Mba PPM3

R.C.
Patel Institute Of
Pharmaceutical Education &
Research (RCPIPER)
RCPIPER’s MBA (Pharmaceutical Management): Excellence in applied pedagogy & probity. शुद्ध -श्रेष्ठ- अनुप्रयोगेन अध्यापनं, शिक्षाशास्त्रम्
OUTLINE
• Who are managers?
• What is management?
• What do managers do?
• What are the challenges of managing?
• Why study management?
• Submitting class exercises
Who Are Managers?
• Manager
• Someone who works with and through other
people by coordinating their work activities in
order to accomplish organizational goals
(Robbins, et. Al, 2006, p. 7)
Types of Managers
Exhibit 1.2 Managerial Levels
Top
Top
Managers
Managers
Middle Managers
Middle Managers
First-Line Managers
First-Line Managers
Nonmanagerial Employees
Nonmanagerial Employees
RCPIPER’s MBA (Pharmaceutical Management): Excellence in applied pedagogy & probity. शुद्ध -श्रेष्ठ- अनुप्रयोगेन अध्यापनं, शिक्षाशास्त्रम् 4
What Is Management?
• Managerial Concerns
• Efficiency
• “Doing things right”
• Getting the most
output for the least
input
• Effectiveness
• “Doing the right things”
• Work activities that
attain organizational
goals
What Do Managers Do?
Three Approaches to describe:
• Management Functions
• Management Roles (Mintzberg)
• Management Skills
Exhibit 1.4 Management Functions
Planning Organizing Leading Controlling

Lead to
Defining goals, Determining Directing and Monitoring
establishing what needs motivating all activities Achieving the
strategy, and to be done, involved parties to ensure organization’s
developing how it will and resolving that they are stated
sub-plans to be done, and conflicts accomplished purpose
coordinate who is to do it as planned
activities
What Do Managers Do? (cont’d)
• Mintzberg’s Management Roles
Approach
(Robbins, et. al., 2006, Exhibit 1.5, p. 12)
• Interpersonal roles
• Figurehead, leader, liaison
• Informational roles
• Monitor, disseminator,
spokesperson
• Decisional roles
• Entrepreneur, disturbance handler,
resource allocator, negotiator
Exhibit 1.6 Skills Needed at Different Management
Levels
Top
Conceptual
Managers Skills
Middle Human
Managers Skills
Technical
Lower-level
Managers Skills
Importance
Exhibit 1.8 The Changing Organization
Traditional New Organization
• Stable • Dynamic
• Inflexible • Flexible
• Job-focused • Skills-focused
• Work is defined by job positions • Work is defined in terms of tasks to be done
• Individual-oriented • Team-oriented
• Permanent jobs • Temporary jobs
• Command-oriented • Involvement-oriented
• Managers always make decisions • Employees participate in decision making
• Rule-oriented • Customer-oriented
• Relatively homogeneous workforce • Diverse workforce
• Workdays defined as 9 to 5
• Workdays have no time boundaries
• Hierarchical relationships
• Lateral and networked relationships
• Work at organizational facility during
specific hours • Work anywhere, anytime
Exhibit 1.9 Challenges Impacting the
Manager’s Job
Ethics
Knowledge
Management Diversity
Manager
Innovation Globalization
Customers E-Business
1
Challenges to Managing
• Ethics
• Increased emphasis on ethics education in university and college
curriculums
• Increased creation and use of codes of ethics by businesses
• Workforce Diversity
• Increasing heterogeneity in the workforce
• More gender, minority, ethnic, and other forms of diversity in
employees (cultural values important)
• Biggest immediate issue? (aging pop.)
Challenges to Managing (cont’d)
• Globalization
• Management in international organizations
• Political and cultural challenges of operating in a global market
• E-business (electronic business)
• The work performed by an organization using electronic linkages to
its key constituencies
• E-commerce: the sales and marketing component of an e-business
• Importance of Customers
• Customers have more opportunities than ever before
• Delivering consistent high-quality service is essential
• Managers need to create customer-responsive organizations
• Innovation
• Doing things differently, exploring new territory, and taking risks
• Managers need to encourage all employees to be innovative
• Knowledge Management
• The cultivation of a learning culture where organizational members
systematically gather and share knowledge with others in order to
achieve better performance
• Learning Organization
• An organization that has developed the capacity to continuously
learn, adapt, and change
Exhibit 1.11 Learning Organization Vs.
Traditional Organization
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Why Study Management?
• The Value of Studying Management
• The universality of management
• Good management is needed in all organizations
• The reality of work
• Employees either manage or are managed
• Entrepreneurship
• The organized effort to pursue opportunities to create value
and grow through innovation and uniqueness
Planning Ahead — Chapter 2 Study Questions
1. What can be learned from classical management

thinking?
2. What insights come from behavioral management
approaches?
3. What are the foundations of modern management
thinking?
Chapter 2 Learning Dashboard
1. Classical Management Approaches

