▪ According to Mary Parker Follet management is ‘the art of getting things done through

people’.
▪ A manager is a person who contributes to the organization’s goal indirectly by directing
the efforts of others, not by performing the task by himself. A person who is not a
manager makes his contribution to the organization’s goal directly by performing the
tasks by himself.
▪ According to George R Terry who defines management as “a process consisting of
planning, organizing, actuating and controlling performed to determine and accomplish
the objectives by the use of people and resources”.
▪ ‘Planning’ - thinking of the manager’s action in advance. The actions of the managers are based
on logic, plan or some method rather than hunch.
▪ ‘Organizing’ means coordinating machines, materials and human resources of the organization.
▪ ‘Actuating’ means motivating, directing the subordinates.
▪ ‘Controlling’ means that manager must ensure that there is no deviations from plans.

2
▪ Management is a process.
▪ A process is defined as systematic method of handling activities.

▪ Management is a discipline.
▪ Discipline refers to the field of study having well defined concepts and principles.
▪ Classifying management as discipline implies that it is an accumulated body of knowledge that
can be learnt.
▪ The purpose of studying management is to learn how to apply these principles and concepts at
right circumstances at the right time to produce desired result.

▪ Management is a human activity.

▪ Management is a career.
▪ Marketing management, finance management, personnel management, Industrial
management, production management, quality management.

3
▪ According to Ralph C Devis, “Management is the executive leadership anywhere”.

▪ According to William Spriegal, “Management is that function of an enterprise which concerns

itself with the direction and control of various activities to attain business activities”.
▪ Ross Moore states “Management means decision-making”.

▪ According to Donald J Clough, “Management is the art and science of decision making and
leadership”.
▪ Joseph L Massie defines as “Management is the process by which a cooperative group directs
actions towards common goals”.
▪ According to F.W. Taylor, “Management is the art of knowing what you want to do and then
seeing that it is done in the best and cheapest way”.
▪ John F Mee states “Management is the art of securing maximum results with minimum efforts so
as to secure maximum prosperity for employer and employee and give the public the best
possible service”.
▪ According to Koontz and O’Donnel, “Management is the direction and maintenance of an
internal environment in an enterprise where individuals working in groups can perform
efficiently and effectively towards the attainment of group goals”. It is the art of getting the 4
work done through and with people in formally organized groups.
Management is a continuous process
▪ consists of planning, organizing, directing and
controlling the resources to ensure that resources
are used to the best advantages of the organization.
▪ continuous planning, organizing, directing and
controlling.
Management is an art as well as science
▪ ART: possessing managing skill by a person
▪ SCIENCE: requires systematic study based on the
scientific methods to analyse business problems and
to find optimal solutions
Management aims at achieving predetermined
objectives
▪ All organizations have objectives that are laid down.
▪ Every managerial activity results in achievement of
these predetermined objectives.
5
Management is a factor of production
▪ An enterprise produce goods or services using resources like land, labour, capital,
machines etc.
▪ These resources themselves cannot realize the organizations goals.
▪ In case of small enterprises an individual can do such type of job where as in large
enterprises the coordination job is done by management.
Management is decision-making
▪ Decision-making is selecting the best among alternative courses.
▪ A manager must make a right decision at right time.

6
Universal application:
▪ The principles and concepts of management
are applicable to every type of industry.
▪ The practice of management is different from
one organization to another according to their
nature.

Management is needed at all levels:

▪ The functions of management are common to
all levels of organization.
▪ The functions of planning, organizing,
directing, controlling, decision-making are
performed by top level as well as lower level
supervisors. 7
Management aims at maximum profit
▪ The resources are properly utilized to
maximize profit. Maximizing the profit is
the economic function of a manager.
Dynamic
▪ Management is not static.
▪ Over a period of time new principles,
concepts and techniques are developed
and adopted by management.
▪ Management is changed accordingly to the
social change.
8
Management as a career
▪ Marketing management, finance
management, personnel management,
industrial management, production
management, quality management are
some of the specializations in management.
Management is a profession
▪ Management is a profession because it
possesses the qualities of a profession.
▪ The knowledge is imported and
transferred.
▪ The established principles of management
are applied in practice.
9
Management is a discipline
▪ Discipline refers to the field of study
having well defined concepts and
principles.

10
▪ The hierarchy of the levels in management is always restricted to
1. Minimum Two
2. At least Three
3. At least Four
4. Depends on the industry
A good manager is the one who can get the work done by his team mates
1. True
2. False
Who among the following succeeded Bill gates as CEO ?
1. Steve Jobs
2. Sathya Nadella
3. Steve Ballmer
11
Multidisciplinary:
▪ It draws freely ideas and concepts from the disciplines like economics, sociology,
psychology, statistics etc.
▪ Management integrates the ideas taken from various disciplines and presents
newer concepts which can be put into practice.
Dynamic nature of principles:
▪ A principle is truth which establishes cause and effect relationships of a
function.
▪ These principles are flexible and change with the environment in which
organization works.
▪ There is nothing permanent in management.

