ORGANISING AND STAFFING

Module -3/ Unit- 5

Module Unit Content

Organising: Concept – Organizational Structure – Centralization
and Decentralization – Departmentalization – Delegation of
5
Authority – Span of Management
3
6 Staffing: Concept – Elements – Recruitment and Selection – Job
Analysis and Job Description – Training and Development –
Performance Appraisal

V.R Renju chandran

Asst.Professor, PGDCM
Organizing
Meaning of Organizing
Once the objectives and plans are laid down, management has to identify and
establish productive relationships between various activities and resources for
implementing plans. In general words organising refers to arranging everything in
orderly form and making the most efficient use of resources. The aim of organizing
is to enable people to work together for a common purpose. ‘Organizing is the
process of identifying and grouping the work to be performed, defining and
delegating responsibility and authority and establishing relationships for the
purpose of enabling people to work most effectively together in accomplishing
objectives.’

Definition of Organising
Organising is the process of identifying and grouping the work to be performed,
defining and delegating responsibility and authority, and establishing
relationships for the purpose of enabling people to work most effectively together
in accomplishing objectives. Louis Allen
Organising is the process of defining and grouping the activities of the enterprise
and establishing authority relationships among them. Theo Haimman

Importance of Organising
1. Benefits of specialisation: Organising leads to a systematic allocation of jobs
amongst the work force. This reduces the workload as well as enhances
productivity because of the specific workers performing a specific job on a
regular basis. Repetitive performance of a particular task allows a worker to gain
experience in that area and leads to specialization.
2. Clarity in working relationship: It helps in creating well defined jobs and also
clarifying the limits of authority and responsibility of each job. The superior-
subordinate relationship is clearly defined in organizing.
3. Effective administration: Organising provides a clear description of jobs and
related duties. This helps to avoid confusion and duplication. Clarity in working
relationships enables proper execution of work. Management of an enterprise
thereby becomes easy and this brings effectiveness in administration.
4. Optimum utilisation of resources: Organising leads to the proper usage of all
material, financial and human resources. The proper assignment of jobs avoids
overlapping of work and also makes possible the best use of resources.
Avoidance of duplication of work helps in preventing confusion and minimising
the wastage of resources and efforts.
5. Adaptation to change: The process of organising allows a business enterprise
to accommodate changes in the business environment. It allows the organisation
structure to be suitably modified and the revision of inter-relationships amongst
managerial levels to pave the way for a smooth transition. It also provides much
needed stability to the enterprise as it can then continue to survive and grow
inspite of changes.
6. Expansion and growth: Organising helps in the growth and diversification of
an enterprise by enabling it to deviate from existing norms and taking up new
challenges. It allows a business enterprise to add more job positions, departments
and even diversify their product lines. New geographical territories can be added
to current areas of operation and this will help to increase customer base, sales
and profit.
7. Development of personnel: Organizing aids personnel development by fostering
creativity, reducing managers' workload, and allowing time for innovation.
Through delegation, subordinates gain problem-solving skills, leadership
experience, and opportunities to realize their full potential, benefiting both
individual growth and organizational success.

