Characteristics of Management

Basic characteristics of management are:

1.Management is a goal-oriented process: An organisation has a set of basic goals which are
the basic reason for its existence. Management unites the efforts of different individuals in the
organisation towards achieving these goals.
2.Management is all pervasive: The activities involved in managing an enterprise are common
to all organisations whether economic, social or political.
3.Management is multidimensional: Management is a complex activity that has three main
dimensions:
1. Management of work: All organisations exist for the performance of some work.
Management translates this work in terms of goals to be achieved and assigns the
means to achieve it.
2. Management of people: Human resources or people are an organisation’s greatest
asset. Managing people has two dimensions:
1. it implies dealing with employees as individuals with diverse needs and behavior;
2. it also means dealing with individuals as a group of people
3. The task of management is to make people work towards achieving the organisation’s
goals, by making their strengths effective and their weaknesses irrelevant.
1.Management of operations: It requires a production process which entails the flow of
input material and the technology for transforming this input into the desired output for
consumption
2.Management is a continuous process: The process of management is a series of
continuous, composite, but separate functions (planning, organising, directing, staffing and
controlling). These functions are simultaneously performed by all managers all the time.
3.Management is a group activity: An organisation is a collection of diverse individuals
with different needs. Management should enable all its members to grow and develop as
needs and opportunities change
4.Management is a dynamic function: Management is a dynamic function and has to
adapt itself to the changing environment. In order to be successful, an organisation must
change itself and its goals according to the needs of the environment.
5.Management is an intangible force: Management is an intangible force that cannot be
seen but its presence can be felt in the way the organisation functions
FUNCTIONS OF MANAGEMENT
Planning
It is the basic function of management. It deals with chalking out a future
course of action & deciding in advance the most appropriate course of
actions for achievement of pre-determined goals.
According to KOONTZ, “Planning is deciding in advance - what to do, when to
do & how to do. It bridges the gap from where we are & where we want to be”. A
plan is a future course of actions. It is an exercise in problem solving & decision
making.
Planning is determination of courses of action to achieve desired goals. Thus,
planning is a systematic thinking about ways & means for accomplishment of
pre-determined goals. Planning is necessary to ensure proper utilization of
human & non-human resources. It is all pervasive, it is an intellectual activity
and it also helps in avoiding confusion, uncertainties, risks, wastages etc.
Organizing
It is the process of bringing together physical, financial and human
resources and developing productive relationship amongst them for
achievement of organizational goals.
According to Henry Fayol, “To organize a business is to provide it with everything
useful or its functioning i.e. raw material, tools, capital and personnel’s”. To
organize a business involves determining & providing human and non-human
resources to the organizational structure. Organizing as a process involves:
•Identification of activities.
•Classification of grouping of activities.
•Assignment of duties.
•Delegation of authority and creation of responsibility.
•Coordinating authority and responsibility relationships.
Staffing
It is the function of manning the organization structure and keeping it
manned. Staffing has assumed greater importance in the recent years
due to advancement of technology, increase in size of business,
complexity of human behavior etc.
The main purpose of staffing is to put right man/woman on right job
i.e. square pegs in square holes and round pegs in round holes.
According to Kootz & O’Donell, “Managerial function of staffing involves
manning the organization structure through proper and effective
selection, appraisal & development of personnel to fill the roles
designed un the structure”. Staffing involves:
•Manpower Planning (estimating man power in terms of searching,
choose the person and giving the right place).
•Recruitment, Selection & Placement.
•Training & Development.
•Remuneration.
•Performance Appraisal.
•Promotions & Transfer.
Directing
It is that part of managerial function which actuates the organizational methods
to work efficiently for achievement of organizational purposes. It is considered
life-spark of the enterprise which sets it in motion the action of people because
planning, organizing and staffing are the mere preparations for doing the work.
Direction is that inter-personnel aspect of management which deals directly with
influencing, guiding, supervising, motivating sub-ordinate for the achievement of
organizational goals. Direction has following elements:
•Supervision
•Motivation
•Leadership
•Communication
Supervision- implies overseeing the work of subordinates by their superiors. It is
the act of watching & directing work & workers.
Motivation- means inspiring, stimulating or encouraging the sub-ordinates with
zeal to work. Positive, negative, monetary, non-monetary incentives may be used
for this purpose.
Leadership- may be defined as a process by which manager guides and
influences the work of subordinates in desired direction.
Communications- is the process of passing information, experience, opinion etc
from one person to another. It is a bridge of understanding.
Controlling
It implies measurement of accomplishment against the standards and correction
of deviation if any to ensure achievement of organizational goals. The purpose of
controlling is to ensure that everything occurs in conformities with the standards.
An efficient system of control helps to predict deviations before they actually
occur.
According to Theo Haimann, “Controlling is the process of checking whether or
not proper progress is being made towards the objectives and goals and acting if
necessary, to correct any deviation”.
According to Koontz & O’Donell “Controlling is the measurement & correction of
performance activities of subordinates in order to make sure that the enterprise
objectives and plans desired to obtain them as being accomplished”. Therefore
controlling has following steps:
a.Establishment of standard performance.
b.Measurement of actual performance.
c.Comparison of actual performance with the standards and finding out
deviation if any.
d.Corrective action.
ROLE OF ENTRPRENEUR
Skills of manager
Types of Management Skills
According to American social and organizational psychologist Robert Katz, the three basic types
of management skills include:
1. Technical Skills
Technical skills involve skills that give the managers the ability and the knowledge to use a
variety of techniques to achieve their objectives. These skills not only involve operating
machines and software, production tools, and pieces of equipment but also the skills needed to
boost sales, design different types of products and services, and market the services and the
products.
2. Conceptual Skills
These involve the skills managers present in terms of the knowledge and ability for abstract
thinking and formulating ideas. The manager is able to see an entire concept, analyze and
diagnose a problem, and find creative solutions. This helps the manager to effectively predict
hurdles their department or the business as a whole may face.
3. Human or Interpersonal Skills
The human or the interpersonal skills are the skills that present the managers’ ability to
interact, work or relate effectively with people. These skills enable the managers to make
use of human potential in the company and motivate the employees for better results.
CHALLENGES OF MANAGEMENT

