Chapter 3

Managerial Functions – II
❖ Motivation– Concept, Importance, Influencing factors. Importance of
Communication in Organizations, Barriers of Communication.
❖ Leadership and Team Building - Concept, Functions, Styles, Qualities
of a good leader, Indoor, Outdoor & a Virtual Team Building
Exercises
❖Controlling – Concept, Steps, Essentials of good control system,
Specimen Layout of KPIs/OKRs-Techniques of Controlling - PERT,
CPM, Budgetary Control.

MOTIVATION
CONCEPT OF MOTIVATION

The term 'motivation' has been derived from the word 'motive'. Motive refers to
the inner drive or intention that makes a person to do something or to behave in
a certain way.

In the words of Michael Jucious "Motivation is the act of stimulating someone

or oneself to get a desired course of action, to push the right button to get a
desired reaction."
The following are the FEATURES of motivation:

1. Motivation is an act of managers: Motivation is one of the important aspects

of management. Managers motivate their subordinates by providing monetary
and/or non-monetary incentives.

2. Motivation is a continuous process: Motivation is not a one-time process.

This is because, human needs and desires are never ending. When one need is
satisfied, another need emerges that is to be satisfied. Therefore, managers have
to identify the emerging needs of their subordinates and strive to satisfy such
needs at regular intervals.

3. Motivation can be positive or negative: There can be positive motivation and

negative motivation. Positive motivation can be stimulated by providing positive
incentives, such as higher pay, power, position, etc. Negative motivation implies
the use of penalties, punishments, etc.
4. Motivation is goal oriented: Motivation is a behavioural concept. It directs
human behaviour towards the accomplishment of goals. If properly motivated,
employees put in their best possible efforts in order to achieve the desired goals.
5. Motivation is complex in nature: Different individuals behave differently to
a given set of incentives. Some employees may be highly motivated when they
are given monetary incentives, whereas, others may be more motivated with the
use of non-monetary incentives. Again, one person may prefer monetary benefits
at times, and at other times he may easily get motivated with non-monetary
incentives. Therefore, managers must constantly study human behaviour at work
in order to provide right set of incentives.

6. Motivation is an art: Motivation is an art to encourage and influence

subordinates to put in their best efforts. Given the same set of incentives, two
different managers may produce different results with the same group of
individuals. One manager may be able to easily motivate the subordinates,
whereas, the other manager may have to put extra efforts to motivate the
subordinates.

7. Motivation is system-oriented: Motivation is a combined effect of three

groups of factors:
• Forces operating within an individual, i.e., is nature, needs, values, etc.
• Forces operating within the organisation, i.e., the organisation structure,
superior-subordinate relations, broke nature of job, working conditions,
etc.
• Forces operating in the external environment, i.e., culture, customs,
religion, values of the society, etc.
8. Motivation is different from job satisfaction: Motivation is the act to satisfy
needs and desires. Job satisfaction results only when such needs and desires are
fulfilled. Job satisfaction is the outcome of motivation.

IMPORTANCE OF MOTIVATION
Motivation is vital in any organization. Employees are motivated to perform
effectively by providing them monetary and non-monetary incentives. The
following are the advantages of motivation:
1. Higher Efficiency: Motivation helps to generate higher efficiency in the
organization. When employees get incentives, they are motivated to perform with
commitment and dedication. This in turn improves efficiency of the employees.

2. Innovation: Motivation enables employees to come up with innovative ideas.

Innovation helps an organization to gain competitive advantage in the market.

3. Corporate Image: Due to motivation, the overall performance of the

employees improves. Improved performance enables the firm to get higher
results. This in turn enhances corporate image of the firm in the minds of
shareholders, customers, and other members of the society.

4. Team Work: Motivation helps to develop team work in the organization. When
team incentives are given to the employees, they are motivated to work as a team,
which in turn improves overall performance of the organization.
5. Optimum use of Resources: Motivation helps to make optimum use of
resources. employees work with application and dedication. They make optimum
use of physical and capital resources.
6. Reduction in Absenteeism: Motivated work force remains less absent. There
is a direct relationship between motivation and reduction in absenteeism.
Motivated employees are not only less absent, but they may even work for extra
hours, if the situation so demands.
7. Reduction in Labour Turnover: Labour turnover takes place when
employees leave the organization and join some other place. Quite often, lack of
motivation results in higher labour turnover and vice-versa.
8. Better Relations: Motivation enables better relations in the organization.
Motivated workforce work with team spirit, which in turn leads to better relations.
Better relations enable the organization to generate higher efficiency.

9. Improved Morale: Morale is a general term that describes overall group

satisfaction. Proper motivation results in improved morale of the employees.
Employees work with commitment and dedication when their morale is high.
Even the best of the employees may create problems or make mistakes, when
their morale is low.
 10. Reduction in Wastages and Breakages: Motivated employees take utmost
care in handling machines, materials and other resources. This would reduce
wastages and breakages. Demotivated employees may deliberately waste
materials and may even damage or break machines and equipments.
11. Reduction in Accidents: Motivated workers work with care and
concentration. They follow safety rules and regulations. Therefore, there are less
chances of accidents, even in accident prone areas.
12. Other Benefits: There are several other benefits of motivation: Increased job
satisfaction to the employees.
• Helps to overcome resistance to change.
• Develops positive attitude of the employees.
• Competitive advantage to the organisation.

FACTORS INFLUENCING MOTIVATION

Clarence Francis, the former Chairman of General Foods (USA) once remarked
"You can buy a man's time; you can buy a man's physical presence at a given
place.... but you cannot buy his initiative, you cannot buy loyalty, you have
to earn these things."
There are several factors that motivate a person to work. The motivational
factors can be broadly divided into two groups as follows:
MOTIVATIONAL FACTORS
MONETARY FACTORS NON-MONETARY FACTORS
• Salaries and Wages • Status
• Bonus • Appreciation
• Incentives, ... • Delegation

I. Monetary (Financial) Factors:

1. Salaries or Wages: Salaries or wages is one of the most important motivational

factors. Reasonable salaries must be paid and on time. While fixing salaries, the
organisation must take into consideration a number of factors such as:
• Cost of living.
• Company's ability to pay.
• Capability of the employee, etc.

