Modern Office and Its Functions Part 1

Modern Office and Its Functions “An Office may be regarded as a place where the control mechanisms of an organisation are located.” — GEORGE R. TERRY INTRODUCTION The complexities of business activities are increasing day-by-day. With the spectacular developments and advances in the fields of science and technology the manufacturing techniques have undergone a rapid change. The economies of large-scale production have brought into being a number of multinational business organisations. The ever-widening markets also pose a challenge by themselves. The complexities of legal provisions (of industrial and business legislation), which are subject to constant change, to achieve social objectives, also require more than adequate attention. Moreover, modern management has to take care of the new emerging human relations in business. All these problems can be satisfactorily tackled only when adequate information is available. Information is required by all the members of an enterprise. An efficient and effective organisation and management must possess all the information it needs to enable it to come to a variety of decisions. To retain information, to analyse it and furnish it for the management, are the basic functions of a modern office. So much so that the phrase ‘Information Management’ has gained currency in preference to the older one ‘Office Management’. The reason is that Information Management connotes more precisely the activities performed by a modern office. MEANING OF OFFICE In common parlance, an office is understood to be a place where clerical work is performed and where all kinds of paperwork (letters, correspondence, files, records, etc.), is maintained and dealt with. It is “a central place where all sorts of clerical work is done to coordinate and control the affairs of the whole organisation”. A few definitions may be noted: Chapter 1: Modern Office and Its Functions (i) “The office is the administrative centre of a business. The purpose of an office has been defined as the providing of a service of communication and record.” — Mills & Standingford (ii) “An Office is the place where the control mechanisms for an enterprise are located; where records are initiated for communication, control and efficient operations of the enterprise.” (iii) “An Office is the place where work in connection with the preparing and furnishing of information is done.” (iv) “The acts of collecting, processing, storing and distributing information comprise the functions of the Office.” —George R. Terry (v) “An Office is a place where business is transacted or professional services are available. — Random House Dictionary It may be noted that these definitions emphasise “paperwork” as the main and perhaps the only function of an Office. However, in modern business, the term Office is used in a still broader sense. Consider the following statement: “It is a mistake to regard an Office as a specific place — instead we are forced to conclude that an Office exists anywhere, that certain kinds of work are performed.” — Edward Roche The modern approach to the study of the term Office is to view it as a function rather than a particular place. When an Office is regarded as a function. “It can plan, organise, coordinate, standardise and supervise paperwork, wherever it is done and whosoever does it.” But if it is viewed as a certain place only, the “paperwork” done outside the boundaries of that place called the Office would not be under its control. The Office Manager in such a case is responsible only for the paperwork falling within his own department. For instance, minutes of board meetings, financial records, sales and purchase records, are all integral parts of the operation of a business and must be planned, organised and controlled to ensure an effective administration of the business enterprise. According to Leffingwell and Robinson,1 “the essential feature of the office is the work itself, not who does it or where it is done. If it is office or clerical work in one place, it is office or clerical work everywhere regardless of where the work is done or who does it.” In the words of Charles O. Libbey: “The office is not in one place; no matter how much we centralise its services, there will still be office work at the point of use. Some enterprises are almost all Office. The activities of the Office do not, strictly speaking, constitute a function; they are parts of all functions.” To conclude, it may be said that an “office” refers to the functions performed by a certain set of persons rather than the place, where clerical work is done; and the act of collecting, processing, storing and distributing information comprise the functions of an office. 1. Textbook of Office Management. Office Management OFFICE WORK According to an old concept, “Office Work” is concerned primarily with the records of an enterprise — making records, using records and preserving them for future reference. This concept postulates Office Work as clerical work. For instance, communication, mechanical data processing, planning and scheduling, etc., are all within the scope of Office activities, and may, therefore, be referred to as Office Work. According to G.R. Terry, “Office Work includes verbal transmission of information as production of written records and reports in order to provide the means for quickly summarising large amount of data to supply a factual basis of managerial control”. According to Leffingwell and Robinson: “Office Work is concerned with records and statistics, with communication, with computing, with planning and scheduling. Every office task comes within the scope of one or the other of these activities”. Office Work, by its nature, is Office Work; who does it or where it is done are