Chapter 1
The business organisation
Chapter learning objectives
Upon completion of this chapter you will be able to:
§ define the term organisation
§ explain the need for a formal organisation
§ distinguish between different types of organisation
§ summarise the main areas of responsibility for different functions within an organisation
§ explain how different departments co-ordinate their activities
§ explain the nature and process of strategic planning
§ explain the purpose of each level of organizational management.
1 The nature of organisations
1.1 What is an organisation?
‘Organisations are social arrangements for the controlled performance of collective goals.’ (Buchanan and Huczynski)
The key aspects of this definition are as follows:
§ collective goals
§ social arrangements
§ controlled performance.
Expandable text
As yet there is no widely accepted definition of an organisation. This is because the term can be used broadly in two ways:
§ It can refer to a group or institution arranged for efficient work. To organise implies that there is an arrangement of parts or elements that produces more than a random collection.
§ Organisation can also refer to a process, i.e. structuring and arranging the activities of the enterprise or institution to achieve the stated objectives. The very work organisation implies that there is order or structure.
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