MEANI

NGOFMANAGEMENT.

Def
ini
ti
onandScope

Amor
eel
abor
atedef
ini
ti
ongi
venbyGeor
geR.Ter
ry,
def
inesmanagementasapr
ocess

"
consi
sti
ngofpl
anni
ng,or
gani
zi
ng,act
uat
ingandcont
rol
l
ing,per
for
medt
odet
ermi
ne

andaccompl
i
sht
heobj
ect
ivesbyt
heuseofpeopl
eandr
esour
ces.
"Fi
rst
lyi
tconsi
der
s

managementasa"
process"i
.e.asy
stemat
icwayofdoi
ngt
hings.Secondl
yitst
ates

f
ourmanagementact
ivi
ti
es:Pl
anni
ng,
organi
zi
ng,
act
uat
ing,
andcont
rol
l
ing.Pl
anni
ngi
s

t
hinki
ngofanact
ionsi
nadv
ance.or
gani
zi
ngi
scoor
dinat
ionoft
hehumanandmat
eri
al

r
esour
cesofanor
gani
zat
ion.Act
uat
ingi
smot
ivat
ionanddi
rect
ionofsubor
dinat
es.

Cont
rol
l
ingmeanst
heat
temptt
oensur
enodev
iat
ionf
rom t
henor
m orpl
an.Thi
rdl
yit

st
atest
hatmanagerusespeopl
eandot
herr
esour
ces.Forexampl
eamanagerwho

want
stoi
ncr
easet
hesal
es,mi
ghtt
rynotonl
ytoi
ncr
easet
hesal
esf
orce,butal
sot
o

i
ncr
easeadv
ert
isi
ngbudget
.Andf
our
thl
y,i
tst
atest
hatmanagementi
nvol
vest
heactof

achi
evi
ngt
heor
gani
zat
ion'
sobj
ect
ives.

Managementhasbeenseenf
rom v
ari
ousv
iewsas:

 Accor
dingt
oHenr
iFay
ol,"
tomanagei
stof
orecastandt
opl
an,t
oor
gani
se,t
o

command,
toco-
ordi
nat
eandt
ocont
rol
.
"

 Fr
edmundMal
i
kdef
inesi
tas"
thet
ransf
ormat
ionofr
esour
cesi
ntout
il
it
y."

 Managementi
sincl
uded asoneoft
hef
act
orsofpr
oduct
ion – al
ong wi
th

machi
nes,
mat
eri
alsandmoney
.
 Ghi
slai
nDesl
andesdef
inesi
tas“
avul
ner
abl
efor
ce,underpr
essur
etoachi
eve

r
esul
ts and endowed wi
tht
he t
ri
ple power of const
rai
nt,i
mit
ati
on and

i
magi
nat
ion, oper
ati
ng on subj
ect
ive, i
nter
per
sonal
, i
nst
it
uti
onal and

env
ironment
all
evel
s”.

 Pet
erDr
ucker(
1909–2005)saw t
hebasi
ctaskofmanagementast
wof
old:

mar
ket
ingandi
nnov
ati
on.Nev
ert
hel
ess,i
nnov
ati
oni
sal
sol
i
nkedt
omar
ket
ing

(
producti
nnov
ati
on i
s a cent
ralst
rat
egi
c mar
ket
ing i
ssue)
.Pet
erDr
ucker

i
dent
if
iesmar
ket
ingasakeyessencef
orbusi
nesssuccess,butmanagement

andmar
ket
ingar
egener
all
yunder
stoodast
wodi
ff
erentbr
anchesofbusi
ness

admi
nist
rat
ionknowl
edge.

 I
nanot
herwayoft
hinki
ng,Mar
yPar
kerFol
l
ett(
1868–1933)
,al
l
egedl
ydef
ined

managementas"
thear
tofget
ti
ngt
hingsdonet
hroughpeopl
e".
Shedescr
ibed

managementasphi
l
osophy
.

 "
Managementi
sthe coor
dinat
ion ofal
lresour
ces t
hrough t
he pr
ocess of

pl
anni
ng,or
gani
sing,di
rect
ing and cont
rol
l
ing i
n or
der t
o at
tai
n st
ated

goal
s."
(Henr
ySi
sk)

 "
Managementi
sasoci
alandt
echni
cal
processt
hatut
il
isesr
esour
ces,
inf
luences

humanact
ionandf
aci
l
itat
eschangesi
nor
dert
oaccompl
i
shanor
gani
zat
ion'
s

goal
s."
(ThoHar
mann,
Wil
l
iam Scot
t)

 "
Managementi
sar
esponsi
ble per
son'
s orgr
oup’
sthi
nki
ng pr
ocesses and
 admi
nist
rat
ivepr
ocessesdi
rect
edatachi
evi
ngt
hepur
pose,needs,aspi
rat
ions

andobj
ect
ivesofanor
gani
zat
ion,
proj
ectort
askt
hroughpeopl
e."

