WHAT IS MANAGEMENT?

Actually, management as we understand it today is a fairly recent idea. Most

economists in the 18th and 19th centuries, for example, wrote about factors of
production such as land, labour and capital, and about supply and demand, as if
they were impersonal and objective economic forces which left no room for human
action. An exception was Jean-Baptiste Say, who invented the term entrepreneur,
the person who sees opportunities to use recourses in more productive ways.
Entrepreneurs are people who are alert to so-far uncovered profit opportunities.
They perceive opportunities to commercialize new technologies and products that
will serve the market better that it is currently being served by their competitors.
They are happy to risk their own or other peoples capital. They are frequently
unconventional, innovative people. But entrepreneurship isnt the same as
management, and most managers arent entrepreneurs.
So, whats management? Its essentially a matter of organizing people. Managers,
especially senior managers, have to set objectives for their organization, and then
work out how to achieve them. This is true of the managers of business enterprises,
government departments, educational institutions, and sports teams, although for
government services, universities and so on we usually talk about administrators
and administration rather than managers and management. Managers analyse the
activities of the organization and the relations among them. They divide the work
into distinct activities and then into individual jobs. They select people to manage
these activities and perform the jobs. And they often need to make the people
responsible for performing individual jobs form effective teams.
Managers have to be good at communication and motivation. They need to
communicate the organizations objectives to the people responsible for attaining
them. They have to motivate their staff to work well, to be productive, and to
contribute something to the organization. They make decisions about pay and
promotion.
Managers also have to measure the performance of their staff, and to ensure that
the objectives and performance targets set for the whole organization and for
individual employees are reached. Furthermore, they have to train and develop
their staff, so that their performance continues to improve.
Some managers obviously perform these tasks better than others. Most
achievements and failures in business are the achievements or failures of
individual managers.
What is Management?
Management is a universal phenomenon. It is a very popular and widely used
term. All organizations - business, political, cultural or social are involved in
management because it is the management which helps and directs the various
efforts towards a definite purpose. According to Harold Koontz, Management is
an art of getting things done through and with the people in formally organized
groups. It is an art of creating an environment in which people can perform and

individuals and can co-operate towards attainment of group goals. According to

F.W. Taylor, Management is an art of knowing what to do, when to do and see that
it is done in the best and cheapest way.
Management is a purposive activity. It is something that directs group efforts
towards the attainment of certain pre - determined goals. It is the process of
working with and through others to effectively achieve the goals of the
organization, by efficiently using limited resources in the changing world. Of
course, these goals may vary from one enterprise to another. E.g.: For one
enterprise it may be launching of new products by conducting market surveys and
for other it may be profit maximization by minimizing cost.
Management involves creating an internal environment: - It is the management
which puts into use the various factors of production. Therefore, it is the
responsibility of management to create such conditions which are conducive to
maximum efforts so that people are able to perform their task efficiently and
effectively. It includes ensuring availability of raw materials, determination of
wages and salaries, formulation of rules & regulations etc.
Therefore, we can say that good management includes both being effective and
efficient. Being effective is doing the appropriate task, i.e. fitting the square pegs in
square holes and round pegs in round holes. Being efficient means doing the task
correctly, at the least possible cost with minimum wastage of resources.
Management can be defined in detail in the following categories:
1.
2.
3.
4.
5.
6.
7.

Management as a Process
Management as an Activity
Management as a Discipline
Management as a Group
Management as a Science
Management as an Art
Management as a Profession
http://managementstudyguide.com/what_is_management.htm

Management as a Profession
Over a large few decades, factors such as growing size of business unit, separation
of ownership from management, growing competition etc have led to an increased
demand for professionally qualified managers. The task of manager has been quite
specialized. As a result of these developments the management has reached a stage

where everything is to be managed professionally.

A profession may be defined as an occupation that requires specialized knowledge
and intensive academic preparations to which entry is regulated by a representative
body. The essentials of the profession are:
1.

2.

3.

4.

5.

