ferent disciplines view and heir own angles. The economists ne urce like land, labour, capital and orgamentien nn Jook upon it as a system of authority to achieve busines logists consider managers asa pat of theclass elites ‘The definitions by some of the léadi the ele i practitioners are given below: ading management thinkers and (@ Management consists in guicin ; I Y guiding human and physical resourcés _ into dynamic, hard-hitting organisation unit that attanes ‘objectives to the satisfaction of those served and with a hice degree of morale and sense of attainment on the part of teen rendering the service. —Lawrence A. Appley (ii) Management is the coordination of all resources through the process of planning, organising, directing and controlling in order to attain stated objectives. —Henry L. Sisk, (ii) Management is principally the task of planning, coordinating, ‘motivating and controlling the efforts of others towardsa specific objective. (iv) Management is the art and science of org: human efforts applied to control rials of nature for the benefit of ma ie forces and utilise the mate- (v) Management environment groups, can perform effi attainment of group goals, (vi) Management is the then seeing that it To manage is to forecast coma to coordinate and to control. casei a ra ii tive leadership anywher (viii) Management is the function of exec pany with seeing that the job sens ir srations that al ix) ii aiding the ope g and guidii : tasks all centre on plannin;eens aun sae ay is guiding human and physical resources into ti eee units which attain their objectives to the ai of those served and with a high degree of morale Sense of attainment on the part of those rendering service. sii) Mi : —Armerican Management Association (xii) ang Bement is a’ multipurpose organ that manage a business ‘anages Managers and manages Workers and work. —Peter Drucker 1.2 CONCEPTS OF MANAGEMENT The term mana, wi 1m igement has been inte in several 7 ine terpreted in several ways; some of Management as an Act y Management is an activity just like playing, studying, teaching etc. As an activity management has been debhes ap neato eee things done through the efforts of other people, Management is a group activity wherein managers do to achieve the objectives of the group. ‘The activities of management are: * Interpersonal activities + Decisional activities * Informative activities. Management as a Process Management is considered a process because it involves a series of interrelated functions. It consists of getting the objectives of an organ- isation and taking steps to achieve objectives. The management process includes planning, organising, staffing, directing and controlling functions. Management as a process has the following implications: (i) Social Process: Management involves interactions among people. Goals car be achieved only when relations between people are productive. Human factor is the most important part of the management. (ii) Integrated Process: Management brings human, physical and financial resources together to put into effort. Management also integrates human efforts soas to maintain harmgny among them. (iii) Continuous Process: Management involves continuous i ing and solving problems. Itis repeated every now and the goal is achieved. épe LOS Fig. 1.1 Management as resource Management as a Team ‘Asa group of persons, management consists of all those who have the responsibility of guiding and coordinating the efforts of other persons. These persons are called as managers who operate at different levels, of authority (top, middle, operating): Some of these managers have ‘ownership stake in their firms while others have become managers by Virtue of their training and experience. Civil servants and defence per~ sonnel who manage public sector undertakings are also part of the management team. As a group managers have become an elite class in society occupying positions with enormous power and prestige Management as an Academic Discipline ent has omerged as a specialised branch of knowledge. It principles and practices for effective management of ‘Management has become as very popular field of studyPAT. Pee ee ion into institutes of ing and challenging as is evident from the great rush for admissi igement. Management offers a very rewardi career, Management as a Group Management means the group of persons occupying managerial positions. It refers to all those individuals who perform managerial functions. All the managers, eg,, chief executive (managing director), departmental heads, supervisors and so on are collectively known as management For example, when one remarks that the management of Reliance Industries Ltd. is good, he is referring to the persons who are manag” ing ee company. There are several types of managers which are listed as under. () Family managers who have become managers by virtue of their being owners or relatives of the owners of a company. Gi) Professional managers who have been appointed on account of __... their degree or diploma in management. (ii) Civil Servants who manage public sector undertakings.” Managers have become a very powerful and respectéd group in modern society. This is because the senior managers of companies take decisions that affect the lives of a large number of people. For example, if the managers of Reliance Industries Limited decide to expand pro- duction it will create job for thousands of people. Managers also help to improve the social life of the public and the economic progress of the country. Senior managers also enjoy a high standard of living in society. They have, therefore, become an elite group in the society. Nature and Characteristics of Management The salient features which highlight the nature of management are as follows: _ (i) Management is goal-oriented: Management is not an end in itself It is a means to achieve certain goals. Management has no justification to exist without goals. Management goals are called group goals or organisational goals. The basic goal of manage- ment is to ensure efficiency and economy in the utilisation of human, physical and financial resources. The success of management is measured by the extent to which the established goals one achieved. Thus, management is purposefull. (ii) Management is universal: Management is an essential element of every organised activity irrespective of the size or type oftis necessary. 7 university, government, army, cricket require management. Thus, management is a : ive activity. The fundamental principles of management are applicable in all areas of organised effort. Managers at all levels perform the same basic functions, (ii) Management is an Integrative Force: The essence of management lies in the coordination of individual efforts in to a team, Man- agement reconciles the individual goals with organisational goals. As unifying force, management creates a whole that is more than the sum of individual parts. It integrates human and other resources. (iv) Management is a Social Process: Management is done by people, “through people and for people. It is a social process because itis concerned with interpersonal relations. Human factor is the most important element in management. According to Appley, “Man- agementis the development of people not the direction of things. ‘A good manager is a leader not a boss. It is the pervasiveness of human element which gives management its special character as a social process”. (¥) Management is multidisciplinary: Management has to deal with ~ human behaviour under dynamic conditions. Therefore, it depends upon wide knowledge derived from several disciplines like engineering, sociology, psychology, economics, anthropol- ogy, etc. The vast body of knowledge in management draws heavily upon other fields of study. z (vi) Management is a continuous Process: Management is a dynamic and an on-going process. The cycle of management continues to ‘operate so long as there is organised action for the achievement of group goals. _ (vii) Management is Intangible: Management is an unseen or invisible force. It cannot be seen but its presence can be felt everywhere in the form of results. However, the managers who perform the functions of management are very much tangible and visible. (viii) Management is an Art as well as Science: It contains a systematic body of theoretical knowledge and it also involves the practical application of such knowledge. Management is also a discipline involving specialised training and an ethical code arising out of its Social obligations. ‘On the basis of these characteristics, management may be defined as a continuous social process involving, the coordination of human and material resources in order to accomplish desired objectives. It sey the determination and the accomplishment of organisa- goals,Objectives Of Management ‘The objectives of management are narrated as under. (Organisational objectives: Management is expected to work for the achievement of the objectives of the particular organisation in which it exists. Organisational objectives include: (@) Reasonable profits so as to give a fair return on the capital invested in business (b) Survival and solvency of the business, ie., continuity. (©) Growth and expansion of the enterprise .» (4) Improving the goodwill or reputation of the enterprise. (i) Personal objectives: An organisation consists of several persons who have their own objectives. These objectives are as follows: (a) Fair remuneration for work performed (b) Reasonable working conditions () Opportunities for training and development (4) Participation in management and prosperity of the enter- prise (e) Reasonable security of service (iii) Social objectives: Management is not only a representative of the owners and workers, but is also responsible to the various groups outside the organisation. Its expected to fulfil the objec- es of the society which are given below: (a) Quality of goods and services at fair price to consumers (b) Honest and prompt payment of taxes to the Government. (©) Conservation of environment and natural resources. (d) Fair dealings with suppliers, dealers and competitors (e) Preservation of ethical values of the society. 