NOTES SUBJECT: MANAGEMENT FUNDAMENTALS MBA-I(10 LECTURES) WHAT IS ORGANIZATION AND MANAGEMENT?

An organization is a group of people working together in a structured and coordi nated fashion to achieve a set of goals. (Ricky W. Griffin, Management 7th Editi on, Houghton Mifflin Book Company, Boston, USA) Organization is a systematic arrangement of people to accomplish some specific p urpose. (Stephen P. Robbins and Mary Coulter, Management, 5th Edition, Prentice Hall of India Ltd) Organization implies a formalized intentional structure of roles or positions. ( Heinz Weihrich and Harold Koontz, Management: A Global Perspective, 11th Edition , Tata McGraw-Hill Book Company, India.) An organization is a group of two or more people that exists and operates to ach ieve clearly stated, commonly held objectives. (Straub and Attner, Introduction to Business, Kent publishing, 2004.p. 9109.) From the above definitions it is clear to us that people create organizations to help achieved some pre -specific objectives or purposes. WHAT IS MANAGEMENT? Management in all business and human organization activity is simply the act of getting people together to accomplish desired goals and objectives. Management c omprises planning, organizing, staffing, leading or directing and controlling an organization (a group of one or more people or entities) or effort for the pur pose of accomplishing a goal. Resources encompasses the deployment and manipulat ion of human resources, financial resources, technological resources, and natura l resources Some people define management as managing people tactfully. People are the most valuable resources used by any organization. Others defined it as getting things done throughout the effort of other people. Here we are citing some definitions of eminent writers on management: Management is the process aimed at accomplishing organizational objectives by: I ) effectively coordinating the procurement, allocation, and utilization of human , physical resources of the organization; and 2) maintaining the organization in a state of dynamic equilibrium with the environment. This definition plays impo rtant on two aspects namely, coordinating among different resources and maintain ing harmony with the environment in which the organization is continuing its ope rations.( Arvind V. Phatak, International; Dimensions of Management, The Kent In ternational Business Series, PWS-KENT PUBLISHING COMPANY, BOSTON, USA) Management is the process of efficiently getting activities completed with and t hrough other people. The management process includes the planning, organizing, l eading and controlling activities that take place to accomplish objectives (Davi d A. DeCenzo and Stephen P. Robbins, Personnel/HRM 3rd Ed, Prentice-hall of Indi a). Management can be defined as a set of activities (including planning and decisio n making, organizing, leading, and controlling) directed at an organizations reso urces (human, financial, physical and information) with the aim of achieving org anizational goals in an efficient and effective manner. (Ricky W. Griffin, Manag ement, 7th Edition, Houghton Mifflin Book Company , Boston, USA)

The term management refers to the process of getting activities completed effici ently and effectively with and through other people. (Stephen P. Robbins and Mar y Coulter, Management, 5th Edition, Prentice Hall of India Ltd) Management is the process undertaken by one or more individuals to coordinate th e activities of others to achieve results not possible by one individual acting alone. (DONNELY, GIBSON, IVANCRVICH, MANAGEMENT) Management is the process of working with and through others to achieve organiza tional objectives in a changing environment. Central to this process is the effe ctive and efficient use of limited resource. Five components of this definition requires close examination: 1) working with and through others, 2) achieving org anizational objectives, 3) balancing effectiveness and efficiency, 4) making the most of limited resources and 5) coping with a changing environment (ROBERT KRE TNER, Management, 7th Edition, A.I.T.B.S. PUBLISHERS AND DISTYRIBUTORS, NEW DELH I, INDIA) Management is the process of designing and maintaining an environment in which i ndividuals, working together in groups, efficiently accomplish selected aims.( ( Heinz Weihrich and Harold Koontz, Management: A Global Perspective, 11th Edition , Tata McGraw-Hill Book Company, India) The basic definition needs to be expanded: As managers, people carry out the managerial functions of planning, organizing, staffing, leading and controlling. Management applies to any kind of organization. It applies to managers at all organizational levels. The aim of all managers is the same: to create a surplus. Managing is concerned with productivity, which implies effectiveness and efficiency. PRODUCTIVITY, EFFICIENCY AND EFFECTIVENESS: What is Productivity? In a general sense, productivity is an economic measurer of efficiency that summ arizers the value of outputs relative to the value of the inputs used to create them. Productivity can be and often is assessed at different levels and in diff erent forms. Successful companies create a surplus through productive operations . Although there is no complete argument on the true meaning of productivity, le t us define it as the input-output ratio within a time period with due considera tion for quality. Productivity is a measure of how much value individual employe es add to the goods or services that the organization produces. The greater the output per individual, the higher the organizations productivity. (Louis R. Gomez -Mejia and others, Managing Human Resources, Prentice Hall India, 3rd Edition, N ew Delhi.) Productivity is doing more with less. ( Michael Le Boeuf, The Productivity Chall enge ( New York: McGraw-Hill, 1982), p.8 Productivity is the efficiency with which outputs are produced-the ration of out put to input.( Charles E. Craig, and R. Clark Harris, Total Productivity at the F irm Level, Sloan Management Review, Spring1973,pp.13-19. Productivity designates how efficiently a business uses its resources. Le Boeuf, Productivity Challenges, pp.9-10.) Productivity can be defined in simple terms as any ratio of output to one or mor e corresponding inputs. The unit of output can be anything-dollars, units of products, customers served,

