PRINCIPLES OF MANAGEMENT

AP Shareef MBA, M.Com, NET

Asst. Professor in Management, Markaz Law College
MODULE 1- CHAPTERS
1. Introduction to Management
2. Development of Management Thought

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

Chapter

1 INTRODUCTION TO MANAGEMENT
Meaning and definition
Nature and scope
Roles and functions of managers

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

Meaning and definition

Management is the wide term used to refer the

management of Men, Materials, Machines,
Methods and Money. It has two important
dimensions
1. To mobilise, co-ordinate and make efficient
utilization of all inputs or resources for the
achievement of organizational objectives
2. Efficiently discharge the responsibilities
towards its own members and society at large.

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

Meaning and definition

 The most popular definition for management is given

by Mary Parker Follet. According to her “management
is the art of getting things done through other people”
 According to George R Terry, “management is a
distinct process consisting of planning, organizing,
actuating and controlling, utilizing in each both
science and art, and followed in order to accomplish
predetermined objectives.”

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

Importance of management

Management
Efficiently utilizes resources

Accomplishes group goals

Copes with changes.

Supports economic development

Reduces the cost

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

 Management is universal
Features of management
Management is a group activity
Management aims towards predetermined
goals
Management is a system of authority

Management is a process

Management is intangible

Management influences human behaviour

Management is dynamic and life giving

Management integrates efforts.

Management is a social process.

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES
 PLANNING
Scope/functions of

 The function of management which decides in advance

management

what to be done in the future. It is a thinking

function.
 It is the determination of
 what to be done?
 How to be done?
 Where to be done?
 Who is to do?

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

 ORGANIZING
 Organizing means to arrange the resources which are
Scope/functions of

used in operations.
management

 Once the plans are laid out, the next is to set them
into actions with supporting resources.
 Planning is thinking but organizing is doing.

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

 STAFFING
It is the function of procuring adequate staff to the
Scope/functions of


organization. It includes recruitment, selection,
management

placement, training, growth and development,

promotion, transfer, remuneration, etc.

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

 DIRECTING
Scope/functions of

It is also known as leading or actuating. It is to move

management


the efforts towards the predetermined objectives.
Major sub functions are
 Communication
 Leadership
 Supervision
 Motivation

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

 CONTROLLING
Scope/functions of

 The function of ensuring that the performance is in

conformity with plans, instructions and principles is
management

controlling. Its elements are

 Establishing standards of performance
 Measuring current performance and comparing it against
the established standards
 Taking action to correct any performance that doest not
meet the standards.

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

 COORDINATION
Scope/functions of

 It means integrating the activities done by different

management

functional departments groups and individuals so as

to reach the common goal
 According to Henry fayol “it harmonises, synchronises
and unifies individual efforts for better action and for
the betterment of objectives”
 It needs integration, balancing and timing to coordinate
the activities

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

Management as a science MANAGEMENT AS A SCIENCE
 What is a science?
1. Methods of inquiry are systematic and empirical.
2. Information can be ordered and analysed
3. Results are cumulative and communicable.

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

Management as a science

 Checking the first parameter

 Being systematic means orderly and unbiased. It
emphasizes that the attempt to gain knowledge is to be
without prejudgement
 More over the enquiry must be empirical and not an
armchair speculation approach.

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

Management as a science

 Checking the second parameter

 All raw data in science can be scientifically ordered and
analysed with the help of statistical tools and hence it is
communicable and intelligible.
 The first experiment results give more confidence if the
same result is obtained by another investigator when
replicated.

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

Management as a science

 Checking the third parameter

 Cumulative means, the developments in the original
theory is added to the previous.
 When somebody starts to do something to solve a
problem, we may not start afresh, but may depend upon
the base which has been already made.

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Management as a science

Conclusion
The word science means natural or exact science and
behavioural or inexact science. Management falls in the
second category because in Physics or chemistry it is
possible for us to study the effects anyone of the factors
affecting a phenomenon individually by keeping other
factors temporarily inoperative. This method cant be
applied in management where we have to consider
multiplicity of facts

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

 MANAGEMENT AS AN ART
Management as an art

 Science is learning why? of a phenomenon. But

art is about how ? Of it. Management in the
sense is more art. It is the art of getting things
done through other people.
 Art simply means to apply the knowledge and
personal skills to get through desired results. If a
subject is theory, its practice is art.

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

Management as an art

 Essential features of art

1. Practical knowledge
2. Personal skill
3. Concrete results
4. Creativity
5. Perfection through practice

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

Management as an art

 Checking the first feature

 To perform managerial functions such as planning,
organizing, staffing etc. A manager has to possess not only
theoretical knowledge but also practical know-how. Then
only he can forecast future and make proper precautions.

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

Management as an art

 Checking the second feature

 Irrespective of similar qualifications, each person has his
own style and approach on which success depends. This is
what is called personal skill. This is true for managers.
Their triumph is more due to their personal skills than
technical knowledge.