2. Bonus: It refers to extra payment over and above salary given to an employee
as an incentive. The employees must be given adequate rate of bonus.
Normally, bonus is paid once in a year. However, now-a-days, some organisations pay
monthly bonus along with their monthly pay. Bonus does motivate the employees
to
a certain. extent to perform better.

3. Incentives: The organisation may also provide additional incentives, such as

medical allowance, leave travel allowance, house rent allowance, educational
allowance, recreation allowance, and so on.

4. Special Individual Incentives: The Company may provide special individual

incentives. Such incentives are to be given to deserving employees for giving
valuable suggestions, or for special efforts on the part of the employee.

II. Non-Monetary (Non-Financial) Incentives:

Apart, from financial incentives, there are non-financial factors that can play a
significant role in motivating the employees:
1. Status or Job Title: By providing a higher status or designation, the
employee can be motivated. For instance, it is advisable to designate a service
mechanic with the designation titled as "service engineer". Employees prefer and
are proud of higher designations.
2. Appreciation and Recognition: Employees must be appreciated for their
services. The praise should come not only from the immediate superior but also
from higher authorities, especially in the case of special achievement."
3. Delegation of Authority: Delegation of authority motivates a subordinate to
perform the tasks with dedication and commitment. When authority is
delegated, the subordinate knows that his superior has placed faith and trust in
him, and as such he may be devoted to his job.
4. Working Conditions: Provision for better working conditions, such as good
lighting, good ventilation, proper sanitation, air-conditioned rooms, proper
plant or office layout, compact and convenient machines and equipment, proper
rest pauses, etc., motivates the employees.

5. Job Security: Guarantee of job security or lack of fear of dismissal, etc., can
also be a good way to motivate employees. Employees who are kept temporarily
for a long time may be frustrated, and they may leave the organisation.
6. Job Enrichment: Job enrichment refers to vertical expansion of job. Job
enrichment involves providing more challenging tasks, and responsibilities. For
instance, an executive who is involved in preparing and presenting reports of
performance, may also be asked to frame plans. This would make the job of the
employee more meaningful and satisfying.

7. Workers Participation: Inviting the employee to be a member of the quality

circle, or a committee, or some other form of employee participation can also
motivate the work-force.
8. Other Factors: There are several other factors of motivating the employees:
• Providing training to the employees.
• Proper job placement.
• Proper promotions and transfers.
• Proper performance evaluation and feedback, etc.
• Flexible working hours, if possible.
• Proper welfare facilities such as canteen, recreation centers, etc.

COMMUNICATION
Importance of Communication in Organizations are as follows: The
medium of communication can be broadly divided into two groups:
• Verbal Communication
• Non-Verbal Communication

Verbal Communication: Words are used to communicate verbally. The

verbal communication is divided into two groups - Oral Communication
and Written Communication.
I. Importance of Oral Communication: Oral communication takes place
in various forms such as discussion, phone conversation, presentations,
instructions, etc. The importance of oral communication over written
communication are:

[Link] Feedback: In a face-to-face situation, the speaker can

immediately get the feedback from the listener. The speaker can get the
instant response from the listener whether he has understood the message or
not, or whether the message is creating a favourable impression on the
receiver or not. Depending upon the feedback, the speaker can mould or
adjust his message to suit the requirements of the receiver or audience.
2. Persuasive in Nature: Oral communication can be persuasive in nature.
The speaker can judge the reactions or response of the audience, and
accordingly can shift his arguments or may provide clarifications, so as to
persuade and induce the recipient of the message to accept the message and
to act accordingly. Therefore, oral communication can play an important
role, when serious or important matters are involved.

3. Confidential Information: The speaker can communicate confidential

and secret information to the listener on one-to- one basis. The confidential
and secret information may not be put in writing as other persons such as
secretary and others who get in touch with written communication may
come to know of such secret or confidential information.

4. Saves Time: Oral communication is less time consuming. In a number of

cases, where quick action is required, oral communication is advisable. In
one minute, a person can speak about 125 to 150 words, but can write about
20 to 25 words in a minute, and type about 30 to 40 words per minute. Words
can be easily understood as soon as they are spoken, however, it takes time
to read written messages.

5. Less Expensive: Oral communication is less expensive as compared to

written communication. Oral communication does not involve expenditure
on stationery, and other equipment such as computer and printer. Also, if
we accept the notion that time is money then oral communication saves
money by saving time.

II. Importance of Written Communication

1. Legal Evidence: The written communication can be used as legal

evidence in the court of law. When the written communication bears the
signature of the sender/writer, then it can be used as legal evidence, if need
be.

[Link] Record: Written communication can be preserved as a

permanent record of the organisation. If need be, it can be referred in future
for decision-making.

3. Accurate and Precise: Written communication is accurate and precise.

This is because; the writer takes care to see to it that all relevant information
is provided. The written communication is also precise in nature. In written
 communication, the writer or sender can provide clear and specific
information.

4. Wide Circulation: It can be widely circulated throughout the

organisation, or in all the branches or divisions of the organisation, if need
be.
5. Fixing of Responsibility: It is possible to fix responsibility in case of
written communication. This is because; written communication comes in the
form of a written record along with the signature of the sender/writer. The
writer/sender can be held responsible for the contents of the written
communication.

III. Importance of Non-Verbal Communication: Non-verbal

communication takes place through signs, pictures, visuals, body language,
charts and graphs, etc. The importance of non-verbal communication is
explained as follows:
1. Attracts Attention: Non-verbal communication attracts attention of the
listeners. For instance, the colour combination in the visuals can attract
attention of people. Once, the attention of the person is attracted, he may be
more interested in the communication. Also, in the case of audio/sound signals,
people's attention can be attracted through the sound of a bell, sirens, etc.
[Link] Recall: Non-verbal communication aids in retention and recall of the
message or instructions. For instance, a visual poster sign, charts, maps, etc.,
creates more memory impact. Therefore, the audience tends to remember and
recall the communication.
3. Creates Impact: Non-verbal communication creates a good impact on the
speaker as well as on the listener. For instance, effective body language of the
speaker such as gestures and facial expression can create a good impact on the
listener. Also, good body language on the part of listener motivates the speaker
to put his/her views and ideas across to the listener more convincingly.
4. Develops Relations: Non-verbal communication can also develop good
relations between the speaker and the listener. For instance, body language
brings personal touch to the communication. A good facial expression is a sign
of friendship, warmth and happiness.
5. Educational Value: The visual signs have an educational value, especially,
 for the illiterate persons. For instance, the sign of non-smoking (a cross mark
against a cigarette) can be easily understood by an illiterate person. Also, the
visual signs act as a reminder even to the literate persons.

