Human Resource Management unit 4

7/30/2019 Human Resource Management unit 4

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accomplishment of some common purpose or proposes' - Haney.

8. 'Organisation is a structural framework within which various efforts are co-ordinated and related to each other' - Theo Haimann.

9. 'Organisation is a process of welding together a framework of prositions which canbe used as a managemant for the most effective pursuits of the goals of an enterprise' - James Lundy.

10. 'Organisation is the process of combing the work which individuals or group have to perfrom with facilities necessary for its execution, that the duties so oerfromed provide the best channels for the efficient, systamatic, positive and co-ordinated application of the available efforts' - Olive Sheldon.

The above definitions make it clear that organisation concerned with grouping of activities, establishing authority - responsibility relationships between them andcreating accountability of the enterprise goal.

Process Of OrganisationThe process or act of organisation involves the following stages :

1. Division of Work -- The entire work of the business enterprise is divided into anumber of activities for better perfromance and control. In a manufacturing concern,the variour activities may be divided into certain categorie - production, finance,personnal and marketing. In a trading concern, the activities may be divided intopurchase, storage, display, accounting, sales, advertising etc.

2. Grouping of Activities -- As the second step, activites, which are similar in natureand also closely related, will be put under the control of a department. For example, window display, advertising, management of sales staff, sales promotion etc., are theactivities to be grouped and brought under the control of the marketing department.Similarly management of working capital, provision of marking purchases, buyingmachinery etc., are the activities perfromed by the finance department.

3. Assignment of Work -- After the activities have been grouped into departments,the next step is to assign work to every andividual who is employed in a particulurdepartment. Foe example, in the finance department, an individual assign the workof receiving cash, another person may be making disbrusement so on. Likewise, inthe marking department, a salesman may be made in charge of one region, anothersalesman may look after sales in another region and so on.

4. Delegation of Authority -- An employee who as assigned some work, need to begiven certain authority to carry out the responsibility. Transfer of authority by asuperior to a subordinate is what is known as delegation of authority. For example, asalesman who as been asked to look after sales in a particular region needs to be


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given the necessary funds to go over to such a place, stay there and meet thecostomers in that place. He needs funds for travelling, stay,food and so on.Withoutthe authority to draw the necessary amount, the salesman will not be able to do this work.

5. Creation of Accountability -- A subordinate to whom the authority has beendelegated must be made accountability to his superior for the use of authority andfor the work done. Only by creating accountability, the superior can ensure that thesubordinate has fullfilled the task assinged to him and has not misused theauthority.

6. Defining Relationships -- It means that every subordinate should know who issuperior and in the same manner every superior must know the subordinates underthem. Every subordinate must carryout the task assinged to him by his superior only and he is accountable to that superior alone.

Importance of Organisation

The benefits or advantages or the importance of organisation may be explained asfollows :

1. Vital for Implementing Plans -- Organisation follows planning, implementationof the business plans cannot be posible without the aid of organisation. It is only athrough organisation, the resources requried, to accomplish the enterprise goal, areacquried. Organisation assings the work to the superior and thesubordinates.Accomplishment of the task by the individuals and departments shouldresults in realisation of the business goal.

2. Specialisation -- the entire work of a manufacturing concern is divided intoproduction, finance, personnal and marketing according to importance. A separatedepartment is created to look after each of these. This result is specialisation.

3. Optimum use of resources -- Organisation gives utmost importance to theoptimum utilisation of the enterprise resources, namely, men, machines, materialsand money. Right men are recurited for the right job. All efforts are made to ensurethat there is no overlapping of activities and duplication of work. Materials are keepat the right place and made available at the right time. Tools and equripment areproperly maintained and put to the best possible use.

4. Teamwork -- The work that is done in an organisation is teamwork. The work of each individuals is determined by the work done by others. In other words, a series of opration will have to be carried out to complete the task. A number of persons will beperfroming these operation. It is, therefore, necessary for them to workas a team and with proper understanding.

