AUTHORITY

Barnard defines authority as the character of communication by which an order is accepted by

an individual as governing the actions that individual takes within the system. Barnard maintains
that authority will be accepted only under the following conditions:

� The individual can understand the order being communicated.

� The individual believes the order is consistent with the purpose of the organization.
� The individual sees the order as compatible with his or her personal interests.
� The individual is mentally and physically able to comply with the order.

The fewer of these 4 conditions that are present, the lower the probability that authority will be
accepted and obedience be exacted
TYPES OF AUTHORITY

3 main types of authority can exist within an organization:

� Line Authority
� Staff Authority
� Functional Authority

LINE AUTHORITY

The most fundamental authority within an organization, reflects existing superior-subordinate

relationships. It consists of the right to make decisions and to give order concerning the
production,sales or finance related behaviour of subordinates.

In general, line authority pertains to matters directly involving management system production,
sales, finance etc., and as a result with the attainment of objectives.
People directly responsible for these areas within the organization are delegated line authority to
assist them in performing their obligatory activities

STAFF AUTHORITY

Staff authority consists of the right to advise or assist those who possess line authority as well as
other staff personnel.
Staff authority enables those responsible for improving the effectiveness of line personnel to
perform their required tasks.
Line and Staff personnel must work together closely to maintain the efficiency and effectiveness
of the organization.
To ensure that line and staff personnel do work together productively, management must make
sure both groups understand the organizational mission, have specific objectives, and realize that
they are partners in helping the organization reach its objectives.
Size is perhaps the most significant factor in determining whether or not an organization will
have staff personnel. The larger the organization, the greater the need and ability to employ staff
personnel.
As an organization expands, it usually needs employees with expertise in diversified areas.
Although small organizations may also require this kind of diverse expertise, they often find it
more practical to hire part time consultants to provide it is as needed rather than to hire full time
staff personnel, who may not always be kept busy.
FUNCTIONAL AUTHORITY

Functional authority consists of the right to give orders within a segment of the organization in
which this right is normally non existent.
This authority is usually assigned to individuals to complement the line or staff authority they
already possess.
Functional Authority generally covers only specific task areas and is operational only for
designated amounts of time.
It is given to individuals who, in order to meet responsibilities in their own areas, must be able to
exercise some control over organization members in other areas.

RESPONSIBILITY

Responsibility is essentially the duty to respond to and complete tasks. It can be shared among a
team – multiple people can be responsible for achieving a specific outcome by working on the
same task, or have different tasks they are responsible for that lead to the same goal.

Responsibility cannot technically be assigned to someone. A person must choose to

take responsibility for something themselves. It is specifically task-focused – it can include: who
has what role, what that entails, and what must be done in order to be successful.

ACCOUNTABILITY

Accountability is literally the ability and/or duty to report (or give account of) on events, tasks,
and experiences. Accountability for a specific task, process, service, etc. should be assigned to
just one person. If more than one person is accountable for the result of a task, there is a much
higher risk that each person will think the others are taking charge, leading to no one taking
accountability. Tasks should be assigned based on an individual’s skills and competencies.

Whereas responsibility is an ongoing duty to complete the task at hand, accountability is what
happens after a situation occurs.
It is how a person responds and takes ownership of the results of a task.
Being accountable often means that the person is liable to face consequences from some
authority if the task isn’t completed successfully

RESPONSIBILITY VS ACCOUNTABILITY
 Responsibility in the Workplace Accountability in the Workplace

The duty to complete tasks; not doing so is a The duty to give an account of tasks after they
failure of responsibility are completed

Ongoing while final goal is being worked Happens after a situation occurs ( or in the
towards form of status update)
Can be shared among a team; many people can Should be assigned to just one person to avoid
have the same task, or different tasks that work thinking someone else will be doing the job
towards the same goal
Specifically task-focused Specifically results-focused
Cannot be assigned to someone. Each person Is assigned (ideally to one person) – they are
must take responsibility on their own held accountable for results and potential
(more behavioral) consequences of not reaching desired results

DELEGATION

Delegation is the assignment of authority to another person (normally from a manager to a

subordinate) to carry out specific activities. It is the process of distributing and entrusting work
to another person.
The process involves managers deciding which work they should do themselves and which work
should be delegated to others for completion

There are a number of reasons someone may decide to delegate. These include:
� To free themselves up to do other tasks
� To have the most qualified person making the decisions
� To seek another qualified person's perspective on an issue
� To develop someone else's ability to handle the additional assignments judiciously and
successfully

Delegation is widely accepted as an essential element of effective management. It is one of the

most useful management tools available.
The delegation of tasks across organisational levels creates connections and develops a chain of
authority

PROCESS OF DELEGATION

● The process of delegation does not always follow a conformed structure, nor is it
straightforward, however there are a number of key aspects which are generally involved.
The generalised process of delegation involves some combination of the following:
● Allocation of duties: the delegator communicates to their subordinate the task which is to
be performed. Resources are provided and a time limit is informed.
 ● Delegation of authority: In order for the subordinate to perform the task, authority is
required. The required authority is granted to the employee when the task is delegated.
● Assignment of responsibilities: When authority is delegated, the subordinate is assigned
with the responsibility of this task. When someone is given the rights to complete a task,
they are assigned with the corresponding obligation to perform. Responsibility itself
cannot be entirely delegated; a manager must still operate under equal responsibility to
the delegated authority.
● Creation of accountability: At the completion of the delegation process, it is essential that
the manager creates accountability, meaning that subordinates must be answerable for
the tasks/ results which they have been authorised to carry out.

DECENTRALIZATION

Decentralization or decentralisation is the process by which the activities of an organization,

particularly those regarding planning and decision making, are distributed or delegated away
from a central, authoritative location or group.

