CONCEPT OF ORGANIZING

Organizing exists long before we expect its origin. Scientists say that everything in our universe is well
organized to the point that there must be someone behind the magnificence of its structure and existence. It is
clear that a perfect organizing of anything can create a masterpiece. Just like the Creator of our universe did.

Well-organized execution of a plan leads to efficiency and results to the intended output on or before the target
time. This is the reason why we need to understand better what is ORGANIZING.

Organizing is the process of building relationships among functions, materials, and people for a common
purpose.

Organizing is a logical extension of planning activities. The available resources should be efficiently organized
to determine the insufficiencies and tasks required as early as in the planning stage to create more effective plan
to achieve a certain objective.

Person-in-charge or with authority should conduct the organizing process. It may also be done by those who
have the responsibility over a thing/group. Sometimes, those who are knowledgeable of the topic is delegated
on the task of organizing.

Allocated resources are properly disseminated without compromising its relevance and timeliness.

Organizing requires establishment of structures, hierarchies, lines of authority, and relationships. it also
involves logical division of labor and coordination.

Three dimensions of organizing

1. The form of the organization that describes the management hierarchy and formal channels of
communication
2. Task definition and structuring of jobs
3. A philosophy of organization that influences how coordination is achieved.

WHY ORGANIZING IMPORTANT

Organizing involves members’ combination of efforts to collectively accomplish tasks that would far exceed the
simple sum of their efforts. This integration of specialized tasks is called synergy.

Synergy is achieved through effective organizing.

Effective organizing of both human and material resources ultimately increases productivity.

TWIN CONCEPT OF SOUND ORGANIZING

1. Efficiency – doing things right with minimum use of resources. It is improved by using the most
productive combinations of material and human resources. It emphasizes form and processes
 A manager does things right. He is in charge of efficiency. Organizing is usually the function associated
with the manager, which involve the following:
a. Analyse the activities , decisions and relations needed;
b. Classifies the work, divides the activities into manageable jobs;
c. Groups these units and jobs into an organizational structure and
d. Selects people to manage those units and jobs to be done.
2. Effectiveness – doing the right things. It stresses the substance of the outcome. A leader is one who does
the right things.

FIVE STEPS OF THE ORGANIZING PROCESS

1. Identify tasks. Describe what people must do to reach objectives. It avoids doing the wrong thing;
accepting impossible tasks because of misdirected “can do” attitude; and accepting inappropriate tasks
because of inability to say “No”
2. Establish Structure. Use formal organizational documents to align tasks with functions, resources, and
people. (organizational charts, position descriptions)
3. Fit people to tasks. Assign the right person to the right task.
4. Establish relationships. People are the key to the success in organizing. Use these three tools to ensure
cooperation:
a. Authority - empower people to do their job
b. Responsibility - ensure they know what’s expected of them
c. Accountability - hold them responsible for results
5. Allocate resources. Direct most resources to major efforts and apply minimum resources to secondary
efforts. Give people enough resources to help people work at their full capacity.

FUNCTION OF ORGANIZING
1. Clarifies who is to perform which and how those jobs should be divided
2. Clarifies lines of authority, specifying who reports to whom
3. Creates the mechanism for coordinating across the different groups and level of the organization.

DEFINING DELEGATION
Duties and responsibilities across the workforce can become less well defined as organization grows
increasingly complex. Sometimes, one is doing someone else’s job. This may expose the organization to
different risks. Delegation is the manager’s key to efficiency, and benefits all.

Delegation involves entrusting another person with a task for which the delegator remains ultimately
responsible. An effective manager must monitor a delegated project, assuming responsibility while allowing the
delegate autonomy.

The delegator should:

1. Know how much authority is the delegate able to exercise without referring back to the delegator.
2. Assess the exercise of direct influence over the work of the delegate.
 3. Select the fully capable individual for the task and adequate resources needed in the performance of the
job.
4. Require regular progress report from the delegate

DIVISION OF WORK
It is defined as the extent to which the work of the organization is separated into different jobs to be done by
different people. Tasks are designed and performance expectations are clarified. Organizations divide their
labor into specialized tasks to improve productivity.

Adam Smith was the first to coin the term division of labor in THE WEALTH OF NATIONS in 1776.

Advantages and disadvantages of Division of Labor

Advantages Disadvantages
Efficient Use of Labor Routine, Repetitive Jobs
Reduced Training Costs Reduced Job Satisfaction
Increased Standardization and uniformity of Decreased worker Involvement and
output commitment
Increased Expertise due to repetition of work May not be compatible with computerized
manufacturing technology

SPECIALIZATION
Is the planned division of work into individual tasks that can be repeated efficiently. It is the result of the
improved productivity. Tasks are broken down into it most common elements and as employees repeat a task,
they become better at it. This is where standardization achieves.

Standardization means uniform work with predictable results. Managers must match employees to task
according to their abilities for it enhances utilization and increases efficiency. By becoming expert and then
coordinating results with other experts, employees achieve excellence and productivity.

Alienation, a potential problem of specialization.

Line and Staff work

Line works are those directly involved with a company’s primary activities
Staff works hold supporting roles. Advice and support line management activities.

GUIDELINES FOR DEPARTMENTALIZATION

Departmentalization is the horizontal grouping of activities. This grouping is normally accomplished through a
functional pattern of organization in which personnel with similar technical skills and capabilities are gathered
in separate departments. Departmentalization by product, geographic territory, customer can emerge as
companies grow.