12
Relative not absolute principles:
▪ Management principles are relative and not absolute.
▪ They must be applied according to the need of the organization.
▪ Each organization is different from other. The principles of management should be
applied in the light of prevailing conditions.
Management – science or art
Universality of management:
▪ Management is universal phenomena.
▪ Though universal yet management principles are not universally applicable but are
to be modified according to the needs of the situation.

13
▪ A good organization modifies its principle, according to the need of its
organization. This justifies which nature of management?
1. Relative principles
2. Absolute principles
3. Universality management
▪ Management is a Universal Phenomena
1. True
2. False

14
▪ Production: This is generally put under production manager and he is responsible
for all production related activities.
Few of the activities under production are:
(1) Purchasing: which is related with the purchase of various materials required by
the organization. Purchasing involves procuring right quantity of materials at the
right quality, at the right time and at the right price from the right supplier.
(2) Materials management: This involves storing of materials, issue of materials to
various departments.
(3) Research and Development: It deals with improving the existing products and
process and developing new products and process.

15
▪ Marketing: This area involves the distribution of organizations’ products to the
buyers.
The sub-activities are:
(1) Advertising: Involves giving information about products to buyers.
(2) Marketing research: It is related with the systematic collection, analysis of data
relating to the marketing of goods and services.
(3) Sales management: It involves management efforts directed towards movement
of products and services from producers to consumers.

16
▪ Finance and accounting: It deals with intelligent investment of financial resources
and record-keeping of various transactions.
The various sub-functions are
(1) Financial Accounting: Deals with record keeping of various transactions.
(2) Management Accounting: Deals with analysis and interpretation of financial
records so that management can take certain decisions.
(3) Costing: It deals with recording of costs, their classification and analysis for cost
control.
(4) Investment Management: Takes care of how financial resources can be invested
in various alternatives to maximize returns.
(5) Taxation: Deals with various direct and indirect taxes to be paid by the
organization.
17
▪ Personnel: It deals with the management of human resources with the following
sub-activities:
(1) Recruitment and Selection: It deals with recruitment and selection of employees.
(2) Training and Development: It deals with training of employees and making them
more efficient.
(3) Wage and Salary Administration: Deals with fixing of salaries, job evaluation,
promotion, incentives etc.
(4) Industrial Relations: Deals with maintenance of good employee relations.

18
▪ People in an organization are
arranged in an hierarchy and they all
have the relationship of superior-
subordinates.
▪ There may be as many levels in the
organization as the number of
superiors in a line of command.
▪ Three categories – Top Management,
Middle Management and
Supervisory/Lower Level

19
▪ Top level management determines goals and objectives. It performs overall
planning, organizing, staffing, directing and controlling. It balances the interest
groups and is responsible for overall results.
▪ Middle management stands between top management and supervisory
management level. Middle level management establishes programs for
department and carries out functions for achieving specific goals. The other
functions of middle level management are training and development of employees,
integrating various parts of the department.
▪ Supervisory management is concerned with efficiency in using resources of the
organization. A supervisor is an executor of policies and procedures making a
series of decisions with well-defined and specified premises.

20
Early Management Approaches Functional foremanship:
Taylor’s Scientific Management ▪ Taylor introduced functional
foremanship for supervision and
Separation of planning and doing: direction.
▪ In the pre-Taylor era, a worker himself ▪ Under eight-boss-scheme of functional
used to decide or plan how he had to foremanship,
do his work and what machines and
equipment would be required to four persons: (i) route clerk, (ii)
perform the work. instruction card clerk, (iii) time and cost
clerk and (iv) disciplinarian are related
▪ But Taylor separated the two functions with planning function,
of planning and doing, he emphasized
that planning should be entrusted to and the remaining four: (vi) speed boss,
specialists. (vii) inspector, (viii) maintenance
foreman, and (ix) gangboss are
concerned with operating function.

21
1. Route clerk - He is responsible to specify the route of production.
2. Instruction card clerk - He is responsible to give instructions to the workers.
3. Time and cost clerk - He is responsible to prepare time and cost sheets.
4. Disciplinarian - He is responsible to maintain discipline among workers.
Under the production in charge, there are four personnel:
5. Speed boss - He is responsible for timely completion of job.
6. Gang-boss - He is responsible for keeping machines and tools ready for work.
7. Repair boss - He is responsible to keep machines and tools in proper working condition.
8. Inspector - He is responsible to maintain quality of work.

22
Elements of scientific management: Bilateral mental revolution:
The main elements of scientific ▪ Scientific management involves a
management are: complete mental revolution of workmen
towards their work, toward their fellow-
(a) Work study involving method and men and toward their employers.
time study.
▪ Mental revolution is also required on
(b) Standardization of tools and the part of management’s side–the
equipments for workmen and improving foreman, the superintendent, the
working conditions. owners and board of directions.
(c) Scientific Selection, placement and
training of workers by a centralized
personnel department.