Determinants of effective decentralization/ factors determining decentralization

� Size of organization
� Are operations diverse
� Number of competent employees
� Top management outlook
� Nature of functions performed
� Communication system
� Control process in organization
� Environment factors
CENTRALISATION VS DECENTRALISATION

CENTRALIZATION DECENTRALIZATION
Hierarchical decision making Democratic decision making

Bureaucratic Flexible
Vertical flow of information Open flow
Fit for small organization Fit for large
Fast decision making Slow decision making
Few people involved in decision making More people involved
Demotivated employee Highly motivated employee
No conflict while taking decision Conflict in decision making most likely to
occur
Ony one group of people carry the burden Burden is distributed
Used when external environment is complex Used when environment is stable
and unpredictable
Employees hold less experience and skills Employees hold more skills, knowledge and
experience
 CONTROL

MEANING

Management control is setting of predetermined standards, then, comparison of actual

performance with these predetermined standards and, if necessary, taking corrective actions in
order to achieve organizational goals

Definitions of Control

“Managerial control implies the measurement of accomplishment against the standard and the
correction of deviations to assure attainment of objectives according to plans”.– Koontz and
O’Donnell

“Control is the process of bringing about conformity of performance with planned action.”
– Dale Henning

“Controlling is a systematic exercise which is called as a process of checking actual

performance against the standards or plans with a view to ensure adequate progress and also
recording such experience as is gained as a contribution to possible future needs.”– Brech

“Just as a navigator continually takes reading to ensure whether he is relative to a planned

action, so should a business manager continually take reading to assure himself that his
enterprise is on right course.” – Donnell

CHARACTERISTICS

Following are the characteristics of controlling function of management-

1. Controlling is last function: Controlling is a function which is performed when all

other functions are completed. It is concerned with knowing what the actual
performance was and how much it was deviated from the standards set. On the basis of
which the corrective actions are taken.

2. Controlling is a pervasive function: It is performed at all levels and in all kinds of

business organizations. No organisation can think of surviving even for a short duration
 of time without proper control. Control helps the managers in making proper decisions
in the near future.

3. Controlling is backward looking: The function of controlling is backward looking as

it is concerned with what happened in the past and is it different from the actual set
standards. While looking at the past actions the managers can make more proper
controlling techniques.

4. Controlling is a dynamic process: Since controlling requires taking revival methods,

changes have to be made wherever possible. Control cannot be a rigid affair, the control
policy needs to be revised and modified as and when the situation arrives.

5. Controlling is related with planning: Planning and Controlling are two inseparable
functions of management. Without planning, controlling is a meaningless exercise and
without controlling, planning is useless. Planning presupposes controlling and
controlling succeeds planning.

6. Controlling is a Fundamental Management Function: Controlling is the most

important in all the functions of management. All other functions of management
cannot be performed successfully without it.

7. Controlling is a Continuous process: Control function is needed at all the times. It is

repeated after a regular interval. Under controlling, the progress has to be evaluated
regularly. One cannot think of performing the function only once and survive for the
rest of the life easily.

CONTROL PROCESS

The various steps in controlling may broadly be divided into four parts:

(i) setting of standards; (ii) measurement of actual performance

(iii) Comparison of actual Performance with the Standards

(iv) Taking corrective measures

1. Setting of standards: Standards are the plans or the targets which have to be achieved
in the course of business function. They can also be called as the criterions for judging
the performance. Standards generally are classified into two-

(a) Quantitative or tangible - Those standards which can be measured and expressed
in terms of money are called as measurable standards. They can be in form of cost,
output, expenditure, time, profit, etc.

(b) Qualitative or intangible - There are standards which cannot be measured

monetarily. For example: performance of a manager, deviation of workers, their
attitudes towards a concern. These are called as intangible standards.

Controlling becomes easy through establishment of these standards because controlling

is exercised on the basis of these standards.

2. Measurement of Actual Performance: Actual performance is measured in the form of

reports. Manager review these reports. These reports are prepared as per the standards.
This will ensure the manager whether activities are according to plans or not.
Performances of Quantitative activities are easily measured. Psychological tests and
surveys are used for measurement of qualitative performance. Measurement of
performance is an essential part of control process. Measurement helps in early
detection of the faults in this way; if measurement is such that deviation is detected at
the earliest then it will enable appropriate action well in time.
 3. Comparison of actual Performance with the Standards: At this step, actual
performance is compared with the standards in order to find out the deviation. When
managers evaluate the reports or make observations, they are able to find out whether
actual performance is according to standards or not. Performance reports helps in this
comparison by putting the standard values along with the actual performance for a given
period. It helps in finding out the variation.

4. Taking corrective measures: When manager finds some variance in the actual
performance, he has to take some corrective measures. He has to make the necessary
changes and implement those changes in the organization. In today highly competitive
environment, manager and employees can evaluate their performance. They can find the
causes for the faults and they can take the corrective measures for their work.

IMPORTANCE OF CONTROL

1. Helps in achieving the goals of the organization: The continuous updating of the
various activities helps in the smooth running of the organization. Corrective actions are
taken by the manager if the work is not according to the plans.

2. Effective utilization of resources: The control system focuses on the improvement of

the organizational efficiency. It motivates the managers. All the jobs are regularly
evaluated and if the deviations are found, it can be corrected very easily. It helps the
manager to change the psychology On the other hand control ensures that employees are
performing right jobs.

3. Promotes Coordination: Control brings coordination in the activities of the

organization. It takes the help of unity of action. Different managers of the different
departments control the performance of the subordinates to achieve the organizational
goals. It is a check on the performance of the employees and fruitful results are achieved
only when everything is properly coordinated.

