Page 95 - DMGT402_MANAGEMENT_PRACTICES_AND_ORGANIZATIONAL_BEHAVIOUR

Management Practices and Organisational Behaviour

Notes accountability." The essence of formal organisation is conscious common purpose and
comes into being when persons:
(a) Are able to communicate with each other

(b) Are willing to act, and
(c) Share a purpose.
The formal organisation is built around four key pillars. They are:
(a) Division of labour

(b) Scalar and functional processes
(c) Structure, and
(d) Span of control
Thus, a formal organisation is one resulting from planning where the pattern of structure
has already been determined by the top management.
Characteristic of Formal Organisation
(a) Formal organisation structure is laid down by the top management to achieve
organisational goals.
(b) Formal organisation prescribes the relationships amongst the people working in
the organisation.
(c) The organisation structures is consciously designed to enable the people of the
organisation to work together for accomplishing the common objectives of the
enterprise.
(d) Organisation structure concentrates on the jobs to be performed and not the
individuals who are to perform jobs.
(e) In a formal organisation, individuals are fitted into jobs and positions and work as
per the managerial decisions. Thus, the formal relations in the organisation arise
from the pattern of responsibilities that are created by the management.
(f) A formal organisation is bound by rules, regulations and procedures.
(g) In a formal organisation, the position, authority, responsibility and accountability
of each level are clearly defined.
(h) Organisation structure is based on division of labour and specialisation to achieve
efficiency in operations.
(i) A formal organisation is deliberately impersonal. The organisation does not take
into consideration the sentiments of organisational members.

(j) The authority and responsibility relationships created by the organisation structure
are to be honoured by everyone.
(k) In a formal organisation, coordination proceeds according to the prescribed pattern.

Advantages of Formal Organisation
(a) The formal organisation structure concentrates on the jobs to be performed. It,
therefore, makes everybody responsible for a given task.

(b) A formal organisation is bound by rules, regulations and procedures. It thus ensures
law and order in the organisation.

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