What Is Management?

Management is a set of activities (including planning and decision making, organizing, leading,
and controlling) that direct at an organization’s resources (human, financial, physical, and
information) with the aim of achieving organizational goals in an efficient and effective manner.

Efficiency: By efficient, we mean using resources wisely and in a cost effective way. For
example, a firm like Toyota Motor Corporation, which produces high quality products at
relatively low costs, is efficient.
Effectiveness: By effective, we mean making the right decisions and successfully implementing
them. For example, Toyota also makes cars with the styling and quality to inspire consumer
interest and confidence.

The Management Process / Functions

The manager’s primary responsibility is to carry out the management process. The following
Figure will illustrate the basic definitions and interrelationships of the basic managerial
functions:

Planning and decision-making:

• Planning is deciding in advance what is to be done. It is the future course of action. While
making plan it is to consider that a particular task, who will do, where it will be done,
how it will be done, what materials, human, physical, information and other resources
will be required and from where it will be found. Planning is the first and foremost task
of management. It includes establishing goals and standards, developing rules and
procedures, developing plans and forecasting.
• On the other hand, Decision-making is the act of choosing one alternative from among a
set of alternatives. It is the process of recognizing and defining the nature of a decision
situation, identifying alternatives, evaluating alternatives, choosing the "best" alternative,
putting it to practice and follow up.
Organizing: It is the second task of management. Organizing means determining how activities
and resources are to be grouped. The basic elements of organizing include job design,
departmentalization, authority relationships, span of control, and line and staff roles.
Leading: Leading means the set of processes used to get members of the organization to work
together to further the interests of the organization. Leading involves a number of different
activities and processes such as, motivating employees, leader's efforts to influence others,
managing interpersonal relations and communication, and managing work groups and teams.
Controlling: Controlling means monitoring organizational progress toward goal attainment. It is
the last task of management. It includes a series of activities such as determining standard,
measurement of actual performance, identifying deviation if any, and taking corrective actions if
any deviation is found.

Kinds of Managers
Top Managers: Top level managers make up the small group of executives who manage the
overall organization, the strategic level. The titles found in this kind include president, vice
president, chief executive officer etc. Their functions and responsibilities are diverse and varied
including making strategy, policies & plans and so on. They determine the fate of the
organization. They represent the organization with other organizations, government
representatives, and foreign countries and so on.

Middle Managers: Middle manager is probably the largest group that implements the strategies
developed at the top and coordinates and supervise the activities of the first line managers. The
titles include operations managers, divisional head, regional managers etc.
First-Line Managers: Supervise and coordinate the activities of operating employees.
Figure: Kinds of Managers by Level and Area
Managing in Different Areas of the Organization
• Marketing Managers
• Financial Managers
• Operations Managers
• Human Resource Managers
• Administrative Managers
• Specialized Management

The most fundamental management skills are:

1. Technical Skills: Necessary to accomplish or understand the specific kind of work being
done. These skills are especially important for first line managers.

2. Interpersonal Skills: The ability to communicate with, understand, and motivate both
individuals and groups. Be able to get along with: Subordinates, Peers, and Those at higher
levels.
3. Conceptual Skills: A manager’s ability to think in the abstract. The mental capacity to:
- Understand organizational goals and its environment.
- How the organization is structured.
- Viewing the organization as system.
4. Diagnostic Skills: Skills that enable a manager to visualize the most appropriate response to a
situation.
5. Communication Skills: A manager’s abilities both to effectively convey ideas and
information to others and to effectively receive ideas and information from others.

6. Decision-making Skills: A manager’s ability to correctly recognize and define problems and
opportunities and to then select an appropriate course of action to solve problems and capitalize
on opportunities.
7. Time-management Skills: The manager’s ability to prioritize work, to work efficiently, and
to delegate appropriately.

