I SEMESTER BBA

BUSINESS MANAGEMENT COURSE CONTENTS

UNIT 1 INTRODUCTION TO MANAGEMENT 10 Hours Evolution of management
thought: Classical School of thought (Contributions of Taylor and Fayol) – Neoclassical
School – Human Relations Approach (Hawthorne Experiments) and Behavioural Science
Approach (brief outline) – Modern Management Theory - Quantitative Approach, Systems
Approach and Contingency Approach. Nature and significance of management - Managerial
roles - Mintzberg - An overview of functional areas of management - Principles of
Management – Managerial skills set - Types of Business, CSR.
UNIT 2 PLANNING, FORECASTING AND DECISION MAKING 08 Hours Planning:
Concept, process and objectives – Types of plans – MBO & MBE, Corporate planning:
Environment analysis and diagnosis. Forecasting: Meaning and purpose of forecasting –
Techniques of forecasting - Qualitative and quantitative Decision making: Concept and
process; Delegation and Principles of delegation: Strategy Formulation.

Introduction
Management is a soft science or a practical art. Its principles are derived from the working of
industry, government, human psychology and social theories. Knowledge of the basic
principles and theories of management helps in practicing management by way of increasing
efficiency and effectiveness, and helps in avoiding mistakes.
Modern management thought has evolved over the years from contribution from various
disciplines such as social psychology, behavioural science, operational research and systems
theory; technology and economics. This has given rise to different approaches to the study of
management science. These approaches include empirical approach; interpersonal and group
behaviour approach; co-operative, social and socio-technical systems approach, systems
approach, decision theory and operational research approach; contingency or situational
approach, managerial roles approach and operational approach.
The purpose of studying various schools of management thought is to enable you to
recognized and appreciate how developments in the field of management could contribute to
current practices. An examination of these past and present approaches can help to discover
the strengths and weaknesses of current managerial practices and finally enable you, as a
potential manager of an information centre, to choose appropriate management styles.

Classification of management theories

Hitt and others (1979) classify management theories into three broad groups.
1. Classical management theory.
2. Neoclassical management theory.
3. Modern management theory.
1.Classical management theory: The classical management theory is referred to the period
between 1880s and 1920s. This phase consists of Scientific management of F. W. Taylor and
his followers, Administrative management of Henry Fayol and others, and Bureaucratic
organisation of Max Weber. The classical theory emphasised the economic rationality of
management and organisation, and suggested to determine the best way to perform a job.
This theory is criticised for its assumption that people are motivated primarily by economic
reward.
2.The Neo-classical theory, which is identified with the period from 1920s to 1950s, is
concerned with the human oriented approach and emphasised the needs, drives, behaviours,
and attitudes of people. The human relations school together with (early) behavioural schools
constitutes this group. The social person view of employees is the basis of this set of schools.
The famous Hawthorne experiment conducted by Mayo, Roethlisberger and Dickson is a
milestone in the endeavours of this school. Several behavioural scientists including Maslow,
Mc Gregor, Argyris, Herzberg and Likert have contributed to this school as well as to
organisational humanism school under the modem management theory. This school is
criticised for its over emphasis on human variables and symbolic rewards which may not be
appreciated by the recipient's `significant others'.
3. Modern management theory: The complex employee view has become the basis of
modern management theory which began around 1950s (more particularly with revisionists
movement propounded by Litchfiled in Administrative Science Quarterly in 1956). This
group tried to test the views of earlier schools and accept them selectively. In the process it
has made use of many tools like computers and mathematical techniques and theories from
other disciplines like systems theory, decision theory, behavioural science, etc. Four
important schools in this group are systems theory, contingency theory, organisational
humanism and management science.

The primary contributions of the classical school of management includes (i) application of
science to the practice of management (ii) development of the basic management functions
and (iii) articulation and application of specific principles of management.
FW Taylor Principles of Scientific Management

Principles of Scientific Management by Taylor:F.W. Taylor or Fredrick Winslow Taylor,

also known as the ‘Father of scientific management’ proved with his practical theories that a
scientific method can be implemented to management. Taylor gave much concentration on
the supervisory level of management and performance of managers and workers at an
operational level. Let’s discuss in detail the five principles of management by F.W Taylor.
1. Science, not the Rule of Thumb-This rule focuses on increasing the efficiency of an
organisation through scientific analysis of work and not with the ‘Rule of Thumb’ method.
Taylor believed that even a small activity like loading paper sheets into boxcars can be
planned scientifically. This will save time and also human energy. This decision should be
based on scientific analysis and cause and effect relationships rather than ‘Rule of Thumb’
where the decision is taken according to the manager’s personal judgement.
2. Harmony, Not Discord-Taylor indicated and believed that the relationship between the
workers and management should be cordial and completely harmonious. Difference between
the two will never be beneficial to either side. Management and workers should acknowledge
and understand each other’s importance. Taylor also suggested the mental revolution for both
management and workers to achieve total harmony.
3. Mental Revolution-This technique involves a shift of attitude of management and workers
towards each other. Both should understand the value of each other and work with full
participation and cooperation. The aim of both should be to improve and boost the profits of
the organisation. Mental Revolution demands a complete change in the outlook of both the
workers and management; both should have a sense of togetherness.
4. Cooperation, not Individualism-It is similar to ‘Harmony, not discord’ and believes in
mutual collaboration between workers and the management. Managers and workers should
have mutual cooperation and confidence and a sense of goodwill. The main purpose is to
substitute internal competition with cooperation.
5. Development of Every Person to his Greatest Efficiency-The effectiveness of a
company also relies on the abilities and skills of its employees. Thus, implementing training,
learning best practices and technology, is the scientific approach to brush up the employee
skill. To assure that the training is given to the right employee, the right steps should be taken
at the time of selection and recruiting candidates based on a scientific selection.
These five (5) principles of scientific management process involved experiments,
observation, analysis, and inference and were applied to create a cause and effect
relationship.

Henri Fayol 14 Principles of Management

Henry Fayol, also known as the ‘father of modern management theory’ gave a new
perception of the concept of management. He introduced a general theory that can be applied
to all levels of management and every department. The Fayol theory is practised by the
managers to organize and regulate the internal activities of an organization. He concentrated
on accomplishing managerial efficiency.

The fourteen principles of management created by Henri Fayol are explained below.
1. Division of Work-Henri believed that segregating work in the workforce amongst the
worker will enhance the quality of the product. Similarly, he also concluded that the division
of work improves the productivity, efficiency, accuracy and speed of the workers. This
principle is appropriate for both the managerial as well as a technical work level.
2. Authority and Responsibility-These are the two key aspects of management. Authority
facilitates the management to work efficiently, and responsibility makes them responsible for
the work done under their guidance or leadership.
3. Discipline-Without discipline, nothing can be accomplished. It is the core value for any
project or any management. Good performance and sensible interrelation make the
management job easy and comprehensive. Employees good behaviour also helps them
smoothly build and progress in their professional careers.
4. Unity of Command-This means an employee should have only one boss and follow his
command. If an employee has to follow more than one boss, there begins a conflict of interest
and can create confusion.
5. Unity of Direction-Whoever is engaged in the same activity should have a unified goal.
This means all the person working in a company should have one goal and motive which will
make the work easier and achieve the set goal easily.
6. Subordination of Individual Interest-This indicates a company should work unitedly
towards the interest of a company rather than personal interest. Be subordinate to the
purposes of an organization. This refers to the whole chain of command in a company.
7. Remuneration-This plays an important role in motivating the workers of a company.
Remuneration can be monetary or non-monetary. However, it should be according to an
individual’s efforts they have made.
8. Centralization-In any company, the management or any authority responsible for the
decision-making process should be neutral. However, this depends on the size of an
organization. Henri Fayol stressed on the point that there should be a balance between the
hierarchy and division of power.
9. Scalar Chain-Fayol on this principle highlights that the hierarchy steps should be from the
top to the lowest. This is necessary so that every employee knows their immediate senior also
they should be able to contact any, if needed.
10. Order-A company should maintain a well-defined work order to have a favourable work
culture. The positive atmosphere in the workplace will boost more positive productivity.
11. Equity-All employees should be treated equally and respectfully. It’s the responsibility of
a manager that no employees face discrimination.
12. Stability-An employee delivers the best if they feel secure in their job. It is the duty of
the management to offer job security to their employees.
13. Initiative-The management should support and encourage the employees to take
initiatives in an organization. It will help them to increase their interest and make then worth.
14. Esprit de Corps-It is the responsibility of the management to motivate their employees
and be supportive of each other regularly. Developing trust and mutual understanding will
lead to a positive outcome and work environment
This 14 principles of management are used to manage an organization and are beneficial for
prediction, planning, decision-making, organization and process management, control and
coordination
Maximilian Karl Emil Weber ( 21 April 1864 – 14 June 1920)

Maximilian Karl Emil Weber ( 21 April 1864 – 14 June 1920) was a German sociologist,
historian, jurist, and political economist regarded as among the most important theorists of
the development of modern Western society. His ideas profoundly influence social theory
and research.

Max Weber’s Bureaucratic Form – 6 Major PrinciplesMax Weber identified the

following six core principles of the bureaucratic form:

 A Structured Hierarchical Structure: In a bureaucratic organization, each level

governs the level below it. Also, the level below it governs it. The foundation of
central planning and centralized decision making is a formal hierarchy.
 Rules-Based Management- To exercise control, the company uses rules. Therefore
at higher levels, the lower levels effortlessly execute the decisions made.
 Organization of Functional Specialties - Specialists do the job. The company often
breaks workers into groups depending on the type of work they do or the abilities they
possess.
 Up-Focused Or In-Focused: If the organization's purpose is to represent the
stockholders, board, or some other institution that motivated it then it is up-focused.
On the other hand, it is in-focused if the goal is to serve the company itself and others
inside it (like producing income, etc.).
 Impersonal - All workers are handled fairly by hierarchical organizations. They also
fairly treat all clients and do not allow individual differences to affect them.
 Employment-oriented Professional Qualifications - Selection is based on technical
qualifications and skills as well as employee promotion.

Features of Bureaucratic Organization

 A well-defined chain of command exists.

 The high level of Division of Labor and Specialization.
 It follows Rationality, Objectively, and Continuity theory.
 The relationship between the members of the association is formal and impersonal.
And it's focused not on personalities, but roles.
 The rules and regulations are well defined and employee duties and privileges are
indicated. Such ideals range from the bottom of the organization to all and must be
strictly observed.
 Professional credentials are used for selection and promotion.
 Relevance is granted only to bureaucratic or legal authority.
Harold Koontz and Cyril O'Donnell

Harold Koontz and Cyril O'Donnell propounded a new school of thought known as the
management process school.

They believe that management is a dynamic process of performing the functions .of planning,
organising, staffing,directing and controlling. These ' functions ' and the principles, on which
they are based, are believed to have general and universal applicability.