patient treated or whatever is meaningful to the job or organization. (Ivancevi ch & others, Fundamentals of Management, fifth edition, p.49) Productivity can be expressed as follows: Productivity =Output/Input (with a time period, quality considered) This formula indicates that productivity can be improved a) by increasing output s with the same inputs, b) by decreasing inputs but maintaining the same output, or c) by increasing output and decreasing inputs such as labor, materials, and capital. Total factor productivity combines various inputs to arrive at a compos ite input. In the past, productivity improvement program were mostly aimed at th e worker level. Yet, as P. F. Drucker, one of the most prolific writers in manag ement observed, The greatest opportunity for increasing productivity is surely t o be found in knowledge work itself and especially in management. WHAT IS EFFICIENCY AND EFFECTIVENESS? Efficiency is a vital part of management. It refers to the relationship between inputs and outputs. If you can get more outputs from the given inputs, you have increased efficiency. Since managers deal with input resources that are scarce-m ainly people, money, and equipment they are concerned with efficient use of these resources. Management, therefore, is concerned with minimizing resource costs. Efficiency refers to as doing things right. However, it is not enough simply to be efficient. Management is also concerned w ith getting activities completed; that is, it seeks effectiveness. When managers achieve their organizations goals, we say they are effective. Effectiveness can be described to as doing the right things. So efficiency is concerned with means and effectiveness with ends. By efficient, we mean using resource wisely and in a cost-effective manner. For example, if a corporation like Square Pharmaceutical can produce high quality dr ugs at relatively low cost it is efficient. By effective, we mean making the right decisions and successfully implementing t hem. If a firm can produce high quality product that are inspired by customers i s effective. Effectiveness entails promptly achieving a stated objective. While, efficiency, enters the picture when resources required to achieve an objective are weighted against what was actually accomplished. The more favorable the ration of benefit s to costs, the greater the efficiency. (ROBERT KRETNER, Management, 7th Edition , A.I.T.B.S. PUBLISHERS AND DISTYRIBUTORS, NEW DELHI, INDIA) Efficiency denotes most effective use of societys resource in satisfying people w ant and needs. ( Samuelson) Effectiveness denotes right use of societys resources. ( Samuelson) Effectiveness refers to the achievement of objectives. Effectiveness is achieving objectives (ends) with the least amount of resources.

Efficiency and effectiveness are interrelated. For instance, it is easier to be effective if one ignores efficiency. A company can produce more accurate and att ractive products if it disregarded labor and material input costs. In Bangladesh , we often criticize our bureaucrats on the ground that they are effective but e xtremely inefficient; that is, they get their jobs done but at a very high cost. Management is concerned, then, not only with getting activities completed but a lso with doing so as efficiently as possible.