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

Management as an art

 Checking the third feature

 Art is result oriented, or actions in art has to lead towards
a concrete result. All the managers work for some
predetermined objectives.

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

Management as an art

 Checking the fourth feature.

 Art is always do something differently. It requires
imagination and intelligence. In an organization the
manager combine the factors of production with creative
ways in order to achieve efficient results.

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

Management as an art

 Checking the fifth feature

 “Practice makes a man perfect” , “experience is the best
school teacher” . These two are true in case of both art and
management. So doubtlessly we can say management is an
art in the sense.

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

Management as a profession
MANAGEMENT AS A PROFESSION
 According to McFarland, following are the
characteristics of a profession.
1. Existence of an organized and systematic
knowledge.
2. Formalized methods of acquiring training and
experience
3. Existence of an association with professionalization
as its goal
4. Charging of fees based on service, but with due
regard for the priority of service over the desire for
monetary reward.
5. Existence of an ethical code to regulate the
behaviour of the members of the profession
AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES
AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES
Management as a profession

 Management has its own theories and subjects. Its an

emerging discipline which deals with many sub topics
such as
1. HR Management
2. Marketing Management
3. Financial Management
4. Systems Management

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

Management as a profession

 Just as Medical Colleges, IITs and NITs IIMs are set

up for formalized education and training on
Management. Apart from IIMs, university
departments, popular private B-Schools and
thousands of institutes also provide management
education

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

Management as a profession

 There is ICWAI for cost accountants

ICMA for management accountants
IMA for doctors
Bar Association for Advocates
AIMA for Management professionals
KMA for Kerala Management professionals

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

 MANAGEMENT AND ADMINISTRATION
Both these terms are used synonymously. But
Management and


administration

there exists some difference. Different view

points in this regard are as follows.
1. Administration is a higher level function and
management is a lower level function
2. Management is a generic term which includes
administration.
3. Management and administration are synonymous.

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

 American authors like Oliver Sheldon, William
Management and


administration

Newman, Ordway, Teed, etc. Are of the first opinion.

Administration is on one hand is determinative and
management is executive functions.
 British authors like Brech, Kimball and Kimball
believes in the second view.
 Third view is the modern view expressed by Henry
Fayol. He doesn’t make any distinction between both.

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

Management and

Administration Board of directors

administration

Chief executive

General manager

Management Superintendent

Supervisor

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

 LEVELS OF MANAGEMENT
Management levels

Top management
Board of directors,
chief executive
Departmental
Middle
heads,
management
Branch managers
Supervisors,
Lower
superintendents (supervisory level
Section officers management)

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

  Top management
 It includes Board of Directors,
CEO/Chairman/President/Managing Director
Management levels

 Common functions of this level are

 Lays down the overall long term objectives of the organization
 Framing broad policies and strategic plans

 Organize the departments and appoint department heads

 Provide direction and leadership to the organization as a whole.

 Co-ordinates and controls the activities of different departments.

 Maintain liaison with government, workers, organizations and

other outside groups.

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

  Middle management.
 Heads of various departments, e.g. HR Manager, Finance
Manager, Marketing Head etc. Come under this department.
 Main functions of this level are
Implement the policy decisions taken by the top
Management levels

management.
 Transmit orders and issue detailed instructions
to the lower level management.
 Communicate the problems and suggestions of
supervisory management upwards.
 Plan the activities of various work units within
the same department.
 Serve as a link between top management and
lower management.
 Take departmental decisions.

 Guide and encourage lower level managers to

attain the overall objectives of the organization.

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

  Lower level management
 Known as supervisory or operative management. This level
consists of foremen, supervisors, accounts officers, sales
officers etc. Major functions of this level are
Management levels

Planning daily works

Work assignment and issue of orders and
instructions
Arranging materials, machinery, tools etc.

Work supervision and guidance.

Worker relationship and maintenance of

discipline and result

Performance evaluation

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

FUNCTIONS OF A MANAGER Functions of a manager
Planning
 Setting objectives
 Determining how they’ll
be met

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Functions of a manager

 Organizing

 Delegating and
coordinating tasks
 Allocating resources

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

FUNCTIONS OF A MANAGER

 Leading
 Influencing employees to
achieve objectives

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

Functions of a manager

 Controlling

Establishing mechanisms
to make sure objectives
are met
Implementing mechanisms
to make sure objectives
are met

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

Roles of managers Roles of a manager

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

 Interpersonal roles
Roles of managers


 Figurehead : This role refers to duties of ceremonial
nature. Such as greeting the touring dignitaries, attending
the wedding of company staff, inviting an important
customer for lunch etc.
 Leader: As a leader, manager has to motivate and
encourage his subordinates. He is supposed to reconcile
their individual needs with organizational goals.
 Liaison: He is the one to keep in touch with the outsiders
to collect information useful for his organization.