BARRIERS TO EFFECTIVE COMMUNICATION

One of the main problems in business organisation is the problems or barriers to
communication. The barriers or problems may arise anytime during the
communication process. The barriers may be the due to any of the components of
the communication process · sender, the receiver, the medium and the
environment.

The various barriers to communication are broadly divided into five groups as
listed below:
BARRIERS TO COMMUNICATION
⬇
⬇ ⬇ ⬇ ⬇ ⬇
Physical Semantic Organisational Socio- Psychological Cross-
cultural

I. PHYSICAL OR ENVIRONMENTAL BARRIERS

[Link]: It is any factor that confuses, disturbs, diminishes or interferes with

communication. The noise can originate with the sender, the transmission, or the
receiver. For example:
• Encoding may be defective because of use of ambiguous words.
• Transmission may be interrupted by electrical discharges in the
atmosphere that interferes with radio, TV, or telephonic messages.
• Decoding may be defective because the wrong meaning may be attached
to symbols or words.
• A disturbance or noise in the environment (such as noise of machines in
a factory, traffic noise, etc.) may hinder the development of a clear
thought or listening of the message, etc.
2. Defects in Communication System: Communication gets affected if there
is a defect in the communication system. For example, there can be defect in the
address system, which hinders the clarity of communication, or there can be
failure of electricity because of which address system becomes inoperative.

3. Time and Distance: Time and distance act as a barrier to communication.

For instance, there can be a communication gap between two persons working
in two different shifts or at two different places unless they communicate
through digital media.

4. Wrong Selection of Medium: There can be communication problems when

there is a wrong selection of the medium by the sender. The receiver of the
message may not be familiar with the use of medium. For instance, workers in
a factory may not be familiar with the use of charts or maps, and as such they
may not understand the communication conveyed through such visual aids,
unless they are taught to do so.
5. Temperature and Humidity: A high temperature and humidity can cause
environmental stress on the part of both the sender and receiver of the message.
For instance, a lecturer may not be able to communicate or lecture effectively
to the students when there is high temperature and humidity and the students
also may find it difficult to listen effectively.

II. SEMANTIC OR LANGUAGE BARRIERS CADRO JE Semantic

barriers occur due to differences in meaning attached to words or signs used
in communication. The following are the semantic barriers:

1. Misinterpretation of Words: It is possible that the receiver of the message

may not attach the same meaning as intended by the sender. There are number
of words that can be interpreted differently by different persons. For instance,
words like 'cheap, DE run, baby, sex, love, value, memo, taste, and so on can
be interpreted with different meanings by different persons at different times
and at different places. The multiplicity of meaning may lead to
miscommunication. Therefore, the sender must be in a position to use simple
and clear words that can have the intended meaning to the receiver.

2. Difference in Language: Different languages may have different meanings

to the same word. For instance, the English word 'more' can have a different
meaning in Tamil language i.e., curd. There are number of such instances
when certain words or phrases when translated in another meaning give a
different meaning altogether. For instance, the headline in an advertisement
"Come Alive with .....Freshness was translated in Japanese language, which
brought out the meaning as 'Come out of the Grave'.
3. Use of Jargon: Jargon refers to specialized or technical language, which is
limited to a group of persons doing the same work or profession. The jargon has
a special meaning for the group but may have some other meaning to others.
The use of jargon may confuse the receiver of the message if he/she is not
familiar with such jargon. Therefore, if jargon is used, the sender must clarify
it's meaning or may avoid using jargons.
4. By-passed Instructions: By-passed instructions take place when a person or
a group attribute different meaning to a word or a phrase used by some other
person or a group. For instance, a subordinate may attribute a different meaning
to a particular word or sentence used by the superior, and as such there can be
miscommunication between the two.
III. ORGANISATIONAL BARRIERS
All the above-mentioned barriers can exist in an organisation. However, there are
certain barriers, which are specific to business organizations. They are as follows:
1. Status Barrier: Status consciousness is one of the major barriers to effective
communication. It can exist in any organisation. The status consciousness
becomes a major barrier in face-to- face communication between the superior and
the subordinate. The subordinate may feel awkward, afraid or communicate
effectively with the boss, and the boss may dictate his terms to the subordinate
without properly listening to the point of view of the subordinate.
2. Information Overload: There are instances, when too much of information
can create a barrier to effective communication. People respond to information
overload in a number of ways –
(a) They may ignore certain information.
(b) People may make errors in processing the information.
(c) People may delay processing the information.
(d) They may filter the information.
(e) People may totally ignore all the information or withdraw from the task
of communicating.

3. Lack of Planning: Good communication rarely happens by chance. People

often start communicating without proper thinking, planning, and stating the
objective of the message. A good deal of planning is required for effective
communication in business organizations. The communicator should select the
right medium, use the right words, and communicate at the right time so as to
achieve the communication objectives.
4. Goal Conflicts: There may be goal conflicts within the organisation. Different
departments or units may have their individual goals which may conflict with that
of the other departments or units.
For instance, there can be a goal conflict between the production department and
the
marketing department. The production department may prefer to produce more
of
Product X, whereas, the marketing department may have the goal to sell more of
Product Y. Such goal conflicts can lead to serious. communication problems in
an
organisation.
5. Offensive Style of Communication: Some people may have offensive or
rude style of communication. The offensive style of communication often
spoils relations in the organisation, and communication often fails to achieve
its objectives. Therefore, superiors and others in an organisation must use
persuasive style of communication.

