Introduction to Business

Management
11th edition
Ancillary material
ISBN 978 019 07 4576 9
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 Chapter 6
Introduction to general management
Learning outcomes

• Give an overview of the role of management in businesses

• Describe the four fundamental management functions, namely
planning, organising, leading and controlling
• Explain the management process
• Comment on the different levels and functional areas of
management in the business organisation
• Describe the various schools of thought in management
• Describe the development of management theory.
Chapter outline

• Introduction
• The role of management
• A definition of management
• Different levels and functional areas of management in businesses
• Skills needed at different managerial levels
• The role of managers
• Development of management theory
• Summary
The role of management

• Management is indispensable for the following reasons:

• Management directs a business towards its goals
• Management sets and keeps the operations of the business on a balanced
course
• Management keeps the organisation in equilibrium with its environment
• Management is necessary to reach the goals of the organisation at the
highest possible level of productivity
Main causes of business failure
A definition of management

• Management is defined as the process followed by managers to

accomplish a business’s goals and objectives.
• It is a process of activities that is carried out to enable a business to
accomplish its goals by employing human, financial and physical
resources for that purpose.
A definition of management (continued)
The different levels of management

• Managers are found at all levels of a business hierarchy

• Each manager is in charge of a number of managers, who are in
charge of a number of subordinates
• A business has different types of managers, each responsible for
the management of a specialised group of activities.
The different levels of management (continued)
Top management
• Small group of executives who
control the business and have
the final authority and
responsibility.
• For example board of directors,
partners, managing director
Middle management
• Responsible for certain
functional areas of the business
and accountable for executing
policies, plans and strategies
determined by top management
• For example marketing manager,
purchasing manager, human
resources manager
Lower management
• Supervisory management,
responsible for smaller
segments of business
• For example the marketing
department could have a
product manager, promotions
manager or sales manager.
Supervisors and foremen are
also included in lower
management.
The functional areas of management
The functional areas of management (continued)

• The specialised managers necessary for the different functions of

the business
• Only responsible for the specified management activities of their functions
or departments
• Plan, organise, lead and control their departments
• Number and importance of specialised areas vary from business to business
• Only one organisational function – general management – universally
encountered and plays definite part in every organisation.
The functional areas of management (continued)

• The function of general management

• Integrates all other functions of management
• Deals with activities of top management
• The over-riding function that controls the management process and general
principles of management applied by top management.
Skills needed at different managerial levels

• The three key skills required for sound management:

• Conceptual skills
• Interpersonal skills
• Technical skills.
Skills needed at different managerial levels (continued)
The role of managers

• A manager performs certain functions, meets certain needs and

assumes certain responsibilities for the business.
• Managers fulfill ten different roles.
• These roles can be placed in three overlapping groups:
• Interpersonal role
• Information role
• Decision-making role.
The role of managers (continued)
The role of managers (continued)

Four main supporting management activities are normally

distinguished:
• Gathering and processing of information to make decisions
• Decision-making
• Communication
• Negotiation.
Development of management theory

• Many theories about how to improve the performance of the

organisation
• The legacy of past successes and failures becomes part of present
and future management approaches
• Two main schools of thought used to classify management theory:
• The classical approach (+1990–1950)
• The contemporary approach (+1960–present)
Development of management theory (continued)
Development of management theory (continued)

Classical approaches
• The scientific school
• The management process school
• The human relations or behavioural school
• The quantitative school
• The systems approach.
Development of management theory (continued)

Contemporary approaches
• The contingency approach
• Strategic management
• Total quality management
• Re-engineering of businesses
• Diversity management.
Summary

• Management is an indispensable component of any business

• Management defined as a functional process
• One distinct function – general management
• Each level of management requires certain skills
• Roles played by managers differ from level to level
• Discussed development and evolution of management theory, and
its various approaches.