Understanding Management Principles
Understanding Management Principles
Definitions
According to Harold Koontz, "Management is the art of getting things done through and
with people in formally organised groups."
According to Henri Fayol,"To manage is to forecast and to plan, to organise, to command,
to co-ordinate and to control."
According to Peter Drucker, "Management is a multi-purpose organ that manages business,
managers and workers and work."
According to Mary Parker Follet, "Management is the art of getting things done through
people."
Meaning of Management
Management - is the process of reaching organizational goals by working with and through
people and other organizational resources.
Objectives of Management
The main objectives of management are: -
1. Getting Maximum Results with Minimum Efforts –
Management aims at securing maximum outputs with minimum efforts & resources.
2. Increasing the Efficiency of factors of Production
Efficiency can be increased through proper utilization of various factors of production.
This is achieved by: -
i. Reducing spoilage,
ii. Reducing wastages and
iii. Reducing breakages of all kinds,
This leads to saving of time, effort and money.
3. Maximum Prosperity for Employer & Employees –
Management ensures smooth and coordinated functioning of the enterprise.
This in turn helps in providing maximum benefits to: -
Employer
Management provides maximum benefits to employer in terms of higher profits
Employee
Management provides maximum benefits to employee in terms of: -
Good working condition,
Suitable wage system,
Incentive plans
4. Human betterment & Social Justice –
Management ensures ; -
The uplifting and betterment of the society.
Better standards of living for the society- through increased productivity & employment.
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It provides justice through its uniform policies.
Importance of Management
1. It helps in achieving group goals –
Management : -
i. Arranges the factors of production,
ii. Assembles and organizes the resources,
iii. Integrates the resources in effective manner to achieve goals.
2. Ensures optimum utilization of resources –
Management utilizes physical, human and financial resources productively.
This leads to efficacy in management.
3. Reduces the Costs of production –
Management uses physical, human and financial resources using minimum inputs & getting
maximum output.
This helps in cost reduction.
4. Establishes sound organization –
No overlapping of efforts (smooth and coordinated functions).
Management establishes effective authority & responsibility relationship i.e.
Who is accountable to whom,
Who can give instructions to whom,
Who are superiors
Who are subordinates?
Management fills up various positions with right persons, having right skills, training and
qualification.
All jobs should be cleared to everyone.
5. Establishes equilibrium –
Management enables the organization to survive in changing environment.
It keeps in touch with the changing environment for growth and survival of organization.
6. Essential for prosperity of society –
Efficient management leads to: -
Better economical production which improves the welfare of people.
Avoids wastage of scarce resource.
It improves standard of living.
It increases the profit which is beneficial to business and society.
Creates employment opportunities.
Organization comes with new products and researches beneficial for society.
Need of Management
1. Direction, coordination and control of group efforts
2. Orderly achievement of business objectives
3. Performance of basic managerial functions
4. Effective communication at all levels
5. Motivation of employees
6. Success and stability of business enterprise
Nature of Management
Management is both an Art & science
Management involves characteristics of both art and science.
Management is Science because: -
It has universally accepted principles,
It has cause and effect relationship etc.
Management is an Art because: -
It requires perfection through practice, practical knowledge, creativity, personal skills etc.
Management as an Art
Art implies application of knowledge & skill to trying about the desired results.
It is the application of general theoretical principles for achieving best possible results.
Management as Science
Science - is a systematic body of knowledge pertaining to a specific field.
It contains general facts which explains a phenomenon.
It establishes cause and effect relationship between two or more variables.
It underlines the principles governing the relationship between variables.
Management as Profession
A profession - may be defined as an occupation that requires specialized knowledge and
intensive academic preparations.
Essentials of a Profession
The essentials of a profession are:
1. Specialized Knowledge –a manager must have devotion and involvement to acquire expertise
in the science of management.
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2. Formal Education & Training –Many institutes of management have been set up for
imparting education and training.
3. Social Obligations – actions of Professionals are influenced by social norms and values. A
manager is responsible not only to its owners but also to the society. A manager is therefore
expected to provide quality goods at reasonable prices to the society.
4. Code of Conduct – managers have a prescribed a code of conduct for managers which a
manger should not violate.
MANAGER:
Manager is also known as leader & administrator.
Manager - is a person who under take the tasks and function of managing an organization at
any level.
It is a person whose primary activities are a part of the management process.
