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NOTES FOR MBA 1ST SEMESTER M. D UNIVERSITY, ROHTAK SUBJECT: - MANAGEMENT PROCESS & SKILL DEVELOPMENT
UNIT-1 THE FUNCTION OF MANGEMENT Management is the process of designing and maintaining an environment in which individual working togther ig-group efficiently accomplishes selected aims. Function of the management include planning, organizing, staffing, heading ,motivating,communication and controlling. Planing:-involves selecting mission and the action to achieve them;it requires decision making, that is choosing future courses of action from other alternate.planning bridges to gap from where we are to want to go.morel plan exists until a decision a commitment of human or material resource has been made.before a decision is made,all that exists is a planning study,an analtsis,or a proposal;there is no real plan. Organizing-is a part of managing that involves establishing an intentional structure of roles and position to fill in an organization. For an organizational role to exist and be meaningful to people ,it must incorporate (I)clear idea of the major duties or activities involve and (ii)an understood area of discretion or authority Os that the person filling the role knows what he or she can to do accomplish goals . it is in this sense that we think of organizing as(1) the identification and classification of required activities (2)the group of activities necessary to attain objectives (3)the assignment of each grouping to a manager with the authority(delegation)necessary to supervise it ,and (4)the provision for coordination horizontally and vertically on the organization structure. Stain:-involves filing and keeping field the position in the origination structure. This is done by identifying work force requirement ;inventorying the people available ;and recruiting ,selecting ,placingpromoting ,appraising ,lancing the careers of compensating and training or otherwise developing both candidates and current jobholders to accomplish theirs effectively and efficiently. Leadership:- is defined as the art or process of influencing people so that they will strive willingly and enthusiastically towards the achievement of group goals .ideally ,people should be encouraged to develop not only willingness to work but also willingness to work with zeal and confidence . zeal is ardor ,earnestness and intensity in the execution of work ; confidence reflect experience and technical ability . leaders act to help a group attain objective through the maximum application of its capabilities . they do not stand behind the group to push and prod ; they place themselves before the group a they facilitate proress and inspire the group to accomplish organization goals. The most important problems Aries from pope their desires and attitudes, their behavior as individuals and in-group-and that effective managers also need to be effective leaders,.since leadership implies followership and people tend to follow those who offer a make of satisfying their own needs wishes and desires,it is understandable that leading involves motivation,leadership style and communication
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PLANNING Planning is selecting mission and objective & the actions to achieve them,it require decision making,that is ,choosing among alternative future course of action. Planning bridges gap from where we are to where we want to go. There are several reasons of planning. 1) planning gives directions 2) planning reduces the impact of change 3) planning minimize waste 4) planning set standards used in controlling TYPES OF PLANS:A plan can encompass any course of future action ,which clearly shows that plans are varied.they are classified as 1) purpose or mission 2) objective 3) strategies 4) policies 5) procedures 6) rules 7) program 8) budget Purpose or Mission:- the mission or purpose identifies the basic function or task of an enterprise or agency
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When the lower cost and differentiation strategies have a board mass market target, they are simply called cost leadership and differentiation. When they are focused on a market niche (narrow target), however. They are called cost focus and different focus MAJOR KINDS OF STRATEGIES AND POLICIES For a business enter prices, the major strategies and polices that give an overall direction to operation are likely to be in the following areas.
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Responsibilities towards customers 1.providing goods and services at a reasonable price. 2.supply goods and services of promised quality, durability and services. 3.supply social harmless product. 4.offering an efficient consumer redress mechanism. 5.resisting profiteering and black marketing. 6.improving product quality towards r & d Responsibilities towards government
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Responsibilities towards society as a whole 1. 2. 3. 4. prevention of environment pollution. Preservation of ethical and moral values. Making provision of health education and cultural services. Minimizing ecological imbalance.
ORGANIZING Organization implies a formulized intentional structure of roles or positions. For an organization role to exist and be meaningful to people it must incorporate 1. verifiable objectives, which are major part of planning 2. a clear idea of the major duties or activities involved 3. an understood area of discretion or authority so that the person filling the rolled knows what he or she can do to accomplish goals. Organizing includes the following steps: a. b. c. d. the identification and classification of required activities grouping of activates necessary to attain objectives the assignment of each grouping to a manager with the authority necessary to supervise it the provision for co-ordination horizontally (on the same or similar organizational level) and vertically(e.g. corporate headquarters, divisions and department) in the organization structure.
