Organising

Organising is the process of identifying and grouping the activities to be performed, defining authority and responsibility relationships, and coordinating them to achieve common goals. In this chapter you will study the four steps of the organising process: identification and division of work, departmentalisation, assignment of duties and establishing reporting relationships. You will also learn why organising is important: it brings benefits of specialisation, clarity in working relationships, optimum use of resources, adaptation to change, effective administration, development of personnel and expansion and growth. The chapter then explains organisation structure and the span of management, and compares functional and divisional structures with their advantages, disadvantages and suitability. You will distinguish formal organisation from informal organisation, and study delegation of authority with its three elements, authority, responsibility and accountability, and why accountability cannot be delegated. Finally, you will learn about decentralisation, its importance, and how it differs from delegation.

Detailed Worksheet: Organising Section A - Definitions (10 marks) 1. Define organising. List the steps in the process of organising. (2 marks) 2. What is span of management? How does it affect the shape of an organisation structure? (2 marks) 3. Distinguish between formal and informal organisation on two bases. (2 marks) 4. Explain the three elements of delegation. Which element can never be delegated? (2 marks) 5. Define decentralisation. Why is it said to be an optional policy decision? (2 marks) Section B - Calculations and Applications (15 marks) 6. A company has 256 workers. If the span of management is 4 at every level, calculate the number of supervisors needed at each level up to the top, the total number of managers and the number of levels of management (excluding workers). Repeat the calculation for a span of 16. (3 marks) 7. A company with 10 product lines has a divisional structure with separate production, marketing and finance in each division. Its annual cost of duplicated functional staff is Rs 2.4 crore. If it switched to a functional structure, it would save 40% of this cost. Calculate the saving and explain one disadvantage of switching. (3 marks) 8. Identify the type of organisation structure suitable in each case: (i) a firm making only cement (ii) a firm making cosmetics, garments and packaged food (iii) a small software company providing one type of service (iv) a conglomerate with businesses in steel, telecom and retail. (3 marks) 9. Identify the element of delegation in each case: (i) the sales manager has the right to give discounts up to 5% (ii) the salesperson is obliged to achieve the target (iii) the salesperson must report achievements to the sales manager. Also state the direction in which each flows. (3 marks) 10. A retail chain has 120 stores. Earlier, the head office took all decisions on pricing and stock. Now store managers decide on local stock and staff scheduling. Identify the concept, and state two benefits it gives to the chain. (3 marks) Section C - Diagrams (10 marks) 11. Draw organisation charts of (i) a functional structure for a company with production, marketing, finance and human resource departments, and (ii) a divisional structure for a company with three product divisions. (4 marks) 12. Draw a flowchart showing the steps of the organising process. (3 marks) 13. Draw a diagram comparing a tall structure (narrow span) and a flat structure (wide span), labelling the number of levels. (3 marks) Section D - Analysis and Higher-order Thinking (15 marks) 14. Compare the functional structure and the divisional structure on five bases: formation, specialisation, responsibility, managerial development and cost. Analyse why a company that grows from one product to many products shifts from a functional to a divisional structure. (5 marks) 15. A manager delegated the task of preparing a tender to his assistant, who missed the deadline. The manager blamed the assistant entirely. Evaluate the manager's position using the principle of absoluteness of responsibility and the elements of delegation, and explain the importance of delegation. (5 marks) 16. In a factory, workers who play cricket together on weekends have formed a close group that spreads information quickly and resists changes in shift timings. Analyse the advantages and disadvantages of this informal organisation, and suggest how management can use it positively. (5 marks) Instructions: Time allowed 2 hours. Attempt all sections. Quote relevant lines from cases while identifying concepts, and draw charts neatly.