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 Informational roles
Roles of managers


 Monitor: Monitoring refers to keep vigilance on the
external and internal business environment so as to collect
unsolicited information that can be used as important
inputs in business decisions.
 Disseminator: In this role, the manager passes valuable
information to his subordinates.
 Spokesman: A manager nowadays has to represent the
organization before various external groups who have some
stake in the business. E.g. Government, Trade Unions,
competitors, suppliers etc.

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

 Decisional roles
 Entrepreneur: As an entrepreneur, he must try to
adopt innovations in the business. Novel ideas are
essential for successful business.
 Disturbance handler: In this role, unexpected
problems affecting operations have to be dealt with
appropriate solutions. Whomever it is related.
 Resource allocator: Manager has a decisional role in
allocating organizational resources.
 Negotiator: It means to reach in an agreement with
suppliers, labor unions etc.

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES
Chapter

2
Development of Management
Thought

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

EVOLUTION OF MANAGEMENT THOUGHT

Early-
classical
approaches

Neo-
Modern classical
approach approach
es

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

EARLY CLASSICAL APPROACHES
Scientific management
F.W Taylor (1856-1915)

Administrative management
Henri Fayol (1841-1925)

Bureaucracy
Max Weber (1864-1920)

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

 SCIENTIFIC MANAGEMENT
 Frederick Winslow Taylor is
considered as the “Father of scientific
management”. During his career
spanning 26 years in different
companies like Midvale Steel, Simonds
Rolling Machine and Bethlehem Steel.
When he was serving as a Chief
Engineer of Midvale Steel Company,
Taylor made many contributions to
the field of Management.

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

TAYLOR’S CONTRIBUTIONS
 Time & motion study: Time study is clearly observing
the work of employees with the help of a stop watch to
know the time taken to complete a task. Motion study
is watching the activities and body posture of
employees simultaneously with time study.
 Differential Payment: It is a system of wage payment
under which the high performers are paid higher than
low performers.

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

 Drastic reorganization of supervision: Taylor’s major
suggestions in connection with supervision are
 Separation of planning and doing &
 Functional foremanship.

 Scientific recruitment and training.

 Intimate friendly cooperation between management
and workers
 “a complete mental revolution” on the part of management
and workers.

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES
ADMINISTRATIVE MANAGEMENT
 Henry Fayol is known as
“Father of General
Management”. He was a
French mining engineer ,
leading industrialist and a
successful manager. His
theories focus on the
development of broad
administration which are
applicable to general and
higher managerial levels.

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

 FAYOL’S CONTRIBUTIONS

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AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES
BUREAUCRACY
 Max Weber, a German sociologist,
is known as the Father of
Bureaucracy. His study on different
types of government and business
organizations distinguished 3 types
of administration.
 Leader oriented
 Tradition oriented &
 bureaucratic

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

NEO-CLASSICAL APPROACHES

Human Relations
Movement

Behavioural Approach

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HUMAN RELATIONS MOVEMENT
The classical approaches of Scientific Management and
administrative management was found insufficient in
achieving complete efficiency in production efficiency.
Because those concepts dealt more with the material
side of organizations. So there was an increased need
of a more people oriented concept. This gave rise to
Human Relations Movement. The proponents did not
deny classical approaches but made some additions.

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HAWTHORNE EXPERIMENT
The study was undertaken by Prof. Elton Mayo and
his colleagues at Western Electric Company’s
plant in Cicero, Illinois from 1927 to 1932.
around 29000 employees worked in the company
which manufactured telephone accessories and
equipments. The whole study can be four phases
as follows.
 Illumination experiments
 Relay assembly test room
 Interviewing program
 Bank wiring test room

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

 Illumination Experiments: The first phase in the
study. Researchers checked the correlation
between illumination and productivity on a group
of workers. But the results were not clear. Again
they were classified into control group and test
group under which the former was given constant
light and latter with changing levels of
illumination. It was found that illumination
affected production only marginally.

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

 Relay assembly test room: The object of this study was
broader than the former. It considered the facts such
as length of the working day, rest pauses and other
physical conditions. 6 women were tested in an
informal atmosphere with a supervisor- researcher in
a separate room. Surprisingly, the researchers found
that there was no relation between production and
working conditions. This phenomenon according to the
researchers was due to
 The feeling that they are the part of a research.
 Warm informality, small group, tension free interpersonal
and social relations, freedom etc
 High group cohesion among girls.

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

 Interviewing program: The dilemma faced by
researchers in the first and second phase,
prompted them to interview more than 20000
workers. Direct questions were asked in the first
stage, then non directive questions in the second
stage where they were free to talk. Type of
supervision, working conditions, living conditions
etc. The study proved that the workers’ social
relations inside the organization is an influencing
factor on their attitudes and behaviour.