1.3 ROLE AND IMPORTANCE OF MANAGEMENT Management is indispensable for the successful functioning of every organisation, [tis all the more important in business enterprises. No business runs in itself, even on momentum. Every business needs repeated stimulus which can only be provided by management. According to Peter Drucker,” management is a dynamic lifegiving element in an organisation, without it the resources of production remain mere resources and never become production’. ‘The importance of management has been highlighted clearly in the following points: (i) Achievement of group goals: A human group consists of several ‘persons, each specialising in’doing a part of the total task. Each person may be working efficiently, but the group as a w! Gannot realise its objectives unless there is mutualTe ees and ec among the members of the group. Mai : "ment creates team-work and coordination in the group. He ‘reconciles the objectives of the group with those of its members "so that each one of them is motivated to make his best contribu. Be ees the oe eine of group goals. Managers piring leadership to keep the Rane S o :p the members of the group (i) Optimum utilisation of resources: Managers forecast the need for materials, machinery, money and manpower. They ensure that the organisation has adequate resources and at the sametime does not have idle resources. They create and maintain an environment conducive to highest productivity. Managers make Sure that workers know their jobs well and use the most effi cient methods of work. They provide training and guidance to employeers so that they can make the best use of the available resources, Gi) Minimisation of cost: In the modern era of cut-throat competition no business can succeed unless it is able to supply the required goods and services at the lowest possible cost per unit. Manage- ment directs day-to-day operations in such a manner that all wastage and extravagance are avoided. By reducing costs and improving efficiency, managers enable an enterprise to be com- petent to face competitors and earn profits. (iv) Survival and growth: Modern business operates in a rapidly changing environment. An enterprise has to adapt itself to the changing demands of the market and society. Management keeps in touch with the existing business environment and draws its predictions about the trends in future. It takes steps in advance to meet the challenges of changing environment. Changes in busi- ness environment create risks as well as opportunities. Manag- ers enable the enterprise to minimise the risks and maximise the benefits"of opportunities. In this way, managers facilitate the continuity and prosperity of business. (v) Generation of employment: By setting up and expanding busi- ness enterprises, managers create jobs for the people. People earn their livelihood by working in these organisations. Manag ets also create such an environment that people working in enterprise can get job satisfaction and happiness. In this way ‘managers help to satisfy the economic and social needs of the ‘employees. (1) Development of the nation: Efficient management is equally important at the national level. Management is the most crucial factor in economic and social development. The development ‘ofa country largely depends on the quality of the managementtion is different from management: Accord om administration is a hence! activity while a ment is a lower level function. Administration is a dae tive function concerned with the determination of objectives policies while management is an executive function involoies the implementation of policies and direction of efforts for the achievement of objectives. This view is held largely by Amer can experts on management. American experts such as Florence, Lansburg, Haimann, Milward, McFarland, Spriegel, Schulze and Tead also hold thig view that administration involves decision-making and policy. formulation while management is concerned with the execution of policies and supervision of work. According to them, administration is superior to management as the latter has only a peripheral role in determination of objec tives and policies. (ii) Administration is a part of management: According to the Euro- pean School of thought, management is a wider term including administration and organisation. This viewpoint has been propounded by Breach. According to him, “Management is the generic term for the total process of executive control involving responsibility for effective planning and guidance of operations of an enterprise. Administration is that part of management which is concerned with the installation and carrying out of the procedures by which the programme is laid down and commu nicated and the progress of activities is regulated and checked against plans’. Kimball and Kimball, Richman and Copen also hold similar views. According to them, administration is only an implementing agency while management is determinative. Thus, the European viewpoint is exactly opposite to the Amer can opinion. (iii) Administration and management are one: Many writers like Henri Fayol, William Newman, Chester Barnard, George Terry, Louis A. Allen, Koontz and O’ Donnell make no distinction between management and administration. According to Newman, Mase agement or administration is “the guidance, leadership and control of the efforts of a group of individuals towards some _ common goals”. According to Fayol, all undertakings require ‘same functions and all must observe the same principles.1.5 LEVELS OF MANAGEMENT Every business organisation, irrespective of its size, has many mana. gerial positions in its structure. These positions are created trough the process of delegation of authority from top to lower levels. Each position is marked by authority, responsibility, functions, roles Board of Directors Managing Director General Manager Departmental Manager and Top Level y Deputy Manager Middle Level y Asst, Manager ‘Supervisor Fitst Line [> Lower Level Workers (Core group)il en “telationships, The contents and nature vary, depending im “AC which the position lies, As one moves upward in the organisal ht managerial position plays an important role, larger the Con a greater the authority and higher the responsibility. These manage"™’ positions lying in the chain of command may be classified into vaniow" groups or levels of management. Broadly speaking, an organisation has two important levels of management, namely functional and operative. The functional level is concerned with the process of determining primary objectives, formulating basic policies, making vital decisions and controlling and coordinating activities of person~ nel. The operative level of management is related to implementation of plans and decisions, and pursuit of basic policies for achieving the ‘objectives of the organisation. Generally, the levels of management consisting of various mana gerial positions in the structure of an organisation, differ from one organisation to another, depending on the size of business activity, philosophy of management, span of control and other related factors. But, in a joint stock company, for conducting its business efficiently, managerial personnel may be placed in three levels, that is, top, middle and lower or supervisory level Top Level Management The top level management is generally occupied by the ownership group. Ina joint stock company, equity shareholders are the real own- ers of the company. Thus, they elect their representatives as directors, form a board, known as board of directors, which constitutes the top evel of management. Besides the board, other functionaries including, managing director, general manager or Chief executive to help direc- tors, are included in this level. Itis the highest level in the managerial hierarchy and the ultimate source of authority in the organisation. The top level managers are accountable to the owners and responsible for overall management of the organisation. The major functions of the top level management are as under: ( To make a corporate plan for the entire organisation covering, all areas of operations. {ii) To decide upon the matters which are vital for the survival, prof- itability and growth of the organisation such as introduction of new product, shifting tonew technology and opening new plant ete. (iii) To decide corporate goals. (iv) To decide structure of organisation, creating various positions there in.~__nesssuchas government, trade ur (8) To formulate basic policies and cisions disposal and distribution of profits il) To select key officials and executiv es for the company. s of the organisation, parties having a stake in busi. inion and trade associations etc, providing direction and leader. ship to the organisation as a whole. ti) To coordinate various sub-system: ix) To maintain liaison with outside Middle Level Management Tee fil up the gap which exists between functional and ope §Welevel, some managerial positions are created at the mid management. Middle lev agers, deputy managers, ra dle level of fel management consists of departmental man- foreman and administrative officers etc. These Srecutives are mainly concemed with the over al functioning of thei: Heective departments, They act as a link between top and lower level eters: The activities of middle level managers centres around etermining departmental goals and devising ways and meane fe accomplishing them, ‘The main functions performed by these managers are as under () To prepare departmental plan covering all activities of the Separtment within the basic framework of the corporate plar (Gt) Toestablish departmental goals and to decide upon various v ays and means for achieving these goals to contribute to organ isational goals, (ii) To perform all other managerial func departmental activities for secur entire department (iv) To issue detailed orders and instructions to low! er level manag- {rs and coordinate the activities of various work units at los level. tions with regard to ing smooth functioning, of th (¥) Middle level managers explain and interpret pol made at the top level to lower le icy decisions vel managers. Lower Level or Supervisory Level Management Lower-level management is know: because itis concerned mainly with personal oversight and srcere CF operative employees. It consists of factory supervisors, superin- fendents,foremen, sales supervisors, accounts officers ote 1 hey directly Buideand control the