Saturday, 28 May 2011

Principles of Organization

Business means those activities which are concerned with the production and distribution of goods and services. Earning of profit and satisfying of human wants are the two major objectives of business.

Millard has defined it in the following words. " A process of dividing the work into convenient tasks or reduce of grouping each duties in the form of parts of delegating authority to each post and appointing staff to be responsible that the work carried out is planned."

Business organization is an act of grou[ing activities into effective co-operation to obtain the objectives of the business.


Following are the important principles which are related to organization :

1. Division of Work :-
Business activities must be devoted into several sections. It will make the work more easy for the businessman.

2. Right man for Right Job :-
This principle should be applied and each section should be given under supervision of qualified and efficient person. It will improve the performence of the section.

3. Flexibility :-
There should be flexibility in the structure of organization. In order to meet the changing circumstances we may be able to bring the changes in the organization.

4. Division of Responsibility :-
There should be clear division of responsibility. Each person and each section should be clear about his duty.

5. Co-Ordination :-
The organization must be arranged in such a way that it may coordinate all the departments or sections.

6. Balance in Various Sections :-
For the successful business there should be balance in various sections organization.

7. Specialization :-
It is also an important principle of organization. At each stage of production higher degree of specialization should be achieved.

8. Delegation :-
It is also basic principle of the organization. The scope of delegation of authority and responsibility must be clear to the workers.

9. Line of Authority :-
The process of business can be performed very well. If there is an unbroken line of authority from the highest level to the lowest.


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