Nature of Management

The Indian CEO: An Endangered Species?

In the space of a few years, the corporate environment in India has moved from a closed, planned
economy into a global wired and turbulent world economy. The rule of the game has changed suddenly.
The license-permit-raj required CEOs to know the domestic market, know the government, and make
short- term plans be able to handle diversified businesses, and also implement the vision of the Babu.
The family-owned businesses wanted fixers, yes men, collaborators and people with right connection
with government officials. Not anymore. As Harsh Mariwala, Chairman, Marico industries remarked: the
Indian CEO is facing competition not only from MNCs, but from local CEOs as well. The job of a CEO has
become complex. In the current scenario, according to Tarun Das of CII industry needs CEOs who are
technologically proficient, analytical and willing to face challenges head on. Azim Premji laments that,
not many Indian CEOs have “fire in the belly”. Ashwain Dani, MD of Asian Paints feels that the potential
CEO should have wide project implementation skill and international exposure to visualize the impact of
global trends ahead of others. Since he is public of a company, now-a-days, he needs good
communication skill to be able to communicate effectively with the employees, with the shareholders,
customers and to lead the ideally flat and friendly workplace. In the AV Birla Group of companies, led by
Kumarmangalam Birla, the emphasis is on finding latent in young people at an early stage, nurture and
reward through positive strokes and ensures that young talent stays attracted to the group. Every
attempt is to ‘make the group a fun place to work in’. The CEO, therefore, is expected to be friendly and
flexible, but firm and decisive. As summed up by an expert “the CEO is young and restless, but
unemotional. He is hand-on manager, but thinks long term. He is a techie, but people-oriented. He is
multi-skilled, experienced, a visionary”.Now CEOs are under pressure to show result quickly, especially
when the quarter –to-quarter performance of a company is X-rayed by analysts, restructure operations
continually in line with environmental changes and improve operational and cost efficiencies. The high-
tech environment, global competition and workforce diversity and lot of other issues have begun to
impact the career-spans of CEOs in India. As a result, ‘CEOs tenures are getting progressively shorter’.
Non-performance is not tolerated any longer in any industry. “if you deliver, you are not a target for the
competition. If you do not, you are asked to leave. Either way, you go”.

Sources:

I.Team CD, The man for the new millennium, Economic Times, 8-14, Jan., 1999.
II.R.A Thankur, Reaching for the sun, ET, 29 Dec., -4 Jan., 2001.
III.G.Cherian, Old before their time, ET 29 Dec., -4 Jan., 2001

Introduction
Organizations have a variety of goals. They usually direct their energies and resources to achieve these
goals. A profit-oriented nosiness form, for example, might have a return-on-investment goal; a hospital
would have goals centered on patient care; and an educational institution would establish goals for
teaching, research and social service. Organizations possess human as well as non-human resources
(plant, equipment, land, money, etc.) that are put to use in the service of specific goals. Management is
the force that unifies human as well as non-human resources in the service of organizational goals. It is a
process of getting results with and through people.

Management as a Unifying Force

Management is needed whenever people work together in an organization. The managerial functions
must be performed by anyone who manages organized efforts, whether it is a business enterprise,
religious organization, military outfit or a social institution such as planning, organizing, directing and
controlling. These functions are performed at all level in an organization, regardless of its type or size.
The services of management are essential in all cooperative endeavors.
What is management?
It is not easy to define the term management. There are many definition of’management’ as there are
books on the subject. There are certain genuine reasons for this: (1) Management is a vast subject. It is
very extensive. It is, therefore, not possible to put all the essential features of management in a single
formula. (2) Management is concerned with human beings, who are behaviorally highly unpredictable.
(3) Management is a young developing discipline whose concepts are continuously changing. It is small
wonder, writers like Allen remarked, that ‘the manager is one of the great unknown in the businesses.
Most definition of the word ‘management’, emphasis one common idea: it is concerned with the
accomplishment of objectives through the efforts of the people performing certain functions. Let’s look
into these definitions:
1. Management is the accomplishment of results through the efforts of other people (Lawrence A.
Appley).
2. Management is the art of getting thing done through and with the people in formally organized
groups. (Koontz H.)
3. Management is a process of planning, organizing, actuating and controlling to determine and
accomplish the objectives by the use of people and resources (terry. G)
4. Management is the process by which managers create, direct, maintain and operate purposive
organizations through systematic, coordinated, cooperative human effort. (Mc. Farland.)
5. It is the coordination of all resources through the process of planning, organizing, directing and
controlling in order to attain stated objectives (Sisk).

Some have defined management ass a decision-making, rule-making and rule-enforcing body.
According to prof. Moore, management means decision-making. Others (Appley) called it as ‘personnel
administration’. For the sake of simplicity and convenience, we can broadly define the term thus:
Management is concerned with resources, tasks and goals. It is the process of planning, organizing,
staffing, directing and controlling to accomplish organizational objectives through the coordinated of
human and material resources.

 MANAGEMENT AS A NOUN
In popular usage, management refers to a group of people who direct the activities of other people and
materials resources towards the attainment of predetermined goals. Viewed broadly, management may
be interpreted as a resource, a system of authority or ass a class or elite. The economist’s view of
management is that, it is a factor of production like capital, labor, etc. The managerial resource
determines the success of an organization. As a system of authority, management refers to a team of
managers who make decisions and supervise the work of others. Sociologists, finally, look at
management as a class and status system. Managers are a distinct class the society having specialized
knowledge and skills.

 MANAGEMENT AS A PROCESS
Management as a process refers to a series of inter-related functions, such as planning, organizing,
staffing, leading and controlling. Actually, managers are known by the work they do. According to James
Lundy, ‘Management is what management does’. Management process suggests that all managers
perform certain functions in order to realize certain goals.
Management, it should be noted, is a social process because it is concerned with relations
among people at work. A manager sets the objectives of an organization. He provides an environment
that is helpful to group action. He offers incentives to those who show good performance and thus helps
the organization realize its goals.

 MANAGEMENT ASA GROUP/TEAM

The term ‘management’ is used to denote the persons who manage the affairs of an organization. Board
expressions, such ass ‘management has declared a lockout’, ‘management takes tough stand against
workers’, often hit newspaper headlines. When such statements are made, reference is actually made to
the people who manage the affairs of an organization. Thus as a group of persons, management
includes all those who are responsible for making decisions and supervising the work of others.

 MANAGEMENT AS A DISCIPLINE
As a discipline management is a specialized branch of knowledge which involves the study of certain
principles and practices. Over the years, management has emerged as a separate field of study. It can be
studied, knowledge about manager it obtained and skill in its applications acquired. The old saying
‘managers are born, not made’ stands depreciated now. People believe that managerial skill could be
acquired through formal education and training. It is small wonder that many institutes have been set
up in India which a view to import management education to prospective managers.

 MANAGEMENT AS AN ACTIVITY
Management refers to a separate class of activities which are performed by managers. Managerial
activity consists of planning, organizing, staffing, directing and controlling. These activities are
performed to get the work done with and through people. Due to their biological and psychological
limitations, it is difficult for human brings to achieve their objective all alone. They have to join
organizations and work toward common goals. A point out by D.A. Wren, ‘management is an activity, it
should be remembered, cannot be measured in a precise way (unlike non-managerial operation like
typing, machine operations, where the output can be measured). A manager directs the work of others.
He contributes indirectly towards the achievement of enterprise objectives. His work defies precise
measurement. Terry, therefore, said that management is intangible. The student is advise not to confuse
this point (management is an invisible force) with the person (a team of managers who are visible) who
perform managerial activities. The evidence of good managerial work on the form of employee
satisfaction would only be seen in results which cannot be quantitatively measured.

Scope of Management
The scope of management is very wide. Basically, it refers to three distinct ideas. According to Herbison
and Myers, management may be understood as (1) and economic resource (2) a system of authority,
and (3) a class or elite.

 MANAGEMENT IS AN ECONOMIC RESOURCE

Management is one of the factors a production along with land, labour and capital. In modern
organization, the effective use of the five M’s of management (money, materials, manpower, machinery
and method or way of doing things) depends to a great extent on the quality of management. In other
words, how effectively and economically the five M’s are combined together to produce desired results.
According to Newman, management is required to convert the disorganized resources of men,
materials, money and machines in to a productive, useful, on-going concern.

 MANAGEMENT AS A SYSTEM AUTHORITY

According to Herbison and Myers, management is the rule-making and rule-enforcing body. It is
bound together by a web of relationships between superiors and subordinates, that is, people
are bound by authority relationships. Managers working at top levels enjoy more authority then
people working at lower levels. Top management determines objectives and provides direction
to enterprise activities. Middle management (departmental head like work manager, finance
manager, personnel manager etc.) interprets and explains the policies framed by the top
management. They transmit orders, instructions and decisions downward and carry the
problems and suggestions upward. Lower
management (first line supervisors) is concerned with routine, day-to-matters.

 MANAGEMENT AS A CLASS OR ELITE

Sociologists view management as a distinct class in society having its own value system .The managerial
class has become very important in modern organizations owing to its contribution to business success.
As a separate group, the term management refers to the group of individuals occupying managerial
positions. All the managers from the chief executive to the first line supervisors are collectively
addressed as 'Management', which refers to the group.

 Characteristics of Management
The various interpretations of management emphasis\ze three things: (i) management is a process and
involves a series of continuing and related activities, (ii) it tries to concentrate on reaching organizational
goals' (iii) and it reaches these goals by working with and through other people and other organizational
resources.

The important features which reveal the nature of management may be stated thus:

1. Management is intangible: As pointed out by, Terry, management is intangible. It cannot be

seen. It is an unseen force. However, its presence can be felt by the results of its efforts in the
form of production, sales and profits.

2. Management is goal-oriented: Management seeks to achieve goals. These goals may, be

economic
or non-economic. In a business organization, the primary goal is to produce and distribute
goods with a view to earn profit. In a service organization, the goal might be customer service
(hospitals, educational institutions, etc.).

3- Management is universal: Management is an all-pervasive activity. It is needed in all types of

Organizations ,e.g., university ,, club, army, government, business. The basic principles of
management are applicable in business as well as in other organisations. These principles,
however, need careful application depending on situational demands.

4- Management is a social process: According to Newman, management is a social process

because
it deals with people. To make the best use of human efforts, managers have to create close
cooperation among employees in an organisation. They have to use resources For the benefit
of
society as a whole. They have to look after the interests of employees, shareholders customers,
investors and community.

5. Management is a group activity Management is concerned wirh getting things done through
people' People join groups in order to achieve results collectively,. Management helps people in
realizing individual as well as group goals in a coordinated way.

6. Management is a system of authority: A manager is supposed to get things done, rather than
doing things himself, by using authority. Authority is the right to give orders and the power to
obtain obedience from subordinates. In this sense, management may be understood as the
rulemaking
and rule-enforcing body in an organisation. According to Drucker, "management is a
multipurpose organ that manages a business, manages managers and manages workers and
work." Managers operating at higher levels, o[ course, possess more authority than those
working at the lower levels.

7. Management is an activity :Management is a distinct activity, (like playing, reaching,

studying). It can be studied, knowledge about it obtained and skill in its applications acquired.
Further, management is not one-shot deal. In the face of continual changes in environment,
technology ,competition, new problems crop up displacing old ones. "Old order change the
yielding place to the new!" Management must, therefore, address itself to problems on a
continuous basis. The cycle of management is a never-ending process and it continues as long
as the organisation continues to operate .Management is dynamic: Management is a dynamic
and growth-oriented function. It tries to visualize problems before they turn into emergencies
and takes suitable steps. It tries to adapt itself to the environmental changes quickly'. It
proposes to take actions to make the desired results to come to pass. According to Drucker,
'rnanagersdo not wait for the future; they make the future'.

9. Management is a science as well as an art: Management is a systematized body of

knowledge based on certain principles capable of general application. The principles underlying
time and motion studies,morale, motivation, leadership-can be applied by persons working in
various capacities. Art is the application of knowledge and skills to achieve results. Management
is an art because it involves the use of know how and skills like any other art such as music
,painting, etc. In recent years, management has developed into a separate, distinct discipline
,receiving vital inputs from subjects such as psychology, sociology, anthropology, economics
,etc. Management degrees are the hottest selling products in the corporate world now. In the
days ahead, the status of management as a discipline is bound to increase. In fact,
management becomes essential, whenever and wherever people come together to achieve
some common objectives.

10. Management is multidisciplinary: Management has received rich contributions from various
disciplines like psychology, sociology, anthropology, etc. The insights obtained from these
disciplines greatly help managers in understanding the 'black-box' (human mind) much better
.More importantly, management is a creative activity. Managers utilize the scarce resources at
their: disposal in a rational way'. They make things happen in a desired manner. "They convert
the disorganized resources of men, materials and machines into a useful, productive
enterprise".

(Neumann) They create a whole that is greater than the sum of its parts. They achieve results in
an efficient and effective manner.

Who are Effective Managers ?

Based' on the research sponsored by the Centre for Creative Leadership, Robert kapalan
described

effective managers as persons who:

 Have vision, think long-term, set direction;

 Are good communicators and good listeners;
 Understand operations;
 Know where to spend time and how to priorities;
 Do not resist change;
 Delegate well Act confidently
 Accept responsibility and admit mistakes
 Are motivating, curious, honest, credible and decisive
  Importance of Management

According to Drucher, management is the dynamic life-giving element in every

organization. It is the activating force that gets things done through people. 'Without
management, an organization is merely a collection of men, machines, money and
material. In its absence, the resources of production remain resources and never
become production. The importance of management can be understood from the
following points:

1) Optimum use of resources :- Management ensures optimum utilization of resources by

attempting to avoid wastage of all kinds. It helps in putting the resources to the best advantage
within the limitations set by the organisation and its environment. A right climate is created for
workers to put in their best and show superior performance.

2) Effective leadership and motivation: In the absence of management, the working of an

enterprise will become random and haphazard in nature Employees feel a sense of security
when they find a body of individuals working day and night for the continued growth of an
organization .Management makes group effort more effective. It enables employees to move
cooperatively and achieve goals in a coordinated manner, Management creates teamwork and
motivates employees to work harder and better by providing necessary guidance, counseling
and effective leadership.

3) Establishes sound industrial relations: Management minimizes industrial disputes and

contributes to sound industrial relations in an undertaking. Industrial peace is an essential
requirement for increasing productivity. To this end, managers try to strike a happy balance
between the demands of employees and organizational requirements. They initiate prompt
actions whenever workers express dissatisfaction over organisational rules, methods,
procedures and reward systems

4) Achievement of goals: Management plays an important role in the achievement of objectives of

an organization. objectives can be achieved only when the human and non-human resourcesare
combined in a Proper way. Management is goal-oriented. with a view to realize the
predetermined goals-managers plan carefully, o.g"--rrir. the resources properly, hire competent
people and necessary guidelines they try to put every thimg on right track. Thus, unnecessary
deviations overlapping efforts and waste motion are avoided. In final analysis,all these help in
realizing goal with maximum efficiency

5) Change and growth: A business concern operates in a constantly changing environment

.Changes in technology, government policy, competition, etc., often threaten the survival of a
 firm .Failure to take note of customer needs regarding fuel efficiency has spelt doom for 'Ideal
Java in the two-wheeler market in India. An enterprise has to take note of these changes and
adapt itself quickly. Managers help an organization by anticipating these changes (careful
planning ,forecasting combined with efficient use of resources) and taking appropriate steps.
Successful managers are the ones who anticipate and adjust to changing circumstances rather
than being passively swept along or caught unprepared. Employers today are hiring managers
who can take unfamiliar situations in their stride. At AT&T, people remark, "If you are hiring
people who do not like surprises, you are probably not hiring the right people."

6) Improves standard of living: Management improves the standard of living of people by (a)
using scarce resources efficiently and turning out profits, (b) ensuring the survival of the firm
in the face of continued changes, (c) exploiting new ideas for the benefit of sociery as a whole,
and (d) developing employee talents and capabilities while at work and prompting rhem ro
show peak performance.

The great economist, Joseph. A Schurnpeter, referred to management and entrepreneurs as

the engine of growth. Drucher called management 'the life-blood' of an enterprise. According to
him ,management is 'the crucial factor in economic and social development'. Admittedly, firms
can fail because of inadequate funds, improper marketing, incompetent product design and for
many other reasons. They often fail because the basic management functions are performed
poorly or not at all. Management is "the single most critical social activity in connection with
economic progress. Physical, financial and manpower resources are, by themselves, only
passive agents: they must be effectively combined and coordinated through sound and effective
management, if a country is to experience a substantial level of economic growth and
development."

 Management vs. Administration

There has been a controversy over the meaning of the terms 'management ‘and 'administration'. Some take
management and administration as one; some consider administration broader than management and
some hold a view that management and administration are different. Let examine the opinions of various writers
before trying to resolve this controversy.

ADMINISTRATION IS BROADER THAN MANAGEMENT

Writers like Ordway Tead, Oliver Sheldon, IX/William Spiegel, William Schulze maintain rhat,
administration is broader than management. Administration determines the specific goals and lays
down the broad areas within which those goals are to be achieved.
Administration is a policy-making function. Management, on the other
hand, is concerned with carrying our the broad policies laid down by
administration. In the words of Spiegel, 'administration is largely
determinative, whereas, management is essentially executive'. Thus,
according to this American school of thought administrators think, managers act: administrator is
a top level activity and management is a lower level function

 ADMINISTRATION IS PART OF MANAGEMENT:-

According to the English school of thought, represented 6y E.EL Brech, Henry Fayol, Kimball and
Kimball, management is a wider concept than administration. Administration handles the current
problems that may arise in carrying out the policies laid down by management. Management is the
rule-making and rule-enforcing body. It is an all-encompassing and comprehensive term and
administration is a part of it. Administration is just an implementing agency.

 MANAGEMENT AND ADMINISTRATION ARE IDENTICAL

'Writers like William Neutman, Harold Koontz, Dalton E. McFarknd, Earnest Dale, hardly maintain
the distinction berween the wo terms. Any attempt to stretch the matter too far may be self defeating
and thoroughly misleading. The compartmentalization scheme hardly serves any useful purpose. The
management Process is the same in all organisations and at all levels in the organization and there is
hardly any need to appoint two individuals to discharge the administrative managerial functions.
All undertakings require planning, organisation, command, coordination and control in order to
function properly, all must observe the same general principles, we are no longer confronted with
several administrative or management sciences, but with one which can be equally applied well
to public and to private affairs. A manager or for that matter an administrator, has to wear both the
hats gracefully in order to be effective and successful.

 HOW TO RESOLVE CONTROVERSY

To resolve the controversy, Drucher suggested that, management is applicable in business enterprises
while administration is applicable in government offices, military organizations, social and cultural
institutions. From a theoretical point of view, writers still continue to maintain distinction between
the Two terms
However, from a practical point of view, the above categorization seems to be a futile exercise.
Managers or administrators have to perform the thinking and doing functions simultaneously. They
have to wear both the hats gracefully in order to be effective and successful.

 Management:-Science or Art ?
The question whether management is a science, art or profession is put to debate quite frequently. There are
arguments on both sides. Let examine these in detail:-

 PROPERTIES OF SCIENCE:-
 Science is a systematized body of knowledge based on certain principles, capable of general application.
This knowledge is obtained through the process of observation, experimentation and testing. Science, thus,
has four elements:-

1) Systematic body of knowledge: Science is systematized in the sense that it is based on the cause and effect
relationship between different variables. Such a knowledge helps in explaining past events and predicts the
outcome of specific actions.

2) Scientific inquiry and observation: Scientific inquiry is unaffected by the personal likes and dislikes of a
scientist. 'When we say that the rotation of earth causes days and nights, we do not express the opinion of
just one person. This can be scientifically proved at any time.

3) Experimentation: The principles of science are derived after repeated observations and experiments. The
results of each experiment can be verified and outcomes predicted in a definite way.w'hen results get
confirmed after repeated experimentation, they become principles.

4) Universal truths.:- Scientific principles represent basic truths, they are developed after a series of
experiments. they can be applied in all situations and at all times.

 Management as science

Management is a science because it has all the characteristics of a science, namely:

A Systematized body of knowledge: Management is a distinct discipline. It has a number of

principles which can be studied and put to application. Management offers principles that
could be put to good use while solving problems.

Management is a social science: Management is a social science, as it deals with human

behavior about which little is known at present. As we all know, it is not possible to study
human behaviour under controlled laboratory conditions. Human behavior is unpredictable
and, therefore, defies experimentation. fu a result, the principles of management cannot be
accepted as absolute roughs. They are still in a developing stage and evolutionary in nature.
Management, at best, can be called as a soft science.

Management is an inexact science: Management is not an exact science like physics, chemistry
or biology. It does not offer absolute principles. It can offer only flexible guidelines that would
be of use in solving problems. Management can never be an exact science because business is
highly dynamic and business conditions change continually.

Manager vs. scientist. A scientist can afford to wait until all the information (about a thing) is
available. He can indulge in a series of experiments till the truth emerges clearly. However a
manager cannot afford to do like that. He must take decisions based on inadequate information,
insufficient knowledge and resources. He must make decisions today in order to survive in
future.
Scientific management :- when taylor used the term ‘scientific management', he was aware of the fact that
experimentation and verification of facts is not possible in managing human resources. He had used the term
'scientific', as an organized body of knowledge as opposed to traditional rules and empirical dexterity. Over the years,
the traditional hit-or-miss methods have yielded place to several systematic methods based on principles. No wonder,
management is known as a 'sophisticated behavioral science' these days. Thus, art and science are complementary
and mutually supportive.