23
Financial incentives: Economy:
▪ In order to motivate workers for greater ▪ Maximum output is achieved through
and better work Taylor introduced division of labour and specialization.
differential piece-rate system.
▪ Scientific Management not only focuses
▪ According to Taylor, the wage should on technical aspects but also on profit
be based on individual performance and economy.
and on the position which a worker
▪ For this purpose, techniques of cost
occupies.
estimates and control should be
adopted.

24
Taylor summed up his approach in these words:
▪ Science, not rule of thumb

▪ Harmony, not discord

▪ Cooperation and not individualism

▪ Maximum output, in place of restricted output

▪ The development of each man to his greatest efficiency and prosperity

25
▪ Fayol divided activities of business enterprise into six groups:

Technical, Financial, Accounting, Security, and Administrative or Managerial.

▪ He focused on this last managerial activity and defined management in terms of five
functions: Planning, Organizing, Commanding, Coordinating and Controlling.

26
▪ Division of work ▪ Unity of command
This is the principle of specialization which This is the principle that an employee
is so well expressed by economists as should receive orders from one superior
being necessary to efficiency in the only.
utilization of labour.
▪ Unity of direction
▪ Authority and responsibility
Each group of activities having the same
Authority is a combination of official objective must have one head and one
authority deriving from a manager’s official plan. Unity of direction is related to the
position and personal authority, functioning of personnel.
“Compounded of intelligence, experience,
moral worth, past services etc”. ▪ Subordination of individual interest
to general interest
▪ Discipline
In any group the interest of the group
Discipline is “respect for agreements which should supersede that of the individual;
are directed at achieving obedience, when these are found to differ, it is the
application, and outward marks of respect”. function of management to reconcile them.
Discipline requires good superiors at all
levels, clear and fair agreement, and
judicious application of penalties. 27
▪ Remuneration of personnel
▪ Scalar chair
Remuneration and methods of payment
should be fair and afford the maximum A line of authority, a ‘Chain of Superiors’
satisfaction to employee and employer. from the highest to the lowest ranks and
▪ Centralization
held that, while it is an error of
subordinate to depart ‘needlessly’ from
Refers to the extent to which authority is lines of authority, the chain should be
concentrated or dispersed in an short-circuited when scrupulous
enterprise. Individual circumstances will following of it would be detrimental.
determine the degree of centralization ▪ Order
that will give the best overall yield.
▪ Equity
‘Material order’ and ‘Social Order’.
This principle is one of eliciting loyalty “A place for everything (everyone), and
and devotion from personnel by a everything (everyone) in its (his) place”.
combination of kindliness and justice in Principle of organization in the
managers dealing with subordinates. arrangement of things and persons.

28
▪ Stability of tenure of personnel ▪ Esprit de corps
Instability is both the cause and effect Principle that ‘union is strength’ - an
of bad management, Fayol points out extension of the principle of unity of
the dangers and costs of unnecessary command.
turnover.
Fayol here emphasizes the need for
▪ Initiative teamwork and the importance of
communication in obtaining it.
Initiative is conceived as the thinking
out and execution of a plan.
Fayol exhorts managers to “Sacrifice
Personal Vanity” in order to permit
subordinates to exercise it.

29
Elton Mayo and others conducted ▪ Group dynamics
experiments (known as Hawthorne
experiments) and proposed the following: At the workplace, the workers often do not act
or react as individuals but as members of
▪ Social System group.
The organization in general is a social system The group plays an important role in
composed of numerous interacting parts. determining the attitudes and performance of
individual workers.
The social system defines individual roles and
establishes norms that may differ from those ▪ Informal leader
of formal organization.
There is an emergence of informal leadership
▪ Social environment as against formal leadership and the informal
leader sets and enforces group norms.
The social environment of the job affects the
workers and is also affected. ▪ Non-economic reward
▪ Informal organization Money is only one of the motivators, but not
the sole motivator of human behavior.
The informal organization does also exist
within the framework of formal organization Man is diversely motivated and
and it affects and is affected by the formal sociopsychological factors act as important
organization. motivators.
30
Behavioral Approach
1. Decision-making is done in a sub-optimal manner, because of practical and situational
constraints on human rationality of decision-making. The behaviorists attach great
weightage on participative and group decision-making.
2. Behavioral Scientists encourage self direction and control instead of imposed control.
3. Behavioral Scientists consider the organization as a group of individuals with certain
goals.
4. In view of behavioral scientists the democratic-participative styles of leadership are
desirable, the autocratic, task-oriented styles may also be appropriate in certain
situation.
5. They suggest that different people react differently to the same situation. No two
people are exactly alike and manager should tailor his attempts to influence his
people according to their needs.
6. They recognize that organizational conflict and change are inevitable.
31
▪ Quantitative approach (also known as management approach) started during Second
World War during which each participant country of the war was trying to seek
solutions to a number of new and complex military problems. The interdisciplinary
teams who were engaged for this purpose were known as operation research teams.
▪ These operation research teams developed quantitative basis for making military
decisions. These quantitative tools later are used to make business, industry and
enterprise decisions.
▪ The focus of quantitative approach is on decision making, and to provide tools and
techniques for making objectively rational decisions.
▪ Objective rationality means an ability and willingness to follow reasonable,
unemotional and scientific approach in relating means with ends and in visualizing the
totality of the decision environment.
▪ This approach facilitates disciplined thinking while defining management problems
and establishing relationships among the variables involved. This approach is widely
used in planning and control activities where problems can be defined in quantitative
terms. 32
Systems Approach
▪ A system is a set of interdependent parts which form a unit as a whole that performs
some function.
▪ An organization is also a system composed of four independent parts namely, task,
structure, people and technology.
▪ Central to the systems approach is ‘holism’ which means that each part of the system
bears relation of interdependence with other parts and hence no part of the system can
be accurately analyzed and understood apart from the whole system.
▪ A system can be open or closed system. In open system, a system interacts with
surrounding. An organization is open system because it interacts with it.

