Organization is a process of welding together a frame work of positions, which can be used as a management tool for the most effective pursuit of the objective of an enterprise. It is one of the fundamental function of the management. Various authors have defined the term organization in different ways. According to Davis “Organization is a group of people who are co-operating under the direction of leadership for the accomplishment of a common end.” According to Denyers “organization is concerned with the arrangement of work, with division of activities and with the allocation of duties authority and responsibility.”
The above definitions of organization reveal the following features :
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It consists of a group of persons.
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It shows a clear definition of objective.
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The overall objective is broken into several objectives.
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he group of persons in the organization work under the direction of executive leadership.
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It arranges task in such a way as to ensure one way flow of work.
Every living organism has within it the seeds of its own destruction. Like this the success or failure of an organization depends on its constituents. Establishment of a sound organization is of greatest importance because it facilitates better administration and it provides optimum use of the technological improvements. If the organization attains the desired objective it is a sound organization.
Principles of a Sound Organization
The soundness or unsoundness of an organization largely depends on its degree of attainment of the organizational objectives. Some of the important principles of a sound organization are:
1. Principles of Organizational Objectives
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The object of an organization should be clearly defined as lack of design in organization is illogical, cruel, wasteful and inefficient. So every part of the organization should be intended for the attainment of the enterprise objective.
2. Principles of Specialization
In small scale organization the manager becomes jack-of-all- trades as he performs all the functions. But in large scale organisation the situation is completely different and thus the primary function of an organization is to determine and establish separate entities and thereby encourage division of work. Division of work encourages specialization.
3. Principles of Unity of Function
The modern business consists of various functions like production, marketing, finance and personnel. Each of the above functions are again subdivided into number of sub functions. These functions are interrelated and organization tries to attain the principles of unity of functions which means working together for the accomplishment of the common organizational objective.
4. Principles of Definition
The authority, responsibility and duties in the organization should be clearly defined and it should be in writing. When there is clear-cut definition of the above, the individuals in the organization tries to attain the work within the specified time span.
5. Principles of Span of Control
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There is a limit to the number of persons that an individual can manage effectively and efficiently. The maximum number of persons that can be supervised effectively by a person is known as span of supervision or span of control. The span of control should be limited to a reasonable number and a span of control of 6 subordinates is considered to be an effective span.
6. The Scalar Principles
The chain of authority or command must be clearly defined. The chain of authority refers to the formal specifications of “Who reports to whom”. Each employee in the organization must know who is his superior and to whom policy matters will be referred for decision making.
7. Principle of Delegation
This principle states that when the manager is overburdened with official work, he divides the work among the subordinates so as to ensure proper accomplishment of the objective. The authority delegated to an individual should be adequate so as to ensure that he discharges his duties efficiently.
8. Authority should Commensurate with Responsibility Assignment of responsibility should be coupled with authority sufficient to carry them out because a man’s responsibility without authority is just like to place the man in an impossible position. Without
commensurate authority and responsibility, a man can-not be held accountable for unsuccessful completion of the work.
9. Principles of Simplicity
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The set up of organization should be simple and easy to understand as simple organization structure results in better understanding of the goal of the enterprise.
10. Principles of Flexibility
The organization structure should be flexible so that adjustments due to changed^ circumstances can be planned properly.