 Managementi
nvol
vesi
dent
if
yingt
hemi
ssi
on,obj
ect
ive,pr
ocedur
es,r
ulesand

mani
pul
ati
onoft
hehumancapi
talofanent
erpr
iset
ocont
ri
but
etot
hesuccess

of t
he ent
erpr
ise. Thi
s i
mpl
i
es ef
fect
ive communi
cat
ion: an ent
erpr
ise

env
ironment(
as opposed t
o a phy
sicalormechani
calmechani
sm)i
mpl
i
es

humanmot
ivat
ionandi
mpl
i
essomesor
tofsuccessf
ulpr
ogr
essorsy
stem

out
come.

Managementmost
lyi
mpl
i
est
heor
gani
zat
ionandcoor
dinat
ionoft
heact
ivi
ti
esofa

busi
nessi
nor
dert
oachi
evedef
inedobj
ect
ives.Managementi
sof
teni
ncl
udedasa

f
act
orofpr
oduct
ional
ongwi
thmachi
nes,mat
eri
als,andmoney
.Accor
dingt
othe

managementgur
uPet
erDr
ucker(
1909-
2005)
,thebasi
ctaskofmanagementi
ncl
udes

bot
hmar
ket
ingandi
nnov
ati
on.Pr
act
iceofmoder
nmanagementor
igi
nat
esf
rom t
he

16t
hcent
uryst
udyofl
ow-
eff
ici
encyandf
ail
uresofcer
tai
nent
erpr
ises,conduct
edby

t
heEngl
i
shst
atesmanSi
rThomasMor
e(1478-
1535)
.Managementconsi
stsoft
he

i
nter
locki
ngf
unct
ionsofcr
eat
ingcor
por
atepol
i
cyandor
gani
zi
ng,pl
anni
ng,cont
rol
l
ing,

anddi
rect
inganor
gani
zat
ion'
sresour
cesi
nor
dert
oachi
evet
heobj
ect
ivesoft
hat

pol
i
cy.

Thedi
rect
orsandmanager
swhohav
ethepowerandr
esponsi
bil
i
tyt
omakedeci
sions

andov
erseeanent
erpr
isei
sal
sor
efer
redt
oasmanagement
.
The si
ze ofmanagementcan r
ange f
rom one per
son i
n a smal
lor
gani
zat
ion t
o

hundr
edsort
housandsofmanager
sinmul
ti
nat
ional
compani
es.

Pr
inci
plesofManagement

Managementi
sessent
ialt
oanyor
gani
zat
iont
hatwi
shest
obeef
fi
cientandachi
evei
ts

ai
ms.Wi
thoutsomeonei
naposi
ti
onofaut
hor
it
yther
ewoul
dbeor
gani
zat
ionalanar
chy

wi
thnost
ruct
ureandv
eryl
i
ttl
e,i
fanyf
ocus.I
thasbeensai
dthatmanagementhasf
our

basi
cfunct
ions

 Pl
anni
ng

 Or
gani
zi
ng

 Di
rect
ingorLeadi
ng

 Cont
rol
l
ing.

Commonsensedi
ctat
est
hatwi
thoutt
hesepr
inci
plesofmanagementbei
ngi
npl
acean

or
gani
zat
ionwoul
dhav
etr
oubl
eachi
evi
ngi
tsai
ms,orev
encomi
ngupwi
thai
msi
nthe

f
ir
stpl
ace!Acl
assi
ctheor
yont
hepr
inci
plesofmanagementwaswr
it
tenbyHenr
iFay
ol.

I
tseekst
odi
vi
demanagementi
nto14pr
inci
ples.

We’
l
ltakeal
ookatt
hebasi
cpr
inci
plesofmanagementandexpl
aint
hem i
neasyt
o

under
standt
ermi
nol
ogy
.

 Pl
anni
ng
Pl
anni
ng i
sthe f
unct
ion of management t
hat i
nvol
ves set
ti
ng obj
ect
ives and

det
ermi
ningacour
seofact
ionf
orachi
evi
ngt
hoseobj
ect
ives.Pl
anni
ngr
equi
rest
hat

manager
sbeawar
eofenv
ironment
alcondi
ti
onsf
aci
ngt
hei
ror
gani
zat
ionandf
orecast

f
utur
econdi
ti
ons.I
tal
sor
equi
rest
hatmanager
sbegooddeci
sionmaker
s.

