CHAPTER IV

ORGANIZING
 CONCEPT OF ORGANIZING

Organizing is the process of combining together all the

organizational resources and establishing productive
relations among them to achieve predetermined objectives

According to Stoner, Freeman and Gilbert, “ Organizing

is the process of arranging and allocating work, authority
and resources among an organization’s members so that
they can achieve organization’s goal”
Organizing is the function of management that
involves developing an organizational structure and
allocating human resources to ensure the accomplishment
of objectives. The structure of the organization is the
framework within which effort is coordinated.
Characteristics
 IMPORTANCE OF ORGANIZING

Efficient and effective management

Facilitates Specialization
Optimum use of Human Resources
Defines Authority- Responsibility Relationship
Basis of coordination
Establishing channels of communication
 IMPORTANCE OF ORGANIZING

Efficient and effective management: A good

organizational structure is the first requirement of efficient
management. It is the system through which a manager
directs, control and coordinates the business activities.
Facilitates Specialization: An organizational structure
takes care of division and subdivision of various types of
works. This division and classification of work lead to
develop specialization among the workers.
Optimum use of Human Resources: A sound
organizational structure ensures right person to the right
job. It helps to match an individual with his job
 IMPORTANCE OF ORGANIZING

Defines Authority- Responsibility Relationship: A

sound organizational structure clearly defines authority-
responsibility relationship among all the members. It
brings smoothness in organizational performance
Basis of coordination: Organizing is known as the
important means of coordination among various
departments and persons of the enterprise.
Establishing channels of communication: A sound
organizational structure clarifies the channels of
communication through scalar chain. The clear
communication among the member is the basis of
effective completion of defined objective.
 PROCESS OF ORGANIZING

Determination of objectives
 Determination of Activities
 Grouping of Activities
 Establishing Formal Relationship
 Creation of Managerial Position
 Assignment of Works
 Establishment of communication and coordination
 PROCESS OF ORGANIZING
 Determination of objectives
The initial step of organizing is to determine organizational objectives. At the
initial stage corporate objectives of the enterprise are taken into consideration
and later on objectives of departments, sections and individuals are defined in
clear manner.
 Determination of Activities
The second step of organizing process is to determine activities of the
enterprise. This step consists to estimate the total work load that must be
completed to realize objective
 Grouping of Activities
All the activities determined to achieve enterprise objectives must be
classified on the basis nature and should be put at one group or subgroup. This
step of organizing involves creating departments and sections for specific work.
 Establishing Formal Relationship
In order to regulate smoothness in organizational activities and realize results
formal relationship among the members should be established. In other words,
it is essential to define and establish authority and responsibility among all the
members of the enterprise.
 PROCESS OF ORGANIZING
 Creation of Managerial Position
This step concentrates to create managerial position for each
group of works. The creation of managership, a hierarchy of
management comes into existence in the enterprise to specify
superior-subordinate relationship.
 Assignment of Works
After the above activities, the next task of organizing is to
assign duties to each department, section and individual.
 Establishment of communication and coordination
Exchange of information among the members in the
enterprise is a must during the course of performance. Thus, it
is necessary to establish an effective, suitable and speedy
system of communication within the enterprise.
 PRINCIPLES OF ORGANIZING

