.

UNIT-1

Introduction:

Management is universal in the modern industrial world, and there is no substitute for
good management. It makes human efforts more productive and brings technology.

Meaning of Management: Management is relatively a new discipline. Being a new

discipline it has drawn concepts and principles from economics, sociology, statistics and
so on. The result is that each group has defined Management differently.

E.g.: Economists see Management as a factor of production; sociologists see it as a class

or group of persons.

Management is a Process: Management is called a process which involves Planning,

Organizing, Directing and controlling the efforts of human resources in the use of
material resources.

The definition of management is graphically as shown below:

Henri Fayol the father of Management process school. He has defined Management as
a process consisting of five functions “to manage is to forecast and Plan to Organize, to
Command, to Co-ordinate and to Control”.

Definitions:
 .

1. According to R.C Davis management is the function of executive Leadership

anywhere.

2. According to George R. Terry says, management is a distinct process of Planning,

Organizing, Actuating, and Controlling performed to determine and accomplish
the objectives by the use of people and resources.

3. According to Harold Knootz, Management is the art of getting things done

through and with people in formally organized groups. It is the art of creating the
environment in which people can perform as individuals yet cooperate towards
attainment of group goals.

4. According to Joseph Massie Management is defined as the process by which a

cooperative group directs action towards common Goals.

5. According to Lawrence A.AppleyManagement are the development of people and

not the direction of things…Management is personnel administration.

6. According to PeterF.Drucker Management is concerned with the systematic

organization of economic resources and its task

Nature of Management: The following are the important features or Characteristics of

Management:

 Management is getting things done: A Manager does not do any operating work
himselfbut gets it done through others. He must motivate the subordinates for the
accomplishment of the task assigned to them.

 Management is an activity: Management is a process of organized activity. It is

concerned with the efficient use of resources like men, Money, and Material in the
organization.

 Management is a group activity: Management cannot exist independent of the group

or organization it manages. It is a cardinal part of any group activity and inspires
workers to put forth their best efforts.
 Management is Purposeful: Management is a goal-oriented activity. It is concerned
with the accomplishment of goals through its various functions like Planning,
Organizing, Staffing, Directing and Controlling.

 Management is a Profession: It is a profession because some of its established

principles are being applied in practice.
 .

 Management is Intangible: Management is abstract and cannot be seen with the eyes. It
is evidenced by the quality of the organization and the results. Thus, feeling of
management is result oriented.

 Management is a Science and an Art: Management has developed certain principles

and laws which have wide applications. So it is treated as a Science, it is also an Art,
because it is concerned with the applications of knowledge for the solution of
organization problems.

 Management involves decision-Making: Management process involves decision-

Makingat various levels for getting things done by other. It involves selecting the most
appropriate alternatives out of the several.

 Management is Dynamic: Management is Dynamic because it adapts itself to the social

changes introduces innovation in methodology.

 Management is concerned with directing and controlling: Management is concerned

with the direction and control of the various activities. It deals particularly with the
active direction of the human efforts.

Importance of Management:

Management plays a unique role in modern society. It regulates our productive activities
by organizing factors of production. A business which has all the resources like men,
money, material and Machinery cannot satisfy customers unless they are efficiently
managed. The following are the various points of the significance:

 Determination of objectives: The success of various operations of an

organization mainly depends on the identification of its objectives. Objectives are
identified and laid down by the management. They should be in writing and
communicated to all others in the organization
 Achieving of objectives: It is the Management which directs the group efforts
towards the achievements of various objectives. It brings the human and non-
human resources together
 Optimum utilization of resources: It is the management which makes optimum
utilization of various resources such as Land, labour, Capital and enterprise.
 Provide innovation: Management infuses an enterprise with new ideas,
imagination.

1. Meeting Challenges: All the policy decisions of an enterprise are taken by the
management. It keeps in touch with the current environment & predicts what is
going to happen in future.
.

2. Smooth running of business:-Management helps in smooth running of business

through better planning & control.

FUNCTIONS OF MANAGEMENT
Management of a modern business organization is a complex process. The term
process refers to an identifiable flow of information through interrelated stages of
analysis directed for the accomplishment of objectives.

Thus Management as a process may involve several activities. These activities

are called the functions of Management. The main activities involved in Managerial
functions are:

1. Planning
2. Organizing
3. Staffing
4. Directing
5. Controlling

Explanations:
 Planning: It is a mental process requiring foresight and sound judgment. It
determining the course of action to achieve the objectives.
Planning implies deciding in advance “what to do, when to do, where to do and how
the results are to be evaluated. It is a continuous process. It is required to ensure
effective utilization of human and non human resources to accomplish the desired
goals. The process of Planning involves the following activities:
 Laying down objectives
 Development Planning
 Searching alternative course of action
 Evaluating of various alternatives and formulation of a Plan
 Formulating Policies and Procedures
 Preparing Schedules, programmes and Budgets.

 Organizing: Once Planning is affected, the people in the organization have to be

organized. Organizing is the process of establishing relationships among the members
of the organization.
Organization is the process of identifying and grouping the work to be
performed and dividing it among the individuals and creating authority and
responsibility relationships among them for the accomplishment of objectives. “The
process of organizing thus involves the following activities:
 Identifying the activities involved in achieving the objectives
 Grouping the activities into a Logical pattern
 Assigning the activities to employees.
.

 Delegation (Placing) authority and fixing responsibility.

