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Principles and Practices of Management ADL
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Principles and Practices of
Management
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Amity Center for eLearning
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ADL 01

Amity University

Principles and Practices of Management ADL
01

Contents
Chapter 1: Managers and management
i.

Introduction: Managers and management

ii.

What is an organization?

iii.

Why do organizations exist?

iv.

The nature of Management

v.

What is management?

vi.

Who are managers?

vii.

Management Functions

viii.

Management process

ix.

Managerial Roles

x.

Managerial skills

xi.

Levels of Management

xii.

Schools of management thought

Chapter 2: Management planning process
i.

Introduction: Planning

ii.

Origin and Definition

iii.

Why should managers plan?-Advantages

iv.

Approaches to planning

v.

Characteristics of Planning

vi.

Types of plans

vii.

Contemporary issues in planning

viii.

Forecasting and techniques in forecasting

Chapter 3: Organizing
i.

Introduction- Organizing

ii.

What is organizing?

Principles and Practices of Management ADL
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iii.

Defining organization structure

iv.

Features of an effective organization structure

v.

Organization as a process

vi.

Principles of organizing

vii.

Departmentation

viii.

Span of control

ix.

Authority and delegation of authority

Chapter 4: Staffing
i.

Meaning of Staffing

ii.

Nature of Staffing Function

iii.

Elements of staffing process

iv.

Human Resource Planning or Manpower Planning

v.

Job Analysis

vi.

Recruitment and selection

vii.

Training and Development

viii.

Performance Appraisals

ix.

Promotion and transfer

Chapter 5 : Direction
i.

What is direction?

ii.

Features of directing

iii.

Importance of directing

iv.

Principles of direction

v.

Elements of direction

vi.

Decision making

vii.

Characteristics of decision-making

viii.

Types of decisions

Need for co-ordination v.Principles and Practices of Management ADL 01 ix. Kinds of control . Process of Controlling xiv. The elements of control xii. Importance of motivation xiv. Hindrances to co-ordination ix. Relationship between the elements of control and information xiii. Techniques of co-ordination vi. Importance of co-ordination viii. Motivation xiii. Motivation process xv. Types of co-ordination vii. Management by objective-concepts and features xi.Process xii. Meaning of control x. Communication. Theories of motivation Chapter 6 – Co-ordination and Controlling i. Principles of co-ordination iv. Introduction-co ordination ii. Definitions iii. The decision-making process x. Characteristics of Control xi.

The chapter six first describes coordinating and then controlling. Coordination is the integration of several parts into an orderly whole to achieve the purpose of undertaking and Controlling is the process of comparing actual performance with standards . It covers management theory and practice. Successful managers deal with foreseen problems. It would enable the student to gain access to relevant information through the internet. so that organizational plans and decisions can be made and carried out effectively. and evolving theories. Organizing is important to managers because it is the means which they use to align work with resources. Chapter five discusses directing. Without management. The organization of this book is made according to the functions of management. Chapter two discuss planning functions in detail. Managers are the ‗coordinators‘ in the organization. The chapter three explores the organizational context in which managers operate. The difference lies in planning. everchanging procedures and practices in the field of management in a logical manner. as it satisfies the requirements of students to gain basic knowledge of the field of ‗management‘.Principles and Practices of Management ADL 01 Preface This book Principles and Practice in management is an attempt to design a comprehensive introduction to the study of management. The subject matter is presented in a simple. Staffing is the process of attracting. coordinating efforts. money and material. basic concepts. Every attempt has been made to maintain easy readability and quick comprehension. and unsuccessful manager‘s struggle with unforeseen problems. websites and video references to benefit of readers interested in exploring the topics further. Direction is telling people what to do and seeing that they do it to the best of their ability. In Chapter four. an organization is merely a collection of men. In its absence. the resources of production remain resources and never become production. latest techniques. In fact the most important duties of human resource managers are to help the organization reach its goals through effective and efficient utilization of human resources. They are the individuals charged with examining the workflow. Further. evaluating and compensating individuals at work. concise and interesting style. machines. Chapter one of the book examines managers and management. developing. emerging ideas. It is primarily a student-oriented textbook. each of the elements in the staffing process is discussed in detail. meeting goals and providing leadership. we will first define the basic human resource management functions. The book is supported by references from books. The text offers a rich fund of contemporary knowledge.

What is an organization? iii.Principles and Practices of Management ADL 01 and taking necessary corrective action. What is an organization? . A reading would definitely enhance student domain knowledge in management practice. Managerial Roles x. They play a vital role in efficient and effective utilization of resources. Why do organizations exist? iv. What is management? vi. Levels of Management xii. Who are managers? vii. Schools of management thought Managers are indispensable part of organizations. Management process ix. Management Functions viii. The nature of Management v. Introduction: Managers and management ii. Managerial skills xi. This chapter intends to help you understand the basic concepts and theories of management and describes those skills and role set that makes it to become an effective manager. Chapter 1 Managers and management Chapter outline i. They work with and through people to accomplish the organizational tasks. For any organization to sustain with competitive advantage it needs managers.

a need to adapt their environments. In addition to adaptation need all societies have values and goals. Thirdly. ―a consciously coordinated social unit. It gave rise for production organizations. Secondly it is composed of people.Principles and Practices of Management ADL 01 Managers work in organizations. it is consciously created for the people. These organizations came into existence to produce all the goods the society consumes. It is goal achievement need and political organizations came into . In the words of Peter Drucker. Firstly. All societies have. and the ongoing training so that they can perform and respond to change. for example. which allow coordination of work through formal structures. Why do organizations exist? Organizations came into existence for satisfying the societal needs. the right environment in which to operate. There are four prominent needs identified which gave way for the creation of four fundamental categories of organizations that we witness in the present world. each organization has a distinctive purpose. This is the goal or objective that the organization hopes to accomplish. Organizations can be defined as. This is adaptation need of the society. Organizations need managers to ensure that the technical tasks of an organization are performed to convert its mission to reality and to make people capable of joint performance by giving them common goals and values. composed of two or more people that functions on a relatively continuous basis to achieve a common goal or set of goals‖.

Appley. What is management? Simply speaking management is what managers do.Principles and Practices of Management ADL 01 existence to ensure to achieve the goals of the society. Hence there is no one definition to explain the concept of management. defines management as accomplishment of results through the efforts of other people. cultural and educational institutions. To avoid conflicts in the process of maintenance needs in the society‘s stability maintenance need arouse and deviance reducing organizations came in. directing and controlling to accomplish organizational objectives through the coordinated use of human and material resources. . Laurence A. explain or make any predications about management of organizations. Efficiency refers to getting the most output from least amount of inputs (means) and effectiveness is often described doing the right things(ends). Most often management has been seen simply in terms of getting things done through other people. Thus. organizing. Management can be broadly defined as a process of planning. staffing. Consequently there is no universal language or theoretical clarification as to underpinning that can managers use to analyze. This pattern maintenance need and it gave rise for socializing organizations they are religious. According to Koontz H. management is defined as art of getting things done through and with people in formally organized groups. Management can be explained as coordinating work activities so that they are completed efficiently and effectively with and through other people. They are the judicial systems. The nature of Management The study of management is an evolving concept. Societies intend to maintain the above needs over a period of time.

2.. Who are managers? Managers are people responsible for directing the efforts aimed at helping organizations achieve their goals. commanding. The present text book also follows this order in its chapterization. It is a systematic process. It concentrates on reaching organizational goals. directing and controlling. staffing. It reaches its goals by reaching through and by people. organizing. Let‘s briefly define themPlanning A process that includes defining goals. . planning. coordinating and controlling.Principles and Practices of Management ADL 01 Characteristics of management The various interpretations of management emphasize three things – 1. 3. A manager is expected to coordinate various activities with individual accommodating their goals with the organizational task while performing the functions. and developing plans to coordinate activities. In the mid 1950s the framework of management functions includes planning. establishing strategy. organizing. Major managerial activities are• Make decisions • Allocate resources • Direct activities of others to attain goals What do managers do? – Management Functions Henri fayol first proposed that all mangers perform five functions viz. A manger is someone who works with and through other people by coordinating their work activities in order to accomplish organizational goals.

leading(directing) and controlling to accomplish goals of the organization through the inputs of various resources. . staffing. such as planning. who is to do them. how the tasks are to be grouped. Controlling Monitoring activities to ensure they are being accomplished as planned and correcting any significant deviations. who reports to whom. motivating. leading and supervising the subordinates to accomplish desired objectives.Principles and Practices of Management ADL 01 Organizing Determining what tasks are to be done. Staffing It is the process of attracting. and where decisions are to be made. Management process Management as a process refers to a series of inter. organizing. developing and evaluating individuals at work Directing Direction is the managerial function of guiding.related functions.

responsibility or an inter-personal. managers transmit information about the organization to individuals and groups outside the organization‘s boundary. managers collect information about the organization and its environment from all available sources. As a figure head managers symbolize the organization by attending ceremonies. It is purely strategic in nature. signing legal documents and representing the organization to the external environment. As a spokesperson. informational or division nature. As a monitor. • Informational Roles – As a result of the interpersonal roles managers collect and disperse information. The informational role is actually made up of three subroles. As a disseminator. managers transmit information to others in the organization. As an entrepreneur.Principles and Practices of Management ADL 01 Managerial Roles Managers in order to carry out the functions discussed above. managers seek problem and opportunities and initiate action in the best interests of the organization. Mintzberg‘s research into executives‘ behaviour is the identification of ten active roles that managers must be prepared to enact. With the role of resource allocator. perform various roles in the organization. Each role derives from the position of formal authority within the organisation and defines action. As a leader. The ten roles are discussed under three categories as follows: • Interpersonal Roles – Managers actually perform several inter-personal related roles. thereby giving rise to their informational role. managers are required to handle conflicts among people. As a liaison manger need to develop and maintain contacts with outsiders to gain benefits for the organization. group and between organizations or any external party. As a disturbance handler. • Decisional Roles – The third major role managers play is the decisional role. it is necessary for a manager to motivate subordinates and integrate the need of the subordinate and the needs of the organization. managers make best of choices to allocate .

It includes the capability to understand and use the tools. allow skills to be learned through appropriate training and job experience. the relative importance tends to vary in its intensity of usage according to the level of management.. They are as follows: 1. Human Skill : The ability to work with. engineers. For example. Long term decisions taken by managers need more of conceptual skill to . and motivate other people. All good managers ultimately to solve problems and view organizations as a whole system need to develop this skill. technical skills are more important at lower management level where supervisors are dealing with concrete problems. while others like a sales person. Technical Skill : The ability to apply specialized knowledge or expertise. 2. It emerges as a spirit of trust and genuine environment in inter-personal relationships. For example. Although three skills are essential at each managerial level. Robert L Katz identified and classified three categories of skills that are required for managers. understand. both individually and in groups. possess technical skills acquired through formal education. Conceptual Skill: The mental ability to analyze and diagnose complex situations and to deal with abstract concepts and process complex information properly. A negotiator role played by a manager allows him to represent the organization with formal negotiations with third parties such as unions or government agencies. It is the capability to manage relationships.Principles and Practices of Management ADL 01 resources within the organization. procedures. and techniques needed to do the job. accountants. etc. 3. Managerial skills A skill is an ability to translate knowledge into action that results in desired performance.

Level of management refers to line of demarcation between various managerial positions. Human skill is required across the managerial levels. Three levels of management are: (i) Top level management (ii) Middle level management (iii) Lower level management. respectively are: TOP MANAGEMENT Determine objectives and policies Designs the basic operating and financial structure of an organization Provides guidance and direction Lays down standards of performance . middle managers.Principles and Practices of Management ADL 01 understand the complexity of the situation. The function performed by top managers. and lower managers. The differences arise because of the existence of various levels of management in a typical organization. Levels of Management All managers perform the various management functions but the degree of utility of the functions differs among the managerial jobs.

For example the proportionate of time spent by the middle level manager would be more in organizing and directing because they perform the role of a liason between the top and the lower level of management.Principles and Practices of Management ADL 01 Maintains good public relations MIDDLE MANAGEMENT Interprets and explains the policies framed by the top Issues detailed instruction Participates in operating decisions Trains other managers LOWER MANAGEMENT Plans day-to-day operations Assigns jobs to workers Provides supervision and control over work Arranges material tools and equipment Maintains discipline Hierarchical-Level Differences among Managers and time spent on the management functions This diagram below helps us to understand how much of time a manger spends on the different functions of management. .

. This school of thought is made up of two branches: classical scientific and classical administrative. Managers were worried about increasing the efficiency and productivity.Principles and Practices of Management ADL 01 Schools of management thought The art of management has ancient roots. Thus. developed during the Industrial Revolution when new problems related to the factory system began to appear. described in the following sections. as the major impetus was on manufacturing. the classical management theory developed from efforts to find the ―one best way‖ to perform and manage tasks. This part of discussion helps us to understand several view points and approaches that have shaped up managerial thinking during the past years… Classical Schools of Management The classical management theory.

• Develop and maintain friendly labor-management relations. and train workers • Apply a financial incentive system. by redesigning the shovels the workers used. Henry Gantt.5 tons per day instead of the mere 12. Taylor was able to increase the length of work time and therefore decrease the number of people shoveling from 500 to 140. in 1898. such as Frederick Taylor. many theorists followed Taylor's philosophy when developing their own principles of management. Frederick Taylor Frederick Taylor is known as the ―father of scientific management. Due to such amazing results. and steps. and Frank and Lillian Gilbreth. Taylor calculated how much iron from rail cars Bethlehem Steel plant workers could be unloading if they were using the correct movements. For example.5 tons each worker had been averaging. • Utilize specialized functional supervision. Fredrick Taylor‘s Scientific Management Prescriptions • Develop the science of work (“one best way”). He also developed an incentive system that paid workers more money for meeting the new standard. tools. . The classical scientific management laid emphasis on trying to find the best way to get the most work done by examining how the work process was actually accomplished and by scrutinizing the skills of the workforce.Principles and Practices of Management ADL 01 Classical scientific school: The classical scientific branch arose because of the need to increase productivity and efficiency. • Scientifically select. • Emphasize an absolute adherence to work standards. The result was an amazing 47. He believed that organizations should study tasks and develop precise procedures. place. Productivity at Bethlehem Steel shot up overnight. In addition. The classical scientific school is propagated by various contributors.‖ Taylor himself rose as a manager from the shop-floor at Bethlehem Steel plant.

This visual display chart is a widely used planning and control tool since its inception in 1910. . In Frank's early career as an apprentice bricklayer. A sample Gantt chart is shown as follows for a classic home contractor Frank and Lillian Gilbreth Frank and Lillian Gilbreth.e a bar graph that measuresd. He watched bricklayers and saw that some workers were slow and inefficient. volume.700 bricks per day. He developed the Gantt chart. based on time instead of quantity. i. studied job motions. planned and completed work along each stage of production. was an associate of Taylor. From his observations.Principles and Practices of Management ADL 01 Henry Gantt Henry Gantt . while others were very productive. Workers using these movements raised their output from 1. Frank isolated the basic movements necessary to do the job and eliminated unnecessary motions. or weight. he was interested in standardization and method study. He discovered that each bricklayer used a different set of motions to lay bricks.000 to 2.

objective form of organization was termed bureaucracy. propagated and developed this school of thought. and developing workers instead of allowing them to choose their own tasks and train themselves Developing a spirit of cooperation between workers and management to ensure that work is carried out in accordance with devised procedures Dividing work between workers and management in almost equal shares. He believed that authority should not be based on a person's personality. These theorists studied the flow of information within an organization and emphasized the importance of understanding how an organization operated. instead it was part of a person's job and passed from individual to individual as one person left and another took over. The emphasis is on the development of managerial principles rather than work methods as contrary to the scientific school where productivity was the focal point. Mary Parker Follett. Weber believed that all bureaucracies have the following characteristics: . and Chester I. Max Weber Max Weber propagated that organizations should be managed impersonally within a formal organizational structure. training. Henri Fayol. Barnard. where specific rules are followed. Thinkers such as Max Weber. with each group taking over the work for which it is best fitted Classical administrative school The classical administrative approach focuses on the total organization.Principles and Practices of Management ADL 01 The contribution of Gilbreth couple can be summed as follows: Developing new standard methods for doing each job Selecting. This non-personal.

Authority creates responsibility.‖ should be the basis for all decisions made in hiring. Standard operating procedures govern all organizational activities to provide certainty and facilitate coordination. Division of work: Division of work and specialization produces more and better work with the same effort. and experience. and promotions in order to foster ability and merit as the primary characteristics of a bureaucratic organization. A manager has official authority because of her position. Division of labor and specialization. This clear chain of command facilitates control and order throughout the organization. Records. Henri Fayol Henri Fayol. Competence. Authority and responsibility: Authority is the right to give orders and the power to exact obedience. intelligence. as well as personal authority based on individual personality.Principles and Practices of Management ADL 01 A well-defined hierarchy. These principles provide general guidelines on how a supervisor should organize her department and manage her staff. . Impersonal relationships between managers and employees. Rules and regulations. Managers should maintain an impersonal relationship with employees so that favoritism and personal prejudice do not influence decisions. developed 14 principles of management based on his day to day managerial experiences. Competence. not ―who you know. A bureaucracy needs to maintain complete files regarding all its activities. job assignments. Although later research has created controversy over many of the following principles. they are still widely used in management theories. All responsibilities in an organization are specialized so that each employee has the necessary expertise to do a particular task. All positions within a bureaucracy are structured in a way that permits the higher positions to supervise and control the lower positions.

Order: Organizational order for materials and personnel is essential. Stability of tenure of personnel: To attain the maximum productivity of personnel. Scalar chain: A chain of authority exists from the highest organizational authority to the lowest ranks. Zeal. Centralization: The objective of centralization is the best utilization of personnel. She encouraged managers to allow employees to participate in decision .Principles and Practices of Management ADL 01 Discipline: Obedience and respect within an organization are absolutely essential. a stable work force is needed. Remuneration of personnel: Salaries — the price of services rendered by employees — should be fair and provide satisfaction both to the employee and employer. Unity of direction: Organizational activities must have one central authority and one plan of action. Mary Parker Follett Mary Parker Follett stressed the importance of an organization establishing common goals for its employees. Unity of command: An employee should receive orders from only one superior. The degree of centralization varies according to the dynamics of each organization. The right materials and the right employees are necessary for each organizational function and activity. energy. Work teams and extensive face-to-face verbal communication encourages teamwork. and initiative are desired at all levels of the organizational ladder. Esprit de corps: Teamwork is fundamentally important to an organization. Good discipline requires managers to apply sanctions whenever violations become apparent. Equity: In organizations. Both equity and equality of treatment should be considered when dealing with employees. Initiative: Thinking out a plan and ensuring its success is an extremely strong motivator. equity is a combination of kindliness and justice. Subordination of individual interest to general interest: The interests of one employee or group of employees are subordinate to the interests and goals of the organization.

