What is management?

Management can be defined as the process of administering and

controlling the affairs of the organization, irrespective of its nature,
type, structure and size. It is an act of creating and maintaining such
a business environment wherein the members of the organization can
work together, and achieve business objectives efficiently and
effectively.

Management acts as a guide to a group of people working in the

organization and coordinating their efforts, towards the attainment of
the common objective.

In other words, it is concerned with optimally using 5M’s, i.e. men,

machine, material, money and methods and, this is possible only
when there proper direction, coordination and integration of the
processes and activities, to achieve the desired results.

Functions of Management
1. Management has been described as a social process involving responsibility for economical and effective
planning & regulation of operation of an enterprise in the fulfillment of given purposes. It is a dynamic
process consisting of various elements and activities. These activities are different from operative
functions like marketing, finance, purchase etc. Rather these activities are common to each and every
manger irrespective of his level or status.

2. Different experts have classified functions of management. According to George & Jerry, “There are four
fundamental functions of management i.e. planning, organizing, actuating and controlling”.

3. According to Henry Fayol, “To manage is to forecast and plan, to organize, to command, & to control”.
Whereas Luther Gullick has given a keyword ’POSDCORB’ where P stands for Planning, O for
Organizing, S for Staffing, D for Directing, Co for Co-ordination, R for reporting & B for Budgeting. But the
most widely accepted are functions of management given by KOONTZ and O’DONNEL
i.e. Planning, Organizing, Staffing, Directing and Controlling.

4. For theoretical purposes, it may be convenient to separate the function of management but practically these
functions are overlapping in nature i.e. they are highly inseparable. Each function blends into the other & each
affects the performance of others.
2
5.

• Planning
6. It is the basic function of management. It deals with chalking out a future course of action & deciding in
advance the most appropriate course of actions for achievement of pre-determined goals. According to
KOONTZ, “Planning is deciding in advance - what to do, when to do & how to do. It bridges the gap
from where we are & where we want to be”. A plan is a future course of actions. It is an exercise in
problem solving & decision making. Planning is determination of courses of action to achieve desired
goals. Thus, planning is a systematic thinking about ways & means for accomplishment of pre-
determined goals. Planning is necessary to ensure proper utilization of human & non-human
resources. It is all pervasive, it is an intellectual activity and it also helps in avoiding confusion,
uncertainties, risks, wastages etc.

• Organizing
7. It is the process of bringing together physical, financial and human resources and developing
productive relationship amongst them for achievement of organizational goals. According to Henry
Fayol, “To organize a business is to provide it with everything useful or its functioning i.e. raw material,
tools, capital and personnel’s”. To organize a business involves determining & providing human and
non-human resources to the organizational structure. Organizing as a process involves:

• Identification of activities.
• Classification of grouping of activities.
• Assignment of duties.
• Delegation of authority and creation of responsibility.
• Coordinating authority and responsibility relationships.
• Staffing
8. It is the function of manning the organization structure and keeping it manned. Staffing has assumed
greater importance in the recent years due to advancement of technology, increase in size of
business, complexity of human behavior etc. The main purpose o staffing is to put right man on right

3
 job i.e. square pegs in square holes and round pegs in round holes. According to Kootz & O’Donell,
“Managerial function of staffing involves manning the organization structure through proper and
effective selection, appraisal & development of personnel to fill the roles designed un the structure”.
Staffing involves:

• Manpower Planning (estimating man power in terms of searching, choose the person and giving the right
place).
• Recruitment, Selection & Placement.
• Training & Development.
• Remuneration.
• Performance Appraisal.
• Promotions & Transfer.
• Directing
9. It is that part of managerial function which actuates the organizational methods to work efficiently for
achievement of organizational purposes. It is considered life-spark of the enterprise which sets it in
motion the action of people because planning, organizing and staffing are the mere preparations for
doing the work. Direction is that inert-personnel aspect of management which deals directly with
influencing, guiding, supervising, motivating sub-ordinate for the achievement of organizational goals.
Direction has following elements:

• Supervision
• Motivation
• Leadership
• Communication

10. Supervision- implies overseeing the work of subordinates by their superiors. It is the act of watching &
directing work & workers.

11. Motivation- means inspiring, stimulating or encouraging the sub-ordinates with zeal to work. Positive,
negative, monetary, non-monetary incentives may be used for this purpose.

12. Leadership- may be defined as a process by which manager guides and influences the work of
subordinates in desired direction.

13. Communications- is the process of passing information, experience, opinion etc from one person to
another. It is a bridge of understanding.

• Controlling
14. It implies measurement of accomplishment against the standards and correction of deviation if any to
ensure achievement of organizational goals. The purpose of controlling is to ensure that everything
occurs in conformities with the standards. An efficient system of control helps to predict deviations
before they actually occur. According to Theo Haimann, “Controlling is the process of checking
whether or not proper progress is being made towards the objectives and goals and acting if
necessary, to correct any deviation”. According to Koontz & O’Donell “Controlling is the measurement
& correction of performance activities of subordinates in order to make sure that the enterprise
objectives and plans desired to obtain them as being accomplished”. Therefore controlling has
following steps:

1. Establishment of standard performance.

2. Measurement of actual performance.

4
 3. Comparison of actual performance with the standards and finding out deviation if any.
4. Corrective action.

Organizational objectives are short-term and medium-term

goals that an organization seeks to accomplish. An
organization's objectives will play a large part in developing
organizational policies and determining the allocation of
organizational resources. Achievement of objectives helps an
organization reach its overall strategic goals.

What is Management by Objective ?

The process of setting objectives in the organization to give a sense of direction to
the employees is called as Management by Objectives.

It refers to the process of setting goals for the employees so that they know what they are
supposed to do at the workplace.

Management by Objectives defines roles and responsibilities for the employees and help
them chalk out their future course of action in the organization.

Management by objectives guides the employees to deliver their level best and achieve the
targets within the stipulated time frame

Planning
Definition: Planning is the fundamental management function, which involves deciding beforehand,
what is to be done, when is it to be done, how it is to be done and who is going to do it. It is
an intellectual process which lays down an organisation’s objectives and develops various
courses of action, by which the organisation can achieve those objectives. It chalks out exactly, how
to attain a specific goal.

Planning is nothing but thinking before the action takes place. It helps us to take a peep into the
future and decide in advance the way to deal with the situations, which we are going to encounter in
future. It involves logical thinking and rational decision making.

5
 Characteristics of Planning

1. Managerial function: Planning is a first and foremost managerial function

provides the base for other functions of the management, i.e. organising,
staffing, directing and controlling, as they are performed within the periphery of
the plans made.
2. Goal oriented: It focuses on defining the goals of the organisation, identifying
alternative courses of action and deciding the appropriate action plan, which is
to be undertaken for reaching the goals.
3. Pervasive: It is pervasive in the sense that it is present in all the segments and is
required at all the levels of the organisation. Although the scope of planning
varies at different levels and departments.
4. Continuous Process: Plans are made for a specific term, say for a month,
quarter, year and so on. Once that period is over, new plans are drawn,
considering the organisation’s present and future requirements and conditions.
Therefore, it is an ongoing process, as the plans are framed, executed and
followed by another plan.

6
5. Intellectual Process: It is a mental exercise at it involves the application of mind,
to think, forecast, imagine intelligently and innovate etc.
6. Futuristic: In the process of planning we take a sneak peek of the future. It
encompasses looking into the future, to analyse and predict it so that the
organisation can face future challenges effectively.
7. Decision making: Decisions are made regarding the choice of alternative
courses of action that can be undertaken to reach the goal. The alternative
chosen should be best among all, with the least number of the negative and
highest number of positive outcomes.
Planning is concerned with setting objectives, targets, and formulating plan to accomplish them. The
activity helps managers analyse the present condition to identify the ways of attaining the desired
position in future. It is both, the need of the organisation and the responsibility of managers.

. Steps involved in Planning

7
By planning process, an organisation not only gets the insights of the future, but it also helps
the organisation to shape its future. Effective planning involves simplicity of the plan, i.e.
the plan should be clearly stated and easy to understand because if the plan is too
much complicated it will create chaos among the members of the organisation. Further,
the plan should fulfil all the requirements of the organisation.

PURPOSES OF PLANNING IN AN ORGANIZATION

The following are some of the important purpose of planning in an organization.

