MODULE 2

ORGANIZING AND STAFFING

ORGANIZATION DEFINITION:
Organization is the process of identifying and grouping work to be performed, defining and
delegating responsibility and authority and establishing relationships for the purpose of enabling
people to work most effectively together in accomplishing objectives.
An organization is a group of people who work together, like a neighborhood association, a
charity, a union, or a corporation.
Characteristics of Organization:
Different authors look at the word ‘organization’ from their own angle. One thing which is
common in all the viewpoints is that organization is the establishment of authority
relationship among persons so that it helps in the achievement of organizational objectives.
1. Division of Work:
Organisation deals with the whole task of business. The total work of the enterprise is
divided into activities and functions. Various activities are assigned to different persons for
their efficient accomplishment. This brings in division of labour. It is not that one person
cannot carry out many functions but specialisation in different activities is necessary to
improve one’s efficiency. Organisation helps in dividing the work into related activities so
that they are assigned to different individuals.
2. Co-Ordination:
Co-ordination of various activities is as essential as their division. It helps in
integrating and harmonising various activities. Co-ordination also avoids duplications and
delays. In fact, various functions in an organisation depend upon one another and the
performance of one influences the other. Unless all of them are properly coordinated, the
performance of all segments is adversely affected.
3. Common Objectives:
All organisational structure is a means towards the achievement of enterprise goals.
The goals of various segments lead to the achievement of major business goals. The
organisational structure should build around common and clear cut objectives. This will
help in their proper accomplishment.
4. Co-operative Relationship:
An organisation creates co-operative relationship among various members of the
group. An organisation cannot be constituted by one person. It requires at least two or
more persons. Organisation is a system which helps in creating meaningful relationship
among persons. The relationship should be both vertical and horizontal among members of
various departments. The structure should be designed that it motivates people to perform
their part of work together.
5. Well-Defined Authority-Responsibility Relationships:
An organisation consists of various positions arranged in a hierarchy with well defined
authority and responsibility. There is always a central authority from which a chain of
authority relationship stretches throughout the organisation. The hierarchy of positions
defines the lines of communication and pattern of relationships.
PROCESS OF ORGANISING:
In order to complete the organising function of management, following steps
are taken:
(1) Knowing the Objectives of the Enterprise
(2) Determining various Activities
(3) Grouping and Departmentalization of Activities
(4) Determining of Key Activities
(5) Assigning Responsibilities
(6) Delegating of Authorities
(7) Defining Inter-relationship
(8) Providing Right Environment
(1) Knowing the Objectives of the Enterprise:
The first step in the process of organisation is to know about the objectives of the
enterprise. Although the determination of the objectives of an enterprise is done under the
first function of management, i.e., planning but before commencing the process of
organisinga clear and detailed information about these objectives has to be obtained. On
the basis of the information about objectives various functions designed to achieve these
objectives are determined.
(2) Determining Various Activities:
After having learnt about the objectives of the enterprise, necessary functions to achieve
the objectives are determined. For example- a Mobile Phone manufacturing company can
have different activities like purchase of raw material, purchase of manufactured parts,
production, advertisement, sales, arrangement of finance, research, accounts,
correspondence, keeping stock of material, recruitment of employees, etc.
(3) Grouping of Activities:
In order to achieve the objectives of the enterprise grouping of various activities is done.
Under the grouping of activities all the similar type of activities are given to one particular
department. For example- the activities like the purchase of raw material, purchase of
ready-made parts, production, stocking the material, research, etc., are assigned to the
production department.
Similarly, advertisement and sales activities are given to the marketing department, and
department of finance takes care of finance, accounts and correspondence. Taking into
consideration the importance and quantity of the work a department can be further
divided into many branches or sub-departments.
(4) Determining Key Activities:
Key activity signifies the importance of this activity in the achievement of the objectives of
the enterprise. Such an activity needs special attention. It depends on the objectives of the
organisation to determine the key activity. Thus, in all the organisations key activity can be
different.
(5) Assigning of Responsibilities:
After dividing the various activities into different departments and sub-departments and
having determined the activity that each individual is expected to perform, his
responsibility is fixed. In other words, what they are to do for the attainment of the
objectives of the organisation.
(6) Delegating of Authority:
A person who is saddled with a responsibility must be given some authority too. Authority
means the freedom of taking decision, guiding the subordinates and the freedom of
supervising and controlling. Authority should be in proportion to the work or
responsibility. If the responsibility is greater than the authority given and is insufficient to
cope with the responsibility, the responsibility cannot be discharged successfully.
(7) Defining Inter-Relationship:
When two or more than two persons work for the attainment of common goals their inter-
relationship must be defined very clearly. Everybody should know who is his superior and
who is his subordinate?
(8) Providing Right Environment:
Organising it is not only such an activity which includes determination of activities; and the
defining of inter-relationship but it also ensures the optimum utilisation of human
resources by providing physical resources and the right environment.
PRINCIPLES OF ORGANIZATION:
(1) Consideration of Unity of Objectives:
The objective of the undertaking influences the organisation structure. The organisation is
a mechanism to achieve our goals. Objectives must be clearly defined for the entire
enterprise, for each department and even for each position in the organisation structure.
There must be unity of objective so that all efforts can be concentrated on the set goals.
Organisational structure and generated operations must be measured against the effec-
tiveness in achieving set objectives.
(2) Specialisation:
Greatest output can be obtained when each person concentrates on doing the thing for
which he/she is best qualified. Effective organisation must include specialisation. Precise
division of work facilitates specialisation. Organisation expresses the law of specialisation.
However, each area of specialisation must be inter-related to the total integrated system by
means of co-ordination of all departments and activities.
(3) Co-Ordination:
Organisation involves division of work among people whose efforts must be coordinated to
achieve common goals. Co-ordination expresses the principles of organisation in toto;
nothing less. Co-ordination is the orderly arrangement of group effort to provide unity of
action in the pursuit of- common purpose.
It is the beginning and end of all organised effort. A manager is mainly a coordinator.
Chosen grouping of activities should minimise co-ordination problems. Co-ordination is a
facilitative function, helping the integration of the basic managerial functions — planning,
organisation, motivation and control. Co-ordination aims at higher efficiency and
effectiveness.
(4) Scalar Principle:
It points out clear unbroken line of authority. It is also called chain of command. The line of
authority flows from the highest executive to the lowest managerial level and the chain of
command should not be broken. It should be short, i.e., we should have few levels of
management.
(5) Responsibility:
Authority should be equal to responsibility, i.e., each manager should have enough
authority to accomplish the task. Similarly, the responsibility of the superior for the acts of
his subordinate is absolute.
(6) Efficiency:
The organisation structure should enable the enterprise to attain objectives with the
lowest possible cost- money cost as well as human cost. An efficient organisation structure
operates without wasting its scarce resources. It permits maximum use of its human
resources and talents.
(7) Delegation:
Decision-making power should be placed nearer the scene of action. Decisions should be
made at the lowest competent level. Authority and responsibility should be delegated as far
down in the organisation as possible, i.e. at the lowest level of the organisation at which the
particular responsibility can be efficiently discharged. Delegation of authority and
decentralisation of authority mean the same process.
(8) Unity of Command:
Each person should be accountable to a single superior- one superior or one boss and one
subordinate, e.g., A is the boss of B. B is accountable to A. B is the boss of C; C is accountable
to B. Thus, no one in the organisation should have more than one boss. It clarifies
authority-responsibility relationship.
If an individual has to report to only one supervisor, there is a sense of personal res-
ponsibility to one person for results. Let a person receive orders from and be responsible
to only one superior.
(9) Span of Control or Span of Management:
There is a limit to which a manager can manage effectively the number of subordinates. No
superior at a higher level should have more than six immediate subordinates. Average
human brain can effectively direct three to six brains (i.e. subordinates). Grouping must
ensure that each supervisor and manager is not overburdened with subordinates.
(10) Balance:
There should be reasonable balance in the size of various departments, between
standardisation of procedures and flexibility, between centralisation and decentralisation.
Similarly, there should be balance between the principle of span of control and the short
chain of command. If the chain of command is shortened, span of control will be increasing,
and vice versa.
(11) Communication:
A good communication subsystem is essential for smooth flow of information and
understanding and for effective business performance. The line of authority offers a
standing channel for downward and upward communication.
(12) Personal Ability:
People constitute, an organisation. Proper selection, placement and training need not be
overemphasized. Organisation structure must encourage management development
programme and ensure optimum use of human resources.
(13) Exception Principle:
Recurring decisions should be handled in a routine matter by lower level managers. To the
degree permitted by delegated authority each manager should make all decisions he can.
Only those matters, not covered by his assigned responsibility and authority, should be
referred to his boss.
Under the exception principle, recurring decisions should be handled in a routine manner
by the lower level manager, whereas problems involving unusual matters should be
referred to the higher level. The executive at the higher level of an organisation have
limited time and capacity.
They should not be bothered by routine problems which can as well be managed by
subordinates. Programmed decisions of repetitive and routine nature can be handled by
standard procedures and these may be easily delegated but non-programmed decisions
involve, one shot and unstructured elements. These require tailored handling by the
superiors and usually need their attention.
(14) Flexibility:
The organisation is expected to provide built-in devices to facilitate growth and expansion
without dislocation. It should be adaptable to changing circumstances. It should not be
rigid or inelastic.
(15) Departmentation:
It enables the division of activities into specialised groups to attain organisational
objectives. A good organisation involves precise and systematic distribution of work and
responsibilities between managerial group and administrative group. Departmentation
maintains balance and harmony in the working of the organisation.
(16) Definiteness:
Each activity must contribute to the primary or basic goals of an enterprise with minimum
of effort and maximum of efficiency, on the part of the employees.
(17) Simplicity:
The organisation should be kept as simple as possible.
(18) Separation of Line and Staff Function:
Line function should be separated from the staff functions.
(19) Continuity:
Reorganisation is a continuous process; in every undertaking: specific provision should be
made for it.
(20) Leadership:
Organisation structure should create a favourable environment or situation in which the
manager can most effectively lead and motivate his subordinates.
SPAN OF MANAGEMENT:
Definition: The Span of Management refers to the number of subordinates who can be managed
efficiently by a superior. Simply, the manager having the group of subordinates who report him
directly is called as the span of management.
The Span of Management has two implications:
1. Influences the complexities of the individual manager’s job
2. Determine the shape or configuration of the Organization
Factors Affecting Span of control:
Capacity of Superior:
Different ability and capacity of leadership, communication affect management of
subordinates.
Capacity of Subordinates:
Efficient and trained subordinates affects the degree of span of management.
Nature of Work:
Different types of work require different patterns of management.
Degree of Centralization or Decentralization:
Degree of centralization or decentralization affects the span of management by
affecting the degree of involvement of the superior in decision making.
Degree of Planning:
Plans which can provide rules, procedures in doing the work higher would be the
degree of span of management.
Communication Techniques:
Pattern of communication, its means, and media affect the time requirement in
managing subordinates and consequently span of management.
Use of Staff Assistance:
Use of Staff assistance in reducing the work load of managers enables them to
manage more number of subordinates.
Supervision of others:
If subordinate receives supervision form several other personnel besides his direct
supervisor. In such a case, the work load of direct superior is reduced and he can
supervise more number of persons.
Span of control is of two types:
1. Narrow span of control: Narrow Span of control means a single manager or
supervisoroversees few subordinates. This gives rise to a tall organizational structure.
Advantages:
 Close supervision
 Close control of subordinates
 Fast communication
Disadvantages:
 Too much control
 Many levels of management
 High costs
 Excessive distance between lowest level and highest level
Wide span of control: Wide span of control means a single manager or supervisor
overseesa large number of subordinates. This gives rise to a flat organizational structure.

