UNIT - I

Introduction to
Management
 Management in different perspectives

 Management as a Noun – Group of people

 Management as a Process – Input–Process-Output

 Management as a Group/Team – Team effort

 Management as Discipline - Acquiring knowledge,

application of skills etc,.

 Management as an Activity – Separate class of

activities
 Management - Definition
“Management is the art of getting things done through
and with people in formally organised groups”.
-Harold Koontz
“Management is the process of planning, organizing,
actuating and controlling to determine and accomplish
the objectives by the use of people and resources”.
- Terry. G

“Management is a multi-purpose organ that manages

business and manages managers and manages workers
and work”.
- Peter Drucker
 Nature / Characteristics / Features of
Management
1. Management is Goal oriented.
2. Management is universal.
3. Management is a Social process.
4. Management is a group activity.
5. Management is a system of authority.
6. Management is intangible.
7. Management is a continuous process.
8. Management is Art as well as science.
9. Composite process and multidisciplinary.
10.Management is dynamic.
 Scope of Management / Functional
areas of Management

1. Production management

2. Marketing Management

3. Financial Management

4. Human Resource Management

5. Research and Development

Functions of Management
1. Planning
 Planning is decision making process which makes decisions
on future course of actions.
 Planning involves taking decisions on vision, mission, values,
objectives, strategies and policies of an organization.
 Planning is done for immediate, short, medium and long term
periods.
 It is a guideline for execution/implementation.

2. Organizing
 Organizing involves determination and grouping of the
activities.
 Designing organization structures and departmentation based
on this grouping.
 Defining the authorities, roles and responsibilities of the
departments and of the job positions within these
departments.
 Defining relationships between departments and job
positions.
3. Staffing:
 It includes manpower or human resource planning.
 Staffing involves recruitment, selection, induction and
positioning the people in the organization.
 Decisions on remuneration packages, training, development,
mentoring and counseling are important aspects of staffing.
 It also includes performance appraisals and designing and
administering the motivational packages.

4. Directing:
 It is one of the most important functions of management to
translate company's plans into execution.
 Directing includes Leadership, Communication, motivation
and supervision.
 Directing aims at achieving the best through the groups or
teams of people through team building efforts.
Controlling:
• It includes verifying the actual execution against the
plans to ensure that execution is being done in
accordance with the plans.
• Determination of standards.
• Measurement of actual performance.
• Comparing standards with performance.
• Taking corrective actions.
Levels of Management
 Levels of Management
Top Managers – Who are responsible for the
overall direction and operations of an
organization.
 Determine objectives and policies

 Designs the basic operating and financial

structure of an organization.
 Provides guidance and direction

 Lays down standards of performance

 Maintains good public relations

Middle Level Managers – Managers who
receive broad, overall strategies and policies
from top managers and translate them into
specific goals and plans for first-line
managers to implement.
 Interprets and explains the policies
framed by top.
 Issues detailed instructions.

 Participates in operating decisions.

 Trains other managers.

Lower Level Managers – Managers directly
responsible for the day to day operations..
 Plan day to day activities.

 Assigns job to workers.

 Provides supervision and control over

work.
 Arranges material tools and equipment.

 Maintains discipline.
 Importance & Need for Management
1. Optimum utilization of resources
2. Effective leadership and motivation
3. Establishes sound Industrial relations
4. Achievement of Goals
5. Facilitates growth and expansion
6. Improves standard of living
7. Encourages initiative & Innovations
8. Increases efficiency and reduces wastages
9. Increasing specialization of work
10. Encourages Team Work
11. Need for research and development
12. Establishes Equilibrium – Manages the change
 Managers
A Manager is the person responsible for
planning and directing the work of a group of
individuals, monitoring their work, and taking
corrective action when necessary.

Henry Mintzberg’s Managerial Roles:

 Interpersonal roles

 Informational roles

 Decisional roles
Henry Mintzberg’s Managerial Roles
Managerial Skills:
1. Technical skills – Ability to use the tools, procedures or
techniques of a specialized field.
2. Human skills – Ability to understand, motivate other people.
3. Conceptual skills – Ability to visualize the organization as a
whole.

