PRINCIPLES &

PRACTICE OF Dr. Sushant Kishore Waghmare

MANAGEMENT
 MODULE-I:
MANAGEMENT, MANAGER
AND MANAGEMENT THEORIES
INTRODUCTION
MANAGEMENT
The concept of management has acquired special significance in the present
competitive and complex business world.
Efficient and purposeful management is absolutely essential for the survival
of a business unit.
Management concept is comprehensive and covers all aspects of business.
In simple words, management means utilizing available resources in the best
possible manner and also for achieving well defined objectives.
It is a distinct and dynamic process involving use of different resources for
achieving well defined objectives
6MS Men

Markets Money

6Ms

Methods Materials

Machine
s
MANAGEMENT EXPLAINED
Management is the act of getting people together to accomplish desired goals
and objectives using available resources efficiently and effectively.
Management comprises planning, organizing, staffing, leading, coordinating
and controlling an organization (a group of one or more people or entities) or
effort for the purpose of accomplishing a goal. Resourcing encompasses the
development and manipulation of human resources, financial resources,
technological resources and natural resources.
Management is essential for the conduct of business activity in an orderly
manner. It is a vital function concerned with all aspects of working of an
enterprise.
MAJOR DEFINITIONS
According to Harold Koontz, "Management is the art of getting things done
through and with people in formally organized groups".

According to Henry Fayol, "To manage is to forecast and to plan, to organise,

to command, to coordinate and to control".

According to Peter Drucker, "Management is a multi-purpose organ that

manages business and manages managers and manages workers and work".
MANAG Replication is
possible
Systematic
body of
knowledge
EMENT
SCIENCE
Scientific
principles are
Universal derived on the
Validity basis of logical
and scientific
observations

Principles are
based on
repeated
experiments
MANAGEMENT ART
Existence of
theoretical
knowledge

Personalised
application

Based on
Practice and
creativity
MANAGEMENT PROFESSION

Well defined Presence of

Restricted
Body of professional
Entry
knowledge associations

Existence of
Service
ethical
Motive
codes
 MANAGEMENT FEATURES
Group
Activity
All Pervasive
Continuous
Integrates
Human,
Goal-Oriented Physical and
Financial
Resources
 LEVELS OF
MANAGEMENT
MANAGEMENT LEVELS

Top
Middle
Low
TOP MANAGEMENT
Board of directors, chief executive or managing director. Ultimate source of
authority and it manages goals and policies for an enterprise. Devotes more
time on planning and coordinating functions.
The role of the top management can be summarized as follows -
 Lays down the objectives and broad policies of the enterprise.
 Issues necessary instructions for preparation of department budgets, procedures,
schedules etc.
 Prepares strategic plans & policies for the enterprise.
 Appoints the executive for middle level i.e. departmental managers.
 Controls & coordinates the activities of all the departments.
 Maintains contact with the outside world.
 Provides guidance and direction.
 Responsible towards the shareholders for the performance of the enterprise.
 MIDDLE MANAGEMENT
The branch managers and departmental managers constitute middle level. They are responsible to the top
management for the functioning of their department. They devote more time to organizational and
directional functions. In small organization, there is only one layer of middle level of management but in big
enterprises, there may be senior and junior middle level management. Their role can be emphasized as -
Execute the plans of the organization in accordance with the policies and directives of the top management.
Make plans for the sub-units of the organization.
Participate in employment & training of lower level management.
Interpret and explain policies from top level management to lower level.
Responsible for coordinating the activities within the division or department
Sends important reports and other important data to top level management
Evaluate performance of junior managers.
Responsible for inspiring lower level managers towards better performance
 LOW MANAGEMENT
Supervisory / operative level of management. Consists of supervisors, foreman, section officers,
superintendent etc. Their activities include -
 Assigning of jobs and tasks to various workers.
 Guide and instruct workers for day to day activities.
 Responsible for the quality as well as quantity of production.
 Entrusted with the responsibility of maintaining good relation in the organization.
 Communicate workers problems, suggestions, and recommendatory appeals etc to the higher level and higher
level goals and objectives to the workers.
 Solve the grievances of the workers.
 Supervise & guide the sub-ordinates.
 Responsible for providing training to the workers.
 Arrange necessary materials, machines, tools etc for getting the things done.
 Prepare periodical reports about the performance of the workers.
 Ensure discipline in the enterprise.
 Motivate workers.
 Image builders of the enterprise because they are in direct contact with the workers.
LEVELS OF SKILLS
WHAT DO YOU NEED TO
MAKE THIS?
MANAGERIAL SKILLS
Technical skills: Technical skills that reflect both an understanding of and a proficiency in
a specialized field. For example, a manager may have technical skills in accounting,
finance, engineering, manufacturing, or computer science.
Human Skills: Human skills are skills associated with manager’s ability to work well with
others, both as a member of a group and as a leader who gets things done through other.
Conceptual Skills: Conceptual skills related to the ability to visualize the organization as
a whole, discern interrelationships among organizational parts, and understand how the
organization fits into the wider context of the industry, community, and world. Conceptual
skills, coupled with technical skills, human skills and knowledge base, are important
ingredients in organizational performance.