Managers perform the same functions irrespective of their levels and the difference, if any,
will be in the degree of complexity. These functions are applicable to all organisations
wherever group effort is involved and the management theory is not culture bound.

In other words these functions are all pervasive. For the same reason the management process
approach is also called the universal approach

Frank Bunker Gilbreth (July 7, 1868 – June 14, 1924

Frank Bunker Gilbreth (July 7, 1868 – June 14, 1924) was an American engineer, consultant,
and author known as an early advocate of scientific management and a pioneer of time and
motion study, and is perhaps best known as the father and central figure of Cheaper by the
Dozen.

Lillian Evelyn Gilbreth (May 24, 1878 – January 2, 1972)

Both he and his wife Lillian Moller Gilbreth were industrial engineers and efficiency experts
who contributed to the study of industrial engineering in fields such as motion study and
human factors.
Lillian Evelyn Gilbreth was an American psychologist, industrial engineer, consultant, and
educator who was an early pioneer in applying psychology to time-and-motion studies. She
was described in the 1940s as "a genius in the art of living
Mary Parker Follett (3 September 1868 – 18 December 1933)
Mary Parker Follett (3 September 1868 – 18 December 1933) was an American social
worker, management consultant, philosopher and pioneer in the fields of organizational
theory and organizational behavior. Along with Lillian Gilbreth, she was one of two great
women management experts in the early days of classical management theory. She has been
called the "Mother of Modern Management
Follett made the case that leaders should value group power over personal power. Her
theory suggests that true leaders create power for the group rather than keeping it for
themselves. After all, organizations do not exist for one person's benefit, but rather for the
entire company of workers and customers.

George Elton Mayo (26 December 1880 – 7 September 1949)

George Elton Mayo (26 December 1880 – 7 September 1949) was an Australian born
psychologist, industrial researcher, and organizational theorist. Mayo worked from 1926-
1949 as a professor of Industrial Research at Harvard University. He is best known for his
work based on the Hawthorn Studies, as well as his book, The Human Problems of an
Industrialized Civilization. Elton Mayo is considered as the father of the human relations
movement, which 'later become organisational behaviour. The other two important co-
researchers of this school are F.J. Roethlisberger and William J Dick

Elton Mayo's management theory promotes the hypothesis that workers are motivated by
social and relational forces more than financial or environmental conditions. It holds
that managers can increase productivity by treating employees as unique individuals rather
than interchangeable cogs in a machine.
The social person view is that (i) individuals are motivated by social needs (ii) people obtain
their sense of identity through Interpersonal relationships (iii) because of industrial progress
and routinisation, the work has become dissatisfying (iv) employees are more responsive to
the social forces of peer groups than to incentives and controls of management (v) employees
respond to provisions for their social needs and acceptance offered by management.
The social person view of human relations school has necessitated managerial strategies for
improving the human skills of the supervisors, replacing individual incentive plans by group
incentive plans; focusing on employees' feelings and attitudes, and their effect on
productivity rather than managerial functions.

Mayo not only identified the Hawthorn Effect, he was also the first to identify the importance
of the psychological element of workplace motivation. He recognized that if you treat an
employee well, they might be more productive for the organization
Modern management theory
Modern management theory highlights, the complexity of the organisation as well as
individuals and the diversity of their needs, motives, aspirations and potentials. As a result,
one time status or universal management principles are impracticable. The complexities
require intricate managerial strategies for dealing with people and organisation.
As against the rational economic man of the classical theory and the social person view of
neoclassical theory, the complex employee view is the premises of modem management
theory. The complex employee view holds that people are both complex and variable. They
have many motives, learn new motives through experience and motives vary from
organisation to organisation and department to department. Complex interactions relate the
employee and the organisation. There is no single managerial strategy that works for all
people at all times. Managers can employ different strategies at different times and for
different persons. Analytical tools may be useful while applying managerial strategies. Four
important modern management theories arising out of the complex employee view, are
systems theory, contingency theory, organisational humanism, and management science.

Systems Theory: As noted earlier, the drawback of the classical theory and the neoclassical
theory is emphasising one aspect at the cost of the other. The classical theory emphasised the
`task', `structure' and `efficiency' and the neoclassical theory emphasized 'people'. Systems
theory has come up as via media with an integrated and holistic approach to management
problems. This has emerged as a way of looking at the organisation as a whole. Chester
Barnard, George Homans, Philip Selznick and Herbert Simon are some of the advocates of
the systems theory.
Contingency approach: In other words, each manager's situation must be viewed separately.
Wide range external and internal factors must be considered and then the focus should be on
the action that best fits the given situation. This approach, in a way attempts to integrate the
various schools of management thought, otherwise it is obvious that the principles and
concepts of various schools have no general and universal applicability under all conditions.
The contingency approach suggests that managers need to be developed in skills, that are
most useful in identifyin the important situational factors. They should be able to identify
which technique, in a particular situation, will best contribute to the attainment of
management goals.
Organisational Humanism: This school of thought is an extension of behavioural schools of
neoclassical theory and hence has much in common with behavioural schools. Some of the
researchers like Chris Argyris, Douglas Mc Gregor and Abraham Maslow mentioned under
behavioural schools, are the propounders of organisation humanism or the modem
behavioural school. The underlying philosophy of this school is that individuals need to use
all of their capacities and creative skills at work as well as at home. This `self-actualizing vie '
is the basis of this school
Management Science should not be confused with scientific management of classic theory.
However, the management science approach, also known as quantitative approach, has
evolved from the early application of some of the scientific management techniques of
classical theorists. Because of the complexities of organisations discussed earlier, today's
managers are required to have more and better information in order to make effective
decisions. The management science approach proposes the use of quantitative technique to
aid decision making. Despite voluminous data to be analysed and sophisticated computations
to be done, a wide variety of quantitative tools have been developed and high-speed
computers deployed in the analysis of information. This approach gained momentum during
the Second World War, when interdisciplinary groups of scientists, called Operations
Research Teams, were engaged to seek solutions to many complex problems of war. These
teams constructed mathematical models to simulate real life problems, and by changing the
values of variables in the model, analysed the effect of changes and presented a rational basis
for decision makers. Tools such as linear programming, queuing theory, simulation models,
CPM, PERT, inventorycontrol and quality control tools were extensively used in this
approach. Thus the focus of management science or quantitative approach is on making
objective and rational decisions. Objective rationality implied an ability and willingness to
follow a reasoned, unemotional, orderly and scientific approach, in relating means with ends
and in visualising the totality of the decision environment. It is an attempt to rationalise and
quantify the managerial process.

Peter Ferdinand Drucker (November 19, 1909 – November 11, 2005)

Peter Ferdinand Drucker (November 19, 1909 – November 11, 2005) was an Austrian-
American management consultant, educator, and author, whose writings contributed to the
philosophical and practical foundations of the modern business corporation.

Peter Drucker revolutionized the approach to business management by suggesting that

successful leaders should put people and ethics first rather than focusing entirely on profits
and rigid rules and work structures.
The pillars of Drucker’s theory of management are decentralization, prioritization of
knowledge work, management by objectives, and SMART goals.
By implementing Drucker’s approach, managers can empower their employees, improve the
company’s culture, encourage innovation, increase efficiency, create a nurturing and ethical
work environment, and ultimately boost the business’s success.
He was also a leader in the development of management education, for his impeccable
contribution towards management he has been described as "the founder of modern
management
Peter Drucker's secrets of managing effectively are: setting objectives, organising the
group, motivating and communicating, measuring performance and developing people.

Management
Management is the process of planning and organising the resources and activities of a
business to achieve specific goals in the most effective and efficient manner possible.
Efficiency in management refers to the completion of tasks correctly and at minimal costs.
Effectiveness in management relates to the completion of tasks within specific timelines to
yield tangible results.
A'Management Is a distinct process consisting of planning, organising, actuating and
controlling; utilising in each both science and art, and followed in order to accomplish pre-
determined objectives."
According to Harold Koontz, “Management is an art of getting things done through and
with the people in formally organized groups. It is an art of creating an environment in
which people can perform and individuals and can co-operate towards attainment of group
goals”.
“Management is a multi-purpose organ that manages business and manages managers and
manages workers and work.” This management definition was given by Peter F. Drucker in
his book, The Practice of Management
Mary Parker Follet defined management as "the art of getting things done through people".
Management is the process of designing and maintaining an environment in which
individuals, working together in groups, efficiently accomplish selected aims. Management is
defined as the process by which a co-operative group directs actions towards common goals.

Vital Objectives of Management:

 Organisational Objectives: Management is accountable for establishing and

attaining objectives for the company. It has to deliver a variety of objectives in all
operations contemplating the interest of all shareholders including, stakeholders,
consumers, the government and employees. The principal objective of any company
must be to use material and human resources to the maximum potential benefit, i.e., to
meet the financial objectives of a firm. And, they are survival, profit and growth.
 o Survival: The essential objectives of any industry is survival. Management
must attempt to assure the continuation of the business. In order to survive, an
industry must gain enough funds to meet the costs that would be incurred.
o Profit: Poor survival is not sufficient for the industry. Management has to
make sure that the company earns the profit. Profit contributes to a necessary
catalyst for the sustained successful performance of the firm. Profit is crucial
for meeting the costs and uncertainties of the business concern.
o Growth: A firm requires to add to its chances, in the long run, for this it is
necessary for the concern to develop. To prevail in the business, management
must utilise adequately the growth potential of the firm.

 Social objectives: It includes the establishment of benefit for the community. As a

part of the community, every business whether it is a trade or non-trading concern has
a social responsibility to meet. This applies to consistently generating financial value
for many components of society. This includes using environmentally beneficial
technologies of production, providing job opportunities to the disadvantaged sections
of the community and furnishing the primary facilities like crèches and schools to
employees.
 Personal Objectives: Establishments are made up of resources who possess different
backgrounds, experiences, objectives and personalities. They all become part of the
establishment to meet their several demands. These differ from economic necessities
such as ambitious perks and salaries, social obligations such as equal attention and
higher level demands such as individual growth and progress.

Functions of management
Management is defined as the procedure of organising, directing, planning and controlling the
efforts of organisational members and of managing organisational sources to accomplish
particular goals.