1.Uncertainty about the Future

2.Wellbeing of Employees
3.Tracking Team Productivity
4.Shaping Company Culture
5.Recruiting and Onboarding the Right Employees
6.Supporting Diversity & Inclusion in the Workplace
7.Managing Communication Between Teams
8.Regulation & Compliance
9.Technology & Digitalisation
10.Mind the Skills Gap
11.High Staff Turnover
12.Creating Innovative Teams
13.Knowledge Loss & Brain Drain
14.Finding the Holy Grail: Engagement
What Is Classical Theory Of Management?
During the industrial revolution, a number of large-scale organizations came into being with widespread
factory production. These organizations began looking for ways to drive employee productivity and
increase profits. This led to a spike in management ideas to streamline operations and motivate
employees to function better. The classical theory of management in organization, or the classical
organizational theory, was one such approach to management that emerged in the late 19th century and
gradually gained ground over the first half of the 20th century.
The classical organizational theory views an organization as a machine and employees as the various
parts of that machine. The classical approach to management focuses on centralized authority, labor
specialization and incentives to optimize productivity in an organization and, in turn, drive profits.
Workplaces are segregated into three levels of authority: business leaders or top-level management,
middle management and supervisors. Work is divided among individual workers who specialize in their
own distinctive fields.
Branches Of Classical Theory
Frederick W. Taylor, Henri Fayol and Max Weber were the three primary proponents of the classical theory of management.
Each of them highlighted specific principles and methods of organizational management, based on which three major branches of
the classical theory are commonly identified. Let’s look at these in detail:

. Scientific Management
Frederick W. Taylor is known as the father of scientific management. This branch of classical theory focuses on scientific
methods and empirical research to examine the most effective methods to accomplish specific tasks. It aims to extract the best
out of every employee by assigning jobs based on employee skill set and competency. Workflow is divided between managers
and employees. Managers strategize, train and monitor employees; employees perform their assigned roles.

Administrative Management
The main proponent of the administrative management branch of classical theory was Henri Fayol, a French industrialist.
Administrative management aims to improve organizational productivity by focusing on methods that managers can use to
synchronize internal processes. Fayol believed managerial practices are key to driving efficiency in organizations. Therefore, this
branch seeks to heighten managerial performance instead of individual worker efficiency.

