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UNIT-1

NATURE OF MANAGEMENT
Unit Objectives:
After completion, students are expected to know the following:

Concept and Meaning of Management


Characteristics of Management
Functions of Management
Management as Science, Art and Profession
Levels of Management
Management and Administration

CONCEPT AND MEANING OF MANAGEMENT


The word management simply can be divided as manage-men-t. It simply can be explain as managing
men tactfully to gets the job done. This is the age of management. Every organization has their goals.
Organization needs management to achieve their goals. Organization goals can be achieved through proper
utilization of resources such as human, physical, financial and information resources.
Management perform various function such as planning, organizing, staffing, co-ordinating, controlling etc.
Functions are performed to get job done through people. Management performs its function in changing
environment. Management should adopt the environment changes to achieve the goals actively and
efficiently.
Management is used to mean the group of persons who manage the organization. It is needed every time
and in every activity. It is not only confined to business organizations but also in organizations such as
government, religious, charitable bodies etc.
Traditional Definition:According to the traditional view, Management is getting things done through other. This is incomplete
as it treats the employees as mere means to achieve the goals of the organizations. Needs and demands of
the employees of the organization are over looked.
Modern Definition:According to the modern view, Management is creating internal environment of an organization where
employees working together in groups can performs efficient towards the achievement of the goals. On
this basis management is goal oriented and involves creating an internal atmosphere. So that groups goals
can be achieved.
Definition of Management is given by various experts. Some of the common definitions are as follow:According to F.W. Taylor, Management is the art of knowing what you want to do in the best and
cheapest way.
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According to Mary Parker Follet, Management is the art of getting things done through people.
According to Henry Fayol, To manage is to forecast and plan, to organize, to command, to co-ordinate
and to control.
In conclusion, management is the process of planning, organizing, directing and controlling. It is an art of
getting things done through and with others. It co-ordinates of all the activities of organization. It works
through and with people. It balances efficiency and effectiveness. So it needs in all types of organization.
CONCEPT OF MANAGEMENT
Concept is an arrangement of a set of ideas. Theo Haimann has used the word management in three
different senses/concepts:
(i)
As a process
(ii)
As a noun (group)
(iii)
As a discipline
Management as a Process:
Management as a process refers to the activities or functions performed by the managers in the
organization. Management performs various functions like planning, organizing, staffing, directing,
coordinating and controlling. They are essential to efficiently use the available material and human
resources to achieve the desired objectives.
Management as a Noun:
This concept is also known as group concept. Noun concept of management refers the management as a
group of all managerial personnel of an organization. Group of managerial personnel means Chief
Executive Officer (CEO), Managing Director, General Manager, Departmental Manager, Supervisor and so
on. They take a charge of organization. They get the job done through others. This concept emphasis the
human aspect of management. It is concerned wit managing group activities.
Management as a Discipline:
This concept regards management as a discipline. It is a body of organized specialized. It involves study of
management principles and practices. Management draws knowledge from economics, psychology,
mathematics, sociology, political science and other various subjects. It is the inter-disciplinary. This concept
gives important to management, principles and practices.
CHARACTERISTICS OF MANAGEMENT
1. Goal Oriented: Management is goal oriented. Goals are end results to be achieved. It is the means to
achieve organizational goals. Goals of an organization may be to earn profit, to lead the market, to
provide services etc. all the management functions are directed towards achieving organizational goals.
The goals may economic or social. The goals are determined through the planning process.
2. Group Activity: An individual cannot satisfy all his needs alone. He works with others in an organised
group to achieve what he cannot if he works alone. When people work in an organized group, they
achieve common and individuals goals. It is a corporative group is working for all and all working for
each.