Chester Barnard Chester Barnard. He felt that these informal organizations provided necessary and vital communication functions for the overall organization and that they could help the organization accomplish its goals. The employees accept the communication as being consistent with the organization's purposes. According to Barnard. The employees feel that their actions will be consistent with the needs and desires of the other employees. Classical theory had ignored employee motivation . He introduced the idea of the informal organization — cliques (exclusive groups of people) that are naturally formed within a company. Barnard felt that four factors affected the willingness of employees to accept authority: The employees must understand the communication. she was a pioneer and often not taken seriously by management scholars of her time. He developed the acceptance theory of management. Behavioral Management Theory With the passage of time the management principles developed during the classica l period were not useful in dealing with many management situations and could not explain the behavior of individual employees. was president of New Jersey Bell Telephone Company. The employees feel that they are mentally and physically able to carry out the order. which emphasizes the willingness of employees to accept that managers have legitimate authority to act.Principles and Practices of Management ADL 01 making and stressed on the importance of people rather than techniques — a concept very much before her time. As a result. it was important for managers to develop a sense of common purpose and a willingness to cooperate.

resources. the behavioral school was a natural outgrowth of thi s revolutionary management experiment. and group dynamics led to improved productivity and efficiency. The theorists who contributed to this school viewed employees as individuals. Behavioral theorists believed that a better understanding of human behavior at work. The behavioral management theory is also known as the human relations movement because it addresses the human dimension of work. expectations.Principles and Practices of Management ADL 01 and behavior. As a result. conflict. The human resource model can be derived to as follows: Elton Mayo . such as motivation. and assets to be developed and worked with — not as machines. contrary to the past.

until the employees were unable to see what they were doing. a series of experiments that rigorously applied classical management theory thereby revealing its shortcomings. a second group of experiments began. and have variations in pay levels and workdays. The general conclusion from the Hawthorne studies was that human relations and the social needs of workers are basic pillars of business management. Essentially. such as the right to leave their workstations without permission. This experiment also resulted in significantly increased rates of productivity. Surprisingly enough. A few years later. the experimenters became a part of the study and influenced its outcome. enjoy free lunches. They gave the women special privileges. take rest periods. The Hawthorne experiments consisted of two studies conducted at the Hawthorne Works of the Western Electric Company in Chicago from 1924 to 1932. Abraham Maslow .Principles and Practices of Management ADL 01 Elton Mayo's conducted the famous Hawthorne studies. The first study was conducted by a group of engineers seeking to determine the relationship of lighting levels to worker productivity. Harvard researchers Mayo and F. they discovered that worker productivity increased as the lighting levels decreased — that is. Roethlisberger supervised a group of five women in a bank wiring room. This principle of human motivation helped revolutionize theories and practices of management. Thus. which describes the special attention researchers give to a study's subjects and the impact that attention has on the study's findings. Mayo and Roethlisberger concluded that the increase in productivity resulted from the supervisory arrangement rather than the changes in lighting or other associated worker benefits. after which the performance naturally declined. J. Because the experimenters became the primary supervisors of the employees. This is the origin of the term Hawthorne effect. the intense interest they displayed for the workers was the basis for the increased motivation and resulting productivity.

such as food and drink. Human behavior is purposeful and is motivated by the need for satisfaction. protection. a theory of motivation based upon a consideration of human needs . into this category. from the lowest to highest. A normal state exists for an individual to have all these needs generally satisfied. Needs can be classified according to a hierarchical structure of importance. Otherwise. . it is no longer is a motivator. and freedom from fear. however. a developed the most widely recognized need theories.Principles and Practices of Management ADL 01 Abraham Maslow. they become primary motivators. After the need is satisfied. Maslow broke down the needs hierarchy into five specific areas: Selfactualization Esteem Social Safety Physiological Need Strength Physiological needs. Safety needs. Maslow grouped all physical needs necessary for maintaining basic human well-being. These needs include the need for basic security and stability. His theory of human needs had three assumptions: Human needs are never completely satisfied.

and incapable of assuming responsibility. but also have high levels of motivation. After the physical and safety needs are satisfied and are no longer motivators. Esteem needs. these managers create situations where subordinates act in ways that confirm the manager's original expectations. The propagators of this thought believe that appropriate management actions and approaches . shifting the focus to the role of individuals in an organization's performance. the Theory Y manager assumes that employees are not only trustworthy and capable of assuming responsibility. fame. has a negative view of employees and assumes that they are lazy. He believed that two basic kinds of managers exist. Self-actualization needs. Contingency School of Management The contingency school of management is based on ―it all depends‖ approach. and glory. An important aspect of McGregor's idea was his belief that managers who hold either set of assumptions can create self-fulfilling prophecies — that through their behavior. untrustworthy.Principles and Practices of Management ADL 01 Belonging and love needs. these theorists discovered that people worked for inner satisfaction and not materialistic rewards. One type. Maslow's hierarchy of needs theory helped managers visualize employee motivation. The individual strives to establish meaningful relationships with significant others. An individual must develop self-confidence and wants to achieve status. reputation. On the other hand.Douglas McGregor Douglas McGregor was heavily influenced by both the Hawthorne studies and Maslow. Assuming that all the previous needs in the hierarchy are satisfied. As a group. the need for belonging and love emerges as a primary motivator. an individual feels a need to find himself. Theory X and Theory Y. the Theory X manager.

and evaluate many options as they solve problems. The above diagram shows the process flow of contingency model. . The contingency approach is highly dependent on the experience and judgment of the manager in a given organizational environment. the approach used to manage a group of youth working in working in a BPO would be very different from the approach used to manage a cabin crew for flight. Contingency management recognizes that there is no one best way to manage. Managers with a contingency view use a flexible approach. draw on a variety of theories and experiences. For example. managers are faced with the task of determining which managerial approach is likely to be most effective in a given situation. In the contingency perspective.Principles and Practices of Management ADL 01 depend on the situation.

Input 2. An open system interacts with its environment. It means whole (outputs) is grater than the sum of parts (inputs). outputs and feedback. products and services. A system is a set of inter related parts (made of sub systems mutually related to each other) eg. A systems view concludes that if sub systems are inter-related properly. each functioning to contribute to the purpose of the whole organization which exists in an interdependent relationship with the external environment.) Transformation process (Activities and operation) Feedback Quality management perspective Output (Goals and profits) . transformation process. technology) etc.Principles and Practices of Management ADL 01 Systems Theory A view of an organization as made up a number of interrelated elements. organizations can create synergy. Process 3. It tries to solve problems within a framework of inputs. Output 4. money.. A system comprises of four basic elements while functioning in its environment: 1. an army. The organization receives inputs from the environment and processes the resources in the system and provides output. A closed system of organization does not interact with the environment or they are responsive to organization‘s environment viz. every department could be a sub system of a manufacturing plant.. Feedback Inputs (Men.

Pascale. 2) People: organizational members are seen as naturally caring about the quality of the work that they do and they are willing to make effort to improve on it too. Deming. 5) Continuous learning and improvement.Principles and Practices of Management ADL 01 The TQM approach to management has its goals as the achievement of customer satisfaction by providing high quality goods and services. TQM management practices are rooted in several assumptions: 1) Quality: it is less costly for an org to turn off quality than poorly produced products and services. Juran. Robert Waterman. continuous improvement. 4) Senior management: quality and continuous improvement is the ultimate responsibility of op management. . According to this theory. It has a goal setting of getting everyone committed to quality. Anthony Athos. Ishikawa are among the pioneers to this approach of management wherein the philosophy and way of managing with the goal of getting everyone committed to quality. A change in any of them has a effect on the other. The research identifies seven Interdependent organizational factors for the functioning of any effective organization. The McKinsey 7-S Framework This framework was developed by Tom Peters. continuous improvement and the attainment of customer satisfaction. 3) Organizations: these are the systems made up of many interdependent parts and therefore problems faced by organizations cut across functional lines. and the attainment of customer satisfaction by meeting or exceeding customer expectations was the way of attaining competitive advantage for organizations. effective managers achieve a good fit among these seven variables.

Theory Z Organizations Given the recent success of Japanese companies. Ouchi showed that American and Japanese firms are essentially different along seven important dimensions: 1.Principles and Practices of Management ADL 01 They revealed that 7 interdependent factors in organizations which must be managed harmoniously. and location of authority within them. 1) Strategy: the plan of actions that allocate scarce resources to org and commit it to specified action overtime to reach goals. length of employment . management writers have been carefully analyzing Japanese organizations. 6) Skills: the distinctive capabilities of an organization key personnel. its divisions. 5) Style: the way managers behave when pursuing organization goals. 3) Systems: procedural reports and routine processes .such as those govern the stand and operating procedures for handling the recitation on an org assets. 4) Staff: imp personnel groups within organizations described demographically. 2) Structure: an org design such as hierarchical levels. 7) Super ordinate goals: the guiding concepts that an organization instills in a manager.

IBM. Nature of concern (holistic) of the employee including family. speed of evaluation and promotion 5. In a very short time.Principles and Practices of Management ADL 01 2. Source: Adapted from W. mechanism of control 6. his ideas have been well received by practicing managers. and P&G are using it. mode of decision making(collective) 3. It is represented in the diagram below. specialization of career path 7. Some companies like HP. Ouchi 1981 Theory Z . Ouchi theory Z proposes a hybrid form of management that incorporates techniques from both Japanese and North American management practices. locations of responsibility 4.

Discuss the major contributions of Hawthorne studies to management. and liaison for an organization are called…………. Walter Dill Scott c. Scientific management d. leader.. Organizational roles that involve serving as a figurehead. 4. How would you define management? Discuss the various functions of management. Charles Babbage 2. ………….‖ a.elaborate. Human relations thought 3. Bureaucratic Organization c. 7.Considered the ―father of scientific management. Discuss various schools of management thoughts. 6. 2. a. Administrative Management b.Principles and Practices of Management ADL 01 Review Questions 1. Why is it important for a manager to understand the Fayol‘s principles of Management? Test your understanding 1. ………………. ―The contingency approach to management is more a commonsense approach ―. 5. What is bureaucracy? List its features and benefits. a.. Frederick Taylor d. How do required managerial skills differ in organizational hierarchy? 3. Interpersonal Roles .school of thought upholds the process of Organizational transactions to be documented. Robert Owen b.

. Abraham Maslow‘s theory identifies……….... Organizations exist to help ……….. sets of basic human needs .... All the above 5... Taylor‘s 7. satisfy its needs a. Quality circles d. None 4. Specialization c.. is a process that includes defining goals.. Leading d. IBM 8.... Charts help to summarize work activities and identify those tasks that should be performed simultaneously or sequentially. Rand Corporation b. Gantt b.Principles and Practices of Management ADL 01 b... Coordinating c. a... Western electric c.... Controlling b. Decisional Roles d.. . a... establishing strategy. Corporate c... Individual d. . and developing directions to coordinate activities of the organizations. Informational Roles c.. Hawthorne experiments were carried out in ………… a. Planning 6. Society b.. Microsoft d.

B 3. A view of an organization as made up a number of interrelated elements is…….. Classical thought c. B 8. Modern management b. C . 5 9. Human relations d. C 2. A 7. 4 b. A 10. A 4.Principles and Practices of Management ADL 01 a. Contingency theory b. a. Scientific school 10. Administrative school Answer key 1. System‘s perspective d. D 6. Systems perspective c. The belief that the techniques appropriate for a manager to use depend on the specific situation is……………… a. D 9. 3 c. A 5. 2 d.

Principles and Practices of Management ADL 01 Chapter 2 Management planning process .

So. This evolved in French into being a map or a drawing of any object made by . Approaches to planning v. Why should managers plan?-Advantages iv. The very essence of planning for any business is to see the various opportunities and threats in its environment for future survival and find ways to exploit and overcome the same as the case may be. operating a business without a plan is like searching for a destination without a roadmap ahead. Planning is one of those things that we all know is good. Types of plans vii. in this chapter let's take a look as what planning really entails. from day-to-day decisions made by individuals and families. Introduction: Planning ii. however. Planning occurs at many levels. Contemporary issues in planning viii. the consequences of such road less travels can even cause to bankruptcy. resource and energy. Origin and Definition The word "plan" originated from then Medieval Latin word planus which meant a level or flat surface. Characteristics of Planning vi. For a business. but no one wants to take the time to do. Origin and Definition iii. While it may seem that planning only takes time away from running your business. to complex decisions made by businesses and governments.Principles and Practices of Management ADL 01 Chapter outline i. Planning is a mammoth task. Outcome of such a trip would be waste of time. Forecasting and techniques in forecasting Planning refers to the process of deciding what to do and how to do it.

Planning therefore has two components: Establishment of goals and means for goal attainment.Principles and Practices of Management ADL 01 projection upon a flat surface. Planning does involve: 1. In English this has become a more general sense of a scheme of action. an examination of the business' environment 3. design or method. Planning is a process that involves defining the organization‘s goals. a realization that planning is a continuing process that is constantly evolving . Planning can be defined as “the process by which managers establish goals and specify how these goals are to be attained”. mangers need to think. Hence. setting goals 5. In the planning as an organizational activity. establishing an overall strategy for achieving those goals. a process for gathering information 7. what has to be done? Who is going to do it? How and when will they do it? In this activity managers analyze the past and future of the business for its fullest exploration of business opportunities and threats to take an action a step ahead matching the organization‘s resources and capabilities. It does not preclude creativity or instinct. but it does add a layer of awareness that spells the difference between survival and extinction in a changing environment. Planning in its current usage in business implies a consciousness of what is happening in the business. and developing a comprehensive set of plans to integrate and coordinate organizational work. It is concerned with both ends and means. an assessment of the business' mission 4. a process for reaching those goals 6. an understanding of the business' history 2.

formulated beforehand. Planning provides direction to managers and non-managers alike. However. The following describes these criteria: Goals must be specific and measurable. Managers should identify a few key result areas that contribute most to company performance which help the employees to understand the scope for their performance. if goals are too easy. It is not something that should be approached haphazardly.Principles and Practices of Management ADL 01 Criteria for effective goals To make sure that goal setting benefits the organization. and financial resources. managers must adopt certain characteristics and guidelines. When possible. they set employees up for failure and lead to low employee morale. Managers must be sure that goals are determined based on existing resources and are not beyond the team's time. Goals should cover key result areas. Why should managers plan?-Advantages Planning is a detailed method. employees may not feel motivated. It helps the employees to know where the organization is going / reaching and it gives guidelines for them as to what to contribute to reach goals. When goals are unrealistic. . Goals should specify the time period over which they will be achieved. use quantitative terms to express goals. There are at least four reasons for planning: 1. Goals should be challenging but not too difficult. for managing all or part of a business. equipment. Goals should be linked to rewards. People who attain goals should be rewarded with something meaningful and related to the goal. Deadlines give team members something to work toward and help ensure continued progress.

Hence it increases economic efficiency. Planning offsets and reduces uncertainty and change. A systematic approach to planning process consist the following steps: Step 1 Developing awareness of an the state present Step 2 Establishing outcome statements • Goal planning Step 3 Premising • Forecasting • Formulating assumption s Step 4 Determining a course of action • Identifying alternatives • Evaluating alternatives • Selecting alternatives Step 5 Formulating supportive plans • Making changes existing plans in • Creating supportive new plans . systematic and integrated process. identify significant deviations. Steps Planning Process Planning is ideally a process. Managers are forced to look ahead and develop reactive and proactive responses with strategies as planning in it self cannot eliminate the change or uncertainty. Planning facilitates control by establishing standards. 3. 4.Principles and Practices of Management ADL 01 2. It minimizes overlapping of activities. and take any necessary corrective action. Through controlling one could compare actual performances against goals. It involves an extensive decision making process where in analysis of the alternatives leads to a choice of collective course of action. Planning provides work coordination. It is futuristic. comprehensive. A well defined planning process negates all the possible wasteful activities around the task established.

where there is less uncertainty about the task involved. recognizes its strengths and weaknesses. pinpoints its commitments. and set forth a vision of the future. domain/direction planning involves the development of a course of action that moves an organization toward one domain or direction. In simple words. Domain planning occurs at the upper level of the organization where managers are responsible for dealing with the external environment. When there is a recognized need for flexibility. b. Goal planning is likely to prevail in the technical core. or assumptions. Developing the premises: Managers establish the premises. to achieve the overall goals of their organization.‖ 2. where managers begin with the more general domain planning and commit to move in a particular direction. Whereas. Situations in which managers are likely to engage in domain planning include a. d. it is an approach coupling the concepts of Domain and Goal planning. When an organization is starting up or is in a transitional period 3. Hybrid planning is a third approach. When an organization‘s external environment is unstable / uncertain. The quality and success of any plan depends on the quality of its underlying . It has been said – ―The further you look back. This foundation specifies an organization‘s current status. the further you can see ahead. Managers develop an elaborate network of organizational plans.Principles and Practices of Management ADL 01 1. Establishing the outcome statements: This involves establishing goals. Domain and Hybrid Planning – Goal planning involves development of action statements to move towards the attainment of a specific goal. Managers at various levels in the organization‘s hierarchy set goals. Developing awareness state: It is at this step that managers build the foundation on which they will develop their plans. Goal. When people cannot agree on goals. c. on which they will build their action statements.

To conclude. Approaches to planning Managers follow various approaches to planning depending on the extent and intensity of the goal. They use this information to make assumptions about the likelihood of future events. In this view it is important for the organization to involve people at various levels of the management in the planning activities. Determining a Course of Action: This step involves evaluating alternatives and selection. The pros and cons of each alternative must be well examined before the choice is made. This helps people to be self motivated to carry on the planned course of action in attaining the organization‘s goal. the successful implementation of plans depends on the co-operation of the employees.Principles and Practices of Management ADL 01 assumptions. Evaluation of the alternatives are considered through time. 4. participation and delegation. management has to formulate secondary plans to support the basic plan. It determines how an organization will get from its current position to its desired future position. experimentation and experience. Selecting a course of action is done considering the merits of each alternative. Plans have to be set in an atmosphere of participation and high degree of consensus among the employees. It is necessary to evaluate the alternatives in the light of how well each alternative would help the organization to reach its goals or the desired domain. Managers collect information by scanning their organization‘s internal and external environments. cost and resource committed by the organization. 5. Alternatives are determined through research. The plans derived for departments units and activities in detailed manner is called the derived or supportive plans. They are . Formulating Supportive or Derivative Plans: After selecting the best course of action.

