2. Explain the various functions of the management.

Management:
The organization and coordination of the activities of a business in order to achieve
defined objectives. Management is often included as a factor of production along with
machines, materials, and money. According to the management guru Peter Drucker
(1909-2005), the basic task of management includes both marketing and innovation.
Practice of modern management originates from the 16th century study of low-efficiency
and failures of certain enterprises, conducted by the English statesman Sir Thomas More
(1478-1535). Management consists of the interlocking functions of creating corporate
policy and organizing, planning, controlling, and directing an organization's resources in
order to achieve the objectives of that policy.

Functions of the management:

Management has been described as a social process involving responsibility for
economical and effective planning & regulation of operation of an enterprise in the
fulfillment of given purposes. It is a dynamic process consisting of various elements and
activities. These activities are different from operative functions like marketing, finance,
purchase etc. Rather these activities are common to each and every manger irrespective
of his level or status.
Planning:
It is the basic function of management. It deals with chalking out a future course of action
& deciding in advance the most appropriate course of actions for achievement of pre-
determined goals. According to KOONTZ, “Planning is deciding in advance - what to do,
when to do & how to do. It bridges the gap from where we are & where we want to be”.
A plan is a future course of actions. It is an exercise in problem solving & decision
making. Planning is determination of courses of action to achieve desired goals. Thus,
planning is a systematic thinking about ways & means for accomplishment of pre-
determined goals. Planning is necessary to ensure proper utilization of human & non-
human resources. It is all pervasive, it is an intellectual activity and it also helps in
avoiding confusion, uncertainties, risks, wastages.

Organizing:
It is the process of bringing together physical, financial and human resources and
developing productive relationship amongst them for achievement of organizational
goals. According to Henry Fayol, “To organize a business is to provide it with everything
useful or its functioning i.e. raw material, tools, capital and personnel’s”. To organize a
business involves determining & providing human and non-human resources to the
organizational structure. Organizing as a process involves
• Identification of activities.
• Classification of grouping of activities.
• Assignment of duties.
• Delegation of authority and creation of responsibility.
• Coordinating authority and responsibility relationships.

Staffing:

It is the function of manning the organization structure and keeping it manned. Staffing
has assumed greater importance in the recent years due to advancement of technology,
increase in size of business, complexity of human behavior etc. The main purpose o
staffing is to put right man on right job i.e. square pegs in square holes and round pegs in
round holes. According to Kootz & O’Donell, “Managerial function of staffing involves
manning the organization structure through proper and effective selection, appraisal &
development of personnel to fill the roles designed un the structure”. Staffing involves
• Manpower Planning (estimating man power in terms of searching, choose the
person and giving the right place).
• Recruitment, Selection & Placement.
• Training & Development.
• Remuneration.
• Performance Appraisal.
 • Promotions & Transfer.

Directing:

It is that part of managerial function which actuates the organizational methods to work
efficiently for achievement of organizational purposes. It is considered life-spark of the
enterprise which sets it in motion the action of people because planning, organizing and
staffing are the mere preparations for doing the work. Direction is that inert-personnel
aspect of management which deals directly with influencing, guiding, supervising,
motivating sub-ordinate for the achievement of organizational goals. Direction has
following elements:
• Supervision
• Motivation
• Leadership
• Communication

Supervision- implies overseeing the work of subordinates by their superiors. It is the act
of watching & directing work & workers.
Motivation- means inspiring, stimulating or encouraging the sub-ordinates with zeal to
work. Positive, negative, monetary, non-monetary incentives may be used for this
purpose.
Leadership- may be defined as a process by which manager guides and influences the
work of subordinates in desired direction.
Communications- is the process of passing information, experience, opinion etc from one
person to another. It is a bridge of understanding.

Controlling:

It implies measurement of accomplishment against the standards and correction of

deviation if any to ensure achievement of organizational goals. The purpose of
controlling is to ensure that everything occurs in conformities with the standards. An
efficient system of control helps to predict deviations before they actually occur.
According to Theo Haimann, “Controlling is the process of checking whether or not
proper progress is being made towards the objectives and goals and acting if necessary, to
correct any deviation”. According to Koontz & O’Donell “Controlling is the
measurement & correction of performance activities of subordinates in order to make
sure that the enterprise objectives and plans desired to obtain them as being
accomplished”.
Therefore controlling has following steps:

• Establishment of standard performance.

• Measurement of actual performance.

 • Comparison of actual performance with the standards and finding out deviation if
any.

4. What is Organizational Dynamics? Explain.

Organizational dynamics
Organizational dynamics refers to the patterns of movement over time in the
interactions between the people who are the organization, the community of practice .
Such patters could be described, for example, as regular patterns of dependence and
conformity, or as irregular patterns of aggression and noncompliance.

