I Nature of Management

Theme
T o understand the conceptual framework ofmanagement and its rela-
tionship to administration.
T o identify the nature of management in terms ofit being science or art
profession, and its universal applicability.
T o understand how management concepts can be applied to practices
and making management effective.

Contents
O Concept of management
Management as a discipline
Management as a group of people
Management as a process
Management and administration: a terminologicalconflict
Importance ofmanagement
Nature ofmanagement
O Management: science or art

Management as profession
Professionalisation ofmanagement in India

O Universality of management
Applying management theory in practice
Effective management
Effectiverness and efficiency

Effective manager

Organisational knowledge is absolutely critical to building, preserving, and leveraging institu-

tional excellence. It is like the air you breathe-you cannot measure it, touch it, or see it but no
organisation can survive without it.
Keki B. Dadiseth, former Chairman
Hindustan Lever Limited
Excellence is not just a skill; it is an attitude too.
Anonymous
 PRACTICE OF
MANAGEMENT
NATURE OF MANAGEMENT
AND
PRINCIPLES

of 5
areas
to as an
has become
o n e of
the most important in the
rected
identifiable flow of information
through interrelated stages of analysis di
present context,
managing
of large and complex
organisations
the atten-
towards
rather
the achievement of an objective or set of objectives. It is
ne because of increasing
role have attracted dynamic than static existence in which events
and
a
concept of

continuous, and flexible, and such, must relationships

organisations
t a n activity of their increasing role, the the answer of the question as dynamic, must be
seen
Because to find out as be considered whole.
has led to the develop-
as a
ety academicians Thus,
n
practitioners and
of both effective.' This af management as a
process includes various activities and
subactivities. How-
be made more over the period ever, what these
t e s e organisations
can

known as management.
It has grown activities are must be defined
precisely to understand the exact
of study
a new field context, it has emerged as o n e of the most
important disciplines nature and of
scope management. In a simple way, we can define
what managers do. However, management
this definition, though simple, suffers from
as
intoday's
a and tions: two limita-
of study research.
1. There is a problemin identifying the
people in the organisation
who can be
Concept of Management doia called as managers because there is no uniformity in the titles given to the

discipline should start with its

definition delineating properly its people. For example, people may be called as president, chief executive or mana-
ne study of a and prescribing the ging director at the top level. Similarly at the middle level, they can be called as
contents and characteristics, defining its scope and boundary,
we can proceed only
when
objectives for which it stands.
From thËis point of view,
of is not so executivetoor accountant,isand at lower level as supervisor. Therefore, it becomes
we define management. However, a precise 'definition management
a variety of ways. Being
a new difficult as identify who a manager and who
whose activities
is not; whose activities should be

Simple because the term management is used in

of disciplines such as treated managerial and
should be studied is not clear.
as non-managerial.Thus, what
discipline, it has drawn concepts and principles from a number so on. The result is
and
economics, sociology,
that each group psychology,
of contributors
anthropology, statistics
has treated management differently. For example,
2. Even if the problem of identifying people as managers is solved, the problem of
identifying managerial activities still exists because people known as managers
production; sociologists
of have
economists have treated management as a factor may perform different kinds of activities, some of which may not really be
treated it as a class or group of persons; practitioners have treated it as a process managerial. Therefore, unless some yardsticks are prescribed to distinguish bet-
all these divergent groups view the nature ween managerial and non-managerial activities, managerial activities cannot be
comprising different activities. Naturally,
own point of view. Thus, taking all these points
of
and scope management from their identified.
of view together, it becomes difficult to define management in a comprehensive way.
In the present context, the term management is used in three altermative ways: In order to overcome these limitations, the total activities of
an
organisation can
be divided into two groups: operational and managerial. Those activities which
which actua work is accomplished such as han-
1. Management as a discipline, are of operative nature through
2. Management as a group of people, and dling a machine by workers, putting the materials into godown, etc.,
are
called
activities. As against this, some activities are performed to get things
3. Management as a process. operational
done like a supervisor instructing a worker to do a particular job, or marketing
to contact the customers to sell
the product, etc.
Management as a Discipline manager instructing his salesmen
Such activities are different from the first group and are known as managerial
Discipline refers to a field of study having well-defined concepts and principles.
defined as the process of getting things done
When we refer to management as a discipline, we include in it
the various relevant activities. Thus, management can be defined
invariably as the process of 'getting things
concepts and principles, the
knowledge
of which aids in managing. From this by others. Management
of view, management can be treated either point where we are to where we want
done through the efforts of others',ofgetting from and efforts', or 'coordinating
as an art
or science, the two basic and time, money,
broad disciplines. However, since
management prescribes various principles and to be with the least expenditure
toward superordinate goals'. Though these
defini-
how these principles can be applied in
managing an organisation, it has the orienta- individual and group efforts different terms, all of them convey the same
tion of both, science and art, a phenomenon which will be tions of managenment as process use
discussed later in this the problem of defining manage-
chapter set of eanings in their final analysis. However,
because of the existence of different approaches in
ment as a process is not over
Management as a Group of People orientations have been adopted in defin-
this context too. Historically, four such
Sometimes, refer
we to
management as a group of people in which we include all ing management process:
those personnel who
pertarm managerial unctions in
organisations. For example,
when we talk about relationship berween 1. Production or efficiency oriented,
tion, refer
we to two distinct managemernt and labour in an
organisa-
the first category, we include classes
or 2. Decision-oriented,
groups ot personnel in the
all those
persons who are organisation. In 3. People-oriented, and
functions and in the secona category, We responsible for managerial
approach of using management is qure popular; nclude non-managerial personnel. This 4. Function-oriented.

purpose of defining the term management. however, it does not serve our Those who have put forward the
Production or Efficiency-oriented Definitions. have viewed that
Management as Process efficiency in organisation
of
concept of management as a source
a
efficiency in organisational settings. For
In studying
studying management is concerned with generating defined
matly disCpine, we generally refer to manacem
be defined
management of development of management, Taylor has
example, in an early stage
A proce oement process canas systematic method of
complex handling
be management as follows:
treated as a activities. How
which one
can be referred
 NATURE OF MANAGEMENT
PRACTICE OF MANAGEMENT
PRINCIPLES AND 7
then seeing that it is These definitions, no doubt, offer
want to do and
anagement is the art knowing
of what you ment though these do not specify the better explanations of the nature of manag
done in the best and cheapest way of getting things dorne by or with the functions or activities involved in the process
cooperation of
Function-oriented Definitions. These definitionsother people.
terms ot securing maxi-
In a similar way, John Mee has defined management in
results when he views that: unctions pertormned by managers in put emphasis on the various
these functions in different definitions.organisations
mum
though there is no uniformity in
results with minimum effort so aas
maximum
For example, McFarland states that:
Management is the art of securing
for both employer and employee "Management is defined for conceptual, theoretical, and
to
secure maximum prosperity and happiness that which
process by analytical purposes
as
and give the public the best possible service." managers create, direct, maintain and operate purposive
efforts and results as
organisations through systematic, coordinated, cooperative human efforts.
Both these definitions emphasise on relationship between Henry Fayol, early management thinker, has elaborated these functiorns more
an
can be
of management but do not specify how these objectives precisely when he defined management as follows:
the objectives
achieved. To that extent, these definitions do not offer exact explanation of the na-
"To manage is to forecast and to
ture of management. plan, to organise, to coordinate and to control."
Decision-oriented Definitions. Decision-oriented definitions management have
of Function-oriented definitions of management are more relevant for understand-
been provided by decision theorists who have seen management process in terms of ing the exact nature and Scope of management inspite of the fact there is no
decision making. For example, Peter Drucker,
a
noted management has thinker, unanimity over various functions. From this point of view, we can define manage-
viewed that the life of a manager is a perpetual decision-making activity. Whatever a ment as follows:
manager does, he does only through decision-making. Decision-making power pro- Management is a process involving planning, organising, staffing, directing., and
vides a dynamic force for managers to transform the resources of business or-
ganisations into a productive, cooperative concern. These decision theorists have
controlling human efforts to achieve stated objectives in an organisation.
emphasised the role of decision making in management to such an extent that one of Features of Management
them has viewed that "management means decision making." A more formal deci- In the light of the above discussión and definition, basic features of management can
sion-oriented definition of management has been provided by Stanley Vance as fol-
lows:
be identified which are as follows:
1. Organised Activities. Managementis a process of organised activities. Without
Management
tion human
issimplyforthethe
process of decision making and control over the ac
organised activities, two groups of people cannot be involved in the performance of
goals.5
of beings expressed of
purpose attaining pre-determined activities. Where a group of people are involved in working towards a common

The decision-oriented definition of objective, management comes into existence. The organised activities may take a
management indicates that the basic activity variety of forms ranging from a tightly structured organisation to a very loosely-knit
of manager is to make decisions and enforce these decisions. However, this does
a
organisation. It can be a company like Tata Iron and Steel Company or a local social
not provide the
processes in which context decision making applied.
is club. But all organisations have one thing in common; they want to progress effi-
the coordinated efforts
People-oriented Definitions. In this group of definitions, management is defined ciently towards the achievement of their objectives, through where a single individual
as a process of coordinative eftorts of people in organisations. Various authors have of people. This is done by management process. Therefore,
emphasised the role has no operational meaning. However,
of people
in the
organisations.
They have viewed that manage- pursues his personal objectives, management
ment is the direction of people and not of things; management is the individual's quest for personal objectives
ment; and so on. manage- personnel when a n attempt is made to channel the overall objectives of the group, management
Lawrence
Appley has called management as
management and has defined it as follows: personne along the lines that contribute to
becomes the means which the random action is controlled.
by
"Management is the accomplishment of results 2.Existence of Objectives. An objective or set of objectives should exist towards
through the efforts of other
directed. Without objectives, it becomes
People. which the organised group activities are
activities would lead to. The
to define the direction where organised group
difficult
Koontz has defined management in similar way when he says that: human organisation because all
existence of objectives is a basic criterion of every
deliberate and purposive creation and, therefore, they should have
"Management is the art of getting things done through and with organisations are the members of the group or thee
mally organised groups." people in for- SOme objectives. The objectives
are agreed upon by
of affairs which an
are the desired state
organisation. The organisational objectives is sought through the
This realisation of objectives
Frederick W. Taylor, Scientific Management, New York: Harper Brothers, 1911. Organisation attempts to realise.
2ohn F. Mee, "Management Philosopny for Frofessional Executives," Business Coordinated efforts of the people constituting an organisation.
P. Horizons, December 1965, Organised activities achieve com
meant to

