In the earlier blog, we learnt about the objectives of cost accounting and mentioned its relevance towards decision making. From today's blog, we would take a small detour to discuss various aspects of organization theory to really set the context for our discussion on other topics including finance in the future.
Before we begin this journey into understanding organization theory, it would be apt to look at the definition of organization. So this blog focuses on understanding and defining the term "organization".
Every day, we encounter numerous "organization" - the schools, hospitals, Infosys etc; all these have some characteristic in common. They are all:
- Social entities
- Goal Directed
- Are designed as deliberately structured and coordinated activity systems
- Are linked to external environment
It is common to see that every organization has policies and procedures that help scale up operations and grow, however it is people whom we find really driving organizations. It is their relationship with one another, their interaction that really enables organizations to attain their goals. It is this that organization theory deals with.
We will explore more about this as we begin discussing this further.
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