 Planning is the purpose of ascertaining in advance what is supposed to be done and

who has to do it. This signifies establishing goals in advance and promoting a way of
delivering them effectively and efficiently. In an establishment, the aim is the
obtainment and sale of conventional Indian handloom and workmanship articles.
They trade furnishings, readymades, household items and fabrics made out of
classical Indian textiles.
 Organising is the administrative operation of specifying grouping tasks, duties,
authorising power and designating resources needed to carry out a particular system.
Once a definite plan has been set for the completion of an organisational intent, the
organising party reviews the actions and resources expected to execute the program. It
ascertains what actions and resources are needed. It determines who will do a distinct
job, where and when it will be done.
 Staffing is obtaining the best resources for the right job. A significant perspective of
management is to make certain that the appropriate people with the apt skills are
obtainable in the proper places and times to achieve the goals of the company. This is
also called the human resource operations and it includes activities such as selection,
placement, recruitment and coaching of employees.
  Directing involves directing, leading and encouraging the employees to complete the
tasks allocated to them. This entails building an environment that inspires employees
to do their best. Motivation and leadership are 2 chief elements of direction. Directing
also includes communicating efficiently as well as managing employees at the
workplace. Motivating workers means simply building an atmosphere that urges them
to want to work. Leadership is inspiring others to do what the manager wants them to
do.
 Controlling is the management operation of controlling organisational achievement
towards the accomplishment of organisational intentions. The job of controlling
comprises ascertaining criteria of performance, computing the current performance,
comparing this with organised rules and taking remedial action where any divergence
is observed. Here management should ascertain what activities and outputs are
important to progress, how and where they can be regulated and who should have the
power to take remedial response

Levels of Management
There are 3 levels in the ranking order of an establishment and they are:

1. Top-level management
2. Middle-level management
3. Lower-level management

Let us discuss these management levels in detail in the following lines.

Top Level Management: They comprise of the senior-most executives of the company.
They are normally regarded as the Chairman, the Chief Executive Officer (CEO), the Chief
Operating Officer (COO), President and Vice-president (VP). Top management is a team
consisting of managers from various operational levels, managing marketing, finance, etc.,
For instance, Chief Finance Officer (CFO), Vice President (marketing) whose primary task is
to combine various components and regulate the actions of different units according to the
overall objectives of the company.
These top-level managers are accountable for the progress and continuation of the
establishment. They investigate the trading atmosphere and its connections for the survival of
the company. They form the overall organisational aims and approaches for their
accomplishment. They are held responsible for all the pursuits of the company and for its
influence on the society. The job of the top manager is difficult and stressful, necessitating
long hours and dedication to the company.
Middle Level Management: It is the connection between top and lower level managers.
They are lower to the top managers and above to the first line managers. They are normally
called as division heads, for instance, Production Manager. Middle management is
accountable for executing and regulating systems and manoeuvrings generated by the top
management.
At the same time, they are liable for all the actions of the first-line managers. Their principal
task is to bring out the plans formed by the top managers. For this purpose, they have to:

 Understand the procedures outlined by the top management

  Guarantee that their staff has the required workers
 Designate certain tasks and duties to them, and drive them to accomplish the aspired
objectives.
 Interact with other departments for the stable operation of the company. At the same
time, they are subject to all the actions of the first-line managers.

Lower Level Management: Managers and supervisors make up the lower level of the
management in the hierarchy of the business. Supervisors immediately manage the efforts of
the workforce. Their power and ability are defined according to the maps drawn by the top
management.
Supervisory management performs a significant task in the system since they coordinate with
the genuine workforce and move in directions of the middle management to the employees.
Through their efforts the worth of the output is reported, wastage of substances is reduced,
and security measures are affirmed.

Managerial roles - Mintzberg

Interpersonal Management Roles
The managerial roles in this category involve providing information and ideas.
1. Figurehead – As a manager, you have social, ceremonial and legal
responsibilities. You're expected to be a source of inspiration. People look up to
you as a person with authority, and as a figurehead.
2. Leader – This is where you provide leadership for your team, your department or
perhaps your entire organization; and it's where you manage the performance and
responsibilities of everyone in the group.
3. Liaison – Managers must communicate with internal and external contacts. You
need to be able to network effectively on behalf of your organization.
Informational Management Roles
The managerial roles in this category involve processing information.
1. Monitor – In this role, you regularly seek out information related to your organization
and industry, looking for relevant changes in the environment. You also monitor your
team, in terms of both their productivity, and their well-being.
2. Disseminator – This is where you communicate potentially useful information to
your colleagues and your team.
3. Spokesperson – Managers represent and speak for their organization. In this role,
you're responsible for transmitting information about your organization and its goals
to the people outside it

Decisional Management Roles

The managerial roles in this category involve using information.
1. Entrepreneur – As a manager, you create and control change within the
organization. This means solving problems, generating new ideas, and implementing
them.
2. Disturbance Handler – When an organization or team hits an unexpected roadblock,
it's the manager who must take charge. You also need to help mediate disputes within
it.
 3. Resource Allocator – You'll also need to determine where organizational resources
are best applied. This involves allocating funding, as well as assigning staff and other
organizational resources.
4. Negotiator – You may be needed to take part in, and direct, important negotiations
within your team, department, or organization.

Applying Mintzberg's Management Roles: You can use Mintzberg's 10 Management Roles
model as a frame of reference when you're thinking about developing your own skills and
knowledge. (This includes developing yourself in areas that you consciously or
unconsciously shy away from.) First, examine how much time you currently spend on each
managerial role. Do you spend most of your day leading? Managing conflict? Disseminating
information? This will help you decide which areas to work on first.

Management as an Art, Science and Profession

To decide whether management is science, art or profession, one has to comprehend the
characteristics and definitions of science, art and profession and associate them with
management definition and traits.
Management as an Art: Art is the experienced and personal utilisation of subsisting
information to accomplish solicited outcomes. It can be procured via education, research and
practice. As art is involved with the personal utilisation of data some kind of inventiveness
and creativity is needed to follow the fundamental systems acquired. The essential
characteristics of art are as follows:

 The presence of theoretical knowledge: Art assumes the presence of specific

academic knowledge. Specialists in their particular fields have obtained specific
elementary postulates which are appropriate to a specific sort of art. For instance, the
literature on public speaking, acting or music, dancing is publicly acknowledged.
 Personalised application: The application of this primary information differs from
person to person. Art, hence, is a highly personalised notion.
 Based on custom and creativity: Art is practical. Art includes the creative practice of
subsisting intellectual knowledge. We know that music is based on 7 notes. However,
what makes the style of a musician different or distinctive is his performance of these
notes in an artistic way that is uniquely his own solution.

Management as a Science: Science is an organised collection of knowledge that emphasises

definite universal truths or the action of comprehensive laws. The central characteristics of
science are as follows:

 The organised body of knowledge: Science is a precise entity of knowledge. Its

systems are based on a purpose and consequence association.
 Universal validity: Scientific conventions have global genuineness and application.
 Systems based on experimentation: Scientific conventions are originally formed via
research and then tested via repeated trial and error under the regulated situations.

Management as a Profession:The profession can be described as an occupation upheld by

specific education and practice, in which entry is limited. A profession has the following
features:
  The well-defined theory of knowledge: All services are based on a well-defined
form of education that can be procured through education.
 Restricted entry: The entrance to a profession is defined through an examination or
through obtaining an educational degree. For instance, to become a chartered
accountant in India an aspirant has to clear a detailed examination regulated by the
Institute of Chartered Accountants of India (ICAI).
 Professional community: All professions are affiliated to a professional association
which controls entry, presents a certificate of training and expresses and supports a
system of government. To be qualified to study in India, lawyers have to become
members of the Bar Council which monitors and regulates their actions

Conclusion : On the basis of above discussion, we have observed that the field of
management fulfills all features of art. Therefore, we can say, management is an art.

Meaning and Types of Business

Business is an economic activity that involves the exchange, purchase, sale or production of
goods and services with a motive to earn profits and satisfy the needs of customers.
Businesses can be both profit or non-profit organizations that function to gain profits or
achieve a social cause respectively.
Following are the characteristics or features of business
(1) An Economic Activity
(2) Manufacturing or Procurement of Services and Goods
(3) Exchange or Sale of Goods and Services for the Satisfaction of Human Needs
(4) Dealings With Goods and Services on a Daily Basis
(5) Profit Earning
(6) Uncertainty of Return
A business is defined as an organization or enterprising entity engaged in commercial,
industrial, or professional activities. Businesses can be for-profit entities or non-profit
organizations. Business types range from limited liability companies to sole proprietorships,
corporations, and partnerships.
The 7 types of business are as follows: Sole proprietorship, Partnership, Limited Liability
Partnership, Limited Partnership, Co-operative, Corporation and Non-profit organisation

Planning
Planning may be defined as deciding in advance what to be done in the future. It is the
process of thinking before doing. It involves the determination of goals as well as the
activities required to be undertaken to achieve the goals.

In the planning, process managers anticipate the future and accordingly decide what activities
must be undertaken. Planning deciding in advance – What to do, How to do, When, and by
whom.
“Planning means the determination of what is to be done, how it is to be done, who is to do it,
and how results are evaluated.”James Lundy

“Planning is deciding the best alternatives among others to perform different managerial
operation in order to achieve the predetermined goals.”Henry Feyol

Importance of Planning: Planning provides directions, reduces risks of uncertainty, reduces

overlapping and wasteful activities, promotes innovative ideas, facilitates decision making,
establishes standards for controlling.
Features of Planning: Planning focuses on achieving objectives; It is a primary function of
management; Planning is pervasive, continuous, futuristic and involves decision making; It is
a mental exercise.

Planning Process: As planning is an activity, there are certain reasonable measures for every
manager to follow:
(1) Setting Objectives

 This is the primary step in the process of planning which specifies the objective of an
organisation, i.e. what an organisation wants to achieve.
 The planning process begins with the setting of objectives.
 Objectives are end results which the management wants to achieve by its operations.
 Objectives are specific and are measurable in terms of units.
 Objectives are set for the organisation as a whole for all departments, and then
departments set their own objectives within the framework of organisational
objectives.
Example:
A mobile phone company sets the objective to sell 2,00,000 units next year, which is double
the current sales.
(2) Developing Planning Premises

 Planning is essentially focused on the future, and there are certain events which are
expected to affect the policy formation.
 Such events are external in nature and affect the planning adversely if ignored.
 Their understanding and fair assessment are necessary for effective planning.
 Such events are the assumptions on the basis of which plans are drawn and are known
as planning premises.
Example:The mobile phone company has set the objective of 2,00,000 units sale on the basis
of forecast done on the premises of favourable Government policies towards digitisation of
transactions.
(3) Identifying Alternative Courses of Action

 Once objectives are set, assumptions are made.

