28

Office Set-Up And Organisation

28.1 Introduction
In the previous lesson you have learnt the meaning of ‘office’, the functions
of a modern office, and the need for and importance of office to business
enterprises. The office provides clerical assistance to the functional
departments.

Efficiency of the office workers depends on the working environment.

Suitable office layout, building space and good working conditions are
important from the point of view of employees, customers and others dealing
with the organisations. Office employees have to spend long hours in the
office performing repetitive routine work and official duties. Lack of
adequate, building space and proper working conditions adversely affect
employees’ efficiency. Besides physical arrangements, the work of the office
should be divided into departments, sections and units as per the need of
the organisation.

In this lesson you will learn about office set-up, departmentation, types of
office work, office layout and working conditions.

28.2 Objectives
After studying this lesson, you will be able to :

• state the meaning and significance of office set up;

16 :: Commerce (Business Studies)

• identify the departments in a modern office;

• outline the role and functions of office manager;

• explain the factors governing the choice of office accommodation;

• state the meaning and significance of office layout;

• describe the nature of working conditions and environment;

• identify the types of jobs in general office and functional departments.

28.3 Office set-up or organisation

Meaning of office set-up
Office set-up or organisation is the systematic arrangement of
positions in the office to enable office personnel to work as a team.
It is the framework within which office employees associate for
attaining the objectives of the office. It is the process of dividing
the activities of the office into departments, assignment of duties to
each department and providing necessary facilities to the personnel.
Significance of Office set-up
A planned organisation establishes a harmonious relationship between
people, work and resources. In a good organisation, every employee
knows what he is to do, and work is performed with speed, accuracy
and economy. It co-ordinates the efforts of different individuals and
ensures commonness of purpose. The importance of office
organisation is described below:
1. Facilitates management of office work:
In a small office, the manager can supervise the office work
personally. But in a large organisation the work has to be
distributed and supervisors can be appointed to supervise the
work on behalf of the office manager.
2. Delegation of authority
In a properly planned office organisation the manager assigns
some of the duties to his subordinates. Delegation of authority
of routine work is necessary for efficient flow of work.
3. Stimulates creativity
In a well-organised set up, each individual has specific duties,
his own area of activity and power. It stimulates creativity
 Office Set-up and Organization :: 17

and initiative in the individual and he may explore new

methods of doing the job.
4. Facilitates development of office personnel
Proper organisation of office is a pre-requisite for division of
labour and specialisation. It facilitates growth of office
personnel to the maximum extent in the area of their duties.

Departments or Sections of Modern Office

Now a days there are large organisations in existence which involve varied
and complicated operations. Therefore, the activities of organisation are
grouped into different departments or sections. Departmentisation is the
process of grouping business activities into homogeneous units. The number
and types of different departments in an office depend upon the nature and
volume of work. However, an office generally consists of the following
departments or sections:
1. Correspondence Section
Correspondence section takes care of incoming and outgoing letters,
enquiries, etc. This section receives incoming mail and deals with
them as per instructions from the concerned department. It also
prepares suitable replies to letters. This section is manned by a
section officer and clerks who are experts in noting and drafting of
correspondence.
2. Typing and duplicating section
In large organisations the volume of typing and duplicating work is
very large. Therefore, a separate department or section is created
for such work. It provides the typing and duplicating services to all
departments. In smaller organisations this section may be combined
with correspondence section also. The types of jobs available in this
section are those of stenographers, typists, duplicating machine
operator etc.
3. Filing, indexing and record-keeping section
This section may also be called ‘Filing’ or ‘Records’ section. It is
responsible for the preservation of all records for future reference.
Clerical positions are there in this section for filing, indexing, and
other related work.
4. Mailing section
This section deals with incoming and outgoing mail of the entire
18 :: Commerce (Business Studies)

organisation. The incoming mail is received, recorded in register,

sorted out and distributed to the departments. The outgoing mail is
prepared for despatch. The main jobs available in this section are
those of mail receiving clerk, despatch clerk and general duty clerk.
5. Accounts section
This section is responsible for maintaining the accounts of the
organisation. It prepares various financial reports for the use of
management. In large organisations, it may also contain an internal
audit section. The chief accountant or the chief accounts officer is
the overall incharge of this department. He is assisted by accounts
clerks, section officers and audit assistants.

6. Cash section

This section deals with receipts and payments in cash and by cheque
for the entire organisation. It operates under the control of the chief
cashier. He is assisted by cashier, petty cashier and assistants.