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

 Bank wiring room experiment: This is the last
phase of experiment. It involved in-depth
observation 14 men who were manufacturing
terminal banks of telephone wiring assemblies, to
find out the effect of informal group norms and
formal economic incentives on production
efficiency. The study revealed following fact.
 Informal groups play a vital role in organizations.

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

BEHAVIOURAL APPROACH
 These include improvements and additions to the
previous approach. Douglas McGregor, Abraham
Maslow, Kurt Lewin, Mary Parker Follet,
Chester Bernard etc. Are some of the popular
behavioural scientists. They were experts in
various social sciences such as psychology,
sociology and anthropology and used scientific
and sophisticated research methods. They are
regarded as behavioural scientists.

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

Behavioural Approach can be summerized as follows.
 Those scientists criticized the classical organization
structure due to its hierarchical structure in which the
manager dominates and subordinate depends.
 The approach argues for participative decision making
for making the problem solving more easy.
 They underline employees’ role in control process such
as establishment of standards and measurement, and
emphasize the need of prompt feedback.
 The approach throws light to various leadership
models and suggests democratic-participative model
 They consider human being as “complex”.

 They recognize conflicts and suggest healthy

negotiation

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MODERN APPROACHES
 Quantitative approach: It is concerned with
building mathematical models of problems to
solve them easily. The science for this purpose is
known as Operations Research(OR) or
Management Science.
 Systems approach: It is an integrated approach
towards management problems. To avoid the
pitfall of an approach, different schools of
thought are combined in systems approach.
Chester Bernard, George Homans, Philip
Selznick and Herbert Simon are some of the
advocates of this approach.

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

 Contingency Approach: This approach state that
those schools of thought have no general and
universal applicability and hence managers
should try to develop a situational sensitive
model towards solving problems.

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

Chapter

3 PLANNING
Planning

Nature and types of planning

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PLANNING- DEFINITION
According to Koontz and O'Donnell “Planning is
deciding in advance, what to do, how to do it,
when to do it and who is to do it.”
Its features are followed
 Planning is an intellectual process

 Planning is goal-oriented

 Primacy of planning

 Planning is pervasive

 Planning is continuous

 Planning is futuristic

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PLANNING-IMPORTANCE

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STEPS IN PLANNING
Establishing objectives
Developing the planning premises
Reviewing of key factors
Development of alternatives
Evaluation of alternatives
Selection of the best course of action
Formulation of derivative plans
Implementation of plans follow-up

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TYPES OF PLANS
Vision

Mission

Objectives

Strategie
s
Operational
Plans
For non-repetitive activities, For repetitive activities, Standing
Single use plans (programmes and plans (Policies, procedures,
budgets) methods and rules)

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

1. VISION
 According to El Namaki: vision is “mental
perception of the kind of environment an
individual, or an organization, aspires to create
within a broad time horizon and the underlying
conditions for the actualization of this
perception”
 Vision of TISCO

We aspire to be the global steel industry

benchmark for Value Creation and
Corporate Citizenship

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2. MISSION
 Mission is the unique aim of an organization that
sets it apart from others of its type. It states the
organization’s scope of business. It may also
mention the cultural values

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MISSION OF TISCO
 Consistent with the vision and values of the founder
Jamsetji Tata, Tata Steel strives to strengthen India’s
industrial base through the effective utilization of
staff and materials. The means envisaged to achieve
this are high technology and productivity, consistent
with modern management practices.
 Tata Steel recognizes that while honesty and
integrity are the essential ingredients of a strong and
stable enterprise, profitability provides the main
spark for economic activity.
 Overall, the Company seeks to scale the heights of
excellence in all that it does in an atmosphere free
from fear, and thereby reaffirms its faith in
democratic values.

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3. OBJECTIVES
 They are the goals or aims that the management
wishes the organization to achieve in pursuit of
its mission. Objectives are the specific targets of
an organization.

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CHARACTERISTICS OF OBJECTIVES
 Objectives are multiple in number
 Objectives may be quantifiable or unquantifiable.

 Objectives are generally arranged in a hierarchy.

 Objectives sometimes clash with each other

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ESSENTIALS OF SOUND OBJECTIVES
 Objectives must be both clear and acceptable.
 Objective must support one another

 It must be precise and measurable

 Objectives should always remain valid.

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4. STRATEGIES
 Strategies are broad plans which makes the
organization environment sensitive. Just with
mere objectives, no organization can sustain in
the market. It has to respond quickly to
environmental SWOT.

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5.OPERATIONAL PLANS
A. Standing plans: Plans which are designed for
situations that repeat often. E.g. The plan for loan
processing of a bank. Major types are Policies,
procedures, methods and rules.

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

5.A.1.POLICIES
 “policy is a verbal, written or implied overall
guide, setting up boundaries that supply the
general limits and direction in which managerial
action will take place” George R Terry.
 They are the general guidelines for action
 It channelizes the thinking of the members
 They provide a framework within which the decisions
are made.