  Then the next step is to act upon them.
 There may be many ways to act and achieve objectives.
 All the alternative courses of action should be identified.
Example:The mobile company has many alternatives like reducing price, increasing
advertising and promotion, after sale service etc.
(4) Evaluating Alternative Course of Action

 In this step, the positive and negative aspects of each alternative need to be evaluated
in the light of objectives to be achieved.
 Every alternative is evaluated in terms of lower cost, lower risks, and higher returns,
within the planning premises and within the availability of capital.
Example:The mobile phone company will evaluate all the alternatives and check its pros
and cons.
(5) Selecting One Best Alternative

 The best plan, which is the most profitable plan and with minimum negative effects, is
adopted and implemented.
 In such cases, the manager’s experience and judgement play an important role in
selecting the best alternative.
Example:
Mobile phone company selects more T.V advertisements and online marketing with great
after sales service.
(6) Implementing the Plan

 This is the step where other managerial functions come into the picture.
 This step is concerned with “DOING WHAT IS REQUIRED”.
 In this step, managers communicate the plan to the employees clearly to help convert
the plans into action.
 This step involves allocating the resources, organising for labour and purchase of
machinery.
Example:Mobile phone company hires salesmen on a large scale, creates T.V advertisement,
starts online marketing activities and sets up service workshops.
(7) Follow Up Action

 Monitoring the plan constantly and taking feedback at regular intervals is called
follow-up.
 Monitoring of plans is very important to ensure that the plans are being implemented
according to the schedule.
 Regular checks and comparisons of the results with set standards are done to ensure
that objectives are achieved.
Types and Classification of Plans: Plans can be broadly classified as
a) Strategic plans
b) Tactical plans
c) Operational plans
Operational plans lead to the achievement of tactical plans, which in turn lead to the
attainment of strategic plans. In addition to these three types of plans, managers should also
develop a contingency plan in case their original plans fail.
a) Strategic plans: A strategic plan is an outline of steps designed with the goals of the entire
organization as a whole in mind, rather than with the goals of specific divisions or
departments. It is further classified as
 Mission: The mission is a statement that reflects the basic purpose and focus of the
organization which normally remain unchanged. The mission of the company is the
answer of the question : why does the organization exists? Properly crafted mission
statements serve as filters to separate what is important from what is not, clearly state
which markets will be served and how, and communicate a sense of intended
direction to the entire organization. Mission of Ford: “we are a global, diverse family
with a proud inheritance, providing exceptional products and services”.
 Objectives or goals: Both goal and objective can be defined as statements that reflect
the end towards which the organization is aiming to achieve. However, there are
significant differences between the two. A goal is an abstract and general umbrella
statement, under which specific objectives can be clustered. Objectives are statements
that describe—in precise, measurable, and obtainable terms which reflect the desired
organization’s outcomes.
 Strategies: Strategy is the determination of the basic long term objectives of an
organization and the adoption of action and collection of action and allocation of
resources necessary to achieve these goals.
Strategic planning begins with an organization's mission. Strategic plans look ahead over the
next two, three, five, or even more years to move the organization from where it currently is
to where it wants to be. Requiring multilevel involvement, these plans demand harmony
among all levels of management within the organization. Top-level management develops the
directional objectives for the entire organization, while lower levels of management develop
compatible objectives and plans to achieve them. Top management's strategic plan for the
entire organization becomes the framework and sets dimensions for the lower level planning.
b) Tactical plans: A tactical plan is concerned with what the lower level units within each
division must do, how they must do it, and who is in charge at each level. Tactics are the
means needed to activate a strategy and make it work. Tactical plans are concerned with
shorter time frames and narrower scopes than are strategic plans. These plans usually span
one year or less because they are considered short-term goals. Long-term goals, on the other
hand, can take several years or more to accomplish. Normally, it is the middle manager's
responsibility to take the broad strategic plan and identify specific tactical actions.
c) Operational plans: The specific results expected from departments, work groups, and
individuals are the operational goals. These goals are precise and measurable. “Process 150
sales applications each week” or “Publish 20 books this quarter” are examples of operational
goals. An operational plan is one that a manager uses to accomplish his or her job
responsibilities. Supervisors, team leaders, and facilitators develop operational plans to
support tactical plans Operational plans can be a single-use plan or a standing plan.
i) Single-use plans apply to activities that do not recur or repeat. A one-time occurrence,
such as a special sales program, is a single-use plan because it deals with the who, what,
where, how, and how much of an activity. ¬ Programme: Programme consists of an ordered
list of events to be followed to execute a project. ¬ Budget: A budget predicts sources and
amounts of income and how much they are used for a specific project.
ii) Standing plans are usually made once and retain their value over a period of years while
undergoing periodic revisions and updates. The following are examples of ongoing plans:
 Policy: A policy provides a broad guideline for managers to follow when dealing with
important areas of decision making. Policies are general statements that explain how a
manager should attempt to handle routine management responsibilities. Typical
human resources policies, for example, address such matters as employee hiring,
terminations, performance appraisals, pay increases, and discipline.
 Procedure: A procedure is a set of step-by-step directions that explains how activities
or tasks are to be carried out. Most organizations have procedures for purchasing
supplies and equipment, for example. This procedure usually begins with a supervisor
completing a purchasing requisition. The requisition is then sent to the next level of
management for approval. The approved requisition is forwarded to the purchasing
department. Depending on the amount of the request, the purchasing department may
place an order, or they may need to secure quotations and/or bids for several vendors
before placing the order. By defining the steps to be taken and the order in which they
are to be done, procedures provide a standardized way of responding to a repetitive
problem. ¬
 Rule: A rule is an explicit statement that tells an employee what he or she can and
cannot do. Rules are “do” and “don't” statements put into place to promote the safety
of employees and the uniform treatment and behavior of employees. For example,
rules about tardiness and absenteeism permit supervisors to make discipline decisions
rapidly and with a high degree of fairness.
d) Contingency plans: Intelligent and successful management depends upon a constant
pursuit of adaptation, flexibility, and mastery of changing conditions. Strong management
requires a “keeping all options open” approach at all times — that's where contingency
planning comes in. Contingency planning involves identifying alternative courses of action
that can be implemented if and when the original plan proves inadequate because of changing
circumstances. Keep in mind that events beyond a manager's control may cause even the
most carefully prepared alternative future scenarios to go awry. Unexpected problems and
events frequently occur. When they do, managers may need to change their plans.
Anticipating change during the planning process is best in case things don't go as expected.
Management can then develop alternatives to the existing plan and ready them for use when
and if circumstances make these alternatives appropriate

Management by objectives (MBO)

The term “management by objectives (MBO)” was first used by Peter F. Drucker in his 1954
book titled The Practice of Management. MBO is a process through which specific goals are
set collaboratively for the organization as a whole and every unit and individual within it. It is
a process in which a manager and an employee agree on specific performance goals and then
develop a plan to reach them. It is designed to align objectives throughout an organization
and boost employee participation and commitment.
MBO outlines five steps that organizations should use to put the management technique into
practice.
1. Define organizational objectives.
2. Translate objectives to team members
3. Monitor performance.
4. Evaluate progress.
5. Reward achievements.
Advantages of Management By Objective(MBO): Better Utilization of Resources, Aid in
Planning, Better Team work, Concentration on Key Result Areas, Objective Evaluation,
Result orientation and Sound Organizational Structure

How is MBO is different from MBE

Management by objectives (MBO) is a systematic and organized approach that aims to
increase organizational performance. In other hand. Management by Exception (MBE) is a
"policy by which management devotes its time to investigating only those situations in which
actual results differ significantly from planned results.

What is Management by Exception?

Management by exception (MBE) is a practice where only significant deviations from a
budget or plan are brought to the attention of management. The idea behind it is that
management's attention will be focused only on those areas in need of action. When they are
notified of variance, managers can hone in on that specific issue and let staff handle
everything else. If nothing is brought up, then management can assume everything is going
according to plan.
Process of Management By Exception(MBE)

1. Identifying and Specifying Key Result Areas(K.R.A.s)

2. Setting Standards and outlining permissible deviations, especially for K.R.A.'s
3. Comparing actual results with the Standards
4. Computing and analyzing deviations
5. Strategizing and taking corrective actions

Advantages of Management By Exception(MBE): Time Saving, Concentration, Wider

Span, Effective Decision Making, Data Base Management, Fuller Utilization of Talent,
Identify Critical Problems and Facilitates Judgement.

What Is Corporate Planning?

Corporate planning is a process that is used by businesses to map out a course of action to
grow, increase profits, gain exposure, or strengthen brand identity. Corporate planning is a
tool that successful business use to leverage their resources more wisely than their
competitors.
Six Key Elements of a Successful Corporate Plan
As a business, you must take many factors into consideration before you begin planning a
business strategy. You must take a step outside of your position in the business and look at
the following elements as if you were a competitor or a consumer. To create a successful
corporate plan, you will need to
1. Gather Information
2. Set objectives of the plan
3. Devise strategies to meet goals
4. Implement your plan
5. Monitor plan performance
6. Evaluate the effectiveness/success of your plan
Process or Stages of formulating strategy: Environment Analyses, Strategic Planning,
Strategic Implementation and Strategic Control and evaluation
Levels of Strategy: Corporate Level, Business Level, Functional Level and Operational
Level
Environment Diagnosis
Environment diagnosis is an exercise attempted to identify the factors of causes in the
environment that affect the function of an organisation and use such identification as a base
for developing plans or strategic to improve or maximize the dynamism and effectiveness of
the organisation. Environment analysis is a tool of environmental diagnosis.

Environmental Diagnosis Analysis and Diagnosis

The purpose of environment analysis and diagnosis is to identify the ways in which changes
in various organizational factors may directly and indirectly influence the organisation and
management. Managers commonly perform environment analysis in order to understand
different activities and happenings inside and outside their organisation and thereby increase
the chances of framing sound and effective organisations and managerial strategies by coping
with the probable demands of the environment.

Environmental analysis is required due to its needs and importance for the following reasons:
1. Environmental factors are primary impact makers on corporate strategy of organisations.
2. Such analysis helps in anticipating opportunities and to plan alternative responses to those
opportunities.
3. It helps in determining threats and developing an early warning system to prevent threats to
the organisation or to determine the risks that may be faced by organisation in its future
operations.
4. It helps to identify those adjustments or adaptations, which are required for greater
accomplishment of organizational objectives.
5. It is sort of SWOT (Strengths, Weaknesses, Opportunities and Threats) analysis which
helps in deciding about the rights course of action for managerial to successfully negotiate
with the prevalent circumstances around the organisation in order to ensure its survival,
growth and development.
6. Environmental information strengthens the planning process and strategy formulation
Meaning of Forecasting:
Forecasting is the process of estimating the relevant events of future, based on the analysis of
their past and present behaviour.

Thus, forecasting may be defined as the process of assessing the future normally using
calculations and projections that take account of the past performance, current trends, and
anticipated changes in the foreseeable period ahead.

Whenever the managers plan business operations and organisational set-up for the years
ahead, they have to take into account the past, the present and the prevailing economic,
political and social conditions. Forecasting provides a logical basis for determining in
advance the nature of future business operations and the basis for managerial decisions about
the material, personnel and other requirements.

On the basis of the definition, the following features of forecasting can be identified:
1. Forecasting relates to future events.
2. Forecasting is needed for planning process because it devises the future course of action.
3. It defines the probability of happening of future events. Therefore, the happening of future
events can be precise only to a certain extent.
4. Forecasting is made by analysing the past and present factors which are relevant for the
functioning of an organisation.
5. The analysis of various factors may require the use of statistical and mathematical tools
and techniques.