IV. PERSONAL OR SOCIO-PSYCHOLOGICAL BARRIERS

There are certain barriers that exist in the minds of the persons involved in
the process of communication. The following are the socio-psychological
barriers:
1. Different Perceptions: People have different perceptions, which can act
as a barrier in communication. For instance, a student may sit in the classroom
in a relaxed manner, which may be perceived by the teachers differently. One
teacher may feel that the student is not interested in the lecture, whereas,
another teacher may think that the student is quite interested in the lecture.
The different perceptions occur due to level of confidence, relations between
the sender and receiver of the message, past experiences, etc.
2. Closed Mind: There are some people who think and believe that they know
everything about a particular topic or subject Sub and as such will close their
mind to the topic being discussed, even though some new facts may be
discussed. Closed mind can be a great barrier in communication. To break
this barrier, people must admit to themselves that there is always a room to
learn new things and as such learn to listen attentively with an open mind.
3. Poor Retention: Poor retention on the part of the recipients of the message
acts as a barrier to effective communication. Quite often, a good amount of
oral instructions are not retained. Therefore, there is a need to have written
communication, especially in the case of important and urgent matters.
4. The Halo and Horn Effect: The listener or the receiver of the message may
develop halo or horn effect towards the speaker or sender of the message. Halo
effect refers to splendour glory bestowed on a famous or revered person. Horn
effect is the opposite of halo effect. If the listener has halo effect towards the
speaker, then he trusts the speaker and everything the speaker says appears true
and vice-versa.
5. Emotions: The emotions of a person whether sender or receiver of the
message
affects the communication process. For instance, if the sender is angry, worried
or
excited, then his thinking process will be affected and he will not be in a position
to
organize the message properly.
Emotional disturbances also affect the receiver of the message and he may not
pay proper attention to the message or he may not understand the message
properly.
6. Slanting: Slant means to distort in writing or telling. The receiver may distort
the message, especially when he communicates the same to some other person.
He may colour the message as per his own interpretation and prejudice.
For example, in a firm, the top management informed the superiors to tell the
workers that 'lunch breaks to be strictly adhered to'. The message was slanted
or distorted, as 'workers should eat to their full satisfaction'.

7. Filtering: In this case the sender of the message manipulates information in

such a way that it appears more favourably to the receiver. Due to filtering, the
receiver does not get objective or proper information.

For instance, a subordinate when reporting to his superior may hold back some
unfavourable information and convey only favourable information, which he
thinks the boss may like to hear. As a result of this the superior may not get exact
or correct to information.

8. Wrong Assumptions: The participants in the communication no process may

make wrong assumptions, which can create a barrier to effective communication.
There are chances that the assumption made by the sender may be different from
that of the receiver.

For instance, a person may make an assumption of another to be lazy because he

does not shave regularly. This may not be the right assumption.

9. Impatience: Nowadays, people are impatient. They often communicate hastily

or listen impatiently. The listener may react instantly even before the
communication is completed. Impatience can occur on the part of the sender
and/or the receiver of the message. To avoid this barrier, the only alternative is to
have patience both with the sender as well as with the receiver of the message.

10. Rambling: It refers to talk or write aimlessly, without connection of ideas. If

the message is not planned properly, then there can be rambling on the part of the
sender. Rambling We can occur in the receiver of the message when his mind
gets distracted. He may be physically reading or listening but mentally his mind
may be switched off.
11. Unsolicited Communication: Unsolicited communication has to face greater
barriers than solicited communication. For instance, a person may not pay
attention to the advice given when not called for. However, if advice is sought,
then he may pay attention to what is being advised. This means people are
unresponsive to communication if it is unsolicited.

V. CROSS-CULTURAL BARRIERS
Culture refers to ideas, customs, skills, arts, rituals, ceremonies, etc., of a people
or a group that are transferred or passed along from one generation to another. In
India, there are varied cultures. This cultural diversity may act as one of the
barriers to communication. Again, there can be cultural differences across the
countries. Words, symbols, actions, colours, etc., may have different meanings in
different cultures. The conveyor of the message must clearly understand the
cultural nuances of the receiver and communicate accordingly. Some of the
cultural barriers are as follows:
1. Colours: Different cultures may attach different meanings to colour. For
instance, 'green colour' may signify freshness in some countries, whereas, it may
signify sickness in some other countries.
2. Body language may have different meaning in different parts of the globe. For
instance, nodding head sideways may mean disagreement in some countries,
whereas, it may mean agreement in some other countries. A thumb up is a positive
sign in India, but it is a negative gesture in Greece.
3. Proxemics: It refers to the space between people. In some cultures, close
distance indicates warmth and friendship, whereas, in some other cultures, it
indicates just the opposite.
4. Time: There are certain cultural perceptions of the time factor A person in hurry
may be considered as a sign of activeness in Sail United States of America, but in
African countries, it may be a sign of arrogance or rudeness - where the person has no
time Bord for others.
5. Other Cultural Barriers: There are also other cultural barriers such as food serving
and eating habits, dress styles, manners etc.
 LEADERSHIP

CONCEPT OF LEADERSHIP

Leadership is one of the important aspect of management. Effective leadership

is required to lead and guide the subordinates to perform organisational tasks
effectively and efficiently.
In the words of George Terry "Leadership is the activity of influencing people
to strive willingly for group objectives." In the words of Peter Drucker,
"Leadership is not making friends and influencing people, i.e, salesmanship. It
is the lifting of man's visions to higher sights, the raising of man's performance
to higher standards, the building of man's personality beyond its normal
limitations."
Alford and Beatty define, "Leadership is the ability to secure desired actions
from a group of followers voluntarily, without the use of coercion."

Nature and Characteristics:

1. Presence of followers: A leader needs to have followers. The leader cannot
exercise leadership, if there are no followers. A person can be called a leader
only when people gets influenced by him, and agree to accept as their leader.

2. Common interest: There must a common interest for the leader and for the
group. If there is clash in interest, then the group may leave the leader and
follow some other person who shares their common interest. Therefore, the
interest of the leader and that of his followers must match.

