UNIT-I

Management

Management can be defined as a process of getting the work or the task done that is required for
achieving the goals of an organization in an efficient and effective manner.

Process implies the functions of the management. That is, planning, organizing, staffing,
directing and controlling. On the other hand, effective implies completing the given task and
work while, efficient means successfully completing the task with minimum possible cost.

Thus, management can be defined as the process of planning, organizing, staffing, directing and
controlling such that the goals of the organization are achieved successfully with minimum cost
and resources.

Management is Science or Art

The term management is used in various senses. Some consider it as an activity, some treat it
as a group, and some call it a discipline, whereas some look at it as a process. Management as
an activity is getting things done through others. Management as a group is all those who
manage. Management as a discipline is a body of knowledge, and as a process is what
managers do. We define management as the process of getting things done through and with
people to achieve a common goal effectively and efficiently. The nature of management can be
analyzed in the terms of science, arts, and profession.

It is considered a science because it has an organized body of knowledge containing certain

universal truths. It is called an art because managing requires certain skills which are personal
possessions of managers.
Management as a Science

Science means a systematized body of knowledge that can be acquired through observation and
experimentation. It consists of universally accepted principles that establish a relationship
between causes and their effects.

The essential features of Science are:

• Systematized body of knowledge: Science is a systematic body of knowledge. Its

principles are based on a cause-and-effect relationship.
• Observation and Experiments: All scientific principles are first developed through
observations and then tested through repeated experimentation under controlled conditions.
• Causes and Effect Relationship: Science is based on causes and their effects. For
example, if a person eats lots of fast food without any physical activity, he will put on extra
weight.
• Universal Validity: Scientific principles have universal validity and can be applied in all
situations and times.

We can say management has some features of Science as:

1. Management is a systematized body of knowledge in the form of basic principles and

concepts. It not only has theories and principles that have developed over time, but it also
draws on other disciplines, such as Economics, Sociology, Psychology, and Mathematics.
Like all other organized activities, management has its vocabulary of terms and concepts.
2. The knowledge of management has been built up through endless observation and
experiments. Management experts and practitioners have developed the knowledge after
 thorough analysis, inquiry and experience. The principles of management make use of the
scientific method of observation and analysis. As management deals with human behaviors
that cannot be scientifically predicted, the methods of observation used in management are
not completely objective.
3. Principles of management establish a cause-and-effect relationship between various factors.
If there is a cause or an action, there will be an effect due to that cause. For example, dual
subordination leads to confusion.
4. Principle of management is not applicable universally as they are not exactly like the
principles of science; only the fundamental principles of management are universally
applicable. These results can be tested and verified. The principle of management is
modified as per the situation. However, managers are provided with certain fundamental
techniques that are used in different situations.
Therefore, management is a science. It can
be said that management is a social science because it deals with people and their behavior.

Management as an Art
An art means the practical application of knowledge and skills to achieve the desired results. It
is personal application of knowledge to achieve results. It is attained through study,
observation and experience.

The essentials features of arts are:

• Theoretical knowledge: Art comprises the application of theoretical knowledge. A

particular art has its basic principles and theory. Some fundamental principles have been
derived by the experts which apply to their particular form of art. For example, painting has
its principles and theory to start with.
• Personal skills: Every artist has his way of working. The use of basic knowledge varies
from individual to individual. Even how they tackle their problems for reaching the result
or the goal which they are willing to achieve differs. Applying this basic knowledge with
practice, creativity, imagination, initiative, and innovation is a personal skill.
• Creativity: Art consists of lots of creativity. The theoretical knowledge should be
practiced and applied differently to become more creative and achieve the ultimate goal.
• Perfection through Practice: As arts require nonstop practice to gain mastery. By
performing the task again and again, the artists gain perfection through practise. For
example, a dancer who practices for hours daily will get smooth and perfect with his steps
through practice.
We can say management has some features of arts as :