of little significance. It may be done by a clerk or an officer at a place called the Office or by a foreman in a factory, or by a salesman on the road or by an executive at his residence. “Office Work is, therefore, primarily concerned with making, preserving and using records — the records about purchasing, producing, selling, accounting and correspondence, inventories and written or printed memorandums of all kinds. These records may be required in an organisation for an efficient and effective control of its operations. It is one of the means by which each department of a business carries out its functions and by which it coordinates its duties with those of other departments.” Various research studies on Office Work have revealed that about one half of the total Office time is consumed in typing and duplicating activities and about one-third of the total office time is taken up in filing, indexing, checking, mailing, communication, etc. Some variations in this matter may be there depending upon the degree of mechanisation of Office activities. An important characteristic of Office Work is the difficulty of its measurement. This is because of the following factors: 1. 2. 3. 4. Office Work is predominantly mental work, which is difficult to measure. There is greater variability of volume of work from office to office. There is irregularity in the flow of Office Work. It is difficult to standardise several operations in the Office. Since the Office Work cannot be accurately measured, it is difficult to fix precise standards in respect of individuals and sections of the organisation involved in carrying out Office Work. Factors Contributing to the Growth of Office Work The amount of Office Work has grown tremendously in our modern economy. With the growth of industrial revolution and the expansion of economic activities, the quantum of Office Work has increased manifold. In addition, the following factors have also contributed to the growth of Office Work: 1. Increase in size and complexity of business caused the growth of Office Work. As the organisation grows in size, the paperwork grows at a geometrical rate. 2. Management is becoming increasingly aware of the need for proper and timely information on all the aspects of the business operations so as to arrive at intelligent decisions. Chapter 1: Modern Office and Its Functions 3. Recognising the indispensability of Research and Development (R&D) activities for survival and growth in modern times, business houses are increasingly having R&D in such aspects as markets, products, manufacturing processes, etc. As a result, additional Office Work is caused. 4. The ever-increasing information demand of governments are also continuously causing growth of Office Work. Every business organisation has to prepare income tax returns, sales tax returns, provident fund deductions, and ESI deduction statements, financial statements, etc., for individuals as well as for the government. All this involves increase in office activities. 5. With the increase in number and size of service activities like banking, insurance companies, advertising, mail order houses, etc., with which a particular business has to deal, Office Work has grown. These activities require large amount of paperwork and large proportions of Office Workers have to be employed to process the voluminous records. 6. A large amount of growth of Office Work occurred because of failure to modernise and simplify office practices in keeping time with changing requirements of the office. There has been a tendency to employ more and more office workers rather than devising ways of dealing with the situation, more effectively. OFFICE ACTIVITIES Each office has a personality of its own. This personality is a reflection of the purposes for which an office exists. The Manufacturing Office will have a profile that differs from that of a Sales Office. The accounting Office will have a different orientation from a research and development Office. “In organising a new office, the Office Manager must first determine the prime reason for the existence of that Office and then add the necessary ingredients to bring about an efficient operating entity that achieves predetermined results.2 Although offices differ from one another in prime responsibility, many activities are commonly carried out by all the offices. Some of these activities3 are: (i) (ii) (iii) (iv) (v) (vi) (vii) Processing Incoming Mail; Processing Outgoing Mail; Dictation; Transcription; Typing; Printing; Copying; (viii) Filing; 2. C. Spencer Everhardt, Organising and Staffing the Office. 3. Dicter Jaeger provides a complete list of Office activities which include: (1) Accounting. (2) Internal auditing. (3) Credit and collection. (4) Companywide budgets. (5) Budgets for the Office (6) Planning new Office building (7) Office space planning. (8) Recruitment. (9) Training Office staff. (10) Office maintenance. (11) Office decor. (12) Office security. (13) Administrative systems and procedures. (14) Computer operations. (15) Planning work for computers. (16) Electronic accounting machine room. (17) Management information systems. (18) Purchase of big equipment, e.g., computers, large accounting machines, etc. (19) Purchase of desk type of equipment. (20) Office supplies. (21) Copying and duplicating. (22) In-house printing. (23) Purchased printing (24) Records management. (25) Central-files (26) Microfilm services. (27) Library. (28) Communications (Telephone, Telex, Fax, etc.) (29) Mail and messenger. (30) Cafeteria, dining room, etc. (See Carl Heyel, Handbook of Modern Office Management, etc.) Office Management (ix) Records Retrieval; (x) Records Disposal; and (xi) Communication. THE PURPOSE OF AN OFFICE The purpose of an Office is mainly to provide the services