4. Helps in implementation of Delegation and Decentralization of Authority: A

decision about follow-up action is also facilitated. Control system helps in
implementation of delegation and decentralization. Decentralization of authority is
 inseparable part of the large scale organizations. The manager cannot use the delegate of
authority without having the effective control system. The control is established as the
targets or standards for various departments. Budgetary control, standard control etc are
the controlling techniques which help in implementing the decentralization with proper
control system.

5. Provide time to manager for concentrating on key issues: Effective control system
provides a manger sufficient time, so that he can have sufficient time for other key
managerial issues. It helps in implementation of management by exception which
enables the top management for various policies and plans for the organization.

Functions of control

1. Setting Performance Standards

 Definition: Establishing clear, measurable, and attainable standards that align with
organizational objectives.
 Purpose: Provides benchmarks for evaluating performance.
 Example: Setting sales targets or production goals for a quarter.

2. Measuring Actual Performance

 Definition: Collecting data to track how well actual performance aligns with established
standards.
 Purpose: Helps management understand the current performance level.
 Example: Measuring monthly revenue, production output, or employee efficiency.

3. Comparing Actual Performance with Standards

 Definition: Analyzing the difference between actual performance and pre-set standards.
 Purpose: Identifies any deviations or variances.
 Example: Comparing actual sales figures against targets or expected profit margins.

4. Identifying Deviations
 Definition: Spotting where performance falls short of the established standards.
 Purpose: Pinpoints areas needing improvement.
 Example: Noticing that production is lagging behind due to machine malfunctions or
staff shortages.

5. Taking Corrective Action

 Definition: Implementing changes to address performance gaps and deviations.
 Purpose: Brings performance back in line with the standards.
  Example: Introducing new training programs, revising processes, or reallocating
resources.

6. Feedback and Continuous Improvement

 Definition: Using information from the control process to continuously improve
operations.
 Purpose: Ensures that control mechanisms evolve to stay effective over time.
 Example: Revising performance standards based on feedback or adapting to changing
market conditions.
These control functions ensure an organization’s activities are aligned with its strategic goals and
provide a system for continuous monitoring and improvement.
Nature of Control

1. Goal-Oriented
 Definition: Control is directly tied to the achievement of organizational goals and
objectives.
 Purpose: Ensures that all activities lead toward predefined outcomes.
 Example: A company establishes control systems to ensure production efficiency aligns
with profitability goals.

2. Pervasive Function
 Definition: Control is a function that exists at every level of the organization.
 Purpose: All managerial roles, whether at the top, middle, or lower levels, are
responsible for implementing control mechanisms.
 Example: A CEO might control overall business strategy, while a line manager controls
daily operational processes.

3. Continuous Process
 Definition: Control is not a one-time activity but an ongoing process of monitoring and
adjustment.
 Purpose: Allows for real-time feedback and correction to ensure consistent performance.
 Example: A sales manager reviews weekly sales figures and adjusts tactics to meet
monthly targets.

4. Dynamic and Flexible

 Definition: Control systems need to adapt to changing environments, technologies, and
internal processes.
 Purpose: Flexibility ensures that controls remain effective even as circumstances change.
 Example: A company might update its quality control process when new production
technology is introduced.

5. Future-Oriented
 Definition: Although control systems measure past performance, they aim to influence
future actions and decisions.
  Purpose: Helps in predicting potential deviations and preparing for future challenges.
 Example: Budgetary controls review past expenditures to set future financial plans and
allocations.

6. Involves Measurement
 Definition: Control relies on measurable metrics to evaluate performance.
 Purpose: Quantifying performance allows for objective comparisons between actual and
expected results.
 Example: Measuring the number of units produced against a target for efficiency
analysis.

7. Linked with Planning

 Definition: Control is closely related to the planning function because it ensures that the
plans set by the organization are being followed.
 Purpose: Planning sets the standards, and control ensures those plans are executed
properly.
 Example: A marketing plan may set a target market share, and control systems monitor
performance to ensure the company captures that share.

8. Corrective in Nature
 Definition: Control is designed not only to identify deviations but also to correct them.
 Purpose: Corrective action ensures that any shortcomings are addressed quickly to keep
the organization on track.
 Example: If production costs exceed the budget, management might implement cost-
saving measures.

9. Involves Human Element

 Definition: Control affects and is implemented by people, making it necessary to
consider behavioral factors.
 Purpose: Human reactions, motivations, and skills must be considered for effective
control.
 Example: Employee performance evaluation systems must be fair and motivating to
ensure buy-in.

10. Ensures Coordination

 Definition: Control helps in aligning various departments and functions toward a
common goal.
 Purpose: It ensures that all parts of the organization work together efficiently and
effectively.
 Example: A control system might ensure that the production department and sales team
coordinate their activities to meet customer demand.
Span of Control
The "span of control" refers to the number of subordinates or employees that a manager or
supervisor can effectively oversee. It's a crucial concept in management and organizational
design, influencing how work is distributed, how communication flows, and the overall structure
of an organization.

Types of Span of Control:

1. Narrow Span of Control:
o A manager supervises a small number of subordinates.
o Characteristics:
 Close supervision
 More hierarchical levels
 Slower decision-making process
o Best for complex or specialized tasks requiring more guidance.
2. Wide Span of Control:
o A manager supervises a large number of subordinates.
o Characteristics:
 More autonomy for employees
 Fewer hierarchical levels
 Faster decision-making process
o Suitable for simpler, repetitive tasks where employees are more self-sufficient.