Advantages:
 More Delegation of Authority
 Development of Managers
 Clear policies
Disadvantages:
 Overloaded supervisors
 Danger of superiors loss of control
 Requirement of highly trained managerial personnel
 Block in decision making
DEPARTMENTALIZATION:
Departmentalization is defined as a process that groups activities into different departments.
These departments are created so that tasks can be performed by specialization within the
organization. You will find it in both private and public [Link] also refers
to an organization’s formal structure that includes several departments and positions and their
respective relationship with each other.
OBJECTIVES :
The objectives of departmentalization are as follows-
1. Maintaining control
2. Simplifying the operational process in the company
3. Grouping the specialized activities under one umbrella
4. Increasing the efficiency of management and ultimately the organization
5. Fixing responsibilities and of course accountability
Methods of Departmentalization
1. Departmentalization by Function: When the creation of department is on the basis of
specified functions, such as production, marketing, purchase, finance etc. In this method, all
the activities related to a function or which are of similar nature are combined in a single
unit, to give proper directions to the entire group in one go.

2. Departmentalization by Process: In departmentation by the process, the activities are

grouped as per the production processes. These departments require manpower and
 material so as to carryout operations.

3. Departmentalization by Product: When the activities related to product development and

delivery are combined into a particular division, it is called as product departmentalization.
It is appropriate for large-scale multi-product enterprises.
 4. Departmentalization by Customer: The grouping of the organization according to the
different classes of customer or clients. It focuses on special customer needs.

5. Departmentalization by Territory: When the division is based on the geographical area, it

is called as territorial departmentalization. This is suitable for the organizations, that have
widespread operations at different locations.
6. Departmentalization by Project: In project departmentalization, the organizational
activities are classified by differentiated or special ventures or activities.