 Unity of objectives
 Specialization
 Co-ordination
 Authority and Responsibility
 Unity of Command
 Scalar Chain
 Span of Control
 Exception
 Efficiency
 Balance
 Homogeneity
 Continuity
 Simplicity
 PRINCIPLES OF ORGANIZING
 Unity of objectives: This principle implies that the
objectives of various departments must be formulated in
such a way that every individual can contribute his/her
efforts for a single objective.
 Specialization: As far as possible each individuals of the
enterprise should be given specific work on the basis of his
ability. Repetitive functioning of a specific work is helpful
to maintain and develop working efficiency
 Co-ordination: coordination is the essence of organizing.
This principle facilitates to maintain harmonious working
relation among department and employees.
 Authority and Responsibility: There must be a balance
between authority and responsibility.
 PRINCIPLES OF ORGANIZING
 Unity of Command: This principles states that an employee
should receive orders and instructions only from one superior at a
time
 Scalar Chain: this principles implies the unbroken line of
authority from top level to the lowest level of an enterprise
 Span of Control: this principle refers that there should be a
limited number of subordinate so that their work can be
effectively supervised.
 Exception: this principle states that the top level management
must concentrate only on exceptional and creative issues such as
planning, policy making, setting long term goals etc.
 Efficiency: the efficiency of an organization is measured by its
capability to achieve the predetermined objectives effectively and
efficiently.
 PRINCIPLES OF ORGANIZING
 Balance: there must be equal division of work among all
the departments and sections of an organization. There must
be balance between efficiency and efforts
 Homogeneity: According to this principle, every
department should be assigned similar nature of functions.
This helps to ensure unity of direction and coordination of
efforts.
 Continuity: The organizational structure should be
reviewed and modified according to the demand of the
situation.
 Simplicity: this principle emphasizes that the management
must design the simple organizational structure so that all
the members can understand it easily.
ORGANIZATIONAL ARCHITECTURE/Design
concepts
 Organizational architecture is the sum total of all the
systems working in an organization.

 It is essential for systematic and uniform functioning of

the organization.

 According to Hill and McShane, “The term

organizational architecture refers to the totality of a firm’s
organization including formal organizational structure,
control system, incentive system, organizational culture
and people,”
 ORGANIZATIONAL ARCHITECTURE
1. Vertical Differentiation
a. Tall Organization
b. Flat Organization
2. Horizontal Differentiation
a. Functional Organizational Structure
b. Multi-Divisional Organization Structure
c. Geographic Structure
d. Matrix Organization Structure
3. Modern ORGANIZATIONAL Structure
1. Team Based Structure
2. Network Structure
3. 360 Degree Structure
 ORGANIZATIONAL ARCHITECTURE
1. Vertical Differentiation
It refers to location of decision making authority within a
structure. i.e. centralization or decentralization. It also involves
number of layers in management hierarchy i.e. tall or flat.
a. Tall Organization: This structure is developed in a tall or
pyramid shape. It has many layers of management hierarchy.
Under this structure, the main authority is at the top level while
the functional authority is divided among different departments.
Some of the features of this structure are:
 It has centralization of authority
 Narrow span of control and wide division of work
 There is unity of command and is directly from top level of
management
 Mechanistic organization follow
 ORGANIZATIONAL ARCHITECTURE
1. Vertical Differentiation
b. Flat Organization: This structure have few layers of
management hierarchy. Under this structure, the functional
area is expanded on a flat position on the basis of nature of
function. For each functional department, a manager is
appointed for delegation of specified authority and
responsibility. Some of the features of this structure are:
 There is a high level of decentralization of authority
 There is wide span of control
 There are more functional departments
 Organic organization follow
 ORGANIZATIONAL ARCHITECTURE
Tall Organization Flat Organization
 ORGANIZATIONAL ARCHITECTURE
2. Horizontal Differentiation
This structure is concerned with dividing organization into
subunits on the basis of convenience.
It is also concerned with formation of different
departments on different basis.
Horizontal differentiation is defined as the process of
grouping similar jobs together to transform the functional
units in an organization into manageable units so that
similar tasks can be performed at one place.
Larger companies also employ horizontal
differentiation by product type, location or
service. For instance, the head of the
accounting department in a company's New
York office shares the same rank and
responsibilities as his counterpart in the
Chicago office.
TYPES OF ORGANIZATIONAL STRUCTURE
Horizontal Organization

