When a member of an organization is placed in a position with duties ill defined in their relation to other duties what happens? Naturally he attempts to make his own interpretation of those duties and, where he can, to impose this view on those about him. In this process he encounters others in similar cases, with friction and lack of coordination as the inevitable result.
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James David Mooney (18 February 1884 – 21 September 1957) was an American engineer and corporate executive at who played a role in international affairs in the 1930s and early 1940s. His career was disrupted when he was accused of Nazi sympathies in 1940. He is noted for his seminal contributions to the field of organizational theory.
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My own principal interest lies in the sphere of , which of all major forms of human organization is, in its present magnitude, the most modern. For this the reason is evident. The vast present-day units of industrial organization are products mainly of one creating factor, namely the technology of mass production, and this technology, born of the industrial revolution, has been almost exclusively an evolution of the last century. In contrast other major forms of human organization — the state, the church, the army — are as old as human history itself. Yet if we examine the structure of these forms of organization we shall find that, however diverse their purposes, the underlying principles of organization are ever the same.
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The common impression regards this scale or chain merely as a "type" of organization, characteristic only of the vaster institutions of government, army, church and industry. This impression is erroneous. It is likewise misleading, for it seems to imply that the scalar chain in organization lacks universality. These great organizations differ from others only in that the chain is longer. The truth is that wherever we find an organization even of two people, related as superior and subordinate, we have the scalar principled.
Worthiness in the industrial sphere can have reference to one thing only, namely the contribution of industry to the sum total of human welfare. On this basis only must industry and all its works finally be judged… The lessons of history teach us that no efficiency of procedure will save from ultimate extinction those organizations that pursue a false objective; on the other hand, without such efficient procedure, all human group effort becomes relatively futile.
As coordination contains all the principles of organization, it likewise expresses all the purposes of organization, in so far as these purposes relate to its internal structure. To avoid confusion we must keep in mind that there are always two objectives of organization, the internal and the external. The latter may be anything, according to the purpose or interest that calls the group together, but the internal objective is coordinative always.
By the term functionalism, considered as a principle of organization, we mean the differentiation or distinction between kind of duties. Thus it is clearly distinguished from the scalar principle, in which there is also differentiation, but of quite another kind. The scalar differentiation refers simply to degrees or gradations of authority.
The informative phase refers to those things which authority should know in framing its decisions; the advisory, to the actual counsel based on such information; the supervisory, to both preceding phases as applied to all the details of execution. The point is that the line represents the authority of man; the staff, the authority of ideas. The staff is purely an auxiliary service. Its function is to be informative and advisory with respect to both plans and their execution. This is implicit in the word "staff" which is something to support or lean upon but without authority to decide or initiate.
It is essentially to the very idea and concept of organization that we there must be a process, formal in character, through which the supreme co-ordinating authority operates throughout the whole structure of the organized body. This process is not an abstraction; it is a tangible reality observable in every organization. It appears in a form so distinct and characteristic that it practically names itself, — hence the term Scalar Process.
Organization begins when people, even if they be only two or more, combine their efforts for a given purpose. We have shown this by the simple illustration of two people uniting their efforts to lift and move some weighty object. This combination, however, is not the first principle of organization. It is only an illustration of organization itself. To find the first principle, let us carry the illustration a step further. The efforts of these two lifters must be coordinated, which means that they must act together. If first one lifted, and then the other, there would be no unity of action, and hence no true organization of effort. Here then we find the first principles of organization.
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Although a separate function of some kind is implicit in the very existence of a separate department, there may be, especially in manufacturing procedure, certain general functions, appearing in some form of departments, which in turn may require organized supervision and correlation. Thus we have cross-functionalism.