1. Scientific management
2. Administrative principles
3. Bureaucratic organization
2. Behavioral Management Approaches
1. Follett’s organizations as communities
2. The Hawthorne studies
3. Maslow’s theory of human needs
4. McGregor’s Theory X and Theory Y
5. Argyris’s theory of adult personality
Chapter 2 Learning Dashboard
3. Modern Management Foundations

1. Quantitative analysis and tools
2. Organization as systems
3. Contingency thinking
4. Quality management
5. Knowledge management and organizational learning
6. Evidence-based management
Figure 2.1 Major branches in the classical
approach to management
Takeaway 1: Classical Management Approaches
• Four guiding principles of scientific management

(Frederick Taylor)
1. Develop for every job a “science” that includes rules of
motion, standardized work implements, and proper
working conditions.
2. Carefully select workers with the right abilities for the
job.
3. Carefully train workers to do the job and give them the
proper incentives to cooperate with the job “science.”
4. Support workers by carefully planning their work and
by smoothing the way as they go about their jobs.
Takeaway 1: Classical Management
Approaches
• Scientific management (the Gilbreths)

• Motion study
• Science of reducing a job or task to its basic
physical motions
• Eliminating wasted motions improves
performance
• Practical lessons from scientific management

• Make results-based compensation a performance
incentive
• Carefully design jobs with efficient work methods
• Carefully select workers with the abilities to do
these jobs
• Train workers to perform jobs to the best of their
abilities
• Train supervisors to support workers so they can
perform jobs to the best of their abilities
• Administrative principles (Henri Fayol) — rules/duties

of management:
Foresight Organization Command Coordination Control
to fit diverse to make sure

to provide and to lead, select, efforts together things happen
to complete a mobilize and evaluate and ensure according to
plan of action resources to workers to get information is plan and to take
for the future implement the the best work shared and necessary
plan toward the plan problems corrective
solved action
• Administrative principles (Henri Fayol)

• Scalar chain
• there should be a clear and unbroken line of
communication from the top to the bottom of the
organization
• Unity of command
• each person should receive orders from only one boss
• Unity of direction
• one person should be in charge of all activities with the
same performance objective
• Bureaucratic organization (Max Weber)

• Bureaucracy
• An ideal, intentionally rational, and very
efficient form of organization
• Based on principles of logic,
order, and legitimate
authority
• Characteristics of bureaucratic organizations:

• Clear division of labor
• Clear hierarchy of authority
• Formal rules and procedures
• Impersonality
• Careers based on merit
Takeaway 1: Classical Management
Approaches
• Possible disadvantages of bureaucracy:
• Excessive paperwork or “red tape”
• Slowness in handling problems
• Rigidity in the face of shifting needs
• Resistance to change
• Employee apathy
Figure 2.2 Foundations in the behavioral or
human resource approaches to management
Organizations as
communities
Mary Parker
Follett Theory X and
Hawthorne
Theory Y
studies
Douglas
Elton Mayo
McGregor
Human resource
Theory of human approaches Personality and
needs Assumption: organization
Abraham Maslow People are social Chris Argyris
and self-actualizing
Takeaway 2: Behavioral Management
Approaches
• Organizations as communities
– Mary Parker Follett
• Groups and human cooperation:
• Groups allow individuals to combine their talents for a greater
good
• Organizations are cooperating “communities” of managers and
workers
• Manager’s job is to help people cooperate and achieve an
integration of interests
Takeaway 2: Behavioral Management Approaches
• Organizations as communities
• Forward-looking management insights:
Making every employee • precursor of employee ownership,

an owner creates a sense
of collective responsibility profit sharing, and gain-sharing
Business problems involve

a variety of inter-related • precursor of systems thinking
factors
Private profits relative to • precursor of managerial ethics and

public good social responsibility
• Hawthorne studies
• Initial study examined how economic incentives
and physical conditions affected worker output
• No consistent relationship found
• “Psychological factors” influenced results
• Hawthorne studies (cont.)

• Social setting and human relations
• Manipulated physical work conditions to assess
impact on output
• Designed to minimize the “psychological
factors” of previous experiment
• Mayo and colleagues concluded:
• New “social setting” led workers to do good
job
• Good “human relations” = higher
productivity
• Hawthorne studies (cont.)