3. Willing cooperation: Through effective leadership, the leader should

influence his followers and secure willing cooperation from them, in order to
achieve group goals. A good leader would never force his subordinates to obey
him, and compel them to do certain acts.
4. Discipline: A good leader sets a good example for his followers. Lyndall
Urwick once remarked, "It does not matter much what a leader says, still
less what he writes, that influences subordinates. It is what he is. And they
judge what he is by what he does and how he behaves." Therefore, a good
leader needs to be disciplined (committed and dedicated).
5. Dynamic process: Leadership is a dynamic and continuous process of
influencing behaviour of others. It is not enough to influence the followers only
once. There is a constant need for influencing the followers.
6. Active participation: There must be a working relation between the leader
and followers. The leader not only needs to secure active participation of his
followers, but he also, needs to take active part in the activities of the group.
7. Superior knowledge and skills: The leader is expected to have he superior
knowledge and skills as compared to his subordinates. Otherwise, the followers
may not respect and obey the leader. In other words, if the leader does not
possess superior knowledge, then he will not be able to exercise leadership over
his followers.
8. Goal Oriented: Leadeship is goal oriented. The purpose of leadership is to
achieve some desired goals. It does not make any sense to be a leader of a group
without any purpose to achieve.
9. Leadership Styles: There are different leadership styles. However, good
leaders would follow situational leadership style.

10. Continuous Process: Leadership is a continuous process. It is an ongoing

activity of influencing subordinates or followers to achieve group objectives.

FUNCTIONS OF LEADERSHIP

The importance of leadership is reflected in the following functions:

1. Goal Setting: The leader has to set the goals and objectives for his section
or group. Goal setting is one of the important functions of a leader. The goals
may be set all by himself, or he may take the help of his subordinates in setting
goals.
2. Developing Morale: One of the important functions of a leader is to develop
morale in his subordinates. He always strives to keep his subordinates in good
mood or high spirits. He always tries to develop positive attitude in his
subordinates.
3. Securing willing participation: The leader influences the good leader
never uses force to make the subordinates work. Subordinates to work
willingly towards group objectives. A.
As a good example on his part, he takes active part in the activities of the group.
4. Motivates Subordinates: A leader motivates subordinates for better
performance. He may provide necessary incentives monetary incentives and/or
non-monetary incentives.

5. Organises Resources: A leader has to make arrangement of resources.

Such arrangement of resources is required to undertake activities.

6. Encourages initiative: The leader encourages initiative among his

subordinates. He provides them with freedom to come up with new and
innovative suggestions and ideas. He creates a healthy environment in
which the subordinates take active interest in the accomplishment of
objectives.

7. Developing team spirit: The leader coordinates the activities of his

subordinates. If there is any difference of opinion among his subordinates, he
strives to solve the differences. He makes every effort to develop team spirit
in his subordinates. A good leader does not believe in divide and rule
policy.

8. Representation: The leader is the representative of his subordinates. He

represents his subordinates whenever there is a need to express their views
with higher authorities within or outside the organisation.
9. Creating confidence: A good leader creates confidence in his
subordinates. He motivates them to accept and face challenges. Facing
challenges effectively enables an organisation to gain competitive advantage
in the market.
10. Providing Direction: An effective leader provides directions to his
followers. He provides necessary instructions and orders to perform properly
towards the achievement of goals.
 LEADERSHIP STYLES
Effective leadership is required to lead and guide the subordinates to perform
organisational tasks effectively.
In the words of George Terry "Leadership is the activity of influencing people
to strive willingly for group objectives."
Alford and Beatty define, "Leadership is the ability to secure desired actions
from a group of followers voluntarily, without the use of coercion."
Managers need to be good leaders. A leader according to Webster's Dictionary
"is a person who takes charge of or guides a performance or activity."
Every manager develops a style in managing the activities. Such styles vary from
leader to leader, from situation to situation and from organisation to
organisation.
In the words of Edwin Flippo, "Leadership style is a pattern of behaviour
designed to integrate organisational and personal interest in pursuit of some
objective."

The main types of leadership styles are as follows:

1. Autocratic Style: An autocrat is the one who takes all decisions by himself
and expects to be obeyed by his subordinates. The subordinates have no scope
to question the superior. Certain points to be noted in this respect:

• The superior makes the decision.

• The superior does not consult the subordinates in decision making.
• The superior is responsible for the decision.
• The relations between superior and subordinates are formal.

2. Bureaucratic Style: This type of leadership style is more followed in

government departments. The bureaucrats often follow rules and regulations in
totality. They do not use their discretion, even to do away with mere formalities.
They strictly follow the scalar chain principle, even in the case of urgency. The
following points to

• The bureaucrat takes the decision by strictly following formalities, or

rules and regulations.
• The subordinates are often not consulted.
 • The bureaucrat may avoid responsibility.
• The relations between superior and subordinates are formal.
• This style results in delay and red tape and unwanted paper work.

3. Consultative Style: In this type, the leader consults his subordinates before
taking a decision. The leader feels that it is always advisable to consult the
subordinates. This type of leader is more open minded and would welcome
suggestions from the subordinates before making a decision. The following
points to be noted:
• The superior consults the subordinates before making a decision.
• The subordinates may give their suggestions or comments, which the
superior may or may not accept.
• The superior makes the decision.
• The superior is responsible for the decision.
• The relations between superior and subordinates are informal.
4. Participative Style: The leader not only consults the subordinates, but allows
them to take part in decision making. The following points noted:
• The superior consults his subordinates before making a decision.
• The leader along with the group take part in decision making.
• Both the leader and the group share the responsibility for making the
decision.
• The relations are informal.

5. Laissez-faire Style: The term laissez faire comes from the French language
which means "Let them do - the way they want to do".

Is In this style, the leader shares the problem with the group. He acts more as a
chairperson in generating and evaluating alternatives in search of group
consensus. The following points are to be noted:

• The superior allows the subordinates to take decision.

• The superior acts more as a guide in arriving at decision.
• The superior and the subordinates share the responsibility.
• The relations are very informal.
6. Paternalistic Style: This style aims at creating a family atmosphere within
the organisation. The leader is respected and treated as a father figure by the
subordinates. This style is mostly followed in Japanese organisations. The
 following points to be noted:

• The leader considers himself as a parent figure.