Organizations, on the other hand, can be efficient but not effective. By doing t he wrong things well an organization can be efficient. Many private universities in Bangladesh have become highly efficient in processing students. By using com puter-assisted learning, large lecture classes, and heavy reliance on part time faculty, administrators have significantly cut the cost of educating each studen t. But the quality of the students after graduating from these private universit ies is not beyond question. Of course, high efficiency is associated more typica lly with high effectiveness. And poor management is often due to both inefficien cy and ineffectiveness. Or to effectiveness achieved through inefficiency. In general, successful organizations are both efficient and effective. Managerial Functions: The function of managers provides a useful structure for organizing management k nowledge. Managerial functions are general administrative duties that need to be carried o ut in virtually all productive organizations. Many management writers defined ma nagement from the context of functions performed by managers. Henri Fayol, a Fre nch industrialist turned writer, became the father of the functional approach in 1916 when he identified five managerial functions: planning, organizing, comman d, coordination and control. Fayol claimed that these five functions were the co mmon denominators of all managerial jobs, whatever the purpose of the organizati on. Later on management scholars classified managerial functions from their won point of views. ROBERT KRETNER, identified eight functions as managerial functio ns and these are: PLANNING: Commonly referred to as the primary management function, planning is t he formulation of future courses of action. Plans and objectives on which they base d give purpose and direction to the organization, its subunits, and contributing individuals. Planning involves selecting missions and objectives as well as the actions to achieve them; it requires decision making, that is, choosing future courses of action from among alternatives. DECISION MAKING: Managers choose among alternative courses of action when they m ake decisions. Making intelligent and ethical decisions in todays complex world is a major management challenge. ORGANIZING: Structural considerations such as the chain of command, division of labor, and assignment of responsibility are part of the organizing function. Careful organi zing helps ensure the efficient use of human resources. Organizing is that part of managing which involves establishing an international structure of roles for people to fill in an organization. STAFFING: Organizations are only as good as the people in them. Staffing consist s of recruiting, training, and developing people who can contribute to the organized effort. Stff ing involves filling and keeping filled, the positions in the organization struc ture. COMMUNICATING: Todays managers are responsible for communicating to their employe es the technical knowledge, instructions, rules and information required to get the job done. Recognizing that communication is two-way process, managers should be responsive to feedback and upward communications. MOTIVATING: An important aspect of management today is motivating individuals to pursue

collective objectives by satisfying needs and meeting expectations with meaningf ul work and valued rewards. LEADING: Managers become inspiring leaders by serving as role models and adaptin g their management styles to the demands of the situation. The idea of visionary leaders hip is popular today. Leading is the influencing people so that they will contri bute to organizational and group goals; it has to do predominantly with interper sonal aspect of managing. CONTROLLING: When managers compare desired results with actual results and take necessary corrective action, they are keeping on track through the control function. Devia tions from the past plans, should be considered when formulating new plans. Cont rolling is measuring and correcting individual and organizational performance to ensure that events conform to plans. Coordination, the Essence of Managership: Some authorities consider coordination to be a separate function of the manager. It seems more accurate, however, to regard it as the essence of managership; fo r achieving harmony among individual efforts toward the accomplishment of group goals. Each of the managerial function is an exercise contributing to coordinati on. Even in the case of a church or a fraternal organization, individuals often inte rpret similar interest in different ways, and their efforts toward mutual goals do not automatically mesh with the efforts of others. It thus becomes the centra l task of the manager to reconcile differences in approach, timing, effort, or i nterest and to harmonize individual goals to contribute organizational goals. BASIC MANAGERIAL ROLES: Regardless of their level or area within an organization, all managers must play certain roles if they are to be successful. The concept of a role, in this sens e, is similar to the role an actor play in a theatrical production. A person doe s certain things; meet certain needs in the organization and has certain respons ibilities. To run an organization whatever the type may be, in a effective and e fficient manner they must play certain roles in their respective organizations. Some people defined role, as A role is a set of expectations of managers behavior. Robbins defined roles as specific categories of managerial behavior. While SKINN ER defined role as a set of expected behaviors. Attner on the other hand defined role, as A role is any of several behaviors a manager displays as he or she func tions in the organization. In the late1960s, Henry Mintzberg of McGill University did a careful study of fi ve chief executives in work. He closely observed the day-to-day activities of a group of CEOs by literally following them around and taking notes on what they d id. From this observation Mintzberg concluded that managers play ten different b ut highly interrelated roles and these roles fall into three basic categories: i nterpersonal, informational and decisional. The basic managerial roles are shown in the following table: Category Role Sample activities

Interpersonal Figurehead Leader Liaison Attending ribbon-cutting ceremony for new plant Encouraging employees to improve productivity Coordinating activities of two projects groups Informational