Specialized Knowledge - A profession must have a systematic body of

knowledge that can be used for development of professionals. Every professional
must make deliberate efforts to acquire expertise in the principles and techniques.
Similarly a manager must have devotion and involvement to acquire expertise in
the science of management.
Formal Education & Training - There are no. of institutes and universities
to impart education & training for a profession. No one can practice a profession
without going through a prescribed course. Many institutes of management have
been set up for imparting education and training. For example, a CA cannot audit
the A/Cs unless he has acquired a degree or diploma for the same but no minimum
qualifications and a course of study has been prescribed for managers by law. For
example, MBA may be preferred but not necessary.
Social Obligations - Profession is a source of livelihood but professionals
are primarily motivated by the desire to serve the society. Their actions are
influenced by social norms and values. Similarly a manager is responsible not only
to its owners but also to the society and therefore he is expected to provide quality
goods at reasonable prices to the society.
Code of Conduct - Members of a profession have to abide by a code of
conduct which contains certain rules and regulations, norms of honesty, integrity
and special ethics. A code of conduct is enforced by a representative association to
ensure self discipline among its members. Any member violating the code of
conduct can be punished and his membership can be withdrawn. The AIMA has
prescribed a code of conduct for managers but it has no right to take legal action
against any manager who violates it.
Representative Association - For the regulation of profession, existance of
a representative body is a must. For example, an institute of Charted Accountants
of India establishes and administers standards of competence for the auditors but
the AIMA however does not have any statuary powers to regulate the activities of
managers.
From above discussion, it is quite clear that management fulfills several essentials
of a profession, even then it is not a full fledged profession because: -

a.

It does not restrict the entry in managerial jobs for account of one standard
or other.
b.
No minimum qualifications have been prescribed for managers.
c.
No management association has the authority to grant a certificate of
practice to various managers.

d.
e.
f.

All managers are supposed to abide by the code formulated by AIMA,

Competent education and training facilities do not exist.
Managers are responsible to many groups such as shareholders, employees
and society. A regulatory code may curtail their freedom.
g.
Managers are known by their performance and not mere degrees.
h.
The ultimate goal of business is to maximize profit and not social welfare.
That is why Haymes has rightly remarked, The slogan for management is
becoming - He who serves best, also profits most.
(http://managementstudyguide.com/management_profession.htm)

1.

2.

3.

4.

Management as a science
Science is a systematic body of knowledge pertaining to a specific field of study
that contains general facts which explains a phenomenon. It establishes cause and
effect relationship between two or more variables and underlines the principles
governing their relationship. These principles are developed through scientific
method of observation and verification through testing.
Science is characterized by following main features:
Universally acceptance principles - Scientific principles represents basic
truth about a particular field of enquiry. These principles may be applied in all
situations, at all time & at all places. E.g. - law of gravitation which can be applied
in all countries irrespective of the time.
Management also contains some fundamental principles which can be applied
universally like the Principle of Unity of Command i.e. one man, one boss. This
principle is applicable to all type of organization - business or non business.
Experimentation & Observation - Scientific principles are derived through
scientific investigation & researching i.e. they are based on logic. E.g. the principle
that earth goes round the sun has been scientifically proved.
Management principles are also based on scientific enquiry & observation and not
only on the opinion of Henry Fayol. They have been developed through
experiments & practical experiences of large no. of managers. E.g. it is observed
that fair remuneration to personal helps in creating a satisfied work force.
Cause & Effect Relationship - Principles of science lay down cause and
effect relationship between various variables. E.g. when metals are heated, they are
expanded. The cause is heating & result is expansion.
The same is true for management; therefore it also establishes cause and effect
relationship. E.g. lack of parity (balance) between authority & responsibility will
lead to ineffectiveness. If you know the cause i.e. lack of balance, the effect can be
ascertained easily i.e. in effectiveness. Similarly if workers are given bonuses, fair
wages they will work hard but when not treated in fair and just manner, reduces
productivity of organization.
Test of Validity & Predictability - Validity of scientific principles can be
tested at any time or any number of times i.e. they stand the test of time. Each time
these tests will give same result. Moreover future events can be predicted with
reasonable accuracy by using scientific principles. E.g. H2 & O2 will always give
H2O.

Principles of management can also be tested for validity. E.g. principle of unity of
command can be tested by comparing two persons - one having single boss and
one having 2 bosses. The performance of 1st person will be better than 2nd.
It cannot be denied that management has a systematic body of knowledge but it is
not as exact as that of other physical sciences like biology, physics, and chemistry
etc. The main reason for the inexactness of science of management is that it deals
with human beings and it is very difficult to predict their behavior accurately.
Since it is a social process, therefore it falls in the area of social sciences. It is a
flexible science & that is why its theories and principles may produce different
results at different times and therefore it is a behavior science. Ernest Dale has
called it as a Soft Science.
(http://managementstudyguide.com/management_science.htm)
Management as an Activity
Like various other activities performed by human beings such as writing, playing,
eating, cooking etc, management is also an activity because a manager is one who
accomplishes the objectives by directing the efforts of others. According to
Koontz, Management is what a manager does. Management as an activity
includes 1.