The choice of departmentalization basis is influenced by the factors such as the degree
of specialization, coordination, control, cost consideration, adequate attention to key areas,
etc
ADVANTAGES OF DEPARTMENTALIZATION:
1. Departmentalization is an effective grouping that enables meaningful work
2. It is easy to coordinate different work in the same department
3. Departmentalization results in the integration of work
4. Achieves economic advantage
5. Departmentalization enables utilization of local conditions via low operational costs
6. Simplifies training
7. Utilizes special skills and specialized training to increase personal as well as company
productivity
8. Departmentalization helps the company to gain the benefit of specialization
9. There is a feeling of autonomy as the manager is granted the power to take independent
decisions
10. It increases the chance of growth and expansion
11. Departments are created to fix the role of every person involved. Responsibilities are clear
and precise, and every person is now accountable for his/her action
12. All departments are specific, and workers within it have a greater chance of uplifting and
further learning of the skills. It actually acts as on-the-job training. If the manager comes
across someone in his group who he thinks to need specialized training, he can easily
arrange for it.
13. It becomes easy to evaluate managerial performance as tasks are allotted department wise.
14. Departmentalization results in better administrative control.
Disadvantages of departmentalization
1. As departments continue to grow it creates less adaptability within the organization
 2. When a company groups activities and people in one specific department there is little
room for flexibility
3. Difficulty in coordination between different departments
4. Less responsibility and accountability as the departments are concerned with their own
space and not the company as a whole.
5. Too much emphasis on specialization
6. Rising conflicts between different departments
COMMITTEES
Definition: The Committees are the association of organizational people who come
together to analyze, investigate and discuss the issues of concern and reach to the final
conclusion. The committees are usually formed at different levels in the organization.
Principles of a Committee:
1. The number of persons in a committee should depend upon the need and be optimum
minimum (about 5 to 10 persons).
2. Responsibility, authority, objectives and duties of the committee should be clearly
defined.
3. Agenda of the committee should be prepared and communicated to the committee
members at least a week before they meet for discussions.
4. Problems which can be taken care of by an individual should not be included in the
agenda of the committee.
5. Committee meetings should begin and end on prefixed timings.
6. Problems not related to the subject-matter at hand should not be discussed because it
will simply waste time.
7. The operation of the committee should be a cooperative development.
8. The recommendations made by the committee should be published and circulated to
interested and concerned persons.
9. A committee must be dissolved after its purpose is over.
Types of Committee:
(a) A standing or permanent committee is needed in a complex organisation experiencing
multifaceted problems almost all the times.
(b) A temporary committee is formed to face and solve problems arising occasionally.
(c) The committee in control has full powers to act and may assume a position that could
be manned by one individual.
(d) The coordination and discussion committee discusses problems and gives its advice. It
has no power to act.
(e) The advisory committee explores various aspects of a problem and suggests courses of
action to the concerned executive, thereby helping him to reach the decisions for which he
is held responsible. The committee does not have power to act. Advisory Committee is used
extensively in business.
(f) The educational committee aids in getting information about company problems,
policies and projects to major individuals concerned. It also gives an insight into the
ultimate company organisation, etc.
Advantages of a Committee:
1. A committee often performs worth-while tasks since two experts are better than one.
2. A committee coordinates the efforts of the departments which are represented (e.g.,
sales, production and engineering) in development of a new product.
3. A committee is of special value in broad policy determination and rounding out plans.
4. A committee reduces the work load of management.
5. Committees are especially good at innovation or brain storming.
6. A committee helps securing co-operation of various personnel.
7. A committee is effectively used to appoint persons to fill vacant positions in the
enterprise.
8. Committee meetings may be called to train younger executives and to give them a keener
insight into the operation of the business.
Limitations of a Committee:
1. Sometimes it turns out to be true that what a committee finishes in a week, a good
individual may complete in a day.
2. It may be said that committee operations are slow and committees tend to hang on for a
considerable time.
3. An executive afraid to stand behind his own decisions may use a rubber-stamp
committee and thereby share his responsibility with others.
4. In a committee, no individual can be held responsible for anything.
5. Committee decisions represent generally a compromised position and do not truly
reflect the real feelings of the individual committee (or group) members.
DIFFERENCE BETWEEN CENTRALIZATION AND DECENTRALIZATION:
[Link] FUNCTION CENTRALIZATION DECENTRALIZATION
Decentralization in an
Centralization in an organization
organization involves
involves decision-making
decision-making capability
capability in the hands of top
1 Definition through middle management
management. It implies that all
or lower management. Power
power, authority is upheld at the
, authority are upheld by
topmost level.
lower management.
No alignment, it is free and
2 Flow of Communication Vertically aligned
more open
Decision-making process is
3 Decision This is comparatively faster.
slower
Power is in hands of Senior Middle and Lower
4 Authority
management management have power
No proper control over Proper control over
5 Suitability
organization organization
Centralization is ideal for small- Decentralization is ideal for
6 Ideal for
sized organizations large-sized organizations
In decentralization, a higher
In centralization, only a few
number of people from each
7 People involved handpicked people are involved
level are involved in the
in the decision-making process
decision-making process
8 Employee motivation Demotivated employee Highly motivated employee
Only one group is carrying the The burden gets shared
9 Burden
burden among many levels
DIFFERENCE BETWEEN AUTHORITY AND RESPONSIBILITY
Basis for
Authority Responsibility
Comparison
Authority refers to the power or Responsibility denotes duty or obligation
right, attached to a particular job to undertake or accomplish a task
Meaning or designation, to give orders, successfully, assigned by the senior or
enforce rules, make decisions and established by one's own commitment or
exact compliance. circumstances.
What is it? Legal right to issue orders. Corollary of authority.
Results from Formal positon in an organization Superior-subordinate relationship
Task of
Delegation of authority Assumption of responsibility
manager
Requires Ability to give orders. Ability to follow orders.
Flow Downward Upward
To make decisions and implement
Objective To execute duties, assigned by superior.
it.
Ends, as soon as the task is
Duration Continues for long period.
accomplished.
Meaning of Staffing:
After organising the business operations, staffing involves matching the jobs with
people. While organising creates jobs, staffing makes people suitable to jobs. Staffing deals
with appointing people and placing them at the appropriate jobs. It is “filling, and keeping
filled, positions in the organisation structure.
Nature of Staffing:
1. Management function:
Staffing is a management function that appoints people at different positions to run the
organisation. While organising creates departments and positions, staffing ensures that
people with desired skills and abilities occupy these positions to contribute to
organisational goals.
2. Pervasive function:
People are the most important asset that convert inputs into outputs. People are appointed
at all levels (top, middle, low) in all functional areas (production, finance, marketing,
personnel). Staffing ensures that right persons are appointed at the right job so that
organisation can efficiently achieve its objectives.
3. Part of human resource management:
Staffing is an important part of human resource management. Human resource
management ensures that competent people perform organisational activities. It deals with
the set of organisational activities that attract, develop and maintain an effective
workforce. The requirements of human resource management are filled through staffing as
staffing appoints people at the desired jobs.
4. Deals with active resource:
Staffing deals with the most important resource (people) that converts inactive resources
(raw materials) into productive outputs. It deals with the live resource (people) without
whom resources would remain as resources only. They will not be converted into outputs.
5. Attached with personnel department:
Functions of staffing; recruitment, selection, training and appraisal of subordinates of all
departments (production, marketing etc.) are performed by managers at all levels as all
departments need people to function. In performing these functions, managers seek
assistance of the personnel department. Personnel department is a service department that
assists line managers in performing the staffing function.
6. Continuous function:
Staffing is a continuous managerial function. People keep leaving and joining the
organisations. Departments and organisations grow and, therefore, need for people keeps
arising. Hiring, training and compensating people (staffing) are, therefore, continuously
performed by managers.
Need for Staffing:
Staffing provides manpower to the organisation. In the changing, dynamic environment
where organisational size is increasing, technology is developing and human behaviour is
becoming complex, staffing function has become important. Need for staffing explains the
objectives of staffing.
These objectives are as follows:
1. To achieve organisational objectives by recognisingits most valuable resource; work
force.
2. To increase loyalty and commitment of workers towards individual and organisational
goals.
3. To select people with suitable qualifications to fill organisational posts.
4. To increase skills of people on-the-job by providing training facilities.
5. To develop abilities of the staff to assume jobs of higher skill, competence and
responsibility
6. To establish equitable and adequate compensation for people by providing them
monetary and non-monetary incentives. This promotes active contribution to
organisational objectives.
7. To reconcile individual, organisational and social interests by maintaining efficient
system of communication in the organisation.
8. To provide physical working conditions (lighting, ventilation, recreation facilities etc.) to
maintain employees’ commitment to jobs.
9. To maintain record of achievements so that managers can make policies with respect to
transfers, promotions and demotions.
10. To make optimum use of human resource to achieve organisational objectives.
11. To make people realise their potential at work and develop them for promotion to
higher managerial posts.
12. To maintain an environment of teamwork and innovation.
IMPORTANCE OF STAFFING:
Staffing function is important for the following reasons:
1. Emphasis on human element:
Human force is the most important and productive asset of the organisation which carries
out the functions and productive activities of various departments. People are the primary
source of productivity gains. “If you want productivity and financial reward that goes with
it, you must treat your workers as your most important asset.” — Thomas Peters and
Robert Waterman
2. Facilitates leadership:
Well conducted staffing function provides leadership facilities so that individuals can
satisfy their personal goals along with organisational goals. Employee turnover has become
a matter of concern for many companies at higher levels as talented workforce is always on
the look-out for better job opportunities. Besides filling the organisational posts, thus, the
staffing function also ensures that the posts remain filled. A good leadership role helps in
synthesizing individual goals with organisational goals.
3. Facilitates control:
Well trained staff works according to plans and deviations in performance are reduced.
This helps managers in controlling various organisational functions.
4. Motivation to work:
Financial rewards do not always motivate the employees. Their acceptance and recognition
by managers are also strong forces of motivation. When emphasis is placed on human
element in the organisation, people are motivated to contribute to goals of the
organisation.
5. Increase in efficiency:
Since staffing helps to place the right person, with the right knowledge, at the right place
and the right time to perform the organisational activities, efficiency of the organisation
increases. If people are not competent to do their jobs, organisational goals will not be fully
achieved. Though people are appointed at specific job positions, there may be changes in
their job profile because of changing environmental conditions.
6. Develops potential managers:
Recruiting and selecting people with the best potential, compensating and training them to
develop future managers facilitates movement of managerial abilities from lower to higher
levels of the organisation.
7. Competitive advantage:
In the era of globalisation, every enterprise faces tough competition from national and
international competitors. A well-staffed organisation provides management sound
policies and procedures for adapting to the environment and face competition. The fast
changing technology can be adopted by organisations only if the manpower is trained to do
so.
RECRUITMENT:
Recruitment is a process of finding and attracting the potential resources for filling up the
vacant positions in an organization. It sources the candidates with the abilities and attitude,
which are required for achieving the objectives of an organization.
Recruitment process is a process of identifying the jobs vacancy, analyzing the job
requirements, reviewing applications, screening, shortlisting and selecting the right
candidate.