Functional Multi Divisional

Structure Structure

Geographic Matrix
Organization Organization
 FUNCTIONAL STRUCTURE
In functional organization, all business activities of an
enterprise are divided into a number of functions and each
function is entrusted to a specialist.
For instance, business activities of an enterprise may be
divided into various functions like production, marketing,
finance etc.
One of the main features of functional organization is that
a functional manager can exercise functional authority not
only over his own subordinates but also over all
subordinates in all other functional departments of the
enterprise.
FUNCTIONAL ORGANIZATION STRUCTURE

General Manager

Purchase Production Finance Mrketing Personnel

Manager Manager Manager Manager Manager

Subordinates
 ADVANTAGES OF FUNCTIONAL
ORGANIZATION

 Benefits of specialists
 Increase efficiency
 Healthy competition among experts
 Relief to executives
 Mass production
 Facilitates growth and expansion
 DISADVANTAGES OF FUNCTIONAL
ORGANIZATION

 Multiple command system

 Lack of coordination
 High administrative cost
 Delay in decision making
 Spoils human relations
 Shifting responsibility
MULTI DIVISIONAL/ Product STRUCTURE

 This structure is based on multiple business operating

within a larger organizational framework

 Divisional structure is used specially by those business

firms that involve in production of various lines on
products or services in various locations.
 The multidivisional structure consists of a corporate office
and operating divisions which represents a separate
business or profit center.
 Under this, the responsibilities for day to day operations
are delegated to division managers.
Advantages
a. Suitable for multi- business
b. Facilitates specialization and effectiveness
c. Maintains direct attention and dynamism
d. Effective monitoring and evaluation
e. Accountable divisional manager
Disadvantages:
a. chances of conflict
b. lack of coordination
c. problem of effective control
 MULTI DIVISIONAL STRUCTURE

General Manager

Rice Wheat Sugar Beverage

Production Production Production Production

Production Finance Marketing Personnel

Department Department Department Department
 MULTI DIVISINAL STRUCTURE
Advantages
 It is suitable for the organization having various line of
products or services
 It directs attention towards specific product line and service
 It permits maximum use of specialized production/service
Disadvantages
 There may be conflict between production/service as the
responsibilities are interdependent
 It maximizes administrative cost
 The product/service manager may ignore overall objectives of
the organization
 GEOGRAPHIC STRUCTURE

 In this structure, organizational structure is developed on

the basis of geographical distribution of places.
 It is suitable for the organizations such as retail and
hospitality, transportation and other businesses that need
to be near the sources of supply and customers.
 A geographical organizational structure organizes people
within an organization by geographic location. This
structure creates specific divisions for each location. Each
division acts as if it is its own company, combining
different types of personnel for various business functions.
 GEOGRAPHIC STRUCTURE

General Manager

Eastern Western South North

Region Region Region Region

Production Finance Marketing Personnel

Department Department Department Department
 GEOGRAPHIC STRUCTURE

Advantages
 It helps to achieve local operations
 It facilitates the expansion of business into various regions
 It considers the environmental change

Disadvantages
 There may be problem of integration of various regional
offices
 There is the possibility of duplication of physical facilities
 It is more difficult maintain central control over regional
departments
 MATRIX STRUCTURE

 Matrix structure is formed to complete various type of

project of specific and unique nature. It is also known as
project management structure.
 A matrix structure is the most complex of all structures.
Functional and divisional structures depend primarily on
vertical flows of authority and communication. However,
a matrix structure depends upon both vertical and
horizontal flows of authority and communication.
 MATRIX ORGANIZATION
General Manager

Production Finance Marketing Personnel

Manager Manager Manager Manager

Project A Productio Finance Marketing Personnel

Manager n Group Group Group Group

Project B Productio Finance Marketing Personnel

Manager n Group Group Group Group

Project C Production Finance Marketing Personnel

Manager Group Group Group Group
ADVANTAGES OF MATRIX ORGANIZATION

 Better coordination and control

 Adaptable to dynamic environment
 Maximum use of resources
 Participative management
 Sufficient time to top management
 Development of teamwork
DISADVANTAGES OF MATRIX ORGANIZATION