Pl
anni
ng i
s a pr
ocess consi
sti
ng of sev
eralst
eps.The pr
ocess begi
ns wi
th

env
ironment
alscanni
ngwhi
chsi
mpl
ymeanst
hatpl
anner
smustbeawar
eoft
hecr
it
ical

cont
ingenci
es f
aci
ng t
hei
r or
gani
zat
ion i
nter
ms of economi
c condi
ti
ons,t
hei
r

compet
it
ors,and t
hei
rcust
omer
s.Pl
anner
s mustt
hen at
temptt
ofor
ecastf
utur
e

condi
ti
ons.Thesef
orecast
sfor
mthebasi
sforpl
anni
ng.

 Or
gani
zi
ng

Or
gani
zi
ngi
sthef
unct
ionofmanagementt
hati
nvol
vesdev
elopi
nganor
gani
zat
ional

st
ruct
ureandal
l
ocat
inghumanr
esour
cest
oensur
etheaccompl
i
shmentofobj
ect
ives.

Thest
ruct
ureoft
heor
gani
zat
ioni
sthef
ramewor
kwi
thi
nwhi
chef
for
tiscoor
dinat
ed.

Thest
ruct
urei
susual
l
yrepr
esent
edbyanor
gani
zat
ionchar
t,whi
chpr
ovi
desagr
aphi
c

r
epr
esent
ati
onoft
hechai
nofcommandwi
thi
nanor
gani
zat
ion.Deci
sionsmadeabout

t
hest
ruct
ureofanor
gani
zat
ionar
egener
all
yref
err
edt
o asor
gani
zat
ionaldesi
gn

deci
si
ons.

Or
gani
zi
ngal
soi
nvol
vest
hedesi
gnofi
ndi
vi
dualj
obswi
thi
ntheor
gani
zat
ion.Deci
sions

mustbemadeaboutt
hedut
iesandr
esponsi
bil
i
tiesofi
ndi
vi
dualj
obs,aswel
last
he

manneri
nwhi
cht
hedut
iesshoul
dbecar
ri
edout
.Deci
sionsmadeaboutt
henat
ureof

j
obswi
thi
ntheor
gani
zat
ionar
egener
all
ycal
l
ed“
jobdesi
gn”deci
sions.
Or
gani
zi
ng at t
he l
evel of t
he or
gani
zat
ion i
nvol
ves deci
ding how best t
o

depar
tment
ali
ze,
orcl
ust
er,
jobsi
ntodepar
tment
stocoor
dinat
eef
for
tef
fect
ivel
y.Ther
e

ar
emanydi
ff
erentway
stodepar
tment
ali
ze,i
ncl
udi
ngor
gani
zi
ngbyf
unct
ion,pr
oduct
,

geogr
aphy
,or cust
omer
. Many l
arger or
gani
zat
ions use mul
ti
ple met
hods of

depar
tment
ali
zat
ion.

 Di
rect
ingorLeadi
ng

Leadi
ngi
nvol
vest
hesoci
alandi
nfor
malsour
cesofi
nfl
uencet
haty
ouuset
oinspi
re

act
iont
akenbyot
her
s.I
fmanager
sar
eef
fect
ivel
eader
s,t
hei
rsubor
dinat
eswi
l
lbe

ent
husi
ast
icaboutexer
ti
ngef
for
ttoat
tai
nor
gani
zat
ional
obj
ect
ives.

Thebehav
ior
alsci
enceshav
emademanycont
ri
but
ionst
ounder
standi
ngt
hisf
unct
ion

ofmanagement
.Per
sonal
i
tyr
esear
chandst
udi
esofj
obat
ti
tudespr
ovi
dei
mpor
tant

i
nfor
mat
ionast
ohowmanager
scanmostef
fect
ivel
yleadsubor
dinat
es.Forexampl
e,

t
hisr
esear
ch t
ell
s us t
hatt
o become ef
fect
ive atl
eadi
ng,manager
s mustf
ir
st

under
standt
hei
rsubor
dinat
es’
per
sonal
i
ties,
val
ues,
att
it
udes,
andemot
ions.

 Cont
rol
l
ing

Cont
rol
l
ing i
nvol
ves ensur
ing t
hatper
for
mance does notdev
iat
efr
om st
andar
ds.