SOURCES OF RECRUITMENT:
DIFFERENCE BETWEEN RECRUITMENT AND SELECTION:
The difference between recruitment and selection can be understood by comparing the
two processes against the same characteristics or factors.
Comparison Recruitment Selection
An activity of searching for potential
A process of selecting the best candidates and
Meaning candidates and encouraging them to
offering them the job.
apply.
Positive – seeking out an increase in the Negative – seeking out ways to reduce the applicant
Approach
applicant pool. pool until one ideal candidate is identified.
Inviting more candidates to apply for a Choosing the most suitable candidate and rejecting
Objective
vacant position. the rest.
Key Factor Advertising the job. Appointing the candidate.
Sequence First. Second.
Vacancies are notified by the organization The organization makes an applicant go through
through various sources, then an various levels (submitting a form, writing a test,
Process
application form is made available to undergoing an interview, etc.) to deem whether
candidates. they’re an appropriate fit.
The recruitment policy specifies the
The selection policy consists of a series of
objectives of recruitment, providing rules
Specifications methods/steps/stages by which the evaluation of
and regulations for the implementation of
the candidate will be done.
the recruitment program.
Recruitment only implies communication
Contractual of vacancies and open positions – Selection involves the creation of a contractual
Relation therefore, no contractual relation is agreement between the employer and employee.
established.
Method Economical. Expensive.

SELECTION PROCESS:
The selection process is quite lengthy and complex as it involves a series of steps before
making the final selection. The procedure of selection may vary from industry to industry, company
to company and even from department to department. Every organization designs its selection
process, keeping in mind the urgency of hiring people and the prerequisites for the job vacancy.
1. Preliminary Interview:
The preliminary interview is also called as a screening interview wherein those
candidates are eliminated from the further selection process who do not meet the
minimum eligibility criteria as required by the organization. Here, the individuals are
checked for their academic qualifications, skill sets, family backgrounds and their
interest in working with the firm. The preliminary interview is less formal and is
basically done to weed out the unsuitable candidates very much before proceeding with
a full-fledged selection process.
2. Receiving Applications:
Once the individual qualifies the preliminary interview he is required to fill in the
application form in the prescribed format. This application contains the candidate
data such as age, qualification, experience, etc. This information helps the
interviewer to get the fair idea about the candidate and formulate questions to get
more information about him.
3. Screening Applications:
Once the applications are received, these are screened by the screening committee,
who then prepare a list of those applicants whom they find suitable for the
interviews. The shortlisting criteria could be the age, sex, qualification, experience of
an individual. Once the list is prepared, the qualified candidates are called for the
interview either through a registered mail or e-mails.
4. Employment Tests:
 In order to check the mental ability and skill set of an individual, several tests are
conducted. Such as intelligence tests, aptitude tests, interest tests, psychological
tests, personality tests, etc. These tests are conducted to judge the suitability of the
candidate for the job.
5. Employment Interview:
The one on one session with the candidate is conducted to gain more insights about
him. Here, the interviewer asks questions from the applicant to discover more about
him and to give him the accurate picture of the kind of a job he is required to
perform. Also, the briefing of certain organizational policies is done, which is crucial
in the performance of the job. Through an interview, it is easier for the employer to
understand the candidate’s expectations from the job and also his communication
skills along with the confidence level can be checked at this stage.
6. Checking References:
The firms usually ask for the references from the candidate to cross check the
authenticity of the information provided by him. These references could be from the
education institute from where the candidate has completed his studies or from his
previous employment where he was formerly engaged. These references are
checked to know the conduct and behavior of an individual and also his potential of
learning new jobs.
7. Medical Examination:
Here the physical and mental fitness of the candidate are checked to ensure that he
is capable of performing the job. In some organizations, the medical examination is
done at the very beginning of the selection process while in some cases it is done
after the final selection. Thus, this stage is not rigid and can take place anywhere in
the process. The medical examination is an important step in the selection process
as it helps in ascertaining the applicant’s physical ability to fulfill the job
requirements.
8. Final Selection:
Finally, the candidate who qualifies all the rounds of a selection process is given the
appointment letter to join the firm.
Thus, the selection is complex and a lengthy process as it involves several stages than an
individual has to qualify before getting finally selected for the job.
DIRECTING:
Direction is an important function of management which is related to inspiring, instructing
and guiding human factors in the organization to achieve organizational activities and
objectives. A superior direct and control the subordinates and instruct the manpower
which yields better performance. Direction is the guideline inspiration which is provided
from higher position to lower position. It is also an important function of management. It is
useful to coordinate the activities. Therefore, it is defined as the skill of influencing
employees.
PRINCIPLES OF DIRECTION:
1. Principle of harmony of objectives: every organization set the objectives and these
objectives are to be fulfilled with the help of people working in the organization. Therefore
managers must try to bring harmony between individual and organizational goals
2. Unity of command: The individual who works in the organization get direction from
his/her superior. The subordinates must get direction from only one superior to reduce
conflict and confusion which is called unity of command.
3. Direct supervision: When superior direct the subordinates with face to face
communication it is known as direct supervision. It helps to increase the morale of
employees and it helps to develop quick feedback and necessary information
4. Appropriate leadership style: proper leadership means the skill of leading that depends
upon the characteristics of leader, features of subordinates and the situation. It is the
process of influencing human behavior in achieving organizational goals without
dissatisfaction of any employees
5. Maximum individual contribution: The employees’ capacity should be used fully with
effective direction by encouragement not irritation with proper design direction style.
6. Effective communication: without effective communication, direction is not possible.
Mainly, communication may be downward or upward in an organization. Downward
communication carries the order, ideas, instruction to the subordinates and upward
communication carries the order, ideas, and instruction from the subordinates.
7. Effective control: without effective control organization can’t be operated. Effective
control helps to coordinate and supervise the activities and other mechanism.
8. Effective motivation: Motivation is the act of inspiring and encouraging the people to do
work. Employees must be motivated to achieve the goals. Without motivation , direction
cannot be complete
9. Flow of information: information is most important asset in any organization. When
information is blocked, then there can be failure. On the other hand, information is useful to
issue the order, ideas, and instruction.
10. Follow- up: direction is a continuous managerial process. It involves constant and
continuous supervision, counseling, advice, instructions etc in the employees’ activities.
Merely issuing orders is not sufficient but management should find out whether the
subordinate is working or not
Motivation:
Motivation is an important factor which encourages persons to give their best performance and
help in reaching enterprise goals. A strong positive motivation will enable the increased output of
employees but a negative motivation will reduce their performance. A key element in personnel
management is motivation.