Monitor Disseminator Spokesperson Scanning industry reports to stay abreast of developments Sending memos outlining new organizational initiatives Making a speech to discuss growth plans Decisional Entrepreneur Disturbance handler Resource allocator Negotiator Developing new ideas for innovation Resolving conflicts between two subordinates Reviewing and revising budget requests Reaching agreement with a key supplier or labor union Table: Ten Basic Managerial Roles, Research by Henry Mintzberg. Interpersonal Roles: All managers are required to perform duties that are ceremonial and symbolic in nature-interpersonal roles. When the president of a college hands out diplomas a t commencement, he or she is acting in a figurehead role. All managers have lead er roles. Because, all managers are also leaders. This role includes hiring, tra ining, motivating and disciplining employees. The third role is liaison role. In the word of Mintzberg, this role implies contacting external sources who provid e the manager with information. Informational Role: All managers, to some degree, fulfill informational roles -receiving and collect ing information from organizations and institutions outside their own. The infor mational role typically flows from interpersonal role. The first informational r ole is that of monitor, one who actively seeks information that may be of value. The manager is also a disseminator of information, transmitting relevant inform ation back to others in the workplace. When they represent the organization to o utsiders, managers also perform a spokesperson role. For example, a plant manage r of ACME Pharmaceuticals when transmits information to ACME head office executi ves so that they will be better informed about the activities of the plants activ ities. Decisional Roles: Sometimes it is said that management means decision -making. Managers have to ma ke choices from different alternatives available to hum/her, which will best fit the organization. As entrepreneurs, managers initiate and oversee projects that will improve their organizations performance. As entrepreneur managers have to i nitiate change. As disturbance handler, managers take corrective action in respo nse to previously unforeseen problems. Managers are required to handle such prob lems as strikes, copyright infringements, or problems in public relations or cor porate image. As resource allocator, managers are responsible for allocating hum an, physical, and monetary resources. Managers decide how resources are distribu ted, and with whom he or she will work most closely. Last, managers perform a ne gotiator role when they discuss and bargain with other groups to gain advantages for their own units. In this role, managers enter into negotiation with other g roups or organizations as a representative of the company. These include a union contract, an agreement with a consultant, or a long- term relationship with a s upplier. MANAGEMENT SKILLS: Skills allow individuals to perform activities and to function in society. A man agement skill is the

ability to use knowledge, behaviors and training, and aptitudes to performing a task (SKINNER & IVANCEVICH: 1992). During the early 1970s, research by Robert L. Katz found that managers need three essential skills or competencies: technical , human and conceptual. In addition to fulfilling numerous roles, mangers also n eed a number of specific skills if they are to succeed. The most fundamental man agement skills are technical, interpersonal, conceptual, diagnostic, communicati on, decision-making, and time management skills. Technical Skills: Technical skills include knowledge about methods, processes and equipments for c onducting the specialized activities of the managers organizational unit. Technic al skills also include factual knowledge about the organization (rules, structur e, management systems, employee characteristics) and knowledge about the organiz ations products and services (technical specifications, strengths, and limitation s). This type of knowledge is acquired by a combination of formal education, tra ining, and job experience. Effective managers are able to obtain information and ideas from many sources and store it away in their memory for use when they nee d it. Technical skills are those involved in making a product or providing a ser vice (SKINNER & IVANCEVICH: 1992). Technical skill is the knowledge of and abili ty to use the processes, practices, techniques, or tools of a specialty responsi bility area. (Straub and Attner, Introduction to Business, Kent publishing, 2004 .p. 96.) Technical skills are necessary to accomplish or understand the specific kind of work being done in an organization. Technical skills are especially imp ortant for first line managers. The managers spend much of their time training s ubordinates and answering questions about work-related problems. They must know how to perform the tasks assigned to those they supervise if they are to be effe ctive managers. Technical skill refers to a persons knowledge and ability in any type of process or technique. Examples are the skills learned by accountants, En gineers, Word Processing operators and toolmakers. Human Skills/Interpersonal skills: Interpersonal skills (or social) skills include knowledge about human behavior a nd group processes, ability to understand the feelings, attitudes, and motives o f others and ability to communicate clearly and persuasively. Specific types of interpersonal skills such as apathy, social insight, charm, tact, and diplomacy, persuasiveness and oral communication ability are essential to develop and main tain cooperative relationships with subordinates, superiors, peers, and outsider s. Someone who understands people and is charming, tactful, and diplomatic will have more cooperative relationship than a person who is insensitive and offensiv e. Human relations skills involve relating and interacting with subordinates, pe ers, superiors, and customers or clients (SKINNER & IVANCEVICH: 1992). Human ski ll is the ability to interact with other persons successfully. A manager must be able to understand, work with and relate both in dividuals and groups to build a teamwork environment. (Straub and Attner, Introd uction to Business, Kent publishing, 2004.p. 97.) Human skill is the ability to work effectively withy people and to build teamwork. In the other words it is th e ability of a person to work well with other people both individually and in gr oups. Since managers deal with people, this skill is crucial. Managers have to s pend considerable time interacting with people both inside and outside the organ ization. For obvious reasons, then, managers also need interpersonal skill the ab ility to communicate with, understand and motivate both individuals and groups. Conceptual Skills: In general terms, conceptual (or cognitive) skills involve good judgment, foresi ght, intuition, creativity, and the ability to find meaning and order in ambiguo us, uncertain events. Specific conceptual skills that can be measured with aptit ude test include analytical ability, logical thinking, concept formation, induct ive reasoning, and deductive reasoning. Conceptual skills are the managers ability to organize and integrate information to better understand the organization as a whole (SKINNER & IVANCEVICH: 1992). C