An organization structure should be designed to clarify who is to do what tasks and who is responsible for what results. FORMAL ORGANIZATION:- intentional structure of roles in a formally organized enterprise UNFORMAL ORGANIZATION:- a network of personal and social relations not established or required by the formal organization but arising spontaneously as people associate with each other One aspect of organizing is the establishment of departments. Department designates a distinct area, division or branch of an organization over which a manager has authority for the performance of specified activities There is no single best way of departmentising that is applicable to all organizations or to all situations. The pattern used will depend on given situation and on what mangers believe will yield the best results for them in the situation they face. Departmentation can be on the basis of : a. time b. simple numbers c. function d. territory or geography e. customer f. product
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b.
Deportation by a simple number: Departmentation by a simple numbers was once an important method in the organization of tribes, clause and armies. The essential fact is not what people do, where they work or what they work with, it is that the success of the undertaking depends only upon the number of people involved in it. The usefulness of this organizational device has declined with each passing century. For one thing, technology has advanced, demading more specialized and different skills. Specialized personal are frequently more efficient than those based purely on numbers. Departmentaion by number is useful only at the lowest level of the organization structure. As soon as any factor other than pure human power becomes important the simple number basis of Departmentation fails to produced good results. Departmentation by time: one of the oldest forms of Departmentation generally used at lower level of the organization is grouping of activities on the basis of time. The use of shifts is common in many enterprises where for economic, technological or other reasons the normal work day will not suffice example this kind of Departmentation can be found in hospitals, the fire department has to be ready to respond to emergencies at any time. Advantages:- services can be reentered that go beyond the typical 8 hour day , often extending to 24 hours a day. Second ,it is possible to use process that can not be interrupted , those that require a continuing cycle Third ,expensive capital equipment can be used more than 8 hours a day .when workers in several shifts use the same machine. Fourth, some people student attending classes during the day for instance find it convent to work at night. Disadvantages- first, supervision may be lacking during the night shift Second, there is the fatigue factor , it is difficult for most people to switch ,for instance from a day shift to night shift and vise versa Third, having several shifts may cause problem in coordination and communication. Fourth, the payment of over time rate can be increase the cost of the product or service
c. DERPATMENTATIION BY ENTERPRISE FUNCTION :- growing activities in accordance with the function of an enterprise functional Departmentation embodies what enterprises typically do .since all enterprise undertake the creation of something useful and desired by others ,the basic enterprise function are a) production b) marketing c) financing functional daprtmentaion the most widely used basis for organizational activity and its present in almost every enterprise at some level in the organization structure.the characteristics of marketing ,production and financing are so widely recognized and thoroughly understood that they are the basis not only of departmental organization but also most often of Departmentation at the top level. ADVANTAGES:- the most important advantage of functional departmention is that it is a logical and time proven method. Functional Departmentation, follows the principle of occupational specialization and thereby facilitates efficiency in the utilization of people. DISADVANTAGES:- Functional departmention may tend to de-emphasize overall enterprise objectives. Accountants ,production experts and marketing people working in
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c.