7. General Office

It is the central office of the organisation and is generally known as

the establishment section. This section formulates policies for the
entire office and directly or indirectly controls the departmental
offices. It also acts as the controlling unit as all information from
sectional offices pass through the general office. A section officer is
incharge of this section. He is assisted by UDCs and LDCs.

Relationship of the general office with other departments

Every activity of a business enterprise depends to a large extent on the
work done by the office. Likewise, the activities of the office depend on
the activities of other departments. For example the office helps the purchase
department in inviting quotations and tenders, in sending orders, in receiving
invoices and in making payments. On the other hand, the office depends on
the purchase department for information regarding actual delivery of items
purchased, their storage, etc. Production department depends upon the office
for procurement of necessary equipments and machines etc., and the office
renders clerical services like typing, duplicating, filing, mailing etc. The
relationship of office with the sales department is very important. The
office keeps contact with customers and supplies information about market
conditions to the sales department. Accounts department also prepares
various financial reports on the basis of vouchers and documents available
from the office for maintaining accounts in proper form. The Personnel
 Office Set-up and Organization :: 19

department also depends on the office for various services. The office
arranges advertisements for recruitment, receives applications, sends
interview calls and issues appointment letters. Thus, the work done in the
office is closely linked with the production, distribution and service activities
of the business.

Intext Question 28.1

I. Fill in the blanks

(a) Office _________ is the process of dividing the total work of

the office into departments.

(b) In a small office the _________ can supervise the work

personally.

(c) Proper organisation of office is a pre-requisite for division of

_________.

(d) Departmentation is the process of grouping business activities

into _________ units.

(e) Accounts department prepares various _________ reports

based on office records.

II. Match the following —

Sections Statements

(a) Correspondence Section (1) It is responsible for the proper

preservation of all records for
future reference.
(b) Typing Section (2) By this section outgoing mail is
prepared for despatch.
(c) Filing Section (3) It receives incoming mail along
with the instructions for dealing
with them.
(d) Mailing Section (4) It operates under the control of
the chief cashier
(e) Cash Section (5) It provides the typing and
duplicating services to all
departments
20 :: Commerce (Business Studies)

28.4 Role and Functions of Office Manager

The main purpose of the office is to provide various services to different
departments in the organisation. The office performs important functions
like receiving, recording, arranging and communicating information. These
functions are performed under the guidance of an executive known as
office manager.
The Office Manager
The Office Manager is ‘‘an executive who is responsible for planning,
organising and controlling office activities and leading the office
staff to achieve the purpose of the office.’’ In other words, the
executive entrusted with the supervision and control of office
activities is known as office manager. The task of providing efficient
and economical clerical services is the responsibility of the office
manager. The office manager occupies an important position in the
management hierarchy of an organisation.
Role of the Office Manager
The office manager is incharge of the office. The overall control and
supervision of office routines and functions are his basic
responsibilities. He is directly responsible to the chief executive of
the organisation. He has to support and implement the policies and
programmes of top management. He has to see that office work is
done efficiently as per schedule and deadlines. He has to supervise,
train and encourage the subordinate staff. He has to ensure effective
co-ordination between various departments and prevent conflicts
among different supervisory staff.

The office manager also facilitates the exchange of information

between different departments. There should not be any
communication gap. He encourages equitable distribution of work
among subordinates. He handles the problems tactfully.

Functions of the Office Manager

The office manager has to take the following steps to organise office activities:

(a) Grouping of office activities and their classification into major heads
or functions.
(b) Selection of suitable personnel for various jobs.
(c) Assignment of jobs to the selected personnel.
(d) Providing for necessary facilities like equipments, machines,
 Office Set-up and Organization :: 21

stationery, office forms, etc., to enable the office personnel to do

the assigned work.

An office manager has to perform all the managerial functions such as

planning, organising, directing and controlling in relation to office operations.
These functions are briefly described below:
(i) Planning
Office activities cannot be run efficiently unless they are planned
well in advance. Elaborate plans are prepared in writing in a proper
sequence to achieve the desired results. Systems of office procedures
are prepared with necessary details for the performance of all major
office activities such as filing, typing, duplicating, accounting,
communication, recording, mailing etc. Decisions have to be taken
well in advance regarding the recruitment of personnel, procurement
of office machines, equipment, stationery, etc.
(ii) Organising
This function involves arrangement of physical resources i.e., men
and materials. It also includes creating job positions at various levels.
The office manager prepares organisational charts, manuals, code of
conduct, office rules and job descriptions.
(iii) Directing
The office manager provides guidelines, issues instructions to the
subordinate staff and supervises their performance. He also provides
encouragement and guidance to all office employees to achieve the
goal set for them.
(iv) Controlling
Control over office activities is a must to ensure proper
implementation of plans and programmes formulated for achieving
the objectives of the organization. For this purpose the office manager
has to supervise the work regularly. He has to co-ordinate the
activities of the subordinates.
In addition to the above managerial functions the office manager has also
to undertake certain other functions such as public relations, human relations,
and provision of stationery, equipment, furniture and building space, etc.

