Chapter 5

Direction

Chapter outline
i. What is direction?

ii. Features of directing

iii. Importance of directing

iv. Principles of direction

v. Elements of direction

vi. Decision making

vii. Characteristics of decision-making

viii. Types of decisions

ix. The decision-making process

x. Management by objective-concepts and features

xi. Communication- Process

xii. Motivation

xiii. Importance of motivation

xiv. Motivation process

xv. Theories of motivation

What is direction?
 Direction represents one of the essential functions of management because it deals with human
relations. Once the organizational plans have been laid down, the structure being designed, and
competent people brought in to fill various positions in organization, direction starts. Direction is
the managerial function of guiding, motivating, leading and supervising the subordinates to
accomplish desired objectives. According to Dale, direction is telling people what to do and
seeing that they do it to the best of their ability. It consists of:

Principles and Practices of Management

Issuing orders and instructions by a superior to his subordinates (Communication) Guiding,
advising and helping subordinates in the proper methods of work (Leadership) Motivating them
to achieve goals by providing incentives, good working environment, etc (Motivation)
Supervising subordinates to ensure compliance with plans (Supervision)

FEATURES
It has the following features:

i. Deals with people: People are not primarily interested in enterprise objectives, they have
objectives of their own. Directing is, therefore, a complex function as managers have to deal
with people having diverse goals.
ii. Seeks performance: Direction translates plans into action and makes people goal oriented.
To obtain results, managers supervise the performance of subordinates and integrate effort at
various levels.
iii. Provides a link: Direction provides an important link between different functions in an
organization. Without direction, the individual goals and organizational goals would never
intermesh.
iv. Pervasive: Direction is performed by all managers at all levels of an organization. However,
the time spent on these activities decreases at higher levels of authority.

v. Dynamic and continuous: Direction is a dynamic and continuing activity of managers. A

manager has to modify the techniques of direction in order to keep pace with nchanging times. It
is an ongoing activity of managers.
IMPORTANCE OF DIRECTING
A few philosophers call Direction as ―Life spark of an enterprise‖. It is also called as on
actuating function of management because it is through direction that the operation of an

Benefits of Directing
1. It Initiates Actions – Directions is the function which is the starting point of the work
performance of subordinates. It is from this function the action takes place, subordinates
understand their jobs and do according to the instructions laid. Whatever are plans laid, can be
implemented only once the actual work starts. It is there that direction becomes beneficial.

2. It Ingrates Efforts – Through direction, the superiors are able to guide, inspire and instruct
the subordinates to work. For this, efforts of every individual towards accomplishment of goals
are required. It is through direction the efforts of every department can be related and integrated
with others. This can be done through persuasive leadership and effective communication.
Integration of efforts bring effectiveness and stability in a concern.

3. Means of Motivation – Direction function helps in achievement of goals. A manager makes

use of the element of motivation here to improve the performances of subordinates. This can be
done by providing incentives or compensation, whether monetary or non – monetary, which
serves as a ―Morale booster‖ to the subordinates Motivation is also helpful for the subordinates
to give the best of their abilities which ultimately helps in growth.

4. It Provides Stability – Stability and balance in concern becomes very important for long term
sun survival in the market. This can be brought upon by the managers with the help of four tools
or elements of direction function – judicious blend of persuasive leadership, effective
communication, strict supervision and efficient motivation. Stability is very important since that
is an index of growth of an enterprise. Therefore a manager can use of all the four traits in him so
that performance standards can be maintained.

5. Coping up with the changes – It is a human behaviour that human beings show resistance to
change. Adaptability with changing environment helps in sustaining planned growth and
becoming a market leader. It is directing function which is of use to meet with changes in
environment, both internal as external. Effective communication helps in coping up with the
changes. It is the role of manager here to communicate the nature and contents of changes very
clearly to the subordinates. This helps in clarifications, easy adaptations and smooth running of
an enterprise. For example, if a concern shifts from handlooms to power looms, an important
change in technique of production takes place. The resulting factors are less of manpower and
more of machinery. This can be resisted by the subordinates. The manager here can explain that
the change was in the benefit of the subordinates. Through more mechanization, production
increases and thereby the profits. Indirectly, the subordinates are benefited out of that in form of
higher remuneration.

6. Efficient Utilization of Resources – Direction finance helps in clarifying the role of every
subordinate towards his work. The resources can be utilized properly only when wastages,
duplication of efforts, overlapping of performances, etc. doesn‘t take place. Through direction,
the role of subordinates become clear as manager makes use of his supervisory, the guidance, the
instructions and motivation skill to inspire the subordinates. This helps in maximum possible
utilization of resources of men, machine, materials and money which helps in reducing costs and
increasing profits.

Principles of Direction
1. Principle of harmony of objectives: direction function must, first of all, resolve the conflict
between individual goals and organizational objectives. A manager must foster the sense of
belonging to the organization among the individuals so that they can identify themselves with the
company. When both the interests are integrated, contribution of subordinates to the company
will be maximum.

