Perspective management (compiled by Dr.

Sunil Kulkarni)

1)Management: science, Theory and Practice

Management is the process of designing and maintaining an environment for efficiently accomplishing
selected aims. Managers carry out the functions of planning, organizing, staffing, leading and controlling.
Managing is an essential activity at all levels of the organization; however, the managerial skills required
vary with the organizational level. The goal of all managers is to create a surplus. Enterprise must take
advantage of the 21st century trends in information technology, globalization and entrepreneurship.
They must also focus on productivity, that is, to achieve a favorable output-input ratio with a specific
time period with due consideration for quality. Productivity implies effectiveness (achieving of
objectives) and efficiency (using the least amount of resources). Managing as a practice is an art;
organized knowledge about management is a science.

Many writers and practitioners have contributed to the development of management thought. Many
theories about management have been proposed and each contributes something to our knowledge of
what managers do. Each theory has some characteristics and contributions as well as the limitations.

The management process (operational)approach draws from other theories of management and
integrates them into a total system of managing.

The organization is a open system that operates within and interacts with the environment. The systems
approach to management includes from the external environment and from claimants, the
transformation process, the communication system, external factors, outputs and a way to re-energize
the system. The transformation process consists of the managerial functions which also provide the
framework for organizing knowledge.

2) Management and society-The external environment, social responsibility and ethics

Managers operate in a complex environment. They are affected by-and to some extent influence-the
environment. Managers operate in a pluralistic society in which many organized groups represent
various interests.

In their decision making, managers must consider the external environment. Technology provides many
benefits but also creates some problems. Increasingly, firms are considering the impact of managerial
actions on the ecological environment. Many business corporations and other organizations are making
serious efforts to establish an environment that is beneficial to individuals, business and society

Corporate social responsibility requires that organizations consider seriously the impact of their actions
on society. similarly, social responsiveness is relating corporate operations and policies to the social
environment in ways that are beneficial to both the company and society. Determining the appropriate
relationships between various types of organizations and society is not an easy task, and one can make
arguments for and against business environment in social activities.

However, there is now a general recognition that the responsibility of business goes beyond profit
maximization
Ethics deals with what is good and bad as well as with moral duty and obligation. Some authors have
suggested that business institutionalize ethics and develop a code of ethics. There are also other factors
that raise ethical standards, including whistle-blowing. Managers have to make difficult choices when
the standards differ in other societies. Trust is the foundation for human relations and modern
management approaches.

3) Global, Comparative and quality management-

International businesses, which extend their operations across national boundaries, are particularly
affected by the educational, socio-cultural-ethical, political-legal and economic environments of the host
countries. Multinational corporations have developed different orientations for operating in foreign
countries, ranging from ethnocentric (the foreign operation’s views are based on those of the parent
company) to Geocentric (the organization is viewed as an interdependent system operating in many
countries, that is, it is truly international)

Countries are forming regional alliances, such as the European Union, NAFTA, ASEAN and Mercosur.
Hofstede studied the impact of a country’s culture on the behavior of its people.

Managerial practices differ between countries. In France, for example government planning greatly
influences the planning and direction of enterprises. In Germany, the use of authority and the concept
of code determination shape managerial practices. South Korea has developed managerial practices that
are different from those in Japan and the United states. Japanese managerial practices differ greatly
from those in the US. Theory Z which involves selected Japanese managerial practices has been adopted
by some US companies.

International business managers also need to understand the economic situations of other countries.
Porter identified four sets of factors that contribute to the competitive advantage of a nation

Quality is a strategic weapon in the global marketplace. The traditional contributors to quality
management are Deming, Juran and Crosby. The Malcolm Baldrige National Quality award recognizes US
organizations for their excellent performance. The European quest for quality is exemplified by ISO 9000
and the European Quality wared.

4) Essentials of planning and Managing by Objectives-

Planning involves selecting the missions and objectives as well as the actions to achieve them.it requires
decision making, which means choosing a future course of action from among alternatives. Planning and
Controlling are closely interrelated. There are many types of plans such as missions or purposes,
objectives or goals, strategies, policies, procedures, rules, programs and budgets. Once an opportunity is
recognized, a manager plans rationally by establishing objectives, making assumptions(premises) about
the present and future environment, finding and evaluating alternative courses of action, and choosing a
course to follow. Next, the manager must make supporting plans and devise a budget. These activities
must be carried out with attention to the total environment. Short-range plans must, of course, be
coordinated with long-range plans.