Organizational dynamics is defined as the process of continuously strengthening

resources and enhancing employee performances. It can also be described as how an
organization manages and promotes organizational learning, better business practices
and strategic management.

The Essential Elements

There are four fundamental business activities that contribute to an organization’s
dynamics.

• First, planning requires management to structurally define departments and

divisions. Managers set measurable goals that will define future actions and
decisions. Organizational planning may involve inventory control, production
scheduling, revenue forecasts and expense management. Managers use these
plans as the actionable foundation for all their regular duties.

• Second, goal execution involves implementing, evaluating and following up with

expected deliverables. In order to accomplish this, managers must allocate
resources and responsibilities to employees based on skills and schedules.

• Third, leadership involves hands-on, exemplary oversight that drives innovation,

knowledge and performance.

• Fourth, resource control refers to how executives and management establish

systems that gather data which is used to determine if goals are met.

Business Function Specializations

 Every company will have managers who are responsible to monitor and control
certain business functions. At the heart of an organization’s dynamics lies human
resources management, which is concerned about optimizing employee performances.

HR managers are trained to improve individual and organizational effectiveness

through applying relevant behavioral sciences and HR management principles.
Project managers drastically impact a company’s dynamics and overall performance.
Successful project managers will ensure quality through careful planning that addresses
risk, communications and progress management. They also create open forums that
empower vendors, employees and shareholders to share information. Project managers
directly impact the financial health through financial monitoring and integrated cost
controls.

An Industry Case Study

Within the procurement industry and supply chain organizations, employee and
communication dynamics must be continually streamlined in order to avoid problems and
increase program effectiveness.

Procurement managers seek to create united cultures that share logistical goals
and technology objectives.
Every day, supply chain managers must engage in efficient source selection, inventory
management and vendor monitoring.

Alternatively, transportation managers must clearly understand regulatory

requirements and shipper limitations in order to maintain adequate resources and product
volumes.

Every more challenging, international supply chain managers must successfully

deal with cross-cultural and supplier issues within the global logistics environment. For
instance, they may be required to manage the organizational dynamics of global
hazardous materials shipments.

5. Discuss the classical principles of good Management.

Henri Fayol was born in Istanbul in 1841. When he was 19, he began working as an
engineer at a large mining company in France. He eventually became the director, at a
time when the mining company employed more than 1,000 people.

Through the years, Fayol began to develop what he considered to be the 14 most
important principles of management. Essentially, these explained how managers should
organize and interact with staff.

In 1916, two years before he stepped down as director, he published his "14
Principles of Management" in the book "Administration Industrielle et Générale." Fayol
also created a list of the six primary functions of management, which go hand in hand
with the Principles.

Fayol's "14 Principles" was one of the earliest theories of management to be created,
and remains one of the most comprehensive. He's considered to be among the most
influential contributors to the modern concept of management, even though people don't
refer to "The 14 Principles" often today.

The theory falls under the Administrative Management school of thought

Fayol's 14 Principles of Management

Fayol's principles are listed below:

Division of Work:

When employees are specialized, output can increase because they become increasingly
skilled and efficient.

Authority:

Managers must have the authority to give orders, but they must also keep in mind
that with authority comes responsibility.

Discipline:

Discipline must be upheld in organizations, but methods for doing so can vary.

Unity of Command:

Employees should have only one direct supervisor.

Unity of Direction:

Teams with the same objective should be working under the direction of one manager,
using one plan. This will ensure that action is properly coordinated.

Subordination of Individual Interests to the General Interest

The interests of one employee should not be allowed to become more important than
those of the group. This includes managers.

Remuneration:

Employee satisfaction depends on fair remuneration for everyone. This includes financial
and non-financial compensation.
 Centralization:

This principle refers to how close employees are to the decision-making process. It is
important to aim for an appropriate balance.

Scalar Chain:

Employees should be aware of where they stand in the organization's hierarchy, or chain
of command.

Order

The workplace facilities must be clean, tidy and safe for employees. Everything should
have its place.

Equity

Managers should be fair to staff at all times, both maintaining discipline as necessary and
acting with kindness where appropriate.

Stability of Tenure of Personnel

Managers should strive to minimize employee turnover. Personnel planning should be a

priority.

Initiative

Employees should be given the necessary level of freedom to create and carry out plans.

Esprit de Corps

Organizations should strive to promote team spirit and unity.

6. What is grouping explain its significance.

Groups are a characteristic of all social situations and almost everyone in an
organization will be a member of one or more groups. The working of groups and the
influence they exert over their membership is an essential feature of human behavior and
of organizational performance. The manager must use groups in order to achieve a high
standard of work and improve organizational effectiveness.

There are many possible ways of defining what a group means. The essential feature of a
group is that its members regard themselves as belonging to the group. A group consists
of a number of people who have:

• A common objective or task

• An awareness of group identity and ‘boundary’
• A minimum set of agreed values and norms which regulates their relatively exclusive
mutual interaction.