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5.A.1.I. TYPES OF POLICIES

 Classification on the basis of sources.

 Originated policies
 Appealed policies
 Implied policies
 Externally imposed policies

 Classification on the basis of functions

 Marketing policies, HR policies, Finance policies,
Production policies etc.

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 5.A.2. PROCEDURES
 A procedure provides a detailed set of instructions for
performing a sequence of actions involved in doing a certain
piece of work. E.g. The purchase procedure may be
1. Purchase requisition from store keeper
2. Exploring the sources of supply and choosing the supplier
3. Purchase order.
4. Receiving and inspecting of materials.
5. Checking and passing of bills for payment.

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

5.A.3. METHODS
 It is a prescribed way in which one step of a
procedure is to be performed. E.g. The method of
training to be imparted to staff. On the job, off
the job etc.

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

5.A.4. RULES

 The detailed and recorded instructions which a

specific action must or must not be performed in a
given situation. They make sure that a job is done in
the same manner every time, bringing uniformity in
efforts and results. E.g. In a Workstation the rules are
as follows.
 Inverter should be switched on always
 Air conditioner has to work to ensure there is no over
heating in the CPU.
 There should be measures to minimize dangers of fire or
short circuit.
 Tools and repair pack should be readily available for easy
trouble shoot and solutions for problems with LAN

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

5.B. SINGLE USE PLANS
 They are developed for a specific action. Such
plans are dissolved when it is achieved. Programs
and Budgets are of these types.

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

5.B.1. PROGRAMMES
 Programmes are framed as a combination of
policies, procedures, budgets etc. They are the
plans which intend at specific objectives for a
specific period of time.
 E.G. KSRTC’s Save oil save KSRTC program

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

5.B.2 BUDGETS
 A budget is a statement of expected income and
expenditure for a specific period expressed
quantitatively. E.g. Production Budget, Sales
Budget, Purchase Budget Etc.

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

Chapter

4 ORGANIZING
Meaning and process
Organizational structure

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

ORGANIZATION- DEFINITION
“Organization is a structural relationship by
which an enterprise is bound together and the
framework in which individual effort is
coordinated.”- Koontz and O Donnell
The term is derived from the word organism which
means a structure with various parts.

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

PROCESS OF ORGANIZING

1. Consideration of objectives:
Management writers such as Alfred D.
Chandler refer to organization as one in
which “structure follows strategy”.

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

2. Deciding Organizational
Boundaries:
• This step decides what to do inside and what
outside the organization. It includes activities
like
• manufacture-versus-buy choice.
• strategic alliance with other firms.
• extent of organization’s interaction with
outside environment.

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

3. Grouping of activities into departments

Grouping means to unite all closely related activities into departments

and sections. For example the production activities of a Biscuit
Manufacturing Unit can be grouped as under

• flour mixing
• shaping
• heating
• QC
• Packing
• Loading

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

4. Deciding the key
Departments
• Departments rendering key activities are
called key departments. Other departments
exist to serve them. It differs from one
enterprise to another.

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

5. Determining levels at which various
decisions are to be made.
• This step emphasizes on decisions. At
what level the various major and minor
decisions are to be made is to be
predetermined. The extent of
centralization and decentralization
deserves high importance in this step.

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

6. Determining the span of management.

• It refers to the number of subordinates who

should directly report to each executive. It
should be decided after taking many factors
into consideration

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

7. Setting up the coordination
Mechanism
• After careful differentiation, all the
activities have to be effectively integrated.
As individuals and departments carry out
their specialized activities, it is essential to
achieve overall goals and to set apart
conflicts.

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

SPAN OF MANAGEMENT
Span of management is also referred to as
 Span of control

 Span of supervision

 Span of authority

 Span of responsibility

It is the number of subordinates who report

directly to a manager.

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES
IMPORTANCE OF SPAN OF MANAGEMENT
 It influences the efficient utilization of managers
 It has high effect on subordinates’ performance.

 Span of management and organization structure

is related.

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

FACTORS GOVERNING SPAN OF
MANAGEMENT

 Ability of the manager.

 Ability of the employees.

 Type of work.

 Well defined authority and responsibility.

 Geographic location.

 Sophisticated information and control system.

 Levels of management.

 Economic considerations.

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

DEPARTMENTALIZATION

Differentiation of activities into various

segments is called departmentalization. There
are different bases for departmentalization. An
organization may choose it as per the
convenience.

Most bases fall into one of the following

• Process departmentalization and

• Purpose departmentalization

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

PROCESS DEPARTMENTALIZATION

Business or Organizational Functions

Major functions of an organization is

grouped into a department. For
example, Production Department,
Marketing Department, Finance
Department etc.

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

Advantages
• It is a simple form of grouping activities for small
organizations which are engaged in manufacturing only one
or two or limited number of similar products or render
services.
• It helps in excellence in performance as the work force can
expertise in limited range of skills.
• It enables economies of scale because all products are
produced in a single plan instead of many units.

