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Fundamentals of Management
Some Important Terms To Know
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a) Business
b) Organization
c) Goals
d) Objectives
e) Strategy
f) Tactics
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Some Important Terms To Know
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a. Business
The term “Business” signifies individual & group activities directed towards wealth
generation through goods & services (recognized by the law).
Businesses offer goods and services to meet the needs and wants of the community.
Some Important Terms To Know
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b. Organization
A group of people working together in a structured and coordinated fashion to
achieve a set of goals is called organization.
Structure
Goals B
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Some Important Terms To Know
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c. Goals
Goals are the end results towards which all the activities are directed. Different organizations may have different
goals.
e.g. Profitability, Growth, Market Penetration, Productivity, Leadership, Client Satisfaction etc.
d. Objectives
Objectives are sub goals.
e. Strategy
A plan of action designed to achieve objective.
f. Tactics
A specific action to deliver on a strategy.
Management...
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Management is the attainment of organizational goals in an effective and efficient
manner through planning, organizing, leading, and controlling organizational
resources:
Managers get things done through the organization.
Managers create right systems and environment.
Organizations need good managers.
Coordination of the work activities of others so that their activities are completed
efficiently and effectively.
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Four Functions of Management
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Planning
Choose Goals
Controlling Organizing
Monitor & measure Working together
Leading
Coordinate
Planning
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Identifying goals for future organizational performance;
Deciding on the tasks and use of resources needed to be in the future
A Management function that involves Planning Process consists of five steps:
defining goals, establishing strategies for Objective-setting
achieving those goals, and developing Forecasting
plans to integrate and coordinate
activities. Strategy formation
Setting specific standards
Continual review and revision
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Organizing
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Reflects how the organization tries to accomplish the plan
Assign tasks to groups, individuals or departments
Delegate authority
Allocate resources across the organization
Organizing is the establishment of relationship Function of Organizing involves:
between: 1. Division of Labor
Activities 2. Departmentalization
Persons 3. Staff positioning
Physical factors 4. Assigning authority or Delegation of
or power
Structuring working relationships in a way that 5. Equalizing authority and responsibility
allows organizational members to achieve
organizational goals.
Leading
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To motivate employees to achieve organizational goals
Create a shared culture and values
Communicate goals to people throughout the organization
Infuse employees with the desire to perform at a high level
Management function that involves Components involve:
working with and through people to 1. Supervision
accomplish organizational task. 2. Motivation
In leading functions subordinates are 3. Communication
guided, supervised and motivated by
4. Bringing about change
managers.
5. Managing conflict
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Controlling
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Monitor employees’ activities
Determine whether the organization is on target toward its goals
Make corrections as necessary
Evaluate the performance
Management function that involves Process consist of:
monitoring actual performance, 1. Measuring
comparing standards, and taking
2. Comparing
corrective actions if necessary.
3. Correcting
Controlling Process
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SET MEASURE
DETERMINE
PERFORMANCE PERFORMANCE COMPARE
DEVIATION
STANDARDS
WITHIN
STANDARDS
LIMITS
TAKE
CORRECTIVE
NO YES
ACTION
CONTINUE
WORK
PROGRESS
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Organizational Performance
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Organizational effectiveness – providing a product or service that customers value
achieving a goal.
Effectiveness is the degree to which the organization achieves a stated goal, or
succeeds in accomplishing what it tries to do.
Organizational efficiency - amount of resources used to achieve an organizational goal.
How much raw materials, money, and people are necessary for producing a given
volume of output.
Doing the things right, or getting the most output from the least amount of inputs.
Productivity = Output / Input
Management Functions - Summery
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TWO PERFORMANCE DIMENSIONS
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High Performance – The ability to attain its goals by using resources
efficiently & effectively
Doing things right. Doing the right things.
What Do Managers Do? (Murray, 2010)
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Management Skills
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Three categories of skills:
Conceptual
Human
Technical
The degree of the skills may vary, but all managers must possess these skills
The application of management skills change as managers move up the hierarchy
Management Skills
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Conceptual Skill
The cognitive ability to see the organization as a whole system and the relationships among its
parts.
Conceptual skills help you to see how all the parts of an organization work together to
achieve the organization’s goals.
