Introduction:

The study of Organization theory was instigated by the Industrial Revolution. Industrial revolution united all independent craftsman into a union to assist the mass production. The concept of mass production was first studied and popularized in 1776 Adam Smith (1995).

Organization theory is a difficult abstract to understand unless someone has a reason to study it. Many would think of it as a dry and boring subject to study. But there any many reasons behind to consider it as an significant part of the theories involved in the management. Many of the valid reasons instigate to study deep about the theories pertaining to organization. For some it would be like a process to understand the organization or could be just a curiosity. For other, it could stretch the imagination and study the integration of sciences, humanities and the arts into the contribution to the study of an effective organization. Some would just consider as reference in their efforts to become a successful executive in an organization. There comes out to be many reasons in understanding the true potential of organization theory.

In order to find the true potential of the abstract theories and its applications, it would be good enough to derive the conclusions from the literature that have contributed to the organizations. This review would take into account theories and their relevancy to the study of organizations. These theories would provide the insights of working with an organization.

WHAT IS ORGANIZATION THEORY?

The notion of distribution of labor acted as the motivating factor in deriving many theories in the study of organizations. There are four concepts that makes up the concept of distribution of labor: 1) hierarchy of authority, 2) span of control, 3) centralization versus decentralization and 4) specialization of function or task. During the course of