performance ofankand file workers, They issu @rders and instructions and guide day to-day activities. They alos M as supervisory management,re of represent the grievances of the workers to the higher levels management. i Supervisory management performs the following functions: (i) Planning of day to day work Gi) Assignment of jobs and issuing orders and instructions i) Supervising and guiding workers (iv) Maintaining close personal contacts with workers ' discipline and team-work (v) Evaluating operating performance (vi) Sending reports and statements to higher authorities (vii) Communicating the grievances and suggestions of workers t0 higher authorities, o ensure 1.6 NATURE OF MANAGEMENT To understand the basic nature of management, it must be analysed in terms of art and science, in relation to administration, and as a profes- sion, in terms of managerial skills and style of managers. nce ¥ Management is Combination of Art and S Management knowledge exhibits characteristics of both art and sci- ence, the two not mutually exclusive but supplementary. Every disci- pline of art is always backed by science which is basic knowledge of that art. Similarly, every discipline of science is complete only when it is used in practice for solving various kinds of problems faced by human beings in an organisation or in other fields of social life which is more related to an art. Art basically deals with an application of knowledge personal skill and know-how in a specific situation for effi- ciently achieving a given objective. Itis concerned with the best way of doing things and is consequently, personalised in nature. During the primitive stages of development of management knowl edge, it was considered as an art, There was a jungle of managerial knowledge. It was not codified and systemised. People used it to get things done by others, in their own way giving an impression that whosoever uses it, knows the art of using it. This kind of loose and inadequate understanding of management supported the view that it was an art. Management as a Science Science means a systematic body of knowledge pertaining to a specific field of study. It contains general principles and facts which explains a “phenomenon. These principles establish cause-and-effect relationship eetial Features of science are as follows: ts or general principles capable of universal application eloped through scientific enquiry or experimente tablish cause and effect re lationships between various factor Their Validity can be verified a and they serve as reliable guide Or predicting future events, PGs Row examine as fo what extent management satisfies the “above conditions: Systematic body of knowledge: Management has a systematic body Of Knowledge consisting of general principles ond techniques, These help to explain events and serve as guidelines for manag- ers in different types of organisations, KG) Universal principles: Scientific principles represent basic facts abouta particular field enquiry. These are objective and represent best thinking on the subject, These principles may be apelied in all situations and at all times. Exceptions, ifany, can be logically GxPlained. For example, the Law of Gravitation states that if you throw an object in the air it will fall on the ground due to the Bravitational force of the earth. This law can be applied in all countries and atall points of time. Itis as applicable to a football asit isto an apple falling from tree. Management contains sound fundamental principles which can be universally applied. For instance, the principle of unity of command states that at a time ‘one employee should be answerable to only one boss. This Principle can be applied in all types of organisation-business or non business, However, principles of management are not ‘exactly like those of physics or chemistry. They are flexible and need to be modified in different situations. Scientific enquiry and experiments: Scientific principles are derived through scientific investigation and reasoning. It means that there is an objective or unbiased assessment of the problem situation and the action chosen to solve it can be explained logically. Sci- entific principles do not reflect the opinion of an individual or ‘ofa religious guru. Rather these can be scientifically proved at By Hine thy azeenicall tested. For example, the principe that the earth revolves around the sun has been scientifically proved.OCIS IAN SCOPEIOL Management pri Eee 4 F Trees ment Principles are also based on scientific enquiry ane }nvestigation. These have been developed through exper For ox Practical experience of a large number of managers. has teonbe® thas been observed that wherever one employee pling are ting’ bosses simultaneously, confusion and indisci- Hons. Sk*ly to arise, with regard to following the instruc- (iv) Cause and effect retari ionship: Principles of science lay down ec, effect relationship Detween related factors. For ture inte, A Watet is heated up to 100°C, it starts boiling and establish er POU" Similarly, the principles of management ables, Fon St and effect relationship between different vari- responsibil nonce lack of balance between authority and (0) Teche of arity will cause management to become ineffectiv ests of validity and predictability: Validity of scientific principles can be tested at any time and any number of times. Every time the test will give the same result. Moreover, the future events can be predicted with reasonable accuracy by using scientific Principles, For example, the Law of Gravitation can be tested by throwing various things in the air and every time the object will fall on the ground. Principles of management can also be tested for their validity. For example, the principle of unity of com- mand can be tested by comparing two persons, one having a single boss and other having two bosses. The performance of the first person will be higher than that of the second. Thus, management is undoubtedly a science. It contains a systematic body of knowledge in the form of general principles which enjoy universal applicability. However, management is not as exact a science—Physics, Chemistry, Biology and other Physical sciences. This is because management deals with people and it is very difficult to predict accurately the behaviour of living human beings. Management principles are universal but they cannot be expected to give exactly the same results in every situation. That is why management is known as a soft science. Management is a social science. It is still growing, with the growing needs of human organisations. ~~ Management as an Art Art implies the application of knowledge and skills to bring about the desired results. The essential elements of arts are: - (i) Practical knowledge ii) Personal skill iii) Result oriented approachNenmnthe ti @ person mi "quate technical knowledg. ‘buthe cannot becomea good painter unless! eo" to make use ofthe brush and colours. Similarly, . @ Person nnot become a successful manager simply by reading the ryand getting a degree or diploma in management, He ‘must also learn to apply his knowledge in solving mai Problems in practical life. A manager is judged not j technical knowledge but by his efficiency in app nagerial just by his lying thi knowledge. a (ti) Personal skill: Every artist has his own style and approach to his job, The success of different artists differ even when all of them ossess the same technical knowledge or qualifications. This is due to the level of their personal skis. For example, there are Fees ualified singers but Lata Mangeshkar has achieved the highest degree of success. Similarly, management s personalised Every manager has his individual approach and style in solvi managerial problems. The success of a manager depends on hic Personality in addition to his technical knowledge. Gil) Result-oriented appronch: Arts seeks to achieve concrete ‘The process of management is also directed towards the accom, plishment of desirable goals. Every manager applies certain Knowledge and skills toachieve the desired results. He uses men, money, materials and machinery to promote the growth of the organisation. GY) Creativity: Artis basically creative and an artist aims at produc: ing something that had not existed before. Therefore, every piece Of art requires imagination and intelligence to create. Like any other art, management is creative. A manager effectively co ines and coordinates the factors of production to create goods and services, Moulding the attitudes and behaviour of people at work, towards the achievement of the desired goals is an art of ___ the highest order. () Improvement through people: Practice makes one perfect Every artist become more and more efficient through constant iactice, A dancer, for example, learns to perform better by con- tinuously practicing a dance. Similarly, manager gains experi- ence through regular practice and becomes more effective. results,, “management is both a science as well as an art”. It is ¢ e because it has an organised body of knowledge consisting © tain universal facts. I is known as an art because it involves creat- {ing results through practical application of knowledge and skills. How- ‘ever, art and science are complementary to each other. They are not mutually exclusive. Science teaches one to know and art to do. Art without science has no guide and science without art is knowledge wasted. yi _ For example, a person cannot be a good surgeon unless he has scientific knowledge of human anatomy and the practical skill of applying that knowledge in conducting an operation. Similarly, a successful manager must know the principles of management and also acquire the skill of applying those principles for sélving managerial problems in different situations. Knowledge of Principles and theory is essential, but practical application is required to make this knowledge fruitful. One cannot become an effective manager simply by learning management principles by heart. Science (theory) and art (practice) are both essential for the success of management. Management as a Profession A profession is calling that requires specialised knowledge and often, long intensive academic preparation. The essential features of profes- sion are as follows: (i) Well defined body of knowledge (ii) Restricted entry (iii) Service