Intext Questions 28.2

I. Fill in the blanks

(a) The office functions are performed under the guidance of an

22 :: Commerce (Business Studies)

executive known as office __________.

(b) The office manager is directly responsible to the __________

of the organisation.

(c) The office manager ensures __________ distribution of work

among subordinates.

(d) The manager has to select suitable __________ for various

jobs.

(e) An office manager has to perform all the __________

functions such as planning, organising, directing and
controlling.

II. Match the following:

Functions Statements

(a) Planning (1) The office manager issues instructions

to the subordinate staff.
(b) Organising (2) He has to coordinate the activities of
the subordinates.
(c) Directing (3) The function involves arrangement of
physical resources i.e. men and material.
(d) Controlling (4) He has to receive the visitors on behalf
of the organisation.
(e) Public Relations (5) Elaborate schemes are prepared in
writing in a proper sequence to
achieve the desired results.

28.5 Location of Office

Location means the place and site where the office of an organisation is
situated. Proper location of the office is of great importance to every
organisation. While taking decision on this issue, the management must
take into consideration the present as well as future needs. An unsuitable
location adversely affects the efficiency of operations.

Factors Determining Office Location

The following factors should be taken into consideration while determining
office location :
 Office Set-up and Organization :: 23

(1) Availability of Sufficient Space

The office should have sufficient accommodation and facilities i.e.,
rooms, storage space etc. Future expansion and requirements should
also be kept in view.
(2) Proximity to other Departments
The office should be located at a central place so as to be easily
accessible to other sections, units and departments of the organisation.
(3) Proximity to other offices
The office should be located in or near an existing office complex
which will enable it to derive the benefits of common services like
Post Office, Bank, Transport etc. available in the locality.
(4) Availability of Transport Facilities
Every office requires adequate transport facilities for the convenience
of office workers and outsiders dealing with the office.
(5) Service Facilities
Besides transport, availability of banking, postal, telephone and
telegraph facilities is also necessary for efficient conduct of office
functions. The services of insurance agencies are also needed for
various purposes. The office should, therefore, be located where
such facilities exist.
(6) Availability of Office Employees
It is desirable to locate the office where it may be easier to recruit
and retain different categories of office staff e.g., stenographers,
computer operators, accountants, clerks, typists, peons, etc.
(7) Health Environment
Every office requires healthy surroundings. The place must be free
from dust and noise. It should not be located in a congested area.
Unhealthy surroundings adversely affect the efficiency of the
employees.

In short, the location chosen must be one from where the entire organisation
can be served efficiently at a reasonable cost.

Office Building
A suitable building with sufficient number of rooms for carrying out the
administrative and routine functions is essential for every office. It should
24 :: Commerce (Business Studies)

be neither too spacious nor too small. The office space may be either
owned or rented. The management has to take a decision whether to own
or hire an office building. A suitable building may be constructed or an
existing building may be purchased.

An office building owned by the organisation has some advantages. It

provides a permanent address and location. This is convenient to outsiders
and customers. If the entire building is not required for use a part of the
building may be rented out to other organisations. This will bring additional
income. An owned building enhances the prestige of the enterprise. The
building owned by the organisation can be named after its name. Apart
form this, the building can be planned and designed to meet the particular
needs of the organisation.

However, there are also certain drawbacks of owned building. It requires

huge investment and its upkeep and maintenance and security also may
involve heavy expenditure.

Let us now examine the advantages of a rented building. The expenditure

of maintenance is not required to be incurred by the enterprise. There is
no heavy investment on construction. Apart from this, the office can be
easily shifted to a more suitable location, if necessary. On the other hand
a rented building suffers from certain drawbacks. For example it may involve
additional expenditure on alteration. Rent is also quite high in urban areas.

Office layout and working conditions

Meaning of Office Layout
Office layout can be described as the arrangement of different
departments, equipments and men within a given floor space with a
view to make optimum use of space and ensure maximum efficiency
of the office.