 Coordinating the authority and responsibility relationships of various activities.

 Staffing: It is considered as a separate function in view of the need to employ the right
type of people and develop them for the well being of the organization. It is concerned
with the human resources of an organization.
According to Harold Knootz and O’Donell “The Managerial function of staffing
involves maintain the organization structure through proper selection, appraisal and
development of personnel to fill the roles designed in the structure”. It involves the
following:
 Man power planning i.e. determining the numbers and the kind of personnel
required.
 Recruitment of personnel.
 Selection of the most suitable personnel.
 Placement and orientation of employees
 Training and development
 Proper Evaluation of employees.
 Transfer, Promotion, termination and lay off of employees.

 Directing: Directing is otherwise called Management in action. It is concerned with

the actuating of the members of the organization for the accomplishment of goals.
In the wordsof George R. Terry “Directing means moving to action and supplying
simulative power to the group”. It involves issuing instructions to sub-ordinates,
guiding, Motivating, and supervising them.

 Controlling: It is the process of seeing whether the activities have been performed in
conformity with the plans. “ Controlling is the process of checking actual performance
Against the agreed standard with a view to ensuring satisfactory performance”.
The process of controlling involves the following:
 Determination of Standards for measuring work performance.
 Measurement of actual performance.
 Comparing actual performance with the standard.
 Finding variance between the actual and the standard, and the reasons for the same.
 Taking corrective action to ensure attainment of objectives.
.

HENRY FAYOL’S PRINCIPLES OF MANAGEMENT

Henri fayol suggested fourteen principles of management for running the business
efficiently. They are as follows

1. Division of work:It refers to the division of work among various individuals in the
organization to bring about Specialization in every activity. It tends to increase
efficiency& helps to avoid waste of time and effort caused by changes from one work
to another.
2. Authority &Responsibility: Authorityis power to give orders to the sub ordinates.
Responsibility means the duty which the sub-ordinates are expected to perform. Fayol
suggested that authority & responsibility should go hand-in-hand. Authority without
responsibility promotes irresponsible behavior on the part of management. Similarly
responsibility without authority makes management ineffective. Thus there should be
parity between authority &responsibility.
3. Discipline: it is highly essentially for the smooth running of the organization. It means
obedience to rules & regulations of the organization. Maintains of discipline in the
organization depends up on the quality of leadership, clear & fair agreements and so
on.
4. Unity of command: - an employee should receive orders from one superior only for
any action (or) activity. This principle is necessary to avoid confusion &conflict.
When there is unity of command, it is easy to fix responsibility for mistakes.
5. Unity of direction: the principle of unity of direction states that for a group of activity
having the same objectives, there should be one head and one plan. It alone can
produce a sense of loyalty & devotion among the sub-ordinates. Unity of command
pertains to the functioning of personal. Unity of direction is provided for by sound
organization of the body corporate.
6. Subordination of individual interest to general interest: this principle calls for the
reconciliation of objectives of individuals with those of the organization. Organization
is superior to individuals. When the individual & the organizational interests conflicts,
the latter must prevail (exist).
7. Remuneration to personnel: The remuneration of the employees should be fair and
just. Employees who are paid decent wages will have high morals.
8. Centralization: It refers to the concentration of authority at one level in the
organization. On the other hand decentralization is the dispersal of authority to the
lower levels in the organization. The degree of centralization may be different in
various cases. But a balance should be maintained between centralization &
decentralization to ensure the test results.
9. Scalar chain: It refers to “the chain of superiors ranging from the final authority to
the lowest level in the concern”. It is otherwise, regarded as a chain of command
because orders (or) instructions issued at higher levels flow through intermediate
managers before reaching lower levels.
.

Scalar chain states superior-subordinate relationship throughout the concern, it is

highly essential to ensure unity of command and effective communication in the
organization. But they may be certain limitations.

a) Communication takes too long a time as the order flows from the top to the bottom in
the chain.

b) There is possibility of distortion of messages in the course of its transmission.

However a ‘gang plank’ may be created by passing the established line of authority to
allow quick communication & swift action as shown in the following diagram.

Eg: - the scalar chain in an organization is represented

by two loaders i.e. “A to F” and” A to P”. Any
communication from F to P has to flow upwards to A
through E, D, C and B. then downwards through L, M,
N and O. it obviously takes a long time. So in order to
minimize the delay involved in communication a “gang
plank” between “F and P” may be created as shown by
the dotted line. However the gangplank should not be a
normal practice as it undermines the established line of
authority.

10. Order: This principle implies a “right man in right

place”. Fayol said that there should be a place for everything and everyone. The
management should get order in work through suitable arrangements of men and
materials.

11.Equity: It means justice and kindness. Management must practice equity and equality
of treatment while dealing with the people. Equity ensures healthy industrial relations
between management and labour.

12.Stability of tenure: This principle calls for the lowest possible turnover personnel for
the well-being of the organization. The loyalty of the employees highly depends on their
stability in the organization, the management should strive to minimize employee
turnover.

13.Intiative: It implies freedom to think and executive a plan. It is a powerful motivation

of human behavior and sources of strength for the organization.

14.Espirit de-corps: It means the spirit of loyalty and devotion which unites the members
of a group. This is the principle of “Union is Strength” and extension of unity of
command for establishing team work.
.

The policy of “divide and rule” should be replaced by “Union and Strength”.