1. Facilitates Accomplishment of Objectives: The aim of planning is to facilitate the

attainment of objectives. It focuses its attention on the objectives of the organization. It states
the objectives of each department in the organization and of the enterprise as a whole. This
helps personnel to see the enterprise in its entirety and see how their actions contribute to its
ultimate goals. Planning forces the managers to consider the future and revise its plans if
necessary for achieving the objectives.
2. Ensures Economy in Operations: Since planning emphasizes efficient operation and
consistency, it minimizes costs and gains economical operation. Coordinated group effort,
even flow of work and deliberate decisions are due to planning.
3. Precedes Control: Control involves those activities which are carried out to force events to
conform to plans. Plans serves as standards of performance. Control seeks to compare actual
performance with set standards. So control cannot be exercised without plans.
4. Provides for Future Contingency: Planning is required because future is uncertain.
Planning enables the management to look into the future and discover suitable alternative
course of action. Planning helps the management to have a clear-cut idea about the future and
to frame a suitable programme for action. Even when the future is highly certain, planning is
essential to decide the best course of action.
5. Facilitates Optimum Utilization of Resources: Various resources that are relevant to an
organization namely, funds, physical resources, manpower, technological know-how, etc., are
by and large inadequate due to demand from competing organizations and have alternative
uses. This necessitate the organization to make the best possible use of resources. Planning
facilitates optimum use of available resources.
6. Pr-requisites for other Managerial Functions: The purposes of planning is to provide a
conceptual and concrete basis for initiating and undertaking other managerial functions like
staffing, organizing, directing and control. Planning is a primary function and it goes a long
way to improve efficiency of other functions of management and makes the management tasks
more effective.
7. All Pervasive Function: Planning is a function of managers at all levels though the scope,
nature and extent of planning differs from one enterprise to another and from one level to
another. Irrespective of the level and area of his operation, each and every manager has to
perform this function. Planning at the top level will be fundamental, broad and far-reaching.
Managers at other levels may plan about their departmental activities for a short period.
In this connection, Theo Haimann says that

“the scope, extent and importance of the nature of planning tend to decrease as we descend
toward the lower levels of management and approach the point of execution of the plan”.

8
8. Coordinates the Activities: Coordination is an important factor for the smooth functioning
of an organization. As pointed out by H.G. Hicks,

“planning coordinates the activities of the organization toward defined and agreed upon
objectives. The alternative is random behavior”.

If planning is absent, various divisions of the organization may pursue different objectives.

9. Provides for the Delegation of Authority: Planning provides for the delegation of
authority to subordinates. Well-formulated plans serve as guides to subordinates and reduce
risk involved in delegation of authority

9
Planning Function of Management
Planning means looking ahead and chalking out future courses of action to be followed.
It is a preparatory step. It is a systematic activity which determines when, how and who
is going to perform a specific job. Planning is a detailed programme regarding future
courses of action.

It is rightly said “Well plan is half done”. Therefore planning takes into consideration
available & prospective human and physical resources of the organization so as to get
effective co-ordination, contribution & perfect adjustment. It is the basic management
function which includes formulation of one or more detailed plans to achieve optimum
balance of needs or demands with the available resources.

According to Urwick, “Planning is a mental predisposition to do things in orderly way, to

think before acting and to act in the light of facts rather than guesses”. Planning is
deciding best alternative among others to perform different managerial functions in
order to achieve predetermined goals.

According to Koontz & O’Donell, “Planning is deciding in advance what to do, how to do
and who is to do it. Planning bridges the gap between where we are to, where we want
to go. It makes possible things to occur which would not otherwise occur”

Nature of Organisation:
There are some common features of organisation through
which a clear idea about its nature can be obtained. These are
indicated below:
1. Process:
Organisation is a process of defining, arranging and grouping the activities of an
enterprise and establishing the authority relationships among the persons performing
these activities. It is the framework within which people associate for the attainment of
an objective.

The framework provides the means for assigning activities to various parts and
identifying the relative authorities and responsibilities of those parts. In simple term,
organisation is the process by which the chief executive, as a leader, groups his men in
order to get the work done.

2. Structure:
The function of organising is the creation of a structural framework of duties and
responsibilities to be performed by a group of people for the attainment of the objectives

10
 of the concern. The organisation structure consists of a series of relationships at all
levels of authority.

“identifiable group of people

An organisation as a structure contains an
contributing their efforts towards the attainment of goals.” It is
an important function of management to organise the enterprise by grouping the
activities necessary to carry out the plans into administrative units, and defining the
relationships among the executives and workers in such units.
3. Dividing and Grouping the Activities:
Organising means the way in which the parts of an enterprise are put into working
order. In doing such, it calls for the determination of parts and integration of one
complete whole on the other. In fact, organisation is a process of dividing and
combining the activities of an enterprise.

Activities of an enterprise are required to be distributed between the departments, units

or sections as well as between the persons for securing the benefits of division of labour
and specialisation, and are to be integrated or combined for giving them a commonness
of purpose.

L. Urwick defines organisation as: ‘determining what activities are necessary to any
purpose and arranging them as groups which may be assigned to individual.

4. Accomplishment of Goals or Objectives:

ADVERTISEMENTS:

An organisation structure has no meaning or purpose unless it is built around certain

clear-cut goals or objectives. In fact, an organisation structure is built-up precisely
because it is the ideal way of making a rational pursuit of objectives. Haney defines
organisation as: “a harmonious adjustment of specialised parts for
the accomplishment of some common purpose or purposes”.
5. Authority-Responsibility Relationship:
An organisation structure consists of various positions arranged in a hierarchy with a
clear definition of the authority and responsibility associated with each of these. An
enterprise cannot serve the specific purposes or goals unless some positions are placed
above others and given authority to bind them by their decisions.

11
 In fact, organisation is quite often defined as a structure of authority-responsibility
relationships.

6. Human and Material Aspects:

Organisation deals with the human and material factors in business. Human element is
the most important element in an organisation. To accomplish the task of building up a
sound organisation, it is essential to prepare an outline of the organisation which is
logical and simple. The manager should then try to fit in suitable men. Henry Fayol says
in this connection: “see that human and material organisations are
suitable” and “ensure material and human order”.

ADVERTISEMENTS:

From these features of organisation, it emerges that, an organisation is essentially an

administrative ‘process’ of determining what activities are necessary to be performed for
the achievement of objectives of an enterprise, dividing and grouping the work into
individual jobs and, a ‘structure’ of positions arranged in a hierarchy with defined rela-
tionships of authority and responsibility among the executives and workers performing
these tasks for the most effective pursuit of common goals of the enterprise.

Importance and Significance of Organisation:

All business and non-business enterprises require sound organisation for their smooth,
efficient and economical operation to achieve maximum results with minimum of cost
and efforts. Evidently, when two or more people are engaged in an institution, the task
of each person is required to be fixed through the division of total activities among them
and they should have a concerted action.

Each one’s work must be directed in such a way that they can reach the commonness of
purpose.

A sound organisation is a must for success in any line of business. This is necessitated by
the magnitude and complexities of business enterprises. The entire work of such
enterprises is beyond the capacity of a single person to manage. When there is
specialisation and division of work into its logical component parts, it can attain
economies of large-scale production.

The speed of performance is ensured and the standard of work performed is improved
by distributing the work constantly among a number of persons on the basis of their

12
 knowledge, experience and capacity. Organisation sets the relationship between people,
work, and resources. Whenever groups of people exist in a common effort, organisation
must be employed to get productive results.

Organisation is a tool of efficient management. It is the mechanism through which the

manager directs co-ordinates and controls the business affairs. It is, indeed, the
foundation of business and, as such, it provides a means by which human efforts are
properly directed to more and more productive, effective and fruitful results.

Organisation is a means by which the problems of the enterprise connected with

policies, operations, and administration can efficiently be solved. Sound organisation
can contribute greatly to the success and continuity of the enterprise.

The importance of sound organisation will be more clear if we remember what Andrew
Carnegie once said: “Take away our factories, take away our trade, our avenues of
transportation, our money, leave us nothing but our organisation, and in four years we
shall have established ourselves.”

So, no institution or enterprise—whether business, educational, cultural or governmen-

tal—can function properly and successfully without sound organisation. And herein lies
the need for and significance of organisation.

Formal Organisation
Chester I Bernard defines formal organisation as -"a system of consciously coordinated
activities or forces of two or more persons. It refers to the structure of well-defined jobs,
each bearing a definite measure of authority, responsibility and accountability." The
essence of formal organisation is conscious common purpose and comes into being when
persons–

i. Are able to communicate with each other

ii. Are willing to act and
iii. Share a purpose.
The formal organisation is built around four key pillars. They are:

• Division of labour
• Scalar and functional processes
• Structure and

13
• Span of control
Thus, a formal organisation is one resulting from planning where the pattern of structure has
already been determined by the top management.