33
Contingency Approach
▪ According to this approach, management principles and concepts have no general and
universal application under all conditions.
▪ There is no best way of doing things in all conditions. Methods and techniques which
are highly effective in one situation may not give the same results in another situation.
▪ This approach suggests that the task of managers is to identify which technique in a
situation best contribute to the attainment of goals.
▪ Managers therefore have to develop a sort of situational sensitivity and practical
selectivity.
▪ Contingency views are applicable in designing organizational structure, in deciding
degree of decentralization, in motivation and leadership approach, in establishing
communication and control systems, in managing conflicts and in employee
development and training.

34
▪ Planning is deciding in advance what to do, how to do it, when to do it and who is to do
it. It bridges the gap from where we are and to where we want to go. It is in essence the
exercise of foresight.
▪ Planning is that function of the manager in which he decides in advance what he will do.
It is a decision making process of a special kind. It is an intellectual process in which
creative mind and imagination are essential.
▪ Planning is an attempt to anticipate the future in order to achieve better performance.

35
▪ Planning helps managers to think ahead.
▪ It leads to development of performance standards.
▪ Having to formulate plans forces management to articulate clear objectives.
▪ Planning makes organization to be better prepared for sudden developments.

36
▪ Planning is primarily concerned with looking into future. It requires forecasting the
future.
▪ Planning involves selection of suitable course of action. It means there are several
ways to achieving objectives.
▪ Planning is undertaken at all levels of the organization because managers at all
level are concerned with determination of future course of action.
▪ Planning is flexible. Planning involves selection of best course of action under
specific environment. If environment changes an adjustment is needed between
various factors of planning.
▪ Planning is pervasive and continuous managerial function.

37
Planning: A Rational Approach
▪ Planning is a rational approach for
defining where one stands, where one
wants to go in future and how to reach
there.
▪ A manager chooses appropriate means
for achieving the stated objectives,
rational approach fills the gap between
the current status and future status.
▪ The difference between two time periods
T1 and T2 may be as long as 5 years or as
short as one year.
▪ The desired and the current results are
usually expressed in terms of objectives,
which can be achieved by an action or set
of actions.
▪ The actions require resources and the
rational approach emphasizes on 38
appropriate use of resources.
Planning: An Open System Approach
▪ An organization is an open system because Flexibility of Planning
it accepts inputs from the environment and ▪ Flexibility is the ability to change direction
exports output to environment. to adopt to changing situations without
▪ Planning adopts an open system approach. undue cost.

▪ Open system approach indicates that the ▪ The plans must be flexible to adapt to
gap between current and desired status and changes in technology, market, finance,
the action required to bridge this gap is personal and organizational factors.
influenced by a variety of environmental ▪ Flexibility is possible only within limits,
economic, legal, political, technological, because it involves extra cost.
socio-cultural and competitive factors.
▪ These factors are dynamic and change with
time.
▪ Managers have to take into account the
dynamic features of environment while
using open system approach.
39
Pervasiveness of Planning
▪ Planning is pervasive and it extends
throughout the organization.
▪ Planning is the fundamental management
function and every manager irrespective
of level, has a planning function to
perform within his particular area of
activities.
▪ Top management is responsible for
overall objectives and action of the
organization. Therefore it must plan what
these objectives should be and how to
achieve them.
▪ A departmental head has to devise the
objectives of his department within the
organizational objectives and also the 40
methods to achieve them.
Primacy of planning:
▪ Planning is the first and foremost function
of management, other functions follow
planning.
▪ What is not planned cannot be organized
and controlled.