Factors Influencing Span of Control:

1. Complexity of Tasks: The more complex the tasks, the narrower the span of control
should be to allow more direct supervision.
2. Geographical Dispersion: A wider span is more difficult when employees are spread
across locations.
3. Skill Level and Experience: Highly skilled and experienced employees require less
supervision, allowing for a wider span.
4. Managerial Style: Leaders who are more hands-off (delegative) can manage more
people effectively.
5. Technology and Tools: Modern communication and management tools can enable wider
spans by facilitating easier oversight.

Importance of Span of Control:

 Organizational Efficiency: A balance is needed to avoid bottlenecks or overburdening
managers.
 Employee Satisfaction: A manager with too many subordinates may struggle to provide
adequate support, while too few may lead to micromanagement.
 Cost Control: A wider span of control reduces the need for multiple layers of
management, which can lower costs.
TYPES OF CONTROL

Different types of control systems act as a feedback mechanism which helps the manager to
review the various plans, strategies for the success of the organization. It is the foundation for the
further planning, organizing, and leading functions.
 Pro-activity control: It monitors the jobs and the employees in such a way that it provides
the timely prevention of the faults. Problems are identified and solved in advance as the process
is going to start. The corrective measures are taken to help our plan succeed.

Concurrent Controls: The process of controlling the ongoing activities and jobs is called
concurrent control. It helps in adjusting the activities according to the situations. It deals with the
present scenario of the plans

Feedback Controls: Finally, feedback controls is about the collecting and analyzing the
data about a completed activity, evaluating that information and taking corrective actions to
improve the future plans. It is based on historical data and the future activities are planned in the
light of past records.

Financial control: Financial control involves the various techniques which help in
controlling the cost and expenses as per the budgets of the organization. Thus, management
decides the criteria which are basis for the forecasting of the budgets. The information regarding
budgeted performance.

Non financial Controls: Now days, organizations measure the non financial performance
areas like job satisfaction, motivation, customer loyalty etc. These Non financial aspects help in
success of the organization. For example, highly satisfied customer means that there will be rise
in future sale.

Direct controls:

(a) Called as the direct controls as the people here get so well trained to the job that there
are very less chances for the faults to take place.

(b) Also called as the preventive controls.

(c) Aims at the saving on the cost of the control.

(d) The main purpose is the zero mistake from starting

(e) Great emphasis is given to build the systems, the procedures, the culture, the discipline
etc.

(f) But after some time, this control system gets old and cannot be used again.

(g) For the proper functioning of the direct controls, assistance of the indirect controls is
very much needed.
 Behavioral Control: It is concerned with the evaluation of decision making process in the
organization. Balanced scorecard is used to control the behaviour of the employees. It identifies
the various factors which have impact on the manager’s decisions and organizational
performance.

Strategic control: Strategic control focuses on the implementation of the strategy. If any
problem is detected, it helps in modification of the strategy. It keeps a check on the type of the
strategy.

Operational control: Operational control focuses on the execution of the strategy. These
are established in consistent with the strategy. Controlling over the return on investment,
profitability, cost, and product quality are the objective of the operational control. Recommended
Corrective plans based on operating controls may lead to the strategic controls when they involve
changes in the strategy.

Feed forward controls: As its name suggests, this control is performed in advance. It is
very important for taking corrective measures at the early stages of the problem. Both the feed
forward and feed backward control should be used in the organization. It focuses on the effective
direction and control from starting.

(a) Whenever a process is performed, two factors are very critical namely the inputs and the
outputs.

(b) the various problems are solved in advance that are to be occurred in future, so that
manager can control the issues at earlier stages.

(c) The shape of the feedback controls is taken by almost all the controls.

(d) It is advised by the various experts to have the both feed forward and the feed backward
controls on the process.

(e) Helps in the establishment of a right direction and control right from the beginning.

Feed backward controls: The control is used at the end and faults and variation in work is
estimated at the end of the work. The cost of this control is high. It is not very useful method of
control.

Real time controls: In real time controls, the feedback is done in real time. The reports are
prepared and sent to manager without any time gap.
 Automated controls: In this type of control, computerized feedback systems are used for
monitoring. The human intervention is minimum in this type of control

Direct Control Versus preventive control

Direct Control and Preventive Control are two distinct approaches to managing and guiding
behavior within an organization, each with its unique focus and application.

1. Direct Control:
 Definition: Direct control involves monitoring and correcting behavior and performance
in real time. It is reactive in nature, focusing on immediate supervision to ensure that
employees or systems are performing tasks as expected.
 Characteristics:
o Active Monitoring: Managers or supervisors continuously oversee work.
o Immediate Feedback: Corrections or adjustments are made instantly when
deviations occur.
o Hands-On Management: Requires constant involvement from leadership, often
leading to micromanagement.
o Example: A factory supervisor watching workers on an assembly line to ensure
they are following safety protocols or productivity targets.
 Advantages:
o Problems are identified and addressed immediately.
o Reduces risk of errors escalating.
 Disadvantages:
o Time-consuming for managers.
o Can lead to employee dependency on constant supervision.
o May stifle innovation or autonomy.

2. Preventive Control:
 Definition: Preventive control focuses on designing systems, processes, and procedures
to prevent problems or deviations before they happen. It is proactive in nature and
emphasizes preempting issues by setting up proper structures.
 Characteristics:
o Focus on Prevention: Rather than correcting issues as they arise, preventive
control aims to eliminate the root causes of potential problems.
o Use of Policies and Procedures: Clear guidelines, training, and standard
operating procedures are put in place to prevent errors.
o Risk Management: Identifies and mitigates risks before they materialize.
o Example: Implementing automated systems with built-in error checks, or training
employees to follow strict safety protocols to prevent accidents.
 Advantages:
o Reduces the occurrence of issues by addressing potential causes upfront.
o Empowers employees to make decisions based on predefined standards.
o Fewer resources needed for real-time oversight.
 Disadvantages:
 o May not prevent every issue.
o Requires careful planning and upfront investment in systems or training.
o Can be rigid, limiting flexibility in unforeseen situations.