5. Communication Realationship -- It is not possiblr for an individualsin an


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organisation to do his work without getting orders, instructions and advise fromothers. For example, a subordinate has to work as per the instructions given to himby his superior. Once the work has completed, he has to report to his syperior. If thesubordinate needs any clarification, he can either ask his superior or anothersubordinate. Thus, it becomes clear that organisation encourages communicationrelationship between the individuals.

6. Creativity -- An organisation provides ample scope for the individuals to exhibitstheir creative skills. As authority is delegated to every subordinates, he has thefreedom to act. He can use all his innovatives ideas in perfroming the task. He willalso be suitably rewared for the initiative he has made. Such a reward may be in theform of incentives, greaterdecision-making authority and so on.

7. Co-ordination -- The activities perfromed by different departments areinterrelated and also interdepented. For example, production is a deepartments onthe availability of finance. Marketing is dependent on productions. It is, therefore,important that a proper link is established between the activities of differentdepartments. Surh a link is what is called co-ordination.

8. Continuity -- Men may come and go;machines may be replaced; materials may bepurchased whenever necessary -- all these activities go on in an organisation on acontinuous basis. Organisation ensures that there is no disruption of work due to thenon availability of men, machines, materials and money.

Organisation Structure

An organisation structure explains the positions and official relationship betweenthe vartions individuals working in an organisation. It helps to understand an

organisation better. It provides answers t the following questions:

Who is the top-most official in an organisation ?

Who are the departments heads ? What are their functions ?

Who are the subordinates atsff in each departments ? Etc.

Organisation Chart

Diagrammatic presentation of the orgnaisation structure is what is known as an'Organisation Chart'. It may show the names, designations and functions of the personnalin an organisation. A specimen of organisation chart is given below:


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General Manager

Production manager personal manager

Foreman 1 foreman 2 personal officer personnel officer(recruitment & training) (records)

Worker 1 worker 2 Worker 1 worker 2 assistant 1 assistant 2 assistant 1 assistant 2

Figure 4,1 - Organisation Chart

Merits of an Organisation Chart

The merits of an organisation chart may be started as follows :

1. It shows the official positions of each individual in an organisation.

2. From the organisation chart, it is possible to make out who are the superiors and

subordinates.

3. It gives identity to the personnel in an establishment.

4. It helps am outsider to understand the different desingnation in an organisation.

Drawbacks of an Organisation Chart


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The limitations or drawbacks of an organisation chart are given below :

1. An organisation chart can only show the formal or official relationships in aorganisation. It cannot depict the informal or personal relationship between

the individuals.

2. It may, sometimes, promote ill-feelings among the personnel in an organisation. An individual, who has been indicated in the chart as a subordinate,

may not be able to take it in the true spirit.

3. Often, the organisation chart is not updated in accordance with the changes inpositions taking place in the organisation from time to time.

Priniciples of Organisation

A sound organisation structure should adhere to the following priniciples :

1. Objective : The various activities perfromed in an organisation should help to

attain the goal of the enterprise . The goal of each individual anddepartement must synchronise with that of the concern.

2. Division of work : The total work of the enterprise should be divided intoidentifiable function like production, purchases, marketing, finance etc., for

better performance and control. This leads to specialisation.

3. Authority and Responsibility : Authority is the official right of an manager.Responsibility is the duty of a subordinate, to whom some work has been

assigned, to report to the superior on the work done.

4. Delegation : It means transfer of authority by a superior to his subordinate. A subordinate to whom some work has been given must also be given the

necessary authority to carry out the task. Delegation results in a vertical flow of authority from the top level to the lower level of the organisation structure.

5. Balance : Authority and responsibility must always bre equal. If responsibility exceeds authority, the subordinates will not be able to perform the task. On

the other hand, if authority exceeds responsibility, there will be misuse of authority.

6. Responsibility is Absolute : Responsibility is never delegated. For the perfromanceof his subordinates, a superior is accountable to his own

superior.