Planning is a mental exercise involving creative thinking . Planning is looking ahead. In most of the family owned businesses it is followed. It is either a straight no or a very little contribution in this approach to planning by lower level managers. 2. It provides sense of direction to various activities. They do the whole exercise of planning for the organization. The lower and middle level managers come up with tentative plans. This brings commitment to goal and resources by the employees themselves. b. (d) Team approach: In this method the team managers are identified with specialization in various functional areas. c. (b) Bottom -up approach: In this approach the lower and middle level managers are encouraged to plan. In approach the success depends on the skills. analyzing it and predicting it. Authority and responsibility to the planning process is centralized in top. Planning is made to achieve desired objective of business. b. Characteristics of Planning 1. (c) Composite approach: Here the top management provides the guidelines for planning and set the premises.Principles and Practices of Management ADL 01 (a) Top-down approach: In this approach the mission flows from the top level of management. It requires peeping in future. Thus planning is based on forecasting. They draft the plan and take approvals from the top management. a. Planning identifies the action that would lead to desired goals quickly & economically. Planning is goal-oriented. a. It is then debated and put in practice. knowledge and competency of people at the top. 3.

6. . It avoids wastage of resources and ensures adequate and optimum utilization of resources. problems may keep cropping up and they have to be tackled by planning effectively. a. Planning is a Continuous Process. facts and considered estimates. b. 5. the scope of planning may differ from one level to another. money. a. b. Planning is the primary function of management / Primacy of Planning. Therefore. c. The top level may be more concerned about planning the organization as a whole where as the middle level may be more specific in departmental plans and the lower level plans implementation of the same. Planning essentially involves choice among various alternatives. there is no need planning because there is no choice. Planning is designed for efficiency. a. All the functions of management are performed within the framework of plans laid out. 7. staffing. Planning is all Pervasive. Planning is done at all levels of management. A manager is surrounded by various alternatives. Planning is always based on goals. Planning never comes into end till the enterprise exists issues. 4. if there is only one possible course of action. foresight and imagination. materials. a. Planning leads to proper utilization of men. Planning leads to accomplishment of objectives at the minimum possible cost. directing and controlling. 8. c. b. methods and machines. b. b. It serves as a guide for organizing. He has to pick the best depending upon requirements & resources of the organization. A manager can prepare sound plans only if he has sound judgment. a.Principles and Practices of Management ADL 01 a. Planning lays foundation for other functions of management.

a. and facilitators develop operational plans to support tactical plans. Policies are general statements that explain how a manager should attempt to handle routine management responsibilities. the original plan of action must be revised and updated to male it more practical. The following are examples of ongoing plans: A policy provides a broad guideline for managers to follow when dealing with important areas of decision making. is a single-use plan because it deals with the who. which in turn lead to the attainment of strategic plans. Continuing or ongoing plans are usually made once and retain their value over a period of years while undergoing periodic revisions and updates. . team leaders. A one-time occurrence. Operational plans can be a single-use plan or an ongoing plan. Single-use plans apply to activities that do not recur or repeat. Operational plans lead to the achievement of tactical plans. a. and how much of an activity. In addition to these three types of plans. what. A budget is also a single-use plan because it predicts sources and amounts of income and how much they are used for a specific project. how. Types of plans Three major types of plans can help managers achieve their organization's goals: strategic.Principles and Practices of Management ADL 01 9. Planning is Flexible. b. where. managers should also develop a contingency plan in case their original plans fail. Supervisors. tactical. such as a special sales program. and operational. Operational plans An operational plan is one that a manager uses to accomplish his or her job responsibilities. Under changed circumstances.

and who is in charge at each level. This procedure usually begins with a supervisor completing a purchasing requisition. These plans usually span one year or less because they are considered short-term goals. for example. Depending on the amount of the request. for example. Tactical plans are concerned with shorter time frames and narrower scopes than are strategic plans. A rule is an explicit statement that tells an employee what he or she can and cannot do. Normally. performance appraisals. A procedure is a set of step-by-step directions that explains how activities or tasks are to be carried out. how they must do it. the purchasing department may place an order. . it is the middle manager's responsibility to take the broad strategic plan and identify specific tactical actions. address such matters as employee hiring. or they may need to secure quotations and/or bids for several vendors before placing the order. pay increases. rules about tardiness and absenteeism permit supervisors to make discipline decisions rapidly and with a high degree of fairness. Tactical plans A tactical plan is concerned with what the lower level units within each division must do. and discipline. procedures provide a standardized way of responding to a repetitive problem. on the other hand. Rules are ―do‖ and ―don't‖ statements put into place to promote the safety of employees and the uniform treatment and behavior of employees. Most organizations have procedures for purchasing supplies and equipment. can take several years or more to accomplish. By defining the steps to be taken and the order in which they are to be done. For example. The requisition is then sent to the next level of management for approval. terminations. Tactics are the means needed to activate a strategy and make it work.Principles and Practices of Management ADL 01 Typical human resources policies. The approved requisition is forwarded to the purchasing department. Long-term goals.

Strong management requires a ―keeping all options open‖ approach at all times — that's where contingency planning comes in. Requiring multilevel involvement. Contingency planning involves identifying alternative courses of action that can be implemented if and when the original plan proves inadequate because of changing circumstances. Unexpected problems and events frequently occur. Top management's strategic plan for the entire organization becomes the framework and sets dimensions for the lower level planning. while lower levels of management develop compatible objectives and plans to achieve them. Anticipating change during the planning process is best in case things don't go as expected. When they do. managers may need to change their plans. flexibility. It begins with an organization's mission. Strategic plans look ahead over the next two. rather than with the goals of specific divisions or departments. Management can then develop alternatives to the existing plan and ready them for use when and if circumstances make these alternatives appropriate. Top-level management develops the directional objectives for the entire organization. . these plans demand harmony among all levels of management within the organization. or even more years to move the organization from where it currently is to where it wants to be.Principles and Practices of Management ADL 01 Strategic plans A strategic plan is an outline of steps designed with the goals of the entire organization as a whole in mind. Keep in mind that events beyond a manager's control may cause even the most carefully prepared alternative future scenarios to go awry. Contingency plans Intelligent and successful management depends upon a constant pursuit of adaptation. five. three. and mastery of changing conditions.

Principles and Practices of Management ADL 01 Contemporary issues in planning We conclude this chapter by addressing few contemporary issues in planning. Planning is not left to chance and top level managers must ensure a conducive environment must be crated to the smooth and systematic take of the plans in the organization (ii) Participation by people. This helps to gain commitment from all the level of management. The function of controlling . All the employees must be communicated with the goal. Total Quality Management approach to the planning process After managers have done with the five steps in the planning process and have implemented the formalized plans. they must monitor and maintain the same. direction and premise. (iv) Monitoring of the process. With the option of flexibility and regular review process in planning there is always a possibility to exploit the opportunities in the external environment. Planning always moves from the values held at top level of management. when and how in the time limit. (v) Management support. (iii) Communication to people. It enhances the capability of the manager to be effective in their approach to planning. Total quality management approach in planning and Criticisms of planning. When will planning be effective? According to Koontz and O‘Donnell a cautious understanding of the following things would lead a plan to be effective (i) Climate of planning. It helps people to know what to do. Specifically it includes How to plan effectively in a dynamic environment.

4. The criticisms are discussed in detail: (a) Planning may create rigidity: .Principles and Practices of Management ADL 01 helps the evaluate the attainment of goals set in the planning process. The cycle consists of four key stages: 1. but to make it effective companies like IBM have linked their planning and controlling process by adopting Deming Cycle. 3. Plan—create the plan as discussed earlier in this chapter with the process 2. for the purpose of continuous learning and improvement. Act—on what was learned. Do—implement the plan. But critics have questioned some of the basic assumptions to the process of planning. It is a Total Quality Management (TQM) process. Criticisms of planning It makes a lot of sense that from formalized plans every organization gains a direction. modify the plan. and return to the first stage. It helps managers to assess the effect of planned action through a systematic review. Check—monitor the results of the planned course of action. Every manager must be precautious of these assumptions in their attempt to planning.

(e) Planning can let organizations to get in competency traps : Managers in the success of implementation of the course of action. no manager would like to discard the old plans in favour of new even when circumstances demand. Forecasting and techniques in forecasting It is a planning tool used to predict future environmental happenings that will influence the operations of an organization. (b) Plans cannot be developed for dynamic environment: It is difficult to predict and forecast economic conditions. which put the executors on a comfortable position. (c) Formal plans are costly and time consuming: It is expensive in terms of time spent to formulate plans.Principles and Practices of Management ADL 01 New opportunities are often ignored or rejected because of the commitment to the existing plans. competitive situations and change in government policies with any degree of accuracy. Based on the . fail to analyze and evaluate the feedback or the gap in the process for improvement. Once established. But this may hamper the organization‘s vision to sustain on a long run. the man power required to do the planning and the resources needed to execute the plan. (d) Planning forces managers‘ attention to a short term goal: Planning is intellectually demanding function since managers assist on the basis of results. This can lead organizational plans to fail. the human tendency begins to discount long range plans and promote to adopt short range plans. policies and procedures become a part of organizations activity and hence. Reliability of planning efforts is open to doubt since they are projected farther into the future where managers has no control over environmental forces. Forecasting is a systematic attempt is made to look all the past and present influential factors affecting the working of the organization.

Comparing the actual with the estimated results is a continuous process. managers are forced to make certain assumptions regarding future. Against the backdrop of information collected. Developing the ground work with the known and available information about the company‘s growth. The last element is refining the forecast process. etc. product lines. . is the first stage of investigation in the forecasting. Planning is deciding in advance what is to be done in the future and future is uncertain and risky. 2. They are as follows: 1.Principles and Practices of Management ADL 01 analysis of these factors through statistical and econometric techniques a reliable calculation is done to predict the probabilities of the future. Planning and forecasting are closely related to each other. three commonly used business forecasting techniques are (1) Deterministic Techniques. As time progresses. As a result. (2) Symptomatic Techniques. its positioning. managers should be able to adjust the forecasting techniques to meet the changing needs of business.S. The trends are projected by the management after a detailed and close scrutiny of the information. The forecast provides the measurement apparatus and helps in tracking down reasons for major differences resulting in unanticipated gains or losses. This is forecasting. and (3) Systematic Techniques. 4. an estimate of future business prospects is made by the management.Silk. 3. Techniques of Forecasting According to L. Forecasting provides pertinent information for successful planning as it is based on systematic models and techniques. Essential Elements in Business Forecasting: Research Redfield identifies four essential elements for business forecasting.

Gross national product (GNP) is the most important indicator. The econometric approach of forecast uses econometric models to tackle a forecasting problem.Principles and Practices of Management ADL 01 Deterministic Techniques assume that there is a close causal connection between present and future. Systematic approach in forecasting are derived from the economic theory. future trends are predicted. They are intuitive approach in which the analysts uses his judgment and experience in summarizing the information collected and draws inferences in constructing various forecasts. The principle techniques used here are latest information. GNP is the value of goods and services produced in the country in a year. consumer expenditure and general business conditions. knowledge of programs or limits. It is more effective as a method to predict future as it is fully supported by quantitative techniques. These models express the relationship among a number of variables associated with the changes in sales volume in mathematical terms through computers. There are numerous indicators employed to measure economic activity in a nation. These techniques are used to forecast certain elements such as capital spending. Symptomatic Techniques are based on the points of information spotted through the economic activity of a country‘s national and industrial indices. Generally. there are two approaches used in this type of forecasting. present and future are ascertained and forecast are then constructed. a predictive model is developed from a theory or set of theories that will determine general business activity. The following methods are employed to forecast the future GNP: . Economic forecasting methods The basic aim of economic forecasting is to predict business fluctuations. The cause and effect relations among different economic factors which hold relevance for past. spotting the beginning of a lengthy process and diagnosing peoples expectation. Based on the significant changes in the business activity over a period of time and based on the information collected.

Econometrics: This is a mathematical approach in which the main variables are joined together in a series of equation. . technical innovations. etc. to whom. etc. change in political climate. Extrapolation ignores factors like sudden changes in consumer tastes and preferences. various methods are employed in sales forecasting: Jury of executive opinion method: In this method. the views and opinions of top executives are brought together for the purpose of constructing the sales forecasting. The purpose is to find out whether the indicating factor has regularly moved in advance of the general business trend. The estimates of company sales force regarding the future prospect of company products are taken into account while constructing the sales forecast.Principles and Practices of Management ADL 01 Extrapolation: Extrapolation is a projection of current trend into the future. their own assessment of sales effected and pooled together by the company are put to analysis on the basis of which the sales forecasts are developed later on. and by what methods etc. Sales forecasting methods Sales forecast is a projection of the expected sales. where changes take place slowly. Lead and lag method: In this method. at which place. the historic behaviour of various indicators is studied. national income. population trends. It provides information such as how many goods an industry should sell. It is used to forecast industry growth. or has moved simultaneously with it or has lagged behind it. Grassroots method: In this method a survey of the sales force is undertaken.

sample surveys of customer‘s expectations are conducted in selected market areas by sales people in order to determine the sales forecast for the product. Quantitative method: Methods like trend projection. However. econometric models are used to construct sales forecasts these days. . this is not reliable method because quite often consumers contradict themselves.Principles and Practices of Management ADL 01 User expectation survey method: In this method. and to remove these limitations if a large sample is selected the benefits may not be commensurate with the costs involved.

Contingency planning . Market growth c. ―Keeping all options open‖ approach at all times …………. ………….. National income 3. Planning is an all pervasive and continuous function of management.Principles and Practices of Management ADL 01 Review Questions 1. Write short notes one (A) Tactical planning (B) Contingency planning (C) Policy and standing plans Test your understanding 1. Elaborate steps in planning process.forecast is a projection of the expected sales. Governance d. GDP d. a. Sales b. What do you mean by forecasting? Discuss its types. 3.discuss. Planning is a process that involves defining the organization‘s ……… a. 5. What is the necessity of planning in modern organizations? 2. Leadership c. Define planning. Sales 2. 4. 6. Goals b. Planning and forecasting are intertwined-comment your views. a. What are the essential features of a good plan? 7.

Rule d. Supportive b. Top down approach b. Primary d. Bottom up approach d. a. etc. All the above 5. Procedure b. Planning is the ………….Principles and Practices of Management ADL 01 b. Strategic plans c. Standard c. Secondary 8. …………… approach in planning allows the lower and middle level managers to plan. a. Regulation 6. Horizontal planning c. a. Extrapolation . TQM b. None 4. …………method of forecasting ignores factors like sudden changes in consumer tastes and preferences. change in political climate.function of management a.is an explicit statement that tells an employee what he or she can and cannot do. A ……………. Procedural planning d. technical innovations. Judgmental planning 7. PCMM c. Controlling d. …………… is the process in planning done for the purpose of continuous learning and improvement? a. Complementary c.

Economic theory b. A 4. C 8. Operations Answer key 1. A 3. A 5. C 6. All the above 10. Systematic approach in forecasting are derived from the a. A . Top management d. Planning provides direction to ………………. a. Technical 9. A 2. Judgmental d. Managers and non-mangers b.. Mathematical theory d. Managers only c. A 10. C 7. Interpolation c. A 9.Principles and Practices of Management ADL 01 b. Inferences c.

Principles and Practices of Management ADL 01 Chapter 3 Organizing .

It helps in prescribing formal relationships among people and resources. It is the way work is allocated among people. Organization as a process vi. The process of organizing is discussed in detail later. Features of an effective organization structure v.Principles and Practices of Management ADL 01 Chapter outline i. Principles of organizing vii. Responsibility is the obligation of a subordinate to perform the duty. with a view to achieve goals. • Formal organization: A formal organization has the feature of- . Introduction -Organizing ii. It is generally understood as a form or into a whole consisting of interdependent or coordinated parts or to systematically arranging several elements into a purposeful sequential or spatial (or both) order or structure or to assemble required resources to attain organizational objectives. Authority and delegation of authority The term organization is used in many different ways. issue orders. facilities and tasks are related to each other. It also defines responsibility and authority in the process of allocating tasks among employees. Departmentation viii. Span of control ix. What is organizing? Organizing is the process by which employees. as required by the superior and authority is the formal legitimate right of a manger to make decisions. and allocate resources to achieve goals. to achieve goals or desired objectives. Defining organization structure iv. What is organizing? iii. Organizations can be formally created or they can be informal.

communication networks (―grapevine‖). • Informal organization:  It is a joint activity between two or more individuals not formally designed that possibly contributes to joint results.  Here the Structure (membership). The whole structure takes the form of a pyramid. Organization as a structure has the following features: Organizational structure is a network of relationships in which the work is divided into units and departments.Principles and Practices of Management ADL 01  The official structures and systems consciously designed by organizational members to accomplish organizational goals. structure is essential for achieving goals. Through this framework individual efforts are coordinated. Thus the term organization structure describes the organization‘s framework. Organized to meet the social and personal needs/wants of organizational members. skill and . creating various positions and assigning reporting relationships helps managers to materialize the goals planned. how it is to be done.  The relatively enduring people-to-people and people-to-work interaction patterns created to accomplish organizational goals. It is both formal and informal network of superior-sub ordinate relationships. Defining Organization as a structure According to the theorists of classical school of thoughts. It helps managers in understanding the tasks and activities. The writing of job descriptions. and relationships (behaviors and norms) do not necessarily follow those of the formal organization. This division of work is helping in bringing specialization in various activities of concern. It is nothing but a chart of relationships. Organizational structure helps in putting right men on right job which can be done by selecting people for various departments according to their qualifications.

this provides enough space to a manager to develop his talents and flourish his knowledge. The work must be systematically classified to each person in the organization through a separate and distinctive task.ordination among different departments of the enterprise.ordination between authority. Where the roles and activities to be performed are clear and every person gets independence in his working. This scope for bringing new changes into the running of an enterprise is possible only through a set of organizational structure. For smooth running of an organization. Identifying the work We organize to achieve objectives. The roles to be performed by different managers are clarified. the co. This enables managers to concentrate on important tasks. Clarity should be made for having an ultimate responsibility attached to every authority. This all leads to efficient and effective administration. It is therefore necessary to understand the total work identified to reach the goal.Principles and Practices of Management ADL 01 experience. Harmony of work is brought by higher level managers exercising their authority over interconnected activities of lower level manager. This is helping in defining the jobs properly which clarifies the role of every person. There should be co. It creates clear cut relationships among positions and ensures mutual co.ordination between different relationships.responsibilities is very important.operation among individuals. A manager gets ready for taking independent decisions which can be a road or path to adoption of new techniques of production. Specialization is achieved through division of work. . Organization is a means of creating co. Hence efforts would be channelized in the right way. Process of Organizing The following are the steps in organizing function. It would also avoid overlapping of activities. Organization structure is helpful in defining the jobs positions.

