Management Functions And Process,

Management Thought
Post : Gaurav Akrani Date : 6/01/2010 02:09:00 AM IST
Comments (14) Labels : Education, Management, Study Notes

What is Management?

The concept of management has acquired special significance in the present competitive and
complex business world. Efficient and purposeful management is absolutely essential for the
survival of a business unit. Management concept is comprehensive and covers all aspects of
business. In simple words, management means utilising available resources in the best possible
manner and also for achieving well defined objectives. It is a distinct and dynamic process
involving use of different resources for achieving well defined objectives. The resources are:
men, money, materials, machines, methods and markets. These are the six basic inputs in
management process (six M's of management) and the output is in the form of achievement of
objectives. It is the end result of inputs and is available through efficient management process.
The term 'management' is used extensively in business. It is the core or life giving element in
business. We expect that a business unit should be managed efficiently. This is precisely what is
done in management. Management is essential for the conduct of business activity in an orderly
manner. It is a vital function concerned with all aspects of working of an enterprise.

Definitions of Management

1. According to George R. Terry, "Management is a distinct process consisting of planning,

organising, actuating and controlling, performed to determine and accomplish stated
objectives by the use of human beings and other resources".
2. According to Henry Fayol, "To manage is to forecast and to plan, to organise, to
command, to coordinate and to control".
3. According to Peter Drucker, "Management is a multi-purpose organ that manages
business and manages managers and manages workers and work".
4. According to Harold Koontz, "Management is the art of getting things done through and
with people in formally organized groups”.
5. According to Mary Parker Fallett, "Management is the art of getting things done through
people".

Characteristics of Management

1. Management is a managerial process: Management is a process and not merely a body of

individuals. Those who perform this process are called managers. The managers exercise
leadership by assuming authority and direct others to act within the organisation.
Management process involves planning, organising, directing and unifying human efforts
for the accomplishment of given tasks.
2. Management is a social process- Management takes place through people. The
importance of human factor in management cannot be ignored. A manager's job is to get
the things done with the support and cooperation of subordinates. It is this human
element which gives management its special character.
3. Management is action-based: Management is always for achieving certain objectives in
terms of sales, profit, etc. It is a result-oriented concept and not merely an abstract
philosophy. It gives importance to concrete performance through suitable actions. It is an
action based activity.
4. Management involves achieving results through the efforts of others: Management is the
art of getting the things done through others. Managers are expected to guide and
motivate subordinates and get the expected performance from them. Management acts as
an activating factor.
5. Management is a group activity: Management is not an isolated individual activity but it
is a collective activity or an activity of a group. It aims at using group efforts for
 achieving objectives. Managers manage the groups and coordinate the activities of groups
functioning in an organisation.
6. Management is intangible: Management is not directly visible but its presence is noticed
in the form of concrete results. Management is intangible. It is like invisible spirit, which
guides and motivates people working in a business unit. Management is like government,
which functions but is not visible in physical form.
7. Management is aided, not replaced by computers: The computer is an extremely powerful
tool of management. It helps a manager to widen his vision. The computer supplies ocean
of information for important decision-making. The computer has unbelievable data
processing and feedback facilities. This has enabled the manager to conduct quick
analysis towards making correct decisions. A computer supports manager in his
managerial work. However, it cannot replace managers in business. They were required
in the past, at present and also in future. Their existence is absolutely essential in the
management process.
8. Management is all pervasive: Management is comprehensive and covers all departments,
activities and employees. Managers operate at different levels but their functions are
identical. This indicates that management is a universal and all pervasive process.
9. Management is an art, science as well as a profession: Management is an art because
certain skills, essential for good management, are unique to individuals. Management is a
science because it has an organised body of knowledge. Management is also a profession
because it is based on advanced and cultivated knowledge.
10. Management aims at coordination of activities: Coordination is the essence of
management. It gives one clear direction to the whole organisation and brings unity and
harmony in the whole business unit. For such coordination, effective communication at
all levels is essential.
11. Management is innovative: Management techniques are dynamic and innovative. They
need to be adjusted as per the requirements of the situations. Another manager need not
repeat the decisions of one manager. Similarly, a manager has to change his decisions
under different situations.
12. Management has different operational levels: Every Organisation needs managers for
managing business activities. The manager's job is basically the same at all levels. The
managers at the higher levels have more important duties while managers at the lower
levels have to perform routine functions i.e duties.
13. Management is different from ownership: Management is concerned with the
management of business activities. Managers are not the owners but they manage the
business on behalf of the owners. Separation of ownership and management is a special
feature of modem business organisation.
14. Management has vast scope: The scope of management is quite comprehensive. It covers
all aspects of business. The principles of management guide managers while managing
various business activities.
15. Management is dynamic: Business is influenced by changes in economic, social, political
technological and human resource. Management adjusts itself to the changing atmosphere
making suitable forecasts and changes in the policies. Hence, management is treated as a
dynamic activity.
 Need of Management

1. Direction, coordination and control of group efforts: In business, many persons work
together. They need proper direction and guidance for raising their efficiency. In the
absence of guidance, people will work as per their desire and the, orderly working of
enterprise will not be possible. Management is needed for planning business activities,
for guiding employees in the right direction and finally for coordinating their efforts for
achieving best/most favorable results.
2. Orderly achievement of business objectives: Efficient management is needed in order to
achieve the objectives of business activity in an orderly and quick manner.
3. Performance of basic managerial functions: Planning, Organising, Co-ordinating and
Controlling are the basic functions of management. Management is needed as these
functions are performed through the management process.
4. Effective communication at all levels: Management is needed for effective
communication within and outside the Organisation.
5. Motivation of employees: Management is needed for motivating employees and also for
coordinating their efforts so as to achieve business objectives quickly.
6. Success and stability of business enterprise: Efficient management is needed for success,
stability and prosperity of a business enterprise.

Modem business is highly competitive and needs efficient and capable management for survival
and growth. Management is needed as it occupies a unique position in the smooth functioning of
a business unit. This suggests the need of efficient management of business enterprises.
Profitable/successful business may not he possible without efficient management. In this sense,
"No management, no business" is true. Survival of a business unit in the present competitive
world is possible only through
efficient and competent management.

Importance of Management

1. Optimum utilisation of resources: Management facilitates optimum utilisation of

available human and physical resources, which leads to progress and prosperity of a
business enterprise. Even wastages of all types are eliminated or minimized.
2. Competitive strength: Management develops competitive strength in an enterprise. This
enables an enterprise to develop and expand its assets and profits.
3. Cordial industrial relation: Management develops cordial industrial relations, ensures
better life and welfare to employees and raises their morale through suitable incentives.
 4. Motivation of employees: It motivates employees to take more interest and initiatives in
the work assigned and contribute for raising productivity and profitability of the
enterprise.
5. Introduction of new techniques: Management facilitates the introduction of new machines
and new methods in the conduct of business activities. It also brings useful technological
developments and innovations in the management of business activities.
6. Effective management: Society gets the benefits of efficient management in terms of
industrial development, justice to different social groups, consumer satisfaction and
welfare and proper discharge of social responsibilities.
7. Expansion of business: Expansion, growth and diversification of a business unit are
possible through efficient management.
8. Brings stability and prosperity: Efficient management brings success, stability and
prosperity to a business enterprise through cooperation among employees.
9. Develops team spirit: Management develops team spirit and raises overall efficiency of a
business enterprise.
10. Ensures effective use of managers: Management ensures effective use of managers so
that the benefits of their experience, skills and maturity are available to the enterprise.
11. Ensures smooth functioning: Management ensures smooth, orderly and continues
functioning of an enterprise over a long period. It also raises the efficiency, productivity
and profitability of an enterprise.
12. Reduces turnover and absenteeism: Efficient management reduces labour turnover and
absenteeism and ensures continuity in the business activities and operations.
13. Creates sound organisation: A dynamic and progressive management guarantees
development of sound Organisation, which can face any situation - favorable or
unfavorable with ease and confidence.

The very survival of an enterprise depends on its management. Ineffective management leads to
disastrous consequences. According to George Terry, "Ineffective management cuts at the very
roots of economy of an enterprise’s. This suggests the importance of efficient management. In
brief, management occupies a unique position in the functioning of business enterprises. Its
importance and positive role is accepted in all sector-private, public, joint and co-operative.
Management is like a human brain. It is an integral aspect of business itself.

The importance of management is not fully realised in many developing countries. The economic
progress of western countries is not merely due to abundant material resources but because they
are efficiently managed and utilised. In other countries, resources are not utilised fully and
properly due to lack of managerial skills. This suggests that management is a key factor in the
working of business enterprises. There is no substitute to efficient management. An inefficiently
managed business enterprise has no place in the present complex and competitive business world
groups.