Another useful definition defines the group in psychological terms as: any number of
people who
1) Interact with one another
2) Are psychologically aware of one another
3) Perceive themselves to be a group.

Essential feature of work Organisation

Group are an essential feature of the work pattern of any Organisation. Members
of a group must co-operate in order for work to be carried out, and managers themselves
will work within these groups. People in groups influence each other in many ways and
groups may develop their own hierarchies and leaders. Group pressures can have a major
influence over the behaviour of individual members and their work performance. The
activities of the group are associated with the process of leadership. The style of
leadership adopted by the manager has an important influence on the behaviour of
members of the group.

The classical approach to organisation and management tended to ignore the importance
of group and the social factors at work. The ideas of people such as F.W. Taylor
popularized the concept of the rabble hypothesis and the assumption that people carried
out their work, and could be motivated, as solitary individuals unaffected by others.

The human relations approach, however, gave recognition to the work organisation as a
social organisation and to the importance of the group, and group value and norms, in
influencing behaviour are work. The power of group membership over individual
behaviour and work performance was illustrated clearly in the famous Hawthorne
experiments at the ‘Western Electric Company in America’.

Group value and norms

One experiment involved the observation of as group of 14 men working in the bank
wiring room. It may be remembered that the men formed their own sub-groups or cliques,
with natural leasers emerging with the consent of the members. Despite a financial
incentive schemes where workers could receive more money for the more work they did,
the group decided on 6000 units a day as a fair level of output. This was well below the
level they were capable of producing. Group pressures on individual workers were
stronger than financial incentives offered by management.

The group developed its own pattern of informal social relations and codes and practices
(‘norms’) of what constituted proper group behaviour.

• Not to be a ‘rate buster’ – not to produce at too high a rate of output compared with
other members or to exceed the production restriction of the group.

• Not to be a ‘chiseller’ – not to shirk production or to produce at too low rate of output
compared with other members of the group.

• Not to be a ‘squealer’ – not to say anything to the supervisor or management which

might be harmful to other members of the group.

• Not be ‘officious’ – people with authority over members of the group, for example
inspectors, should not take advantage of their seniority or maintain a social distance from
the group.

The group had their own system of sanctions including sarcasm, damaging completed
work, hiding tools, playing tricks on the inspectors, and ostracizing those members who
did not conform with the group norms. Threats of physical violence were also made, and
the group developed a system of punishing offenders by ‘binging’ which involved
striking someone a fairly hard blow on the upper part of the arm. This process of binging
also become a recognised method of controlling conflict within the group.

Another finding of the bank wiring room experiment was that the group did not follow
company policy on the reporting of production figures. It was company policy that each
man’s output should be reported daily by the supervisor. However, the workers preferred
to do their own reporting, and in order to remain in favour with the group the supervisor
acquiesced to this procedure. On some days the men would actually produce more than
they reported to ‘build up’ extra units for those days when they produced less than
reported. Although actual production varied the group reported a relatively standard
amount of output contrary to management instructions.

Socio – technical system

The system approach to organisation and management also gave recognition to the
importance of groups in influencing behaviour at work. The concept of the organisation
as socio – technical system is concerned with the interactions between the psychological
and social factors, as well as structural and technical requirements. Again, it may be
remembered that technological change in the coal-mining industry had brought about
changes in the social grouping of the miners.

New methods of working disrupted the integration of small self-selecting groups of

miners who worked together as independent teams. The change had undesirable social
effects and as a result the new method did not prove as economically beneficial as it
should have done with the new technology. The result was a ‘composite’ method of
working with more responsibility taken by the team as a whole. The composite method
proved to be not only more rewarding socially to the miners but also more efficient
economically than the pervious new method of working.

Formal groups

Formal groups are created to achieve specific organisational objectives and are concerned
with the co-ordination of work activities.

People are brought together on the basis of defined roles within the structure of the
organisation. The nature of the tasks to be undertaken is a predominant feature of the
formal groups. Goals are identified by management, and certain rules, relationships and
norms of behaviour established.

Formal groups tend to be relatively permanent although there may be changes in actual
membership. However, temporary formal groups may also be created by management for
example, the use of project teams in a matrix organisation.

Formal work groups can be differentiated into team groups task groups and technological
groups.
• Team groups – these are fairly autonomous groups with broad terms of reference and
limited supervisions. The team designate the positions to be filled and the allocation of
members, and instigate changes as necessary.
• Task groups – jobs are defined clearly and individuals assigned to specific positions.
The groups has some flexibility over methods of work and the pace of work, but
otherwise limited discretion. Examples could include many administrative or clerical
workers.