Cont
rol
l
ingconsi
stsoft
hreest
eps,
whi
chi
ncl
ude

1.est
abl
i
shi
ngper
for
mancest
andar
ds,

2.compar
ingact
ual
per
for
manceagai
nstst
andar
d
 3.t
aki
ng cor
rect
ive act
ion when necessar
y.Per
for
mance st
andar
ds ar
e of
ten

st
atedi
nmonet
aryt
ermssuchasr
evenue,cost
s,orpr
ofi
tsbutmayal
sobe

st
atedi
not
hert
erms,suchasuni
tspr
oduced,numberofdef
ect
ivepr
oduct
s,or

l
evel
sofqual
i
tyorcust
omerser
vice.

Themeasur
ementofper
for
mancecanbedonei
nsev
eralway
s,dependi
ngont
he

per
for
mancest
andar
ds,
incl
udi
ngf
inanci
alst
atement
s,sal
esr
epor
ts,
product
ionr
esul
ts,

cust
omersat
isf
act
ion,and f
ormalper
for
mance appr
aisal
s.Manager
s atal
llev
els

engagei
nthemanager
ial
funct
ionofcont
rol
l
ingt
osomedegr
ee.

14Pr
inci
plesofManagementwr
it
tenbyHenr
iFay
ol

 Di
vi
sionofWor
k–Thi
spr
inci
pleofmanagementi
sbasedont
het
heor
ythati
f

wor
ker
sar
egi
venaspeci
ali
zedt
askt
odo,t
heywi
l
lbecomeski
l
lfulandmor
e

ef
fi
cienti
nitt
hani
ftheyhadabr
oaderr
angeoft
asks.Ther
efor
e,apr
ocess

wher
eev
ery
onehasaspeci
ali
zedr
olewi
l
lbeanef
fi
cientone.

 Aut
hor
it
y–Thi
spr
inci
plel
ooksatt
heconceptofmanager
ialaut
hor
it
y.I
tlooksat

how aut
hor
it
yisnecessar
yinor
dert
oensur
ethatmanager
ialcommandsar
e

car
ri
edout
.Ifmanager
sdi
dnothav
eaut
hor
it
ythent
heywoul
dlackt
heabi
l
ityt
o

getwor
k car
ri
ed out
.Manager
s shoul
d use t
hei
raut
hor
it
yresponsi
blyand

et
hical
l
y.

 Di
sci
pli
ne–Thi
spr
inci
pler
elat
est
othef
actt
hatdi
sci
pli
nei
sneededwi
thi
nan
 or
gani
zat
ion f
ori
ttor
un ef
fect
ivel
y.Or
gani
zat
ionalr
ules,phi
l
osophi
es,and

st
ruct
uresneedt
obemet
.Inor
dert
ohav
edi
sci
pli
nedwor
ker
s,manager
smust

bui
l
dacul
tur
eofmut
ual
respectandmot
ivat
ion.

 Uni
tyofcommand–Ther
eshoul
dbeacl
earchai
nofcommandi
npl
acewi
thi
n

anor
gani
zat
ion.Anempl
oyeeshoul
dknowexact
lywhosei
nst
ruct
ionst
ofol
l
ow.

 Uni
tyofdi
rect
ion–Wor
kshoul
dbeor
gani
zedi
nawayt
hatmeansempl
oyees

ar
ewor
kingi
nhar
monyt
owar
dashar
edobj
ect
iveorgoalusi
ngashar
edmet
hod

orpr
ocedur
e.

 Subor
dinat
ioni
ndi
vi
dual
int
erest
stot
hecol
l
ect
ivei
nter
est
s–Thei
nter
est
soft
he

or
gani
zat
ion as a whol
e shoul
dtake pr
ecedence ov
ert
he i
nter
est
s ofany

i
ndi
vi
dualempl
oyeeorgr
oupofempl
oyees.Thi
sencour
agesat
eam spi
ri
tand

col
l
ect
ivement
ali
tyofal
lforoneandonef
oral
l
.

 Remuner
ati
on–I
nor
dert
omot
ivat
eandbef
airt
oempl
oyees,t
heyshoul
dbe

pai
dar
easonabl
erat
efort
he wor
kthey car
ry out
.An or
gani
zat
ion t
hat

under
pay
swi
l
lst
ruggl
etoat
tractqual
i
tywor
ker
swhoar
emot
ivat
ed.

 Cent
ral
i
zat
ion– Thi
spr
inci
pler
elat
est
owhet
herdeci
sionsshoul
dbemade

cent
ral
l
y,asi
nfr
om t
het
opdown,
ori
namor
edemocr
ati
cway
,fr
om t
hebot
tom

up.Di
ff
erentdeci
sionmaki
ngpr
ocessesar
eappr
opr
iat
efordi
ff
erentt
ypesof

deci
sions.

