Introduction

Organizations all have certain things in common.

These include:
 A goal or purpose
 Program or method for achieving the goals.
 Plans to ensure effectiveness of the goals.
 Leaders/Managers who are responsible for helping the organization achieve
its goals.

So the study of management involves the study of the work and performance of
managers i.e. how organizations are managed so that they can achieve their goals.

Definition of management
Several definitions of management have been advanced but because of the
complex nature of management no one definition has been universally accepted.

The simplest definition of management was given by Mary Parker Follet.

She defined management as "the art of getting things done through people".
From this definition we see that managers achieve organizational goals by
arranging for others the necessary tasks to be performed to achieve the goals of
the organization, hence they do not do the work themselves.

Management has also been defined as the process of planning, organizing,

leading and controlling the efforts of organizational members and using all
other resources to achieve stated organizational goals.
A process is a systematic way of doing things so management is systematic.
Planning means that the actions of managers are based on some method, or logic
organizing means that manager’s co- ordinate the human and non-human
resources in order to achieve goals.
Leading describes how managers direct and influence subordinates by
establishing the proper atmosphere for doing tasks. Controlling means that
managers select the right objectives i.e. select the right things to be done.
This definition says that management involves attainment of stated goals. This
means the manager’s work is aimed at specific goals or ends.

A third definition defines management as a process of grouping together

organizational material and human resource activities and directing them
to use the scarce resources efficiently and effectively in order to achieve
the organizational and individual goals and objectives.
Therefore, management work involves activity - managers do not sit around all day
and think. They talk, listen, read, write, meet, observe etc. However most of their
activities are either of planning, organizing, staffing, directing or controlling.
From the above definitions it is clear that management has the above
characteristics.
i. It is complex
Managers are engaged in many different activities. Sometimes they must do all
these activities concurrently or change them frequently.
ii. It is persuasive
It touches many areas and aspects of human activity. For example it is applicable
in many situations be they social, political or economic and it has enormous effects
on society. Management is also practiced in all institutions that involve group
work.
For management to be successful it must achieve both (efficiency and
effectiveness). But while efficiency is important, effectiveness is critical and no
amount of efficiency can compensate for lack of effectiveness.
If managers select the wrong objectives, then even if they minimize costs the
organizations will still fail. The key to successful management is therefore ability
to identify the right things to be done and to concentrate resources on them.

TYPES OF MANAGERS
There are many different types of managers with diverse tasks, responsibilities and
authority.
Managers can be grouped into two categories:
 By their level in the organization
 By their functional areas.

Management Levels
Using levels managers can be classified into top, middle and first line managers.
a) First Line Managers
Also called first-level or supervisory management. This is the lowest management
level in an organization. First line managers only direct operating employees.
Examples are Foremen, Office Managers, Supervisors and Department Managers.
These managers are the ones in the day-to-day contact with operating employees.
b) Middle Managers
These make up the largest group of managers in most companies. Their
positions extend from top management all the way down to those immediately
above first line management. Titles here include Plant Manager, Division Manager
and Operations Manager. They are the managers who implement the strategies
and policies set by top management and also co-ordinate the work of first-line
managers.
c) Top Managers
Top managers are those at the upper levels of the organization. They comprise of
comparatively small groups of executives who are responsible for the overall
management of the organization. They set the overall organizational goals and
determine strategy and operating policies. They also represent the organization to
other external environments e.g. governments. Titles here may include President,
Chief Executive Officer, Managing Director, General Manager, Chief Secretary etc.

Management By Functional Areas

Managers when differentiated by their areas of operation fall mainly under:
Marketing, Finance Operations and Human Resources.

a) Marketing
These are responsible for advising on pricing, promoting and distributing the firms
products and services. They conduct marketing research, plan advertising
campaigns, play a role in setting prices and oversee distribution systems.
b) Operations
These are responsible for actually creating the goods and services of the
organization. Other responsibilities for these managers include production control,
inventory control and plant layout.
c) Finance Managers
Are responsible for managing the Financial Assets of the organization. They
oversee the firms accounting systems, manage investments, control disbursement,
and maintain and provide relevant information to the CEO about the Financial
Health of the company.
d) Human Resource Managers (HRM)
These are responsible for determining future human resource needs, recruiting,
hiring, compensation, performance appraisal and ensuring that the various legal
guidelines governing employment are followed.