• Employee attitudes and group processes
• Some things satisfied some workers but not
others
• People restricted output to adhere to group
norms
• Lessons from the Hawthorne Studies:

• Social and human concerns are keys to
productivity
• Hawthorne effect — people who are singled out
for special attention perform as expected
• Maslow’s theory of human needs

• A need is a physiological or psychological
deficiency a person feels compelled to satisfy
• Need levels:
• Physiological
• Safety
• Social
• Esteem
• Self-actualization
Figure 2.3 Maslow’s hierarchy of human needs
• Maslow’s theory of human needs
• Deficit principle
• A satisfied need is not a motivator of behavior
• Progression principle
• A need becomes a motivator once the
preceding lower-level need is satisfied
• Both principles cease to operate at self-
actualization level
Takeaway 2: Behavioral Management
Approaches
• McGregor’s Theory X assumes that workers:

• Dislike work
• Lack ambition
• Are irresponsible
• Resist change
• Prefer to be led
• McGregor’s Theory Y assumes that workers are:

• Willing to work
• Capable of self control
• Willing to accept responsibility
• Imaginative and creative
• Capable of self-direction
• Implications of Theory X and Theory Y:

• Managers create self-fulfilling prophecies
• Theory X managers create situations where
workers become dependent and reluctant
• Theory Y managers create situations where
workers respond with initiative and high
performance
• Central to notions of empowerment and self-
management
• Argyris’s theory of adult personality

• Classical management principles and practices
inhibit worker maturation and are inconsistent
with the mature adult personality
• Psychological success occurs when people define
own goals
• Argyris’s theory of adult personality

• Management practices should accommodate the
mature personality by:
• Increasing task responsibility
• Increasing task variety
• Using participative decision making
Takeaway 3: Modern Management Foundations
• Foundations for continuing developments in

management
Quantitative analysis and tools
Systems view of organizations
Contingency thinking
Commitment to quality and performance
Knowledge management and learning organizations
Evidence-based management
• Management science or operations research
Quality control
Inventory Queuing
management theory
Supply chain Linear

management programming
The scientific
applications of
mathematical
Value chain techniques to Network
analysis management models
problems
• Quantitative Analysis and Tools

• Analytics – the use of large data bases and
mathematics to solve problems and make
informed decisions using systematic analysis
• Typical quantitative approach to managerial
problem-solving
• Problem encountered, it is systematically
analyzed, appropriate mathematical
models and computations applied, optimal
solution identified
• Organizations as Systems
• System
• Collection of interrelated parts that function
together to achieve a common purpose
• Subsystem
• A smaller component of a larger system
• Open systems
• Organizations that interact with their
environments in the continual process of
transforming resource inputs into outputs
Figure 2.4 Organizations as complex networks of interacting
subsystems
Takeaway 3: Modern Management
Foundations
• Contingency thinking
• Tries to match managerial responses with
problems and opportunities
unique to different situations
• No “one best way” to manage
• Appropriate way to manage
depends on the situation
• Quality management
• Managers and workers in progressive
organizations are quality conscious
• Quality and competitive advantage are linked
• Total quality management (TQM)
• Comprehensive approach to continuous
quality improvement for a total organization
• Creates context for the value chain
• Continuous improvement
• Continual search for new ways to improve
quality
• Something always can and should be
improved
• ISO certification
• Global quality benchmark
• Refine and upgrade quality to meet ISO
standards
• Knowledge Management and Organizational

Learning
• Knowledge management is the process of using
intellectual capital for competitive advantage
• Portfolio of intellectual assets include patents,
intellectual property rights, trade secrets, and
accumulated knowledge of the entire workforce
• Learning organizations
• Organizations that are able to continually learn
and adapt to new circumstances
• Core ingredients include:
Encourage Information
Teamwork Empowerment Participation
learning sharing
Takeaway 3: Modern Management
Foundations
• Evidence-Based Management
• Making management decisions on “hard facts”
about what really works
• Evidence-Based Positive Human Resource