of communication and of record. office is, in fact, a processing medium. In addition, it is responsible for directing and coordinating the various activities of the organisation. It is like the brain in a human body and the mainspring in a watch. It is the central directing force. The main purposes of an office are: (i) To direct and coordinate the activities of the various departments; (ii) To plan the policies of the business and ensure their implementation; (iii) To preserve all the records of the business; (iv) To handle inward correspondence; and (v) To maintain accounts, statutory and non-statutory books, etc., of the business. OFFICE FUNCTIONS The functions of a modern Office may be classified into two categories: I. Basic functions (or routine functions); and II. Administrative management functions. I. Basic Functions According to Terry,4 “the acts of collecting, processing, storing and distributing information comprise the basic functions of the office”. According to Mills and Standingford,5 “the purpose of the Office has been defined as the providing of a service of communication and record”; Denyer,6 however, says: “The basic functions of an office can be said to be receiving, recording, arranging (and analysing) and the giving of information”. In the work of any Office, be it sales, purchasing, personnel or even the drawing office, it will be seen that this is done most of the time. In fact, a leading spokesman of the Institute of Office Management has referred to the Office Manager as the “Information Manager”. The basic functions of an office may be analysed under the following headings: 1. Receiving Information: Information relating to the activities of an organisation may be received from a variety of sources, which may be internal sources or external sources. From internal sources, information may be received from various departments, sections or divisions of the organisation. From external sources, it may be received from suppliers, customers, visitors, other organisations, government departments, etc. Examples of the form in which information is normally received are letters, telephone calls, orders, invoices and reports on the various activities of a business. In addition to receiving such information as may come into the business, the office has the duty of obtaining any further information which the management may require. 2. Recording Information: The object of keeping records is to make information readily available to the management, whenever required. For this purpose, the information that is received, 4. George R. Terry, Office Management and Control. 5. Mills and Standingford, Office Organisation and Methods. 6. J.C. Denyer, Office Management. Chapter 1: Modern Office and Its Functions is converted into some form of written record. The records normally kept in a business office include financial and cost accounts, orders, progress of work, hours worked by employees, correspondence, etc. While some records are required to be kept by law, some others should be kept to meet the needs of the management in planning and controlling the business. The records so maintained by the Office serve as a reference library for future use. 3. Arranging Information: The information accumulated by an office is rarely in the form in which it is given out; facts have to be gathered from various sources and calculations, tabulations, etc., may have to be made. An office is responsible for supplying information in the form which best serves the purpose of the management, and this is a function of the highest importance and which must be carried out by a properly trained staff. Examples of arranging information are: preparing invoices, payrolls, cost accounting statements, statistical statements, and reports. 4. Giving Information: An office furnishes information from its records as and when it is required by the management. The information required by the management may be of a routine nature or of a special nature, and may be supplied verbally or in writing. Examples of giving information are orders, estimates, invoices, progress reports, statements of accounts, statistical and financial statements, and instructions issued on behalf of the management. All this work involves typing, duplicating, telephoning, mailing, teleprinting, etc. II. Administrative Management Functions Apart from the basic functions of an office, there are certain administrative management functions which have to be performed for a smooth functioning of the office. These functions are outlined beiow: 1. Management Functions: For the efficient functioning of an office, the management functions include: (a) Planning; (b) Organising; (c) Staffing; (d) Directing; (e) Communicating; (f) Controlling; (g) Coordinating; (h) Motivating. Office work has to be properly planned, and then organised and executed according to the plan. A proper control must be exercised over office activities, and the affairs of the different individuals and departments in the organisation must be coordinated. 2. Public Relations Function: An office has not only to maintain cordial relations with other departments in the organisation but also with outsiders. It has, therefore, to perform public relations function as well. Good public relations enhance the reputation and goodwill of the organisation. Public relations include the reception service, the liaison service, etc., provided by the organisation. Office Management 3. Instituting Office Systems and Routines: Systems and routines indicate a planned and systematic approach to the problem of management. A system may be regarded as a planned approach to the attainment of desired objectives.7 An office routine may be defined as a series of steps in the performance of Office Work, each step in the series being performed in the same order and in the same way every time.8 A procedure is a planned sequence of operations for the handling of recurring business transactions uniformly and consistently. 