Organising is the management function that follows planning, focusing on structuring resources and tasks to achieve organizational goals. It involves coordinating human efforts and resources to implement plans effectively. Wipro Technologies, for instance, restructured into decentralized subsidiaries to enhance customer orientation and compete globally, illustrating the role of organising in translating plans into action.
Example: Wipro’s shift to a decentralized structure with self-sufficient subsidiaries allowed it to focus on specific product lines like telecommunications and financial services, improving efficiency.
Organising is the process of identifying and grouping work, defining and delegating responsibility and authority, and establishing relationships to enable effective collaboration toward achieving objectives. It creates a framework that clarifies roles, ensures optimal resource use, and fosters cooperation.
Definition: “Organising is the 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.” – Louis Allen
Example: In a school fete, organising involves dividing tasks into committees (e.g., food, decoration) and establishing coordination to ensure smooth execution.
Organising follows a systematic process to structure work effectively:
Example: Students organizing a library shipment divide tasks (unloading, stocking, waste disposal), assign roles, and establish a supervisor to coordinate efforts.
Organising is critical for achieving organizational goals and adapting to dynamic environments. Its benefits include:
Example: ONGC’s asset-based structure improved decision-making and resource allocation, supporting growth.
The organizational structure is the framework for performing managerial and operating tasks, defining relationships between people, work, and resources. It is shaped by the span of management (number of subordinates a manager can effectively supervise) and is essential for coordination and control as organizations grow.
Definition: “Organisation structure is an indispensable means; and the wrong structure will seriously impair business performance and even destroy it.” – Peter Drucker
Example: Sunita’s travel agency divides work into operations, sales, and administration to ensure harmonious customer-employee interactions.
Groups activities by functions (e.g., production, marketing, finance). All departments report to a coordinating head.
Organizes activities by product lines or business units, each with its own multifunctional team (e.g., production, marketing within a division).
| Basis | Functional Structure | Divisional Structure |
|---|---|---|
| Formation | Based on functions | Based on product lines |
| Specialisation | Functional | Product |
| Responsibility | Difficult to fix | Easy to fix |
| Managerial Development | Difficult | Easier |
| Cost | Economical | Costly |
| Coordination | Difficult for multi-product | Easy |
Example: A company with cosmetics and clothing divisions adopts a divisional structure for better product focus.
Designed by management to achieve goals, with defined authority, responsibility, and rules.
Emerges spontaneously from employee interactions, forming social networks based on common interests.
| Basis | Formal Organisation | Informal Organisation |
|---|---|---|
| Meaning | Authority structure by management | Social relationships from interaction |
| Origin | Company rules | Social interaction |
| Authority | Position-based | Personal qualities |
| Behavior | Rule-directed | No set pattern |
| Communication | Scalar chain | Unplanned, any direction |
| Nature | Rigid | Flexible |
| Leadership | Managers | Group-chosen leaders |
Example: ONGC’s formal asset-based structure clarified roles, while informal groups among employees facilitated quick feedback.
Delegation is the downward transfer of authority from a superior to a subordinate, enabling managers to focus on high-priority tasks while empowering employees.
Definition: “Delegation is the process a manager follows in dividing the work assigned to him so that he performs that part which only he can perform effectively.” – Louis Allen
| Basis | Authority | Responsibility | Accountability |
|---|---|---|---|
| Meaning | Right to command | Obligation to perform | Answerability for outcome |
| Delegation | Can be delegated | Not entirely delegated | Cannot be delegated |
| Origin | Formal position | Delegated authority | Responsibility |
| Flow | Downward | Upward | Upward |
Example: A production manager delegating tool requisition to a foreman ensures tasks are completed efficiently without overburdening the manager.
Decentralisation is the systematic delegation of authority to all levels of management, placing decision-making closest to the point of action.
Definition: “Decentralisation refers to systematic effort to delegate to the lowest level all authority except that which can be exercised at central points.” – Louis Allen
| Basis | Delegation | Decentralisation |
|---|---|---|
| Nature | Compulsory act | Optional policy |
| Freedom of Action | Less freedom | Greater freedom |
| Status | Process to share tasks | Policy decision |
| Scope | Narrow, between superior-subordinate | Wide, to lowest levels |
| Purpose | Reduce manager’s burden | Increase subordinate autonomy |
Example: Johnson & Johnson’s decentralized structure allows its 190 units to operate as smaller, agile firms, enhancing customer focus and growth.
Organising is the process of defining and grouping activities and establishing authority relationships. Its steps include identifying and dividing work, departmentalisation, assigning duties, and establishing reporting relationships. Organising ensures specialization, clarity, resource optimization, adaptability, effective administration, personnel development, and growth. Organizational structures can be functional (function-based) or divisional (product-based), each with distinct advantages and limitations. Formal organization is management-designed with clear roles, while informal organization arises from social interactions. Delegation transfers authority, comprising authority, responsibility, and accountability, and supports management efficiency, employee development, and coordination. Decentralisation extends delegation across all levels, fostering initiative, quick decisions, and growth, but requires balance to avoid disintegration.