3. Factors of Production: Management is not an end but means to achieve groups objectives. Just as
other resources are required, management is equally important as a factor of production.
OR,
Management is not an end by itself but a means to achieve the group objectives. Land, labour and
capital are the factors of production and management as factor of production is required to co-ordinate
these other factors.
4. Universal in character: Management is an universal activity. The principles of management are
applicable all over the world. It is essential for all types of organizations like business, government,
military, educational and cultural. It is needed in all kind of activities.
5. Distinct Process: Management is the distinct process performs to accomplish organizational goal.
Process consists of planning, organizing, staffing, directing and controlling. Management uses the
resources to achieve goals.
6. Social Process: Management comes under humanist concept and deals with people. Due to this, it is
featured as the social process. As it is a social organization, it has a social accountability to provide
social benefits through making optimum use of scarce resources.
7. System of Authority: Management is not based upon one man, so rather it is a group activity. It relates
with collective efforts and responsibility. The people must be given authority to perform their tasks.
Authority is the power to get the work done from others by regulating their activities. Management is a
rule making and rule enforcing body in a systematic manner.
8. Dynamic Function: Management is a dynamic function and it has to be performs regularly and
continuously. Management depends upon environmental. Environment is recognized as dynamic ever
changing. Thus, it operates in and ever changing environment. Management adopts itself to
environment changes. However, it introduces in a innovation in methodology.
9. Science and Art: Management is a science because it has developed certain principles, which are of
universal application. Such principles have been developed through experimentation. But the results of
management depend upon the skill of manager and in this sense management is an art. The art of
manager is essential to make the best use of management science. Thus, management is both science
and art.
10. Profession: Management is now regarded as a profession. It has a systematic and specialized body of
knowledge, principles and techniques, which can be taught as well as applied in practice with the
increase in joint stock companies and multi-national companies. The management is entrusted in the
hands of professional mangers.
11. Intangible: Management is intangible and invisible. It cant be touched and see. It can be felt in result.
Result can be measured in terms of goal achievement.
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12. Multi-Disciplinary: Management is multi-disciplinary. It draws knowledge and concept from the other
disciplines such as economics, psychology, sociology, statistics, science, mathematics, etc. management
integrates the ideas and concepts taken from other disciplines and uses them in management
organization.
13. Separate Identified: Management is the method and the art of getting things done through others,
however it enjoys separate identify. No doubt, the identity of the staffs is guided by the identity of the
management. The identity of the management but the identities of management of staffs are not interrelated. These two are separately identified.
FUNCTIONS OF MANAGEMENT
Functions of management refer to the basic managerial activities performed by the managers at all levels of
the organizations and in all types of organizations. Different authors have offered different sets of activities.
However, there is a general consensus on: Planning, Organizing, Staffing, Directing, Coordinating and
controlling as the core functions of Management:
1. Planning: It is the process of preparing a road-map for organizations future activities based on an
assessment of future changes in the business environment. It determines requirement of different
resources and their effective utilization for achieving defined goals.
2. Organizing: It is the process of creating the structure of positions and their relationships so that works
can be allocated among employees for achieving goals of the enterprise.
3. Staffing: It is the process of selecting, training the right individuals for different jobs and motivating
them to perform assigned activities for achieving organizational goals.
4. Directing: It is activating individuals for performing activities. Leadership, communication,
supervision and motivation are the key elements of directing.
5. Coordinating: This is establishing supportive relationships among different individuals and group
activities to work together towards the achievement of the set goals.
6. Controlling: It is the process of measuring current performance against planned standards and taking
corrective measures to ensure achievement of predetermined goals.
MANAGEMENT AS SCIENCE, ART AND PROFESSION
Management as Science:
Science is systematically organized body of knowledge or a field of study. It has following important
features:
Scientific knowledge is derived through observation, experimentation and research.
Scientific knowledge is expressed in the form of theories, principles and laws.
They explain phenomena, a problem, a thing or an incidence.
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Explanations give knowledge about variables and how they are related to one another.
It cause and effect relationships and tell what variables cause what result and how.
Science helps to understand an action and predict its possible results.
Knowledge of science helps one to understand problem better, take right decision, perform efficient
activities and solve them.

