Chapter one: fundamentals of management
Management is means the process of
coordinating resources and make use of the five major functions of planning,
organizing, staffing, directing leading and controlling to achieve
organizational goals/desired objectives.
Ø It
is the art of accomplishing tasks through others by creating a conducive
environment. This process emphasizes both the objectives to be achieved and the
individuals who will be working towards them.
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The Nature of Management:
Ø Universal
Applicability: Management is relevant in any organization,
regardless of its size or purpose.
Ø Goal
Orientation: It is crucial for the efficient achievement of
organizational objectives.
Ø Guidance places an emphasis on optimal resource utilization
to ensure goal attainment.
Ø Distinct
from Proprietorship: Management is separate from ownership; managers work
toward organizational goals.
Ø Human
Activity Managed by individuals, not machines, although
technology can assist.
Ø Signifying
Authority: Involves directing, guiding, and controlling with
authority.
Ø Leadership: Managers
lead teams, necessitating inspiration and motivation.
Ø Multidisciplinary: Draws
from various social sciences such as sociology, psychology, and economics.
Is Management Science or Art?
Ø Management
as Science is Systematized Body of
Knowledge: Organized principles and truths applicable universally.
Ø Observation
and Experimentation are based on
observation, testing, and experimentation.
Ø Universally
Applicable Principles involves
Fundamental truths aiding rational decision-making.
Ø Inexact
Science Deals with human behavior, characterized by change
and unpredictability.
Management as Art:
Ø Skill
and Know-How: Involves the practical application of principles for
tangible results.
Ø Subjective
Judgment: Relies on personal creativity, intuition, and
feelings.
Ø Creation
and Innovation: Art in management fosters new ideas and effective
methods.
Ø Result-Oriented: Focuses
on efficiently achieving specific objectives.
Ø Continuous
Practice: Regular application of theories and principles
improves performance.
Management
as a Profession:
1.
Body
of Specialized Knowledge and Technical Proficiency:
·
Management
requires a systematic body of knowledge and technical proficiency in areas such
as production, marketing, finance, and human resource management.
·
Intellectual
preparation or graduate study is necessary for managers to make rational and
scientific decisions.
2.
Formal/Standardized
Education and Training:
·
Like any
profession, management requires formal training and education.
·
Specialized
universities, colleges, and educational institutions provide formal teaching of
management concepts, theories, and principles.
3.
Social
Responsibility:
·
Managers are
responsible for leading organizations and must consider their obligation to
serve society.
·
Adherence to
prescribed moral, social, and legal conduct is essential for the organization's
existence and reputation.
4.
Code
of Conduct:
·
Professions
adhere to strict standards, rules, and regulations defining norms of honesty,
integrity, and professional morality.
·
Managers are
expected to follow a code of conduct in their professional roles.
Management
Levels, Skills, and Roles:
Type of
Managers:
1.
By
Level in the Organization:
·
First-Line
Managers: Responsible for the work of operating employees,
involved in day-to-day tasks, job assignments, performance monitoring, and
maintaining close contact with workers.
·
Middle-Level
Managers Direct the activities of lower-level managers and
sometimes supervise operating employees. Balancing superiors' demands with
subordinates' capacities is a key responsibility.
·
Top
Managers are a small group of executives responsible for overall
organizational management. They establish operating policies, guide
interactions with the environment, and make broad policy decisions.
2.
Functional
and General Managers:
I. Functional Managers:
·
are responsible
for a specific organizational activity, such as production, marketing, or
finance.
·
Oversee people
and activities engaged in a common set of tasks within their designated
function.
II. General Managers:
·
Oversee complex
units like a company, subsidiary, or operating division.
·
Are responsible
for all activities within the unit, including production, marketing, sales, and
finance.
·
Manage the
entire operations of a more complex unit or division, which may have multiple
functional units.
Skills of
Management:
1. Technical Skills involves Abilities
necessary to perform a specific task.
- Importance: Crucial at lower levels where goods
and services are produced.
- Examples:
Writing computer programs, completing accounting statements, analyzing
marketing statistics, drafting design plans.
- Acquisition can be
obtained through training programs or college degrees.
2. Human Skills involves the ability
to work with, motivate, and direct individuals or groups in the organization.
Ø Importance: Essential
at all management levels since tasks involve people.
Ø Includes:
·
Effective
communication involves both writing and speaking.
·
Creating
positive attitudes in the work setting is important.
·
Developing
cooperation among group members is a key aspect.
·
Motivating
subordinates is an essential task.
3. Conceptual Skills means the ability to see the big picture of the organization
and view it from a broad perspective.
Ø Importance: it
is vital for recognizing interrelationships among various parts of the
organization.
Ø Includes:
·
Understand the
organizational system in its totality.
·
Recognizing how
different parts are interrelated and affect each other.
Ø Most Important in:
·
Strategic
planning involves long-range planning.
·
It is more
critical for top-level managers/executives than middle-level managers and
supervisors.
Managerial Roles:
Managerial functions; represent
general administrative duties essential in all organizations, with desired
outcomes achieved through specific managerial roles. Henry Mintzberg identified
ten interrelated roles categorized into three groups:
1. Interpersonal Roles:
Ø Figurehead Role:
·
Description: Involves ceremonial and symbolic duties such as
signing documents and receiving visitors.