41
▪ To minimize risk and uncertainty

▪ To focus attention on objectives

▪ To facilitate control

▪ To increase organizational effectiveness

42
▪ Plans are classified into standing plans and single use plans.
▪ Standing plans provide guidelines for further course of action and are used over a
period of time.
▪ Standing plans are designed for situations that recur often enough to justify a
standardize approach.
▪ Example for standing plans : processing of bank loan applications.
▪ Once formulated these plans are in operation for a long period unless there is
change in these plans.
▪ Examples of such plans are organizational mission, long term objectives, strategies,
policies, procedures and rules.
43
▪ Single use plans are designed for specific end; when that end is reached, the plan
is dissolved or formulated again for next end.
▪ Examples of such plans are project, budgets, targets etc.
▪ Single use plans are generally derived from standing plans.
▪ Organization set their mission and objectives, out of which strategic actions are
determined. In order to put these actions into operations, projects, budgets etc., are
set for specific time period.

44
▪ Enterprises have a basic function or
task, which is assigned to them by
society. The mission or purpose
identifies this basic function or task of
the organization, for example the
purpose of university.
▪ Mission has external orientation and
relates the organization to the society in
which it operates. A mission statement
links the organization activities to the
needs of the society and legitimates its
existence.
▪ Purpose is also externally focused but
is relates the organization to that
segment of the society to which it
serves; it defines the business which
the company will undertake.

45
▪ Mission of HLL:

▪ Purpose of HLL:

46
▪ Objectives are the goals, aims or purposes that the organizations wish to achieve over
varying periods of time.
▪ It directs the actions of the manager.

▪ Objectives have the following characteristics:

1. Objectives are multiple in numbers

market standing, innovation, productivity, physical and financial resources, profitability, manager
performance and development, worker performance and attitude, public responsibility.

2. Objectives are tangible or intangible

3. Objectives have a priority
4. Objectives are generally arranged in hierarchy
5. Objectives some time clash with each other
47
▪ Requirements of sound objectives:
1. Objectives must be clear.
2. Objectives must support one another.
3. Objectives must be consistent with organizations mission.
4. Objectives should be consistent over period of time.
5. Objectives should be rational, realistic and not idealistic.
6. Objectives should start with word ‘to’ and be followed by an action verb.
7. Objectives should be periodically reviewed.

48
▪ Unified planning: Various plans are prepared at various level in the organization.
These plans are consistent with the objectives.
▪ Individual motivation: Objectives act as motivators for individual and departments
imbuing their activity with a sense of purpose.
▪ Coordination: Objectives facilitate coordinated behavior of various groups which
otherwise may pull in different directions.
▪ Control: Objectives provide yardstick for performance. The actual performance is
compared with standard performance and hence objectives facilitate control.
▪ Basis for decentralization: Department-wise or section wise objectives are set in
order to achieve common objectives of the organization. These objectives provide basis
for decentralization.

49
▪ Every organization has to develop plans logically from goals considering the environmental
opportunities and threats and the organizational strengths and weakness.
▪ A strategy is a plan which takes into account these factors and provides an optimal match
between the firm and external environment.
▪ Strategy formulation involves environmental appraisal and corporate appraisal.

Environmental appraisal involves identifying and analysis of the following factors:

1. Political and legal factors: Stability of government, taxation and licensing laws, fiscal
policies, restrictions on capital etc.
2. Economic factors: Economic development, distribution of personal income, trend in
prices, exchange rates etc.,
3. Competitive factors: Identifying principal competitors and analysis of their
performance, anti-monopoly laws, protection of patents, brand names etc.
50
▪ Corporate analysis involves identifying and analyzing company’s strength and
weakness.
▪ For example a companies strength may be low cost manufacturing skill, excellent
product design, efficient distribution etc.,. Its weakness may be lack of physical
and financial resources.
▪ A company must plan to exploit these strengths to maximum and circumvent it’s
weakness.
▪ The process of matching company’s strength and weakness with environmental
opportunities and threats is known as SWOT analysis.

51
Laxmi Chemicals Ltd., a soap manufacturing company, wanted to increase its market
share from 30% to 55% in the long-run. A recent report submitted by the Research &
Development Department of the company had predicted a growing trend of herbal
and organic products. On the basis of this report, the company decided to diversify
into new variety of soaps with natural ingredients having benefits and fragrances of
Jasmine, Rose, Lavender, Mogra, Lemon Grass, Green Apple, Strawberry etc. The
Unique Selling Proposition (USP) was to promote eco-friendly living in the
contemporary life style. The company decided to allocate 30 crores to achieve the
objective.

Identify the type of one of the functions of management mentioned above which will
help the company to acquire dominant position in the market.

52
Rahul, a worker, is given a target of assembling two computers per day. Due to his
habit of doing things differently, an idea struck him which would not only reduce the
assembling time of computers but would also reduce the cost of production of the
computers. Instead of appreciating him, Rahul’s supervisor ordered him to complete
the work as per the methods and techniques decided earlier as nothing could be
changed at that stage. The above paragraph describes one of the limitations of the
planning function of management. Name and explain that limitation.