Nature of Motivation:

1. Motivation is an inner feeling which energizes a person to work more.

2. The emotions or desires of a person prompt him for doing a particular work.

3. There are unsatisfied needs of a person which disturb his equilibrium.

4. A person moves to fulfill his unsatisfied needs by conditioning his energies.

5. There are dormant energies in a person which are activated by channelizing them
into actions.
Types of Motivation:
The following are the types of motivation:
1. Positive Motivation:
Positive motivation or incentive motivation is based on reward. The workers are offered
incentives for achieving the desired goals. The incentives may be in the shape of more pay,
promotion, recognition of work, etc. The employees are offered the incentives and try to
improve their performance willingly.
2. Negative Motivation:
Negative or fear motivation is based on force or fear. Fear causes employees to act in a
certain way. In case, they do not act accordingly then they may be punished with demotions
or lay-offs. The fear acts as a push mechanism. The employees do not willingly co-operate,
rather they want to avoid the punishment.
Motivation Theories
Motivation is a state-of-mind, filled with energy and enthusiasm, which drives a person to
work in a certain way to achieve desired goals. Motivation is a force which pushes a person
to work with high level of commitment and focus even if things are against him. Motivation
translates into a certain kind of human behaviour.
It is important to ensure that every team member in an organization is motivated. Various
psychologists have studied human behaviour and have formalized their findings in the
form various motivation theories. These motivation theories provide great understanding
on how people behave and what motivates them.
Motivation is a huge field of study. There are many theories of motivation. Some of the
famous motivation theories include the following:
Maslow’s hierarchy of needs:
Abraham Maslow postulated that a person will be motivated when his needs are fulfilled.
The need starts from the lowest level basic needs and keeps moving up as a lower level
need is fulfilled. Below is the hierarchy of needs:

 Physiological: Physical survival necessities such as food, water, and shelter.

 Safety: Protection from threats, deprivation, and other dangers.
 Social (belongingness and love): The need for association, affiliation, friendship, and so on.
 Self-esteem: The need for respect and recognition.
 Self-actualization: The opportunity for personal development, learning, and
fun/creative/challenging work. Self-actualization is the highest level need to which a
 human being can aspire.

The leader will have to understand the specific need of every individual in the team and accordingly
work to help fulfil their needs.
[Link] Needs:
These needs are basic to human life and, hence, include food, clothing, shelter, air, water
and necessities of life. These needs relate to the survival and maintenance of human life.
They exert tremendous influence on human behaviour. These needs are to be met first at
least partly before higher level needs emerge. Once physiological needs are satisfied, they
no longer motivate the man.
2. Safety Needs:
After satisfying the physiological needs, the next needs felt are called safety and security
needs. These needs find expression in such desires as economic security and protection
from physical dangers. Meeting these needs requires more money and, hence, the
individual is prompted to work more. Like physiological needs, these become inactive once
they are satisfied.
3. Social Needs:
Man is a social being. He is, therefore, interested in social interaction, companionship,
belongingness, etc. It is this socialising and belongingness why individuals prefer to work
in groups and especially older people go to work.
4. Esteem Needs:
These needs refer to self-esteem and self-respect. They include such needs which indicate
self-confidence, achievement, competence, knowledge and independence. The fulfillment of
esteem needs leads to self-confidence, strength and capability of being useful in the
organisation. However, inability to fulfill these needs results in feeling like inferiority,
weakness and helplessness.
5. Self-Actualisation Needs:
This level represents the culmination of all the lower, intermediate, and higher needs of
human beings. In other words, the final step under the need hierarchy model is the need for
self-actualization. This refers to fulfillment.
The term self-actualization was coined by Kurt Goldstein and means to become actualized
in what one is potentially good at. In effect, self- actualization is the person’s motivation to
transform perception of self into reality.
According to Maslow, the human needs follow a definite sequence of domination. The
second need does not arise until the first is reasonably satisfied, and the third need does
not emerge until the first two needs have been reasonably satisfied and it goes on. The
other side of the need hierarchy is that human needs are unlimited. However, Maslow’s
need hierarchy-theory is not without its detractors.
Hertzberg’s two factor theory:
The psychologist Frederick Herzberg extended the work of Maslow and propsed a new
motivation theory popularly known as Herzberg’s Motivation Hygiene (Two-Factor)
Theory. Herzberg conducted a widely reported motivational study on 200 accountants and
engineers employed by firms in and around Western Pennsylvania.
He asked these people to describe two important incidents at their jobs:
(1) When did you feel particularly good about your job, and
(2) When did you feel exceptionally bad about your job? He used the critical incident
method of obtaining data.
The responses when analysed were found quite interesting and fairly consistent. The
replies respondents gave when they felt good about their jobs were significantly different
from the replies given when they felt bad. Reported good feelings were generally
associated with job satisfaction, whereas bad feeling with job dissatisfaction. Herzberg
labelled the job satisfiers motivators, and he called job dissatisfies hygiene or maintenance
factors. Taken together, the motivators and hygiene factors have become known as
Herzberg’s two-factor theory of motivation Hertzberg classified the needs into two broad
categories namely hygiene factors and motivating factors.
Hygiene factors are needed to make sure that an employee is not dissatisfied. Motivation
factors are needed for ensuring employee's satisfaction and employee’s motivation for
higher performance. Mere presence of hygiene factors does not guarantee motivation, and
presence of motivation factors in the absence of hygiene factors also does not work.
COMMUNICATION:
Communication may be defined as “the transfer of information and understanding from
one person to another.”
According to Koontz and O’Donnel, Communication may be understood “as the exchange of
information at least between two persons with a view to create an understanding in the
mind of the other, whether or not it gives rise to conflict.”
Newman and Summer- “Communication is an exchange of facts, ideas, opinions or
emotions by two or more persons.”
Purpose of Communication:
Management is getting the things done through others. The people working in the
organisation should therefore be informed how to do the work assigned to them in the best
possible manner. The communication is essential in any organisation.
The purpose of the communication can be summed up into the following:
1. Flow of Information:
The relevant information must flow continuously from top to bottom and vice versa.
The staff at all levels must be kept informed about the organisational objectives and other
developments taking place in the organisation. A care should be taken that no one should
be misinformed. The information should reach the incumbent in the language he or she can
understand better. The use of difficult words should be avoided. The right information
should reach the right person, at right time through the right person.
2. Coordination:
It is through communication the efforts of all the staff working in the organisation can
be coordinated for the accomplishment of the organisational goals. The coordination of all
personnel’s and their efforts is the essence of management which can be attained through
effective communication.
3. Learning Management Skills:
The communication facilitates flow of information, ideas, beliefs, perception, advice,
opinion, orders and instructions etc. both ways which enable the managers and other
supervisory staff to learn managerial skills through experience of others. The experience of
the sender of the message gets reflected in it which the person at the receiving end can
learn by analyzing and understanding it.
4. Preparing People to Accept Change:
The proper and effective communication is an important tool in the hands of management
of any organisation to bring about overall change in the organisational policies, procedures
and work style and make the staff to accept and respond positively.
5. Developing Good Human Relations:
Managers and workers and other staff exchange their ideas, thoughts and perceptions with
each other through communication. This helps them to understand each other better. They
realize the difficulties faced by their colleagues at the workplace. This leads to promotion of
good human relations in the organisation.
6. Ideas of Subordinates Encouraged:
The communication facilitates inviting and encouraging the ideas from subordinates on
certain occasions on any task. This will develop creative thinking. Honoring subordinates’
ideas will further motivate them for hard work and a sense of belonging to the organisation
will be developed. It will provide them with the encouragement to share information with
their superiors without hesitation. The managers must know the ideas, thoughts,
comments, reactions and attitudes of their subordinates and subordinates should know the
same from the lowest level staff of their respective departments.
IMPORTANCE OF COMMUNICATION:

1. Sharing of information
Information consists of different kinds of messages, letters, assignments, audio-visual
which has to be shared with the different departments in the organization to discuss
important issues and to circulate different messages to the outsiders even.
For Eg– Sign of No Smoking, Mobiles Switch off are displayed in the central part of an
organization
2. Persuasion
It is a skill by which the sender can make the receiver understand what exactly the
information is about.
For Eg To sell any product effectively to the customer persuasive communication skill is
very important to a salesman
[Link] –
It plays a very crucial role in the organization which gives encouragement to the employees
to increase their work efficiency
For eg – Complimentary letters were given to employees for their performance
4 Coordination
All activities are been coordinated inter-departmentally so smooth communication is very
important.
[Link] making
No doubt decision is always taken by top management but it has to be taken by the
involvement of middle-level management also so that the decision can be accepted by
employees & workers easily
For eg. –Involvement of departmental heads during the top management meeting
6 Giving Orders
An order is an autocratic kind of communication which flows from top to bottom which
is used as a tool to improve employees behavior
For Eg– Giving a written memo to employees if they continuously misbehave in an
organization
7. Suggestion –
It is a free kind of communication where there is no need for any expertise
For eg– Suggestion boxes in an organization.
[Link] employees morale–
The morale of employees can be increased by a continuous appreciation of their
performances
For eg– Word of appreciation for achievement Monthly, quarterly, or yearly
Leadership
Leadership is a process by which an executive can direct, guide and influence the behavior
and work of others towards accomplishment of specific goals in a given situation.
Leadership is the ability of a manager to induce the subordinates to work with confidence
and zeal.
Leadership is the potential to influence behaviour of others. It is also defined as the
capacity to influence a group towards the realization of a goal. Leaders are required to
develop future visions, and to motivate the organizational members to want to achieve the
visions.
According to Keith Davis, “Leadership is the ability to persuade others to seek defined
objectives enthusiastically. It is the human factor which binds a group together and
motivates it towards goals.”
Characteristics of Leadership
1. It is a inter-personal process in which a manager is into influencing and guiding
workers towards attainment of goals.
2. It denotes a few qualities to be present in a person which includes intelligence,
maturity and personality.
3. It is a group process. It involves two or more people interacting with each other.
4. A leader is involved in shaping and moulding the behaviour of the group towards
accomplishment of organizational goals.
5. Leadership is situation bound. There is no best style of leadership. It all depends
upon tackling with the situations.
Importance of Leadership
Leadership is an important function of management which helps to maximize efficiency
and to achieve organizational goals. The following points justify the importance of
leadership in a concern.
1. Initiates action- Leader is a person who starts the work by communicating the policies and
plans to the subordinates from where the work actually starts.
 2. Motivation- A leader proves to be playing an incentive role in the concern’s working. He
motivates the employees with economic and non-economic rewards and thereby gets the
work from the subordinates.
3. Providing guidance- A leader has to not only supervise but also play a guiding role for the
subordinates. Guidance here means instructing the subordinates the way they have to
perform their work effectively and efficiently.
4. Creating confidence- Confidence is an important factor which can be achieved through
expressing the work efforts to the subordinates, explaining them clearly their role and
giving them guidelines to achieve the goals effectively. It is also important to hear the
employees with regards to their complaints and problems.
5. Building morale- Morale denotes willing co-operation of the employees towards their
work and getting them into confidence and winning their trust. A leader can be a morale
booster by achieving full co-operation so that they perform with best of their abilities as
they work to achieve goals.
6. Builds work environment- Management is getting things done from people. An efficient
work environment helps in sound and stable growth. Therefore, human relations should be
kept into mind by a leader. He should have personal contacts with employees and should
listen to their problems and solve them. He should treat employees on humanitarian terms.
7. Co-ordination- Co-ordination can be achieved through reconciling personal interests with
organizational goals. This synchronization can be achieved through proper and effective co-
ordination which should be primary motive of a leader.
LEADERSHIP STYLES:
Leadership style is the manner and approach of providing direction, implementing
plans, and motivating people. As seen by the employees, it includes the total pattern of
explicit and implicit actions performed by their leader
Leadership styles refer to a leader’s behavior toward group members. The behavior
pattern is that the leader reflects his role as a leader is described as style.
Leadership style is the results of a leader’s philosophy, personality, and experience and
value system.
Leadership styles based on authority can be 3 types:
1. Autocratic Leadership,
2. Democratic or Participative Leadership,
3. Free-Rein or Laisse-Faire Leadership
Autocratic Leadership
The leader tells his or her employees what to do and how to do it, without getting their
advice
  Autocratic Leadership relies on coercion, and its style is paternalism, arbitrariness,
command, and compliance. The autocratic leader gives orders which must be
obeyed by the subordinates.
 He determines policies for the group without consulting them and does not give
detailed information about plans, but simply tells the group what immediate steps
they must take.
 However, some autocratic leaders may happen to be “benevolent autocrats.”
 Generally, they are willing to hear and consider subordinates’ ideas and suggestions,
but when a decision is to be made, they turn out to be more autocratic than
benevolent.
Advantages of autocratic leadership
 It is the speed with which decisions can be made; the leader does not have to obtain group
members’ approval before deciding.
Disadvantages of autocratic leadership
 Autocratic leadership does hurt group morale.
 Members may resent how decisions are made and thus support them in only a minimal
fashion.
Democratic Leadership:
The leader includes one or more employees in the decision making process, but the leader
normally maintains the final decision making authority
  The style of leadership that uses legitimate power can be classified as democratic
leadership.
 A democratic leader usually gives instructions only after consulting with the group.
He sees to it that policies are worked out in group discussion and with the
acceptance of the group.
 That means democratic leadership solicits employees’ participation and respects
their opinions.
ADVANTAGES OF DEMOCRATIC LEADERSHIP
 It often enhances the morale of the employees.
 It increases the acceptance of management’s ideas.
 It increases cooperation between management and employees.
 It leads to a reduction in the number of complaints and grievances.
Disadvantages of democratic leadership
 It accounts for slow decisions, diluted accountability for decisions.
 There may be possible compromises that are designed to please everyone but does not give
the best solution.
Free-Rein Leadership:
The leader allows the employees to make the decisions, however, the leader is still
responsible for the decisions that are made
  The leadership style which allows maximum freedom to followers may be called
free-rein leadership. It gives employees a high degree of independence in their
operations.