Peter F. Drucker, Management Tasks, Responsib1lities and Practices, New York:

. Relationship Among Resources. establish certain relationships among
the available
about to
Harper & Row, 1974.
William E. Moore, The Professions: Roles and Rules, New York: Basic Books. 1978 on goals are brought machine, materials, and people. All these
re-

Stanley Vance, Industrial Administration, New York: MeGraw-Hill, 1959. Tesources. Resources include those
money,
who manage; they apPly
knowledge, experience,
Lawrenoce A. Appley, "Managementtnenpiestay," Personnel, Vol. 19, No. 4, pp. O u r c e s are made available to
7Harold Koontz, "The Management Lneoy 595-603. Macmillan, 1974, p. 6.
p. 174.
jge Joural of Academy of Management, December 1961, Principles and Practices,
New York:
1.
aton E. McFarland, Management Management, London: Sir Issac Pitman, 1949, p.
* n r y Fayol, General and Industrial
 PRINCIPLES AND PRACTICE OF NAGEMENT
NATURE OF MANAGEMENT
of management is 9
desired results. Thus, the essence
principles for getting the
resources. However,
since
gra-
people at operative leveid Administration is Above
Management
of various organisational AcCording many
to
different functions classical
tion and other resources, it 1s
more important fo thinkers, administration is above
the things by the use of various physical
the management to take care of integration
of human resources. Ihus, management the in
organisation
ministration and management activitiesareareconcerned. managemernt so
They perceive that bothtar as
ofhuman resources which, in turn, utilis nerformed by sngle different though both of them may ad-
is concerned with the proper utilisation a

Oiver Sheldon, Williamindividual in be

other resources. organisation.
an
Prominent among them are
4. Working with and Through People. Managemernt involves working
with peo- The general view 1s that Spriegal, Milward, Lansberg, Ordway Tead, Florence, etc.
administration
achieved through them. The idea of work. ment relates to policy execution and theserelates to policy
formulation and manag
ple and getting organisational objectives of to subordinates. The ple,Spriegal states that: two activities are not the same. For
ingthrough people is interpreted in terms assigning activities exam
created because of organised activities.
superior-subordinate relatiornships are
Through the process of assignment and reassignment of activities, the actual work is "Administration is that phase of a business enterprise that concerns itself
at the operative level which is the lowest level in an organisa- overall determination of institutional objectives with thee
performed by people relates to how human followed in achieving those objectives.
and the
policies necessary to be
tion. Thus, a sizeable proportion of management principles
beings can be put for better efforts in the organisation.
Management,
executive function which is primarily concerned
on the other
hand, an is
with carrying out broad
laid down by the administration. policies
5. Decision-Making. Management process involves decision-making at various

levels for getting things done by others. Decision-makingbasically involves selecting Similar view has been expressed by Milward when he states
thé most appropriate altermative
out of If is
theseveral. there
only one alternative, that
Ehe question of decision-making does not arise. The quality of alternativ which a "Administration is primarily the process and agency used to establish the
manager selects determines the organisation's performance, and the entire future of tive or purpose which an undertaking and its staff are to achieve, objec
the organisation rests on the degree to which the right decisions are made by mana- secondly,
ministration has to plan and to stabilise. the broad lines or principles
ad-
which wil
gers. Therefore, the success or failure of managers can be judged by the quality of govern action. These broad lines are usually called policies. Management is the
decisions that they make. process and agency through which execution of policy is planned and super
There are various elements of management process. These are generally classi- Vised.12
fied as planning, organising, staffing, directing and controlling. The coordinated
This phenomenon has been shown by Figure 1.1.
performance of these leads to the realisation of organisational objectives. This aspect
of management process will be discussed in Chapter 3.

Top
MANAGEMENT AND ADMINISTRATION:
A TERMINOLOGICAL CONFLICT Administration
(policy formulation)
Before we proceed further to analyse the nature of management, it is desirable to
resolve the terminological conflict
there is often
between management and administration as
a
terminological
conflict between the two. Some authors suggest
that there is no fundamental difference between
management and administration,
whatever difference between the two exists, it exists
in different walks of life. Other authors
only in terms of their usage
suggest that these two terms are different
and involve different sets of activities.
Therefore, resolution of this conflict is
necessary. Management
(policy execution)
At the initial level of
made between
development of management thought, no distinction was Lower
management and administration and both the terms were used inter- Functions in organisation
changeably. In 1923, the terminological conflict between the two terms was raised by
Olver Sheldon in his book "The
administration as decision-making function and
Philosophy of
Management'when he emphasised
management as execution func managerial functions
FIGURE 1.1: Administrative and
tion." After that, this distinction
between the two terms was
and the
terminological conflict emphasised by many administration determines the basic
The basic approach of these authors is that
regard have led to the emergenceproceeded
further. Various views expressed in this
functions are undertaken
of three which managerial
approaches: amework of the organisation within with different
1. different, different types of persons
Administration is above management; unce these sets of functions areBased on this approach, various authors have sug-
2. sets of qualities are required.
Administration is a part of management; and administration and management
as shown in
3. gested the difference between
Management and administration are same. Table 1.1.
London: Sir Issac Pitman, 1957,
1lwil Organisation and Operation,
10Oliver Sheldon, The Philosophy of a m R. Spriegal, Principles of Business
Management, London: Sir Issac Pitman, 1923. 12 .548.
New York: John Wiley,
1960, p. 34.
lward, An Approach to Management,
 PRACTICE OF MANAGEMENT NATURE OF MANAGEMENT
PRINCIPLES AND
10 11

Difference between
administration and management affairs." Thus there is difference between
no
TABLE 1.1: example, McFarland, who made distinction managernent and administration. ror
tion in an earlier edition of his between management and
Basis of difference
Administration
Management
to make distinction between
book, revised hís stand and viewed that itadministra
is
Top level
Middle and lower level
each other." Thus, management management and administration; both are difficult
1. Level in organisation and administration are similar to

Policy formulation
and Policy execution for between the two terms lies mostly in their syrnonymous; the difference
2. Major focus objective achievement
objective determination
fields of human organisations. For example, usage different
in countries difterent or

Determinative Executive "The British conception seems to be

Lepawsky has made observation
that
3. Nature of functions the general
Broad and conceptual
Narrow and operational European usage which
agement given broader meaning than administration. In American man
is a
in
4. Scope of functions
Mostly intermal administration includes management usage
5. Factors affecting decisions Mostly external
The distinction between the two terms
and
organisation.
Employees may be drawn by analysing the
6. Employer-employee Entrepreneurs and
the word administration. Its origin is found origin ot
relation Owners
ment or in regulation of some laws. The
in the bureaucratic structure of govern
Administrative Technical government often uses the word
7. Qualities required administrator, instead of manager, to handle and manage its affairs. In law also,
administrators are appointed to look after the estate of a deceased person. While
the fact that
The classical authors on management appear to be influenced by handling the government affairs, administrators are to execute the broad policies
administrative process in non-business activities was well developed as compared to laid down by the government, though they may also participate in policy formula-
most of the early contributors to tion. Similarly, the estate administrators keep intact the property and manage the
management. It can be seen in the next chapter that
studied managerial in the business organisations com- estate according to some specific mandates of law. On the other hand,
management thought process
management
paratively at lower levels whose primary responsibility was to execute what was is normally used in business sphere. However, whether administration is used
decidedby higher-level management. Therefore, they could perceive the functions of non-business fields and management is used in business field ofdoesthe not make a
management as limited to lower levels only. The only exception came from Henry fundamental distinction.between the two because of similarity process in
Fayol who studied the entire management functions and never distinguished be-
tween management and administration.
volved in these. In fact, even this distinction is also disappearing, For example, many
authors have written books under the title ""Business Administration" which implies
Administration is a Part of Management that these books would be used by persons acquiring knowledge to be utilised
There is another school of thought which treats management as more comprehensive
handling business affairs. Similarly, many institutions offering management courses
offer M.B.A. degrees for their management graduates while others offer M.B.M.
function which includes administration also. For example, Brech has viewed man
agement and administration in the following way:
degrees for the similar type of students. Thus, in practice, the difference between the
two is disappearing fast.
"Management is a generic name for the total process of executive control in indus-
try or commerce. It is a social process entailing responsibility for the effective and
The basic point of controversy between management and lies in
administration
terms of coverage of activities. The controversy arises because people call the various
economical planning and regulation of the operation of an enterprise, in the fulfil- level management functions differently. For example, the contents of management
ment of a given purpose or task. Administration is that part of management which functions in terms of policy formulation and execution can be as follows
presented
is concerned with the installation and carrying out of the procedures by which it is Some call the formulation function as administration, others call it management.
laid down and communicated, and the process of activities regulated and checked However, both are functions, as shown in Figure 1.2
management
against plans."13
If this view is accepted, administration becomes a subordinate function to over- Top
Policy formulation
all managenment functions. From this point of view, administration isconcerned with
day-to-day function and is a part of management.
ccording to this approach, the
previous analysis, that is, administration is above
management, stands completely
reversed.