53
▪ Josh Ltd. is a one of the largest two-wheeler manufacturer in India. It has a market
share of about 42% in the two-wheeler category. The company had witnessed
almost a 35% drop in the booking as the currency crunch was prompting people to
withhold new purchases due to demonetisation. Therefore, the production manager
of the company had decided to align production to factor in slower sales in the
market.
In context of the above case:
1.Identify and explain the function of management being discussed in the above
lines.
2.Which limitations of the function of management as identified in part (a) of the
question was the production manager trying to overcome due to demonetisation?

54
▪ General guideline for decision making
▪ According to George R Terry “ Policy is a verbal, written or implied overall guide,
setting up boundaries that supply the general limits and directions in which
managerial action will take place”
▪ Examples - recruitment policy, price policy, advertisement policy, dress code, internet or
computer usage

55
56
▪ Uniformity of action
▪ Predictable actions

▪ Speeds up decision
▪ Makes easier for the superior to delegate more and more authority to his
subordinates
▪ Directs the way in which predetermined objectives are to be attained

57
▪ Policies are carried out by detailed guidelines called procedures.
▪ A procedure provides a detailed set of instructions for performing a sequence of
actions involved in doing a certain piece of work.
▪ A procedure is a list of systematic steps for handling activities that occur regularly.

58
▪ A company may adopt a policy of centralized recruitment and selection through
labor department.
▪ The labor department may chalk out the procedure of recruitment and selection.
The procedure may consist of several steps like inviting application, preliminary
interview aptitude and other tests, final interview, medical examination and issue of
appointment orders.

59
▪ They indicate a standard way of performing a task.
▪ They result in simplification and elimination of waste.
▪ Procedure improves the efficiency of employees.
▪ Procedure serves as a tool of control by enabling managers to evaluate the
performance of their subordinates.

60
▪ Prescribed way in which one step of procedure is to be performed.
▪ It is an established manner of doing an operation.
▪ Medical examination is a part of recruitment and selection procedure, method
indicate the manner of conducting the medical examination.
▪ Increases the effectiveness and usefulness of procedures.
▪ By improving methods better productivity and lower costs can be achieved.
▪ Methods can be improved by eliminating wastes by conducting “motion study”.

61
▪ Operating in an orderly way
▪ Rules are detailed and recorded instructions that a specification must or must not
be performed in a given situation
▪ Demands strict compliance
▪ Examples – sanctioning overtime wages, sanctioning traveling bills etc

62
▪ Sequence of activities directed towards the achievement of certain objectives
▪ Action based and result oriented
▪ Definite steps which will be taken to accomplish a given task
▪ Lays down the time to be taken for completion of each step
▪ Time phasing and budgeting
▪ Example – Sales promotion programme, Training programme

63
▪ Drafted for a particular period of time
▪ A budget is a statement of expected results expressed in quantitative terms i.e.
rupees, man hours, product units etc
▪ An instrument of managerial control
▪ Sales budgets, production budgets, cash budgets, and revenue and expenses
budgets

64
▪ Two years ago, Madhu completed her degree in food technology. She worked for
sometime in a company that manufactured chutneys, pickles. She was not happy in the
company and decided to have her own organic food processing unit for the same. She
set the objectives and the targets and formulated an action plan to achieve the same.

One of her objectives was to earn 10% profit on the amount invested in the first year. It
was decided that raw materials like fruits, vegetables, spices, etc. will be purchased on
three months credit from farmers cultivating only organic crops. She also decided to
follow the steps required for marketing of the products through her own outlets. She
appointed Mohan as the Production Manager who decided the exact manner in which the
production activities were to be carried out. Mohan also prepared a statement showing
the number of workers that will be required in the factory throughout the year. Madhu
informed Mohan about her area wise sales target for different products for the
forthcoming quarter. While working on the production table, a penalty of Rs 100 per day
for not wearing caps, gloves and apron was announced.

Quoting lines from the above paragraph, identify and explain the different types of plans
discussed.
65
1. Objectives: Objectives are the end results of the activities that-an organisation seeks to achieve through
its existence. All other activities within the organisation are directed towards achieving these objectives.
“One of her objectives was to earn 10% profit on the amount invested in the first year.”
2. Policy: A policy is a set of general guidelines that helps in managerial decision making and action.
“It was decided that the raw materials like fruits, vegetables, spices, etc. will be purchased on three
months credit from farmers cultivating only organic crops.”
3. Procedure: A procedure contains a series of specific steps to be performed in a chronological order to
carry out the routine activities.
“She also decided to follow the steps required for marketing of the products through her own outlets.”
“The exact manner in which the production activities are to be carried out.”
4. Rule: A rule is a specific statement relating to the general norms in terms of Do’s and Dont’s that guide
the behavior of people. It commands strict obedience and a penalty is likely to be imposed on its
violation.
“While working on the production table, a penalty of Rs 100 per day for not wearing caps, gloves and
aprons was announced.”
5. Budget: A budget refers to a financial plan that is expressed in numerical terms.
“Mohan also prepared a statement showing the number of workers different products for the
forthcoming quarter.”

