Management

“Management is the art of getting things

done through and with the people in
formally organized groups.”
By Koontz H.
 Unifying force

Manpower

Money Material

Management

Methods Machinery
 Functions of Management-

Planning- Process of making decisions about future.

Planning is the process used by managers to identify and select
appropriate goals and courses of action for an organization.
3 steps to good planning :
1. Which goals should be pursued?
2. How should the goal be attained?
3. How should resources be allocated?
◦The planning function determines how effective and efficient
the organization is and determines the strategy of the
organization.
 Provides direction to enterprise.
 Enables managers to measure progress.
 Helps manager to cope with change.

Organizing- arranging of organization’s resources : man, material,

technology and money.
• In organizing, managers create the structure of working
relationships between organizational members that best allows
them to work together and achieve goals.
• Managers will group people into departments according to the
tasks performed.
• Managers will also lay out lines of authority and responsibility
for members.
• An organizational structure is the outcome of organizing. This
structure coordinates and motivates employees so that they
work together to achieve goals.
 Creates structure to cope with problems of growth.
 Defines and arrange work activities.

Staffing- employing suitable persons for the enterprise.

 Recruitment and selection.
 Training and development.
 Motivation
 Compensation
• Directing, guiding and supervising activities of
subordinates.
 Leadership is process of influencing others to act
towards attainment of a goal.
 Motivation is the work a manager performs to inspire
and encourage people to attain a goal.
 Communication is the transfer of information from
one person to another.
Controlling- concerned with monitoring employee’s activities,
keeping the organization on track towards it’s goals and
making corrections as required.
• In controlling, managers evaluate how well the organization is
achieving its goals and takes corrective action to improve
performance.
• Managers will monitor individuals, departments, and the
organization to determine if desired performance has been
reached.
• Managers will also take action to increase performance as
required.
• The outcome of the controlling function is the accurate
measurement of performance and regulation of efficiency and
effectiveness
 Managerial Roles

According to Mintzberg managers must fill many roles-

Interpersonal Role-
1. Figurehead Role-
1. Ceremonial and symbolic duties
- Greeting visitor, attending social functions etc.
2. Leadership Role-
1. Hiring, training, motivating and disciplining.

3. Liaisons Role-
1. Serve as connecting link
2. between their organization and others
Informational Role-

1. Monitor Role-
1. Receiving and communicating information.

 Disseminator Role-
Distributes important information.

 Spokesman-
Transmitting information to people outside the
organization.
Decisional Roles-

1. Entrepreneur-
1. Introduce change, initiate projects to improve
organization.

 Disturbance handler-
Taking charge when organization is threatened.

 Resource allocation-
Allocating human, physical and monetary resources.

 Negotiator-
Manager carry out negotiation with other units to gain
advantage for their own unit.
Managerial Skills-

Four basic skills of managers-

1. Technical Skills-
• ability to use the tools, procedures and technique of
a specialized field.
• Crucial for lower level managers because they are in
direct contact with employees performing work
activities.
• As you go higher there is less importance of technical
skills.
2.Human Skills-
• Ability to work with, understand and motivate other
people.
• Important at all levels but particularly lower level.

3. Conceptual Skills-
• Mental ability to co-ordinate and integrate
organization’s interest and activities.
• Ability to see the big picture. Understand how a
change will effect whole organization.
4.Design Skill
• Ability to solve problems in ways that will help the
organization.
• To design a workable solution to a problem.
 Levels of Management-
Line of demarcation between various managerial
positions.
Top Management
• Determine objectives and policies.
• Design basic operating and financial structure of
organization.
• Provides guidance and direction.
• Lays down standards of performance.
• Maintains good public relation.
Middle Management
• Interprets and explains policies framed by the top.
• Issues detailed instructions.
• Participates in operating decisions.
• Trains other managers.
Lower Management
• Plans day to day operation.
• Assign job to workers
• Provide supervision and control over work.
• Arranges material, tools and equipment.
• Maintains discipline.
 Case 2 : Steve Jobs at Apple Computers