• The leader may consult his subordinates.
• Mostly the leader takes the decision.
• The leader is responsible for decision making.
• The relations are very homely.

This type of style is more suitable in small organisations, where there are a
handful of employees and just one leader or boss. The leader advises, guides,
consoles and helps the subordinates even during their personal hardships.

7. Sociocratic Style: Sociocrats attempt to run their organisation like a social club.
The leader is more employee oriented rather than work oriented. For them, the
interest of the subordinates comes first and then that of the organisation. The
following points to be noted:

• The superior takes a decision by keeping the interest of the subordinates.

The interest of organisation may be secondary.
• The superior consults the subordinates for decision making.

8. Neurocratic Style: A neurocrat is highly task oriented and wants to get the
things done at any cost. He is highly sensitive and gets quickly upset at failures.
The following points to be noted:
• The leader may be emotional and eccentric.
• The leader may not consult the subordinates in decision making.
• The leader takes the decision.
• The leader is responsible for decision making, but he may of shift the
responsibility on to his subordinates.
9. Situational Style:
Now-a-days, in professionally managed organisations, the managers adopt
situational leadership style. This means, the leadership style varies depending
upon the situation. The situational leadership is a combination of three main
leadership - styles - autocratic, consultative and participative - depending on
situation:
• The leader may follow autocratic style in urgent and important decision,
when there is no time to consult the subordinates.
• The leader may follow consultative style to overcome the resistance from
the subordinates, and also to obtain relevant suggestions or information.
• The leader may adopt participative style, especially when group decision
making is necessary.

QUALITIES OF GOOD LEADER

Managers need to be good leaders. A leader according to Webster's
Dictionary "is a person who takes charge of or guides a performance or
activity." To be a good leader, one must possess good qualities. The
qualities of a leader are stated as follows:
1. Good Personality: Personality is the sum total of physical, mental and
social qualities. Successful leaders do have good personality. In fact, the
only quality required for leaders is good personality. All other qualities
listed below are various aspects of personality.
2. Intelligence: A leader should have good educational or technical
knowledge. He needs to have superior knowledge than that of his
followers, if not his followers may not respect him. As such the work of
the group may be affected.
3. Initiative: Leaders need to have the quality of initiative. They should be
in a position to do the right thing at the right time without being told by
others. He should be in a position to take appropriate decisions without
causing delay.
4. Innovative: A leader needs to have an innovative mind. He should have
the imagination to develop new ideas or new ways in handling the
activities. Followers expect their leader to be innovative. This is because
they like to undertake new and challenging activities.
5. Self Confidence: A leader must have self-confidence. This will enable
him to solve problems and face challenging situations. If he lacks self-
confidence, then he may not be able to influence his followers.
6. Communication Skills: Good leaders are effective communicators. He
should not only issue orders and instructions, but should ensure that the
followers have understood his orders clearly. Again, he should clearly
understand any communication from his subordinates.
7. Coach and Guide: The leader should act as a coach and a guide to direct
the efforts of his subordinates. As a coach, he may actively direct his
followers as to what to do, how to do and when to do a particular activity.
 As a guide, he may provide advice as and when the followers require to
carry out their activities.
8. Proper Judgment: He must be in a position to judge certain situations
effectively. He should be in a position to judge the performance of his
subordinates. Whenever, there are disputes among his followers, he may
play the role of the judge and solve the problems.
9. Human Skills: A good leader is the one who commands popular
following. And to have good following, the leader should have good inter-
personal skills to understand others. The knowledge of human skills is
very important to the leader as he constantly interacts with his followers.
10. Administrative Skills:
The leader also needs to have good administrative skills. He should have
the ability to plan, to organize, to direct, and to control the activities of his
group.
11. Discipline: A good leader must be disciplined person. If he is disciplined,
then he would be in a better position to command discipline of his
followers. Discipline often makes a leader dedicated and committed to
group goals. Otherwise, he may work for his own self-interest.
12. Delegation and Empowerment: A leader needs to have the art of
delegating the work to the subordinates. Delegation makes the
subordinates committed and dedicated in completing quality work at the
right time.

Apart from delegation, a leader must empower the subordinates to take

decisions, especially the routine ones. When subordinates get the freedom
to take the decisions, they may take the most appropriate decisions
because they are closer to the actual job activities.
13. Decision Making: A leader must have the quality of good decision
making. He/ she needs to take the right decision at the right time in the
interest of the organisation and that of the stakeholders including the
subordinates. Wherever, required he should consult the stakeholders
before taking the decisions to know their point of view. Quick but quality
decision is the answer to the success of the organisation.
14. Patience: Most of all, a leader needs to have good patience. He should
have patience to take appropriate decisions and not hasty decisions. He
also needs patience to listen to the views, opinions, and complaints of his
followers.
 [Link] Qualities: A leader needs to have several other qualities which
include:
• Positive attitude
• Enthusiasm towards the work
• Honesty and Integrity
• Inspire Others
• Commitment and Dedication
• Optimism towards results, etc.

Indoor, Outdoor & Virtual Team Building Exercises.

Team-building exercises can be indoor, outdoor, or virtual, each offering
different benefits for leadership and teamwork. Indoor exercises are good for
structured learning and building specific skills like problem-solving. Outdoor
activities promote motivation and camaraderie through physical challenges and
shared adventure. Virtual activities are essential for remote teams, focusing on
communication, trust, and unity through online games and challenges. All types
of exercises aim to develop trust, communication, and problem-solving abilities,
fostering a cohesive and supportive team environment.
Indoor Team Building
• Focus: Structured learning, developing specific skills, and engaging in thought-
provoking activities.
• Benefits: Enhances communication, trust, problem-solving, and decision-
making abilities in a controlled environment.
• Examples:
• Two Truths and a Lie: Participants share three "facts" about themselves—two
true, one false—to deepen understanding and foster intrigue.

• The Human Knot: A physical puzzle where team members link hands in a
circle and must untangle themselves without letting go, promoting collaboration
and problem-solving.