 PROPERTIES OF ART

Art is the application of knowledge and personal skills to achieve results. It is a way of living. Art is based on the
knowledge of principles offered by science. A surgeon or a physician without the knowledge of medical science
becomes a witch doctor, with the knowledge of science, an artful surgeon. Art is basically concerned with application
of knowledge, how to do things creatively and skillfully.

Management as an Art
Management is basically an art as it involves the use of knowhow and skills like any other art such as music, painting,
sculpture, etc, The practical knowledge acquired in the areas of planning, decision-making and motivating certainly
help managers to tackle problems in a better way. The arguments in Favor of management as an art run thus:

1) Use of knowledge:- Just as a doctor uses the science of medicine while diagnosing and treating the
patients, a manager uses the knowledge of management theory while performing the managerial functions.
He, thus, uses sound knowledge in place of hit-or-miss methods, with a view to achieve results effectively.

2) Creative art :- Management is creative Like any other art. It combines human and non-human resources
in a useful way so as to achieve results. It tries to produce sweet music by combining the chords in an
effective manner. It makes things happen by changing the behavior of human beings.

3) Personalized :- Like any other art, management is a personalized activity. Every manager has his own
way of managing things and people, based on his knowledge and experience. There is no one way of doing
things. As years roll by, managers learn the art of managing through a process of trial and error.

4) Constant practice:- Managers learn from mistakes. The application of managerial principles over a
period of time enable them to tackle difficult problems with confidence. In other words, they develop their
skills through constant practice. Just as artistic skills can be developed through training, so can
managerial skills.

 MANAGEMENT :- SCIENCE AS WELL AS ART

Management is thus, an art as well as a science. The art of management is as old as civilization. The science of
management is young and developing. Both are complementary and mutually supportive. Managers need to acquire
the knowledge of management principles and practice in order to be successful. They need to sharpen this
knowledge through constant practice. The theoretical knowledge in management must be put to good use in a skilful
way, while achieving results. As Drucher has pointed out, every organization has the same resources to work with. It
is the quality of management that spells the difference between success and failure. Managers need to acquire
knowledge systematically and put the same to good use, using intuition, judgement and experience. A successful
manager is one who is able to visualize problems before they turn into emergencies. The ability to meet the problems
head-on does not come by chance. It requires sound knowledge and constant practice. Managers, therefore, have to
fruitfully combine their scientific knowledge with artistic skills in order to emerge€ as the "winners' in a competitive
environment.

Management as a Profession

The question, "Is management a profession?" is asked quite frequently. Over the last few decades, factors such as
growing size of business units, competition, separation of ownership from management have led to an increased
demand for professionally qualified managers. The tasks of management have become quite specialized. As a result
of these developments, claims are being made that management has reached a stage where everything has to be
managed professionally. Before supporting this claim, let's state the essential features of a profession and find out
how far these features are Present ln management.

 CHARACTERISTICS OF A PROFESSION

The important features of a profession are:-

1) Well -defined body of knowledge: A profession must have a systematic body of principles, techniques and
skills.

2) Formal education and training: Everybody cannot enter a profession. An individual can enter a profession
only after acquiring knowledge and skills through formal education and training .

3) Minimum qualification: An individual can enter a profession after obtaining a degree or diploma from
recognized colleges, universities or institutes.

4) Representative body: A representative body of professionals exist to regulate and develop the professional
activities. It (i) tries to regulate the entry of people into the profession (ii) conducts the examinations from
time to time (iii) issues the certificate of practice and (iv) carries out other activities (R&D, liaison work, etc.)
aimed at developing the profession.

5) Service above self According to Edgar Schein, a profession must be committed to service. Success in work
should be more important than financial rewards or political gains. Service to society should be the ultimate
motto.

6) Ethical code of conduct: A strict code of conduct exists in every profession. Members of a profession are
expected to follow the code sincerely and honestly.
Management As a Profession:-

W'ell-defined body of knowledge: Management has a well-defined body of knowleclge that is

generally valid in a variety of organisations and situations. Management literature ha, been
continually growing. Many tools and techniques have been perfected over the years. Research
and consultancy firms aid managerial thinking and practise now-a-days. They produce a lot of
data, aimed at improving managerial decision-making.

1) Formal education and training: Acquiring management education through training is possible
now. A number of management institutes have been set up in recent years, ro turn out a good crop of
managers throughout the globe. The old saying that managers are born not made stan& discounted and
depreciated now. Business houses also prefer only properly educated and trained managers while filling
their vacancies.

2) Representative body: As things stand now, there is no organisation or body of professionals whose
membership is essential to become a manager. There is no organisation whose authority is recognised
as final. In the case of lawyers, it is necessary to become a member of the Bar Council of India, in the
case of doctors, it is the Medical Council of India. Flowever, such entry requirements do not exist in the
field of management. In fact, the entry into the field of management is not regulated. Further, no
minimum qualification has so far been laid down for managers. There is also no licensing of managers.
There are several management associations, howeve6 offering training and research support to
managerial work. But no such association enjoys the legal sanction to regulate the activities of
managers throughout India.

3) Code of conduct: There is no universal code of conduct. Although, certain trade associations and
management associations (All India Managemenr Association, ior exarnple) have formulated ethical
codes for managers working in particular industries, these have not been accepted totally.

4) Service motto: In the absence of a regulating body (with legal sanction) and code of conduct,
managers often indulge in practises aimed at maximising their personal wealth. The service motto
stands thoroughly neglected. In recent years, however, this view of management is progressively
changing. To survive in a competitive world, managemenr has ro reconcile the conflicting interests of
the shareholders and workers on the one hand and meet the social obligations of business, on rhe
other. They have to balance these conflicting inrerests while making profit.

 PROFESSIONALISATION OF MANAGEMENT

In conclusion, we can say that management is not a recognized profession, but it is moving in the direction of
becoming a profession. Factors such as separation of ownership from management' government regulation of
business activities, proliferation of management institutes, growth of trade unions have led to the increased
professionalization of management in recent years. Increased professionalization implies licensing, formal education
and degrees, regulatory codes, and so on. However, writers like Drucker believe that there should be no statutory
control over managers. He firmly argued that managers must be known by their performance, rather than by their
degrees. According to Druckex "no greater damage could be done to economy and society than to attempt to
professionalize management by licensing managers or by limiting access to management to people with special
academic degree".
  PROFESSIONALISATION OF MANAGEMENT IN INDIA

There are very few success stories that can be told, since the achievement of Indian Independence in 1947.If one
among these exceptions is the record of the farmer, another is the story of the manager. There are many
professionally managed companies in India now, Hindustan Lever Limited, TISCO' TELCO, Indian Oil Corporation,
Oil and Natural Gas Commission, Bharat Heavy Electricals Limited, ITC Limited, Indian Oxygen Limited, LSaT,
NTPC, etc. The list of professionally managed companies is impressive and is growing day by day. These companies
fill their vacancies with the best brains in the industry (qualified management graduates), introduce and experiment
with modern concepts of management (like Theory Z, Quality circles, etc. For example, in Maruti Udyog Limited).
Managers set organizational objectives keeping the social objectives in mind (e.g., allocation of budget for
pollution control, community development, family planning clinics, etc. by Tatas, Birlas, Kirloskars, etc.) and
encourage their personnel to attain a high level of professional competence, In order to develop their human
resources, these companies regularly invest heavy amounts in management/ executive development programmes,
organized by NPC, AIMA, NIBM, ASCI' NITIE, etc. Some companies even maintain in-house training departments
(Steel Authority of India, LIC, Hindustan Lever, TELCO, TISCO, ITC Ltd, etc.) for this purpose. Now-a-days, even
comparatively smaller organizations are deputing their managers to attend short-term training courses/management
development programmes. The concept of owner-managers is being increasingly rejected now and even small-scale
units do not hesitate to send their personnel to executive development Programmes throughout the country. The
reasons for this are not far to seek':-

 Growing competition of the market'

 Fast changes in technology'
 Divorce between ownership and management.
 The need to manage large-scale units in an effective way and show profits (instead of surviving on
government subsidies, Protection, etc').
 Growing professionalisation in the private sector.
 Rapid expansion of management education in recent times and the proliferation of reputed
management schools/ institutes throughout the globe.

Formal education and training have become increasingly important for present-day managers.
They have to manage the show and emerge as winners. Traditional management techniques and
practices may not help in delivering the goods in an effective and efficient manner. Under the
circumstances, not surprisingly, the trend towards increased professionalisation of management is
gaining strength and universal acceptance.

Principal of Management
A principle is a basic statement or a fundamental truth that provides understanding and guidance to thinking and
practice. A principle represents a basic element of knowledge in that it explains the relationship and, helps in
predicting what would happen if the principles were applied. Over the years, a number of principles have been
developed in management to aid executive thinking and action. A group of concepts have been developed by
experience and responsible research. These principles, as pointed at by J.L. Massie, are only 'approximations of
generalizations from experience.' As such, they should not be treated as rigid and inflexible rules to administrative
behavior. The principles, however convenient as a shortened method of thinking, are only guides to action. If they
become rules, they lose their utility.

NATURE OF MANAGEMENT PRINCIPLES

Management principles can never be stated as rigorously as that of physical sciences because human beings behave
more erratically than physical phenomena. Management principles have been developed out of experience and
analysis only. The empirical support for most of these principles is woefully inadequate. In the absence of a scientific
analysis, these principles must be taken as general ideas on which sound and effective action can be based. They
are, thus, not absolute truth, of infallible laws. Managers should not conclude that principles are rigid and that there is
some definite list chiseled in stone. Moreover management principles are ever-changing. Most of the so called
'golden' principles of management (scientific management and bureaucracy especially) have been replaced.
Refinements are taking place continuously. This is made possible by the ever-increasing research activity in the field
of management. Thus, management principles change with the change in the environment in which the organisation
exists. The principles must be accepted as flexible and dynamic guidelines and not as rigid and static guidelines. One
serious limitation with reference to management principles should be noticed here. As one writer pointed out, where
human beings are concerned, management principles may be so much of wastepaper. Because of the
unpredictability of human nature, the principles of management do nor find expression in a universal way.

WHY MANAGEMENT PRINCIPLES?

According ro Tbrry, 'Principles of management are to a manager as a table of strengths of materials is to a civil
engineer. ‘The utility of principles lies in the foundation they provide for its efficient conduct, by making out the basic
features that must characterize the practice of management, irrespective of where it is occurring. By means of
principles of management, a manager can avoid fundamental mistakes in his job and foretell the results of his actions
with confidence. According to Koontz, principles help in the following ways:

To increase efficiency: Principles aid thinking and action. The need for guesswork, haphazard activities is
reduced. The problems brought out by rapid changes in the environment can be solved easily. For example, the
principle of span of control tells a manager that he can manage only a limited number of subordinates, say 8 to 10,
and thereby helps him predict the results if the principle is not applied.

To crystallize the nature of management: Principles crystallize the ever-increasing knowledge and thinking in
the field of management. \Without principles, it is not possible to impart knowledge and provide training ro managers.

To improve research in management: Management deals with human beings whose behavior is highly
unpredictable. Principles provide a canopy of broad generalizations which help in testing behavior, understanding it
and predicting the outcomes for Future. They help in improving the fund of tested knowledge and promoting further
research in human behavior.

To attain social goals: Management principles play an important role in improving the quality2 of life of people
and the standard of living. They bring order our of chaos. Managers are able to commit resources to the best possible
advantage and employ them in a judicious fashion.

 WHAT ART PRINCIPLES OF MANAGEMENT?

1) Fayol principles: It was Henry Fayol who stated a set of l4 principles of management based on his
practical experience as a manager. According to Fayol, these principles can be applied in all types,
functions, levels and sizes of organisations. For a long time, Fayol list was accepted as complete and
comprehensive.
 2) Mooney and Reileyt staff principle: According to order to provide service and expert advice to the
this principle, staff units must be created in line managers.

3) Thylort principle of management by exception: Routine work, according to this principle, must
be handled by subordinates and management must concentrate on strategic, key and important issues.

4) W'ebert principles: Organization work must be performed according to rules. All administrative actions
must be recorded in writing so as to have a ready reference in future: a hierarchy of' positions should
provide for supervision of each unit by a higher official etc.

5) Likert's principle of supportive relationship: According to this principle, managers should

provide social, psychological and moral support to subordinates. The basic purpose should be to improve
the subordinate's sense of personal usefulness and dignity and secure commitment to organisational goals.

6) Human relations: Human relatitionists (Mayo and Roethlisberger) and behavioral scientists (McGregor,
Bennis, Argyri) have avoided providing prescriptions and have suggested ideas and concepts to describe
some fundamental guides to managerial thought and action. These concepts are largely aimed at improving
the 'quality of life' rather than achieving organisational goals. The importance of human element is
recognized and efforts are made to make human life more interesting, meaningful and challenging in an
organization.

7) Modern organisation theories and principles of management: Systems and contingency

theorists advocate that, a manager should know and understand the existence of certain fundamental
concepts advanced by theorists from time to time and use them judiciously. Managers should understand
that there is a way to apply these concepts. The principles must be applied in a flexible way, keeping the
changing circumstances in mind.

Universality of Management Principles

Is the manager’s job universal? Are the principles of management universally applicable? It has alreadybeen stated
that managing is found in all types, functions, levels and sizes of organisations. Management can be applied to all
organized human efforts, whether they are in business, government, educational, social, religious or other fields,
Universality of management suggests that the manager uses the same managerial skills and principles in each
managerial position held in various organisations. Accordingly, an industrial manager could manage a philanthropic
organisation, a retired army general could manage a universiry a civil servant could manage an industrial
organisation, and so on.

Universaliry implies transferability of managerial skills across industries, countries. It means that management is
generic in content and is applicable to all types of organisations. Laurence A. Appley declared that 'He who can
manage, can manage anything.' Let us examine the factors that have contributed to the universal application of
management at every level of organisation.

 ARGUMENTS FOR UNIVERSALITY

 1) Same functions: Quite often, ir is erroneously thought that management exists only in a business and not
in other enterprises. The fact is, however, that when acting in their: respective managerial capacities, not
only the company president but also the office supervisor perform the fundamental functions of
management. The difference lies in such things as the breadth of the objectives, the magnitude of the
decisions taken, the organisational relationships affected, and so on. Managers essentially perform the
same functions, irrespective of their level in the organisation, industry or country.

2) Universal principles: Classical writers (Fayol, Urwich and others) believed that, there are certain
principles in management which are universally applicable. These are the principle of departmentation,
principle of division of labour, principle of span of control, the scalar principle, principle of unity of command,
etc. Such principles as one-man one boss, division of work to improve speed and efficiency, limiting the
number of persons to be supervised so that managers can concentrate on exceptional problems, the
principles governing motivation theory have certainly proved their worth up to a point, and these principles
have been translated into practice for a long time. These principles have Found universal application in most
organisations.

3) Fundamentals are same, the techniques employed and practices followed are different Managing
occurs in parks, ranches, hospitals, farms, universities, cities, police, agencies, churches, airports and
community organizations, industries, and so on. The fundamentals governing the management of a
business, a church or a university are same: the difference lies in the techniques employed and practices
followed. All managers are accountable for performance of other people: they plan, make decisions,
organise work, motivate people and implement controls and so forth. In order to accomplish things, the
techniques employed might differ depending on situational - factors like: culture, tradition, attitude, etc.
Same is the case with management practises, An automobile designed for use in deserts or jungles will be
markedly different from the one that is designed for city traffic. The design principles governing both models
are the same. The generic content of management fundamentals is such that they can be applied
universally. However, the practises and techniques employed may differ depending on the nature of
industry, the organisational level where these are applied, etc.

4) Practical evidence: Managing is found in all types, functions, levels and sizes of organisations. The fact
that managers regularly move from public to private sector organisations bear sample testimony to the fact
that, management concepts are universal across organisational types. For example, D.D. Eisenhower went
from a General in the U.S. Army to President of Columbia University to finally become President of the
United States. Again, Sri PL. tondon, the former Chairman of Hindustan Lever Ltd, has managed the PNB,
STC and the NCAER successfully during his tenure as the Chairman in these organisations. The basic
concepts of management propagated by American writers have found expression even in communist
countries. According to Drucher, "the rapid development of Brazil, the rapid development of non-communist
countries, that is, of Hongkong, Singapore, and Thiwan, the rapid development of so poor and backward a
peasant country, as Iran, are all traceable to the impact of management".

 ARGUMENTS AGAINST UNIVERSALITY

Complete substitutability is impossible:-It is true that the manager's job becomes most universal in
content at the upper echelons of organisations. The higher on€ moves in an organisation, the more he or she
performs the generic frictions of management, such as planning, organising, Leading and controlling and the less he
or she is involved in day-to-day technical matters. The relationship between performance and frictions entrusted
becomes more intense as one moves lower down the order. For example, the success of a drilling supervisor of an oil
rig depends, to a large extent, on his technical knowledge o[drilling. On the other hand, the president of an oil
company does not need to have much of the technical intricacies of drilling for oil or how to refine it. Before tossing
the ‘universality argument', we must apply brakes and quality. The statement: generic in content does not imply
complete substitutability.

Organisational philosophies differ:- Universality presupposes the existence of predictability regarding the
outcome of managerial actions. A manager working in Firm A must be able to predict the likely consequences of his
actions in Firm B, where he is likely to join. He may have to Face insurmountable difficulties, in case the underlying
philosophies of these organizations were to differ. For instance, in one organisation the emphasis might be on profit
maximization and in the other, the emphasis might be on social responsibilities. Such conflicting demands
affect managerial actions and what a manager could apply with success in one organir"tior, -"y not find a meaningful
expression in the other organisation where the underlying philosophy is different. fu pointed out by Dale, no individual
could be a good administrator in religious, academic, military and business institutions of both communist and
democratic countries because the philosophies that underlie each are drastically different and one person may nor be
, able to cover so much ground.

Universality of principles:- a ridiculous statement? Classical management principles were written by

practitioners in management and were based on personal experience and observation only. They have only tried to
pass on their ideas as universal truths. In the absence of a rigorous scientific basis, no wonder, Simon dubbed the
principles as proverbs, comparable to folklore and folk wisdom. Moreover, these principles are vague and too general
and as a
result, are very difficrrlt to apply to a specific organisation. They often overlap and are. sometimes incompatible with
one another. The terminology 'universal principles', 'universal truths' is quite unfortunate.

Management is a product of the culture:- Managers have to operate within the broad constrainers
operating in an economy: culture, tradition, organizational philosophies, erc. Managerial behavior in a deeply
traditional, religious economy is bound to be different from the advanced and scientificelly-oriented economy. It is
futile to search for a common set of 'principles' or 'absolutes' or 'determinate solutions', where managers have to
operate in highly diverse
A career in management is, by itself, not a prepararion for major political or for leadership in the armed forces, the
church or a university.

The writers who argue that management principles are culture bound seem to ignore that the fundamentals governing
the management of enterprises in India, Japan, U.S.A. and Brazil are the same and they are applicable and
adaptable in various cultures. Otherwise, it would not have been possible for Indian managers doing successful
business in Great Britain, Chinese management thinkers teaching in America and Japanese managers working
successfully in Brazil ".,d Fiorrgkong. The universality of management thesis is well supported by several research
studies by liair,'porter, Negandhi and Richman, etc' According to these researchers, cultural and situational factors
may influence the way in which a manager discharges his functions but the fundamentals of management remain
unchanged.

Summary

Management is the process of planning, organizing, staffing, directing and controlling to accomplish objectives
through the coordinated use of human and material resources. Management thinkers have tried to interpret the term
in multifarious ways: as a noun, as a process, as a ream, as a discipline, as an activiry as an economic resource, as
a system of authority or as a distinct class in society having its own value system.

Management is the life-blood of a business. It ensures optimum use of scarce resources, offers competent
leadership, ensures peaceful industrial relations, achieves goals, improves standard of living and enables a company
to manage change effectively.

The terms ‘management' and ‘administration' are often interpreted in a loose manner. Some take management and
administration as one. Some consider administration broader than management and some hold that administration is
part of management. To avoid confusion, people like Drucker suggested that, management is applicable in business
units while administration is applicable in government offices, military our fits and social and cultural institutions.
Management is being increasingly accepted as a soft science and also as a difficult and complex art, as it deals with
human behavior which is highly unpredictable. Management, from another standpoint, is also interpreted as a
profession having a well-defined set of principles and practices capable of universal application. Professionalization,
no doubt, helps the discipline to acquire a distinct character and recognition of its own but trying to link and measure
managerial success in terms of degrees may come in the way of developing creative entrepreneurs having brilliant
ideas but not professional qualifications.
Over the years, the subject of management has been written and re-written in terms of certain well-accepted
principles and time-tested practices. These principles are the products of years of experience, research and analysis.
They are not to be interpreted as absolute truths. When applied carefully, using discretion and judgment, they have
proved to be quite successful in delivering results at various points of time all over the world.

Review Questions
1) Define management and outline its essential characteristics.

2) Examine the following statements critically:

Management is regarded as an arr by some and a science by others'.
'Management principles are universal in nature.'
'Management is the dynamic, life-giving element in every organization.'

3) List and briefly discuss the functions of management.

4) Which factor - ability motivation to manage or opportunity- should be most heavily weighted in the basic
formula for managerial success?

5) what can an individual manager do to meet the challenge to improve productiviry?

6) Distinguish between administration and management.

7) "He who can manage, can manage anything". Critically examine the sratemenr.

8) what do you mean by principles of management? Bring out the essential features of management principles.

9) write a note on professionalization of management.

10) How important is the management function to individuals and society?

11) write short notes on:

 Management as a process.
 Management as a discipline.
 Management as an activity.

