Organisation and Society

Need for Organisation

• Organisations serve society and operate within social rules and values.
• They respond to social needs, aiming to make conditions better, safer, cheaper, and enhance the quality of life.
• Organisations achieve objectives that cannot be achieved by individuals, requiring coordination of individual efforts.
• They preserve and extend knowledge, storing and developing it for future generations.
• Organisations provide careers, work, and livelihood, bringing satisfaction and self-fulfillment to employees through efficiency and control.

Organisation Structure

• Definition: An arrangement of lines of authority and communication within a firm, allocating duties and responsibilities.
• It is a supporting framework designed for planning and executing activities of a firm.
• Organisation structure achieves: • Creation of hierarchies and work groups • Mechanism for allocating tasks and responsibilities • Coordination of activities • Setting up of control span • Centralising and decentralising activities • Determining the extent of individual responsibilities

Organisation Structure - Forms

• Project structure: Suitable for undertaking periodic, specialised work and development of a unit.
• Matrix structure: Combines the merits of project structure and functional specialisation with full-time, specialised units capable of handling more than one project at a time.

Organisation Chart

• Definition: A diagram showing the pattern of authority within an organisation, or a diagram showing the formal structure of an organisation and the interrelationships of its parts, positions, and jobs.
• Purpose: • Define system of accountability of a firm • Determine employee status within the management hierarchy • Facilitate organisational design • Prepare management succession plan • Show lines of communication • Show span of control of superiors or management staff
• Types: • Hierarchical: Division into different levels with top-to-bottom line of command • Flat or Horizontal: Few or no levels, used in small or individual unit organisations • Matrix: Same skill groups reporting to their respective managers
• Limitations: • Does not show developed social relationships • Relationships shown are often simplistic and do not reflect actual complex relationships • Easily becomes outdated and changes are often resisted • Does not show management style • De-motivates workers who feel their ranks are lower than expected

Span of Control

• Definition: The number of employees or immediate subordinates controlled by and reporting to a superior.
• Determinants: • Nature of subordinates’ work • Skill, capabilities, qualifications, experience of subordinates and manager • Availability and use of ICT • Subordinates’ knowledge of formal work rules and procedures • Management style and organisation approaches • Depth of organisation hierarchy
• Wide Span of Control: • Has more than six horizontal blocks of work functions • Flat structure with few levels • Subordinates are well trained and enthusiastically carry out instructions • Effective for simple tasks and in organisations with excellent communication
• Narrow Span of Control: • Has a maximum of six horizontal blocks of work functions • Tall structure with many levels • Superiors are able to focus and give full attention to the needs of immediate subordinates • Facilitates and enhances specialisation of function, easy vertical communication, and effective coordination of subordinates’ work