Characteristics of Formal and Informal Organisation

Characteristic Features of formal organisation

1. Formal organisation structure is laid down by the top management
to achieve organisational goals.
2. Formal organisation prescribes the relationships amongst the
people working in the organisation.
3. The organisation structures is consciously designed to enable the
people of the organisation to work together for accomplishing the
common objectives of the enterprise
4. Organisation structure concentrates on the jobs to be performed
and not the individuals who are to perform jobs.
5. In a formal organisation, individuals are fitted into jobs and positions
and work as per the managerial decisions. Thus, the formal
relations in the organisation arise from the pattern of responsibilities
that are created by the management.
6. A formal organisation is bound by rules, regulations and
procedures.
7. In a formal organisation, the position, authority, responsibility and
accountability of each level are clearly defined.
8. Organisation structure is based on division of labour and
specialisation to achieve efficiency in operations.
9. A formal organisation is deliberately impersonal. The organisation
does not take into consideration the sentiments of organisational
members.
10. The authority and responsibility relationships created by the
organisation structure are to be honoured by everyone.
11. In a formal organisation, coordination proceeds according to the
prescribed pattern.
Advantages of formal organisation
1. The formal organisation structure concentrates on the jobs to be
performed. It, therefore, makes everybody responsible for a given
task.

14
2. A formal organisation is bound by rules, regulations and
procedures. It thus ensures law and order in the organisation.
3. The organisation structure enables the people of the organisation to
work together for accomplishing the common objectives of the
enterprise
Disadvantages or criticisms of formal organisation
1. The formal organisation does not take into consideration the
sentiments of organisational members.
2. The formal organisation does not consider the goals of the
individuals. It is designed to achieve the goals of the organisation
only.
3. The formal organisation is bound by rigid rules, regulations and
procedures. This makes the achievement of goals difficult.
Informal Organisation
Informal organisation refers to the relationship between people in the organisation based on
personal attitudes, emotions, prejudices, likes, dislikes etc. an informal organisation is an
organisation which is not established by any formal authority, but arises from the personal
and social relations of the people.

These relations are not developed according to procedures and regulations laid down in the
formal organisation structure; generally large formal groups give rise to small informalor
social groups. These groups may be based on same taste, language, culture or some other
factor. These groups are not pre-planned, but they develop automatically within the
organisation according to its environment.

Characteristics features of informal organisation

1. Informal organisation is not established by any formal authority. It is
unplanned and arises spontaneously.
2. Informal organisations reflect human relationships. It arises from the
personal and social relations amongst the people working in the
organisation.
3. Formation of informal organisations is a natural process. It is not
based on rules, regulations and procedures.
4. The inter-relations amongst the people in an informal organisation
cannot be shown in an organisation chart.

15
5. In the case of informal organisation, the people cut across formal
channels of communications and communicate amongst
themselves.
6. The membership of informal organisations is voluntary. It arises
spontaneously and not by deliberate or conscious efforts.
7. Membership of informal groups can be overlapping as a person may
be member of a number of informal groups.
8. Informal organisations are based on common taste, problem,
language, religion, culture, etc. it is influenced by the personal
attitudes, emotions, whims, likes and dislikes etc. of the people in
the organisation.
Benefits of Informal organisation
1. It blends with the formal organisation to make it more effective.
2. Many things which cannot be achieved through formal organisation
can be achieved through informal organisation.
3. The presence of informal organisation in an enterprise makes the
managers plan and act more carefully.
4. Informal organisation acts as a means by which the workers
achieve a sense of security and belonging. It provides social
satisfaction to group members.
5. An informal organisation has a powerful influence on productivity
and job satisfaction.
6. The informal leader lightens the burden of the formal manager and
tries to fill in the gaps in the manager's ability.
7. Informal organisation helps the group members to attain specific
personal objectives.
8. Informal organisation is the best means of employee
communication. It is very fast.
9. Informal organisation gives psychological satisfaction to the
members. It acts as a safety valve for the emotional problems and
frustrations of the workers of the organisation because they get a
platform to express their feelings.
10. It serves as an agency for social control of human behaviour.
Management's Attitude Towards Informal Organisation
Formal organisation, no doubt is an important part of the organisation but it alone is not
capable of accomplishing the organisational objectives. Informal organisation supplements
the formal organisation in achieving the organisational objectives. If handled properly,

16
informal organisation will help in performing the activities of the organisation very efficiently
and effectively. In the words of Keith Davis-"An informal organisation is a powerful influence
upon productivity and job satisfaction. Both formal and informal systems are necessary for
group activity just as two blades are essential to make a pair of scissors workable". As both
formal and informal organisations are quite essential for the success of any organisation, a
manager should not ignore the informal organisation. He should study thoroughly the
working pattern of informal relationship in the organisation and use the informal organisation
for achieving the organisational objectives.

Differences Between Formal and Informal Organisation

17
What is an Organizational Chart?
The definition of an organization chart or "org chart" is a diagram that displays a
reporting or relationship hierarchy. The most frequent application of an org chart is to
show the structure of a business, government, or other organization.

Org charts have a variety of uses, and can be structured in many different ways. They
might be used as a management tool, for planning purposes, or as a personnel
directory, for example. Perhaps your organization doesn't operate in a "command and
control" style, but instead relies on teams.

Here are some ideas and examples to help you design the perfect organisational chart
for your needs.

Principles of Organization: As Listed by Koontz

A principle is a basic statement or a fundamental truth that provides understanding and guidance to
thinking and practice.

The important principles of organisation, as listed by Koontz, may be stated thus:

18
Principle # 1. Purpose of Organising:
ADVERTISEMENTS:

Organisation should facilitate the achievement of enterprise objectives in an efficient way.

The ways are:

i. Principle of unity of objective- An organisation structure is effective when it helps the achievement
of enterprise objectives.

ii. Principle of organisational efficiency- An organisation structure is efficient if it facilitates the

achievement of objectives with minimum costs.

ADVERTISEMENTS:

An efficient organisation structure operates without wastage of resources, allows maximum

utilization of human resources, offers clear lines of authority and responsibility and provides a means
for personal development.

Principle # 2. The Cause of Organising:

Span of management is the basic cause of an organisation structure. But for the principle of span of
management, firms would ever remain small-managed by only one manager.

Principle of span of management- A manager should have a limited number of subordinates

reporting to him directly. Generally, the span should be short for novel, complex work and long for
routine, simple work.

Principle # 3. The Structure of Organisation

(Authority):
Authority is the cementing force in every organisation. It is the means by which groups of activities
can be put under a manager. It enables the top to coordinate enterprise work effectively. A manager
can show proper direction and create an environment for sound individual performance.

ADVERTISEMENTS:

i. Principle of scalar chain- A scalar chain or chain of command refers to the unbroken line of
authority from the top level to the bottom of an organisation. A clear chain of command facilitates
communication.

ii. Principle of authority and responsibility- Subordinates must enjoy enough authority to carry out
work at lower levels. While granting authority, the superior must state clearly what he expects, when
he expects it done and by whom. The subordinate on his part, must show good performance,
following the directives of the superior.

19
Responsibility, in simple terms, is the obligation of a subordinate to perform the duty as required by
the superior. As a matter of principle, there should be parity between authority and responsibility.
Authority without corresponding responsibility results in misuse of authority while responsibility in the
absence of adequate authority brings about frustration and ineffective performance.

iii. Principle of unity of command- The unity of command principle states that for any given activity an
employee should be made accountable to only one superior.

ADVERTISEMENTS:

iv. Authority level principle- Decisions within the authority of individuals should be made by them and
not referred upward in the organisation structure. Delegation would be a futile exercise if the
subordinates wait at the doorsteps of a superior for an audience before they take actions within their
authority.

Principle # 4. The Structure of Organization

(Departmentation):
The primary purpose of organising is to provide a basic structure in the form of a departmental
framework.

Principle of functional definition- The duties, authority and responsibility of every individual must be
clearly stated. People at various levels must know what they are supposed to do, when, and for
whom. They must also know the limits to their behaviour.

