Fucntions of Management

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Functions of

Management
th
B.Tech 4 Year
By: Dr. Geeta Sachdeva
Asst. Prof.
Dept. of Hum. & S.S.
NIT Kurukshetra
Functions of Management
Management is a set of principles relating to the functions of planning, organizing,
directing, and controlling, and the applications of these principles in harnessing
physical, financial, human, and informational resources efficiently and effectively to
achieve organizational goals in efficient manner.

There are basically five primary functions of management. These are:

1. Planning
2. Organizing
3. Staffing
4. Directing
5. Controlling
Planning contd.
Planning is an activity. It can be considered as consisting of a process.

It is a process involves the determination of future course of action, that is why an


action, what action, how to take action and when to take action.

Why- It has some objectives

What- It specifies activities to be taken

How & When- generate various policies, programs and procedures.

Plan is commitment to a particular course of action.


Planning contd.
Planning is future-oriented and determines an organization’s direction. It is a rational
and systematic way of making decisions today that will affect the future of the
company. It is a kind of organized foresight as well as corrective hindsight. It involves
predicting of the future as well as attempting to control the events. It involves the
ability to foresee the effects of current actions in the long run in the future.

Peter Drucker has defined planning as follows:

“Planning is the continuous process of making present entrepreneurial decisions


systematically and with best possible knowledge of their futurity, organizing
systematically the efforts needed to carry out these decisions and measuring the
results of these decisions against the expectations through organized and
systematic feedback”.
Nature of Planning
• A Rational Approach

• Open System approach- Managers have to take into account the dynamic features of
environment.

• Pervasive approach
Types of Planning
• Corporate vs. Functional Panning:

Corporate planning deals with planning activates at top level. It determines the long
term objectives and generate plans to achieve these objectives.

Functional Planning: it is segmental planning and it is undertaken for major functional


departments of the organization like production, marketing, finance, human resource
department etc.

• Strategic Planning vs. Operational Planning

Strategic planning involves the analysis of various environmental factors. It focuses on


external environment.

Operational Planning is a short term planning usually covers one year or so. It is
undertaken out of strategic planning. It focuses on internal environment.
Types of Plans
• Standing Plans and Single use plans-

Standing plans provide guidelines for further course of action and are used over a period
of time. Once formulated these plans are used for a long period.

For example- Organization’s mission, Vision and long term objectives.

Single use plans- are relevant for a specified time and after the lapse of the time these
plans are formulated again for next period.

For example- Projects, budgets, targets etc.


Importance of Planning
Planning increase efficiency –Planning makes optimum utilization of all available
resources. It helps to reduce wastage and avoids duplication of work.

Planning reduces business related risks- Planning helps to forecast the business related
risk and also helps to take necessary precautions to avoid these risks and prepare for
future uncertainties

Planning provides direction – Direction means to give proper information, accurate


instructions and guidance to the subordinates. Planning tells us what to do, how to do
and when to do . It help the organization to achieve the goals through systematic
coordination of the employees.
Importance of Planning contd..
• Planning helps in motivation

• Planning helps in decision making – A manager makes many different plans. Then
they evaluate every course of action and choose the best strategy. So decision making
is facilitated by planning.

• Planning helps to achieve objectives- Without Planning each and every activity will
be based on trial and error which will give rise to confusion Every organization has
certain targets. Planning helps an organization to achieve their aims by avoiding
overlapping, confusion and misunderstanding.
Importance of Planning contd..
• Planning provides basis of control-Planning is the first function of management. The
other functions like organising, staffing, directing and controlling etc. are organized
for implementing plans. Controlling records the actual performance and compares it
with standards set. In case the performance is less than the standards set then
deviations are ascertained and proper corrective measures are taken to improve the
performance in future. Planning and controlling both are dependent on each other.
Planning establishes standards for controlling. Therefore, Planning is necessary for
effective and efficient functioning of every organisation irrespective of its size,
type and objectives.
Steps in Planning Process
• Establishing verifiable goals- The first step in planning is to determine the enterprise
objectives. These are more often set by upper level managers. The objective may vary
from a desired sales volume or growth rate to development of a new product.

• Establishing Planning Premises- Plans are made to operate in the future. The second
step in planning is to establish planning premises i.e. assumption on the basis of which
plans will be ultimately formulated. Planning premises are vital to the success of
planning as they supply important facts and information related to future like
population trends, economic condition, production cost, government control etc.