NATURE OR CHARACTERISTICS OF ORGANIZING

1. Division of Work: Division of work is the basis of an organization. In other
words, there can be no organization without division of work. Under division
of work the entire work of business is divided into many departments. The
work of every department is further sub-divided into sub-works. In this way
each individual has to do the saran work repeatedly which gradually makes
that person an expert.
2. Coordination: Under organizing different persons are assigned different
works but the aim of all these persons happens to be the some - the attainment
of the objectives of the enterprise. Organization ensures that the work of all
the persons depends on each other’s work even though it happens to be
different. The work of one person starts from where the work of another
person ends. The non-completion of the work of one person affects the work
of everybody. Therefore, everybody completes his work in time and does not
hinder the work of others. It is thus, clear that it is in the nature of an
organization to establish coordination among different works, departments
and posts in the enterprise.
3. Plurality of Persons: Organization is a group of many persons who assemble
to fulfill a common purpose. A single individual cannot create an
organization.
4. Common Objectives: There are various parts of an organization with
different functions to perform but all move in the direction of achieving a
general objective. Well-defined Authority and Responsibility: Under
organization a chain is established between different posts right from the top
to the bottom. It is clearly specified as to what will be the authority and
responsibility of every post. In other words, every individual working in the
organization is given some authority for the efficient work performance and
it is also decided simultaneously as to what will be the responsibility of that
individual in case of unsatisfactory work performance.
5. Organization is a Structure of Relationship: Relationship between persons
working on different posts in the organization is decided. In other words, it is
decided as to who will be the superior and who will be the subordinate.
Leaving the top level post and the lowest level post everybody is somebody's
superior and somebody's subordinate. The person working on the top level
post has no superior and the person working on the lowest level post has no
subordinate.
6. Organization is a Machine of Management: Organization is considered to
be a machine of management because the efficiency of all the functions
depends on an effective organization. In the absence of organization no
function can be performed in a planned manner. It is appropriate to call
organization a machine of management from another point of view. It is that
machine in which no part can afford tube ill-fitting or non-functional. In other
words, if the division of work is not done properly or posts are not created
correctly the whole system of management collapses.
7. Organization is a Universal Process: Organization is needed both in
business and non-business organizations. Not only this, organization will be
needed where two or mom than two people work jointly. Therefore,
organization has the quality of universality.
8. Organization is a Dynamic Process: Organization is related to people and
the knowledge and experience of the people undergo a change. The impact of
this change affects the various functions of the organizations. Thus,
organization is not a process that can be decided for all times to come but it
undergoes changes according to the needs. The example in this case can be
the creation or abolition of a new post according to the need.
Organisation Structure
An organization structure is a framework that allots a particular space for a particular
department or an individual and shows its relationship to the other. An organization
structure shows the authority and responsibility relationships between the various
positions in the organization by showing who reports to whom. It is an established
pattern of relationship among the components of the organization.

Significance of Organization Structure

 Properly designed organization can help improve teamwork and productivity
by providing a framework within which the people can work together most
effectively. Organization structure determines the location of decision-
making in the organization.
 Sound organization structure stimulates creative thinking and initiative among
organizational members by providing well defined patterns of authority.
 A sound organization structure facilitates growth of enterprise by increasing
its capacity to handle increased level of authority.
 Organization structure provides the pattern of communication and
coordination.
 The organization structure helps a member to know what his role is and how
it relates to other roles