Principle # 5. The Process of Organizing:

The process of organizing becomes easy when the following principles are applied sincerely:

ADVERTISEMENTS:

i. Principle of balance- Different departments and activities in an organization should be given a

balanced and proportionate emphasis in relation to their overall contribution to objectives.

ii. Principle of flexibility-The organisation structure should be designed in a flexible way. It should be
possible to effect changes in the structure depending on situational requirements.

iii. Principle of stability- At the same time, the organisation structure should be reasonably stable.
Stability refers to the organisation’s ability to withstand changes so as to meet stated organisational
goals in an efficient manner.

iv. Principle of simplicity- The structure should be simple so that personnel follow the assignment of
work and allocation of duties and responsibilities. This facilitates leadership activity also.

Meaning of Span of Management:

Depending upon the complexity of organisational activities and relationships amongst

superiors and subordinates, it becomes important the superiors manage an optimum

20
number of subordinates that result in optimum organisational output. All the
subordinates cannot be managed by one superior. There has to be a limit on the
number of subordinates who can be effectively managed by one superior.

The number of subordinates that a superior can effectively supervise is known as span
of management or span of control. In the 19th and middle of 20th century, management
writers determined 5 or 6 as the optimum number that a manager could effectively
manage at the upper level.

ADVERTISEMENTS:

Beyond this number, managers faced problems like:

1. Overburdened with work.

2. Difficulty in coordinating the activities of large number of people.

3. Difficulty in controlling.

ADVERTISEMENTS:

Thus, optimum number of subordinates that a manager could supervise was

determinable but today, it is not so. Exact number of employees that managers can
effectively supervise cannot be defined. Span of management is situational in nature.

Depending on the number of employees that can be supervised or controlled by managers,

there can be two kinds of structures in the organisation:

I. Tall structures, and

II. Flat structures.

Factors Determining Span of Management

Definition: The Span of Management refers to the number of subordinates who report directly
to a manager.

Factors Determining Span of Management

The span of management can be determined on the basis of a number of relationships that a
manager can manage. These are:

21
1. Capacity of Superior: Here the capacity means the ability of a superior to
comprehend the problems quickly and gel up with the staff such that he gets
respect from all. Also, the communication skills, decision-making ability,
controlling power, leadership skills are important determinants of
supervisory capacity. Thus, a superior possessing such capacity can manage
more subordinates as compared to an individual who lack these abilities.
2. Capacity of Subordinate: If the subordinate is trained and efficient in
discharging his functions without much help from the superior, the
organization can have a wide span. This means a superior can manage a
large number of subordinates as he will be required just to give the broad
guidelines and devote less time on each.
3. Nature of Work: If the subordinates are required to do a routine job, with
which they are well versed, then the manager can have a wider span. But, if
the work is complex and the manager is required to give directions, then the
span has to be narrower.Also, the change in the policies affects the span of
management. If the policies change frequently, then the manager needs to
devote more time and hence the span would be narrow whereas if the
policies remain stable, then a manager can focus on a large number of
subordinates. Likewise, policies technology also plays a crucial role in
determining the span.
4. Degree of Decentralization: If the manager delegates authority to the
subordinates then he is required to give less attention to them. Thus, higher

22
 the degree of decentralization, the wider is the span of management. But in
case, subordinates do not have enough authority, then the manager is
frequently consulted for the clarifications, and as a result superior spends a
lot of time in this.
5. Planning: If the subordinates are well informed about their job roles, then
they will do their work without consulting the manager again and again. This
is possible only because of the standing plans that they follow in their
repetitive decisions. Through a proper plan, the burden of a manager
reduces manifold and can have a wider span of management.
6. Staff Assistance: The use of staff assistance can help the manager in
reducing his workload by performing certain managerial tasks such as
collecting information, processing communications and issuing orders, on
his behalf. By doing so, the managers can save their time and the degree of
span can be increased
7. Supervision from Others: The classical approach to the span of
management, i.e., each person should have a single supervisor is changing
these days. Now the subordinates are being supervised by other managers
in the organization such as staff personnel. This has helped the manager to
have a large number of subordinates under him.
8. Communication Techniques: The mode of communication also determines
the span of management. If in the manager is required to do a face to face
communication with each subordinate, then more time will be consumed.
As a result, the manager cannot have a wider span. But in case, the
communication is in writing and is collected through a staff personnel; the
manager can save a lot of time and can have many subordinates under him.
The span of management is also called as the span of supervision or span of control, which
influences the complexity of the individual manager’s job and determine the shape or
configuration of the organization.

Meaning and Definition of Departmentation

Departmentation is the process which is used to group activities into units for purpose of
administration at all levels. By this process, the personnel and functions of an enterprise
are departmentalized by division into separate units.

Dividing the work naturally means the identification of individual activities which have to
be undertaken for attaining the objectives of the enterprise. But once the various

23
activities have been identified, it is necessary to group them together on some logical
basis. This process of grouping is known as departmentation.

The administrative units so created may be called as divisions, units, branches or by

some other name. Each department or division is a distinct area of activities over which
a manager will be given authority and for which he is responsible. The departments are
agencies of management and simplify the tasks of the management within a workable
span.

6 Different Basis of Departmentation in an Organisation

Article shared by :

ADVERTISEMENTS:

This article throws light upon the six different basis of departmentation in an organisation. The basis
are: 1. Departmentation by Function 2. Departmentation by Products 3. Departmentation by
Territory/Geographic Departmentation 4. Departmentation by Customers 5. Departmentation by
Process 6. Combined Base.

Basis of Departmentation # 1. Departmentation by

Function:
Similar activities of a business are grouped into major departments or divisions under an executive
who reports to the chief executive.

This departmentation is most widely used basis for organising activities and is present in every
organisation at some level (Fig. 6.6).

Merits of Departmentation by Function:

1. It suits well the small enterprises for creating major departments.

2. It promotes specialization.

24
3. It economizes operations and makes possible the adoption of logical and comprehensible
structure.

4. It facilitates inter-departmental co-ordination.

ADVERTISEMENTS:

5. It suits well for those organisations which have single product line.

Demerits of Departmentation by Function:

1. It may lead to excessive centralization.

2. Decision making process is delayed.

3. Poor inter-departmental co-ordination.

ADVERTISEMENTS:

4. It is rather difficult to set up specific accountability and profit centres within functional departments
so the performance is not accurately measured.

5. It hinders human development in all the areas.

Basis of Departmentation # 2. Departmentation by

Product:
In a multiproduct organisation the departmentation by product most suits. Here the activities are
grouped on the basis of produce or product lines. All functions related to particular product are
bought together under the umbrella of product manager. Fig. 6.7 illustrates the product
departmentation.

Merits of Departmentation by Product:

ADVERTISEMENTS:

1. Each product division can be taken as a viable profit centre for accountability purposes. The
performance of individual products can be easily accessed to distinguish between profitable and
unprofitable products.

25
2. Marketing strategy becomes more pragmatic.

3. Top management is relieved of operating task responsibility and can concentrate on such
centralized activities as finance, research etc.

4. It facilitates decentralization.

ADVERTISEMENTS:

5. Attention is given to product lines, which is good for further diversification and expansion.

Demerits of Departmentation by Product:

(1) It increases management cost. Service functions are duplicated both at the top and at the
operating levels of management.

(2) High cost of operation prevents the small & medium sized concerns from adopting this basis of
classification, particularly for creating major units.

(3) There are problems at the top of co-ordination.

Basis of Departmentation # 3. Departmentation by

Territory:
It is suitable for organisations having wide geographical market such as pharmaceuticals, banking,
consumer goods, insurance, railways etc. Here, the market is broken up into sales territories and a
responsible executive is put in charge of each territory. The territory may be known as district,
division or region. The fig. 6.8 shows the geographical departmentation.

Merits of Departmentation by Territory:

1. It helps in achieving the benefits of local operations such as local supply of materials & labour,
local markets etc.

2. Full attention can be paid to local customer groups.

3. A regional division achieves a better co-ordination and supervision of activities in a particular

area.

26
4. It helps in reducing transportation and distribution costs.

5. It facilitates the expansion of business to different regions.

6. It provides an opportunity to a regional manager to gain broad experience as he looks after the
complete operation in a particular territory

Demerits of Departmentation by Territory:

1. It creates the problem of communication and co-ordination between various regional offices.

2. It may be uneconomical due to costly duplication of personnel & physical facilities.

ADVERTISEMENTS:

3. It may be difficult to provide efficient centralized services to various departments located in

different areas.

4. Various regional units may become so engrossed in short term competition among themselves
that the overall long term interests of the organisation as a whole may be overlooked.

