Organization as envisaged by Fayol is the plan for material organization and people organization required to achieve the objectives of the organization. It could have been a part of the planning process. But it is a complex step and hence it is given as a separate function. Subsequent to Fayol, in the management text books material organization was not given any attention. All the attention has gone to people organization. This is a shortcoming of the management theory at this stage (2014).
Organizing is explained currently as the grouping of activities necessary to attain the objectives, the assignment of each grouping to a manager with authority necessary to supervise it,and the provision for coordination horizontally and vertically in the enterprise structure.
Formal organization means the intentional structure of roles specified through a formal organization structure chart.
Informal organization is any joint personal activity without conscious joint purpose, even though contributing to joint results (Chester Barnard).
1. Principles of span of control
2. Departmentation: By numbers, by time (shifts), by function, by territory, br product, by customer segment, by maketing channels, by process (in manufacturing).
3. Line and staff relationships
4. Delegation
The managerial function of staffing is defined a filling positions in the organization structure through identifying work force requirements, inventorying the people available, recruitment, selection, placement, promotion, appraisal, compensation, and training of people.
The managerial function of leading is defined as the process of influencing people so that they will strive willingly and enthusiastically toward the achievement of organizational goals.
The managerial function of controlling is the measurement and correction of performance in order to make sure that enterprise objectives and plans devised to attain them are accomplished. The control actions include planning once again, reorganization, new staffing decision and leading activities.
Control of overall performance refers to the assessment of higher level managers, managers of departments and profit centers.
Control also includes ensuring that all persons in the organization work towards the same ultimate purpose, follow procedures and display acceptable behavior.
Henri Fayol's Description of Management Process
Planning – Foresight is Essential Part of Management
The maxim “Managing means looking ahead.” gives some idea of the importance attached to planning in the business world. To foresee in this context means both to assess the future and make provision for it.
Planning is manifested in variety on a variety of occasions in managing a concern, its chief manifestation, apparent sign and most effective instrument being the plan of action.
The plan of action is, at one and the same time, the result envisaged, the line of action to be followed, the stages to go through, and methods to use.
Plan of Action
Plan of action depends upon what is wanted and what is possible.
In the plan of action, proximate events are outlined with some distinctness, whilst remote events appear progressively less distinct, and it entails the running of the business as foreseen and provided against over a definite period.
Plan of action rests:
1. on the firm’s resources
2. on the nature and importance of work in progress
3. on future trends which depend partly on technical, commercial, financial and other conditions all subject to change, whose importance and occurrence cannot be pre-determined.
Line of Conduct
In line of conduct it is not only imperative that nothing should clash with principles and rules of good management, but also that the arrangement adopted should facilitate application of these principles and rules.
Broad Features of a Good Plan of action
- Unity of plan
- The guiding action of the plan must be continuous.
- The plan should be flexible enough to bend before such adjustments, as it is considered well to introduce, whether from pressure of circumstances or from any other reason.
- Plan must have as much accuracy as is compatible with the unknown factors bearing on the fate of the concern.
Organizing
To organize a business is to provide it with everything useful to its functioning: raw materials, tools, capital, personnel.
*All this may be divided into two main sections, the material organization and the human organization.
*The latter only is dealt with in this paper (This is a statement by Fayol).
Managerial Duties of an Organization
1. Ensure that the plan is judiciously prepared and strictly carried out.
See that the human and material organization is consistent with the objective, resources, and requirements of the concern.
3. Set up a single, competent energetic guiding authority.
4. Harmonize activities and co-ordinate efforts.
5. Formulate clear, distinct, precise decisions.
6. Arrange for efficient selection: Each department must have an employees in places where they can render greatest service.
7.Define duties clearly.
8. Encourage a liking for initiative and responsibility
9. Have fair and suitable recompense for services rendered.
10. See to the maintenance of discipline.
11. See to the maintenance of discipline.
12. Ensure that individual interests are subordinated to the general interest.
13. Pay special attention to unity of command
14. Supervise both material and human order.
15. Have everything under control.
16. Fight against excess of regulations, red tape and paper control
Command
The mission of command is set the organization going.
For every manager the object of command to get the optimum return from all employees of his unit in the interest of the whole concern.
Precepts that Facilitate Command
1. Have a thorough knowledge of personnel.
2. Eliminate the incompetent.
3. Be well versed in the agreements binding the business and its employees.
4. Set a good example.
5. Conduct periodic audits of the organization and use summarized charts to further this.
6. Bring together chief assistants by means of conferences at which unit of command and focusing of effort are provided for.
7. Do not become engrossed in detail.
8. Aim at making unity, energy, initiative and loyalty prevail among the personnel.
4. Co-ordination
To co-ordinate is to harmonize all the activities of a concern so as to facilitate its working, and its success.
It is to keep expenditure proportional to financial resources, equipment and tools to production needs, stocks to rate of consumption, sales to production.
In a Well Co-ordinated Enterprise
1. Each department works in harmony with the rest.
Production knows its target, Finance provides necessary funds and stores procures what is needed.
2. In each department divisions and sub-divisions are precisely informed as to the share they must take in the communal task and the reciprocal aid they are to afford one another.
Weekly Conference of the Departmental Heads
Its main aim is to inform the management about the running of the concern.
To make clear co-operation to be expected as between various departments, and
To utilize the presence of departmental managers for solving various problems of common interest.
Importance of Co-ordinating Conference
The co-ordinating conference is to co-ordination what the plan of action is to foresight, what summarized charts of personnel are to the human organization.
Control
In an undertaking, control consists in verifying whether everything occurs in conformity with the plan adopted, the instructions issued and principles established.
It has for its object to point out weaknesses and errors in order to rectify them and prevent recurrence.
It operates on everything, things, people, actions.
Control by Supervisors and Control by Internal Control Specialists
Head of business and his assistants along the scalar chain do a lot control activity. But there is a need for specialist controllers and inspectors. Properly carried out, this specialist control is precious auxiliary to management and can afford it certain data which official supervision might at times fail to furnish.
Joint Revision Article - 23 January
Planning - A Management Process
January Month Management Revision starts from 15 January Monday
MBA Core Management Knowledge - One Year Revision Schedule
Updated on 23 January 2017, 26 Jan 2016, 27 Jan 2015, 8 Jan 2015