Some other skills for effective manager:

1. Planning skills
2. Organizing skills
3. Leading skills
4. Controlling skills
5. Decision making skills
6. Problem solving skills
7. Analytical skills
8. Institution building skills
9. Communication skills
 Administration Vs Management
Administration:
1.Administration is the overall determination of policies,
setting of major objectives and the laying out of broad
programmes.
2.Administration is a top level function which centers around
the determination of plans, policies and objectives of a
business enterprise.
3.Administration is broader than management. It is a policy
making and determinative function

Management:
1.Management is an art of getting things done by a group of
people with the effective utilization of available resources.
2.It is concerned with the accomplishment of certain
objectives through the efforts of the people performing
certain functions
 Administration Vs Management
Administration Management
1. Nature Thinking Function Doing Function

2. Scope Determines broad Implements plans and achieves

objectives and policies goals through peoples

Top level function Middle and Lower level function

3. Level
Technical and Human Skills
Conceptual and Human
4. Skills
Skills
Paid individuals who work for
5. remuneration
Owners who invest capital
Represents and receive profits
Mostly in business
organizations
5. Uses Government, Military
Education etc,.
 Management as Science or Art
Management as Science:
Science is a systematized body of knowledge
based on certain principles, capable of general
application. This knowledge is obtained through the
process of observation, experimentation and testing.

 Systematic body of knowledge.

 Management as social science.

 Management is an inexact science.

 Scientific Management.
Management as Art:
Art is the application of knowledge and
personal skills to achieve results. Management is
an Art as it involves the use of knowhow and
skills like any other art.

 Use of knowledge

 Creative art

 Personalized

 Constant practice.
 Development of Management Thought

The art of management has its ancient roots.

1. Classical Theory

2. Neo-classical Theory

3. Modern Theory
 Development of Management Thought
I) Classical Theory:
 The classical theory means something traditionally
accepted and long established.
 The classical approach emphasises organizational
efficiency to increase the organizational success.

Elements of Classical Theory

 Inter-related functions

 Guiding principles

 Bureaucratic structures

 Reward-punishment nexus
 Branches of Classical
Theory

Administrative
Bureaucracy
Theory

Scientific
Management
1. Bureaucracy:
 Max Weber, the German sociologist developed the
bureaucratic management theory.
 Bureaucracy implies an organization characterized
by rules, procedures, rigid hierarchy of authority –
responsibility etc,.

Elements of Bureaucracy:
 Hierarchy
 Division of work
 Rules, regulations and procedures
 Records
 Impersonal relationships
 Administrative class
 2. Scientific Management
 Fredrick Winslow Taylor built the body of principles
that constitute the essence of Scientific Management.

 Scientific Management is an approach that

emphasizes the scientific study of work in order to
improve the workers efficiency.

BASICS OF SCIENTIFIC MANAGEMENT:

 Study the work scientifically.
 Select workers and train them.
 Match jobs and workers properly.
 Distribute gains between employer and
employee.
Scientific Management principles:
 Science, not rule of thumb
 Harmony, not discord
 Cooperation not individualism
 Maximum output in the place of restricted
output.
 Equitable division of work and responsibility.

Key Concepts of Scientific Management:

 Scientific task planning
 Time and motion study
 Standardization
 Differential piece rate system
 Functional foremanship
 3. Administrative Theory
 Henry Fayol developed the Administrative theory
which explained the process of managing an
organization from the top level perspective.

 Administrative theory is an approach that focuses

on principles that can be used by managers to
coordinate the internal activities of organization.

Management Functions:
 Planning
 Organizing
 Commanding
 Coordination
 Controlling
 Principles of Management / Henry Fayol’s 14
Principles
1. Division of Work 8. Order
2. Authority and 9. Centralization
Responsibility 10.Scalar chain
3. Discipline 11.Equity
4. Unity of Command
12.Stability of tenure
5. Unity of Direction
13.Initiative
6. Subordination of individul
14.Esprit de corps
interest to group
7. Remuneration of Personnel
II) NEO-CLASSICAL THEORY:
1. Human Relations Theory:
The Human Relations Theory tried to
compensate the deficiencies in classical theory
modifying it with insights form behavioural sciences
like psychology, sociology and anthropology.

Human Relations Theory is a movement in

management thinking and practice that emphasized
satisfaction of employees basic needs as the key to
increased worker productivity.
1. Hawthrone Experiments (Western Electric
Company):
To determine the effects of different levels of
illumination on workers productivity.

2. Interview programme:
 Mayo initiated the interview programme
covering 21000 employees to find out the
reasons for increased productivity.
 The point demonstrated in this programme
was Human relations movement.

3. Bank wiring room experiment.

2. Behavioural Science Approach:
It emphasis scientific research as the basis for
developing theories about human behaviour in
organizations that can be used to develop practical
guidelines for managers.

The behavioural appraoch applies the

knowledge of the behavioural science – psychology,
sociology and anthropology to managing people.
 Contributions of Behavioral Thinkers to
Management Thought

Name Period Contribution

Mary Parker 1868- Advocated the concept of
Follet 1933 ‘power sharing’ and integration
Elton Mayo 1868- Foundation for the Human
1933 Relations Movement;
Abraham 1908 – Motivated by a hierarchy of
Maslow 1970 needs
Douglas 1906- Theory X and Theory Y
McGregor 1964 personalities
Chris Classified organizations based
Argyris on the employees’ set of values
1. Mary Parker Follet (1868-1933)
 Power, according to Follet, was the ability to
influence and bring about a change.
 Concept of integration, which involves
finding a solution acceptable to all group
members
 Elton Mayo (1868-1933)
Pre-judgment Findings
Job performance The group is the key
depends on the factors in job
individual worker performance
Fatigue is the main Perceived meaning and
factor affecting importance of the work
output. determining output.
Management sets Workplace culture sets
production its own production
standards standards.
Maslow’s Need Hierarchy

Self actualization
needs

Esteem needs

Social needs

Safety needs

Physiological needs
 Douglas Mcgregor

Theory X Theory Y
Most People dislike Work is a natural
work activity like play.
Most People must be People are capable of
coerced and self direction and self
threatened before control
they work.
Most people prefer People become
to be directed. They committed to
avoid responsibility organizational
and have little objectives if they are
Chris Argyris
Maturity – immaturity theory
 People progress from a stage of immaturity
and dependence to a state of maturity and
independence.
 Model I and Model II organization analysis.
1. Model I organization are
manipulative
2. Model II organization are open to
learning
3. Quantitative Approach
It includes the application of statistics,
optimization models, information models and
computer simulations. More specifically, this
approach focuses on achieving organizational
effectiveness.
Three main branches:
 Management Science
 Operations Management and
 Management Information Systems.
i) Management Science:
 It stresses the use of mathematical
models and statistical methods for
decision-making.
 Another name is the Operations
Research.

ii) Management Information Systems:

Management information systems
focuses on designing and implementing
computer-based information systems for
business organizations.
III) Modern Approaches to Management

 Systems Theory

 Contingency Theory
1. Systems Theory
Inputs Transformation Outputs
process
Resources Managerial and
Technological  Goods
 Labor Abilities  Services
 Materials  Planning  Profits and
 Capital  Organizing losses
 Machinery  Staffing  Employee
 Information  Leading  satisfaction
 Controlling
 Technology

Feedback
 Contingency Theory
Systems Viewpoint
How the parts fits Contingency
together Viewpoint
•Individual
•Group Managers’
•Organization use of other
Traditional view points
•environment viewpoint to solve
What managers problems
do
Behavioral Viewpoint •External
•Plan
How managers influence
•Organize environment
others
•Lead
•Interpersonal Roles •Technology
• Control
•Informational Roles
•Individuals
•Decisional Roles
 Emerging Approaches In Management
Thought
 William Ouchi, outlined new theory called Theory
Z.

 It is the blend of positive aspects of both

American and Japanese management styles.

 Quality Management is a management approach

that directs the efforts of management towards
bringing about continuous improvement in
product and service quality to achieve higher
levels of customer satisfaction and build customer
loyalty.
 Organizational Environmental
The environment of business is the “aggregate of
conditions, event and influences that surround and affect
it”
- Davis
Features of Environment:
 Complex
 Dynamic
 Challenging

Environmental Forces:
 Internal Environment – The conditions and forces within
the organization.
 External Environment – Everything outside an
organization that might affect
it.
Components of External Environment:
1. Economic Environment
2. Social & Cultural environment
1. Demographic factors
2. Cultural factors
3. Religious, ethical and moral factors
3. Political Environment
4. Legal Environment
5. Technological Environment
6. Natural Environment
7. Task /Competitive/Operating Environment
 Clients
 Competitors
 Suppliers
 Labours
Components of Internal Environment:

1. Organizational aspects

2. Personnel aspects

3. Marketing aspects

4. Production aspects

5. Financial aspects
Relevance of Management in
Modern Industries
Management:
According to Trucker, “Management is the dynamic
life-giving element in every business. Without it the
resources of production remain resources and never
become produc­tion". Management is the catalyst
without which no organization can survive and grow.

Management is required to plan, organize, direct and

control group efforts. Management provides
leadership and motivation to individuals. There is
continuous need for management in an organization.
The significance of management in the modern
business world has increased tremendously
due to the following challenges:
1. Growing size and complexity of business.
2. Increasing specialization of work,
3. Cut throat competition in the market,
4. Growing unionization of labor.
5. Sophisticated and capital intensive technology,
6. Increasing complexity of business decisions,
7. Growing regulation of business by the Government,
8. Need for research and development,
9. Confused environment of business.
10. Need for integrating the interests of various groups,
e.g., owners, workers, customers and the public,
11. Need for optimum utilization of scarce resources.