 A free rein leader completely abdicates his leadership position, to give all
responsibility of most of the work entrusted to him to the group which he is
supposed to lead, limiting his authority to maintain the contact of the group with
persons outside the group.

 This is also known as the permissive style of leadership.

Advantages of free rein leadership
 Opportunity for individual development is offered to group members.
 All persons are given a chance to express themselves and to function relatively
independently.
Disadvantages of free rein leadership
 It may result in a lack of group cohesion and unity toward organizational objectives.
 Without a leader, the group may have little direction and a lack of control.
 The result can be inefficiency or even worse, chaos.
CONTROLLING
 The control process is the system that allows setting, measure, match and tweak any
business activities such as production, packaging, delivery and more
 Controlling is an essential part of management process.
 In fact; without the control process entire management is obsolete. Because you will not
be able to know how your plan is working, is it fully implemented.
4 Steps of Control Process are;
1. Establishing standards and methods for measuring performance.
2. Measuring performance.
3. Determining whether performance matches the standard.
4. Taking corrective action.
These steps are described below;

1. Establishing Standards and Methods for Measuring Performance

 Standards are, by definition, simply the criteria of performance.
 They are the selected points in an entire planning program at which performance is
measured so that managers can receive signals about how things are going and thus do
not have to watch every step in the execution of plans.
 Standard elements form precisely worded, measurable objectives and are especially
important for control.
 In an industrial enterprise, standards could include sales and production targets, work
attendance goals, safety records, etc.
 In service industries, on the other hand, standards might include several time customers
have to wait in the queue at a bank or the number of new clients attracted by a revamped
advertising campaign.
2. Measuring the Performance
 The measurement of performance against standards should be done on a forward-looking
basis so that deviations may be detected in advance of their occurrence and avoided by
appropriate actions.
 Several methods are used for measuring the performance of the organization.
 If standards are appropriately drawn and if means are available for determining exactly
what subordinates are doing, appraisal of actual or expected performance is fairly easy.
 But there are many activities for which it is difficult to develop accurate standards, and
there are many activities that are hard to measure.
 It may be quite simple, for example, to establish labor-hour standards for the production
of a mass-produced item and it may be equally simple to measure performance against
these standards, but in the less technical kinds of work.
 For example, controlling the work of the industrial relations manager is not easy because
definite standards cannot be easily developed.
 The superior of this type of manager often rely on vague standards, such as the attitude of
labor unions, the enthusiasm, and loyalty of subordinates, the index of labor turnover
and/or industrial disputes, etc. In such cases, the superior’s measurements are often
equally vague.
3. Determining whether Performance Matches the Standard
 Determining whether performance matches the standard is an easy but important step in
the control process. It involves comparing the measured results with the standards already
set.
 If performance matches the standard, managers may assume that “everything is under
control”. In such a case the managers do not have to intervene in the organization’s
operations.
4. Taking Corrective Action
 This step becomes essential if performance falls short of standards and the analysis
indicates that corrective action is required. The corrective action could involve a change
in one or more activities of the organization’s operations.
 For example, the branch manager of a bank might discover that more counter clerks are
needed to meet the five-minute customer-waiting standard set earlier.
  Control can also reveal inappropriate standards and in that case, the corrective action
could involve a change in the original standards rather than a change in performance.
 It needs to be mentioned that, unless managers see the control process through to its
conclusion, they are merely monitoring performance rather than exercising control.
 The emphasis should always be on devising constructive ways to bring performance up to
a standard rather than merely identifying a past failure.
ESSENTIALS OF AN EFFECTIVE AND EFFICIENT CONTROL SYSTEM:
1. Simplicity 2. Objectivity [Link] [Link] [Link] [Link] [Link]
[Link]-looking Nature 9. Focus on Strategic Points 10. Motivating and Others.
1. Simplicity:
A good control system must be simple and easily understandable so that all the managers can
apply it effectively.
2. Objectivity:
The standards of performance should be objective and specific, quantified and verifiable. They
should be based on the facts so that control is acceptable and workable.
3. Promptness:
The control system should provide information soon enough so that the managers can detect and
report the deviations promptly and necessary corrective actions may be taken in proper time.
Corrective measures are of no value if those are taken too late.
4. Economy:
The control system must justify the expenses involved. In other words, anticipated earnings from
it should be greater than the expected costs in its working. A small organisation cannot use the
expensive control technique applied in large enterprises.
5. Flexibility:
Internal goals and strategies must be responsive to the changes in the environment and the
control system should be flexible enough to adapt the changing conditions or unforeseen
situations. It should be adaptable to the new developments. Flexibility in control system can be
introduced by making alternative plans.
6. Accuracy:
The control system should encourage accurate information in order to detect deviations. The
technique of control used should be appropriate to the work being controlled.
7. Suitability:
Control must reflect the needs and nature of the activities of the organization, The control system
should focus on achieving the organizational goals.
8. Forward-looking Nature:
The control system must be directed towards the future. It must pay attention on how the future
actions can be conformed with the plans adopted.
9. Focus on Strategic Points:
The control system should focus attention on strategic or critical deviations. Only exceptional
deviations require the attention of the managers.
10. Motivating:
A good control system should pay due attention to the human factor, It should be designed to
secure positive action from the workers. Self-control tends to be motivated. Direct contact
between the controller and the controlled also helps in making the control system motivational.
11. Reflection of Organization Pattern:
Control must reflect organization pattern. Since the events are controlled through people, it is
essential that controls must conform to the organization pattern. The control process should be
acceptable on the psychological front.
12. Corrective Action:
Control system must ensure corrective actions. An adequate control technique should not only
detect the deviations and failures, but should also disclose where they are occurring; who is
responsible for them; and what should be done to correct them.
Importance of Controlling in Management
Controlling is one of the most important functions of management as it helps in making sure
whether all the activities are going in accordance with the predetermined goals and taking the
remedial measures wherever required.
1. Accomplishing Organizational Goals The process of controlling helps in accomplishing
organizational goals or objectives. The controlling guides the activities ot subordinates in
achieving the goals. It ensures the use of human and material resources in the best possible
manner so that there may be pre-determined objectives of the organization.
2. Judging Accuracy of the Standards A manager compares the actual work performance with
the standards while performing the function of control. He tries to find out whether the accuracy
of the standards is not more or less than the general standards. In case of the needs, they are
redefined.
3. Improves Efficiency The organization sets the goal for the future which is not certain So,
controlling is the way which focuses on uncertainty and to attain the goals. Regular control
snows the deviation in plan and actual achievement which helps to keep the staffs on the right
track.
4. Improve Employee Motivation : Motivation is defined as the process of inspiring someone
tor doing something. Controlling makes all the employees work with complete dedication as they
know that their work performance will be evaluated. Their identity will be established if the
progress report is satisfactory in the organization.
IMPORTANCE OF CONTROLLING:
1. Control improves Goodwill
Quality control improves the quality of the products. Cost control decreases the cost of the
products. Therefore, the organization can supply good quality products at lower prices. This
increases the goodwill of the organization.
2. Control minimizes Wastage
Control helps to reduce the wastage of human, material and financial resources. This increases
the profits of the organization.
3. Control ensures optimum utilization of resources
Control helps the organization to make optimum utilization of the available resources. This also
increases the profit of the organization.
4. Control helps to fix responsibility
Control helps to fix responsibility of a particular job on a particular person or a particular
department. So, if there are any mistakes then a particular person or a particular department will
be held responsible for it.
5. Control guides operations
Control fixes certain standards. All the work has to be done according to these standards. So
control, acts like a traffic signal. It guides all the operations of the organization in the right
direction.
6. Control motivates employees
In control, the employees' performances are evaluated regularly. Those who show good
performances are rewarded by giving them promotions, cash prizes, etc. This motivates the
employees to work hard, and it also improves their morale.
7. Control minimizes deviations
Control minimizes the deviations between a planned performance and actual performance.
8. Control facilitates Delegation
Control helps the superiors to evaluate the work of their subordinates. So, the superior can
concentrate on the very important work, and they can delegate the less important work to their
subordinates. Thus, it facilitates delegation.
9. Control facilitates Co-ordination
Control facilitates co-ordination between the different departments of the organisation.
Whenever, there are any deviations, different departments come together to take collective and
corrective steps.
10. Control increases efficiency
Efficiency is the relation between returns and cost. If there is a high return at low cost then there
is efficiency and vice-versa. Control leads to high returns and low cost. Therefore, it increases
efficiency
COORDINATION:
Co-ordination is the process whereby an executive develops an orderly pattern of group efforts among
his subordinates and secures unity of actions in the pursuit of a common purpose.
FUNCTIONS OF COORDINATION:
Co-ordination is an integral element or ingredient of all the managerial functions as discussed
below: -
a. Co-ordination through Planning - Planning facilitates co-ordination by integrating the
various plans through mutual discussion, exchange of ideas. e.g. - co-ordination between
finance budget and purchases budget.
b. Co-ordination through Organizing - Money considers co-ordination as the very
essence of organizing. In fact when a manager groups and assigns various activities to
subordinates, and when he creates department’s co-ordination uppermost in his mind.
c. Co-ordination through Staffing - A manager should bear in mind that the right no. of
personnel in various positions with right type of education and skills are taken which will
ensure right men on the right job.
 d. Co-ordination through Directing - The purpose of giving orders, instructions &
guidance to the subordinates is served only when there is a harmony between superiors &
subordinates.
e. Co-ordination through Controlling - Manager ensures that there should be co-
ordination between actual performance & standard performance to achieve organizational
goals
Differences between Co-ordination and Co-operation
Basis Co-ordination Co-operation