Design Skills: It is the ability to solve the problems in ways that will benefit the enterprise.
Managers must be able to solve the problems.
MANAGEMENT V.
ADMINISTRATION
Functions Management Administration

Meaning Management is an art of getting things It is concerned with formulation of broad

done through others by directing their objectives, plans & policies.
efforts towards achievement of pre-
determined goals.

Nature Management is an executing function. Administration is a decision-making

function.
Nature Management decides who should do it Administration decides what is to be done
& how should he do it. & when it is to be done.

Function Management is a doing function Administration is a thinking function

because managers get work done under because plans & policies are determined
their supervision. under it.

Skills & Technical and Human skill Conceptual and Human skills
Levels Middle & lower level function Conceptual and Human skills
Basis Management
Applicability It is applicable to business
concerns i.e. profit-making
organization.
Nature The management decisions are
influenced by the values,
opinions, beliefs & decisions of
the managers.
Status Management constitutes the
employees of the organization
who are paid remuneration (in
the form of salaries &
wages).
Administration
It is applicable to non-business
concerns i.e. clubs, schools,
hospitals etc.
The administration is influenced by
public opinion, govt. policies,
religious organizations, customs
etc.
Administration represents owners
of the enterprise who earn return on
their capital invested & profits in
the form of dividend.
ROLE OF MANAGER
HENRY
MINZT
BERG Figurehead
Interpersonal Leader
Liasion

Monitor
Manager Informational Disseminator
Spokesperson

Entrepreneur
Decisional Negotiator
Resource Allocator
Disturbance Handler
INTERPERSONAL ROLES
Leader – Responsible for staffing, training, and associated duties.

Figurehead – The symbolic head of the organization.

Liaison – Maintains the communication between all contacts and

informers that compose the organizational network
INFORMATIONAL ROLES
Related to collecting, receiving, and disseminating information.

Monitor – Personally seek and receive information, to be able to understand

the organization.

Disseminator – Transmits all import information received from outsiders to

the members of the organization.

Spokesperson – On the contrary to the above role, here the manager

transmits the organization’s plans, policies and actions to outsiders.
 DECISIONAL ROLES
Roles that revolve around making choices.

Entrepreneur – Seeks opportunities. Basically they search for change, respond to it, and exploit it.

Negotiator – Represents the organization at major negotiations.

Resource Allocator – Makes or approves all significant decisions related to the allocation of
resources.

Disturbance Handler – Responsible for corrective action when the organization faces disturbances.
 THEORIES OF
MANAGEMENT
 Theories

Classical Neo-Classical Modern

Human
Scientific Relations Systems
Movement

Gilbreth & Hawthorne

Quantitative
Gantt Experiment

Administrative Chester
Contingency
Theory Bernard

Bureaucratic Mary Parker Total Quality

Theory Follett Management
CLASSICAL THEORIES
F.W. TAYLOR-SCIENTIFIC
MANAGEMENT THEORY PART
1
Considered as “The Father of Scientific Management”
Wrote “The Principles of Scientific Management” in 1911.
Raised from labourer to chief engineer within 6 years.
Faced soldiering problem – practice of employees deliberately working at
pace slower than their capabilities.
F.W. TAYLOR-SCIENTIFIC
MANAGEMENT THEORY PART
2
Scientific management propounded by Taylor emphasizes:
Need for developing a scientific way of performing each job.
Training & preparing workers to perform that particular job.
Establishing harmonious relations between management & workers so that the job
is performed in the desired way.
Two managerial practices from Taylor’s approach are:
 Piece-Rate Incentive System – maximum pieces produced incentives received accordingly.
 Time-and-Motion study – jobs are broken down into various small tasks or motions &
unnecessary motions are removed to find out the best way of doing a job.
 SCIENTIFIC MANAGEMENT

