Introduction of MANAGEMENT

Introduction
Management is an important element in every
organization.

It is the element that coordinates currents

organizational activities and plans for the
future.

The management adapts the organization to its

environment and shapes the organization to
make it more suitable to the organization.
Definition
“Management is the art of “knowing what you
want to do” and then seeing that it is done in the
best and cheapest way.
……F.W.Taylor

Management as a process “consisting of

planning, organizing, actuating and controlling,
performed to determine and accomplish the
objective by the use of people and resources.”
……George R. Terry
 George R. Terry defines in his opinion
 Planning means Plan in advance.
 Organizing means coordination between
human resources and material resources.
Actuating means motivation and giving
direction to subordinate.
Controlling means to ensure about
implementation of plan without deviation.

Thus this definition tells that

management is act of achieving the
organization objectives.
 Management functions in different author
Newman & Summer:
* Planning
* Organizing
* Leading &
* Controlling

Henry Fayol :
 Planning
 Organizing
 Commanding
 Coordinating and
 Controlling
Luther Gulick : ‘POSDCORB’:
Planning, Organizing, Staffing,
Directing, Coordinating, Reporting &
Budgeting

Warren Haynes & Joseph Massie

Decision Making, Organizing,

Staffing, Planning, Controlling,
Communicating & Directing

Koontz O’Donnell
Planning, Organizing, staffing, directing
& Controlling
Planning
LEVELS OF MANAGEMENT
Evolution of Management Thought
 Stages in evolution of management
Stage I : Period of Management
Awakening
Stage II : Scientific Management
Stage III : Human Relation Period
Stage IV : Modern Management Period
Awakening
Industrial Revolution brought large
growth , development and diversification business
enterprises.

Transition to Machinery : Muscle power converted into

machine power.

Increased Demand : No new products and innovative

services led to increases in the demand from consumers.

Rapid Commercialization : there was a massive

increases in the number of business related industries.
 SCIENTIFIC MANAGEMENT
THEORY
Frederick W. Taylor & Henry Fayol’s devised the
body of principles known as scientific management
& Modern Management theory.
Taylor based his management system on production-
line time studies. Using time study as his base, he
broke each job down into its components and
designed the quickest and best methods of
performing each component.
 He also encouraged employers to pay more
productive workers at a higher rate than others,
using a "scientifically correct" rate that would
benefit both company and worker.
This system is called Differential Rate System

Gantt originated a charting system for production

scheduling.

Every worker's progress was rated publicly and

recorded on individual bar charts,--in black on days
the worker made the standard, in red when he or she
fell below it. Going beyond this.

 Fayol’s Contributed was more

enterprises oriented
 Taylor’s was more work oriented.
 limitations of scientific management theory
Taylor's system clearly meant that time was of
the essence. His critics objected to the "speed
up" conditions that placed undue pressures on
employees to perform at faster and faster levels.

The emphasis on productivity—and, by

extension, profitability—led some managers to
exploit both workers and customers. This
condition created mistrust / suspicious
relationship between labour and supervisor or
management.
 Henry Fayol Functions
 Planning
 Organizing
 Commanding
 Coordinating
 Controlling
While Studying Organisations Fayol spilt all organisational
works under six functions
Technical : For Production
Commercial : Buying and selling
Financial : Procuring capital
Security : For Protecting organizational resources
Accounting: For Maintaining Account Books
Managerial : For Planning and Controlling.
 Fayol’s 14 Principles of Management

