Various managerial functions will be effectively performed with the help of an organisation. It is in this sense it is claimed that there is no substitute for good organisation. In any industry, trust plays a pivotal role in determining whether a business … Ensure growth – A well-defined organisation structure will help an enterprise to grow and expand its operations. Unsound organisation becomes the breeding ground of dishonesty, whether in matters of effort or of money. 8. It is indeed the foundation of management”. Management, Functions, Organisational Structure. Management creates and forms various groups of closely- related and similar activities; which is necessary for the functioning of the enterprise. You can't expect to overturn years of bad organizational habits in a day. It facilitates proper... 3. A flexible organisational structure will enable the employment of more persons without disturbing the working. Poor organisation may mean improper arrangement of facilities and failure to achieve goals. A well-structured organisation also encourages co-ordination and co-operations amongst all the individuals in the organisation. Controlling as a function of management is of great value and importance in a business organization to ensure that the actual state of affairs of a business is along the lines of … Effective business writing drives sales. When items are organized, finding them is easier, and the time is takes to organize a home or office will save time that … Organisation has efficient methods of selection, training, remuneration and promotion of employees. A sound organisation by providing for training of staff at different levels and by proper delegation and decentralization helps development of managers. Permits Optimum Use of Resources 7. Organisation is a mechanism which consists of formal organizational structure of role, relationship, position and authority. With the passage of time, however, even a good organisation may be transformed into a bad one unless continual adjustments are made with the varying circumstances. All these factors assure stability. Good organisation removes red-tapism and corruption, prevents duplications of work, makes communication easier, and provides a sound basis for workers participation in the management. Organising makes possible the effective operations of a group. Division of work and specialisation are the tools used to achieve the objective of optimum utilisation of material, resources and human efforts. That is why, it is generally said that organisation is the machinery of management in its achievement of the ends determined by administration. job rotation, job enlarge­ment, delegation, etc. vi. It facilitates growth and diversification and stimulates creativity and innovation. All these ensure an optimum use of human resources of an enterprise. Better Human Relations and a Few Others. Culture has the ability and capability of training, attracting and changing people. 18. With these activities the organisation provides a framework within which the company grows. Julie Bestry, certified professional organizer and president of Best Results Organizing, says from her experience, people often make the mistake of thinking about organization in terms of how things look. Money and efforts are spent in proportion to the contribution made by each and every department. Organisation structure establishes hierarchy in the organisation; which clearly make an outline of the information flow. It also provides for efficient methods of selection, training and promotion of employees, further not as machines. It disposes of conflict between individuals; individuals and the enterprises, enterprise and the economy as a whole. It gives smooth management and administration. Sound organisation helps in coordinating various jobs in the department or organisation. This ensures that each person and department will contribute to his best capacity and skill, will feel definite and specific responsibility, will avoid duplications and overlaps and will improve the efficiency and speed of work. Aid to Management 9. There will be a need for employing more persons whenever expansion and diversification takes place. The new entrants get sufficient training in their work. In short, a properly conceived organisation structure facilitates effective communication, precise delegation, smooth management, proper co-ordination and control, closer co-operation, effective leadership, higher employee morale, managerial efficiency, steady growth and diversification, optimum use of human and other resources, optimum use of technological improvements development of managers, creativity among the staff and accomplishment of enterprises objectives. It enables smooth management and operation of the enterprise, thereby enhancing managerial efficiency, e.g. Organisational structure lays down both channels and the patterns of communication. Area and activities of a business grow if it has a well-knit organisation. It Ensures an Optimum Use of Human Resources: Sound organisation matches the jobs with the individuals and vice-versa. An important function of planning will be effective only if there is an organisation to implement it. viii. Additional activities will not put any strain on the management. 9. Complete Insureon's online application and contact one of our licensed insurance professionals to obtain advice for your specific business insurance needs. Proper organisation provides .satisfaction and various incentives to employees. It provides for the optimum use of technological improvement, e.g., automation and computerisation. Organisation is the mechanism which determines the relationship of various persons. Image Guidelines 4. Why Understanding Organizational Behavior Matters. As a result, unimportant and trivial issues are given top priority. Development of manpower – A sound organisation aims at continuous improving its human resources. It permits management to respond in time to the changes in the environmental influences and make necessary adjustments to satisfy new demands of the society. If persons are not encouraged to take new initiative then the management may not be able to cope with the changing business environment. 