Creating an organization by dividing the work into departments and positions will not be sufficient to get the results. Departments and divisions are created based on this for manager to gain direction. the activities in all the areas are required to be pulled together. It is the right to take action and utilize organizational resources. Generally closely related activities are group together. Authority is the capacity of a superior to make decision affecting the behavior of subordinates. The Purpose of organizing: The process of organization should facilitate the achievement of objectives in efficient way. how must be done. Providing coordinating and controlling To ensure a harmonious and smooth working of an organisation with a number of its divisions. . department or its units. The important principles of organization according to Koontz can be summarized as follows: 1. Principles of organizing A principle is a basic statement that provides understanding and guidance to practice. formal relationships are specified. manager ceases to be a manager for he cannot get his wishes carried out.Principles and Practices of Management ADL 01 Grouping the work Division of work creates the need for co-ordination. Without authority a. Delegating authority Authority is the key to the management job. It helps individuals to know what must be done. to whom matters must be referred and how particular jobs relate to each other. Establishing the relationships To secure clear compliance of organizational directives. unified and blended so as to give them a commonness and purpose.

Principles and Practices of Management ADL
01
a. Principle of unity of objectives
An organization structure is effective if it as a whole, and every part of it, make
possible accomplishment of individuals in contributing toward the attainment of
enterprise objectives.
b. Principle of organizational efficiency
An organization structure is efficient if it is structured to make possible
accomplishment of enterprise objectives by people with minimum costs.
2. The cause of Organizing: The span is the major cause to execute through, by mangers.
a. Span of management Principle
There is a limit at each managerial position on the number of persons an individual can
effectively manage. But this number is not a fixed number and it will vary in
accordance with underlying variables of the situation from routine to simple task.
3. Principles in Developing the Structure of Organization: Every manager must
delegate some task or duties to subordinates, since management means getting work
done through others. Organization becomes operational through delegation only.
Delegation is a process by which a manager assigns a portion of his total work load to
others.
a. The scalar Principle
The more clear the line of authority from the ultimate authority for management in an
enterprise to every subordinate position, the more effective will be decision making
and organization communication at various levels in the organization.
b. Principle of delegation
Authority is a tool for managing to contribute to enterprise objectives. Hence authority
delegated to an individual manager should be adequate to assure his ability to
accomplish results expected of him.
c. Principle of authority and responsibility

Principles and Practices of Management ADL
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The responsibility of the subordinate to his superior for authority received by
delegation is absolute, and no superior can escape responsibility for the activities of
his subordinate to whom he in turn has delegated authority.
d. Principle of unity of command
The more completely an individual has a reporting relationship to a single superior, the
less the problem of conflict in instructions and the greater the feeling of personal
responsibility.
e. Authority level Principle
Maintenance of authority delegation requires that decisions within the authority
competence of an individual manager be made by him and not be referred upward in
the organization.
4. The structure of organization/ Departmentation: The primary purpose of organizing
is to provide a basic structure in the form of departmental framework.
a. Principle of division of work
It reflects the classification of the tasks and activities required for achievement of
objectives and assists their coordination through creating a system of interrelated roles;
and the more these roles are designed to fit the capabilities and motivations of people
available to fill them, the more effective and efficient an organization structure will be.
b. Principle of functional definition
The more a position or a department has clear definition of results expected, activities
to be undertaken, organization authority delegated, and authority and informational
relationships with other positions, the more adequately individual responsible can
contribute toward accomplishing enterprise objectives.
5. Principles in the Process of organizing: If the following principles are applied the
process of organizing becomes easy:
a. Principle of balance

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The application of principles or techniques must be balanced in the light of the over-all
effectiveness of the structure in meeting enterprise objectives.
b. Principle of flexibility
The task of managers is to provide for attaining objectives in the face of changing
environments. The more provisions are made for building organization flexibility, the
more adequately organization structure can fulfill its purpose.
c. Principle of leadership facilitation
The more an organization structure an authority delegation within it make possible for
various managers to design and maintain an environment for performance, the more it
will facilitate leadership abilities of managers.
Departmentation
Introduction
Departmentation is a means of dividing a large and complex organization into smaller,
flexible administrative units. It is the organization-wide division of work into various
manageable units or departments. It refers to horizontal differentiation in an organization.
Departmentation is essential because of the following reasons:
Departmentation permits an organization to take advantage of specialization.
Departmentation enables each person to know the particular part which he is expected
to play in the total activities of the company.
Departmentation facilitates communication, coordination and control contributing to
the overall organizational success.
Departmentation provides an adequate platform around which the loyalties of
organizational members may be built.
It enables a manager to locate the sources of information, skills and competence to
take certain vital managerial decisions.
Bases of Departmentation
There are several key ways in which an organization may decide to divide the work.

Specialization by function. Span of control. Here activities are grouped together by common function. It is commonly described as ‗organizing work into related bundles of skill‘. Line staff division. f. c. Sub-goal emphasis. Growth is always pyramidal.Principles and Practices of Management ADL 01  Departmentation by Function The basic aim of functionalism is to simplify complexity by grouping all the work to be done into major functional departments. A Functional structure President Finance Marketing Marketing Research Operations Advertising Sales Human Resources Research and Development . e. g. b. The functional structure is the most widely used form because of its simple logic and common sense appeal. Centralization and decentralization. d. Each functional unit has a dissimilar set of duties and responsibilities. Functional relationship. Features of Functional Structure: a.

We often notice the doctors. nurses and railway employee changing shifts on the basis of day. Divisionalisation prevents neglect of certain product and overemphasis on some. Vice President (Production) Manager Automobiles Manager Refrigerators Manager Spare parts Departmentation by Time In some organization that works round-the-clock Departmentation is based on time. Accountability is made clear. Vice President (Production) Day Shift Evening shift Night Shift . The product structure is organized according to organizational output. If a product fails the department and the manger is held responsible. The structure is divided into several fairly autonomous units.Principles and Practices of Management ADL 01  Departmentation by Product Departmentation by product is adopted in the case of a multi-product enterprise. evening and night.

Extensive information needs .The need for shared resources .Multiple external demands . this way of divisioning helps organization to co ordinate activities to all regions from the headquarters.Principles and Practices of Management ADL 01 Departmentation by territory/ geographic divisionalization It facilitates in adaptation to territorial differences. Matrix design is used to respond to: . A Territorial Divisional structure President Western Division West Eastern Division Northeast Midwest Southeast Manitoba Illinois Saskatchewan Minnesota Alberta Washington British Columbia Oregon California Matrix structures In a matrix structure organizations simultaneously integrate and use two or more organizational structures. It helps in exploiting local advantages. It also reduces transport costs too. It is a permanent organization designed to achieve specific results by using teams of specialists from different functional areas in the organization. When companies distribute products on the basis of territory. The entire superstructure is both product and function-based.

Wide span of control.It is one in which a manager can supervise and control effectively a large group of persons at one time.Principles and Practices of Management ADL 01 A Matrix Superstructure President Vice President Products Vice President Finance Vice President Marketing Product A Manager Vice President Operations Vice President Human Resources Manager A Product Line: Product B Manager Authority. This decision can be taken by choosing either from a wide or narrow span. The features of this span are: Less overhead cost of supervision  Prompt response from the employees  Better communication  Better supervision  Better co-ordination . Coordination Systems Functional Line: Authority. There are two types of span of control:a. According to this principle. Responsibility. a manager should be able to handle what number of employees under him should be decided. Coordination Systems Span of control Span of control is a span of supervision which depicts the number of employees that can be handled and controlled effectively by a single manager. Responsibility.

He has the right to enforce decision also. What is Authority? Authority is the capacity of a superior to make decision affecting the behavior of subordinates.  Messages can be distorted. It is the right to take action and utilize organizational resources.Principles and Practices of Management ADL 01  Suitable for repetitive jobs According to this span. Right to decide: Authority allows the positions holder to decide things.  Specialization work can be achieved. The manager according to a narrow span supervises a selected number of employees at one time.  Communication gaps can come. . manager ceases to be a manager for he cannot get his wishes carried out. The features are: Co-ordination is difficult to be achieved. one manager can effectively and efficiently handle a large number of subordinates at one time. Creating an organization by dividing the work into departments and positions will not be sufficient to get the results. b.According to this span. Without authority a. Narrow span of control. Authority Introduction Authority is the key to the management job. It has the following features: Legitimate right: Authority enables a position holder to regulate the behavior of his subordinates in a legitimate manner. the work and authority is divided amongst many subordinates and a manager doesn't supervises and control a very big group of people under him.

Positions descriptions Types of Authority Traditional authority: Traditional authority is based on the sacredness of the social order. Factors Affecting Limits of authority of a Manager External Factors Government rules and regulations Collective bargaining and agreements Dealer. supplier and customer agreements Social beliefs. rules and procedures. Positional: Authority is positional. the authority of the individual also changes. It rests in the chair. authority is the right to give orders and the power to exact obedience. With the change in position. Charismatic authority: This authority rests on the magical. codes. mystical quality of individual leaders. Result-oriented: Authority is linked with the objectives of an organization. According to Fayol. It is used to achieve the organizational goals. habits and customs Internal Factors Corporate by-laws and organizational chart Budgets Policies. It speaks about the relationship between two persons: one superior and the other subordinate. Relationship between two persons: Authority draws curtains between two individuals.Principles and Practices of Management ADL 01 Obtain Obedience: Authority is exercised to influence the behavior of subordinates in a certain manner. .

. experience. etc. Informal authority: Formal authority is granted to people in the organization deliberately to meet certain goals. Line authority: In line authority. expertise. Official authority: As against personal authority which is derived from personal qualities such as intelligence. Staff authority: Staff authority is advisory in nature. A staff officer has the authority of ideas only.. Superior issue orders and subordinates obey them because this is the way the organization is established. Process of Delegation of Authority Delegation process involves four distinct stages. The following figure shows the stages in the process of delegation of authority. Legal authority: This authority originates in the formal structure of the organization. Functional authority: Functional authority is a limited form of line authority given to functional experts over certain specialized activities under the normal supervision of managers belonging to other departments.Principles and Practices of Management ADL 01 Technical authority: This is based on the technical competence and expertise of an individual. a superior exercises direct command over a subordinate. The process of delegation moves through these stages. External authority: This authority comes from source outside the organization. official authority is derived from manager‘s postion.

Their less competent and responsible counter-parts need more specific guidelines. The manager (delegator) must communicate clearly his expectations. duties are assigned to the subordinate. Authority must be delegated strictly to perform the assigned duty. (B) Transfer of authority to perform the duty In the second stage of delegation process. The authority is delegated accordingly and the subordinate is told what is expected from him. the authority is granted by the delegator to his subordinate (delegate). targets to be achieved by the subordinate are also spelt out.Principles and Practices of Management ADL 01 Four Stages in the Delegation of Authority (A) Assignment of duties to subordinates Before delegating. the delegator has to decide precisely the duties which are to be delegated to the subordinate or a group of subordinates. The usual practice is to list the functions to be performed by the subordinate. The performance of duties suffers serious setback when required authority is not delegated along . In brief. If necessary. in the first stage of delegation process. Competent and responsible employees may be given general guidelines about what needs to be accomplished. Subordinates may be assigned tasks either in terms of activities or results.

Some of the important features of delegation may be listed thus: Two-sided relationship: Delegation is a two-sided relationship. since management means getting work done through others. Nature of Delegation Every manager must delegate some task or duties to subordinates. A subordinate is also responsible/accountable for completing the assigned work. It is a demanding function. the subordinate/delegate has to accept or reject the task assigned to him in the first stage along with the authority given in the second stage. it requires sacrifices from both the assignor and the assignee. . Delegation is a process by which a manager assigns a portion of his total work load to others. On the other hand. the process of delegation will move to the fourth and the last stage. an obligation is created. He is held answerable to a superior for the satisfactory performance of that work assigned. Organization becomes operational through delegation only. delegation of authority is the creation of obligation on the part of the subordinate to perform duties assigned to him in a satisfactory manner by using the authority given. the delegator has to make fresh plan of delegation or may consider some other subordinate who is capable and is willing to accept the assignment. In brief. (C) Acceptance of the assignment In this third stage of delegation process. He has to perform the assigned task by using the authority granted to him. the transfer of authority should be adequate considering the duties assigned to the subordinate. If the delegates refuse.Principles and Practices of Management ADL 01 with the duty. The delegator has to help his subordinate as and when necessary as he is responsible to his superior/organization. (D) Creation of Obligation / Accountability / Responsibility The fourth stage in the. When subordinate accepts a task and the authority is given. if the first delegates accept the assignment of work accompanying the authority.

o To minimize politics in the enterprise. Freedom to think and act: Delegation is a state of mind. A challenging task: Delegation of authority is a courageous act. This principle has three advantages: o Delegation by results helps the subordinates to show performance in real terms instead of merely ‗spinning his wheels‘ with a great flurry of activity and without showing results. an expression of confidence that the individual to whom duties are assigned will discharge them in manner which satisfies the intention of the assignor.thinking principle: Delegation. o It helps the superior to set up standards for the job which will lend themselves as standard of performance.Principles and Practices of Management ADL 01 Act of trust: Delegation is an act of trust. Dependency relationship: Unfortunately. Forward. The obligation of a subordinate to perform the assigned duty as required by the superior. delegation creates a relationship of dependency between superior and the subordinate. is the ‗most forward-thinking principle‘. It opens a new chapter in superior subordinate relationships. . from a behavioral point of view. The fear of being ultimately responsible compels many managers to indulge in under-delegation. Principles of Delegation Principle of delegation by results: This principle suggests that work and authority should be delegated to the lowest organizational level commensurate with the ability of subordinates to perform. Delegation means freedom of action sufficient to get the task accomplished.

activities to be undertaken organization authority delegated and relationships created are vital. Principle of parity of authority and responsibility: Effective delegation requires that the authority to utilize resources be equal to the responsibility assigned to the subordinate. the person should be given the necessary authority to carry out that activity.Principles and Practices of Management ADL 01 Principle of functional definition: Effective coordination demands a clear definition. Delegation. If a person is going to be responsible for an activity. Clear definition of results expected. responsibility and accountability. in no way implies abdication. Advantages of Delegation Superior related advantages Subordinate related advantages Improves behavioral climate Advantages to organization How to Delegate Effectively? . of authority and responsibility for all decision and work. Principle of absoluteness of responsibility: Delegator is not a sage. he should be allowed to use his judgment and decision-making capacities in finding an appropriate way to show performance. Scalar principle: The scalar principle states that authority and responsibility should flow in clear and unbroken line from top to the bottom of the organization. Principle of unity of command: The unity of command principle states that for any given activity an employee should be made accountable to only one superior. Authority level principle: This principle demands that once a subordinate is assigned some work and is given authority to do it. preferably in writing. The process of delegation does not relieve the superior of any of his authority.

Define responsibility and authority: It is always better to put it in writing the authority. responsibility and relationships of each executive in the organization. successful delegation can also be identified as ‗delegation by objectives‘. Establish adequate Controls: Establish adequate standards against which the subordinate can measure and evaluate his own performance. Require completed work: The superior should put the subordinate completely on his own once authority is delegated. The effective manager should be able to motivate the subordinates and get things done.Principles and Practices of Management ADL 01 Establish goals: Just as effective management can truly be said to be management by objectives. Provide training: The superior should teach subordinates how to improve their job performance. . A person to whom work is being delegated wants to know why he is being asked to it. and refuse him access until the subordinate has completed the job. Self-control is more effective than a system of external control imposed. Motivate subordinates: Motivation is the moving force in delegation.

Establishing the relationships d. One of the following is not a process of organizing…………… a. 4. Formal organization b.Principles and Practices of Management ADL 01 Review questions 1. The official structures and systems consciously designed by organizational members to accomplish organizational goals a. Informal organization c. Explain authority and delegation of authority in detail..is a means of dividing a large and complex organization into smaller. ……………. Describe the principles of organizations. flexible administrative units. Departmentation b. All the above 2. What are various sources of authority? 5. Division of work c. Organizational c. The term organization structure describes the …………. Division . Elaborately discuss the various bases of Departmentation. Test your understanding 1. Framework a. Regional 3. a. Define organizations and discuss how managers perform in organizations? 2. Delegating authority 4. Leading b. 3. Classical organization d. Functional d. Social b.

. Grouping d. 5 9. Delegation d. ………………. Authority c. Specification 5. 4 d. a. Matrix c. a. Delegation d. ………………structure organizations simultaneously integrate and use two or more organizational structures a. Principle. None 8.states that for any given activity an employee should be made accountable to only one superior. According to ……………. 3 c. Responsibility b.. Team b.. Delegation process involves …………. a. ……………. Vertical d.distinct stages. Principle of unity of command .is the capacity of a superior to make decision affecting the behavior of subordinates a. Authority c. Span 7. a manager should be able to handle what number of employees under him should be decided.Principles and Practices of Management ADL 01 c. Virtual 6. Controlling b. 2 b.

A 4. an expression of confidence. All the above 10. A . Organizing Answer key 1. ………………. A 5. A 10. Authority c. Delegation b. is an act of trust. B 6. A 2. C 9.Principles and Practices of Management ADL 01 b. B 8. Coordination d. B 3. a. Scalar chain d. Authority principle c. D 7.

Principles and Practices of Management ADL 01 Chapter 4 Staffing .

Staffing function is the most important managerial act along with planning. 2. The operations of these four functions depend upon the manpower which is available through staffing function. Recruitment and selection vii. For an organization to achieve its goal. It involves the determination of what personnel are needed in what quantity and of what quality. Broadly speaking. Promotion and transfer Meaning of Staffing Staffing is the process of matching the jobs with the capable people. . human factor is the most important. Job Analysis vi. Performance Appraisals ix. It is concerned with attracting. Nature of Staffing Function 1. directing and controlling. developing and evaluating individuals at work. it must perform the important function of staffing in its business processes. Meaning of Staffing ii. Nature of Staffing Function iii.Principles and Practices of Management ADL 01 Chapter outline i. Staffing is an important managerial function. Human Resource Planning or Manpower Planning v. . Staffing is a pervasive activity. organizing. Among the various factors of production which are used in an organization. Elements of staffing process iv. staffing is concerned with the management of human beings in an organization. Training and Development viii.As staffing function is carried out by all mangers and in all types of concerns where business activities are carried out.