MANAGEMENT FUNCTIONS

The management functions are the separate parts (activities) that make up the
whole process of management. They can be described as the activities that are
inherent in most management jobs. Many of these activities can be grouped into
one of the following general functions.

a) Planning
Planning involves determining the organizations goals and the best ways of
reaching them. Plans permit:
 i. The organization to obtain and commit the resources required to reach its
objectives.
ii. Members of the organizations to carry on activities in line with the
chosen objectives.
iii. Monitoring of progress towards the objectives with view of taking
corrective action.

b) Organizing
This is the second basic managerial function and it is the process of grouping
activities and resources in a logical and appropriate fashion. Basically it is creating
the organizational chart for a firm. (Determining the structure of the organization -
the jobs to be done, who is to do them, how the jobs are to be grouped, how much
authority each manager is to have and how many employees each is to supervise).
c) Leading
This is the set of processes associated with guiding and directing employees
towards goal attainment. Attempt to assure that the organization is moving
towards its goals. It includes motivation, leadership and communication.
d) Controlling
This is the final basic management function and it is the process of monitoring and
adjusting organizational activities towards goal attainment.

Successful management
Successful management involves the achievement of both efficiency and
effectiveness.
Efficiency means that resources are used in such a way that they are not wasted.
Having employees sitting idle waiting to be allocated work is an example of
inefficiency. Another example is allowing large surpluses of funds to sit idle in
bank accounts earning little interest.
Effectiveness means doing the right things in the right way at the right time. For
example entering a new market just before it starts to expand or exiting from a
market just as it starts to decline is a sign of effectiveness.
Effectiveness is solution oriented. Successful management means a successful
organization.
Organizations function within the larger society and the performance of
organizations in totality is a key factor to the performance of a society or Nation.
Another efficient manager is one who achieves outputs that measure to inputs i.e.
he is able to minimise the cost of resources.

MANAGEMENT ROLES AND SKILLS

MANAGEMENT ROLES
Henry Mintzberg analysed how managers spend their time and came to the
conclusion that there are three basic roles that managers play:- interpersonal
roles, informational roles and decisional roles.
a) Interpersonal Roles
There are three interpersonal roles in the manager's job. The first is that of
Figurehead. As head of a unit the manager puts in an appearance as the
representative of the organization by performing certain duties or ceremonies e.g.
attending an employee’s wedding, welcoming guests etc.
The second role is that of leader. As a leader the manager hires employees, trains,
motivates and encourages them to perform better.
Third the manager plays the interpersonal role of liaison, which involves dealing
with people outside the organization on a regular basis e.g. bankers, suppliers or
clients.
b) Information Roles
According to Mintzberg receiving and communicating information are perhaps the
most important aspects of a manager’s job. First he must act as a monitor i.e. he
actively watches the environment for information that might be relevant to the
organization.
Secondly the manager must act as a disseminator by relaying the information that
he has gathered through monitoring to the appropriate people in the organization.
Third he must act as the spokesman of the organization by presenting information
of meaningful content and/or answering questions on the firm’s behalf. You
probably have seen leaders answering questions from the press about issues
relating to their organizations or defending their organizations against criticism or
allegations levelled against them.
c) Decisional Roles
These are the roles that managers take when they make decisions about certain
issues. Under the decisional roles the manager acts as the entrepreneur by looking
for opportunities that the organization can pursue to improve itself e.g. a profitable
investment.
Second the manager acts as the disturbance handler by resolving conflicts
between employees and responding to situations beyond him/her control e.g.
strikes, bankrupt customers, breach of contract etc.
Third the manager must act as a resource allocator by being responsible for
deciding how and to whom the resources of the organization and the managers
own time will be allocated.
Fourthly the manager plays the decisional role of a negotiator. In this role the
manager attempts to work out agreements and contracts that operate in the best
interest of the organization.