• Deciding the Planning Period –The next task is to decide the period of the plan
whether it’s a yearly plan or a plan which is spread over for longer span of time.
Choice of planning period is decided based on time required in development of new
product, time required to recover capital investment and length of commitments
already made.
Steps in Planning Process contd..
• Finding alternative course of action – The next in planning is to search for and examine
alternative course of action. For Ex-Products may be sold directly to the consumers by the
company’s salesman or through exclusive agencies.

• Evaluating and selecting a course of action- Having searched the alternative courses, the
next step is to evaluate and analyse them in the light of premises and goals and select the
best alternative. This is done with the help of quantitative techniques and operations
research.

• Implementing the Plan- The best possible course of action has now to be implemented i.e.
putting the plan into action . For this the managers have to develop derivative plans for each
department. A draft version of the action plan should be communicated to inform those
directly affected and gain their cooperation.

• Measuring and Controlling the Programme –The process of controlling is a critical part of
any plan. Managers need to check the progress of their plans i.e. follow up, so that they can
take remedial action if the plan is not working as per schedule or change the original plan if
it is unrealistic.
Organizing
After planning the next function of management is organising. Organising involves
division of work among people whose efforts must be coordinated to achieve specific
objectives and to implement pre-determined strategies. It is the backbone of
management. After the objectives of an enterprise are determined and the plan is
prepared, the next step in the management process is to organize the activities of the
enterprise.

According to Louis Allen "Organising is the process of identifying and grouping the work to
be performed defining and delegating responsibility and authority, and establishing
relationships for the purpose of enabling people to work most effectively together in
accomplishing objectives."
Importance of Organizing
• It facilitates efficient management - Organising is necessary for the performance of
other functions of management .Poor organisation may result in duplication of work
and efforts.

• It facilitates coordination and communication - Organisation creates a clear cut


relationships between the departments and helps in laying down balanced emphasis on
various activities. It also provides channels of communication and coordination of
activities of different departments.

• It facilitates growth and diversification- Sound organization helps in the growth and
expansion of the enterprise by facilitating its efficient management .It also increases
the capacity of the enterprise to undertake more activities.
Importance of Organizing
• It ensures optimum use of resources -Organising leads to the optimum use of all
material, financial and human resources. It matches the jobs with the individuals and
vice versa and ensures that job position is clearly defined. It minimizes confusion and
wastage of resources.

• It provides for optimum use of technological innovations-Sound organisation structure


is not rigid. It is flexible and provides adequate scope for adoption of new technology.

• It facilitates specialization- Organising provides a great scope for bringing


specialization in every department of an enterprise through proper allocation of jobs
among the employees.

• Organising thus can be understood in two ways:

• 1. Organising as a process

• 2. Organising as a structure
Organizing as a Process
It refers to the way in which the work of a group is arranged and distributed among
members to efficiently achieve the objectives. It creates a relationship of one job to
another and lays down the scope of authority and responsibility. The duties are fixed in
such a manner so that the work is performed with speed, accuracy and economy.
Steps in the Process of Organizing
• Determination of objectives - The purpose of the organisation must be identified.
Objectives determine resources and various activities which should be done to achieve
the organisational goals.

• Identification and grouping of activities- If group members are to pool their efforts
successfully, there must be proper division of the major activities. Each job should be
accurately classified and grouped. This will avoid duplication of work.

• Assignment of duties- After grouping the activities into various jobs, as per the nature
of work, Similar activities should be placed under one department . Each individual
should be given a particular task according to his ability and skills.
Steps in the Process of Organizing contd.
• Establishing relationship among individuals and group- The activities which are
performed by person holding different positions must be related. Every person in the
organisation should know about his responsibility, authority and accountability so that
there is coordination, among individuals and departments. The organizing process
results in organization structure with precisely defined authority and responsibilities.
Organisation Structure
An Organisation Structure shows the authority responsibility relationship between the
various positions in the organization by showing who reports whom, It lays down the
pattern of communication and coordination in the enterprise. It facilitates growth of the
enterprise by increasing capacity to handle diversified situations. Organisation structure
is usually shown on an organisation chart. There are basically 2 types of organization
structure.

1. Functional Structure

2. Divisional Structure
Functional Structure
Functional structure- This type of organization structure is formed by grouping together
all activities into functional department and putting each department under one head.
Functional structure leads to specialization. It promotes efficiency and results in
increased profits. Its suitable to organization where operations require high degree of
specialization . For example –A steel manufacturing Company has divided its structure
into Manufacturing, Finance, Marketing Personnel, Research and Development, as it has
diversified activities and its operation require a high degree of specialization.
Functional Structure contd..
Divisional Structure
Divisional Structure- Large Companies often find it to operate as one large unit under a
functional organizational structure. The size of the company makes it difficult for
managers to oversee operations and screen customers. To overcome this problem, most
large companies are now structured as divisional organisations. Each division functions
relatively autonomously because it contains most of the functional expertise under each
unit. Division can be formed according to product, customers, processes or geographical
division.