PRINCIPLES OF ORGANIZATION STRUCTURE

1. Line and Staff Relationships:
Line Authority: This refers to the direct chain of command from top
management to the lowest level of the organization. Line employees are
directly involved in the core activities that contribute to the organization's
primary goals.
Importance: The relationship between line and staff is critical for effective
coordination and decision-making. It ensures that while line employees focus
on achieving strategic objectives, staff employees provide necessary support
and expertise.
2. Departmentalization:
Definition: Departmentalization involves grouping activities and functions
into departments based on various criteria.
Importance: Departmentalization helps in specialization, improves efficiency,
and facilitates better coordination and control within the organization.
 3. Span of Control:
Span of control refers to the number of subordinates a manager can effectively
supervise. Deciding the span of control is important for coordinating different
types of activities effectively.
4. De-centralization and Centralization:
De-centralization: This involves delegating decision-making authority to
lower levels of the organization. It empowers employees and can lead to faster
decision-making.
Centralization: In a centralized structure, decision-making authority is
concentrated at higher levels. This can ensure consistency and control but may
slow down decision-making processes.
Importance: The degree of centralization or de-centralization depends on
various factors such as the organization's size, complexity, and strategic goals.
Modern organizations tend to favor de-centralization to enhance flexibility
and responsiveness.
Types of Organisation Structures
The organizational structure of a company is a critical factor in its success, as
it determines how efficiently it can achieve its goals.
The organizational structure can be classified under two
categories which are as follows:
I. Functional structure and
II. Divisional structure
Functional Structure
A functional structure organizes employees based on the similarity of their
jobs. Departments are created for each major function, such as production,
marketing, finance, and human resources. Each department reports to a
coordinating head.
Advantages
a. Specialization: Promotes efficiency by allowing employees to
specialize in specific tasks.
b. Control and Coordination: Enhances control and coordination within
departments due to similar tasks.
c. Efficiency and Profit: Increases managerial and operational
efficiency, leading to higher profits.
d. Economies of Scale: Minimizes duplication of effort, leading to cost
savings.
e. Training: Simplifies training by focusing on a limited range of skills.
f. Attention to Functions: Ensures that all functions receive appropriate
attention.
Disadvantages:
1. Overemphasis on Departmental Objectives: Can lead to "functional
empires" where departmental interests overshadow organizational
goals.
2. Coordination Issues: Difficulties in coordinating across functionally
differentiated departments.
3. Conflict of Interests: Potential for conflict when departmental
interests are incompatible.
4. Inflexibility: Risk of narrow perspectives and lack of cross-functional
experience among managers.
Divisional Structure
In a divisional structure, the organization is divided into separate business
units or divisions, each with its own manager responsible for performance.
Each division is multifunctional, handling various functions like production,
marketing, finance, etc., to achieve a common goal.
Advantages
1. Product Specialization: Develops varied skills in divisional heads,
preparing them for higher positions.
2. Accountability: Clear accountability for profits and losses, making
performance measurement and responsibility assignment easier.
3. Flexibility and Initiative: Promotes flexibility and faster decision-
making as each division operates autonomously.
4. Expansion and Growth: Facilitates expansion by adding new
divisions without disrupting existing operations.
Disadvantages:
1. Inter-Divisional Conflicts: Potential for conflicts over resource
allocation and profit maximization at the expense of other divisions.
2. Cost Increases: Risk of increased costs due to duplication of activities
across divisions.
3. Power Concentration: Divisional managers may gain too much power
and act independently, ignoring organizational interests.
Staffing
Introduction:
Staffing is the third function of management. Staffing includes recruitment, selection, training,
developing, promotion and compensation of personnel. It is the process of hiring and developing
the required personnel to fill various positions in the organization. It involves estimating the
number and type of personnel required, recruiting and developing them, maintaining and
improving their competence and performance.
Staffing may also be defined as the process of identifying, assessing, placing, developing and
evaluating individuals at work.
Definitions of staffing as given by various management thinkers are as follows:
Theo Haimann defines staffing as “Staffing pertains to recruitment, selection, development and
compensation of subordinate.
According toMc Farland, “Staffing is the function by which managers build an organization
through the recruitment, selection, and development of individuals as capable employees”.
IMPORTANCE
1. Staffing helps in discovering and obtaining competent and personnel for various
2. jobs.
3. It helps to improve the quantity and quality of the output by putting the right
4. person on the right job.
5. It helps to improve job satisfaction of employees.
6. It facilitates higher productive performance by appointing right man for right job.
7. It reduces the cost of personnel by avoiding wastage of human resources.
8. It facilitates growth and diversification of business.
9. It provides continuous survival and growth of the business through development
10. of employees.

Elements of Staffing
MANPOWER PLANNING
Manpower planning is finding out the number and quality of people required to fillvarious
positions in the enterprise. It also involves evaluating the manpoweralready in the organization
and to develop the requisite talents among thoseselected for promotion advancement.

