10 Advantages of a Sound Organization - Explained!

A sound organisation offers the following advantages:

1. Enhancement of Managerial Efficiency:

A sound organisation brings a proper coordination among various factors of production and leads to their optimum utilisation. It avoids confusion, duplication and delays in work. It motivates the worker by proper division of work and labour. It reduces the workload of executives by delegation of authority.

2. Growth, Expansion and Diversification:

Organisation provides the framework within which an enterprise can expand and grow. Through organisation, management can multiply its strength. In a good organisation, the money and effort spent on different activities are in proportion to their contributions. It is through proper organisation setups that many firms have grown from humble beginning to giant size organisations.

3. Specialisation:

A sound organisation structure provides the benefits of specialisation. Various activities are allocated among different individuals according to their qualifications, experience and aptitude. It brings job satisfaction and feeling of motivation among employees, and increases their efficiency. Systematic organisation of activities helps to secure economies and also to minimise costs.


4. Adoption of New Technology:

A properly designed and well balanced organisation permits prompt adoption and optimum use of technological improvements. It has the capacity to absorb changes in the environment of business and to provide a suitable reaction to such changes. A good organisation helps in the development of new and improved means of doing things.

5. Co-ordination:

Organisation facilitates co-ordination of diverse activities. Different functions are integrated together to accomplish the desired objectives. Clear lines of authority and responsibility between various positions help to ensure mutual co-operation and harmony in the enterprise. A good organisation enables people to work in a team spirit.

6. Training and development:

By delegating authority to lower levels, training and development of future executives is made possible. A good organisation puts ‘Right man at the right job’ and provides them right training and managerial development programmes. By appointing employees in different departments and assigning those different jobs, their training needs can be ascertained.

7. Creativity, Initiative and Innovation:

A good organisation encourages initiative and creative thinking. Employees are motivated to break new grounds and try unconventional methods. A sound organisation offers the scope for recognition of merit followed by financial incentives to the personnel showing creativity.

8. Check on Corrupt Practices:

A weak and unsound organisation is a source of corruption and inefficiencies. Well organised, well-defined, disciplined and sound organisations boost the morale and motivation of workers. It develops a feeling of involvement, belongingness, devotion, honesty and sincerity among employees. It prevents corruption, inefficiencies and wastages in an enterprise.

9. Proper Weightage to all Activities:

A sound organisation divides the entire enterprise into different departments, sections and sub-sections according to the functions to be performed by them. Each function of an enterprise has got its own importance.

Emphasis is given according to their relative importance. Funds and manpower is allocated accordingly. Bigger and important departments like production are given more money and manpower.

10. Better Human Relations:

Human beings involved in an organisation are only dynamic element of organisation. A dedicated and satisfied group of persons proves an asset to any establishment. An organisation, built on sound principles, helps harmony in human relations.

With properly defined authority, responsibility and accountability, different persons enjoy job-satisfaction. An organisation consists of human beings and their satisfaction helps in improving human relations.

Thus, organisation is the foundation of management. Sound organisation is an indispensable means for efficient management and better business performance. It not only facilitates efficient administration but encourages growth and diversification.

It provides for optimum use of new technology, stimulates innovation and creativity.

Submitted by : Professor Patrick, Category : Organization, Tag : Sound Organization