Unit-4 Business Organization | BBA 1st Year 2023

Business Organization | BBA 1st Year 2023-Welcome to our BBA 1st Year 2023 notes on Unit-4 Business Organization! 🚀 In this comprehensive guide, we’ll delve deep into the essential concepts, strategies, and secrets that will help you excel in Unit-4 Business Organization. Whether you’re a student or a business enthusiast, this website is your key to success in BBA 1st Year 2023. Stay tuned and explore the world of business organization like never before!

Unit-4

Organization

Meaning and definition

• Organization is the establishing of effective authority relationship among selected work, persons and work places in order for the group to work together efficiently.
• Organization ensues that efforts are directed towards the attainment of goals in such a manner that resources are used optimally and people are able to work collectively and effectively for a common Purpose.

Steps in organization process

• Identification and division of work
• Grouping the jobs departmentalization
• Assignment of duties
• Establishing reporting relationships

Importance of organization

• Benefits in specialization
• Clarity in working relationships
• Optimum utilization of resources
• Adaption to change
• Role clarity
• Development of personnel
• Expansion and growth

Organizational structure

• Organizational structure can be defined as “Network of job positions, responsibilities and authority at different levels.” Or it can be called as a frame work within which managerial and operational tasks are performed.

Types of organizational structure

1. Functional structure
2. Divisional structure

Functional structure

• When the activities or jobs are grouped keeping in mind the functions or the jobs then it is called functional structure.

Advantages of functional structure

• Specialization
• Easy supervision
• It helps in increasing managerial efficiency
• Effective training

Disadvantages of functional structure

• Difficulty in achieving organizational goal
• Decease in coordination
• Difficulty in coordination
• Conflict of interest
• Inflexibility

Divisional structure

• When jobs related to one product are grouped under one department it is termed as divisional structure

Advantages of divisional

• Product specialization
• Fast decision making
• Flexibility
• Expansion and growth

Disadvantages of divisional structure

• More resources required
• Departmental conflicts
• Costly
• Ignore organizational interests

Centralization and decentralization

• Centralization and decentralization refers to extent to which the authority and responsibility is passed to lower levels.

Centralization

• Centralization of authority refers to concentration of the decision making power at the top level of management.
• In a centralized organization managers at lower levels have limited role in decision making, they have to just execute the decisions taken at the top level

Decentralization

• Decentralization refers to evenly and systematic distribution of managerial authority form top level of management to middle and lower levels.

Importance of decentralization

• Develops initiative among subordinates
• Develops managerial talent for the future
• Quick decision making
• Relief to top management
• Facilitates growth
• Better control
  

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Delegation of authority

• Delegation of authority refers to a process of sharing of tasks or responsibility and authority between a manager and his subordinate.
• It is a downward transfer of authority from a superior to subordinate.
• Delegation is a pre requisite for the efficient functioning of an organization.
• It enables a manager to concentrate on higher priority activities it also satisfies the subordinates need for recognition and provides him an opportunity to develop an exercise initiative.

Elements or process of delegation

• Authority
• Responsibility
• Accountability
  

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Importance of delegation of authority

• Effective management
• Employee development
• Motivation of employees
• Facilitation of growth
• Basis of management hierarchy
• Better coordination

FAQ

Question: What is organization?

Answer: organization is a process in which things are arranged in structured and systematic way.

Question: What is centralization?

Answer: centralization is an organization concept where decision-making authority and control are concentrated in one place.