Note:
The functional definition of management as a process of planning, organizing,
leading and controlling is somewhat oversimplified according to Mintzberg.
Managers do much more than the four basic functions contained in the definition.
Mintzberg's work calls attention to the uncertain, turbulent environments in which
the manager operates.

MANAGEMENT SKILLS
Skills is what separates good managers from others. Like a player in any game, the
more skilful a manager is, the greater are his chances of success. Most scholars
and writers agree that for effective management the primary skills are technical,
interpersonal, conceptual and diagnostic.
a) Technical Skills
They are the skills needed to perform specialized tasks. They enable one to use the
tools, procedures or techniques of a specialized field. These skills are gained
through formal training. These skills are especially important for First line
managers as they are the ones in the real operations of the firm.
b) Interpersonal (Human Skills)
These are the skills needed to enable one to work with, understand and motivate
others, either as individuals or as groups. They include the ability to understand
someone else's position, to present one’s own position in a reasonable, amicable
manner. The better a manager's human skills are, the more effective he/she is
likely to be, since management is basically getting work done through people.
c) Conceptual Skills
These relate to the managers mental ability to coordinate and integrate all the
organization's interests and activities i.e. to be able to think in the abstract, to see
relationships between forces that others cannot see and to take a global
perspective of the organization and its environment. For example if a manager
recognises an opportunity that others have not and then successfully exploits that
opportunity he is drawing on conceptual skills. Conceptual skills are most
important for top managers who must look for opportunities to be exploited by the
organization.
d) Diagnostic Skills
The skills used to define and understand situations and events. They are mainly
directed at problem solving. For example, if a manager notices there is too much
waste in production, the first step is to define the problem, next determine what is
causing the problem and third identify way(s) of solving the problem.

Note:
Although all the skills are essential for effective management, their relative
importance depends on the level of each manager.
Technical skills are more important at the lower levels of management and they
get less important as you climb up the managerial ladder.
While human skills are needed at all levels of management, they are probably most
important at the supervisory level where manager—subordinate interactions are
more frequent.
Conceptual skills are most important at the top management level where the
managers are involved in broad issues concerning the whole organization.

MANAGEMENT ART OR SCIENCE

Most scholars feel that management draws on both art and science.
Follet for example defined management as an art, but her definition is not
universally accepted. What is obvious is that like most other arts management
involves some degree of skill.
Another man Henry M. BoeHinger who was a corporate officer and management
lecturer argues that management is an art. It requires the components of most arts
like poetry or painting. i.e. vision. In the respects advanced by Follet and
BoeHinger management is an art.
Management has also been studied for a long time and has been systematised into
a body of theories. This systematism gives management some scientific elements.
Scientific management can be defined as the use of modified and verified
knowledge in the planned management of any organized activity, management, as
we know it is far from this despite the valid predicability that has been introduced
to management by introduction to computers.
Management can also be considered an art as it is subjective, non-statistical,
emotional, common sensical and behavioral. There is considerably more to learn
about people and social structures of an organization and therefore managers tend
to depend on subjective human judgment in most instances making management
an art despite other aspects being scientific.

THE ENVIRONMENT UNDER WHICH MANAGEMENT IS PRACTISED

Organizations do not operate in vacuums rather they operate within the setting of
a larger system which constitutes the environment.