Principles of Administrative Management

Henri Fayol, father of administrative/modern management, has distinguished fourteen principles
of management which are now widely accepted and form the core of most management teaching,
education and practice. These are outlined below.
1. Division of labor: It is the principle of job specialization, where each job is broken down into
small parts and then assigns the responsibility to the competent person. It will enhance the
employee's expertise about the particular job.
2. Authority and accountability: It clearly defines the rights and responsibility of manager. It
defines the area of action, initiative and responsibility of each manager.
3. Discipline: Members in an organization need to respect the rules and agreements that govern
the organization. To Fayol, discipline will result from good leadership at all level of
organization, fair agreements, and judiciously enforced penalties for infractions.
4. Unity of command: It is the safeguard against dualism of control. Each employee must
receive his or her instructions about a particular operation from only one person. Fayol believed
that if an employee was responsible to more than one superior, conflict in instruction and
confusion of authority would result.
5. Unity of direction: Those operations within an organization that have the same objectives
should be directed by only one manager. For example, the personnel department in a company
should not have two directors each with a different hiring policy.
6. Superiority of general interest over individual interests: In any undertakings the interests
of employees should not take precedence over the interests of the organization.
7. Remuneration: Adequate remuneration secures a committed work force and sustains
employee's interest and participation. Compensation for work done should be fair to both
employees and employer.
8. Centralization: Decreasing the role of subordinates in decision making is centralization;
increasing their role is decentralization. Fayol believed that manager should retain final
responsibility but they also need to give their subordinates enough authority to do their jobs
properly.
9. Scalar chain: Scalar chain is the principle of the observance of the chain of command, which
discourages level jumping unless and until serious situation occurs.
10. Order: Materials and people should be in the right place at the right time. In particular
people should be in the jobs best suited for them.
11. Equity: Equity is the law of the social world, which alone secures loyalty of employees and
their cooperation. Manager should be both friendly and fair to their subordinates.
12. Stability and security: It is a basic motivation for attention to work, interest and sustained
efforts of the employees. To Fayol a high employee turnover rate is not good for efficient
functioning of an organization.
13. Initiative: Subordinates should be given freedom to imagine and carry out their plans even
some mistakes result.
14. Esprit de corps: It means cooperation and fellow feeling. It means everybody helps
everybody else in a close spirit of teamwork.

Principles of scientific Management

On the basis of his experiments, Taylor developed a set of scientific management principles
which are as follows:
1. Develop a science for each element of a worker’s job that replaces rule of thumb. Use
scientific method rather than intuition and experience to determine the work methods and tools.
Ensure that each motion or movement of workers is the most efficient possible. Lay down
standard time, standard methods, tools and working conditions for each task.
2. Functional specialization should be a part of every job. Every worker should be a specialist in
what he did and should know his job well.
3. Scientific selection, training and development of workers. Tests should be used to identify the
right person for each job. A worker should be given job for which he is most suitable.
4. Planning and scheduling of the work to ensure availability of materials and other resources at
the right place, right time, and in proper condition.
5. Standards with respect to methods and time for each task should be established. Workers
movements and the time needed to complete every movement should be scientifically studied.
Jobs should be redesigned incorporating highly efficient motions with specific time required for
each step in a task.
6. Wage incentives should be an integral part of each job. Workers should be paid a bonus if they
complete the task before the standard time. Different wage rates should be paid for different jobs.
7. Close co-operation between management and workers to accomplish work in accordance with
scientific method. Management can secure higher profits only when workers perform their jobs
with maximum efficiency. Similarly, workers can expect higher wages only when management
adopts an enlightened attitude toward them. Instead of fighting on sharing the gains of
productivity, the two sides should work together to maximize productivity so that each can get a
larger share. Both stand to gain by maximizing output. There should be a mental change in both
parties from conflict to cooperation.
8. A more equal division of responsibility between management and workers. Planning should be
separated from doing. Planning will be the responsibility of management and doing will be the
responsibility of workers.