Divide
Ensure
Science not work
Train most Pay Based
Rule of between
Employees efficient on Results
Thumb Managers
way is used
and Labour
 FRANK & LILLIAN GILBRETH
Frank Gilbreth (1868-1924) is considered as the “Father of Motion Study”.
Motion study involves finding out the best sequence & minimum number of motions needed to
complete a task.
Both were mainly involved in exploring new ways for eliminating unnecessary motions &
reducing
work fatigue.
Gilbreths devised classification scheme to label 17 basic hand motions of workers such as “search,
select, position & hold” called as “therbligs”.
Frank Gilbreth is best known for his experiment in reducing the number of motions in
bricklaying.
By analyzing brick layers job, he reduced the number of motions in bricklaying from 18.5 to 4.
Workers increased the number of bricks laid per day from 1000 to 2700 (per hr from 120 to 350
TIME & MOTION STUDY
HENRY LAURENCE GANTT
He was a close associate of Taylor.
Remembered for his work on the task-and-bonus system & the Gantt Chart.
Under this, if worker completed the work fast in less than standard time, he received
bonus.
Introduced incentive plan for foremen, who would be paid bonus for every worker
who reached daily standard & would receive extra bonus if all workers reached daily
standard.
Chart compares actual & planned performance.
• Indicates the production in terms of time rather than quantity.
• Horizontal axis – time, work scheduled & work completed.
• Vertical axis – individuals & machines assigned.
GANTT CHARTS
BUREAUCRATIC
MANAGEMENT
Weber believed that bureaucracy was the most efficient way to set up and manage an
organization, and absolutely necessary for larger companies to achieve maximum
productivity with many employees and tasks. Overall, Weber's ideal bureaucracy favors
efficiency, uniformity and a clear distribution of power. He argued that bureaucracy
constitutes the most efficient and rational way in which human activity can be organized
and that systematic processes and organized hierarchies are necessary to maintain order,
to maximize efficiency, and to eliminate favoritism. Major characteristics of Weber’s
Ideal Bureaucracy
• Work specialization & division of labour
• Abstract rules & regulations
• Impersonality of managers
• Hierarchy of organization structure
 Hierarchical
Management
Structure

Division of
Impartiality
Labour

Bureaucracy

Formal
Formal
Selection
Rules
Process

Career
Orientation
HENRI FAYOL’S
ADMINISTRATIVE
MANAGEMENT
This theory focuses on principles that could be used by managers to
coordinate the internal activities of organizations. Henri Fayol, also known as
the ‘father of modern management theory’ gave a new perception of the
concept of management.
He introduced a general theory that can be applied to all levels of management
and every department.
The Fayol theory is practiced by the managers to organize and regulate the
internal activities of an organization.
He concentrated on accomplishing managerial efficiency.
BUSINESS OPERATIONS
Technical – producing Financial – search for
Commercial – buying,
& manufacturing & optimal use of
selling & exchange.
products. capital.