7. Unity of Command : It means that a subordinate should get orders from onesuperior only and is accountable to him alone. Dual subordination results

in confusion and leads to indispline.


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8. Unity of Direction : It means that each group of activities having the same objectivemust have only one head and one plan.

9. Simplicity : The organisation structure must not be a complicated one. It shouldhave only few levels of authority so that there is free flow of

communucation between persons.

10. Flexibilty : The organisation structure should not be rigid. It should be capable of

being adjusted accourding to the requried changes in future.

Formal and Informal Organisation

'Formal organisation' is deliberately and consciously created for theaccomplishment of the enterprise objectives. It provides for official relationshipsbetween the individuals. The communication channel in a formal organisation is alsoformal or official.

'Informal organisation', on the other hand, is the outcome of personal and

social relationship between the individuals in an organisation. It is not consciously or deliberately created. it develops spontanously as a result of interactions betweenpersons. Friendship, identical tastes and preferencees, language affinity, personaladmiration etc., are some of the factors that leads to the formation of an informalorganisation.In fact, the sales manager also may not take it seriously and that is whatinformal organisation is all about.

Merits of Informal Organisation

The merits of informal organisation are given below :

1. It facilitates better communication relationships between the members of anorganisation.

2. It helps to fulfil the social needs of the personnel in an organisation.

3. It offers greater scope for co-operation in the work place.

4. The informal atmosphere in the work place will motivate the staff better.

5. The scope for conflicts may also become less in view of better personalrelationships between the staff.

Demerits of Informal Organisation

Informal organisation suffers from the following drawbacks :

1. It reduse the importance of herarchy, i.e., line of authority.


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2. It is possible for anyone to establish contact with anyone else in informalorganisation. This may affect the work atmosphere.

3. Superior may lose their inportance.

4. Informal organisation promotes informal communication and as a result rumoursmay spread.

5. The employees may adope a casual approach to work in an informal atmosphere.This may affect the quality of work.

.

Merits of Informal Organisation

The merits of informal organisation are given below :

1. It facilitates better communication relationships between the members of anorganisation.

2. It helps to fulfil the social needs of the personnel in an organisation.

3. It offers greater scope for co-operation in the work place.

4. The informal atmosphere in the work place will motivate the staff better.

5. The scope for conflicts may also become less in view of better personalrelationships between the staff.

Demerits of Informal Organisation

Informal organisation suffers from the following drawbacks :

1. It reduse the importance of herarchy, i.e., line of authority.

2. It is possible for anyone to establish contact with anyone else in informalorganisation. This may affect the work atmosphere.

3. Superior may lose their inportance.

4. Informal organisation promotes informal communication and as a result rumoursmay spread.

5. The employees may adope a casual approach to work in an informal atmosphere.This may affect the quality of work.


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Distinction between Formal and Informal Organisations

The points of distinction between formal and informal organisation have beentabulated below :

Formal Organisation informal organisation

1. It is consciously and deliberately created. 1. It arise spontaneously.

2. Authority and responsibility are vital for its functioning. 2. It is only personal factors such asfriendship, affinity, trust

and confidence that are important.

3. Rules and procedures are important. 3. Personal relationship between individuals ismore important.

4. It can be shown on the organisation chart. 4. It cannot be shown.

5. Authority flows downwards and responsibility flows upwards. 5. There is no flow of authority andresponsibility.

6. It is deliberately created only to attain the enterprise objectives. 6. It is created to fulfil the social needs of an individual. However, it

may also contribute to the enterprise goal.

7. Designation and official positions are very important. 7. Designation and official positions arenot important.

8. It is permanent and stable. 8. It is unstable.

Theories of Organisation

Many theories have been developed to explain the structure, functioning and

performance of organisation and also the behaviour of individuals and groups within an organisation. The important theories are givenbelow:

(i) Classical Theory

(ii) Neo-Classical Theory

(iii) Modern Theory

Each of these has been explained below:Classical Theory

The classical theory has been developed by F.W.Taylor , Henri Fayol, Mooney Reiley and others. The theory explains the concept

organisation through the following elements:


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(i) Division of labour,

(ii) Scalar and functional processes,

(iii) Structure, and

(iv) Span of control.