motive (iv) Code of Conduct (v) Representative professional association Let us examine to what extent management fulfils the above requirements: (i) Specialised body of knowledge: Every profession has a well defined body of knowledge relevant to the area of specialisation. In order to practice a profession, a person requires specialised knowledge of its principles and techniques. Moreover, he must make deliberate efforts to gain proficiency unit. There exists a substantial and rapidly expanding body of knowledge in management. A manager must have intensive devotion and involvement to acquire expertise in the science of management. In addition, there should be competent application or judicious tion of this knowledge in solving complex problems. To- management is a separate discipline having a specialised | organised body of knowledge.There exists institutions and universities to ucation and training for a profession. No one can enter profession without going through the prescribed course of learning, For example one must pass the Chartered Accountancy _ examination to practice accountancy profession. Many institutes ‘ofmanagement have been set up in India and abroad which offe, courses for specialised training in management. Severa] management consultancy firms have also come into existence to offer advise for solving managerial problems. Formal education and training has become very helpful in getting jobs as managers But no minimum qualification or course of study has been prescribed for managers by law. (ili) Service motive: A profession is a source of livelihood sionals are primarily motivated by the desire to serve the com. munity. For example, a doctor earns his living from his medical Practice. But he does not treat his patients only for the sake of money. He has a concem for the suffering of othe: tohelp the community. Ther but profes. rs and a desire xefore, a profession enjoys high com- e with managers, A to its owners, but he at a reasonable cost and to contribute to the well-being of the community. Gy) Representative nssociation: In every profession there is a statutory association or institution which regulates that profession. For example, the Institute of the Chartered Accountants of India establishes and administers standards of competence for the auditors. Inmanagement also associations have been established both in India and abroad. Managers have formed associations for the regular exchange of knowledge and experience. In Inclia, there is the All India Management Associati association does not have the statutory po} activities of managers. No university standard exists for their evaluation. @ssociation is not compulsory in order to become a manager. (7) Code of conduct: Members of one profession have to abide bya code of conduct which contains rules and regulations providing the norms of honesty, integrity and professional ethics, Fee example a chartered accountants not expected to commercially advertise his firm. The code of conduct is bi y the representative association to ensure self-discipline among its members, Any member violating the code can be punished and his memberahiy, can be cancelled. The All India Management Association has framed code of conduct for managers. The code requires the ‘managers to fulfil their social and moral obligations. Member munity sanction or respect. Similar is the cas: manager ofa factory is responsible not only is also expected to produce quality goods ion. However, this wer to regulate the accepted criteria or Membership of thisSRGRERGEL Ge tomer Oe 7 1.8 SKILLS OF MANAGEMENT In modern business the job management has become very difficult. Several skills are required to manage successfully a large organisation ina dynamic environment. These skills of managers have been classified into four categories, namely technical, human, diagnostic and conceptual skills. (i) Technical Skills Technical skills refer to the ability and knowledge in using the equip- ment, technique and procedures involved in performing specific tasks. These skills require specialised knowledge and proficiency in the mechanics of particular job. Ability in programming and operating com- puters is, for instance, a technical skill. There are two things a manager should understand about technical skills. In the first place, he must know which skills should be employed in his particular enterprise and be familiar enough with their potentiality to ask discerning questions of his technical advisors. Secondly a manager must understand both the role of each skill employed and interrelations between the skills.(ii) Human Skills Human; Skills consists of the ability to work effectively with other people both as individual and as members of a group. These are required to Win cooperation of others and to build effective work teams. Such skills. Aa 2 Sense of feeling for others and capacity to look at things from others point of view. Human skills are reflected in the way a manager Peicelves his superiors, subordinates and peers. An awareness of the importance of human skills should be part of a managers orientation and such skills should be developed throughout the career. While tech- nical skills involve mast tery of ‘things’ human skills are concerned with understanding of ‘People’ (iii) Conceptual Skills Conceptual skills comprise the ability to see the whole organisation and the interrelationships between its parts. These skills refer to the ability to visualise the entire picture ot to consider a situation in its totality. Such skills help the manager to conceptualise the environment, to analyse the forces working in a situation and take a broad and far- sighted view of the organisation. Conceptual skills also include the competence to understand a problem in all its aspects and to use origi- nal thinking in solving the problem. Such competence is necessary for rational decision-making. ‘Thus technical skills deal with jobs, human skills with persons and conceptual skills with ideas. These types of skills are interrelated. But the proportion or relative significance of these skills varies with the level of management as shown in the figurel.4, ‘Top Management Middle Management Operating Management Fig. 1.4 Managerial Skills of Various Skills Technical skills are most important at the supervisory or operating level where a close understanding of job techniques is necessary 0 guide workers, As one moves up the management hierarchy, technical skills become less important. Higher level managers deal with subo:- dinate managers and specialised technical knowledge is comparatively Jess important fr them. Conceptual skill are very ‘important for top "management in formulating long-range plans, making broac | Gecisions, and relating the business enterprise to its industry. ancThus, the relative importance of conceptual skis increases : move to ee Bi ainiiement This would be self evi. dent as management is the process of getting things done through, People. Human skills are equally important at all levels of manage. ‘™ent because every manager has to deal with people. (iv) Diagnostic Skills Diagnostic skills include the ability to determine by analysis and ‘examination the nature and circumstances of particular conditions. It isnot only the ability to specify why something happened but also the ability to develop certain possible outcomes. It is the ability to cut through unimportant aspects and quickly get to the heart of the prob- Jem. Diagnostic skills are probably the most difficult ones to develop because they require the proper blend of analytic ability with common sense and intelligence to be effective. 1.9 SCOPE OF MANAGEMENT The field of management is very wide. The operational areas of busi- ness management may be classified into the following categories: (i) Production Management: Production management implies planning, organising, directing and controlling the production function so as to produce the right goods, in right quantity, at the right time and at the right cost. It includes the following activities: (a) designing the product (b) location and layout of plant and building (c) planning and control of factory operations (a) operation of purchase and storage of materials (€) repairs and maintenance (6) inventory cost and quality control (g) research and development etc. (i) Marketing Management: Marketing management refers to the identification of consumers needs and supplying them the goods and services which can satisfy these wants. It involves the following activities: (a) marketing research to determine the needs and expectation “of consumers (b) planning and developing suitable products (©) setting appropriate prices (d) selecting the right channel of distribution, and (@) promotional activities like advertising and salesmanship to ‘communicate with the customersadie Wis igre tne Financial ‘management seeks to ensure the e @ of funds to business at the right time and cet Le cost. It comprises the following activities __@) estimating the volume of funds required for both long-term io) me Short-term needs of business ee ting the appropriate source of funds {G) ising the required funds atthe right time ensuring proper utilisation and allocation of raised funds so as fo maintain safety and liquidity of funds and the credit- orthiness and profitability of business, and (e) administration of earnings ‘Thus, financial management involves the planning, organising and controlling of the financial resources. Business Management uononposd Personne! Fig. 1.5 Compounds of Business Management (iv) Personnel Management: Personnel management involves plan- ning; organising and controlling the procurement, development, compensation, maintenance and integration ofhuman resources of an organisation. It consists of the following activities: (a) manpower planning (b) recruitments, (©) selection, (d) training (e) appraisal, (6 promotions and transfers, (g) compensation, {h) employee welfare services, and (personnel records and research, ete.Decision are as of Financial Management stip: Fiancing decision debt JP). eauity ratio capita structure Investment decisions Capital budgeting Management of working capitalof rational ; management process as a sequence O Fayol claimed that planning, organising, command, and control were basic and common ete ss in the process of