authority is divided amongst many
subordinates and a manager doesn't supervises and control a very big group of
people under him.
 The manager according to a narrow span supervises a selected number of employees
at one time.
The features are:-
Work which requires tight control and supervision, for example, handicrafts, ivory work, etc.
which requires craftsmanship, there narrow span is more helpful.
 Co-ordination is difficult to be achieved.
 Communication gaps can come.
 Messages can be distorted.
 Specialization work can be achieved.

Factors influencing Span of Control

i. Managerial abilities
 In the concerns where managers are capable, qualified and experienced, wide span
of control is always helpful.
ii. Competence of subordinates
 Where the subordinates are capable and competent and their understanding levels
are proper, the subordinates tend to very frequently visit the superiors for solving
their problems.
 In such cases, the manager can handle large number of employees.
 Hence wide span is suitable.
iii. Nature of work
 If the work is of repetitive nature, wide span of supervision is more helpful
 . On the other hand, if work requires mental skill or craftsmanship, tight control and
supervision is required in which narrow span is more helpful.
iv. Delegation of authority
 When the work is delegated to lower levels in an efficient and proper way,
confusions are less and congeniality of the environment can be maintained.
 In such cases, wide span of control is suitable and the supervisors can manage and
control large number of sub- ordinates at one time.
v. Degree of decentralization
 Decentralization is done in order to achieve specialization in which authority is
shared by many people and managers at different levels.
 In such cases, a tall structure is helpful.
 There are certain concerns where decentralization is done in very effective way
which results in direct and personal communication between superiors and sub-
ordinates and there the superiors can manage large number of subordinates very
easily. In such cases, wide span again helps.
d) Principle of Scalar Chain
 Scalar chain is a chain of command or authority which flows from top to bottom.
 With a chain of authority available, wastages of resources are minimized,
communication is affected, overlapping of work is avoided and easy organization
takes place.
 A scalar chain of command facilitates work flow in an organization which helps in
achievement of effective results.

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  As the authority flows from top to bottom, it clarifies the authority positions to
managers at all level and that facilitates effective organization.
e) Principle of Unity of Command
 It implies one subordinate-one superior relationship.
 Every subordinate is answerable and accountable to one boss at one time. This helps
in avoiding communication gaps and feedback and response is prompt.
 Unity of command also helps in effective combination of resources, that is, physical,
financial resources which helps in easy co-ordination and, therefore, effective
organization.
Authority Flows from Top to Bottom
 
Managing Director
↓
Marketing Manager
↓
Sales/ Media Manager
↓
Salesmen

2.40 Delegation In Management

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  Delegation of Authority means division of authority and powers downwards to the
subordinate.
 Delegation is about entrusting someone else to do parts of your job.
 Delegation of authority can be defined as subdivision and sub-allocation of powers
to the subordinates in order to achieve effective results
2.41 Elements of Delegation
i) Responsibility
Responsibility indicates the duty assigned to a position.
 The person holding the position has to perform the duty assigned. It is his
responsibility.
 The term responsibility is often referred to as an obligation to perform a particular
task assigned to a subordinate.

Definitions of Responsibility
a) According to Davis,
 "Responsibility is an obligation of individual to perform assigned duties to the best of
his ability under the direction of his executive leader."
b) In the words of Theo Haimann,
 "Responsibility is the obligation of a subordinate to perform the duty as required by
his superior".

ii) Authority
Authority is the right or power assigned to an executive or a manager in order to achieve
certain organizational objectives.
Definitions of Authority
According to Henri Fayol,
"Authority is the right to give orders and the power to exact obedience."

According to Mooney and Reily,

 "Authority is the principle at the root of Organisation and so important that it is
impossible to conceive of an Organisation at all unless some person or persons are in
a position to require action of others."

iii) Accountability
Accountability means that the subordinate should explain the factors responsible for non-
performance or lack of performance.

 Every employee/manager is accountable for the job assigned to him.

 He is supposed to complete the job as per the expectations and inform his superior
accordingly.
 Accountability is the liability created for the use of authority.
 It is the answerability for performance of the assigned duties

Definition of Accountability

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 a) According, to McFarland,
"accountability is the obligation of an individual to report formally to his superior about the
work he has done to discharge the responsibility."

Authority, Responsibility and Accountability are Inter-related

 They need proper consideration while introducing delegation of authority within an
Organisation.

In the process of delegation,

 the superior transfers his duties/responsibilities to his subordinate
 and also give necessary authority for performing the responsibilities assigned.
 At the same time, the superior is accountable for the performance of his
subordinate.

2.42 Steps involved in carrying out delegation

For achieving delegation, a manager has to work in a system and has to perform following
steps:-
 Assignment of tasks and duties
 Granting of authority
 Creating responsibility and accountability
Delegation of authority is the base of superior-subordinate relationship, it involves
following steps:-
i) Assignment of Duties
 The delegator first tries to define the task and duties to the subordinate.
 He also has to define the result expected from the subordinates.
 Clarity of duty as well as result expected has to be the first step in delegation.
ii) Granting of authority
 Subdivision of authority takes place when a superior divides and shares his authority
with the subordinate.
 The subdivision of powers is very important to get effective results.
iii) Creating Responsibility and Accountability
 The delegation process does not end once powers are granted to the subordinates.
 They at the same time have to be obligatory towards the duties assigned to them.
 Responsibility is said to be the factor or obligation of an individual to carry out his
duties in best of his ability as per the directions of superior. Responsibility is very
important.
 Therefore, it is that which gives effectiveness to authority.

2.43 Benefits of Delegation

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i) Benefits to the Manager/Supervisor
 Makes manager’s job easy and exciting
 Reduces stress
 Frees manager to do what he should be doing
 Develops trust and rapport with his employees
ii) Benefits to the employee
 Provides professional growth opportunities
 Develops their professional knowledge and skills
 Elevates their self-image and ultimately self-esteem
 Enhances their confidence and value to the organization
 Brings them personal satisfaction and a sense of achievement
 Gives them opportunities to be involved with decision making
iv) Benefits of Delegation to the Organization
 Saves money
 Promotes teamwork
 Brings about professionalism
 Increases productivity and efficiency

2.44 Symptoms of poor delegation

 Deadlines are frequently missed

 Some employees are much busier than others
 Competent employees feel frustrated and bored
 Manager is usually too busy to talk to employees
 Employees are assigned the tasks with proper training
 Employees are unsure of their authority and responsibility
 Employees’ suggestions are often neglected and overlooked
 Employees frequently request transfers to other departments
 Manager never has time to visit the employees’ work stations
 Changes in plans and objectives are not passed on to employees
 Communication flow is very slow, incomplete and often too late
 The department/organaisation is plagued by slow decision making
 Manager sometimes intervenes in the task without informing subordinates