Organization
Organization means to plan a business, to start it and run it. It means to bring the factors of production like land, labour and capital together to undertake a business or production process. In other words, organization is that organized body of human resources which brings the factors of production land, labour and capital together; assign each its proper task and remunerations. This implies not only running day to day business but also risk and uncertainty bearing.
According to Fredrick Behnam, “the term entrepreneur means the person or a group of persons controlling the policy of a firm.”
Prompt decision making capacity, far sightedness, planning capacity, capability of coordination, super vision capacity, hardworking, quality of leadership are the main characteristics of organization. Thus, organization is the mobilization of all scattered factors of production like land, labour and capital in the production process to generate output.
Characteristics/ Features of Organization:
1. Organization of production:
The organization takes steps to raise the necessary capital. It purchases machineries and materials, it hires labour, and it also arranges the production, distribution and exchange of goods and services.
2. Risk taking and uncertainty bearing:
Risk taking and uncertainty bearing are very important feature of the organization. There is risk of loss due to uncertain future, such as natural calamities, changes in government policy, change in fashion, etc. all such risks and uncertainties are borne by the organization.
3. Profit motive:
The objective of the organization is to earn profit and accumulate wealth. Profit is essential for the survival as well as expansion of business. The performance of the organization is evaluated in terms of profit earning capability.
4. Direction, supervision and control:
Besides organizing the production, an organization exercises close and constant supervision. It also gives direction and keeps controlling in order to achieve the goal.
5. Innovations:
Another important feature of the organization is introducing innovations. It implies a variety of things. It means introduction of new method of production, discovery of new raw materials, introduction of new commodity, etc.
6. Groups of persons:
Organization is the group of persons contributing their efforts towards certain goals. It begins where people combine their efforts for some common purpose.
7. Coordination:
Under the organization, different persons are assigned different responsibilities but aim of these persons happens to be same for the attainment of the objective of enterprise.
8. Division of work:
Division of work is very important feature of the organization. It is the basis of organization. Under the division of work, the entire work of the business is divided into many departments and every department is sub-divided into sub-works.
End of the Unit 1