12) 'Management is a sophisticated behavioral science'. Elucidate.

 13) 'The word management has several meanings, depending on the context and purpose'. Discuss.

14) 'Management is the development of people, not the direction of things'. Discuss.

15) 'Management is to business what the mind is to a human being'. Examine rhe statement
critically.

 Skill Building Exercise

 ASSESS YOUR LEADERSHIP POTENTIAL

Read the statements below carefully. After each statement, circle whether you agree or disagree. Do
this for all eleven statements before you look at the answers.
1) Good leaders are born, not made. Agree Disagree
2) I tend to treat my subordinates well as long as they do what I say. Agree Disagree
3) Good leaders depend on their followers as much as they depend on themselves. Agree Disagree
4) As a leader, I would always include the reasons when asking a subordinate to perform a task Agree
Disagree
5) A good leader will achieve his or her objectives at any cost. Agree Disagree
6) fu a group manager, I would never entrust an important project to anyone but myself, even if it means working
overtime. Agree Disagree
7) A key to good leadership is being consistent in how one leads. Agree Disagree
8) If justified, I would recommend a subordinate for a promotion to a position equal to or even higher than my own
position. Agree Disagree
9)Some subordinates can participate in the decision-making process
without threatening a leader's position. Agree Disagree
10) If my group failed to achieve an objective because of a group
member's failure, I would explain it as such to my superiors. Agree Disagree
11) I consider myself indispensable to the company in my present position.
Agree Disagree
Scoring Your Responses
A point value has been assigned to each statement. To determine your score, simply total the values
of your responses.

Agree disagree

Agree disagree
agree disagree

agree disagree

agree disagree
agree disagree
agree disagree
disagree
agree disagree
agree
agree
agree

To facilitate understanding, the scoring is now briefly explained.

1) Although some leaders are born, for the most part, leadership is an acquired management skill.

2) The thinking expressed in this statement is similar to the Machiavellian concept of the benevolent dictator.
Although, such behavior can be useful, it tends not to be successful.

3) Mutual dependence is important. The best results cannot be achieved single-handedly.

4) Here "always" is the key word. Subordinates do not always need nor should they always be given the
reasons why. For example, when a company is negotiating to acquire another business, the confidentialiry
of the situation does not allow the leader to give reasons for certain actions.

5) whilst achieving one's objectives is important, it should not be done at any cost. Sometimes, the costs may
outweigh the value of the goal. Also, if a manager achieves a goal at the expense of his subordinates, it
could lead to failure in achieving subsequent objective..

6) A good leader recognizes the need to delegate responsibility to competent subordinates. when justified, this
should include responsibility for important projects.

7) There is no one way of being an effective leader. The effective leader is flexible, and changes his approach
to meet the needs of the particular employee and/or situation.

8) A successful leader is also a successful trainer. One result of effective leadership is the ability to promote
qualified subordinates to any level.

9) In participative decision-making, by experienced and knowledgeable subordinates, the leader's role is not
usurped.

10) An effective leader always takes responsibility for a subordinate's actions, whether those actions result in
success or failure. The ineffective leader blames everyone and everything except himself.

11) No one is or should be indispensable. If you feel that this is the case, you have succeeded in locking
yourself into a situation, from which you cannot progress. Stagnation is the result.

Assessing Your Potential

In assessing your score, bear in mind that this device is not a test but an indicator of your leadership
potential. If your score was 11 to 9, you have excellent potential; indeed, your leadership ability
is probably already self-evident. A score of 8 to 6 shows good potential but that some thinking
needs to be sharpened or changed. A score of 5 to 0 suggests that, drastic changes are needed and now
How did you do ?

It is important to recognize that individuals can change over time. that you scored today is not
necessarily what you will score tomorrow. It could be better, but it could also you be worse. That’s why need to
monitor periodically your thinking about leadership style. There are three ways you can manage this monitoring
process. Firstly, you can look at other supervisors and manager decides which firm would follow why would you
follow, them is their behavior consistent with the response to the 11 statements discussed? Consider, too, those
whom you would not follow and why and how does their behavior differ from those individuals whom you would
follow? Answering these questions can provide a better understanding about your own leadership style because the
type of leader you would follow is the type of leader you would follow to be. secondly, you should go back and review
the statements. Do the explanations make sense to you? Could you successfully apply them to situations at work? If
not, why not? In answering this last question' try to be specific as possible. Listing all the negative reasons is a
worthwhile exercise, since these reason probably reflect your own behavior. Leadership, itself, is a positive force. It's
a positive force for your subordinates and your organization' But to be effective, leadership has to be monitored
periodically by the one person most benefit-you.

CASE STUDY
"Left or Right?"

Rajinder Kumar was production worker at Competent Motors Limited (CML), which made components and
accessories for the automotive industry. He had worked at CML for almost seven years as a welder, along with fifteen
other men in the plant. All had received training in welding, both on the job and through company-sponsored external
programmes. They had friendly relations and got along very well with one another. They played volleyball in the
playground regularly before retiring to the quarters allotted by the company. They ate
together in the company canteen, cutting jokes on each other and making fun of anyone who dared to peep into their
privacy during lunch hour. Most of the fellows had been there for quite some time, except for two men who had joined
the ranks only rwo months back. Rajinder was generally considered to be the leader of the group, so it was no
surprise that when the foreman of the department was transferred and his vacancy was announced, Rajinder applied
for the job and got it. There were only four other applicants for the job, two from mechanical section and two
from outside. when there was a formal announcement of the appointment on a Friday afternoon, everyone in the
group congratulated Rajinder. They literally carried him on their shoulders and bought him snacks and celebrated the
event enthusiastically. On Monday morning, Rajinder joined duty as Foreman. It was company practice for all
foremen to wear blue jacket and a white shirt. Each man's coat had his name badge sewn onto the left side pocket.
The company had given two pairs to Rajinder. He was proud to wear the coat to work on Monday. People who saw
him from a distance went uproot him and admired the new blue coat. There was a lot of kidding around calling
Rajinder as 'Hero', 'Raja Babu' and 'Officer' etc. One of the guys went back to his locker and returned with a long
brush and acted as though he were removing dusr particles on the new coat. After about five minutes of horseplay, all
of the men went back to work. Rajinder went back ro his office to get more familiar with his new job and environment
there. At noon, all the men broke for lunch and went to the canteen to eat and enjoy fun as usual. Rajinder was busy
when they left bur followed after them a few minutes, later. He bought the food coupon, took the snacks and tea and
turned to face the open canteen. Back in the left side corner of the room was his old work group; on the right-hand
side of the canteen sir all the other foremen in the plant - all observed in their blue coats. At that point of time, silence
descended on the canteen. Suddenly both groups looked at Rajinder anxiously, waiting to see which group he would
eat with.

Questions
 whom do you think Rajinder will eat with? why?

 If you were one of the other foremen, what could you do to make Rajinder's transition easier?

 what would you have done if you were in Rajinder's shoes? why?

Xxxxxxxxxxxx
Managerial Roles,

Functions and Skills 2

Advice for all young managers

Remember, good worth that pleases your superior is the basic foundation of success, but also recognize that not all
good performance is easily measured. Determine the real criteria by which you are being evaluated and be rigorously
honest in evaluating your own performance against these criteria:

 Manage your career; be active in influencing the decisions that will be made about you, because pure effort
is not necessarily rewarded.

 Strive for positions that have high visibility and exposure, where you can stand out as a hero and be
observed by higher officials. Check to see that the firm has a formal system for heaping track of young
people. Remember that high-risk line jobs tend to offer more visibility than do staff positions such as those in
corporate planning or personnel, but that visibility can sometimes also be achieved by off-job community
activities.

 Develop relations with a mobile senior executive who can be your sponsor. Become a complementary
crucial subordinate with silk different from those of your superior.

 Learn your job as quickly as possible and train a replacement so that you can be available to moue and
broaden your background in different functions.

 Nominate yourself for other positions; modesty is not necessarily a virtue. However, change jobs for more
power and influence, not primarily for status or pay. The latter could be a substitute for real opportunity to
make things happen.

 Before taking a position rigorously, assess your strengths and weaknesses, what you like and don't like.
Don't accept a promotion if it expose your weaknesses and entail mainly activities that you don't enjoy
  Leave the organisation at your convenience, but on good terms and without parting criticism. Do not stay
under an immobile superior who is not promoted in fue years.

 Do not be trapped by formal, narrow job description Move outside them and probe the limits of your
influence.

 Accept the facts that responsibly will ashtrays somewhat exceed authority and that organizational politics is
inevitable. Establish alliance., and fight necessary battles, Limiting upward ones to our important issues.

 Get out of management if you cannot stand being dependent on others and having others dependent on you

 Recognize that you will face ethical dilemmas, no matter how moral you try to be. No evidence exists that
unethical managers are more successful than ethical ones, but it may well be that those who move you
faster are less socially conscious. Therefore, from time to time you must examine your personal values and
question how much you are willing to sacrifice for the company.

 Do not automatically accept all title tales of managerial perversity that you hear. Attributing the success of
others to unethical behavior is often an excuse for one's own inadequacies. Most of all, do not commit an act
you know to be wrong in the hope that your superior will see it as loyalty and reward you for it. Sometimes
he will, but he may also satisfy you when the firm is criticized

INTRODUCTION

According to Kreitner, management is the process of working with and through

others to achieve organizational objectives in a changing environment. Central to this process is the
effective and efficient use of limited resources. A manager is effective if he reaches a stared objective
and, efficient if the limited resources entrusted to him are nor wasted in the process. This definition
contains five important components that require a closer examination

(a) Working with and through others: Managers get results by working with and through others.
Managers who do not get along well with others hamper their careers as revealed by a study of derailed
managers.

( B) Achieving goals: Managers are at the top to Formula are and achieve stated goals. Organisations ate
more successful when their activities are guided by challenging, yet, achievable goals.

©Balancing effectiveness and efficiency: As managers use their resources, they must strive to be both
effective and efficient. Managerial effectiveness is defined in terms of resource utilization in relation to organizational
goal attainment. Effectiveness entails promptly achieving a stated objective. If organizations use their resources to
achieve their goals, the managers Efficiency, on the other hand, is the achievement of ends with the least amount of
resources. The more resources wasted or unused during the production process, the more inefficient the manager.
(d) Making the most of limited resources: Managers have to use physical, financial and human resources in a
prudent way and achieve stared goals.

(e) Coping with a changing environment: successful managers are the ones who anticipate and adjust to
changing circumstances rather then being passively swept along or caught unprepared Successful managers,
according to Petet' t Druckcr, do not wait for future; they make the future.

Who are managers ?

Managers are the 'coordinators' and 'directors' in the organization. They are the individuals charged with examining
the workflow, coordinating efforts, meeting goals and providing leadership. In terms of authority, managers possess
the right to command others in their areas of responsibility. Each manager reports to someone higher in the
organization in what constitutes a theoretical chain of command from the top to the bottom of the structure. Managers
usually do not directly perform any of the workflow activities. They are there to direct, coordinate and assist the rank
and file who handle these functions. They are also the activating elements that provide leadership and rewards to get
results.

What do managers do ?
Managers generally work for long varied activities, they interact with hours, their days are broken up into a large
number of brief and large number of different people, they do little reflective planning and spend most of their time
engaged in oral communication (Reitz). They spend little time working alone. Time spent with others includes working
with bosses, peers, subordinates, as well as outsiders, such as customers, suppliers and the like. They spend a lot of
time getting, giving and processing information. Higher-level managers spend more time in scheduled meetings than
do lower-level managers. According to Stoner, managerial work is characterized by the following things:

 Managers work with and through other people: Managers work with internal (subordinates, supervisors, peers)
as well as external groups (customers, clients, suppliers, union representatives etc.) in order to achieve corporate
goals. They integrate individual efforts into teamwork. They plan things, create a structure, motivate people and
achieve goals.

 Managers are mediators: People working in an organisation do not always agree on certain things, say, the
establishment of goals and the means to achieve them. At the corporate headquarters of a large bank, managers may
think about expanding into merchant banking, leasing, credit card business, whereas at the branch level, people may
focus on expanding deposits by venturing deep into rural areas. Unless such differences are resolved quickly,
employees find it difficult to think and act like a well-knit group. Their morale, too, may suffer. Managers often step in
to put things in order, clear the paths to goals, clarify things to people, put out fires and meet goals.

 Managers are politicians: Managers must develop healthy relationships with various groups in order to achieve
the goals smoothly. They may have ro nurture groups and join certain coalitions within a company. They often draw
upon such relationships to win support for their proposals and decisions.
  Managers are diplomats: Managers serve as official representatives of. Their work units at organizational
meetings. They may Represent the entire organisation as well as a Particular unit in dealing with external groups
(clients, customers, government officials, etc.).

 Managers are symbols: Managers are symbols of corporate success or failure. They get applause when they
succeed and get depreciated and attacked when they fail. In short, they represent corporate as well as employee
aspirations. They are shown the door when these aspirations do not materialize.

Managers, obviously, are there to utilize corporate resources in the best possible way. To achieve results, they change hats,
shift gears and restructure and reorganize things continually. The diverse roles played by managers in discharging their duties
have been beautifully summarized by Henry Mintzberg in the late 1960s, under three broad headings: interpersonal roles,
informational roles and decisional roles.

Managerial Roles
Henry Mintzberg offered a view of the job of managing that throws considerable light on how managers perform their work.
Managers, according to Mintzberg, must fill many roles," they carry out the management functions. These roles can be grouped
into three categories: interpersonal, informational and decisional,

1. Interpersonal roles: Three interpersonal roles help the manager keep the organization running smoothly. Managers
play the figurehead role when they perform duties that are ceremonial and symbolic in nature. These include greeting
the visitors, attending social functions involving their subordinates (like weddings, funerals), handing out merit
certificates to workers showing promise etc. The leadership role includes hiring, training, motivating and disciplining
employees Managers play the liaison role when they serve as a connecting link between their organization and others
or between their units and other organizational units. Mintzberg described this, activity as contacting outsiders who
provide the manager with information. Such activities like acknowledgements of mail, external board work, etc., are
included in this category.

2. Informational roles: Mintzberg mentioned that receiving and communicating information are perhaps the most
important aspects of a manager job. In order to make the right decisions, managers need information from various
sources. Typically, this activity is done through reading magazines and talking with others to learn about changes in
the customers' tastes, competitors' moves and the like. Mintzberg called this the monitor role. In the disseminator
role, the manager distributes important information to subordinates that would otherwise be inaccessible to them.
Managers also perform the spokesperson role when they represent the organization to outsiders.

3. Decisional roles: There are four decision roles that the manager adopts. In the role of entrepreneur, the manager
tries to improve the unit. He initiates planned changes to adapt to environmental challenges. As disturbance handlers,
managers respond to situations that are beyond their control such as strikes, shortages of materials, complaints,
grievances, etc. In the role of a resource allocator, managers are responsible for allocating human, physical and
monetary resources. As negotiators, managers not only mediate in internal conflicts but also carry out negotiations
with other units to gain advantages for their own unit.

Functions of Management
managers are known by the work they do, the functions they perform. According to the functional approach, originated by
Henry Fayol, in every organisation managers perform. certain basic functions in order to achieve results. These functions may
be broadly classified into five categories: planning, organising, directing, staffing and controlling. Managers perform these
functions within the limits established by the external environment and must consider the interests of such diverse groups as
government, employees, unions, customers, shareholders, competitors and the public. A brief discussion of the five basic
functions is presented here

 PLANNING

Planning is the process of making decisions about future. It is the process of determining enterprise objectives and selecting
future courses of actions necessary for their accomplishment. It is the process of deciding in
Advance what is to be done, when and where it is to be done, how it is to be done and by whom. Planning provides direction to
enterprise activities. It helps managers cope with change. It enables managers to measure progress toward the objectives so
that corrective action can be taken if progress is nor satisfactory. Planning is a fundamental function of management and all
other functions of management are influenced by the planning process.

 ORGANISING

Organising is concerned with the arrangement of an organization’s resources - people, materials, technology and finance in
order to achieve enterprise objectives. It involves decisions about the division of work, allocation of
authoriry and responsibility and the coordination of tasks. The function increases in importance as a firm grows. A structure is
created to cope with problems created by growth. Through this formal structure, the various work activities are defined,
classified, arranged and coordinated. Thus, organising refers to certain dynamic aspects: what tasks are to be done? who is to
do them? How the tasks are to be grouped? who is to report to. Whom? Where the decisions have to be male?

 STAFFING

Staffing is the function of employing suitable persons for the enterprise. It may be defined as an activity where people are
recruited, selected, trained, developed, motivated and compensated for manning various positions. It includes not only the
movement of individuals into an organization , but also their movement through (promotion, job rotation, transfer) and our
(termination, retirement) of the organisation. Staffing involves selection of the right man for the
Right job. It has four important elements:

 Recruitment may be defined as the process of attracting the maximum number of applications for
a particular job.

 Selection is the process of screening the candidates and choosing the best ones out of them.

 Training involves imparting the necessary knowledge and skills required for the performance of a
particular job.

 Compensation is the price paid to the workers for the services rendered to the organisation.
  DIRECTING
The function of guiding and supervising the activities of the subordinates is known as directing. According to Dale, direction is
telling people what to do and seeing that they do it to the best of their abiliry. Acquiring physical and human assets
and suitably placing thern on jobs will not suffice; what is more important is that people must be directed towards
organisational goals. This work involves four important elements:

1) Leadership: Leadership is the process of influencing the actions of a person or a group to attain desired objectives. A
manager has to get the work done with and through people. The success of an organisation depends upon the quality
of leadership shown by its managers.

2) Motivation: Motivation is the work a manager performs to inspire, encourage and impel people to take required
action. It is the process of stimulating people to take desired courses of action. In order to motivate employees,
manager must provide a congenial working atmosphere coupled with attractive incentives.

3) Communication: Communication is the transfer of information and understanding from one person to another. It is
a way of reaching others with ideas, facts, and thoughts. Significantly, communication always involves two people: a
sender and a receiver. Effective communication is important in organisations because managers can accomplish very
little without it.

4) Supervision: In getting the work done it is not enough for mandgers to tell the subordinates what they are required
to do. They have also to watch and control the activities of the subordinates. Supewision is seeing that subordinates
do their work and do it as directed. It involves overseeing employees at work.

 CONTROLLING

The objective of controlling is to ensure that actions contribute to goal accomplishment. It helps in keeping the organisational
activities on the right path and aligned with plans and goals. In controlling, performances are observed, measured and
compared with what had been planned. If the measured performance is found warning, the manager must find reasons and
take corrective actions. If the performance is not found wanting, some planning decisions must be made, altering the original
plans. If the controlling function is to be effective, it must be preceded by proper planning. Thus, controlling includes four
things:1) setting standards of performance.2) measuring actual performance.3) comparing actual performance against the
standard and.4) taking corrective actions to ensure goal accomplishment.

Successful management involves active participation by managers in the above basic managerial functions. These functions are
interrelated and most managers use a combination of the four simultaneously to solve the problems facing their companies. AII
management functions are related and interrelated to each other as shown below

For theoretical purposes, it may be convenient to separate the management functions and study
Them independently but practically speaking, they defer such categorizations. They are highly inseparable.
Each function blends into the other and each can be performed in any order or sequence, nor
Necessarily in the order shown above, but tend to be performed (normally) in the planning, organising,
Leading and controlling sequence.

Skills of on Effective Manager

An effective manager must possess certain skills in the areas of planning, organising, leading, controlling and decision-making in
order to process activities that are presented to him from time to time.

Levels of Managements
All managers' positions involve performance of management functions (planning, organising, directing,
staffing and controlling). But there are differences among managerial jobs. the differences arises because of the existence of
various levels of management in a typical organisation. The term 'levels of management' refers to a line of demarcation
between various managerial positions. In a large organization, three levels of management are usually identified: (i) Top level
management (ii) Middle level management and (iii) lower level management. The functions performed by top managers,
middle managers, and lower level managers, respectively may be briefly stated thus:

 TOP MANAGEMENT

 Determines objectives and policies.

 Designs the basic operating and financial structure of an organization.
 Provides guidance and direction.
 Lays down standards of performance.
 Maintains good public relations.

 MIDDLE MANAGEMENT

 Interprets and explains the policies framed by the top.

 Issues detailed instructions.
 Participates in operating decisions.
 Trains other managers.

 LOWER MANAGEMENT

 Plans day-to-day operations.

 Assigns jobs to workers.
 Provides supervision and control over work.
 Arranges material tools and equipment.
 Maintains discipline.

