237 - 245 ORGANIZING AS THE PHASE OF MANAGEMENT PROCESS AND MANAGEMENT ACCOUNTING UDC 657.05+658.310.13 Ljilja Antić, Vesna Sekulić Faculty of Economics Niš, University of Niš, 18000 Niš, Serbia and Montenegro It further creates hierarchy in the management. 4. Grouping of activities into departments is called departmentalisation. Further, establishing reporting relationships facilitates coordination at all levels of management. By grouping of activities, the efforts within each department can be coordinated in an effective manner. ii. It reduces fractions among functional areas. The act of organising involves integrating, balancing and coordinating the activities of people working together for seeking common goals. 2, No 3, 2005, pp. James Stoner says, “Coordinating mechanisms enable members of the organisation to keep sight of the organisations goals and reduce inefficiency and harmful conflicts.”. To illustrate Materials Management Department may function alongside the Purchase Department to allow better coordination and reduce the ‘lead time’. The performance of departments and sections are to be compounded to achieve objectives. Each unit of total work is called a job. The Decision‐Making Process; Organizational Planning Detailing Types of Plans; Identifying Barriers to Planning; Defining Planning; Recognizing the Advantages of Planning; Using Plans to Achieve Goals; Creating Organizational Structure Concepts of Organizing; The Informal Organization; Going from Planning to Organizing; The Organizational Process North zone, South zone, West zone, East zone. A strong organisation culture means rules and regulations can be substituted by organisation culture. The steps are: 1. Necessary inputs such as men, machines, materials, equipments and other physical means must be collected and arranged for. Such an activity needs special attention. Hence, organisation must provide a mechanism for coordinating the efforts of employees so that they can work together in team spirit. Establishment of Structural Relationship for Overall Control: Process of Organising – Determination of Objectives, Enumeration of Activities, Grouping Activities, Allocation of Fixed Responsibility, Delegation of Authority and Coordination, Process of Organising – Steps: Identification and Division of Work, Departmentalisation, Alignment of Duties and Establishing Reporting Relationships, – Division of Work, Departmentalisation, Assigning Duties, Delegation of Authority and Coordinating Activities, – 3 Major Steps: Division of Work, Formation of Departments and Reporting, Process of Organising – Identification and Division of Work, Grouping of Activities, Assignment of Duties and Delegation of Authority, Process of Organising – Determination of Objectives, Division of Activities, Grouping of Activities, Defining Authority and Responsibility, Reviewing and Reorganising, Process of Organising – Division of Work, Departmentalisation, Assigning Duties, Delegation of Authority and Coordinating Activities, Process of Organising – 3 Major Steps: Division of Work, Formation of Departments and Reporting. The boundary less organisation doesn’t bother of job specialisation, chain of command or span of management and replaces departments with empowered teams. The process of organising consists of the following steps: Organisation exists to achieve certain objectives. The management has to identify all the different activities required to be done in order to achieve organisational objectives. Determining total workload of the organisation is the first step in the process of organising. Every individual is given the authority necessary to perform the assigned activity effectively. To follow cost- leadership strategy the structure has to be stable and cost efficient. It also arrests the wastage of resources, prevents duplication or overlapping of efforts and aids smooth working of the company. Consideration of Plans and Goals 2. authority) to perform those tasks. 2. Its importance lies in serving the following purposes: 1. Organizing involves a series of steps that need to be taken in order to achieve the desired goal. Government of India’s organisation structure is an example of mechanistic or bureaucratic design, whereas some of the private sector firms like NUT, HDFC Bank, or ICICI Bank are examples of organic organisation structure. 6. It helps in boosting an employee’s morale and he feels comfortable in the work- setting. are brought together and co-coordinated towards the common objectives of the organisation. However, accountability arises along with the delegation of authority. Stronger the culture, the structure can be predictable, orderly and consistent with no written documentation. Organisational structure also provides a useful means to cope with changing environment. Since one person cannot manage all the organisational activities, total task is divided into smaller units and assigned to members. Organizing essentially implies a process which coordinates human efforts, assembles resources and integrates both into a unified whole to … For instance, the total work of a manufacturing concern may be – (i) purchase of raw material, (ii) purchase of spare parts, (iii) marketing research, (iv) production, (v) raising funds, (vi) maintaining accounts books, etc. This is the step of grouping the work into specific departments, also known as departmentalisation. Say for example the government plans on promoting cottage i… This implies the allocation of authority and responsibility among employees of the enterprise in such a way that each person should know who is responsible to whom and for what. To equip every individual to effectively shoulder the duties and responsibilities assigned to them, there must be delegation of authority. Explain the steps involved in the process of organising. In order to create a balance and structure in the organisation, the activities of members need to be well-coordinated. The demand is to meet the needs of customers, employees and other organisational stockholders. What kind of organisation structure is best suited to an enterprise depends upon a number of considerations; the more important ones are given below: Organisation structure to be used for an enterprise is the direct result of objectives to be achieved which are derived from strategy. For accomplishing the works which are similar in nature different tasks, processes or skills required are to be placed together so as to achieve the organisational objectives. Here, the total organisation is made up of teams or work groups which perform the organisation’s work. They can be grouped on the basis of