onceptual skill deals with ideas and abstract relationships. It is the mental ab ility to view the organization as a whole and to see how the,parts of the organi zation relate to and depend on one another. In addition, conceptual skill is the ability to imagine the integration and coordination of the parts of an organiza tion- all it processes and systems. (Straub and Attner, Introduction to Business , Kent publishing, 2004.p. 97.)Conceptual skills depend on the managers ability t o think in the abstract. They must be able to see the organization as a whole an d the relationships among its various subunits and to visualize how the organiza tion fits into broader environment. Conceptual skill is the ability to think in terms of models, frameworks, and broad relationships, such as long range plans. These conceptual skills allow managers to think strategically, to see the big pic ture, and to make broad-based decisions that serve the organization. These types of conceptual skills are needed by all managers at all levels but become more im portant as they move up the organizational hierarchy. Diagnostic Skills: Successful managers also posses diagnostic skills or skills that enable a manage r to visualize the most appropriate response to a situation. This skill is as li ke the skill of a physician who diagnoses a patients illness by analyzing symptom s and determining their probable causes. Communication Skills: Communication skill is now a day considered to be an important skill of successf ul managers. Communication skills refer to the managers abilities both to convey ideas and information effectively to others and to receive ideas and information effectively from others. These skills enable a manager to transmit ideas to sub ordinates so that they know what is expected, to coordinate work with peers and colleagues so that they work together properly, and to keep higher -level manage rs informed about what is going on. Decision-Making Skills: Management means decision-making. Decision-making skills refer to the managers ab ility to recognize and define problems and opportunities correctly and then to s elect an appropriate course of action to solve problems and capitalize on opport unities. No managers make right decision all the time. However, effective manage rs make good decisions most of the time. And when they do make a bad decision, t hey usually recognize their mistake quickly and then make good decisions to reco ver with as little cost or damage to their organization as possible. Management hierarchy: Senior management (or "top management" or "upper management") Middle management Lower-level management, such as supervisors or team-leaders Top-level management Require an extensive knowledge of management roles and skills. They have to be very aware of external factors such as markets. Their decisions are generally of a long-term nature Their decisions are made using analytic, directive, conceptual and/or behavioral /participative processes They are responsible for strategic decisions. They have to chalk out the plan and see that plan may be effective in the future . They are executive in nature. Middle management o Mid-level managers have a specialized understanding of certain manageria l tasks. o They are responsible for carrying out the decisions made by top-level ma

nagement. Lower management o This level of management ensures that the decisions and plans taken by t he other two are carried out. o Lower-level managers decisions are generally short-term ones. Principles of Management: The Principles of Management are the essential, underlying factors that form the foundations of successful management. According to Henri Fayol (1841-1925) in h is book General and Industrial Management (1916), there are fourteen principles of management . The Principles of management Management principles are statements of fundamental truth. These principles serv e as guidelines for decisions and actions of managers. They are derived through observation and analysis of events which managers have to face in practice. 1. Division of Work The specialization of the workforce, creating specific personal and professional development within the labour force and therefore increasing productivity; lead s to specialization which increases the efficiency of labour. By separating a sm all part of work, the workers speed and accuracy in its performance increases. T his principle is applicable to both technical as well as managerial work. 2. Authority and ResponsibilityThe issue of commands followed by responsibility for their consequences. Authori ty means the right of a superior to give order to his subordinates; responsibili ty means obligation for performance. This principle suggests that there must be parity between authority and responsibilty.. They are co-existent and go togethe r, and are two sides of the same coin. 3. DisciplineDiscipline refers to obedience, proper conduct in relation to others, respect of authority, etc. It is essential for the smooth functioning of all organizations. 4. Unity of Command This principle states that every subordinate should receive orders and be accoun table to one and only one superior. If an employee receives orders from more tha n one superior, it is likely to create confusion and conflict. Unity of Command also makes it easier to fix responsibility for mistakes. 5. Unity of Direction All those working in the same line of activity must understand and pursue the sa me objectives. All related activities should be put under one group, there shoul d be one plan of action for them, and they should be under the control of one ma nager. It seeks to ensure unity of action, focusing of efforts and coordination of strength. 6. Subordination of Individual Interest The management must put aside personal considerations and put company objectives first. Therefore the interests of goals of the organization must prevail over t he personal interests of individuals. 7. Remuneration Workers must be paid sufficiently as this is a chief motivation of employees and therefore greatly influences productivity. The quantum and methods of remunerat ion payable should be fair, reasonable and rewarding of effort. 8. The Degree of Centralization The amount of power wielded with the central management depends on company size. Centralization implies the concentration of decision making authority at the to p management. Sharing of authority with lower levels is called decentralization. The organization should strive to achieve a proper balance. 9. Scalar Chain Scalar Chain refers to the chain of superiors ranging from top management to the lowest rank. The principle suggests that there should be a clear line of author ity from top to bottom linking all managers at all levels. It is considered a ch