Bureaucratic Management
The father of modern sociology, Max Weber, developed the branch called bureaucratic management. According to this branch
of classical theory, an ideal organization, or bureaucracy, has a hierarchical structure of management with clearly defined rules
and regulations. Labor is divided and relationships are impersonal. This ensures order and uniformity throughout an
organization, producing a specialized workforce.
What Is Neoclassical Theory?
As the name suggests, neoclassical consists of two parts: neo and classical. Neo means new, and
classical refers to the work done by a group of economists in the 18th and 19th centuries. In the
classical theory, management focus was on job content and physical resources. Classical
management theorists considered humans as an appendage to a machine. However, critics were
of the view that this theory lacks compassion toward people. The organizations working on this
principle are keeping emotional beings in the same category as machines.
With neoclassical organizational theory, theorists put forward incorporating behavioral sciences
into management to address the shortcomings of classical theory.
The essential features of the neoclassical approach of management are:
1.The Business Organization Is A Social System
2.The Human Factor Is The Most Critical Element In This Social System
3.Social And Psychological Factors Play A Crucial Role In Determining Productivity And
Employee Satisfaction
4.The Management Should Also Develop Social And Leadership Skills Apart From Technical
Skills. They Should Think More About The Welfare Of Workers
5.Productivity In An Organization Is Directly Related To Employee Morale.
Elton Mayo, Chester Barnard and Herbert Simon are some of the famous neoclassical theorists.
Two Movements In The Neoclassical Theory Of Management
The neoclassical organizational theory talks about ways and ideas that focus on the emotional beings of the
organization. There are two primary sources of the neoclassical theory of organization: the human relations
movement and the behavioral science approach.
The human relations movement regarded organization as a social system. Social physiologists and sociologists
put focus on group dynamics and promoted people-management skills in addition to technical skills.
The behavioral science approach considers human behavior in organizations and promotes the development of
human beings and its benefits at the individual and organizational levels.
Let’s take a look at how the work of these various sociologists and psychologists promoted neoclassical
organizational theory.
Human Relations Movement
This resulted from Elton Mayo and Fritz J. Roethlisberger’s Hawthorne studies. According to them, social and
psychological factors are important in determining worker productivity and satisfaction. The movement shows
that efficient leaders are employee-centric, democratic and follow a participative style.
Behavioral Movement
This had contributions from various sociologists and psychologists such as A.H. Maslow, Douglas McGregor,
Argyris, F. Herzberg, Rensis Likert, J.G. Likert, Kurt Lewin and Keith Davis. It is a more mature version of
human relation theory. The theory proposes ideas about how managers should behave to motivate the employees.
And the aim is to encourage employees to perform at the highest level and achieve organizational goals.
Elements Of Neoclassical Theory Of Management
There are three elements of neo-classical theory:
1.The Individual
2.The Neoclassical Theory Of Organization Emphasized Individual Differences Ignored Earlier In
The Classical Theory. Every Individual Has Emotions, Feelings, Hopes, Aspirations, And Expectations.
They Have Got Their Own Merit.
3.Work Groups
4.Workers Are Not Isolated But Part Of Certain Groups, Which Are Informal Organizations.
Management Must Integrate These Informal Organizations With The Formal Ones.
5.Participative Management
6.The Neoclassical Approach Of Management Suggests The Participation Of Workers In
Management.
7.As The Neoclassical Theory Is Employee-Oriented, Workers’ Participation In Planning Job Contents
And Operations Will Improve Productivity.
Criticism Of Neoclassical Theory Of Management
The following are the main criticisms of this theory:
•The Theory Is Merely An Extension Of Classical Theory With Human Insights
Attached To It
•The Theory Is Outdated As The Situational And Contingency Theories Address Its
Loopholes
•It Assumes Every Organization Runs By A Single Method Irrespective Of The
Environment
What Is The Modern Theory Of Management?
The Classical Management Theory asserts that only money motivates employees. That,
however, is an inadequate proposition, and the Modern Theory of Management came up in
response to it. According to the concept of modern management, employees are motivated
by several different factors.
It’s important to understand what is the modern theory of management in a larger sense.
The modern theory of organization uses mathematical analysis combined with an objective
understanding of the range of human emotions and motivation. A manager then can use
mathematics and statistics to gauge an employee’s motivation and measure their
performance. Essentially, it is about understanding what makes an employee tick.
Benefits Of Modern Theory Of Management
Here are the benefits of the modern theory of management:
1.Increases Productivity
2.The Different Theories Of Modern Management Educate Leaders On Maximizing The Value Of Their Human Resources. In Other Words,
Rather Than Spending Money On New Equipment Or A New Marketing Strategy, Businesses Should Focus On Training Their Employees.
3.Strengthens Decision-Making Abilities
4.When Evaluating An Organization Or A Department, Managers Can Use Modern Management Theories As A Guide. Managers Who Know
What To Look For Are Better Able To Spot Issues And Begin Formulating Solutions. They Can Also Use Mathematical Techniques To Help
Them Come To Final Decisions And Support Their Solutions.
5.Increases Employee Engagement
6.The Concept Of Modern Management Looks At Motivational Elements Other Than Money. Through This, Managers Can Identify And
Implement Processes That Take Into Account The Needs And Wants Of Their Employees. As A Result, Employees’ Morale And Engagement
Will Rise And They’ll Be More Likely To Stay On With The Organization.
7.Gives Managers An Objective View Of Things
8.Mathematics Plays A Vital Role In Modern Management Theory. Objective Data That’s Appropriately Analyzed Never Lies. On The Other
Hand, Using Personal Feelings To Make Decisions Can Backfire. Moreover, Managers Can Test A Variety Of Options To See Which One Best
Serves The Organization. As A Result, Managers Will Be Much More Equipped To Implement Efficient And Effective Solutions After Studying
The Modern Theory Of Management.
9.Increases Adaptability
10.Modern Management Theory Understands That Organizations Today Frequently Operate In Dynamic Environments. According To This
Theory, Managers Should Be Prepared To Use Various Methods And Approaches To Deal Effectively With Their Organizations’ Internal And
External Influences. New Technology And Statistical Modeling Can Be Used To Improve Processes And Develop Solutions, For Example.
These benefits have made this approach a popular practice for many organizations and their managers. Usually, a manager would apply one of
the three prominent types within their organization.
Types Of Modern Theory Of Management
There are three types of modern theories of management:
1.Quantitative Theory
2.Amid World War 2, Military Leaders From The United States And The United Kingdom
Assembled A Team Of Managers, Government Administrators And Scientists To Help Them
Determine How To Make The Most Efficient Use Of Available Resources. Experts Used Taylor
And Gantt’s Mathematical And Statistical Approaches From Various Fields To Solve These
Logistical Issues. Thus, The Quantitative Theory Of Management Was Developed.