Division Theory

It is concerned with dividing the total work into a number of processes, each of which will be performed by different individuals. Thebenefit of division of labour is that it promotes specialisation. It also leads to asubstantial increase in output without the need for additionalcapital.

Scalar and Functional Processes

The scalar principle explains the superior-subordinate relationship in theorganisational hierarchy. The superior at the top communication his dicisions to hisimmediate subordinate, who is in turn communicates the the same to hissubordinate and so on.

.The functional process is concerned with the division of the organisational

activities and grouping the same on the basis of similarity and compatibility,e.g., production, sales,finance, personnel etc.

Structure The ofganisation structure is one which is deliberately and consiously created

for the sake of attaiining the organisational objectives.It is concerned with the positions and designations of the personnel in an

organisation and the tasks they are expected to carry out. Thediagrammatic presentation of the structure is what is known as the oragnisation

chart. The organisation structure ensures specialisationand effective co-ordination.

Span of Control

The span of control is also known by certain other names like span of supervision, span of manqement and so on. It actually refersto the number of subordinates a managerr can effectively manage. There aredivergent views on the number of subordinates a manager canmanage. If the manager is asked to supervise the work of too many subofdinates, hecannot do his work effectively. On the other hand, if thenumber is too low, the manager's potentials cannot be fully utilised. Hence, the need


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for determining the correct span.

The classical theory explains only a formal organisational set up. It fails toexplain the role played by informal groups within a fomalorganisation, personality differences etc.

Neo-Classical Theory

This theory is also known as the "Behavioural Theory of Organisation". Thistheory is identified with the human relations movementstarted by Elton Mayo and his associates. The neo-classical approach has adopted

the basic patterns of the classical theory but it has modifiedthe same in the light of the behavioural patterns of the people in the organisation.

Division of work, no doubt, has several advantages. But it may causemonotony and fatigue as the worker is doing the same workagain and again. The neo-classical theory, therefore, has accepted the concept of

division of labour but has stressed the need for motivation,

co-ordination and proper leadership to get rid of the negative aspects.The principle of scalar and functional processes has been modified with an

added emphasis on delegation of authority and creationof accountability.

As far as the principle of structure is concerned, the neo-classical theory hasmade an emphasis on the concflicts that may arise

between people in an organisation who are performaing different functions. Thetussle between the line executives and the staff executives

has been shown as an example. To overcome such problems, the neo-classicaltheory has suggested participation, effective communitcation

and recognition of human dignity.

In the matter of span of control, the neo-classical theory has not acceptedany superior - subordinates ratio. It has only said that in

determining the correct span, factors such as the type of subordinates, the nature of work to be supervised etc., must be taken into account.

Neo-classical theory is in favour of a flat organisations structure as againstthe tall structure put forth by the classical theory. A

flat structure has a shorter span of control and this provides greater scope foreffective communication and motivation.

Important aspects of neo-classical teory

The important aspects of the neo-classical theory may be summed up as follows:

1. An organisation is essentially a social system.


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2. There exists an informal organisation within a formal organisational set up.

3. Proper motivation and leadership will be necessary to break monotomy andfatigue.

4. There must be a proper system of delegation of authority and creation of accountability.

5. Conflicts between the personnel in an organisation can be resolved throughparticipation, effective communication and recognition

of human dignity.

6. Capabilities of the superiors and subordinates, the nature of the work to beperformed etc., shall be considered in determining the

correct span of control.

Limitations of Neo-classical Theory

The neo-classical theory too suffers from certain limitations. These are givenbelow:

1. It has been said that the structure of organisation provided by the neo-classicaltheory would not suit all organisations.