Key Differences:
Aspect Direct Control Preventive Control
Reactive, focuses on correcting Proactive, focuses on preventing issues
Nature
after an issue arises. before they occur.
Timeframe Real-time or immediate. Pre-event or anticipatory.
Manager Lower, as systems or rules are in place to
High level of ongoing supervision.
Involvement guide behavior.
Correcting employee performance Establishing policies to avoid potential
Examples
on the spot. issues.
Eliminate risks and prevent errors from
Goal Ensure compliance in the moment.
happening.
Offers flexibility for immediate More rigid, but allows employees
Flexibility
changes. autonomy within the system.

Application:
 Direct Control is often used in environments where immediate results are critical, such
as in crisis management, production lines, or customer service.
 Preventive Control is common in quality assurance, financial management, compliance,
and safety protocols where the cost of failure is high, and prevention is better than
correction.
Both controls are important and often complementary, as organizations need direct control to
manage day-to-day operations while preventive control ensures long-term stability and
efficiency.
Total Quality Management - Meaning and Important Concepts
Quality refers to a parameter which decides the superiority or inferiority of a product or service.
Quality can be defined as an attribute which differentiates a product or service from its
competitors. Quality plays an essential role in every business. Business marketers need to
emphasize on quality of their brands over quantity to survive the cut throat competition.

Why would a customer come to you if your competitor is also offering the same product? The
difference has to be there in quality. Your brand needs to be superior for it to stand apart from
the rest.

Total Quality Management

Total Quality management is defined as a continuous effort by the management as well as

employees of a particular organization to ensure long term customer loyalty and customer
satisfaction. Remember, one happy and satisfied customer brings ten new customers along with
him whereas one disappointed individual will spread bad word of mouth and spoil several of
your existing as well as potential customers.
You need to give something extra to your customers to expect loyalty in return. Quality can be
measured in terms of durability, reliability, usage and so on. Total quality management is a
structured effort by employees to continuously improve the quality of their products and services
through proper feedbacks and research. Ensuring superior quality of a product or service is not
the responsibility of a single member.

Every individual who receives his/her paycheck from the organization has to contribute equally
to design foolproof processes and systems which would eventually ensure superior quality of
products and services. Total Quality management is indeed a joint effort of management, staff
members, workforce, suppliers in order to meet and exceed customer satisfaction level. You
can’t just blame one person for not adhering to quality measures. The responsibility lies on the
shoulder of everyone who is even remotely associated with the organization.

W. Edwards Deming, Joseph M. Juran, and Armand V. Feigenbaum jointly developed the
concept of total quality management. Total Quality management originated in the manufacturing
sector, but can be applied to almost all organizations.

Total quality management ensures that every single employee is working towards the
improvement of work culture, processes, services, systems and so on to ensure long term
success.

Total Quality management can be divided into four categories:

 Plan
 Do
 Check
 Act
Also referred to as PDCA cycle.

Planning Phase

Planning is the most crucial phase of total quality management. In this phase employees have to
come up with their problems and queries which need to be addressed. They need to come up with
the various challenges they face in their day to day operations and also analyze the problem’s
root cause. Employees are required to do necessary research and collect relevant data which
would help them find solutions to all the problems.

Doing Phase

In the doing phase, employees develop a solution for the problems defined in planning phase.
Strategies are devised and implemented to overcome the challenges faced by employees. The
effectiveness of solutions and strategies is also measured in this stage.

Checking Phase

Checking phase is the stage where people actually do a comparison analysis of before and after
data to confirm the effectiveness of the processes and measure the results.
Acting Phase

In this phase employees document their results and prepare themselves to address other
problems.

Importance of Quality Management

“Quality management” ensures superior quality products and services. Quality of a product
can be measured in terms of performance, reliability and durability. Quality is a crucial
parameter which differentiates an organization from its competitors. Quality management tools
ensure changes in the systems and processes which eventually result in superior quality products
and services. Quality management methods such as Total Quality management or Six Sigma
have a common goal - to deliver a high quality product. Quality management is essential to
create superior quality products which not only meet but also exceed customer satisfaction.
Customers need to be satisfied with your brand. Business marketers are successful only when
they emphasize on quality rather than quantity. Quality products ensure that you survive the cut
throat competition with a smile.

Quality management is essential for customer satisfaction which eventually leads to

customer loyalty. How do you think businesses run? Do businesses thrive only on new
customers? It is important for every business to have some loyal customers. You need to have
some customers who would come back to your organization no matter what.

Would you buy a Nokia mobile again if the previous handset was defective? The answer is NO.

Customers would return to your organization only if they are satisfied with your products and
services. Make sure the end-user is happy with your product. Remember, a customer would be
happy and satisfied only when your product meets his expectations and fulfills his needs.
Understand what the customer expects from you? Find out what actually his need is? Collect
relevant data which would give you more insight into customer’s needs and demands. Customer
feedbacks should be collected on a regular basis and carefully monitored. Quality management
ensures high quality products and services by eliminating defects and incorporating continuous
changes and improvements in the system. High quality products in turn lead to loyal and satisfied
customers who bring ten new customers along with them. Do not forget that you might save
some money by ignoring quality management processes but ultimately lose out on your major
customers, thus incurring huge losses. Quality management ensures that you deliver products as
per promises made to the customers through various modes of promotions. Quality
management tools help an organization to design and create a product which the customer
actually wants and desires.