3.In This Modern Theory Of Organization, Managerial Decision-Making Is Aided By The

Use Of Statistical Methods. However, This Concept Of Modern Management Isn’t Sufficient
To Run An Organization. A Humanistic Approach And An Understanding Of Human
Motivation Are Also Needed To Make The Best Use Of The Workforce.
1.Systems Theory
2.The Systems Theory Of Management Opens Up A New World For Managers And Gives Them
A New Management Approach. This Modern Theory Of Organization Proposes That A
Business Comprises Different Parts That Have To Work In Synergy To Perform Efficiently. Thus,
It Emphasizes Synergy And Interrelation Between The Various Limbs Of An Organization.
3.According To This Concept Of Modern Management, Having A Good Workforce Is Critical
To An Organization’s Success. All The Departments And Sub-Units Of An Organization Are
Crucial To Its Long-Term Viability And Growth. Managers In The Real World Are Expected To
Analyze Their Organization’s Patterns And Events To Figure Out The Best Management Strategy.
As A Result, They Can Work Together On A Variety Of Projects.
1.Contingency Theory
2.The Contingency Theory Of Management Says That No Single Management Strategy Works For Every
Organization. Instead, Many Internal And External Factors Have An Impact On The Management Strategy That’s
Ultimately Chosen. This Modern Theory Of Organization Believes That There Are Three Things At Play When
Figuring Out A Management Strategy: The Size Of An Organization, The Technology It Uses And The Leadership
Style.
Fred Fiedler developed this concept of modern management. According to Fiedler, leadership qualities are directly
linked to how well a leader manages their team. Every situation has its own set of leadership traits, according to
Fiedler’s theory. Furthermore, it implies that a leader must be agile enough to change with the times. It can be
summarized as follows:
•There Is No One-Size-Fits-All Approach To Running A Business
•A Leader Must Be Able To Quickly Determine Which Management Style Is Best Suited To A Given Situation
•The Least-Preferred Coworker Scale (LPC) Is The Foundation Of Fiedler’s Contingency Theory. LPC Is Used To
Evaluate A Manager’s Orientation
MHenry Fayol’s 14 Principles of Management
11. Division of Work
The first henry fayol principle of management is based on the theory that if an employee is given a
specific task to do, they will become more efficient and skilled in it. This is opposed to a multi-tasking
culture where an employee is given so many tasks to do at once. In order to implement this principle
effectively, look at the current skill sets of each employee and assign them a task that they can become
proficient at. This will help them to become more productive, skilled, and efficient in the long run.
2. Authority
This henry fayol principle of management states that a manager needs to have the necessary authority in
order to ensure that his instructions are carried out by the employees. If managers did not have any
authority, then they would lack the ability to get any work done. However, this authority should come
along with responsibility. According to Henri Fayol, there should be a balance between authority and
responsibility. If there is more authority than responsibility, the employees will get frustrated. If there is
more responsibility than authority, the manager will feel frustrated.
3. Discipline
This principle states that discipline is required for any organization to run effectively. In order to have
disciplined employees, managers need to build a culture of mutual respect. There should be a set of
organizational rules, philosophies, and structures in place that should be met by everyone. Bending rules
or slacking should not be allowed in any organization. In order to achieve this, there is a need for good
supervision and impartial judgment.

