Principles and practices of management:
12-03-26
Management is the process of planning, organizing, leading and controlling the efforts of
organization members and using all other organizational resources to achieve stated goals.
The efficiency vs. effectiveness rule:
Efficiency: doing things right (minimize waste)
Effectiveness: doing the right things (achieving the goal)
Goals of management:
1- Sustainability and growth:
Maximum productivity
Resource optimization
Organizational growth
Social benefit
2- Essential skills for manager:
Technical skills
Human skills
Conceptual skills: ‘big picture’ ability to see how parts of the organizational fit together.
Soft skills required:
Interpersonal: require high emotional intelligence (EQ) and communication
Information rules: require analytical skills and networking
Decisional roles: require strategic thinking and risk management
- Functional areas of management:
Production
Marketing
Finance
Human resources
IT/ operations
If marketing promises a new feature to customers, production must be able to build it,
Finance must fund it, and HR might need to hire specialist to design it
- Issues and challenges in modern management
Globalization
Digital transformation
Remote/ hybrid work
Sustainability and ethics
Mental health
- Importance of management:
Achieving group goals
Increase efficiency
Createsa dynamic organization
Achieving personal objectives
Development of society
Innovation and growth
Organisation:
Structured group of people working together to achieve a specific set of goals.
The three pillars of an organisation:
Purpose- people- structure.
Organisation culture:
Values: what organisation stands for?
Beliefs: how things work?
Norms: unwritten rules of behaviour
Artifacts: office layouts
Organisation environment:
The sum total of all external and internal factors that influence how a business operates
*Internal environment: (controllable)
Value system
Mission and objectives
Human resources
Physical assets
*External environment: (uncontrollable)
Micro (immediate impact); customers, suppliers, competitors, marketing, intermediaries
Macro (broad impact); PESTEL
PESTEL stands for: political, economic, social, technological, environmental, and legal
Culture in action:
Innovation and risk
Attention to details
Outcome orientation
People orientation
Stability
Aggressiveness
Team orientation
Wednesday 18-03-26
F.W. Taylor
4 principles of scientific management:
Science, not rule of thumb
Harmony, not discord
Cooperation, not individualism
Maximum output, not restricted output
Key techniques used by Taylor:
Functional foremanship and standardisation
Method study
Motion study
Time study
Fatigue study
Henri Fayol: administrative theory
14 principles of management:
division of work, authority and responsibility, discipline, unity of command, unity of
direction, subordination of individual interest, remuneration (income and money),
centralization (delegation), scalar chain (chain of authority/solution), order, equity, stability of
tenure, initiative, esprit de corps (team spirit).
Theory of bureaucracy (Max weber)
Replace “favouritism” and “emotional management” with a system based on logic and
technical competence
. division of labour
. formal hierarchy
. formal rule and regulation
. Impersonality
. career orientation
The simple definition of management: the art of getting things done effectively and
efficiently.
Modern era theories:
Human relations movement:
Experiments conducted by Elton mayo at western’s electrics Hawthorne plant between 1924
to 1932
Initially tried to see if physical changes (like better lighting) increase productivity.
Discovered that productivity went up regardless of whether the lights were bright or dim
Workers performed better because they felt important and noticed by the researchers.
Contingency theory: there is no one best way to manage an organisation
Most effective leadership style or structural design depends or is contingent on the specific
internal and external environment
Analytical and adaptive
Planning and Forecasting
Planning- the process of setting objectives and determining the specific actions needed to
achieve them. It is proactive and initiative.
Forecasting- it is the process of predicting future conditions based on past and present data. It
is analytical and predictive, meaning you don't need to control a forecast; you react to it.
Forecast tells you that it might rain the plan tells you to bring an umbrella and if forecast is
wrong, the plan fails.
Span of Management
- Also called span of control
- Refers to number of subordinates who report directly to a single manager or
supervisor
What determines the right span?
- Complexity of work
- competence of staff
- managers capability
- standardization (SOP)
Controlling process - measuring plans
- Established standards and objective
- SMART which stands for:
- S- Specific
- M- measurable
- A- achievable
- R-relevant
- T- time Bond
- Measure actual performance.
- Compare performance against standards.
- Management by exception which means leaders only step in when deviation is significant.
- Take corrective actions.
Hospital Goals
1. Reduce Mortality
2. Use advanced technology
3. Minimize errors
4. Upgrading
Communication and Spontaneity
Communication- Expression of thoughts between at least 2 people, it can be verbally or non-
verbally, to answer questions, give information, creating a bond, feel emotions, to build a
shared understanding
Importance:
- Builds trust and transparency
- Encourages innovation and creativity
- Resolves conflicts quickly
- Boosts employee engagement
Spontaneity:
- Fosters adaptability and responsiveness
- Encourages open dialogue
- Helps in crisis management
Effective managers:
- Communicate clearly and openly
- Encourage spontaneous feedback
- Lead by example (be approachable)
Decision making theories:
1- The rational model (the ideal way)
This model assumes managers are perfectly logical, have all the facts, and always choose the
option that maximizes value. It follows a step – by – step linear process
The process: define the problem, identify criteria, weight criteria, generate alternatives, rate
alternatives, pick the best one
The reality: it’s rarely possible to have perfect information.
2- Bounded rationality (the satisficing way)
Satisficing: a blend of the words satisfy and suffice
Coined by Nobel prize winner Herbert Simon
Managers don’t have the time, money, or brainpower to find the perfect solution
They pick the first option that meets their minimum requirements