Topic 4 Organization and effective management
Goals: This topic considers the object of management - the organization. After studying the topic you can:
• to define the organization as an object of management;
• classify organizations according to various criteria;
• select and analyze internal organization variables.
Lecture’ plan
The concept of organization as a field of activity manager. Classification of organizations. A systematic approach to the definition of the organization.
General features of organizations.
The internal environment of the organization.
The external environment of the organization
1. The concept of organization as a field of activity manager. Classification of organizations. A systematic approach to the definition of the organization.
An organization is an economic unit that has defined boundaries and functions to achieve a goal or set of goals shared by the member countries. The main function of the organization is to transform the available resources with the help of various technologies into the required end results.
There are formal and informal organizations. Formal ones are those organizations that were created by the will of the people, by prior arrangement. Formal organizations are headed by leaders (appointed or elected). Informal organizations arise spontaneously when people engage in regular interaction with each other to achieve certain goals.
Organizations can be classified by a number of attributes:
- according to the objectives of the organization are divided into commercial and non-profit;
- by the nature of the activities of the organization can be public and economic;
- by organizational and legal forms of activity, joint-stock companies, partnerships, production cooperatives, etc.
- depending on the form of ownership, enterprises of state, municipal, private ownership are distinguished;
- by industry sector - industrial, transport, agricultural, trade organizations are distinguished.
A modern organization is a complex system that cannot be considered as the sum of its component parts. A complex system is an isolated set of interrelated elements, which has new qualities that are absent from its constituent elements. When analyzing a complex system, it is necessary to study it as a whole, in the totality of connections.
Complex systems are characterized by the following most important features:
- the presence of a single purpose of functioning;
- the presence of several levels of management, hierarchically related;
- the presence of subsystems, each of which has the purpose of functioning, subordinate to the common goal of the functioning of the whole system;
- resistant to external factors.
Depending on the nature of the elements in the organization (in the enterprise), the following subsystems can be distinguished (Fig. 5).
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Figure 5 Enterprise Subsystems
General features of organizations.
All organizations differ from each other in different aspects, however, at the same time, it is possible to identify characteristics common to all organizations (Fig. 6).
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Figure 6 General characteristics of the organization Resources. Organizations use various resources to achieve their goals; they are summarized in Figure 7. The organization’s main task in the use of resources is to achieve goals with minimum costs and maximum efficiency.
Figure 7. Resources of organization
Dependence on the external environment. One of the most important features of an organization is its relationship with the external environment, from where it replenishes its resources and where it sells the goods produced or provides services.
The external environment in relation to the organization is a set of interrelated factors that influence everything that happens within the organization. These are economic conditions, and consumers, and competing organizations, and technology, and many other factors. The external environment is beyond the reach of the organization’s management, but the organization is totally dependent on the external environment.
The division of labor is a qualitative distinction and isolation of its various types, assigned to those entities that can carry them out most successfully. The division of labor is the basis of the specialization of activity, i.e. performance by employees of certain types of work, operations and procedures.
The horizontal division of labor is the distribution of work on a professional basis between the participants of the labor process, this is the division of all work into its components. Horizontally, labor is subdivided, as a rule, according to functional, commodity-industry and qualification characteristics.
The vertical division of labor exists between managers and executors; it is the separation of the work of coordinating actions from the actions themselves. The vertical division of labor forms a hierarchy, i.e. subordination of some parts of the organization to others.
In the enlarged plan, the vertical division of labor is carried out in the following areas:
- general leadership;
- technological leadership;
- economic management;
- operational management;
- personnel management.
The presence of units. In very small organizations, the horizontal division of labor is not traced: different types of work can be performed alternately by a few staff of an enterprise. In complex organizations, with the help of a horizontal division of labor, divisions are created, which are assigned only to their inherent tasks and which achieve only their inherent goals. They are named after departments or services.
The necessity in management. The management system is the most important characteristic of the organization. It assumes the existence and functioning of managers, channels for the transmission of information and activities for the preparation and adoption of management decisions.