Management and Administration are Same Middle

According to the third approach which is the most popular and practical one, man-
agement and administration are same. Both involve the same functions, principles
and objectives. For example, while speaking at the Second International of
Administrative Science, Fayol, one of the most important early thinkers Congress
on manage
Policy executon

ment thought, has said, "all

undertakings require planning, organisation, command,
coordination and control, and in order to function
Lower
Management functions
properly, all must observe the
same general principles. We no longer confronted with several administrative
are
sciences but with one which can be aPplied equally well to public and private FIGURE 1.2: Management
functions at different levels

13E.F.L. Brech, Principles and Practice of Management, London: Pitman,

1972, p. 29. 4McFarland, op. cit.
15 Dert Lepawsky, Administration, New York: Alfred Knopf, 1949.
 PRACTICE OF MANAGEMENT NATURE OF MANAGEMENT
PRINCIPLES AND
12 13
may not
be required to pertorm two combined output. For
yarious pressure groupsexample,
in the case of
be suggested that two sets of people business organisation, there are
all manageral runctions, only
a
may Everyone performs
such as
s O management functions. The content of policy tormulation is shareholders, employees, government,
interest groups nave pressure on an erc. ne
dtive importance of these functions varies.
lower at lower levels
while execution 15 otherwise. Society, more such pressure is the organisation. In more advanced and complex
on
a

gner at higher levels, it is formulation function is known as pressures from various organisation. Management has to balance these
interest groups.
whether policy
eretore, it becomes unimportant reason why
most of the contemporary
or management. This is the 5. Stability in the
ddministration Society. Management provides stability in the
authors try to avoid this age-old controversy. changing and modity1ng the resources in society Dy
of the society. In the modern age, moreaccordance with the changing environment
IMPORTANCE OF MANAGEMENT betterment of human beings. These inventions emphasis is on new inventions for the
lives of people in groups
since long. obsolete and inetticient. Management providesmake old systems and factors
mostly
Management hás been important to thethedaily has been so important for new inventions, and integration between traditions and
herefore, a question is raised that if management sateguards society from the unfavourable impact of these
importance in the present-day society.
The ínventions so that continuity in social process is maintained.
human lives, why it has assumed added be traced in the context of emergence of large
PoSsible answer of this question can
has become much more
SIZed organisations. The management of these organisations
the size, another dimension Natúre of Management
complex than what it used to be earlier. Alongwith
which has added to the complexity of managing is the changing nature of society
and its various constituents. Therefore, the issue before the present-day managers
is The study and application of management techniques in managing the affairs ofthe
how to take care of these changes so that organisations achieve their objectives. organisation have changed its nature over the period of time. Though management
has become crucial not only for the organisations but for the as a practice came long ago, in fact, with the existence of human
Thus, managementclassical groups themselves,
writers on management has recognised its importance its impact as a formal body of knowledge has been felt much later,
society too. Even particularly
long back. For example, Urwick has commented that: during the last five-six decades. Various contributions to the field of management
have changed its nature, for example, from merely a practice to science also.
"No ideology, no ism, or political theory can win greater output with less efforts
Simi-
larly, other changes have also occurred. Thus, the nature of management can be
from a given complex of human and material resources, only sound management. described as follows:
And it is o n such greater output that a higher standard of life, more leisure, more

amenities for all must necessarily be found." 1. Multidisciplinary. Management is basically multidisciplinary.
that, although management has been developed as a separate discipline, it draws
This implies
The importance of management may be traced in the following contexts: knowledge and concepts from various disciplines. It draws freely ideas and concepts
from such disciplines as psychology, sociology, anthropology, economics, ecology,
Resources. Management
1. Effective Utilisation of tries to
make effective utilisa: statistics, operations research, history, etc. Management integrates the ideas and
tion of various resources. The resources are scarce in nature and to meet the demand concepts taken from these disciplines and presents newer concepts which canbe put
should maximum for the general interests of the
of the society, their contribution be
into practice for managing the organisations. In fact, the integration of knowledge of
society. Management not only decides in which particular altermative a particular various disciplines is the major contribution of management and this integrated
resource should be used, but also takes actions to utilise it in that particular alterna discipline is known as management. Therefore, the contributions in the field can be
tive in the best way. human beings.
expected from any discipline which deals with some aspects of
2. Development of Resources. Management develops various resources. This is 2. Dynamic Nature of Principles. Principle is a fundamental truth which
true with human as aswell non-human factors. Lawrence Appley
of people." However, most of the
has emphasised establishes cause and effect relationships of a function. Based on integration
and
that management is the development researches has framed certain principles.
for resource development are carried on in an organised way and management is Supported by practical evidences, management and change with the changes in the
However, these principles are flexible in nature
involved in these organised activities. Thus, through the development of resources exists. Because of the continuous
management improves the quality of lives of people in the society. environment in which an organisation older principles are being changed by new
development in the field, many in
3. To Incorporate Innovations. Today, changes are occurring at a very fast rate in researches are being carried on to establish principles
principles. Continuous be as a final truth. In fact, there
is
both technology and social process and structure. These changes need to be incorpo can regarded
the
Changing society and no principle of management.
rated to keep organisations alive and eficient. Business
organisations are moving nothing permanent in the
landslide
from primitive sophistication. Therefore, they
to require high degree of specialisa-
tion, high level of competence, and complex technology. All these require efficient Principles. Management
not Absolute principles are relative,
not
3. Relative, the need of the organisation. Each
be applied according to
dDsolute, and they should
management so that organisations work in the most efficient way. because of time,
The difference may exist
different from others.
4. Integrating Various Interest Groups. In the organised etforts, there are various oganisation may be individuals working within
the same
Place, socio-culturalfactors, etc. However, has different
interest groups and they put pressure over other groups for maximum share in the differ. Thus,
a particular management principle
OTganisation may also of management should be
Therefore, principles
in different conditions. must be made for different
rengths conditions. Allowance
Lyndall F. Urwick, Elements of Administration, New York: Harper Brothers, 1943. of prevailing
"Appley, op. cit.
PPied in the light
changing environment.
 OF MANAGEMENT NATURE OF MANAGEMENT
14 PRINCIPLES AND PRACTICE
15
whether management is aThe deduction of specific
4. Management: Science or Art. There
is a controversy
both a science and an art. This will be
The recasting of the
hypotheses
from the
theory;
sCience or art. However, management is 4. hypotheses
quired to test the hypotheses;
in terms of
specific measures and the operatiorns
elaborated later.
Management has been regarded
as a profession by 5. devising of actual situation to test the theorem; and
The
.
Management as Profession. of a profession.
while many have suggested that it has not achieved the status The actual testing in which confirmation does does not
many
This aspect has been discussed in detail later.
or
occur.
Management as Science
is a universal phenomenon. How-
6. Universality of Management. Management be modified Tudging from the above features of formulation of theory in science,
ever, management principles are not universally applicable but are to will be dis- cannot be regarded as science because it is only half-way. management
of management It may be called 'inexact
according to the needs of the situation. Universality Science or pseudo-science. Perhaps this is true for all social sciences of which
cussed later is this chapter. anagement is a branch. Management is not as exact as natural or physical sciences
The nature of management suggests that it is a multidisciplinary phenomenon are. This phenomenon can be explained asfollows
relative and not absolute. It is both science and art; it can be
its principles are flexible, the last three aspects need
as a profession and finally it is universal. However, 1, Science may be viewed in terms of its structure, its goals, and its methods. In
taken elaboration because of differing views over these aspects of management.
further terms of its structure, it is a number of scientific disciplines: physics, biology,
psychology, economics, management and many others. Each of these sciences
MANAGEMENT: SCIENCE OR ART attempts to provide a set of internally consistent hypotheses, principles, laws,
as to whether it is a
The controversy with regard to the nature of management, much in the air
and theories dealing with an aspect of total knowledge. To the extent a science is
or an art, is very olad. This corntroversy, however, is not very mature, such internal consistency may be attained but there are many young
SCience of exact nature of manage-
though the controversy is yet to be settled. Specification sciences like management that only approximate this state.
ment as science or art or both is necessary to specify the process of learning of
science differs from that of 2. One of the most important rules of science is that concepts have to be defined
managenment. It is to be noted that the learning process in
art. of science basically involves the assimilation of principles while learn-
Learning
clearly in terms of the procedures involved in their measurement. One has to
know exactly what one is talking about while using a particular term. Meanings
ing of art involves its continuous practice. have to be clear and unambiguous to avoid confusion and erroneous classifica
Much of the controversy of management science or art is on account of thee
as
tion. However, in management, various terms are not used in the same way andd
fact that the earlier captains of industry and managers have used intuition, hunches, and organisation
They were not trained giving same meaning. Even the major terms like management
commonsense, and experience in managing organisations.and had developed com-
are used in different ways. The reason for this phenomenon is quite simple.
brilliant
professional managers, although they were very Since the second decade of the last century, a number of disciplines
have
monsense which
through well. Commonsense and science differ in
they managed These disciplines have
claimed to contribute to human knowledge of managing.
the following ways: almost unfathomable
been immature to be a science. The consequence has been
ambivalence in using the
Commonsense is vague as compared to scientific knowledge. confusion over the various terms, a confusion in which
1.
consis- various terms has played a conspicuous part.
2. Flagrant inconsistency often appears in commonsense whereas logical so that causation may be imputed
tency is the basic of science. 3. In science, observations must be controlled
method of eliminating a given factor as possible
Science systematically seeks to explain the events with which it deals;
common-
3. correctly. The most common
it from varying so that it cannot
sense ignores the need for explanation. cause of an event is to hold it
constant-to keep
This is a difficult rule to follow, specially
in
The scientific method deliberately exposes claims to the critical evaluation
of operate as a source of change.
4 method fails to test conclusions in any
Various research studies in management
experimental analysis; commonsense
studying organisational phenomena.
bias of researchers. In many studies, for example,
a
scientific fashion. have suffered because of the influence.
found to exert a causal
to be irrelevant w a s
Science is based on logical consistency, systematic explanation, critical evalua-
variable that was thought factors that must be controlled
and to developP
However, the effort to identify To the extent that this
effort is
tion and experimental analysis. Thus, science can be defined as follows: procedures to accomplish
this is a continuing one.
and hence valid explanation,
and reasoning,
Science is a body of systematized knowledge accumulated and accepted with
of
successful, reliability perception
reference to the understanding of general truths concerning a particular phenome- is possible. contirmation. Scientific
non, subject, or object of study. in terms that permit empirical samne result.
of repetition with
Theories in science are
testable and the tests are capable c o n s i s t e n t with other explana-
Thus, science is a systematized body of knowledge. The process of scientific statements are statements are logically of total
theory construction and confirmation can be viewed as involving the following urthermore, explanatory confirmed. Thus, rationality
been frequently
statements that have this does not happen
in management
steps: Tory maintained. However, evidences and are
Sclentific system is lack empirical
management principles under varying
1. The formulation of a problem or complex of problems based on observation; of the
exactly. Many do not give similar results
these principles doubt, attempts
are
not testable. Further, universal application. No
2. The construction of theory to provide answers to the problem or problems based therefore, lack basis of scientific obser-
o n the
on inductions from observations Conditions and, in management
evolve principles
Deing made'to
 OF MANAGEMENT NATURE OF MANAGEMENT
PRINCIPLES AND PRACTICE
16 17
universal application, but still the process is in an another scores b grade, it does not
and
vations which may have
are not evolved, management cannot anager than the latter. This is so becausemean that the isformer would be a better
evolutionary stage. Until
such principles
acer is one who knOws how to apply the management an art and a better
man
Management is an art can be seen from theknowledge solving a particular problem.
be called a science in its true
sense. in