Informational activities - In the functioning of business enterprise, the

manager constantly has to receive and give information orally or in written. A
communication link has to be maintained with subordinates as well as superiors for
effective functioning of an enterprise.
2.
Decisional activities - Practically all types of managerial activities are based
on one or the other types of decisions. Therefore, managers are continuously
involved in decisions of different kinds since the decision made by one manager
becomes the basis of action to be taken by other managers. (E.g. Sales Manager is
deciding the media & content of advertising).
3.
Inter-personal activities - Management involves achieving goals through
people. Therefore, managers have to interact with superiors as well as the subordinates. They must maintain good relations with them. The inter-personal
activities include with the sub-ordinates and taking care of the problem. (E.g.
Bonuses to be given to the sub-ordinates).
http://managementstudyguide.com/management_activity.htm
Management as a Discipline
Management as a discipline refers to that branch of knowledge which is connected
to study of principles & practices of basic administration. It specifies certain code
of conduct to be followed by the manager & also various methods for managing
resources efficiently.

Management as a discipline specifies certain code of conduct for managers &

indicates various methods of managing an enterprise. Management is a course of
study which is now formally being taught in the institutes and universities after
completing a prescribed course or by obtaining degree or diploma in management,
a person can get employment as a manager.
Any branch of knowledge that fulfils following two requirements is known as
discipline:
1.

There must be scholars & thinkers who communicate relevant knowledge

through research and publications.
2.
The knowledge should be formally imparted by education and training
programmes.
Since management satisfies both these problems, therefore it qualifies to be a
discipline. Though it is comparatively a new discipline but it is growing at a faster
pace.
http://managementstudyguide.com/management_discipline.htm

Management as a Process
As a process, management refers to a series of inter-related functions. It is the
process by which management creates, operates and directs purposive organization
through systematic, coordinated and co-operated human efforts, according to
George R. Terry, Management is a distinct process consisting of planning,
organizing, actuating and controlling, performed to determine and accomplish
stated objective by the use of human beings and other resources. As a process,
management consists of three aspects:
1.

Management is a social process - Since human factor is most important

among the other factors, therefore management is concerned with developing
relationship among people. It is the duty of management to make interaction
between people - productive and useful for obtaining organizational goals.
2.
Management is an integrating process - Management undertakes the job
of bringing together human physical and financial resources so as to achieve
organizational purpose. Therefore, is an important function to bring harmony
between various factors.
3.
Management is a continuous process - It is a never ending process. It is
concerned with constantly identifying the problem and solving them by taking
adequate steps. It is an on-going process.
http://managementstudyguide.com/management_process.htm

Management as a Group
Management as a group refers to all those persons who perform the task of
managing an enterprise. When we say that management of ABC & Co. is good,
we are referring to a group of people those who are managing. Thus as a group
technically speaking, management will include all managers from chief executive
to the first - line managers (lower-level managers). But in common practice
management includes only top management i.e. Chief Executive, Chairman,
General Manager, Board of Directors etc. In other words, those who are
concerned with making important decisions, these persons enjoy the authorities to
use resources to accomplish organizational objectives & also responsibility to for
their efficient utilization.
Management as a group may be looked upon in 2 different ways:
1.
2.

All managers taken together.

Only the top management
The interpretation depends upon the context in which these terms are used.
Broadly speaking, there are 3 types of managers -

1.

Patrimonial / Family Manager: Those who have become managers by

virtue of their being owners or relatives of the owners of company.
2.
Professional Managers: Those who have been appointed on account of
their specialized knowledge and degree.
3.
Political Managers / Civil Servants: Those who manage public sector
undertakings.
Managers have become a part of elite group of society as they enjoy higher
standard of living in the society.
http://managementstudyguide.com/management_group.htm
Management as an Art
Art implies application of knowledge & skill to trying about desired results. An art
may be defined as personalized application of general theoretical principles for
achieving best possible results. Art has the following characters 1.