DEPARTMENTATION BY TERRITORY OR GEOGRAPHY: Departmentation based on territory is common in enterprises that operate over wide geographic areas. In this case, it may be important that activities in a given area or territory be grouped and assigned to a manager. territorial Departmentation is most often used in sales and in production; it is not used in finance; which is usually consternated at the head quarters. ADVANTAGES Departmenttion by terririrty offers a number of advantages. It places responsibilities at the lower level, encourages local participation in decision making and improves coordination activities in a region. Mangers can give special attention to the needs & problems of local markets. Thus , they may result local sales people who are familiar with special situation in the area. More over , these sales people can spend more time sailing and less time travailing. Production may also be organize on a territorial basis by established plants in a particular region. This can reduce transpiration coast and delivery time. More over labor coast may be lower in certain regions, and producing things locally may create jobs & goodwill in the local community. DISADVANTAGES This kind of departmention requires more persons with general managerial abilities and shortage of them often a factor limiting the growth of an enterprise. Geography Departmentation tends to lead to duplication of services . thus managers of a territory want to have their own purchasing, personal, accounting & other services that are also carried out in their home office. This duplication can be castle . Finally, geography Departmentation may increase the problem of control by top managers at the head quarters, who may findid difficult to mentioned the activity of the department located at veracious territories. E. CUSTOMER DEPARTMENTATION
Grouping activities so that they reflect primary interest in customers is common in verity of enterprises bank can have a number of department, each catering to the needs of a specific type of customers. They can be departments for 1. 2. 3. 4. 5. community- city banking real estate & mortgage loan corporate banking agriculture banking institutional banking
ADVANTAGES.
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DISADVANTAGES 1. Requires more persons with general manger abilities. 2. Tends to make maintenance of economical center and services difficult. 3. Presents increases problem of top management control. G. MATRIX ORGNISATION. AN ORGANISIOTNAL structure that assigns speslist from different functional area to work on more project being led project manager. One unique aspect of matrix organization is dual chain of command employees in a matrix organization have two manager a) There functional departmental manager b) B) Project manager Advantages Is oriented toward end results Professional identification is maintained Pin points product profile responsibility Disadvantage Conflict in organization authority exists Possibility of sisuynity of command exist Require manager effective in human relations
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Clarity of plans: - much of the character of a subordinate job is defined by the plans to be into effect. If these plans are well defined, if they are workable, if the authority to undertake them has been delegated, and if the subordinate understand what is expected, a little of supervisor time will be required. Rate of charge:- certain enterprise charge much more rapidly ha others. The rate if charge is an important determinate of the degree to which policies can be formulated and the stability of polices maintained. The time frame of decision:- where quick on the spot decisions must be made the authority to make them must be delegated encouraging decentralization. Authority is delegated when a superior gives a subordinates desecration to make decisions. Delegation is necessary for an organization to exist. Just as no one pressing in an enterprise can do all the tasks necessary for accomplishing a group purpose, so it impossible, as an enterprise to grow, for one person to exercise all the authority for making decisions. The process of delegation involves:a. Determining the results expected from a position. b. Assigning tasks to a person. c. Delegating authority for accomplishing these tasks 1. Functional clarity:- the function to be performed, the methods of operation and the results expected must be clearly defined the authority delegated must be adequate to ensure that these functional are well performed. 2. Matching authority with responsibility:- Responsibility and authority are highly interconnected. Authority should be adequate and should only match the duties to be performed but also the personal capabilities of the subordinate. 3. Unit of command:- A subordinate should be responsible to only one superior who is delegating the authority in the first place. in this manner the responsibility for mistake or accomplishments is traceable and chances of conflict or confusion is minimal. 4. Principal of communication:- a misunderstood responsibility can be very dangerous. A general authority can be easily misuse. Accordingly, both the responsibility and authority must be clearly specify openly communication must be continuously kept open for issuing direction as well as receiving feedback.