ain of command. It involves a concept called a "gang plank" using which a subord inate may contact a superior or his superior in case of an emergency,defying the hierarchy of control.However the immediate superiors must be informed about the matter 10. Order Social order ensures the fluid operation of a company through authoritative proc edure. Material order ensures safety and efficiency in the workplace. 11. Equity Employees must be treated kindly, and justice must be enacted to ensure a just w orkplace. Managers should be fair and impartial when dealing with employees. 12. Stability of Tenure of Personnel The period of service should not be too short and employees should not be moved from positions frequently. An employee cannot render useful service if he is rem oved before he becomes accustomed to the work assigned to him. 13. Initiative Using the initiative of employees can add strength and new ideas to an organizat ion. Initiative on the part of employees is a source of strength for the organiz ation because it provides new and better ideas. Employees are likely to take gre ater interest in the functioning of the organization. 14. Esprit de Corps This refers to the need of managers to ensure and develop morale in the workplac e; individually and communally. Team spirit helps develop an atmosphere of mutua l trust and understanding. These can be used to initiate and aid the processes o f change, organization, decision making, skill management and the overall view of the management function. Scientific management Taylor believed that the industrial management of his day was amateurish, that m anagement could be formulated as an academic discipline, and that the best resul ts would come from the partnership between a trained and qualified management an d a cooperative and innovative workforce. Each side needed the other, and there was no need for trade unions. Taylors approach is also often referred to, as Taylo r s Principles, or frequently disparagingly, as Taylorism. Taylor s scientific m anagement consisted of four principles: 1. Replace rule-of-thumb work methods with methods based on a scientific study o f the tasks. 2. Scientifically select, train, and develop each employee rather than passively leaving them to train themselves. 3. Provide "Detailed instruction and supervision of each worker in the performan ce of that worker s discrete task" (Montgomery 1997: 250). 4. Divide work nearly equally between managers and workers, so that the managers apply scientific management principles to planning the work and the workers actually perform the tasks. Managers and workers Taylor had very precise ideas about how to introduce his system: It is only thro ugh enforced standardization of methods, enforced adoption of the best implement s and working conditions, and enforced cooperation that this faster work can be assured. And the duty of enforcing the adoption of standards and enforcing this cooperation rests with management alone. Workers were supposed to be incapable o f understanding what they were doing. According to Taylor this was true even for rather simple tasks. The introduction of his system was often resented by worke rs and provoked numerous strikes. The strike at Watertown Arsenal led to the con gressional investigation in 1912. Taylor believed the labourer was worthy of his hire, and pay was linked to productivity. His workers were able to earn substan tially more than those in similar industries and thisearned him enemies among th e owners of factories where scientific management was not in use.

