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The Great Secret: Organization
Articles

by Roy Posner


Of all the topics at this site, who would have thought that organization would be considered the great secret of business success? Organization is usually considered a rather dry topic that often leaves the reader disinterested or bored. However, at Growth Online we have discovered what makes organization in a company so compelling. A company's organization is an ever-changing, dynamic, living organism. If we can see organization in that light, then we can learn to understand it, shape it, and improve it. 

One definition of organization in a company is that capacity of a company to expand what an individual can do alone infinitely in space and time. Organization can also be explained as the means that enables the other four growth engines of the company -- market, technology, people, and finance -- to exist, and to expand endlessly with least effort. Without organization, the full creative potentials of the other four components of the company could never be realized. 

Then how does organization in a company grow more efficient and effective, more powerful and creative? Our research indicates that organization itself consists of three basic building blocks. They are Job Positions, Activities, and Systems. The key to the growth of organization lies in understanding how each of these subunits of organization develops, and how they interact with one another to form an organic whole.

Job Positions Activities Systems


Job Positions
Structure -- The first thing to consider is if the structure of jobs in the company are right for today's business and for your plans for tomorrow. Therefore, it's worth doing a serious analysis of whether or not the structure of your company contains the right makeup and balance of job positions.

Authority -- Second we need to examine whether each job position in the company is matched by a level of authority for the person in that job to carry out the tasks contained within the job. In addition, the person filling the job needs to clearly know whom he or she is to report to (for the overall job and for each task in the job).

Distribution of Tasks -- Third, one needs to examine whether the job tasks that are assigned to the individual are the right tasks for that position. Perhaps some tasks for a job should not be included in the job, or some tasks may need to be added to the job, or some may simply need to be delegated to another job position (especially less important tasks involved in the job). Therefore, an analysis of the content of every job position the company is also worthy of a detailed analysis in the company.

Right People, Training -- Fourth, once job positions in the company are properly allocated, and job tasks for individual jobs are maximized for efficiency, individual job positions need to be filled by the right people, and each person trained to the hilt for that job.



Activities
An individual person carrying out a task is an act, which is perhaps the minutest subunit that exists in a company. Individual acts are linked to one another in chains of acts called activities. Like jobs, activities can be continuously improved throughout the organization as well. Each improvement to an activity releases fresh energy and makes the organization more effective.

Therefore, reviewing the major activities in a company is a highly worthwhile endeavor. For example, many high tech manufacturing companies are reviewing their product development activities, thereby maximizing the speed of products and services to market, as well as the efficiency and quality of their products and services. Therefore, a thorough activities analysis can simultaneously make the company more efficient and effective, releasing great energy and prosperity.

Make a list of all of the activities in your company (such as selling, accounting, manufacturing, human resources, information technology, etc.). Then determine (e.g. through research, interviews, etc.) how each of the critical activities can be upgraded or reorganized. Then implement your plan for improvement. Follow this up with improvements of less critical activities.

 

Systems
The ultimate building block of organization is systems. Systems are simply mechanisms that automate activities, or interlinking activities. Systems possess the power to carry out activities much more quickly, precisely and regularly than individuals can perform them on their own. The productivity of an organization is determined by the extent to which routine and recurring physical activities are systematized and turned into standard operating procedures.

Systemization doesn't just make activities work more efficient; it makes people more relaxed and cheerful at work because the activities almost "take care of themselves." In fact, the happiest people are often in companies that have turned most or all activities in the company into corresponding systems.

Think about systems in your company (e.g. computerized bookkeeping, email, sales tracking, sales analysis, manufacturing, credit checking, etc.). Then think about the following questions. Do you have systems in place for every major activity in the company? Which activities need to be systematized? How should they be systematized? And then there are the existing systems. How can they be upgraded to the next level of efficiency?



Coordinating and Integration
The ultimate truth of organization is the ability of the three building blocks to work together. The real power of organization arises from its capacity for coordination and integration of people, activities, and systems. When departments and divisions move from isolation to coordination and integration, the real power of organization is released. Coordination and integration are the advanced tools of organization.

When people job positions are more coordinated with one another, when activities are more integrated and coordinated with one another (e.g. selling to accounting, manufacturing to information technology, and endless other connections), and when systems are interrelated (e.g. accounting and bookkeeping to sales tracking, or sales tracking to manufacturing, etc.), the real power of organization is released. This coordination and integration can lead to explosive energy and vitality in the company.

Take the idea of integration of systems. Suppose there are 25 systems in a company with a minimum of coordination and they are all coordinated to a maximum extent, the same staff can accomplish twice or thrice more. To give a simple example, in a college if the timetable of the dozen departments is not coordinated, i.e. if each department has its own timetable, the two-year course will extend to five years and twice as many classrooms must be built. 

(By the way, software programs and/or Internet sites are a powerful tool to organize activities into systems. They can also be used to integrate and coordinate existing systems together. For example, a project management program could be used to coordinate the schedules of the different department in this example.)

So ask yourself the following questions about your company. How can you better coordinate and integrate tasks among job positions? How can you better coordinate and integrate activities in the company to one another? How can you better coordinate and integrate systems in the company to one another?



Summary
Organization is a living organism that can be energized to affect every and any thing related to it. The secret to keeping an organization alive and youthful is to keep it operating at its maximum capacity and to keep increasing that capacity by constantly upgrading the building blocks of organization (job positions, activities, and systems), and then coordinating and integrating the subunits that make up that building block. In addition, organization is maximized when top management develops a vision and mission, including clear objectives and business values, which are well communicated by top management to the staff, and well executed by the employees in the company.


STRATEGIES

  1. Establish clear job descriptions for every job position and create a system whereby the responsibilities and authority of each position are clear to other people in the company.
  2. Analyze the job positions of executives, managers and supervisors to identify job position tasks that can be delegated to lower levels and the conditions necessary to make that delegation effective.
  3. Conduct an analysis of major activities in the company such as selling, advertising, order taking, invoicing, product development, project management, purchasing, maintenance, customer service, dispatch, etc. to identify ways to increase the speed, reduce the cost, eliminate unnecessary steps and improve the quality of these activities. Afterwards extend the analysis to minor activities as well.
  4. Turn every activity in the company into one or more systems.
  5. Assess the effectiveness of important systems in the company in terms of their speed, manpower requirements, quality of work and cost of operation. Identify steps to improve their performance on these variables.
  6. Consider all the ways you can coordinate and integrate existing activities to one another, and then systems to one another.

 To see additional Growth Online thoughts on Business Organization, click here


RELATED TOPICS

  • To learn about the importance of organization for an individual, please click here.
  • To review a more detailed analysis on the above discussion of the great secret of organization in the book The Vital Corporation, please click here. (MIRA)
  • To learn about how organization is a measurement of social development and evolution, click here.
  • To learn about how the Internet is the ultimate example of organization, and thus a driving force of social development and evolution, click here.

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