management. But later, due to certain taking place in the nature and field of management, the Sequence of functions was rearranged by adding some more functions ee made as planning, organising, staffing, directing, ‘Management Process, Fig. 2.1 Elements of the Management Process 2.2: NATURE OF THE PROCESS OF MANAGEMENT ‘The process of management is characterised by the following features: (i Continuity: Management is a continuous process. The process is analysed into several elements like planning, organising, staffing, directing and controlling. But this does not mean that the process always begins with planning and comes to an end with controlling. The elements or functions are interrelated and interdependent. The functions may be fused and the sequence may begin with any function and the entire process cycle may be completed. It is, therefore, undesirable to insist that a manager must perform the functions always ina definite chronological sequence. The management cycle is never- ending and is repeated over and over without an end. (ii) Circular; The managerial functions are interactive in nature. This means they are contained within each other. For example, planning, organising, directing and controlling all may occur within the planning, process. In a way, all functions may be considered as sub-functions of each other. The proceeding element of the management processInfluences all the succeeding elements and in turn is influenced iy Proceeds. Therefore, managementis a circular and not a linear Prowse (Gti) Social: Management is human and social process and nop 4 ‘mechanical one. It influences significantly the people inside and outsige an Organisation and the society as a whole. Management has far. Feaching social consequences. Therefore, a manager while takin, Gecisions must remember the likely impact of his decisions on socio, Moreover, the management process is carried out by people, through People and for people and also by the people in one sense. (iv) Composite: All the ‘managerial functions must be considered in their totality because management process is an organic and integrated ag whole. Each function makes a distinct contribution to this process but cannot be considered in isolation. All the functions contribute to the whole and derive strength from each other, The final outcome is greater than the aggregate of their individual contributions. A manager per. forms the various functions simultaneously in a continum. 2.3 CLASSIFICATION OF MANAGERIAL FUNCTIONS The elements of management process are known as functions of Tuanagement. There is, however, no single list of functions acceptable to all. Various authors have classified the ese functions differently. Henri Fayol has classified them into planning, organising, commanding, coordinating and controlling, RC. Davis identifies planning, organising and coordination as parts of control. Luther Gullick has given the Keyword ‘PODSCORB’ which stands for Planing (P), Organising (O), Staffing (S), Directing (D), Controlling (CO), Reporting (RY sre Budgeting (B). Koontz and O'Donnell have suggested Planning, organising, staffing, directing and controlling. Emest Dale has addition mentioned innovation and representation, Almost all authorities agree on the base functions of planning organising and controlling. Modern writers treat staffing as 4 marae function where as the classical writers considered stating ac a pont organising, In view of the growing significance of human searsct management staffing should be considered a separate function Inenice to get things done, a manager has to guide, motivate, lead arcq communicate with his subordinates. ae directing ec commanding sctonting Than he ancora of manages be classified into five categories whichis venfied with thehalpoy. oy functions which are as under. Nea‘Management Process—runcion ro (Sub-functions and elements) Pee nee nonon making, strategy formulation, policy making, ene etes ling, budgeting, problem solving innovation, Orgentsig (Sub-functions and elements) enna LE divisionalisation, departmentalisation, delegation, ‘alisation, activity analysis, task allocation Staffing: (Sub-functions and elements) Manpower planning, recruitment, selection, training, placement, com- pensation, promotion, appraisal etc. Directing: (Sub-functions and elements) Supervision, motivation, communication, leadership, activating ete. Controlling: (Sub-functions and elements) Fixation of standard, recording, measurement, reporting corrective action. 2.4 MANAGERIAL AND OPERATIVE FUNCTIONS ‘Managerial functions should be differentiated from operative functions ‘of business. Operative functions include production, marketing, financ- ing, personnel etc. Operative functions are also known as the functional sees of business. Operative functions differ according to the nature and size of business. For instance, there is no production function ina retail store. On the other hand, managerial functions are ess ential in all Financing2.5 STEPS INMANAGEMENT PROCESS (FUNCTIONS OR PROCESS) A brief description of different functions of management is given below: (i) Planning: Planning is the basic or primary function of management. It precedes other functions because a manager plans before he acts. Plan- ning is a process of determining objectives, developing alternative courses of actions and selecting the best course of action for achieving objectives. It is a forwarc-looking approach which in involves futuris- tic estimates or projections. To visualise the future, the past is analysed, selated to present and, on its basis, the future is forecasted. Thus, theplanning function structures the future destination of an organisation which provides direction to its activities. In planning, the managers decide in advance what is to be done, when, how and by whom it will be done. Successful managers visualise what problems may arise at the time of implementing plans. The process of Planning Consists of (@) Determination of objectives (b) Forecasting and choice of a course of action (©) Formulation of policies, programmes, budgets, schedules etc., to achieve objectives (a) Laying down of procedures and standards of performance. (i) Organising: Careful organising, like planning, helps in making efficient utilisation of human resources. It is a process of establishing, working relationship among employees. The various activities are assigned to them, authority is granted to them, and they are brought in the relationship of superior and subordinate. This working relationship brings order and discipline with organisation. Every employee knows who is superior and commands his activities and who is command by him. Similarly, in organising process role, relationship and position of each individual in the organisation is spelt out clearly. Organising may also be considered as a process of integrating, balancing, unifying and coordinating activities of various employers for the accomplishment of Pre-determined objectives. The process of organising involves creation of various units or departments, assigning, group of activities to them with enough authority and finally, seeking coordinated functioning of these in the context of the entire organisation. The process of organising consists of the following steps: (@) Determining and defining the activities required for the achieve- ment of planned goals (b) Grouping the activities into logical and convenient units (©) Assigning the duties and activities to specific positions and people (d) Delegating authority to these positions and people (e) Defining and fixing responsibility for performance and (® Establishing horizontal and vertical authority relationships throughout the organisation. (iit) Staffing: Once the structure of an organisation has been brought into existence by determining role and relationship of various positions, the next critical stage is manning these by individuals. Staffing is a s of determining quality and quantity of human force needed ganisation making all necessary arrangements for a and selection, maintaining them foree eae ee and finally, developing their capabilities and potential to them u Thus, the staffing function of management is mainly cone i manpower planning, recruitment, selection, training an develop 1 compensation and maintenance of human resources in the organisation, (iv) Directing: Directing is a process of helping and guiding subordj. nates to achieve objectives of the organisation. Basically, in the process of directing, the mwnager issues necessary orders and instructions to subordinates regarding the work which has been assigned them. He educates and guides them regarding various methods of doing the work and finally, he supervise, the work being performed by them ina regu- lar basis. In the process of directing, three elements are involved, namely, communication, motivation and leadership. In brief, for directing the activities of subordinates, a two-way communication has to be main- tained and simultaneously, the manager has to motivate the subordi- nates and provide a dynamic leadership. (v) Controlling: Controlling the process of ensuring that each and every activity has been performed in a planned manner and in conformity with pre-determined standards of performance. It is essentially a pro- cess, whereby standards of performance are determined for every employee and his actual performance is measured and then compared with these standards as to find out deviations and taking remedial measures to improve performance. The process of controlling includes alll activities, actions, procedures and methods used by managers for bringing actual results nearer to the desired results. The process of controlling is not only concerned with improving performance but it also includes all actions and tech- niques used by the organisation for regulating the use of the resources for achieving planned goals. It regulates working behaviour of em- ployees for maintaining order and discipline. It checks distortions and deviations taking place in the system to make it more cost effective.