• 1976 sold Volkswagen & two programmable

calculators to start computer circuit boards from
garage $1,350 investment
• 1985 Apple Computer sales $2 billion
• Management style (favoritism, internal
competition, lack of control systems)
• Asked to resign
• Steve Jobs at Apple Computers..
• Started new ventures “NEXT” – new generation PCs
& PIXAR – Computer animation company
• 1996 – apple acquired NEXT
• 1997 – became CEO of Apple Computers
• Developed a clear mission & lead team successfully
• 2003 onwards launched most innovative products
• iTunes (online music) & iPod (music player), iPad
(tablet PC) and iPhone (mobile) launched
Evolution of Management
 Management Perspectives Over
Time
2000
The Technology-Driven Workplace
1990 2010
The Learning Organization
1980 2010
Total Quality Management
2000
1970
Contingency Views
1950 2000
Systems Theory
2000
1940
Management Science Perspective
1930 1990
Humanistic Perspective
1890 1990
Classical
1940 2010
1870
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 Evolution
Early examples-
• Management in Egypt
• Kautilya’s Arthshastra.
• In Rome craft industry.
• England’s industrial revolution in 1750.
 Job Specialization and
the Division of Labor
Adam Smith (18th century economist)
–Observed that firms manufactured pins in
one of two different ways:
- Craft-style—each worker did all steps.
- Production—each worker specialized in one step.
– Realized that job specialization resulted in much
higher efficiency and productivity
• Breaking down the total job allowed for the division of labor
in which workers became very skilled
at their specific tasks.
 Scientific Management theory
• Modern management began in the late
19th century.
– Organizations were seeking ways to better
satisfy customer needs.
– Machinery was changing the way goods
were produced.
– Managers had to increase the efficiency of
the worker-task mix.
• Defined by Frederick Taylor, late 1800’s.
• The systematic study of the relationships
between people and tasks to redesign the
work for higher efficiency.
– Taylor sought to reduce the time a worker spent
on each task by optimizing the way the task was
done.
Four Principles to increase efficiency:

1. Study the way the job is performed now &

determine new ways to do it.
• Gather detailed, time and motion information.
• Try different methods to see which is best.
2. Codify the new method into rules.
• Teach to all workers.
3. Select workers whose skills match the rules set
in Step 2.
4. Establish a fair level of performance and pay
for higher performance.
• Workers should benefit from higher output.
 Techniques & Elements of Scientific
management
• Scientific work study
1) Method Study
2) Motion study
3) Time study
4) Fatigue study
• Scientific task planning-
1) Routing
2) Scheduling
3) Dispatching
4) Follow up
• Scientific selection and training
• Standardization of work
• Differential piece wage system
• Functional foremanship
 Problems of Scientific Management
• Managers often implemented only the
increased output side of Taylor’s plan.
– They did not allow workers to share in increased
output.
– Specialized jobs became very boring, dull.
– Workers ended up distrusting Scientific
Management.
• Workers could purposely “under-perform”
• Management responded with increased use
of machines.
 The Gilbreth’s
• Frank and Lillian Gilbreth refined Taylor’s
methods.
– Made many improvements to time and motion
studies.
• Time and motion studies:
– 1. Break down each action into components.
– 2. Find better ways to perform it.
– 3. Reorganize each action to be more efficient.
• Gilbreths also studied fatigue problems,
lighting, heating and other worker issues.
 Administrative Management
• Seeks to create an organization that leads to
both efficiency and effectiveness.
• Max Weber developed the concept of
bureaucracy.
– A formal system of organization and
administration to ensure effectiveness and
efficiency.
– Weber developed the Five principles.
 Bureaucratic Principles
Written rules

System of task A Bureaucracy Hierarchy of

relationships should have authority

Fair evaluation
and reward
 Key points of Bureaucracy
Authority is the power to hold people accountable for
their actions.
Positions in the firm should be held based on
performance not social contacts.
Position duties are clearly identified. People should
know what is expected of them.
Lines of authority should be clearly identified.
Workers know who reports to who.
Rules, Standard Operating Procedures (SOPs), &
Norms used to determine how the firm operates.
• Sometimes, these lead to “red-tape” and other
problems.
 Criticism of Bureaucracy
• Over conformity of rules.
• Buck passing
• Displacement of goals
• Rigid structure
 Fayol’s Principles
• Henri Fayol, developed a set of 14 principles:
1. Division of Labor: allows for job specialization.
• Fayol noted firms can have too much specialization leading
to poor quality and worker involvement.
2. Authority and Responsibility: Fayol included both formal
and informal authority resulting from special expertise.
3. Unity of Command: Employees should have only one boss.
4. Line of Authority: a clear chain from top to bottom of the
firm.
5. Centralization: the degree to which authority rests at the
very top.
6. Unity of Direction: One plan of action to guide the organization.
7. Equity: Treat all employees fairly in justice and respect.
8. Order: Each employee is put where they have the most value.
9. Initiative: Encourage innovation.
10. Discipline: obedient, applied, respectful employees needed
11. Remuneration of Personnel: The payment system
contributes to success.
12. Stability of Tenure: Long-term employment is important.
13. General interest over individual interest: The organization
takes precedence over the individual.
14. Esprit de corps: Share enthusiasm or devotion to the
organization.
 Criticism of Fayol
• Fayol’s principle of specialisation produces following
dysfunctional consequences-
Leads to formation of small groups with norms and goals
different from management
Results in dissatisfaction of workers as they have no
opportunity to use their capabilities.
Results in increase in overhead cost because of more
coordination needed.
• Based on few case studies which have not been tested
empirically.
• Based on assumption that organisations are closed
systems while they are not.
 Humanistic Perspective
Emphasized understanding human behavior,
needs, and attitudes in the workplace