6. Instead of a single chief executive in a large company, Peter Drucker would prefer a team with a captain who is more than one among equals and each member of the top management team has assigned areas in which he makes formal decisions and for which he is res­ponsible. Any business big or small anticipates a large sum of cash flowing in and out of the company. ix. Sound organisation has flexibility and also stability. Organisation structure provides the formal channel of communication which is necessary for smooth functioning of the organisation. It is the basis for necessary team work among the various members of a common enterprise and helps in coordinating their efforts. Similarly, extensive use of staff specialists and creation of a good management information system together with elec­tronic data processing (EDP) equipment will help manage effectively a multi-national company. Uploader Agreement. Clear-cut accountability provides re­cognition for the specialist and the professional in terms of their achievement. When management is leading an organization in an ethical manner, employees follow in those footsteps. An organisation works in a dynamic environment and to cope with the changing business situation better technology is always helpful. Sound organisation uses the material resources by taking into consideration the various constraints. Headings with relevant keywords can also help Google recognize critical topics in longer posts, which is better for SEO. Following are some of the important advantages of a sound organizational design which have enhanced its importance and have, therefore, made it indispensable: The function of organizing is required for the performance of other functions of management like planning, staffing, directing and controlling. As Lounsburry Fish points out-“Organisation is more than a chart, it is the mechanism through which management directly co-ordinates and controls the business. "Studies from the Journal of Experimental Psychology report multitasking wastes time and leads to distraction, errors, and memory lapses," Bestry says. It gives smooth management and administration. Best plans may fail if these are not executed properly. A sound organisational structure will give an opportunity for the staff to show their hidden talents which will help the enterprise to achieve the business goals and earn higher profits. It gives proper recognition to the contribution of each individual, values their co-operation hence gaining their sincerity and loyalty. The “bottom line” is at the heart of every business. iv. Whether you’re running your own business, or just starting out on your business career, you’ll need to be a great communicator! It offer ample scope for the training and development of managers e.g. It will help you recognize what you actually need in front of you and force you to put away things that don't need to be immediately handled. It promotes effective leadership and thereby ensures good em­ployee morale. Following are the advantages of a sound organisation structure: 1. The training may be given within the company or outside the company according to the training facilitates available. 2. 11. There will be a need of proper authority to carry out the functions systematically and effectively. Organizing your business's workspace may not be high on the priority list, but it should be. It is the backbone of a management and without it; no management can manage the various operations of an enterprise. The adjustment to new changes will require re-scheduling and re-adjustment of duties and responsibilities in the organisation. We may have top manage­ment in the hands of a few chief executives forming a top level executive committee running the affairs of very big enter­prise. A reader is more likely to stick around when a quick scan reveals that the information in your article is relevant. It Provides for the Optimum Use of Technological Innovations: A sound and ideal organizational structure is not rigid but it is flexible to give adequate scope for the improvements in technology. 3. In short, sound organisation provides following typical results: ii. Why Company Culture is So Important to Business Success. This will bring an automatic co-ordination in the business. Organization is important for dealing with information as well. It is more than a chart-it is the best mechanism for managerial leadership, co-ordination and control. Once you find the right policy for your small business, you can begin coverage in less than 24 hours. If you do not feel confident about what you are doing, two things will happen. It is more than a mere chart—it is the best mecha­nism for management in action, i.e., leadership, motivation, coordination and control. Organisation is also essential for the continuity and stability of the enterprise. For instance, maybe your strewn business cards are a result of not having a system to catalog new contacts. Technological Innovations and Improvements: A sound organization structure which is adaptable to changes can make the best possible use of latest technological innovation and improvements. It creates clear cut relationship between the departments and helps in laying down balanced emphasis on various activities. 2. Opportunities are seized quickly and exploited fully, ultimately, paving the way for growth and diversification. 17. Efficient organisation offers the following benefits: 1. In the business world, organization might be said to be everything. By providing training and practice on different jobs, and in different capacities, efficient organisation offers excellent scope to its employees for development. It gives them job satisfaction too. If businesses fail to keep up with these constantly-moving targets, they lag behind, become stale and, ultimately, fail. Plagiarism Prevention 5. The structure of the company can be changed whenever the growth and expansion activities are carried out. Here are just a few of the many things that are important to consider when thinking about the structure of your organization adapted from Factors Affecting Organizational Design...Strategy, Size, Organizaition … All these factors assure stability. Changes in the organisation may result in the appointment of additional staff members, de-centralisation of authority and responsibility, raising of additional capital, identification of the consumer’s satisfaction and preferences, expansion of sales promotion activities and the like. Besides, the administration classifies the activities of the business department-wise and appoints the officers, assistants, supervisors, executives to facilitate the achievement of objectives. 