Staffing helps in placing right men at the right job. Human Resource Planning or Manpower Planning The first step in the staffing process is to estimate the requirement of employees. 4. etc. that is. 5. training and development. etc. recruitment. size of the company. selection. I .Human resources can be efficiently managed by a system or proper procedure. Staffing is performed by all managers depending upon the nature of business. Elements of staffing process The following elements are involved in staffing process: Human Resource Planning or Manpower Planning Job Analysis Recruitment and selection Training and Development Performance Appraisals These topics will be covered in detail in the following section. it is performed especially by the personnel department of that concern. In medium and small scale enterprise.This is because staffing function continues throughout the life of an organization due to the transfers and promotions that take place. placement. 6.Principles and Practices of Management ADL 01 3. qualifications and skills of managers. The basis of staffing function is efficient management of personnels. While estimating the number and type of human resource required. the top management generally performs this function. It can be done effectively through proper recruitment procedures and then finally selecting the most suitable candidate as per the job requirements. Staffing is a continuous activity. In small companies. providing remuneration. the specific job need should be .

Purpose of HR Planning Effective HR Planning Right people Right capabilities Right time Right place Objectives of Manpower Planning Right sizing It is essential to hire the manpower in the right number. Essentially this is the process of getting the right number of qualified people into the right job at the right time. Staffing is to forecast and determine a firm‘s future demand and supply of the right manpower in the right number.. It is a forward looking function. If organizations overdo the size of their workforce it will carry surplus or underutilized staff. if there is deficiency in the staff strength it will make it difficult or impossible to meet production or service deadlines.Principles and Practices of Management ADL 01 kept in mind. Alternatively. There is a . Retain talent The HR manager should use initiatives to attract and retain qualified and skilled personnel.. Manpower Planning helps in preventing shortages arising out of poaching etc. It is only after this that HRM department can begin with the process of recruitment and selection.

Cut costs How to reduce the workforce while at the same time protecting the long-term interests of the organization brings in the need for HR planning. Environmental scanning to understand the labor supply changes: . Such candidates are rolled over various jobs and assisted continuously. Succession planning It identifies star performers or the successors in the replacement chart.Principles and Practices of Management ADL 01 growing resistance among employees to change and move around anywhere and anytime the organization wants. thus increasing the importance and necessity of planning ahead. The process of human resource planning It consists of the following steps as depicted in figure below- FIGURE 2-7 HR Planning Process 1.

Developing HR Strategies to manage shortages in shortage of resource and excess of employees in the organization II.Principles and Practices of Management ADL 01 The process involves studying the external environment of the organization to pinpoint opportunities and threats in planning the human resources. Political. Forecasts are done using the information on human resource from the past and present to identify expected future conditions. Forecasts can be of two types – HR Demand (Employees needed for future) – HR Supply ( Employees available for the future) 4. Legal. skills. Competition. work-force composition. Assessing the Internal Workforce It is analyzing and understanding the internal environment or the capabilities of the current Human Resource available in the organization. It provides information regarding the followingWhat jobs exist now? How many individuals are performing each job? What are the reporting relationships of jobs? How essential is each job? What jobs will be needed to implement future organizational strategies? What are the characteristics of anticipated jobs? 3. and abilities. 2. Job analysis . Forecasting HR Supply and Demand Forecasting is about estimating how many employees a firm would require in future. Social and Technical changes. It includes all the information about employees‘ knowledge. Various statistical techniques are used for forecasting. Challenges arise from three important sources such as Economic Developments.

working conditions and hazards form part of job description. machines. communications skills and the like are a part of job specification. experience. observations or critical incident investigations. Education. not the person. outcomes and work environment. tools and equipment. JOB DESCRIPTION indicates what all a job involves – tasks and responsibilities required for a job. skills. not a description of the person. Job titles. skills. the product of the analysis is a description and specifications of the job. The process of job analysis is depicted in the following diagram- The Process of Job Analysis . questionnaires. training. While Job Analysis data may be collected from incumbents through interviews. duties. duties. An important concept of Job Analysis is that the analysis is conducted of the Job.Principles and Practices of Management ADL 01 It is a process of collecting job related information like task. judgment. JOB SPECIFICATION is the capabilities that the job-holder should possess.

Purpose and importance of recruitment The general purpose of recruitment is to provide a pool of potentially qualified candidates. etc. Relationships Supervision given and received. Relationships with internal or external people. These items need to be specified in a Job Analysis. and abilities (KSA's) required to perform the job. and dangerous explosives. Theoretically. it can move for recruitment. duration. hostile and aggressive people. complexity. in reality. It is a process of searching for and obtaining as many applicants as possible for jobs. Recruitment and selection After the organization has done Manpower planning and Job analysis. radioactive substances. skill. Specifically. There may also be definite risks to the incumbent such as noxious fumes. Tools and Equipment Some duties and tasks are performed using specific equipment and tools. Equipment may include protective clothing. effort. from among whom the right candidate can be selected. the purposes are to: . Information to be collected about these items may include: frequency. skills. the recruitment process ends here but. equipment. Requirements The knowledge. The work environment may include unpleasant conditions such as offensive odors and temperature extremes. standards. While an incumbent may have higher KSA's than those required for the job. Environment This may have a significant impact on the physical requirements to be able to perform a job. a Job Analysis typically only states the minimum requirements to perform the job III.Principles and Practices of Management ADL 01 Information collected through job analysis Duties and Tasks The basic unit of a job is the performance of specific tasks and duties. the term is used to describe the entire process of employee hiring.

. d) Help reduce the probability that job applicants. b) Increase the pool of candidates at minimum cost. will leave the organization only after a short period of time. Sources of recruitment Every organization has the option of choosing the candidates for its recruitment sources: internal and external sources.Principles and Practices of Management ADL 01 a) Determine the present and future requirements of the firm in conjunction with its personnel-planning and job. Recruitment candidates from all the other sources (like outsourcing agencies etc.analysis activities. g) Increase organizational and individual effectiveness in the short and long term. The sources within the organization itself (like transfer of employees from one department to other.) are known as the external sources of recruitment. h) Evaluate the effectiveness of various recruiting techniques and sources for all types of job applicants. e) Meet the organization‘s legal and social obligations regarding the composition of its workforce. c) Help increase the success rate of the selection process by reducing the number of visibly under qualified or over qualified job applicants. once recruited and selected. f) Begin identifying and preparing potential job applicants who will be appropriate candidates. promotions) to fill a position are known as the internal sources of recruitment.

Principles and Practices of Management ADL 01 SOURCES OF RECRUITMENT ARE OF TWO KINDS .

Organizations need qualified and competent people to gain competitive advantage. Selection To select means to choose. It is the process of choosing individuals with qualifications needed to fill jobs in an organization. It means the very step one starts eliminating the collected . This is one of the important staffing processes.Principles and Practices of Management ADL 01 Advantages and disadvantages of the above sources in simple…. The selection process starts where the recruitment ends..

Interviewing applicants and Administering tests to applicants 2.  Structured or directive interview  An interview following a set sequence of questions.Principles and Practices of Management ADL 01 applications matching the principle of person job fit and/ or person organization fit. There are two formats while conducting an interview process  Unstructured or nondirective interview  An unstructured conversational-style interview in which the interviewer pursues points of interest as they come up in response to questions. Interviews are procedure designed to obtain information from a person through oral responses to oral inquiries.A series of job-related questions that focus on relevant past jobrelated behaviors. Conducting background investigations 3. The short listing of the application depends on the knowledge. the selection starts.A series of job-related questions that focus on how they reacted to actual situations in the past. skills and abilities matching with the job descriptions of the profile opened up. . Other tests include personality tests. There are various steps involved in the selection process before the hiring decision and it depends upon the organization in choosing the most appropriate method of selection. Arranging physical examinations 4. Based on the above formats an interview can be  Situational interview- A series of job-related questions that focus on how the candidate would behave in a given situation. The short listing can be done through administrating tests and interviews. Ability tests are those tests to test aptitude and achievement of the applicants. Employment Interviews are the most common used method in hiring decisions. Offer and placement Once the applications are received the short listing begins. honesty and integrity tests. The are depicted in the following1.  Job-related interview.  Behavioral interview.

. • Misunderstanding the job – Not knowing precisely what the job entails and what sort of candidate is best suited causes interviewers to make decisions based on incorrect stereotypes of what a good applicant is.An interview in which the interviewer seeks to make the applicant uncomfortable with occasionally rude questions that supposedly to spot sensitive applicants and those with low or high stress tolerance.  Panel interview - An interview in which a group of interviewers questions the applicant. • Candidate-order error – An error of judgment on the part of the interviewer due to interviewing one or more very good or very bad candidates just before the interview in question. candidates‘ background are verified and checked. On a conditional offer the process of physical examinations are conducted.A panel interviews several candidates simultaneously. and other types of jobs use questions to pose problems requiring unique (―out-of-the-box‖) solutions to see how candidates think under pressure. finance.Recruiters for technical.  Puzzle questions . – Negative bias: unfavorable information about an applicant influences interviewers more than does positive information.Principles and Practices of Management ADL 01  Stress interview . After interviews and tests.  Mass interview . Factors Affecting Interviews • First impressions – The tendency for interviewers to jump to conclusions and make snap judgments about candidates during the first few minutes of the interview. • Nonverbal behavior – Interviewers‘ inferences of the interviewee‘s personality from the way he or she acts in the interview have a large impact on the interviewer‘s rating of the interviewee.

Training is conducted by a systematic approach. Development is efforts that are oriented more toward broadening an individual‘s skills for the future responsibilities. training is an effort initiated by the organization to foster learning among its members. gender. race – Interviewers tend have a less favorable view of candidates who are: • Physically unattractive • Female • Of a different racial background • Disabled Making the job offer Finally on the hiring decision the formal job offer is done. On-the-job training has a general reputation as most effective for vocational work. A letter of offer is given by the organization on which in return the candidates sign their acceptance of the offer. On the Job Training -takes place in a normal working situation. documents or materials that trainees will use when fully trained. It tends to be narrowly focused and is oriented towards short-term performance concerns. using the actual tools equipment. Developing the human resources Once the employee joins the organization. he/she has to undergo training in order to acquire the skill sets required to perform the job. There are two methods used in training. The training needs of individuals are identified and then training is provided.Principles and Practices of Management ADL 01 • Effect of personal characteristics: attractiveness. The on job training and the off job training. This can be imparted by the following ways: Coaching and mentoring Job Rotation Job instruction training . Thus.

Performance Appraisals It is the process of obtaining. Therefore. It has the advantage that it allows people to get away from work and concentrate more thoroughly on the training itself. if this informal learning is used as a formal process then it is regarded as management development. Managers are exposed to learning opportunities whilst doing their jobs. investment in Management Development can have a direct economic benefit to the organization. Management Development is best described as the process from which managers learn and improve their skills not only to benefit themselves but also their employing organizations. It can be imparted by – • On-the-Job Experiences • Seminars and Conferences • Case Studies • Management Games • Role Playing • Behavior Modeling It would be wise to mention here about Management Development. analyzing and recording information about the relative worth of an employee. Its aim is to . The focus of the performance appraisal is measuring and improving the actual performance of the employee and also the future potential of the employee.Principles and Practices of Management ADL 01 Apprenticeship training Orientation training Off the Job Training -takes place away from normal work situations — implying that the employee does not count as a directly productive worker while such training takes place.

refine and reward the performance of the employee. – Appraisals help in planning for correcting deficiencies and reinforce things done correctly.  To assess the training and development need.  To improve communication.  To decide upon a pay raise. . Why appraise performance? – Appraisals play an integral role in the employer‘s performance management process.  It can also be used to determine whether HR Programs such as selection. are useful for career planning – Appraisals affect the employer‘s salary raise decisions. – Appraisals. OBJECTIVES OF APPRAISAL  To effect promotions based on competency and performance. training. and improves understanding of personal goals and concerns. It is a systematic way of reviewing and assessing the performance of an employee during a given period of time and planning for his future. It is a powerful tool to calibrate.  To let the employees know where they stand insofar as their performance is concerned and to assist them with the constructive criticism and guidance for the purpose of their development.Principles and Practices of Management ADL 01 measure what an employee does.  To confirm the services of probationary employees upon their completing the probationary period satisfactorily. It helps to analyze his achievements and evaluate his contribution towards the achievements of the overall organizational goals. Appraisal provides a format for dialogue between the supervisor and the subordinate. and transfers have been effective or not. in identifying employee strengths and weaknesses.

The employees should be informed and the standards should be clearly explained to the standards.Principles and Practices of Management ADL 01 Steps in Appraising Performance • Defining the job and establishing standards The first step in the process of performance appraisal is the setting up of the standards which will be used to as the base to compare the actual performance of the employees. this usually involves some type of rating form. The result can show the actual performance being more than the desired performance or. it is the responsibility of the management to communicate the standards to all the employees of the organization. How to measure? Actual performance of employees can be measure any of the following methods. Once set. It includes recalling. the actual performance being less than the desired performance depicting a negative deviation in the organizational performance. It is a continuous process which involves monitoring the performance throughout the year. This stage requires the careful selection of the appropriate techniques of measurement. evaluating and analysis of data related to the employees‘ performance. • Appraising performance Comparing your subordinate‘s actual performance to the standards that have been set. It is making sure that superior and subordinate agree on his or her duties and job standards. The actual performance is compared with the desired or the standard performance. o Graphic rating scales . taking care that personal bias does not affect the outcome of the process and providing assistance rather than interfering in an employees work. This step requires setting the criteria to judge the performance of the employees as successful or unsuccessful and the degrees of their contribution to the organizational goals and objectives. The comparison tells the deviations in the performance of the employees from the standards set.

The scale looks like the following- o Paired comparison method It is the process of ranking employees by making a chart of all possible pairs of the employees for each trait and indicating which is the better employee of the pair designed. choosing highest. then lowest.Principles and Practices of Management ADL 01 A scale that lists a number of traits ( such as quality and reliability) and a range of performance values (from satisfactory – unsatisfactory) for each trait that is used to identify the score that best describes an employee‘s level of performance for each trait. o Forced distribution method . o Alternation ranking method In this method employees are ranked from best to worst on a particular trait. until all are ranked.

o Critical incident method Here the appraiser or the superior keeps a record of uncommonly good or undesirable examples of an employee‘s work related behaviour and reviews it with the employee at predetermined times. .management by objectives It involves setting specific measurable goals with each employee and then periodically reviewing the progress made.Behaviorally anchored rating scale It is an appraisal method that uses quantified scale with specific narrative examples of good and poor performance. predetermined percentages of ratees are placed in various performance categories. o Narrative forms It is a subjective way of analyzing the records of past performance and suggest areas of improvement o BARS.Principles and Practices of Management ADL 01 Similar to grading on a curve. Developing BARS involves the following process: – Generate critical incidents – Develop performance dimensions – Reallocate incidents – Scale the incidents – Develop a final instrument o MBO.

The purpose of the meeting should be to solve the problems faced and motivate the employees to perform better. and making plans for any development required. The result of the appraisal is communicated and discussed with the employees on one-to-one basis. DECISION MAKING . The results. The focus of this discussion is on communication and listening. the problems and the possible solutions are discussed with the aim of problem solving and reaching consensus. The feedback should be given with a positive attitude as this can have an effect on the employees‘ future performance.Principles and Practices of Management ADL 01 Advantages and Disadvantages of Appraisal Tools • Providing feedback It is the process of discussing the subordinate‘s performance and progress.

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The last step of the process is to take decisions which can be taken either to improve the
performance of the employees, take the required corrective actions, or the related HR
decisions like rewards, promotions, demotions, transfers etc.
REWARDS AND RECOGNITION
After appraising the employees, it is essential for the management to recognize the efforts and
hard work put in by the employees and rewards them for their outstanding performance. This
not only boosts their morale but also motivate them to enhance their performance.
Rewards and Recognition programs are generally less expensive than base pay. Top
objectives for recognition programs include motivating high performance, reinforcing desired
behaviors and creating a positive work environment.
Recognition programs have grown over the years from informal ―thank you‘s‖ to plans with a
written strategy and more defined budget. Even small increases in supportive practices are
associated with decreased turnover and increased sales/profitability. Employees who feel that
their organization values them are more likely to value their customers. Appreciation and/or
praise are among the top three drivers of employee motivation and engagement across a
variety of industries and companies.
Organizational rewards take a number of different form including money (salary, bonuses,
incentive pay), recognition and benefits.
PROMOTIONS AND TRANSFERS - Promotions and transfers provide employees with the
opportunity to develop their skills and talents, which can contribute to their career growth and
advancement.
A Promotion is a move from the employee‘s current position into a different
position in a higher salary grade.

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A Transfer is a move to any other job in another department. A transfer can
be to a higher-grade level (a promotional transfer) or at the same level (a
lateral transfer).

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Review questions
1. Accurate appraisal of performance is difficult. In the light of this discuss the problems
involved in appraising an employee.
2. What are the various sources of recruitment? How can organizations evaluate which
source is best?
3. Explain the selection process in detail.
4. Training program is helpful to avoid employee obsolescence. Discuss.
5. What is on job training? Discuss the methods.
Test your understanding
1. Staffing is concerned with the management of ……….in an organization.
a. Human beings
b. Machines
c. Jobs
d. None
2. ………….is the method of comparing subordinate‘s actual performance to the
standards that have been set
a. Appraising performance
b. Reward management
c. Compensation management
d. Balanced scorecard
3. A series of job-related questions that focus on how the candidate would behave in a
given situation is called………..
a. Behavioral interview
b. Situational interview

Principles and Practices of Management ADL 01 c.is best described as the process from which managers learn and improve their skills not only to benefit themselves but also their employing organizations. MBO . None 7. In this method a scale that lists a number of traits and a range of performance values for each trait that is used to identify the score that best describes an employee‘s level of performance for each trait…………. Is a method in which a group of interviewers questions the applicant a. Stress interview 5. Situation a. Panel interview b. Absence of machines 6. Class room c. Situational interview c. All the above 4. Behavioral interview d. Career development c. Normal working b. a. ………………. a. Informal setting d. ……………….. Management Development b. Human resource planning d. Stress interview d. On the Job Training take place in a ………….

