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There are many reasons why organisations exist:
§ They satisfy social needs, e.g. the companionship of people with similar tastes leads to the formation of clubs, societies and unions. People join organisations because they consider that they will be more secure, more successful, have more needs and wants satisfied and be better off.
§ Organisations exist primarily because they are more efficient at fulfilling needs than individuals who attempt to cater for all their requirements in isolation and without assistance from others. The main reason for this is the ability that organisations have of being able to employ the techniques of specialization and the division of labour. In particular:
§ They save time – a group can accomplish a task more quickly than lone individuals.
§ They pool knowledge – members of organisations can share knowledge and skills.
§ They are power centres – an individual rarely has the power to influence events on a large scale whereas most organisations can influence demand, win orders and create wealth.
