Chapter 5

ORGANIZING
“Every

organization is
responsible for its
resources” P. Victor
5.1 Nature and Basic Concept of Organizing
Organizing is bringing together the human, physical
resources and coordinating them, in order to accomplish
the objectives established in the planning process.

Organization, involves developing a structure to

coordinate the efforts of different activities with
different people.

The two key concepts of Organization are;

Design & Structure
Design: managers make conscious effort to predetermine
the way in which work is done by employees.

Structure: refers to relatively stable relationships and

aspects of organization.
 Nature of Organizing
Nature of Organizing Is the Process of breaking down the
overall tasks into individual assignments and then
bringing together those assignment in to units or
department and delegate the authority to units.

This answers:
Who- Defining the
Is the boss? Authority
& &
Who are the Responsibility
subordinates
PLANNING
O
STRUCTURE
R
Of the organization
G
A
N
I
Z
PEOPLE
I In the organization
N
G
Organizing is like a bridge connecting
RESULTS the PLANNING function to the
accomplishment of reality
 Organization function
Organizing results in an organization structure that can be a
though framework which holds the various functions together
according to the pattern determined by management.

Organizational structure is formal framework that shows a set of

tasks assigned to Individuals, and departments, reporting
relationships including lines of authorities, decision
responsibility, number of hierarchal levels, and span of
management or control.
 Organizing function :
Organizing function has the following four distant
activities.
1. It determines what work activities have to be
done in order to accomplish organizational
objectives.

2. It classifies the type of work needed and

groups the work In to manageable work units.

3. It assigns the work to individuals and

delegates the appropriate authority.

4. It assigns a Hierarchy of decision-making.

 Organizational Chart
Organizational structure is simply diagrammatical presentation
of all the positions in an organization and their formal
relationship to one another.

An organization Chart shows;

 The hierarchical structure of organization
 The number of management layers
 Degrees of authority, status and compensation
 How an organization’s activities are departmentalized
 The work being done in each position
 Formal channel of communication
An organizational chart does not shows;
 The ongoing dynamic of work place behavior
 The interaction between people who have no official
reporting relationships.
 Personal preferences and coalitions and Interference by
others
5.1 The Importance of Organizing
The fundamental benefits of organizing
includes
 It promotes collaboration and negotiation among
individuals in a group.
 It sets clear-cut lines of authority and responsibility for
each group or department.
 It improves the directing and controlling function of
managers.
 It develops maximum use of time, human and material
resources.
 It enables the organization to maintain its activities and
coordinate effort of managers and employees.
 It encourages employees creativity, decision-making
and independent thinking based on well defined
policies, rules, and procedures.
 It helps to adopt new technologies.
 Importance of Organizing…
 It reduces the internal and external problems
through controlling and planning units of the
organization.

 It helps to attain organizational goals and

provides scope for diversification, innovation
and adoption.
5.2 Principle of Organizing
There are some common principle of organizing
in all organization.
These principle are
1. Line of authority
2. Unity of command
3. Responsibility and authority
4. Higher and responsibility
5. Line and staff function
6. Specialization
7. Span of control
8. Simplicity
 5.3 Major Element of Organizing
The major elements of Organizing are as follows;
 Work specialization and Span of
management
 Centralization and Decentralization
 Departmentation and Delegation

 Authority and Responsibility

1.Work specialization
Organizations perform a wide variety of tasks. A
fundamental principle to perform these tasks more
effectively is work specialization.
The concept of work specialization is traced back to Adam
Smith’s discussion of division of labor and his conclusion
which was specialization increases employees
productivity.
A) Advantage and Disadvantage of
Specialization
A) Advantage of Specialization
 Maximizing outputs of workers and machines through
breaking down a tasks into smaller elements
 Allow employees to master the task in the shortest time.
 Allow human labor to be interchangeable used.
 Training is easier with specialization and takes shorter
period.
 It can save time that is always lost in changing from one
job to another.