It involves knowing where one’s team fits into the organization and how the organization fits
into its environment.
People with conceptual skills are creative, and can work through abstract concepts and ideas.
Conceptual skills are extremely important for leadership positions, particularly upper- and
middle management.
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Management Skills
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Human Skill
The ability to communicate, understand and motivate both individual
and groups is called Interpersonal Skills or human skills.
The ability to work through other people and to work effectively as a
group member.
Management Skills
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Technical Skill
Job specific Knowledge and techniques in a specialized field is termed as
Technical Skills.
The understanding and proficiency in the performance of specific tasks.
Technical skills are specially input for first line managers.
These manager spend much of their time in training subordinates and answering
questions about work related problems.
They must know how to perform the task assigned to those they supervise if they
are to be effective managers.
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Relationship of Skills to Management
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Top Causes of Manager Failure
(Logenecker, Neubert, Fink, 2007)
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When Skills Fail
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Unethical behavior
During turbulent times, managers must apply their skills
Common management failures:
Not listening to customers
Misinterpreting signals from marketplace
Not building teams
Inability to execute strategies
Failure to comprehend and adapt to change
Poor communication and interpersonal skills
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Management Levels
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Management Types: Vertical
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Top managers are responsible for the entire organization
Middle managers are responsible for business units
First-line managers are responsible for production of goods and services
Management Types: Horizontal
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Functional managers are responsible for departments that perform a
single functional task and have employees with similar training and skills
Line Managers
Staff Managers
General Managers are responsible for several departments
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Management Levels at PEL
Chairman of BOD
Managing Director
Appliances Division Power Division Common Services
Director Operations Manuf acturing Finance
Manuf acturing Marketing Transf ormer Human Resources
General Manager National
Energy Meter IR & A
Ref rigerator LG Sales Manager
General Manager Marketing
Switch Gear Audit
Ref rigerator PEL Manager
Manager
General Manager R & D Marketing Inf ormation Technology
Corporate Sales
Sr. Man ag er Man ufacturing Manager
WAPDA
AC,DF & MWO Customer Services
Manager
Private
Foreign Procurement
Manager
Projects
Quality Control
EPC
Making The Leap: Becoming
A New Manager
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Organizations often promote star performers to management
Becoming a manager is a transformation
Move from being a doer to a coordinator
Many new managers expect more freedom to make changes
Successful managers build teams and networks
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Individual Performer to Manager
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Do You Really Want to Be A Manager?
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The increased workload
The challenge of supervising former peers
The headache of responsibility for other people
Being caught in the middle
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Manager Activities
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Adventures in multitasking
Activity characterized by variety, fragmentation, and brevity
Less than nine minutes on most activities
Managers shift gears quickly
Life on speed dial
Work at inflexible pace
Interrupted by disturbances
Always working (catching up)
Manager Roles
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Role: Set expectations for a manager’s behavior
Every role undertaken by a manager accomplishes
the functions of:
Planning
Organizing
Leading
Controlling
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Ten Manager Roles
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Informational (managing by information) Decisional (managing through
Monitor action)
Disseminator Entrepreneur
Spokesperson Disturbance Handler
Interpersonal (managing through people) Resource Allocator
Figurehead Negotiator
Leader
Liaison
Managing in Small Business and
Nonprofit Organizations
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Small businesses are growing
Inadequate management skills is a threat
The roles for small business managers differ
Entrepreneurs must promote the business
Nonprofits need management talent
Apply the four functions of management to make social impact
More focus on costs
Need to measure intangibles like “improving public health”
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Transition to a New Workplace
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State-of-the-Art Management
Competencies for Today’s World
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New Management Competencies
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Collaboration across functions, levels, customers, and companies
Experimentation and learning are key values
Knowledge and information sharing
More challenges and changes are on the horizon!
This is an exciting time in management.
Why Innovative Management Matters
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Rapid environmental shifts:
– Technology
– Globalization
– Shifting social values
Innovation is the new imperative.
Organizations cannot survive long-term without innovation
Companies like Facebook are always investing in new ideas
• In the new workplace, work is free-flowing and flexible at flatter structures.
• Success depends on innovation and continuous improvement
• Innovation should be a part of products, processes, people, and values.
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