Practical Knowledge: Every art requires practical knowledge therefore

learning of theory is not sufficient. It is very important to know practical

2.

3.

4.

5.

application of theoretical principles. E.g. to become a good painter, the person may
not only be knowing different colour and brushes but different designs,
dimensions, situations etc to use them appropriately. A manager can never be
successful just by obtaining degree or diploma in management; he must have also
know how to apply various principles in real situations by functioning in capacity
of manager.
Personal Skill: Although theoretical base may be same for every artist, but
each one has his own style and approach towards his job. That is why the level of
success and quality of performance differs from one person to another. E.g. there
are several qualified painters but M.F. Hussain is recognized for his style. Similarly
management as an art is also personalized. Every manager has his own way of
managing things based on his knowledge, experience and personality, that is why
some managers are known as good managers (like Aditya Birla, Rahul Bajaj)
whereas others as bad.
Creativity: Every artist has an element of creativity in line. That is why he
aims at producing something that has never existed before which requires
combination of intelligence & imagination. Management is also creative in nature
like any other art. It combines human and non-human resources in useful way so as
to achieve desired results. It tries to produce sweet music by combining chords in
an efficient manner.
Perfection through practice: Practice makes a man perfect. Every artist
becomes more and more proficient through constant practice. Similarly managers
learn through an art of trial and error initially but application of management
principles over the years makes them perfect in the job of managing.
Goal-Oriented: Every art is result oriented as it seeks to achieve concrete
results. In the same manner, management is also directed towards accomplishment
of pre-determined goals. Managers use various resources like men, money,
material, machinery & methods to promote growth of an organization.
Thus, we can say that management is an art therefore it requires application of
certain principles rather it is an art of highest order because it deals with moulding
the attitude and behaviour of people at work towards desired goals.
Management as both Science and Art
Management is both an art and a science. The above mentioned points clearly
reveal that management combines features of both science as well as art. It is
considered as a science because it has an organized body of knowledge which
contains certain universal truth. It is called an art because managing requires
certain skills which are personal possessions of managers. Science provides the
knowledge & art deals with the application of knowledge and skills.
A manager to be successful in his profession must acquire the knowledge of
science & the art of applying it. Therefore management is a judicious blend of
science as well as an art because it proves the principles and the way these

principles are applied is a matter of art. Science teaches to know and art teaches
to do. E.g. a person cannot become a good singer unless he has knowledge about
various ragas & he also applies his personal skill in the art of singing. Same way it
is not sufficient for manager to first know the principles but he must also apply
them in solving various managerial problems that is why, science and art are not
mutually exclusive but they are complementary to each other (like tea and biscuit,
bread and butter etc.).
The old saying that Manager are Born has been rejected in favor of Managers
are Made. It has been aptly remarked that management is the oldest of art and
youngest of science. To conclude, we can say that science is the root and art is the
fruit.
http://managementstudyguide.com/management_art.htm

MANAGEMENT FUNCTIONS
Management plays a vital role in any business or organized activity. Management
is composed of a team of managers who are in charge of the organization at all
levels. Their duties include making sure company objectives are met and seeing
that the business operates efficiently. Regardless of the specific job, most managers
perform four basic functions. These management functions are planning,
organizing, directing, and controlling.
Planning involves determining overall company objectives and deciding how these
goals can best be achieved. Managers evaluate alterative plans before choosing a
specific course of action and then check to see that the chosen plan fits into the
objectives established at higher, organizational levels. Planning is listed as the first
management function because the others depend on it. However, even as managers
move on to perform other managerial functions, planning continues as goals and
alternatives are further evaluated and revised.
Organizing,
the
second
management
function
is
the
process
of putting the plan into action. This involves allocating resources,
especially human resources, so that the overall objectives can be attained. In. this
phase managers decide on the positions to be created and determine the associated
duties and responsibilities. Staffing, choosing the right person for the right job,
may also be included as part of the organizing function.
Third is the day-to-day direction and supervision of employees.
In directing, managers guide, teach, and motivate workers so that
they reach their potential abilities and at the same time achieve the company goals
that were established in the planning process. Effective direction, or supervision,
by managers requires ongoing communication with employees.
In the last management function, controlling, managers evaluate how well the
company objectives are being met. In order to complete this evaluation, managers

must look at the objectives established in the planning phase and at how well the
tasks assigned in the directing phase are being completed. If major problems exist
and goals are not being achieved, then changes need to be made in the company's
organizational or managerial structure. In making changes, managers might have to
go back and replan, reorganize, and redirect.
In order to adequately and efficiently perform these management functions,
managers need interpersonal, organizational, and technical skills. Although all four
functions are managerial duties, the importance of each may vary depending on the
situation. Effective managers meet the objectives of the company through a
successful combination of planning, organizing, directing, and controlling.

