CHAPTER 1

Objectives of the chapter

 Understanding management concepts
 Characteristics of management
 Functions of management
MANAGEMENT
 Management is the attainment of organizational goals in
an effective and efficient manner through planning,
organizing, staffing, directing and controlling
organizational resources.
 Organizational resources include men(human beings),
money, machines and materials.
Definitions
 Louis E Boone & David L Kurtz- The use of people and
other resources to accomplish objectives.
 Mary Parker Follet- the act of getting things done through
people.
 Frederick Taylor defines Management as the art of
knowing what you want to do in the best and cheapest way.
Characteristics
 Management is a distinct process.
 Management is an organized activity
 Management aims at the accomplishment of
predetermined objectives.
 Management is both a science and an art.
 Management is a group activity
 Management principles are universal in nature
 Management integrates human and other resources.
Concept of management-
Raymond G. Leon
 Management by Communication
 Management by Systems
 Management by Results
 Management by Participation
 Management by Motivation
 Management by Exception
 Management by Objectives
Steps in MBO
 To establish long-term and short-tem organizational goals
 To establish long-term and short-term objectives for each
manager, clarifying the key performance standards
 Periodic review of performance
 Encouraging managers to accept responsibility
Benefits of MBO
 The need for planning will be recognized
 It provides for objectives and accountability for
performance
 It encourages participative management
 It helps in job enrichment
 It provides for a good feedback system
FEATURES
 Management involves five functions
 These functions are organised to achieve organisational
goals.
 Management involves effective and efficient use of
resources
FUNCTIONS OF MANAGEMENT
 PLANNING
 ORGANIZING
 STAFFING
 DIRECTING
 CONTROLLING
PLANNING

• Planning is determining the objectives and formulating

the methods to achieve them. It is more simply said than
done. A job well planned is half done. During planning
one needs to ask oneself the following:
• What am I trying to accomplish i.e. what is my objective?
• What resources do I have and do I need to accomplish the
same?
• What are the methods and means to achieve the
objectives?
• Is this the optimal path?
 Types of Planning
• Purposes or missions,
• Objectives-It is the ultimate goal towards which the activities of the
organization are directed
• Strategies-general program of action and deployment of resources
• Policies-general statement or understanding which guide or channel
thinking in decision making
• Procedures-states a series of related steps or tasks to be performed in
a sequential way
• Rules-prescribes a course of action and explicitly states what is to be
done
• Programs-comprehensive plan that includes future use of different
resources
• Budgets-statement of expected results expressed in numerical terms
Principles of Planning
 Take Time to Plan
 Planning can be Top to Down or Bottom to Top
 Involve and Communicate with all those Concerned
 Plans must be Flexible and Dynamic
 Evaluate and Revise
Steps in Planning
1. Determining the goals or objectives for the entire
organization.
2. Making assumptions on various elements of the
environment.
3. To decide the planning period.
4. Examine alternative courses of actions.
5. Evaluating the alternatives.
6. Real point of decision making
7. To make derivative plans.
Types of Managerial Decisions:
 Programmed
 Non programmed.
 Mechanistic-It is one that is routine and repetitive in
nature
 Analytical-It involves a problem with a larger number of
decision variables
 Judgmental-It involves a problem with a limited number of
decision variables, but the outcomes of decision
alternatives are unknown
 Adaptive-It involves a problem with a large number of
decision variables, where outcomes are not predictable
Process of Organizing
 Determine what is to be done/ Division of Work:
 Assign Tasks: Departmentalization:
 Link Departments: Hierarchy Development:
 Decide how much Authority to Designate/ Authority,
Responsibility and Delegation:
 Decide the Levels at which Decisions are to be made /
Centralization vs. Decentralization:
 Decide how to Achieve Coordination:
Techniques for achieving
coordination.
 Coordination by Rules or Procedures
 Coordination by Targets or Goals:
 Coordination through the Hierarchy
 Coordination through Departmentalization
 Using a Staff Assistant for Coordination:
 Using a Liaison for Coordination:
 Using a Committee for Coordination
 Using Independent Integrators for Coordination:
 Coordination through Mutual Adjustment:
STAFFING
Definition 1
 Selecting and training individuals for specific job
functions, and charging them with the associated
responsibilities.
Definition 2
 Number of employed personnel in an organization or
program. Also called workforce.
DIRECTING/LEADING
 Provides positive and dynamic leadership
 Provides maximum opportunities
 Provides proper motivation of personnel
 Ability to command people
Controlling as a Management
Function
 Controlling
 A process of monitoring performance and taking action
to ensure desired results.
 It sees to it that the right things happen, in the right
ways, and at the right time.

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Controlling as a Management
Function
 Controlling
 Done well, it ensures that the overall directions of
individuals and groups are consistent with short and
long range plans.
 It helps ensure that objectives and accomplishments are
consistent with one another throughout an
organization.

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Controlling as a Management
Function
 Controlling
 It helps maintain compliance with essential
organizational rules and policies.

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The Control Process
 Establish objectives and standards.
 Measure actual performance.
 Compare results with objectives and standards.
 Take necessary action.

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Establish Objectives and
Standards
 The control process begins with planning and the
establishment of performance objectives.
 Performance objectives are defined and the standards
for measuring them are set.

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Establish Objectives and
Standards
 There are two types of standards:
 Output Standards - measures performance results in
terms of quantity, quality, cost, or time.
 Input Standards - measures work efforts that go into a
performance task.

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Measuring Actual Performance
 Measurements must be accurate enough to spot
deviations or variances between what really occurs
and what is most desired.
 Without measurement, effective control is not
possible.