Classification of Managers
Managers can be classified in two ways: -
1. By their level within the organization
2. By the scope of their responsibilities.
Levels of Management
There are three basic levels of management:
These are: -
1. Top-level Management
2. Middle-level Management
3. First-Line Management
Scope Responsibility
of Manager
1. Functional They are responsible for departments that perform a single
Managers functional task.
They supervise employees with specialized skills in a single area
of operation e.g. accounting, manufacturing etc.
2. General They are responsible for the overall operation of an organization.
Managers It may be a company or a division.
3. Project They coordinate employees across several departments to
Managers accomplish a specific project.
They also have general management responsibility.
Managerial Roles:
The main roles of a manager are: -
1. Interpersonal Roles
2. Informational Roles
3. Decisional Roles
Roles Described by
Interpersonal The Figurehead Role:
Roles: Every manager must perform some duties of a ceremonial nature e.g. the sales
Involves basic manager takes an important customer to lunch).
interpersonal The Leader Role.
relationships This role involves leadership directly.
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The manager is responsible for hiring and training his own staff.
The Liaison Role,
The manager makes contacts inside and outside the organization with a wide
range of people: subordinates, clients, business associates, government, trade
organization officials, etc.
Informational The Monitor Role:
Roles: This role involves seeking current information from many sources.
Processing of The Disseminator Role:
information Managers pass information to other, both inside and outside the organization.
The Spokesperson Role.
Managers send some of their information to people outside the organization
about company policies, needs, actions, or plans.
Decisional Roles: The Entrepreneur Role:
decision- Managers search for improvement his unit to adopt it to changing conditions in
making the environment.
The Disturbance Handler Role:
Managers resolve conflicts among subordinates or between manager's
department and other departments.
The Resource Allocator Role:
Managers make decisions about how to allocate people, budget, equipment, time
and other resources to attain desired outcomes.
The Negotiator Role.
Managers make formal negotiations and bargaining to attain outcomes.
Managerial Skills
Managers need to possess the following managerial skills: -
1. Technical skills
2. Human skills
3. Concept skills (Conceptual skills)
4. Design skills (Diagnostic Skills)
5. Political skills
1. Technical Skills
Technical skills - reflect an understanding of a specialized field and a proficiency in it.
They are skills necessary to accomplish specialized activities e.g. engineering, accounting, etc.
2. Human Skills
Human skills – give the manager the ability to work well with others.
Human skills enable the manager to: -
Communicate with others
Understand others
Motivate both individuals and groups.
5. Political Skills
Political skills - is the ability to acquire the power necessary to reach objectives and to prevent
others from taking power.
Political skill can be used for the good of the organization and for self-interest.
Note
The Skills vary at different levels:
Top management - Concept, design Skills & political skills
Middle - Human Skills.
Supervisors - Technical skills.
Management
Management - is an art of getting things done through & with the people in formally organized
groups.
Status
Management Administration
It constitutes the employees of the It represents owners of the enterprise who
organization who are paid remuneration earn return on their capital invested &
(salaries & wages). profits.
Managers Leader
1. The manager administers The leader innovates.
2. The manager is a copy The leader is an original.
3. The manager maintains The leader develops.
4. The manager focuses on systems and structure. The leader focuses on people.
5. The manager relies on control The leader inspires trust.
6. The manager has a short-range view The leader has a long-range perspective.
7. The manager asks how and when The leader asks what and why.
8. The manager has his or her eye always on the The leader’s eye is on the horizon.
bottom line
9. The manager imitates The leader originates.
10. The manager accepts the status quo. The leader challenges it.
11. The manager is the classic good soldier The leader is his or her own person.
12. The manager does things right; The leader does the right thing.
Management Process
The figure below shows the management process.
Contributor George & Jerry Henry Fayol Luther Gullick Harold Koontz
Functions Planning Forecasting He gave a keyword Planning
Organizing Planning POSDCORB where: - Organizing
Actuating Organizing P = Planning Staffing
Controlling”. Motivating O = Organizing Directing
Coordinating S = Staffing Controlling
Controlling D = Directing
Co = Co-ordination
R = Reporting &
B = Budgeting.
1. Forecasting
Forecasting - is the process of looking forward which is based on past performance, current
analysis and future trends.
2. Planning
A plan - is a future course of actions.
It bridges the gap from where we are & where we want to be.
Planning - is determination the courses of action to achieve desired goals.
