Following are the advantages of a sound organisation structure: 1. The importance of sound and ideal organizational structure can be studied under the following heads:-, 1. Different jobs and positions are interrelated by structural relationship. 6. It helps equitable distribution of work. Organisational structure encourages prompt decision-making and effective control through decentralization. Terms of Service 7. Entire organisation environment and climate is favourable for productivity and job satisfaction. A disorganised inventory system is one of the quickest ways … Facilitates Growth of Enterprise 10. Another management expert Kenneth C. Towe states that—”A sound form of organisation is the answer to every business problem, that a poor organisation could run a good product into the ground and that a good organisation with a poor product could run a good product out of the market”. To avoid this, block out your time. Facilitates Growth and Diversification: Sound organisation helps in keeping activities under constant vigil and control. A business may have personnel, resources and energy, but if it doesn't have a clear and compelling vision of where it is headed, it is bound to flounder. Democratic and participative leadership offers satisfaction of higher level wants of employees. Julie Bestry, certified professional organizer and president of Best Results Organizing, says from her experience, people often make the mistake of thinking about organization in terms of how things look. Incompetent individuals are overused while talented people are under-utilized. A good organisation helps in encouraging people to try new ideas. There will be a need for employing more persons whenever expansion and diversification takes place. 18. Clear authority relationships and proper assignment of work facilitate the task of achieving coordination at all levels. Anything you use at least every day should be within easy reach. Develop Long Term Goals. Human, technical and material resources are put to good use. It gives proper recognition to the contribution of each individual, values their co-operation hence gaining their sincerity and loyalty. You can't expect to overturn years of bad organizational habits in a day. Such systematic structures lead to better coordination among the teams and departments therefore helping in the overall development of organization and its goals. A clearly defined work, authority, responsibility, accountability will enable individuals to work in a free atmosphere. 11. It automatically motivates the employees who are working in an organisation and increases the efficiency of management. By providing training and practice on different jobs, and in different capacities, efficient organisation offers excellent scope to its employees for development. These training institutes are collecting data directly from the field used in the training. Too much irrelevant content often results in information silos. But without a proper system in place, they can be a great source of problems, particularly legal issues. If businesses fail to keep up with these constantly-moving targets, they lag behind, become stale and, ultimately, fail. The adjustment to new changes will require re-scheduling and re-adjustment of duties and responsibilities in the organisation. Inadequate and unscientific organisation may result in duplication of work and efforts and some of the important operations may be left out. We asked two professional organizers why organization is so important for small businesses and how they can stay organized for the long haul. If an organisation is ill-designed and reveals a number of deficiencies, management is rendered difficult and ineffective. Delegation of authority is also an important means of directing the sub-ordinates. These money transactions are necessary to keep a business going. Changes in the organisation may result in the appointment of additional staff members, de-centralisation of authority and responsibility, raising of additional capital, identification of the consumer’s satisfaction and preferences, expansion of sales promotion activities and the like. It Provides for the Optimum Use of Technological Innovations: A sound and ideal organizational structure is not rigid but it is flexible to give adequate scope for the improvements in technology. "After returning from a networking event, note how you met each contact, determine how to get the data into your CRM, and determine how to best serve those new relationships," Norris says. A sound organisation by providing for training of staff at different levels and by proper delegation and decentralization helps development of managers. It provides for the optimum use of technological improvement, e.g., automation and computerisation. Confusion, delay and duplication of work are avoided in good organisation. This helps in the better use of individuals working in the enterprise. It is the backbone of a management and without it; no management can manage the various operations of an enterprise. Organisation structure provides the formal channel of communication which is necessary for smooth functioning of the organisation. Why is organization important? 16. 10. A well devised organisational system will provide a sufficient opportunity for the training of new trainees and development of existing staff. Necessary functions are determined and assigned so that personnel and physical facilities are utilized effectively. With the growing concepts and complexities of large scale business, the need and importance of organisation has grown substantially. Good organisation removes red-tapism and corruption, prevents duplications of work, makes communication easier, and provides a sound basis for workers participation in the management. You can't expect to overturn years of bad organizational habits in a day. Instead of a single chief executive in a large company, Peter Drucker would prefer a team with a captain who is more than one among equals and each member of the top management team has assigned areas in which he makes formal decisions and for which he is responsible. Permits Optimum Use of Resources 7. Efficient organisation, thus, avoids all misunderstanding, confusions, conflicts, duplications and gaps. Why Is Organizational Development Important to Businesses? Delegation of authority creates superior-subordinate relationship between various positions in the organisation. There are different types of organization, according to the Skills and Practices in Organizational Management website. It is the basis for necessary team work among the various members of a common enterprise and helps in coordinating their efforts. Besides, the administration classifies the activities of the business department-wise and appoints the officers, assistants, supervisors, executives to facilitate the achievement of objectives. 13. Sound organisation (as a foundation for management process) can provide following typical results: i. "In other words: function beats form!". A sound organisational structure facilitates the optimum use of technological improvements such as automatic techniques of production, control devices, computer system etc. The growth of business means an increase in the scale of operation and diversification means starting of production of a new type of products. 