‘‘Office layout is the arrangement of all physical components with

the available floor space to provide maximum effectiveness and the
coordination of these components into efficient and attractive unity.’’
—Terry G.R.
Significance of Office Layout
Proper office layout is necessary from the point of view of office
efficiency. It ensures full use of office space and best use of office
machines and equipments. It is necessary for adequate safety of
valuable documents and records, and also for achieving smooth flow
of work. It allows free movement of office personnel from one
 Office Set-up and Organization :: 25

section to another. It facilitates better supervision and speeds up

inter-communication. It ensures privacy in the performance of
confidential work and creates favourable impression on visitors and
customers. Proper layout avoids mutual interference and ensures
comfort and satisfaction to the employees.

Characteristics of Ideal Layout

For effectiveness of office operations, it is necessary to have a proper
layout of the office. In practice it may be difficult to have an ideal layout,
but the under mentioned characteristics should be kept in view at the time
of planning layout:
1. Flow of work
Office layout must be planned in such a way so as to enable the
flow of work to be smooth and unhindered. Whatever the layout
may be, the movement of paper and people should be minimum.
Individual work should be considered from its starting point to
completion and the personnel, equipment etc., should be placed in
that order.
2. Free movement and observation
The floor space should be planned in such a way that it is free from
partitions, columns etc., (as far as possible) to facilitate free
movement and observation.

3. Adequate space for staff and equipment

There should be provision for adequate space for each assistant and
his equipments.
4. Service facilities
At the time of planning office layout, adequate provision of service
facilities for employees such as, internal communication, lifts,
drinking water, canteens, etc. should be made. It is necessary for
efficient performance of office work as well as physical comfort of
the office staff.
5. Private offices
Private offices and rooms are generally provided to senior executives
and important persons in office for confidential work and mental
concentration. However, the number of private offices should be
minimum.
6. Flexibility and expansion
Provision for expansion and adjustments should be made in the layout
26 :: Commerce (Business Studies)

plan. Additional staff and equipments may need to be accommodated

with little adjustments to cope with expansion.
7. Separation of noisy departments
Official work is mainly mental work and needs concentration which is
possible only in noise free atmosphere. Therefore, the noisy departments
should be separated or enclosed with sound proof partitions.

While planning office layout, it is to be decided whether to have one open

office or several private offices. An open office refers to a large room or
hall in which all the sections of the office are located. Private offices are
small rooms which are separated from one another by walls or partitions.
The modern tendency is to adopt the open office instead of private offices
for different sections. However, some private offices have to be provided
to top executives and also for work requiring privacy and concentration.

Working Environment
Office work is mostly of repetitive nature and leads to monotony of the
office staff. Sometimes mental work may be more fatiguing than manual
work. Excessive mental concentration may also be tiring. Therefore, it is
necessary that the office staff should be provided with congenial working
environment, which is conducive to work.

Office environment has a significant effect on the efficiency of office staff.

The surroundings in which office personnel work should be healthy and
pleasant. Poor office environment results in low output and low morale of
employees. Labour turnover and absenteeism also tend to be high. Therefore,
executives should arrange satisfactory working conditions in the office.

Essential Factors
Various physical factors which make for a suitable working environment
for the office staff are discussed below :
1. Cleanliness and sanitation
The office must have a neat, clean and attractive look so as to make
the employees be at ease and comfort and at the same time enhance
the prestige of the organisation. There should be provision of waste
paper baskets, dustbins, door-mats, spittoons etc., for the purpose.
2. Lighting system
Lighting is the most important element of working environment.
 Office Set-up and Organization :: 27

Poor lighting causes eye strain, mental fatigue and irritation to the
employees and results in delay and mistakes in office work. There
should be sufficient light with proper illumination.
3. Ventilation and Temperature
The office premises should be properly ventilated and facilitate fresh
air circulation. There should be natural ventilation, electric fans,
exhaust fans etc., as per need. Air coolers and air conditioners may
also be used for temperature control.
4. Reduction of Noise
Noise results in more errors, low quality of work, delay, slowing
down of pace of work and lower output. Noise may be an occasional
disturbance, or a regular occurrence. It may be unusually loud at
times. It may be from internal or external sources.