2. It has been further said that the assumption of the theory, that it is possible toevolve a solution that is acceptable to everyone

is not true.

Modern Organisation Theory

The modern theory studies organisation as a system. A system is an organisedbody of independent parts which are interrelated.The parts of a system are called sub-systems. The functioning of every sub-system is

vital for the successful functioning of the system as a whole. The various stages involved in studying organisation under the moderntheory are:

(i) Identifying the strategic parts,

(ii) Studying the nature of their mutual dependence,

(iii) Studying the processes in the system that link the parts together, and

(iv) Analysing the goals sought to be achieved by the system.

These have been explained below:


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Strategic Parts of the Organisation System and Their Mutual Dependence

The major part of the organisation system are :

1. Individual : The personality traits of an individual, his motives and attitudes aresomethings very important in determining what he wants to do for the

organisation.

2. Formal Organisation : It refers to the authority-responsibility relationships in anorganisation arising out of positions and designiations. It requries

every indiduals to perfrom the work assigned. The indidual, by perfroming hisduties, demands fulfilment of his expectation.

3. Informal Organisation : there are informal groups within the formal organisaion.Every indiduals belong to same informal group or the other. Such

as informal group requries the individual to conform to the behavioural patternlaid down by it.

4. Physical Setting : The physical environment in which the work is done is anotherimportant consideration. Steps mach be taken to design thephysical environment in tune with the physiological, social and psychological

characteristics of individuals.

The process of integration of various organisational parts

The various parts of the organisation system are interrelated. They are linkedor integrated by means of the following :

1. Role or Action : An individual perform a variaty of roles and acts in differentstyles depending on the position held by him in the organisation. Therole played by him as a manager of the formal group may tend on the different.

this may result in conflict sometimes. Therefore, it become necessary to evolve a method by which the individuals does his job well to satisfy both the

groups.

2. Communication : It is a important tool that linjs a various segments of theorganisation together. It is necessary for exchanging information among

the individuals in an organisation. Communication is also a vital for controllingand co-ordinating activities at varioue levels.

3. Decision- making : It is yet another important mechanism that links the varioueparts of an organisation. A decision is usually made after a proper

interaction between the organisational members. Thus, as a linking tool,decision-,making secures consensus, on any matter, among the individuals.

4. Balance : As a linking tool, balance refers to adapting the sub-systems to theneed of the system.


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Goals

It is difficult to come across an organisation without any specific goal. But it isdifficult to define in precise terms the overall organisational goal. Although eachindividual in an organisation perform his own line of activities, all such activitiesculminate in attaining the organisational goal.

Evaluation of the Modern Organisation Theory

The modern organisation theory studies the organisation as a whole. It is a marcolevel study. It is based on the systems approach and therefore. it is adaptive anddynamic. The limitation of this theory is that it is not a single theory, decision theory and so on.

Types of Organisation

Of the varioue types of organisation, the following ones are very propular.

(i) Line Organisation,

(ii) Line and Staff Organisation,

(iii) Functional Organisation,

(iv) Committee Organisation,

(v) Project Organisation and

(vi) Matrix Organisation.

Let us now discuss each one of these in detail.

Line Organisation

The line orgnisation, also known as the 'Military Organisation', is the oldest form of organisation. In such an organisation, the superior at the top makes decisions and

communicates his decisions an assigns certain work to his subordinate. Thesubordinate, in turn, makes certain decisions, within the scope of his authority, andassigns certain work to his own subordinate and so on.

There is a vertical downward flow of authority and na upward flow of responsibility in such an organisation. As the military is organised in this fashion, the lineorganisation is given the name military organisation. The concept of lineorganisation may be explained by means of an diagram;


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General Manager

Production Manager

Assistant Production Manager

Foremen

Workers

Fig 4.2 - Line Organisation

Merits of Line Organisation

The following are the merits of line organisation :

1. It is very simple to establish line organisation.

2. There are no complicated relationships in such an organisation. It can easily beunderstood by anyone.

3. Line organisation clearly defines tha authority and responsibility of eachindividual. Every person knows clearly whom he should report to and who

should report to him.

