Organization: An organization is social entity that
has a collective goal and is linked to an external environment. The word is
derived from the Greek word organon, itself derived from the
better-known word ergon which means "organ" – a
compartment for a particular task. All organizations have a
management structure that determines relationships between the different
activities and members, and subdivides and assigns roles, responsibilities,
and authority to
carry out different tasks.
Organizations are open systems--they
affect and are affected by their environment.
Management is essential for any organization:
(1) Achieving
Company Targets: When a company begins its operations, specific
goals are setup which can only be achieved if all the parts of the organization
function together and efficiently. Proper management makes sure that each part
of the company works towards achieving a common goal without disarray.
Management actually plans, executes and balances the resources of a company in
such a way that there is maximum work output to attain the goals of
organization swiftly, while retaining work quality. In absence of proper
management, different sections go on to attain individual targets. However,
common goal may not be achieved, which would further lead to delays, losses and
low quality output.
(2) Reduction in Wastage: When resources of a company are effectively
managed, wastage is reduced, thereby lowering overall costs and attaining the
state of ‘resource optimization’. This means that company is making profits not
only from output, but also from better and optimum use of input. Proper
utilization of resources and reduced wastage prevents both under employment and
exploitation of resources. Management can identify resources which are scarce
and find alternatives for the same, thus reducing the cost again. It also
employs the specialization of employment and leads to increased productivity
and quality output.
(3) Simplifies the Organizational Structure:
Management controls effective work division, specialization and resource
allocation. This creates a uniform flow of work and specifies boundaries of
responsibilities, authority and rights, which do not overlap. This structure is
necessary, as it clarifies to each employee his position and field of influence
in the organization. In such a scenario, every employee would know his/her
basic rights, duties, immediate superiors and subordinates, along with the
knowledge of opportunities awaiting him, as his relation with the company
grows. Effective management also helps to ascertain that no two people are
doing the same work and that right person is allocated for the right job, thus
increasing productivity
(4) Increases Stability: The Company should be maintained in such a fashion
that external market turbulences do not hamper the company’s functioning. This
requires effective changes that need to be made in the company, without hurting
the company’s stand or its workers too much. Without proper management this
will not be possible. Management will provide increased stability and
adaptability to the company, helping it survive market conditions and grow with
time. Also, the workers would not be apprehensive about losing their job, which
would, in turn, help them work with peace of mind.
(5) Provides the “Feel Good
Factor”: According
to Harold Koontz, ‘‘Management is an art of getting things done through and
with people in formally organized groups”. This statement ascertains the
importance of people in the whole scenario. It is extremely important to keep
the workers happy for the successful functioning of the company. A company
which is managed with efficacy prospers rapidly and, in turn, produces better
revenue, thereby opening avenues of growth for the workers involved. The upward
climb in the growth chart assures the workforce of not just better salaries,
but better positions, which provides motivation for better work.
Proper management helps to build efficient
organizational structure, set targets that are testing yet achievable and
optimize resource utilization (both human and otherwise).
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