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Comparing Results with
Objectives and Standards

 The comparison of actual performance with

desired performance establishes the need for
action.
 Ways of making such comparisons include:
 Historical / Relative / Engineering
 Benchmarking

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Taking Corrective Action

 Taking any action necessary to correct or

improve things.
 Management-by-Exception focuses managerial
attention on substantial differences between
actual and desired performance.

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Taking Corrective Action
 Management-by Exception can save the managers
time, energy, and other resources, and concentrates
efforts on areas showing the greatest need.
 There are two types of exceptions:
 Problems - below standard
 Opportunities - above standard

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Effective Controls
The Best Controls in Organizations
are
 Strategic and results oriented
 Understandable
 Encourage self-control

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Effective Controls
The Best Controls in Organizations are
 Timely and exception oriented
 Positive in nature
 Fair and objective
 Flexible

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Types of Control
 Preliminary
Sometimes called the feedforward controls, they
are accomplished before a work activity begins.
They make sure that proper directions are set and
that the right resources are available to accomplish
them.

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Types of Control
 Concurrent
Focus on what happens during the work process.
Sometimes called steering controls, they monitor
ongoing operations and activities to make sure that
things are being done correctly.

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Types of Control
 Postaction
Sometimes called feedback controls, they take place
after an action is completed. They focus on end
results, as opposed to inputs and activities.

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Types of Controls
Managers have two broad options with respect to
control.
 They can rely on people to exercise self-control
(internal) over their own behavior.
 Alternatively, managers can take direct action
(external) to control the behavior of others.

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Types of Control
 Internal Controls
Allows motivated individuals to exercise self-control
in fulfilling job expectations.
The potential for self-control is enhanced when
capable people have clear performance
objectives and proper resource support.

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Types of Control
 External Controls
It occurs through personal supervision and the
use of formal administrative systems.
 Performance appraisal systems, compensation and
benefit systems, employee discipline systems, and
management-by-objectives.

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Organizational Control Systems
 Management Processes
 Strategy and objectives
 Policies and procedures
 Selection and training
 Performance appraisal
 Job design and work structures
 Performance modeling, norms, and organization culture

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Organizational Control Systems
 Compensation and Benefits
 Attract talented people and retain them.
 Motivate people to exert maximum effort in their
work.
 Recognize the value of their performance
contributions.

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Organizational Control Systems
 Employee Discipline
 Discipline is defined as influencing behavior through
reprimand.
 Progressive Discipline ties reprimand to the severity
and frequency of the employee’s infractions.
 Positive Discipline tries to involve people more
positively and directly in making decisions to improve
their behavior.

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The “Hot Stove Rule”
To be Effective Discipline Should be:
 Immediate  Informative
 Focus on activity not  Occur in a
personality supportive setting
 Consistent  Support realistic
rules

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Organizational Control Systems
 Information and Financial
 Activity-based costing - the true cost of all products
and services.
 Economic value added - examine the value added by
all activities.
 Understand the implication of key financial
measures of (ratios) organizational performance

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Operations Management and
Control
 Purchasing
 Economic Order Quantity
automatic reorder points

 Just-In-Time Scheduling

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Operations Management and
Control
 Project Management
 Program Evaluation and Review Technique (PERT) -
Identifies and controls the many separate events in
complex projects.

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Operations Management and
Control
 Statistical Quality Control
 Based on the establishment of upper and lower
control limits, that can be graphically and
statistically monitored to ensure that products meet
standards.

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MANAGERIAL SKILLS

CONCEPTUAL

HUMAN

TECHNI
CAL
TECHNICAL SKILLS
A persons’ knowledge and ability to make effective use of any
process or technique constitutes his technical skills.
For eg: Engineer, accountant, data entry operator, lawyer,
doctor etc.
HUMAN SKILLS
An individuals’ ability to cooperate with other members of
the organization and work effectively in teams.
For eg: Interpersonal relationships, solving people’s problem
and acceptance of other employees.
CONCEPTUAL SKILLS
Ability of an individual to analyze complex situations and to
rationally process and interpret available information.
For eg: Idea generation and analytical process of information.
MANAGER’S ROLES
 Interpersonal role
 Informational role
 Decisional role
INTERPERSONAL ROLE
 Figurehead- ethical guidelines and the principles of
behavior employees are to follow in their dealings with
customers and suppliers
 Leader- give direct commands and orders to subordinates
and make decisions
 Liaison-coordinate between different departments and
establish alliances between different organizations
INFORMATIONAL ROLE
 Monitor- evaluate the performance of managers in
different functions
 Disseminator-communicate to employees the
organization’s vision and purpose
 Spokesperson- give a speech to inform the local community
about the organization’s future intentions
DECISIONAL ROLE
 Entrepreneur- commit organization resources to develop
innovative goods and services
 Disturbance handler- to take corrective action to deal with
unexpected problems facing the organization from the
external as well as internal environment
 Resource allocator- allocate existing resources among
different functions and departments
 Negotiator- work with suppliers, distributors and labor
unions
TYPES OF MANAGERS
 FIRST-LINE MANAGERS- often called supervisors stand at
the base of the managerial hierarchy
 MIDDLE MANAGERS- heads of various departments and
organise human and other resources to achieve
organizational goals
 TOP MANAGERS- set organizational goals, strategies to
implement them and make decisions
WHAT MAKE MANAGERS
SUCCESSFUL?
 Hard work
 Smart work
 Patience
 Out of box thinking
 Reading and acquiring knowledge
 Ethical consciousness
 Collaborative relationship
 Perseverance
Thank you