• Board Games & Puzzles: Collaborative games that require teams to work
together to achieve a common goal, encouraging strategic thinking and
teamwork.
 Outdoor Team Building
• Focus: Physical challenges, shared adventures, and building motivation in an
informal, refreshing setting.
• Benefits: Breaks down divisions, builds camaraderie, increases trust, and fosters
a stronger sense of community.
• Examples:
• Scavenger Hunts: Teams navigate an outdoor area to find hidden items,
requiring cooperation and strategic planning.

• Field Days: A series of fun, physical activities that promote teamwork, friendly
competition, and a sense of shared accomplishment.

• Walking Tours: A blend of activity and exploration that allows team members
to bond in a relaxed, informal environment while discovering new
surroundings.

Virtual Team Building

• Focus: Bridging geographical distances to build trust, unity, and clarity of team
norms.
• Benefits: Essential for remote or distributed teams, fostering connection,
collaboration, and team spirit despite being apart.
• Examples:
• Virtual Karaoke or Online Office Olympics: Engaging and fun activities that
encourage participation, laughter, and a light-hearted competitive spirit among
remote team members.

• Virtual Scavenger Hunts: Teams use online tools and resources to complete a
digital hunt, promoting problem-solving and teamwork in a virtual space.

• Lunch Roulette: Randomly pairing team members for virtual lunches to

encourage informal interaction and build personal connections.
 CONTROLLING

CONCEPT OF CONTROLLING
Controlling is a process of monitoring actual performance, and taking corrective
measures, if required.
George Terry, defines "Controlling is determining what is being accomplished,
that is, evaluating the performance, and if necessary, applying corrective measures
so that the performance takes place according to the plans."
Harold Koontz, defines "Managerial control implies the measurement of
accomplishment against the standard and the correction of deviations to assure
attainment of objectives according to plans."
In the words of Robert Anthony, "Management control is the process by which
managers assure that resources are obtained and used effectively and efficiently in
the accomplishment of an organisation's objectives."

Characteristics of Managerial Control:

1. Control involves measurement: Controlling involves monitoring of actual

performance and then comparing it with 8 planned targets. Necessary corrective
measures are taken to by correct the deviations, if any.
2. Control is a continuous process: Controlling is not a one-time affair. There
is a continuous and constant need to monitor the performance in the light of
plans. As long as the organisation exists, some kind of control is required.
3. Control influences employees: A good control system acts as the influencing
force, whereby, employees tend to perform effectively and efficiently as per the
plans. This is because control facilitates performance appraisal.
4. Control process is universal: Every organisation needs to control its activities.
Again, managers at all levels need to control the performance of their
subordinates. Thus, control has universal application.
5. Facilitates direction: Control as a function of management facilitates
direction of action. Efforts are directed at purposeful activities. Unwanted
activities are avoided.
6. Effective use of resources: Control helps to make optimum use of resources.
Wasteful expenditure and wastages of materials and other resources is
 minimised because of effective control.

7. Helps managers to recognise change: Control function helps managers to

recognise the need for a change. At times, managers find it difficult to achieve
planned targets, inspite of corrective measures. This may be because the
managers are concentrating on those products or markets which are not in their
line of business.

8. Goal Oriented: Control is a goal oriented. Corrective measures are

undertaken to achieve targets or goals. In other words, emphasis is placed on
goals or results rather than mere activities.

STEPS IN THE CONTROL PROCESS

Managers control activities by monitoring the performance and checking it against
planned targets, thereby, taking corrective measures, if required. The steps in the
control process are as follows:
1. Setting Targets: While planning, managers fix targets that are to be achieved by
individuals/departments. Specific targets are generally set for a definite period. For
instance, the marketing department may set the target to sell 10,000 units of a product
during the month of March, 2021.

2. Implementation of Targets: The manager must make arrangement to

implement the targets. Implementation involves:

• Organising resources.
• Directing the subordinates.
• Motivating the subordinates to perform effectively.

3. Measurement of Performance: Performance of individuals/departments is

measured periodically. Necessary reports are prepared to indicate the
performance of individuals. The reports may be prepared section wise, activity
wise, and period wise.
4. Comparing Performance with Plans: The actual performance is then
compared against the planned targets. By comparing, the manager can find out
the shortfalls or deviations. For instance, the actual performance may be sale of
9,000 units. Thus, the shortfall is 1000 units (10,000 - 9,000).
5. Finding the Causes of Deviations: The manager may study the causes of
deviations, especially, when there are negative deviations. For instance, there
can be shortfall in sales. This may be due to any or many of the following
reasons:
(a) Poor advertising campaign.
(b) Poor dealer relationships.
(c) Problems with the quality of product, etc.
6. Listing out Corrective Measures: The next step would be to list out the
various corrective measures to correct the deviations. For instance, to correct
shortfall in sales, the corrective measures can be such as:
(a) Corrective Measure I → to increase advertising.
(b) Corrective Measure II → to increase dealers incentives.
(c) Corrective Measure III → to improve quality, etc.
7. Selecting and Implementing Corrective Measures: Once, a list of
corrective measures is prepared, the manager makes a cost-benefit analysis of
the corrective measures. He then selects the best feasible corrective steps. The
measures are then implemented.
8. Review or Follow-up: The manager needs to review the corrective measures
to find out whether the corrective measures taken are in a position to correct the
deviations. If necessary, additional corrective measures may be taken, or the
targets may be revised.

ESSENTIALS OF A GOOD CONTROL SYSTEM

To make control system more effective, a manager must follow the following
essentials or requirements:
1. Focus on Objectives: The control system should always focus on objectives. It
should aim at the accomplishment of organisational goals.

2. Suitability: The control system should be suitable to the needs of the

organisation.

3. Prompt: An effective control system should promptly help to recognize

deviations and to take quick and corrective steps.

4. Flexibility: The control system must be flexible. The system must be workable
even during the changing conditions when the plans are changed or modified.
5. Simplicity: The control system must be simple. Those who are going to use it
or who would be affected by it must understand it clearly and correctly.

6. Objectivity: It means that the system should be definite and verifiable.

Performance standards must be objective and specific. They may be qualitative
or quantitative.

7. Suggestive: The control system must be suggestive. It should indicate where

the problem is, who is at a fault and what should be done to correct the faults, if
any.

8. Motivating: A good control system should encourage rather than discourage

the employees. It should be designed to prevent mistakes rather than to punish
individuals.