1. There are many texts available in forms of theoretical knowledge for different areas of
management, like marketing, finance, and human resources, in which the manager has to
specialize. A manager practices the art of management in his everyday job of managing a
business based on these studies, observations and experience.
2. Every manager has his unique method of working. He tackles various problems based on
his own opinion and understanding of the situation. There are many theories of
management introduced by various management thinkers, which define certain universal
principles. A manager applies these universal principles and theoretical knowledge in
different situations and problems. So, management is an individual skill.
3. Management is creative, as it converts inputs into outputs. A manager applies this attained
knowledge in his personal and skillful way in the realities of a given situation.
Management is goal-oriented and result-oriented. It aims at achieving ultimate productivity
and profitability, i.e. at the lowest cost.
4. Management also involves regular practice. An efficient manager can convert a challenge
into an opportunity through unceasing decision-making and leadership. Most management
practices rely on the same set of principles and theories. The distinction between a
successful and a less successful manager is his ability to put these principles into practice.
Therefore, management is an art.

Entrepreneur vs Manager
The key difference between an entrepreneur and a manager is their standing in the company. An
entrepreneur is a visionary that converts an idea into a business. He is the owner of the business,
so he bears all the financial and other risks. A manager, on the other hand, is an employee, he
works for a salary.
Manager
A manager is a person who feels a sense of ownership over a specific piece of an organization,
and deal with the organization. Heads are in charge of various divisions and the people who
work in them. The administrator is in charge of the entire operation. A 'display area director,' for
example, is in charge of the entire display area.

Administrative capabilities are primarily used by supervisors in organizations to carry out their
duties. They have the authority to hire, fire, maintain discipline, provide execution evaluations,
and screen participation. They should also support additional time work for the representatives
and approve their excursions.

Entrepreneur
The term entrepreneur refers to financial experts, while the term business venture refers to an
interaction. The interaction is called a business venture when a financial specialist transforms
their thoughts into an effective organization. This umbrella term refers to their consistent effort,
their gamble, and how they maintain the business, and then transform it into an effective
venture.
Types of Managers

The 4 types of managers

1. Top-level managers

The top level of management in an organization is typically composed of the CEO, CFO, and
COO. These individuals are responsible for the long-term success of the company and make
decisions that affect the whole organization. They sit at the top of a company’s hierarchy.

The Chief Executive Officer (CEO) is the highest-ranking manager and is responsible for setting
the overall direction of the company.

The Chief Financial Officer (CFO) oversees financial matters and develops strategies to ensure
the financial health of the organization.

The Chief Operating Officer (COO) is responsible for operational matters and ensuring that day-
to-day operations are running smoothly. Together, these three top executives form the core of the
management team and are responsible for making decisions that will shape the future of the
organization.

2. Middle managers

Middle managers play an essential role in any organization. They are the link between top-level
management and front-line staff, responsible for ensuring that initiatives are executed and that
team members have the guidance and support they need to be successful.

Middle managers typically have titles such as department head, director, or chief supervisor.
They serve as communication points between first-line management and top-level management.,
helping to ensure that communication flows smoothly and that everyone is on the same page.

In addition to their communication duties, middle managers also help teams execute initiatives,
and provide guidance and influence for both top manager orders and first-line managers in
assisting their staff.
Without middle managers, organizations would struggle to achieve their goals. These important
leaders help to keep everyone focused and motivated, while also making sure that tasks are
completed efficiently and effectively. If you’re looking to move up in your career, developing
your skills as a middle manager is a great way to do it.

3. First-line managers

First-line managers are responsible for making sure that the organization’s plans are put into
action. They occupy an entry-level management position and are often the first to see problems
with the operation of a business. As such, they play an important role in keeping businesses
running smoothly. They usually have job titles like shift managers, assistant managers, or office
managers.

First-line managers are responsible for a wide range of tasks, including supervising staff,
monitoring operations, solving problems, and implementing changes. They may also be
responsible for training and development, budgeting, and communication. Because they are
typically at the front line of a business, first-line managers play a vital role in its success or
failure.