 Scal
archai
n–Thi
srel
atest
othepr
inci
pleofacl
earchai
nofcommuni
cat
ion
 exi
sti
ng bet
ween empl
oyeesand super
ior
s.Thechai
n shoul
d ber
espect
ed,

unl
essspeedycommuni
cat
ioni
svi
tal
,i
nwhi
chcaset
hechai
nmaybeby
passed

i
fal
lpar
ti
esconsent
.

 Or
der– Thi
srel
ates t
othe pr
operuse ofr
esour
ces and t
hei
ref
fect
ive

depl
oymenti
nast
ruct
uredf
ashi
on.

 Equi
ty–Manager
sshoul
dbehav
eet
hical
l
ytowar
dst
hoset
heymanage.Al
most

ev
eryor
gani
zat
ioni
nthemoder
nwor
ldwi
l
lhav
eawr
it
tensetofpol
i
ciesand

pr
ocedur
eswhi
chwi
l
lout
li
neexact
lywhati
sexpect
edf
rom st
affatal
ll
evel
s.

 St
abi
l
ityoft
enur
eofper
sonnel–I
tisseenasdesi
rabl
ewi
thi
nanor
gani
zat
iont
o

hav
eal
owst
afft
urnov
err
ate.Thi
sisduet
othebenef
it
sthatcomewi
thhav
ing

exper
iencedst
affandt
het
imeandexpenseneededt
otr
ainnew ones.Ther
e

shoul
dbeacl
earandef
fi
cientmet
hodoff
il
li
nganyst
affv
acanci
est
hatar
ise.

 I
nit
iat
ive–Empl
oyeest
hathav
eani
nputast
ohowt
obestdot
hei
rjobar
eli
kel
y

t
ofeelmor
emot
ivat
edandr
espect
ed.Manyor
gani
zat
ionspl
aceagr
eatdealof

emphasi
sonl
i
steni
ngt
otheconcer
nsofst
aff
.

 Mor
ale–Keepi
ngahi
ghl
evelofmor
aleandt
eam spi
ri
tisanessent
ialpar
tof

hav
ing t
he most pr
oduct
ive or
gani
zat
ion possi
ble.Happy and mot
ivat
ed

empl
oyeesar
efarmor
eli
kel
ytobepr
oduct
iveandl
essabsent
.

Pr
inci
plesofManagementi
simpor
tantsi
ncehav
ingacl
earmanagementst
ruct
urei
n

pl
ace i
svi
talf
or any successf
ulor
gani
zat
ion. Ef
fi
cient and wel
lint
ent
ioned
managementset
sthet
onef
ort
her
estoft
hest
aff
.Iti
scommonf
ort
heat
ti
tude

appr
oachofmanager
stof
il
tert
hrought
heent
ir
eor
gani
zat
ion,sohav
ingmanager
s

wor
kingi
nanexempl
arywayi
sanexcel
l
entexampl
eforempl
oyeest
ofol
l
ow.

ManagementPr
act
ices

Managementpr
act
icesusual
l
yref
erst
othewor
kingmet
hodsandi
nnov
ati
onst
hat

manager
suset
oimpr
ovet
heef
fect
ivenessofwor
ksy
stems.Commonmanagement

pr
act
icesi
ncl
ude:empower
ingst
aff
,tr
aini
ngst
aff
,int
roduci
ngschemesf
ori
mpr
ovi
ng

qual
i
ty,andi
ntr
oduci
ngv
ari
ousf
ormsofnew t
echnol
ogy
.Lear
nmor
ein:Mul
ti
-Agent

Si
mul
ati
on and ManagementPr
act
ices 2.An ent
it
y of i
nst
rument
sto suppor
t

i
mpl
ement
ati
onofconcept
sandi
deasatal
llev
elsofconcept
ual
i
zat
ionandr
eal
i
zat
ion

ofconcept
s,ul
ti
mat
elyai
mingt
osuppor
tor
gani
zat
ional
processes.

Engi
neer
ingmanagementi
stheappl
i
cat
ionoft
hepr
act
iceofmanagementt
othe

pr
act
iceofengi
neer
ing.
Engi
neer
ingmanagementi
sacar
eert
hatbr
ingst
oget
hert
he

t
echnol
ogi
cal pr
obl
em-
sol
vi
ng abi
l
ity of engi
neer
ing and t
he or
gani
zat
ional
,

admi
nist
rat
ive,
andpl
anni
ngabi
l
iti
esofmanagementi
nor
dert
oov
erseet
heoper
ati
onal

per
for
manceofcompl
exengi
neer
ingdr
ivenent
erpr
ises.