The organization is establishing relationships to identify, and group work to be done, define responsibility and authority, and enable people to work together most effectively in achieving goals.
An organization or organization is an entity, such as a company, an institution, or an association. It’s a comprising one or more people and having a particular purpose.
What is an Organization?
It is an organization where several people come together to do a job and work to get the job done. It is the organization of one or more people to come together and produce something. An organization is a group of people who work together, like a neighborhood association, a charity, a union, or a corporation.
The organization is a body of individuals working under a defined system of rules, assignments procedures, and relationships designed to achieve identifiable objectives and goals.
Planning an event by putting the pieces together. One or more people are coming together to organize an event. The organization covers all floors. An organization is not just a business or a business to make a profit. Organizing a birthday party, wedding, or a welcome party, these examples are all organizations.
Definition of Organization
The definition of an organization refers to the act of putting things into a logical order or the act of taking an efficient and orderly approach to tasks, or a group of people who have formally come together. When you clean up your desk and file all of your papers into logical spots, this is an example of organization.
The organization is establishing relationships to identify, and group work to be done, define responsibility and authority, and enable people to work together most effectively in achieving goals. The organization is a tool to achieve corporate goals. Each individual’s job is defined, and the authority and responsibility to carry it out are fixed.
The concept of groups of people acting together encompasses collective forms of action. Many actions that people do in cooperation, distribution of tasks, and cooperation are organizations.
Choosing an Organization Type
Organizations are a framework task that a firm can use to establish communication bridges and authority among its employees. However, a community or company needs to choose the type of organization that best suits their needs when creating an organization.
Size is an essential and decisive factor when deciding which type of organization to adopt. A small to medium business does not require a large and highly detailed organizational structure. On the other hand, larger companies need a more thoughtful organization to keep operations running smoothly. Such firms employ more staff; more staff require more managers. For such companies, a matrix organization is the most suitable option
2. Life Cycle
The life cycle of an event, a community, a company is one of the most important factors to consider when establishing an organization. Business owners seeking to grow and expand their operations should choose an organizational structure that is conducive to flexibility and seamless expansion. In an organization established for a limited time, it is not necessary to take into account the future and the possibility of growth for a single action.
3. Business Environment and External Environment
Another factor that comes into play when determining the type of organization is the external business environment. A dynamic business environment where competitors, suppliers, product types, and consumer needs are constantly changing requires a highly flexible and stable organizational structure. The greater the competition and change, the more the organizational structure should be designed accordingly.
Factors to Selecting a Form of Organization
- Entrepreneurial Ability
- Cost of Start-up
- Profits—to Share or Not to Share
- Risk Tolerance
- Continuity and Transferability
- Control vs. responsiveness
What is Organization Chart?
The organizational chart is mapping the entire structure, showing the hierarchical structure and chains of relationships within the strategic management. The organizational chart shows who works under whom, from top management to the bottom employee. Organization charts are schematic visual expressions that show the hierarchy in the business. In this hierarchical structure, the names, titles, photos, names, and departments of the employees and in-house relationship connections are placed on a table. While businesses are establishing their hierarchies, the organizational chart guides, these charts are critical to avoid hierarchical errors in the next processes.
Organizations can be vertical or horizontal. This situation may vary in connection with the management principles of the relevant enterprise.
Creating an Organization Chart
The formation process of the organizational chart requires serious work. Especially in newly established businesses, the employees’ authorities, duties, and working areas should be carefully analyzed. The importance of creating the organizational chart will affect all the processes of the business. Establishing a correct organizational structure and mapping is very important for the success and development of the organization. Businesses that successfully create an organizational chart act more planned and can focus on their business goals more organized.
Organization chart creation spans various fields, from strategic management to process management, from process management to performance management. It is a study that needs institutional system support at every step. Each level or position in the organizational chart should be created by distributing authority, duties, and responsibilities depending on the main departments.
In order to create an organizational chart, it is necessary to do extensive work on strategic management, process management, and performance management. Each level in the organizational charts, each position at these levels represents duties, responsibilities, and authorities, which are essentially shaped around business processes and corporate systems. Therefore, the levels in the organizational chart and the connection between them should be created by considering the communication networks.
The organizational chart should be created taking into account the company’s goals, tangible and intangible assets. According to the relationship between them, the Functional Organization Chart is created not according to the priorities given to managers, employees, or departments. A chart prepared without considering the bond between the departments, and the functions of the employees is not an organizational chart. This type of chart is nothing more than a directory of titles within the company.
An Organization Chart includes the following details and department names in general terms:
Administrative works: It provides the execution of internal services such as catering, maintenance, security, service, information-processing in the field of business management and production. In small-scale businesses, administrative affairs departments often carry out HR processes.
Financial Affairs: It is the department that provides the execution of business finance and accounting processes. It is the unit where receivables are collected; debts are paid, relations with official offices and banks are maintained.