 Violation of unity of command

 Costly structure
 Problem of over specialization
 Difficult to balance
 Feeling of insecurity
 Lack of commitment
 CONCEPT OF AUTHORITY
 Authority is a formal, institutional or legal power of a person
or institution that empowers him/her/it to perform the task
successfully.
 Authority is the right to give order to subordinates

 Authority is the right vested in a managerial position

 It facilitates the manager to occupy managerial position to

direct subordinates

 Manager need to consider rules, regulations and procedures of

the organization for using authority.
Features
Legal or institutional
Has limit
Normally in writing
Centralized or decentralized
Given to position
 TYPES OF AUTHORITY
 Line Authority: It gives right to direct the work of
subordinates and make decisions without consulting others. It
flows vertically from manager to subordinates in the chain of
command.
 1. Line authority
 It is hierarchical form of authority
 It is employer-employee authority relationship that
extends from top to bottom.
 Line authority defines the relationship between superior
and subordinate. It is direct supervisory authority from
superior to subordinate.
 This authority flows downward in an organization directly
from superior to subordinate.
Line manager directs the work of employees and makes
certain decisions without consulting anyone.
 Top management has complete control.
 Advantages of line authority
Simplicity
 Division of authority and responsibility
Unity of command
Speedy action
Discipline Economical
 Coordination
 Direct communication
Flexibility
Staff Authority: It is the right to advise or counsel line
authority. Staff authority supports line authority by
advising, servicing and assisting.
People in these staff positions are empowered to
assist the line functions (such as production and
sales), but do not have any authority over them. As
an example of staff authority, the cost accountant
advises the sales manager on which products have
the highest margins, and so are the most valuable
products to sell.
 2. Staff authority
It is advisory authority
There is a provision of functional specialist.
Staff manager provide support, advice, and knowledge
to other individual in the chain of command.
Staff managers are not part of the chain of command.
Staff authority is the provision of advice and other
services to line managers.
People in these staff positions are empowered to assist
the line functions (such as production and sales), but do
not have any authority over them
Staff authority is the authority to serve in an advisory
capacity. Managers whose role it is to provide advice or
technical assistance are granted.
Advisory authority does not provide any basis for direct
control over the subordinates or activities of other
departments with whom they consult: however, within
the staff manager's own department, he or she exercises
line authority over the department's subordinates.
 Advantages:
Specialization: Line and staff organization introduces
specialization in a systematic manner
Better Discipline
 Balanced and Prompt Decisions
 Growth and Expansion
Development of Employees
 Lesser Burden on Line Officers
 Quick Actions
Functional authority: It is referred to as limited line authority.
It gives power to staff assistants over a particular function.
Functional authority is a special type of authority for staff
personnel , which is designed by top management
 DELEGATION OF AUTHORITY

 Delegation of authority is assigning work to subordinates and

giving them necessary authority to do the work effectively.

Ricky W Griffin, “ Delegation is the act of assigning

formal authority and responsibility for completion of
specific activities to a subordinates.”
 Delegation of Authority
 It is assigning work to subordinates and giving them
necessary authority to do the assigned work effectively.
Increase in size of business and its complexity, needed
delegation of authority.it is a process of dividing the
work among the subordinates by a manager so that he
could multiply his capacity.
 An authority is delegated when the decision making
power is vested in a subordinate by a superior.
 DELEGATION OF AUTHORITY

Features:
 No delegation of total authority
 Delegation of only that authority that a manager has
 Representation of the superior
 Delegation for organizational purpose
 Balance of authority and responsibility
 No Delegation of Full responsibility
 Representation of the supervisor
 ADVANTAGES OF DELEGATION OF
AUTHORITY