Management Practices
• Employment security
• Selective hiring
• Self-managing teams
• High pay based on merit
• Training and development
• Reduced status distinctions
• Shared information
Planning
Definition
• The planning process is the tool that people and organizations use to manage their
relationships with the future. It is a specific application of the decision-making process.
• Decisions that seek to influence the future, or that will be put into practice in the future, are
planning decisions.
Based on this basic concept, the planning process can be defined in several ways:
Plan:
o It is to define objectives or results to be achieved;
o It is to define means to enable results to be achieved.
o It is to interfere in reality to move from a known situation to the desired situation within a
o defined interval of time.
o It is to make decisions that affect the future in order to reduce its uncertainty
Planning
• Step 1: Environmental Scan. ...
• Step 2: Internal Analysis. ...
• Step 3: Strategic Direction. ...
• Step 4: Develop Goals and Objectives. ...
• Step 5: Define Metrics, Set Timelines, and Track Progress. ...
• Step 6: Write and Publish a Strategic Plan. ...
• Step 7: Plan for Implementation and the Future.
• Step 8: Feedback, Control & Correction
Effective planning
An organization must meet four basic requirements in drawing up its
plans:
• solid foundation of information,
• precise definition of objectives,
• forecasting of alternatives, and
• predominance of action.
1- Information base Information is a vitally important requirement for the
quality of planers.
• The first condition, therefore, is the fulfilment of this need, which is to
seek and analyze all data in order to assemble the most accurate picture
possible of the current situation and its evolution, as well as of the
available and necessary resources, so that objectives and courses of
action are realistic
• 2 - Flexibility
Whenever possible, the planning process should take into account the
variations that can be anticipated in the conditions for which plans are
being prepared.
• 3 - Predominance of action finally, action must have preponderance over

the planning itself. Planning prepares action, but does not replace it.
A - Strategic Plans
• Strategic planning is the process of defining goals and ways of accomplishing
them.
• In one company, strategic plans define objectives for the whole organization and
its intended relationship with the environment.
B - Functional Plans
• Functional Plans (also called administrative, departmental or tactical plans) are
designed to enable strategic plans to be realized.
• Functional plans cover areas of specialized business activities (marketing,
operations, human resources, finance, new products).
• They are responsible for the managers of these areas, who can also be assisted by
specialized units
C - Operational plans
• Operational planning is the process of defining activities and resources.
Operational plans specify activities and resources that are necessary to
accomplish any kind of goals.
• Although operational plans are more characteristic of the base of the
organizational pyramid, there is always an operational content in any
kind of plan.
Planning & Control
• Method 5 w 2 h –
Form of implementation of Planning any activity.
• The method is simple to use and the manager must answer the following seven
questions:
• What will be done ? (What)
• When will it be done? (When)
• Who will? (Who)
• Where will it be made? (Where)
• Why will it be done? (Why)
• How will it be done? (How)
• How much will it cost? (How much)
A brief description of these aspects is:
Mission –
defines the reason for existence of the company, and should answer the
following basic questions: What does the company do? Why does she do it? Who is the
company?
Vision –
defines the image or idea that the company has of itself. It guides its path to the
future, its relations with customers, how to manage available resources and its objectives.
Objectives –
are established in the planning phase, which must be challenging, but realistic
and in a position to be achieved. In order to achieve this, there is a need to establish clear
objectives, communicated to all those involved with clarity, precision, objectivity and
simplicity. The lack of these conditions can compromise the outcome of the entrepreneurial
process and determine the non-achievement of the objectives outlined.
Strategies –
strategies depend on several factors, such as: human resources (which directly
interfere in the definition of these strategies, depending on the personality of each one, one
or another strategy is used), characteristics of the company and the competition, seeking to
use strategies that maximize the strengths of one and the weaknesses of the other.
Organizing
What is organizing as a management function?

What are the major types of organization structures?
What are the new developments in organization structures?
What organizing trends are changing the workplace?
Management Fundamentals - Chapter 68

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Study Question 1: What is organizing as a management
function?
Organizing and organization structure

• Organizing
• The process of arranging people and other resources to work
together to accomplish a goal.
• Organization structure
• The system of tasks, workflows, reporting relationships, and
communication channels that link together diverse individuals
and groups.
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Figure 10.1 Organizing viewed in
relationship with the other management
functions.

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function?
Formal structures 
• The structure of the organization in its official state.
• An organization chart is a diagram describing reporting relationships and the
formal arrangement of work positions within an organization.
• An organization chart identifies the following aspects of formal structure:
• The division of work.
• Supervisory relationships.
• Communication channels.
• Major subunits.
• Levels of management.

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function?
Informal structures 
• A “shadow” organization made up of the unofficial, but often critical, working
relationships between organization members.
• Potential advantages of informal structures:
• Helping people accomplish their work.
• Overcoming limits of formal structure.
• Gaining access to interpersonal networks.
• Informal learning.

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function?
Informal structures (cont.) 