A 3. Exit 10.. a.involves setting specific measurable goals with each employee and then periodically reviewing the progress made. B . Graphic rating scales c.is a move from the employee‘s current position into a different position in a higher salary grade. Paired comparison method c. Demotion d. a. A …………. Transfer c. Graphic rating scales b.. ………………. Management by objectives d. Behavior Modeling Answer key 1.Principles and Practices of Management ADL 01 b. Orientation training b. Paired comparison method d. A 2. Management Games c. Management by exception 9. One of the following methods is not Off the Job Training……………. Role Playing d. Alternation ranking method 8. a. Promotion b.

A 6. A . A 10. B 8. C 9.Principles and Practices of Management ADL 01 4. A 7. A 5.

Principles and Practices of Management ADL 01 Chapter 5 Direction .

Importance of directing iv. leading and supervising the subordinates to accomplish desired objectives. What is direction? ii. Importance of motivation xiv.Principles and Practices of Management ADL 01 Chapter outline i. direction is telling people what to do and seeing that they do it to the best of their ability. the structure being designed. Types of decisions ix. Features of directing iii. Principles of direction v. Motivation process xv.Process xii. According to Dale. Once the organizational plans have been laid down. Direction is the managerial function of guiding. Elements of direction vi. It consists of: . The decision-making process x. Management by objective-concepts and features xi. Theories of motivation WHAT IS DIRECTION? Direction represents one of the essential functions of management because it deals with human relations. motivating. Communication. Decision making vii. Motivation xiii. Characteristics of decision-making viii. direction starts. and competent people brought in to fill various positions in organization.

Pervasive: Direction is performed by all managers at all levels of an organization. a complex function as managers have to deal with people having diverse goals. Dynamic and continuous: Direction is a dynamic and continuing activity of managers. managers supervise the performance of subordinates and integrate effort at various levels. good working environment. therefore. the time spent on these activities decreases at higher levels of authority. advising and helping subordinates in the proper methods of work (Leadership) Motivating them to achieve goals by providing incentives. etc (Motivation) Supervising subordinates to ensure compliance with plans (Supervision) FEATURES It has the following features: Deals with people: People are not primarily interested in enterprise objectives. Provides a link: Direction provides an important link between different functions in an organization. To obtain results. However. they have objectives of their own. the individual goals and organizational goals would never intermesh. It is also called as on actuating function of management because it is through direction that the operation of an .Principles and Practices of Management ADL 01 Issuing orders and instructions by a superior to his subordinates (Communication) Guiding. Directing is. Seeks performance: Direction translates plans into action and makes people goaloriented. It is an ongoing activity of managers. IMPORTANCE OF DIRECTING A few philosophers call Direction as ―Life spark of an enterprise‖. Without direction. A manager has to modify the techniques of direction in order to keep pace with changing times.

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enterprise actually starts. Being the central character of enterprise, it provides many benefits
to a concern which are as follows:1. It Initiates Actions – Directions is the function which is the starting point of the work
performance of subordinates. It is from this function the action takes place,
subordinates understand their jobs and do according to the instructions laid. Whatever
are plans laid, can be implemented only once the actual work starts. It is there that
direction becomes beneficial.
2. It Ingrates Efforts – Through direction, the superiors are able to guide, inspire and
instruct the subordinates to work. For this, efforts of every individual towards
accomplishment of goals are required. It is through direction the efforts of every
department can be related and integrated with others. This can be done through
persuasive leadership and effective communication. Integration of efforts bring
effectiveness and stability in a concern.
3. Means of Motivation – Direction function helps in achievement of goals. A manager
makes use of the element of motivation here to improve the performances of
subordinates. This can be done by providing incentives or compensation, whether
monetary or non – monetary, which serves as a ―Morale booster‖ to the subordinates
Motivation is also helpful for the subordinates to give the best of their abilities which
ultimately helps in growth.
4. It Provides Stability – Stability and balance in concern becomes very important for
long term sun survival in the market. This can be brought upon by the managers with
the help of four tools or elements of direction function – judicious blend of persuasive
leadership, effective communication, strict supervision and efficient motivation.
Stability is very important since that is an index of growth of an enterprise. Therefore
a manager can use of all the four traits in him so that performance standards can be
maintained.
5. Coping up with the changes – It is a human behaviour that human beings show
resistance to change. Adaptability with changing environment helps in sustaining

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planned growth and becoming a market leader. It is directing function which is of use
to meet with changes in environment, both internal as external. Effective
communication helps in coping up with the changes. It is the role of manager here to
communicate the nature and contents of changes very clearly to the subordinates. This
helps in clarifications, easy adaptations and smooth running of an enterprise. For
example, if a concern shifts from handlooms to power looms, an important change in
technique of production takes place. The resulting factors are less of manpower and
more of machinery. This can be resisted by the subordinates. The manager here can
explain that the change was in the benefit of the subordinates. Through more
mechanization, production increases and thereby the profits. Indirectly, the
subordinates are benefited out of that in form of higher remuneration.
6. Efficient Utilization of Resources – Direction finance helps in clarifying the role of
every subordinate towards his work. The resources can be utilized properly only when
wastages, duplication of efforts, overlapping of performances, etc. doesn‘t take place.
Through direction, the role of subordinates become clear as manager makes use of his
supervisory, the guidance, the instructions and motivation skill to inspire the
subordinates. This helps in maximum possible utilization of resources of men,
machine, materials and money which helps in reducing costs and increasing profits.
PRINCIPLES OF DIRECTION
Important principles of direction may be summarized thus:
1. Principle of harmony of objectives: direction function must, first of all, resolve
the conflict between individual goals and organizational objectives. A manager
must foster the sense of belonging to the organization among the individuals so
that they can identify themselves with the company. When both the interests are
integrated, contribution of subordinates to the company will be maximum.

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2. Principle of unify of command: A sound principle of direction is that the
subordinates should receive orders from one superior. Dual subordination brings
disorder confusion, chaos, and undermines the authority of a superior.
3. Principle of direct supervision: Direct supervision makes the subordinates happy
and boosts their morale. It also ensures quick feedback of necessary information.
4. Appropriate techniques: The technique used for direction should be appropriate
to the people, the task and the situation. Democratic style may work in some case
but autocratic style may produce results in certain other cases especially where
subordinates are incapable of doing things on their own.
5. Managerial communication: Two-way communication is an important part of
direction. The manager should explain the policies and practices to subordinates
and the results expected of them. The manager should encourage subordinates to
express their views.
6. Informal organization: Managers should make use of informal groups to
supplement, support and strengthen the formal structure.
7. Principle of maximum individual contribution: The manager should inspire the
subordinates in such a way that they contribute their maximum while realizing
organizational objectives.
8. Use of motivation techniques: A manager should know how to motivate and
inspire employees. Motivation leads to higher job satisfaction.
9. Principle of follow-up: Direction is concerned with ensuring that people do what
they are told to do. This requires continuous feedback.
ELEMENTS OF DIRECTION
According to William Newman the directing function of management consists of the
following elements (a) issuing orders and instruction to subordinates,
(b) follow-up of instruction

The order should be clear and easily understandable. 2. To promote better execution of the order a manager before serving it must discuss the order with the people involved in it. CHARACTERISTICS OF A GOOD ORDER 1. 8. It should be compatible with the overall objectives of the organisation. 5. 7. All orders should follow the chain of command. Hence written instructions are promoted. (e) consultative direction Every instruction given by the manager in the process of directing the employees must be reasonable. This helps in ensuring uniform actions everywhere. 6. 3. complete and clear.Principles and Practices of Management ADL 01 (c) standard practices and indoctrination. The instruction issued must promote standard practices. It should be reasonable and attainable. It half saves the time because of simplification of the instructions. It must indicate the time period within which it should be carried out and completed. . The tone of the order should be appropriate and should stimulate ready acceptance. The order of direction vocally discuss time and matter that had be instructed. (d) explanations. Explanations on the order that is the why part of it must be explained by the manager giving instructions. It must be complete in all respects leaving no doubt in the minds of subordinates as to what is expected of them. It should preferably be in writing. Orders there of executed are properly followed up to understand whether it is executed or not. 4.

. 10. so that action may take place.i. the manager should explain the purpose behind. 2. Decision-making is the process by which individuals select a course of action among several alternatives. When issuing the order. it is the selection of course of action needed to solve problem. These directed orders are supervised by the mangers. The intention is to move‘ toward some desired state of affairs‘. to achieve at decisions and for alternative solutions. it contains conscious and unconscious aspects. Alternatives: A decision is characterized by two activities.. to produce a desired result. 3. Choice leads to decision.search and choice. A decision is a choice made from available alternatives. WHAT IS DECISION MAKING? In fact what so ever a manager does they do by decision making. CHARACTERISTICES OF DECISION-MAKING The important characteristics of decision-making are: 1. The manager searches for opportunities.Principles and Practices of Management ADL 01 9. Goal-oriented: Decisions are made to achieve some goal.e.making has both the intuitive and deductive logic. Part of it can be learned but part of it depends upon the personal characteristics of the decision maker. The order should be regularly followed up and incorporate suggestions given by subordinates when it is reissued. why it is being given. Analytical-intellectual: Decision.

For example. lop off divisions and extend the golden handshake to thousands of workers. It is not a one shot deal. For example. 6. Human and social process: Decision-making is a human and social process involving intellectual abilities. a manager may hire people based on merit regularly and also pick up candidates recommended by an influential party. 8. Dynamic process: Decision-making is the process by which individuals select s course of action among several alternatives to produce a desired result. intuition and judgement. the organization moves in a specific direction. Depending on the situation requirements. 7. Pervasive function: Decision-making permeates all management and covers every part of an enterprise. in a labour surplus. 9. in order to achieve the goals. 5. at times. Commitment of time. effort and money. Once a decision is made. The commitment may be for short term or long term depending on the types of decision (e.g. in fact of intense competition.Principles and Practices of Management ADL 01 4. Both are intellectual processes. Integral part of planning: As Koontz indicated. capital-hungry country like Indian managers cannot suddenly shut down plants. effort and money: Decision-making implies commitment of time. demanding . strategic. The end products of a manager‘s work are decisions and actions. managers take suitable decisions using discretion and judgement. ‗decision making is the core of planning‘. Continuous activity: Manager decides things on continual and regular basis. tactical or operating).

For example. BASIC AND ROUTINE DECISIONS Basic decisions are unique. a supervisor can decide. Such decisions are taken by managers in their individual capacity. decisions about launching a new product. or buying a more advanced computer system. Both aim at achieving goals. For example. lower-level managers look after such decisions. on the pat of managers. TYPES OF DECISIONS The quality of decision making skills is one the critical success factors for managers. They require little deliberation and generally concerned with short-term commitments. They require creativeness. Both involve choice among alternative courses of action. Routine decisions are repetitive in nature. one-time decisions demanding large investments. creativeness and good judgement on the part of managers. As a manager progresses to higher levels. PERSONAL AND ORGANISATIONAL DECISIONS Decisions to watch television. whether an employee‘s absence is excused or unexcused. . They are strategic decisions which affect the future of an organization.Principles and Practices of Management ADL 01 discretion and judgement. These cannot be delegated. to study or retire early are examples of personal decisions. are non-routine decisions. number of basic decisions increase. Generally. on the basis of personnel policy guidelines. Both are situational in nature. intuition and good judgement. So it would be useful to understand the ways in which decisions are made.

The Made by lower-level people. CHARACTERISTICS OF PROGRAMMED AND NON-PROGRAMMED DECISIONS PROGRAMMED DECISIONS NON-PROGRAMMED DECISIONS Problems are routine and repetitive. Organizational decisions are made by managers in their official or formal capacity. It includes not only decision-making but also the implementation. .Principles and Practices of Management ADL 01 Personal decisions can ‗have an impact beyond the immediate system on whose behalf they were made‘. Top management responsibility. is poorly defined and largely unstructured and influences important consequences of the organization. policies or procedures to rely on. to correct an unsatisfactory situation. rule. They are aimed at furthering the interests of the organization. Solutions are offered in accordance These with some habit. decisions are highly certain. Non-programmed are made in response to a situation that is unique. programmed decisions are highly conditions for non- uncertain. Problems are unique and novel. monitoring and maintenance of the decision. PROGRAMMED AND UNPROGRAMMED DECISIONS Problem solving refers to a broad set of activities that involves finding and implementing a course of action. or procedure. Programmed decision is fairly structured or recurs with some frequency(or both). are no pre-established Each situation is different and needs The conditions for programmed a creative solution.

the following questions should be looked into: What is the problem? Which problem to solve? What is the real cause of the problem? . he must state the real problem. In order to state the true problems. At this stage. Problems arise due to disparity between what is and what should be.Principles and Practices of Management ADL 01 THE DECISION-MAKING PROCESS Awareness Diagnose Develop Evaluate Select Implement of and the the the and verify Problem State Alternatives Alternatives best alternative the decision the Problem FEEDBACK Awareness of a problem: The first step in the decision-making process is recognising the problem. Diagnose and state the problem: Once manager become aware of a problem. the emphasis should be on defining the questions in the right way rather than finding answers to the questions.

the standards to be taken as the criteria for measurement of performance and contribution and deciding the course of action to be followed. Evaluate the alternative: In this step. It can be defined as a process whereby the superiors and the employers come together to identify common goals. of each courses of action against the expected gains. Peter Drucker has offered four criteria. Economy of effort: The alternative that will give the greatest output for the least inputs. the decision maker selects the alternative that will maximize the results in terms of existing objectives. Limitation of resources: Physical. Select the best alternative: In this step. MANAGEMENT BY OBJECTIVE The concept of ‗MBO‘ was first given by Peter Drucker in 1954. . the best alternative is the one that dramatises the decision and if consistent effort is needed. Timing: If the situation has urgency. the employees set their goals to be achieved . It helps managers to test the soundness of every proposal before it is finally translated into action.Principles and Practices of Management ADL 01 Develop the alternatives: Developing alternative solutions gurantees adequate focus and attention on the problem. the decision maker tries to outline the advantages and disadvantages of each alternative. the manager must implement it and seek feedback regarding the effectiveness of the implemented solutions. for making the right choice among available alternatives: The risk: the manager has to weight the risks. a slow start is preferable. Implement and verify the decision: After making a decision. financial and human resources impose a limitation on the choice of selection. The consequences of each alternative would be considered.

Rewards / Punishments 1. FEATURES OF MBO MBO emphasis participation in setting goals that is tangible. MBO is a systematic and rational technique that allows management to attain maximum results from available resources by focusing on achievable goals. Providing Employee Feedback Objectives 4.Principles and Practices of Management ADL 01 Therefore the essence of MBO is participative goal setting. Continuous monitoring of performance progress . Define Organization goal 2. choosing course of actions and decision-making. MBO is a dynamic system which seeks to integrate the company‘s need to achieve its goal. Ideally. when employees themselves have been involved with the goal setting and the choosing of the course of action to be followed by them. Performance Evaluation / Review 3. verifiable and measurable. THE MBO PROCESS 6. Define 5. they are more likely to fulfill their responsibilities. An important part of the MBO is the measurement and the comparison of the employee‘s actual performance with the standards set.

Focus is on future rather than on past. Managers can ensure that objectives of the subordinates are linked to the organization 's objectives LIMITATIONS OF MBO Pressure oriented Time consuming Increases paperwork Goal-setting problems Organizational problems WHAT IS COMMUNICATION? . Motivated employees because there is involvement of employees in the whole process of goal setting which results in their empowerment and thus commitment. understand their objectives to be achieved and thus help in the achievement of the organizational as well as personal goals.Frequent reviews and interactions between superiors and subordinates helps to maintain harmonious relationships within the enterprise and also solve many problems faced during the period.Principles and Practices of Management ADL 01 The principle behind MBO is to create empowered employees who have clarity of the roles and responsibilities expected from them. ADVANTAGES OF MBO Clarity of goals – SMART goals where S stands for Specific. Better communication and co-ordination . M for Measurable. R for Realistic and T for time-related. A for Achievable.

Second. First. It involves exchange of facts. ideas. Hence a manger must be aware how to communicate effectively. the sender has idea to communicate. begins decoding. receiver gets message.a sender and a receiver Sequential process: It involves several steps. Continuous activity: A manager must always be in touch with his subordinates. Pervasive function: it is essential at all levels of management and in all areas of business. Transfer of meaning and understanding: Effective communication is the process of sending a message in such a way that the message received is a close in meaning as possible. This is the most important aspect in reaching the goal. Third.Principles and Practices of Management ADL 01 Directing happens through communicating the goal. peers and superiors in order to get things done. opinions or emotions by two or more individual. This is called encoding. FEATURES OF COMMUNICATION Two people: Communication always involves two people. Communication refers to the process of passing information and understanding from one person to another. IMPORTANCE OF COMMUNICATION . the idea is translated into a recognizable form.

CHANNELS OF COMMUNICATION There are two types of channels. to strike rapport and to communicate what is contained in the plan. orderly in nature and supports the authority of superiors. Communication keeps the people working in accordance with the desires of managers. Helps to decision-making: Communication provides the right type of information to a manager and enables him to consider the pros and cons.downward. Downward communication .Principles and Practices of Management ADL 01 Communication is important because of following reasons: Basis of action: Getting the right information to and from the correct sources is necessary for an organization to function properly. FORMAL COMMUNICATION: Formal communication is systematic.formal and informal. Improves motivation and morale: Communication improves morale and motivation by keeping people informed. upward and horizontal. There are three ways in which formal communication can go. Facilities planning: Communication helps executives to interact . Improves relationship: Communication builds better relationships among employees working in an organization. Means of coordination: It is only through communication that people can attain a common viewpoint and understanding and cooperate to achieve organizational objectives.

a breakdown in communication occur. INFORMAL COMMUNICATION: Communication channels that do not adhere to the organisation‘s hierarchy is called informal communication.Principles and Practices of Management ADL 01 flows from higher levels to lower ones within an organization. Such attempts lead to message distortion and an incorrect impression of the real situation is created. The best type of informal communication is known as grapevine. BARRIERS TO COMMUNCATION SEMANTIC BARRIERS Semantic is the study of meaning in language. Filtering: Any attempt to alter and colour information to present a more favourable impression is called filtering. Upward communication consists of messages from subordinates to superiors. Lateral communication takes place between people on the same level of the hierarchy. INTERPERSONAL BARRIERS Following are the reasons for interpersonal barriers. Grapevine is an informal communication network among people in an organization that is not officially not sanctioned by the organization. When two individuals attach different meanings to a word. Diagonal communication occurs between people who are neither in the same department nor on the same level of the hierarchy. . The use of jargon creates a barrier to communication. Can‘t express effectively: Some people cannot communicate effectively because they cannot use words and their personality effectively.

values and beliefs-also affect each person‘s perception of a message or of words. and is based on the degree of confidence in the person. Perceptual differences: Perceptual differences-differences in past experience. It is more in the case of highly repetitive material. Emotions: Extreme emotions and jubilation of depression are likely to come in the way of effective communication. Inattention: Inattention is another barrier. The effectiveness of communication is likely to be hampered when managers allow themselves to be inundated with bundles of data. because decisions must be made within specified deadlines.Principles and Practices of Management ADL 01 Credibility: Credibility is based on a person‘s competence in the subject area being communicated. emotions. STRUCTURAL BARRIERS Structural barriers can include: . Individuals try to diminish the worth of another person because they are jealous. Jealousy: Competent individuals are viewed as a threat to the security of peers and subordinates. educational background. Information overload: Managers are flooded with information from various corners. Time pressure: Managers are often subjected to time pressures.