‘2.10 PRINCIPLES OF MANAGEMENT ne aenles of management are vital to organise and manage the pes: pen Fayol has suggested 14 Principles of management in order to make the job-of management more effective and efficient. These are outlined as under. (@) Division of work: Division of work helps to avoid waste of time and effort caused by changes from one work process to another. The principle of division of work implies that every employee should be assigned only one type of work. It is being applied to all kinds of work such as technical as well as managerial. Authority and responsibility: Authority responsibility are coexist- ent and they must go hand in hand. Authority should commen- surate with responsibility more authority may result in misutilisation or underutilisation of it. Therefore, there should be purity between authority and responsibility. Discipline: It implies compliance with organisational directives and rules, orders and instructions of superior and to cooperation with fellow workers. It is essential for all organisation. Discipline can be maintained with the help of good supervision at all levels, clear and fair agreements and judicially applied control system. Unity of command: According to this principle, one subordinate should get orders and instructions regarding his work only from one superior. It helps in maintaining discipline among employees, controlling their activities, fixing responsibility and not allowing them to side track responsibility. Unity of direction: All activities should be related towards com- mon goals should be included in single plan to be implemented by particular manager unity of direction implies that there should “one head and one plan for a group of activities having the same (ii) (iii) (iv) (v)Toe. Sasa: Remuneration: Employers should be paid fairly and a in ieorssces wath their contribution. The quantum and ‘ods of remuneration paid to employees should be satisfactory, to both employers and employees. * (viii) Centralisation: The relationship between centralisation and decentralisation of authority is a matter of proportion and opti- mum balance should be maintained according to the needs of organisation. (e), Scalar chain: It refers to the chain of superiors ranging from ultimate authority to the lowest rank. It is unbroken line of command from the top to the bottom of the organisation structure. It creates chain of superior subordinate relationship which is essence of achieving the goals of organisation. (%) Order: There must be order in an enterprise which facilitate ‘smooth flow of work and efficient use of resource materials, machine tools, equipments, etc. as well as employees (Human. factor). (xi) Equity: The principle of equity suggests that similar treatment based on the principle of equity fairness and impartiality should be assured to all employees working in the organisation. Man- agement should treat employees with justice and kindness. (xii) Stability of tenure of personnel: It takes time to learn and get used to a job. A reasonable security of service should be provided to all employees. Stability of tenure helps to develop loyalty and attachment on the part of employees. (xiii) Initiative: Employzes should be provided an opportunity to develop and use initiative for solving work-related problems. Due care should be taken specially for developing policies so as to regulate decision making behaviour of managers on the one hand and on the other to provide them enough liberty for using their personal skills and judgement. (xiv) Espirit-de-crops: It illustrates to build team spirit among the employees so that they work in harmonious manner with proper mutual understanding so as to make their respective contribu- tion for achieving goals 2.11 FUNCTIONS OF MANAGERS ‘The managers has a greater role to play in the modern business today. They have to apply the management process and its principles in order to achieve the objectives of business. The manager's function differ from ‘organisation to organisation such as selling, manufacturing, accounting, engineering and purchasing, These differ from one enterprise to another but the basic tasks of the manager as a manager, are common to all. ‘The basic functions of modern manager are enumerated as under. i;(@ Planning Manager has to plan which involves selecting objectives and the strat egies, policies, programmes and procedures for achieving them either for the entire enterprise or for any organised part of. Another aspect of manager in planning is of course, decision making, since it involves selecting from among alternatives. (ii) Organising Organising aspect of manager involves the establishment of an inten- tional structure of roles through determination of the activities required to achieve the goals of an enterprise and each part of it, the grouping of these activities, the assignment of such groups of activities to a man- ager, the delegation of authority to carry them out, and provision for coordination of authority and informational relationships horizontally and vertically in the organisation structure. The manager has a greater role, responsibility and functions in designing and developing organisation structure which helps to achieve the goals objectives and strategies of modern business. Gi The staffing function ofa manager involveS manning, and keeping manned, the positions provided for by the organisation structure. Staff function of manager thus necessitates defining manpower requirements for the job to be done, and it includes inventorying, appraising and silecting candidates for positions, compensating, and training ot otherwise developing both candidates and incumbents to accomplish their tasks effectively. Staffing (iv) Directing and Leading The directing and leading function of the manager is to influence the actions to his subordinates. The managerial task of direction contains the operations like (a) issuing orders and instructions (b) guiding and leading the subordinates and finally (c) supervising the affairs of the subordinates. Controlling2.12 QUALITIES OF A GOOD MANAGER. An efficient manager must have the following, qualities: ell educated and qualified. He d specific education in business ulate policies make decisions, (i) Education: A manager must be w should have both general education an administration. The manager has to formi ‘ x correspond and to understand the different business matters so, in order to be capable to perform these activities efficiently, he must be well educated. A manager should have the field knowledge whatever being the type of company or concern. (ii) Training: The manager must have the specific training for job he is required to perform. The training may be obtained before entering the service or it may be had in service. Refresher courses, if needed be also arranged. (iii) Leadership: Management is a team of work. The manager has to direct, supervise, guide and lead the efforts and energies of the employees. It is rightly said that it is very easy to work but it is very difficult to get the work done by others. The manager cannot perform all the activities of the business himself alone, therefore he should have the quality of leadership, so that he may extract the maximum worth of all the individuals. (iv) Personality: The manager should have effective personality. He should have sound healthy, good manners and behaviours. He should have pleasing personality, so that employees should accept him and his views. (v) Scientific outlook: Managerial decision regarding planning, organising. and selection of employees should not be based upon emotions but on. the logical considerations. Every important decisions should be fair and unbiased. The methods and technique of production should be most appropriate, taking into view the real situations and the available resources of the business. (vi) Ability to do and get work done: The management must know work, he is assigned. It will be appreciated, if he understands the supervise. He is to plan the course of action and also to e:SENT OS [ig PART ND OE PACER the work. He is required to be well versed in the art and technique of extracting the maximum contribution of subordinates. (vii) Self Confidence: The manager has to self-confident about his decisions. He should take important decisions after careful study and Scientific analysis of facts and must not change it from time to time upon the advice of certain employees. i (viii) Honesty: Itis rightly said ‘honesty is the best policy’ in the business. The manager being in charge of the enterprise must be honest and Possess good moral character, so that he may expect the same standard of integrity from the subordinates. (ix) Technical proficiency: The manager should be technically proficient. His qualification, ability and experience must correspond to the needs of the enterprise. He cannot effectively supervise what he himself does not know. (x) Human touch: The manager must accord human treatment to his subordinates. He must honour the emotional and psychological needs of employees. He should not be cruel and exploiter in his dealings. The quality of human touch will bring him nearer to employees, who will in turn offer their best services and as a result maximum business objectives can be attained at minimum wastage and cost. In addition to the above qualities the manager should have dynamic personality to deal with the various specific business realities and situations. :eS ENnIEIC MANAGEMENT ce Scientific era was pioneered mainly by F.W. Taylor, Frank Gilbreth, Lillian Gilbreth, Harry L. Gantt, Harrington Emerson and C. Bertrand Thompson. 