9. Critical Point Control: It may be neither desirable nor economical to control

each and every activity. Therefore, an organisation should be selective in control
matters. A good control system should focus on critical factors or areas, where
control is vital to ensure success.

10. Control by Exception: The control system should enable managers to focus
their attention on exceptional or significant deviations. The senior managers
should control major or exceptional deviations. The junior managers should be
allowed to control routine matters.
11. Forward Looking: A good control system should help the managers to plan
their activities for the future.

12. Economical: The control system should be economical to administer. It

should bring more returns than the money spent on it.
 TECHNIQUES OF CONTROLLING

The following are some of the techniques of managerial control:

A. PERT AND CPM The techniques of PERT and CPM were developed in
USA during the late 1950s in order to plan and control activities.

PERT - Program Evaluation and Review Technique was developed by the

Special Projects Office of the U.S. Navy. It was first formally applied
to the planning and control of the Polaris Weapon System in 1958. This
technique helps to expedite highly complex projects.
CPM - Critical Path Method was developed by Du Pont Company for the
purpose of scheduling. The PERT and CPM techniques are based on the
same principles.
PERT and CPM break down projects into events and activities and then
carefully conduct follow up. The various events in a project are identified, with
a planned time estimate for each event. These events are placed in a network
showing the relationships of each event to the other events of the project.
Therefore, these involves a time-event network analysis system.

PERT and CPM techniques can be used for planning, scheduling and executing
large projects, which involves a number of interrelated activities. PERT and
CPM help to plan and control both time and cost of the projects. The following
are the steps involved in PERT and CPM:

• Listing of all the activities related to the project.

• Determining the time estimates for each and every activity of the
project.
• Determining the critical path, i.e., the activity that takes the longest
time.
• Monitoring the particular sequence of activities on the critical path so
as to ensure that the total project gets completed as per the schedule.
• Follow-up after the completion of the project to know its success rate, and
also to know whether or not certain activities of the projects could have
been speeded up, which could have led to the completion of the project
much earlier than otherwise.
 MAJOR ADVANTAGES:

• Facilitates Planning: PERT and CPM help managers to plan, as it is

difficult to make a time-event analysis without planning. The subordinate
manager must also plan for the event for which he is responsible.
• Completion of Projects: These techniques focus on the critical path or
the sequence of events, which requires the maximum possible time, so that
the critical path can be properly monitored so that the project gets
completed as per the schedule.
• Facilitates Organising: The network techniques enable the bony project
managers to make proper arrangement of resources for each and every
activity of the project depending upon the time 69 required for such
activities. Facilitates Directing: These techniques facilitate proper
directions to the employees. The managers can provide the right directions
at the right time to complete the project on time.

B. Budgetary Control: Budgets are statements of anticipated results. They

can be expressed either in monetary terms such as in the case of revenue and
expense budgets, or in non-monetary terms such as in the case of physical sales
volume or production volume.
Budgets can be used to control activities. The actual performance can be
compared against the budgeted performance. If required control measures can
be undertaken to correct deviations.
There are various types of budgets such as cash budget, capital expenditure
budget, advertising budget, etc.
ADVANTAGES:

1. Budgets help in arrangement of resources - physical, human and financial, so

as to complete the various activities in the organisation.

2. Budgets are means of coordination of activities in the organisation. The

interaction between managers and subordinates that takes place during the
budget process helps to define and integrate the activities of organisation
members.

3. Budgets can influence the behaviour and motivation of the employees to

perform the activities as per budgeted targets.
4. Budgetary control follows the principle of control by exception. The
subordinates report only exceptional deviations to their superiors, and as such
the superiors can concentrate on significant deviations.
5. Budgets facilitate delegation of authority to lower levels. Without loss of
control, as the targets to be achieved are clearly specified.

6. Budgets facilitates performance appraisal of the employees. The actual

performance can be compared against budgeted targets to appraise the
employees.

7. Budgets help not in organizing resources, but also in providing necessary

directions to the employees so that they work effectively to accomplish
organisational goals.

8. Budgets help to control costs and expenses. The employees would try to make
every possible effort to reduce costs and expenses.

PERT V/S CPM

PERT CPM
1. Meaning: It is a project It is a project management tool which
management tool which is used to is used to manage definite activities of
manage uncertain activities of a a project.
project.
2. Nature of Project: It is suitable for It is suitable for projects such as
R & D projects. construction, ship building, etc.
3. Repetitive v/s Non-Repetitive It is applicable to tasks which are
Tasks: It is used where the nature of repetitive in nature.
tasks is non-repetitive.
4. Predictable v/s Non-Predictable It is used in projects with predictable
Activities: It is used in projects that activities.
have unpredictable activities.
5. Time and Costs: PERT gives CPM gives importance to cost
importance to time. If time is optimisation.
minimised, consequently the cost will
be reduced.
6. Critical and Non-critical It identifies critical and non-critical
Activities: PERT does not activities. Non- critical activities may
differentiate between critical and non- be eliminated to minimise cost of
critical activities. project.
7. Time Estimates: PERT is based on CPM is based on single time estimate,
three time estimates - the optimistic which is required for projects such as
time, the pessimistic time and the most construction.
likely time to complete a project.
8. Suitability: PERT is suitable for CPM is suitable for projects which
projects which require longer period of may require shorter period of time for
time for completion, and also difficult completion and also easy to estimate
to estimate time such as for R & D time for completion of projects.
projects.

ESSAY TYPE QUESTIONS

1. Discuss the nature of motivation.
2. Explain the importance of motivating the employees.
3. What are the factors influencing motivation of employees.
4. Explain the non-monetary factors which influence motivation of employees.
5. Discuss the importance of communication.
6. Discuss in brief the barriers to effective communication.
7. What are the functions of leadership?
8. Explain the concept of leadership.
9. Briefly explain different leadership styles.
10. Discuss the traits of a good leader.
11. Discuss the concept of controlling. In
12. Describe the steps in the process of controlling.
13. What are the essentials of a good control system?
14. Discuss in brief budgetary control as a technique of controlling.
15. Explain in detail any two techniques of controlling.