Quality Management ensures increased revenues and higher productivity for the
organization. Remember, if an organization is earning, employees are also earning. Employees
are frustrated only when their salaries or other payments are not released on time. Yes, money is
a strong motivating factor. Would you feel like working if your organization does not give you
salary on time? Ask yourself. Salaries are released on time only when there is free cash flow.
Implementing Quality management tools ensure high customer loyalty, thus better business,
increased cash flow, satisfied employees, healthy workplace and so on. Quality management
processes make the organization a better place to work.
Remove unnecessary processes which merely waste employee’s time and do not contribute much
to the organization’s productivity. Quality management enables employees to deliver more work
in less time.

Quality management helps organizations to reduce waste and inventory. It enables

employees to work closely with suppliers and incorporate “Just in Time” Philosophy.

Quality management ensures close coordination between employees of an organization. It

inculcates a strong feeling of team work in the employees.

What is Kaizen ? - Five S of Kaizen

“Kaizen” refers to a Japanese word which means “improvement” or “change for the
better”. Kaizen is defined as a continuous effort by each and every employee (from the CEO
to field staff) to ensure improvement of all processes and systems of a particular
organization. Work for a Japanese company and you would soon realize how much importance
they give to the process of Kaizen. The process of Kaizen helps Japanese companies to outshine
all other competitors by adhering to certain set policies and rules to eliminate defects and ensure
long term superior quality and eventually customer satisfaction.
Kaizen works on the following basic principle.
“Change is for good”.
Kaizen means “continuous improvement of processes and functions of an organization
through change”. In a layman’s language, Kaizen brings continuous small improvements in the
overall processes and eventually aims towards organization’s success. Japanese feel that many
small continuous changes in the systems and policies bring effective results than few major
changes.
Kaizen process aims at continuous improvement of processes not only in manufacturing
sector but all other departments as well. Implementing Kaizen tools is not the responsibility of
a single individual but involves every member who is directly associated with the organization.
Every individual, irrespective of his/her designation or level in the hierarchy needs to contribute
by incorporating small improvements and changes in the system.

Following are the main elements of Six Sigma:

 Teamwork
 Personal Discipline
 Improved Morale
 Quality Circles
 Suggestions for Improvement
Five S of Kaizen
“Five S” of Kaizen is a systematic approach which leads to foolproof systems, standard policies,
rules and regulations to give rise to a healthy work culture at the organization. You would hardly
find an individual representing a Japanese company unhappy or dissatisfied. Japanese employees
never speak ill about their organization. Yes, the process of Kaizen plays an important role in
employee satisfaction and customer satisfaction through small continuous changes and
eliminating defects. Kaizen tools give rise to a well organized workplace which results in better
productivity and yield better results. It also leads to employees who strongly feel attached
towards the organization.
Let us understand the five S in Detail:
1. SEIRI - SEIRI stands for Sort Out. According to Seiri, employees should sort out and
organize things well. Label the items as “Necessary”, ”Critical”, ”Most Important”, “Not
needed now”, “Useless and so on. Throw what all is useless. Keep aside what all is not
needed at the moment. Items which are critical and most important should be kept at a
safe place.
2. SEITION - Seition means to Organize. Research says that employees waste half of their
precious time searching for items and important documents. Every item should have its
own space and must be kept at its place only.
3. SEISO - The word “SEISO” means shine the workplace. The workplace ought to be kept
clean. De-clutter your workstation. Necessary documents should be kept in proper folders
and files. Use cabinets and drawers to store your items.
4. SEIKETSU-SEIKETSU refers to Standardization. Every organization needs to have
certain standard rules and set policies to ensure superior quality.
5. SHITSUKE or Self Discipline - Employees need to respect organization’s policies and
adhere to rules and regulations. Self discipline is essential. Do not attend office in
casuals. Follow work procedures and do not forget to carry your identity cards to work. It
gives you a sense of pride and respect for the organization.
Kaizen focuses on continuous small improvements and thus gives immediate results.

Six Sigma and Quality Management

Six Sigma is a business management strategy which aims at improving the quality of processes
by minimizing and eventually removing the errors and variations. The concept of Six Sigma was
introduced by Motorola in 1986, but was popularized by Jack Welch who incorporated the
strategy in his business processes at General Electric. The concept of Six Sigma came into
existence when one of Motorola’s senior executives complained of Motorola’s bad quality. Bill
Smith eventually formulated the methodology in 1986.

Quality plays an important role in the success and failure of an organization. Neglecting an
important aspect like quality, will not let you survive in the long run. Six Sigma ensures
superior quality of products by removing the defects in the processes and systems. Six
sigma is a process which helps in improving the overall processes and systems by identifying
and eventually removing the hurdles which might stop the organization to reach the levels of
perfection. According to sigma, any sort of challenge which comes across in an organization’s
processes is considered to be a defect and needs to be eliminated.
Organizations practicing Six Sigma create special levels for employees within the organization.
Such levels are called as: “Green belts”, “Black belts” and so on. Individuals certified with any
of these belts are often experts in six sigma process. According to Six Sigma any process
which does not lead to customer satisfaction is referred to as a defect and has to be
eliminated from the system to ensure superior quality of products and services. Every
organization strives hard to maintain excellent quality of its brand and the process of six sigma
ensures the same by removing various defects and errors which come in the way of customer
satisfaction.

The process of Six Sigma originated in manufacturing processes but now it finds its use in other
businesses as well. Proper budgets and resources need to be allocated for the implementation of
Six Sigma in organizations.

Following are the two Six Sigma methods:

 DMAIC
 DMADV
DMAIC focuses on improving existing business practices. DMADV, on the other hand focuses
on creating new strategies and policies.