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

Disadvantages
• It promotes sub-goal loyalties
• It quells managers’ expertise into a single
department.
• It is usually unsuitable for large and complex
organizations.
• Procedures will be over complicated in this
type of organizations.

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

Technology

Segregation is here done on the basis of

different process or technologies involved
in the manufacture of a product. For
example an enterprise involved in the
production of vegetable oil may have
separate departments for crushing,
refining and finishing. A textile mill may
have ginning, spinning, weaving, dying
and printing departments.

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

Advantages
• Heavy and costly equipment is used efficiently
• Principle of specialization is seen here.
• Most suitable for products which pass through various
processes.

Disadvantages
• Workers feel less responsible for whole product
• Lack of good development opportunities
• A breakdown in a department slows down the others.

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

PURPOSE DEPARTMENTALIZATION

Products
• There will be a separate department
for each major product which is put
under the charge of a manager. Within
each department, manufacturing,
engineering, marketing, manpower
and other facilities are assembled.
• E.g. Unilever (Manufacturing
detergents, toiletries, chemicals and
agro based products)
AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES
Advantages
• Continuous and undivided attention on product.
• Interdepartmental comparison is possible for enabling
the top management to invest appropriately.
• The product head is better motivated.
• Control and evaluation is more easy.
Disadvantages
• There is duplication of staff and sales.
• If not coordinated properly, the department may drift
from organizational goal.

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

 Customers
• Here, the departments are divided on the basis
of customers. E.g.
• An electronics manufacturer –military,
industrial and consumers
• An automobile servicing entity – cars, heavy
vehicles and scooters
• An educational institution – day, evening, and
correspondence courses.
• Major customers can be given proper attention
in this structure.
• There may be duplication of facilities
AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES
 Regions, territory or Location
• Division is done on the basis of geographic
parameters here. E.g. Indian Railways
• Advantages
• It motivates each regional head to achieve higher
• Local situations can be considered by regional
head
• It makes the local resources available.
• Disadvantages
• Duplication of activities
• Promotes short run competition and forgets
overall interest among regions
AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES
 Division
• Large and multi-product companies segment
themselves into different independent profit centres.
These centres are called divisions. Though general
company-wide policies are applied, each department
head enjoys free operations.
• Leading engineering company in India, L&T has
separate divisions for Infra structure, Metallurgical,
Heavy Equipments etc.

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

 Time
• Grouping of activities is here done on the basis of timing of
their performance. Many production concerns adopt it.
There may be day, night shifts in such organizations.

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

 Combined base
 Some organizations use different bases for
departmentalization.

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

TEAMS
It is a small group of men with various
backgrounds, skills, knowledge and abilities who
are selected from different functional areas of the
organization to work as a team for achieving a
defined task. One among them will be the team
leader. The team leader should posses complete
knowledge about the members of the team. E.g. A
group of doctors and nurses with different
specialization treating a patient, The sound
engineering team of an event, a police
investigation team probing a case.

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

Chapter

5 COORDINATION
Meaning & Definition
Need for coordination

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

COORDINATION- MEANING & DEFINITION
 To coordinate means to unite the diversity. It
emphasizes on the integration mechanism of
interdependent work situations so that the
organizational goals are achieved. Some experts
consider it as a separate managerial function, but
the activities can be well coordinated if different
managers perform the coordination function
simultaneously with their main functions.

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES
DEFINITION
Henry Fayol

“It harmonises, synchronises and unifies individual

efforts for better action and for the betterment of
business objectives”

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

NEED FOR COORDINATION

 Division of labour
The need for coordination increases along with
the extent of division. The greater the division, the
greater the coordination. Differentiation creates
convenience to the differentiated and coordination
ensures convenience to the differentiators.

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

 Interdependence of units
 Pooled interdependence: Organizations that make
contribution to the total but are not directly related can be
called so. E.g. Two Manufacturing plants of the same
enterprise. The coordination between them is minimum
since the interdependence is low.
 Sequential interdependence: Here, one organizational unit
acts after the other. E.g. Marketing department will be
deactivated if production department stops production.
Greater coordination is needed in such type of operations.

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

 Reciprocal Interdependence: Here, there is exchange of
services and materials between two departments of a
company. E.g. Maintenance department and Production
department. Ones service is the input for the latter and the
latter’s input is the out put of the first.

Maintenan
Production Machines requiring ce
department maintenance
departmen
t

Post maintenance machines

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

 Individual interest versus organizational
interests
 Coordination has to reconcile differences in approach
between individuals and organization
 The departments and individuals should have an
appropriate knowledge on general policies and
procedures.

