Organizing is the process of identifying and grouping of activities required to attain the objectives, delegating authority, creating responsibility and establishing relationships for the people to work efficiently. As a process, organization refers to the process of determining, arranging, grouping and assigning the activities to be performed for the attainment of objectives. Thus, the organization is a mechanism or structure which helps the activities to be performed effectively. The organization is established for the purpose of achieving the business objectives. An organization structure should be designed to clarify who is to do what task and who is responsible for what results. The organization structure is designed both from mechanistic point of view. It is not only a mechanical structure of duties, activities and relationships, but also web of human interactions within social group with attitudes and aspirations. The success or failure of an organizing depends upon the principles to be followed in the organization.

One of the major problems of leadership which applies today just as much as it always done is: how can a manager be democratic in his relations with subordinates and at the same time maintain the necessary authority and control in the organization for which he is responsible? The trend in recent year has been to challenge the efficiency of highly derivative leadership. Increasing attention is now being paid to problem of motivation, human relations and participation. The concept of group dynamics with its emphasis on the member of the group than one of the leader is now emerging. The trend is to reduce the power of one leader and to make group members responsible for sitting and achieving their own goals. The leadership concept is now being under played to a considerable extend. When a task is to be done, the feelings should not be so much that the task is being done by one dynamic leader but the task has been completed by everyone in the group.

Line authority exists between superior and his subordinate. Line authority is the direct authority which a superior exercises over a number of subordinates to carry out orders and instructions. In organization process, authority is delegated to the individuals to perform the activities. These individuals, in turn assign some of the activities to persons working below. Then they delegate authority in the hierarchy and them. This process goes on creating superior and subordinate relationship. In line authorities, officials are in the chain of command from higher position to lower position in the organization. There is command relationship exist between every superior and subordinate. It can be considered as a channel of communication between superior and subordinate of the organization. The line authority caries ultimate responsibility for the work assigned. Each individual in the line is accountable for the proper performance of the activities assigned to him. Each subordinate is answerable to his question.

Staff authority is exercised by a man over line personnel. The relationship between on the line manager with whom he works depends in part on the staff duties. In a management, staff refers to those elements of the organization which help the line to work most effectively in accomplishing the primary objectives of the enterprise, the nature of the staff relationship is advisory. The function of staff is to investigate research and give advice to line managers. Staff personnel’s having specialized knowledge and skills reduce the burden of line personnel’s. Staff managers have right to direct or command subordinate who are working under him. But with respect to line personnel, they play an advisory role of recommending and assisting. An advisory staff manager provides advice, assistance and information and it depends on the line manager whether these are put into action or not. Staff specialists may be allowed the time to think, to gather data, and to analyze the data when the line personnel are very busy in managing operations.

Managerial skills are the main mental ability to analyse the current status of the corporation and the future trends to be followed. These analysis will recommend the corrections that should be done to raise the profit. The analysis sometimes results in a Break Even Point (BEP) when the profit and loss are balanced and no yield from the organization. This is allowable in the initial time of any business. We have to keep in concern that the higher authority should seek for better analysis.