Purchasing: It provides the raw materials and products necessary for the business. It works closely with the financial affairs department.
Production: It is the unit that works in the production of a product or service and aims to increase efficiency. It is one of the most important units together with the sales and marketing department.
Sales: It is the unit that provides services to domestic and international customers and manages dealer channels, and aims to increase the number of dealers.
Marketing: It is the unit that enables the product or service to be sold to gain brand value, conducts the market research necessary for its demand, measures the business and product performance, as well as manages the promotion and communication channels.
The organizational structure and job descriptions in the company should be known to all employees. Lack of knowledge in the organizational structure leads to hierarchy and communication problems. Confusion in job descriptions prevents the division of labor from being done correctly. In such a case, some work will be overlooked, and some will be repeated. For this purpose, various training or information meetings can be held, explaining the company’s organizational structure, especially for new employees in the company. Realizing the vision and mission of the companies is directly related to the organizational structure they have. The organizational structure is the type of organization that determines the distribution of duties, internal functioning, coordination, and chain of command.
The organizational structure shows the subordinate-superior relations of the people and departments in the hierarchy. On the other hand, it shows job descriptions. Therefore, the correct design of the organizational structure is a critical factor in the company’s success.
The organizational structure includes the job descriptions of the individuals as well as the job functions of the departments. The job description should provide a balanced distribution of all the work done in an organization. Daily tasks and routines should be evenly distributed among the employees of the enterprise. In terms of functionality, it is prevented that the work is piled up in a certain department or that some people are overloaded.
Centralized vs. Decentralized Organizational Structures
An organizational structure is either centralized or decentralized. Traditionally, organizations have been structured with centralized leadership and a defined chain of command. In this type of organization, the hierarchy is more apparent than in horizontal organizations. For example, the military is an organization famous for its highly centralized structure, with a long and specific hierarchy of superiors and subordinates.
Fair & Exhibitions: It is an event where many domestic or foreign companies participate, and the target audience is directly contacted.
Company Organization: These are the organizations organized to bring together, introduce, and motivate employees in the same institution or project. Company dinners, sports competitions, games, and activities are examples of these.
Meeting: It is the event that the company’s works, products, activities are evaluated between managers and departments by meeting periodically. The meeting can only be between employees of one department. It can only be done between company executives. It is sometimes held in meetings attended by all company employees, but only certain people take the floor.
Farewell – Welcome events: Some companies organize welcome events for newcomers to the company, but this is rarer than farewell ceremonies. Especially corporate companies do not neglect to organize farewell ceremonies for managers who have worked for many years. A farewell ceremony to be held for a person who has worked in a company for many years develops a sense of belonging in other employees.
Seminar: These are events organized within the institution or between companies with the aim of sharing information. Consulting companies can give seminars, academics, and experts in their profession.
Conference: Science, art, literature, economy, politics, etc. A type of long, informative speech made by an expert in the field to inform the audience on any subject, such as
Panel: A controversial meeting held in which a group of speakers discusses a topic, usually of a scientific, social, or political nature, in front of an audience. They are informative organizations with predominant academic and scientific aspects organized between institutions.
Types of Organizational Structures
1- Non-Bureaucratic structure
There is no precise distribution of duties, departments, and different managers in organizations managed with a pre-bureaucratic structure. Generally, businesses or groups with fewer than ten employees fall into this category of organization. In this type of organization, the leader or the owner of the business gathers all the authorities. Other employees or members follow orders from him.
The bureaucratic structure is an ideal hierarchical structure for larger and complex structures. Organizations with well-defined roles and responsibilities. Bureaucratic structures have more than one management level. It is governed by strict procedures and regulations. Organizational charts exist for every department, so everyone knows what to do in any situation. Decisions are made through an organized process. Authority is in the top manager, and knowledge comes from top to bottom.
The most prominent feature of this model is that the execution of the functions in the enterprise is left to the managers with expertise and managerial skills. Each of the departments in the firm is managed by separate managers. The top managers of the business manage the department managers. It may consist of different departments depending on the type of business—for example, production, marketing, financing, purchasing, and accounting.
Divisional structure is the most widely applied organizational structure in the USA after functional structure. In this model, work is divided into segments. For example, marketing services, product types, regional, customer types. Departments can also be divided into different departments within themselves, sales, marketing, customer relations… etc.
Matrix structure requires the organization to be constructed on the basis of both function and product. This build uses more teams to get things done. This structure is widely used both by companies that are constantly launching new products and marketing campaigns,
Establishing teams that undertake certain tasks within the organization is a type of organization that operates in the form of assigning the responsibility of a job to those teams from start to finish. The team can be configured vertically or horizontally. For example, the “Whole foods market” chain, which is the largest natural food chain in the USA, is managed by ten self-managed teams. Large bureaucratic firms can benefit from the flexibility of team management. For example, Daimler Chrysler is a company that implements a team management strategy.