One example of this is a company like General Electric. GE has many different divisions
including aviation, transportation, currents, digital and renewable energy, among others.
Under this structure, each division essentially operates as its own company, controlling
its own resources and how much money it spends on certain projects or aspects of the
division.
Divisional Structure contd..
Matrix Structure
A hybrid organizational structure, the matrix structure is a blend of the functional
organizational structure and the projectized organizational structure.

In the matrix structure, employees may report to two or more bosses depending on the
situation or project. For example, under normal functional circumstances, an engineer at
a large engineering firm could work for one boss, but a new project may arise where that
engineer’s expertise is needed. For the duration of that project, the employee would
also report to that project’s manager, as well as his or her boss for all other daily tasks.

The matrix structure is challenging because it can be tough reporting to multiple bosses
and knowing what to communicate to them. That’s why it’s very important for the
employees to know their roles, responsibilities and work priorities.

Advantages of this structure is that employees can share their knowledge across the
different functional divisions, allowing for better communication and understanding of
each function’s role. And by working across functions, employees can broaden their skills
and knowledge, leading to professional growth within the company.
Matrix Structure
Virtual Organizational Structure
Is also known as digital organisation, network organisation or modular organisation.
Simply speaking, a virtual organisation is a network of cooperation made possible by,
what is called ICT, i.e. Information and Communication Technology, which is flexible and
comes to meet the dynamics of the market.

Alternatively speaking, the virtual organisation is a social network in which all the
horizontal and vertical boundaries are removed. In this sense, it is a boundary less
organisation. It consists of individual’s working out of physically dispersed work places, or
even individuals working from mobile devices and not tied to any particular workspace.
The ICT is the backbone of virtual organisation.
Virtual Organizational Structure contd.
Organisations may have several options like flexi-time, part-time work, job-sharing, and
home-based working.

Types of Virtual Organizations

• Telecommuters
• Outsourcing employees/competencies
• Completely virtual
Telecommuters:
These companies have employees who work from their homes.
Outsourcing Employees/Competencies:
These companies are characterised by the outsourcing of all/most core competencies.
Areas for outsourcing include marketing and sales, human resources, finance, research
and development, engineering, manufacturing, information system, etc.
Completely Virtual:
These companies metaphorically described as companies without walls that are tightly
linked to a large network of suppliers, distributors, retailers and customers
Staffing
After planning and organizing the next function of management is ‘Staffing’ .It is
important to have a good organization structure, but it is even more important to fill the
jobs with the right people. Filling and keeping the position provided for by the
organization structure with right people at the right place is the staffing phase of the
management function. All the managers have a responsibility for staffing.

The staffing function deals with the human elements of management. The staffing
function has assumed great importance these days because of rapid advancement of
technology, increasing size of organizations and complex behaviour of human beings.

According to Koontz and O’Donnell, “Staffing involves manning the organization


structure through proper and effective selection appraisal and development of personal
to fill the roles designed into the structure.”
Staffing Process
• Manpower planning- Estimation of manpower requirements in the future is the first
stage in the staffing process. It is known as manpower or human resources planning.
Its purpose is to make right kind of personnel available so that there is no surplus or
shortage of people in any department. To determine the qualifications needed to
meet the requirements of jobs, the organisation first of all has to analyse the jobs,
write the jobs description and prepare job specifications.

• Recruitment - Once the requirement of manpower is known, the process of


recruitment starts. It is the process of identifying the sources for prospective
candidates and to stimulate them to apply for the jobs. It is a positive process as it
attracts suitable candidates to apply for available jobs. The process of recruitment
and the cost involved in it depends on the size of the undertaking and the type of
persons to be recruited. The sources of recruitment can be a) Internal sources
(recruitment from within the enterprise) b) External Sources(recruitment from outside
)
Sources of Recruitment
Staffing Process contd..
• Selection -The process of selection leads to employment of persons who possess the
ability and qualifications to perform the jobs which have fallen vacant in the
organisation. Selection is frequently described as a negative process as it eliminates
all the candidates those who do not match up to the requirements of the job offered.
As the employees are placed in the jobs for which they are best suited, they derive
maximum job satisfaction reducing the labour turnover and increasing the overall
efficiency of the organization. The candidates have to go through the whole selection
process of an organization i.e. interviews, tests, medical examination etc.
Staffing Process contd..
• Placement- The candidate selected for appointment are to be offered specific jobs. A
personnel should be placed on a position where there is full use of his strength and
capabilities. Proper placement reduces absenteeism and turnover.