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

FORMALIZATION
 Formalization is the degree to which
organizations standardize behaviour through
rules, procedures, similar training, and other
methods. E.g. A MNE like Mc Donald’s
corporation standardizes its product at all the
sales outlets all over the world.
 Problems of formalization
 It reduces organizational flexibility and give no way
for customized responses
 Some works become so convoluted
 When everything in organization is formalized, it
affects the sensitivity of men.

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

 DELEGATION OF AUTHORITY,
Chapter CENTRALIZATION AND
6 DECENTRALIZATION
Authority and responsibility
Line, staff and functional authority

Delegation of authority

Centralization and decentralization

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

AUTHORITY

 It is the formal right of the superior to command

and force his subordinates to do a certain thing.
Henry fayol defines it as “ the right to give orders
and power to exact obedience”. The authority is
exercised through
 Power
 Influence and
 Leadership

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

POWER

 Power is the ability of a person to influence

another person to perform an act or to change his
behaviour. According to French and Raven, there
may be five types of power in an individual. They
are reward, coercion, referent, expert and
legitimate.

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

INFLUENCE
 The major types of power such as coercion and
reward may not always work. The superior uses
his influential capacities in those circumstances
through expert power, charismatic power etc.
Influence is accepted voluntarily or unconsciously
by the employees for respect to the manager.
Some of the other ways of influencing an
employee are
 By giving him a prestigious designation,
remuneration and other benefits.
 By passing all important information via him.
 By supporting his decisions.
 By consulting him for opinions on important matters.

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

RESPONSIBILITY
 Responsibility may be
 Operating responsibility or
 Ultimate responsibility

 The first is the obligation of a subordinate to obey

the commands of his superior.
 Ultimate responsibility is always retained by the
superior. If the subordinate fails to perform the
job(operating responsibility) superior is held
responsible for the same.

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

AUTHORITY AND RESPONSIBILITY
 There should be parity between authority and
responsibility. The subordinate is responsible for
only those which he is authorized.
 Management experts advocate that authority and
responsibility should be exactly explained.
 There will be misuse of authority if it is more
than responsibility on one hand and there will be
ambiguity over the assignments if responsibility
is more than authority on the other hand.

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

LINE, STAFF AND FUNCTIONAL AUTHORITY

Line authority

In line authority, direct command is

exercised by the superior over the
subordinates. This type of authority can be
plotted by the standard chain of authority
which begins with the board of directors
and ends with the casual workers by
passing various levels in the hierarchy.

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

Line and staff authority

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

Staff authority
 Staff refer to the supportive officers to line
superiors. Their authority is merely advisory.
Their ideas will be given to the line managers for
confirmation. Final decision will be taken by
them. E.g. Advertisement team’s suggestions will
be put forward to the marketing head for
discussion and approval. There are four levels of
authority of a staff man as shown in the picture.

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

Highest Voluntary is the lowest level
where the consultation is only
optional. The line head may or
Functional
authority may not consult him.
At the next level consultation
Concurring is made compulsory. He cant be
authority ignored by the line managers.
At the concurring authority ,
Compulsory
consultation no action can be taken without
his agreement.
Voluntary
Functional authority means
consultation direct orders can be given to
people in other departments
outside his formal chain of
lowest
command.

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

DELEGATION OF AUTHORITY
 The managers can never do all the required tasks
for the achievement of organizational objectives.
They should not be plunged with lesser
important decisions. Therefore, some part of their
work is assigned to the subordinates with
necessary authority to take decisions. This is
known as delegation of authority. Louis A. Allen
says on delegation “If the manager requires his
subordinates to perform work, he must entrust
him with part of the rights and powers which he
otherwise would have to exercise himself to get
the work done”.

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

 Advantages of effective delegation
 It relieves the manager from heavy work load
 It enables better and speed decisions
 It helps in getting experience to subordinates
and builds morale.
 It creates a formal structure.

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

 Barriers to effective delegation
 Fear of loss of power
 “I can do it better myself Fallacy”
 Lack of confidence in subordinates
 Fear of being exposed
 Difficulty in briefing
 Lack of proper control

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

CENTRALIZATION AND DECENTRALIZATION
Centralization means that formal decision making
authority is held by a small group of people,
typically those at the top of the organizational
hierarchy.
To decentralize is to disperse decision authority
and power throughout the organization. The level
of centralization and decentralization depends
upon many factors.