Steps in Forecasting:
The process of forecasting generally involves the following steps:
 Developing the Basis:The future estimates of various business operations will have to
be based on the results obtainable through systematic investigation of the economy,
products and industry.
 Estimation of Future Operations: On the basis of the data collected through
systematic investigation into the economy and industry situation, the manager has to
prepare quantitative estimates of the future scale of business operations. Here the
managers will have to take into account the planning premises.
 Regulation of Forecasts: It has already been indicated that the managers cannot take
it easy after they have formulated a business forecast. They have to constantly
compare the actual operations with the forecasts prepared in order to find out the
reasons for any deviations from forecasts. This helps in making more realistic
forecasts for future
 Review of the Forecasting Process: Having determined the deviations of the actual
performances from the positions forecast by the managers, it will be necessary to
examine the procedures adopted for the purpose so that improvements can be made in
the method of forecasting
 Techniques of Forecasting: There are various methods of forecasting. However, no
method can be suggested as universally applicable. In fact, most of the forecasts are
done by combining various methods.
A brief discussion of the major forecasting methods is given below:
 Historical Analogy Method: Under this method, forecast in regard to a particular
situation is based on some analogous conditions elsewhere in the past. The economic
situation of a country can be predicted by making comparison with the advanced
countries at a particular stage through which the country is presently passing.
Likewise, changes in the norms of business behaviour in terms of attitude of the
workers against inequality, find similarities in various countries at various stages of
the history of industrial growth. Thus, this method gives a broad indication about the
future events of general nature.
 Survey Method: Surveys can be conducted to gather information on the intentions of
the concerned people. For example, information may be collected through surveys
about the probable expenditure of consumers on various items. Both quantitative and
qualitative information may be collected by this method.On the basis of such surveys,
demand for various products can be projected. Survey method is suitable for
forecasting demand—both of existing and new products. To limit the cost and time,
the survey may be restricted to a sample from the prospective consumers.
 Opinion Poll: Opinion poll is conducted to assess the opinion of the experienced
persons and experts in the particular field whose views carry a lot of weight. For
example, an opinion poll of the sales representatives, wholesalers or marketing
experts may be helpful in formulating demand projections.
 Business Barometers: A barometer is used to measure the atmospheric pressure. In
the same way, index numbers are used to measure the state of an economy between
two or more periods. These index numbers are the device to study the trends, seasonal
fluctuations, cyclical movements, and irregular fluctuations. These index numbers,
when used in combination with one another, provide indications as to the direction in
which the economy is proceeding. Thus, with the business activity index numbers, it
becomes easy to forecast the future course of action
 Time Series Analysis: Time series analysis involves decomposition of historical
series into its various components, viz. trend, seasonal variances, cyclical variations,
and random variances. When the various components of a time series are separated,
the variation of a particular situation, the subject under study, can be known over the
period of time and projection can be made about the future. A trend can be known
over the period of time which may be true for the future also. However, time series
analysis should be used as a basis for forecasting when data are available for a long
period of time and tendencies disclosed by the trend and seasonal factors are fairly
clear and stable.
 Regression Analysis: Regression analysis is meant to disclose the relative
movements of two or more inter-related series. It is used to estimate the changes in
one variable as a result of specified changes in other variable or variables. In
economic and business situations, a number of factors affect a business activity
simultaneouslyRegression analysis helps in isolating the effects of such factors to a
great extent. For example, if we know that there is a positive relationship between
advertising expenditure and volume of sales or between sales and profit, it is possible
to have estimate of the sales on the basis of advertising, or of the profit on the basis of
projected sales, provided other things remain the same.
 Input-Output Analysis: According to this method, a forecast of output is based on
given input if relationship between input and output is known. Similarly, input
requirement can be forecast on the basis of final output with a given input-output
relationship. The basis of this technique is that the various sectors of economy are
interrelated and such inter-relationships are well-established. For example, coal
requirement of the country can be predicted on the basis of its usage rate in various
 sectors like industry, transport, household, etc. and how the various sectors behave in
future. This technique yields sector-wise forecasts and is extensively used in
forecasting business events as the data required for its application are easily obtained.

Decision making
Decision making may be reviewed as the process of selecting a course of action from
among several alternatives in order to accomplish a desired result. The purpose of decision
making is to direct human behaviour and commitment towards a future goal. A decision is a
course of action consciously selected from available alternatives, with a view to
achieving a desired goal. It is an outcome of the judgement and represents a choice and
commitment to the same. It is a final resolution of a conflict of needs, means or goals made
are the face of uncertainty, complexity and multiplicity. A decision is conclusion
reached after consideration it occurs when one option is selected to the exclusion of others –
it is rendering of judgement. Different management scholars have defined Decision making
as follows:
 George Terry - Decision making is the selection based on some criteria from two or
more alternatives.
 Heinz Weihrick and Harold Koontz - Decision making is defined as the selection of
a course of action among alternatives, it is the care of planning.
 Louis Allen - Decision making is the work a manager performs to arrive at
conclusion and judgement.
 Decision making is a five step process: recognition of a situation that requires a
decision; identification and development of alternative courses of action; evaluation
of the alternatives; choice of one of the alternatives, and implementation of the
selected course of action.
 Quantitative decisions are mostly based on statistical analysis of collected data
whereas qualitative decisions are based on many algorithms like type and quality of
data, factors that influence collected data, risk assessments etc. It is a more in-depth
evaluation of information taking into account all possible factors that affect a given
scenario not just the numerical data value to reach a decision.
 Quantitative factors are numerical basis for decision making; effect of decision on
stakeholders and their response; investment appraisal; break-even analysis; market
research; sales forecasting; critical path analysis an decision trees. Qualitative factors
take into account other issues that may influence outcome of a decision like SWOT
analysis (Strength Weakness Opportunities Threats); Human Resource Management
issues like motivation, morale, retention etc; PEST (Political Economic Social
Technological); Publicity and public image; long term survival/development issues
and stakeholder analysis.

In conclusion, quantitative decision is based on clear numerical statistical and quantifiable

data without consideration to any other factors. Qualitative decision is more subjective not
just based on the numerical statistical data but other associated factors that may have some or
major influence on the collected data. It is a more in-depth analysis of all possible factors that
can affect the decision making process.
Importance of decision‐making are: Implementation of managerial function, Pervasiveness
of decision‐making, Evaluation of managerial performance, Helpful in planning and policies ,
Selecting the best alternatives and Successful; operation of business

Delegation and Principles of delegation:ts

Delegation is the transfer of responsibility which is less important and can be performed by
the subordinates. This also brings a sense of responsibility to the work done by the
subordinates and paves the way for growth of the subordinates.
The process of delegation enables a person to assign work task to his subordinate and give
them necessary authority to accomplish it successfully. It helps in completing the work in
time, reduces the workload of managers and motivates and develops subordinates.

In other words, delegation is a process that enables a person to assign a work to others and
delegate them with adequate authority to do it.

Koontz and O’ Donnell state that, “The entire process of delegation involves the
determination of results expected, the assignment of tasks, the delegation of authority for
accomplishment of these tasks and the exaction of responsibility for their accomplishment.”

Delegation of authority refers to the transfer of authority from the level of supervisor to the
level of subordinates. In other words, delegation is the downward transfer of authority from
the manager to the subordinate.
Delegation of authority is important as the superior in an organisation is not able to manage
all the work by himself. Delegation of authority helps the managers to focus on more
important functions of the organisation that need to be taken care of on priority.

Elements of Delegation
 Authority: One of the essential elements of delegation is authority which is the
power to complete an assigned task. Without authority a subordinate is unable to
execute the task perfectly. In order to complete the task as is expected by the
manager, the manager has to provide authority of executing that task to the
subordinate.
 Responsibility: Responsibility is another element of delegation which is assigning the
subordinate a task that needs to be executed. When the superior assigns any task to the
subordinate it becomes the obligation of the subordinate to perform that task with
responsibility. The feeling of responsibility arises from the superior subordinate
relationship where a subordinate is obliged to perform the job as assigned by the
superior.
 Accountability: Accountability element of delegation refers to the answerability of a
subordinate to his superior for the job or task that is assigned. Accountability flows in
an upward direction, which means the subordinate is accountable to the superior.
Although the subordinate is accountable to the superior, the actual accountability of that task
and its outcome rests with the superior as accountability is not transferred to the subordinate,
it is just imposed till the time the task is completed.

Delegation can take three forms:

1. Top to Bottom Delegation:
The process of delegation where superiors delegate workload to subordinates is top to bottom
delegation.
2. Bottom to Top Delegation:
This form of delegation recognises the importance of informal groups in the formal
organisation structures. The force of attraction of group members is so strong that if they
have to obey the superior or group members, they may choose the latter. Managers have to be
careful in issuing orders/directions to subordinates to carry out the delegated tasks.
They should motivate subordinates as members of the group and not individual members.
According to Allen, “to the extent that the manager convinces the members of the group that
their needs, his own, and those of the company coincide, he can motivate them to produce
according to the standards he sets.”
3. Lateral Delegation:
When managers delegate authority to subordinates in the hierarchy, subordinates further
delegate the tasks informally to people at the same level in other units. For example, if
general manager of sales department asks sales manager to compile the figures of sales and
sales personnel for the month of January, the sales manager will seek the assistance of
finance manager and personnel manager. Thus, authority and responsibility delegated to sales
manager is shared by him with managers of other departments working at the same level.
This is a form of lateral delegation. Peer groups in this case come together and carry out the
task as a team

Principles and Process of Delegation

Step # 1. Determine the Goals: The first step of delegation is to establish the goal or
objective of the position/post so that the person determines the need for delegation. If
delegation is initiated in the sales department, the objective should be made clear; sales
promotion or sales retention.
Step # 2. Define Responsibility: Once requirement of the job is defined, responsibility of
different individuals is determined in terms of tasks assigned to them. This helps them to
know their bosses and subordinates to whom they can issue instructions.
Step # 3. Define Authority: The job having been assigned, authority is given so that people
can discharge responsibilities related to that job.
Step # 4. Motivate Subordinates: The duty of manager does not end by delegating authority
and responsibilities to subordinates. He makes sure that subordinates willingly contribute to
the job assigned so that organisational goals can be optimally achieved. Managers motivate
the subordinates to work with zeal and enthusiasm. They use financial and non-financial
(participative decision-making, recognition etc.) incentives to motivate the subordinates.
Step # 5. Hold Accountability: Whatever the nature and extent of delegation, managers
continuously monitor the activities of subordinates to review their progress and provide
guidance, whenever necessary. They hold them accountable for the work assigned but remain
ultimately accountable to their superiors for successful completion of the task and its
coordination with the overall organisational work.
Step # 6. Train Subordinates: Despite the authority commensurate with responsibility,
subordinates may not be able to effectively carry out the delegated tasks. Managers,
therefore, organise training programmes to enhance their knowledge on the tasks assigned.
Step # 7. Establish Control: Specific standards of performance are framed so that
subordinates can assess their performance against standards, control their activities and
coordinate them with goals of the organisation.