● Human Relations Movement

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 Human Relations Movement

Emphasized satisfaction of employees’

basic needs as the key to increase worker
productivity

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 Hawthorne Studies
• Ten year study
• Four experimental & three control groups
• Five different tests

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 Hawthorne Studies
Study of worker efficiency at the Hawthorne
Works of the Western Electric Co. during
1924-1932.
1. Illumination experiments-
• was done to see if productivity is positively
co-related with illumination.
• It was studied with help of control group
• and the results were found that illumination
affected production only marginally.
2. Relay Assembly Test Rooms-
• To study what is the effect of length of working day,
rest pauses, their frequency and duration and other
physical conditions.
• Six women workers were chosen, they were given
friendly atmosphere, friendly supervisors and then
variations were made in their working conditions
• There was no relation of change in conditions to
productivity.
• Reasons were feeling of importance, warm
informality within the group, tension free
interpersonal relation and high cohesion among girls.
3. Interviewing Program-
• Was done to find basic factors responsible for human
behaviour at work.
• 20,000 workers interviewed.
• It revealed that worker’s social relation inside
organization had influence on their attitude and
behaviour.
4. Bank wiring observation room-
• To determine effect of informal group norms and formal
economic incentives on productivity.
• Found that groups evolved it’s own production norms for
each individual worker which were much lower than that
set by management.
• This was to save weaker and slower workers.( Great
Depression days)
Limitations of Human Relations Movement-
• Just considered human variable and ignored other
variables.
• Provides unrealistic picture about informal groups by
describing them as major contributors of satisfaction.
• Leisurely process of decision making cannot work
during emergency.
• Makes unrealistic demands on supervisor.
 Behavioural Approach
Douglas McGregor, Abraham Maslow, Kurt Lewin
Chester Barnard are some of early contributors .
• Applies social science in an organizational context
• Draws from economics, psychology, sociology,
anthropology, and other disciplines
– Understand employee behavior and interaction in an
organizational setting
– OD – Organization Development

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 Abraham Maslow’s 1908-1970
Hierarchy of Needs

Self-actualization

Esteem
Belongingness
Safety
Physiological

Based on needs satisfaction

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 Douglas McGregor Theory X & Y
Theory X Assumptions 1906-1964 Theory Y Assumptions

• Dislike work –will avoid it • Do not dislike work

• Must be coerced,
controlled, directed, or
threatened with
punishment
• Prefer direction, avoid
responsibility, little
ambition, want security
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• Self direction and self
control
• Seek responsibility
• Imagination, creativity
widely distributed
• Intellectual potential only
partially utilized
 Management Science Perspective
• Emerged after WW II
• Applied mathematics, statistics, and other
quantitative techniques to managerial
problems
Operations Research – mathematical modeling
Operations Management – specializes in physical
production of goods or services
Information Technology – reflected in management
information systems
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 Recent Historical Trends

● Systems Theory

● Contingency View

● Total Quality Management (TQM)

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 Systems Theory
It provides an integrated approach to
management problems. Key concepts of the
approach is-
• System is a set of interdependent units
namely task, structure, people and
technology.
• Concept of holism.
• Organization is an open system.
• Every system has a boundary.
 Systems View of Organizations

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 Contingency View of Management

Successful resolution of organizational problems is thought to depend on

managers’ identification of key variations in the situation at hand
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Elements of a Learning Organization
Team-Based Structure

Learning
Organization
Empowered Open
Employees Information

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