Five Possible Ways to Departmentalize Tasks:

1. Derived from internal operations of the organization:
 a. By business function
b. By process
2. Based on external factors:
a. By product or service
b. By customers
c. By geography

Guidelines for departmentalization

1. Ensure job descriptions and performance relate to specific tasks required to achieved objectives
2. Structure tasks to capitalize on people’s talents, motivation, and capacity for growth
3. Write job description in terms broad enough so people can cross-train, serve as a team leaders, and
accept responsibility without doing work that requires job reclassification.
4. Never let a situation where an employee denies responsibility for a task because “it is not my job
description”
5. Consider advantages of assigning collective task to people who work well together.

FORMAL ORGANIZATION AND STANDARDIZATION

Work can be standardized by redefining the flow of operations. Technology often dictates workflow.
Standardization may also result from management policies and legal mandates.

BUREAUCRATIC AND ORGANIC STRUCTURES

Formalized organizations, particularly in the public sector, tend to be labelled bureaucracies. A Bureaucracy’s
form of organization is one in which activities are rationally defined, division of work is unambiguous, and
managerial authority is explicitly vested in organizations, and it implies a less rigorous division of labor in a
less formal environment.

These are centralized organizations where Job descriptions are uniform and formal rules and regulations guide
decision making. Costs are minimized but fit best with relatively stable or slow changing environment.

WEBER’S IDEAL BUREAUCRACY

ORGANIC STRUCTURES (Warren Bennis)
The organic organization structure is said to be flat. The goal is to create decentralized management roles.
Employees are encouraged to work together. It is informal, flexible, favours verbal communication and finds
change easier.

DESIGNING THE ORGANIZATION: CONTINGENCY THEORY AND ORGANIATIONAL

STRUCTURES
Contingency theory implies that organization must be capable of adapting to situations under various
circumstances

Basic concerns

1. Organizations age and size

2. Its technology and that of the industry
3. Environment forces that influence decision

JOAN WOODWARDS’S THREE CATEGORIES OF TECHNOLOGY

1. Unit Production
This is for customized services offered. Units for small batches or production are emphasized. Owner-
manager usually has hands on style of decision making. Flatter organization with few hierarchy levels
exists.
2. Mass production technology
It is characterized by formalized work. Specialization is the rule, and there is a rigid separation of
formalized work. Job specialization reduces work to simple. A tighter span of control by ore managers
over fewer workers is necessary to moderate conflicts and these results in taller organizations with many
layers of management

3. Process production
It relies on continuous conversion of materials through automatic systems and uses fewer high skilled
individuals to control more sophisticated technology. The process hierarchy therefore has fewer
managers with fewer responsibilities

FORMS OF STRUCTURING TO RE-DESIGN ORGANIZATIONS

1. Merger – when two companies or corporation by mutual agreement
2. Acquisition – it is the purchase of all or part of one business by another
3. Takeover- purchasing firm meets resistance from the target company’s stockholders.
4. Leverage buyouts or LBO – occurs when a group, often led by company management, borrows money
to buy a majority of stock in their own company.
NEW ORGANIZATIONAL FORMS EVOLVING DUE TO THE STRATEGIC REQUIREMENTS
1. Skunkworks – many firms seeking to become more entrepreneurial to generate innovative products
through independent operating units. They are formally called “new venture units” aim to give
autonomy to small groups of employees so that they can pursue new ideas for products and services.
2. Matrix Organization – temporary formation of teams of projects using personnel drawn from existing
departments.
3. Network Organizations – they are flexible, often temporary arrangements between companies, their
customers, suppliers and competitors in which firm concentrates on distinctive competence.
4. Strategic Alliances – They are formal relationships created for the joint pursuit of mutual goals, such as
when individual organization shared resources and accept joint ownership of the knowledge generated
by high-technology research.
5. The Cluster Organization – non-traditional structure in which teams are accountable for business results
and have a client orientation.
6. The High-involvement Organization – flat, decentralized structure in which even lower-level employees
have direct relationships with customers and suppliers.

STRUCTURES WITHIN ORGANIZATIONS

1. Formal Structures – structures with established rules, procedures, and channels of communication, clear
lines of decision-making authority, and well-defined jobs.
2. Informal Structures – shadow organizations that evolve through personal interaction, sentiments, and
social activities of individuals working in proximity.

EVOLUTION OF ORGANIZATION
Larry E. Greiner has identifies a growth model with five phases corresponding to a range of
development from organization inception to maturity.

1. Creative stage – often headed by one person who “is” the company. VMGO are in his/her head.
Management is informal. No delegation of authority.
2. Direction Stage – centralized management develops a “functional” structure of responsibilities. Top
management still controls the firm, but functional specialists are added in each department.
3. Delegation Stage – managers must find ways to diffuse authority as the company diversifies into new
products and markets.
4. Collaboration Stage – the fourth stage, suggests a transition away from bureaucratic paralysis toward
more flexible and adaptive forms of organization.
5. Coordination – a firm in this phase is usually operating in a mature market growth has slowed,
competitors are established, and technology is relatively stable.
6. I.T Stage – there may be a fifth stage, characterized by instantaneous communication and reorganization
tempered by global linkage and need for managers to make and diffuse decisions without intermediaries.

STAFFING
It is the recruiting, selecting, and placing the right person to the right job. It is the flow of employees into,
through and out of the organization
Training and development activities are essential for organizations desiring an effective work force.

Performance appraisal is the assessment of the employees’ job performance

Compensation involves decision regarding pay level, pay structure and individual pay distinction

Job evaluation is an important process for determining pay structure within the company

Incentive systems can be linked to the performance appraisal process at the individual, group, organizational
level.

Labor relations deal with unionization and management of collective bargaining agreements employees join
unions because’ of dissatisfaction with management practices