above suggest that management

is not a pure following facts:
The various factors analysed is so because management
'inexact science'. This 1. The process of management does involve the use of
science but it can be simply called it bears partial know-how and skills like
also makes use of scientific methods
in evolving principles. Therefore, any other art such as music, painting,
have suggested that with greater use sculpture, etc.
characteristics of science. In fact, many people 2. The process of managemernt is directed to achieve certain
the direction is towards more and concrete results as
of mathematics and statistics in management, other fields of art do.
This is true but it must be remembered that
more use of true science in management.
mathematics, rather mathematics is being used to . Management creative like any other art. Creativity is a major dimension
is
in
management is not becoming
management. Mathematics is basic managerial success. It creates new situations for further improvement.
a
decide issues in
explain, codify, and help to it is basic to the
abstract science. It is fundamental to other sciences. For example, 4. Management is personalised meaning thereby that there is no 'one best way of
mathematics that is the sciernce of management but managing. Every person in his profession has individual approach and tech-
study of physics. But it is not the and
the use of mathematics in relating understanding the activity of mangement. nique in solving the problems. The success of managerial task is related with the
The knowledge consists in how and where to use mathematics in solving issues of personality of the person apart from the character and quality of general body of
managerial difficulty. Science may contribute to the solution of managerial problems knowledge.
and relevant to the problem may be brought
in two ways: (i) existing research theory
to bear on its solution; and (ii) where sufficient
time is available, research may be
to guide solution
Management: Both Science and Art
conducted to provide information not previously available and Thus, to be a successful manager, a person requires the knowledge of management
accordingly. As the body of scientific knowledge bearing However,
on management process principles and also the skills of how the knowledge can be utilised. Absence of either
second ap-
increases, the first approach may receive wider application. will result in inefficiency. A comparison between science and art is presented in
because of the widespread time pressure on
proach may have limited application rele- Table 1.2 which suggests that a manager requires both aspects of management to be
decision-making for problem solution. The observation of E.F.L. Brech is quite successfu.
vant in this context:

of man- TABLE 1.2: Comparison between science and art as

"That systematic body of knowledge underlies the competent practice
a
used in management
today would deny; and much of that knowledge lies in
agement, hardly anyone
summation of
various fields which are of themselves academic disciplines. The
such parts cannot constitute a n e w science. What the advocate really means is that Science Art
in management necessitates both an adequate basis of knowledge and
competence Advances by practice
a mature scientific approach; they do not mean
that management is at par with Advances by knowledge
nuclear physics. "l8

Proves Feels

Management as an Art Guesses

of art is related with the Predicts
Management can be regarded as an art also. The meaning skills. Whereas under science,
of desired result through the application of
bringing a Describes
one learns the 'why' of a phenomenon, under art, one learns the 'how' of it. Art is Defines
thus concerned with the understanding of how particular work can be accom- Opines
or of expertness Measures
plished. That is, art has to do with applying of knowledge or science
in performance. This is specially important in management because in many in- Expresses
stances, much creativity and adroitness in applying the managerial efforts are neces Impresses
the adequate consideration of
sary to achieve the desired results. Furthermore,
people involved in managerial action is vital and adds to the concept of the art of art in man-
uses both
scientific knowledge and
be seen that management
lt can increases so should the
art of
managing8
Science and art an organisation. As the
science of management
are complementary fields of endeavour; they are not mutualy
of of
gng between the two is
needed. Neither should be overweighed
exclusive. The medical doctor requires the knowledge science chemistry, biol-
ogy and anatomy. But excellence in absorbing these funds of knowledge does not
anagement. A balance further
Some feel that gains in science of management
fact
will restrict art
remains that to be
Sighted. extent only. The
to apply his wealth of knowledge true to a limited be present. Therefore,
make him an excellent physician. He has expertly, r e and more. This is must be applied,
that is, art must should
and his skill in perceiving how and when to use his knowledge is essential his science
to E, knowledge or
true. The correct saying
thes a y i n g that 'knowledge is power' partiallyabundant knowledge may have
is
success in preventing and controlling diseases of mankind. Therefore, knowledge 1s
not the sole qualification. Similarly, in management, if one student scores A grade is power.' People having is particularly true
for
1 Pplied knowledgedo not know how to use
knowledge. This
if
u s e they phenomenon.
Brech, op. cit., pp. 26-27. nagement which is a situational
 PRACTICE OF MANAC
18
PRINCIPLES
AND
GEMENT NATURE OF MANAGEMENT
19
etudied for
being successful professional. This is true for all
a
Management as Profession
anagement. Management has been developed professions including
does it not posse
rer the last five-six distinct body of knowledge
as a

as profession by
many, although
find out whether man
all the decades. The
development of knowledge in management e
Management is regardedTherefore, it is desirable to ent is has been due to the need for managing
features of a profession.
of meanings, a complex and large organisations in a better
has been given variety way. Thus, management satisfies the requirement
a