5. The problem of top management control becomes difficult.

Basis of Departmentation # 4. Departmentation by

Customers:
This type of classification is adopted by enterprises offering specialized services. To give the
attention to heterogeneous groups of buyers in the market, marketing activities are often split into
various several parts.

ADVERTISEMENTS:

Such groups are suitable to organisations serving several segments like a pharmaceutical company
supplying to institutional buyers such as hospitals and government and non-institutional buyers as
wholesalers and retail chemists.

The general organisation of this type of departmentation is depicted big fig 6.9:

27
Merits of Departmentation by Customers:
1. The main advantage of following this type of departmentation is that particular needs of the
particular- customers can be solved.

2. Benefits of specialization can be obtained.

Demerits of Departmentation by Customers:

1. There may be duplication and underutilization of facilities and resources.

2. It may be difficult to maintain co-ordination among the different customer departments.

Thus, customers’ departmentation is useful for those enterprises which have to cater to the special
and varied needs of different classes of customers.

Basis of Departmentation # 5. Departmentation by

Process:
The production function may be further subdivided on the basis of the process of production when
the production process has distinct activity groups, they are taken as the basis of departmentation.
The departmentation by process can be shown as (Fig 6.10).

Process departmentation is suitable when the machines or equipment’s used are costly and
required special skill for operating. It is useful for organisations which are engaged in the
manufacture of products which involves several processes.

Merits of Departmentation by Process:

1. It provides economy of operation

2. The benefits of specialization are available.

3. Efficient maintenance of equipment’s is possible.

4. It simplifies supervision and plant layout.

Demerits of Departmentation by Process:

1. There may be difficulties in coordinating the activities of different departments

28
2. Due to specialized activity, the employee mobility is reduced.

3. Extreme specialization may reduce flexibility of operations.

4. This type of departmentation may not provide opportunity for the all-round development of
managerial talent.

5. Conflicts may arise among managers of different processes, particularly when they loose sight of
the overall company goals.

Basis of Departmentation # 6. Departmentation-

Combined Base:
Sometimes, several bases of departmentation may be used simultaneously. Fig. 6.11. Denotes the
combined base departmentation. First the organisation is divided on the basis of functions. The
marketing department is further divided on the basis of product lines i.e., refrigeration and chemical
division.

The refrigeration division is further divided on the basis of territory and the territory is further divided
on the basis of customers i.e., retail and wholesale.

Combined base departmentation is also called as composite departmentation or mixed

departmentation. This type of departmentation provide the benefits of both functional and product
structures. But the conflicts between different departments and division may increase. It becomes
necessary to differentiate clearly between the line authority and functional authority of managers.

Authority Definition - Types of Authority in

Management

Authority is defined as the right to give orders, supervise the work of others & make certain
decisions. It is linked with the managerial position to give orders & expect to follow the orders.
In olden days, it was the basic element that made the organizations smoothly working. The
authority was delegated from top to bottom of the organizational hierarchy. Every manager
possessed some Types of Authority according to his designated position. It is related to a
specific position a person holds and his personal characteristics are ignored against his

29
 authority, even if a position becomes vacant in the organization, but still it remains attached to
that position.

• Line Authority
• Staff Authority
• Functional Authority

1. Line Authority

The work of an employee is directed with the help of line authority. It takes the form of
employer-employee relationship that moves from top to bottom. Certain decisions are made by
the line manager without consulting any other person. In some cases line managers are
differentiated from the staff managers by using the word “line”. The manager whose functions
are linked directly with the achievement of organizational objectives is called line manager in
simpler terms.

1. Staff Authority

Staff authority is possessed by the staff managers. The objectives of the organization
determine the line & staff nature of the functions of any manager. When the size of
organization becomes larger & larger, the line mangers feel that they cannot complete their
jobs by the existing skills, experience & knowledge which are not updated accordingly.
Therefore staff authority is generated for the staff whose main purpose is to assist, support,
advice & decrease the work burden of the line managers.

1. Functional Authority

Functional authority that is also known as functional control, and is included in the area of line
& staff aspects of HRM as it is the special authority that is exercised by the personnel manager
in coordinating the personnel activities. The HR manager here performs his functions as right
arm of the supreme executive.

Responsibility
Responsibility is nothing but the duty that comes along with the job. In other words, it is
the obligation of the person to complete the task given to him/her.

It becomes his responsibility. Moreover, it shows that the authority is properly used and
work is done accordingly. Under this, a person is eligible to delegate the work to the
subordinate but not the ultimate accountability.

That means, even if he transfers his work, he will remain responsible for the obligation
of the accomplishment of the work.

30
Definition of Responsibility
As per Davis, “Responsibility is an obligation of an individual to perform assigned duties
to the best of his ability under the direction of his leader.” In the words of Theo
Haimann, “Responsibility is the obligation of a subordinate to perform the duty as
required by his superior”.

As per McFarland, responsibility means, “the duties and activities assigned to a

position or an executive”.

Accountability

It is nothing but the liability created for the transfer of authority. Accountability creates
the obligation of the subordinate and makes him answerable for the work done by
him/her.

Hence, it is the answerability for the performance of the assigned duties. Once a person
accepts authority, he deems to accept Responsibility and Accountability at that time
only.

Definition of Accountability
As per McFarland, “accountability is the obligation of an individual to report formally to
his superior about the work he has done to discharge the responsibility.”

Question: How are Authority, Responsibility and Accountability are inter-related?

Answer: All of the 3 elements are very much related to each other as the creation of
one leads to the creation of another two at a similar point of time. None of the elements
can exist in isolation. That’s why the top management needs a lot of consideration
before deciding the flow of authority. Once authority to take any action for the
accomplishment of any objective is given, the remaining 2 elements viz, Responsibility
and Accountability emerges automatically.

DELIGATION???
Delegation is an administrative process of getting things done by others by giving them
responsibility. All important decisions are taken at top level by Board of Directors. The
execution is entrusted to Chief Executive. The Chief Executive assigns the work to
departmental managers who in I urn delegate the authority to their subordinates. Every
superior delegates the authority to subordinates for getting a particular work done. The
process goes to the level where actual work is executed. The person who is made
responsible for a particular work is given the requisite authority for getting it done.

31
There is a limit up to which a person can supervise the subordinates. When the number
of subordinates increases beyond it then he will have to delegate his powers to others
who perform supervision for him. A manager is not judged by the work he actually
performs on his own but the work he gets done through others. He assigns duties and
authority to his subordinates and ensures the achievement of desired organizational
goals.

Obstacles of delegation | How to secure better

delegation? | Benefits

Home
Management
Business Management
Obstacles of delegation | How to secure better delegation? | Benefits

Table of Contents [show]

Delegation, although seems to be a simple process, suffer from several obstacles in practice.
These obstacles arise partly on account of the superiors’ attitude, partly due to the
subordinates and partly due to the organization. Therefore, we shall study the obstacles under
the following three distinct heads.

Obstacles of delegation On the part of the superior

The reasons for the reluctance of the superiors to delegate can be outlined as follows:

1. Lack of Liberal Attitude: Very often, the executives feel that they can do a job better and
the subordinates are not competent to perform the functions with the same degree of skill.

2. Desire of Dominance: Some managers feel that their subordinates shall learn too much
and shall soon compete with them and even outshine them. Therefore, they try to dominate the
subordinates at each step of work and thereby hampers the process of delegation.

3. Inability to Direct: Inability of the superior to issue suitable directions and guidance also
creates difficulties in the process of delegation.

4. Lack of Confidence: Superiors often lack confidence in their subordinates. Therefore, they
are reluctant to their reliance on their integrity and do not delegate.

5. Absence of Controls: When the executives have no means of knowing the serious
difficulties in the working of the department in advance, they may hesitate to delegate the
authority.

32
 Obstacles of delegation on the part of subordinates
Even if the superior is willing to delegate authority, the process of delegation shall fail if it is not
accepted by the subordinates. The subordinates may be shy in accepting the authority and
thereby assume responsibility because of the following reasons.

1. Easier to Ask: Subordinates often feel that it is more easier to depend on the decision of the
boss rather than to make on their own.

2. Fear of Criticism: The fear of criticism on the part of the superiors may also make them shy
in accepting authority.

3. Lack of information: Subordinates hesitate to assume responsibility, if they feel that they
lack the necessary information and resources to do a good job.

4. Lack of Self-confidence: Subordinates who have no confidence on their own skill may be
unwilling to accept difficult assignment.

