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COURSE 1 Management

1. The Concept of Management


The concept of management was imposed in the business sphere in 1941 through
the work The Managerial Revolution , published by James Burnham in New York,
where there was established the term of manager as vector of innovation and progress,
and the term of management with the significance of the analysis of the managers role
in the contemporary society [Pug-00].
The following list of definitions tries to create an understanding as complex as
possible of the management concept implication in the business specific terminology.
1.

Management [Ii-94] represents the process of coordination of the


material, human, financial, and informational resources of an organization
with a view to carry out its essential objectives (refer to Fig.1.1.).

2.

Management [Lar-00] represents the science of the enterprise


leadership and administration techniques.

3.

to manage [Engl-Rom dictionary] means to handle, to direct, to lead,


to administrate, to keep a tight hand over smth., to supervise.

4.

Management [Engl-Rom dictionary] leadership, administration, ability,


skill, tactical sense, orientation, direction.

5.

Manager [Engl-Rom dictionary] leader, executive, administrator, master


of the house.

MANAGEMENT

MATERIAL
resources

HUMAN
resources

FINANCIAL
resources

INFORM
ATIONAL
resources

The organization obj.


.
.
Fig.1.1 synthesizes the first definition of management.
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1.1

The evolution of modern management

The historical evolution of management


Certain procedures for the collective actions carrying out, certain control
instruments or empirical organizing forms based on intuition and experience are present
in millenary records. A certain form of planning diagram of bar- chart type was
discovered on a column of a temple in Luxor, Egypt (about 1 500 years B.C.) [Mor-94].
Although it is clear that anyone who has directed a number of activities, or the
raising of a building of a certain complexity, has resorted to certain planning, organizing
and control tools.
Along the evolution of mankind, management has become an ever complex
phenomenon. Management instruments under the form of a set of distinct procedures, i.e.
the management principles, originate however, almost entirely, in the 20th century.
In difficult and complex situations (e.g. the design of an organizing structure, the
development of a new production section, etc.), managers look for and identify principles
on the bases of which to evaluate the information, to elaborate decisions, respectively.
The historical evolution of management comprises 3 approaches deemed as
essential by some authors:

a. the classical approach


a.1. the scientific management
a.2. the classical organizational theory
b. the behavioral approach
c. the quantitative approach
a. the classical approach
a.1. the scientific management
The person with the greatest influence, leaving a true mark on the thinking and
science of management was Frederick Winslow Taylor (1856 1915), an American
mechanical engineer, who was called the father of scientific management.
Taylor has defined the principles of scientific management, that have been
subsequently adopted on a large scale, thus there being eliminated all the empirical
methods. Taylor was not the only author of his ideas as a whole, but he proved to be a
pragmatic person that had the ability to create a synthesis, as far as the work of others
was concerned, which he subsequently promoted, in an effective way, to a large audience
of managers from the industrial world.
The four principles defined by Taylor in his book The Principles of scientific
Management are as follows:
1. For every work task, there has to be developed a scientific alternative for its
carrying out that will replace the empirical methods (for the elimination of the
inefficient actions).
2. The employees shall be scientifically selected, then trained and perfected. In
former times, workers chose their work tasks by themselves and trained by
themselves as best as they knew.

3. There shall be developed an open (sincere) spirit of cooperation between


managers and workers to ensure the turning to account of the scientifically
elaborated procedures.
4. The division of labour between workers and managers shall be made in
proportional shares, each group taking over the responsibility of the tasks. The
managers shall take over all the tasks that they can execute better than the
workers (planning, organizing tasks, etc).

a.2. the classical organizational theory (the administrative


management)

Revisions and
modifications

Henry Fayol (1841- 1925), a French mine engineer, promoted the classical
organizational theory, defining the firm operational management functions and
principles in his work Administration Industrielle et Generale published in France
in 1916. The work was taken into consideration in Great Britain and in the United
States in 1949, being published by Pitman with the title General and Industrial
Management.
The functions of management, called by H. Fayol the elements of management are as
follows:
Prevision (forecasting and planning)
Organizing
Command
Leadership (Coordination)
Control
The functions of management are suggestively presented in figure 1.2 .

Planning (forecasting,
prevision, programming)

Organizing

Command

Leadership
(coordination)
Control
Fig.1.2 The functions of management
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1. Planning carries out a diagnosis analysis of the firm as function of the internal
and external circumstances, on the basis of which there is anticipated the
evolution of the firm, and there are established the variants of the objectives to be
achieved. There are established the variants of the firm functioning programmes
during a certain time interval, and finally there are obtained forecastings,
plannings, and operative programmes.
2. Organizing can be defined as a process of grouping of the means and methods for
the exploiting of the firm resources to achieve an objective in an effective and
efficient way.
3. Command specifies and determines the firms optimum course of action,
materialized in objectives, resources requirements, programmes and carrying out
ways for a certain period of time.
4. Leadership represents the influencing and supervising capacity of the employees
activities and behaviour to reach the firms objectives according to the provisions.
5. Control represents the process through which there are assessed the consequences
of the firms activities according to what had to be carried out, with a view to
observe the final parameters for the offered product/service, to integrate within
the planned time interval, and to intergrate within the planned budget.
Table 1.1 presents the 14 principles of the operational management promoted by H.
Fayol.
Table 1.1
Crt.
no.

1.
2.
3.

4.
5.

6.
7.

Principles

Description

Division of labour

The tasks individualization implies the increase of


efficiency, superior performances obtaining,
respectively
Equilibrium between
Each employee shall be delegated the required
authority responsibility
authority for the responsibilities carrying out.
Authority counterbalances responsibility.
Labour discipline
Employees shall observe the agreements
established between them and the organization
managers. Infractions of discipline shall be
correctly sanctioned.
Unity of control
Each employee shall receive orders from and shall
answer to only one person superior in rank.
Unity of direction
All the organizational activities that follow up the
same objective shall be grouped and directed by a
single manager according to a plan previously
elaborated.
The priority of the group Individual interests shall be subordinated to those
interest as compared to the specific for the organization.
individual interest
The material reward of the The employees shall be paid in accordance with
employees
the services done.

8,

Centralization

9.

The hierarchical chain

10.

Order

11.

Equity

12.

Personnel stability

13.

Initiative

14.

The spirit of a body

Since authority has to be delegated proportionally


with the responsibility, the former shall tend to
concentrate at the superior level of the
organization.
The direction of authority exerting shall start from
the superior level of management towards the last
level of employees. Communication along this
chain shall be propagated through the
management links.
Each employee shall have the proper position, and
each object shall be at the proper place at the
proper moment.
Managers shall be fair, honest and benevolent
with the employees.
Employees fidelity shall be cultivated, on account
of the fact that high employees fluctuation implies
efficiency lowering.
Employees shall be encouraged to make
themselves conspicuous through own solutions
and reasonings within the limits of the authority
that has been delegated to them and of the
provisions of their positions.
The cultivation of the team spirit will lead to
efficiency and harmony.