a profession. The
word profession
to it. example,
characteristics
in a n early dofer
For
ofprofession
existence ot knovwieage. 1owever, the concept of management
a in the formot
is still evolving and
ent people
attach different
that a profession "may perhaps
be defined a s an o c occup continuously neW principles are being developed though this does not affect its
Carr-Saunders claims intellectual study and training, the purpose of whickon status as being a profession.
based upon specialised fee o r salary.""1 In a c sto
or advice to
others for a definite
supply skilled service that a profession is
"a vocation whosea 2. Acquisition of Knowledge. An individual can enter profession only after
a
ac-
tively recent definition, Cogan suggestsof a theoretical structure of s o m e denard quiring knowledge and skils through formal training. For example, only law gradu-
is founded upon an understanding ates can enter the profession legal practice. A professional is one who practises a
of
tice definitions merely mplyto
Both of these professions
that
of learning of science." valuable society. Howa professionupon
and is regarded as an expert since he has mastery of specific branch of
a
manner, service occupations and, therefore, iearning which his Occupation is based so that he may offer service to his
in some out the characteristics of a profession. Houle
these definitions do not bring c a n be associated client. However, the emphasis is put on the initial acquisition of knowledge through
suggested that there are atleast fourteen characteristics that some formal method. From this point of view,
the dynamic process of corporate improvement within the occupation (profe management cannot be regarded as a
rofessi
onalisation). These characteristics are: definition of the occupation's functions, mas profession because the entry to the managerial cadre ín an organisation is not limited
to management graduates only, though it can be said that management graduates
tery of theoretical knowledge, capacity to solve problems, use knowledge, self-en.
of
can put in better pertormance in the organisation because of their familiarity with
hancement, public acceptance, ethical practice, penalties, relations to other vocations
the various techniques of management.
relations to the users of the service While Houle places these characteristics along
a number of different axes-conceptual, performance and collective identity charac 3. Professional Association. An occupation which claims to be a profession
teristics-he does not really define the concept of professiorn itself. As against these shouldhave an association. A professional association consists of firms and individ
characteristics, McFarland has given five characteristics of profession. These are: the uals whose membership is based on common professional, scientific, or technical
existence of a body of knowledge or techniques, formalised methods of acquiring aims. The representative body of professionals is needed to regulate and develop the
training and experience, the establishment of a representative organisation with pr0
fessionalisation as its goal, the formation of ethical codes for the guidance of con
professional activities. The body may also prescribe the criteria for individuals who
want to enter the profession. In the field of management, there are associations at
duct, and the charging of fees based on services but with due regard to priority of various levels. For example, in India, there is All India Management Association
service over the desire for monetary reward. with its local chapters in most of the cities. Similarly in foreign countries also, there
The various approaches of defining the characteristics of profession without are associations of managers. However, managers do not belong to a single, unified
really defining it is dangerous because characteristics may be added to or subtracted professional group like Indian Medical Council for medical practitioners or Bar
from any existing list by any author without
any theoretical rationale. Therefore, an Council of India for legal practitioners. Instead, individuals and firms affiliate with a
operational definition of profession may be given as followS: variety of interest groups falling into two categories: the trade associations, and the
Profession is
occupation for which specialised
an professional, occupational, scientific,
or technical
interest. This is true throughout the
required and the use of these skills is not meantknowledge,
are
skills and training world. From this point of view, management cannot be termed as true profession.
for self-satisfaction but
are used for
larger interests of the society and the success of the use of these these
is measured not in terms of
money alone. skills 4. Ethical Codes. For every profession, some
ethical standards are provided
and every individual of the profession is expected to maintain conformity with
Thus, all professions these standards. The need for ethical codes arises because of the fact that occupa-
occupations in the sense that they provide
livelihood; however, all occupations
are
tions whose practitioners have mastery over an area of knowledge have a degree
are means
certain characteristics of profession. Thenotvarious
professions because some of them of power by virtue of their expertise and this power can be used for the benefit of
characteristics of profession dla
a
be: (i) existence of
organised
an
and in many occupations
the professionals at the cost of the society. This has resultedclients
method of acquisition of knowledge;systematised
(ii)
body of knowledge; (1 1Ssuing a code of ethics of professional practice so that may know the
fessionalisation as its goals; (iv) formulation ofexistence of an
association wiu standard and commitment that they should receive from a professional.
In man-
Let us discuss the ethical cocles;
extent which all these characteristics areand (v) service mou
to has been formulated to suggest the behavioural
to determine
whether found in manage agement also, a code of conduct there is a lack of universally accepted
1. Existence
management is profession or not. pattern for professional managers. Though the in most of the countries, man-
etnical codes for managers throughout world,
that there is of Knowledge. A profession emerges from the a r e supposed to be socially responsible,
and it is their duty to protect the
a
body of
knowledge which cannot of fact gers
be skirted establishment with an These parties may be cus-
around but nds to be erest of all parties associatedfinanciers, organisation.
creditors, government, and the general
AM. ners, suppliers, employees,
Press, Carr-Saunders, codes in management is not much preva-
The
1928. Profess ions: Their Organisation and Pubic. However, the practice of ethical
20M.L. Cogan, Toward Definition as the management association
is not
Place in the absence of any controlling body
C.O. Houle, Continuing
a
of Society. London, Oxrord larenden n
in profes-
Profession,"
Mckarlarnd, op. cit., p. 22.Learming the Professions, San
in Harvard Educational y representative of the professional managers. In fact,
India, many
All
Fransisco: Jossey Review, Winter 1955. not even aware of the code ot conduct tormulated by
Bass PublisherS, 0. managers are
Tndia Management
1 Association.
 AND
PRACTICE F
OF MANAGEMEN
PRINCIPLES
NATURE OF MANAGEMENT
20
ethical code provides the
behavioural pattern for profan 21
Service Motive. While that professionals should keep
sociai int of management; (1) growing emphasis on the ethical behaviour of managers;
a
5. suggests It is essenhiat the increasing ()
motive concept
sionals, service while charging fees for their protessional
services.
number and
use of
management consultants; and (v) the large number
in their mind cannot be measured easily in Hh of management associations.
est value of professional
service
professionals then Management, however, does not control
because the monetarymechanism except the
competition among the entry in the manner as many of the old
absence of market to charge higher fees by virtue of established profesSions do but the
educational
selves. Since the professionals are in position
a
value
for their service, the provide similar consequernce. Moreover, therequirement
a
professional
of future managers may
status of
their expert knowledge, hence associating
high monetary should not be
viewed in the context of controlled management
measured not in terms
of money it earns but by tho entry. This be against the
Success of any profession is
This is true for management
also. Management development of management itself. For example, Drucker has may observed that, "No
amount of social service it provides. greater damage coula be
contribution in the society by way of integrating done to our economy or to our
society attempt than to to
is an integrating agency and its for the stability of the professionalise management by licensing managers by limiting access to or
into productive units is very important ment to manage
various resources
cannot be measured in terms of people with special a
academic degree. Anytoserious attempt to make
society. This important contribution management
of management scientific or a profession is bound to lead the attempt to eliminate
resources worth
alone because without the integrating effort of managenment, those disturbing nuisances, the unpredictability of business life-its risks, its
money ups
millions of rupees may be useless. and downs, its wasteful competition, the irrational choices of consumer-and, in the
process, the economy's freedom and its ability to grow. Drucker believes that eco
Management as Emerging Profession nomic pertormance and achievement are the proper aims of management and since
certain characteristics of a manager's primary responsibility is to manage, he should not devote time to activi-
The above discussion shows that management possesses
Therefore, it cannot be said to be a profession, ties such as
protessionalisation which lie outside, rather than within, the
profession while others are missing.
it is as a profession and the move is towards management as While this has certain merit, Drucker has used the
organisation.
though emerging concept of manage
profession. For example, Reiss has classified profession into five categories and has ment as
profession in
a very sense. At
strict
centre the of professional aspect of
suggested management as a would-be profession. According to him, five different management are the attitudes of managers toward their work.
types of professions in contemporary industrial society are as follows:
Professional Approach in Management. Management as a profession should not
be defined in terms of the characteristics of a well established profession like medi-
1. Old established professions-founded upon the study of a branch of learning,
eg, medicine. cine or in
law entry is regulated based on qualifications, but in terms of the
which
approach that is adopted by managers in managing the organisations. From this
2. New professions-founded upon new disciplines,eg, chemists, social scientists.
point of view, the key considerations in professional management are as follows:
3. Semi-professions--based upon technical knowledge and practice, e.g., nurses,
1. Commitment to professionally defined knowledge and techniques.
teachers, social workers.
4. Would-be professions-familiarity
with modern practices in business etc. and 2. Application of relevant moderm management tools and techniques.
aspiring to achieve professional status, e.g., personnel directors, sales directors,
3. Team approach in managing rather than emphasis on personal styles, whims,
engineers, etc.
and prejudices.
5. Marginal professions-based upon technical skill, eg, technicians, draughts 4. Preparedness to accept change and to apply the principles of change manage-
men.
ment.
Management is being professionalised. The concept of professionalisation 5. Preference for competence rather than birth as the basis for movement in the
be used to refer to the dynamic process whereby many occupations can be may
to change crucial observea organisational ladder.
characteristics in the direction of a
may not move very far in this direction. There are profession even though these to optimise the benefits to the
certain stages in the
6, Optimisation-oriented decision making expected
occupation into profession. has suggested that the first transition or
an
organisation and its constituents.
transition is the establishment ofCaplow stage in this
occupational title. A code of ethics professional
a
is
association, followed by a change Responsiveness to the society and respectfor national policies.
the occupation,
which is published which portrays the social
utility O
occupation. He points out followed by legislation restricting
with this go the specific practices to t
facilities and the control ofthat concurrently PROFESSIONALISATION OF MANAGEMENT IN INDIA

the
admission to
training and entry intodevelopment of traing has become a glamorous expression in corpo-
occupation controls every aspect of the profession. Thus, ne term 'professional management' takes
committees of its professional association." training and practice through various su ate management in India. There
is so much fascination that every company
even though some-
fast moving towards From this point of itself as professionally-managed
view, management a e of pleasure in decorating
tion in
management protessional status. The main
are tound in five areas of implications of professionalisa in
nes total disregard to its professiornal attainment. The concept of professional
of progressive and etficient management
and
organised, systematised body of knowledge; (i) the development: (i) the growth o agement has become synonym inefficient, there is obvious craze for the
evolution of professional schoo- ce no one likes to be called
backward and
arises: to what
title. However, the question
23 A.J. Reiss, Occupations and p a o n of professional management
24T. Caplow, The Sociology ofSocial
Work, Status, Glancoe: Free Press, 1955.
Minneapolis: University of
Minnesota Press, 1954.
Drucker, op. cit., pp. 9-10.
 NATURE O F MANAGEM EMENT
PRACTICE OF MANACE
PRINCIPLES AND EMENT repreneurs have enjoyed the
fastest
22 1o assess the present s t s much of this growth has growth so far but this is not sustainable
been professionalised? studies have been cOn Of come at the cost of
extent has Indian
management not many Indian private secto largely dominated by
destroying value The ..

of Indian management,
which Indian management
haed family capitalism,
rhaul governance structure. From feudal lordships, must
its change and
professionalisation
the extent to they must change to
Theresearch is required to find out
of management
as
a profession are fen n t the governance mechanisms of modern
corporations."
basic characteristics education in man
professionalised. The Facilities of formal
in varying degrees.
in Indian management Association, growing divorce of many public sector organisations, the situation is no better. It is an
All India Management
ment, establishment of a code of conduct by Al
nd
and formulation of ted fact that
managers many public sector organisations, particularly at
in
ership and management, that there is professionalisatiorn
of management
accelevels, often greatly borrow the traits of bureaucracy,
Management Association suggest of Indian management. At
the same tim justeven the
h t e Sector managers carry a tamily or business house traits, top level
though they
as

India. However, this is not the total picture two contrasting views need furthe
These
it is labelled as traditional management. P the facade ot proressionalisation. Many top level public sector managers
elaboration. From this point of view,
Indian management can be divided into tu hav orked, lived and imbibed the government way of working. This seriously
professionally-managed sector.
parts: traditionally-managed sector and mes in the way ot initiative, innovativeness and flexibility so essential for
co1sector organisations. Sometimes, civil servants, military personnel, and
Traditionally-managed Sector politicians whe
who do not have commensurate professional competence are
In common parlance, Indian management is described as 'family management' with Pnointed to head public sector organisations. In such a case, one hardly expects
aDrofessionalisation at the lower levels also. Therefore, it can be suggested
traditional values'. The two distinguished featuresinofthe
family management are: (i)
hands of the members of Lin many private sector and public sector organisations, there is lack of
and control of the organisation are
both ownership
the family, and (i) organisational objective is to maximise profit even if it necessi-
that
rofessionalisation of management. Management, being a key factor in the
individual
tates exploitationof the weaker sections society.
of the This type of management ronomic development of the country and developmenttheofmain
maintains the control of the organisation by value system of the family and often, of professional content in it has been one of reasons
organisations, lack which
there is great variation between the management styles of two organisations con- of these
for the unsatistactory pertormancecould not be organisations. The technology
use in the
trolled by two different families. Organisational and managerial style has been re- has been so frequently imported put to the best possible
tained by the family structure at the peak of the organisational pyramid and relative absence of commensurate professional management
support. The basic reasons
organisational positions of the family members are determined in accordance with follows:
for lack of professional management
are as

their positions in the family. In majority of cases, power is personalised in a close-