Definition of Environment
Environment generally refers to the surroundings, circumstances and influences
on individuals or organizations. The effects of the environment can either be
positive (i.e. beneficial) or negative (i.e. cost/constraints)
Although constitutionally the power of managing organizations rests with
management, which should use its ability to make decisions, in real life this is not
always possible because the environment exerts pressure on management. These
pressures are what are referred to as environmental constraints.
The environment has also been defined as the aggregate of socio-cultural,
economic, and physical conditions that influence the life of an individual,
organization or community. No enterprise of any kind can operate in the absence
of environmental constraints, or restrictions imposed by the organizational
surroundings. While managers exercise power their authority is always limited by
the environment, of necessity then, all enterprises must adjust to the environments
in which they exist.
Every organization has two types of environments: Internal and External
The External Environment
The external environment of an organization, also sometimes called its general
environment consists of those factors that are outside the control of the manager
(external to it) but which nevertheless affect managerial decision-making.
The external forces generally affect all organization within that society so they are
not specific to any one organization.

Social and Cultural environment

The business operates within a social framework. Four aspects of this are relevant.

 Power: - who has it how effective is it and how is it used.

  Leadership:- who are the leaders and what are their weaknesses and
strength.
 Culture:- the value s and traditions within which the business must operate.
One problem forcing multinational has often been failure to cope with the
different cultural values of the countries within which they operate.
 Risk:- attitudes towards risks and risk taking can be risk averse or seekers.
 The organisation is influenced by changes in the nature, habits and attitudes
of society: -
 Changing values and lifestyles eg. flexible working hours, internet access
and other IT devices that allow people to shop on line
 Changing beliefs
 Changing patterns of work and leisure
 Demographic changes.
 Changing mix in the ethnic and religious background of the population.

The social environment also covers the study of population trends. The manager
will make use of such trend to determine the size, type and location of the market
place for products or services.
 Size: Expected growth or decline on the national and international
population affects the markets size.
 Type: Changes in the age distribution affects the product or services to be
offered.
 Location: The expected drift of population into different parts of the country
affects the channels of distribution.
 Demographic changes can have negative impact on demand. Falling birth
rates could indicate problems ahead for producers and sellers of baby
products later.
 Emigrating population can reduce demand on a local basis.
 Culturally changes in tastes and fashion can have a damaging effect on
organisations that fail to anticipate the changes eg. Clothing.

Legal environment
It is concerned with how an organization does business and covers:-
 Law of contract i.e. validity of contract.
 Sale of goods Act – selling practices
 Health and safety legislation for example in UK there is an Act that governs
health and safety at the workplace. It covers the working condition and the
preventive measures that an employer should put in place.
 Employment Act: How an organization treats its employees.

 Legislation on competitive behaviour – Law of Tort.

 Law of Tort: Negligence, Auditor’s and management liability.
 Environmental legislation: Pollution control such as waste management.
 Company’s Act in Kenya Cap 486
 Tax Act Cap 470
Changes in the law can affect the organisation in many ways for example a
tightening of health and safety legislation may increase costs. Premises
failing to meet standards may be closed down.
  A particularly damaging change is the complete ban on a company’s product
and this could be worse if the company had not diversified enough its
product portfolio. This is what BAT (K) Ltd is facing as many international
organisation press on for a total ban on marketing of tobacco products.

The economic environment

The current state of the economy can affect how a company performs. The rate of
growth in the economy is a measure of the overall change in demand for goods and
services, Other than economic influences include:-
 Taxation levels
 Inflation rate
 Balance of trade and exchange rates
 Level of unemployment interest rates and availability of credit
 Government subsidiesOne should also look at international economic issues:-
 The extent of protectionist measures.
 Comparative rates of growth, inflation, wages and taxation
 Freedom of capital movement
 Economic agreement in various trading blocs such as the EU, COMESA.
 Relative exchange rates.
 A downturn in the economy can lead to corporate failures across a number
of sectors. The worst hit are suppliers of goods with high income elasticity
demand eg. house builders like Housing Finance.

Deflationary government fiscal policy (low government spending, high taxation and
a planned budget surplus) and central bank monetary policy

High interest rates, restrictions on money supply expansion and revaluation of

currency can adversely affect a business. This is because they influence demand
for goods both domestically and internationally, cost of capital and the level of
profitability which in turn affects dividends and retained earnings level.

