Organizing

1. Important of Organizing
Organizing is generally followed after the planning stage and is considered an important
function of management. Management involves synchronizing and using the physical, human
and fiscal resources effectively in order to succeed in an organization. Hence, in order for a
concern to function properly, it is important that the organization functions well too. The
organizational functions are performed well by a manager by the following methods:

Specialization: The work of an organization is separated into units and departments through
an organizational network of associations. This helps in getting specialization in different areas
of work in an organization.

Well-defined jobs: Organizational structure aids in getting the right people to do the job by
choosing people in accordance with their skills, knowledge and qualifications for working in
different departments of the organization. This aids in properly defining the work of an
organization which further aids in explaining the responsibilities of each person.

Clarifies authority: Organizational structure aids in helping the manager to understand each
persons role. This can be achieved in the manager being able to understand clearly how he has
to use his powers. This aids in an increase in production as jobs and responsibilities that are
well defined make the managers jobs much more efficient.

Co-ordination: Organization is a process of establishing co-ordination amongst various

departments and it also aids in defining relations amongst various positions and individuals
assisting each other. If the managers at a higher level implement their power over the network
of activities of managers at lower levels, it can bring about efficiency in work.

Effective administration: The organizational structure aids in clarifying the positions of the
jobs. The roles and responsibilities of different managers are well-defined and by dividing the
work it is easy to achieve specialization. This further aids in an organization that is well-
organized and efficient.

Growth and diversification: A companys development depends largely on its smooth

functioning and efficiency. This can be achieved by defining clearly the roles to all the
managers, achieving co-ordination between power and duties and focusing on specialization.
Additionally, a company can expand if its capability increases and this is possible only through
a well-defined organization and a formal pattern.
Sense of security: Organizational structure defines the positions of the job and the managers
roles. Only then, it is possible to achieve co-ordination. Hence, well-defined powers aid in
inevitably augmenting mental fulfillment and a concerns safety and this factor is very vital for
fulfillment of any job.

Scope for new changes: A manger can flourish his experience and knowledge only when the
persons roles and responsibilities are well-defined and he becomes independent. A manger
can decide independently and this can effectively lead to adapting new methods of production.
New changes in the working of an organization can be brought about only through a pattern of
its structure.

2. Factor that influence organizational structure

Organizational structure is the framework companies use to outline their authority and
communication processes. The framework usually includes policies, rules and responsibilities
for each individual in the organization. Several factors affect the organizational structure of a
company. These factors can be internal or external. Small business owners must be responsible
for creating their companies organizational structure framework. Business owners may use a
management consultant or review information from the Small Business Administration before
setting up their organizational structure.
Size
Size is many times the driving factor for a company organizational structure. Smaller or home-
based businesses do not usually have a vast structure because the business owner is usually
responsible for all tasks. Larger business organizations usually require a more intense
framework for their organizational structure. Companies with more employees usually require
more managers for supervising these individuals. Highly specialized business operations can
also require a more formal organizational structure.

Life Cycle
The company life cycle also plays an important part in the development of an organizational
structure. Business owners attempting to grow and expand their company operations usually
develop an organizational structure to outline their company business mission and goals.
Businesses reaching peak performance usually become more mechanical in their organizational
structure. This occurs as the chain of command increases from the business owner down to
frontline employees. Mature companies usually focus on developing an organizational
structure to improve efficiency and profitability. These improvements may be the result of
more competitors entering the economic marketplace.
Strategy
Business strategies can also be a factor in a company organizational structure development.
High-growth companies usually have smaller organizational structures so they can react to
changes in the business environment quicker than other companies. Business owners may also
be reluctant to give up managerial control in business operations. Small businesses still looking
to define their business strategy often delay creating an organizational structure. Business
owners are usually more interested in setting business strategies rather than developing and
implementing an internal business structure.

Business Environment
The external business environment can also play an important part in a company organizational
structure. Dynamic environments with constantly changing consumer desires or behavior is
often more turbulent than stable environments. Companies attempting to meet consumer
demand can struggle when creating an organizational structure in a dynamic environment.
More time and capital can also be spent in dynamic environments attending to create and
organizational structure. This additional capital is usually a negative expense for many small
businesses.