3. Classification of activities: In the third step activities are classified according to similarities and
common purposes and functions and taking the human and material resources into account.
For instance - the various activities connected with production, may be grouped and classified as
production department.
4. Fitting individuals into Functions: Each person in the group will be given a specific part of the
job to do and will be made responsible for it. For instance - appointment of workers, foremen,
supervisors etc.
5. Assignment of Authority for action: The manager will have to pass on studied either by a
researcher from outside or by someone within the organisation working as a researcher.
11.6 SIGNIFICANCE An organisation is not merely a chart or a lifeless structure. It comprises people and is the agency
through which management performs the important functions of direction, co-ordination, motivation
and control and implements the function of planning. Both as a process and as a structure, is important
as without it no manager can get work done through people. Following are some of the advantages
of a good organisation.
1. Helps in optimum utilisation of Technological Innovations: The technological improvements
are taking place every time and management is required to make use of them to exist in competitive
world. The organisation should be flexible to incorporate all new-requirements. There may be also be
a need to delegate new powers for making best utilisation of technological changes.
2. Helps in administration: A good organisation is an asset to the management. It helps in achieving
organisation goals through the exercise of effective controls, organisation provides a channel for
better management.
3. Promotes growth and diversification: Area and activities of a business grow if it has a well knit
organisation. There will be a need for employing more persons whenever expansion and diversification
takes place. A flexible organisational structure will enable the employment of more persons without
disturbing the working.
11.6
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