1. Division of Labor 2. Authority

3. Discipline 4.Unity of
Command
5. Unity of Direction 6. Remuneration
7.Subordination of Individual Interest to
the Common Good
8. Centralization 9. The Hierarchy
10.Order 11. Equity
12. Stability of Staff 13. Initiative
14. Espirit de Corps
Advantages of Scientific
Management
Better earnings
 Increase in productivity
Better work conditions
Better decisions
Prompted research
Standardization
 Optimal resource utilization
Disadvantages of Scientific
Management
 Various functional department of an organized such a s
finance , marketing are ignored.
 It reduces works to automatic machine by taking away
from them the functions of thinking
By separating the functions of planning and thinking from
that of doing , scientific management reduces work to
mere routine.
Increase in specializations leads to a restriction in the
workers mobility and thus employability
Scientific management is only a way to speed up workers
without much regard for their health and well being.
 Stage III : Human Relation Period
This period emphasizes
on the understanding of various human factors that
contribute towards business and production issues.
Management thinkers and researchers study why
our beliefs, attitudes, behaviors sometimes cause
interpersonal conflicts in our personal lives and in
work related situations.
Various thoughts explained
a. Abraham Maslow’ Human Needs
b. Frederick Two factor Theory
c. Victor H. Vroom’s Expectancy Theory
Abraham Maslow’ Human Needs
Frederick Herzberg’s Two factor
Theory
 Victor H. Vroom’s Expectancy
Theory
The famous expectancy theory of
motivation was developed by victor vroom.
The theory explains that it
is a combination of efforts, performance, and
rewards which ensure that a worker will
contribute positively to an organization.
Stage IV : Modern Management
Period
 The key in Modern Management issues
were varied. Some of the issues that can be
identified are :
a. Managing Change
b. Developing pro – organizational
approach
c. Shared values in the organization
d. Creating Excellence
e. Empowering Employees……..so on.
DECISION MAKING PROCESS
DECISION MAKING PROCESS
Organizational Structure
 Organization Vs Organizing
Organizing :
1. A systematic arrangement of activities
2. Organizing is a function of management
3. To achieve the set targets and goals of an organization

Organization :
1. It is a entity which in a systematic manner and
managed
2. To achieve the goals that are planned on regular basis.
3. It is a social unit where the functions of management
are performed.
 Formal Vs Informal
Formal : To be formal when it is set up for a certain purpose,
governing it with certain rules and regulations.
Example : A manager calls his team members for a meeting at a
given time. The conducting of the meeting is called a formal .
Informal :
1.When a staff discuss their personal issues with their
managers or higher authorities.
2. An informal organization is bound by urges and
imaginations or likes or dislikes of employees
 Basic Terms of Organisation
Authority : the power to give commands and to use
it with judgment when you are in that specific
position
 Responsibility : The responsibility is on the
employee to complete the allotted work.
 Delegation of Authority : Its takes place from the
top level to the lower levels in an organization.
 Centralisation : To follow centralized authority
when the central office takes authority of decision
making
 Decentralization : when the power of decision
making lies with the regional offices.
 Span of Management : also known as Span of
control , Span of Supervision, Span of
Responsibility, represents the total number of
employees that can be managed effectively by the
manger at a certain point of time.
Factors Determining the Right Span :
a. Quality of Subordinates
b. Subordinates training
c. Nature of Work
d. Time required for Supervision.
Types of Span of Control:
1. Wide Span of Control
2. Narrow Span of Control
 Organizational Types
Organizations based on functions or activities of
departments are listed.
a. Product Organization
b. Geographical Organisation
c. Customer Organisation
d. Functional Organisation
e. Matrix Organisation
f. Committee Organisation.
 Organizations based on Correlation of
Authorities are listed.

a. Line Organisation
b. Line & Staff Organisation
c. Functional Organisation
d. Matrix Organisation
e. Committee Organisation.

These are all several overlaps in

the classification of organization.
 Product Organization

The department are based

on the products manufactures or services
rendered. It is common in case of
organizations specializing in different
products or service such as Manufacturing
, Financing, Wholesaling and so on…..
Merits :
1.It strengthens the manufacturing facilities
product wise.
2. It provides for growth and diversification
3. It ensures better customer care
4. All facilities are available under one roof
5. Responsibility can be fixed for sales and
profits for each product or service
6. Managers can be trained for seniors
positions.
Demerits :
1. Adequate number of qualified and
professional managers may not be
available.
2. Maintaining central service may not be
cost effective.
3. It tends to increase the problems of
control for top management.
4. The Organisation may get disintegrated
with increasing focus on department.
 Customer Organisation