9 Office routines, systems and procedures, etc., should be developed to ensure an uninterrupted and smooth flow of Office Work so that it may be efficiently performed. 4. Retention of Records: Office records include correspondence, letters, invoices, orders. financial and cost records, reports, statistical records, minutes, etc. These records have to be retained for future reference. Apart from maintaining records, which is a basic function (see ‘Recording Information’ above under the heading “Basic Functions”), an Office has to perform functions like those of filing and indexing, and the preservations and destruction of outdated records. 5. Safeguarding Assets: It is the function of an office to safeguard the assets of the organisation, which may be fixed assets like building, plant, machinery, office equipment, lighting and air-conditioning equipment; or which may be movable assets like furniture, typewriters, calculating or accounting machines, equipment of various types; or which may be in the form of cash, title deeds, securities, records and documents, etc. Vital records such as major contracts must be properly protected; cash must be held in safety or banked; stock records must be properly maintained and deficiencies may be immediately brought to the notice of the management; fixed assets should be protected against hazards of fire and theft by taking out suitable insurance policies and by other means. 6. Form Designing and Control: Since office work is mostly paper work, office forms are extensively used to perform the recording function of the office. “A form is a standardised record which is used to accumulate and transmit information for reference purposes.” office forms serve as a store-house of information. It is the task of the management to design, standardise, produce and control the forms to be used in the Office as well as the other departments of the organisation. 7. Stationery and Supplies Control: Office Work requires the supply of office stationery of suitable quality and in adequate quantity. It is the duty of the office to carefully procure and maintain an adequate supply of stationery items. Since stationery is a very costly item these days, it should be bought at competitive prices in economic order quantities; reasonable levels of stock must be maintained and made available at all times; and it should be issued only against authorised requisitions and stored scientifically to avoid damage, loss or deterioration. 8. Selection and Purchase of Office Appliances: Office Work also requires adequate equipment and machines — furniture, fixtures, telephones, intercom systems, dictaphones, calculators, accounting machines, filing cabinets and drawers, typewriters, duplicators, (and, in some cases, computers), etc. It is the duty of the Office Manager to purchase the right type of machines, equipment or furniture (according to the requirements of the office), and also to maintain these in efficient working order. The principles which should be followed in the selection of office appliances include: 7. 8. 9. Littlefield and Rachel, Administrative Office Management. Leffingwell and Robinson, op. cit. Neuner and Keeling, Modern Office Management. Chapter 1: Modern Office and Its Functions (a) (b) (c) (d) (e) Full and proper use; Suitability for the purpose for which purchased; Simplicity of operation and maintenance; Flexibility and adaptability to different uses; and Analysis of cost and benefit. Appliances should be purchased, keeping in view the financial resources of the organisation. 9. Personnel Function: The efficiency of an Office depends on the personnel manning it. The personnel should be scientifically recruited and trained, and assigned work after a proper appraisal. The personnel function is performed by the personnel department, which is generally assisted by the office. The Office Manager must make a provision of adequate and trained staff to ensure the systematic, timely and efficient performance of Office Work. Job evaluation and merit rating should be periodically done; the staff should receive reasonable remuneration and should be properly motivated to attain the best performance. Opportunities for betterment and promotion should be made available to the Office staff. 10. Controlling Office Costs: With the adoption of scientific methods for Office Management, a modern Office is further supposed to discharge the function of “controlling Office costs”. This may be done by: (a) (b) (c) (d) Mechanisation of the Office; Adopting time and labour saving devices in the Office; Using better forms; Analysing the existing Office routines and adopting improved ones. Importance of Office An office is an important and indispensable part of every organisation, big or small. Be it a government institution, trading or manufacturing organisation, a hospital or an educational institution, an office is vital for its functioning. The office acts as a storehouse and nervous system of every operation of a business concern. A well managed Office is an indispensable aid to management. It helps the management to plan its operations intelligently and to put them in action competently. The office coordinates all the activities of the business. Without an efficient and organised Office, business activities cannot be carried through systematically. “The importance of the office to a business enterprise arises from the fact that a modern business, with its varied and complicated operations, cannot be managed efficiently without clerical assistance in some form or the other.” In fact, ‘competent clerical service is a precondition for the efficient conduct of business affairs’. It has been rightly said that “the office is to a business what the mainspring is to a watch”.10 Maynard11 has outlined the importance of the office in the following manner: (i) The Office is the locus of company policy — the place in which it is formed and from where it is executed. 