• Induction and Orientation-Induction is the process of familiarizing a new employee


to the new workplace, surroundings, company’s rule and regulations. Induction
programme is generally informal in case of small organization. But in large
organization the orientation or induction is carried on formally so that the new
employee develops a favourable attitude towards the company.

• Training and Development- Training is an organized activity for increasing the


knowledge and skills of people for a definite purpose .Its purpose is to achieve a
change in the behaviour of the employees and to enable them to do their jobs better.
The initiative for training usually comes from the management. Development
emphasizes on growth of an individual. It’s a continuous process Development helps in
overall growth of the employee.
Staffing Process contd..
• Performance Appraisal- It refers to all the formal procedures used in an organization
to evaluate the employees and their contributions. It also reveals as to how efficiently
the subordinate is performing his job and to know his aptitudes and other qualities
necessary for performing the job assigned to him.

• Promotion and Transfers- Promotion refers to being placed at a higher job position
with more salary, job satisfaction and responsibility. On the basis of feedback report
of employees performance they are given promotion and other opportunities Transfer
means shifting of an employees from one job to another or one department to other.
Transfer may take place due to change in organization structure or changes in the
volume of work.
Directing
Directing is concerned with the initiation of organized action and stimulating people to
work. It involves issuance of orders, instructions and leading and motivating the
employees to execute them. Directing is the inter-personal aspect of management which
deals directly with influencing, guiding, supervising and motivating the subordinates for
the accomplishment of pre-determined objectives. Planning, organizing, staffing are
merely preparations for doing the work but the work actually initiates through directing
function.

The manager must stimulate action by giving direction to his subordinates through orders
and also supervise their work to ensure that the plans and policies achieve the desired
actions and results.
Elements of Directing
• Directing deals with inter-personal relations. It is the doing or implementing phase of
management. Hence it is also called management-in-action. All the activities related
to directing can be categorized into 4 different elements of directing. They are:

• Supervision

• Motivation

• Communication

• Leadership.
Supervision
It refers to the process where the activities of workers are guided towards the
pre-determined objectives. It involves directly overseeing the work of workers. It
ensures that work is carried out efficiently and towards the desired objectives through
effective supervision. Good supervision helps in maintaining harmony and unity among
workers.

Highly Closed Supervision

Less Closed Supervision


Role of Supervisor
• Plays the role of a guide, friend and philosopher to workers.

• Guides workers and provides them support. He ensures that workers work with harmony and
unity. In case of internal differences, the manager tries to sort it out and bring about a
feasible solution.

• Serves as the link of communication between the manager and workers. While on one hand,
he communicates the information and ideas of the management to workers, on the other
hand, he communicates the problems of workers to managers. In other words, the
management and workers communicate through the supervisor.

• Responsibility of the supervisor to ensure that the work is carried out efficiently and smoothly
and that the set targets are met.

• The knowledge or skill along with on-job training as required by workers for various activities
is provided by the supervisor.

• A good supervisor successfully influences employees and sets a high standard of morale
among workers.
Motivation
Motivation means incitement or inducement to act or move. In the context of an
organisation, it means the process of making subordinates to act in a desired manner to
achieve certain organisational goals.

Features of Motivation:

• Motivation is an invisible force: Motivation is an internal feeling. It cannot be seen or


touched. This internal feeling urges employees to behave in a particular manner. Its
results can clearly be felt among employees through their performance. For example,
a desire (internal feeling) to buy a new car, recognition in the company etc.

• Motivation helps in achieving goals: Motivation directs an employee towards goals. It is


a positive awakening force which increases the productivity and quality standards of
work done by employees.
Motivation contd..
• Motivation can also be negative: Positive motivation can take the form of appraisal or
promotion. On the other hand, negative motivation can take the form of pay-cut and
demotion. Both these types of motivation help to make employees work in the desired
way.

• Motivation is not a simple process: Different individuals have different needs and
expectations. Hence, all employees get motivated for different reasons at different
times. Some employees get motivated by appreciation, whereas some employees get
motivated by appraisals.

• Motivation Can be financial and non financial


Maslow's Need Hierarchy Theory of
Motivation
• Maslow's hierarchy of needs helps in understanding the phenomenon of motivation.