functions, products, Example – The teacher should have assigned the responsibility of boards to one group, library maintenance to another and collection of notebooks to the third group. For example- the activities like the purchase of raw material, purchase of ready-made parts, production, stocking the material, research, etc., are assigned to the production department. Finally, evaluation of activities is done to judge the effectiveness of performance of the different departments. Grouping of Activities 4. In fact, organization activities are detailed in terms of objective to be achieved. Providing Physical Facilities and Right Environment 10. Assigning Work, Responsibility and Authority: 6. Each position has a set of tasks, responsibilities, and authority. Constant appraisal and reorganisation is an integral part of the organising process. Terms of Service 7. Nature of the organising function can be understood in reference to the following aspects: 1. An organisation structure is the structural framework of all positions in a set-up. We shall discuss it in greater detail in the next chapter. Distribution of authority involves addressing two issues – delegation of authority and centralisation-decentralisation. It is meant for achieving specific goals. Resources are scarce and coordination helps in their optimum utilisation. For example- banking activities in a bank include managing accounts, providing loans, managing foreign currency, managing customer queries, etc. For a sound and well-defined organising process, a business needs to undertake the following steps: Organising as a function begins with identifying all activities that are planned for a business based on their mission, goals and objectives. The second issue is centralisation (retaining power and authority in the hands of top-level managers) and decentralisation (distribution of authority to middle and lower-level mangers). For example, a manufacturing concern will have production, marketing and other activities. After creating departments, departmental heads are appointed to carry out the activities of their respective departments. Image Guidelines 4. It is at this stage that members of the organisation know from whom each has to take instructions and to whom one has to issue instructions. Here, both vertical and horizontal operating relationships are determined. The six steps are: Clarify strategy – Clarify high-level strategy statements, separating and organizing goals, objectives, initiatives, aspirations, and strategies. Lines of accountability are drawn in black and white. Each job should be classified under some category. Through it, activities are divided, grouped-up and assigned to the concerned department having requisite competence, and resources, and the department develops as a specialised centre for those activities. The point to remember, in order prevent discouragement, is that organizing is a ongoing PROCESS and not a destination. It is very important that for effective implementation of plans the work is assigned to such people who possess essential abilities and skills to perform their jobs with maximum efficiency. It is only after granting authority to an individual that he can be made accountable. Organising is designed on the basis of objectives and it aims at achieving them smoothly. For example, Purchase Department for purchase functions, Finance Department for financing activities, Marketing Department for marketing activities, etc. Organising an event can seem like an incredibly overwhelming task. Ensures optimum utilisation of resources: Allocation of resources is the core activity of organisation structure. On the basis of geography – Activities are grouped on the basis of geographical locations. A realistic look must be taken at the prospect of these new opportunities and SWOT analysisshould be done. The organising process involves five broad steps: It is necessary to determine those activities which are essential to accomplish the organisational objectives. Thereafter, a number of groups will be combined and grouped into larger units or departments. This may involve you sending a tailored CV and cover letter in response to an advertised position or going through an online application process. If an organisation has a product line then, activities can be grouped on the basis of products viz. People know who is to direct whom for what results. Collecting Human and Material Resources 5. The clearly defined relationships helps to create a hierarchal structure and facilitates coordination amongst different departments. Important steps involved in the process of organising are: 1. These activities are arranged in a logical manner so that the performance of one activity facilitates the performance of other activities. Understanding. Employees are assigned and granted with duties and responsibilities through a document called ‘job description’ that clearly defines their responsibilities as shown in the table below. Determination of Objectives Division of Activities 2. are made the basis of primary grouping. Its purpose is to satisfy social and personal needs of employees. It makes the optimum utilisation of human and material resources. The concentration goes to activities and functions. Based on competence of individual and group acceptance. Thus, channels of communications are also created. The concentration goes to activities and functions. Every department works under the supervision of departmental head and is governed by a set of rules, procedures and standards. This grouping or combining of activities is called departmentation. Organising process aims at achieving higher efficiency because it helps in making efficient utilisation of both human as well as physical resources. Departmentalization means selecting the activities which are similar in nature and grouping them together. 5. Right man is put in the right job. 2. It is because when employees accept assigned work, they become responsible for performing it, and for discharging responsibility they are given requisite authority. The degree of authority reduces as the hierarchy flows towards lower level of management. As an alternative to job design, managers have five alternative approaches – job rotation, (moving employees from one job to another), job enlargement (giving employees more tasks to perform), job enrichment (increasing the number of activities and also control over the job), job characteristics approach (jobs diagnosed and improved along skill variety, task identity, task significance, autonomy and feedback), and work-teams (to design the work systems). 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