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

 Some of the Factors affecting the level of
centralization and decentralization are as
follows
 Organizational size
 Technology
 External environment
 Organizational strategy

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

Chapter

7 DIRECTING
ELEMENTS OF DIRECTION
SUPERVISION
MOTIVATION
LEADERSHIP
COMMUNICATION

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

DIRECTION- MEANING AND DEFINITION

Direction is an important managerial function

which stimulates action. For an organization,
mere planning, organizing and staffing will not
make it active. To direct means to supervise, to
motivate, to lead with effective communication to
subordinates for the achievement of
organizational objectives.
To Koontz and O’ Donnell, “direction is the
interpersonal aspect of managing by which
subordinates are led to understand and
contribute effectively and efficiently to the
attainment of enterprise objectives”

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES
SUPERVISION

 Viteles

Supervision refers to the direct and

immediate guidance and control of
subordinates in performance of their
task

 Cambridge English Dictionary defines it as “the ​act

of ​watching a ​person or ​activity and making ​certain
that everything is done ​correctly, ​safely, etc.:”

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

 Importance of supervision
 Initiates action
 Enables proper control
 Helps in reducing wastages
 Ensures discipline
 Provides feedback
 Facilitates motivation

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

 Functions of a supervisor
1. To decide job assignments to each member
2. Issue orders and provide direction to employees
regarding the assignment
3. Ensure the following of rules and regulations
4. Accept grievances and solve conflicts
5. To make sure that employees are working in proper
working conditions
6. To impart technical knowledge and guidance to
employees
7. To share appropriate matters to the top
management
8. To brief management policies to workers
9. Performance evaluation, recommendation of
promotion and transfers and assessment of training
requirements
10. To keep a smooth relationship with employees.

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

MOTIVATION

 Motivation is an important factor which

determines the ways and ends of
someone’s action. It deserves much
consideration in an organizational
context.
 David Myers (1996: 297) defines
motivation as “a need or desire that
serves to energize behavior and to
direct it towards a goal.”

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

NATURE OF MOTIVATION
1. Individuals differ in their motives
 Motives are complex
 All may not react to a single strategy
 Each individual has to be dealt with appropriately
2. Sometimes the individual himself is unaware of his
motive.
3. Motives change.
 Motives are not fixed, it changes from time to time
4. Motives are expressed differently
 The way of action differs from one to another.
5. Multiple motives make the choice of goals difficult for an
individual
 Approach-approach conflict
 Avoidance-avoidance conflict
 Approach-avoidance conflict

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

THEORIES OF MOTIVATION
 Content theories
 Explains what motivates an individual. Focuses on
various needs and incentives which cause behaviour.
 Important content theories are
 Abraham Maslow’s Need Hierarchy Theory
 Clayton Paul Alderfer’s ERG Theory
 Herzberg’s Two Factor Theory
 McClelland’s Achievement Theory
 Process theories
 They answer the way how behaviour is caused
 Important process theories are
 Victor Vroom’s Expectancy Theory
 Adam’s Equity Theory
 Reinforcement theory
 It has its emphasize on behaviour modification
 Skinner’s Behaviour Modification Theory
AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES
AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES
Physiological needs: These are the needs
which are essential for the survival of human
life. E.g. The need for food, water, air etc.

Security needs: It involves economic security

and psychological security.

Social needs: These needs emphasize on

acceptance by the society and association with
others; to love and to be loved. Each every
human beings’ desire to be with a group is
pointed by Maslow through social needs.
AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES
Esteem needs: These are needs which relate to
respect and prestige. Esteem needs include the
feeling of a man inside himself that he is worthy and
the feeling that others think he is worthy.

Self fulfilment needs: This need is also called as self

actualization or self realization. It means the need
for accomplishing what an individual is capable to
do. E.g. One who is interested in Medicine becomes a
doctor. A man with a passion to become a
businessman makes profit through business.

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

ALDERFER’S ERG THEORY
 Alderfer made some modifications in the
Maslow’s need hierarchy theory. His model
reduces need categories into three.
 Maslow’s theory represents a static needs
hierarchy whose pinnacle is fulfilment, but
Alderfer’s theory offers a flexible, three-needs
system.

Existence Relatedness Growth

Safety and
Self actualization
physiological Social needs needs
needs

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

HERZBERG’S TWO FACTOR THEORY
 This is the most popular theory of work motivation. Two
hundred engineers and accountants were interviewed
by Frederick Herzberg and his associates. They were
asked to tell about the times they felt bad and good at
their work. The two factors are
 Maintenance factors or hygiene factors
 Motivators or satisfiers

 The former factors are necessary to avoid

dissatisfaction and subsequent problems such as
absenteeism, turnover and grievances. But these don’t
produce high level of motivation. The latter leads to
higher levels of motivation and its absence leads the
workers to strong dissatisfaction

AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES

Maintenance or hygiene
factors
 Fair company policies and
administration
 A supervisor who knows
the work
 A good relationship with
one’s supervisor
 A good relationship with
one’s peers
 A good relationship with
one’s peers
 A good relationship with
one’s subordinates
 A fair salary
 Job security
 Personal life
 Good working conditions
 Status
AP SHAREEF’S LECTURE ON MANAGEMENT PRINCIPLES
Motivators or satisfiers
 Opportunity to
accomplish something
significant
 Recognition for
significant
accomplishments
 Chance for
advancement
 Opportunity to grow
and develop on the job
 Chance for increased
responsibility
 The job itself