Objectives are the end points toward which activities are aimed. Objectives are verifiable, if it is possible
at the end of the period to determine whether they have been accomplished. Objectives form a
hierarchy, starting from corporate mission or purposes going down to individual goals. Managers can
best determine the number of objectives they should realistically set for themselves by analyzing the
nature of the job and how much they can delegate. In any case, managers should know the relative
importance of each of their goals.

Management by Objectives(MBO) has been widely used for performance appraisal and employee
motivation, but it is really a system of managing. Among its benefits, MBO results in better managing,
often forces managers to clarify the structure of their organizations, encourages people to commit
themselves to their goals, and helps develop effective controls.

Some of its weaknesses are that managers sometimes fail to explain the philosophy of MBO (which
emphasizes self-control and self-direction) to subordinates or give them guidelines for their goal setting.
In addition, goals themselves are difficult to be set, tend to be short-term, and may become inflexible
despite changes in the environment. people, in their search for verifiable may overemphasize
quantifiable goals.

5) Strategies, policies and planning premises-

There are different definitions of a strategy. A comprehensive one refers to the determination of the
firm’s mission or purpose and its basic long-term objectives, followed by adoption of courses of action
and allocation of resources necessary to achieve these aims. Policies are general statements or
understandings that guide managers thinking in decision-making. Both strategies and policies give
direction to plans. They provide the framework for plans and serve as a basis for the development of
tactics and other managerial activities.

The strategic planning model shows how the process works. It identifies the critical elements of this
process and indicates how they relate to each other. The TOWs matrix is a modern tool for analyzing the
threats and opportunities in the external environment and their relationships to the organization’s
internal weaknesses and strengths. Three TOWS Matrices have to be developed for Mergers,
Acquisitions, joint ventures and alliances. The Portfolio matrix is a tool for allocating resources, linking
the business growth rate with the relative competitive position (measured by market share) of the firm.

The blue ocean strategy focuses on the market space with no serious competition. In contrast, the red
ocean strategy engages competitors in a bloody fight.

Major kinds of strategies and policies need to be developed in areas such as growth, finance,
organization, personnel, public relations, product or services and marketing. Strategies from a hierarchy
from the corporate level to the business level and the functional level. Porter identified three generic
competitive strategies related to overall cost leadership, differentiation and focus

Planning premise are the anticipated environment. They include assumptions or forecasts of the future
and known conditions. More recently, environmental forecasting has become important. One approach
is forecasting is the Delphi technique developed by the RAND corporation.

6) Decision Making-Decision making is the selection of a course of action from among alternatives; it is
the core of planning. Managers must make choices on the basis of limited, or bounded rationality-that
is, in light of everything they can learn about a situation, which may not be everything they should
know. Satisficing is a term sometimes used to describe picking a course of action that is satisfactory
under the circumstances.
Because there are almost always alternatives-usually many-to a course of action, managers need to
narrow them down to those few that deal with the limiting factors. These are the factors that stand in
the way of achieving a desired objective. Alternatives are then evaluated in terms of quantitative and
qualitative factors. Other techniques for evaluating alternatives include marginal analysis and cost
effectiveness analysis. Experience, Experimentation and research and analysis come into play in
selecting an alternative.

Programmed and non-programmed decisions are different. The former is suited for structured or
routine problems. These kinds of decisions are made especially by lower-level managers and
nonmanagers. Nonprogrammer decisions, on the other hand are used for unstructured and nonroutine
problems and are made especially by upper-level managers.

Virtually all decisions are made in an environment of at least some uncertainty involving interaction of a
number of important variables, and there are certain risks involved in making decisions. Managers
dealing with uncertainty should know the degree and the nature of the risk they are taking in choosing a
course of action.

Creativity, the ability and power to develop new ideas, is important for effective managing. Innovation is
the use of these ideas. The Creative process consists of four overlapping phases-unconscious scanning,
intuition, insight and logical formulation. A popular technique for enhancing creativity is brainstorming.
Creative individuals can make a great contribution to the enterprise. At the same time, they can be
disruptive by not following commonly accepted rules of behavior. Invention is the development or
discovery of something new while innovation is he enhancement, adaptation or commercialization of
new products, services or processes.

