The functions or job contents necessary to reach objectives must be defined. This step is governed by two precepts. - Ernest Dale

This section will deal with the mechanics of organization—the actual processes or methods of creating and changing the company's organization structure. The problem is essentially that of best utilizing the people and resources presently on hand, as contrasted with the building up of an organization from scratch, described in Part I.

The application of systematic methods to the conduct of business is one of the most striking developments of the present day. The successful pursuit of business activities is increasingly based on carefully developed plans and well-ordered arrangements. The body of knowledge, called Organization, has become increasingly helpful in accomplishing the objectives of the enterprise.

Organization planning is the process of defining and grouping the activities of the enterprise so that they may be most logically assigned and effectively executed. It is concerned with the establishment of relationships among the units so as to further the objectives of the enterprise.