8. Organisation is, however, more than a chart. With the help of a well-defined organisation management is able to perform the functions of direction, co-ordination and control. A disorganised inventory system is one of the quickest ways … Confusion and misunderstanding over who is to perform what work is avoided by specifying the role of managers clearly. Getting organized can help: But don't just take our word for it. viii. Everybody will know his limitations and may try to remain in that sphere. Prohibited Content 3. It comprises people and it is the agency through which management performs the important functions of direction, co-ordination and control. If you look at your office and see chaos, that disarray is probably keeping you from being productive. It helps in optimum use of equipment, machinery etc. The functions like co-ordination and control require a proper division of various functions and their assignment to suitable persons. Good organizational skills naturally feed productivity, enabling small business owners to cross off more items from their to-do lists. The bottom line is a company’s net income after all expenses have been paid out of its earnings. Co-operation – A sound organisation ensures proper co­operation amongst its employees. Time for a dose of reality: change in business is absolutely vital if organisations are to realise growth potential, propel teams onto greater things and launch products and services which were once but a pipe dream. Therefore, the importance of organizational leadership cannot be … Bestry suggests grouping similar tasks together. Organizational charts are used all around the globe by many companies or organizations. It is not simple organising function of management, it is more than that. Thus routine duties can be transferred to subordinates so that superior line officers can concentrate on policy formation and forward planning. It responds in time to the changes in the environment and thereby justifies its existence. This is done by dividing the activities in such a way that they become complimentary to each other.”. It enables smooth management and operation of the enterprise, thereby, enhancing managerial efficiency, e.g. It is the backbone of a management and without it; no management can manage the various operations of an enterprise. If an organisation is ill-designed and reveals a number of deficiencies, management is rendered difficult and ineffective. A clearly defined work, authority, responsibility, accountability will enable individuals to work in a free atmosphere. Put items in an accessible place as part of getting organized. with the help of clear-cut accountability, recognition, appreciation of talents etc. To sum up, it is the enterprise. xii. Take a moment to evaluate what it's costing you to be disorganized. Content Filtration 6. Running a small or even big business is not an easy job. It lays solid ground-work for focusing the attention and action of management on the accomplishment of the objectives of enterprises. Activities that should be integrated or centralized are spread out and put to improper supervision. Effective organisation enables growth and diversification through decentralisation and divisionalisa­tion on geographical or product basis. 4. (5) It Encourages Human Use of Human Resources: A sound organisation provides for job rotation and job enlargement and makes job meaningful and interesting. As more and more businesses are looking for ways to grow and remain competitive in the market, there is an increase in need of technical skills and … 3. Avoids confusion and misunderstanding – By assigning definite duties and responsibilities, establishing definite superior-subordinate relationships, clear cut delegation of authority and by proper selection and training of the Staff, organisation brings definiteness and knits all its segments to operate together to realise its goals, Each of its departments or employees knows his specific mission, duty, authority and responsibility. If you're serious about changing the status quo for your business, Norris suggests using detective work to resolve the roots of a messy business. Bestry agrees that keeping too much of anything in your workspace is a bad plan. The top level executives perform the functions, like planning, organising, staffing, directing, controlling the lower level people. Another critical and versatile advantage of finance is developing long … with the help of clear-cut accountability, recognition, ap­preciation of talents, etc. Sound organisation offers effective management of changes continuously and gives premium to innovations. Human relations improve in a good organisational set up. A manager leads, co-ordinates and controls the enterprise activities through the organisation. It prepares them to take more responsibilities whenever need arises. The information systems section is answerable for sustaining the software, hardware, data storage, and networks that encompass the business’s IT arrangement. It lays the basis for other managerial functions such as planning, direction, co-ordination and control. The activities of different departments are grouped together to achieve the business objectives. Techniques of organizational strategy are designed to avoid this situation, and to keep organizations moving efficiently toward their goals. This will give job satisfaction to employees. It promotes effective leadership and thereby ensures good employee morale. Sound organisation helps in keeping the various activities under control and increase the capacity of the enterprise to undertake more activities. Terms of Service 7. v. It is more than a chart—it is the best mechanism for mana­gerial leadership, co-ordination and control. But once the business starts to grow and separate departments are created for buying, selling, accounting, administration and so on, the need for organisation undoubtedly grows with it. Sound organisation encourages human use of human re­sources. It allows most people to maintain a positive attitude towards self, others, works and life in general. In an environment in which an organisation is dynamic and constantly changing to cope with ever changing situations, it is very important to encourage the employees to take proper initiative. Allen observes that “A properly designed and balanced organisation facilitates both management and operation of the enterprise. More important, it is a major part of your ongoing business operations. Confusion, delay and duplication of work are avoided in good organisation. Proportionate and balanced emphasis is put on various activities. In this sense, it is the foundation of management as well as its chief tool. But within these limits people are given freedom to show their talent. Remember, keeping your office organized is a form of risk management. That perspective will help you make organization part of your business life. All content and materials are for general informational purposes only. Incom­petent individuals are overused while talented people are under-utilized. Good organizational structure and design helps improve communication, increase productivity, and inspire innovation. The growth of business means an increase in the scale of operation and diversification means starting of production of a new type of products. 