• Technological groups – members have very limited autonomy to determiner change the
operational activities. The pace of work is also likely to be controlled. Content and
method of work are specified and individuals assigned to specific jobs. There is little
scope for individual discretion, and often limited opportunities for interaction among
members. A typical example is people working on assembly line operations.

Informal Groups
Within the formal structure of the organisation there will always be an informal structure.
The formal structure of the organisation and system of role relationship, rule and
procedures, will be augmented by interpretation and development at the informal level.
Informal groups are based more on personal relationships and agreement of groups
members than on defined role relationships. They serve to satisfy psychological and
social needs not related necessarily to the tasks to be undertaken. Groups may devise
ways of attempting to satisfy members affiliations and other social motivations which are
lacing in the work situation, especially in industrial organisations.
The membership of informal groups can cut across the formal structure. They may
comprise individuals form different parts of the organisations and/or from different levels
of the organisation both vertically and diagonally as well as same horizontal level. An
informal group could also be the same as the formal group, or it might comprise part only
of the formal group.

The member of informal group may appoint their own leader who exercises authority by
the consent of the members themselves. The informal leader may be chosen as the person
who reflects the attitudes and values of the members helps to resolve conflict leads the
groups in satisfying its goals or liaises with management or other people outside the
groups. The informal leader may often change according to the particular situation facing
the groups. Although not usually the case, it is possible for the informal leader to be the
same person as the formal leader appointed officially by management.

Groups, there fore, help shape the work pattern of organisations and the attitudes and
behaviour of members of their jobs. The formation and operation of work groups, and the
behaviour of their members has an important significance for the manager. Likert, for
example, has developed a theory of organisation based on work groups. In his discussion
of group processes and organisational performance he concludes that: ‘Group forces are
important not only in influencing the behaviour of individual work groups with regard to
productivity, waste, absence and the like, they also affect the behaviour of entire
organisations.’

Overlapping group membership

Likert suggests that organisations function best when members act not as individuals but
as members of highly effective work groups. He proposes a structure based on
overlapping group membership with a ‘Linking-pin’ process by which the superior of one
group is a subordinate member of the next group. The superior is therefore the linking-
pin between a group of subordinates and the next authority level group.

A structure of vertical overlapping groups helps to develop a committed team approach

and would improve the flow the communication, co-ordination and decision-making.

Horizontal linking-pin
Likert also recognises the position of subordinates serving as horizontal linking-pins
between different groups, such as functional or line work groups and product based work
groups.

Likert recognises that sooner or latter the subordinate is likely to be caught in a conflict
between membership of both groups and the provision of information for decision
making. He suggests that both groups would need to be involved in group decision-
making to resolve differences and that this is more likely to occur with system for
management.
Organisation structure
Groups are formed as a consequence of the pattern of organisation structure and
arrangements for the division of work, for example the grouping together of common
activities into sections. Groups may result form the nature of technology employed and
the way in which work is carried out, for example, the bringing together of a number of
people to carry out a sequence of operations on an assembly line. Groups may also
develop when a number of people of the same level or status within the organisation see
themselves as a group, for exp, departmental heads of an industrial organisation, or chief
officers of a local authority.

Groups are deliberately planned and created by management as part of the formal
organisation structure. But groups will also arise form social processes and the informal
organisation. The informal organisation arises form the interaction of people working
within the organisation and the development of groups with their own relationships and
norms of behaviours, irrespective of those defined within the formal structure. This leads
to a major distinction between groups – formal and informal.

REASONS FOR FORMATION OF GROUPS

Individuals will form into groups, both formal and informal, for number of different
reasons relating to both work performance and social processes.

• Certain tasks can be performed only through the combined efforts of number of
individuals working together. The variety of experience and expertise among members of
the group provide a synergetic effect which can be applied to the increasingly complex
problems of modern organisations.

• Groups may encourage collusion between members in order to modify formal working
arrangements more to their liking, for example by sharing or rotating unpopular tasks.
Group membership therefore, provides the individual with opportunities for initiative and
creativity.

• Groups provide companionship and a source of mutual understanding and support form
colleagues. This can help in solving work problems, and also to mitigate against stressful
or demanding working conditions.

• Membership of the group provides the individual with a sense of belonging. The groups
provides a feeling of identity and the chance to acquire role recognition and status within
the group.

• The group provides guidelines on generally acceptable behaviour. It helps to clarify

ambiguous situations such as for example, the extent to which official rules and
regulations are expected to be adhered to in practice, the rules of the game, and what is
seen as the correct actual behaviour. the informal organisation may put pressure on group
members to resist demands from management on such matters as, for example, higher
output or changes in working methods. Groups allegiance can serve as a means of control
over individual behaviour. The group may discipline individuals who contravene the
norms of the group; for example, the process of ‘binging’ in the bank wiring room,
mentioned above.

• The group may provide protection for its membership. Group members collaborate to
protect their interests from outside pressures or threats.