4. Prompt decision can be taken,as there is unity and command and control.

5. In such an organisation, there is unity of command, i.e., a subordinate gets ordersfrom one superior only.

6. It is economical. It does not employ assistants.


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7. It provides scope for better supervision. This ensure greater discipline.

Demerits of Line Organisation

The demerits of line organisation are as follows :

1. It lacks specialisation. The line manager is resposible for both planning andexecution of the work assigned to him. In an typical line organisation, theproduction manager, for example, is responsible not only for attaining theproductiontargets but also for quality control, plant maintanence and so on.

2. The line manager are also overburdened with lot of work. The marketing manager,for example, has to not only monitor sales, but also assess the performance of thesalesman, take care of advertisment and sales promotion, he may become physically as well as mentally tried. This may also effect his efficiency.

3. In line organisation, there is always downward communication. The subordinates

are made to carry out the orders of the superiors. As a results, the subordinate may lose initiative.

4. The line manager enjoy monopoly in the matter of decision-making. It, thus, givesscope for decisions that are detrimantal to the interests of the subordinates.

In spite of the limitations mentioned above, line organisation as been found to begood for small concerns that employ a few workers.

Line and Staff Organisation

In this kind of orgnisation, staff expertd, who are specialists in specfic areas, assistthe line personnel. These experts do not have the powers to command any subordinate other than those who are under their direct control. They canonly advisethe line personnel on certain matters. The also do not have the authority to takedecision on vital issues. It s for line manager to advise whether to accept thesuggestions of the latter are over burdened with work.

The following diagram explain the concept of line and staff organisation :

General Manager

Manager -


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Manager -Manager-Finance Production

Personnel

Plant Superior

Service EngineerOffice-Spares

Foreman 1 Foreman 2Foreman 3

Workers

Fig 4.3 - Line and Staff Organisation

Merits of Line and Staff Organisation

1. The staff experts provide supports for line personnel. This enables the lineexecutives to perform their duties must more efficiently.

2. The line executives also get relief from work.The staff experts perform certainactivities which, in there absence, would be performed only by the line

executives. For example, in the absence of the purchase manager and the quality -control manager, the task of buying raw materials and quality

control wolud only fall on the production manager.


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3. The suggestions, given by the staff experts, enable the line executives to take

better decisions.

4. The sharing of work by the staff experts also helps to avoid delay in performingthe entire work.

5. As every executives performs only a specific task, he is able to do it with full

concentration. He is also able to work to his fullest capacity. This results inoverall efficiency.

Demerits of Line and Staff Organisation

1. Conflicts often arise between the line and staff executives.

2. The staff experts do not have authority to make decisions. They can only advise.Such a position without authority makes them ineffective.

3. It is difficult to explain in precise teams the pattern of authority relationshipsbetween the line and staff executives. This results in confusion.

4. The line and staff pattarn of organisation would enhance the cost of operation.

To conclude it may be said that line and staff organisation, with all its limitations,is suitable for a concernthat is expanding.

Functional Organisation

Such a pattern of organisation is suitable for large scale establishments. In afunctional organisation, there will be separate departments to look after differentlines of activities. The purchase departent, for example, will take care of all matterspertaining to purchase. The production department will look after all productionrelated activities. Sale, advertising, control of salesman etc., will be taken care of marketing de[artment. Provision of funds for short-team as well as long-teamoperation will be looked after by the finance department. Recruitment of staff,selection, placement, salary administration, training, etc., are the activitiesperformed by the personnel dapertment. Each department will be headed by amanager and will work according to hierarchy.