Political environment
The origin must react to the attitude of the government. The organisation must
react to the new attitude of the government of the day. The government is the
nation’s largest consumer, employer and investor and any changes in the spending
priorities will have a significant impact on a business.
Political influence will include legislation on trading pricing, dividends tax,
employment, privatisation, development of free market influences and
unemployment.
Economic forecasts are normally prepared on the basis that the existing
government policies continue. Other factors are political stability in a country,
which will influence the rate of investment in the country.

Technological environment
This is a rapidly changing area and organisations should be very careful with it. It
can influence the following:-
 Changes in production techniques e.g. the use of robots, Computer Aided
Manufacture
 Products that are made or sold e.g. software
  How services are provided. ATMS for banks
 How to identify markets creation of customer databases.

Much has been made of the application of new technologies to communications

and business especially the Internet.
The impact of information as the raw material in a knowledge-based economy is
huge. Within an industry failure to exploit information and new production
technology can lea to an organisation failing behind its rivals and losing its
competitive edge.
The distribution of services has change and there has been removal of entry
barriers in certain industries such as banking and insurance. Much lower start up
costs has created threats to the established players, which if they do not respond
to, could lead to decline.
New technology leads to innovation of substitutes for example in the
pharmaceutical industry, biotechnology and data storage devices.
Examples of changes in production processes includes use of robotics and
computers. This has led to lower cost of production, better quality goods or both.

Internal Constraints
The following are constraints that originate from within the organization but which
management must take care of.

i. Constraints imposed by organizational charters and guidelines

Many organizations such as government agencies, religious bodies and
corporations have written documents which constitute corporate charters, by-
laws, policies, rules, constitutions etc. These documents spell out what the
organization can or cannot do and managers in these organizations are limited
by what these documents say.
ii. Constraint imposed by organizational policies, procedures, rules and strategies
These predetermined plans place limits on what an organization can or cannot do
e.g. policy specifying that all sales be to wholesalers tells managers that sales will
not be made to ultimate consumers at all, or rules against members of the same
family working in the same organization.
iii. Constraints imposed by limited money and personnel
No organization has unlimited capital. Because of insufficient funds, managers
may be unable to hire the best qualified people, purchase the best equipment and
land and so forth. Therefore the organization will be restricted in what actions it
can take. Managers may also be limited by the personnel (employees) within the
organization who may not have the necessary skills or knowledge to carry out
planned activities. Employees may also resist changes that affect them in the
organization.
iv. Constraints imposed by higher level management
Policies, procedures and rules such as noted above are developed by higher level
management. In addition higher level managers develop the strategies that direct
the actions of other members of the organizations. The actions of higher
management can therefore limit the actions of the lower level management.
v. Constraints imposed by custom and culture.
Custom is defined as long established, continuous, reasonable and constant
practices considered as unwritten law and resting for authority on long consent.
Custom defines the unique ways of how things have always been done in the
organization.
vi. Constraints imposed by stockholders and Boards of Directors
Shareholders have the opportunity to influence a company by exercising voting
rights.

Note:
The five elements of the external environment (i.e economic socio-cultural,
political, legal, international and technological) affect the organization indirectly.
Managers should monitor the indirect action factors for early warning signs of
change that might later affect the organization.
Managers can only adjust to the external environment through the planning
process, or by changes in the formal organization structure i.e through flexibility
which involves a conscious structuring of the organization so that it will best meet
the demands of the environment at any given time.
The direct action factors of the environment consists of the organizations
stakeholders i.e. the groups which have direct impact on the organization. These
are either internal like employees, shareholders and the Board of Directors or
external like customers, suppliers, competitors, labour unions, financial
institutions, the media and competitors. Managers need to balance the interest of
all those stakeholders for the good of the organization. This can be done through
such actions as (advertising, lobbying and collective bargaining).