Planning and Organizing: Importance and Process of Organizing (For CBSE, ICSE, IAS, NET, NRA 2022)

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Organizing is the next important function of management after the planning. All these tasks form part of organizing function. Thus, organizing refers to the process of:

  • Identifying and grouping the work to be performed.
  • Defining and determining responsibility and authority for each job position.
  • Establishing relationship among various job positions.
  • Determining detailed rules and regulations of working for individuals and groups in organisation.

Importance of Organizing

  • Facilitates administration as well as operation of enterprise.
  • Facilitates growth and diversification of activities through clear division of work.
  • Helps in developing a proper organisation structure.
  • By grouping work and people properly, production increases, overload of work is checked, wastage is reduced.
  • Provides for the optimum use of technical and human resources.
  • Encourages creativity and enhances interaction among different levels of management.

Process of Organizing

Image Shows the Process of Organising

Identification of Activities

  • Every enterprise is created with a specific purpose.
  • Based on this, the activities involved can be identified.
  • Essential to identify various activities of an enterprise.

Grouping of Activities

  • Once activities are identified, then they need to be grouped.
  • Activities which are similar in nature can be grouped as one and a separate department can be created.
  • All activities of a manufacturing unit can be grouped into major functions.

Assignment of Responsibilities

  • Completed the exercise of identifying, grouping and classifying all activities into specific jobs.
  • They can be assigned to individuals to take care of.

Granting Authority

  • On the basis of responsibilities given to specific individuals.
  • Necessary authority to ensure effective performance.

Establishing Relationship

  • Very important job of management as everybody in the organisation.
  • Relationships become clear and delegation is facilitated.

Difference between Formal and Informal Organisation

Formal vs Informal Organization
Formal OrganisationInformal Organisation
Created by top managementNot created by top management.
Created to get the jobs of an organisation performed in a planned and systematic manner.Formed to satisfy those needs of members which cannot be satisfied through formal organisation.
Managed by officially appointed managers.Members select someone as their leader to take care of the interests of the group members.
Managers of formal organisation have formal authority.Authority of the leader depends upon combined support of group members.
Permanent and stable.Temporary nature.

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