Organisation: Meaning, Steps and Importance with Questions

The compilation of these Organising Notes makes students exam preparation simpler and organised.

Introduction to Organisation and its Importance

Every successful event in your school or college is a team effort. However, it is interesting to note, how so many people succeed to work in harmony. Heard of the organising committee? You must have because this committee plays a defining role in the grand scheme of things. Let us learn the meaning and importance of organisation in a firm.

What is Organisation?


We now know that organisation is one of the major functions of management. In layman’s terms, one can look at organising as an activity to eliminate chaos and introduce a systematic functioning in the enterprise. But by organisation definition, the organisation helps in establishing authorities, dividing workloads, assigning responsibilities, grouping tasks, and allocating resources.

This is of utter importance because once the plans have been laid there is a need to allocate resources, divide tasks, workforce, ensure optimal utilisation of resources, etc. so that the objectives are fulfilled. Further, it facilitates the collective working of the various members of the enterprise in an ordered manner.

Also, organisation involves defining various roles that need to be filled by suitable employees and establishing relationships between these defined goals to eliminate ambiguities in performance. In turn, this group the activities clarifies the amount of power and authority in the hands of different employees and clarifies the responsibility for various activities within the enterprise.

In a nutshell, an organisation can be defined as a process that defines the resources as well as allocate them, coordinates human efforts, and integrates both in order to achieve the defined goals.

Steps in the Process of Organisation

Steps in the Process of Organisation

So we can broadly list the steps in the process of organisation as follows:

1. Identification and Division of work
The organisational work commences with an identification of the extent and the amount of work that needs to be done and dividing this into manageable activities. The idea behind this is to eliminate duplication and share the burden of work.

2. Departmentalisation
Now as the work has been redefined as a number of manageable activities, the next step is to group activities according to a predefined basis. This basis decided what activities are similar to each other. All similar activities are assigned to a particular department. All in all, a number of departments are defined that are concerned with their own set of activities.

3. Assignment of Duties
The next step involves the distribution of work among the employees in organisations. The responsibility of looking after the functioning of each department is given to an individual. Further, jobs are allocated to employees.

It is important to realize that this assignment of jobs should be done in such a manner that the employees most suited for a particular type of job ultimately perform it. This ensures, a proper match between the ability and the type of job of the employee and subsequently effective overall performance.

4. Establishing Reporting Relationships
The final step is concerned with erecting a hierarchical structure and effecting communication among the diverse departments. This is done by establishing relationships. Effectively this means that every employee should be made aware of whom he has to take orders from and prove his accountability.

Establishing Reporting Relationships

Importance of Organisation

Organisation brings adaptability to the table for any enterprise. It helps in a smooth transition in accordance with the dynamic business environment. To point out, this is achieved by facilitating growth and survival. The importance of organisation is highlighted as follows;

Benefits of Specialisation
Organisation assigns work in a systematic manner to the diverse employees within an organisation. It ensures that suitable work is handed out repetitively to an employee who is a good performer in his field. An employee working regularly in a specific area gains invaluable experience in the long run. Consequently, this leads to specialisation.

The clarity in Working Relationships
As discussed before, organisation induces accountability by defining relationships among the employees within an enterprise. This is done by defining whom an employee is accountable to. In effect, it provides an ordered flow of information and instructions. Furthermore, this also helps in clarification of the extent of authority, responsibility and provides for a hierarchy.

Optimum Utilisation of Resources
Organisation helps in optimum utilisation of financial and human resources. It not only aids in the proper assignment of jobs to suitable employees but also keeps track that there is no waste of resources and efforts due to duplication of work.

Effective Administration & Governance
Another important feature of organising is that it ensures that the jobs are clearly defined within an enterprise such that there is no duplication and wastage. Coupled with, facilitating the clarification of work relationships, it promises effective administration.

Development of Personnel
Assignment of jobs to suitable personnel is an important step for the organisation. This delegation of jobs helps in the induction of creativity in managers. This happens because, with the help of delegation, a manager not only looks to reduce the workload but also discovers new ways of getting the tasks done.

Further, this gives them the tie to explore areas for the growth of the company. From the employee’s perspective, it generates experience and prepares him to face new challenges which effectively helps him to realise his full potential.

Growth and Expansion
Organization ensures that the enterprise undertakes new challenges. As a result, the company grows and diversifies.


Organisation allows a firm to adapt to change. True or false?
This statement is True. As an organisational structure is built in an enterprise, it equips the enterprise with adaptability. This is because, with changes in the dynamic environment, organisation provides for redefining of roles and revision of inter-relationships. As can be seen, it provides stability to the enterprise, so that it can continue to grow and survive in spite of the changes.