Managerial Skills

In order to be effective, a manager must possess and continuously develop severalessential skills. Robert L. katz has identified
three basic types of skills - technical, human and conceptual - which he says are needed by all managers.
 a) Technical skill is the ability' to use the tools, procedures or techniques of a specialized field. Technical skill is
considered to be very crucial to the effectiveness of lower level managers because they are in direct contact with
employees performing work activities within the firm. For instance, the success of a drilling supervisor of an oil rig
depends a great deal on his technical knowledge of drilling. However, as one moves to higher levels of management
within the organisation, the importance of technical skill diminishes because the manager has less direct contact with
day-to-day problems and activities. Thus, the president of an oil company does not need to know much of the
technical details of drilling for oil or how to refine it.

b) Human skill is the ability to work with, understand and motivate other people. This skill is essential at every level of
management within the organisation, but it is particularly important at lower levels of management where the
supervisor has frequent contact with operating Personnel.

c) Conceptual skill is the mental ability to coordinate and integrate the organization interests and activities. It refers to
the ability to see the 'big picture', to understand how a change in any given part can affect the whole organisation.
The relationship between management levels and managerial skills

d) Technical skill is most important at the lower levels of management; it becomes less important as we move up the
chain of a command. A production supervisor in a manufacturing plant, for example, is likely to need more technical
skill than the company president, because he or she will have to deal with the day-today manufacturing problems
that arise. On the other hand, the importance of conceptual skill increases as we rise in the ranks of management.
The higher the manager is in the hierarchy, the more he or she will be involved in the broad, long-term decisions that
affect large parts of the organisation. For top management which is charged with the responsibility for overall
performance, conceptual skill is probably the most important skill of all. Human skill is very important at every level of
the organisation. One reason this is so is because to get the work done through others; high technical or conceptual
skills are nor very valuable if they cannot be used to inspire and influence other organisation members. Supporting
Katzls contention that specific skills are more important at some levels than at others is a study of managerial roles
and behavior by Jerdee and Caroll. More than four hundred managers from all levels of management and a variety of
types and sizes of business are asked to estimate how much time they spent on eight management tasks: planning,
investigating, coordinating, evaluating, supervising, staffing, negotiating and representing. Lower and middle-level
managers replied that supervising was their dominant activity, while top managers claimed to spend proportionately
more time on planning.

e) Design skill Koontz and. weihrich added one more skill to the above list. Design skill is the ability to solve problems in
ways that will help the organization. At higher levels, managers should be able to do more than see a problem, to
design a workable solution to a problem in the light of realities they face. If managers merely see a problem and
become problem watchers they will fail.

INSTITUTION BUILDING SKILLS

Top executives are usually thought of as the people who make the major decisions in an organisation. They often have
disjointed and widely varied tasks, ranging from figurehead duties to conducting meetings. They also have external duties,
including such varied ones as testifying at legislative hearings, greeting important customers, presiding at retirement luncheons
and sewing on the board of directors of agencies, such as a local college. The major duty of the top executive is to deal with
broad organisational matters and major projects, such as long-range planning and the development of organisation's strategy.
Decisions such as expanding a plant, dropping a major product, or purchasing another company are made at this level. Broadly
speaking, they are expected to utilize human and non-human resources to achieve their organisation goals, such as making
profits for owners, paying good wages to employees and produce quality goo& and services with a view to serve customers. In
Short, they must build institutions. According to Prof Pareek (1981), top level executives perform eight key roles while building
institutions of lasting value, as indicated below:

1) Identity creating role: Top level executives must create an identity for their organisations in the market place. Such
an impact can be created by serving employees through excellent welfare measures, developing enviable marketing
 skills or fostering technological innovations. In short, ' they must 'carve out a niche' for themselves in the market
place.

2) Enabling role: Top level executives must develop their resources (men, materials, equipment and other facilities) in
the service of an organisation. A good work atmosphere must be created where employees would feel like
contributing their best to the organisation.

3) Synergizing role: Synergy means that the whole is greater than the sum of the parts. In organisational terms,
synergy means that as separate departments within an organisation cooperate and interact, they become more
productive than if each had acted in isolation. For example, it is more efficient for each department in a small firm to
deal with one financing department than for each department to have a separate financing department of its own.
Top executives must try to combine their human as well as non-human resources in such a way that the goals of the
organisation are met in an effective and efficient manner.

4) Balancing role: The top executive must be able to strike a harmonious balance between conformity and creativity
within the organisation. Conformity to rules and regulations is required to ensure consistent and orderly execution of
work. Conformity when carried out in a rigid and scrupulous manner may affect employee behavior in a negative way
and destroy the creative potential of employees. The chief executive, therefore, must encourage his employees to
move in new directions and respond to new challenges in a dynamic way instead of merely applying rules and
regulations in a mechanical manner.

5) Linkage building role: The chief executive must be able to develop appropriate linkages between the organisation
and outside constituencies such as government, financial institutions, community and society at large. 'Without
enlisting support from those outside constituencies, it might be difficult for the organisation to obtain licenses, to
expand business activity, to carry out research and to initiate rural development programmes.

6) Futuristic role: The chief executive must prepare the organisation for future challenges. To this end, the
organisation must look into market opportunities and encash these in a prudent way. The chief executive must be
able to steer the ship to safery facing the turbulent environmenrs in a bold manner.

7) Creating an impact: This means making an impact of one's organisation on others, by way of superior technology,
marketing skills, innovative abilities, etc.

8) Provide superordination: The chief executive must be able to create a sense of pride and importance in the
subordinates making them feel that they are working in a very important field of work which is very useful for the
society.

How to Become a Successful Manager?

Successful managers wear many hats. They come from a wide variety of backgrounds and possess an
Equally wide variety of traits and skills. To reach the top, there are no short-cuts, but there are at least
Three general pre-conditions for achieving success as a manager (success defined in terms of the
Speed of promotion within an organisation).
Education: Recent surveys of CEOs indicate the growing importance of formal education in preparing managers. Graduate
school degrees and engineering qualifications enjoy a premium value in the job market.

Experience: Experience is also an important factor in learning to be an effective manager Effective managers have typically
held some type of job at college, been in at least one officer position in a campus organisation and worked for two or fewer
companies other than the one they head. In addition, they tend to put in long hours. Communication skills and networking
abilities were found to make a big contribution to managerial success, according to a study conducted by Luthans and his
associates.

Understanding trends: .According to several recent surveys, managerial work in the future is particularly likely to be affected
by growing internationalisation of business, the increasing use of sophisticated information technology to facilitate managerial
work, and the expanding public concern with managerial ethics and values.

How do Managers Learn to Manage?

Thanks to the Honeywell Study (of 3600 managers who were asked to state how they learnt the art of managing), people all
over the globe agree that management is a delicate art and a soft science whose basics can be studied and learnt through job
assignments up to a point (about 50 percent). The remaining part of management knowledge usually comes from relationships,
including boss’s, mentors and co-workers (30 percent) and formal training and education (20 percent). Learning to manage is
indeed like learning to ride a bike. You get on, you fall off and skin your knee, you get on a bit smarter' until you are able to
wobble down the road. Most of what managers learn actually on the job comes from the school of hard knocks'. A study of
British managers identified the following as hard knocks faced by managers while at work:

In order to learn the art of managing, a student requires a strong conceptual foundation, well supported by practical reference,
critical observation of events and the ability to convert both into meaningful actions.

Management is an Art of Getting Things Done

Through People
One unfortunate version of management that has gained wide currently among management thinkers and practitioners is that
management is the art of getting things done through others. On the face of it, the statement seems to be an apt summation of
what a manager does in an organisation. But underneath this apparent simplicity the manipulative character of the
management functions should not go unnoticed. If we were to examine the statement from close qua6ers, three things clearly
Emerge:

Management means getting things done: The determination and accomplishment of goals is a praiseworthy activity of
management. Management, in fact, is a purposeful and goal-oriented activity. Goal-orientation and action-focus provide the
basis for managerial operations. The question of how managers get things done is totally discounted in the formative stages of
Management thinking and development. Imbued with feelings of showing results, managers often skillfully manipulated human
resources in the service of the organisation. Such things as money is a powerful motivator; the average human being has an
inherent dislike of work; the human element must be coerced, controlled and directed in order to get the work done; providing
carrots for successful workers and employing the stick against those falling behind work schedules, etc., permeated
management thinking. These views have been beautifully captured by Douglas McGregor in his theory X. The primary focus of
classical writers was clearly on ends rather than means.
Use authority: Traditional writers Like Fayol viewed authority as the right to give orders and the power to exact obedience
from subordinates. Ends must be achieved through the exercise of authority. The employee must be punished ruthlessly for
turning out poor performance, for not meeting standards, or for going off the Mack Thyhr, in fact, advocated 'differential piece
rate system' to encourage those showing promise and punish those who show lethargy, inefficiency and poor performance.
Severe punishment is meted out even for negligible deviations from standards. Managers used to breathe so closely down the
necks of their subordinates that they made effective action virtually impossible. Rigorous standards, strict controls, severe
punishments, autocratic rules and regulations permeated management thinking and the atmosphere was too suffocating for
subordinates to work effectively toward organisational goals with zeal and enthusiasm.

Results through people: Obtaining results through people presents the toughest challenge to all managers. Inability to
obtain results is one of the principal reasons for managerial incompetence and failure. fu we have seen, in the days gone by,
results were obtained through people by employing carrot and stick policies. Employees were viewed as mere means
(economic tools) to accomplish goals. They were treated as inert instruments in the production process labeled as 'glorified
machine tools'.'The primary job of management is to convert the disorganized resources of men, machines and materials into
an useful enterprise. The focus is on achieving organisational objectives: the individual objectives are completely ignored and
totally discounted. The whole exercise proved to be self-defeating and frustrating for managers because even after injecting
additional doses of incentives, worker performance remains remarkably constant (positive motivation). The use of threats and
punishment (negative motivation) prove to be ineffective after a point. The Hawthorne Studies have clearly showed the
importance of the human element in the production process, and has led to the development of a new management
philosophy. These views have been summed up by McGregor in his theory Y:

Thus, in order to accomplish results, management must create opportunities, remove obstacles, encourage growth and
development of employees and provide guidance and assistance wherever necessary. All this demands skillful application of the
basic principles to the science of management. Managers must have conceptual, technical, administrative and social skills in
translating the abstract organisational philosophy into concrete action. Achieving results implies mobilisation, integration and
judicious employment of resources, human as well as physical and financial, in a disciplined manner. The results obtained must
ultimately be compatible with the demands of the society within which the organisation operates. The statement reveals the
story partially. Goal-accomplishment through people is only part of the story. In addition, management is also concerned with
development of an operating philosophy that ensures the organisation's survival within the social system. Formation and
accomplishment of goals must be within the boundaries prescribed by the society. In order to accomplish this, manager’s must
evaluate the effectiveness of goal- accomplishment and devise methods for achieving those tasks that are compatible with
individual and social objectives. Thus, management is not only an art bur also a science containing definite principle and
concepts governing the activities of the organisation within certain limits. Duncaz has summed up the thinking on these points
thus.

Management Deals with ideas, Things and

People

Management is concerned with ideas, things and people: Management is the dynamic life giving element in every organisation.
It is the activating element that gets things done through people. It provides the dynamic force necessary to transform the
resources of a business organisation into a productive, operating concern. The primary job of management is ro convert the
disorganised resources of men, machines and materials into a useful, productive organisation (Newman). No wonder, people
call management, rather tritely, as the process of marshalling resources, ideas and things to obtain results through people.

Generating ideas: the creative process in management, from the very start of the business, Ideas play a crucial role in
deciding the competitive standing and prospects of the business. It is the working out of new ideas that can keep the business
ever growing in stature and importance. Every organisation gains vitality through new and constructive ideas only. One of the
hallmarks of successful management is the generation of innovative ideas that dramatically change the course of history.
Managers cannot afford to wait for future-they have to make future by their creative abilities (Drucker). They must provide new
ideas, new imaginations and visions to the group working and integrate its efforts in a fruitful manner leading to better
performance. A single idea-decentralisation-introduced and implemented successfully by Alfred Sloan Jr. transformed the
history of General Motors in USA. The idea that steel provides a basic framework for indigenous development of Indian
industries by J.R.D. Tata has ultimately led to the development of steel industry in India. To take another example, the idea that
consumers want a detergent powder that is cheap but has got requisite quality helped the manufacturers of 'Nirma' washing
powder to capture the market and cut down the influence of a multinational firm, Hindustan Lever Ltd. (Surf). It is in the realm
of ideas that management acts as a creative force. Ideas help management in making organisations survive, grow and succeed,
through sheer innovative power. Innovations call for constructive thinking and imaginative solutions to future problems.
Creativity in idea generation spells the difference between success and failure in managing a business. The comparative
efficiency of different management reams lies in their ability to visualize problems before they turn into emergencies (through
creative ideas). Managers can weather out the toughest challenges with the help of ideas. After generating useful ideas,
managers must put the entire organisation machinery in motion for working them out into full-blown plans of action.

Getting things done: managing resources. The primary job of management is to integrate the productive but passive
resources into an useful enterprise. Management of resources implies managing physical, financial and human resources. To
facilitate this process, managers are expected to perform certain basic functions: planning, organising, leading and controlling.
The planning function encompasses, defining the organisation's objectives, establishing a master strategy for achieving these
objectives and developing a comprehensive set of operational plans to integrate and coordinate activities. Organising includes
the determination of what tasks are to be done, who. is to do them, how the deals are to be grouped, who reports to whom,
and where decisions have to be taken. Leading includes motivating subordinates, directing their activities, communicating with
them through effective communication channels and resolving conflicts, etc. Controlling is the process of monitoring
performance by comparing actual results, with predetermined objectives. Thus, in order to get results managers formulate
plans, delineate structural arrangements; hire, train and motivate people and monitor performance by comparing with
previously set goals. The statement that management is concerned with managing 'things' should be qualified in the light of the
above information. Management is actually a process of efficiently getting activities completed through people. Efficiency is a
vital aspect in managing things. Efficiency refers to the relationship between inputs and outputs. If a manager is able
to get more output for a given input, he is said to have achieved things efficiently. Management is also concerned with getting
things completed. In other words, it seeks effectiveness. when managers achieve their goals, they are said to be effective.

Managing people: In the early stages of the evolution of management, managers had completely ignored the importance of
managing people effectively in order to achieve results. People were treated as automatons, machines, economic tools in the
production process, People are things and things can be manipulated to serve the needs of the organisation. as pointed by
Davis, "organisations are systems of medieval torture which suppress and subjugate their victim, the individual. He lives in
helpless conformity, stripped of his self-esteem, in a phony and artificial environment. There is no challenge and no chance for
psychological fulfillment." The appalling results of such callout attitudes have been well documented in management history.
Thanks to the human relations movement (explained in chapter 3), present day managers devote a considerable portion of
their organisational life’s in managing people and communicating with them continually. The individual needs, aspirations and
motives are well recognised, cared for and are integrated into organisational goals. More importantly, human beings are
treated as mature individuals and as creative and innovative persons rather than as passive, lifeless machines.

Management is 'The Art 0f Muddling Through

Situations'
Situations quite often determine managerial actions. Different situations call for different approaches. There is no single (best)
way of solving a problem. Because tasks and people in organisations differ, modern theorists argue that the method of
managing must also differ. The choice of a particular way of managing largely depends on the nature of the job, the people
involved and the situation. Therefore, managers should diagnose the situation thoroughly and adapt to meet the conditions
present.

If a manager wants to increase productivity, the classical theorist (Taylor, Webber, Fayol) may prescribe a new work-
simplification scheme. The behavioral scientist mayo may want the work place to be more stimulating and recommend job
enrichment - the combination of tasks that are different in scope and responsibility and allow the worker greater autonomy in
making decisions. But the manager trained in the contingency or situational approach may ask which method will work best
here? If the workers are unskilled and training opportunity and resources are limited, work simplification would be the best
solution. However, with skilled workers driven by pride in their capabilities, a job-enrichment programme might be more
effective. If the manager wants to motivate knowledge workers to higher performance levels, he has to invariably use a
multivariate approach (a combination of variables interacts to cause a particular outcome): wherein he can use financial and
non-financial rewards to good effect, keeping factors such as the mental make-up of people, organisational resources,
competitive reactions, existing managerial actions, etc., in mind. Depending on situational demands, appropriate managerial
actions, etc., in mind. To be effective, managerial strategies, organisation structure, leadership style, the control points, etc.,
should always be in rune with situational requirements. Instead of focusing attention on 'one best way of doing things',
managers should actively search For opportunities in each situation and devise appropriate action plans.

Summary
Management is the process of working with and through others to achieve organisational objectives in a changing environment.
Managers usually do not directly perform any of the workflow activities. They coordinate, motivate and control the operations
of employees while meeting the day-to-day challenges. To deliver results, they work for painfully long hours, sift through
bundles of data, handle endless meetings, talk to people at various levels, plan proactively, meet the problems head-on and get
ahead of others using their knowledge, skills and experience to good effect. The various roles played by them in this regard are
broadly grouped into three categories: inter-personal roles, informational roles and decisional roles.

Managers perform five basic functions in order to achieve results. Planning is the process of serving enterprise objectives and
deciding the future courses of action. Organising is concerned with the determination of relationships among functions, jobs
and personnel. Staffing is the function of hiring, training and developing suitable persons for the enterprise. Directing tells
people what to do and ensures that they do it to the best of their ability. Controlling keeps the enterprise activities on the right
path and aligned with plans and goals.

The nature of work, of course, at various levels of management may differ in terms of complexity and variety. At the top level,
managers focus attention on overall corporate strategy and policy formation. At the middle level, managers try to convert
corporate strategy into concrete action plans. At the lower level, managers try to implement the plans using resources
judiciously.

To be successful managers should possess three important skills. Human skill is the ability to get along with others smoothly.
Conceptual skill reflects the ability to see the big picture. Technical skill is required to understand how the work is designed,
planned and executed at the plant level. Successful managers now-a-days possess good degrees to their credit. They gain
knowledge and hands-on experience through job rotation. They develop their interpersonal skills by interacting with peers,
subordinates and superiors continually. In order to meet the targets, they use resources, people and facilities to good
advantage. There is no one best way of doing this. The choice of a particular way of managing largely depends on the nature of
the job, the people involved and the situation.

Review Questions
 1. Describe how managerial jobs differ according to hierarchical level. 'What are the implications for managers?

2. Are managerial effectiveness and managerial efficiency related concepts? If so how?

3. According to Katz, what are the three primary types of skills important to management success?

4. Define each of these types of skills.

5. Comment on the following statements:

 Management is getting things done with and through people.

 Management is concerned with ideas, things and people.
 Management is the effective utilization of human and material resources to achieve the Enterprise objectives.

6. Who are managers? What do managers do?

7. Are you at all surprised by the results of The Honeywell study of how managers learn to Manage? 'that can an
individual manager do to meet the challenge to improve productivity?

8. Management is the art of muddling through situations'. Do you agree? Give reasons.

Discussion Questions
1. What are the factors that determine which managerial skills are most important to jobs with which your are familiar?

2. The fundamental functions of management are universal. They are applicable to all situations’. Discuss. ?

3. If managerial work is characterised by variety, fragmentation, and brevity how do managers perform basic
management functions, such as planning which would seem to require reflection and analysis?

4. In order to be effective, a manager must possess and continuously develop several essential skills'. Discuss.

Xxxxxxxxxxxxx
Development of

Management Thought 3
Success in a Bureaucratic
0rganisation
One of the biggest reasons why some people in organisations succeed and others fail is that the former know what their boss
wants them to know whether it is explicitly spelled rut or learned through experience or intuition, successful people know the
things the boss is looking for. Eight of the most common include the following:-

1. Do more than that is expected: your boss expects ever one to do his job. if you do more, however, you will stand out
as a superior performer.

2. Forget about making up excuses: The boss expects you to do things right. When you do not, it may cause problems
but it will do you no good to blame someone eke. Even if you are right, the boss does not want to hear about it. He or
she has more important things to do than trying to assign blame. if your job to get work done right the first time. If
you did not, work harder to do so the next time.

3. Anticipate things going wrong If you do, you until seldom be disappointed. However, you will be prepared to deal
with them before they become too serious. If part of your job calls for getting information from other people and
processing it before passing it on to others, anticipate getting the information late or finding that some of it is
erroneous. All-out yourself time to check the data and get it corrected.

4. Remember that punctuality and attendance count: Do not be late for work or meetings. Even if nothing important
Happens you are expected to be on time. If you are continually tardy or absent, your boss will see this as an attitude
Problem, and it will count against you later on.

5. Get along with your fellow workers: Bosses like to think that everyone in their unit is a team player. If there is internal
dissension, the boss will not want to know who is right or wrong. The boss is not there to referee employee
squabbles. Everyone involved will have a black mark against him. Make it a point to stay On good terms with
everyone in the unit.

6. Be protective of the organisation: Do not say anything that will negatively reflect on the enterprise or anyone who
works there. Keep organisational politics and problems within the enterprise and, if you must do anything that
reflects on another go out of your way to minimize its negative effect.
 7. Learn to read your boss: Listen carefully to that your boss tells you and learn to interpret its meaning. If your boss
says, "this really warrants our looking into, it may mean that you should drop everything you are doing and start
working on the matter he has been talking about. On the other hand, if he says, "this sounds very interesting" it may
mean that the matter is a minor one and should be ignored. Every boss has a specific way of communicating. Figure
out what your boss * really talking about.

8. Never lie: The biggest problem with lying is that it calk your integrity into question. what other lies have you told?
what exactly are you up to? Your boss may be feeling that you are not as reliable as he thought. when this happens,
your credibility comes into question, and your future with the organisation may be affected. If you cannot tell the
truth, Limit what you say so you can stay within this guideline.

Introduction
The art of management has ancient roots. It is as old as civilization. The Egyptian pyramids and the Great 'Wall of China indicate
that large projects requiring managerial skills were undertaken thousands of years ago. More than 200 years ago Adam Smith
described the advantages of division of labour and specialisation. However, the study of management as a science began
recently, especially after the Industrial Revolution. There has been a deluge of research during the last few decades in the field
of management. It has attracted the attention of psychologists, sociologists, anthropologists, mathematicians, political
scientists, economists and so on. Unfortunately, the approaches developed by these scholars have created chaos and resulted
in a 'confused and destructive warfare'. No wonder, Harold Koontz described the present state of management theory as a
‘jungle'. According to Koontz, O'Donnell and, weihrich there are 11 approaches for studying management. 'Way back in 1966,
Stogdill identified nor less than eighteen approaches for studying management. Hutchinson has given the approaches in his
article in the Journal of the Academy of Management in 1971. Thus, different writers have provided different categorisation
schemes for studying management. In order to facilitate easy understanding, we can identify three broad approaches namely,
the classical theory neo-classical theory and modern theory.