The network is a type of organization that has been used frequently in recent years. In the network system, managers spend most of their time running and controlling external relationships. For example, the number of suppliers of the Inditex group, which owns the Zara brand, is approximately 1800 in the world. Inditex employs hundreds of managers to supervise these suppliers and production processes. Inditex has built between production in Asian countries, retail and sales activities in Europe and the USA, and operates with this network organization system.
Virtual organization refers to online communication with consumers and suppliers in a digital environment. Thanks to the opportunities offered by e-commerce, we live in an age where e-commerce companies consisting of a few people can make large-scale trade through ways such as contract manufacturing, stock shipping, B2C trade. The cost of reaching niche products has been reduced, as stocks are not required, and online shelf space is unlimited. Now, besides the big brands with standardized product catalogs produced in large quantities, companies use the online market, sell niche products, and operate in niche areas.
The Importance of Adopting Proper Types of Organizations
- Better Communication
- Set Organizational Priorities
- Better Employee Performance
Organizational communication is the process of sending and receiving verbal or non-verbal messages within the organization. The communication in question is shaped according to the organizational structure. Individuals also exhibit their behaviors accordingly in the face of events; They learn what to do and what not to do.
- Organizational communication is concerned with the achievement of organizational goals.
- Organizational communication provides the necessary relations between the elements that make up the organization.
- Organizational communication is a system that tries to adapt to developments (socially and technologically).
- Organizational communication is a tool that allows the organization to be managed efficiently and effectively.
- Organizational communication is not one-way because the organization is located in a dynamic structure.
Elements Determining Organizational Structures
- Division of Labor and Degree of Specialization
- Authority and responsibility
- Degree of Formalization
- Number of Levels in the Organization
- Degree of Centralization
- Objectives and Nature of Activities
- Control Area
- Command Corps
Basic Features of Organization Management
a) Planning: An effective business plan is essential for a business. It affects all departments, including planning, production, purchasing, shipping, sales, and marketing. Planning that covers the entire organization is essential in order to avoid future confusion and ensure healthy process flows.
b) Arrangement: In an organization, work processes, work areas, working and break times, legal rights, social benefits, and payments should be extremely regular. The problem to be experienced in some of these conditions both affects the working order of the enterprise and may cause reluctance and unhappiness in the employees.
c) Personnel: in addition to issues such as the inadequacy of the employees in their work, lack of knowledge, their work in tasks that are not suitable for their personalities and skills lead to the failure of both them and the business. Failure brings with it unhappiness and conflict. It is extremely important for an enterprise to make the right personnel selection, identify the right candidates for the right job, and support them in the adaptation process.
d) Leadership: Managers or supervisors should set clear goals for team members. A leader must ensure that team members are working together towards a common goal. The unity of the team, the cooperation of the team members are extremely important.
e) Control: Superiors must be aware of what is happening around them. The hierarchy should be well defined for effective management. Managers should review the performance and progress of their subordinates and provide guidance as needed.
f) Time management: Effective time management helps employees do the right thing at the right time. Managing time effectively always brings profitability in the long run.
g) Motivation: Motivation connects employees to the business. Recognizing employees for their achievements and offering financial incentives such as bonuses enable them to work more efficiently.
Division of work: The organization deals with the entire task of the job. The total work of the enterprise is divided into activities and functions. Different people are given various activities for their effective achievement. This brings division of labor. A person cannot perform many functions, but specialization in different activities is necessary to increase his productivity. The organization helps in dividing the work into related activities.
- Coordination: Coordination of activities is as crucial as their division. It helps in the integration and harmonization of various activities. Coordination also avoids duplication and delays. In fact, the various functions in a business are interconnected, and the performance of one affects the other. The performance of all departments will be adversely affected unless they are all adequately coordinated.
b) Common goals: The entire organizational structure is a means to achieve business goals. The different objectives of the divisions lead to the achievement of key business objectives. The organizational structure should be built around common and clearly defined goals. This will help them perform correctly.
c) Common relationships: An organization creates a cooperative relationship among the various members of the group. One person cannot create an organization; it requires at least two or more people. An organization is a system that helps to establish a meaningful relationship between people. The relationship should be both vertical and horizontal between members of the various departments. The building should be designed to motivate people to do part of their work together.
d) Well-defined authority-responsibility relationships: A business consists of several positions arranged in a hierarchy with well-defined authority and responsibility. There is always a central authority where a chain of authority relationship extends throughout the organization. The hierarchy of positions defines the lines of communication and the order of relationships.
Examples Of aN International Organizations
- International Monetary Fund (IMF)
- World Trade Organization (WTO)
- Bank for International Settlements (BIS)
- European Central Bank (ECB)
- World Health Organization (WHO)
- International Labor Organization (ILO)
Examples Of Multinational Companies (organizations)
- Coca Cola
- General Motors
Examples Of Non-Profit Organizations
- The Y (YMCA of the USA)
- Goodwill Industries International
- National Geographic Society
- Smithsonian Institution