• Potential disadvantages of informal structures:
• May work against best interests of entire organization.
• Susceptibility to rumor.
• May carry inaccurate information.
• May breed resistance to change.
• Diversion of work efforts from important objectives.
• Feeling of alienation by outsiders.

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Study Question 2: What are the major types of organization
structures?
Functional structures
• People with similar skills and performing similar tasks are grouped
together into formal work units.
• Members work in their functional areas of expertise.
• Are not limited to businesses.
• Work well for small organizations producing few products or
services.

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Figure 10.2 Functional structures in a business, branch bank,
and community hospital.

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structures?
Potential advantages of functional structures:
• Economies of scale.
• Task assignments consistent with expertise and training.
• High-quality technical problem solving,
• In-depth training and skill development.
• Clear career paths within functions.

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structures?
Potential disadvantages of functional structures:
• Difficulties in pinpointing responsibilities.
• Functional chimneys problem.
• Sense of cooperation and common purpose break down.
• Narrow view of performance objectives.
• Excessive upward referral of decisions.

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structures?
Divisional structures
• Group together people who work on the same product or process,
serve similar customers, and/or are located in the same area or
geographical region.
• Common in complex organizations.
• Avoid problems associated with functional structures.

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Figure 10.3 Divisional structures based on product,
geography, customer, and process.

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structures?
Potential advantages of divisional structures:
• More flexibility in responding to environmental changes.
• Improved coordination.
• Clear points of responsibility.
• Expertise focused on specific customers, products, and regions.
• Greater ease in restructuring.

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structures?
Potential disadvantages of divisional structures:
• Duplication of resources and efforts across divisions.
• Competition and poor coordination across divisions.
• Emphasis on divisional goals at expense of organizational goals.

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structures?
Types of divisional structures and how they group job and activities:
• Product structures focus on a single product or service.
• Geographical structures focus on the same location or geographical region.
• Customer structures focus on the same customers or clients.
• Process structures focus on the same processes.

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structures?
Matrix structure
• Combines functional and divisional structures to gain advantages and
minimize disadvantages of each.
• Used in:
• Manufacturing
• Service industries
• Professional fields
• Non-profit sector
• Multi-national corporations
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Figure 10.4 Matrix structure in a small multiproject
business firm.

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structures?
Potential advantages of matrix structures:

• Better cooperation across functions.
• Improved decision making.
• Increased flexibility in restructuring.
• Better customer service.
• Better performance accountability.
• Improved strategic management.
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structures?
Potential disadvantages of matrix structures:

• Two-boss system is susceptible to power struggles.
• Two-boss system can create task confusion and conflict in work priorities.
• Team meetings are time consuming.
• Team may develop “groupitis.”
• Increased costs due to adding team leers to structure.

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Study Question 3: What are the new developments in
organization structures?
Guidelines for horizontal structures:
• Focus the organization around processes, not functions.
• Put people in charge of core processes.
• Decrease hierarchy and increase the use of teams.
• Empower people to make decisions critical to performance.
• Utilize information technology.
• Emphasize multiskilling and multiple competencies.
• Teach people how to work in partnership with others.
• Build a culture of openness, collaboration, and performance commitment.

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Team structures
• Extensively use permanent and temporary
teams to solve problems, complete special
projects, and accomplish day-to-day tasks.
• Often use cross-functional teams.

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Figure 10.5 How a team structure uses cross-functional
teams for improved lateral relations.

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Potential advantages of team structures:
• Eliminates difficulties with communication and decision making.
• Eliminates barriers between operating departments.
• Improved morale.
• Greater sense of involvement and identification.
• Increased enthusiasm for work.
• Improved quality and speed of decision making.

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Potential disadvantages of team structures:
• Conflicting loyalties among members.
• Excessive time spent in meetings.
• Effective use of time depends on quality of interpersonal relations,

group dynamics, and team management.

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Network structures
• A central core that is linked through networks of relationships with

outside contractors and suppliers of essential services.
• Own only core components and use strategic alliances or
outsourcing to provide other components.

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Figure 10.6 A network structure for a Web-based retail
business.

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Potential advantages of network structures:
• Firms can operate with fewer full-time employees and less complex
internal systems.
• Reduced overhead costs and increased operating efficiency.
• Permits operations across great distances.

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Potential disadvantages of network structures:
• Control and coordination problems may arise from network
complexity.
• Potential loss of control over outsourced activities.
• Potential lack of loyalty among infrequently used contractors.
• Excessively aggressive outsourcing can be dangerous.