2. Principle of unify of command: A sound principle of direction is that the subordinates should
receive orders from one superior. Dual subordination brings disorder confusion, chaos, and
undermines the authority of a superior.

3. Principle of direct supervision: Direct supervision makes the subordinates happy and boosts
their morale. It also ensures quick feedback of necessary information.

4. Appropriate techniques: The technique used for direction should be appropriate to the
people, the task and the situation. Democratic style may work in some case but autocratic style
may produce results in certain other cases especially where subordinates are incapable of doing
things on their own.

5. Managerial communication: Two-way communication is an important part of direction. The

manager should explain the policies and practices to subordinates and the results expected of
them. The manager should encourage subordinates to express their views.

6. Informal organization: Managers should make use of informal groups to supplement,

support and strengthen the formal structure.

7. Principle of maximum individual contribution: The manager should inspire the

subordinates in such a way that they contribute their maximum while realizing organizational
objectives.

8. Use of motivation techniques: A manager should know how to motivate and inspire
employees. Motivation leads to higher job satisfaction.

9. Principle of follow-up: Direction is concerned with ensuring that people do what they are told
to do. This requires continuous feedback.

Elements of Direction
According to William Newman the directing function of management consists of the following
elements -

(a) Issuing orders and instruction to subordinates,

(b) Follow-up of instruction

(c) Standard practices and indoctrination,

(d) Explanations,

(e) Consultative direction Every instruction given by the manager in the process of directing the
employees must be reasonable, complete and clear. Hence written instructions are promoted. The
order of direction vocally discuss time and matter that had be instructed. Orders there of
executed are properly followed up to understand whether it is executed or not. The instruction
issued must promote standard practices. It half saves the time because of simplification of the
instructions. Explanations on the order that is the why part of it must be explained by the
manager giving instructions. To promote better execution of the order a manager before serving
it must discuss the order with the people involved in it.

Characteristics of a Good Order

1. The order should be clear and easily understandable.

2. It should be reasonable and attainable.

3. It must be complete in all respects leaving no doubt in the minds of subordinates as to what is
expected of them.

4. It should be compatible with the overall objectives of the organisation.

5. It must indicate the time period within which it should be carried out and completed.

6. The tone of the order should be appropriate and should stimulate ready acceptance.

7. It should preferably be in writing. This helps in ensuring uniform actions everywhere.

8. All orders should follow the chain of command.

9. When issuing the order, the manager should explain the purpose behind- i.e., why it is being
given.

10. The order should be regularly followed up and incorporate suggestions given by subordinates
when it is reissued.
 DECISION MAKING
What is decision making?
In fact what so ever a manager does they do by decision making. A decision is a choice made
from available alternatives. Decision-making is the process by which individuals select a course
of action among several alternatives, to produce a desired result.

Characteristics of Decision-Making
The important characteristics of decision-making are:
1. Goal-oriented: Decisions are made to achieve some goal. The intention is to move‘toward
some desired state of affairs‘.

2. Alternatives: A decision is characterized by two activities- search and choice. The manager
searches for opportunities, to achieve at decisions and for alternative solutions, so that action
may take place. Choice leads to decision, it is the selection of course of action needed to solve
problem.

3. Analytical-intellectual: Decision- making has both the intuitive and deductive logic; it
contains conscious and unconscious aspects. Part of it can be learned but part of it depends upon
the personal characteristics of the decision maker.

4. Dynamic process: Decision-making is the process by which individuals select s course of

action among several alternatives to produce a desired result. For example, a manager may hire
people based on merit regularly and also pick up candidates recommended by an influential
party, at times. Depending on the situation requirements, managers take suitable decisions using
discretion and judgment.

5. Pervasive function: Decision-making permeates all management and covers every part of an
enterprise. The end products of a manager‘s work are decisions and actions.

6. Continuous activity: Manager decides things on continual and regular basis. It is not a one
shot deal.

7. Commitment of time, effort and money: Decision-making implies commitment of time,

effort and money. The commitment may be for short term or long term depending on the types of
decision (e.g. strategic, tactical or operating). Once a decision is made, the organization moves in
a specific direction, in order to achieve the goals.

8. Human and social process: Decision-making is a human and social process involving
intellectual abilities, intuition and judgment. For example, in a labour surplus, capital-hungry
country like Indian managers cannot suddenly shut down plants, lop off divisions and extend the
golden handshake to thousands of workers, in fact of intense competition.

9. Integral part of planning: As Koontz indicated, ‗decision making is the core of planning‘.
Both are intellectual processes, demanding discretion and judgment. Both aim at achieving goals.
Both are situational in nature. Both involve choice among alternative courses of action.

Types of Decisions
The quality of decision making skills is one the critical success factors for managers. So it would
be useful to understand the ways in which decisions are made.