MANAGEMENT AND HUMAN RESOURCES DEVELOPMENT

Managers perform various functions, but one of the most important and least
understood aspects of their job is proper utilization of people. Research reveals that
worker performance is closely related to motivation; thus keeping employees motivated is an essential component of good management. In a business context,
motivation refers to the stimulus that directs the behavior of workers toward the
company goals. In order to motivate workers to achieve company goals, managers
must be aware of their needs.
Many managers believe workers will be motivated to achieve organizational goals
by satisfying their fundamental needs for material survival. These needs include a
good salary, safe working conditions, and job security. While absence of these
factors results in poor morale and dissatisfaction, studies have shown that their
presence results only in maintenance of existing attitudes and work performance.
Although important, salary, working conditions, and job security do not provide
the primary motivation for many workers in highly industrialized societies, especially at the professional or technical levels.
Increased motivation is more likely to occur when work meets the needs of
individuals for learning, self-realization, and personal growth. By responding to
personal needs the desire for responsibility, recognition, growth, promotion, and
more interesting work managers have altered conditions in the workplace and,
consequently, many employees are motivated to perform more effectively.
In an attempt to appeal to both the fundamental and personal needs of workers,
innovative management approaches, such as job enrichment and job enlargement,
have been adopted in many organizations. Job enrichment gives workers more
authority in making decisions related to planning and doing their work. A worker
might assume responsibility for scheduling work-flow, checking quality of work
produced, or making sure deadlines are met. Job enlargement increases the number
of tasks workers perform by allowing them to rotate positions or by giving them
responsibility for doing several jobs. Rather than assembling just one component
of an automobile, factory workers might be grouped together and given
responsibility for assembling the entire fuel system.
By improving the quality of work life through satisfaction of fundamental and
personal employee needs, managers attempt to direct the behavior of workers
toward the company goals.

TIME MANAGEMENT
You can't manage time, it just is. So time management is a mislabeled problem,
which has little chance of being an effective approach. What you really manage is
your activity during time, and defining outcomes and physical actions required is
the core process required to manage what you do.
Time management could refer to all of the practices that individuals follow to
make better use of their time, but such a definition could range over such diverse
areas as the selection and use of personal electronic devices, time and motion
study, self-awareness, and indeed a great deal of self-help. As narrowly defined, it
refers to principles and systems that an individual uses for making conscious
decisions about the activities that occupy his or her time.
Overview
Time management strategies are often associated with the recommendation to set
goals. These goals are recorded and may be broken down into a project, an action
plan, or a simple task list. For individual tasks or for goals, an importance rating
may be assigned, deadlines may be set, and priorities assigned. This process results
in a plan with a task list or a schedule or calendar of activities. Authors may
recommend a daily, weekly, monthly or other planning periods, usually fixed, but
sometimes variable. Different planning periods may be associated with different
scope of planning or review. Authors may or may not emphasize reviews of
performance against plan. Routine and recurring tasks may or may not be
integrated into the time management plan and, if integrated, the integration can be
accomplished in various ways.
A task list (also to-do list) is a list of tasks to be completed, such as chores or steps
toward completing a project. It is an inventory tool that serves as an alternative to
memory. A task is a part of a project that needs to be accomplished within a
defined period of time. ... Inventory is a list of goods and materials, or those goods
and materials themselves, held available in stock by a business.
Task lists are used in self-management, grocery lists, business management, project
management, and software development. It may involve more than one list.
Task list is also a synonym for process list i.e. the list of program instances
(processes) the computer is currently executing. In computing, a process is an
instance of a computer program that is being executed.
Resistors
Fear of change: Change can be daunting and one may be afraid to change what's
proven to work in the past.
Uncertainty: Even with the change being inevitable, one may be hesitant as
being not sure where to start. Uncertainty about when or how to begin making a
change can be significant.
Lack of time: To save time, one has to invest time, and this time investment
may be a cause of concern. Fearing that changing may involve more work at the
start is a common resistor.
Lack of will power: Why to change if one doesnt really need to? The
greatest problem is a lack of will.