Accounting – recording
Managerial – planning,
& taking stack of costs,
organizing,
Security – protecting profits & liabilities,
commanding,
employees & property. maintaining balance
coordinating &
sheets & compiling
controlling.
statistics.
QUIZ
WHAT ARE THEY DOING?
HOW DO YOU INTERPRET
THIS?
WHAT COMES TO YOUR MIND?
WHAT DO YOU INTERPRET?
WHAT’S HAPPENING HERE?
HOW DOES THIS MAKE YOU
FEEL?
WHAT DOES THIS SIGNIFY?
WHAT IS HE DOING?
WHO DO WE FOLLOW?
WHAT DOES THE WORLD
DEMAND?
WHAT WILL HAPPEN NOW?
DO YOU RECOGNIZE THIS
PERSON?
WHAT WOULD YOU CALL
THESE PEOPLE?
 14 PRINCIPLES OF
MANAGEMENT BY HENRI
FAYOL
Division PART
of Work: Henri 1 segregating work in the workforce amongst the
believed that
worker will enhance the quality of the product. Similarly, he also concluded that the
division of work improves the productivity, efficiency, accuracy and speed of the workers.
This principle is appropriate for both the managerial as well as a technical work level
Authority and Responsibility: These are the two key aspects of management. Authority
facilitates the management to work efficiently, and responsibility makes them responsible
for the work done under their guidance or leadership.
Discipline: Without discipline, nothing can be accomplished. It is the core value for any
project or any management. Good performance and sensible interrelation make the
management job easy and comprehensive. Employees good behaviour also helps them
smoothly build and progress in their professional careers.
Unity of Command: This means an employee should have only one boss and follow his
command. If an employee has to follow more than one boss, there begins a conflict of
interest and can create confusion
 14 PRINCIPLES OF
MANAGEMENT BY HENRI
FAYOL PART 2
Unity of Direction: Whoever is engaged in the same activity should have a unified goal. This
means all the person working in a company should have one goal and motive which will make
the work easier and achieve the set goal easily.
Subordination of Individual Interest: This indicates a company should work unitedly
towards the interest of a company rather than personal interest. Be subordinate to the purposes
of an organization. This refers to the whole chain of command in a company.
Remuneration: This plays an important role in motivating the workers of a company.
Remuneration can be monetary or non-monetary. However, it should be according to an
individual’s efforts they have made.
Centralization: In any company, the management or any authority responsible for the
decision-making process should be neutral. However, this depends on the size of an
organization. Henri Fayol stressed on the point that there should be a balance between the
hierarchy and division of power.
14 PRINCIPLES OF
MANAGEMENT BY HENRI
FAYOL PART 3
Scalar Chain: Fayol on this principle highlights that the hierarchy steps should be
from the top to the lowest. This is necessary so that every employee knows their
immediate senior also they should be able to contact any, if needed.

Order: A company should maintain a well-defined work order to have a favourable

work culture. The positive atmosphere in the workplace will boost more positive
productivity.

Equity: All employees should be treated equally and respectfully. It’s the
responsibility of a manager that no employees face discrimination
14 PRINCIPLES OF
MANAGEMENT BY HENRI
FAYOL PART 4
Stability: An employee delivers the best if they feel secure in their job. It is
the duty of the management to offer job security to their employees.

Initiative: The management should support and encourage the employees to

take initiatives in an organization. It will help them to increase their interest
and make them work.

Esprit de Corps: It is the responsibility of the management to motivate their

employees and be supportive of each other regularly. Developing trust and
mutual understanding will lead to a positive outcome and work environment.
NEO-CLASSICAL
NEO-CLASSICAL
CONTRIBUTION
Neoclassical theory has made significant contribution to an understanding of
human behavior at work and in organization. It has generated awareness of the
overwhelming role of human factor in industry.
This approach has given new ideas and techniques for better understanding of
human behavior.
The basic features of neoclassical approach are:
The business organization is a social system.
Human factor is the most important element in the social system.

It revealed the importance of social and psychological factors in determining

worker productivity and satisfaction
 What do you mean by

MOTIVATION?
MARY PARKER FOLLET PART-1
Mary Parker Follett, writer, social worker, political theorist and
organizational consultant, has been called "the woman who invented
management."

Follett never managed a for-profit enterprise herself, yet her keen insight
into the dynamics of organizations and groups gave her theories widespread
appeal.

She advocated a "pull" rather than "push" approach to employee motivation,

differentiated between "power over" and "power with," and postulated
insightful ideas on negotiation, conflict resolution and power sharing which
helped shape modern management theory.
MARY PARKER FOLLET PART-2
The Mary Parker Follett Theory of Management is marked by such
principles as the following:

 Conflict resolution through Integration (i.e., identifying and meeting each party's
underlying and often compatible need, as opposed to attempting to meet the
frequently-incompatible expressed desire of each) often results in a win-win
situation.
 In Mary Parker Follett leadership theory, genuine power is not "coercive"
("power over") but "coactive" ("power with").
 True leaders, according to Follett's theory, "create group power, rather than
expressing personal power.
 What do you