Principles of delegation: Some principles of effective delegation for managers are Defining
the Function, Defining the Results, Balance of Authority with Responsibility, Absoluteness
of Responsibility, Unity of Command, Defining the Limits of Authority.

UNIT 3 - ORGANIZING AND STAFFING

Organizing: Nature and Purpose of Organization – Principles of Organization – Organization

structure and types – Departmentalization – Committees – Centralization vs. Decentralization
of Authority – Span of Control – Meaning - Factors affecting span. Staffing: Meaning, Nature
and Process of Staffing

Committees

A committee may be assigned some managerial functions or some advisory or exploratory

service may be expected from it. A committee is not a separated type of organisation as such.
But it is a method of attaching persons or groups to line departments for advice and guidance
in business planning and execution. A group of competent and interested persons pool their
thoughts for facilitating decision making process.

The committees are set up for the following reasons:

 The committees provide a forum for exchanging ideas among organisational

members.
 The exchange of ideas among members may generate some suggestions and
recommendations which may be useful for the organisation.
 There can be proper discussion on present problems and efforts are made to find
solutions.
 The committees may also be needed in establishing and developing organisational
policies.

There may be following types of committees:

Formal and Informal Committees: If a committee is formed as a part of organisation

structure and is delegated some duties and authority, it is a formal committee. An informal
committee may be formed to tackle some problem. A manager may call some experts to help
him in analyzing a problem and suggesting a suitable solution.

Advisory Committees:These are the committees to advice line heads on certain issues. Line
officers may refer some problems or issues to a committee for advice. The committee will
collect information about the problem and recommend solution for the same. The line officers
have the powers to accept, modify or reject the suggestions of advisory committees. These
committees have no managerial powers and cannot exert their views on the line executives

Line Committees:There may be committees with managerial powers. Instead of giving a

work to one person it may be assigned to a number of executives. The committees having
administrative powers are called line or plural committees. Line committees help in planning
company policies and programmes and organizing efforts at fulfillment of these plans, etc.
These committees also direct and control the activities of employees for achieving
organisational goals.

Advantages of Committee Form of Organisation:The committee form of organisation has

the following advantages: Pooling of Opinions, Better Co-Ordination, Balancing of Views,
Motivation, Dispersion of Power, Better Acceptance of Decisions, Better Communication
and Executive Training

Span Of Control:

The term ‘span of control’ is also known as ‘span of supervision’ or ‘span of authority’.
Simply stated it refers to the number of individuals a manager can effectively supervise.
Thus, it is expected that the span of control, that is, the number of subordinates directly
reporting to a superior should be optimised so as to make supervision and control effective.
This is because executives have limited time and ability

Factors affecting Span of Control

1. Nature of the work: If the work is simple and repetitive, the span of control can be wider.
However, if the work requires close supervision the span of control must be narrow.

2. Ability of the manager: Some managers are more capable of supervising large numbers of
people than others. Thus, for a manager who possesses qualities of leadership, decision-
making ability, and communication skill in greater degree the span of control may be wider.

3. Efficiency of the organisation: Organisations with efficient working systems and

competent personnel can have larger span of control.

4. Staff assistants: When staff assistants are employed, contact between Organising
supervisors and subordinates can be reduced and the span broadened.

5. Time available for supervision: The span of control should be narrowed at higher levels
because top managers have less time available for supervision. They have to devote the major
part of their work time in planning, organising, directing and controlling.

6. Ability of the subordinates: Fresh entrants to jobs take more of a supervisor’s time than
trained persons who have acquired experience in the job. Subordinates who have good
judgement, initiative, and a sense of obligation seek less guidance from the supervisor.

7. Degree of decentralisation: An executive who personally takes many decisions is able

to supervise fewer people than an executive who merely provides encouragement and
occasional direction.
Staffing

Staffing is the managerial function of recruitment, selection, training, developing, promotion

and compensation of personnel. Staffing may be defined as the process of hiring and
developing the required personnel to fill in the various positions in the organization.

The term ‘Staffing’ relates to the recruitment, selection, development, training and
compensation of the managerial personnel.

“The managerial function of staffing involves manning the organisational structure through
effective and proper selection, appraisal, and development of personnel to fill the roles
designed into the structure.” — Koontz and O’Donnell

Importance of Staffing:

It is of utmost importance for the organisation that right kinds of people are employed. They
should be given adequate training so that wastage is minimum. They must also be induced to
show higher productivity and quality by offering them incentives.

1. Efficient Performance of Other Functions:

2. Effective Use of Technology and Other Resources:

3. Optimum Utilisation of Human Resources:

4. Development of Human Capital:

5. Motivation of Human Resources:

6. Building Higher Morale:

The following features explain the nature of staffing:

1. Management function:

2. Pervasive function:

3. Part of human resource management:

4. Deals with active resource:

5. Attached with personnel department:

6. Continuous function:

Staffing process consists of the following steps:

1. Manpower Planning
2. Recruitment
3. Selection
4. Placement
5. Training
6. Development
7. Promotion
8. Transfer
9. Appraisal
10. Determination of Remuneration
We will be discussing all these steps in detail in the following lines.
Manpower Planning: Manpower planning is the quantitative and qualitative measurement of
the manpower that is required in an organisation. It involves evaluation and creation of the
manpower inventory and also to develop the necessary talents among the employees that are
selected for obtaining promotion.
Recruitment: Recruitment is the process of finding the potential employees of an
organisation and persuading them to apply for the available positions in the organisation. If
the recruitment process is followed scientifically, then it will result in better wages, high
morale and higher productivity among the employees.
Selection: Selection is the process of shortlisting of potential candidates and eliminating the
candidates that are not suitable for the positions available in the organisation. The purpose of
selection is to hire the right candidate for the right position, which will lead to efficient
running of operations for the organisation.
Job Offer: The Company provides an appointment letter, which contains the terms and
conditions of the Organisation. The employee is accepted to the organisation, only if he
agrees to the terms and conditions of the company.
Placement: Placement refers to the process of introducing an employee to the job for which
he was hired in the organisation (Induction). The employee will be provided with a basic
orientation about the company and its work areas.
Training: Training is the process of providing the newly recruited employees an idea about
the type of work that they are going to do and how to do that. This falls under the training
department.
Training is an essential part of hiring as it helps keep the employees updated on the way of
work in an organisation. Also due to advances in technology, newer technologies will evolve,
that makes it necessary for employees to be updated with the latest development.
Development: Development refers to the opportunity of growth of the employees in the
organisation. The organisation must provide ample opportunities for the development of the
employees, without which the employees may become frustrated.
Promotion: Promotion is referred to as the process of giving the employees a raise in salary,
designation or both. The raise in designation is associated with a raise in wages or bonus or
incentives. There can be some instances where the change in designation does not result in
increase in pay.
Transfer: Transfer is the process of shifting of an employee from one position to another in
the organisation without any monetary benefit, or any increase in the responsibilities. This
function needs to be evaluated from time to time.
Appraisal: Appraisal is the process of checking the progress of the work done by the
subordinates. It also studies human behaviour and also the attitude and aptitude of the
employee towards performing the job.
Determination of Remuneration: The remuneration of an employee is very important for
sustenance. It is regarded as one of the difficult functions to perform as there exists no tools
which can accurately determine wages.

Benefits of Staffing Process

Following are some of the benefits of the staffing processes:
1. It helps in getting the right person for the right position in an organization.
2. It helps in improving the organisational productivity as proper selection process, increases
the quality of employees, which coupled with training results in better productivity.
3. It keeps employee morale high and also provides them job satisfaction.
4. It helps in maintaining a harmonious working environment inside the organisation.

Difference Between Centralization and Decentralization

Centralization and Decentralization are the two types of structures, that can be found in
the organization, government, management and even in purchasing.

Centralization of authority means the power of planning and decision making are
exclusively in the hands of top management. It alludes to the concentration of all the powers
at the apex level.

On the other hand, Decentralization refers to the dissemination of powers by the top
management to the middle or low-level management. It is the delegation of authority, at all
the levels of management.

To determine whether an organization is centralized or decentralized greatly depends on the

location of decision-making authority and the degree of decision-making power at lower
levels.

BASIS FOR
CENTRALIZATION DECENTRALIZATION
COMPARISON

Meaning The retention of powers and The dissemination of authority,

authority with respect to responsibility and accountability to
planning and decisions, with the the various management levels, is
top management, is known as known as Decentralization.
Centralization.

Involves Systematic and consistent Systematic dispersal of authority.

reservation of authority.

Communication Vertical Open and Free

Flow

Decision Making Slow Comparatively faster

Advantage Proper coordination and Sharing of burden and responsibility

Leadership

Power of decision Lies with the top management. Multiple persons have the power of
making decision making.

Implemented when Inadequate control over the Considerable control over the
organization organization