Meaning It is an orderly arrangement of group It means mutual help willingly.

efforts in pursuit of common goals.

Scope It is broader than co-operation which It is termed as a part of co-ordination.

includes as well because it harmonizes
the group efforts.

Process The function of co-ordination is The functions of co-operation are prepared

performed by top management. by persons at any level.

Requirements Co-ordination is required by employees Co-operation is emotional in nature

and departments at work irrespective of because it depends on the willingness of
their work. people working together.

Relationship It establishes formal and informal It establishes informal relationship.

relationships.

Freedom It is planned and entrusted by the It depends upon the sweet will of the
central authority & it is essential. individuals and therefore it is not
necessary.

Support It seeks wholehearted support from Co-operation without co-ordination is

various people working at various fruitless & therefore it may lead to
levels. unbalanced developments.

TYPES OF COORDINATION :
i. Vertical Coordination
ii. Horizontal Coordination
iii. Internal Coordination
iv. External Coordination
i. Vertical Coordination:
Vertical coordination is the coordination between different levels of the organization to ensure
that all levels of organization are in harmony with the organizational policies and programmes.
This is achieved through delegation of authority by directing and by controlling.
ii. Horizontal Coordination:
Horizontal coordination is the coordination between departments on the same level of managerial
hierarchy. Coordination between production and marketing departments at the same level or
organizational hierarchy is an example of horizontal coordination. This is achieved by forming
cross-functional teams and self-managed teams.
iii. Internal Coordination:
Vertical and horizontal types of coordination, if carried out within an organization, are called
internal coordination. Internal coordination is achieved
iv. External Coordination:
 Success or failure of an organization also depends on number of external forces. No
organization can operate in isolation, it has to continuously interact with dynamic
environmental forces and devise its strategies to respond to such forces to survive.
 External coordination facilitates such process by integrating the organization with the
dynamic external forces. For effective external coordination, an organization at the outset
has to know what the pertinent external forces are.
 After such identification, the organization has to analyse their potential impact and take
suitable remedial to preventive measures to cope with the same. Important external forces
may be the changing expectations of stakeholders (like suppliers, customers, investors,
employees or even the society) or changing competitive situation, technological
advancement, changing government policies and regulations, etc.
 To facilitate external coordination, a number of techniques are adopted by an
organization. New management concepts like, customer relationship management
(CRM), which aligns organization with the customers, supply chain management (SCM),
which increases market share and multiply customer satisfaction, etc., have now been
developed for more effective external coordination.
TECHNIQUES OF COORDINATION:
i)Coordination through Effective Supervision:
Supervision ensures harmonious and reciprocal performance of subordinates. It also
synchronizes and coordinates subordinates’ efforts both among themselves and in relation to
other groups. Such collaborative efforts of individuals and groups to achieve organizational
objectives are possible through coordination, which again is best achieved through supervision.
ii)Coordination through Organizational Process:
Suitable organizational process achieves coordination. Proper grouping of activities, assignment
of job to the subordinates, proper authority delegation, etc., are parts of the organizational
process, which helps in achieving coordination.
iii)Coordination through Personal Contact:
Another important technique of achieving coordination is through personal contact. Personal
contact reciprocally relates one function with another and this is achieved through the
development of interpersonal and horizontal relationships of people working in the organization.
This promotes cooperation and collaboration due to mutual understanding; hence, coordination
through personal contact is significant for realizing the objectives of an organization.
iv)Coordination through Effective Communication:
Transparency through communication achieves coordination. Keeping people in the organization
informed time to time about the internal and external changes is essential to make them
understand the changed situation arid coordinate their efforts to achieve intended goals.
Communication can be made through letters, documented procedures, reports, bulletins and also
through personal behaviour of managers.
Communication does the important task of dovetailing information for the benefit of the
organization. People react to the communication quickly, provided it is properly coordinated.
This is why effective communication is considered to be an important technique of coordination.
v)Coordination by Group Meetings:
Henry Fayol pointed out that lack of coordination is more visible when each department knows
nothing about others or fails to relate them to the organization as a whole. This is primarily for
the existence of water tight compartments for the traditional hierarchical structure, where people
lack initiative and loyalty.
To eliminate such a situation, coordination is essential which can be best achieved by periodic
group meetings and conferences of departmental heads. Group meetings help people to
understand the organizational needs better.
It helps them to exchange ideas, know about plans and activities of their department and so also
the organization as a whole. Proper coordination, therefore, is best achieved through group
meetings, and this is why group meetings are considered to be an important technique of
coordination.
vi)Coordination through Liaison Officers:
Particularly for large organizations, direct personal contact of managers of various units and
functions may not be very frequent. Such gap is often filled by the organizations through liaison
officers. Therefore, also by appointing liaison officers, an organization seeks to achieve
coordination.