7) The nature of organizing, entrepreneuring and Re-engineering

The term organization is often used loosely. Formal organization is the intentional structure of roles.
Informal organization is a network of personal and social relations neither established nor required by
formal authority, but arising spontaneously. The span of management refers to the number of people a
manager can effectively supervise. A wide span of management results in few organizational levels, and
a narrow span results in many levels. There is no definite number of people a manager can always
effectively supervise; the number depends on several underlying factors. These include the degree of
training of subordinates that is required and is possessed, the clarity of authority delegation, the clarity
of plans. The use of objective standards, the rate of change, the effectiveness of communication
techniques, the amount of personal contact needed, and the level in the organization.

Intrapreneurs and entrepreneurs focus on innovation and creativity. It is the manager’s responsibility to
create an environment that promotes entrepreneurship.

Re-engineering that may require a re-design of business process, has become popular in some
companies The results of these efforts have shown not only positive but also some negative results.

The steps in organizing include formulating objectives and supporting objectives, policies and plans to
achieve the ends (strictly speaking, this is carried out in planning); identifying and classifying activities,
grouping these activities; delegating authority and coordinating authority as well as information
relationships.
8) organization structure-departmentation

The grouping of activities and people into departments makes organizational expansion possible.
Departmentation can be done by enterprise function, by territory or geography and by the kinds of
customers served. Other kinds of departmentation are the product organization grouping, matrix or grid
organization, project organization and the strategic business unit. The organization structure for the
global environment may vary greatly, ranging from having an export department at the headquarters to
regional groupings. With many variations in between.in addition, companies may have also one or more
functionally organized grouping within a region. The virtual organization is a loose concept of a group of
independent companies or people that are connected often through computer technology.

There is no single best way to organize; the most appropriate pattern depends on various factors in a
given situation. These factors include the kind of job to be done, the way the task must be done, the
kinds of people involved, the technology, the people served, and other internal and external
considerations. At any rate, the selection of a specific departmentation pattern should be done so that
organizational and individual objectives can be achieved effectively and efficiently. Accomplishing this
goal often requires mixing forms of departmentation.

9) Line/staff authority, empowerment and decentralization

There are a number of different bases of power. Power can be legitimate, expert, referent, reward or
coercive. Empowerment enables people to make decisions without asking their superiors for
permission. Line authority is that relationship in which a superior exercises direct supervision over
subordinates. The staff relationship, on the other hand, consists of giving advice and counsel. Functional
authority is the right to control selected processes, practices, policies or other matters in departments
other than a person’s own. It is a small slice of line manager’s authority and should be used sparingly.

Another important concept is decentralization, which is the tendency to disperse decision-making

authority. Centralization, on the other hand is the concentration of authority. It may refer to geographic
concentration, departmental centralization or the tendency to restrict delegation of decision-making.
The process of delegation of authority includes determining the results to be achieved, assigning tasks,
delegating authority for accomplishing the tasks and holding people responsible for results.

Failures in effective delegation are often due to personal attitudes. Weak delegation can be overcome by
considering the tasks and goals, maintaining open communication, establishing proper controls and
motivating through appropriate rewards. Previously decentralized authority may be recentralized.
Balance is the key to proper decentralization.

10) leadership-

Leadership is the art or process of influencing people so that they contribute willingly and
enthusiastically toward group goals. Leadership requires followership. There are various approaches to
the study of leadership, ranging from the trait to the contingency approach. One such approach focuses
on 3 Styles-Autocratic, democratic or participative and free-rein.

The managerial grid identifies two dimensions-concern for production and concern for people. On the
basis of these dimensions, four external styles and a “middle of the road” style are identified. Leadership
can also be viewed as a continuum. At one extreme of the continuum, the manager has a great deal of
freedom, while subordinates have very little. At the other extreme, manager has very little freedom,
whereas subordinates have a great deal.

Still another approach to leadership. Built on the assumption that leaders are the product of given
situations, focuses on the study of situations. Fiedler’s contingency approach takes into account the
position of power of the leader, the structure of the task, and the relations between the leader and
group members. The conclusion is that, there is no one best leadership style and that managers can be
successful if placed in appropriate situation. The path-goal approach to leadership suggests that, the
most effective leaders help subordinates achieve enterprise as well as personal goals. Transactional
leaders clarify roles and tasks, set-up a structure and help followers achieve objectives. Transformational
leaders articulate a vision, inspire other, and transform the organization. Transformational and
charismatic leadership concepts are similar.