knit group tied with familiar which checks the emergence of
relationship. Even in the areas where professionals 1. There appears to be attitudinal conservatism
manage to percolate, the managers are allowed to play only secondary role because belief that busine_s is a matter of com-
of the limitations professional management. The popular attitude has paid good dividends
posed by the decision-making process. In this context, P.L. Tandon, monsense and luck reflects this attitude. This
and lack of competition, and profit,
an eminent a
management expert, observes that, in the past because of controled economy situation is
has been assured. However, the
"In a
family business, you
have professional engineers, accountants and market- major yardstick of business success, of managing8
ers, but all fast with increasirng size of organisations, complexity
decision-making is cerntralised at the top, with the head of the family, changing environment. But very few business owners
who has no
professionalism, but perhaps only experience and intuition, the deci business, and more competitive of managing
to the old concept
sions are not
likely to be as good as that of a modern professional board." have realised this fact and others are clinging
The claim of some business.
show.
ment is not true because organisations
the mere
that they have
professionalised their manage- 2. Most of the organisations in the private
sector are generally
one-man

true not only

appointment of some with professional functions of a manager. This is
Often the owner also performs the
degrees will not
necessarily lead to professionalisation of persons
management unless there also for the large ones even though they
is change in management process. In this context, L.C.
a for the small-scale organisations but
Gupta, a as joint stock company
form of organisations. Gener
educationist, observes as follows: management might have been organised but real control lies in
to fulfil the legal requirement
"Professionalisation does not come ally the board is constitutedwho is an entrepreneur conceives the enterprise and

professional degrees, automatically by employment of people with a single person. The

owner
functions, his perspective
unless the
professionals have the necessary authority brick by brick. When he performs managerial
use their
professionalism in and builds it Owner-manager's style of func-
decision-making.
technocrats in the purchase and
We
may employ MBAs and other Is quite different from the professional manager.
in m o r e direct control and often
sales centralised and he believes
through family firms, where departments,
but if
be done
is the
buying and selling are to tioning is normally of management.
scope of
professional degrees what matters is professional professionalism? More than discourages professionalisation
ethics."r of public sector enterprises
have put pressure
In a more recent . The emergence and development for these enterprises. These
comment, Sumantra Ghoshal, considered on the government to
find out suitable managers
who had altogether
guru, has observed as follows: to be
management from the civil services
were originally deputed
managers of functioning. This style percolated throughout
different perspective and style sector could not develop right type
of managerial
26p.L. Tandon, Professional the organisation and public
Management in India, Ludhiana: Department of Business
Agricultural University, 1974. Economic Times, April 2,
LC. Gupta,
"Pseudo-pros, Feudal Ways", Economic Times, May 31, 1986. Management, Punjab "Family Capitalism
must Change," The
8G
mantra Ghoshal and Abhijit Mandal,
1999, pp. 1-2 (Supplement),
 NATURE OF MANAGEMENT
PRINCIPLES AND PRACTICE OF
24 MANAGEMENT 25
the professionalisation of manaoe The market has not
remained protective and competition-free. The
culture. This has also worked against
in this respect is changing because the nt has undergone sea-change.
a
It may be technology
in public sector. The situation
a suitable management cadre for ffectiven the observed that family management 1s
ment has now realised the need for is eary stages of economic development. However,
sector. ganisation grows beyond certain size, changes
a
in the nature of
once an or
process in it
demand that oWnership and managerial
management posinons should be held by management
Business in India has not yet reached the level of sophistication as in th. should be divorced; that
developed countries requiring the use of sophisticated tools and techniguee and adequate training. persons who have professional skills
Western standard, the Indian business is still in its infancy. In the absenc
By
of proper development of business, the management pattern has also not While the above two factors have generated the need for
developed. In fact, many sectors are still undermanaged. In such a case, there
is very little scope for professionalisation of management in these sectors.
availability of traned and educated professional managersprofessionalisation,
has facilitated the
of
process protessionalisation of
management. After the Second
Year Five
Plan, there has been
increasing emphasis management education. Today,
on
Professionally-managed Sector there are many Institutes of Management at Ahmedabad, Kolkata,
As against traditionally-managed sector, there are various organisations, both in Lucknow and other places which impart full-time management Bangalore,
education.
private sector as well as in public sector, whose management is highly pro There are, many management departments at various universities
fessionalised. There are numerous such companies like Hindustan Lever
ofterinS
Limited full-time management courses. Besides, there many institutions and or-
are
ITC Limited, British Oxygen Limited, ganisations which run short-term management development courses. Promi-
Steel Company, TELcO, and so on in
Infosys Technologies, Wipro, Tata Iron and
private sector and Bharat Heavy Electricals nent among these are: Administrative Staff College of India, Management
Limited, Oil and Natural Gas Commission, Indian Oil
sector. These Corporation, et., in public Development Institute, National Institute of Bank Management, National
Productivity Council with local Productivity Councils, All India Management
companies have inducted management
graduates at various levels of
management, introduced modern concepts of management, set Association with local chapters at about forty places, National Institute for
tives conducive to social organisational
needs, and motivated their personnel to achieve objec Training in Industrial Engineering (NITIE), etc. These bodies organise man-
of professional
competence. The number of organisations falling in this
high level
increasing day by day. In fact, managers in this sector can be category is agement development programmes of the duration ranging from 2 days to 12
compared with their weeks. In many business organisations
addition, also have established their
counterparts in Western countries in terms of application of modem management development centres. Prominent among these are: Steel Author-
techniques, attitudes towards management practices, and management ity of India, Life Insurance Corporation, most of the commercial banks,
concepts suitable for the country. The main reasons for the developing management Rashtriya Chemicals and Fertilizers Limited in public sector and Tata Iron
sector are as follows: professionalisationin this
and Steel Company, TELCO, Hindustan Lever, ITC Limited, etc., in private
1. The most important factor sector. In fact, development
of managers some form of
through ex external
agement is the internationalcontributing
It can professionalisation
to of Indian man-
impact. be observed that modern posure is given high priority in many organisations. Even comparatively
ment concepts were first introduced by the subsidiaries and manage smaller organisations are also sending their managers to short-term manage-
multinationals operating in India. associates of ment development programmes. This has resulted in a change in the perspec-
evoked mixed reactions in Indian However, adoption of such techniques
able admiration for the corporate sector. While there was consider tive of old owner-managers.
were not in tune with systems, there were many who believed that that management in India is marching fast to-
Indian context. They they The above discussion suggests
Western concepts in Indian
business and
questioned the validity of these
social wards professionalisation, though large part of it isofstill
a traditional. However, in
of these subsidiaries context. However, since of marnagement is likely to be
and associates were
growth and profitability, it was assumed quite successful in terms of many
their
the time to come, the process professionalisation
of managing business which is not possi-
because of the that the success was taster because of the increasing complexity
application partly at least because of increasing availability of
complexity of business
of such
systems. With the increase in size and ble
for traditional management and also
adopted the sophisticatedorganisations of Indian
origin, many of them also
management techniquues. The sheer necessities of
professionally-trained managers.
managing large and
traditional way of complexthesebusinesses resulted in the
re-examination of the Universality of Managemen
2.
managing businesses.
Professionalisation of is about the universality of
pulsion. For example, management
the
in certian sector
has been
sector increased manifold because of comn-
Another controversy which exists in management commanded world-
periods. With the failure ofpublic nanagement. As the area of management has increasingly
attempt of inducting during
the initial the plan the question whether it is science with universal
a
managers in the public sector
non-professional wIde interest and recognition, and practitioners alike. Settlement of this con-
induct enterprises,
professional managers in these the
government took decision to
a Ppication has concerned scholars knowledge
professionalisation of enterprises with the responsibility TOversy is necessary to determine the extent to which managerial
paved the way for the entire
managerial cadre and of
can be transmitted to other countries. If it is universal,
Eveloped in one country
enterprises. In the professionalisation process. This its
of has of management knowledge. However, in
same
place, when the management in many Lereis no problem in transferability
owner-managers werepublic sectopr knowledge
on the universal
use of management
manage the organisations because of increasing not able to asence, there is serious question
quently complexity of management, they competition and conse- developed in a country. that transmission of
managers. Over period,
a
there has yielded way to the The concept of universality of management
suggests man-

been professional
transformation of Indian business. Eement knowledge may be
undertaken:
 PRINCIPLES
AND
PRACTICE

ng in
in
MANAGEMENT
OF MANA

ddeveloping
NATURE OF MANAGEMENT 27
country working
26 ing, staffing, directing
and controlling-are universal for all
an
industrially
developed
tanising
o r s a s a manager, eacn one must, at one time or another, carry all these duty organisations
from
work in ind.
by managers
and
a particular element may differ
1 country;
to study
country comingo w n country; and trially stics
racteristio
of managers. Only the intensity of
from a
developing
back to
their cnending on thevariables atfecting management practices. This is the principle of
by peoplecountry deversality of management. It implies that any theory or principle about a particu-
2.
and returning in
for m a n a g e r s in a de
a developing
managerial function will apply to all managers irrespective of their level in tne
advanced
programmes
development lar n
and
3. through training untry.
to
country be transterred
from one personanot Distinction between Management Fundamentals and Techniques. In order to
knowledge
can
s a m e country, and
from o n e cher 2. rtain the universality of management, it is proper to make distinction e
Thus, managerial to another
firm in the
knowledge is
meanuntry
because it is the
person,
from o n e firm
This transferability
of managerial
about the uni5
management fundamentals and management techniques because it is the
which varies accordin
Knent techniques
to another country.
universal application.
However, opinions grou specific technique
it has
only when of management are not uniform. uThere areatwo divergent
n d a n o t h e r views tha
ent furndamentals are the basic principles and theories while management tech
applicability is n i v e r s a l e e s are the tools for performing managerial functions. Whereas manageme
that management
suggests scholars undo
to country, management fundamentals wil
many management managema techniques may airrer rom country
one
arguments; 1960s,
is not universally applicable. During is not universal reter
find out the extent to which American omain the same. In tact those who claim that management fundamentals. Gonzalez
took research studies to
particularly less developed cou to management whoPhilosophy and not the management of
applicable in other countries,
were conclusions. Therefore, it i found lack of universality management have
concepts
tries. However, they could not
arrive at unitorm is and McMillan have with
take adequate which lacks universality has to do
essential to this
overcome problem so that lndian managers can emphasised that aspect of management
those between and workers,
concepts developed i n other countries. management
precautions while applying management interpersonal relationships, including and the customer, the community,
com-