DMAIC has Five Phases

D - Define the Problem. In the first phase, various problems which need to be addressed to are
clearly defined. Feedbacks are taken from customers as to what they feel about a particular
product or service. Feedbacks are carefully monitored to understand problem areas and their root
causes.

M - Measure and find out the key points of the current process. Once the problem is
identified, employees collect relevant data which would give an insight into current processes.

A - Analyze the data. The information collected in the second stage is thoroughly verified. The
root cause of the defects are carefully studied and investigated as to find out how they are
affecting the entire process.

I - Improve the current processes based on the research and analysis done in the previous
stage. Efforts are made to create new projects which would ensure superior quality.

C - Control the processes so that they do not lead to defects.

DMADV Method

D - Design strategies and processes which ensure hundred percent customer satisfaction.

M - Measure and identify parameters that are important for quality.

A - Analyze and develop high level alternatives to ensure superior quality.

D - Design details and processes.

V - Verify various processes and finally implement the same.

Inventory Management and Just In Time (JIT)

Inventory Holding

For an organization, it becomes important to hold inventory for the following reason:

 Inventory holding ensures that operation delay do not impact delivery to customers.
 It also ensures that company can meet spikes or fluctuation in product demand.
 It ensures that there is flexibility in production.
 It ensures that any delay by suppliers do not affect working of the company.
Considering the above inventory holding objectives, next step for the company is to make
inventory related decision. Inventory decision involves two major considerations, first is the
order quantity of the raw material and second is timing for placing those orders.

Inventory management ensures that organizations are able to minimize cost and maximize
profit.

Just In Time (JIT)

Just In Time is set of strategic activities, which are formulated to achieve maximum production
with minimal maintenance of inventory. JIT as philosophy is applicable to various types of
organization but on implement side it is more relevant with manufacturing operations.

For JIT system to be successful, there are two critical elements, attitude of workers/management
and practice.

Fundamentals of JIT

JIT is based on the following fundamentals:

 JIT manufacturing and ordering

 Elimination of waste
 Lean management
 Signal System (Kanban)
 Push-Pull System
With the above fundamentals in place, JIT delivers the following:

 Continuous improvement of production and order processing.

 Elimination of non-value added activities and procedures.
 Simplification and advancement of the existing systems.
 Creation of safety environment and ensuring total quality management.
 Creation crossed skilled workers.

Trends and challenges of management in global scenario

Trends in Global Management
1. Digital Transformation:
o Automation & AI: Integration of automation and artificial intelligence (AI)
across industries, driving efficiency and decision-making.
o Big Data & Analytics: Data-driven decision-making is becoming central to
global strategies, with the ability to process large datasets providing a competitive
advantage.
o Remote and Hybrid Work: Accelerated by the COVID-19 pandemic, flexible
work arrangements are becoming standard, requiring new management
approaches for productivity and collaboration.
2. Sustainability and ESG (Environmental, Social, Governance):
o Companies are increasingly being evaluated not just on financial performance but
also on their environmental impact, social responsibility, and governance
practices.
o Sustainable Business Models: Businesses are integrating sustainable practices
into their operations, seeking carbon neutrality and focusing on long-term
viability.
3. Globalization and Cross-Cultural Management:
o Companies continue to expand across borders, requiring leaders to manage
culturally diverse teams, customers, and regulations.
o Localized Strategies: Global firms must adapt to local market conditions while
maintaining global consistency, balancing standardization with customization.
4. Agility and Innovation:
o Companies are adopting more agile methodologies to respond quickly to market
changes and disruption.
o Continuous Innovation: Emphasis on constant innovation and disruption in
business models, products, and services to maintain a competitive edge.
5. Employee-Centric Focus:
o Talent Management: With increased competition for top talent, organizations are
investing in employee well-being, engagement, and upskilling.
o Diversity, Equity, and Inclusion (DEI): There is growing emphasis on creating
diverse and inclusive workplaces as part of a long-term business strategy.
6. Cybersecurity and Data Privacy:
o As companies become more reliant on digital platforms, there is a parallel
increase in the importance of protecting sensitive data and ensuring cybersecurity
compliance across regions.

Challenges in Global Management

1. Cultural Differences:
o Managing teams from different cultural backgrounds presents challenges in
communication, management styles, and expectations.
o Misunderstandings or conflicts arising from cultural norms can hinder
productivity and collaboration.
 2. Economic Volatility and Geopolitical Risks:
o Global operations are affected by political instability, trade wars, economic
downturns, and changing regulations in different regions.
o Supply Chain Disruptions: Events like pandemics, wars, or natural disasters can
severely impact global supply chains, making resilience a priority for global
managers.
3. Technological Disparities:
o While some regions have cutting-edge technology infrastructure, others may lag
behind. Global firms must adapt strategies to operate across these different
technological landscapes.
4. Regulatory Compliance:
o Companies operating globally must navigate different legal frameworks,
regulations, and compliance issues. Data privacy laws (e.g., GDPR in Europe) and
tax regulations are particularly complex.
o Intellectual Property Protection: Ensuring consistent protection of intellectual
property across multiple jurisdictions remains a challenge.
5. Workforce Dynamics:
o As automation grows, global companies face the challenge of upskilling or
reskilling employees to stay relevant.
o Managing a global workforce in different time zones with varying labor laws and
employment standards adds complexity to HR management.
6. Leadership Challenges:
o Global leaders must have a broad skill set, including cross-cultural
communication, adaptability, and crisis management.
o Retaining Global Talent: Companies face challenges in retaining key employees
due to rising competition, especially in regions with high talent demand.
7. Sustainability and Ethical Practices:
o While sustainability is a priority, balancing short-term profitability with long-term
sustainable goals poses challenges, especially in industries with high
environmental impact.
o Ethical Challenges: Companies may face ethical dilemmas when balancing local
customs, legal frameworks, and corporate ethical standards.
8. Customer Expectations:
o In a globalized world, customers expect faster, personalized, and high-quality
service. Meeting these demands at scale requires innovation and operational
efficiency.
Emerging Issues in Management

1. Artificial Intelligence (AI) and Automation in Management:

 AI-Driven Decision Making: Managers increasingly rely on AI to provide data insights,
predictive analytics, and even automate certain decision-making processes.
 Automation of Tasks: Routine managerial tasks, such as performance monitoring, data
entry, and report generation, are being automated. Managers now focus on more strategic
and creative functions.
  Ethical Concerns: The rise of AI brings ethical concerns related to privacy, data bias,
and the displacement of human jobs.

2. Remote and Hybrid Work:

 Managing Distributed Teams: As remote and hybrid work models become permanent
for many organizations, managers face the challenge of maintaining team cohesion,
productivity, and communication across different locations and time zones.
 Work-Life Balance and Employee Well-Being: Managers must find ways to address
employee burnout, mental health concerns, and work-life balance in remote setups.
 Performance Metrics for Remote Work: Traditional productivity measures may not
apply to remote work environments, requiring managers to rethink how performance is
evaluated.

3. Sustainability and Climate Change:

 Green Management Practices: Businesses are being pressured to adopt sustainable
practices, reduce their carbon footprints, and contribute to climate change mitigation.
 Corporate Social Responsibility (CSR): Managers are increasingly accountable for
ensuring their organizations meet social and environmental responsibilities, not just
financial goals.
 Circular Economy: Organizations are exploring circular business models (reuse,
recycle, and reduce waste) to align with sustainable development goals.

4. Diversity, Equity, and Inclusion (DEI):

 Inclusive Leadership: Managers are now tasked with fostering diverse, equitable, and
inclusive workplaces, which is not just a moral obligation but also a driver of innovation
and competitive advantage.
 Managing Multigenerational Workforces: As younger generations (Millennials, Gen
Z) enter the workforce, managers need to address generational differences in work
preferences, expectations, and communication styles.
 Bias and Discrimination: Addressing unconscious bias, workplace discrimination, and
ensuring equal opportunities for all employees is an ongoing challenge.

5. Ethical and Responsible Leadership:

 Transparency and Accountability: There is increasing pressure for ethical leadership,
especially in the face of corporate scandals and public distrust in large organizations.
Managers must lead with transparency, fairness, and integrity.
 Handling Ethical Dilemmas: As organizations expand globally, managers often face
ethical challenges related to local laws, labor practices, and business conduct.
 Stakeholder vs. Shareholder Focus: The traditional focus on maximizing shareholder
value is evolving into a broader stakeholder approach, considering the impact on
employees, customers, society, and the environment.
6. Cybersecurity and Data Privacy:
 Protecting Digital Assets: With the rise of digital businesses, managers must ensure the
protection of sensitive data and intellectual property. Cybersecurity has become a core
issue for businesses of all sizes.
 Data Governance: Compliance with global data privacy regulations (e.g., GDPR,
CCPA) and managing customer data responsibly are top concerns for managers.

7. Technological Disruption and Adaptation:

 Blockchain and Decentralized Technologies: Emerging technologies like blockchain
are disrupting traditional business models, especially in finance, supply chain
management, and record-keeping.
 Adapting to Technological Changes: Managers are required to continuously adapt and
lead organizational changes in response to technological innovations.
 Tech-Savvy Leadership: The ability to understand and leverage technology is becoming
a crucial skill for managers across all industries.

8. Talent Management and the Future of Work:

 Skills Gap: The rapid pace of technological change has created a skills gap in the
workforce. Managers need to invest in continuous learning and development programs to
keep employees updated with relevant skills.
 Gig Economy and Freelancers: The rise of gig workers and freelancers poses a
challenge for traditional workforce management, necessitating flexible work
arrangements, contract management, and alternative compensation models.
 Employee Empowerment and Autonomy: Organizations are increasingly adopting
flatter hierarchies, where employees are empowered to make decisions and contribute to
innovation.

9. Globalization and Geopolitical Uncertainty:

 Navigating Trade Wars and Geopolitical Risks: Managers must be agile in navigating
complex global trade relationships, tariffs, and geopolitical tensions that impact supply
chains and market access.
 Localization vs. Globalization: Global companies face the challenge of maintaining a
unified corporate identity while localizing their strategies to meet regional demands and
comply with varying regulations.
 Cross-Cultural Competence: Global managers must develop cultural intelligence to
effectively lead diverse teams and understand the nuances of different markets.

10. Agile and Adaptive Management:

 Agile Project Management: In response to rapid market changes, organizations are
adopting agile project management methodologies to improve responsiveness and
flexibility.
 Continuous Innovation: Managers must foster a culture of continuous innovation,
encouraging experimentation and the development of new products or services to stay
ahead of competitors.
  Lean Operations: There is increasing pressure to streamline operations, reduce waste,
and become more efficient while maintaining high-quality standards.

11. Mental Health and Employee Well-Being:

 Addressing Mental Health: Mental health issues are on the rise, and managers are
expected to create supportive environments that promote mental well-being.
 Workplace Flexibility: Managers need to provide flexible work arrangements and
mental health resources, considering the growing importance of employee well-being in
organizational success.

12. Stakeholder Capitalism:

 Broader Business Accountability: Companies are being held accountable by a broader
group of stakeholders, including employees, customers, communities, and governments,
not just shareholders.
 Impact on Policy and Society: Organizations are increasingly expected to play a role in
addressing societal issues, such as inequality, healthcare access, and education,
influencing public policy, and creating positive social impact.