Drivers
Increased effectiveness: One may feel the need to make more time so as to
be more effective in performing the job and carrying out responsibilities.
Performance improvement: Time management is an issue that often arises
during performance appraisals or review meetings.
Personal development: One may view changing the approach to time
management as a personal development issue and reap the benefit of handling time
differently at work and at home.
Increased responsibilities: A change in time-management approach may
become necessary as a result of a promotion or additional responsibilities. Since
there is more work to do, and still the same amount of time to do it in, the approach
must change.
Performance appraisal is a method by which the performance of an employee is
measured (generally in terms of quality, quantity, cost and Time). Personal
development (also known as self-development, self-improvement or personal
growth) comprises the development of the self.
Dwelling on the lists
According to Sandberg, task lists arent the key to productivity [that]
they're cracked up to be. He reports an estimated 30% of listers spend more time
managing their lists than [they do] completing whats on them.
This could be caused by procrastination: by prolonging the planning activity,
the individual avoids the tasks he should be doing by creating the illusion that he's
still necessarily preparing for them. This is akin to analysis paralysis. As with any
activity, theres a point of diminishing returns. For a task system to be efficient and
effective, the user must recognize this, conquer his or her procrastination, and
focus on completing the tasks.
Hendrickson asserts that rigid adherence to task lists can create a tyranny of
the to-do list that forces one to waste time on unimportant activities.
To remain flexible, a task system must allow adaptation, in the form of
rescheduling in the face of unexpected problems and opportunities, to save time
spent on irrelevant or less than optimal tasks.
ABC analysis
A technique that has been used in business management for a long time is the
categorization of large data into groups. These groups are often marked A, B, and
C. Activities that are perceived as having highest priority are assigned an A,
those with lowest priority are labeled C. ABC analysis can incorporate more
than three groups. ABC analysis is frequently combined with Pareto analysis.
Pareto analysis is a statistical technique in decision making used for selection of a
limited number of tasks that produce significant overall effect.
Pareto analysis
This is the idea that 80% of tasks can be completed in 20% of the disposable time.
The remaining 20% of tasks will take up 80% of the time. This principle is used to
sort tasks into two parts. According to this form of Pareto analysis it is
recommended that tasks that fall into the first category be assigned a higher

priority. Pareto analysis is a statistical technique in decision making used for

selection of a limited number of tasks that produce significant overall effect.
The 80-20-rule can also be applied to increase productivity: it is assumed that 80%
of the productivity can be achieved by doing 20% of the tasks. If productivity is
the aim of time management, then these tasks should be prioritized higher. The
Pareto principle (also known as the 80-20 rule, the law of the vital few and the
principle of factor scarcity) states that, for many events, 80% of the effects comes
from 20% of the causes.
POSEC method

1.
2.
3.
4.

POSEC is an acronym for Prioritize by Organizing, Streamlining, Economizing

and Contributing.
The method dictates a template which emphasizes an average individuals
immediate sense of emotional and monetary security. It suggests that by attending
to ones personal responsibilities first, an individual is better positioned to shoulder
collective responsibilities.
Inherent in the acronym is a hierarchy of self-realization which mirrors Abraham
Maslows Hierarchy of needs (A Theory of Human Motivation).
PRIORITIZE your time and define your life by goals.
ORGANIZING-Things you have to accomplish regularly to be successful.
(Family and Finances)
STREAMLINING-Things you may not like to do, but must do. (Work and
Chores)
ECONOMIZING-Things you should do or may even like to do, but theyre
not pressingly urgent. (Past-times and Socializing)
CONTRIBUTING-By paying attention to the few remaining things that
make a difference. (Social Obligations)

HUMAN RESOURCE MANAGEMENT

Human resource management (HRM, or simply HR) is the management of
an organizations workforce, or human resources. It is responsible for
the attraction, selection, training, assessment, and rewarding of employees, while
also overseeing organizational leadership and culture, and ensuring compliance
with employment and labor laws. In circumstances where employees desire and are
legally authorized to hold a collective bargaining agreement, HR will typically also
serve as the companys primary liaison with the employees representatives
(usually a labor union).
HR now focuses on strategic initiatives like mergers and acquisitions, talent
management, succession
planning, industrial and labor
relations,
and diversity and inclusion.

