SOME Notes: Principles of

Management

SOME NOTES: PRINCIPLES OF MANAGEMENT

by Professor Wilfred E. Jamandre,College of Agriculture, CLSU, Science City of
Munoz, NuevaEcija, Philippines

Why Organization?
GOALS IN LIFE:
1. Basic Needs (food)
2. Security Needs
(insurance, job)
3. Social Needs
(membership)
4. Esteem Needs
(recognition)
5. Actualization Needs

LIMITATIONS:
1.

BIOLOGICAL - (person is too

small for the stone)

2.ECOLOGICAL (stone is too big for

the person)

Why Management?
MANAGEMENT

GOALS/OBJECTIVES

Organizationis not a guarantee to accomplish individual needs,

there has to be a deliberate effort calledmanagementto bind them
in order to achieve common goals and objectives.

Management
Definition

The process of

defining organizational goals

making decisions about the efficient and
effective use of organizationalresources

to ensure high organizational performance

Basic Management Skills

Goal Setting
Setting personal and
organization goals
Motivation
Reward system
Managing conflict and
change
Managing stress
Leadership

Decision
Making

Defining problems
Choosing among

alternatives
Delegating decisions
Decision making in
uncertain situations
Creative decision
making
Leadership

Interpersonal
Relations
Communication
Understanding individuals
and groups
Leadership
Politics and authority
Management values
Management ethics

Management Functions
Planning

deciding on afuture
course
- Strategic
- Tactical

Organizing

arranging the resources of

Directing

getting people to focus their

attention on achieving the
organizations objectives
- Communicating
- Motivating
- Helping subordinates
- Overcoming conflict

organization, department or
job
- Specialization
- Coordination

Staffing

appropriate human resources

- Selection
- Appraisal
- Training
- Development

Controlling

action to correct deviations from the

standards
- establishing performance
standards
- measuring performance and
comparing it to standards
- correcting deviations

Short-term and long-term organization

performance

Efficiency

Satisfaction

Adaptability and
effectiveness

Organization Levels

Strategic
Management

External
Environment

Strategy

Tactical
Management

Design

Coordination

Operations

Decision Variables
A Problem in an Organization

Decision Issues for

Individuals
Individual decision skills
The decision process
Classifying decisions
Decision Styles
Creating and choosing
alternatives
Risk taking

Decision Issues for Organizations

Creating the right environment
Ensuring that decisions are madeon
time
Involvement of all management levels
Dealing with uncertainty
Using participation and/or delegation
Managing group decision processes
Managing creativity and innovation
Implementing decisions

Decision-making Process: Case Study Approach

Whats happening?

Description

Whats wrong?

Diagnostics

Whats ought to be?

Prescription

What if?

Prediction

Organizational Performance

The
Environment

Information

Strategic Managers
Look for opportunities
and threats in the
environment
Set long-term goals
Allocate resources to
these goals
Implement strategies
through the organizations
structure
Apply skills and functions
at top managementlevels

Information

Tactical Managers
- Coordinate efforts
among groups
- Make operating
decisions about how
work will be done
- Apply skills and
functions at middle
and lower
management levels

Organizational Performance
Efficiency

~ Profitability
~ Market positions or marketshare
~ Productivity

SHORT TERM

Tactical
Managers

Satisfaction

~ Personal development
~ Employee attitudes and values

Strategic
Managers
LONG-TERM

Adaptability and
Effectiveness

~ Public responsibility
~ Product leadership
~ Balanced short-range and longrange objectives

Organization designs
The Process

Designing organizations is a process

of:

specializing jobs in the organization so

thatwork can be accomplished efficiently
ensuring jobs are coordinated in a way
that it achieves the organizations tactical
and strategic goals

Indicators of design problems

Conflict

over basic goals

between departments and groups
Some specific indicators
employees complaints
decrease in work quality
blaming problems on others.

manager overload

the manager gets involved in many

decisions that should be made at the lower
levels
neglect of critical goals

Indicators of design problems

decline in technical expertise

unclear assignments
what goals to push for
where to find information
what work to concentrate on
people working hard but on the wrong
things

Criteria for Effective Organization

Design

Clarity and understanding

Economy

clarify positions and departments across the

vertical and horizontal levels of the
organization
enable one to understand how ones job fits
into the total organization picture
minimize efforts to reduce actual and potential
frictions as well as maintain control

Direction of vision

toward the end product of performance rather

than the means to achieve performance

Criteria for Effective Organization

Design

Aid to decision making

Stability and adaptability

delegate decision-making to the lowest

possible levels thereby allowing managers to
make decisions for which they are qualified or
appropriate
in the face of adversity but resilient enough to
adapt to changes in the environment

Perpetuation and self-renewal

should develop incumbent and potential

managers from within and allows application of
new ideas

Organization Design Process

Revisit the organizational goals and strategies

Identify and classify tasks or activities (job

description)

review the strategic goals and objectives of the

organization

determine the activities needed to accomplish the

goals
classify activities according to essentials to avoid
waste of resources

Group activities with organizational resources

(job specification and compensation package)

group similar functions and activities with

corresponding human and non-human resources

Organization Design Process

Delegate a head of each group with

corresponding authority and
responsibility

a leader to exact work performance and

productivity

Bind the groups with information and

authority relationships across vertical
and horizontal levels

groups should understand the formal flows

of communication and authority in the
organization

Organizational Models
PRESIDENT

Marketing Manager

Production
Manager

Marketing Work Force

Production Work Force

power, decision-making authority and responsibility rest with one person or with a top
managementgroup
Critical tasks one or two functions, for example production and marketing
People a few individuals who are specialists in criticaflunctions
Top managers are well-rounded in allareas
Structure a simple structure with power at the top of the organization. Top management is
responsible with coordination and supervision.