 Minimize workload of Managers

 Benefit of Specialization
 Motivation and Morale
 Facilitates growth and expansion
 Quicker and better decision
 Basis of organizing
Steps of DELEGATION OF
AUTHORITY
The step, which is followed when delegating authority,
is the process of delegation. Normally four steps are
used in the process of delegation. It can be shown in
the form of diagram.
(A) Assignment of duties to
subordinates
↓
 Before delegating, the delegator has to decide precisely the duties
which are to be delegated to the subordinate or a group of
subordinates. The authority is delegated accordingly and the
subordinate is told what is expected from him. The usual practice is
to list the functions to be performed by the subordinate. If necessary,
targets to be achieved by the subordinate are also spelt out.
Subordinates may be assigned tasks either in terms of activities or
results. The manager (delegator) must communicate clearly his
expectations. Competent and responsible employees may be given
general guidelines about what needs to be accomplished. Their less
competent and responsible counter-parts need more specific
guidelines. In brief, in the first stage of delegation process, duties are
assigned to the subordinate.
(B) Transfer of authority to
perform the duty

In the second stage of delegation process, the

authority is granted by the delegator to his
subordinate (delegate). Authority must be delegated
strictly to perform the assigned duty. The
performance of duties suffers serious setback when
required authority is not delegated along with the
duty. In brief, the transfer of authority should be
adequate considering the duties assigned to the
subordinate.
C) Acceptance of the assignment ↓
In this third stage of delegation process, the
subordinate/delegate has to accept or reject the task
assigned to him in the first stage along with the authority
given in the second stage. If the delegates refuse, the
delegator has to make fresh plan of delegation or may
consider some other subordinate who is capable and is
willing to accept the assignment. On the other hand, the
process of delegation will move to the fourth and the last
stage, if the first delegates accept the assignment of work
accompanying the authority.
 (D) Creation of Obligation / Accountability / Responsibility
↓
 The fourth stage in the, delegation of authority is the creation
of obligation on the part of the subordinate to perform duties
assigned to him in a satisfactory manner by using the authority
given. When subordinate accepts a task and the authority is
given, an obligation is created. He has to perform the assigned
task by using the authority granted to him. A subordinate is
also responsible/accountable for completing the assigned
work. He is held answerable to a superior for the satisfactory
performance of that work assigned. The delegator has to help
his subordinate as and when necessary as he is responsible
to his superior/organisation.
Reasons for Delegation of Authority
1. To reduce the burden of higher level managers
2. To foster creativity
3. To utilize ability properly
4. To promote trust and motivation
5. To empower junior levels
Advantages of Delegation of Authority
1. Reduces the work load of the managers
2. Improves motivation and productivity
3. Helpful to get benefits of specialization
4. Offers chance for training and development
5. Facilitates growth and expansion
6. Chances for Quicker and Better Decisions
 BARRIERS/Obstacles TO DELEGATION OF AUTHORITY

 Reluctant to delegate
 Fear of losing importance and control
 Lack of proper trust
 Incompetent subordinate
 Lack of motivation
 Authoritarian tendency
 Risk aversion
1. Reluctant to delegate

A manager may be reluctant (unwilling to do

something) delegate authority due to power and
political issues. If managers fail to plan work in
advance, they are reluctant to delegation.
2. Fear of losing importance and control
Delegation of authority makes the lower level more
powerful and they are likely to perform their duties
more effectively. The top levels may take this as a
threat of losing their importance due to which they
may be reluctant to delegate authority.
3. Lack of proper trust

Managers may not trust the subordinates in their

capability in doing the jobs well. In such a situation,
they are reluctant to delegate authority.
4. Incompetent subordinate/ Inability of subordinates:
The subordinates may be reluctant to accept
delegation due to their low capability or lack of interst
and motivation.
Overcoming Obstruction of Delegation:

The following aspects will help to overcome the

obstacles of delegation:
1. Delegation to be Complete and Clearly
Understood:
2. Proper Selection and Training:
3. Motivation of Subordinates:
4. Establishment of Proper Control:
1. Delegation to be Complete and Clearly Understood:
The subordinate must know precisely what he has to know and
do. It should be preferably in writing with specific instructions
so that the subordinate does not repeatedly refer problems to
the manager for his opinion or decisions.
2. Proper Selection and Training:
The management must make proper assessment of subordinates
in terms of their abilities and limitations before delegating the
proper authority. Additionally, management must work closely
with the subordinates in training them in how to improve their
job performance. This constant communication will build up
the self-confidence of the subordinates.
3. Motivation of Subordinates:
Adequate incentive in the form of promotion, status,
better working conditions or additional bonuses must
be provided for additional responsibilities will
performed.
4. Establishment of Proper Control:
Shortcoming can be removed by establishing adequate
controls. In this regard, adequate checkpoints and
controls may be built in the system. For example,
weekly reports.
 DECENTRALIZATION OF AUTHORITY
 Decentralization is the philosophy of systematic and scientific
delegation of managerial authority to the middle and lower
level managers in accordance with their responsibility
 This philosophy states that the top management should keep
limited authority and delegate maximum authority to operating
levels

Louis A. Allen, “ Decentralization is the systematic and

consistent delegation of authority to the level where the
work is performed.”
 ADVANTAGE OF DECENTRALIZATION

 Relief to top management

 Facilitates manager development
 Possibility of better decision
 Effective control
 High morale and motivation
 Environmental adaptation
 DISADVANTAGE OF DECENTRALIZATION

 Increase in expenditure
 Conflict
 Unsuitable for emergency situation
 Maximizes risk
 Difficulty in communication
 Unsuitable for specialized service
 CENTRALIZATION
 Centralization is the systematic reservation of decision making
authority at the top level management.

 Top managers have direct control over each and every business
activity of the organization while the decision making authority
is also vested on him

Ricky W Griffin, “ Centralization is the process of

systematically retaining power and authority in the hands of
higher level managers.”
 ADVANTAGES OF CENTRALIZATION

 Facilitates unified and Quicker decision

 Easy to Manage Crisis and Big Decisions
 Suitable under Environmental Stability
 Simplifies structure
 Economy in operation/ Cost Effective
 Integrate operation
 Suitable for small firms
1. Facilitates unified and
Quicker decision
It is useful if the works demand a high degree of knowledge
and expertise. It also helps to make decisions quicker. Since
the decision making authority is centralized to the upper
level, decisions can be made quickly.
2. Easy to Manage Crisis and Big Decisions
In a crisis, management is required to make quick and bold
decisions. In such a situation, centralization is more effective.
For taking big decisions which affect the whole organization
for a long period of time, centralization is more effective.
3. Suitable under
Environmental Stability
Under stable environment, centralization is suitable
for the operations of an organizations.
4. Cost effective : under this, decision making requires
less time and resources. Hence, it is cost effective.
DISADVANTAGES OF CENTRALIZATION