5. Lack of Proper incentive: In the absence of proper incentive or reward, subordinates shall
be unwilling to assume responsibilities and show their masterly skill.

Obstacles of delegation on the part of organization

The faults contributing to the failure of the process of delegation also lie with the organisational
set up. They may include the following:

1. Defective organizational structure.

2. Vague plans.
3. Splintered authority and responsibility.
4. Dual subordination.
5. Absence of effective control measures

Difference Between Centralization and

Decentralization

Last updated on June 7, 2017 by Surbhi S

33
Centralization and Decentralization are the two types of structures, that can
be found in the organization, government, management and even in
purchasing. Centralization of authority means the power of planning and
decision making are exclusively in the hands of top management. It alludes to
the concentration of all the powers at the apex level.

On the other hand, Decentralization refers to the dissemination of powers

by the top management to the middle or low-level management. It is the
delegation of authority, at all the levels of management.

To determine whether an organization is centralized or decentralized greatly

depends on the location of decision-making authority and the degree of
decision-making power at lower levels. There is a never ending debate
between these two terms to prove which one is better. In this article,
significant differences between Centralization and Decentralization, in an
organization is explained.

34
FACTORS DETERMINING DEGREE OF DECENTRALIZATION
15. The extent to which the authority should be dispersed is basically a
policy matter and so the top management must make decision, in
this regard while designing the organizational structure. As stated
by H.Koontz and O’Donnell, the factors which govern the policy of
the management can be enumerated as follows:
16. 1. Cost Factors: The over riding factor determining the extent of
decentralization is the criterion of costliness. If the decision involve
heavy cost or investment, decision-making should not be delegated

35
 recklessly because if anything goes wrong, the enterprise has to
incur financial losses.
17. 2. Uniformity of Policy: When there is no need for uniformity of
policy, high degree of decentralization is possible. On the other
hand, if the company desires to obtain uniform policy, centralized
authority is the easiest road to attain it.
18. 3. History of the Enterprise: The way in which the business has been
built is another factor which determines the degree of
decentralization. If it has developed a set of departments first and
other departments or divisions are established later, authority tends
to be centralized.
19. 4. Management Philosophy: The character and philosophy of the
executive also influence the extent of decentralization. If the persons
in the helm of affairs believe and have faith in decentralization then
decentralization will prevail. If they are inclined to centralized
authority due to various reasons, centralization will prevail.
20. 5. Desire for Independence: The desire of the top management to
develop the group executives at lower level so as to motivate them
shall also pave way for decentralization.
21. 6. Availability of Managers: Availability of competent managers also
limits the extent of decentralization. When there is a scarcity of good
managers, greater is the tendency for centralization. On the other
hand, if they are available in adequate number, decentralization is
practicable.
22.7. Control Techniques: If there are sufficient control techniques,
decentralization is possible, because the performance of the
subordinate can be measured and corrective action can be taken. In
the absence of sufficient control, the tendency shall be towards
centralization.
23.8. Decentralized Performance: If the activities of the enterprise are
conducted at different places, authority is likely to be decentralized.
However, it does not mean that when the performance is
centralized, authority is centralized as well.
24. 9. Business Dynamics: The dynamic character also vitally affects the
degree to which authority may be decentralized. If the business is

36
 growing fast, decentralization becomes necessary. However, this
factor also depends upon the availability of competent managers.

What is Staffing?

25. Definition: Staffing can be defined as one of the most important

functions of management. It involves the process of filling the
vacant position of the right personnel at the right job, at right time.
Hence, everything will occur in the right manner.
26. It is a truth that human resource is one of the greatest for every
organization because in any organization all other resources like-
money, material, machine etc. can be utilized effectively and
efficiently by the positive efforts of human resource.
27. Therefore it is very important that each and every person should
get right position in the organization so as to get the right job,
according to their ability, talent, aptitude, and specializations so
that it will help the organization to achieve the pre-set goals in the
proper way by the 100% contribution of manpower. Thus it can be
said that it is staffing is an essential function of every business
organization. From this, we can understand what is Staffing?

Manpower management
Human resource management (HRM), or staffing, is the management
function devoted to acquiring, training, appraising, and compensating
employees. In effect, all managers are human resource managers,
although human resource specialists may perform some of these
activities in large organizations. Solid HRM practices can mold a
company's workforce into a motivated and committed team capable of

37
 managing change effectively and achieving the organizational
objectives.
Understanding the fundamentals of HRM can help any manager lead
more effectively. Every manager should understand the following
three principles:
• All managers are human resource managers.

5. Employees are much more important assets than buildings or equipment; good employees give
a company the competitive edge.

• Human resource management is a matching process; it must match the needs of the
organization with the needs of the employee.

Factors Affecting Staffing

The internal factors affecting staffing:

1. Promotion policy : Staffing is affected by the promotion policy of the organisation. If the organisation has a good
promotion policy with prospects to career growth and development, only then efficient people will be attracted to
the organisation. Internal promotions are better for lower and middle-level jobs. This is because it increases the
morale and motivation of the staff. However, for top level jobs, the ‘RIGHT’ person must be selected. The right
person may be from within the organisation, or he / she may be selected from outside.
2. Future growth plans : Staffing is also affected by the future growth plans of the organisation. If the organisation
wants to grow and expand then it will need many talented people. In order to grow and expand, the organisation
must select experts and give them continuous training and development.
3. Technology used : Staffing is also affected by the technology used by the organisation. If the organisation uses
modern technologies then it must have a continuous training programs to update the technical knowledge of their
staff.
4. Support from top management : Staffing is also affected by the support from Top Management. If the top
management gives full support to it then the organisation can have scientific selection procedures, scientific
promotion and transfer policies, continuous training programs, career development programs, etc.
5. Image of organisation : Staffing is also affected by the image of the organisation in the job market. If it has a
good image then staffing will attract the best employees and managers. An organisation earns a good image only
if it maintains good staffing policies and practices. This includes job security, training and development, promotion,
good working environment, work culture, etc.
The external factors affecting staffing:
1. Labor laws : Labor Laws of the government also affect the staffing policy of the organisation. For e.g. The
organisation has to support ‘Social equality and upliftment’ policies of the government by giving job reservations to

38
 candidates coming from depressed classes like scheduled castes (SC), scheduled tribes (ST), other backward
classes (OBC), etc., and even to those who are physically handicapped (PH). It is mandatory for an organisation
not to recruit children in their workforce and stop child labor. The provisions of ‘Minimum Wages Act’ guide an
organisation to fix minimum salaries of employees and stop their economic exploitation.
2. Pressure from socio-political groups : Staffing is also affected by activities of socio-political groups and parties.
These groups and parties put pressure on the organisation to grant jobs only to local people. The concept of ‘Sons
of Soil’ is becoming popular in India.
3. Competition : In India, there is a huge demand for highly qualified and experienced staff. This has resulted in
competition between different organisations to attract and hire efficient staff. Organisations often change their
staffing policies, offer attractive salaries and other job benefits in order to add the best minds in their workforce.
4. Educational standards : Staffing is also affected by the educational standards of an area. If the educational
standard of a place is very high then the organisation will only select qualified and experienced staff for all job
positions. For e.g. Some I.T. companies in India, only prefer skilled candidates with computer or I.T. Engineering
degree for the post of Software Developer.
5. Other external factors : Staffing is also affected by other external factors such as trade unions, social attitude
towards work, etc

Job Design
Definition: The Job Design means outlining the task, duties, responsibilities, qualifications,
methods and relationships required to perform the given set of a job. In other words, job design
encompasses the components of the task and the interaction pattern among the employees, with
the intent to satisfy both the organizational needs and the social needs of the jobholder.

The objective of a job design is to arrange the work in such a manner so as to reduce the
boredom and dissatisfaction among the employees, arising due to the repetitive nature of the
task.

There are several important methods and techniques that the management uses while designing
the jobs. These are:

39
1. Job Simplification
2. Job Rotation
3. Job Enrichment
4. Job Enlargement

What Is Selection in Staffing?

Selection in staffing is the part of the recruiting process that deals with choosing an employee
to hire from among a narrowed-down list of outstanding candidates. Selection can actually
occur several times throughout the recruiting process. Managers select which candidates to
contact based on their resumes, which candidates to bring in for an interview and finally which
applicants to hire for open positions. Understanding the different levels of selection and what to
look for at each level can help you to select the ideal job candidates for long-term success.