B) Disadvantages of Specialization
 Specialization limits the flexible use of worker from one type
of work to another.
 Worker may be over qualified for the job.
 Bored feel and fatigue of worker due single job performance.
 And create communication barriers.
 Conflicts of Rules, policies and procedures and time
2. Span of management
The concept span of control refers to the optimum number of
subordinated an executive can effectively supervise.

According to the classical school of mgt, the number of

subordinates to be controlled by any executive is from 6-8
persons.
While others recommended that the span of control to be
between 4-7 persons per manager.
A. Wide span of management
A flat organization structure is characterized by an overall
broad span of control, horizontal dispersion, and fewer
hierarchical levels. It is resulted from supervising relatively
large number of subordinates.
B. Narrow Span of Management
This is when supervisor need to involve closely with subordinates. It is
a tall organizational structure characterized by narrow span of
management and relatively large number of hierarchical levels. The
managers manages small number of immediate subordinates.
Advantages of Wide and Narrow Span of
Management
Advantages of Wide Span of Mgt
 Accelerates communication between managers and
subordinates.
 Forces managers to delegate greater responsibility and
authorities to their subordinates.
 Broadens the scope the operational managers.
 Shortens the channels of communication and reduces
the possibility of distortion and delays.
Advantages of Narrow Span of Mgt
 It makes possible close supervision.
 And there will be more effective managing of
subordinates.
 It is easy to coordinate and control activities.
 It expedites more personalized and close contact
between superiors and subordinates.
3. Centralization and Decentralization
Centralization and decentralization are commonly
used to refer to the concentration or dispersion of
employees, physical facilities, and the decision-
making power.

In some organization Top level managers make

all the decisions and the lower level managers
merely carry out the dictions made by Top
managers.

While some other organizations push down the

decision making power to the lower level
managers who are closer to the actions.
 Centralization VS Decentralization
Centralization, is the concentration of decision
making power at the Top level of the
management.

Top management makes the key decisions in the

organizations with little or input from lower
level employees.

Decentralization, is the transfer of responsibility

from the central government bodies to field
units of central government and Semi-
Autonomous private or voluntary organization.
4. Departmentation
Depart mentation, is the process of dividing the overall
operation of the organization into specialized sub-
activities and then grouping these specialized
activities and the responsibility areas into working
groups.
The aim of depart mentation is achieving unit
direction, effective communication, coordination
and control.
The Bases of Depart mentation
1.Functional Depart Mentation
2.Product Depart Mentation
3.Geographical Depart Mentation
4.Customer Depart Mentation
5.Process Depart Mentation
 Functional Depart mention
It is one of the of most The popular way to group
activities in organization.
GENERAL MANAGER

Production Finance H. Resources Marketing

Q. Control P. Manufing R&S T&D ER

Planning
 Customer Depart mentation
 Customer departmentalization is a method of
organizing work into groups based on the type of
customer they serve. It's also known as market
departmentalization.
 Benefits Helps managers understand their target
market, Improves customer service and
satisfaction, and Helps organizations adapt to
changing customer preferences.
 5. Authority and Responsibility
Authority is defined as the right to give order
and the power to exact obedience.
It is the power to make decisions, which guide the
actions of the others.
Authority is derived from the person’s official
position in organization.

Responsibility is obligation of an individuals to

carry out assigned duties to the best of his her
ability.

It is what one person exactly is expected to

perform as required duty.
 Source of Authority
There are three theories about the source of Authority.
Top down/classical view of authority

Acceptance or bottom up theory of authority

The competency theory of authority

6. Delegation
It is the process of allocating task to subordinates,
giving them adequate authority to carry out those
assignments.
Importance of Delegation
Enables managers to perform higher level work
Better decision making, as lower level managers
Improves the moral and enterprise sprit of
subordinates
 The Process of Delegation
Identify and design the task
Grant the authority to people who will perform the work
Make worker responsible for the job
Basic Principle or Guidelines of Delegation
- Authority and Responsibility should be equivalent
- Avoid dual subordinates or maintain unity of command
- The exception principle must be followed
Note, Abdicate
 Review question
Discuss each of the following

1. AUTHORITY
2. POWER
3. ACCOUNTABILITY
4. RESPONSIBILITY