So. The result can prevent employees from having feelings of a united family. in this process to bring efforts related to job performance and satisfaction a manager must understand motivation. . and job jargon can make people feel that they live in different worlds. Status: Communication is also affected by status relationship in the organization. energizes and directs goaloriented behavior. It is a process of stimulating people to action to accomplish desired goals. and leads to errors.Principles and Practices of Management ADL 01 Hierarchy: When organization grows. Superiors are reluctant to discuss important problems with subordinates because this may expose them completely. make understanding very difficult. special interests. Specialization: Different functions. creating many communication problems. WHAT IS MOTIVATION? One of the important duties of managers is to motivate people in the process of getting things done for accomplishment of goals. its structure expands. Motivation is the internal condition that activates behavior and gives it direction. Messages have to pass through several hierarchical levels.

Principles and Practices of Management ADL 01 FEATURES OF MOTIVATION Motivation is an internal feeling: Motivation points to energetic forces within individuals that drive them to behave in certain ways and. it harnesses human energy to organisational requirements. to environmental forces that trigger these drives. . Motivation produces goal-directed behaviour: Motivation has got a profound influence on human behaviour. Motivation contains system orientation: It considers those forces in individuals and their surrounding environments that feedback to the individuals either to reinforce the intensity of their drive and direction of this energy or to dissuade them from their cause of action and reduce their efforts.

financial and human resources to accomplish the goals. For getting best of his work performance. Negative motivation emphasizes penalties while controlling performance. Motivation is different from job satisfaction: Motivation is the drive to satisfy a want or goal. Ex . Satisfaction refers to the contentment experiences when a want is satisfied.Principles and Practices of Management ADL 01 Motivation can be either positive or negative: Positive motivation offers person in the form of additional pay. It is through motivation that the human resources can be utilized by making full use of it. This will help the enterprise in securing best possible utilization of resources. Extrinsic Motivation . This can be done by building willingness in employees to work. Puts human resources into action Every concern requires physical..comes from outside of the performer.Money but Coercion and Threat of punishment are also common extrinsic motivations. This will result into- . incentives. praise etc. for satisfactory performance. It is concerned with goal-directed behaviour. Improves level of efficiency of employees The level of a subordinate or a employee does not only depend upon his qualifications and abilities. the gap between ability and willingness has to be filled which helps in improving the level of performance of subordinates. 2. IMPORTANCE OF MOTIVATION Motivation is a very important for an organization because of the following benefits it provides:1.comes from rewards inherent to a task or activity itself. Ex – Loving your job profile. TYPES: Intrinsic Motivation .

Leads to stability of work force . In order to build a cordial. Disincentives for inefficient employees. Increase in productivity. friendly atmosphere in a concern. b. This could initiate the following things: a. c. Industrial dispute and unrest in employees will reduce. There is a co-operative work environment . Monetary and non-monetary incentives. This would help in: d. c. d. The employees will be adaptable to the changes and there will be no resistance to the change. h. This can be done by keeping into mind and framing an incentive plan for the benefit of the employees. Goals can be achieved if co-ordination and co-operation takes place simultaneously which can be effectively done through motivation. 3. f. There is best possible utilization of resources. the above steps should be taken by a manager. Reducing cost of operations. Builds friendly relationship Motivation is an important factor which brings employees satisfaction. Promotion opportunities for employees. and c.Principles and Practices of Management ADL 01 a. b. g. This will result in profit maximization through increased productivity. 4. Effective co-operation which brings stability. The employees are goal-directed and they act in a purposive manner. Improving overall efficiency. b. Leads to achievement of organizational goals The goals of an enterprise can be achieved only when the following factors take place:a. e. 5. This will help in providing a smooth and sound concern in which individual interests will coincide with the organizational interests.

Motivation Process I NEED DEFIENCIES VI II NEED DEFIOCIENCIES REASSESSED BY THE EMPLOYEE SEARCH FOR WAYS TO SATISFY NEEDS THE EMPLOYEE V III REWARDS AND PUNISHMENT GOAL. the older the people. more the experience and their adjustment into a concern which can be of benefit to the enterprise. This will lead to a good public image in the market which will attract competent and qualified people into a concern. ―Old is gold‖ which suffices with the role of motivation here.DIRECT BEHAVIOR IV PERFORMANCE (EVALUATION OF GOALS ACCOMPOLISHED) THEORIES OF MOTIVATION .Principles and Practices of Management ADL 01 Stability of workforce is very important from the point of view of reputation and goodwill of a concern. As it is said. The employees can remain loyal to the enterprise only when they have a feeling of participation in the management. The skills and efficiency of employees will always be of advantage to employees as well as employees.

MASLOW’S HIERARCHY OF NEEDS THEORY Physiological needs: Physiological needs are biological needs required to preserve human life. the safety needs begin to manifest themselves and dominates human behaviour. content theories. . Safety needs are primarily satisfied through economic behaviour. and recognition. Esteem needs: The esteem needs are concerned with self-respect. Social needs: When social needs become dominant. self-confidence. Reinforcement theories focus on employee learning of desired behaviours. a feeling of personal worth. a person will strive for meaningful relations with others. these needs include needs for food. Safety needs: Once physiological needs become relatively well gratified. feeling of being unique. Self actualisation: Self actualization is the need to maximize one‘s potential. CONTENT THEORIES – Theories that focus on the content of what factors (needs) motivate people. Content theories offer ways to profile or analyze individuals to identify the needs that motivate their behaviour. clothing and shelter. process theories and reinforcement theories. This is related with the development of intrinsic capabilities which lead people to seek situations that can utilize their potential. Knowledge of these theories help a manager in designing the reward mechanisms for the employees.Principles and Practices of Management ADL 01 There are here kinds of theories namely. Process theories seek to understand the thought process that take place in the minds of people and that act to motivate their behaviour.

the theory compresses Maslow‘s five need categories into three: existence needs. relatedness needs. growth needs. In the sense. Alderfer explains the concept of frustration regression principle. Alderfer‘s theory claims that at a given point of time an individual can identify more than one need that motivates him/her and there is no hierarchy or order in the need satisfaction unlike Maslow‘s theory of satisfaction progression principle. A failure to satisfy a need will create regression— .Principles and Practices of Management ADL 01 ALDERFER’S ERG THEORY Alderfer has provided an extension of Maslow‘s need hierarchy.

Principles and Practices of Management ADL 01 reverting to a previously satisfied need after failing to satisfy another need. These needs are satisfied by making productive and creative contributions. The concepts are described as follows: Existence needs . shelter. working conditions. .Existence needs include all needs related to food. pay. clothing. Relatedness needs – Relatedness needs include meaningful social and interpersonal relationships Growth needs – Growth needs involve the individual making efforts to achieve full potential.

Both models deal with movements upward in hierarchy.Principles and Practices of Management ADL 01 Maslow’s Model versus ERG Theory The overall structure of need categories is the same. progression. ERG Theory provides a specific mechanism for downward DIFFERENCES movement in the hierarchy which Alderfer . Hygiene Motivators Company policy and administration Achievement Relationship with supervisor Recognition Work condition Work itself Salary Responsibility Relationship with peers Advancement . status. responsibility. regression can also offer if you fail to satisfy need for certain level. if absent. in addition to satisfaction.g. salary and fringe benefits that do not motivate if present. result in demotivation. job security. but. working conditions. Hygiene factors : EXTRINSIC CONDITIONS e.g. frustration. recognition. challenging work. status. supervision quality. Alderfer‘s SIMILARITIES theory is only a reconfigured need hierarchical model. growth possibilities which give positive satisfaction. Herzberg’s Two-Factor theory Motivators : Intrinsic conditions e.

Principles and Practices of Management ADL 01 Personal life McCllelland’s Need Theory Growth .

Affiliation(naff)-. influence and control people.Principles and Practices of Management ADL 01 – The theory assumes that people‘s behavior in organizations is based on three principal needs: Achievement(nach) . - . for developing meaningful relationships with people.This is the need to dominate. for personal accomplishment and success in competitive situations.This need is a social need. for companionship and support.This is the need for challenge. Power (npow).

According to the assumptions managers can motivate employees. with Job security subordinates Relatedness Need for Affiliation Existence Working conditions. McGREGOR’S THEORY X AND THEORY Y The basic assumptions of Douglas McGregor‘s about employees are described by theory X and Theory Y. among with supervisors.Principles and Practices of Management ADL 01 Maslow - Herzberg Need hierarchy Two-factor theory The work itself – Self actualization High order needs Esteem Need for Achievement Responsibility Need for Power Achievement Safety And McClelland Growth Motivators Belongingness. THEORY “X” – ASSUMPTIONS ABOUT EMPLOYEES BY THEORY X: The average person dislikes work and will avoid it he/she can. Salary. Therefore most people must be forced with the threat of punishment to work towards organisational objectives. Social & Love Basic needs Alderfer Hygiene factors Security Physiological Recognition Advancement Quality of inter personal relations Growthpeers. .

is relatively unambitious. to avoid responsibility. and wants security above all else.Principles and Practices of Management ADL 01 The average person prefers to be directed. compared to the outcomes and inputs of other people (referent others). Management is responsible for organizing the elements of productive enterprise. PROCESS THEORIES – Theories that address how and why people become motivated. THEORY “Y” -– ASSUMPTIONS ABOUT EMPLOYEES BY THEORY Y: Effort in work is as natural as work and play. without external control or the threat of punishment. not narrowly. Commitment to objectives is a function of rewards associated with their achievement. ADAM’S EQUITY THEORY When people measure the fairness of their work outcomes in comparison with others felt inequity is a motivating state of mind. ingenuity and creativity in solving organisational problems is widely. People usually accept and often seek responsibility. People will apply self-control and self-direction in the pursuit of organisational objectives. . Theory states that motivation is affected by the an individual‘s perception of the equity (―fairness‖) of the outcomes (rewards) they receive in return for their inputs (efforts). The capacity to use a high degree of imagination. distributed in the population.

Individuals make contributions (inputs) for which they expect certain outcomes(rewards). Vroom proposes three variables to account for this Valence.  Performance–Reward Relationship – The belief that performing at a particular level will lead to the attainment of a desired outcome.  Rewards–Personal Goals Relationship . Expectancy and Instrumentality. 2. Individuals decide whether or not a particular exchange is satisfactory. by comparing their inputs and outcomes to those of others. Individual beliefs on Work effort------performance---------work related outcomes Managers must know three things Effort–Performance Relationship – The probability that exerting a given amount of effort will lead to performance. The strength of a tendency to act in a certain way depends on the strength of an expectation that the act will be followed by a given outcome and on the attractiveness of that outcome to the individual. VROOM’S EXPECTANCY THEORY When people measure the fairness of their work outcomes in comparison with others felt inequity is a motivating state of mind.Principles and Practices of Management ADL 01 This theory is based on two assumptions about human behaviour: 1.

time)  Having the right skills to do the job  Having the necessary support to get the job done (e. there is something in it for me.g.g. . the rules of the reward ‗game‘  Trust in the people who will take the decisions on who gets what outcome  Transparency of the process that decides who gets what outcome Valence is the importance that the individual places upon the expected outcome. supervisor support. I might not value offers of additional time off.e. For example.Principles and Practices of Management ADL 01 The degree to which organizational rewards satisfy an individual‘s goals or needs and the attractiveness of potential rewards for the individual It can be further explained as Expectancy is the belief that increased effort will lead to increased performance i.g. if I am mainly motivated by money. This is affected by such things as:  Having the right resources available (e. if I do a good job.e. if I work harder then this will be better. raw materials. or correct information on the job) Instrumentality is the belief that if you perform well that a valued outcome will be received i. Expectancy theory works on motivation= expectancy x valence x instrumentality as a multiplier effect. This is affected by such things as:  Clear understanding of the relationship between performance and outcomes – e.

and is used in psychology to refer to anything stimulus which strengthens or increases the probability of a specific response.Principles and Practices of Management ADL 01 REINFORCEMENT THEORY The term reinforce means to strengthen. The dog will eventually come to understand that sitting when told to will result in a treat. The examples above describe what is . This treat is reinforcing because he likes it and will result in him sitting when instructed to do so. For example. if you want your dog to sit on command. Reinforcement is anything that causes a given behaviour to be repeated or inhibited. There are four types of reinforcement are used: Positive reinforcement: It is a method of strengthening behaviour with rewards or positive outcomes after a desired behaviour is performed. you may give him a treat every time he sits for you.

It is based on the principle that if a response is not reinforced. The most common types of positive reinforcement or praise and rewards. and most of us have experienced this as both the giver and receiver. Goal setting Theory . it will eventually disappear. Example: Think of negative reinforcement as taking something negative away in order to increase a response. You are taking something away so that a response is decreased.g. Example: Punishment refers to adding something aversive in order to decrease a behavior. It can take either of two forms: there can be withdrawal or termination of desirable or rewarding consequences to there can be an unpleasant consequence after behaviour is performed. Extinction: Extinction is an effective method of controlling undesirable behaviour. he or she will stop behaving in that manner. this is called extinction. Think of it as adding something in order to increase a response. It also refers to non-reinforcement. The most common example of this is disciplining (e. he finally one day performs the task and to his amazement. The elimination of this negative stimulus is reinforcing and will likely increase the chances that he will take out the garbage next week. Punishment: Punishment is a control device employed in organization to discourage and reduce annoying behaviours of others. the nagging stops.Principles and Practices of Management ADL 01 referred to as positive reinforcement. When you remove something in order to decrease a behavior. After complaining to his friends about the nagging. spanking) a child for misbehaving. The punishment is not liked and therefore to avoid it. Imagine a teenager who is nagged by his mother to take out the garbage week after week. The reason we do this is because the child begins to associate being punished with the negative behavior. Negative reinforcement: It occurs when an unpleasant or undesirable situation is removed or withdrawn following some behaviour.

Self-set 2. Assigned 4. Rewards 4.  People will attempt to achieve those goals that they intend to achieve. link rewards to the effort of the employees. Acceptance 3. Locke. Specificity 2.Principles and Practices of Management ADL 01 This theory was given by W. Difficulty 1.  People must accept goals as their own if they are to work toward achieving them. The Goal Setting Process – In order to motivate employee‘s managers must know individual differences. It states that people will perform better if they have difficult. Do your best Goal Consequences Characteristics 1. Performance 2. Participative 3. Satisfaction 3.  People must commit to goals to achieve them. Commitment .  Specific goals are better than vague goals.  Difficult goals result in better performance than easy goals. specific accepted performance goals or objectives. match jobs. • The Goal Setting Process Personal Values How the world should be Present Situation Am I consistent with my values? Goal Setting 1.

for an explicit time period. with feedback on goal progress. Linking MBO and Goal-Setting Theory MBO Goal-Setting Theory Goal Specificity Yes Yes Goal Difficulty Yes Yes Feedback Yes Yes Participation Yes No (qualified) .Principles and Practices of Management ADL 01 Linking Management by Objectives and goal setting theory It is a program in organizations‘ that encompasses specific goals derived for employees through participative approach.

Critically examine motivation theories.Principles and Practices of Management ADL 01 Review questions 1. 4. Define decision making and its steps. a. The order of direction vocally discuss ………… and matter that had be instructed. 2. 5. Imagination 3. Problem solving d. Programmed d. a. Is MBO a important process for management? Do you agree or disagree? Discuss you answers. creativeness and good judgment on the part of managers. Routine b. Basic decisions are ………… one-time decisions demanding large investments. d. Elaborate the principles of directing. Content Time People None 2. c. What are the barriers in communication? Test your understanding 1. Un –programmed . b. a. Innovation b. ………… is the process by which individuals select a course of action among several alternatives. to produce a desired result. Decision making c. Is there a single way to motivate people? 6. Unique c. 3.

Controlling d. Planning 7. All the above 8. Theories that focus on what factors (needs) motivate people are …………. Motivation c. All the above 6. Semantic is the study of meaning in …………………….. Process d. a.Principles and Practices of Management ADL 01 4. Content b. a.. Alderfer has provided an extension of………………. a. a. d. ………………. Equity theory c. Words d.. Leading b. c. Contemporary c. is a process of stimulating people to action to accomplish desired goals. 1956 1970 1954 1980 5. Language b.. The concept of ‗MBO‘ was first given by Peter Drucker in the year ………. Herzberg theory b.. Maslow‘s need hierarchy . Action c. b. a.

Principles and Practices of Management ADL 01 d. B 4. Need for achievement b. Reward Answer key 1. B 2. The probability that exerting a given amount of effort will lead to performance is………. Vroom‘s theory 9.. Valence c. B 3. Need for existence d. The need to dominate. influence and control people………. A 6. a. Motive d. Need for power c. B 7. A 8. A . None 10. C 9. a. C 5. A 10. Expectancy b.

Principles and Practices of Management ADL 01 Chapter 6 CO-ORDINATION AND CONTROLLING .