66
▪ Two years ago, Mayank obtained a degree in food technology. For some time, he worked in a
company that manufactured bread and biscuits. He was not happy in the company and
decided to have his own bread and biscuits manufacturing unit. For this, he decided the
objectives and the targets, and formulated an action plan to achieve the same.

One of his objectives was to earn 50% profits on the amount invested in the first year. It was
decided that raw materials like flour, sugar, salt, etc. will be purchased on two months credit.
He also decided to follow the steps required for marketing the products through his own
outlets. He appointed Harsh as the Production Manager who decided the exact manner in
which the production activities were to be carried out. Harsh also prepared a statement
showing the requirement of workers in the factory throughout the year. Mayank informed
Harsh about his are a wise sales target for different products, for the forthcoming quarter.
While working on the production table, a penalty of Rs150 per day was announced for not
wearing the helmet, gloves and apron by the workers.

Quoting lines from the above paragraph, identify and explain the different types of plans
discussed.

67
1. Objectives: Objectives are the end results of the activities that an organization seeks to achieve through
its existence. All other activities within the organization are directed towards achieving these objectives.
“One of his objectives was to earn 50% profit on the amount invested in the first year.”
2. Policy: A policy is a set of general guidelines that help in managerial decision making and action.
“It was decided that the raw materials like flour, wheat, sugar, etc. will be purchased on two months
credit.”
3. Method: A method refers to the prescribed ways or manner in which a task has to be performed
considering the objective.
“..decided the exact manner in which production activities were to be carried out.”
4. Procedure: A procedure contains a series of specific steps to be performed in a chronological order to
carry out the routine activities.
“He also decided to follow the steps required for marketing of the products through his own outlets.”
5. Rule: A rule is a specific statement relating to the general norms in terms of Do’s and Dont’s that guide
the behaviour of people. It commands strict obedience and a penalty is likely to be imposed on its
violation.
“While working on the production table, a penalty of Rs. 150 per day was announced for not wearing
helmets, gloves and aprons by the workers.”

68
▪ Establishing goals/objectives
▪ Determine the enterprise objectives
▪ Set by upper level managers after number of objectives has been carefully considered
▪ Depends on factors like mission of the organization, ability of the organization etc
▪ Once the organizations objectives are determined, the section wise or department wise
objectives are planned at the lower level

69
▪ Establishing planning premises
▪ Establishing the conditions under which planning activities will be undertaken
▪ Planning assumptions— the expected environmental factors, pertinent facts and
information relating to the future such as general economic conditions, population trends,
competitive behavior etc

70
▪ Internal and External premises
▪ Internal premises include sales forecasts, ability of the organization in the form of
machines, methods of design, behavior of the owners and employees etc.,
▪ The external premises exists outside the enterprise and include general business and
economic environment, technological changes, government policies and regulations,
population growth etc.,

71
▪ Tangible and Intangible premises
▪ Population growth, industry demand, capital and resources invested etc., are tangible
premises
▪ Political stabilities, sociological factors, attitudes and behavior of the owners etc., are
intangible premises.
▪ Controllable and non-controllable premises
▪ Non-controllable factors are strikes, wars, natural calamity, legislation
▪ Controllable factors are availability of resources, skill of managers and labor etc.,

72
▪ Deciding the planning period
▪ Lead time in development and commercialization of a new product
▪ Time required for recovering capital investment or the pay back period
▪ Length of commitment already made

73
▪ Identification of alternatives
▪ Example: If a company has to grow what has to be done?

▪ Evaluation and selection of alternative

▪ Developing derivative/supportive plans
▪ Measuring and controlling the process

74
▪ According to Louise A Allen, “Organization involves identification and grouping
of activities to be performed and dividing them among the individuals and creating
authority and responsibility relationship among them for the accomplishment of
organizational objectives”.
▪ Organizing consists of departmentalization, linking of departments, defining
authority and responsibility and prescribing authority relationships. The
organization structure is the result of this process.