1. Basic and routine decisions

Basic decisions are unique, one-time decisions demanding large investments, creativeness and
good judgment on the part of managers. For example, decisions about launching a new product,
or buying a more advanced computer system, are non-routine decisions. They require
creativeness, intuition and good judgment, on the pat of managers. They are strategic decisions
which affect the future of an organization. As a manager progresses to higher levels, number of
basic decisions increase. Routine decisions are repetitive in nature. They require little
deliberation and generally concerned with short-term commitments. Generally, lower-level
managers look after such decisions. For example, a supervisor can decide, whether an
employee‘s absence is excused or unexcused, on the basis of personnel policy guidelines.

2. Personal and organisational decisions

Decisions to watch television, to study or retire early are examples of personal decisions. Such
decisions are taken by managers in their individual capacity. These cannot be delegated. Personal
decisions can ‗have an impact beyond the immediate system on whose behalf they were made‘.
Organizational decisions are made by managers in their official or formal capacity. They are
aimed at furthering the interests of the organization.

3. Programmed and unprogrammed decisions

Problem solving refers to a broad set of activities that involves finding and implementing a
course of action, to correct an unsatisfactory situation. It includes not only decision-making but
also the implementation, monitoring and maintenance of the decision. Programmed decision is
fairly structured or recurs with some frequency (or both). Non-programmed are made in response
to a situation that is unique, is poorly defined and largely unstructured and influences important
consequences of the organization.

Characteristics of programmed and non-programmed decisions

i. Problems are routine and repetitive.
ii. Solutions are offered in accordance with some habit, rule, or procedure.
iii. The conditions for programmed decisions are highly certain.
iv. Made by lower-level people.
v. Problems are unique and novel.
vi. These are no pre-established policies or procedures to rely on.
vii. Each situation is different and needs a creative solution.
viii. The conditions for nonprogrammed decisions are highly uncertain.
ix. Top management responsibility.

The Decision-Making Process

i. Awareness of a problem: The first step in the decision-making process is recognising
the problem. Problems arise due to disparity between what is and what should be. At this
stage, the emphasis should be on defining the questions in the right way rather than
finding answers to the questions.
ii. Diagnose and state the problem: Once manager become aware of a problem, he must
state the real problem. In order to state the true problems, the following questions should
be looked into: What is the problem? Which problem to solve? What is the real cause of
the problem?
iii. Develop the alternatives: Developing alternative solutions gurantees adequate focus and
attention on the problem. It helps managers to test the soundness of every proposal before
it is finally translated into action.
 iv. Evaluate the alternative: In this step, the decision maker tries to outline the advantages
and disadvantages of each alternative. The consequences of each alternative would be
considered.
v. Select the best alternative: In this step, the decision maker selects the alternative that
will maximize the results in terms of existing objectives. Peter Drucker has offered four
criteria, for making the right choice among available alternatives: The risk: the manager
has to weight the risks, of each courses of action against the expected gains.
vi. Economy of effort: The alternative that will give the greatest output for the least inputs.
vii. Timing: If the situation has urgency, the best alternative is the one that dramatises the
decision and if consistent effort is needed, a slow start is preferable.
viii. Limitation of resources: Physical, financial and human resources impose a limitation on
the choice of selection.
ix. Implement and verify the decision: After making a decision, the manager must
implement it and seek feedback regarding the effectiveness of the implemented solutions.

MANAGEMENT BY OBJECTIVE
Management by Objective
The concept of ‗MBO‘ was first given by Peter Drucker in 1954. It can be defined as a process
whereby the superiors and the employers come together to identify common goals, the
employees set their goals to be achieved , the standards to be taken as the criteria for
measurement of performance and contribution and deciding the course of action to be followed.

Therefore the essence of MBO is participative goal setting, choosing course of actions and
decision-making. An important part of the MBO is the measurement and the comparison of

the employee‘s actual performance with the standards set. Ideally, when employees themselves
have been involved with the goal setting and the choosing of the course of action to be followed
by them, they are more likely to fulfill their responsibilities.

Features of MBO
i. MBO emphasis participation in setting goals that is tangible, verifiable and measurable.
ii. MBO is a dynamic system which seeks to integrate the company‘s need to achieve its
goal.
iii. MBO is a systematic and rational technique that allows management to attain maximum
results from available resources by focusing on achievable goals.
The MBO Process
1. Define Organization goal

2. Define Employee Objectives

3. Continuous monitoring of performance progress

4.Performance Evaluation / Review

5. Providing Feedback

6. Rewards / Punishments

Advantages of MBO
i. Clarity of goals – SMART goals where S stands for Specific, M for Measurable, A for
ii. Achievable, R for Realistic and T for time-related.
iii. Focus is on future rather than on past.
iv. Motivated employees because there is involvement of employees in the whole process
v. of goal setting which results in their empowerment and thus commitment.
vi. Better communication and co-ordination - Frequent reviews and interactions between
superiors and subordinates helps to maintain harmonious relationships within the
enterprise and also solve many problems faced during the period.
vii. Managers can ensure that objectives of the subordinates are linked to the organization 's
objectives

Limitations of MBO
i. Pressure oriented
ii. Time consuming
iii. Increases paperwork
iv. Goal-setting problems
v. Organizational problems