Classical Theory

The term 'classical' means something traditionally accepted or long-established. It does not mean that classical views are static
and time bound that must be dispensed with. Some of the elements of classical theory are still with us, in one form or another:

 Inter-related functions: Management consists of several inter-related and inter-dependent functions (planning,
organising, staffing, directing and controlling) which are exercised in a sequential form. This is repeated over and over
again to bring order out of chaos.

 Guiding principles: In order to crystallize the ever – increasing knowledge and thinking in the field, classical writers
have developed certain principles (to aid executive thinking and action) based on practical experience.

 Bureaucratic structure: Traditional theory prescribed that organisation be built around the work to be done. For
maximum efficiency, this theory specified that the work must be logically divided into simple, routine and repetitive
tasks. These tasks should then be grouped according to similar work characteristics and arranged in the form of
departments headed by an executive who has a limited number of subordinates reporting directly to him. Also,
command should Flow from only one individual; everyone should have one and only one boss. 'Work must be
assigned to individuals based on job demands and the individual's ability to do the job. The organisation has 'complex
mechanisms, rules, regulations and procedures. Human action within this framework is explained mechanistically by
the obligations of position in the hierarchy'. The threads of control are held by common superiors working at the top
of the hierarchy. Behavior is regulated by directives, rules and regulations which specify the exact manner in which
the duties are to be performed. The whole structure takes the shape of a pyramid. fu the organisation grows and
develops - operations grow in size; communication becomes complex; more policies, procedures and further
 formalisation is demanded; there would be constant Pressures for greater departmentation; more staff may be
needed to coordinate activities – it would inevitably acquire a bureaucratic, pyramidal structure, as shown below.
 Reward-punishment nexus: "Follow the rules, obey the orders, show the results and get the rewards". More or less,
classical theory emphasized the above philosophy. If you lag behind in the race, you will become a second - class
citizen and not entitled to receive extra benefits. Great emphasis was put on efficient use of resources while
producing results.

Branches of Classical Theory

Surprisingly, the classical theory developed in three streams: Bureaucracy (Weber), Administrative Theory (Fayol), and Scientific
Management

Bureaucracy
Classical organisation, especially as developed by Taylor, which was essentially seen as a development of industrial engineering,
had by 1930 lost most of its elan, largely because it lacked any scientific theoretical case. Max Weber, the German sociologist,
tried to fill this vacuum through his classic work, The Theory of Social and Economic Organisation in 1920.

The word bureaucracy implies an organisation characterized by rules, procedures, impersonal relations, and elaborate
and fairly rigid hierarchy of authority- responsibility relationships. In simple terms, it implies this Proposition The organisation
has a structure. People work within their boundaries. The work is processed with the help of rules and regulations. People
follow these rules while processing work. Persons with proper qualifications are selected so that the work is done efficiently.

ELEMENTS OF BUREAUCRACY

Weber has provided a number of features of bureaucratic structure. These are given below:

1. Hierarchy: Hierarchy is a way of ranking various positions in descending order from top to bottom of an
organisation. In a bureaucratic structure, each lower office is under the supervision and control of higher one.
Ultimately, no office is left uncontrolled in the organisation.

2. Division of work: The total work is divided into specialised jobs. Each person job is broken down into simple,
routine and well-defined tasks. Each employee knows his boundaries. By doing the same type of work a number of
times, he becomes an expert in course of time.

3. Rules, regulations and procedures: The behaviour of employees is regulated through a set of rules. The emphasis
is on consistency. Employees are expected to follow these rules strictly. They have to be applied in an impersonal,
objective manner.

4. Records: Proper records have to be kept for everything. Files have to be maintained to record the decisions and
activities of the organisation on a day-to-day basis for future use.

5. Impersonal relationships: Everything should proceed according to rules. There is no room for personal
involvement, emotions and sentiments. If an employee comes late, whether he is a manager or a peon, the rule must
be same for all. The decisions must be governed by rational considerations rather than personal factors.
 6. Administrative class: Bureaucracies generally have administrative class responsible for coordinating the work.
Known as bureaucrats, these officials are selected on the basis of their competence and skills. They are selected
according to merit, receive special training for their posts, and enjoy corporate tenure. They are paid salary, with
increases according to age and experience, and receive a pension when they retire. Promotion is based on seniority
and achievement, decided by judgments of superiors.

ADVANTAGES

Important advantages of a bureaucratic structure may be listed thus:

1. Specialisation: Bureaucracy offers a valid basis for dividing work. The organisation is divided into different functional
departments. People can specialise in their respective fields and show improved performance.

2. Rationality: "Bureaucracy brings rationality to an organisation. Judgments are made according to an objective and
generally agreed upon criteria. Further, by structuring the duties, responsibilities and reporting relationships in a
command hierarchy, bureaucracy provides form or substance to an organisation. Such logical structuring of activities
brings about orderly execution of assigned tasks".

3. Predictability: The rules, regulations, training, specialization, structure and other elements of bureaucracy enable it
to provide predictability and stability to an organisation. For example, bureaucracy enables a fresh student to predict
with high confidence that his university will still be in existence three years later when he expects to receive a degree
from it. He is also sure about the curriculum he will be required to take and he knows much about the university rules
and regulations that will govern his behaviour.

4. Democracy: In bureaucratic organisations, decisions are arrived at according to an acceptable criteria. Rules and
regulations bring about consistent behaviour within the organisation. Activities are taken up on a priority basis,
according to a time schedule. People are selected on the basis of merit. Patronage, favouritism and other arbitrary
bases are not given weightage. Because the opportunity to train, apply and be selected for a job is open to every
citizen, a significant degree of democracy is achieved.

DISADVANTAGES

On the negative side, bureaucracy is criticised on the following grounds:

1. Rigidity: Critics of bureaucracy claim that it is rigid, static and inflexible. Strict adherence to rules produces timidity,
conservatism and technicism. In the name of following rules, people may even shirk away from their responsibilities.

2. Impersonality: Bureaucracy emphasises mechanical way of doing things. Rules and regulations are glorified in place
of employee needs and emotions. That is why, bureaucracy is labeled an organisation without persons'. ",

3. Displacement of objectives: As organisational procedures become more formalised and individuals more
specialised, means often become confused with ends. Specialists, for example, may concentrate on their own finely
tuned goals and forget that their goals are a means for reaching the broader objectives of the organisation.

4. Compartmentalization of activities: Strict categorisation of work restricts people from performing tasks that they
are capable of doing. For example, a pipe fitter can install a pump, but is prohibited by work rules from making the
electrical connection even if he is totally qualified to do so. Bureaucracy would also encourage a tendency to
perpetuate existing jobs even when they become redundant. The rypica1 bureaucracy tries to preserve all the old
jobs and add new ones for new requirements, resulting in wastage of scarce inputs.

5. Empire-building: Bureaucracies often turn managers into empire builders. They try ro enhance their status and
power by adding more people, more space, more physical facilities -whether 'they are required or not. As pointed out
by Weber, once it is fully established, it is hard to destroy bureaucracy even if it has outlived its usefulness.
 6. Red tape: Bureaucracies are paper mills. Everything is recorded on paper. Files move through endless official
channels, resulting in inordinate delays. Communication is reduced to a feeble walk and members while trying to
adhere to rules may discount the value of arriving at prompt decisions. By encouraging conformity to rules and
regulations, bureaucracies leave nothing for original and innovative behavior.

These troubling criticisms compelled many a writer to dismiss bureaucracy as a hopelessly outdated and unwanted creature in
the present day world. 'Writers have also Labeled it as a 'continental nuisance', a structural dinosaur', 'an impersonal monster'.
It is said to be an organised. system for not getting things done effectively. Bureaucrats are experts in wasting time, money and
energy and are called ' hopeless company men'. Despite these negative pronouncement bureaucracy remains an essential
feature of modern civilisation. Business organisations, schools, government "., and other organisations, largely, are based on
bureaucratic concepts even today. There is no use wishing it away' Many of the problems of bureaucracies could be avoided if
the individual needs and characteristics of every organisational member are remembered and considered in making managerial
decisions.

Scientific Management

WHY TAYLOR IS ACCEPTED AS THE FATHER OF SCIENTIFIC

MANAGEMENT?

Scientific management arose, in part, from the need to increase productivity. In the United States, especially, skilled labour was
in short- supply at the beginning of twentieth century, To expand productivity ways had to be found to increase the efficiency
of workers. Could some portions of the work be eliminated or some parts of the operations combined? Could the
Sequence of these tasks be improved? 'was there 'one best way' of doing a job? In his pursuit of answers to such questions,
Frederich W Taylor slowly built the body of principles that constitute the essence of Scientific Management (1890-1930) . Taylor
did most of his work at the Midvale and Bethlehem Steel Companies in Pennsylvania. His early years at Midvale were
particularly disgusting. He was constantly appalled at the inefficiency of workers. Employees used vastly different techniques to
do the same job. They were prone to 'taking it easy' on the job. Taylor firmly believed that worker did only about one - third of
what was possible. There were no effective work standards. workers had no incentive to produce more because they were paid
an hourly rate. workers were afraid to work fast because they believed their rate of pay would be lowered or they would be laid
off if they completed their tasks too quickly. 'Workers were asked to take up jobs unrelated to their abilities and aptitudes.
Management decided things based on hunch and intuition. Most importantly, management and workers viewed themselves to
be in continual conflict.

TAYLOR'S MEDICINE
Taylor set out to correct the situation by employing the scientific method to workers on the shop floor. He emphasised that
work would not be taken for granted but should be taken seriously. Productivity is not harder work, but smarter work, that is an
understanding and systematic analysis of work. Much of Taylor's published work was based on his report on work improvement
rests performed at Bethlehem Steel – emphasizing 'one best way' philosophy. Taylor reported that the company had about
seventy-five men employed to load pig iron freight cars. He selected a Pennsylvania Dutchman named Schmidt (real name
Henry Nolle) and offered him an increase in pay from $ 1.15 per day to $ 1.85 per day if he would follow his orders with no back
talk. Taylor projected that following orders would increase Schmidt's productivity from about 12 tons a day to more than 47
tons. Schmidt agreed to the proposal. Consequently, on some days he would keep his legs straight and use his back to lift with.
Taylor experimented with rest periods, walking speed, carrying positions, and other variables. After a long period of
scientifically trying various combinations of procedures, techniques and tools, Taylor succeeded in finding out 'one best way' to
perform the task and realized the goals set by him. Taylor claimed to have trained the other workers until the entire crew had
raised their productivity in this manner.

Thus, by putting the right person on the job with correct tools and equipment, by having the workers follow Taylor instructions
exactly, and by motivating workers through the economic incentives of a significantly higher daily wage, Taylor achieved
significant improvements in productivity. Taylor explained these ideas and techniques in his two books ( Shop Management and
The Principles of Scientific Management) and these ideas found favour in USA, France, Germany, Russia and Japan, in course of
time.
BASICS OF SCIENTIFIC MANAGEMENT
The concept of scientific management implies the application of science to management. It is based on 4 basic principles:

1. Each task must be scientifically designed so that it can replace the old, rule-of-thumb methods.

2. Workers must be scientifically selected and trained so that they can be more productive on their jobs.

3. Bring the scientifically designed jobs and workers together so that there will be a match between them.

4. There must be division of labour and cooperation between management and workers.

Taylor stressed the importance of employee welfare as well as production efficiency. Tb boost up productivity, wage incentives
based on performance (differential piece rare system) were introduced. The emphasis was on maximum output with minimum
effort through elimination of waste and inefficiency at the shop floor level.

Taylor summed up his approach in these words (principles):

i. Science, not rule of thumb.

ii. Harmony, not discord.

iii. Cooperation, not individualism.

iv. Maximum output in place of restricted output.

v. Development of each man to his greatest efficiency and prosperity.

vi. Equitable division of work and responsibility between management and labour.

KEY CONCEPTS

Scientific task planning: Scientific task is the amount of work which an average worker can Perform during a day under normal
working conditions (called as a fair dayt work). Management should decide in advance as to what work is to be done, how,
when, where and by whom' The ultimate goal is to see that work is done in a logical sequence promoting maximum efficiency.

1. Time and motion studies: Time and motion studies have been advocated 6y Taylor with a view to isolate the
wasteful and unproductive motions on the job. The time study would indicate the minimum time required to do a
given job. The time taken by workers to do a job is being recorded first and this information is being used to develop a
time standard. Time standards is
2. The period of time that an average worker should take to do a job. Motion study is carried out to find out the best
sequence of motions to do a job. The aim is to eliminate unnecessary, ill-directed and wasteful motions and find out
the one best way of doing a job. In this study, finger movements, hand movements, arm movements and shoulder
movements are being studied, through photographic evidence. In addition, fatigue studies are also carried out to find
out the extent of boredom and monotony caused by a job. Taylor and his colleagues (Gilbreths, Gantr) advocated
fatigue studies so as to find out the best synchronization between time, work and rest pauses needed to do a piece of
work. Managers, in the end, are charged with the task of planning the work through the above studies and workers
are expected to implement the same.

3. Standardizations: Under scientific management, standards have to be set in advance for the task, materials, work
methods, quality time and cost, working conditions, etc. This helps in simplising the process of production, reducing
wasteful use of resources, improving quality of work etc.
 4. Differential piece rate system : In order to motivate workers, wage incentives were developed in most scientific
management programmes. Taylor advocated differential piece rate system based on actual performance of the
worker. In this scheme, a worker who completes the normal work gets wages at higher rate per piece than a worker
who fails to complete the same within the time limit set by management. For example, each worker who produced l0
machine nuts (normal work) would be paid the standard wage of Rs 2 per piece, and those below the normal work
may get Rs 1.5 per piece. Thus, there is considerable difference in wages between those who complete the job and
those who do not complete. Each worker is pitted against every other worker in an unhealthy' competitive scheme to
make more and earn more. In the long-run, this will have a telling effect on the health of the worker. More
damagingly, this scheme would divide the working class permanently. Though the differential piece rate system is
opposed by unions and workers alike, the essential merit in Taylor's suggestion that wages must have a linkage with
performance of employees should not be discounted altogether.

5. Functional foremanship: In order to achieve better production control, Taylor advocated functional foremanship
where the factory is divided into several components, each in charge of a specialist, namely', route clerk, instruction
card clerk, cost and time clerk, gang boss, speed boss, inspector, repair boss and shop disciplinarian. These functional
specialists perform the planning function and provide expert advice to workers. They plan the work for employees
and help employees in improving results. The workers are expected to implement the commands of functional
specialists. The idea of a divorce between planning and doing function, unfortunately, suggests that workers are
incapable of thinking independently. Drucher dubbed this principle as an undemocratic one because it overshadows
the independence and initiative of workers completely.

CONTRIBUTIONS

According to Gilbreths, the primary benefit of scientific management was 'conservation and saving, making an adequate use of
€very ounce of energy of any type that is expected'. In the modern assembly line, conveyer belts bring to each employee the
parts needed to perform one specific job and they carry the completed work to the next employee on the line. Specialisation
and division of Labor have brought about the second Industrial Revolution in America and other developing nations. The
American production 'miracle' is said to be the legacy of scientific management. The time and motion techniques have shown
clearly as to how to organize the tasks in a more eFficient and rational way. The role of scientific selection and development of
workers in increasing worker effectiveness is also recognised. The stress it placed on work design encouraged managers to
pursue the ‘one best way' philosophy and achieve the tasks with the minimum effort and cost. Scientific management not only
developed a rational approach to solving organisational problems but also pointed the way to the professionalisation of
management.

LIMITATIONS

Scientific management was criticised on several grounds:

i. Exploitative device: Scientific management had two objectives: increasing workers' productivity and improving
workers' economic welfare. Scientific management helped in realising the first objective. The second objective
was never realized because management did not share the benefits of increased productivity with workers.

ii. Depersonalized work: Scientific management supplied standardized jobs to workers. Everything was set in a
straitjacket. -Workers were made to repeat the same operations daily. This produced boredom and monotony.
'Workers did not like the idea of becoming glorified machine tools.

iii. Unpsychological: Scientific management was dubbed 'unpsychological' because there is no accurate
information as to how the wages are to be given, how the worker's efficiency is to be measured and so on.
Taylor's choice of terminology was also poor. The idea that maximum productivity could be achieved only by
employing 'first class men' was equally deplorable.
 iv. Undemocratic: Drucher questioned the idea of managers planning the operations and workers implementing
the same. In other terms, one group always performed challenging, novel tasks whereas the other one is loaded
with boring, routine and standardised jobs. Scientific management is; thus, undemocratic because it
overshadows workers' independence. It treats workers as unthinking animals.

v. Anti-social: Scientific management is regarded anti-social because workers are treated as glorified economic
tools only. They are permitted to participate in matters affecting their lives. According to Dr. C.S. Myers it is anti-
social because it aims at excluding the average workman from the field of work as far as possible.

vi. Unoriginal: People like Hoagland questioned the originality of Taylor ideas and felt that his contribution had
been somewhat overrated and overemphasised. Later research into Bethlehem Steel’s records, Taylori published
and unpublished revisions of his own work, and other sources indicated that Taylori report on Bethlehem Steel
was almost completely a lie.

vii. Unrealistic: Thylor 5elieved that employees are motivated by material benefits. He therefore, concentrated on
physical and financial needs, completely ignoring the social and ego needs of people. As current research
indicates, employees do not work for money alone. They seek job satisfaction, growth opportunities, challenging
work, recognition etc apart from economic incentives from work

Despite these limitations, Thylor is still regarded as a heroic figure in the history of management because of certain genuine
reasons: (i) He is the first one to advocate planning of work, scientific selection of people, putting right man on the job,
rewarding the efforts of employee in adequate measure, waging a war again.st inefficiency etc. (ii) He gave a concrete shape to
his ideas and reduced managerial thinking to a set of principles that have stood the test of time over the years.

Administrative Theory

 HENRY FAYOL (1841-1925)

About the time when E W Taylor was developing the principles of scientific management in the United States, Henry Fayol was
revolutionising managerial thinking in France. Trained as a mining engineer, Fayol made his mark as an industrialist with the
French coal and iron combine of Commentary-Fourchambault, where he spent his entire working career. He joined the firm as a
junior executive in 1860 and rose quickly through the ranks, retiring as a director of the company in 1918. When the company
had been near bankruptcy in 1888, he had taken it over and transformed it into a financially strong organisation. Based on his
own experiences as CEO, Fa1.ol developed the administrative theory, which explained the process of managing an organisation
from the top managerial perspective. Most writers acknowledge Fayol as founder of the classical management school, nor
because he was the first to investigate managerial behaviour but because he was the first to systematize it. Fayol believed that
sound managerial practise falls into certain patterns that can be identified and analysed, He believed that management can be
taught, once its basic principles were understood and a general theory of management was formulated.

 FAYOL’S SIX

In setting out to develop a science of management, Fayol began by classifying business operations into six major activities;
technical (production) ; commercial (buying and selling); financial (use of capital); security (protection of property); accounting
(keeping financial records); and managerial. Since the first five activities were commonly understood by many practitioners at
that time, Fayol devoted his attention to the last activity.

MANAGEMENT FUNCTIONS

At the managerial level, Fayol argued that managers should perform five functions:

1. Planning: Devising a course of action that will help the organisation meet its objectives.

2. Organising: Mobilizing the material and human resources of the organisations to put the plan into effect.

3. Commanding: Giving directions to employees so that they perform the needed tasks.

4. Coordination: Making sure that the resources and activities of the organisation are working harmoniously ro achieve
the desired goals.

5. Controlling: Monitoring the plans to ensure that they are being carried out properly.

This conception of managing has had, and continues today to have, a decisive impact on managerial thought, education and
practice. Many business organisations even today find the functional view of managing useful for purposes of in-house
managerial training and development.

PRINCIPLES OF MANAGEMENT
At the operational level, Fayol asserted that managers should apply fourteen principles. According to him, these principles can
be applied in all types, functions, levels and sizes of organizations. This had earned him the title of universalist. These are given
below:

1. Division of work: This is the principle of specialisation which applies to all kinds of work. The more people
specialise, the more efficiently they can perform their work. Specialisation increases output by making employees
more efficient.

2. Authority and responsibility: Authority is the right to give orders and the power to obtain obedience. A manager
might use both his official authority and personal authority while getting things done. Official authority is derived
from the managers position and personal authority is derived from personal qualities such as intelligence, experience,
past services, etc. Responsibility arises out of assignment of an activity. An individual to whom authority is given to
exercise Power must also be prepared to bear responsibility to perform the work in a satisfactory manner.

3. Discipline: Employees must obey and respect the rules that govern the enterprise. Good discipline is the result of
effective leadership, a clear understanding between management and workers regarding the organization rules and
the judicious use of penalties for violation of the rules.

4. Unity of command: An employee should receive commands from only one superior. Dual command, as advocated
by Taylor in his principle of functional foremanship where a worker receives orders from a number of functional
specialists, undermines authority and puts discipline in jeopardy'. Fayol believed that when an employee reported to
more than one superior, conflict in instructions and confusion of authority would result.

5. Unity of direction: This principle calls for 'one manager one plan' for all operation’s having the same objective. For
example, the personnel department in a bank should nor have two directions, each with a different recruitment
policy. The unity of direction principle, when applied properly, ensures unity of action and facilities coordination.
 6. Subordination of individual interest to the common good : In any organisation, the interests of employees
should not take precedence over the interests of the organisation as a whole. This can be achieved when managers
set an example through their good conduct and behaviour. They must be honest and fair in dealing with internal
groups. They must be prepared to sacrifice their personal interests whenever such interests are in conflict with
organizational interests,

7. Remuneration of personnel: Compensation for work done should be fair to both employees and employer s. Fayol
did not favor profit-sharing plan for workers but advocated it for managers.