Management Theories: Scientific Management Theory (1890-1940) At the turn of the century, the most notable organizations were large and indust rialized. Often they included ongoing, routine tasks that manufactured a variety of products. The United States highly prized scientific and technical matters, including carefulmeasurement and specification of activities and results. Manage ment tended to be the same. Frederick Taylor developed the: scientific managemen t theory which espoused this careful specification and measurement of all organiz ational tasks. Tasks were standardized as much as possible. Workers were rewarde d and punished. This approach appeared to work well for organizations with assem bly lines and other mechanistic, routinized activities. Bureaucratic Management Theory (1930-1950) Max Weber embellished the scientific management theory with his bureaucratic the ory. Weber focused on dividing organizations into hierarchies, establishing stro ng lines of authority and control. He suggested organizations develop comprehens ive and detailed standard operating procedures for all routinized tasks. Human Relations Movement Eventually, unions and government regulations reacted to the rather dehumanizing effects of these theories. More attention was given to individuals and their un ique capabilities in the organization. A major belief included that the organiza tion would prosper if its workers prospered as well. Human Resource departments were added to organizations. The behavioral sciences played a strong role in hel ping to understand the needs of workers and how the needs of the organization an d its workers could be better aligned. Various new theories were spawned, many b ased on the behavioral sciences (some had name like theory X, Y and Z). Mary Parker Follett (1868-1933), on the other hand focused more on human relatio ns rather than on scientific type approaches in order to increase production. Fo llett s studies allowed for other theorists to study new areas, including Cheste r I. Barnard (1886-1961). His contribution was the introduction of the informal organization concept. He believed that if properly managed, this could be a powe rful tool in helping the organization achieve its goals (Daft and Marcic, 1998) . POLICIES BUSINESS POLICY Meaning and Definition:Policy-making is one of the most important components of business planning. Poli cies may be defined as the mode of thought and the principles underlying the acti vities of an organization or an institution. Terry says, A business policy is an implied overall guide setting up boundaries t hat supply limits and direction in which managerial action will take place. FEATURES OF BUSINESS POLICY: Policies are a general statement of principles fro the attainment of objectives. Policies have a hierarchy. The policies delimit the area within which a decision is to be made and ensure t hat the decision will be consistent with and contribute to the objectives. Policies in general are meant for mutual application by subordinates. Policies tend to predecide issues, avoid repeated analysis and give a unified st ructure to other types of plans. Policies are found in all functional areas and at various levels within these ar eas. Policies serve an extremely useful purpose. A policy is a positive declaration band a command to its followers. MECHANICS OF POLICY MAKING/ELEMENTS: Identification of the situation. Development of policy. Dissemination of the policy.

Explanation of the policy. Acceptance of the policy. Feed back.

CLASSIFICATION OF POLICIES:1. Classification according to the level of formulation:Business policies are of different levels they are: Top management policies Middle level management policies - upper middle management - middle management lower level management policies operating force policies

2. Classification according to the functional areas:o Production policies o Marketing and sales policies o Financial policies o Personnel policies 3. Classification according to the expression:o Expressed - Oral - Written o Implied 4. Classification according to the nature of origin:o Originated policies o Appealed policies o Imposed policies o Derivative policies o 5. Classification according to the scope of organization:o Basic policies o General policies o Departmental or specific policies 6. Classification according to the nature of management function:o Planning policies o Organizing policies o Actuating policies o Controlling policies TECHNIQUES OF MANAGEMENT MANAGEMENT BY OBJECTIVE: Management by objective (MBO) is known by several names e.g., management by objec tive, Management by goals and results, Goals management etc. In 1954 Peter F. Drucker suggested the concept of Management by objectives and self control. Later several pioneers suggested the use of MBO for performance appraisal, for long-range pla nning and for integrating the individual with the organization. As management ph ilosophy MBO has now become a way of life for business managers. Concept of MBO: MBO has be defined as a process whereby superior and subordinates jointly identi fy the common objectives, set the results that should be achieved by the subordi nates, assess the contributions of each individual in terms of the results expec

ted of him, and integrate individuals with the organization so a to make best us e of organizational resources. The forgoing definition reveals the following characteristics of MBO: 1. MBO is both a philosophy and a technique of management. 2. MBO is a goal-oriented process and not a work-oriented process. 3. Self-direction and self-control are the built-in features of MBO. 4. It lays down an evaluative mechanism through which the contribution of each i ndividual is measured. 5. Under MBO a linkage is created between organizational goals and individual go als. 6. Performance of individual is periodically evaluated in the light of pre-deter mined targets. 7. MBO is a continuous process or a never-ending process. STEPS IN MBO PROCESS: The main steps in the process of MBO are as follows: 1. Setting Objectives: The first step in installing the MBO system is to establi sh verifiable objectives for the organization as a whole and for various positio ns in the organization. Under MBO, objectives are established in several stages. First, top management sets the goals for the total enterprise in certain key ar eas. Second, objectives for each department are laid down in consultation with t he department heads. Then this process of goal-setting is repeated at lower leve ls of management until goals for each and every individual are established. The superior must play a supportive role in helping his subordinates to develop consistent and feasible objectives for themselves. The goal-setting process is complete when agreement is reached between superior and subordinates as to what is to be accomplished and why. 2. Developing action plans: Once the goals are established, responsibility for t he achievement of each goal is specified. Job descriptions for various positions must define the goals to be attained. Resources required for goals attainment a re identified and allocated. Then the means for the implementation of plans are decided. Goals and resources must be matched together. 3. Conducting periodic reviews: At frequent intervals actual performance is revi ewed jointly by the superior and the subordinates. Such periodic evaluation prog ress serves as a checkpoint. If necessary, the goals are modified. Ways and mean s are identified to overcome problems and to improve performance in future. 4. Appraising annual performance: A thorough evaluation of individual performanc e is done at the end of the year. At annual reviews, achievements are carefully analyzed against the given objectives. Rewards are decided on the basis of annua l appraisal. Thus, the MBO process comprises preliminary goal-setting, setting s ubordinates objectives, matching goals with resources, recycling objectives and p eriodic appraisal of performance. MANAGEMENT BY EXCEPTION: 1. SETTING OBJECTIVES 2. DEVELOPING ACTION PLANS 3. APPRAISING ANNUAL PERFORMANCE 4. CONDUCTING PERIODIC REVIEWS It is a management style wherein managers intervene only when their employees fa il to meet their performance standards. If the personnel are performing as expec ted, the manager will take no action. The term is also used to describe provisio n of information to management in which only significant deviations from budgets or plans are reviewed as the basis for corrective action. The object is to redu ce the quantity of detail contained in management reports and statistics to date

