Organisation charts and manuals are used to describe the organisation structure. It is a tool for management control and gives full information pertaining to the organization. For more such innovative content on management studies, join WeSchool PGDM-DLP Program: http://bit.ly/ZEcPAc

1. Welingkar’s Distance Learning Division
CHAPTER-12
ORGANIZATION CHARTS AND
MANUALS
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Introduction
 Organisation charts and manuals are prepared for
the purpose of describing the organisation structure.
These are used as tools management control. They
give full information on a particular organisation. An
executive finds out his exact place in the
organisation structure from the chart and manuals. It
shows the responsibility and authority of executive.
He knows his superior for whom he is responsible
and his subordinates whom he has to supervise.
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TRANSLATION
An ‘action’ which is ordained, which is free from
attachment, which is done without love or hatred, by one
who is not desirours of the fruit, that action is declared to
be SATTWIC (pure); the one done with egoism and with a
longing for desire is RAJASIC (passionate); the one done
without regard for the consequences, loss, injury and
ability, is TAMASIC (dull).
INTERPRETATION
A good executive always undertakes a task simply as his
duty, fully understanding its impact, and with no wicked
intentions. An ordinary executive undertakes tasks for
personal gains and with a false pride. A bad executive
undertakes any task out of sheer lust and ignorance; with
no thought for capacity, limitations, destruction and
consequences.
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Meaning
 Organisation charts and manuals are devices
showing the organizational relationships and
within an organisation.
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Definition
 An organisation chart is diagrammatical form
which shows the important aspects of
organisation including the major functions
and their respective relationship, the channels
of supervision and the relative authority of
each employee who is in charge of each
respective function.
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Content of organisation chart
 Basic organisation structure and flow of
authority.
 Authority and responsibilities of various
executives.
 The relationships between the line and staff
officers.
 Names of the components of organisation
Positions of the various officer personnel.
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Content of organisation chart
 Number of persons working in an
organisation.
 The present and proposed organisation
structure.
 Ways of promotion.
 The requirements of management
development.
 Salary particulars.
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Types of organisation chart
 Vertical chart
 Horizontal chart
 Circular chart
 Master supplementary chart
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Chart revision
 Chart revision means keeping the chart up-to-
date on the organisation structure. It should
be noted that the chart must reflect the
organizational structure correctly.
Management can place the responsibility on
an individual to maintain the charts up-to
date. He is responsible for maintaining and
revision of the organisation charts.
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Principles of organisation chart
 Observation of line of by top executives
 Observation of line authority by subordinates
 Defining of position
 Non-assignment of same duty twice
 Avoid unique concentration of duty
 Organisation charts should be above
personalities
 Simple and flexible
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Advantages of organisation chart
 They give a clear picture organisation charts
 They show the levels of authority of relationships
prevailing among employees at a glance.
 Instructing work is simplified
 Organisation chart is a starting point for planning
organisation changes.
 The strengths and weakness of an organisation
are evaluated with the help organisation charts.
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Advantages of organisation chart
 Organisation charts act as authoritative sources of
information.
 The lines of authority and responsibility given in the
organisation chart are definite and formal.
 The lines of the primary function of the management.
Organisation charts help planning.
 The outsiders of the organisation can have a quick
understanding of each department in an organisation.
 Organizational disputes can be solved with the help of
organisation charts.
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Limitations of organisation charts
 Most of the organisation charts are just like photos
taken instant
 The organisation charts create more rigidity or
relationships prevailing among the employees of the
organisation.
 It is very difficult to maintain and ensure that the
organisation charts are up-to-date.
 The organisation charts do not show the informal
relationship existing among the organisation staff
members.
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Limitations of organisation charts
 There is no differentiation between line officers and
staff officers in an organisation
 The organisation charts produce a psychological
complex such as superiors, inferiors
 The relationship shown in an organisation chart does
not actually prevail among organisation the
employees.
 The word and lines used in an organisation charts
give different meaning to different persons.
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Organisation manuals
 This type of organisation manual is prepared
for the purpose of evolving for the
organisation and providing guidance to
control the development of the organisation
structure
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Meaning of organisation manual
 A small book which contains the information
regarding the organisation structure, duties
and responsibilities of each position, job,
description, salaries, prevailing relationships
among members including organisation
procedures and methods is called
organization manual.
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Contents of organisation manual
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Information
regarding
leave,
promotion,
transfer
Contents
Rules
regarding
leave, leaving
promotion,
transfer
A brief
explanation
Specimen
forms
Name and
address of the
top executive
Telephone of
the organisation
Address of the
branch office
Important
sections
Address of the
showrooms
Duties and
responsibilities
Full name
address of the
organisation

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Advantage of organisation manual
 The employee of the organisation can get a clear picture of the
organisation.
 The blueprint rules and regulations are followed by the
employees and the controlling work is minimized.
 The decisions taken by the management are given in an
elaborate manner. Organisation manual contains the
demanded method and procedures to be followed in nag
organisation. Then the organisation goals are easily achieved.
 Organisation manual helps the personnel to know their duties,
responsibilities and relationship with others within a short
period
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Disadvantages of organisation manual
 Organisation manual will has some become
outdated very soon. It is due to continuous
changes of the business, behavior of the
employees and the like.
 The human relationships are defined and
describes in the organisation manual but they
could not be practically followed in an
organisation.
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Disadvantages of organisation manual
 The organisation manuals are not reviewed
periodically. So the relevant changes are not
incorporated in the organisation manual.
 The preparation of organisation manual increases
the administrative expenses of the organisation.
 Much time is necessary to keep the organisation
manual up-to-date.
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