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Deadly sins of outsourcing:
• Outsourcing activities that are part of the core.
• Outsourcing to untrustworthy vendors.
• Not having good contracts with the vendor.
• Overlooking impact on existing employees.
• Not maintaining oversight; losing control to vendors.
• Overlooking hidden costs of managing contracts.
• Failing to anticipate need to change vendors, cease outsourcing.

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Boundaryless organizations
• Eliminate internal boundaries among subsystems and external boundaries
with the external environment.
• A combination of team and network structures, with the addition of
“temporariness.”
• Key requirements:
• Absence of hierarchy.
• Empowerment of team members.
• Technology utilization.
• Acceptance of impermanence.

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Figure 10.7 The boundaryless organization eliminates
internal and external barriers.

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Boundaryless organizations (cont.)

• Encourage creativity, quality, timeliness, flexibility, and efficiency.
• Knowledge sharing is both a goal and essential component.
• Virtual organization.
• A special form of boundaryless organization.
• Operates in a shifting network of external alliances that are engaged as needed, using IT
and the Internet.

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Study Question 4: What organizing trends are changing the
workplace?
Contemporary organizing trends include:

• Shorter chains of command.
• Less unity of command.
• Wider spans of control.
• More delegation and empowerment.
• Decentralization with centralization.
• Reduced use of staff.
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workplace?
Shorter chains of command
• The line of authority that vertically links all persons with
successively higher levels of management.
• Organizing trend:
• Organizations are being “streamlined” by cutting unnecessary
levels of management.
• Flatter structures are viewed as a competitive advantage.

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workplace?
Less unity of command
• Each person in an organization should report to one and only one
supervisor.
• Organizations are using more cross-functional teams, task
forces, and horizontal structures.
• Organizations are becoming more customer conscious.
• Employees often find themselves working for more than one
boss.
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workplace?
Wider spans of control
• The number of persons directly reporting to a manager.
• Many organizations are shifting to wider spans of control as
levels of management are eliminated.
• Managers have responsibility for a larger number of
subordinates who operate with less direct supervision.

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Figure 10.8 Spans of control in “flat” versus “tall”
structures.

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workplace?
More delegation and empowerment
• Delegation is the process of entrusting work to others by giving
them the right to make decisions and take action.
• The manager assigns responsibility, grants authority to act, and
creates accountability.
• Authority should be commensurate with responsibility.

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workplace?
Guidelines for effective delegation:
• Carefully choose the person to whom you delegate.
• Define the responsibility; make the assignment clear.
• Agree on performance objectives and standards.
• Agree on a performance timetable.
• Give authority; allow the other person to act independently.
• Show trust in the other person.
• Provide performance support.
• Give performance feedback
• Recognize and reinforce progress.
• Help when things go wrong.
• Don’t forget your accountability for performance results.
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workplace?
More delegation and empowerment (cont.)

• A common management failure is unwillingness to delegate.
• Delegation leads to empowerment.
• Managers are delegating more and finding more ways to
empower people at all levels.

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workplace?
Decentralization with centralization

• Centralization is the concentration of authority for making most
decisions at the top levels of the organization.
• Decentralization is the dispersion of authority to make decisions
throughout all levels of the organization.

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workplace?
Decentralization with centralization (cont.)
• Centralization and decentralization not an “either/or” choice.
• Delegation, empowerment, and horizontal structures
contribute to more decentralization in organizations.
• Advances in information technology allow for the retention of
centralized control.

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workplace?
Reduced use of staff

• Specialized staff
• People who perform a technical service or provide special
problem-solving expertise to other parts of the organization.
• Personal staff
• People working in “assistant-to” positions that provide special
support to higher-level managers.

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workplace?
Reduced use of staff (cont.)
• Line and staff managers may disagree over staff authority.
• Advisory Authority.
• Functional authority.
• No one best solution for dividing line-staff responsibilities.
• Organizations are reducing staff size.
• Organizations are seeking increased operating efficiency by employing fewer staff
personnel and smaller staff units.

