Chapter 4 » Importance of Organization | Business Studies – XII

Importance of organization

1. Mechanism for management in action:- organization is not only a chart. It is a mechanism for management in action. So many management actions such as direction, motivation, coordination and control help ion organizing function. It also helps to manage the business firm with proper management actions

2. Facilitate in management and operation:- organization is directly or indirectly related to well defined work, authorities, responsibilities and account-abilities  Managers and other employees are benefited by appropriate functional activities. It helps in smooth and effective management operation giving effective functional activities.

3. Effective delegation:- all level of mgmt must make the decisions . Sufficient level of authority and responsibility must be delegated to make the decisions. When the delegation of authority and responsibility is affected all level of employees can make the decisions easy. Organization helps in effective delegation.

4. Growth and diversification:- organization clear division of work, delegation of authority and responsibility, the relationship among resources etc. these activities helps in growth and diversification function. On the other hand, sound org give the clear cut frame work to do work too

5. Optimum use of technological resources: org use machines, equipment and tools. With the help of org many sophisticated technologies and improved materials are used. Use of latest technologies help in efficiency improvement

6. Use of human resource:- human resource must be properly utilized. Org help in great utilization of manpower by placing right people and right place in the basis of their qualification, experience, skill and knowledge etc. Developing employees and motivating then are most important tools to use the human resources.

7. Flexibility:- org may be changed according to the needs of environment and changing circumstances. The org structure must be flexible that helps to adjust in external as well as internal environment.

8. Productivity increment: – when the authorities and responsibility are given to all employees they can make decision in their working level, appropriate adjustment of resources is most important management function which help to increase the productivity.

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