75
▪ Organization is always related to certain objectives
▪ An organization connotes a group of people
▪ Communication is the nervous system of organization
▪ Organizing is a basic function of management
▪ Organization is a continuous process
▪ Organization connotes a structure of relationship (formal and informal)
▪ Organization involves a network of authority and responsibility relationship

76
▪ To facilitate pattern of communication
▪ To allocate authority and responsibility
▪ To locate decision centers
▪ To create proper balance (emphasis of activities)
▪ To stimulate creativity
▪ To encourage growth

77
▪ Line, Military or Scalar Organization
▪ Vertical relationship through which authority flows

78
79
▪ Simplicity
▪ Quick decision and speed of action
▪ Unity of control
▪ Clear division of authority and responsibility
▪ Discipline and better coordination
▪ Direct communication

80
▪ The organization is rigid and inflexible
▪ Being an autocratic system, managers may become dictators and not leaders.
▪ There is scope of favoritism and nepotism.
▪ Red-tape and bureaucracy.
▪ Lack of specialization

81
▪ The specialists are made available in the top positions throughout the enterprise
▪ Functional authority remains confined to functional guidance of different
department

82
83
▪ Specialization.
▪ Reduces the burden on the top executives.
▪ Offers greater scope for expansion.
▪ A functional manager is required to have expertise in one function only.

84
▪ Violates principles of unity of command.
▪ It develops specialists rather than generalists.
▪ Lack of coordination among functional executives which delays decision making.

85
86
▪ Specialized knowledge
▪ Reduction of burden on line managers.
▪ Better decisions, as staff specialists help the line managers
▪ Unity of command

87
▪ Allocation of duties between line and staff is not clear.
▪ There is generally conflict between line and staff executives.
▪ Since staff is not accountable, they may not be performing well.
▪ Difference between orientations of line and staff. Line executive’s deals with in
problem in a more practical manner while staff, tend to be more theoretical

88
▪ A committee is a group of persons performing a group task with the objective of
solving certain problems
▪ Committees help in taking corrective decision, coordinating the affairs of different
departments and meeting communication requirements in the organization
▪ Committee classification
▪ Advisory
▪ Executive

▪ Advisory committees have only a recommender’s role and cannot enforce

implementation of their advice or recommendation.
▪ Works committees, finance committees etc.,

▪ Whenever committees are vested with line authority, they are called as executive
committees
▪ Board of Directors etc

89
▪ Committees provide a forum for the pooling of knowledge and experience of many
persons of different skills, ages and backgrounds.
▪ Committees are excellent means of transmitting information and ideas both
upward and downward.
▪ Committees are impersonal in action and hence their decisions are generally
unbiased and are based on facts.
▪ When departmental heads are members of committee, people get an opportunity
to understand each others problems and hence improve coordination

90
▪ In case a wrong decision is taken by committee, no one is held responsible which
may results in irresponsibility among members
▪ Committees delay action
▪ Decisions are generally arrived at on the basis of compromise and hence they are
not best decision
▪ As committee consists of large number of persons, it is difficult to maintain secrecy

91
▪ Filling and keeping the positions in
the organization with the right
people is the staffing phase of the
management function.
▪ Staffing involves the determination
of manpower requirements of the
enterprise and providing it with
adequate competent people at all
levels.

92
▪ Manpower planning
▪ Recruitment
▪ Selection of the best qualified from those who seek job
▪ Training and Development
▪ Performance appraisal and compensation

93
▪ Recruitment is the process of
identifying the sources for
prospective candidates and to
stimulate them to apply for the
jobs.
▪ It is a linking activity that brings
together those offering jobs and
those seeking jobs.
▪ Recruitment refers to the attempt of
getting interested applicants and
providing a pool of prospective
employees so that the management
can select the right person for the
right job from this pool.

94
▪ Internal Sources
▪ External Sources

95
▪ Transfer involves the shifting of an
employee from one job to another.

96
▪ Higher jobs are filled by promoting
employees who are considered fit for
such positions.
▪ Filling higher positions by promotion
motivates employees, boosts
employee’s morale.

97
▪ Direct recruitment
▪ Unsolicited applications
▪ Advertising
▪ Employment agencies
▪ Educational institutions
▪ Labour contractor
▪ Recommendations

98
▪ Employment of persons having the
ability and qualifications to
perform the jobs which have fallen
vacant in an organization.
▪ Choosing the right type of
candidates to man various positions
in the organization.

99
▪ Receipt of applications
▪ Screening of applications
▪ Employment tests
▪ Intelligence tests, Aptitude tests, proficiency tests, personality tests, interest tests etc.

▪ Interviews
▪ Background investigation and medical examination
▪ It serves to ascertain applicant’s capabilities to meet the job requirement.
▪ It serves to protect organization against the unwarranted claims under workman compensation.
▪ It helps to prevent communicable diseases entering the organization.

▪ Final selection

100
1. Define management. Explain the functions of management?
2. Explain the levels of management. Specify the responsibilities at each level.
3. Planning precedes all management functions. Elaborate.
4. Explain the contribution of F. W. Taylor and Henry Fayol to the theory of
management./ Explain any two modern management approaches.
5. Explain the steps in planning.
6. Explain the various types of plans.
7. Explain the process of recruitment and selection.
8. Differentiate between Line Organization and Line & Staff Organization.
9. Discuss whether management is an art, science or profession.
10. What are committees? Explain its types with examples.

101