Management is a science because is a body of knowledge which is systematized through the application of
scientific method. It is a scientific field of study consisting of systematic knowledge with many principles
and theories viz. principles of organization and management, theories of leadership, motivation etc. Those
principles and theories explain phenomena or problems of organizations or group activities. They help
managers to understand organizational problems and guide to take right decisions to ensure effective
achievement of its goals. Thus management is science.
Management as an Art:
Art is practice. It is doings things efficiently and effectively in the light of the situation to achieve goals. It
has following important features:
Art is about applying knowledge, talent, and intelligence in taking right decisions.
It is intelligent application of knowledge and skills in performing activities.
Efficient performances of activities are essential to achieve goals effectively.
Efficiency and effectiveness of performance requires sound knowledge about a problem (science)
and skill to intelligently apply that knowledge according to the need of the situation (art).
Situational differences require the application of scientific knowledge differently in different
degrees.

Science and art both are complementary to one another. Science gives organized knowledge about a
problem and art results in efficient application of those knowledge in performing activities for effectively
achieving goals. Management principles and theories, as science, provide knowledge about how
organizational problems emerge and how they can be solved. Managers use such knowledge in the light of
the situational reality and take right decisions to solve them.
Management as a Profession:
A profession is an economic activity performed on the basis of specialized knowledge to provide services
to the clients and charge fees from them. It has following important features:

It provides services of a specialized nature.


It requires completion of academic and practical training.
Knowledge and skills are used to provide services to the clients.
Professionals charge fees from the clients for their services.
It requires certificate of public practice from the professional organization or associations viz.
Medical Association, Management Association, Medical Council etc.

Management is a profession, because managers need to obtain professional degree viz. BBA, MBA etc.
They need to obtain membership from Management Association to provide independent services to the
organizations. They charge consultation and counselling fees from their clients.
From the above description it is obvious that management is a science, an art and a profession as well.
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LEVELS OF MANAGEMENT
In organizations management performs different tasks at different levels. The different tasks are related to:
money management (finance), people management (human resource) etc. They are organized in different
levels, which are generally classified as: top level, middle level, and bottom level.
OR,
Level means position in the organization. Levels of management mean dividing the authority and
responsibility among the various managerial positions. The level of management defines the superior
subordinates relationship from the top level to the lower level in the organization. There are various types
of people in the organization to perform the jobs. They have different types of jobs and position. According
to job, nature and position of the people in the organization, the management is classified into 3 levels.
They are:-

Top
Level
Management

Middle
Level
Management

Lower
Level
Management

Figure: Levels of Management

1. Top Level Management:


The top level management stands as a head of the organization. Top level management is also known as
the brain of the management. It is responsible for the overall management of the organizations. It sets
the goals, plans, policies and strategies of the organizations. It takes all the major decisions of the
organizations. It is the ultimate source of authority. It requires more conceptual skills. It consists of
Chairman, Board of Directors, Managing Directors, Chief Executive Officer (CEO), and General
Manager.
The top level management has the following functions:a. Making plans and policies = top level management makes long term and short term plans and
policies.
b. Goal Setting = Top level management set the goals and objectives of the organization.
c. Organizing = It formulates the organizational structure. It creates various departments and units.
d. Hiring = it hires middle level and lower level manager.
e. Resource Allocating = It allocate resources to various departments and units and mobilizes them.
f. Direction and Control = It provides overall direction and control in the organization.
OR,
a. To formulate and determine the objectives and define the goals of the business.
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b.
c.
d.
e.
f.
g.

To establish policies and prepare plans to attain the goals.


To set up an organizational structure to conduct the operations as per the plans.
To provide the overall direction in the organization.
To assemble the resources necessary for the attainment of the policy and execution of the plan.
To control effectively the business operations.
To judge and evaluate the results.