 Unsuitable for large organization

 Manager is over burdened
 Possibility of power misuse
 Low morale and motivation
 Inappropriate for routine decision
Diffn. Betwn. Delegation and
Decentralization of Authority
 1. Responsibility:
 In delegation, a superior delegates or transfers some rights and duties to a
subordinate but his responsibility in respect of that work does not end.
 On the other hand, decentralisation relieves him from responsibility and
the subordinate becomes liable for that work.
 2. Process:
 Delegation is process while decentralisation is the end result of a deliberate
policy of making delegation of authority to the lowest levels in managerial
hierarchy.
 3. Need.
 Delegation is almost essential for the management to get things done in the
organisation i.e., delegating requisite authority for performance of work
assigned. Decentralisation may or may not be practised as a systematic
policy in the organisation.
 4. Control:
 In delegation the final control over the activities of organisation lies
with the top executive while in decentralisation the power of control
is exercised by the unit head to which the authority has been
delegated.
 5. Authority: Delegation represents selecting dispersal of authority
whereas decentralisation signifies the creation of autonomous and
self-sufficient units or divisions.
 6. Scope:
 Delegation hardly poses any problem of co- ordination to the
delegator of authority. While decentralisation poses a great problem
in this regard since extreme freedom of action is given to the people
by creating self-sufficient or autonomous units.
7. Good Results:
Decentralisation is effective only in big organisations
whereas delegation is required and gives good results in
all types of organisations irrespective of their size.
8. Nature:
Delegation is the result of human limitation to the span
of management. Decentralisation is the other hand, is
the result of the big size and multi-farious functions of
the enterprise.
Devolution:
Devolution is the statutory delegation of powers from
the central government of a sovereign state to govern
at a subnational level, such as a regional or local level.
It is a form of administrative decentralization
Features of Devolution
1. Transfer of power
2. Differs in degree of decentralization
3. Democratic shift
4. Effective decision making
5. Encourages innovation
1. Transfer of power: Devolution is about transfer of
power by central government to local or regional level
administrations.
2. Differs in degree of decentralization
The central authority may develop a different system of
decentralization with in one corporate houses business
units.
3. Democratic shift:
Devolution tries to bring democratic shift by bringing
decision making closer to local units.
Reasons of Devolution
What is devolution? In England, devolution is the transfer
of powers and funding from national to local government.
It is important because it ensures that decisions are made
closer to the local people, communities and businesses
they affect.
1. To optimize goals and benefits
2. To utilize increased capacity
3. To meet the public or staff demand
4. To customize ability and power
5. To exercise democracy in decision
6. To motivate and make responsible
Advantages of Devolution
We believe it is important because it ensures that decisions
are made closer to the local people, communities and
businesses they affect. Devolution will provide greater
freedoms and flexibilities at a local level, meaning councils
can work more effectively to improve public services for their
area.
1. Suitable for federal government and very big organization
2. Easy to take the power back
3. Effective decision making
4. Motivation at lower level
5. Avoid blanket policy
Disadvantages of Devolution
1. Not much suitable in business
2. Difficult or complex concept
3. Possibility of un equal treatment
 CONCEPT OF STAFFING
Staffing is the process of obtaining and maintaining capable
and competent employees to fill all positions from the top level
to the subordinate level.

It includes recruiting, selecting, appointing, training,

appraising and maintaining employees in the organization

According to Theo Haimann, “ Staffing is concerned the

placement, growth, and development of all those members of
the organization whose function is to get the things done
through the efforts of other individuals.”
Characteristics of Staffing/ HRM
1. Managing People at work
2. Concerned with developing the employees
3. Essential in all organizations
4. Continuous in nature
5. Tool for human benefit
6. Strategy focused
7. Social and Dynamic process
8. Involvement of Line manager
1. Managing People at work
HR (Human Resource) is concerned with managing
people at work. It covers all levels of staff. It is
concerned with employees both as individuals as well
as a group. The aim is to get better results with their
collaboration and active involvement in the
organization’s activities.
2. Concerned with developing the employees
The objectives of HRM is not only to use them rather it
also aims to develop them. By this activity both of the
parties will be in win – win situation.
3. Essential in all organizations

Since recruitment, selection development and

utilization of people are an integral part of any
organized effort, so HRM is inherent in all
organizations. It is equally useful and effective in
government departments, military organizations, and
non-profit institutions.
4. Continuous in nature
HRM cannot be practiced only one hour each day or one
day a week. HRM requires a constant alternatives and
awareness of human relations and their importance in
every day operations.
5. Tool for human benefit

HRM (Human Resource Management) attempts at

getting the willing co-operation of the people for the
attainment of the desired goals. It is the double edged
weapon- it offers benefits to both organization and
staff.
 IMPORTANCE OF STAFFING

 Manage effective staff

 Utilization of physical resources
 Increase in productivity
 Focus on goal achievement
 Job satisfaction
 Self development of workers
 IMPORTANCE OF STAFFING
 Manage effective staff: Staffing involves workforce planning,
recruitment, selection, appointment and placement of right
person to the right job. It helps to maintain the right size of the
employees

 Utilization of physical resources: Staffing helps in the

effective utilization of all other physical resources including
money, materials, machines etc. The effective utilization of
resources helps in minimizing wastage.