8. Order: Materials and people should be in the right place at the right time. People in particular, should be in the jobs
most suited for them. The general principle in this respect should be 'a place for everything and everything in its
place' and 'a place for everyone and everyone in his place.'

9. Centralisation: Decreasing the role of subordinates in decision-making is centralization; increasing their role is
decentralisation. Whether decision making is centralised (to management) or decentralised (to subordinates) is a
matter of proper proportion. Fayol say that managers should retain final responsibiliry but also need to give their
subordinates enough authority to do their jobs properly.

10. Scalar chain: The graded chain of authority from top to bottom through which all communications flow is termed as
'scalar chain'. However, if following the chain creates communication delays, cross- communication (gangplank
principle) can be permitted, if agreed to by all parties and superiors are kept informed.

11. Equity: managers should be Fair in dealing with employees. Equity is the combination of justice and kindness. The
application of equity requires good sense, experience, and good nature for soliciting loyalty and devotion from
subordinates.

12. Stability of tenure: Stability of tenure is essential because time is required for an employee to get used to new work
and succeed in doing it well. Management must, therefore, implement Practises which encourage long-term
commitment of employees. Instability of tenure can significantly affect the fortunes of a company.

13. Initiative: Employees must be encouraged to think through to implement a plan of action, even though some
mistakes may result. The opportunity to perform independently is an essential component of employee growth and
development.

14. Esprit de corps: This principle states that 'union is strength'. Promoting team spirit will give the organisation a sense
of unity. To Fayol, even small factors could help to develop this spirit. He suggested, For example, the use of verbal
communication in place of formal, written communication wherever possible.

UNIVERSALITY OF MANAGEMENT PRINCIPLES

Since management is universal among all organisations, Fayol argued that those who acquire a general knowledge of
managerial functions and principles can manage all types of organizations. He argued that anyone interested in managing an
enterprise could learn these principles and apply successfully. In order to become a manager however, certain qualities of head
and heart are needed (physical health, mental vigor, character, etc).
MANAGERIAL SKILLS
Fayol emphasised the need for managers to acquire certain unique skills in order to do their work
properly. He listed the following qualities of a manager:

 Physical (health and vigour).

 Mental (ability to understand, learn; apply judgment and adapt to different situations).

 Moral (energy, initiative, firmness, loyalty tact and dignity).

 Educational (acquaintance with matters not related to the function performed).

 Technical (specialised knowledge relating to one's area' of specialisation, especially .about

 machines, work processes, etc).

 Experience (relating to the work carried out).

According to Fayol, there is nothing mystical about managerial skills and knowledge. This can be Acquired through formal study
and training.

CONTRIBUTIONS OF FAYOL

Fayol contribution to management is unique and valuable. He provided a conceptual framework for analysing the management
process. He (i) proposed that all operations in a business can be classified into 6 major heads where management is the most
important one; (ii) listed planning, organising, commanding, coordinating and controlling as the main elements of management;
and (iii) proposed l4 principles of management which could be applied universally. A number of current ideas and practices in
management can be directly linked to the contributions of Fayol. Till recently, many management textbooks were written along
the guidelines provided by Fayol. By emphasising the management skills are universal, Fayol has done a signal service to the
propagation of management concepts. Fayol always believed that managerial ability could be applied to the home, the church,
the military, the school, politics as well as to industry. This has ultimately led to the mushrooming growth of management
institutions throughout the globe

LIMITATIONS
Administrative theory (as propagated by Fayol, Mooney and Reiley, Urwick and Barnard), is criticised
On the following grounds:

 Lack of empirical evidence: The theory is not supported by empirical evidence. Some of the terms and concepts have
not been properly explained by Fayol. For example, the principle of specialisation does not tell us the way to divide
the tasks. The so called principles of management have been dubbed by critics (Simon, Stephenson) as proverbs'
comparable to folklore and folk wisdom.

 Neglect of human factor: The theory views human being as passive and capable of reacting only to organisational
rules and economic incentives. Human attributes such as emotion, attitude, creativity have been totally ignored.

 False assumptions: The theory assumes that all organisations can be managed by the same set of rules and principles.
It does not recognise the differences in tasks and problems that confront organisations. Formal authority, again, is not
sufficient for managers to control employees. They must act differently in different situations, assessing their own
 strengths, organizational needs, union pressures, competitive reactions etc from time to time. Rules have to be
applied carefully looking at the internal and external dynamics of the organisations.

 Pro-management bias: It suffers from pro-management bias. It is more concerned with what mangers should know
and do rather than with a more general understanding of managerial behavior. It does not offer guidelines as to
when, where and how the principles have to be applied.

 Historical significance: It has only historical significance. It is more appropriate for the past (where the environment
was stable, predictable) than for the present (where the environment is turbulent, competitive and continually
changing). As we all know, getting work from subordinates through the use of commands, instructions and force is
not possible in the modern world.

Taylor vs. Fayol

Henry Fayol is known as the father of modern management theory. This title recognises his pioneering efforts in systematising
the management principles. Scientific management was concerned with increasing the productivity of shop and individual
worker. It was a philosophy concerning the relationship between people and work. The activities of management received little
attention. As more and more people were entering the management ranks following increased business activity, the study of
management began to receive attention. Questions like what management is, what organisational principles are, and the
methods by which managers could more effectively perform their jobs have been advanced frequently. Henry Fayol answered
these questions. From his practical experience as the managing director of a large French coal mining firm, he has developed a
blue print for a cohesive doctrine of management - one which retains much of its force to this day. He originated the symbol of
formal organisation, the organisation chart, which, with his organisational manual of job descriptions, remains the chief
instrument of business management. He produced ideas on human relationships.'Not the least, he was a firm advocate of the
view that management can and should be taught. This was a revolutionary idea when he first pronounced it in 1908.

Fayol was a contemporary of Taylor. But unlike Taylor, Fayol concentrated on the activities of all Managers and produced a
book from out of his personal experiences. The works of Taylor and, Fayol, however, are essentially complementary, namely:

 Both believed that proper management of personnel and other resources was a key to organizational success.

 Both applied scientific methods to the problems of management.

 Both had the experience of industry and developed their ideas through practical training and experience.

The major difference in their approaches centered around their orientation. Taylor was a scientist came through the ranks and
concentrated on the operative level. Fayol was a practitioner. He spent most of his time in executive positions and had more of
a top management perspective. Taylor paid, more attention to the technical side of work (job design, standardisation of
procedures, proper placement of people, proper training, etc.) to improve efficiency of work. Fayol placed more emphasis on
the administrative side of work. He laid more emphasis on rhe functions and principles of management in general.

Critique of Classical Theory

The principles around which classical on various grounds. These have been summarized in table no. 3.2

Neo-Classical Theory
In the 1920s and 1930s, observers of business management began to feel the incompleteness and shortsightedness in the
scientific as well as administrative management movements. The scientific management movement analysed the activities of
workers whereas administrative management writers focused attention on the activities of managers. The importance of the
man behind the machine, the importance of individual as well as group relationships in the workplace was never recognised.
The social aspects of a worker's job were totally ignored; the emphasis was clearly on discipline and control rather than morale.
The human relations theory (also called neoclassical theory) tried to compensate for the deficiencies in classical theory
(scientific management and administrative management) modifying it with insights from behavioural sciences like psychology,
sociology and anthropology. This theory gained popularity after the famous studies of human behavior in work situations
conducted at the western Electric Company from 1924 to 1933. These studies eventually became known as the 'Hawthorne
Studies' because many of them were conducted at western Electric Hawthorne plant near Chicago.

HAWTHORNE EXPERIMENTS
The Hawthorne researchers began with illumination experiments with various groups of workers. This experiment involved
prolonged observation of two groups of employees making telephone relays. The purpose was to determine the effects of
different levels of illumination on workers' productivity. The intensity of light under which one group was systematically varied
(test group) while the light was held constant (control group) for the second group. The productivity of the test group increased
each time the intensity of the light increased however productivity also increased in control room which received no light the
researcher felt that something beside lighting was influencing worker performance

In a new set of experiments, a small group of workers were placed in a separate room and a number of things were changed;
wages were increased, rest periods of varying length were introduced. The workday and workweek were shortened. The
researchers, who now acted as friendly supervisors, allowed the group to choose their own rest periods and to have a say in
other suggested changes. 'Workers in the test room were offered financial incentives for increased production. Over the two
year period, output went up ‘in both the test and control rooms (surprisingly, since the control group was kept on the same
payment schedule) steadily regardless of changes in working conditions. why?

Hawthorne Effect
Part of the answer may be attributed to what has come to be called the 'Hawthorne Effect’. the workers knew they were part of
an experiment. They were being given special attention and treatment because of the experiment. They were consulted about
work changes and were not subject to the usual restrictions imposed from above. The result of this special attention and
recognition caused them to carry a stimulating feeling of group pride and belongingness. Also, the sympathetic supervision
received by the members might have brought about improved attitudes toward their jobs and job performance. At this stage,
the researchers were interested in finding out clear answers to the question: 'Why the attitudes of the employees had become
better after participation in the test room?

 INTERVIEWING PROGRAMME

Mayo initiated a three year long interview programme in 1928 covering more than 21,000 employees to find out the reasons
for increased productivity. Employees were allowed to talk freely (non-directive interviewing) and air their opinions in a friendly
atmosphere. The point demonstrated by this interviewing programme is central to the human relations movement. If people
are permitted to talk about things that are important to them, they may come up with issues that are at first sight unconnected
with their work. These issues may be, how their children are doing at school, how the family is going to meet the ration
expenses, what their friends think of their jobs, and so on. talking about such matters to a sympathetic listener who does nor
interpret is therapeutic. when researchers began to examine the complaints made by the employees they found most of
complaints to be baseless. Many times nothing was done about the complaint, yet, after an interview the complaint was not
made once again. It became apparent that often workers really did nor want changes made; they mainly wanted to talk to an
understanding person who did not criticise or advise about their troubles. Thus, for the first time, the importance of informal
work groups is recognised. To find out more about how the informal groups operated, the bank wiring room experiment was
set up.
  Bank Wiring Room Experiment
In this experiment, 14 male workers were formed into a small work group and intensively observed for seven months in the
bank wiring room. The men were engaged in the assembly of terminal banks for the use in telephone exchanges. The
employees in the group were paid in the regular way depending on ,the efficiency rating plus a bonus based on average group
effort. Thus, under this system, an individual pay was affected by the output of the entire group and by his own individual
output. It was expected that highly efficient workers would bring pressure to bear on less efficient workers in an attempt to
increase output and thus take advantage of the group incentive plan. However, these expected results did not come about. The
researchers found that the group had established its own standard of output and this was enforced by various methods of
social pressure. Output was not only being restricted but individual workers were giving erroneous reports. The group was
operating well below its capability and was leveling output in order to protect itself. Thus, work group norms, beliefs,
sentiments had a greater impact in influencing individual behaviour than did the economic incentives offered by management.

HUMAN RELATIONS: KEY CONCEPTS

The Hawthorne experiments, thus, indicated that employees were not only economic beings, but social and psychological
beings as well. The man at work is motivated by more than the satisfaction of economic needs. The main emphasis should be
on creating a humanistic or informal organisation in place of a mechanistic or formal organisation. The organisation must be
democratized and people working therein must become part of 'one big happy family'. In the words of Keith Davis, "Human
relations is motivating people in organisations in order to develop teamwork which effectively fulfils their needs and achieves
organisational goals." The whole philosophy of human relations is built around the following ideas:

1. The individual: According to human relationists, each person is unique. Each is bringing to the job situation certain
attitudes, beliefs and ways of life as well as certain skills-technical, social and logical. Hence, the individual is not only
motivated by economic factors, but is motivated by multifarious social and psychological factors.

2. The work group: Work is a social experience and most workers find satisfaction in membership social groups. Unless
managers recognise this, human relations at work will not improve. Good interpersonal and intergroup relationships
among people need to be maintained to obtain productivity gains.

3. The work environment: Managers have to create positive work environment where the employee finds it easy to
achieve organisational goals as well as his own personal goals. Positive work environments are those where: (i) the
goals are clearly defined, (ii) incentives are properly used to improve performance, (iii) decisions are timely and
participative, (iv) conflict is confronted openly and squarely, and (v) the work is interesting and growth-oriented.

4. The leader: The leader must behave in a way that generates respect. He must be able to adjust to various
personalities and situations. He must offer a pleasant work climate where bossism is totally absent and where
members are allowed to have a say in the decision-making process.

PARTICIPATIVE CLIMATE

Participative management or decision-making in which workers discuss with supervisors and influence decisions that affect
them - is a major aspect of human relations theory. As Mayo observed, "Before every change of programme, the group is
consulted (Illumination Experiments). Their comments are listened to and discussed sometimes 'their objections are allowed to
negate a suggestion. The group unquestionably develops a sense of participation." Researchers interpreted that participation
results in higher productivity: "the girls have ceased to regard the man-in-charge as a boss........ they have a feeling that their
increased production is in some way related to the distinctly freer, happier, and more pleasant work environment." The
experiment showed that a supervisor can contribute significantly in increasing productivity by providing a free, happy and
pleasant work environment where bossism to totally absent and where members are allowed ,to participate in decision-
making policies. Authoritarian tendencies must give way to democratic values. Instruction and coaching must replace
browbeating and diving.

REFINEMENTS IN NEO-CLASSICAL THEORY

The neo-classical theory attempted creation of workforce with high morale by using democratic means. The focus was on
people, incentives, democratisation of workplace, and social interactions in direct contrast to what the classical theory
emphasised i.e. order, rationality structure, rules and regulations, specialisation, economic tools etc. Lets look into these
differences more closely in table 3.5 and 3.6.

CRITICISMS

The Hawthorne studies and the human relations school they spawned have been severely criticized, and-our discussion would
be incomplete without a brief discussion of these criticisms.

1. Philosophy: Several economists claimed that by encouraging workers to develop loyalties to anything but their own
self-interests, and by preaching collaboration instead of competition, human relations would ultimately lead to
reduced efficiency. No wonder trade unions ridiculed it as a form of 'coat psychology', which transformed factories
into unthinking places of ‘comfort. Interest in human relations is equated with tender-mindedness, sentimentality
and unrealistic desire to make everyone happy. Critics also charged that the human-relations movement, built as ir is
on a philosophy of worker-management harmony, is not only antithetical to a viable capitalistic system but
impractical as well.

2. Scientific validity: The research carried out by Mayo and his associates had many weaknesses of design, analysis,
and interpretation. Whether the researchers' conclusions are consistent with their data is still a subject of lively
debate and considerable confusion. with respect to the relay assembly test room studies, for example, Carey pointed
our that there was no attempt to establish sample groups representative of any larger population than the groups
themselves, and that no generalization is therefore legitimate'.

3. Short-sighted: The very fact that the human relations research is concerned with operative employees bears ample
testimony to the short-sightedness of the research findings. Further, the approach lacks adequate focus on work. It
tends to overemphasise the psychological aspects at the cost of structural and technical aspects. It tends to neglect
the economic dimensions of work satisfaction. But as we all know, economic motivation is exceedingly strong and
quite often, economic explanations are appropriate for understanding human behaviour. It is small wonder; it is
labeled as a short-sighted ventilation therapy.

4. Over concern with happiness: The Hawthorne studies suggested that happy employees will be productive
employees. This, of course, is a native and simplistic version of the nature of man. Studies have failed to show a
consistent relationship between happiness and productivity. It is quite possible to have a lot of happy but
unproductive employees.

5. Anti-individualist: The human relations movement is anti-individualist. Here the discipline of the boss is simply
replaced by the discipline of the group forcing the individual to sacrifice his personal identity and dignity. The
individual may not find his true self and gain a stimulating feeling of personal freedom by completely losing himself in
a group. Further, there is no guarantee that groups will always be instrumental in delivering satisfaction to members.

CONTRIBUTIONS
Criticisms like these are not without merit, and it is probably true that the Hawthorne researchers and their critics overstated
their case. Yet, it would be a mistake to disregard the Hawthorne findings as scientifically worthless. By stressing social needs,
the human relationists improved on the classical theory, which treated productivity almost exclusively as an engineering
problem. They introduced the idea of the organisation as an open system in which the technical and human elements are
closely interrelated. They emphasised the importance of employee attitudes in an era when wage incentives and physical work
conditions were often viewed as the only requirements for high productivity. They spotlighted the importance of a manager's
style and thereby revolutionized management training. More and more attention was focused on teaching people management
skills as opposed to technical skills. Their work led to a new interest in the dynamics of groups. Managers began thinking in
terms of group Processes and group rewards to supplement their former concentration on the individual worker.

Much of the aforesaid criticisms can be effectively countered by emphasizing the fact that man is a social being. Human
relations philosophy as such is not the culprit. A humanistic approach to organisational problems does not imply total negation
of performance requirements of work place. It is the use and practise to which it is put that accounts for most of its serious
limitations. From a Practical point of view, it really is of little importance whether the studies were academically sound or their
conclusions justified. What is more important is that they were significant in stimulating an interest in human factors. As
luanchvich pointed cut, "if it did nothing else, it stimulated an interest in the human problems of necessary impetus for the
present management theory." management and thereby provided the day behavioral sciences emphasis in management theory

Behavioral Sciences Approach

The behavioural sciences approach developed as a narural evolution from the Hawthorne experiments. The Hawthorne
researchers (Elton Mayo and his Harvard colleagues) stressed the importance of emotional elements such as feelings and
sentiments to explain human behaviour and performance in organisations. The behavioural approach applies the knowledge of
the behavioural sciences-psychology, sociology and anthropology-to managing people. 'We have seen that the human
relationists believed that people are social beings who are motivated by social interactions and that their job performance will
increase when the job gives them opportunities to socialize. Behavioural scientists felt this to be an oversimplified model of
human motivation and began to undertake serious investigations.

KEY IDEAS

A number of behavioural scientists have contributed to the development of the approach- Among the front-runners was
Abraham Maslow, who developed a hierarchy of human needs which became the basis for explaining work motivation in
organisations. According to Maslota, people generally have five basic needs (physiological, safety social, self-esteem and self-
actualisation) and they satisfy these needs in their order of importance. For most people in our society the lower-order needs
(physiological, safety and social needs) are reasonably well satisfied. Therefore, they seek to satisfy socialization needs by
interacting with friends. Once these needs are reasonably met, they seek to satisfy, higher-order needs, such as self-esteem and
self-actualisation, by using their energies, talents and resources productively. Behavioural scientists believed that people will be
productive if they are given opportunities to use their abilities and creative skills. Building on Maslow theory of human needs,
many behavioural scientists (Chris Argyris, Douglas McGregor, Rensis Likert) argued that existing jobs and managerial Practises
should be redesigned and restructured to give employees an opportunity to satisfy' their higher-order needs. Although working
independently, they proposed a common theme: People are basically good, and, in order to stimulate their performance,
management should humanize work. People must be treated as assets (hence the name, human resources approach). They
argued, for instance, for increased participation by employees in those decisions that affected them; demonstration by
management of greater trust and confidence in people; increased emphasis to be given to integrating individual and
organisational goals, and allowing employees to self-monitor their own activities in place of external control measures. These
behavioural writers argued for a strong humanist organisation and suggested that manager’s should deal with 'complex human
beings' in different ways. The aim should be to use the untapped human potential in the service of organisations by
emphasising things such as self-direction, self- control and creativity.

 CONTRIBUTIONS

Behavioural scientists have made significant contributions to our understanding of individual motivation, group
behaviour, inter-personal relationships at work, and the importance of work to human beings. They have virtually laid
the foundation for the emergence of an exciting discipline, human resource management, which emphasises the
effective utilisation of human resources in organisations.

The concepts of job enrichment (making jobs interesting and challenging), management by objectives (a goal-setting
process conducted jointly by employees and their superiors) and positive reinforcement (rewarding good
performance) were results of the behavioural science approach.

 LIMITATIONS
The behavioural science approach, however, has several limitations. First, the self-actualising view (realising one
potential by using ones talents fully) assumes that all employees will seek self-actualisation at work. Although some
professional and managerial personnel may want self-actualisation, certainly not every employee has the same
desire. People have diverse needs; we cannot assume that everyone is motivated by the same need in the same
manner. Second, the behavioral scientists assume a great deal of compatibility between individual and organisational
goals. But in reality an individual desire to be autonomous and creative can be at odds with the organization need to
be efficient, orderly and predictable. Third, this approach discounted the non-human aspects of an organisation such
as task, technology and manufacturing. Fourthly, the behavioural approach fell into the same trap as earlier
approaches that searched for the one best way of managing. It assumed that the one best way of managing is
humanizing organisations. In the words of Prof Stoner, ‘The models and theories proposed by behavioural scientists
to use jargon rather than everyday language in communicating their findings have also inhibited understanding and
acceptance of their ideas. Finally, because human behaviour is so complex, behavioural scientists often differ in their
recommendations for a particular problem, making it difficult for managers to decide whose advice to follow'.

Quantitative Approach
Quantitative, scientific and systematic explanations gained popularity during World War II. The sheer magnitude of
the war effort caused the British and then the U.S. military services to look for quantitative approaches for help in
deploying resources in the most effective manner. The quantitative viewpoint focuses on the use of mathematics,
statistics, and information aids to support managerial decision-making and organisational effectiveness. Three main
branches have evolved over the years: management science, operations management and management information
systems.