DESIRE?
MASLOW'S HIERARCHY OF
NEEDS
Maslow's hierarchy of needs is a motivational theory in psychology
comprising a five-tier model of human needs, often depicted as hierarchical
levels within a pyramid. From the bottom of the hierarchy upwards, the needs
are: physiological, safety, love, esteem, and self-actualization.
Maslow (1943, 1954) stated that people are motivated to achieve certain
needs and that some needs take precedence over others.
Our most basic need is for physical survival, and this will be the first thing
that motivates our behavior.
Once that level is fulfilled the next level up is what motivates us, and so on
MASLOW’S HIERARCHY
Self-
Actualization
Esteem
Social
Safety
Physiological
 MASLOW’S NEEDS
EXPLAINED
Physiological needs -
PART-1 these are biological requirements for human survival, e.g. air, food, drink,
shelter, clothing, warmth, sleep. If these needs are not satisfied the human body cannot function optimally.
Maslow considered physiological needs the most important as all the other needs become secondary until
these needs are met.

Safety needs - Once an individual’s physiological needs are satisfied, the needs for security and safety
become salient. People want to experience order, predictability and control in their lives. These needs can
be fulfilled by the family and society (e.g. police, schools, business and medical care). For example,
emotional security, financial security (e.g. employment, social welfare), law and order, freedom from fear,
social stability, property, health and wellbeing (e.g. safety against accidents and injury).

Love and belongingness needs - after physiological and safety needs have been fulfilled, the third
level of human needs is social and involves feelings of belongingness. The need for interpersonal
relationships motivates behavior Examples include friendship, intimacy, trust, and acceptance, receiving
and giving affection and love. Affiliating, being part of a group (family, friends, work)
MASLOW’S NEEDS
EXPLAINED PART-2
Esteem needs - are the fourth level in Maslow’s hierarchy - which Maslow
classified into two categories:
(i) esteem for oneself (dignity, achievement, mastery, independence) and
(ii) the desire for reputation or respect from others (e.g., status, prestige).

Maslow indicated that the need for respect or reputation is most important for
children and adolescents and precedes real self-esteem or dignity.

Self-actualization needs - are the highest level in Maslow's hierarchy,

and refer to the realization of a person's potential, self-fulfillment, seeking
personal growth and peak experiences. Maslow (1943) describes this level as
the desire to accomplish everything that one can, to become the most that one
can be.
What kind of person are

YOU?
MCGREGOR’S X & Y THEORY
McGregor believed that managers' basic beliefs have a dominant influence on
the way that organizations are run. Managers' assumptions about the behavior
of people are central to this.

McGregor argued that these assumptions fall into two broad categories -
Theory X and Theory Y.

These findings were detailed in The Human Side of Enterprise, first published
in 1960. Theory X and Theory Y describe two views of people at work and
may be used to describe two opposing management styles.
THEORY X
The traditional view of direction and control Theory X is based on the
assumptions that:

1. The average human being has an inherent dislike of work and will avoid it if
possible.
2. Because of this human dislike of work, most people must be coerced,
controlled, directed, and threatened with punishment to get them to put forth
adequate effort toward the achievement of organizational objectives.
3. The average human being prefers to be directed, wishes to avoid
responsibility, has relatively little ambition, and wants security above all.
THEORY X MANAGEMENT
STYLE
A Theory X management style therefore requires close, firm supervision with
clearly specified tasks and the threat of punishment or the promise of greater
pay as motivating factors.
A manager working under these assumptions will employ autocratic controls
which can lead to mistrust and resentment from those they manage.
McGregor acknowledges that the `carrot and stick' approach can have a place,
but will not work when the needs of people are predominantly social and
egoistic.
Objective is to persuade people to be docile, to do what they are told in
exchange for reward or escape from punishment, is presented as flawed and
in need of re-evaluation.
THEORY Y
The integration of individual and organizational goals Theory Y is based on the assumptions
that:
 The expenditure of physical and mental effort in work is as natural as play or rest. The average human being
does not inherently dislike work. Depending upon controllable conditions, work may be a source of
satisfaction, or a source of punishment.
 External control and the threat of punishment are not the only means for bringing about effort toward
organizational objectives. People will exercise self-direction and self-control in the service of objectives to
which they are committed.
 Commitment to objectives is a function of the rewards associated with their achievement. The most significant
of such rewards, e.g. the satisfaction of ego and self-actualisation needs, can be direct products of effort
directed towards organizational objectives.
 The average human being learns, under proper conditions, not only to accept but to seek responsibility.
Avoidance of responsibility, lack of ambition, and emphasis on security are generally consequences of
experience, not inherent human characteristics.
 The capacity to exercise a relatively high degree of imagination, ingenuity, and creativity in the solution of
organizational problems is widely, not narrowly, distributed in the population
 Under the conditions of modern industrial life, the intellectual potentialities of the average human being are
only partially utilized
THEORY Y-MANAGEMENT
STYLE
Theory Y assumptions can lead to more cooperative relationships between managers and
workers.