4. Team leaders

A team leader is someone who is appointed to manage a particular task or activity. The team
leader is responsible for overseeing all the parts of their assignment. This includes making sure
that all the members of the team are aware of their roles and responsibilities, and that they are
working together to achieve the desired outcome.
Evolution of Management Theory

Evolution of Management Theory is the ways to organize and classify the voluminous
information about management that has been collected and disseminated. These attempts at
classification have resulted in the identification of management approaches. The approaches of
management are theoretical frameworks for the study of leadership. Each of the
management approaches is based on somewhat different assumptions about human
beings and the organizations for which they work.

The following different approaches of management are:

1. The Classical Approach
2. The Behavioral Approach
3. The Quantitative Approach
4. Systems Approach
5. Contingency Approach
The formal study of management is largely a twentieth-century phenomenon, and to some
degree, the relatively large number of management approaches reflects a lack of consensus
among management scholars about basic questions of theory and practice.

I.The Classical Approach

The classical approach is the oldest formal approach of management thought. Its roots
pre-date the twentieth century. The classical approach of thought generally concerns
ways to manage work and organizations more efficiently. Three areas of study that can be
grouped under the classical approach are:
1. Scientific Management
2. Administrative Management
3. Bureaucratic Management
II. The Behavioral Approach

The behavioral approach of management thought developed, in part, because of

perceived weaknesses in the assumptions of the classical approach. The classical
approach emphasized efficiency, process, and principles. Some felt that this emphasis
disregarded important aspects of organizational life, particularly as it related to human
behavior. Thus, the behavioral approach focused on trying to understand the factors that
affect human behavior at work.
1. Human Relations
2. Behavioral Science

III. The Quantitative Approach

The quantitative approach focuses on improving decision-making via the application of

quantitative techniques. Its roots can be traced back to scientific management.

• Management Science (Operations Research)

• Production and Operations Management

Both the approaches are as follows:-

A. Management Science (Operations Research)

Management science (also called operations research) uses mathematical and statistical
approaches to solve management problems. It developed during World War II as
strategists tried to apply scientific knowledge and methods to the complex problems of
war.

The industry began to apply management science after the war. The advent of the
computer made many management science tools and concepts more practical for
industry.
B. Production and Operations Management

This approach focuses on the operation and control of the production process that transforms
resources into finished goods and services. It has its roots in scientific management but became
an identifiable area of management study after World War II.

It uses many of the tools of management science. Operations management emphasizes the
productivity and quality of both manufacturing and service organizations. W. Edwards Deming
exerted a tremendous influence in shaping modern ideas about improving productivity and
quality.

Major areas of study within operations management include capacity planning, facilities
location, facilities layout, materials requirement planning, scheduling, purchasing and inventory
control, quality control, computer-integrated manufacturing, just–in–time inventory systems, and
flexible manufacturing systems.

IV. Systems Approach

The systems approach focuses on understanding the organization as an open system that
transforms inputs into outputs. The systems approach began to have a strong impact on
management thought in the 1960s as a way of thinking about managing techniques that would
allow managers to relate different specialties and parts of the company to one another, as well as
to external environmental factors.

The systems approach focuses on the organization as a whole, its interaction with the
environment, and its need to achieve equilibrium.

V. Contingency Approach

The contingency approach focuses on applying management principles and processes as dictated
by the unique characteristics of each situation. It emphasizes that there is no one best way to
manage and that it depends on various situational factors, such as the external environment,
technology, organizational characteristics, characteristics of the manager, and characteristics of
the subordinates.
Contingency theorists often implicitly or explicitly criticize the classical approach for its
emphasis on the universality of management principles; however, most classical writers
recognized the need to consider aspects of the situation when applying management principles.

Forms of Business Organization

An organization engaged in some commercial activity or business with the motive of earning
profit is known as a business enterprise. If an individual or a group of individuals plans to start a
new business or expand its existing business, selecting the right form of business organization is
essential for them. There are five different forms of business organization from which one can
select the best option for them. These are Sole Proprietorship, Joint Hindu Family Business,
Partnership, Cooperative Societies and Joint Stock Companies. For selecting the most
appropriate form of business organization, one has to weigh every merit and demerit of each
form of an organization against their requirements.

Sole Proprietorship
A popular form of business organization in which the business is owned, managed, and
controlled by an individual is known as a sole proprietorship. This individual is the recipient of
every profit and loss of the business and bears every risk coming to the business. Here, the
word sole means only and proprietor means owner; hence, the only owner of the business.
Usually, businesses with personalized services like hair salons, beauty parlours, retail shops,
etc., run under sole proprietorship. In this form of business, the owner is not separate from the
business; hence, no separate legal entity. Besides, the owner does not have to perform any
legal formality and can start the business whenever they want.

Joint Hindu Family Business

A form of business organization found only in India in which the business is owned and carried
on by the HUF(Hindu Undivided Family) members is known as Joint Hindu Family Business.
It is one of the oldest forms of business organization in India. This form is governed by the
‘Hindu Law’. The eldest member and head of the family, also known as “Karta,” controls the
business. Membership in this form of business organization is based on the birth in a specific
family. The three successive members of the family can be the members of the business. Every
member of the business have equal right and ownership over their ancestor’s property, and
these members are known as ‘co-parceners.’ The two conditions for the existence of a Joint
Hindu Family Business are: there must be some ancestral property, and a minimum of two
male members must be in the family.

Partnership
The most crucial disadvantage of a sole proprietorship is the lack of enough financing in the
business, which is resolved in this form of business organization. According to the Indian
Partnership Act, 1932, a partnership is a form of business organization in which there is a
relation between two or more people with an agreement to share the firm’s profits carried on
by every partner or any one of the partners acting for all. It solves the need to acquire greater
capital investment, risk-sharing, and a variety of skills in the business, which is not available in
Sole Proprietorship and Joint Hindu Family Business. The minimum number of partners
required in a partnership firm is two. There are different types of partners and partnerships in
this form of business organization.

Cooperative Society
A voluntary association of people joining together with the main objective of members’
welfare is known as a cooperative society. As the name suggests, people in this form of
business organization work together and with other people for the accomplishment of a
common purpose. The power to make decisions in a Cooperative Society is in the hands of an
elected managing committee. The Cooperative Societies Act, of 1912 states that it is
compulsory to register a Cooperative Society. Setting up and forming this form of business
organization requires the consent of at-least ten adult people. The capital for the business is
raised by its members through the issue of shares. After the registration of the Cooperative
Society is complete, it acquires a separate legal identity in the market. There are different types
of cooperative societies categorized on the basis of their nature of operations.

Joint Stock Company

An association of different individuals formed to carry out business activities is known as a
joint stock company. This form of organization has an independent legal status from its
members. Basically, a joint stock company is an artificial individual with a separate legal
entity, common seal and perpetual succession. The Joint Stock Company form of organization
is governed by the Companies Act, 2013. The shareholders of the company are its owners;
however, the Board of Directors is elected by the shareholders and is the chief managing body
of the company. Usually, the shareholders or the owners of the company have indirect control
over its operations. A company can be either private or a public company.

THE ORGANIZATION’S CULTURE

Organizational Culture

A system of shared meanings and common beliefs held by organizational members that
determines, in a large degree, how they act towards each other.
“The way we do things around here.”
Values, symbols, rituals, myths, and practices
Implications:
• Culture is a perception.
• Culture is shared.
• Culture is descriptive
Sources of Organizational Culture
• The organization’s founder
- Vision and mission
• Past practices of the organization
- The way things have been done
• The behavior of top management
• Continuation of the Organizational Culture
- Recruitment of like-minded employees who “fit”
-Socialization of new employees to help them adapt to the culture

Difference between Strong and Weak culture

Organization Culture
Organization Environment