RECRUITMENT AND SELECTION

Recruiting involves attracting candidate to fill the positions in the organization structure. Before
recruiting, the requirement of positions must be cleared identified. It makes easier to recruit the
candidates from the outside. Enterprises with a favorable public image find it easier to attract
qualified candidates.
Definitions –
1. Mc Fariand, “The term recruitment applies to the process of attracting potential employees of
the company.”
2. Flippo, “Recruitment is the process of searching prospective employees and stimulating them
to apply for the jobs in the organization.”
Need of recruitment
The need of recruitment may arise due to following situations:
1. Vacancies due to transfer, promotion, retirement, permanent disability or death of worker.
2. Creation of vacancies due to expansion, diversification or growth.
Methods and sources of recruitment
According to ‘Dunn and Stephens’ recruitment methods can be classified
into three categories:
1) Direct Methods
2) Indirect Methods
3) Third Party Methods
Direct Methods include travelling visitors to educational and professional institutions,
employee’s contacts with public and manned exhibits and waiting lists.
Indirect Methods include advertising in newspaper radio, in trade and professional journals,
technical journals, brochures etc.
Third Party Methods includes the use of commercial and private employment agencies, state
agencies, placement offices of the colleges and universities, and professional association recruiting
firms.
Sources of Recruitment
The various sources of recruitment may be classified as
A. Internal sources or from within the organisation
B. External sources or recruitment from outside.
A. Internal sources – Many organisations in India give preference to people within the company
because the best employees can be found from within the organisation itself. Under this policy, if
there is any vacancy the persons already working in the organisation are appointed to fill it. This
method is followed mostly in
Government organisations.
B. External sources or recruitment from outside – Internal sources may not always fulfill the
needs of an organisation. Naturally, most of the concerns have to look for the external sources for
recruitment the required number of employees with the requisite qualifications.
Selection
Selection is the process of choosing the most suitable person for the current position or for future
position from within the organization or from outside the organization. The selection of managers
is one of the most critical steps in the entire process of managing
PROCESS OF SELECTION
Selection means the taking up the different workers by various acts from the application forms
invited through different sources of internal and externals.
According to Dale Yoder, “Selection is the process in which candidates by employment are
divided into two classes those who are to be offered employment and those who are not.”
Selection Procedure:
Selection of workers is regarded as a policy matter. Every enterprise has its own policy for
recruitment. The following procedure is adopted.
1) Receiving and screening the application: After receiving the applications have to be screened.
In this process the applications of candidates without the requisite qualification is rejected.
2) Sending the Blank application form: After preparing the list of candidates suitable for job,
blank application forms will be sent to the candidates. In this application form information should
be given about the name and address of the candidate, educational qualification, experience, salary
expected etc.
3) Preliminary Interview: The interviewer has to decide whether the applicant is fit for job or
not. By this interview the appearance, attitudes, behaviour of the candidate can be known easily.
4) Administering Tests: Different types of test may be undertaken. Tests are conducted for the
knowledge of personal behaviour, efficiency of work and interest. Generally, following types of
tests are conducted.
i) Achievement Test
ii) Aptitude test
iii) Trade Test
iv) Interest Test
v) Intelligence Test etc.
5) Checking References on Investigation of Previous History: Applicants are generally asked
to give names of at least two persons to whom the firm may make a reference.
6) Interviewing: Interview is the most important step in the selection procedure. In interview, the
intimation given in the application form is checked. Interview helps in finding out the physical
appearance and mental alertness of the candidate and whether he possesses the required qualities.
Interviews may be of various kinds these are
1) Direct Interview
2) Indirect Interview
3) Patterned Interview
4) Stress interview
5) Systematic in – depth interview
6) Board of panel interview
7) Group interview
7) Final Selection: On the basic of results of previous interview the candidate is
informed whether he/she is selected for the said post or not.

TRAINING AND DEVELOPMENT

Training is an instrument of developing the employees by increasing their skills and improving
their behavior. Technical, managerial skills are needed by the employees for performing the jobs
assigned to the. Training is required to be given to new employees as well as existing employees.
The methods to be used for training and the duration for which training should be given is decided
by the management according to the objectives of the training, the number of persons to be trained
and the amount of training needed by the employees.
Training leads to overall personal development. The major outcome of training is learning.
Trainees learn new habits, new skills, useful information that helps to improve their
performance.
Definition
According to Flippo: “Training is an act of increasing the knowledge and skill of an employee for
doing a particular job.”
Importance of training and development:
1. Reduction in learning time
2. Better performance
3. Reduced supervision
4. Increases Morale of the employees
5. Facilitates organizational stability and flexibility
6. Develops employee’s skills, talents, competency
7. Decreased accidents
8. Better use of raw material and other resources
9. Increase in production

Development
Development is a continuous process. It is fox for refreshing information knowledge and skills of
the executives. In the case of development, off the job methods are used. It provides wider them
capable to face organizational problems and challenges is a bold manner. Management
development is a planned systematic process of learning. It is designed to induce behavioural
change in individuals by cultivating the mental abilities and inherent qualities through the
acquisition and Understanding of use of new knowledge

PERFORMANCE APPRAISAL
Performance appraisal is one of the oldest and most accepted universal principles of management.
It refers to all the formal procedures used in working organizations to evaluate the personalities,
contributions and potentials of group members. It is used as a guide by formulating a suitable
training and development programme to improve the quality of performance in his present work.
Performance appraisal is the judgment of an employee’s performance in a job. It is also called as
merit rating. All managers are constantly forming judgment of their subordinates and are
continuously making appraisals. It is the systematic evaluations of the individuals with respect to
his performance on the job and his potential for development. The immediate superior is in-charge
of such appraisal. The managerial appraisal should measure both performances in achieving goals
and plans as well as all managerial function such as planning, organizing, leading and controlling.
Objectives of performance appraisal:
1. To help a manager to decide the increase in pay on ground of merits.
2. To determine the future use of an employee
3. To indicate training needs.
4. To motivate the employees to do better in his or her present job.
5. To contribute the growth and development of an employee.
6. To identify employees for deputation to other organizations
7. To help in creating a desirable culture and tradition in the organization.
8. To nominate employees for training programs.