Dave Ulrich lists the functions of HR as: aligning HR and business strategy, reengineering organization processes, listening and responding to employees, and
managing transformation and change.
The discipline may also engage in mobility management, especially pertaining
to expatriates. HR is generally viewed as a support function to the business,
helping to minimize costs and reduce risk.
During the 1990s and 2000s there was a growing movement of outsourcing of
human resources activities and promoting self sufficiency amongst line managers.
The growing use of E-technology supported such a move, with pioneering services
such as onlineHR.co.uk in the United Kingdom.
Talent management
Talent management refers to the anticipation of required human capital the
organization needs at the time then setting a plan to meet those needs.
Talent Management is the science of using strategic HR to improve business value
and make it possible for companies and organizations to reach their goals.
Everything that is done to recruit, retain, develop, reward and make people perform
is part of Talent Management as well as strategic workforce planning. A talent
management strategy needs to be linked to the business strategy to make sense.
The issue with many companies today is that their organizations put tremendous
effort into attracting employees to their company, but spend little time into
retaining and developing talent. A talent management system must be worked into
the business strategy and implemented in daily processes throughout the company
as a whole. It cannot be left solely to the human resources department to attract and
retain employees, but rather must be practiced at all levels of the organization. The
business strategy must include responsibilities for line managers to develop the
skills of their immediate subordinates. Divisions within the company should be
openly sharing information with other departments in order for employees to gain
knowledge of the overall organizational objectives.
Companies that engage in talent management are strategic and deliberate in how
they source, attract, select, train, develop, retain, promote, and move employees
through the organization. Research done on the value of such systems implemented
within companies consistently uncovers benefits in these critical economic areas:
revenue, customer satisfaction, quality, productivity, cost, cycle time, and market
capitalization. The mindset of this more personal human resources approach seeks
not only to hire the most qualified and valuable employees but also to put a strong
emphasis on retention.
From a talent management standpoint, employee evaluations concern two major
areas of measurement: performance and potential. Current employee
performance within a specific job has always been a standard evaluation
measurement tool of the profitability of an employee. However, talent management

also seeks to focus on an employees potential, meaning an employees future

performance, if given the proper development of skills and increased
responsibility.
The term talent management is usually associated with competency-based
management. Talent management decisions are often driven by a set of
organizational core competencies as well as position-specific competencies. The
competency set may include knowledge, skills, experience, and personal traits
(demonstrated through defined behaviors).
A talent marketplace is an employee training and development strategy that is set
in place within an organization. It is found to be most beneficial for companies
where the most productive employees can pick and choose the projects and
assignments that are most ideal for the specific employee. An ideal setting is where
productivity is employee centric and tasks are described as judgment-based
work, for example, in a law firm. The point of activating a talent marketplace
within a department is to harness and link individuals particular skills (project
management or extensive knowledge in a particular field) with the task at hand.
Examples of companies that implement the talent marketplace strategy are
American Express and IBM.
In current economic conditions, many companies have felt the need to cut
expenses. This should be the ideal environment to execute a talent management
system as a means of optimizing the performance of each employee and the
organization. Selection offers are large return on investments. Job analysis and
assessment validation help enhance the predictive power of selection tools.
However, within many companies the concept of human capital management has
just begun to develop. With more companies in the process of deepening their
global footprints, more questions have been asked about new strategies and
products, but very few on the kind of leadership structure that will bring them
success in their globalization process. In fact, only 5 percent of organizations say
they have a clear talent management strategy and operational programs in place
today.

PERSONNEL MOTIVATION: STRATEGIES TO STIMULATE

EMPLOYEES TO INCREASE PERFORMANCE
Personnel motivation is a key factor in getting employees to increase performance.
The question, however, is what managers can do to motivate employees to such a
level that performance will indeed increase.
Some workers do not produce the quality of work or maintain the level of
productivity which they are capable of. To some extent this may be attributed to
reticence on the part of the worker. The predominant cause, however, is likely to be

underutilization of the potential and capabilities of workers by management.