40
 Techniques for Staffing Firms to Use When Sourcing
Candidates

October 25, 2018

Debra Auerbach

As a recruiter at a staffing firm, you know that finding, contacting and securing a candidate
takes time. And in today’s competitive job market, you’re up against a lot of other companies
and staffing firms for top talent. These candidates are receiving tons of messages, so yours
must stand out and give them a reason to respond.

The best way to make sure you’re connecting with candidates is to ensure you’re contacting
the most relevant candidates in the first place. That all starts with good sourcing techniques.

Here are some of the common sourcing tactics used to mine databases, along with pros and
cons of each, and which one will get you the most bang for your buck.

A Simple Keyword Search

This is the easiest and most common way to search a database for candidates – simply typing
in a keyword or job title. Putting parenthesis around keywords helps narrow the results further
to ensure the full phrase is searched, as opposed to multiple words separately.

If you’re getting the results you want, there’s nothing wrong with using this method. The catch
here is that around 80 percent of recruiters use this method when searching for candidates,
meaning you’re finding, reviewing and contacting the same candidates as many of your peers.
So if you’re using this method, you’ll need refined messages so you stand out from your
competitors who are also targeting these top candidates.

Indirect Search
Recruitment industry expert Glen Cathey describes indirect search as “Searching for the
‘wrong’ people to find the ‘right’ people.” This essentially means making use of your current
database of candidates – even those not directly relevant to the job at hand – to help you find
and connect with candidates. For example, you may reach out to a sales account executive to
see if they know of a candidate who could be a fit for a sales enablement role. This technique
may be best applied when you have one or a few more specific types of roles you’re trying to
fill.

Boolean Search
Another type of search recruiters commonly use is Boolean, which relies on key operator words
and symbols to achieve the best results.

41
 Boolean combines or limits search terms, providing a more refined candidate search. Resume
databases or CRMs take your search string parameters and scan all content for the exact word
or phrase matches, and serve up relevant results that meet your specific search criteria.

In order to get the most out of Boolean, you’ll need to have a solid understanding of its logic so
you know exactly which types of positions —and related titles — to search for. So, it takes a bit
more work, and knowledge, than the average keyword search. However, it does help narrow
the pool of candidates so there are fewer, more relevant results.

Semantic Search
Sometimes the way job seekers describe themselves in their job application materials is
different than how recruiters and sourcers search for those same candidates in a database.
That’s where semantic search comes in. Semantic search technology applies related keywords
— such as job titles and skills — to each search term used, broadening your relevant results
and exposing you to all potentially relevant talent.

Semantic search is a good option for when you’re just starting your candidate search and want
to get a sense of your available talent pool. It’s also often used when sourcing for a position
with a wide variety of job titles.

A Combination of Methods
Oftentimes, the best way to find candidates is to use a combination of sourcing methods to
achieve optimal results. For instance, when a semantic search is layered on top of a Boolean
search string, related keywords are applied to all of the terms used in your search, casting an
even wider net to catch all relevant candidates associated to each of your search terms.

When researching resume databases, look for partners who offer solutions with the technology
to layer various search methods in order to get the best candidates – before your competition
does.

What is a Performance Appraisal

A performance appraisal is a regular review of an employee's job performance and overall

contribution to a company. Also known as an "annual review," "performance review or
evaluation," or "employee appraisal," a performance appraisal evaluates an employee’s skills,
achievements and growth, or lack thereof. Companies use performance appraisals to give
employees big-picture feedback on their work and to justify pay increases and bonuses, as well
as termination decisions. They can be conducted at any given time but tend to be annual,
semi-annual or quarterly

Objectives of Performance Appraisal

• To promote the employees, on the basis of performance and competence.
• To identify the requirement for training and development of employees.
• To provide confirmation to those employees who are hired as probationary employees, upon
completion of the term.
• To take a decision regarding the hike in employees pay, incentives etc.
• To facilitate communication between superior and subordinate.
• To help employees in understanding where they stand in terms of performance.

42
Data obtained from the appraisal of performance, are documented and used for
different organizational purposes.

Performance Appraisal Process

The figure shown above is a standard performance appraisal process that takes place
in an organization, wherein each step is important and arranged in a systematic
manner. The process is conducted periodically, usually twice a year, i.e. semi-annually
and annually called as mid-term review and annual review respectively.

Communications: Process, Importance, Types, Barriers

with Examples

Communication

Communications is fundamental to the existence and survival of humans as well as to an

organization. It is a process of creating and sharing ideas, information, views, facts, feelings,
etc. among the people to reach a common understanding. Communication is the key to the
Directing function of management.

43
 A manager may be highly qualified and skilled but if he does not possess good communication
skills, all his ability becomes irrelevant. A manager must communicate his directions effectively
to the subordinates to get the work done from them properly.

Communications Process
Communications is a continuous process which mainly involves three elements viz. sender,
message, and receiver. The elements involved in the communication process are explained
below in detail:

1. Sender
The sender or the communicator generates the message and conveys it to the receiver. He is
the source and the one who starts the communication

2. Message
It is the idea, information, view, fact, feeling, etc. that is generated by the sender and is then
intended to be communicated further.

3. Encoding
The message generated by the sender is encoded symbolically such as in the form of words,
pictures, gestures, etc. before it is being conveyed.

4. Media
It is the manner in which the encoded message is transmitted. The message may be
transmitted orally or in writing. The medium of communication includes telephone, internet,
post, fax, e-mail, etc. The choice of medium is decided by the sender.

5. Decoding
It is the process of converting the symbols encoded by the sender. After decoding the message
is received by the receiver.

6. Receiver
He is the person who is last in the chain and for whom the message was sent by the sender.
Once the receiver receives the message and understands it in proper perspective and acts
according to the message, only then the purpose of communication is successful.

44
 7. Feedback
Once the receiver confirms to the sender that he has received the message and understood it,
the process of communication is complete.

8. Noise
It refers to any obstruction that is caused by the sender, message or receiver during
the process of communication. For example, bad telephone connection, faulty encoding, faulty
decoding, inattentive receiver, poor understanding of message due to prejudice or
inappropriate gestures, etc.

(Source: businessjargons)

Importance of Communication

1. The Basis of Co-ordination

The manager explains to the employees the organizational goals, modes of their achievement
and also the interpersonal relationships amongst them. This provides coordination between
various employees and also departments. Thus, communications act as a basis for
coordination in the organization.

2. Fluent Working
A manager coordinates the human and physical elements of an organization to run it smoothly
and efficiently. This coordination is not possible without proper communication.

45
 3. The Basis of Decision Making
Proper communication provides information to the manager that is useful for decision making.
No decisions could be taken in the absence of information. Thus, communication is the basis
for taking the right decisions.

4. Increases Managerial Efficiency

The manager conveys the targets and issues instructions and allocates jobs to
the subordinates. All of these aspects involve communication. Thus, communication is
essential for the quick and effective performance of the managers and the entire organization.

5. Increases Cooperation and Organizational

Peace
The two-way communication process promotes co-operation and mutual understanding
amongst the workers and also between them and the management. This leads to less friction
and thus leads to industrial peace in the factory and efficient operations.

6. Boosts Morale of the Employees

Good communication helps the workers to adjust to the physical and social aspect of work. It
also improves good human relations in the industry. An efficient system of communication
enables the management to motivate, influence and satisfy the subordinates which in turn
boosts their morale and keeps them motivated.

Types of Communication

1. Formal Communication
Formal communications are the one which flows through the official channels designed in the
organizational chart. It may take place between a superior and a subordinate, a subordinate
and a superior or among the same cadre employees or managers. These communications can
be oral or in writing and are generally recorded and filed in the office.

Formal communication may be further classified as Vertical communication and Horizontal

communication.

Vertical Communication
Vertical Communications as the name suggests flows vertically upwards or downwards through
formal channels. Upward communication refers to the flow of communication from a
subordinate to a superior whereas downward communication flows from a superior to a
subordinate.

46
 Application for grant of leave, submission of a progress report, request for loans etc. are some
of the examples of upward communication. Sending notice to employees to attend a meeting,
delegating work to the subordinates, informing them about the company policies, etc. are some
examples of downward communication.

Horizontal Communication
Horizontal or lateral communication takes place between one division and another. For
example, a production manager may contact the finance manager to discuss the delivery of
raw material or its purchase.