All activities of the enterprises are grouped on

the basis of the profile of its customers. Each
group is managed by one department head.
Advantages :
a.It focus on the specific needs of individual
customers
b. It ensures better customer care
c.It develops a competitive advantage through
core competence.
d. It is based on growing and diversified
needs of customers
Disadvantages :
a. It calls for focused training programmers
to cater to the specific customer needs
b. It may be very costly
c. Frequent changes in the market
conditions may render under utilization
of services
d. It may be difficult to specifies in the
customer problems if the customer group
is small.
 Organizations based on Correlation of
Authorities are listed.
Line Organisation :
Line organization business
or industry structure with self-contained
departments. Authority travels downwards from top
and accountability upwards from bottom along the
chain of command, and each department manager
has control over his or her department's affairs and
employees.
Advantages :
a. Its sets clearly the direct lines of authority and
responsibility of a line manager.
b. It is simple to understand
c. Each section or department can be treated as a
unit for control purpose.
d. It is flexible.
e. It facilities quick decision and prompt actions.
Disadvantages :
a.It is likely that the line manager is
overburdened with all tasks relating to a
particular section or department.
department
b. There is no scope for specialization
c. There is more scope for favoritism.
favoritism
d. It may lead to low morale in the
organization.
Line & Staff Organisation
Example : 1
Advantages :
a. It enhance the quality of decision
b. There is a grater scope for advancement
c. It relieves the line managers
d. It is mostly beneficial where there is a line of command
within staff department, as in the case of the Armed
Forces.
Disadvantages :
a.It may create more friction or conflict between line
& Staff
b. Staff Suggestions are implemented difficult
c. It is expensive to have both staff and line
managers.
 Functional Organisation
FW Taylor suggested functional
organization in his theory of scientific
management in support of his “one best
way” of doing things.

One foreman was observed was

overburdened with all the operations such as
task setting, time recording, quality
inspection, disciplinary jobs and so on…..
He divided his job into 8 functional
foreman….
Eight Jobs of Foreman :
1.Route clerk : Identifies the route for the material to pass on.
2.Instruction clerk : Gives instructions to the workers about what
to do and what not
3. Time and cost clerk : Identifies the time & cost for each job
4. Shop Disciplinarian : maintain the discipline on the shop floor
5. Gang Boss : Assembles the Machinery needed for the worker
6. Speed Boss : Standardize and sets the speed of the machine
7. Repair Boss : Repairs the Machinery in case of Breakdown
8. Quality Inspector : Responsible for the matters relating to
quality.
Advantages :
a.Planned Specialization
b. Separates activities related to planning and
control
c. Facilities large scale production through
standardization
d. The disciplinary control are well defined
e. Appropriate when there is a single product
or service
f. Offers clear career paths for functional
specialists.
Disadvantages :
a.Ineffective controls as workers have more
than one boss
b. Very costly
c. Calls for more coordination
d. Less appropriate when an organization
diversifies
e. No clear line of authority.
 Matrix Organisation
It is a combination of all
relationships in the organization , Vertical ,
Horizontal and diagonal.
It is mostly used in complex projects. It
provides a high degree of operational
freedom flexibility and adaptability for both
the line and the staff managers in
performing their respective roles.
Advantages :
a.It offers operational freedom and flexibility
b. It seeks to optimize the utilization of
resources
c. It focuses on end results
d.It maintain professional identity
e. It holds an employee responsible for
management of resources.
Disadvantages :
a.It calls for greater degree of
coordination
b. It violates unity of command principle
c. It may be difficult to define authority
and responsibility precisely
d. Employees may find it frustrating to
work with two bosses
 Committee Organisation

A committee is formed when

two or more persons are appointed to work
as a team to arrive at a decision on the
matters referred to it.

It is intended to utilize the knowledge ,

skills, and experience of all the concerned
parties.
Thank You