Workers are frequently bored, uninvolved and underutilized and this may
contribute to their level of productivity falling below their real potential.
Management often fails to present employees with the necessary challenges and
opportunities for achievement or to provide the type of leadership that will
motivate them and direct their behavior towards increased performance.
That the issue of employee motivation remains a crucial one in most institutions
was confirmed by an extensive survey carried out to determine the perceptions of
employees and their supervisors about employee motivation. It was found that the
greatest lack among managers was their ability to accurately perceive the factors
that motivate their employees.
The question of what management can do to create an environment in which
employees can be motivated to a high level of performance therefore, requires
managements attention.
Some authors see motivation as being contained within the individual whereas
others view it as arising from sources outside the individual. Examples that view
motivation as something that exists within the individual (internal or inherent
motivation), are the following:
Motivation is an inner state that energizes activates or moves, and that directs or
channels behavior toward goals (Berelson & Steiner).
Man is by nature motivated. He is an organic system, not a mechanical one ... We
do not motivate him, because he is motivated. When he is not, he is dead
(McGregor).
The needs, wants and desires which exist within an individual, make up his
internal motivation. These factors influence him by determining his thoughts,
which in turn lead to his behavior in a particular situation (Hicks & Gullett).
Motivation is getting somebody to do something because they want to do it
(Denny).
Motivation is the driving force in any individual which moves him (or her) to act
in a certain way. Practically spoken: it is what drives your employees to give their
best for your business (Franken).
The following are examples by authors who view motivation as something
arising from outside the individual (external motivation):
Motivation is the function which a manager performs in order to get his
subordinates to achieve job objectives (Scott & Mitchell).
Motivation is the process by which managers stimulate employee behavior and
direct it toward achieving desired personal and organizational goals (Megginson).
Motivation is any influence that causes, channels, and sustains people's behavior
(Hellriegel & Slocum).
... motivated employees are the product of good management - and that is their
responsibility (Grensing).
Although the responsibility of management is clearly emphasized in external
motivation theory, proponents of this theory do not negate internal motivation
theory. They rather consider external motivation as a theory that builds on internal

motivation. External motivation theory, in other words, includes the forces which
exist inside the individual as well as the factors controlled by the manager, namely
job context items such as salary and working conditions, and job content items
such as recognition and responsibility.
With the latter in mind, it is also important to take note of the views of Herzberg
(1968). He showed that every manager has two different kinds of factors he or she
should consider in dealing with his or her workers. Both kinds are absolutely
necessary in getting jobs done though they must be considered separately. These
factors are called maintenance factors and motivation factors. Maintenance factors,
like salary and working conditions, simply keep the worker on the job. The
presence of these factors causes satisfaction whereas their absence causes
dissatisfaction. Although these factors are prerequisites for motivation and cause
satisfaction, they do not contribute in enhancing a worker's desire to increase
performance. Herzberg indicated, for instance, that money is not a prime motivator
in getting people to do better work, although it may be important as a means of
getting things that do motivate such as recognition.
Motivation factors like achievement, recognition and responsibility on the other
hand, directly affect the motivation of the worker in making it higher or lower
according to whether or not the manager is using a particular strategy to stimulate
the worker's desire. The presence of these factors will both satisfy and motivate.
Although their absence may not necessarily cause dissatisfaction, it may lead to an
absence of motivation.
Although Herzbergs theory has been subjected to a great deal of criticism, one of
the most significant aspects he emphasized was the fact that job satisfaction is
dependent on the task itself. To merely get workers to do a job is not motivation.
The manager's task in motivation is rather to make sure his or her workers enjoy
doing what must be done. Franken (1994) correctly observes in this regard: I
think that there is clearly a difference between must work and wants to work
and this is where Herzbergs differentiation lies. To get workers to enjoy carrying
out a task relates to pride of achievement (Mol 1991). If the task itself is not a
source of pride for the worker, he or she will not be motivated. This, according to
Mol, is based on the assumption that the majority of workers have a basic need for
self-esteem and pride.
To conclude this discussion on the issue of what personnel motivation means, it
can be said that each individual is already motivated, but that such inherent
motivation can and should be stimulated by means of external motivation to inspire
performance. It seems that in order to get a highly motivated team of employees
who want to work, who strive to reach their peak performance everyday, who
enjoy the continual challenge of improving results and who maintain confident,
positive attitudes, management can play a decisive role in providing the stimulus
by enriching tasks in such a way that it will provide opportunities for increasing
performance, responsibility and a sense of utility and personal pride. Employee
motivation is entwined with so much of what a manager does. Perhaps a majority
of the actions taken by a manager, either directly or indirectly, somehow affects

employee perception of positive and negative outcomes experienced in either the

short or long run (Grant).