mostly developed countries. management and suppliers, management all these factors may affect the application
petition and government. - Naturally and theory of management
of management rather than principles
Arguments for Universality of techniques
themselves.
Experts subscribing to the concept of universality of management suggest that Universality of
the universal and can be found of
basics of
ganisations
management are
in all types or-
situated in any country or culture. For example, Harbinson and 3. Distinction
between Management Fundamentals and are
fundamentals
Practices.
the same, only practices
Myers, in their study of management in a number of countries of the world, management suggests that management is both science and art. The most productive
that "there is logic of industrialisation and organisation build- differ. This is s o because management science underlying it. Thus, science
havehas
concluded
its
a
art is always based
o n a n understanding of the
of managing makes
ing logic too, which rests upon the development of management. This The art of managing or the practice
and art a r e complementary. to variations
brings to the fundamental premise of our study:both
us
theretoisadvanced
a general logic of that is science. However, its practice is subjet
use of organised knowledge, also. For example,
management development which has applicability and in- This may be true even with science
dustrialising countries in the modern world." While offered as a premise, under different conditions. an automobile
Koontz and ODonnell su8gest
that "one would not necessarily expect
o n e planned for high-speed
their study
of management in twelve countries supports it. Another study of 3600 deserts or jungles to be the s a m e as
managers in fourteen countries by Haire, Ghiselli, and Porter supports this view. designed for u s e in science which underpins
both remains the
e v e n though the physical
They have found that there was a high degree of similarity in super highways, also. While the practice may
differ ac-
our
patterns and many of the variations disclosed were due to managerial behavi case with management
same." Same is the of the organisation, the basic fundamentals of management will
tural identifiablecul-
dimensions. Richman has found that the evolving Soviet cording to the nature
managenment utilises management functions-planning,
the approach to remain the same.
tion, control, direction, organising,
leadership, motivation, and staffing-which have coordina
essentially the same
as long-held
studies also support the view that American concepts. Similarly many otner
been Arguments against Universality
and there is nothing like
management fundamentals throughout the is entirely situational
world are almost the same, According to this view, management there is n o such way
as the right

factors. Thus, management onlybetheir applications may differ because of universal principlesto
of management. Therefore, that a r e appropriate
can treated universal phenomenon.
as a various operate or behave.
There are only ways
arguments be advanced to
can
suggest the view of Followu way fora manager
under specific conditions,
faced by managers
universality of management TOr Specific tasks of specific enterprisesThus, what managers do depends o n the
and styles.
cir-

1. Management as Process. or specific temperaments

that
management as a processManagement
country, culture, or size.
as a
process is universal.
is found in all organised It is
argueu
Cumstances. For example,
Robbins says that:
true
from qualifying a s a
The various activities of administration (management)
elements of
management irrespective "The key words that exclude
Although w e have conceps
that

29p.
process-plannb' sCience are 'universal' and
'unvarying uniformity'.
they a r e not u n i v e r s a l . There a r e m o r e

30M.Harbinson and C.A. Myers, under certain qualifications, most of the time, in
Haire, E.E. Ghiselli, Management
and L.W. in the Industrial World, New have application yet e v e n though
these may apply
Porter, York: than five dozen 'principles,
31Wiley,1966.
31B.M.Richman, "The Soviet Managerial McGraw-Hill,
Thinking: An International 1959, P hn Journal of
Study, New York: Management Philosophy."
Educational
opment," California Management and
Keview, SummerResearch Revolution: AGonzalez and C.
McMillan, "The Universality of American

1967,p. 12. Implications forManagement Devel-

April 1961, and
3aemy of Management,O'Dornnell,
PP:3-4l
Heinz Weihrich, Management,
New York: McGraw-Hill, 1988,

Cyril
pD.11 Ontz,
Pp. 115-116.
 AND PRACTICE OF MANA

28
PRINCIPLES
fundamental r universal
ors
EMENT NATURE OF MANAGEMENT
29
classified
as TABLE 1.3:
organisations, they
cannot be correctly n4
Comparison American and Japanese
of
test ofuniversality.
most
truths because many
of them fail the management practices
are not universasal
principies
shows that
management studies in American practices
statement some research Japanese practices
to the needs. Even
This
according Gonzalez and A al
have to be changed
the findings ot an
similar views. For example, These scholars,
on the basis
of a two-
suggested the culture bound. Planning:
'management is
suggest that that: 1. Primarily short-term orientation.
have concluded Primarily long-term orientation.
year study in Brazil,
evidence that our u n i . Individual decision making.
abroad provides Collective decision making
philosophy
American management management is not universally applicable but is rath 3 Decisions flow from top to bottom.
American philosophy of Decisions flow upward and back
special case. AFast decision making but slow im-
the above vie plementation. Slow decision making but fast im

On the basis of similar research, Oberg agrees with

also
He blementation.
in Brazil, being so different 5. Operational decisions as tactical.
the 'game' of management ro Operational decisions as strategic.
expresses doubt that of management n
that played in the United States, would permit application that the princi-
United States to Brazil. It is Oberg's beliet applicabilit. of Organising:
ples, useful in the Situation and that
management principles may be
limited to a particular culture or 1. Individual responsibility. Collective responsibility.
be fruitless to search for a common set of principles, absolutes, or 'determi
may Emphasis on formal structure.
nate solution'. It is even argued that since management principles appear not to ho 2. Emphasis on informal structure.
between sub-cultua
adaptable between cultures, they may not be even applicable
such as those of a rural business owner versus the manager of a large corporation
3. Common organisation culture lacking. Common organisation culture and ph
losophy.
within the United States. 4 Organisational change by external Organisational change by consensus
In a similar study of forty countries by Geert Hofstede,
Dutch management a
change agents. and internal change agents.
scholar, has concluded that people vary a great deal and those differences seriously
challenge the applicability of the principles of effective management practices based Staffing:
on
Westerm theories." The arguments against the universal application of manage- 1. Short-term employment. Life-long employment
ment principles suggest that there are certain factors which affect the application of a
principle or a set of principles of management. The more important of these factors Rapid upward movement. Slow upward movement.
are:
2
3. Segmented concem for employees. Holistic concem for employees.
1. culture of a country or of an organisation,
4 Professionalism. Loyalty to the organisation.
2. objectives of an organisation, and 5. Specialised career. General career.
3. management philosophy of an organisation. 6. Rewards based on individual perfor Reward based on group performance.
mance.
1. Cultural Context of
mined by the culture of Management.
The application of
a
country or of an
management is deter 7. Substantial differences in pay increase. Smal differenoes in pay increase.
ment experts have viewed that organisation. Therefore, many manage
statement is that any management is culture bound. The basis of this Directing:
people-oriented
people come. Management is a process is based on culture from where Patemalistic style.
1. Directive style.
affected by culture. Culture is people-oriented process; therefore, its
beliefs, attitudes, and valuespractice
1s
a set of Group motivation.
shared commonly by that are 2 Individual motivation.
the members of
society, it may have subcultures too. society. Since there may be working and private life.
a
It implies that heterogenity in 3. Separation of working and private life. Confluence of
differ from country to
country and also from management practices may Leader as group facilitator.
the same country because of organisation to organisation within 4. Leader as decision maker.
tices in two most cultural differences. For example, Bottom-up communication.
cause of
industrially advanced countries-USA andmanagement prac
cultural differences. Some of
5. Top-down communication.
Table 1.3. these Japan-differ be
contrasting practices are presentea 6. Emphasis on written communication.
Emphasis on face-to-face communica
tion.

34Stephen P.Robbins, The Administrative

5Gonzalez and McMillan, op. cit. Process, Englewood Cliffs: Controlling:
3ow. Oberg. Prentice-Hall, 1976, p. 21. Control by peers.
"Cross-Cutural
June 1963, pp. 129-143. Perspectives Management
on Control by superior.
37Geert Hofstede, "The Principles," Academy of Managemeit Control of group performance.
Cultural Reality Organisational Practices
Business Studies, Fall, 1983. of Joura 2 Control of individual performance.
Extensive use of quality control circle.
and Theories," al
Journal of Internaro 3. Limited use of quality control circle
 OF MANAGEN.
PRACTICE
JATURE COF MANAGEMENT
PRINCIPLES
AND
EMENT NA1
31
organi tent of
Differences in philosophies of
various

of organisations
PLOns the ext
differenceorbetween two
types of industries. Thus, further away a
types noves in terms
2. Management
Philosophy.
good manager
a
in all
as in a person's
philosoOsc organisation and industry characteristics,
agn period and lower is the extent of transferability. the
a limit o n the person being activities