11) The system and process of controlling

The managerial function of controlling is the measurement and correction of performance in order to
ensure that enterprise objectives and the plans devised to attain them are being accomplished. It is a
function of every manager, from president to supervisor.

Control techniques and systems are basically the same regardless of what is being controlled. Where-
ever, it is found and whatever is being controlled, the basic control process involves 3 steps-

1)Establishing standards 2) measuring performance against these standards 3) correcting variations from
standards and plans. There are different kinds of standards, and all should point out deviations at critical
points. Performance can be measured against best industry practices, an approach known as
benchmarking.

Managerial control is usually perceived as a simple feedback system similar to the common household
thermostat. However, no matter how quickly information is available on what is occurring (even real
time information, which is information on what is happening as it happens). there are unavoidable
delays in analyzing deviations, developing plans for taking corrective action and implementing these
programs. In order to overcome these time lags in control, it is suggested that, managers utilize a
feedforward control approach and not rely on simple feedback alone. Feedforward control requires
designing a model of a process or system and monitoring inputs with a view to detecting future
deviations of results from standards and plans thereby giving managers time to take corrective action
before problems occur.

Many overall controls are financial, one of which is profit and loss control. Another is the exercise of
control through calculating and comparing return on investment. This approach is based on the idea
that profit should be considered not as an absolute measure but as a return on the capital employed in a
business or a segment of it. The management audit has also been used as a control device. Bureaucratic
control is based on rules, regulations, policies, procedures and formal authority. On the other hand,
clean control is influenced by norms, shared values, and expected behavior.

If controls are to work, they must be specially tailored to plans and positions, to individual managers,
and to the needs for efficiency and effectiveness. To be effective, controls also should be designed to
point up exceptions at critical points to be objective, flexible, to fit the organization culture, to be
economical, and to lead to corrective action.
12) Control techniques and information technology-

A variety of tools and techniques have been used to help managers control. These techniques are
generally, in the first instance, tools for planning, and they illustrate the fact that controls must reflect
plans. Some of these tools have long been used by managers; others are refinements. One of the older
control devices is the budget. Budgeting is the formulation of plans for a given future period in
numerical terms. There are also dangers in Budgeting. Budgeting is made much more precise by zero-
base budgeting, in which programs are divided into ‘packages’. The costs for each package are
calculated from a base of zero. In order to make budgetary control effective in practice, managers must
always realize that budgets are tools and are not intended to replace managing. Among the traditional
non-budgetary control devices are statistical data and their analyses, special reports and analyses, the
operational audit, and personal observation.

One of the techniques of planning and control is the time-event network analysis. The program
evaluation and review technique(PERT) is a refinement of the original Gantt chart, which was designed
to show, in bar chart form, the various tasks that must be done, and when, in order to accomplish a
program. PERT is also a refinement of milestone budgeting, in which the tasks that have to be done are
broken down into identifiable and controllable pieces called milestones. When milestones are
connected to form a network and the time required to complete each milestone is identified, the result
is a PERT/time-event network. Using the sequences of events and the times required for them, one can
determine the critical path, which is the sequence that takes the longest time and has zero (or the least)
slack time.

The management information system is a formal system of gathering, integrating, comparing, analyzing
and dispersing information, internal and external to the enterprise in a timely, effective and efficient
manner to support managers in their work.

Computers (mainframes, minicomputers and microcomputers) are now extensively used. Their impact
on managers at various organizational levels differs. Information technology provides many challenge.
Some managers still resist using computers, but speech recognition devices will encourage computer
use. Computers have also contributed to telecommuting, allowing people to work from home at a
computer that is linked to a company’s mainframe computer. Increasingly, computer networks are
installed to link workstations with each other, with large computers, and with peripheral equipment.

The internet revolution brings exciting new opportunities for business and personal life. It is changing
the way how business is conducted. The relationship with suppliers and customers are changing
dramatically. There is now a new trend towards wireless communications and m-commerce, especially
in Japan and Europe. Customer Relationship Management (CRM) aims at serving the needs of its clients.