Types of communication networks in formal

communication:
• Single chain: In this type of network communications flows from every superior to his
subordinate through a single chain.
• Wheel: In this network, all subordinates under one superior communicate through him
only. They are not allowed to talk among themselves.
• Circular: In this type of network, the communication moves in a circle. Each person is
able to communicate with his adjoining two persons only.
• Free flow: In this network, each person can communicate with any other person freely.
There is no restriction.
• Inverted V: In this type of network, a subordinate is allowed to communicate with his
immediate superior as well as his superior’s superior also. However, in the latter case,
only ordained communication takes place.

2. Informal Communication
Any communication that takes place without following the formal channels of communication is
said to be informal communication. The Informal communication is often referred to as the
‘grapevine’ as it spreads throughout the organization and in all directions without any regard to
the levels of authority.

The informal communication spreads rapidly, often gets distorted and it is very difficult to detect
the source of such communication. It also leads to rumors which are not true. People’s
behavior is often affected by the rumors and informal discussions which sometimes may
hamper the work environment.

However, sometimes these channels may be helpful as they carry information rapidly and,
therefore, may be useful to the manager at times. Informal channels are also used by the
managers to transmit information in order to know the reactions of his/her subordinates.

Types of Grapevine network:

• Single strand: In this network, each person communicates with the other in a sequence.
• Gossip network: In this type of network, each person communicates with all other
persons on a non-selective basis.

47
 • Probability network: In this network, the individual communicates randomly with other
individuals.
• Cluster Network: In this network, the individual communicates with only those people
whom he trusts. Out of these four types of networks, the Cluster network is the most
popular in organizations.

Barriers to Communication
The communication barriers may prevent communication or carry incorrect meaning due to
which misunderstandings may be created. Therefore, it is essential for a manager to identify
such barriers and take appropriate measures to overcome them. The barriers to
communication in organizations can be broadly grouped as follows:

1. Semantic Barriers
These are concerned with the problems and obstructions in the process of encoding and
decoding of a message into words or impressions. Normally, such barriers result due to use of
wrong words, faulty translations, different interpretations, etc.

For example, a manager has to communicate with workers who have no knowledge of the
English language and on the other side, he is not well conversant with the Hindi language.
Here, language is a barrier to communication as the manager may not be able to communicate
properly with the workers.

2. Psychological Barriers
Emotional or psychological factors also act as barriers to communication. The state of mind of
both sender and receiver of communication reflects in effective communication. A worried
person cannot communicate properly and an angry recipient cannot understand the message
properly.

Thus, at the time of communication, both the sender and the receiver need to be
psychologically sound. Also, they should trust each other. If they do not believe each other,
they cannot understand each other’s message in its original sense.

3. Organizational Barriers
The factors related to organizational structure, rules and regulations authority relationships, etc.
may sometimes act as barriers to effective communication. In an organization with a highly
centralized pattern, people may not be encouraged to have free communication. Also, rigid
rules and regulations and cumbersome procedures may also become a hurdle to
communication.

4. Personal Barriers
The personal factors of both sender and receiver may act as a barrier to effective
communication. If a superior thinks that a particular communication may adversely affect his
authority, he may suppress such communication.

48
 Also, if the superiors do not have confidence in the competency of their subordinates, they may
not ask for their advice. The subordinates may not be willing to offer useful suggestions in the
absence of any reward or appreciation for a good suggestion.

Solved Question for You

Q: List the measures to improve communication effectiveness?

Answer: Measures to improve communication effectiveness are as follows

1. Communication of Clarification of the idea.

2. Communication should be according to the needs of the receiver.
3. Consulting others before communication.
4. Awareness about the language, tone and body postures and gestures.
5. Convey information useful to the receiver.
6. Ensure proper feedback.
7. Follow up communications.
8. Be a good listener.

Controlling

Definition: Control is a primary goal-oriented function of management in an

organisation. It is a process of comparing the actual performance with the set
standards of the company to ensure that activities are performed according to the
plans and if not then taking corrective action.

Every manager needs to monitor and evaluate the activities of his subordinates. It helps
in taking corrective actions by the manager in the given timeline to avoid contingency or
company’s loss.

Controlling is performed at the lower, middle and upper levels of the management.

Process of Controlling

Control process involves the following steps as shown in the figure:

• Establishing standards: This means setting up of the target which needs to be achieved to
meet organisational goals eventually. Standards indicate the criteria of performance.

49
 Control standards are categorized as quantitative and qualitative standards. Quantitative
standards are expressed in terms of money. Qualitative standards, on the other hand,
includes intangible items.

• Measurement of actual performance: The actual performance of the employee is

measured against the target. With the increasing levels of management, the measurement
of performance becomes difficult.
• Comparison of actual performance with the standard: This compares the degree of
difference between the actual performance and the standard.
• Taking corrective actions: It is initiated by the manager who corrects any defects in actual
performance.

Controlling process thus regulates companies’ activities so that actual performance

conforms to the standard plan. An effective control system enables managers to avoid
circumstances which cause the company’s loss.

Types of control
There are three types of control viz.,

1. Feedback Control: This process involves collecting information about a finished task,
assessing that information and improvising the same type of tasks in the future.
2. Concurrent control: It is also called real-time control. It checks any problem and examines
it to take action before any loss is incurred. Example: control chart.
3. Predictive/ feedforward control: This type of control helps to foresee problem ahead of
occurrence. Therefore action can be taken before such a circumstance arises.

In an ever-changing and complex environment, controlling forms an integral part of the

organization.

Barriers to Successful Controlling

• Control activities may unnecessarily create an overemphasis on

short term goals neglecting long term goals.
• Control activities may frustrate employees by putting a check
on their freedom.This type of reaction tends to occur primarily
where management exerts too much control.
• Control activities may result in manipulations and tempering
with the facts.It may encourage falsification of reports.
• Control activities may hamper the creativity of the individuals
which ultimately lead to narrowing the perspectives of
organisational members.

50
• Control activities may not show their effectiveness where
proper standards have not been set and faulty evaluation systems
are there.
• Control activities may show their ineffectiveness in an
environment where there is fear of discrimination and favourism.
• Control activities go against the basic fundamental belief
system or ideology of human being then also,they won't be
effective.
Methods and Techniques of Controlling
1. Budgetary Control
Budgeting is the formulation of plans for a given future period in
numerical terms.Budget can be called as the statement of
anticipated results in financial terms: as in revenue and expense and
capital budgets or in no financial terms: as in labour
hours,materials,physical sales volume of units or production.
There are following types of budgets such as

1. Revenue and expense budgets.

2. Time,space,material and product budgets.
3. Capital expenditure budgets.
4. Cash budgets.
5. Balance sheet budgets.
6. Budget summaries.
7. Few-base budgeting
2. Traditional Method
There are few traditional or no budgetary control devices: Among
the most important of these are
1. Statistical data.
2. Special reports and analysis.
3. Analysis of break-even points.
4. The operational audit.
5. The personal observation.
3. Modern Techniques

51
There are many advanced and quantitative techniques and devices
available in this modern world to control such as
1. Programme Evaluation and Review Technique(PERT)
2. Control through Return on Investment(ROI)
3. Just-In-Time Inventory Control (JIT)
4. Ratio-analysis is the process of generating information
that summaries the financial position of an organisation
through the calculation of ratios.
5. Decision tree analysis is statistical and graphical multi-
phased decision making technique that can be used in
controlling.
6. Computer Aided Design (CAD)
7. Computer Aided Manufacturing (CAM)
Non-Budgetary Control Techniques

28. There are, of course, many traditional control devices not connected with budgets,
although some may be related to, and used with, budgetary controls. Among the most
important of these are statistical data, special reports and analysis, analysis of break- even
points, the operational audit, and the personal observation.
29. 1 Statistical data:
30. Statistical analyses of innumerable aspects of a business operation and the clear
presentation of statistical data, whether of a historical or forecast nature are, of course,
important to control. Some managers can readily interpret tabular statistical data, but most
managers prefer presentation of the data on charts.
31. 2 Break- even point analysis:
32. An interesting control device is the break even chart. This chart depicts the
relationship of sales and expenses in such a way as to show at what volume revenues
exactly cover expenses.
33. 3 Operational audit:
34. Another effective tool of managerial control is the internal audit or, as it is now
coming to be called, the operational audit. Operational auditing, in its broadest sense, is
the regular and independent appraisal, by a staff of internal auditors, of the accounting,
financial, and other operations of a business.
35. 4 Personal observation:
36. In any preoccupation with the devices of managerial control, one should never
overlook the importance of control through personal observation.

52
53