The process of organising consists of the following steps:

1. Identification of activities

Every enterprise is created with a specific purpose. Based on this, the activities involved can be identified. For example, in a manufacturing firm, producing goods and selling them are the major activities in addition to routine activities like, paying salary to employees, raising loans from outside, paying taxes to the government, etc. and these activities vary when the organisation is a service concern or a trading firm. Therefore, it is essential to identify various activities of an enterprise.

2. Grouping of activities

Once activities are identified, then they need to be grouped. They are grouped in different ways. The activities which are similar in nature can be grouped as one and a separate department can be created.

For example, activities undertaken before sale of a product, during the sale of the product and after the sale of the product can be grouped under the functions of a marketing department. Normally, all activities of a manufacturing unit can be grouped into major functions like purchasing, production, marketing, accounting and finance, etc. and each function can be subdivided into various specific jobs.

3. Assignment of Responsibilities

Having completed the exercise of identifying, grouping and classifying all activities into specific jobs, they can be assigned to individuals to take care of.

4. Granting authority

On the basis of responsibilities given to specific individuals, they are also to be given the necessary authority to ensure effective performance.

5. Establishing relationship

This is a very important job of management as everybody in the organisation should know as to whom he or she is to report, thereby establishing a structure of relationships. By doing so, relationships become clear and delegation is facilitated.