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To be is the source of leadership. To do is the style of leadership by personal example. To see and to tell are the function, tools and technique of leadership. to be means the aggregate of all that there is leader and gives him a distinctive identity, his value, his quality and his knowledge. In others word, his personality. to be is a begging and the end of leadership to do indicates the best style of leadership is to lead by personal example. Style is the reflection of the substance in a man his personality. Personal example can be set only if the TO BE of the leader is worthy of emulation. The personal example transparent the most polenta technique of influencing people. Hence it is rightly called the method of silent persuasion. TO SEE implies that a leader mist be incomplete touch with the realties of the situation in which he is operating. He should have the fullest possible information regarding the problem about which a decision and a plan has to be formulated only than can he make around decision it also involves going out and seeing things one self on the ground. TO TELL means communicating to others what a leader want them to do. Telling is effective if the instructions of the leader are clearly understood. FUNCTIONS OF LEADERSHIP:- in practical term, a leader has to achieved the task function, group functions, and individual functions TASK NEEDS Defining the task Making the plans Allocating work and resources Controlling quality and tempo of work Checking performance against plan GROUP FUNCTION Setting standard example Maintain discipline Building team sprit Encouraging, motivating, giving a sense of purpose Appointing subleader Ensuring communication with in the group Training the group INDIVIDUAL NEEDS:Attending to personal problem Parsing of individual Knowing individual personally Recognizing and using individual abilities Training individual CHARACTERISTICS OF A GOOD LEADER Selflessness:- selflessness (or unselflessness or self sacrifice is the hub and heart indeed very foundation of a leader. Its two components are knowledge and character. Knowledge helps leader to determine what to do in any given situation. And the strength of character helps him to
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Disadvantages A. it may result in disorganized activities, which may lead to inefficiency an chaos. B. Insecurity an frustration may develop due to lack of specific decision making authority and guidance. C. The team sprit may suffer due to possible presence of some uncooperative members. D. Some members may put their own interests above the group and team interests. In practice, a leader may use all styles over period of time, but one style tends to predominate as his normal way of using power. For example, factory supervisor who is normally autocratic may be participate in determining vacation schedules and free rein in selecting the departmental representative for safety committee. It should be noted that the classification is not scientific.
THE PATH GOAL APPORACH TO LEADERSHIP EFFECTIVNESS The path goal theory suggests that the main function of the leaders is to clarify the set goals with subordinates, help them find the best path for achieving the results and remove obstacles. Leader behavior is categorized in to four groups:1. Supportive leadership:- Behavior gives consideration to the needs of the subordinates, show a concern for their well-being, and creates a pleasant organistaniol climates. It has the greatest impact on subordinates performance when they are frustrated and dissatisfied. 2. Participate leadership:- Allows subordinates to influence the decisions of their superiors and can result in increased motivation. 3. Instrumental leadership:- It gives subordinates specific guidance and clarifies what is expected of them; this includes aspctsof planning, organizing, coordinating and controlling by the leader. 4. Achievement-oriented leadership:- it involves setting challenging goals, seeking improvement of performance and having confidence that subordinates will achieve high goals. TRAIT APPROACHES TO LEADERSHIP This theory considers personal qualities and characteristics that differentiate headers from non-headers. Six traits on which headers tend to differ from non-headers are:a. Ambition b. The desire to lead c. Honesty & integrity d. Self confidence e. Intelligence
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In addition to his, people who are high self-monitors i.e. are highly flexible in adjusting their behavior in different situations- are more likely to emerge as leaders in GroupWise than low self monitors. FIELDERS CONTINGENCY APPORACH TO LEADESHIP This theory holds that people become leaders not only because of the attributes of their personalities but also because of various situational factors and the interactions between the leaders and group members. According to his theory the effective groups depend on a proper match between the leaders style of interacting with the subordinates and the degree to which the situation gives control and influence to the leader. Fielder described three critical dimensions of the leadership situation that determine leadership effectiveness. A. Lead-member relations:- The degree of confidence, trust and respect members have in their leader. B. Task structure: The degree to which assignements are procedures i.e. the extent to which tasks can be clearly spelled out and people held responsible for them. C. Position power:- The degree of influence a leader has over power variables such as hiring, firing, discipline, promotion and salary increases. LIKERT FOUR SYSTEMS OF MANAGEMENT Lakers has developed certain ideas and approaches important to understanding leadership behavior. He see an effective mangers as strongly oriented to subordinates, relying on communication to keep all parties working as a unit. All members of the group, including the manager/leader adopt a supportive attitude in which they share in one anothers common needs, values, Spartans, goals and expectations. Since it appeals to human motivations, Lakers views this approach as the most effective way to lead a group. Lakers has