·
Example: President of a college is handing out diplomas at
commencement.
Ø Leader Role involves activities like hiring, training,
motivating, and disciplining employees to ensure proper job execution.
Ø Liaison Role:
·
Description: Managers act as a link in both vertical and
horizontal chains of communication.
·
Examples: Internal liaison involves communication within the
organization, and external liaison involves contact with external entities like
trade associations.
2. Informational Roles:
Ø Monitor/Nerve Center Role:
·
Description: Managers stay informed about organizational
happenings, acting as a focal point for non-routine information.
·
Source involves News reports, trade publications, magazines, client
feedback, etc.
Ø Disseminator Role:
·
Description: Managers transmit information gathered to
appropriate members within the organization.
·
Example: Transmitting selected information to subordinates.
Ø Spokesperson Role:
·
Description: Involves representing the organization or its
position to external groups, including government agencies, customers, and
trade organizations.
3. Decisional Roles:
- Entrepreneur Role:
·
Description: Managers initiate and oversee new projects to
improve organizational performance, involving designing and initiating changes.
- Disturbance
Handler Role:
·
Description: Managers deal with corrective actions in non-routine
situations where they have little control, such as conflicts between people or
groups or unexpected external events affecting the company's operations.
- Resource Allocator
Role:
·
Description: Managers decide who gets what resources, including
time, money, people, and physical resources.
- Negotiator Role:
·
Description: Managers participate in negotiating sessions with
external parties (e.g., vendors and unions) to ensure the organization's
interests are represented.
Functions
of Management
1. Planning
is the
act of making decision today decisions regarding future actions.
§ It encompasses the selection
of missions, objectives, and the necessary steps to accomplish them.
§ Planning involves
decision-making, specifically the process of choosing the most suitable courses
of action from various alternatives.
- The nature of this task is
intellectual, bridging the gap between present and future organizational
conditions.
- Determines what needs to be done,
how, why, when, and by whom.
- Starts with determining the
organization's objectives, establishing sub-unit objectives, and creating
programs for systematic achievement.
- Top-level managers plan for the
entire company, while lower-level managers plan for their specific areas.
- Planning is done in consideration
of budget constraints, personnel requirements, competition, and other
factors.
2.
Organizing involves establishing an intentional structure of
roles for individuals in an organization.
- Creates an environment for human
performance based on predetermined objectives.
- Identifies activities for objective
achievement, groups these activities into working units, assigns
responsibility and authority, and creates intentional organizational
relationships to enhance coordination.
3.
Staffing involves the process of filling and maintaining
filled positions in the organization structure.
- Activities: Involves identifying workforce
requirements, inventorying available people, recruiting, selecting,
placing, promoting, compensating, training, and developing candidates, and
current jobholders.
4.
Leading: Involves influencing, motivating, and directing people
to contribute to organizational and group goals.
- Focus: Predominantly deals with the
interpersonal aspect of managing.
- Requirements: Requires an understanding of
individual and group behavior, motivation techniques, effective leadership
styles, and good interpersonal skills.
- Elements: Includes motivation, leadership
styles, and communication.
5. Controlling involves the measuring and correcting of subordinate activities to ensure they conform to plans.
Ø Steps:
·
Establish
standards of performance.
·
Measuring actual
performance and comparing it against the established standards.
·
Take corrective
measures if deviations exist.
Ø Focus Areas:
Product quality, worker performance, and cost control require particular
attention.
Universality
of Management:
- Basic Application: Management principles are
universally applied in organizations, irrespective of size, complexity, or
type (business or non-business).
- Functions Existence: Managerial functions like
planning, organizing, staffing, leading, and controlling are practiced in
every organization.
- Applicability across Levels: Universality extends to all levels
of management within an organization, making management principles
adaptable across different managerial roles.
- Transferability of Managers: Managers can be transferred
between organizations, with higher-level managers having more transferable
roles.
The
Environment of Management:
I.
Internal Environment:
- Control: Activities performed within the
organization are under managerial control.
- Factors: Include activities of different
divisions, physical, financial, and human resources, along with the values
of controlling managers.
II.
External Environment:
- Political and
Legal Forces:
- Political Environment: Government actions significantly
impact organizations, either promoting or constraining businesses.
- Legal Environment: Laws and regulations shape
organizational behavior and decision-making, emphasizing the need for
managers to be aware of legal restrictions.
- Economic Forces:
- Factors: Include resource availability,
economic trends, GNP, disposable income, consumer purchasing power,
investment trends, price levels, and competition.
- Social Forces:
- Factors: Encompass national traditions,
values, customs, consumer psychology, attitudes, desires, expectations,
intelligence, education, and beliefs.
- Impact: Poses both opportunities and
threats to businesses, reflecting the diversity of values across
different social groups.
- Technological
Forces:
- Variables: Break through influencing
products, services, production methods, and distribution.
- Influence: Shapes how organizations design,
produce, distribute, and sell goods and services, with advantages and
disadvantages.
- Ethical Forces:
- Ethics: Deals with what is good or bad,
moral duty, and obligation.
- Standards: Generally accepted and practiced
standards of personal conduct, beyond legal requirements.
- Responsibility: Managers should consider and
adhere to ethical codes, filling the gap between legal obligations and
actual decision-making.