• According to Maslow, the needs of an individual can be classified into five categories
which can be arranged in a hierarchical order.

• With the knowledge of these needs, a manager can better understand the behaviour
of employees in the organisation and accordingly provide appropriate motivation.
Hierarchy of needs as given by Maslow
1. Basic Physiological Needs: These needs are the most basic needs in the need hierarchy. It
comprises needs which are essential for survival and sustenance. For example, the need for
food, clothing and shelter. In terms of an organisation, the requirement of a basic salary is a
basic physiological need.

2. Security Needs: An individual requires physical as well as emotional security. For example,
an employee wishes for job security and stability in income.

3. Belonging Needs: It refers to the social needs of an individual in terms of affection,


friendship and acceptance. In other words, it refers to a feeling of belongingness to society.

4. Esteem Needs: It comprises elements such as respect, dignity and recognition in the peer
group.

5. Self-Actualisation Needs: Every individual wishes to achieve what he aims or aspires. For an
employee, it includes factors such as recognition of work, autonomy and growth. It must
however be noted that it may happen that the needs of an individual are not in the exact
order of the hierarchy. Nevertheless, a good understanding of needs helps managers in using
effective motivation
Communication
It is the process of passing information, view point, facts, ideas , opinion and
understanding from one person to another .It is a two way process and is complete when
there is some response from the receiver of information. Communication may take
several forms like order, instructions, report, suggestion etc.

Communication plays key role in the success of a manager. How much professional
knowledge and intelligence a manager possesses becomes immaterial if he is not able to
communicate effectively with his subordinates and create understanding in them.
Directing abilities of a manager mainly depend upon his communication skills. That is why
organisation always emphasise on improving communication skills of managers as well as
employees.
Importance of Communication
• Acts as basis of coordination: Communication acts as basis of coordination. It
provides coordination among departments, activities and persons in the organisation.

• Helps in smooth working of an enterprise: Communication makes possible for the


smooth and unrestricted working of the enterprise. All organisational interactions
depend on communications.

• Acts as basis of decision making: Communication provides needed information for


decision making. In its absence, it may not be possible for the managers to take any
meaningful decision.

• Increases managerial efficiency: Communication is essential for quick and effective


performance of managerial functions. The management conveys the goals and targets,
issues instructions, allocates jobs and responsibilities and looks after the performance
of subordinates.
Importance of Communication contd..
• Promotes cooperation and industrial peace: Efficient operation is the aim of all
prudent management. It may be possible only when there is industrial peace in the
factory and mutual cooperation between management and workers. The two way
communication promotes cooperation and mutual understanding between the
management and workers.

• Boosts morale and provides motivation: An efficient system of communication


enables management to motivate, influence and satisfy the subordinates. Good
communication assists the workers in their adjustment with the physical and social
aspect of work. It improves good human relations in industry.
Formal Communication
Formal communication flows through official channels designed in the organisation
chart. This communication may take place between a superior and subordinate, a
subordinate and superior or among same cadre employees or managers. The
communications may be oral or written but generally recorded and filed in the office.

Formal communication may be further classified as – Vertical and Horizontal

Vertical communication flows vertically i.e., upwards or downwards through formal


channels. Upward communication refer to flow of communication from subordinate to
superior whereas downward communication indicates communication from a superior to
subordinate. The examples of upward communication are – application for grant of leave,
submission of progress report, request for grants etc. Similarly, the examples of
downward communication include – sending notice to employees to attend a meeting,
ordering subordinates to complete an assigned work, passing on guidelines framed by top
management to the subordinates etc.
Formal & Informal Communication contd..
Horizontal or lateral communication takes place between one division and another. For
example, a production manager may contact marketing manager to discuss about
schedule of product delivery, product design, quality etc.
Informal Communication
Communication that takes place without following the formal lines of communication is
said to be informal communication. Informal system of communication is generally
referred to as the ‘grapevine’ because it spreads throughout the organisation with its
branches going out in all directions in utter disregard to the levels of authority.
Barriers to Effective Communication
• Semantic barriers: Semantics is the branch of linguistics dealing with the meaning of words
and sentences. Such barriers result on account of use of wrong words, faulty translations,
different interpretations etc.

• Psychological barriers: Emotional or psychological factors acts as barriers to communicators.