on which action can be taken. Advantages o It tters. o It o It o It o It of MBE: saves the time of managers because they deal only with exceptional ma focuses managerial attention on major problems. facilitates delegation of authority. keeps management alert to opportunities and threats. provides better yardstick for judging results.

Limitations of MBE: o Non critical and non exceptional areas may be crucial and may damage the system before remedial action is taken. o Subordinates may misuse the permissive atmosphere. Trends in Management Tourism Management Dynamics As the global tourism industry continues to expand and to become more complex, i t is vital that those in the industry identify trends early and design proactive strategies to gain competitive advantage. Tourism Futures: dynamics, challenges and tools helps one with a comprehensive insight of the changes in the external business environment, and equips them with new managerial techniques and tools in order to adapt and profit from these changes and into the future. It provides the manager of tomorrow with the ability to look beyond normal planning horizon s and identify potential opportunities from change. Quality control method, quality control support system and trend management prog ram for manufacturing operation A product quality control method for a manufacturing operation comprising: stori ng part-by-part data related to equipment used in a manufacturing process in a s torage device using an inputting device; outputting the stored data from the sto rage device via a processing device to an outputting device as a quality mainten ance matrix; measuring characteristic values of a product manufactured by implem enting an inspection and manufacturing operation based on the quality maintenanc e matrix, and additionally storing the obtained characteristic values in the qua lity maintenance matrix; performing factor analysis on a part related to the qua lity characteristic item showing an impermissible characteristic value in the ab ove measurement and setting new conditions so as to improve the impermissible ch aracteristic values and storing the quality maintenance matrix revised by the ne wly set conditions; implementing an inspection and manufacturing operation based on the thus revised quality maintenance matrix prepared in the first step. Brightsizing-new technique in management: Management trends come and go. They are good or bad depending on many variables: industry; company culture; education level of workers; existing contracts and l aws; etc. Mostly, however, they are good or bad depending on how well they are a pplied. Re-engineering is a solid business management tool, but applied incorrec tly it can cause more harm than good. Downsizing, when done improperly, is appro priately called dumbsizing. The latest management buzzword isn t really a trend. It is more a reaction to th e last few trends. The new buzzword is brightsizing. While it provides more oppo rtunity for comic relief, courtesy of Dilbert, it is no laughing matter. Brights izing is downright dangerous and you need to protect your organization from it. Brightsizing is defined, by Paul McFedries, as "corporate downsizing in which th e brightest workers are let go. This happens when a company lays off those worke rs with the least seniority, but its those young workers who are often the best trained and educated." Sometimes brightsizing is blamed on union contracts, which enforce seniority-bas ed hiring/firing practices. It is, unfortunately, just as common in non-union co mpanies. Many companies have policy statements in their employee handbooks that

state that in layoff decisions "among equally qualified candidates preference wi ll be given to the employee with the greatest seniority." When faced with decisions that will result in a reduction in staff, make sure yo u first evaluate the value of the employee to the organization and THEN look at other mitigating factors, such as length of time with the company. STRATEGY:Strategy is the complex plan for bringing the organization from a given posture to a desires position in a future period of time. NATURE OF STRATEGY:Characteristics:Long-term plan provides the directions in which human and physical resources wil l be deployed for achieving organizational goals primarily concerned with expected trends in the markets an interpretative plan is forward looking mainly the job of top management.