INTRODUCTION TO MANAGEMENT

 MANAGEMENT
 It is an art of doing any kind of work effectively (meeting the deadlines) and
efficiently(max productivity with min effort).

 BARTAR SYSTEM

 It was a system in the primitive past that people used to obey. In this system
people used to exchange the goods instead of buying them with a specific currency. At that
time no currency was invented.

 Management includes the activities of setting the strategy of an organization and

coordinating the efforts of its employees to accomplish its objectives through the application
of available resources such as financial, natural, technological and human resources.

 The term management refers also to those who manage an organization.

 MASS PRODUCTION
 At initial stage a product is introduced and a limited number of product is manufactured
but when the product demand is increased, it is then produced in large numbers, which
is also called bulk production.

 It reduces the cost of a single unit and hence the organization has even more profit
margin.

 Mass production refers to the efficient production of a large number of similar

products.

 VISION
 The final goal or the target that an organization aims to achieve is called vision.

 Vision of an organization never ends. It is always chased by the organization.

 There are two types of vision

 Static vision: (It is the vision in terms of words)

 Real vision: (it is the actual vision of an organization, that is to maximize profit)

 MISSION
 It is the path which is followed by an organization to achieve its vision. (How you
achieve your vision)

 Most of Organizations invent and then innovate to gain customer attention.

 INVENTION: (Creating something that does not exist before )

 INNOVATION: (To enhance the features of the existing product)

 ORGANIZATION
1. Organizations are tools people use to coordinate their actions to obtain
something they desire or value (to achieve their goals).
2. The majority of organizations have one main mission, that is to satisfy human
needs in order to maximize profit.
3. In order to do that organizations either sell goods or sell services or sometimes
both.
4. Organizations are divided in three categories

 Large
Large organizations have more than a hundred employees.

 Medium
Medium organizations have employees ranging from 20-100.

 Small
Small organizations have 10 to 20 employees.

 Structure of organization.
5. Structure of an organization is the hierarchy in which the whole structure

is defined.

6. Organizational structure determines how the power, responsibilities and duties are
assigned, coordinated and controlled and how information flows between the different
levels of management.

7. An organization has a specific objective, and its structure is defined according to its
target.

8. The different levels of management are as follows.

 Top level management

 Medium level management

 Lower level management

 Supervisory level management

9.

10. Organizational structure effects its actions such as, It provides the foundation on
which its operating procedures and routines are based.

11. Structure of an organization depends on organization’s objectives and strategy.

12. There are two types of structures on which an organization could be based.

 Decentralized structure.
 In a decentralized structure, the decision making power is distributed among its
departments and divisions, in this way they may have different degrees of Independence.

 Centralized structure.
In the centralized structure, most of the decision making power is placed at top
layer, it has tight control over its departments and divisions. Usually the head of the
organization is a CEO (Chief Executive Officer). CFO (Chief Financial Officer) and COO (Chief
Operating Officer) report directly to CEO, these make the top layer in most of the
organizational structures.

 PRODUCT
 It is a tangible entity that is made for consumer use and is sold in markets by
organizations.

 An organization sells either products or services to satisfy human needs and desires to
maximize profit.

 It satisfies customer needs and desires in this way the organization maximizes profit.

 SERVICES
 Services are intangible products such as banking, cleaning, insurance, education,
medical treatment etc that an organization provides to its customers.

 DEMAND
 The amount of product and services that consumers wish to purchase at any given price
level is called demand of that product or service.

 To increase the profit, an organization increases the demand by advertising its products.

 MARKETING/ADVERTISEMENT
 It is a tactic that an organization uses to promote its product or services. In other words
it is a technique that is used to propagate awareness over the customers to gain their
attention over the product.

 As a result the demand of the product increases making a positive effect on the profit of
an organization.

 COMPETITION
 Competition is basically rivalry between organizations, in which each seller tries to get
what other sellers are seeking at the same time. Where the market information flows freely,
competition plays a regulatory function in balancing demand and supply.

 PRODUCT LIFE CYCLE

 A new product progresses through a sequence of stages from introduction to
growth, maturity, and decline. This sequence is known as the product life cycle
 Intro Growth Maturity Decline
Cost Max Min Min Max
Price Max Min Min Min
Marketing Max Min Max Min
Demand Min Max Min Min
Sales Min Max Min Min
Competition Min Max Max Min

 Some companies build products that never go to maturity and are trending for ever.
These kind of products are in continuous growth and these products get innovation
after a certain period of time.

 FUNCTIONS OF MANAGEMENT
 PLANNING

 Where we are
Sales/revenue
 Goal
- Cost/expense
 Vision
Gross profit
 Mission
- Administrative cost
 Profit
- Tax
 Sales Net profit
 Revenue

 Products and services being offered

  Resources

Human resources (how many people we have in our company)

 capital (how much money is used)

 What we have

 Human resources

 Investment

 Where we want to be

 Increased profit

 Increased productivity

 Increased revenue

 Ultimate organization

 How we will be there

 Marketing

 Advertisement of the product and services

 New products and services

 ECONOMIC LIFE CYCLE

 . GOVERNMENT
Rules and regulations roads Rules and regulations

Hospitals

education

etc…

Taxes (Infrastructure) Taxes

(Production) Salary, revenue/sales

ORGANIZATIONS CONSUMERS

(FIRMS AND COMPANIES) Jobs

buy products and services

 ORGANIZING
 STAFFING/LEADING

 CONTROLLING

 ENVIRONMENT
 Organizational environments are composed of forces or institutions surrounding an
organization that affect performance, operations, and resources.

 INTERNAL ENVIRONMENT
 Internal environment refers to the environment that exist inside the organization.

 Following are the components of internal environment of the organization.

 Number of employees

 Productive services

 Resources ( labs, offices,working tools, etc)

 Revenue/Earning

 Finance

 Culture ( e.g: 8 working hours from 8:00 am )

 ( Strong culture: employees are not disturbed. On other words employees are
not so restricted.)

 ( Weak culture: employees are too much restricted and are very much under
pressure. )

 (Mixed culture: employees are under limited restrictions. But also given
freedom)

 EXTERNAL ENVIRONMENT
 External environment is the environment outside the organization.

 ECONOMIC FACTORS

 Interest rate (i %):(An interest rate is the amount of interest due per period, as a
proportion of the amount lent, deposited or borrowed)

 Inflation:(No increase in income while expenses increase constantly )

 Salary fluctuations:(After a certain amount of period the currency rate changes, so

to overcome this change the salaries are fluctuated)

 Stock market fluctuations:(Stocks in stock market are the packets of shares that an
organization sells. While the shares are the collection of stocks)

 Business cycle fluctuations:(The business cycle, also known as the economic cycle
or trade cycle, is the downward and upward movement of gross domestic product
around its long-term growth trend)
 DEMOGRAPHICS
 Population

 Age

 Race

 Gender

 Education level

 Geographic location

 POLITICAL LEGAL COMPONENTS

 Federal

 Local

 Static laws

 Global laws

 Laws of other countries

 SOCIO CULTURAL COMPONENTS

 Culture

 Trends

 Traditions

 Life style

 Taste