2. Middle Level Management:


Middle level management is lower than top level management and higher than lower level
management. It implements the plans, policies, strategies, formulated by the top level management to
achieve organizational goals. It is the link between top level and low level management. In other words,
we can say that it acts as a bridge between top level management and lower level management .It is
responsible to top level management. It supervises, guides and controls the low level management. It
consists of the managers of the department, divisions and branches and section.
Function of Middle Level Management:Middle level management has the following functions:a. Implementation = It implements the plans, policies and strategies formulated by top level
management.
b. Departmental plans = It prepares departmental plans, action and implement it.
c. Reporting = It report the top level management about the functions of departments and units.
d. Hiring = It hires the lower level managers and workers.
e. Supervision = It instructs the lower level management and supervises them.
f. Motivation = It motivates the low level management for higher level performance.
g. Mediator = It works as a mediator between top and lower level management. It communicates
grievances of employees to top level management.
OR,
a. To implement the task set up by top management.
b. To implement the policies framed by the top management.
c. To run the organizations effectively and efficiently.
d. To cooperate for the smooth functioning of the organizations.
e. To coordinate between different departments.
f. To recruit, select and train the employees for the better functioning of the departments.
g. To issue the instructions to the lower level management.
h. To motivate the workers and staffs for higher productivity and to reward them.
i. To lead the departments and build up an organizational spirit.
j. To report and make suitable recommendations to the top level management for the better execution
of the plans and policies.
3. Lower Level Management:
It is also known as bottom level management, supervisory level of management or first-line managers.
It performs doing function rather than thinking or managing. It directly supervises the activities of
workers. It assign specific job to the workers, instruct them, evaluate their performance and reports to
the middle-level management. It consists of supervisors, foremen, section heads, co-ordinator, office
manger, quality inspector etc.
Function of Lower Level Management:7

Lower level management has the following functions:a. Implementation = It implements action plans prepared by managements.
b. Supervision = It supervises, guides and control the operated employees.
c. Reporting = It reports the performance problems and grievances of operated employees to middle
level management.
d. Arranged Tools = It arranges the necessary tools and equipments to the workers.
e. Motivation = It motivates the worker for their higher performances.
f. Co-ordination = It maintains employee relation, co-ordinates them, provides training and maintain
discipline in the work place.
OR,
a. To issue the orders and instruction to the workers to supervise and control the performance.
b. To plan the activities of the sections.
c. To direct and guide the workers about the work procedures.
d. To provide job training to the workers.
e. To arrange the necessary tools, equipment, materials for the workers and look after their proper
maintenance.
f. To solve the problem of workers.
g. To develop sense of cooperation and high group spirit among the workers.
h. To advise the middle level about the work environment.
i. To inform the unsolved problems of the workers to the middle level management.
MANAGEMENT AND ADMINISTRATION
The term Administration is thinking and formulating function performed by authorities at the top level of
the organization structure. Its function is confined to a small group to make broad and long term policies of
the organisation. According to Oliver Sheldon, Administration is concerned with determination of
corporate policy, the coordination of function, production and distribution, the settlement of compass of the
organisation and the ultimate control of executives
Management refers to the executive function of the organization. The middle and lower level managers are
responsible to execute organizations policies and strategies prepared at the top level of the organization.
Managers execute them through planning, implementing the plans and controlling the performance of
activities for achieving desired goals.
At the top level of organizational hierarchy, administrative function dominates over managerial functions.
At the medium level, administrative and management are given equal importance whereas, at the bottom
level management is more significant than administration. The fact can be diagrammatically expressed as
under:
Administratio
n

Top
Management

Middle
Management
Management

Lower
Management

Figure: Administration and Management

Differences between Management and Administration:


S.No.
1

On the Basis
of Differences
Nature of
Work

Scope

Level of
Authority
Main
Objectives
Decision
Making
Nature of
Organization

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5
6
7

Ability

Main
Functions

Administration
It is thinking function.
formulates policies.

Management
It It is doing function. It implements
the policies.

It provides guidelines for decision It makes the decisions within the


making.
policy guidelines.
It is the top level authority.
It is the middle and low level
authority.
It provides service.
It helps to earn profit.
It is influenced by public opinion
and environment.
It is usually used in relation to
government, military, educational
and relational organizational.
It requires administrative ability
rather than technical ability.
Planning and organizing are the
main function.

It is influenced by values and beliefs


of manager.
It is used mainly in firms and
business houses, which have
economic motive.
It requires more technical ability than
administrative ability.
Directing, controlling and motivating
are the main functions.