The concept of functional organisation may be explained by means of a simplediagram :

Board of Directors


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Managing Director

Procduction MarketingPersonnel

manager ManagerManager

Foreman 2 Foreman 1 Sales SalesOfficer- Officer-

Officer 1 Officer 2Training Salary

Workers Sales Assistants

Representatives

Fig 4.4 - Functional Organisation

Adventages of functional Organisation

1. It promotes Specialisation. Each Department specialise in a particular line of work.

2. Each functional heads lloks after only a specific activity. Thus, there is no overburdening of key executives.

3. Better contorl can be execised over the various activities of the cercern in view of the presence of so many key executives.

4. There will be maximum efficiency as each individual concentrates on a particulartask.

5. Specialisation and standardisation will result in mass production.


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Drawbacks of Functional Organisation

Functional organisation, however, suffers from the following drawbacks :

1. Functional organisation is unwieldy in view of the presence of a number of departments and divisions.

2. It is always difficult to secure proper co-ordination among the differentdepartments and individuals.

3. Any major decision requries the participation of different functional heads. Thismay leads to delay in arriving at a decision.

4. Functional organisation is also expensive to adope. The creation of the number of deoartments and devisions and also the employement of many

executives and subordinates staff will involve heavy expanditure.

Committee Orgnisation

A committee is a group of persons entrusted with certain tasks. The committeemembers are expected to discuss the problem under considaration in detail andcome out with a solution. The Borad of Directors of a company or a Trade Union of workers may be cited as an example of a committee. A number of committee may becreated in certarn depending upon the requirement. A review committee, For eg, may be consituted to review the progress of work at the various levels.

Types of Committees

Committees are useally classified into the following steps :

1. Standing or Permanent Committee,

2. Temporary Committee,

3. Executive Committee,

4. Advisory Committee,

5. Formal Committee, and6. Informal Committee.

Let us now see about each one.

Standing and Permanent Committee


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Such a committee is never dissovle. Although there may be changes inmembership, the committee remains always. The Borad of Directors of a Company isan example.

Temporary Committee

A temporary committee is one that is created for a specific purpose. as soon asthe purpose is accompalished, the committee stand dissolved. For example, if wagesrevision is due for the workers, the management may consitute a committee to study the various aspects of wage revision and make a report to it. As soon the committeesubmits its reports, it will stand dissolved.

Executive Committee

An executive committee is one that has powers to make important decisions forthe enterprise.The borad of directors of the company has such decisive powers.

Adversory Committee

An adversory committee can only make suggestions. It does not have powers tomake decisions.

Formal Committee

A formal committeeis one that is consititudes as per the rules and policies of theorganisation. It has hirearchy. It functions acording to the line of authority.

Informal Committee An informal committee is one that is not consitituted as per the rules and policies

of the organisation. Such a committee is the outcome of infoemal meetings of the workers to discuss there work-related problems.

Evalvation of Committee - Their Advantages and Disadvantages

The following are the advantages of the committee :

1. A committe provides the scope for group judgement. Every member of thecommitte can express there views whenever a problem is discussed. Thedecision that is finally taken wil certainly reflect the views and suggestions of all

the members. Such an advantage is not available an an individualdecision-making situation.

2. The committee also secures proper co-ordination among the individuals anddepartments. When the members of the committe meet and discuss a


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common problem, each mamber puts forth his views that are heard by others. Itis, therefore, possible for an individual to understand the problem of

another.

3. The committee members feels motivated when they participate in an discussions. As a results, the implement the decision with the same level of

enthusiasm with which they made it.

4. By acommodating diverse interest groups, the committee functions as ademocatic rganisation. For example, a comittee constituted in a business

establishment may have representatives of both the management and the workers.

5. Problems that cannot be sloved by an individual will have to be referred to acommittee. As a committee has intellecturals drawn fron different

spheres, it will able to find the solution easily.

6. The committe is also use as a tool to postpone decision on certain sensitiveissues.

The drawbacks of the committee are as follows :

1. Constituting a committee is a expensive affair. the committe members have topaid remuneration for they work. They have to paid dearness allowance

and travelling allowance each time a meeting is organised.