For control of external noise the doors or windows can be closed

but for internal noise, sound proof walls or partitions are necessary.
5. Interior Decoration
The art of decoration of the interior of a room or a building involves
the use of wall paper, carpets, curtains, wallhangings, etc. The office
should be internally decorated in such a way as to provide a pleasant
surrounding to all.
6. Furniture and Fittings
Office work is routine, monotonous and primarily indoor desk work.
Assistants have to sit daily in the office for long hours. Therefore,
suitable furniture should be provided so that employees may work
comfortably and speedily. Furniture includes desks, chairs, tables,
racks, cabinets, cupboards, safety trays, almirahs etc. The type of
furniture used in the office depends on nature of work in the various
sections, work space in office etc., but modern and better quality
furniture improves the general efficiency and adds to the prestige of
the office in the eyes of visitors.
7. Safety Arrangements
Some people think that office is a safe place and hardly any safety
precautions are required in office. However, accidents may and do
happen in offices like one falling from seven feet high filing shelves,
electric shock, fire, etc. Accidents cause loss of time, discomfort,
low morale of employee and loss of property. Therefore, proper
safety arrangements should be made in office.
28 :: Commerce (Business Studies)

8. Office Security
Office maintains and preserves records and documents. Also there
are valuable equipments and machines in use. Hence, there should
be proper security arrangements to prevent theft, burglary, etc.
Security measures like regulating entry, staff control, posting security
guards, etc., differ from office-to-office.

Intext Questions 28.3

I. Match the following

Statements Characteristics
(a) In the layout plan the provision (1) Flow of work
for adjustments should be made.
(b) There should be provision for (2) Free movement
sufficient space for all assistance
and equipments.

(c) Official work needs concentration (3) Adequate space

which is possible only in noisefree
atmosphere.
(d) The movement of paper and (4) Flexibility
people should be minimum.
(e) The office floor space should be (5) Separation of noisy
free from partitions, columns etc. departments

II. In the answer column write ‘T’ if the statement is true and ‘F’ if
the statement is false.

(a) The building must be equipped with fire fighting devices. ( )

(b) The office building must have adequate artificial light. ( )
(c) Office always needs big size of accommodation ( )
(d) The building must be suitable for the desired changes. ( )
(e) The cost of building should be reasonable ( )

III. Fill in the blanks

(a) The problem of layout relates to the arrangement of different

__________ in the space involved.
 Office Set-up and Organization :: 29

(b) Office layout must be planned in such a way so that the flow of
work would be __________.

(c) Every office requires a suitable building with sufficient number of

__________.

(d) Lighting is the most important element of working__________

(e) Office premises should be properly __________ for fresh air

circulation.

28.6 What You Have Learnt

Office organisation is the process of dividing various activities and functions
into departments, assignment of duties to each department and providing
necessary facilities to the personnel. It facilitates management of office
work, stimulates creativity and leads to specialisation through delegation
of authority. The major departments of an office are: correspondence, typing
and duplicating, filing and record keeping, mailing, accounts, cash and
general office. Every activity of an organisation depends on the work done
by the office staff. Likewise, activities of the office are dependent on the
work done in the organisation. For example the office helps the purchase
department in inviting quotations and tenders. Production department
depends upon the office for procurement of necessary equipment etc. Thus,
all the departments are benefited by the office.

The management functions, and responsibilities of the office govern all

activities of the office. The major processes are — planning, organising,
directing and controlling. These functions are performed under the guidance
of an office manager.

Location of an office should be decided with due care. The factors

determining office location are availability of sufficient space, transport
and other facilities, availability of staff, and healthy environment. Every
office requires a suitable building, owned or rented. Office layout means
arrangement of all physical components within the available floor space.
Good office layout ensures full and efficient use of men, material and
machines. The main characteristics of an ideal layout are— smooth
flow of work, free movement and observation, adequate space, flexibility
and segregation of departments. Good working environment includes—
cleanliness, lighting, ventilation, temperature control, reduction of noise,
interior decoration, proper furniture and fittings, safety and security.
30 :: Commerce (Business Studies)

28.7 Terminal Exercises

1. What is meant by the term “office set-up”?

2. What is departmentisation?

3. Under whose guidance are the functions of an office performed?

4. Define “working environment”.

5. Why is office divided into sections?

6. What is the importance of a general office?

7. What are the chief characteristics of office layout?

8. Describe the importance of lighting and ventilation in an office

building.

9. “Absence of organisation creates many problems”. Discuss this

statement.

10. Name the different departments and explain their functions.

11. Explain the role and importance of an office manager.

12. Describe physical factors which make a suitable working environment.

28.8 Answers to Intext Questions

28.1 I. (a) Set up or Organisation (b) Manager

(c) labour (d) homogenous (e) financial

II (a) 3 (b) 5 (c) 1 (d) 2 (e) 4

28.2 I (a) manager (b) chief executive (c) equitable

(d) personnel (e) managerial

II (a) 5 (b) 3 (c) 1 (d) 2 (e) 4

28.3 I (a) 4 (b) 3 (c) 5 (d) 1 (e) 2

II (a) T (b) F (c) F (d) T (e) T

III (a) departments (b) smooth (c) rooms

(d) facilities (e) ventilated