suggested four systems of management. Systems management is described as explotive-authrtive, its mangers are highly autocrat have little trust in subordinates, motivates people through fear and punishment and only occasional rewards fear and punishment and only occasional rewards, engage in down ward communication and limit decision making to the top. System 2 management is calls benevolent- authoritative:, it mangers have a patronizing confidence and trust in subordinates motivate with rewards and some fear and punishment permit some upward communication, solicit some ides and opinions from subordinates, and allow some delegation of decision making but with close policy control system 3 management is referees to as consultative angers in this system have substantial but not complete confidence and trust in subordinates, usually try to make use of subordinates ideas and opinions use rewards for motivation with occasional punishment and some participation engage in communication flow both down and up make broad policy and general decision at the top while allowing specific decision to be made at lower levels, and act consultatively in other ways. Lakers saw system 4 management as the most partipative of all and referred to it as participate group. System 4 managers have complete trust and confidence from subordinates and confidence in subordinates in all matter; they always get ideas and
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3.affiliation or affection ends (social needs) since people are social beings, the need to belong , to be accepted by others. These needs are concerned with:1. getting companyship, associating with someone , having a spouse and children. 2. Seeking acceptance by his fellow-beings. 3. Giving and receiving love and affection. 4. Becoming a member of a group, club, society etc. 5. esteem needs:- these needs are concerned with the awareness of importance to others (self esteem) and actual esteem from others. Self esteem 1) self esteem (i.e. self esteem) :- comprising feelings of competence, autonomy, independence, domainace, achievement and acquisition. 2) Esteem from others include the need for recognition attention, importance or appreciation or prestige, status and power to control. 6. self actualization:- mash regards this as the highest need in his hierarchy. These are the needs which help realize ones own potentialities for continued self development and for creative. It is the desire to become what one is capable of becoming to maximum ones potential and to accomplish something. TWO FACTORS OR HYGIENE THEORY OF HERZBERG. Mastow,s need approach has been considerably modified by Fredrick herzberg. His research purports to find a two factor theory of motivation according to herzberg. 1) there are some conditions of a job which operate primarily to dissatisfy employees when they are not present. However, the presence of these conditions does not bring strong motivation. herzberg called these factors maintain or hygiene factors, since they are necessary to maintain current status, i.e. a reasonable level of satisfaction . these factors causes much dissatisfaction when they are not present. But they do not provides storage motivation. Some of the maintenance factors include a) company policy and administration b) interpersonal relation with peers, subordinate and supervisor
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1.apparisal, praise and prestige:- when he does his work well the employed naturally wants it to be praised and recognized by his boss and fellow workers. Praise seems to have its greatest value when given and received as recgnigation. Recognition stacified human need for esteem by other and for self-esteem. This recognition may be shown in the form of praise, of a pat on the beck of the employee or a recommendation for a pay raise, promotion or assignment of more interesting tasks. 2.STATUS AND PRIDEU:- status refers to the social rank of a person and satisfies social egoistic needs. A management often tries to satisfy these needs by establishing status symbols and distinctions in its organization. Individual try hard to gain these have been achieved, there is a carving for higher status symbols. 3.competition:- as a form of motivation, competition is widely used in an organization. Individual do complete with one another if they feel they have chance of winning and satisfying theirego. This compassion may be in regards to sales production or safety assures. The person who is agiuaged the best is awarded the coveted prize. 4.delegation of authority :- an authority is the right to act, to direct, and to requisition resources needed to properly perform the job. The delegation of a substantial amount of responsibility to execute a given task often proves to be a strong motivation. The subordinate is more or less on his own. The supervisor trusts him. He feels that he must show results. 5. participation:- it implies the physical and mental involvement of the people in an activity especially in that of decision making. This satisfies ones ego and self esteem and the needs of creativeness and initiative. 6. Job security:- for some employees, this is an equally important motivator. Job security implies that an employee would continue on the job in the same plant or elsewhere and that he shall enjoy economic and social security against sickness, unemployment, disability, old age and death. 7. Job enlargement:- it is the process of increasing the complexity of the job in order to appeal to the higher order needs of workers. It implies that the employee perform more varied tasks, which are all of the same level the idea being to make the jobs less monotonous. The idea of job enlargement is to provide the workers with the opportunity to make greater use of their need for self esteem and dignity. 8. job rotation:- it implies the shifting of an employee from one job to another so that monotony and boredom are reduced. The basic objective of job rotation is to increase the skill and knowledge of the employee about related jobs. In job rotation workers learn to do all the different activities necessary for an operation or unit of work.
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