Principles of Management.

Dr Tariq uz Zafar
BSc, MBBS, MSc (Hosp Mgt)

Head of Department Healthcare Management Hamdard Institute of Management Sciences, HAMDARD UNIVERSITY, KARACHI

Class 1.

Introduction to Management.

Origin: The verb manage comes from the Italian maneggiare (to handle a horse to train a horse), which in turn derives from the Latin manus (hand). The French word mesnagement (later mnagement) influenced the development in meaning of the English word management in the 15th and 16th centuries. Definition: The process of reaching organisational goals by working with & through people and other organisational resources efficiently and effectively. It has 3 main characteristics: 1. It is a process or series of continuing & related activities. 2. Concentrates on reaching organisational goals. 3. It reaches these goals by working with & through people & other organisational resources. Different usages of the term Management: 1. The process managers follow to accomplish organisational goals. 2. The cumulative body of knowledge that guides us on how to manage. 3. The Individuals who guide & direct organisations. 4. The career devoted to the task of guiding and directing organisations. 5. Since organisations can also be viewed as systems, management can alsos be defined as human action, including design, to facilitate the production of useful outcomes from a system. This view points towards the aspect to manage oneself, a pre-requisite to managing others.

The Management process: Management functions.

Henri Fayol (18411925)[3] considered management to consist of six functions: forecasting, planning, organizing, commanding, coordinating and controlling. The FOUR BASIC MANAGEMENT FUNCTIONS are: Planning, Organising, Influencing and Controlling. Planning: Choosing the tasks that must be performed to attain organisational goals and how and when these tasks should be performed. Planning is essential to getting the right things done. Planning is concerned with both short and long term organisational success. Organising: Assigning the tasks identified in the planning function to various individuals and groups within the organisation. It is the mechanism that puts plans into action. Tasks are organised so that the outputs of individuals contributes to the success of departments. Which then contribute to the success of divisions, which ultimately leads to the success of the organisation. Organising should not be rigid, but adaptable and flexible to meet challenges as circumstances change.

Influencing: motivating, leading, directing, actuating.Guiding the activities of the people within the organisation towards directions that help in attaining the goals of the organisation. The goal of influencing is to increase productivity. Human-oriented work situations generate higher levels of production in the long term then do taskoriented work situations, because people find the latter type less satisfying.

Controlling: AN ON-GOING PROCESS that enables Managers to: 1. Gather information that measures recent performance in the organisation. 2. Compare present performance to pre-established performance standards. 3. From this comparison determine whether the organisation should be modified to meet pre-established standards.

Organisational goals

Organising is based on well-thought out plans;Influencing must be tailored to reflect both these plans and the organisational design used to implement them. The controlling func involves possible modifications to the other 3 funcs.

Planning

Influencing

Controlling

Organising

Relationship among the functions of management used to attain Organisational Goals

The Management Task: Effective management is the most important resource of developed countries & the most needed one of developing countries (Drucker). Management positions have increased from 10% of all jobs since 1950 to 18%. People trained in various diverse disciplines like accountants, teachers, financiers., etc, ultimately work as Managers. In the short term, THE DEMAND FOR MANGERS CAN VARY,but in the long term, managerial positions have high salaries, status, interesting work, personal growth and strong self-satisfaction. Compensation paid to Managers:  In 2007 Forbes magazine ranked the Top Ten most highly paid CEOs as Steve Jobs (Apple computers) $646.60 million at #1 and Henry C Duques (First Data) $98.21 million at #10. These figures are for annual compensation that includes salary, bonuses and stock options which are commonly paid to executives. The Top Ten executives are all men: there is a large salary gap b/w men and women executives at all levels (the Glass Ceiling). Are Top Executives paid too much? It has been established that many CEOs are paid more than the value they bring to the firm. International opinion now also focuses on the fact that on the average, the CEOs salary was 400 times that of a production worker.This was often also true of companies where workers were being laid off b/c of down-sizing.
Measures of progress in a Career: just salary? Work satisfaction, social standing & status, personal growth, professional growth.

Management & Organisational Resources Inputs --- Process Outputs Managerial Efficiency: the proportion of total organisational resources that contribute to productivity during the manufacturing process. The higher the proportion,the more efficient the Manager. The more resources wasted or unused during the production process, the more inefficient the Manager. Managerial Effectiveness: Managements use of the organisations resources to reach organisational goals. The Universality of Management: Management principles are universal.
Efficient (most resource contribute To Production)

RESOURCE USE

Not reaching goals & not wasting resources Not reaching

Reaching goals & not wasting resources Reaching goals & not wasting resources

MANAGERIAL EFFICIENCY & MANAGERIAL EFFECTIVENESS

Inefficient goals & (few wasting resource resources contribute toproduction)

Ineffective (little Effective (substantial progress towards progress towards Org goals) Org goals) GOAL ACCOMPLISHMENT

Fayol: the Theory of Characteristics: Managers should possess positive mental and physical qualities and specific knowledge related to the specific operation. Forbes emphasised certain personal qualities like enthusiasm, earnestness of purpose, selfconfidence and faith in their own worthiness. MANAGEMENT SKILL: THE KEY TO MANAGEMENT SUCCESS. Definition: the ability to carry out the process of reaching organisational goals by working with and through people and other organisational resources. Robert L. Katz: 1. Technical skills: Supervisory or operational management 2. Human skills: Middle management 3. Conceptual skills: Top management MANAGEMENT SKILL: A CURRENT VIEW. The current view is an expansion of the Classic view. It involves two logical steps: 1. Defining the major activities that Managers typically perform. 2. Listing the skills needed to carry out those activities successfully. The major activities modern Managers typically perform: 1. Task-related activities: short-term planning, job objectives, monitoring ops & performance. 2. People-related activities: incl training. 3. Change-related activities: monitoring the ext env, strategies, innovative thinking.