Best suited for Small sized organization Large sized organization

What is Organisation

Organisation refers to a collection of people who are working towards a common goal and
objective. In other words, it can be said that organisation is a place where people assemble
together and perform different sets of duties and responsibilities towards fulfilling the
organisational goals.
Types of Organisation and their Structure
There are two broad categories of organisation, which are:
1. Formal Organisation
2. Informal Organisation
Formal Organisation: Formal organisation is that type of organisation structure where the
authority and responsibility are clearly defined. The organisation structure has a defined
delegation of authority and roles and responsibilities for the members.
The formal organisation has predefined policies, rules, schedules, procedures and programs.
The decision making activity in a formal organisation is mostly based on predefined policies.
Formal organisation structure is created by the management with the objective of attaining
the organisational goals.
There are several types of formal organisation based on their structure, which are discussed
as follows:
1. Line Organisation
2. Line and Staff Organisation
3. Functional Organisation
4. Project Organisation
5. Matrix Organisation
Let us learn about these organisation structures in detail in the following lines.
Line Organisation: Line organisation is the simplest organisation structure and it also
happens to be the oldest organisation structure. It is also known as Scalar or military or
departmental type of organisation.
In this type of organisational structure, the authority is well defined and it flows vertically
from the top to the hierarchy level to the managerial level and subordinates at the bottom and
continues further to the workers till the end.
There is a clear division of accountability, authority and responsibility in the line organisation
structure.
Advantages of Line organisation
1. Simple structure and easy to run
2. Instructions and hierarchy clearly defined
3. Rapid decision making
4. Responsibility fixed at each level of the organisation.
Disadvantages of Line organisation:
1. It is rigid in nature
2. It has a tendency to become dictatorial.
3. Each department will be busy with their work instead of focusing on the overall
development of the organisation.
Line and Staff Organisation: Line and staff organisation is an improved version of the line
organisation. In line and staff organisation, the functional specialists are added in line. The
staff is for assisting the line members in achieving the target effectively.
Advantages of Line and Staff organisation
1. Easy decision making as work is divided.
2. Greater coordination between line and staff workers.
3. Provides workers the opportunity for growth.
Disadvantages of Line and Staff Organisation
1. Conflict may arise between line and staff members due to the improper distribution of
authority.
2. Staff members provide suggestions to the line members and decision is taken by line
members, it makes the staff members feel ignored.
Functional Organisation: Functional organisation structure is the type of organisation where
the task of managing and directing the employees is arranged as per the function they
specialise. In a functional organisation, there are three types of members, line members, staff
members and functional members.
Advantages of Functional organisation
1. Manager has to perform a limited number of tasks which improves the accuracy of the
work.
2. Improvement in product quality due to involvement of specialists.
Disadvantages of Functional organisation
1. It is difficult to achieve coordination among workers as there is no one to manage them
directly.
2. Conflicts may arise due to the members having equal positions.
Project Organisation: A project organisation is a temporary form of organisation structure
that is formed to manage projects for a specific period of time. This form of organisation has
specialists from different departments who are brought together for developing a new
product.
Advantages of Project organisation
1. The presence of many specialists from different departments increases the coordination
among the members.
2. Each individual has a different set of responsibilities which improves control of the
process.
Disadvantages of Project Organization
1. There can be a delay in completion of the project.
2. Project managers may find it difficult to judge the performance of different specialists.
Matrix Organisation: Matrix organisation is the latest form of organisation that is a
combination of functional and project organisation. In such organisations there are two lines
of authority, the functional part of the organisation and project management part of the
organisation and they have vertical and horizontal flow of authority, respectively.
Advantages of Matrix Organisation
1. Since the matrix organisation is a combination of functional and project management
teams, there is an improved coordination between the vertical and horizontal functions.
2. Employees are motivated as everyone will be working towards one project.
Disadvantages of Matrix Organisation
1. Due to the presence of vertical and horizontal communication, there will be increased cost
and paperwork.
2.Having multiple supervisors for the workers leads to confusion and difficulty in control.
Informal Organisation: Informal organisations are those types of organisations which do
not have a defined hierarchy of authority and responsibility. In such organisations, the
relationship between employees is formed based on common interests, preferences and
prejudices.

Principles of Organisation – 14 Principles

1. Principle of Objective: An organisation and every part of it should be directed towards

the accomplishment of basic objectives. Every member of the organisation should be well
familiar with its goals and objectives. Common objectives create commonness of interests.

2. Principle of Division of Work: The total task should be divided in such a manner that the
work of every individual in the organisation is limited as far as possible to the performance of
a single leading function. The activities of the enterprise should be so divided and grouped as
to achieve specialisation.

3. Principle of Unity of Command: Each person should receive orders from only one
superior and be accountable to him. This is necessary to avoid the problems of conflict in
instructions, frustration, uncertainty and divided loyalty and to ensure the feeling of personal
responsibility for results. This principle promotes co-ordination but may operate against the
principle of specialisation.

4. Principle of Span of Control:No executive should be required to supervise more

subordinates than he can effectively manage on account of the limitation of time and ability.
There is a limit on the number of subordinates that an executive can effectively supervise.
However, the exact number of subordinates will vary from person to person depending upon
the nature of job, and basic factors that influence the frequency and severity of the
relationships to be supervised.

5. Principle of Scalar Chain:Authority and responsibility should be in a clear unbroken line

from the highest executive to the lowest executive. As far as possible, the chain of command
should be short. The more clear the line of authority from the ultimate authority in an
enterprise to every subordinate position, the more effective will be decision-making and
organisation communication.

6. Principle of Delegation:Authority delegated to an individual manager should be adequate

to enable him to accomplish results expected of him. Authority should be delegated to the
lowest possible level consistent with necessary control so that co-ordination and decision-
making can take place as close as possible to the point of action.

7. Principle of Absoluteness of Responsibility:The responsibility of the subordinate to his

superior is absolute. No executive can escape responsibility for the delegation of authority to
his subordinates.

8. Principle of Parity of Authority and Responsibility:Authority and responsibility must

be co-extensive. The responsibility expected for a position should be commensurate with the
authority delegated to that position, and vice-versa. In addition, authority and responsibility
should be clearly defined for all positions.

9. Principle of Co-Ordination:There should be an orderly arrangement of group efforts and

utility of action in the pursuit of a common purpose. This would help in securing unity of
effort.

10. Principle of Flexibility:The organisation must permit growth and expansion without
dislocation of operations. Devices, techniques and environmental factors should be built into
the structure to permit quick and easy adaptation of the enterprise to changes in its
environment. Good organisation is not a straight jacket.

11. Principle of Efficiency:An organisation is efficient if it is able to accomplish

predetermined objectives at minimum possible cost. An organisation should provide
maximum possible satisfaction to it members and should contribute to the welfare of the
community. The principle of efficiency should be applied judiciously.

12. Principle of Continuity:The organisation should be so structured as to have continuity of

operations. Arrangements must be made to enable people to gain experience in positions of
increasing diversity and responsibility.

13. Principle of Balance:The various parts of the organisation should be kept in balance and
none of the functions should be given undue emphasis at the cost of others. In order to create
structural balance, it is essential to maintain a balance between centralisation and
decentralisation, between line and staff, etc. Vertical and horizontal dimensions must be kept
in reasonable balance by ensuring that the structure is neither too tall nor too flat.

14. Principle of Exception:Every manager should take all decisions within the scope of his
authority and only matters beyond the scope of his authority should be referred to higher
levels of management. In other words, routine decisions should be taken at lower levels and
top management should concentrate on matters of exceptional importance.

What is departmentalization?

Departmentalization is an organizational structure that separates people into groups, or

departments, based on a particular set of criteria. These departments have their own
leadership and work together to complete tasks. With large or complicated projects, multiple
departments may work together.

Here are the primary objectives of businesses that choose to implement departmentalization:

 Maintaining control
 Simplifying operational processes
 Grouping specialized activities together
 Increasing overall efficiency
 Ensuring responsibility and accountability

Types of departmentalization

Here are the common types of departmentalization:

Function:Organizations that form departments by function separate employees based on the

type or subject of work they perform. This allows professionals with similar areas of
expertise to communicate and collaborate with each other. Three common types of function
departments are production, marketing and finance.

Process: Process departmentalization groups people by where in the production process their
work usually occurs. For example, a toy company may have a department for ordering the
raw materials, one for building toys and a third department for transporting them. Process
departmentalization is common among production companies.

Product:Some companies with more than one product may sort their departments by the item
that teams work on. For example, an ice cream company may have separate departments for
their popsicles, ice cream sandwiches and take-home ice cream cartons. Larger companies
often have more products, so they're more likely to use this type of departmentalization.

Market: Market departmentalization is when an organization forms its departments based on

what market it's targeting. Markets are large groups of customers that may have unique
needs. For example, a life insurance company may have departments for insuring large
companies, nonprofit organizations and individuals.

Customer:If a company has a particular customer that gives them a lot of business, they can
create a department specifically for that customer. For example, if a canned beans production
company sells to five major grocery stores, they may have a department for each store. This
is a common type of organizational structure for contracting and some production companies.

Location: Location departmentalization creates groups based on a general geographical area.

This area can either be the location of the company or of their clients. For example, a
telemarketing company can make departments depending on which state their telemarketers
target

UNIT 4 LEADERSHIP, MOTIVATION AND DIRECTING

Motivating and Leading People at work: Leadership: Concept and leadership styles:
Leadership theories, Trait theory, Rensis Likert Management theory, situational
contingency theory; Motivation: Concept, Theories - Maslow, Herzberg, McGregor,
Ouchi, Vroom’s expectancy theory. Financial and non-financial incentives. Directing:
Meaning – Principles and techniques of directing

Motivating and Leading People at work

A motivational leader inspires their team with enthusiasm and passion. They make people
feel valued by investing time and learning about their priorities, strengths and needs. A
motivated leader recognizes the value of hard work and encourages their employees' potential
through meaningful challenges and goals.

Leadership
Leader is one who has an ability, attitude and skills to influence the members of
organisation across all levels to achieve the desired outcomes as per expected qualitative
and quantitative standards
“True leadership is the ability to influence people to achieve a better result for an
organization or group,” says career coach Kathleen Brady. In the workplace, a leader’s
influence can be reflected in employee happiness, a healthy bottom line, a culture of
innovation, positive social change, and more. For example, data shows that 70% of workforce
engagement, defined as the level of commitment and connection an employee has with their
workplace, is influenced by managers
Leadership Styles
1. Autocratic: An autocratic leader has absolute authority and control who dictates
policies and procedures of a business without obtaining any meaningful participation
from his/her subordinates.
2. Democratic: A democratic leader encourages participation, relies on subordinates'
knowledge and expertise for the completion of tasks and depends on subordination
respect for influence.
3. Laissez-faire: Laissez-faire literally means "let them do", which further implies the
intervention of any authority or guide or leader.
4. Bureaucratic: Bureaucratic leadership can be defined as a system of management
that follows a hierarchy where official duties are fixed. Employees in this form of
 leadership are expected to follow specific rules and authority created by their
superiors.
5. Transformational: Transformational leadership is a theory of leadership where a
leader works with teams or followers beyond their immediate self-interests to identify
needed change, creating a vision to guide the change through influence, inspiration,
and executing the change in tandem with committed members of a group
6. Transactional: Transactional leadership or transactional management is the part of
one style of leadership that focuses on supervision, organization, and performance; it
is an integral part of the Full Range Leadership Model. This type of management was
born during the Industrial Revolution as a source of competitive advantage
7. Servant: As a servant leader, you will mix selflessness with a focus on the higher
needs of others as staff work toward achieving your vision. Through self-
reflection and awareness, you gain insight into your own purpose in life and work, the
meaning of their leadership initiatives, and your personal character.
8. Charismatic: Charismatic leadership is defined by a leader who uses his or her
communication skills, persuasiveness, and charm to influence others. Charismatic
leaders, given their ability to connect with people on a deep level, are especially
valuable within organizations that are facing a crisis or are struggling to move
forward
9. Pacesetting: Pacesetting leaders are driven to get results. You set the bar high and
push your staff to achieve goal after goal. As a pacesetting leader, you can be quite
effective in getting things done, but your constant hard-driving pace will wear down
some employees. It’s a difficult style to sustain successfully over an extended period.
10. Ethical: The concept of fairness is vital to ethical leaders. This model brings a
balance of logic and a sense of justice, with deep reverence for the rights of everyone
involved. By making ethics a top priority, you treat your staff with respect and
honesty that is mutually returned, benefiting everyone.
11. Affiliative: Affiliative leadership requires a “people first” mindset. It’s about creating
collaborative relationships and becoming an emotional support system for your team.
Connecting on a direct and personal level with your employees positions you to
quickly resolve conflicts among staff.
12. Coaching: Coaching leadership is a style that involves recognizing team members'
strengths, weaknesses and motivations to help each individual improve. It is one of
the four main leadership styles that managers use to motivate employees and achieve
success.