Management science: This approach aims at increasing decision effectiveness through the use of advanced
mathematical models and statistical methods. This approach focuses on solving technical rather than human
behaviour problems. The computer has been of great help to this approach because it has enabled analyses of
problems that would otherwise be too complex.
Operations management: It is the function that is responsible for managing the production and delivery of an
organisation's products and services. It includes fields such as lnventory management, production planning, design
and location, work scheduling and quality assurance. Operations management is often applied to manufacturing
settings, in which various aspects of production need to be managed, including designing the production process,
purchasing raw materials, scheduling employees to work and storing and shipping the final products. Linear
programming assists in input-output analysis. Queuing theory helps in inventory control; sampling theory helps in
profit planning, manpower forecasting; information theory helps in system design and data Processing.

Management information systems: MIS is the name given to the field of management that focuses on designing and
implementing computer-based information systems for use by management. Such systems turn raw data into
information that is put to use at various levels of management.

Systems Approach

INTRODUCTION
The decisions taken by managers have wide ranging impacts. They affect the internal as well as external groups in a
significant way. The decision to shift the location of a plant, to close down a centre' to throw off workers, to promote
employees on the basis of merit whatever may be the case create a ripple effect. It is like throwing a rock into a quiet
pond, creating ripples for a long time. A simple instance of throwing ‘off a lazy worker may invite trouble from unions
and even lead to an unexpected strike. So, when a manager takes a decision, he must understand and anticipate its
repercussions on the entire organisation and the environment. He must appreciate the fact that his organisation is a
totality of many inter-related, inter-dependent parts, Put together for achieving certain objectives. This, in a nutshell, is
the very essence of the systems concept. Systems theory is the 'big-picture' approach that overcomes the common
weakness of viewing things in too narrow a perspective. It attempts to view the organisation as a single unified,
purposeful entity composed of interrelated parts. Rather than dealing separately with the various parts of an
organisation, the systems theory gives managers a way of looking at an organization as a whole and as a part of the
larger, external environment. In so doing, system theory tells us that the activity of an organisation affects the activity
of every other part. The job of a manager is to ensure that all parts of the organisation are coordinated internally so
that the goals can be achieved. A systems view of management, for instance, would recognise that, regardless of
how efficient the production department might be, if the marketing .Department do’s not anticipate changes in
consumer tastes and work with the product development department in creating what consumers want, the
organization overall performance will be hampered.

THE CONCEPT
Systems theory is the 'big-picture' approach that overcomes the common weakness of viewing things in too narrow a
perspective. It attempts to view the organisation as a single unified, purposeful entity composed of interrelated parts. Rather
than dealing separately with the various parts of an organisation, the systems theory gives managers a way of looking at an
organisation as a whole and as a part of the larger, external environment. In so doing, system theory tells us that the activity of
an organisation affects the activity of every other part. The job of a manager is to ensure that all parts of the organisation are
coordinated internally so that the goals can be achieved. A systems view of management, for instance, would recognise that,
regardless of how efficient the production department might be, if the marketing .Department do’s not anticipate changes in
consumer tastes and work with the product development department in creating what consumers want, the organization
overall performance will be hampered.

SYSTEMS VOCABULARY

Over the years, the following terms have found their way into the language of management:
1. System: A set of inter-related parts (sub-systems). Each part may have various sub-parts. These Parts are mutually
related to each other. Usually a change in one part would lead to a change in other parts.
 2. Sub-system: The parts that make up the whole of a system are called sub-systems. And each system may, in turn, be
a sub-system of a still larger whole. Thus, a department may be a subsystem of a plant, which may be a sub-system of
a company, which may be a sub-system of an industry, etc. There are five sub-systems within an organisation: (l) goal
sub-system (individual
3. And group goals); (2) technical sub-system (tools, equipment, employee skills, knowledge); (3) structural sub-system
(authority layers and relationships): (4) managerial sub-system (managers who plan, lead and control); (5)
psychosocial sub-system (psychological and social factors influencing people at work).

4. Synergy:- Synergy means that the whole is greater than the sum of its parts. A watch that is disassembled has the
same number of parts as one that is properly assembled. However, the assembled watch has a phenomenon that the
disassembled watch lacks-it keeps time (synergy): When the parts of an organisation are properly interrelated (such
as an assembly line), the output is much greater than it would otherwise be. Synergy represents one of the basic
challenges of management, getting all of the elements of an organisation functioning together so that output is
optimal.

5. Open and closed system: A system is considered an open system if it interacts with its environment; it is
considered a closed system if it does not. An organisation that is not adaptive and responsive to its environment
would not survive or grow in any extended period of time. It has to be responsive to demands placed on it by both its
internal and external environments.

6. System boundary: Each system has a boundary that separates it from its environment. In a closed system, the
system boundary is rigid; in an open system, the boundary is more flexible. The system boundaries of many
companies have become more flexible in recent times. For example, oil companies wishing to engage in offshore
drilling have increasingly had to consider public reaction to the potential environmental harm.

7. Flow: An open system receives inputs from its environment which are transformed into outputs in interaction with
environmental variables. For a business firm, inputs would be material, labour and capital. The transformation
process would turn these inputs into finished products or services. The system success depends on successful
interactions with its environment; that is, those groups or institutions upon which it is dependent. These might
include suppliers, unions, financial institutions, government agencies and customers. The sale of outputs generates
revenue, which can be used to pay wages and taxes, buy inputs, repay loans, and generate profits for shareholders. If
revenues are nor large enough to satisfy' environmental demands, the organisation shrinks or dies. Thus, a system
has flows of information, materials and energy. These enter the system as inputs, undergo transformation processes
within the system and exit the system as output as shown in Figure 3.5.

8. Feedback: Feedback is central to system controls. As operations of the system proceed, information is fed back to
the appropriate people or perhaps to a computer so that the work can be assessed, and if needed, corrected.
Feedback provides warning signals regarding impending dangers. For example, customer complaints may demand
attention to product improvement, customer service, etc.

 RELEVANCE AND USEFULNESS OF SYSTEMS THEORY

Systems theory makes organisation’ theorists search for integrative models rather than be satisfied with making lists of
unrelated principles (Fayol, Taylor). It also emphasises looking at the ‘forest rather than the trees. It uses a way of thinking that
highlights underlying relationships. The practical implications of systems theory for managers are enormous. Most effective
manager’s operate with a systems mentality even though they may not be consciously aware of it. As a mirror of course,
executives ask what effects a decision will have on others. They think before they act, implying a process of evaluating the
impact of their actions will have. A conscious commitment to systems thinking requires explicit responsibility for forming
decisions in terms of the entire organisation. Instead of merely looking at the technical side (scientific management) or
activities side (administrative management) or even the human side (human relations), executives are now forced to look at the
Totality of the situation and arrive at decisions. They can now easily maintain a good balance between the needs of the various
parts of the enterprise and goals of (taylor-fayol). They can respond, in short, to situational requirements in an effective way.

LIMITATIONS

It is true that systems theory, provides a broad philosophical perspective that bridges academic disciplines and mounts
integrated attack on a variety of problems. It is objective and. is not influenced by catch phrases like, 'one best way' and
simplistic prescriptions like, 'a manager decides things for others'. However, the conceptual framework for understanding
organisations provided by the systems theory is too abstract. It does nor attempts to identify, situational differences and
factors. Also, it tends to overemphasise 'oneness', coordination and harmony when, in fact, organisations have many,
natural' in-built conflicts, such as the supervisor as the man-in-the-middle. Providing more specificity in terms of variables and
if-then' relationships in a situational context is Left to the evaluation of the situational or contingency approach.

Contingency (Situational) Approach

INTRODUCTION

The problem with universal principles of management, as advocated by early theorists, is that few principles are universal.
Research has shown that management methods used in one circumstance seldom work the same way in others. Parents find
this out quickly when they realise that spanking one child may yield good results while spanking another can be emotionally
disturbing and disastrous. Some employees are most often motivated by economic gains while others have greater need for
challenging work. Still others care only about protecting their egos. The same individual may be motivated by different things in
a variety of situations.

THE APPROACH

Contingency theory is based on the premise that situations dictate managerial action; that is, different situations call for
different approaches. No single way of solving problems is best for all situations. Because tasks and people in organisations
differ, the contingency theorists (selznik, Burns and stalker woodward, Lawrence and Lorsch, James Thompson and others)
argue that the method of managing them must also differ. The choice of a particular method of managing largely depends on
the nature of the job, the people involved and the situation. According to contingency theory, effective management varies
with the organisation and. Its environment. Contingency theory attempts to analyse and understand these interrelationships
with a view towards taking the specific managerial actions necessary to deal with the issue. This approach is both analytical and
situational, with the purpose of developing a practical answer to the question, hand.

IMPORTANT ELEMENTS OF CONTINGENCY THEORY

Contingency theory has the following features:

 Managerial actions are contingent on certain actions outside the system or sub-system as the case may be.

 Organisational efforts should be based on the behaviour of actions outside the system so that the organisation gets
smoothly integrated with the environment.

 Managerial actions and organisational design must be appropriate to the given situation. A particular action is valid
only under certain conditions. There is no one best approaches to management It varies from situation to situation.
  IMPLICATIONS OF CONTINGENCY APPROACH

According to the contingency approach, there are no plans, organisation structures, leadership styles, or controls that will fit all
situations. There are few, if any, universal truths, concepts, and principles that can be applied under all conditions. Instead,
every management situation must be approached with the 'it all depends' attitude. Managers must find different ways that fit
different situations. They must continually address themselves with the question: which method will work best here? For
Example, in order to improve productivity, classical theory may prescribe work simplification and additional incentives; the
behavioral scientist may recommend job enrichment and democratic participation of the employees in the decision- making
process. Instead, a manager trained in the contingency approach may offer a solution that is responsive to the characteristics of
the total situation being faced. Organisations characterized by limited resources, unskilled labour force, limited training
opportunities, limited products offered to local market work simplification would be the ideal solution. Job enrichment
programme would work better if the organisation employs skilled labour force. Managerial action, thus, depends upon
circumstances within a given situation. No one best approach will work in all situations. Applying a contingency/situational
approach requires that managers diagnose a given situation and adapt to meet the conditions present.

According to Robert Albanese, the strength of contingency approach rests on two points; (i) First, it focuses attention on
specific situational factors that influence the appropriateness of one managerial strategy over another, (ii) Second, it highlights
the importance to managers of developing skills in situational analysis. Such skills will help managers find out important
contingency factors that influence their approach to managing.

The major implications of contingency theory may be summarized thus management is entirely situational managerial actions
are contingent on internal and external factors; managerial actions must be consistent with the requirements of internal as well
as external factors.

 EVALUATION
The contingency approach is a useful instructional device in the sense that it compels us to be aware of the complexity in every
situation and forces us to take an active and dynamic role in trying to determine that would work best in each case. Combining
the mechanistic (Taylor) and humanistic approaches (Mayo) the contingency theory suggests that different conditions and
situations require the application of different management techniques. It helps in fitting the classical and behavioural
Theories in a proper framework. It is an improvement over the systems theory in the sense that it only examines the
relationships between sub-systems of a specific organisation in a given environment, but also offers solutions to particular
organisational problems. The systems approach takes a general view of organisational variables, i.e., technical, social, personal,
structural and external variables. The contingency theory, on the other hand, is concerned with achieving a 'fit' between
organisation and its environment. Practising managers, however, seem to find this theory tenuous because it does not provide
any specific set of principles to use.

Contingency theory is attacked by several theorists on the following grounds:

Paucity of literature: Contingency theory suffers from inadequacy of literature. It has not developed to such an extent where it
can offer meaningful solutions to different managerial problems in a specific way. It is too simplistic to say thar 'managerial
actions depend on situations'. Instead, it must offer, in precise terms, what a manager should do in a given situation,

Complex Contingency theory is theoretically complex. Even a simple problem involves analyzing a number of organisational
components, each of which have innumerable dimensions. Often, managers may find this to be a difficult and taxing exercise.

Defies empirical testing: The precepts advanced by contingency theorists cannot be put to empirical testing in a concrete way.
There are multifarious situational factors to be taken into account while testing the contingency theory. For example, a
proposition that unless the various parts in an organisation move in close coordination, the behaviour at various organisational
levels would not be effective-seems to be a sound one. But when put to empyreal testing, several problems crop up almost
instantaneously.
Reactive not proactive: Contingency theory is also criticised on the ground that it suggests a reactive strategy in coping with
environmental complexity. Instead, a proactive strategy is needed where managers would be able to steer the organisation
through complex environments with their creative and innovative efforts.

Incomplete: Critics argue that the contingency approach does not incorporate dl aspects of systems theory and they hold that it
has yet not developed to the point at which it can be considered a true theory. Further, the goal of integrating functional,
quantitative, behavioural, and systems approaches in the form of a contingency model may prove to be too difficult to realise
because of the incomplete development of the earlier approaches. Critics also argue that there is really not much that is new
about the contingency approach. For example, they point out that even classical theorist like Fayol cautioned that management
principles require flexible application.

In spite of these valid critical expressions, contingency theory holds good at the micro-level, where managers are forced to look
into internal as well as external requirements while managing their organisations. It is small wonder; contingency theory is
welcomed as a 'refreshing breeze in management literature that clears away the humanistic and general systems 'fog'. The
systems theory takes a general view of organisation variables, i.e., technical, social, personal, structural and external variables.
The contingency theory, on the other hand, is concerned with achieving a 'fit' between organisation and its environment. Kast
and Rosenzweig have, therefore, rightly pointed our that the contingency theory ‘falls somewhere between simplistic, specific
principles and complex, vague notions'.

The contingency theory, like the systems theory recognizes that an organisation is the product of interactions between its
various constituent parts (sub-systems) and the environment. In addition, as a sort of refinement, it seeks to identify the exact
nature of interrelationships and interactions. In contrast to the vague systems terminology and perspective, the contingency
approach allows us to I specifically identifies' the internal and external variables that typically influence managerial actions and
organisational performance. Accordingly, what constitutes effective management varies with the organizations internal as well
as external environment and the make-up of the organisational sub-systems. Thus, the contingency approach falls somewhere
between simplistic, specific principles (classical theory) and complex, vague notions (systems theory). This approach provides a
long sought synthesis and brings together the best of all segments of what Prof Koontz has termed 'management theory jungle'.
The classical ideas and behavioural modifications are not rejected, but they are viewed as incomplete and not suited for all
organisations. Similarly, the ideas of systems theory that emphasise the interrelationship between parts also have not been
rejected bur they are viewed as vague and unspecific. If a way of correction, the contingency approach provides a pragmatic
method of analyzing organisation sub-systems and tries to integrate these with the environment. Contingency views are
ultimately directed towards-suggesting organisational designs and managerial actions more suitable for specific situations.

Modern Management Thought

Modern management thought (MMT) is an integrative theory in the sense that it combines the valuable concepts of classical
theory with the social and natural sciences. The source of inspiration for the modern management theory is the systems
analysis. Modern management theorists pick up where the Hawthorne researchers left off. MMT is characterised by the
following (Hicks and Gullet):

Open-system view: Modern management thought treats the organisation as an open system. It interacts with the environment
continually, in order to survive and flourish. It receives inputs from the environment, processes them into meaningful
products/services and offers them to the environment. In this process, the organisation tries to adapt itself to the changing
requirements of environment continually.

Dynamic and adaptive: Modern theory is dynamic. In line with changes in the outside environment, it tries to adapt itself
constantly.

Multilevel and multidimensional: MMT is both micro and macro in its approach. Ir is not a paradox. Ir is macro when considered
with respect to the entire nation or industry; it is micro with respect to internal parts of the organisation.

Multimotivated and multidisplinary: MMT recognises the fact that behaviour is the product of multifarious factors. In contrast
to the classical view of the worker as an economic man (motivated primarily by money), MMT views the individual as a complex
being who can be motivated in several ways (economic as well as non-economic incentives are important). MMT is
multidisciplinary in the sense that it heavily draws its concepts from various disciplines. Modern theory embraces economics,
sociology, engineering, psychology, anthropology and social psychology. Problem-solving and decision-making are the focal
points for study and research, drawing on numerous disciplines.

Descriptive and probabilistic: MMT is descriptive rather than prescriptive or normative. It does not tell how to handle things; it
simply tells how the things are handled. It is a way of describing an organisation and its Functioning. MMT is also probabilistic,
Not deterministic. Deterministic system is one where the outcome is predictable and certain. For instance, if you want to know
the total of 420 and, 11, you press the buttons in the calculator and the result will be 431, and not any other answer. It is a
deterministic system. However, probabilistic system is one where no uniquely determined outcomes exist. For example, if you
flip a coin into air, there is a chance of 0.5 of a head, but the outcome cannot be obtained with cent percent certainty at the
time of tossing the coin. Organisations also fall into this probabilistic system category. According to Scott and Mitchell, "the
modernists see the organisation as a probabilistic system... there is a high degree of uncertainty in these systems."

Integrative: The classical theory (consisting of scientific management, administrative management and bureaucracy) focuses
attention on the technical side of work whereas the neo-classical theory (human relations theory) on the human side of work.
Both theories discount the importance of taking an integrated approach to management giving weightage to both economic as
well as social variables at work. MMT tries to correct these deficiencies by aggregating the classical components with the
neoclassical band wagon.

Major Contributions of Leading Management Thinkers

MARY PARKER FOLLETT (1868 - 1933)

M.P Follex was a social philosopher. She studied political science, history, law and economics at Harvard and Cambridge. As a
political scientist, she examined the activities of many organisations In England and the United States. Though she did not
manage any organisation, her ideas had clear Implications for management practice. Important contributions of Follett to
management thought May be summarized thus:

1. Constructive conflict: According to Follett, conflict can be constructive. Conflict provides new challenges to
employees, brings out their abilities and talents and gives them activities interest of and zesr. The best way to resolve
a conflict is to integrate the parties involved in the conflict and examine the ways of resolving the conflict in a
cooperative manner.

2. Law of the situation: One person should not give orders to another person but should agree to take the orders
from the situation. The head of the production department does not give orders to the head of the marketing
department, or vice versa. Each studies the market and the final decision is arrived at depending on market
reQuirements.

3. Group ethic important Follett thought organisations should be based on group ethic rather than individualism.
Groups provide meaningful avenues for individuals to release their abilities in the service of the organisation. For
managers, this means that their job is to harmonies and coordinate group efforts. Managers and workers should view
themselves as partners in the production process.

4. Leadership: For achieving best results, management should not be autocratic. lraders should understand the
importance of group activity and integrate the efforts of all to serve a common Purpose.
 5. Authority and responsibility Follett argued that the concept of final authority residing in the position of the chief
executive should be replaced by the authority of function in which an individual has final authority for allotted tasks.
She pointed out that authority belongs to the job and stays with the job.

6. Coordination principles: According to Follett, coordination should be a continuous process; it should start at an
early stage. In other words, coordination should precede all other functions, it should start before formulating plans
and policies.

RENSIS LTKERT (1903 - 1972)

Rensis Likert, Director of the Institute of Social Research, University of Michigan, wrote two famous books; New Patterns of
Management and Human Organisation. According to Likert, the traditional job-centered supervision is mainly responsible for
low productivity and poor morale of employees. He, therefore, advocated the employee-centered approach where maximum
participation would be given to operatives while setting goals and making decisions. Likert is best known for his classification of
management styles into four categories:

System I (exploitative autocratic): Leaders have no confidence or trust in subordinates. Subordinates are deprived of
anticipation in decision-making.

System 2 (benevolent autocratic): Management has condescending confidence in subordinates just as a master has towards a
servant.

System 3 (participative): Leaders have substantial but not total confidence in subordinates. Participation is meaningful and
employees are permitted to participate in decisions affecting their lives.

System 4 (democratic): Participation is meaningful, as leaders have complete confidence and trust in subordinates.

According to Likert, system 4 is an ideal management style and is associated with high productivity low costs and good labour
relations. In an attempt to integrate individual and organisational goals, Likert developed the concept of 'linking pin'. In this
approach, each work group is integrated with the rest of the organisation by means of persons who are members of more than
one group. Members with such overlapping membership are known as 'linking pin. Accordingly, every employee acts as a
linking pin for the units above and below him. He is the leader for the lower level unit and is member in the upper level unit.

ETTON MAYO ( 1830-1949 )

Classical writers Like Taylor, Fayol and Weber viewed organisation as a machine, subject to certain principles and laws in its
design and management. They assumed that people are machine and they could be motivated by financial incentives alone.
They emphasised 'rationality, predictability, impersonality technical competence, and authoritarianism'. The behavioural
aspects have been totally ignored. On May, 8, L927 Elton Mayo and others initiated experiments at the Hawthorne plant of
'Western Electric Company focusing attention on the human dimensions of organisation. Th.y began to assesses the adequacy
of the simplistic, machine-model in various organisations. The most important findings of the Hawthorne studies may be
concluded thus:

 Organisation is a social system.

 The human factor is the most important element in organisations.

 Behaviour and sentiments are closely related and the group influences affect individual behaviour in a significant way.
  Group standards are highly effective in establishing individual worker output.

 Money is not so important in determining output when compared to group standards, group sentiments and security.

 Happy employees are productive workers.

 Special attention causes people to increase their efforts (known as the Hawthorne effect).