A Theory Y management style seeks to establish a working environment in which the

personal needs and objectives of individuals can relate to, and harmonize with, the
objectives of the organization.

In The Human Side of Enterprise McGregor recognized that Theory Y was not a panacea
for all ills.

By highlighting Theory Y, he hoped instead to persuade managers to abandon the limiting

assumptions of Theory X and consider using the techniques suggested by Theory Y.
What motivates

PEOPLE?
ELTON MAYO -
INTRODUCTION
Elton Mayo (1880-1949) is recommended as the Father of Human Relations
School. He introduced human relations approach to management thought.
His contribution to the development of management thought is unique and is
also treated as human relations approach to management.
It was Mayo who led the team for conducting the study at Western Electric's
Hawthorne Plant (1927-1932) to evaluate the attributes and psychological
reactions of workers in on-the-job situations.
CONCLUSIONS FROM
HAWTHORNE EXPERIEMENTS
The amount of work to be done by a worker is not determined by his physical
capacity but by the social norms.

Non-economic rewards play a significant role in influencing the behavior of

the workers.

Generally the workers do not react as individuals, but as members of a group.

Informal leaders play an important part in setting and enforcing the group
norm.
IMPACT ON INDUSTRY
There was a clear-cut cause and effect relationship between the physical work,
environment, the well-being and productivity of the worker.

Also, there was relationship between production and given condition of

ventilation, temperature, lighting and other physical working conditions and
wage incentives

It had been believed that – improper job design, fatigue and other conditions
of work mainly block efficiency
PHASES
Illumination Experiment (1924-27)
Relay Assembly Test Room Experiment (1927)
Mass Interviewing Programme (1928-31)
Bank Wiring Experiment (1931-32)
ILLUMINATION EXPERIMENT
(1924-27)
It was done to determine the effect of different levels of illumination on
workers’ productivity.
In this experiment, two group of female workers were located in separate
rooms, each group performing the same task.
The rooms were equally illuminated with stabilized room temperature,
humidity, etc. Slowly the conditions of work were changed to mark change in
production.
After a period of one-and-a half year, it was concluded that – illumination
doesn’t affect productivity of workers.
RELAY ASSEMBLY TEST ROOM
EXPERIMENT (1927)
This experiment was conducted to observe the effects of various changes in working
conditions on the workers’ output and morale.
MASS INTERVIEWING
PROGRAMME (1928-31)
It was launched to explore the employees’ feelings (i.e., human attitudes
and sentiments) by the worker’s social group (informal organization).
The workers were asked to express freely and frankly their likes and
dislike on the programmes and policies of the management, working
conditions, and behavior of their boss with workers, etc.
After a few days there was a change in the attitude of the workers,
however no reforms were introduced.
That change was seen because of the following reasons:-
The workers thought that the working conditions were changed because of their
complaints.
They also felt that the wages were better although the wage scale remained at the
same level.
A WEIRD PHENOMENON…
After interviewing 21, 126 workers, and analyzing their complaints, it was
found that – there was no correlation between the nature of complaints
and the facts.
The experiment succeeded in identifying the following three aspects:-
Workers feel elated if they were allowed to express freely. They develop a
feeling that the conditions in the environment were changed to the better
although no such change took place.
Subordinates should be allowed to comment freely about their supervisor.
It is difficult to understand the real problems, personal feelings and
sentiments of the workers derived from both an employee’s personal history
and his social situations at work, without appreciating their feelings and
sentiments.