4 E,W. Taylor (1856-1915): Fredrick Winslow Taylor is known as the father of scientific management. Taylor started his career as an appren- tice in a small machine shop in Philadelphia (USA) in 1875. In 1878, he joined the Midvale Steel Works in Philadelphia as machinist and rose to the position of Chief Engineer in 1884. Later he joined the Bethelhem Steel Works. Throughout his career, Taylor was concerned with the problems of increasing labour productivity without putting under strain on workers. He has conducted several experiments and through his experiments he has developed a theory of management which was known as “Scientific Management”. Therefore, Taylor was called as “Bather of Scientific Management.” Taylor's idea are found in his two books titled “Scientific Management” and “Shop Management”. Tay- lor was assisted in the development of scientific management by many other pioneers like Henry L. Gantt, Harlow S. Person, Harrington Emerson, Frank B. Gilbreth, Lillian Gilbreth and so on. Meaning of Scientific Management Scientific management implies the application of scientific methods of study and analysis to the problems of management. It is a systematic and thoughtful approach to the job of management as compared to the rule of thumb, or trial and error approaches. It is concerned with scientific approach of techniques to improve efficiency. Definitions of Scientific Management (i) Scientific management means knowing exactly what you V your men to do and seeing that they do it in the best and | Pe cheapest way. —F.W. TiZ Principles of Scientific Management The philosophy of scientific management is based upon the following principles: (i) Science not rule of Thumb: The first principle of scientific management requires scientific study and analysis of each element of a job in order to replace the old rule of thumb approach development of a science for each element of a man’s job requires that decisions should be made on. the basis of facts rather than opinions and beliefs. (ii) Scientific selection, training and development of workers: This principles requires that workers should be selected and trained in accordance with the requirements of the jobs, to be entrusted to them. Instead of allowing workers to learn themselves, systematic training and development programmes should designed to improve their skills and efficiency. Efforts sho ld be made to develop each employee to his greatest efficiency (iii) Close cooperation between workers and management: Close coopera tion between management and workers to ensure that work is done in accordance with the developed scientific principles. The interests of employer and employees should be fully harmonised so as to create a mutually beneficial relationship (iv) Equal division of work and responsibility: Management should assume the responsibility for which it is better suited. Management should decide the methods of work, working conditions, time for completion: of work, etc. instead of leaving them to the discretion of the workes. In other words, management should take more responsibility for planning, and supervision of the work, while the workers should be concerned with the execution of plans. (v) Maximum prosperity for both employers and employees: The aim of management should be to secure maximum prosperity for each employee along with maximum prosperity for the employer. This can be possible when efficiency and output are maximised. Maximum output and optimum utilisation of resources will bring higher profits to the employers coupled with higher wages and salaries for employees. (vi) Mental revolution: It means a complete change in the outlook of ‘management and workers with respect to their mutual relations — and i ‘elation to work effort. Instead of fighting on the division of * iss80 + Manogement—Princpes and Pras surplus of industry, they should work together to increase the surplus so that each one can get more. ¥ Techniques of Scientific Management it F essence of scienti iples constitute the philosophy or ¢ of scientific anggement In order to implement the principles of scientific management, Taylor and his associates developed the following techniques, + (i) Scientific Work Study Work study refers to the systematic objective and critical examination ‘ofall factors influencing the efficiency of operations to improve thereon, It involves the measurement and improvement of work. This study includes Method study, Motion study, Time study and Fatigue study. {@) Method Study: The purpose of this study is to maximise efficiency in the use of materials, machinery, manpower and capital by improving work methods. This study involves the critical ‘examination of plant layout, product design, material handling and work processes, to minimise time, distance and cost involved in the transportation and storage of materials. Motion Study: This study refers to the study of the movements of an operator or a machine involved in a task with a view to elimi: Rate superfluous or useless motions and to improve the others ‘This study i the science of eliminating wastefulness resulting, from using unnecessary illdirected and inefficient motions, (©) Time Study: This study refers to the study of the time t perform each operation of ajob in order to find out the proper time that should be taken in doing the job, It is the art of recording, anal lysing and synthesising the time elements of any (d) Fatigue Study: Fatigue study seeks to find out how | can perform the standard task without adve and efficiency © taken to operation, long a person rse effect on his health (ii) Scientific Task Setting Pétenlfic planning of a task is the technique of forecasting and view- ing ahead every step in along series of separate operations, Each step fas tos taken in the right place, ofthe right degree, and at the right following a ork can be done with maximum possible efficiency. The following steps are involved in scientific task planning. {@) Routing: It implies iaying down the route or path tobe followed by Gach piece of raw material before its conversion into the finished product.SION OT ARSE REIL I eee oS ae (b) ts ihe a time table of operations is prepared to ensure er ache Piece of work at the right time, It determines iority for its complation oY fF ech operation and the me tobe taken for © papeichng: It involves assembling of necessary resources assign- of jobs, Supervision of work, enforcing discipline and coordi- fi nating activities of different individual. (@) Follaw ub Une last step in scientific task planning is checking of work and taking corrective steps to ensure that each piece of work is completed at the right time inthe right amount and at the right, (iii) Standardisation Standardisation is the process of fixing well thought-out and tested standards of norms with a view to maximise efficiency of work. Standardisation of product implies that the size, design, weight, shape, quality, etc. of the product should be such that it meets the require- ments and tastes of customers. Standardisation eliminates needless variety and thereby simplifies the process of production. (iv) Selection and Training Proper selection and training is tool and on this basis of an objective criteria necessary to match the job and job holder. After the employees are selected, they should be placed on the right jobs. A systematic programme is required for continuous training and development of workers, (v) Differential Piece Rate System He has suggested the use of differential piece rate system in order to motivate workers to produce maximum quantity. Two piece rates are used, one higher rate for those workers who produce less than stan- dard output or more and the other lower rate for those workers who produce less than standard output. Standard output is fixed through. time and motion studies. _ (vi) Functional Foremanship Taylor introduced and practiced the concept of functional foreman- ship, According to this concept instead of having one foreman as an incharge for production department all activities should be grouped into two groups namely planning forum and workshop, Each forum should have four supervisors to command over the activities of work- In doing so dual command emerges because each worker will get d fons from eight supervisors dealing with different ,job. This is illustrated with the help of the chart as under.sisi diystewo04 jeuop2ung pas =a = sana s (sea ea vevemidosia | | Gononsuy ue oun, f f f t t qwepueiapedns Wed f JoBeUEN LOM,‘services to customer ete. and choose the most appropriate course of action. Planning is a mental exercise that requires imagination, foresight and sound judgement. Itis thinking before doing, Planning is looking ahead, anticipating the future and deciding the course of action to be taken. Planning involves choic¢ among alternative course of action. Important definitions of planning are given as under: Planning is deciding in advance what is to be done. When a manager plans, he projects a course of action for the future, attempting to achieve a consistent, coordinated structure of operations aimed at the desired results. —Theo Hainann Planning is fundamentally a mental predisposition to do things in an orderly way, to think before and to actin the light of the fact rather than of guesses. LF. Urwick The plan of actions, at one and the same time the result envisaged, the line of action to be followed, the stages to go through and the methods to use. —Henri Fayol Planning is deciding in advance what is to be done. It involves the selection of objectives, policies, procedures and programmes from among alternatives. —M.E. Hurely Planning is deciding in advance what to do how to do it, where to do it and who is to do it. Planning bridges the gap from where we want to go. It makes it possible for things to occur while would not otherwise happen —Koontz and O'Donnell 4.2. FEATURES OF PLANNING An analysis of the above definitions reveals the following features of planning, () Planning is goal-oriented: Planning seeks to achieve certain objec- tives and all plans are linked with the goals of the organisation. Planning will become a useless exercises ifit does not contribute in some positive way to the accomplishment of desired objectives. Planning identifies the actions that would lead to the desired results quickly and economically. Thus, planning is purposeful. (ii) Plarining is future oriented: Planning is essentially cooking ahead and preparing for the future. It is based on the proverb “look before you leap’. Planning seeks to manage future event to the best advantage of the organisation. It is essential to anticipate or predict the future. Scientific anticipation of future eventsis called forecasting which serves as the basis of planning. For example,15 at intellectual process: Planning is a mental «, __ involving creative thinking and imagination. A ma, a re sound plans only when he has sound judge, foresight and vision. Planning is not mere guess wo,)' a logical and systematic thinking. It requires a 1, predisposition to think before acting. It requires a cone iouy determining of course of action on the basis of goals, facts ang considered estimates. iv) Planning is primary function: Planning saves as the basis another functions of management. It precedes organisi