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Staffing
• The managerial function of staffing involves manning the
organization structure through proper and effective selection,
appraisal and development of the personnel to fill the roles
assigned to the employers/workforce.
• Nature: Staffing is an important managerial function.

o Staffing is a pervasive activity.
o Staffing is a continuous activity.
o The basis of staffing function is efficient management of personnel.
o Staffing helps in placing right men at the right job. • Staffing is
performed by all managers .
Directing
Coordination
• Coordination Meaning
• Coordination is the function of management which ensures that
different departments and groups work in sync. Therefore, there is unity
of action among the employees, groups, and departments.
• Coordination is an important aspect of any group effort. When an
individual is working, there is no need for coordination.
• Coordination implies synchronization of various efforts of different
departments to reduce conflict. Multiple departments usually perform
the work for which an organization exists.
Coordination
• Common definitions of the coordination function
• Mooney and Reiley – ‘Coordination is an orderly arrangement of group efforts to provide unity of
action in the pursuit of common goals.‘
• Charles Worth – ‘Coordination is the integration of several parts into an orderly hole to achieve the
purpose of understanding.‘
• Brech – ‘Coordination is balancing and keeping together the team by ensuring suitable allocation of
tasks to the various members and seeing that the tasks are performed with the harmony among the
members themselves.‘
• Mary Parker Follett – ‘The first test of a business administration should be whether you have a
business with all its parts so coordinated, so moving together in their closely knit and adjusting
activities, so linking, inter-locking, inter-relating, that they make a working unit that is not congenic
of separate pieces, but a functional whole or integrated unit.‘
The important features of coordination are:
• It is essential for group efforts and not for individual efforts.

• It is a continuous and dynamic process.
• Coordination emphasizes the unity of efforts
• Helps in the integration of functions
• It is the responsibility of every manager in the organization.
Control
• Organizational control that focuses the monitoring and evaluation of the
strategic management process in order to ensure that everything works
properly.
• It aims to ensure that the strategies will be implemented as planned, ie
that everything will happen as planned
• Definition of resources control
• At the end of the planning process is the definition of the means to see if
the objectives are being realized. The control function is to follow the
execution of the activities and the degree of accomplishment of the
objectives.
• In order to control, it is necessary to define the means of control in the
planning phase. In essence, the means of control need to be defined:
A. Systems for producing information on the progress of activities.
B. Form of processing, presentation and destination of information.
C. Definition of decisions to be made on the basis of information
Controlling as a Management Function
• Controlling
• A process of monitoring performance and taking action to ensure
desired results.
• It sees to it that the right things happen, in the right ways, and at
the right time.
153
• Controlling
• Done well, it ensures that the overall directions of individuals and
groups are consistent with short and long range plans.
• It helps ensure that objectives and accomplishments are consistent
with one another throughout an organization.
154
• Controlling
• It helps maintain compliance with essential organizational rules
and policies.
155
• Cybernetic Control System
• One that is self-contained in its performance monitoring and
correction capabilities. (thermostat)
• The control process practiced in organizations is not cybernetic, but
it does follow similar principles.
156
The Control Process
• Establish objectives and standards.
• Measure actual performance.
• Compare results with objectives and standards.
• Take necessary action.
157
Establish Objectives and Standards
• The control process begins with planning and the establishment of

performance objectives.
• Performance objectives are defined and the standards for measuring
them are set.
158
Establish Objectives and Standards
• There are two types of standards:

• Output Standards - measures performance
results in terms of quantity, quality, cost, or time.
• Input Standards - measures work efforts that go
into a performance task.
159
Measuring Actual Performance
• Measurements must be accurate enough to spot

deviations or variances between what really occurs
and what is most desired.
• Without measurement, effective control is not
possible.
160
Comparing Results with Objectives
and Standards
• The comparison of actual performance with desired

performance establishes the need for action.
• Ways of making such comparisons include:
• Historical / Relative / Engineering
• Benchmarking
161
Planning & Control
• Method 5 w 2 h –
Form of implementation of Planning any activity.
• The method is simple to use and the manager must answer the following seven
questions:
• What will be done ? (What)
• When will it be done? (When)
• Who will? (Who)
• Where will it be made? (Where)
• Why will it be done? (Why)
• How will it be done? (How)
• How much will it cost? (How much)
Taking Corrective Action
• Taking any action necessary to correct or improve

things.
• Management-by-Exception focuses managerial
attention on substantial differences between actual
and desired performance.
163
Taking Corrective Action
• Management-by Exception can save the

managers time, energy, and other resources,
and concentrates efforts on areas showing the
greatest need.
• There are two types of exceptions:
• Problems - below standard
• Opportunities - above standard
164
Effective Controls
The Best Controls in Organizations are
• Strategic and results oriented

• Understandable
• Encourage self-control
165
Effective Controls
The Best Controls in Organizations are
• Timely and exception oriented

