Limitations of Planning

Difficulty of Accurate Premising

Problems of Rapid Change

Internal Inflexibilities
(i) Psychological Inflexibilities
(ii) Policy and Procedural Inflexibilities
(iii)Capital Investment
 External Inflexibilities
(i)Political Climate
(ii)Trade Unions
(iii)Technological Changes

Time and Cost factors

Failure of People in Planning

 Making Planning Effective
Establishing Climate for Planning
Initiative at Top Level
Participation in Planning Process
Communication of Planning Elements
Integration of Long-term & Short-term
Plans
An Open Systems Approach
Management By Objectives
A Process whereby the superior &
subordinate managers of an
organization jointly identify its
common goals, define each
individuals major areas of
responsibility in terms of results
expected of him, and use these
measures as guides for operating
the unit and assessing the
contribution of each of its
members.
Features of MBO
Operational Technique
Comprehensive Technique
Participative Management
Result Oriented
Systems Approach
Concentration on Key Result Areas
Steps in MBO
Setting of Organizational Objective
Formulation of Departmental
Objectives
Establishing Goals or Target of
Subordinates
Establishing Check-Points
Appraisal of Performance and
Counselling
Difficulties in MBO
Difficulty in setting Quantitative
Targets
Emphasis on Short-term Goals
Resistance to Change
Lack of Training
Lack of Follow-up
Rigidity
Limited Application
Costly Process
Effective Implementation of
MBO
Top Management Support
Education about MBO
Active Participation in Goal Setting
Decentralization of Authority
Orientation of Executives
Integration of MBO Programme
Role of Organizational
Structure
FacilitatingManagement Action
Encouraging Efficiency
Communication
Optimum use of Organizational
Resources
Stimulating Creativity
Job Satisfaction
 Features of Good Organization Structure
Simplicity
Flexibility
Clear Line of Authority
Application of Ultimate Responsibility
Proper Delegation of Authority
Minimum Possible Managerial Levels
Principles of Unity of Direction & Command
Proper Emphasis on Staf
Provision for Top Management
.
.
 ORGANISATIONAL DIAGNOSIS
1. Profit

- +
2. Growth
3. Customer satisfaction
4. Employee Satisfaction
Dead Healthy

- +
SIX DANGER SIGNALS + - 1. Profit
Negative Profit 2. Growth
Declining Market Share 3. Customer satisfaction
Sick Coercive

Deterioration of physical 4. Employee demoralisation

facilities
Over staffing, high turnover
of employees and low moral - +
Uncompetitive products or
services
Mismanagement
Authority Defined
Authorityis the legitimate right to
give orders and get orders
obeyed.

Authorityis the power to make

decisions which guides actions of
another.
 FEATURES
There is existence of right in authority.
The right of giving order is legitimate.
Authority gives right decision making.
The basic objective behind the use of
authority is to influence the behavior
of subordinates.
The use of authority is determined by
the personality factors of its
possessor.
SOURCES OF
AUTHORITY
The Formal Authority Theory.
Authority is viewed as organizing at the top of
an organizational hierarchy and flowing
downward through a process of delegation.
Acceptance Theory :
The degree of efective authority possessed by
a manager is measured by the willingness of
subordinates to accept it.
Competence Theory :
Authority is generated by personal competence
special knowledge or skill.
 LIMITS OF AUTHORITY
The authority must be exercised keeping
in view the groups fundamental social
beliefs , codes, hobbies .
There is a biological limits of authority.
There are limitations which restrict
managerial authority i.e. factory act etc.
A managers authority is limited due to
span of management.
A manager can use his authority which is
specifically delegated to him.
RESPONSIBILITY
Responsibility is a duty or activity
which a subordinate has to
perform. It is the obligation to
perform the work assigned to him.
ACCOUNTABILITY
Itis liability for proper discharge of
duties by the subordinates.
DELEGATION OF
AUTHORITY
Delegationof authority is the
process through which a manger
gives authority to others in order to
accomplish certain assignments.
 CHARACTERISTICS
Itis authorization to a manger to act in
certain way independently.
Delegation has dual characteristics.
Authority once delegated can be
enhanced, reduced or withdrawn.
A manager cannot delegate authority
which he himself does not possess.
Delegation may be specific or general,
written or unwritten.
Delegation is an art.
 Blocks to Effective
Delegation
A superior does not delegate because of love of his
authority.
The personality factors of superior determine the
degree of delegation.
Manager do not delegate adequately because of
fear of being exposed.
Manager who move up the managerial hierarchy
from below want to make decisions.
Managers can assign their duties to subordinates
but not responsibility.
The attitudes of managers that subordinates are
not capable.
Superior managers may feel that their subordinates
do not require much authority.
 MAKING DELEGATION
EFFECTIVE
The authority and responsibility of
managers should be clearly defined.
States symbols to the managers.
Work climate free from fear and
frustration .
Authority delegation should be tied will
intelligent planning.
Proper control technique should be
developed.
The managers should be trained
adequately to share responsibility and
authority.
Free and open line communication.
CENTRALISATION &
DECENTRALISATION

Centralization is the systematic &

consistent reservation of authority at
central points within the organization.

Decentralization
is more democratic
greater freedom of spirit and less
authoritarian.
FOUR ALTERNATIVE
ARRANGEMENTS
CentralizedAdministration.
Limited decentralization.
Delegated authority.
Bottom up-administration
MEASUREMENT OF DEGREE
OF DECENTRALISATION
Number of Decision .
Importance of Decision
Decision afecting more functions
are made at lower level.
Checking of decision.
BENIFITS OF
CENTRALISATION
Facilitatingpersonal leadership.
Providing integration.
Uniformity of action.
Handling emergencies.
Minimization of duplications of
work.
 BENEFITS OF
DECENTRALISATION
Reduces burden of top executives.
Facilitates decentralization and
diversification .
Ensuring innovation.
Motivates managers.
Encourages development of mangers.
Minimizing levels of organization.
Better coordination of activities.
MAKING DECENTRALISATION
EFFECTIVE
Centralized top policy formulation
and control.
Appropriate control techniques.
Competition among units.
Understanding decentralization.
Development of managers.
Conflict between Line & Staff

Lines Viewpoint

Undermining of Line Authority

Academic Approach of Staf
Lack of Accountability
Limited Outlook of Staf
Stealing of Credit
Staffs Viewpoint

Ignoring the Staf

Resistance to New Ideas
Lack of Enough Authority
Improving Line- Staff
Relationships
The line of demarcation between line & staf
authority should be clear.
Qualified & trained personnel should be
placed on staf positions.
Line managers should give due
consideration to the staf advice.
Line & staf people should operate in terms
of policies & objectives of the whole
organization.
The staf men should appreciate the
difficulties in implementing the new ideas.