For example, a worried person cannot communicate properly and an angry receiver cannot
understand the real meaning of message. The state of mind of both sender and receiver of
communication reflects in the effective communication. Some of the psychological barriers
are:

i. Premature evaluation: Some times people evaluate the meaning of message before the
sender completes his message. Such premature evaluation may be due to pre-conceived
notions or prejudices

ii. Lack of attention: The preoccupied mind of receiver and the resultant non-listening of
message acts as a major psychological barrier. For instance, an employee explains about his
problems to the boss who is pre-occupied with an important file before him. The boss does
not grasp the message and the employee is disappointed.
Barriers to Effective Communication contd.
iii. Loss by transmission and poor retention: When communication passes through
various levels, successive transmissions of the message results in loss of, or transmission
of inaccurate information. This is more so in case of oral communication. Poor retention
is another problem.

iv) Distrust: Distrust between communicator and communicate acts as a barrier. If the
parties do not believe each other, they can not understand each others message in its
original sense.

• Organizational Barriers: The factors related to organisation structure, authority


relationships, rules and regulations may, sometimes, act as barriers to effective
communication. Some of these barriers are:

• (i) Organisational policy: If the organisational policy, explicit or implicit, is not


supportive to free flow of communication, it may hamper effectiveness of
communications. For example, in an organisation with highly centralised pattern,
people may not be encouraged to have free communication.
Barriers to Effective Communication contd.
(ii) Rules and regulations: Rigid rules and cumbersome procedures may be a hurdle to
communication. Similarly, communications through prescribed channel may result in
delays.

(iii) Status: Status of superior may create psychological distance between him and his
subordinates. A status conscious manager also may not allow his subordinates to express
their feelings freely.

(iv) Complexity in organisation structure: In an organisation where there are number of


managerial levels, communication gets delayed and distorted.
Barriers to Effective Communication contd.
• Personal Barriers: the personal factors of both sender and receiver may exert
influence on effective communication. Some of the personal barriers of superiors and
subordinates are mentioned below:

• (i) Fear of challenge to authority: If a superior perceives that a particular


communication may adversely affect his authority, he or she may withhold or suppress
such communication.

• (ii) Lack of confidence of superior on his subordinates: If superiors do not have


confidence on the competency of their subordinates, they may not seek their advice
or opinions.

• (iii) Unwillingness to communicate: Sometimes, subordinates may not be prepared to


communicate with their superiors, if they perceive that it may adversely affect their
interests.
Barriers to Effective Communication contd.
• (iv) Lack of proper incentives: If there is no motivation or incentive for
communication, subordinates may not take initiative to communicate. For example, if
there is no reward or appreciation for a good suggestion, the subordinates may not be
willing to offer useful suggestions
Improving Communication Effectiveness
• Clarify the ideas before communication: The problem to be communicated to
subordinates should be clear in all its perspective to the executive himself. The entire
problem should be studied in depth, analysed and stated in such a manner that is
clearly conveyed to subordinates.

• Communicate according to the needs of receiver: The level of understanding of


receiver should be crystal clear to the communicator. Manager should adjust his
communication according to the education and understanding levels of subordinates.

• Consult others before communicating: Before actually communicating the message,


it is better to involve others in developing a plan for communication. Participation and
involvement of subordinates may help to gain ready acceptance and willing
cooperation of subordinates.
Improving Communication Effectiveness contd.
• Be aware of languages, tone and content of message: The contents of the message,
tone, language used, manner in which the message is to be communicated are the
important aspects of effective communication. The language used should be
understandable to the receiver and should not offend the sentiments of listeners.

• Convey things of help and value to listeners: While conveying message to others, it is
better to know the interests and needs of the people with whom you are
communicating.

• Ensure proper feedback: The communicator may ensure the success of


communication by asking questions regarding the message conveyed. The receiver of
communication may also be encouraged to respond to communication.

• Be a good listener: Manager should be a good listener. Patient and attentive listening
solves half of the problems.
Leadership
• Leadership may be defined as the process by which a manager guides and influences
the work of his subordinates. The success of every enterprise is dependent upon the
quality of its leadership.

The importance of leadership:

(i) Leadership influences the behaviour of people and makes them to positively
contribute their energies for the benefit of the organisation.

(ii) A leader maintains personal relations and helps followers in fulfilling their needs. He
provides needed confidence, support and encouragement and thereby creates
congenial work environment.

(iii) Leader plays a key role in introducing required changes in the organisation. He
persuades, clarifies and inspires people to accept changes whole-heartedly.

(iv) A leader handles conflicts effectively and does not allow adverse effects resulting
from the conflicts.
Qualities of Good Leaders
• (i) Physical features: Physical features like height, weight, health, appearance
determine the physical personality of an individual. It is believed that good physical
features attract people.

• (ii) Knowledge: A good leader should have required knowledge and competence. Only
such person can instruct subordinates correctly and influence them.