 Increase in productivity: Staffing focuses on maximum

utilization of resources which increase the productivity of
organization
 IMPORTANCE OF STAFFING
 Focus on goal achievement: The focus of staffing is towards
goal achievement. Thus it involves appointment of right person
to the right job

 Job satisfaction: Staffing give employee utmost satisfaction

and sense of belongingness

 Self development of workers: staffing provides opportunities

and facilities to the employees for their personal development
on the job.
 PROCESS OF STAFFING

 Manpower Planning
 Recruitment
 Selection
 Placement
 Orientation
 Training and Development
 Performance appraisal
 Transfer, promotion and demotion
 PROCESS OF STAFFING
 Manpower Planning: It is the process of estimating
manpower needs and developing appropriate policies and
programs to fulfill the needs. It ensures that the management
has the right number and the right people at the right place and
at the right time
 Recruitment: It is the process for searching for prospective
employees and stimulating them to apply for the job
 Selection: It is the process of choosing the best candidate from
a pool of applicants. It depends upon recruitment and follows
the recruitment process.
 Placement: It is the process of providing appointment and
assigning specific jobs to selected employees . It involves
assignment of right jobs to the right candidate
 PROCESS OF STAFFING
 Orientation: It is the process of introducing new employees to the
organization and its procedures, rules and regulations.
 Training and Development: It refer to the improvement of specific
skills, abilities and knowledge of an employee. It is an attempt to
improve employee’s performance by increasing the ability to perform
through learning.
 Performance appraisal: It is the assessment of an individual’s
performance in a systematic way in terms of requirement of the job.
 Transfer, promotion and demotion: A transfer involves the shifting
of an employee from one job to another of the same level which may
change his duties and responsibilities. Promotion is the advancement
of an employee to a higher position involving greater
responsibilities. Demotion is the downgrading of an employee from a
higher level to the lower level.
MCQ
1. Which of the following is not a principle of
organizing?
a. specialization b. Span of control/supervision
c. Unity of goals/objectives d. Rigidity
2. In which of the following structure, an organization
diversifies its business.
a. Functional structure b. Multidivisional structure
c. Matrix structure d. Geographic structure
3. Which of the following is not a major function of
staffing?
a. Acquisition b. compensation
c. Development d. Controlling
4. Which of the following is the division of work
amongst the employees on the basis of their
qualification, abilities and rules:
a. Control b. supervision
c. Co-ordination d. Command
5. Which type of organization has fewer levels of
management?
a. Flat organization b. Tall organization
c. Big organization d. Small organization
6. Which of the following is the most complex form of
organization structure?
a. Functional structure b. Geographic structure
c. Matrix structure d. Divisional structure
7. Which of the following is the institutional or legal
power of a person?
a. Responsibility b. Authority
c. Accountability d. Devolution
8. Which of the following reduces workload of
managers?
a. Delegation of authority b. Centralization
c. Staffing d. Motivation
1. d
2. b
3. d
4. b
5. a
6. c
7. b
8. a
 ASSIGNMENT
1. Define organization. Explain the importance of organizing.
2. What is span of control ?
3. What is centralization? Explain its advantage and
disadvantage.
4. What is decentralization? Explain its advantage and
disadvantage.
5. Define staffing. Explain its importance
6. Define delegation of authority. Explain the barriers to
delegation of authority.
7. Draw the matrix organization structure