PETER F. DRUCKER

Peter Drucher had revolutionalised management thinking in early 50t with his path breaking books, articles and presentations.
He came into prominence with the publication of "The New society-' which presented a brief account of how the American
industrial giants influence the world economy. Prior to this, he wrote, 'The End of Economic Man' and 'The Future of Industrial
Man. His other works include The Practice of Management (1954), Managing for Results (1964), The Effective Executive (1967),
The Age of Discontinuity (1969) and Management: Tasks, Responsibilities and Practices ( 1974). Drucher is often hailed as a
genius who had pioneered several modern management concepts in the fields of innovation, creativity, problem solving,
organisation design, MBO etc. His chief contributions include:

 Nature of Management

 Management is a dynamic, life-giving element in an organisation.

 Management is a distinct, discipline and a social function.
 Managers should be creative and innovative in order to produce results. He opined that management is a
great profession full of challenges.

 Manager's Job

 Managers are known by their performance. They must set meaningful goals for the entire organisation.

 Business is inextricably interwoven with society. It has certain social obligations. Managers impact society
through their actions. It is their duty to meet social expectations’ regarding quality service, etc.

 Drucher wanted business community to stand on their own. Profit per se is not the villain of the piece. He
knew that 'a healthy business cannot exist in a sick society'. Managers should realise that businesses survive
and flourish only through the blessings of society.

 While meeting social expectations and enterprise objectives managers need to strike a fine balance. He
stressed the importance of setting goals, defining problems correctly and motivating people.

 He wanted businesses to deliver want-satisfying goods and services. The purpose of an enterprise is to
create a customer.

 He wanted managers to set meaningful objectives in eight key areas of business. Market standing,
innovation, productivity, physical and financial resources, profitability manager performance and
development, worker performance and social responsibility.

 MBO: Drucher stressed the importance of joint goal-setting through a novel concept called- Management By
Objectives ( MBO). He emphasised the importance of participatively set goals that are tangible, verifiable and
measurable. He wanted managers to focus on what must be accomplished (goals) rather than how it was to be
accomplished (methods).
  Decentralization: Drucher vehemently criticised the functional focus of managers, confining their work to their own
narrow specialised fields of study (such as marketing manager,. finance manager, production manager etc.). He
wanted managers to create autonomous, self-contained, independent product divisions within a large undertaking,
giving adequate and proportionate emphasis to various products. In place of task specialisation, he advocated federal
decentralisation. The federal structure, he felt, would make managers accountable for results and allow them to grow
steadily.

 Structure: Drucker wanted managers to reduce the number of layers within the organisation. The organisarion
structure should be dynamic in nature. To realise this, he suggested three concrete steps: activity analysis, decision
analysis and relations analysis.

o Activity analysis: What is to be done, how it should be put together, how much emphasis to be put on each
activity.

o Decision analysis: The degree of futurity in the decision, the impact of a decision on other activities, the
various qualitative elements that enter the decision-making process, whether the decision is a recurring
phenomenon or a rare once, etc.

o Relations analysis: Helps in providing a concrete shape to the structure and manning the structure properly.

 Decision-making: According to Drucher, the life of a manager is a perpetual choice-making activity. Management is
nothing but decision-making only. He wanted managers to define problems correctly before trying to find solutions.
He wanted managers to look into the following questions carefully:
 What is the problem?
 Which problem to solve?
 What is the real cause of the problem? (According to Drucher, critical factor analysis helps in identifying the causes
properly)
Managers must spend great deal of time in developing and evaluating alternative things. while ways of doing selecting a
solution, he wanted managers to (a) evaluate the risks of each course of action against expected gains (b) put emphasis on
economy of effort (c) give weightage to timing and (d) limitations of physical, financial and human resources

 Executive development: He said that successful managers did not wait for future, they made the future' He
wanted managers to be fully prepared for all future challenges by updating there, knowledge and competencies.

Summary
Management can be studied from various angle. The classical theory has three important branches bureaucracy prescribed that
an organisation be built around the work to be done the work must be logically divided and assigned to subordinate who are
expected to report the progress to superior at various level the whole system should have some well define rules so that results
can be obtained with very little fraction. Scientific management emphasised the importance of work design and encourage
manager to find one best way to do things with minimum effort and cost administrative theory listed important elements and
principal of management which can be studied and put into practice the classical school of thought thus focused attention on
the technical and administrative side of work and ignored the contribution of human beings completely.

The neo classical theory tried to correct this deficiency by drawing rich input from carious behavioural science and practical
experiment carried out by Elon mayo the theory attempted the creation of work force with high morale through democratic
means. The focus was on people incentive, democratization of workplace and social interactions. the human resources theory
went a step further by suggesting that human being are the most valuable asset in every organization. Every attempt therefore
must be made to exploit the latent potential of human resources by emphasizing things such as self control self direction and
self creativity
To improve the quality of decision making the quantitative approach has advocated the use of mathematics statistic and
computers extensively. The variable affecting each problem must be identified and measure in definite way . this would help in
solving issue in objective manner in eliminating subjective element in decision making completely

The system approach views the organisation as a unified, purposeful entity, consisting of interrelated parts while deciding
things, executives must look at the totally of the situation and the resultant consequence must strike a fine balance between
the needs of various parts of the enterprise and the goals of the firm as a whole.

According to the contingency approach there are no plan organisational structure and leadership styles, or controls that will fit
all situations. there are few if any universal truth and concept principles that can be applied under all conditions. manager must
find different way in different situations. Their actions, in the final analysis must be consistent as requirement of internal as
well as external factors.

Review Questions
1. Discuss briefly various schools of management thought.

2. What is bureaucracy? Outline the features of a bureaucratic form of organisation. Point out its merits and demerits.

3. Explain the principal contributions of F.W Taylor to the development of management thought.

4. List the Fayol principles of management.

5. Distinguish between Human Relations Theory and Scientific Management.

6. what are the major findings of Hawthorne Experiments? Examine their significance for the practising manager.

7. The neo-classical approach to the management has not provided any such thing as to replace the classical
management theory. Do you agree with this statement?

8. What are the major contributions of the Hawthorne experiments to the present day organisations?

9. Distinguish between human relations approach and human resources approach to organisations.

10. What are the major limitations of the neo-classical theory of management? Also point out its superiority over the
classical management theory.

11. IWhat is the systems approach to management? Examine the salient features of this approach.

12. Explain the importance of the systems approach to the study of management. Vhat are the limitations of this
approach?

13. Write an explanatory nore on the contributions of Peter Drucker to management thought.

14. What is the contingency approach to the study of management? Do you think it is an improvement over the systems
approach? Explain.

15. "The contingency approach to management is a common sense approach". Comment.

16. Outline the major contributions of the following thinkers:

 Mary Parker Folett

 Rensis Likert
  Elton Mayo
 Henry Fayol

17. Explain the major characteristics of modern management thought.

Discussion Questions

 Explain how a manager can use tools and techniques from each of the major management Perspectives in a
contemporary manner.

 Why is it important to understand the different perspectives and approaches to management theory that have
evolved throughout the history of organisations?

 Do you think management theory will ever be as precise as theories in the fields of physics, chemistry or experimental
psychology? Why or why not?

 Why is it important for every manager to understand the many different management theories that have been
developed?

Skill Building Exercise

 WHAT MOTIVATES YOUR EMPLOYEES?

Think of yourself as a manager. (Use your part-time or full-time job as a point of reference.) If you were the manager,
would you know what your employees really want? Their answers could surprise you. A survey of 2,000 workers and
their immediate supervisors found that what managers think employees want and what employees really want are
often at opposite ends of the spectrum. Rank the following most common motivators in terms of how effective they
would be for motivating you and your employees:-

Motivator ranking for you ranking for your employee

Money
Job security
Promotion
Personal development
'Working conditions
Interesting work
Loyalty from the company
Tactful discipline
Appreciation
Flexibility about personal needs
Feeling informed

In responding ro rhe survey, managers consistently saw themselves as being motivated by different factors than their
employees. They felt that the best ways to motivale employees were the traditional trio of morivators: job securiry
financial rewards and job advancement.
The problem is that the traditional motivators are scarce resources for a company- There is not an unlimited amount
of these to pass around. They cannot always be provided. So the majority of employees would remain unsatisfied if
these were the supervisor's primary means of motivation.

Everyone Can Be a VIP: There is some good news, however. The survey. also asked all the employees in the
company to say that really motivated them. They picked a very different set of motivators as most effective 'In fact,
the traditional trio of motivators was the bottom three of their list, The primary motivators of the empowered workplace
are what we call the VIP motivators: Validation: Respect for employees as people; Flexibility to meet personal needs;
Encouragement of learning, growth, and new skills'

Co ordination 4

Chrysler’s coordination problem

Without a major effort at coordination, an organisation may be like Chrysler Corporation when Lee lacocca took over. What I
found at Chrysler were 35 vice presidents, each with his own turf....I couldn't believe, for example, that the guy running
engineering departments wasn't in constant touch with his counterpart in manufacturing. But that's hot it was. Everybody
worked independently. I took one look at that system and I almost threw up. That's when I know I was in really deep trouble. I'd
call in a guy from engineering, and he'd stand there lost, when I'd explain to him that we had a design problem or some other
hitch in the engineering-manufacturing relationship. He might have the ability to invent a brilliant piece of engineering that
would save us a lot of month He might come up with a terrific new design. There was only one problem: he didn't know that
the manufacturing people couldn't build it. Why? Because he had never talked to them about it. Nobody at Chrysler seemed to
understand that interaction among the different functions in a company is absolutely critical. People in engineering and
manufacturing almost have to be sleeping together. These guys weren't even flirting! If one thing changed at Chrysler in the
year before lacocca retired, it was improved coordination. Cooperation among engineering, marketing and manufacturing
enabled the design and production of the stunning tine of new LH automobiles in only three years, in comparison to for years of
development, previously required. In recent times, just-in-time thinking and practice (aim to reduce to amount effort and
resources, allocated to managing inventory and work in progress) helped Chrysler (now part of Daimhr Chrysler) reengineer
many of its operation to become competitively leaner in the usage of severe Japanese competition.

INTRODUCTION

All organisations establish a variety of goals and direct their energies and resources to achieve them. The human as well as non-
human resources (materials, machines and money) have to be combined properly so as To achieve the goals of an organisation.
The various activities and efforts must be planned, organized and carried out in a systematic manner. Each department must be
informed about the activities of other departments, so that all of them work together smoothly. Coordination is the process of
integrating the objectives and activities of separate units of an organisation, to achieve organisational goal.

Meaning
In every organisation, the total work is divided into convenient parts. Different departments are created to process the
work quickly and efficiently. within each department again, there is division and sub-division of operations according
to the nature of tasks involved. Individuals working therein are, thus, related with others and their functions affect
others. In order to ensure a smooth flow of work, it is, therefore, necessary to synchronies the efforts. Of individuals
and groups, in a systematic way. The process by which a manager brings unity of action in an organisation is
coordination. According to Mooney and Riley, 'Coordination is the orderly arrangement of group efforts to provide
unity of action in the pursuit of a common purpose.' In the words of Henry Fayol, "To coordinate, means to unite and
correlate all activities". To quote McFarland, "Coordination is the process whereby an executive develops an orderly
Pattern of group efforts among his subordinates and secures unity of action in the pursuit of common purpose." On
the basis of these definitions, we can state the basic features of coordination, thus

Deliberate action: Coordination implies deliberate efforts to bring unity of purpose. It is achieved by conscious
managerial action; it is not automatic.

Group effort: Coordination applies to the group effort; not individual effort. It involves the orderly arrangement of
group efforts. Thus, there is no need for coordination, when an individual works in isolation without affecting anyone's
functioning. Coordination lays emphasis on unity of effort and unity of action.

Continuous activities:- Coordination is not an one-shot deal. It stands with the very first action, the process of
establishment of business and runs through until its closure. It is a never-ending process of ensuring the achievement
of objectives.

Permeates all management functions: Coordination permeates the entire process of management. It is a common
thread running through all the management functions. lf plans are not properly coordinated, the scarce resources are
put to ineffective use. In organizing work, managers must see that no activity remains unassigned. In staffing
managers must ensure the availability of competent people to handle assigned duties. The organisation should not
suffer because of inadequate or excess staff. In directing organisational activities, managers must synchronize the
efforts of subordinates and motivate them ‘through adequate rewards. In controlling organisational activities,
managers must see that activities are on the right path, doing right things, at the right time and in the right manner.
Thus, coordination transcends all managerial functions. That is, why, writers Like Koontz, Teeny called coordination x
the "quintessence of management."

Coordination vs. Cooperation

Cooperation is voluntary in nature. It refers to the willingness of people to help each other. Coordination, on the other hand, is
a deliberate effort of a manager to put things in order and achieve common objectives. For instance, take the case of a group of
people trying to move a heavy object. They have enough strength to carry our the task, willing to put in their best and are fully
conscious of their common goal. AII these things will not bear free unless someone takes charge and directs the members to
apply the right amount of effort, at the right place, at the right time. Coordination refers to such conscious and deliberate
blending of organisational activities to achieve unity of action.

DIFFERENCES BETWEEN COOPERATION AND COORDINATION

The chief distinctions between these concepts are summarized hereunder:

1. Status: Coordination is a necessary function of management. It is actually, the epitome of all management functions.
It is vital to carry out all the managerial functions successfully. Cooperation, on the other hand, does not enjoy the
status of a function of
2. Management. Cooperation is more of an attitude of an individual and group than anything else. Cooperation,
However, is essential for successful coordination.
 3. Deliberate: Coordination is the deliberate and intentional effort of the manager. Cooperation, on the other hand, is
voluntary, Management can function, even without cooperation, but cannot function without coordination.
Coordination, therefore, is a contrived process whereas cooperation is voluntary and natural process.

4. Nature of work: The nature of work in evolve organisation is such, that it needs to be divided, and then integrated.
Coordination of all independent activities is utmost essential. Cooperation does not arise out of any limitations of
structure and organisation. It is required all the time. The individuals learn to cooperate with each other even though
their activities are least related.

5. Broad: Cooperation is necessary' for coordination. But coordination is necessary for an organisation. Coordination
therefore, is broader of these two concepts. Even when cooperation exists if there is no proper coordination, the
organisation fails to deliver goods required in time ,

 Need for Co-ordination

The need for coordination arises whenever and wherever, a group of persons work together to achieve common objective.
Coordination is the basic cementing force in an organisation. The need for coordination mainly arises because of the following
disintegrating forces:

(i) Increase in size and complexity of operations: Growth in the number and complexity of activities is a major factor requiring
coordination. In a large organisation, a large number of people Process the work at various levels, These people may work at
cross purposes if their efforts and , activities are not properly coordinated. Size brings about the problem’s of communication as
well. It may be difficult to communicate the policies, orders and managerial actions on a face to- face basis. Personal contact is,
rather, impossible and formal methods of coordination become essential. If the operations of an organisation are multiple,
complex and diversified, the need of coordination is felt everywhere.

(ii) Specialization: Usually, in an organisation, work is divided along functional lines. Thus we have specialist’s taking care of
manufacturing, financing, personnel, marketing functions. Over a period of time, these specialists develop 'tunnel visions'
(inability to look beyond their own narrow specialty). They are more interested in developing their own departments and
stability increases their sphere of influence, in the organisation. For example, production executives might be more interested
in producing high-quality high-priced items. In the words of Stoner end Freeman, "'Without coordination, people and
departments would lose sight of their roles, within the organisation. They would pursue their own special interests, often,
achieve expense of organisational goals."

(iii) Clash of interests: People join an organisation to fulfill their personal goals, i.e., their physiological (Food, shelter, clothing,
entertainment) and psychological (economic security recognition for good work, freedom to do work independently, etc.)
needs. Often individuals fail to appreciate how the achievement of organisational goals will satisfy their own goals. The
environment in the organisation, organisational rules and regulations may also frustrate their attempts to realize their personal
goals. As a result, they are forced to pursue their narrow personal interests sacrificing organisational interests. They tend to
work at cross purposes. Coordination helps to avoid conflict between individual and organisational goals. Managers can bring
about harmony between individual and organisational goals by developing a closer contact with subordinates, by evolving
attractive incentive schemes, recognizing good work and by explaining how subordinates can achieve their own personal goals,
by achieving organisational goals.

Difference in attitudes and working style: According to Laurence and. Lorsch, the need for coordination, basically, arises owing
to the differences in attitudes and different working styles of people in an organisation. Every individual has his own way of
dealing with problems. The specific orientation towards particular goals might be different. To sales people, product variety
may take precedence over product quality. Accountants may see cost control, as most important to the organisation's success,
while marketing managers may regard product design as most essential. Further, there are differences in time orientation of
people. For example, production manager may be more concerned with problems that have to be solved immediately. Others,
Like the members of a research and development term, may be preoccupied with problems that will take years to solve. Again,
there may be differences in formality of structure. Each type of unit in the organisation may have different methods and
standards for evaluating progress, towards objectives and for rewarding employees. In a production department, for example,
the standards may be quite clearly defined in terms of cost, quality and schedule, and a control system may exist for precise
measurement of these criterions, In the personnel department, however, standards of performance may be quite broadly
defined, such as 'upgrading the skills of field personnel'.

Thus, the capacity talent and speed of people differ widely. It is, therefore, essential to reconcile differences in approach, timing
and effort of various departments, with a view to secure unity of action.

Independence of units :when a department depends on the activities of other departments (or units) to carry its own activity,
units are said to be inter-dependent. In an organisation, various units depend upon one another for their successful
functioning. In a restaurant, for example, the waiters, cooks, supervisors and cashiers are independent. To serve the customers,
each must make his own contribution, in an orderly manner. The chef must cook the meal, the waiters must serve the items,
the supervisors must greet the visitors in a systematic manner. All must move in unison, so that customers are satisfied, The
need for coordination increases with an increase in the interdependence between organisational units.

Significance of Coordination

Coordination is the epitome of management. It is important to the success of any enrerprise. It helps
an organisation in the following ways:

1. Increases efficiency: Coordination pulls all the functions and activities together. The human as well as non-human
resources are utilized in a right manner. Activities follow a specific direction. 'Waste motions, overlapping and
duplication of efforts, misuse of resources are, thus, prevented. Coordination enables an organisation to use its
resources in an optimum way. The resources flow through productive channels, paving the way for required quality
and quantity of output. Efficiency is thus improved.

2. Improves human relations: Coordination brings unity of action and direction. Members begin to work in an orderly
manner, appreciating the work put in by others. They understand and adjust with each other by developing mutual
trust, cooperation and understanding. They move closer to each other. In short, it improves human relations.

3. Interdepartmental harmony According to Fayol, where activities are well-coordinated, each department works in
harmony with the rest. Production knows its target; maintenance keeps equipment and tools in good order; Finance
procures necessary funds; Security sees to the protection of goods and service personnel and all these activities are
carried out in a smooth and systematic manner. Coordination, thus, creates a harmonious balance between
departments, persons and facilities. This in turn, helps in meeting goals efficiently and effectively.

4. Key to other functions: The importance of coordinator, largely lies in the fact that it is the key to other functions of
management like planning, organising, staffing, directing and controlling. The different elements of a plan, the various
parts of an organisation and phases of a controlling operation must all be coordinated. Coordinating makes planning
more purposeful, organisation more well-knit, and control more regulative and effective.

Principals of co-ordination

Coordination is crucial to the success of any organisation. Coordination is the process, whereby an executive develops an
orderly pattern of group effort among his subordinates and secures unity of action, in the pursuit of a common purpose.
Coordination is a continuous and dynamic process which emphasizes unity of efforts to achieve the desired results.
Coordination is essentially a managerial responsibility. Mary Parker Follet has spelt various principles of coordination in the
following fashion.

Principle of direct contactor:- In the first principle, Mary Parker Follet states that coordination can be achieved by direct contact
among the responsible people concerned. She believes that coordination can be easily obtained by direct interpersonal
relationships and direct personal communications. Such personal contacts bring about agreement on methods, actions, and
ultimate achievement of objectives. Direct contacts also help wither away the controversies and misunderstandings. It is based
on the principle, that coordination is better achieved through understanding, not by force, order and coercion.

Early stage: Coordination should start from the very beginning of planning process. At the time of policy formulation and
objective setting, coordination can be sought from organisational participants. Obviously, when members are involved in goal-
setting, coordination problem is ninety percent solved. It is because participative goal-setting enables agreement and
commitment to organisational goals and there is no question of conflict and incongruenry of goals of individuals and
organisations. Coordination, if not initiated in the early stages of planning and policy formulation, becomes difficult to exercise
in the later stages of execution of plans.

(iii) Reciprocal relationship: As the third principle, Mary Follet states, that all factors in a situation are reciprocally related. In
other words, all the parts influence and are influenced by other parts. For example, when A works with B and he in turn, works
with C and D, each of the four, find themselves influenced by others that is influenced by all the people in the total situation.
Follet contends that this sort of reciprocal relation and this sort of interpenetration of every pan by every other part, and again
by every other part, as it has been permeated by all, should be the goal of all attempts at coordination.

Principle of continuity:- The fourth principle, advocated by Follet, is that coordination is a continuous and never-ending process.
It is something which must go on all the times in the organisation. Further, coordination is involved in every managerial
function.

Principle of self-coordination: In addition to the four principles listed by Follet above, Brown has emphasised the principle of
self-coordination. According to this principle, when a particular department affects other function or department, it is in turn,
affected by the other department or function. This particular department may not be having control over the other
departments. However, if other departments are modified in such a fashion, that it affects the particular department favorably,
then self-coordination is said to be achieved. For instance, as we know there must be coordination between the level of
production and sales. When the production department all item its total production in such a way, so as to suit the sales
capacity of the marketing department (even before the marketing department makes request to cut down production or to
increase production), then self-coordination is said to have taken place. This, of course, requires effective communication
across the departments. This principle is rarely practised in day-to-day life.