10. LK Dicksee, Office Organisation and Management. 11. Maynard Handbook of Business Administration. Office Management (ii) The Office is the information hub of the company. It is the intelligence centre for the coordination of vital activities. Here is “memory” — on papers, cards, tapes and microfilm; in letters, reports, files and ledgers. Here is calculating and data processability. (iii) The Office is the company’s intermediary with customers, vendors and others outside the organisation. It bills, collects, pays and corresponds. (iv) The Office is an overseer of the office furniture, machines and supplies for all or most of the firm — buying, leasing, maintaining and replacing them. (v) The Office is the centre of the personnel function, supplying people for the workforce and setting standards of performance and compensation. (vi) The Office is the provider of other special services — offering to all divisions, in one way or another, methods, analyses, internal communication systems, copying and duplicating facilities, mass-feeding facilities, environmental controls, and much more. PR O D U C TI O N MA RK ET IN G OFFICE Collecting, Processing, Storing and Distributing Information FI NA N CE R PE SO NN EL Fig. 1.1 Office as Information Centre The importance of an Office to a business enterprise may be further studied with the help of the following points: 1. Office as Information Centre: An office may be described as the information centre of a business. It collects information from all sources, internal and external, records it, arranges and analyses it and provides it to the management when required. (See “Functions” above). The information furnished by an office helps the management to forecast and plan its operations well in advance and to exercise control over the entire spectrum of business activities. An office is also called a “storehouse of information” or a “memory centre of an organisation” since all kinds of information and figures, whether past or present, are available in the office. Chapter 1: Modern Office and Its Functions 2. Office as an Intermediary: An office connects different departments with the outsiders and vice versa. For instance, all the “purchase orders” are routed through the office and all the “sales orders” are received through the office. It is office that links the business organisation with its suppliers, customers, the Government and the general public. It is, in short, responsible for: (i) Attending to enquiries, orders and complaints of its customers and suppliers; (ii) Creating a good image of the organisation in the minds of people; and (iii) Maintaining liaison with the Government and other institutions. 3. Office as a Coordinator: The processing of information in a modern office may be grouped under four headings: namely, communications, written and oral; computing and summarising operating results; record-keeping through accounting and filing records; and systematisation and cost reduction — through systems and procedures analyses. These four activities are necessary for the efficient coordination of production, distribution, and financing of the merchandise or services in a business concern. This coordination is provided by the focal centre — the office. The process of coordination is almost impossible without an office, which provides competent clerical services to all in the business who need it. It keeps contact with all the other departments, and provides necessary information and knowledge for the coordination of the various activities of the organisation. 4. Office as a Service Centre: Since an Office is the focal point in a business organisation for the co-ordination of the work of production, distribution, finance and personnel, its activities are in the nature of services to all the other departments and to the business as a single unit. Frequently an Office is referred to as the Office services department. It exists to provide clerical and other services to the various departments, divisions, sections or branches of the organisation, and cannot operate apart from them. 5. Office as an Administrative Nerve Centre: As an inclusive executive function, an Office acts as an administrative nerve centre. It helps in making the decisions about the products to be manufactured and sold, when to purchase materials, what reports to prepare, and a variety of similar activities. It becomes the heart of all business activity, through which circulates information on purchases, sales, finances and communication. 6. Office as Control Centre: An Office also acts a “control centre” of the organisation, since it helps the management to take decisions and implement them. It prepares and presents all the necessary data, information and plans to the management so that it might take decisions. It is the Office where all the policy decisions originate, and it is from there that the activities of the organisation are controlled and remedial or corrective action taken to ensure that the objectives of the organisation are accomplished. Leffingwell, and Robinson12 have summed up the importance of an Office thus: “A well organised Office makes it possible for the management to plan its operations intelligently, to put its plans into effect surely, to follow their progress currently, to determine their effectiveness promptly, to appraise their result without delay and to coordinate all the activities of the business”. 12. A Textbook of Office Management.