2. The committee members take more time on discussion and delibarations and asa result the decision gets delayed. The delay, in many cases, may

defeat the very purpose for which the committe has been constituted.

3. To reach a consensus among the members is often a difficult task. With a view of satisfying every member, a compromise decision may be made,

sometimes, at the last minutes.

4. There may be also a tendency on the part of some influential members in thecommittee to thrust their views on others.

5. There is no fixed responsibility on any member of the committee for the outcomeof its decision. It the decision turns out to be failure, no individuals

will come forward to take the blame.6. The committee may often be constitituted withoput the intension to provide any kind of a relief to the aggrieved persons. The idea is to avoid decision

on an important issue. It is for this reason that the committe is seen as a group of unfits, unwillingly, engaged to do the unnecessary.

How to make a committee effective ?


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The following measures may be taken to make committe more effective :

1. The committe must have a capable leader. The chairman of the committe must bean intellenctual. He must be able to conduct the proceedings well.

He must be good in the art of securing effective co-ordination among themembers.

2. The committe must not have to many members. For the committe to do its jobeffectively, the number of member should be restricted to five or six.

3. While selecting the members, due weightage must be given to the individualsability, commitment to work, honesty and integrity.

4. The agenda for the meeting should be prepared well in advance and sent to every member. This would enable him to equip himself better.

5. The proceedings of the meeting should be carefully recorded in the minute book.

6. Every member of the committee should be informed of the action taken on therecommendation of the committee.

7. The committee expenses must be subjected to proper audit. This would ensurethat there is no misuse of funds.

Project Organisation

The concept of the project organisation became popular particularly after world

war II. It may be successfully adopted if it is necessry to manage a small number of large project. each project team has specialists in different flelds. The projectmanager would co-ordinate the activities of tyhe team members.

The specimen of the project organisation is given below :

General Manager

Manager Project A Manager Project B

Engineering R&D Quality Control Accounts Engineering R&DQuality Control Accounts


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Fig 4.5 - Project Organisation

Advantages of Project Organisation

1. It can be design for suit individual projects.

2. It make use of specialised Knowledge and skill wherever requried.

3. It fixed responsibility on individuals on the work done by them.

Drawbacks of Project Organisation

1. The project manager may have a tough time dealing with specialists fromdifferent fields.

2. Evaluation of proformance of the various specialist also poses problems for theproject manager as he may not be well versed in engineering, R & D,

accounts and so on.

3. Decision-making is also difficult for the project manager who may be pressuriedby the specialists.

4. The time within with the project has to be completed will put pressure on every individuals.

Matrix Organisation

Matrix organisation is considered suitable for a large number of small project will have to managed. A ,atrix organisation is also known as 'Multiple CommandSystem' as it has two chains of command i.e., the flow of authority is vertical as wellas horozontal. Separate departments are established for each specified task. Butthese departments have to share the resources with the rest of the organisation andcannot claim any excusive right.

The specimen of a matrix organisation is given below :

General Manager


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Manager Manager- R&D Manager-Manager -

Production Personnel Account

Manager - Production R & D

Personnel AccountsProject A Group Group

Group Group

Manager - Production R & DPersonnel Accounts

Project B Group GroupGroup Group

Fig 4.6 - Matrix Organisation

Advantages of Matrix Organisation

The plus-point of matrix organisation may be stated as follows :

1. It offers the benefits of both functional organisation as well as technicalspecialisation.

2. It can be adoped for suit individual project.

3. It offer greater motivation for the personnel engaged in the project and they showkeen interest in its successful completion.

4. It also promotes communication relationships between the various personnelassociated with a project.

Drawbacks of Matrix Organisation

1. It goes againts the priniciple of unity of command as each individual gets ordersfrom both the functional and the project managers.

2. Dual command may results in confusion.


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3. Quick decision may not be possible in such a pattern of organisation in view of theconplex relationship that exists.

4. It also gives scope for conflicts among the personnel and as a result, the executionof the project may get delayed.

Documents

Human Resource Management unit 4