• (iii) Integrity: A leader should posses high level of integrity and honesty. He should be
a role model to others regarding the ethics and values.

• (iv) Initiative: A leader should have courage and initiative. He should not wait for
opportunities come to his way, rather he should grab the opportunity and use it to the
advantage of organisation.
Qualities of Good Leaders contd..
• (v) Communication skills: A leader should be a good communicator. He should have the
capacity to clearly explain his ideas and make the people to understand his ideas. He
should be not only good speaker but a good listener, teacher, counsellor and
persuader.

• (vi) Motivation skills: A leader should be an effective motivator. He should understand


the needs of people and motivate them through satisfying their needs.

• (vii) Self Confidence: A leader should have high level of self confidence. He should not
loose his confidence even in most difficult times. In fact, if the leader lacks self
confidence, he can not provide confidence to his followers.

• (viii)Decisiveness: Leader should be decisive in managing the work. Once he is


convinced about a fact, he should be firm and should not change opinions frequently.

• (ix) Social skills: A leader should be sociable and friendly with his colleagues and
followers. He should understand people and maintain good human relations with them.
Leadership Styles
• There are several bases for classifying leadership styles. The most popular
classification of leadership styles is based on the use of authority. Depending on the
use of authority, there are three basic styles of leadership: (i) Autocratic (ii)
Democratic, and (iii) Laissez-faire

• (i) Autocratic or Authoritarian leader An autocratic leader gives orders and expects his
subordinates to obey those orders. If a manager is following this style, then
communication is only one-way with the subordinate only acting according to the
command given by the manager. This leader is dogmatic i.e., does not change or wish
to be contradicted. His following is based on the assumption that reward or
punishment both can be given depending upon the result. This leadership style is
effective in getting productivity in many situations like in a factory where the
supervisor is responsible for production on time and has to ensure labour productivity.
Quick decision-making is also facilitated
Types of Autocratic Leadership

► Strict Autocrats-negative
► Benevolent Autocrats-positive
► Incompetent Autocrats
Leadership Styles contd..
• ii)Democratic or Participative leader A democratic leader will develop action plans and
makes decisions in consultation with his subordinates. He will encourage them to participate
in decision-making. This kind of leadership style is more common now-a days, since leaders
also recognise that people perform best if they have set their own objectives. They also need
to respect the other’s opinion and support subordinates to perform their duties and
accomplish organisational objectives. They exercise more control by using forces within the
group.

• iii) Laissez faire or Free-rein leader Such a leader does not believe in the use of power
unless it is absolutely essential. The followers are given a high degree of independence to
formulate their own objectives and ways to achieve them. The group members work on their
own tasks resolving issues themselves. The manager is there only to support them and supply
them the required information to complete the task assigned. At the same time, the
subordinate assumes responsibility for the work to be performed. Depending upon the
situation a leader may choose to exercise a combination of these styles when required. Even
a laissez faire leader would have certain rules to be followed.
Leadership Theories
► The great man theory- The great man theory of leadership states that excellent leaders are
born, not developed. A popular concept in the 19th century, this theory states that leadership is
an inherent quality. This type of leader often possesses the natural attributes of intelligence,
courage, confidence, intuition and charm, among others. 

► The trait theory-assume that people inherit certain qualities and traits that make them better
suited to leadership. For example, traits like extroversion, self-confidence, and courage are all
traits that could potentially be linked to great leaders.

► The behavioural theory-Behavioral theories of leadership are based upon the belief that great
leaders are made, not born. Consider it the flip-side of the Great Man theories. This leadership
theory focuses on the actions of leaders, not on mental qualities or internal states. According to
this theory, people can learn to become leaders through teaching and observation.
Leadership Theories contd.
► Situational Theory- It propose that leaders choose the best course of action based upon
situational variables. Different styles of leadership may be more appropriate for certain types of
decision-making. For example, in a situation where the leader is the most knowledgeable and
experienced member of a group, an authoritarian style might be most appropriate. In other
instances where group members are skilled experts, a democratic style would be more
effective.

► Contingency theory- According to this theory, good leaders are able to assess the needs of their
followers, take stock of the situation, and then adjust their behaviours accordingly. This style is
best in all situations.
Leadership Theories contd.
► The transactional theory or management theory- These theories are based on a system of
rewards and punishments. Managerial theories are often used in business; when employees are
successful, they are rewarded and when they fail, they are reprimanded or punished.