Simple Centralized Organization

Bureaucratic Organization

Bureaucratic Organization
Characteristics

Work is fragmented
Relies on specialization
Standard bureaucracies rely on external control
Professionalbureaucracies use internal or peer control
Critical tasks

Standard bureaucracy - work is standardized and often

routinary

Professionalbureaucracy has efficient performance for

complex work since skills are specialized.
People many individuals with very specialized skills
Structure many levels in the hierarchy
Important or major decisions are made at the top management
while routinary decisions are done at lower levels. Also, it has
large number of technical staff and many middle-level
managers.

Divisionalized Organization
Chairman

Senior
Execuive VP,
Corporate
Resources

President,Energy
and Advanced
Technology
Group

President,
Industries and
International
Group

VP Human
Resources

Exec VP
Defense

Exec VP
International

VP
Purchasing

Exec VP Power
Generation

Exec VP
Marketing and
Services

VP Corporate
Productivity
and Quality

Exec VP
Nuclear Energy
Systems

President,
Commercial
Group

Exec VP
Commercial
Group

President
Westinghouse
Communities,
etc

Chairman and
CEO,
Broadcasting and
Cable Group

Divisionalized Organization
Characteristics

A multi-product and service design that fragments

different products and services to facilitate top
management planning and control.
Critical tasks coordination and control of diverse
products and markets. Matching products with market
requirements could be harnessed
People middle managers are responsible for operations
and control.
Structure large organization with a relatively flat
hierarchy. It has a wide span of control for top
management that is fragmented throughproducts and
markets

Matrix Organization
Chief Executive
Officer

VP Projects

VP Marketing

VP Production

VP Engineering

VP Distribution

Project
Manager A

Marketing
Manager ProjectA

Production
Manager ProjectA

Engineering
Manager ProjectA

Distribution
Manager ProjectA

Project
Manager B

Marketing
Manager Project B

Production
Manager Project B

Engineering
Manager Project B

Distribution
Manager Project B

Project
Manager N

Marketing
Manager Project N

Production
anager Project N

Engineering
Manager Project N

Distribution
Manager Project N

Matrix Organization
Characteristics

A design that combines one design alternative with another like

functional and project.

Critical tasks performance on a large number of complex

projects that vary in their duration, have varying planning
horizons and require variable input from high-technology
specialities

People experts in specialized technical areas. Managers

especially have high levels of decision making and interpersonal
skills and are responsible for coordination.

Structure a combination of functional and project (divisional)

structures. Relationships between people are emphasized.
Control is through budgets.

Team/task force/ project Organization

Division
Manager

Research and
Development

Process
Engineering

Production

Marketing

Distribution

New Product
Team Manager

R&D Team Member

Process Engineering
Team Member

Marketing Team
Distribution
MemberTeam
Member

Team/task force/ project Organization

Characteristics

A design that coordinates specialized inputs from various

sources. This is useful for temporary work.

Critical tasks efficiently perform complex specific, temporary

jobs that require simultaneous input from various sources.

People experts in specialized areas. Team members must

have strong interpersonal and decision making skills.

Structure interfunctional, interdepartmental. The task force or

team operates outside the normal communication channels. A
task team leader is appointed.

Adhocracy Organization
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Adhocracy Organization
Characteristics

A design emphasizing managerial style appropriate for complex,

non standard work that relies on informal structure. This is the
newest design alternative.

Critical tasks highly technical work requires creativity,

innovation and cooperation

People high technology experts. Those in operations perform

complex work. Communication skills are important.

Structure organic, ambiguous, informal, only partially defined.

The hierarchy is not well defined. Many managersl,ossely
organized. Small in size.

Principles for Management

Unity of
command
principle

(1) Unity of command principle every person in the

organization should report to only one supervisor.

supervisor

Employee 1

Employee 2

Supervisor 1

Employee 3

Supervisor 2

Employees

Principles for sound organizing

The scalar
principle

(2) The scalar principle decision making and/or

authority should flow in a straight line from the top to the
bottom of the organization. Informational or informal
relationships are depicted by brokenlines.

Principles for sound organizing

The
responsibility
principle

(3) The responsibility principle supervisors are

responsible for the performance under their control
and subordinates are accountable to perform for their
superiors.

Principles for sound organizing

Unity of
direction
principle

(4) Unity of direction principle activities and resources

should be focused toward a common direction

Principles for sound organizing

Span of control

(6) Span of control the number of

specialized activities (or people) assigned to a
supervisor depends on the:
-

similarity of functionsperformed
geographic continuity of the functions supervised
complexity of functionssupervised
direction and control needed by subordinates
planning required by the supervisor
coordination required by the supervisor

organizational assistance received by the supervisor

Organization chart
Definition and
Characteristics

detailed diagram of the formal roles, authority

and information relationships in an
organization should show thefollowing:
- division of work
- chain of command
-

areas of responsibility and each persons

function in the organization
basis of organization the overall design of
the organization

Organization chart
Tips in Drawing
Organization
Chart

Boxes or rectangles in horizontal levels must be equal or uniform in

size
Boxes are connected by straight line at the middle of the box
Lines do not cross the boxes
Lines do not have arrowheads
Flow of authority is reflected by a straight line
Staff functions are represented by straight solid line immediately
under and beside the line officer
Maintain symmetry as much as possible