anagement
4. Unity of Command
This principle states that that should be a clear chain of command in the organization. The employees
should be clear on whose instructions to follow. According to Fayol, an employee should receive orders
from only one manager. If an employee works under two or more managers, then authority, discipline, and
stability are threatened. Moreover, this will cause a breakdown in management structure and cause
employees to burn out.
5. Unity of Direction
This henry fayol principle of management states that the work to be done should be organized in such a
way that employees work in harmony towards the same objective, using one plan, under the direction of
one manager. For example, if you have a range of marketing activities such as advertising, budgeting,
sales promotion, etc., there should be one manager using one plan for all the marketing activities. The
different activities can be broken down for different sub-managers, but they should all work towards a
common goal under the direction of one main person in charge of the whole thing.
6. Collective Interest Over Individual Interest
This principle states that the overall interest of the team should take precedence over
personal ones. The interest of the organization should not be sabotaged by the interest
of an individual. If anyone goes rogue, the organization will collapse.
7. Remuneration
This henry fayol principle of management states that employees should be paid fair
wages for the work that they carry out. Any organization that underpays its workers will
struggle to motivate and keep quality workers. This remuneration should include both
financial and non-financial incentives. Also, there should be a structure in place to
reward good performance to motivate employees.
8. Centralization
Centralization refers to the concentration of power in the hands of the authority and
following a top-bottom approach to management. In decentralization, this authority is
distributed to all levels of management. In a modern context, no organization can be
completely centralized or decentralized. Complete centralization means that people at
the bottom have no authority over their responsibilities. Similarly, complete
decentralization means that there will be no superior authority to control the
organization. To use this effectively today, there should be a balance of centralization
and decentralization. The degree to which this balance is achieved will differ from
organization to organization.
9. Scalar Chain
A scalar chain refers to a clear chain of communication between employees and their
superiors. Employees should know where they stand in the hierarchy of the
organization and who to go to in a chain of command. To implement this in the
workplace, Fayol suggests that there should be an organizational chart drawn out for
employees to see this structure clearly.
10. Order
This principle states that there should be an orderly placement of resources
(manpower, money, materials, etc.) in the right place at the right time. This ensures the
proper use of resources in a structured fashion. Misplacement of any of these resources
will lead to misuse and disorder in the organization.
11. Equity
Equity is a combination of kindness and justice. This principle states that managers
should use kindliness and justice towards everyone they manage. This creates loyalty
and devotion among the employees towards the organization they work for.
12. Stability of Tenure of Personnel
This principle states that an organization should work to minimize staff turnover and maximize
efficiency. Any new employee cannot be expected to get used to the culture of an organization
right away. They need to be given enough time to settle into their jobs to become efficient. Both
old and new employees should also be ensured job security because instability can lead to
inefficiency. There should also be a clear and effective method to handle vacancies when they
arise because it takes time and expense to train new ones.
13. Initiative
This principle states that all employees should be encouraged to show initiative. When
employees have a say as to how best they can do their job, they feel motivated and respected.
Organizations should listen to the concerns of their employees and encourage them to develop
and carry out plans for improvement.
14. Esprit de Corps
Esprit de Corps means “Team Spirit”. This henry fayol principle of management states that the
management should strive to create unity, morale, and co-operation among the employees. Team
spirit is a great source of strength in the organization. Happy and motivated employees are more
likely to be productive and efficient.