9. (3) It Ensures Optimum Use of Human Resources: Organisation affects human resources in a number of ways such as recruitment, training, placement of workers, bringing harmony in their efforts, improving the communication network and motivating them to improve their efficiency. The actual work is completed at lower level of the organisation. This helps to check out that all necessary expenses are met, including taxations t… An organisation provides sound foundation for effective managerial control. Thus, a sound organisation structure is the soul of the enterprise. A business organization needs a strong financial team to handle the cash flow of the company, with existing records as a testament to the different transactions. 3. 3. Moreover, they can then use that understanding to identify employees who exhibit leadership and other key behaviors. resourcefulness, independent thinking, initiative, spirit of innovating etc. Sound organisation helps in keeping the various activities under control and increase the capacity of the enterprise to undertake more activities. There are a number of benefits and reasons for having an organizational chart. iii. The functions like co-ordination and control require a proper division of various functions and their assignment to suitable persons. Effective management implies managerial adaptability to changing situations within the dynamic framework of an organisational structure. job rotation, job enlargement, delegation, etc. vii. Lack of organizational leadership can nullify even the soundest of organizations. 7. Sound organisation often effective management of change continuously and gives premium to innovations. It enables smooth management and operation of the enterprise, thereby enhancing managerial efficiency, e.g. The bottom line is a company’s net income after all expenses have been paid out of its earnings. Organizational charts prove to be of great importance for business plans, grant applications, it works as a handbook and is also a crucial office document. Good organizational skills naturally feed productivity, enabling small business owners to cross off more items from their to-do lists. In an environment in which an organisation is dynamic and constantly changing to cope with ever changing situations, it is very important to encourage the employees to take proper initiative. Vicki Norris, president of professional organizing services company Restoring Order, says, "Disorganized individuals take longer to complete work." 2. It ensures that every individual is placed on the job for which is best suited. All these factors assure stability. Stimulates Creativity. It is a combination of many factors, such as management style, management values, the formal organisation (rules, policies, procedures, practices, organisational structure, reward system) informal organisation (norms of behaviour beliefs, values and attitude of the group) the communication system and all other managerial systems. Following are some of the advantages of a good organisation: 1. Uploader Agreement. With the growing concepts and complexities of large scale business, the need and importance of organisation has grown substantially. Save money by comparing insurance quotes from multiple carriers, Organization 101: Why organizing your business matters. It Prevents the Growth of Laggards, Wirepullers, Intriguers or other Forms of Corrupters: As a matter of fact, experience shows that corruption can only thrive in those enterprises which have failed to set up a sound organisational structure. Another critical and versatile advantage of finance is developing long … While this can be true, OD works to improve organizations in a more systematic way, organization-wide, as Beckhard put it. xiv. Right man, right time and the right job can also be applied to them. This will bring an automatic co-ordination in the business. Better Relationships – A sound organisation helps in building better relationship amongst its personnel, department, sections etc. (5) It Encourages Human Use of Human Resources: A sound organisation provides for job rotation and job enlargement and makes job meaningful and interesting. Marketing copy and proposals play a huge role in the sales … The organisation should be flexible to incorporate all new requirements. With the passage of time, however, even a good organisation may be transformed into a bad one unless continual adjustments are made with the varying circumstances. Loose contact files and business cards are missed leads and lost revenue if information isn't managed and queued. Sound organisation facilitates precise and effective delegation. 9. Sound organisation has flexibility and also stability. Ensure growth – A well-defined organisation structure will help an enterprise to grow and expand its operations. It specifies the channel and mode of communication among different members. Unsound organisation becomes the breeding ground of dishonesty, whether in matters of effort or of money. A flexible organisational structure is needed to adopt a new technology. A manager leads, co-ordinates and controls the enterprise activities through the organisation. Organisation is one of the basic functions of management. It is the foundation upon which the whole structure is built; which contribute to the success and survival of the enterprise. A sound organisation structure encourages better relations between the worker and the management, and increases employee satisfaction and decreases employee turnover. “A well-defined and sound organisation makes sure that there is proper co-ordination between all the activities. All these factors assure stability to the enterprises. A sound organization structure facilitates effective operation of the enterprise. A good organisation helps in proper assignment of jobs, gives due credit to all the employees, reduces conflicts, chaos and duplication of work. In other words, the value of each individual’s contribution is enhanced and at the same time the accomplishments of the group are increased. Prohibited Content 3. The effectiveness of an enterprise is measured by the reaction of staff members to the adopting of a new technology. Various managerial functions will be effectively performed with the help of an organisation. Getting organized can help: But don't just take our word for it. It develops cohesiveness in the enterprise. It ensures steady growth and diversification. quick disposal, minimum inter- department rivalry or friction, absence of divided responsibility, effective communication etc. This will give job satisfaction to employees. It provides for the optimum use of technological improvement, e.g. This is done by dividing the activities in such a way that they become complimentary to each other.”. Complete Insureon's online application and contact one of our licensed insurance professionals to obtain advice for your specific business insurance needs. The importance of sound organisational structure can hardly be over emphasized. A sound organisation utilizes the human and other resource of the organisation properly. Well-Designed and balanced organisation facilitates management and operation of the organisation activities through exercise... It must be divided among its staff in a year, so can. 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