Motivation
Motivation is the reason for which humans initiate, continue, or terminate a behaviour at a
given time. The term "motivation" describes why a person does something. It is the driving
force behind human actions. Motivation is the process that initiates, guides, and maintains
goal-oriented behaviours.
Motivation is defined as the energy or the force that stimulates a person to act towards
the fulfilment of one's desired goal.
Motivation may be either intrinsic, if the activity is desired because it is inherently interesting
or enjoyable, or extrinsic, if the agent's goal is an external reward distinct from the activity
itself.It has been argued that intrinsic motivation has more beneficial outcomes than extrinsic
motivation.
Motivation in management refers to the steps managers can take to inspire their teams to
achieve more and support their workplace experience. When a company has managers who
motivate their teams, they may find an overall increase in productivity and achievement
Motivation implies inducing and stimulating an individual to act in certain manner. The
following points explain the process of motivation.

i.Unsatisfied Want: The motivation process begins with an unsatisfied need of an individual.
ii.Frustration: As the want remains unsatisfied frustration builds up in the mind of the
individual.
iii.Drives: The frustration drives the individual to look out for alternatives to satisfy his need.
iv.Behaviour: Among the various alternatives he chooses one and starts behaving according
to it.
v.Satisfaction: After following a particular alternative for some time, he assesses if his need is
satisfied.
vi.Reduced Frustration: Once the need is satisfied, the frustration and tension of the
individual finally gets reduced.
For example, suppose an individual desires promotion. This makes him uneasy and he starts
looking out for alternatives through which he can earn a promotion. He may think of working
harder and improving his performance. After consistently working hard, he may get
recognition and the promotion that finally satisfies his want and reduces his frustration.
Forms of Motivation Theories
 UNIT 5 MANAGERIAL CONTROL, CO-ORDINATION AND CHANGE
MANAGEMENT

Managerial control: concept and process: Effective control system: Techniques of

control- traditional and modern. Co-ordination: Meaning – steps and methods of co-
ordination. Concept, nature and process of planned change: Resistance to change:
Emerging horizons of management in a changing environment.

Managerial Control

Managerial control regulates the organizational activities. It compares the actual

performance and expected organizational standards and goals. For deviation in
performance between the actual and expected performance, it ensures that necessary
corrective action is taken.

Definition: Control is a primary goal-oriented function of management in an organisation. It

is a process of comparing the actual performance with the set standards of the company to
ensure that activities are performed according to the plans and if not then taking corrective
action.

Every manager needs to monitor and evaluate the activities of his subordinates. It helps in
taking corrective actions by the manager in the given timeline to avoid contingency or
company’s loss. Controlling is performed at the lower, middle and upper levels of the
management.

Features of Controlling
 An effective control system has the following features:
 It helps in achieving organizational goals.
 Facilitates optimum utilization of resources.
 It evaluates the accuracy of the standard.
 It also sets discipline and order.
 Motivates the employees and boosts employee morale.
 Ensures future planning by revising standards.
 Improves overall performance of an organization.
 It also minimises errors.
Controlling and planning are interrelated for controlling gives an important input into the
next planning cycle. Controlling is a backwards-looking function which brings the
management cycle back to the planning function. Planning is a forward-looking process as it
deals with the forecasts about the future conditions.
Process of Controlling: Control process involves the following steps as shown in the figure:

 Establishing standards: This means setting up of the target which needs to be

achieved to meet organisational goals eventually. Standards indicate the criteria of
performance.
Control standards are categorized as quantitative and qualitative
standards. Quantitative standards are expressed in terms of money. Qualitative
standards, on the other hand, includes intangible items.
 Measurement of actual performance: The actual performance of the employee is
measured against the target. With the increasing levels of management, the
measurement of performance becomes difficult.
 Comparison of actual performance with the standard: This compares the degree
of difference between the actual performance and the standard.
 Taking corrective actions: It is initiated by the manager who corrects any defects in
actual performance.
Controlling process thus regulates companies’ activities so that actual performance conforms
to the standard plan. An effective control system enables managers to avoid circumstances
which cause the company’s loss.
Types of control
There are three types of control viz.,
1. Feedback Control: This process involves collecting information about a finished
task, assessing that information and improvising the same type of tasks in the future.
2. Concurrent control: It is also called real-time control. It checks any problem and
examines it to take action before any loss is incurred. Example: control chart.
3. Predictive/ feedforward control: This type of control helps to foresee problem ahead
of occurrence. Therefore action can be taken before such a circumstance arises.
In an ever-changing and complex environment, controlling forms an integral part of the
organization.
Advantages of controlling
 Saves time and energy
 Allows managers to concentrate on important tasks. This allows better utilization of
the managerial resource.
 Helps in timely corrective action to be taken by the manager.
 Managers can delegate tasks so routinely chores can be completed by subordinates.

Coordination

Coordination is the process of linking the activities of various departments of the

organisation." Coordination is "the process of integrating the objectives and activities of the
separate units, departments or functional areas) of an organisation in order to achieve
organisational goals efficiently."

Coordination is the force that binds all the other functions of management. It is the common
thread that runs through all activities such as – purchase, production, sales, and finance to
ensure continuity in the working of the organisation. Sometimes it is considered as a separate
function of management.

It is however the essence of management for achieving harmony among individual efforts
towards the accomplishment of group goals. Each Managerial function is an exercise
contributing individually to coordination. Coordination is implicit and inherent in all
functions of an organisation.

Henry Fayol, “To co-ordinate is to harmonise all the activities of a person in order to
facilitate its working and its success.

George Terry, “Co-ordination deals with the task of blending efforts in order to ensure
successful attainment of an objective. It is accomplished by means of planning, organising,
actuating and controlling.”

Coordination – Steps for Effective Coordination

In order to overcome the above mentioned problems of co-ordination and get effective co-
ordination, the management should follow the following steps –

1. There should be a proper delegation of authority and responsibility at all levels of

management.
2. The whole or entire activities of the organisation should be divided department-wise or
section-wise according to the size of the organisation.
3. Preparing and adherence to rigid rules and regulations, procedures, policies, etc.
4. Establishment of an effective communication system.
5. Establishment of employees’ grievances cell.
6. There should be a proper system for reporting.
7. Skilled workers are to be rewarded adequately.
8. The management should induce the employees to take active part in meetings, committees,
conferences, seminars and the like.
9. The management should encourage the employees to have friendly relationship with
others.
10. Managers should have opportunities to get training in the area of leadership, coordination,
planning, staffing and the like.

Coordination – Advantages: Higher Efficiency and Economy, Good Human Relations,

Unity of Direction, Quintessence of Management and Organisational Effectiveness

Coordination – Problems Encountered in Achieving Co-ordination: Conflict of Objectives,

The Growing Size, Undefined Authority, Empire Building Tendencies and a Few Others
Change management

Change management is a systematic approach to dealing with the transition or transformation

of an organization's goals, processes or technologies. The purpose of change management is
to implement strategies for effecting change, controlling change and helping people to adapt
to change.

Types or forms of changes they are:

 Changes in environment and working conditions.
 Changes in the problems before present day managers.
 Changes in the scope and specialisation of the application of management knowledge.
 Changes is techniques and knowledge.

Causes for Resistance to Change:

 Economic Factors: Economic factors relate to the basic needs of the workers and they
mostly relate to – (i) necessaries of life, (ii) job security, and (iii) safely.
 Psychological Factors: In this the workers may feel that factors relating their
psychological needs will be affected adversely by the proposed changes, these factors
are:(a) Present method is inadequate and unsuitable (b) Reduction of worker’s pride
(c) Monotony is the new jobs (d) Hard labour will be needed to learn the work(e)
Workers do not want to learn new ideas (f) They may not be able to understand new
ideas

 Social Factors: Social needs like (a) New social adjustments involve stresses and
strains (b) New social set-up will be less satisfying (c) Workers oppose the change (d)
Workers resist the change (e) Changes will be beneficial for the employer

Principles of change management

Three principles of change management build on the three stages of change management
introduced by Kurt Lewin in his seminal book, Principles of Topological Psychology:

Unfreeze the current state. Change agents need to identify what precisely they want to
change. At this stage, they need to formulate a "why" that other participants are likely to buy
into. In essence, they need to reverse-engineer the future state and translate this benefit to
other possible participants. Then, they need to enroll people who can participate in the new
idea. This could include executive sponsorship for a big change or co-workers for a
departmental change.

Change the system. At this stage, change agents and any collaborators can begin to put the
change into practice. The change agents need to work with collaborators to communicate the
idea and bring other participants on board. It is important to pay attention to any pushback
and find areas of shared understanding to either help move the change forward or shift its
implementation in response to feedback. Tensions might be high as everyone gets used to the
new system. It's important to be respectful of their feelings and ideas.

Refreeze. Eventually, people get used to the new system, or they revert back to what was
working before. At this stage, it is important to declare that the change is over -- whether the
change was accepted or rejected. Even if the change was rejected, declaring it over gives
everyone a chance to relax. It is also helpful at this stage to document what happened for
future reference.

The steps that are involved in the process of management of change are as under:

Step # 1. To Identify Need for Change: It is the first step in the process of management of
change. The manager must identify the need for change in terms of those internal as well as
external factors which demand the change. He has also to ascertain whether the change is
strategic, process oriented, people oriented or a minor one.

Step # 2. To Develop New Objectives:The change is an outcome of internal as well as

external environment. Many times such environment and there by desired change demands
some alterations in the organisational objectives and goals. The management is required to
take steps in that direction.

Step # 3. To Determine Type of Change:After determining, the need and objectives of the
change the next step is to decide the type of change to be introduced. The change may take
place in relation to the objectives, organisation structure, process or people etc. Thus, the
third step is to determine the type of change required.

Step # 4. Preparing Plan for the Change:The most important step is preparing a plan for the
change such as, when, how, where and by whom the change is to be introduced. For making
the change successful it must be introduced at a right time. Such plan facilitates proper and
smooth implementation of the change with least resistance on the part of the affected
members of the organisation.

Step # 5. To Implement the Change:After preparing the plan, it is necessary to communicate

it to the concerning employees of the organisation, and convince the member about its need,
objectives, nature and possible benefits of change. An effective and proper communication
definitely helps in reducing resistance and receiving all support for implementation of the
change.

Step # 6. Review and Feedback:After implementation of the change it is necessary to make

review and feedback evaluation. Regular review and feedback may provide necessary
information to the manager for its desired implementation. For ensuring smooth
implementation of change in the right direction it is necessary to make review and evaluation
of the process of management of change.
Thus, it is only through planned change and its efficient management, that the organisation
can cope up with changing environment and may discover more profitable use of its
resources.