Principles Of Management Notes

Management Science Practice & Theory Management The art of getting things done through people Management is the process of designing and maintaining an environment in which individuals, working together in groups, efficiently accomplish selected aims. Basic definition needs to be expanded

All managers carryout managerial functions of planning, organizing, staffing, leading and controlling. Management applies to all kinds of organizations and managers at all levels of organization. It is concerned with productivity, which implies effectiveness and efficiency Job of managers is to create surplus.

Functions of Management Concepts, principles, theory and techniques of management are grouped into five functions Planning, Organizing, Staffing, Leading and Controlling. However, managers must be responsive to external environment; Economic, technological, social, ecological, political, and ethical

SkillsRequired by Manager Technical, Human, Conceptual, Design, and Communication Skills Goals of Managers and Organizations:

Aim of managers is to create a surplus by establishing an environment in which people can accomplish group goals with least amount of time, money, materials and personal dissatisfaction. To be successful in the 21st century companies must take advantage of IT especially the internet and globalization. Productivity, Effectiveness and Efficiency: Another aim is to raise productivity Productivity: Outinput ratio within a time period with due consideration for quality. Productivity can be improved by: Increasing outputs with same inputs, decreasing inputs & maintaining same outputs and increasing outputs & decreasing inputs to change ratio. Productivity implies: Effectiveness & efficiency in individual & Org performance Effectiveness: Achievement of objectives and Efficiency: Achievement of objectives with least amount of resources & time Managing: Science or Art: Managing as practice is an art. Organized knowledge underlying the practice is science. Science and art are complementary Management is Art: It is known how. It is doing things in the light of realities of a situation. Elements of art include Personal Skills, Practical Know How, Result Orientation, Creativity. Analysis of management practices against elements of Arts suggests that as a practice management is art Elements of Science Science is a systematized body of knowledge pertaining to a particular field It contains principles and theories developed through continuous observation experimentation and research. Principles have universal application and they are Verifiable and lead to predictable results. The organized body of knowledge can be taught and learnt Management: When reviewed against elements of science:

Management is doing things in the light of realities of situations.

Managers can work better by using organized knowledge Management is also a systematic body of knowledge It contains principles and theories developed over long periods of time after continuous observations, experimentations and research. These principles also have universal application and can be verified.

Therefore management as knowledge is science and its application is Art. Evolution of Management Thought Scientific Management Era (Upto 1880) The art of management has ancient routes. The moment people began to live and work together organization and management came into existence Modern management thought has developed through several stages Classic Approach (1830-1930) Approach was evolved in early part of 20th century. Many managers, to some extent, accept & practice even today. Main points of approach are:

Principles of management can be developed and implemented to make the organization effective Management principles have universal application with slight modification to suit various situations.

Scientific Management Approach: (1930-1950) Fredrick Taylor is the pioneer of Scientific Management Approach. His principles of scientific management are:

Develop a true science for each element of a workers job to replace the old rule of thumb method Division of labor should be a part of each job Scientific selection, training and development of workers should be done to improve the efficiency There should be closed cooperation between management and workers Workers should work for maximum output in place of restricted output

Human Relations approach Classical approach & scientific approach failed to recognize importance of human element in Mgmt. People were treated in rational and mechanistic terms Ignoring their social & psychological needs. Human relation approach emphasizes that:

A worker is not purely rational economic being. He has emotions and feelings Management is responsible to recognize and satisfy the social and psychological needs of workers in order to win their willing cooperation When workers are satisfied & motivated productivity & efficiency would increase Behavioral Science Approach An extension of human relation approach. It focuses on study of attitude, behavior & performance of individual and groups in organization. Based on belief that work is primary source of satisfaction & motivation. It is the responsibility of management to use potentials of people by crating a healthy work environment, Physical, social & psychological Evolution of Management Thoughts Fredrick Taylor (1856-1912 His primary concern was to increase productivity through efficiency and use of scientific methods. His principles emphasized using science, creating group harmony & cooperation and achieving maximum output & development of worker Principles: Replacing rule of thumb with science Obtaining harmony in group action, rather then discard. Achieving cooperation of human being, rather than chaos Working for maximum output rather than restricted output Developing all workers to the possible extent the their own & companys highest prosperity. Henry Gannt (1861-1919) He emphasized the need for understanding between the management and labor. He stressed upon importance of teaching development and understanding of system on the part of both labor and manager. Frank (1868-1924) & Lillian Bilbreth (1878-1972): Frank is known primarily for his time & motion studies whereas Lillians focus was on human aspects of work and understanding of workers personalities and needs. Henry Fayol (1841-1925:

According to him there are six industrial activities; Technical (Production), Commercial (selling), Financial, Security, Accounting (Statistical data), Managerial Function. He is considered as father of modern management theory. Principles: Divisions of work, Authority and responsibility, Discipline, Unity of commands, Unity of Directions, Subordinations of individual over general interest, Remuneration, Centralization, Scalar chain, Order , Equity, Stability of tenure, Initiative, Espirit de corps. Mintzbergs Managerial Roles 1. Interpersonal Figure Head: Symbolic head; obliged to perform a number of routine Duties of a legal or social nature Leader: Responsible for motivation & activation of subordinates responsible for staffing, training & associated duties Liaison: Maintains self developed network of outside contacts and informers who provide favors and information. 2. Informational Monitor: Seeks & receives wide variety of special information (much of it current) to develop thorough understanding of Org & environment. Emerges as nerve center of internal and external information about the organization Disseminator: Transmits information received from outsiders or from other subordinates to members of organization. Some information is factual; some involves interpretation and integration of diverse value, positions of organization, influencers Spokesperson: Transmits information to outsiders on organizations plans, policies, actions, results, etc. Serves as expert on organizations industry 3. Decisional Entrepreneur: Searches organization and its environment for opportunities and initiates improvement projects to bring about change. Supervises design of projects. Disturbance Handler: Responsible for corrective action when organization faces important, unexpected disturbance. Resource Allocator: Responsible for the allocation of organizational resources of all kinds. In effect, making or approval of all significant organizational decisions

Negotiator: Responsible for representing the organization at major negotiations. Systems Approach to Management Organized enterprise does not exist in the vacuum, it is dependent on the external environment. It receives inputs, transforms them and exports the out puts to the environment Inputs TransformationalProcess Outputs ExternalEnvironment Reenergizing the System Components of System Inputs: Human, Capital, Technology Output: Product, Services Environment: Consumers, Suppliers, Stock Holders, Government, Society Reenergizing the system: Following become human inputs and profit reinvested: Satisfaction and knowledge of employees, Buying of Machinery and Equipment, Construction of Building Inputs and Claimants Inputs: Inputs are transformed through managerial functions of planning, organizing, staffing, leading & controlling Inputs and Claimants: Inputs from external environment may include people, capital & managerial skills. In addition various groups of people make demands on the enterprise The Managerial Transformation Process: It is the task of managers to transform inputs in an effective and efficient manner into outputs. This is done through managerial functions of planning, organizing, and staffing etc. External Variables: Effective managers regularly scan external environment they may not have power to change external environment. They have no alternative but to respond to it Outputs: Managers secure and utilize inputs to the enterprise and Transform them through managerial function with due consideration for external variables into outputs

Reenergizing the system: In the systems model of operational management some of the outputs become inputs again. Thus satisfaction or new knowledge or skills of employees become important human inputs Even profits are reinvested in the form of Cash, Equipment, and Building & Machinery The Communication System: Communication is essential to all phases of managerial process for two reasons. First, it integrates managerial functions. Second, it links enterprise with external environment Where many of claimants are. Communication Integration Planning Staffing Controlling External Environment

Functions of Management Planning: The process of setting organizational goals and deciding in advance the action taken to achieve these goals. Involves Selecting missions, Objectives & Actions to achieve them. All conditions like available resource, environment, alternatives, Time are carefully analyzed before making decision about future course of action from amongst alternatives Organizing: The process of assembling and coordinating human, financial, and physical and other resources needed to achieve the organizational goals Establishing an intentional structure of roles for people to fill in an organization. People working in an Org must have a role to play. Role may be big or small but due importance and recognition must be given to it. For better management of an organization, it is essential to place right man for the right job. Staffing: The process of filling all positions & keeping them filled. It involves Recruiting, Selecting, Placing, Promoting, Compensating & Training employees Leading: Process of stimulating people to high performance. It involves directing, Motivating & Communicating to employees to influence them to achieve organizational goals Controlling; Evaluating and correcting individual performance to ensure that events conforms to plans. It is important to monitor progress of events. If objectives are not being achieved and Performance is not up to the mark, remedial measures must be taken. Deviation from

objectives, short comings & other observations must be given due consideration. All causes be evaluated & resolved as required coordination.