• Positive in nature
• Fair and objective
• Flexible
166
Types of Control
• Preliminary
• Before a work activity begins.
• They make sure that proper directions are set and
that the right resources are available to accomplish
them.
167
Types of Control
• Concurrent
Focus on what happens during the work process. Sometimes called
steering controls, they monitor ongoing operations and activities to
make sure that things are being done correctly.
168
Types of Control
• Post action
Sometimes called feedback controls, they take place
after an action is completed. They focus on end
results, as opposed to inputs and activities.
169
Types of Controls
Managers have two broad options with respect to control.
• They can rely on people to exercise self-control (internal) over their
own behavior.
• Alternatively, managers can take direct action (external) to control the
behavior of others.
170
Types of Control
• Internal Controls
Allows motivated individuals to exercise self-control
in fulfilling job expectations.
The potential for self-control is enhanced when
capable people have clear performance objectives
and proper resource support.
171
Types of Control
• External Controls
It occurs through personal supervision and the use of
formal administrative systems.
• Performance appraisal systems, compensation and
benefit systems, employee discipline systems, and
management-by-objectives.
172
Organizational Control Systems
• Management Processes
• Strategy and objectives
• Policies and procedures
• Selection and training
• Performance appraisal
• Job design and work structures
• Performance modeling, norms, and organization culture
173
• Compensation and Benefits

• Attract talented people and retain them.
• Motivate people to exert maximum effort in
their work.
• Recognize the value of their performance
contributions.
174
• Employee Discipline
• Discipline is defined as influencing behavior
through reprimand.
• Progressive Discipline ties reprimand to the
severity and frequency of the employee’s
infractions.
• Positive Discipline tries to involve people more
positively and directly in making decisions to
improve their behavior.
175
The “Hot Stove Rule”
To be Effective Discipline Should be:

• Immediate • Informative
• Focus on activity not • Occur in a supportive
personality setting
• Consistent • Support realistic rules
176
• Information and Financial

• Activity-based costing - the true cost of all
products and services.
• Economic value added - examine the value
added by all activities.
• Understand the implication of key financial
measures of (ratios) organizational performance
177
Operations Management and Control
• Purchasing
• Economic Order Quantity
automatic reorder points
• Just-In-Time Scheduling
178
• Project Management
• Program Evaluation and Review Technique
(PERT) - Identifies and controls the many
separate events in complex projects.
179
• Statistical Quality Control

• Based on the establishment of upper and lower
control limits, that can be graphically and statistically
monitored to ensure that products meet standards.
180

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R.C.

Planning Organizing Leading Controlling

1. What can be learned from classical management

1. Classical Management Approaches

3. Modern Management Foundations

• Four guiding principles of scientific management

• Scientific management (the Gilbreths)

• Practical lessons from scientific management

• Administrative principles (Henri Fayol) — rules/duties

Foresight Organization Command Coordination Control

to fit diverse to make sure

• Administrative principles (Henri Fayol)

• Bureaucratic organization (Max Weber)

• Characteristics of bureaucratic organizations:

Making every employee • precursor of employee ownership,

Business problems involve

Private profits relative to • precursor of managerial ethics and

• Hawthorne studies (cont.)

• Hawthorne studies (cont.)

• Lessons from the Hawthorne Studies:

• Maslow’s theory of human needs

• McGregor’s Theory X assumes that workers:

• McGregor’s Theory Y assumes that workers are:

• Implications of Theory X and Theory Y:

• Argyris’s theory of adult personality

• Argyris’s theory of adult personality

• Foundations for continuing developments in

Quantitative analysis and tools

Systems view of organizations

Commitment to quality and performance

Knowledge management and learning organizations

• Management science or operations research

Supply chain Linear

• Quantitative Analysis and Tools

• Knowledge Management and Organizational

• Evidence-Based Positive Human Resource

• 3 - Predominance of action finally, action must have preponderance over

What is organizing as a management function?

Management Fundamentals - Chapter 68

Organizing and organization structure

Management Fundamentals - Chapter 70

Management Fundamentals - Chapter 71

Management Fundamentals - Chapter 72

Informal structures (cont.) 

• May carry inaccurate information.

• May breed resistance to change.

• Diversion of work efforts from important objectives.

• Feeling of alienation by outsiders.

Management Fundamentals - Chapter 74

Management Fundamentals - Chapter 75

Management Fundamentals - Chapter 76

Management Fundamentals - Chapter 77

Management Fundamentals - Chapter 78

Management Fundamentals - Chapter 79

Management Fundamentals - Chapter 80

Management Fundamentals - Chapter 81

• Geographical structures focus on the same location or geographical region.

• Customer structures focus on the same customers or clients.

• Process structures focus on the same processes.

Management Fundamentals - Chapter 82

Management Fundamentals - Chapter 84

Potential advantages of matrix structures:

Potential disadvantages of matrix structures: