Organizing is a function of management that arranges people and resources to work towards a goal, according to the Encyclopedia of Small Business. Purposes of organizing include determining tasks to be performed, dividing tasks into smaller jobs, grouping jobs into various departments, specifying authoritarian relationships, delegating authority to accomplish tasks and allocating resources in a coordinated fashion.
Managers must first make decisions regarding division of labor, work specialization, chain of command, departmentalization, centralization and formalization. After these decisions are finalized, groups then mobilize to achieve a stated goal.
The division of labor involves deciding who does particular jobs. Some workers or departments have special skills while others have different sets of abilities. Managers must organize these workers in certain ways to get jobs done.
Jobs are then divided into different departments. One of the most common ways to departmentalize is to group workers together by function. If certain workers and jobs serve similar functions, those people should logically work together.
The chain of command, along with the span of management, determines who is responsible for getting various tasks done. Managers must decide how many people to oversee effectively to get the tasks done. Similarly, centralization and formalization refer to rules, procedures and decision-making. This process sets forth who has the authority to enforce the rules along the chain of command.
Organizing decisions can be influenced by strategy, size, environment and technology. Organizing as a function of management was first proposed by Frenchman Henri Fayol in 1916 in his article "General and Industrial Administration."