► The transformational theory-The transformational theory of leadership, also called the


relationship theory. This theory is as the result of a positive relationship between leaders and
team members. Transformational leaders motivate and inspire through their enthusiasm and
passion. They are a model for their teams, and they hold themselves to the same standard they
expect of others. 
Importance of Directing
• Initiates action: Direction initiates action that motivates people to convert the
resources into productive outputs. It gives substance to managerial function of
planning, Organising, Staffing and controlling. People learn to manage the resources in
the most effective way that results in their optimum utilization.

• It integrates employees efforts: many employees work in organization. The activities


of all are related. If any one of the employees in the employee chain does not perform
up to the mark then it will adversely affect the performance of remaining employees.

• It is the means of motivation and developing managers: Managers who are personally
motivated to work can also direct others to work. Managers develop their skills and
competence. Motivation, leadership and communication help in bringing people
together. This is beneficial for both the employees and organisation. Direction, thus,
prepares future managers
Importance of Directing contd.
• Behavioural satisfaction: Since direction involves human behaviour and psychology,
employees feel behaviourally satisfied and personally inspired to achieve organizational
goals.

• Increase in productivity: Personally satisfied employees contribute towards output and


efficiency of the organisation. Direction gets maximum out of subordinates by exploiting their
potential and increasing their capabilities to work.

• Facilitates control: Coordination brings actual performance in conformity with planned


performance. The controlling function is, thus, facilitated through effective direction.

• Facilitates change: Direction helps in introducing change in the organization structure and
adapting the organization structure to external environment. People are not easily receptive
to changes. Direction helps in changing attitude of people in a positive way. Managers
through effective direction makes them a part of change process.

• Facilitates growth: Organisation open to change is responsive to growth. Direction


harmonizes physical, financial and human resources, balances various parts of the
organization and creates commitment amongst people to raise their standards of
performance.
Controlling
• Controlling is seeing that actual performance is guided towards expected performance
.All other functions of management cannot be completed effectively without
performance of the control function. It implies measurement of accomplishment
against the standards and correction of deviation, if any, to ensure achievement of
organizational goals. The efficient system of control helps to predict deviation before
they actually occur.

• Controlling ensures that there is effective and efficient utilization of organisational


resources so as to achieve the organisational goals.

❑ Open loop Control System- no feedback

❑ Closed Loop Control System- feedback


Importance of Controlling
• 1) Basis of future action- Control provides the basis for future actions. It will reduce
the chances of mistakes being repeated in future by suggesting preventive steps.

• 2) Facilitates decision making- The process of control is complete only when corrective
measures have been taken. This requires taking a right decision as to what type of
follow up action is to be taken.

• 3) Facilitates discipline and order – The existence of control system has a positive
impact on the behaviour of the employees. They are cautious while performing their
duties as they know they are being observed by their superiors.

• 4) Facilitates Coordination- Control helps in Coordination of the activities of various


departments of the enterprise. It provides them unity of direction.

• 5) Facilitates motivation – A control system is most effective when it motivates people


to high performance. Since most people respond to a challenge, successfully meeting a
tough standard may provide a greater sense of accomplishment.
Controlling Process
• 1) Establishment of standards- Standards are the plans or the targets which have to be
achieved in the course of business function. It acts as a basis of evaluations of actual
performance. Standards can be set in quantitative or qualitative terms. Quantitative
or measurable standards can be inform of cost, output, time, profit etc. Qualitative or
no measurable standards can be in form of performance of a manager, attitude of
worker improving motivational level of employees. Standards should be flexible i.e.
capable of being changed according to the circumstances.

• 2) Measurement of Performance –This step involves measuring of actual performance


of various individuals, group or units. Measurement of tangible standards is easy as it
can be expressed in quantitative terms. Frequency of measurement depends on the
nature of task being controlled Qualitative.
Controlling Process contd..
• 3) Comparison of Actual and Standard Performance-Comparison of actual performance
with the planned targets is very important. Deviations can be defined as the gap
between actual performance and the standards laid down. The manager has to find
out extent of deviation and cause of deviation. The manager has to exercise control by
exception. He has to target those deviation which are critical and important for
business.

• 4) Taking remedial action-Once the causes and extent of deviation are known, the
manager has to detect those errors and take remedial measures so that these
deviations don’t occur again. Remedial or corrective actions can be re planning of
standards, classification of duties, training of workers etc.
Stages of Control
► Feedforward Control- It monitors input into a process to determine whether the
inputs are as planned.
► Con-Current Control- It is exercised during the operation of a program. It
provides basis for making adjustments while the programme is still in operation.
► Feedback Control- It is based on the measurement of the results of an action.

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