Principles of

Management
Introduction to
Management
and
Organizations
CHAPTER-1
 AFTER STUDYING THIS CHAPTER YOU SHOULD BE
ABLE TO:

□ Define Business and describe the characteristics of

Organization.
□ Differentiate between managerial and non-managerial
employees.
□ Describe Management.
□ Explain the functions, roles, and skills of managers and
how the manager's job is changing.
□ Recognize the value of studying Management
SOME IMPORTANT TERMS
TO KNOW
 a. Business
□ The term “Business” signifies individual &
group activities directed towards wealth
generation through goods & services (recognized
by the law).

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b. Organization
A group of people working together in a structured
and coordinated fashion to achieve a set of goals is
called organization.
Structure

Goals B

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c. Goals
Goals are the end results towards which all the activities are
directed. Different organizations may have different goals. e.g.
Profitability, Growth, Market Penetration, Productivity,
Leadership, Client Satisfaction etc.

d. Objectives
Objectives are sub goals.
What is Management?
 Management
Coordination and oversight of the work activities
of others so that their activities are completed
efficiently and effectively.

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 Effectiveness VS Efficiency
Doing the right things , or completing activities
so that organization goals are attained, called
Effectiveness.

Doing the things right, or getting the most output

from the least amount of inputs, called
Efficiency.
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Why Efficiency & Effectiveness are important to
Management
 What are the functions of
Management?

OR

What is Management Process?

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 Functions ofManagement
Planning
Choose Goals

Controlling Organizing
Monitor & measure Working together

Leading
Coordinate

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 1-Planning
A Management function that
involves defining goals,
establishing strategies for
achieving those goals, and
developing plans to integrate
and coordinate activities.
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Planning Process consists of
five steps
■ Objective-setting
■ Forecasting
■ Strategy formation
■ Setting specific standards
■ Continual review and
revision
 2-Organizing
Organizing is the establishment of
relationship between:
□ Activities Function of Organizing involves:
□ Persons
□ Physical factors 1. Division of Labor
or 2. Departmentalization
Structuring working relationships in away 3. Staff positioning
that allows organizational members 4. Assigning authority or
Delegation of power
to achieve organizational goals.
5. Equalizing authority and
responsibility

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 3-Leading

Management function that

involves working with and
through people to accomplish
organizational task.
Components involve in leading
function are:
In leading functions subordinates 1. Supervision
are guided, supervised and
2. Motivation
motivated by managers
3. Communication
4. Bringing about change
5. Managing conflict
 4-Controlling

Management function that

involves monitoring actual
performance ,comparing
standards, and taking corrective Process consist of:
actions if necessary.
1.Measuring
2.Comparing
3.Correcting

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 Controlling Process
SET MEASURE
PERFORMAN PERFORMAN
COMPARE DETERMINE
CE CE DEVIATION
STANDARDS

WITHIN
STANDARDS
LIMITS

TAKE
CORRECTIV
E NO YES
ACTION

CONTINUE
WORK
PROGRESS
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Management Functions
Management as Systematic Approach
Inputs
i. Human Resources
ii. Financial Resources
iii. Physical Resources
iv. Information Resources Effectively

Goals
+
ORGAN
Completion
of Goals

IZING

MANAGEME
PLANNING NT Leading
PROCESS

19 CONTROLLING
 Manager
Managers are those people who work with
and through other people for getting
activities completed in order to accomplish
organizational goals.

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Difference between Managers and Operatives

□ Operatives are people who work

directly on a job or task & have no
responsibility for overseeing the work
of others.
In contrast
□ Managers direct the activities of other
people in the organization.

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 What are their Objectives?
To achieve the organizational goal, managers pursue the
following objectives.
■ Efficient use of resources
■ Customer satisfaction
■ Adequate return on capital
■ Satisfied workforce
■ Improved work conditions
■ Building supplier relationship
■ Contribution to national goal

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 Kinds of Managers

Basically there are three

levels of managers

i. Top Managers
ii. Middle Managers
iii. First-line Managers

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 Top Managers

Managers at or near the top of the organization

who are responsible for making organizational-
wide decisions and establishing the goals and
overall strategy are called Top Managers.

Titles found in this group include President, Vice

President, CEO, Chairman of the Board etc.

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 Middle Managers

Middle Level Managers are primarily responsible for

implementing policies and the plans developed by the top
managers and for supervising and coordinating the
activities of lower level mangers.
Titles found in this group are Plant Manager, Operational
manager, Branch Manager or Departmental Head etc.

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 First-line Manager
First-line Managers supervise and coordinate the
activities of operating employees.

Titles found in this group are supervisors,

Coordinator, Shift and Office Managers.

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 Basic
Managerial
Roles & Skills
 Managerial Role.
The managerial roles are divided into three
basic categories identified by Henry
Mintzberg.

1. Interpersonal Role
2. Informational Role
3. Decisional Role

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29
 Managerial Skills

There are number of skills that a Manager

needs but three of them are pre-requisite
to their success

■ Technical Skills
■ Interpersonal Skills
■ Conceptual Skills

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 Technical Skills
Job specific Knowledge and techniques in a
specialized field is termed as Technical
Skills.
Technical skills are specially input for first line
managers. These manager spend much of their
time in training subordinates and answering
questions about work related problems. They
must know how to perform the task assigned to
those they supervise if they are to be effective
managers.

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 Interpersonal Skills
The ability to communicate, with understand and motivate

both individual and groups is called Interpersonal

Skills or human skills.
Manager spend considerable time in interacting with people
both inside and outside the organization. e.g. Workers,
customers, suppliers, investor. Manager with good
communication skills are able to get the best out of their
people. They know how to communicate, motivate, lead and
inspire. These skills are equally important at level of
managers.
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 Conceptual Skills
The manager’s ability to think and to conceptualize
about abstract and complex situations are called
Conceptual Skills.
Using these skills manager must be able to see the
organization as a whole, understand the relationship
among various subunits, and visualize how the
organization fits into its broader environment, these
skills are most important at top level management.

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Skills Needed at Different
Management Levels
 HOW THE
MANAGER’S JOB IS
CHANGING

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 The Universality of Management

The reality that management is needed in all

types and sizes of organization, at all
organizational levels, in all organizational
areas, and in organization no matter where
located.

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Universal Need for Management
 The Reality of Work

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 Effectiveness
Equalizing authority &
Review & Revision Responsibility
Efficiency
Standard Setting Delegation of Power

Strategy Formation Staff Positioning

Forecasting Departmentalization Components of

Management
Goal setting Division of labor

PLANNING ORGANIZING All sizes of Organizations

All Types of Organizations

Functions
Universality of
Management All Organizational Levels
MANAGEMENT
LEADING CONTROLLING

Motivation Measuring
Communication
Comparing Changes and
Management
Bringing Change Correcting

Managing Conflicts
Manager
Supervision
Digitization
Levels
Interpersonal Roles
Skills Changing security threats
Top Level
Informational
Figure Head
Technical Skills Organizational & Managerial Ethics
Decisional Middle Level
Leader Monitor

Entrepreneur Interpersonal skills First level Increased Competitiveness

Liaison Disseminator

Resource Allocator Conceptual Skills

Spokes person
Negotiator
Diagnostic Skills
Disturbance Handler