staffing, directing and controlling, All these functions ge performed within the framework of plans. By specifying Objectives and the ways of achieving them planning provides the foundation for managerial action. Therefore, planning is the most basic function. (©) Planning is peroasive: Planning is required in all types of "organisations and at levels of management. Every department ‘Prepares plans. However, the slope of planning may differ from ‘ne level to another. For example, top management plans for the organ is action as a whole. Middle management prepares departmental plans. At the lower level supervisors formulate day-today operational plans. (i) Planning ts continuous: Planning is an ongoing process. Plans are prepared for a specific time period e.g. one year. At the end of the period, new plans have to be prepared. Similarly as ‘conditions change, existing plans to be revised. This, pl is anever-ending exercise. Planning involves choice pl essentially the process of choosing from among alter courses of action. It there is only one possible alternative, snoneed for planning as there no choice, The need for planning arises because there, exists alternative goals as well as different ‘Ways of reaching the goals. For example, a person who wants to Manufacture and sell ball pens may either construct his own factory or may take an existing factory on rent. In order to make the right choice, itis necessary to evaluate and compare the two alternatives (vit) Planning aims at ficiency: Plens are prepared to achieve the ob- Jectives in the best way. Sound planning leads to accomplish- ment of desired objectives atthe minimum possible cost, I helps _ inoptimisation of resources. A plan is worthless if it is not worth. ‘the cost incurred on it. A good plan should provide maximum to those responsible for its execution unplanned are likely to result in undesirable consequences. ae lanning lanning is ative there:OF PLANNING essential condition for effective management. tages of sound planning are as under: ‘Making objectives clear: Planning makes goals clean and specific. ‘Thisisbecause goals are to be achieved are decided before choos- ‘ing the course of action. Planning focuses attention on the or- ‘Banisational objectives. Plans serve as a guide for deciding what fations should be taken. With clear goals activites become mean- ingful. (8) Helps the organisation a right path: Planning helps the organisation to keep on the right path. Employees understand how their action telate to organisational goals. Planning avoids aimless and ad hoc action. It also avoids the need for snap decisions based on impulse and intuition. Planning provides systematicand orderly efforts towards the goals. Without goals, decisions become ad .... h0c choices become meaningless. (ii) Te reduces risk and uncertainty: Business enterprises operate in an uncertain environment. Planning enables these enterprises to Predict future events and prepare to face the unexpected events with the help of planning, managers can identify potential dangers and take-steps to over come them. Thus, planning is helpful in assessing and meeting future challenges. (iv) It improve efficiency of operations: Planning involves selection of best possible course of action. It helps to eliminate all types of waste and to achieve optimum utilisation of available resources. Planning isa rational activity that leads to efficient and economi- cal operations. It is the foundation of the most successful actions ofany enterprise. Planned action is always better than unplanned action. Planning makes the total task of managing more efficient and effective. It helps to minimise the cost of operations and improves the competitive strength of an enterprise. (v) Provides the basis for control: Planning provides the standard against which the actual performance can be measured and evaluated. A comparison of performance with the desired result helps to identify the deviations and to take corrective steps to make the events confirm to plans, Planning makes control, meaningful and effective, Thus, planning provides the basis for control. (vi) Facilitates decision making: Planning lays down targets. With the _ help of these targets managers can better evaluate alternative x of action and select the best alternative. Plat of future conditions. With the help of play id random actions can be avoided.LIMITATIONS OF PLANNING jon of management Although Planning is pervasive and primary functio ‘and it has many advantages for the organisation, in actual practice, ‘there are many barriers and limitations of planning. If planning is to '. be useful and purposeful, it necessary that the manager understands them. Some of the limitations are as under: (@ Planning Premises may not be fully reliable: The premises, assump. tions and the facts on while planning is based may not come to be true. (Gi) Dynamic conditions act asa limitation of planning: The assumption ‘on which planning is based may not hold good and the condi- tions under which plans are being implemented may differ from the assumed conditions. (ii) Aonilability of time isa limiting factor of planning: Planning is time ‘consuming. Sometime it causes delay in taking actions. Emer- gency situations in business require prompt action and allow little time for thinking and planning. (iv) Costinvoloed in planning is also. limiting factor: Planning is a costly process. A good deal of time, energy and money is involved in gathering of facts and testing of various alternatives. \ (Mental attitude of management can be serious limiting factors to plan- ning: Some persons are psychologically opposed to planning as they consider the present more important than the future. They think that future cannot be predicted and certainty and that present is certain. These people have a natural resistance to change. Mc Farland calls it as psychological barrier to planning. (vi) Procedural and policy rigidities also proved fo be a hindrance to plan ning: Planning has a tendency to make administration rigid and inflexible. Procedure, rules and policies once established are dif- ficult to change. This limitation curbs initiative as it forces the ‘manager to operate within the limits of planning (vii) Capital invested in the fixed assets may be limitation to planning: Once ee is invested in a certain equipment and replacement of "which is costly, future planning would be limited, the above limitations to planning are internal. There are some constraints on planning also, over which the manager has little rol at all. The environmental for us that influence planning,a ORME ES SON aaa ee _manager, He makes decisions for solving problems, handling'the situ- oe resolving. crises. By making decisions the manager translates N ious plans such as objective, policy, strategy, etc. into action, These eons ate converted into outcome or results by implementing Decisions are made on manageri i ec ade ¢ agerial functions like planning, organising, staffing, directing, controlling and other matters related ¢ ersorney nctonal ateas such as production, marketing, finance and one option is available to the ma i manager. By taking a decision, a man- ager attempts to reduce the gap between the present and the desired situation. A few important definitions are given below: __ Management decision making is a work the manager performs to arrive at a conclusion and judgement”, —Alllen _ Decision making is a conscious and human process involving both individual and social phenomenon based upon factual and value pre- mises which concludes with a choice of one behavioural activity among ‘one or more alternatives with the intention of moving towards some desired state of affairs”. —Shull, Delberg and Cumming “It is a process of a solution selected after examining several alter- natives chosen because the decider forsees that the course of action he elects will do more than the others to further his goals and will be accompanied by the fewest possible objectionable consequences”. —Manley H. Jones “Decision making is a process of identifying and choosing alterna- tive courses of action in a manner appropriate to the demand of the situation. The act of choosing implies that alternative courses of action must be weighted and weeded out”. —Kreitner “Whatever manager does, he does through decision making”. —Peter Drucker According to him in every situation, a manager faces a challenge ‘of making correct, timely and effective decisions to get the best out of the situation, Alll decisions made by managers are directed at making“ction which is thought to fulfil the object ‘more satisfactorily than others. It is a course of action , j ciously chosen for achieving a desired result. A decisi thing that ake place prior to actual performance of a course! that has been chosen. To state this in terms of iandgeval a making, it is an act of choice wherein a manager selects m < course of action from the available alternatives in a given er Managerial decision making involves the entire process of ey ing goals, defining tasks, searching for alternatives and dey, plans in order to find the best answer to the decision probie element in a process of decision making includes the following 4 i) The decision maker, bi i) The decision problem, ii) The environment in which the decision is to be made, (iv) The objectives of decision maker, 4 (v) The alternative courses of action, (vi) The outcomes expected from various alternatives and (vii) The final choice of the alternative characteristics of deci making. Characteristics of Decision Making The basic characteristics of decision making are enumerat below: (@ Ib is a process of choosing a course of action from among alternative courses of action. (ii) Itis a human process involving to great extent the applica of intellectual abilities (iii) Ttis the end process preceded by deliberation and reasoning (iv) It is always related to the environment. A manager may ti one decision in a particular set of circumstances and another a different set of circumstances. (v) It involves a time dimension and a time lag. (vi) Italways has a purpose. Keeping this in view, there may just a decision not to decide. (vii) Itinvolves all actions like defining the problem and probinga? analysing the various alternatives which take place befot final choice is made. d