3. Professional organizers Julie Bestry and Vicki Norris explain why organization is such an important part of running a successful business. We asked two professional organizers why organization is so important for small businesses and how they can stay organized for the long haul. Executive Development 11. Jobs are designed to suit human needs. 7. 15. It encourages creativity, i.e. A neat space and functional sorting systems ensure you don't lose track of important documents and bills. A business organization needs a strong financial team to handle the cash flow of the company, with existing records as a testament to the different transactions. It Provides Ample Scope for Training and Development: An effective organisation facilitates delegation of authority which is an important device for training and developing the personnel. All these factors assure stability to the enterprises. Efficient organisation, thus, avoids all misunderstanding, confusions, conflicts, duplications and gaps. Innovate Why Change Is Essential to Your Organization (And How to Embrace It) Think back to your business's "why" to discover some areas to bring forth positive change. It is the key to managerial success. A good organisation clearly defines the scope of work of every person and allows them to grow in that sphere. The actual work is completed at lower level of the organisation. If the business owner is keeping a complete track of the sales, then they will also get an idea about how long it takes for them to reach break even or additional profit levels. If the new technology is adopted by the enterprise, the maximum benefits can be obtained in any field or activity. Sound organisation structure stimulates creative thinking and initiative amongst organisational members by providing well defined patterns of authority. Anything you use at least every day should be within easy reach. The following are the importance of organisational structure: 1. The answer to this question may seem obvious: because it addresses and fixes a problem, thereby increasing a business's effectiveness. Facilitates Training and Development of Managerial Personnel: 10. Division of work enables an individual to specialize in the job in which he is proficient leading to better utilization of resources and talents. Delegation of authority is also an important means of directing the sub-ordinates. Important of finance for business organizations. job rotation, job enlargement, delegation etc. It enhances the productivity through avoidance of duplication of activities and the consequential confusion as well as wastage of efforts. Ensures Co-Operation among Workers 12. It ensures close co-operation and higher employee morale. A well devised organisational system will provide a sufficient opportunity for the training of new trainees and development of existing staff. That is, if there is no organization there is nothing but chaos - which can’t be managed. An organisation is concerned with activities such as recruitment of staff, delegation of authority, assignment of responsibility co-ordination and control of activities at different work centres, etc. Thus, it facilitates human use of human beings. Obvious organization will make your post more skimmable, and that’s a good thing! It cannot be seen. 14. It ensures, above all, accomplishment of objectives and strategies. Poor organisation leads to improper arrangement of duties and responsibilities. If you're serious about changing the status quo for your business, Norris suggests using detective work to resolve the roots of a messy business. Organizing is a process of arranging things and keeping them into order. Such systematic structures lead to better coordination among the teams and departments therefore helping in the overall development of organization and its goals. Use of better technology – A growth oriented organisation encourages the use of better technology. Inspiring Morale. It is the basis for necessary team work among the various members of a common enterprise and helps in coordinating their efforts. A lot of new businesses are carried away and figure their passion and optimism are enough to build […] It is, indeed, the foundation of management. It specifies the channel and mode of communication among different members. In this way, the organisation maintains the relationship with each other in an enterprise. Departmentation enables proper planning of work. In the scientific world, there is a lot of innovations and inventions identified in the area of production, distribution and personnel management. Why Is Inventory Important for a Business?. In other words, the value of each individual’s contribution is enhanced and at the same time the accomplishments of the group are increased. Why is organization important? These would create utter confusion, chaos and conflict. This helps to check out that all necessary expenses are met, including taxations t… 20. It ensures steady growth and diversification. "You think you're doing double-duty, but your brain is actually jumping back and forth and doing each thing less efficiently and less effectively.". Brings unity in direction, facilitates control and co-ordination – Efficient delegation and effective communication system, and well knitted relationships bring unity in command and direction, fixed responsibilities and division of work and facilitate control and co-ordination. There may also be a need to delegate new powers for making best utilisation of technological changes. In turn, you are better able to serve your clients and cut down on work mistakes that can lead to lawsuits. Save money by comparing insurance quotes from multiple carriers, Organization 101: Why organizing your business matters. Clear au­thority relationships and proper assignment of work facilitate the task of achieving coordination at all levels. Loose contact files and business cards are missed leads and lost revenue if information isn't managed and queued. When more activities are added to an enterprise then only a sound organisation structure will be able to maintain the smooth running of the enterprise. Under good organisation, there is a chance of exhausting the worker’s ability in full and utilisation of resources effectively. Constitute insurance advice of problems, particularly legal issues total work can not be able cope. Collective office of the organization in a closely related manner and not like robots or ma­chines etc... Try new ideas for improving upon their work. business situation better technology is always helpful each... 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