Planning is deciding in advance –
What to do
When to do &
How to do.
Planning involves: -
Choosing tasks that must be performed to attain organizational goals,
Outlining how the tasks must be performed, and
Indicating when they should be performed.
3. Organizing
Organizing - is the assigning of the tasks developed in the planning stages to individuals or
groups within the organization.
4. Directing
Directing - is also known as: -
Motivating
Leading or
Influencing.
Directing - deals with guiding and instructing people to do the work in the right manner.
It deals with guiding the activities of the members of an organization in the right direction
towards the fulfillment of the goals.
Directing involves: -
i. Leading the subordinates
ii. Supervision of the subordinates
iii. Raising the morale of subordinates
iv. Motivating the morale of subordinates
v. Communicating to the subordinates
5. Controlling.
Controlling - ensures that everything occurs in conformities with the expected standards.
Controlling helps to predict deviations before they actually occur.
Steps of Controlling
Controlling involves these broad aspects: -: -
i. Establishment of standard performance
ii. Measurement of actual performance
iii. Comparing present performance (actual performance) to pre-established performance
(planned performance) and finding out deviation if any.
iv. Corrective action - determining the next action plan and modifications for meeting the
desired performance Corrective action.
6. Co-coordinating
Coordination - brings the integration of activities of different departments.
Coordination is essential for orderly working of an Organisation
It deals with harmonizing different work sections in an organization in order to achieve
common goals.
Importance of Coordination: -
i. It gives one clear-cut direction to the activities of individuals and departments.
ii. It avoids misdirection
iii. It minimizes wastages
iv. It brings unity of action.
7. Staffing
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Staffing - refers to the manpower required for the execution of a business plan.
Manpower is the most important asset of a business unit.
Staffing involves: -
i. Estimating manpower requirement
ii. Recruitment, selection & placement
iii. Training & development.
iv. Remuneration.
v. Performance appraisal.
vi. Promotions & transfer.
8. Communicating
Communications- is the process of passing information, experience, opinion etc. from one
person to another.
It is a bridge of understanding.
Managers should be good communicators.
Autocratic or Despotic
This is management which commands and expects compliance from its employees.
It manages by the ability to withhold or give rewards and punishments
It is also referred to as Authoritative Management.
Although they listen to the opinions of subordinates before making a decision, they make
decisions without considering the opinions.
Advantages
1. Motivation and reward for leaders: - It provides strong motivation and reward for the leader.
2. Quick decision: - Quick decision making is guaranteed because single person decides for the
whole group.
3. Individual decision making: - subordinates are not involved in decision making process.
4. No initiative: - Decision making, planning or organizing need no initiative.
5. Strong chain of command: - Strict control and establishment of chain of command is possible.
Democratic or Participative
Participative Management - consults with subordinates on proposed actions and decisions
and encourages participation from them.
It is also referred to as Consultative Management
This Management: -
Consulting with subordinates
Considers the opinions of subordinates
Support subordinates in accomplishing their duties.
Advantages
1. It fits almost every business - As they involve engaging team members, effective processes
that will fit almost every business will be maintained.
2. It often has solutions for complex problems - It encourages innovation, so solutions to
strategic and complex problems will be found.
3. It promotes a creative environment – It fosters a creative environment by encouraging
innovation and input among team members.
4. It builds strong teams - team members tend to be supportive and strong.
Disadvantages
1. It tends to become apologetic - leaders will have to take some of their time to apologize and
smooth things out with members whose ideas were not implemented.
2. It is time-consuming - The consultation process could result in procrastination, which means
that leaders cannot work within a required timeframe, which can be bad for urgent projects or
issues.
3. It takes long to process decisions - as every team member must be consulted.
4. It can seem to be uncertain - Democratic leaders would sometimes become indecisive in
certain situations, especially during a crisis.
Task-Oriented Management
Task-Oriented Management - focuses on completing a job.
It concentrates on the tasks that have to be done, rather than who is doing them.
This leadership style emphasizes structure, plans, and schedules.
Task-Oriented Management focuses on: -
i. Completing the tasks at hand
ii. Effective goal-setting and a clear path to complete objectives
iii. Schedules and deadlines
iv. Structure, roles, and goals
v. Producing desired results
Human-Oriented Management
This style is also called:
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i. People-Oriented Management
ii. Relations-Oriented Management
iii. Consideration Management
iv. Inspirational Management
v. Employee Centred Management