Definitions iii. Meaning of control x. unified and blended so as to give them a commonness and purpose. Techniques of co-ordination vi. to ensure a harmonious and smooth working of an organisation with a number of its divisions. Process of Controlling xiv. Types of co-ordination vii.” . synchronisation or orderly pattern of group efforts in the institution towards the accomplishment of common objectives. Kinds of control Introduction Coordination is considered as an essential element of administration. Characteristics of Control xi. Co-ordination is ―the integration. Need for co-ordination v.Principles and Practices of Management ADL 01 Chapter outline i. the activities in all the areas are required to be pulled together. The elements of control xii. department or its units. Relationship between the elements of control and information xiii. Hindrances to co-ordination ix. Principles of co-ordination iv. Importance of co-ordination viii. Introduction-co ordination ii.

and controlling. co-ordination endeavour must sort at the planning stage. Co-ordination is continual activity that permeates through each managerial function. Along with organizing. Principles of co-ordination 1. There is need for importance of direct personal contact in removing misunderstanding and conflict between departments. coordinating is one of the key functions of management. 2. blending and joining together the factors with one another. monitoring.Principles and Practices of Management ADL 01 Definitions "Co-ordination is the orderly synchronisation of efforts to provide the proper amount. The concept of co-ordination is much broader than that of co-operation. and directing execution resulting in harmonious and unified actions to a stated objective" "Co-ordination is the integration of several parts into an orderly whole to achieve the purpose of undertaking" "Co-ordination is the integrating process in an orderly pattern of group efforts in an organisation toward the accomplishment of a common objective" Synchronization and integration of activities. timing. and command and control structures to ensure that the resources are used most efficiently in pursuit of the specified objectives. actions and interests toward a common purpose. As the thinking function of management precedes the doing function. There should be an integration of all efforts. . Co-ordination is only a means to an end and not an end itself. responsibilities. 3. otherwise it becomes impossible to secure co-ordination of activities and efforts in the execution of work. 4. Both these have to go side by side. For this co-ordination call for the establishment of a reciprocal relationship among all pertinent factors by way of balancing.

integrity or initiative on the part of employees. Techniques of co-ordination Communications-Effective communication is arranged not only by building a network of communication systems but by allowing wide participation also in the decision making on the part of the affected persons.Principles and Practices of Management ADL 01 Need for co-ordination Diverse and specialized activities. Hence co-ordination is needed to prevent and discourage too much concentration on one aspect of work. incompetence and ambition as well as lack of loyalty. So co-ordination is needed to curb the growing tendency towards the empire building. Under such situation. Empire building. Every manager tends to concentrate his attention on activities and objectives of has own department.Standing plans like policies and procedures. Personal rivalries and prejudice-Human organisation give rise in course of time to the development of personality politics among members. Orderly plans. thus turning it as a separate entity.Total activities of an organisation are divided into several units and subunits on the basis of either product specialisation.Subordination of individual interest to general interest acts as a bar to co-ordination. There is need for co-ordination to avoid conflicts or overlapping in the work of employees or units or as organisation. coordination is deliberately damaged by the members of the rival group. standing orders and instructions communicate the expected pattern of behaviour required for co-ordinated . This motive causes the individual department to be isolated from others.To exaggerate self importance and personal motive is deeply implanted in human nature. The perceptual conflict between line and staff positions or between personnel is a pointer to this problem Conflict of interests. This subordination may arise from a number of causes by a laziness.

it refers to the blending of all efforts and activities and forces operating within an organisation or enterprise. Because of checking. it aids much in developing co-ordinated efforts. Supervision. To draw up an orderly course of action. and desired for their guidance toward the desired end. To reach ends all plans include a programme mapping out the orderly course of action. Departmentation-Departmentation arranges for necessary correlation and interconnection of activities in an analytical manner by assigning duties and delegating authority in different positions is the work of departmentation. Internal co-ordination Planning. observation and guidance involved and supervision. Direct contact-it permits the management members to exchange their ideas. all activities and efforts are to be interlinked.Principles and Practices of Management ADL 01 action. Types of co-ordination Internal co-ordination. . Leadership-leadership provides individual motivation and persuades the group to have identity of interests and outlook in group efforts.Effective supervision aids in co-ordination much in developing coordinated effort by checking. observation and guidance. prejudices and problems as well as to understand each others. a good plan requires a perfect harmonisation between mean and ends and this in itself is an ct of co-ordination.it is a well thought out course of action to be taken for realising certain objectives through the available means. External co-ordination.the blending of all efforts and activities and forces operating outside the enterprise or organisation which contribute to achieving the goals and objective of the organisation.

Supervisor gives assistance. motivation. Other enterprise – an enterprise affects and is affected in turn by the activities of other enterprises particularly those in the same line of business. Non-availability of materials may lead to forced stoppages of production on the part of some enterprise. advice or direction to obtain cohesive group efforts Control-control ensures the realisation of planned objectives through the process of work evaluation. Direction – direction is concerned with making the human efforts more effective and productive through leadership.congenial working conditions . communication and supervision. employees and the owners whose conflicting needs and demands have to be satisfied by managers of any business. fair returns on the investments and accurate information on several aspects of business.Principles and Practices of Management ADL 01 Organization – organisation is set up with the primary purpose of securing coordination particularly interdepartmental and interpersonal. efficient and continuous operation of business. . quality. Employees-demand fair wages . External co-ordination There are 3 interesting parties-the customers.steady employment satisfaction from the work as well as protection against hazards of accidents and sickness or old age Owners –want conservation of assets. guidance. Many enterprises are chained together by their customer –buyer relationships. Consumers desire an uninterrupted supply of quality goods and services at fair process and expect a steady improvement in the quality of goods and services so as to give them a higher standard of living. time use and cost. Managers directing the efforts of employees towards a common goal. Supervision is a cementing force for securing better performance from workers. The work progress is analysed and appraised in terms of quantity. An enterprise purchase materials and services from other enterprises. failing or delaying. Departments and divisions are established to ensure a smooth flow of work without friction.

co-ordination ensures unity if direction by way of securing spontaneous collaboration on the part of different departments. Without introducing new technological changes an enterprise cannot go ahead. Technology advances-an enterprise must secure the benefit of new technology which is being made continually available in our society through research and interventions .Principles and Practices of Management ADL 01 Government regulations-the government at city. Hindrances to co-ordination 1. Creative force.group efforts when co-ordinated create a result greater than the sum total of the individual and isolated.technological advances contribute significantly towards the reduction of cost and the improvement of productivity. 4. . labour etc is necessary General business economy-enterprises must adjust themselves with the swings of the trade cycle through economic forecasting and trend study. This composite effort is brought about by executive action on human relation and leadership. Compliance with various laws relating to tax.co-ordination tones up the general level of employee morale and provides satisfaction. 3. Unity of direction. 2. The uncertainty of the future. tariff. Quintessence of management: in a sense. forces and activities that affect the enterprise from within and without it. Regulatory measures of government become so extensive that no enterprise can stay in business without becoming thoroughly familiar with the socioeconomic trends which produce these restrictive regulations. management is primarily a task of coordination of all efforts. High employee morale. as to the behaviour of the individual and the people. Importance of co-ordination 1. state or central level exerts potent forces that are to be recognised by all managers.

7. wisdom and character among leaders and their confused and conflicting ideas and objectives. personality and political factors. The vast number of variables involved and the incompleteness of human knowledge. The lack of administration skill and technique. What is Control? Control is an important function because it helps to check the errors and to take the corrective action so that deviation from standards are minimized and stated goals of the organization are achieve in desired manner. particularly with regard to men and life. The lack of knowledge. and the principles which have been laid down. Its object is to point out mistakes in order that they may be rectified and prevented from recurring. Thus. the orders which have been given. measuring actual performance and taking corrective action. 6. Lack of leaders with wisdom and knowledge pertaining to public administration 8. According to modern concepts. Control in management means setting standards. Size and complexity. experience. According to Henri Fayol. The accelerated expansion of public administration of international dimension. Control is defined by various authors. Control of an undertaking consists of seeing that everything is being carried out in accordance with the plan which has been adopted.Principles and Practices of Management ADL 01 2. 4. 5. control is a foreseeing action whereas earlier concept of control was used only when errors were detected. 3. control comprises these three main activities. . The lack of orderly methods of developing new ideas and programmes.

Management is the profession of control.Principles and Practices of Management ADL 01 According to EFL Breach. Therefore control is the process of monitoring activities to ensure that they are being accomplished as planned and of correcting any significant deviations. Characteristics of Control Control is a continuous process Control is a management process Control is embedded in each level of organizational hierarchy Control is forward looking Control is closely linked with planning Control is a tool for achieving organizational activities What are the steps involved in management control process? . Control is checking current performance against pre-determined standards contained in the plans. Controlling is the measurement and correction of performance in order to make sure that enterprise objectives and the plans devised to attain them are accomplished. According to Stafford Beer. According to Harold Koontz. with a view to ensure adequate progress and satisfactory performance.

A standard acts as reference line or a basis of appraisal of actual performance. Standards should be set precisely and preferable in quantitative terms. The exhibit explains the steps – Measuring the actual performance Comparing actual versus standards Taking managerial action against deviations Establishment of Standards . Setting standard is closely linked and is and integral part of the planning process. Standards are used or bench marks by .is the first step in control process. These are the goals created during the planning process against performance progress measured. Standards represent criteria for performance.Principles and Practices of Management ADL 01 The control process assumes that performance standards exist.

where results are intangible and cannot be measured quantitatively direct personal observations. In other cases. inspection and reports are few methods which can be used for evaluation. Manager to measure the actual performance can collect information from personal observation. statistical reports. planning is the basis of control.Appraisal of performance or comparing of actual performance with pre-determined standards is an important step in control process. oral reports and written reports. To determine the actual performance a manager must acquire information about how we measure and what we measure. The evaluation will reveal some deviations from the set standards.Principles and Practices of Management ADL 01 which performance is measured in the control operations at the planning stage. The evaluator should point out defect or deficiencies in performance and investigate the causes responsible for these. the second step is to measure actual performance of various individuals. groups or units. Measurement of Performance .After establishing the standards. Management should not depend upon the guess that standards are being met measurement of performance against standards should ideally be done on a forward looking basis so that deviations may be detected in advance of their occurrence and avoided by appropriate actions. The selection of a wrong criteria can result in serious dysfunctional consequences. Comparison is easy where standards have been set in quantitative terms as in production and marketing. What we measure is more important than how we measure. Comparing Performance with Standards . .

TOOLS FOR CONTROLLING ORGANIZATIONAL PERFORMANCE Depending on the time at which the control is applied. the corrective action must be applied. Feedback Control enables managers to use information on past performance. Concurrent Control techniques immediately consider any problem and analyze it to take necessary .Principles and Practices of Management ADL 01 Taking Corrective Actions . INPUT PROCESSES FEED FORWARD CONTROL CONCURRENT CONTROL (Anticipates problems) (Corrects problems as they happen) OUTPUT FEEDBACK CONTROL (Corrects problems after they occur) 1. They may correct. evaluating that information and taking steps to improve similar activities in the future. by additional stapling or better selection and training of subordinates. 2. Or they may correct deviations by exercising their organizing functions through reassignment or clarification of duties. Controls are of three types. bring future performance into line with the planned objectives. Managers may correct deviations by redrawing their plans or by modifying their goals. Feedback Control (Historical or post-control) – It is a process of gathering information about the completed activity. Concurrent Control – It is also called ‗real-time‘ control.Managers should know exactly where in the assignment of individual or group duties. also.

Weber's view tends to include all levels or types of organizational control as being the same. frustration and resentment of the control process can result. Unachievable standards. in advance of their occurrence. this will not contribute to doing the right thing efficiently.It anticipates problems that the management encounters in future. 3. writers have tended to differentiate . It is also known by another name ‗steering control‘ and occurs while an activity is taking place. RESISTANCE TO CONTROL – There is natural resistance to controls because controls take away because controls take away a certain amount of individual freedom Over-Control – When organizations try to control too many things. "closeness of supervision". and "hierarchical authority".Principles and Practices of Management ADL 01 and corrective steps before any major damage is done. employees perceive these as unreasonable and unacceptable and then trouble begins to surface. Associated with this theory are such concepts as "span of control". More recently.Unattainable standards produce negative reactions from employees and thus this may lead to the employees quitting the company in frustration. Predictive Control attempts to anticipate problems or deviations from the standard. Inappropriate Controls – Often Controls are not related to the objectives of the organization. If the wrong thing is being controlled. Unpredictable standards – When the control system is unpredictable and constantly changed. Predictive or Feedforward Control. Organizational and Operational Control The concept of organizational control is implicit in the bureaucratic theory of Max Weber.

budgets etc. it is logical to check first to see if the problem is due to such readily obtainable . a failure to meet expectations may signal the need to reorganize or redesign. and energy. The direction for organizational control comes from the goals and strategic plans of the organization. In both instances. For example. but organizational control tends to review and evaluate the nature and arrangement of components in the system. To illustrate the difference. The process of organizational control is to review and evaluate the performance of the system against these established norms.Principles and Practices of Management ADL 01 the control process between that which emphasizes the nature of the organizational or systems design and that which deals with daily operations. Rewards for meeting or exceeding standards may range from special recognition to salary increases or promotions. the elements of feedback are present. whereas operational control tends to adjust the daily inputs. we operate and "control" the system with respect to the daily inputs of material. if an organization's output backlog builds rapidly. In organizational control. is it because the system is not effective (accomplishing its objectives)? Is the system failing to achieve an expected standard of efficiency? Is the evaluation being conducted because of a breakdown or failure in operations? Is it merely a periodic audit-and-review process? When a system has failed or is in great difficulty.. the approach used in the program of review and evaluation depends on the reason for the evaluation — that is. General plans are translated into specific performance measures such as share of the market. information. On the other hand. special diagnostic techniques may be required to isolate the trouble areas and to identify the causes of the difficulty. It is appropriate to investigate areas that have been troublesome before or areas where some measure of performance can be quickly identified. In contrast. we "evaluate" the performance of a system to see how effective and efficient the design proved to be or to discover why it failed.

When a more detailed analysis is necessary. Controlling output also suggests the difficulty of controlling individuals' performance and relating this to the total system's objectives . comparing performance to some standard. and finished products being purchased and produced in the desired quantities? Are the costs associated with the transformation process in line with cost estimates? Is the information needed in the transformation process available in the right form and at the right time? Is the energy resource being utilized efficiently? The most difficult task of management concerns monitoring the behavior of individuals. The larger the unit. In contrast to organizational control. it is better to measure the performance of the entire group. and costs. operational control serves to regulate the day-to-day output relative to schedules. a manager might not be concerned with the behavior of a salesman as long as sales were as high as expected. a systematic procedure should be followed. and providing rewards or punishment as indicated. specifications. For example. This means that individuals' levels of motivation and the measurement of their performance become subjective judgments made by the supervisor.Principles and Practices of Management ADL 01 measures as increased demand or to a drop in available man hours. Is the output of product or service the proper quality and is it available as scheduled? Are inventories of raw materials. Sometimes this control over people relates entirely to their output. close supervision of the salesman might be appropriate if achieving customer satisfaction were one of the sales organization's main objectives. goods-inprocess. In other instances. It also follows that if it is difficult or impossible to identify the actual output of individuals. the more likely that the control characteristic will be related to some output goal.

Principles and Practices of Management ADL
01
Review questions
1. Contrast between feedback control and concurrent control.
2. Explain the steps in control process.
3. Why is control important for organization? How is related to planning process?
4. Briefly explain the types of managerial control?
5. Management involves co-ordination and integration of all resources to
accomplish specific results. Explain?
6. Outline the principles and techniques of co-ordination?
7. Explain features of co-ordination?

Test your understanding
1. ..........................refers to the blending of all efforts and activities and forces operating
within an organisation or enterprise.
a. External coordination
b. Internal co-ordination
c. Both
d. None
2. Control in management means setting standards, measuring …………..and taking
corrective action.
a. Actual performance
b. Projected performance
c. Past performance
d. None
3. Control is a …………… process.

Principles and Practices of Management ADL
01
a. Separate
b. Distinct
c. Continuous
d. None
4. There are ………………basic elements in a control system.
a. One
b. Four
c. Two
d. Three
5. …………….. Is also called ‗real-time‘ control
a. Feedback
b. Concurrent
c. Feed forward
d. All
6. Co-ordination is the integrating process in an orderly pattern of group efforts in an
organisation toward the accomplishment of ................
a. Common objective
b. Primary objective
c. Shared objective
d. All
7. ……………………. is a process of gathering information about the completed activity.
a. Feedback control
b. Concurrent control
c. Real time control
d. None

Principles and Practices of Management ADL
01
8. Technique of coordination is…………….
a. Communication
b. Planning
c. Chain of command
d. Leading
9. Predictive control is also called the………..
a. Feedforward control
b. Concurrent control
c. Real time control
d. None
10. Coordination between different level of organization is……….
a. External coordination
b. Customer coordination
c. Internal coordination
d. All

Answer key

1. B
2. A
3. C
4. B
5. B
6. A
7. A
8. A
9. A
10.A

Venu. Prentice-Hall of India. New Delhi. Management . Udai: Understanding Organizational Behavior. Corporate Planning. Kogan Page 10th edition. Rue. Lesile W. Illinois. VSP & Krishna. Koontz and O‘Donnell. VH: Management –Text & Cases. Schermerhorn. J. Richard D. . Excel Books. Second Edition.. Calcutta. Byers. Michael: Human Resource Management Practice. Management.Management : Fundamentals.A. New Delhi. Virginia.2004. Gary Desseler . Essentials of Management. Lloyd L. New Delhi. Armstrong. Pareek. Tata McGrawHill .Principles and Practices of Management ADL 01 References Rao. Prentice-Hall . Griffin.Stoner . Orient Longman. Hunt & Osborn: Managing Organizational Behavior. Irwin Inc. 2002.W. Management. John Billy and sons. AITBS. R. . Oxford University Press. S.

youtube.com/watch?v=_cC2lnfGzLs : Planning for a Non-Profit Organization http://www.com/watch?v=RNjYsYMQ3pI&p=B2187BF27EE3198C&index=1 Planning http://www.youtube.youtube.com/watch?v=7pPlGR6OOmI : Backwords Planning http://www.com/ www.html http://ezinearticles.com/watch?v=2PmTP8hMGIc: Achieving Goals Using Think-PlanDo http://www.youtube.com/watch?v=NCDlozomQiY : How to Write a Values Statement http://www.youtube.buzzle.valuebasedmanagement.youtube.youtube.com/watch?v=XDP26gGFVJIOrganization and Planning Skills http://www.com/watch?v=ikRWdZOxjZs&p=B2187BF27EE3198C&playnext= 1&index=1 Overview of strategic planning http://www.htm http://www.com/articles/management-concepts-the-four-functions-ofmanagement.net/ www.com/watch?v=w9OlaH_etBI : Strategy .An Organizational Vision Quest http://www.com/management_functions.managementstudyguide.managementmag.youtube.youtube.com/?Functions-Of-Management&id=1200015 Websites for video references http://www.com/watch?v=qpITGIcF520 : Be A Successful Negotiator .Principles and Practices of Management ADL 01 Web sites to refer www.youtube.com/watch?v=sP7Q51zHp4I : Management: Planning & Forecasting http://www.com/watch?v=vqByFsaIvjY&p=B2187BF27EE3198C&index=3 : Planning http://www.youtube.