Put attitude toward

an
certain

evaluation or interpretation
is importaof
ot what o edan cannot demonstrate equal effectiveness in differentTherefore,
of
it implies thata
phy can mean
i n d i v i d u a l , has
philosophy types organisations
business. It may be
an
an
doing
life.
organisation,
Every
like
require different Lng Conclusion

meaningful in of various organisations different nhds

Differences in philosophy organ1sations having various arguments for and against the universality of management concept
business. two business hs l d be analysed in an integrated way so as to arrive at a particular
approaches. Bhattacharva
Even
managerial techniques. managerial conclusion
of different types
of
of companies operatin This conclusion 15 important because developing countries can import managerial
phy may require of two groups
found differenc n
alysed p rthe
management processes family-managed-and
non
W-how and principles developed by the advanced countries if they are universal
Table 14." It may be
and An integrated analysis suggests that there are certain management principles which
ndia
ofessionally-managed
of companies
shown in ointed
in two groups their own culturees are universal thougn their practices may differ from country to country or from
these practices different organisations may abopt oanisation to organisation even within the same country. Therefore, the knowl-
culture,
out that within a given
and management philosophy. ede of managementcan be transferred from one country to another country. In fact
in the
in two groups of companies Bulk o management knowledge has been developed
this has happened. where
TABLE 1.4: Management practices
tinited States from borrowed. The process of manage
other countries have
Protessionally-managed Family-managed ment transfer has been undertaken in the following ways:
Dimensions of companies
companies curriculum of management educa-
management
1. Through the use of American literature in the
Emphasis on tion in various countries;
1. Nature of desire Emphasis on professional demonstrated skills, depth of countries in the United
Through training of managerial personnel developing
qualifications and rank
managerial skill and quality and knowledge 2.
States; from
to Emphasis on originality of Through the consultancy assignment
undertaken by management experts
2. Actual performanoce Emphasis conformity
on
action and thinking. 3. countries; and
organisational values. the United States in developing in the
loyalty and relative fit
with innovation, and adopted by multinationals operating
the position
upgradation of knowledge
Through the management practices
and skills developing countries.
States
educated in the United
not be taken that managers
Emphasis on selective However, it should of management
3. Style of planning and Emphasis on information countries but factors limiting
the application
decision making gathering. bureaucratic information usage will be effective in all
mode of tfunction, risk intituitive and qualitative
aversion and non decision making of
enterpreneurial decision entrepreneurial nature

making Affect
Management systems Emphasis on use of Emphasis on reliance on
business sense and no Element of the
adopted elegant, scientific. External
geared to Management Process
sophisticated and rational trills. systems
quick action
Constraints
Management and
system
Planning Affect Managerial
Emphasis on primary use
Educational Organising effectiveness
5. Nature of management Comprehensive, formal Sociological Affect
control and written reporting of verbal reporting and
Lega-political Staffing
remedial action
Economic
Controlling9
Policy-making in
operating a r e a s Determine
3. Organisational Objectives. The objective of an enterprise determines the type
of management required. Peter Drucker feels that the skills, competence and exPE
ence of a management cannot as such be transferred and applied to the busness
organisation and running of other institutions. The basis of his view is that busine Firm efficiency
organisations exist for economic ends and management consists of skills and t e
Determines
niques for attaining these ends Since the main objective of the business-prot
consistent with seCurity and weltare of the business-differs from that of
ness organisation, management can transfer only analytical and
non-D System efficiency
of skills, abilities, and experience.
administrative typ
Transferability of management is determineu
management

ss.K. Bhattacharya, "Organisational Culture An Indian

Perspective," Busnessuord, February
1, 1985,
model for analysing
comparative

Pp 48-49. Farmer-Richman

Drucker, op. cit. FIGURE 1.3:

 AND PRACTICE OF MAN NATU OF MANAGEMENT
PRINCIPLES
understand the fa-
AGEMENT 33
32 order to
affo failures. If
their failures,
in choosing and these
account. In promineOrs oftheir reasons are
be taken into constructed,
Th nong #g
casions
understood, managers can improve
principles
should
some
mnodels have been and Koontz41 implementing theories. Some of the major reasons for
management
practices,
by
Farmer and Richman the factors there
Te thee of the theories are as follows:
are the
models developed
both emphasise modal ProCes Ses
some
differences
between the two models,

d i f f e r e n c e s in management
practices.
F o r example, the
of Farmer 1 Lack Proper
bf Understanding of
fully understand it. Theory.
n o t fu
In many cases, the
individual trying
1.3 (page 31). eory does Lack of complete
affecting
has been presented
in Figure
basic factors
which affect the
the ac a theol to apply something
other than the understanding can
cause the
and Richman
there a r e four Option a indiv an inappropriate situation, theory in question, or to apply the
According to this model, organisation. These are that is using the correct
in a country
o r in
an affCational theo For example, often managers commit mistakes in
solution for the
wrong
other factors which
management practices oblem

sociological, legal-political,
and economic. Some
stage of the organ: on, man e p t (discussed in Motivation applying job enrichment
chapter). Instead of enriching
a r e culture, technology, life and Boodewyn)47 T
and
conceotivating, theytomay overload it, or may enrich àa job the job to make it
agement practices
position-location of managers
(model of Ajiferuke
of individual firms, will he
ne total
nderpaid in relation market conditions n job that is currently grOssly
grossly
through the efficiency that there is often manted by
system of the country, It has been suggested ta Consideration given for Systems Effects. One of the most
the practices of management.
countries and because of
this factor, these countries are
po
2 No
es common experi
of managers wno try new theories is that while they may solve the original
gap in developing suitable management practices in thecPOr
ences

Therefore, there is a need for adopting

roblem, occasionaly new.problems are created as a result of the action, and the
cannot be developed unless there is a develon
un
tries. However, such practices
of such a body of knO Dody Panagers end up thinking they were better off before. This happens because theoret
The development al models tend to neglect the systems effect of introducing change into an organisa-
of knowledge of management. developed in advanced countries
a

long process. Therefore, the knowledge the knowledge, consideration has to

due tion. For example, a manager may enhance the status of a group to enhance its
imported. However, while importing productivity. It may work positively for the group but may create problems for the
given to the factors which affect management practices enumerated above. Thus # other groups whose status gets reduced in relation to the target group.
total knowledge of management can be classified in three parts: (1) that aspect of
knowledge which can be adopted in total, the adoptable; (1i) that knowledge which 3. Lack of SpecificApplicability of a Theory. Generally, theories are developed
can be adopted with some modifications, the adaptable; and (ii) that aspect of using scientific methods on relatively large number of observations. Consequently,
knowledge which is inapplicable. The distinction among these is necessary because theories developed tend to apply to individuals collectively, but not to any one
only first category of knowledge can be imported as such while some modifications specific person. A manager may attempt to apply a prescriptive staterment from a
are required in others. Generally the knowledge which is impersonal is adoptablein general theory to a specific situation that does not fit the general requirements of the
total but the knowledge which deals with human factor has to be theory. For example, the theory states that money is not a motivator in general
modified. This terms. However, it may be a motivator for an individual because of his specific
modification can be brought about by suitable research, observation, and
practice. background.
4. Lack of Universal Applicability. A theory, particularly in management and or-
Applying Management Theory in Practice ganisational behaviour which are affected by characteristics ofhuman beings which
The basic objective of may differ from place to place, lacks universal applicability. Thus, a theory devel-
studying management is to gain knowledge about
manage organisations to
optimise the
so as how to oped in one situation may not be applicable in another situation because variables in

spread this knowledge, various managementachievement of their objectives, and

theories and principles have
to twosituations may be different. This
aspect important for
is Indian
managers when
veloped. However, a common statement made been
by managers is, "That is fine in de- they apply the theories developed abroad for managing Indian organisations
theory, but, in practice, it does not work." While this
global
ries
level, Indian managers have specific
is true for the
managers the
reasons to be dissatisfied with the at
5. Wrong Theory. Sometimes, wrong theory may be created. This maythehappen
conditions under which
developed industrially-advanced countries and are
in theo Decause of several reasons: (i) the environmental theory
text. These managers followed in Inala conclusions have been drawn from right
may be correct in s created have changed; (ii) incorrect
might not have worked. This state of saying so as the theories they have apPP ata; (11) correct conclusions have been drawnthatfrom poor data; and (rv) researchers
ultimate affairs is unfortunate since affect the results. In such a situa
work, thelaboratory
for the social the real wOria ave overlooked other significant influences
gap between theory and scientists. If bad theories are tion, the theory may not work at all.
identify the reasons why theories dopractice is widened. Therefore, created
it is
that
to
Why Theories Fail?
not work in
practice. importa Value of Theory
It is true that for failure of theories, we may find that reasons are

many theories have failed two.eayse the reasons incorrect because of lack of proper
therefore, attempts are on to evolve to TOld: (i) the application of theory is
failure of theories are new
produce the desired results in ctice; Thstanding, o r (i) the theory itself may be faulty
and lacks applicability.
more theories. However, P the consideration the reasons for failure
40Farmer and Richman, cit. important to analyse rather than the reasoino the Of # e, the practitioners have to the
take into
reality by commenting
'it does not work
'Harold Koontz, merely cou should not ignore
op.
in nraeory and and theories developed in the field of
of "Models for Analysing the
12M. Management Journal, December ma ce. Fortunately, a lot of concepts
Ajiferuke 1969, Universality and Transferability and their understanding is important for
and
Studies," AcademyJ. ofBoodewyn, "Culturepp. 415-629. erability of of Management," Academy effeesment do have applicability, contribute to
43 AN. Agarwala, Management and
Journal, June Other
Emerging Dimensions Explanatory Manageme manaco anagement practices.
How management principles
management knowledge has been
of Indian 1970, pp. 153-163. Variables in
enhancing
Comparauv dise nent practices and
Management, Bombay: Asia alscussed later in this section.
Publishing, 1970-
 NATURE OF MANAGEMENT
PRACTICE OF MANAGC 35
PRINCIPLES
AND
SEMENT artant index of the state of maturity of science is state of its
34
qmost im des the character of the general conceptual scheme systematic theory.
Value of Experience provided tho This n d degrees of logical integration of the different elementsinwhichuse in the field,
make
the
managerial effectiveness ese
re kinas in which it is actualy used in empirical research. The recent it up, and
emphasis on
increasing practitioner has
important for that the
Theories a r e utilisation of
a theory situation in which the theory both
requires the ment researches has increased the quantum of
utilised properly. Proper as well as that of the to b knowledge in this field.
As mentioned ocial Objectives. Management itself is part of the society and it
knowledge of the theory situation comes from experience. of both makoe, To Attain Soc
of 4. e inputs from the society and gives the outpui to the society. Thus, the
applied. Knowledge and art;
therefore, combination the
is both science theoretical knowle
management effective. Its science aspect
suggests that taadard of the society depends upon the quality of the management. If the manage
organisational processes that perfection can be
achieved through Dra icient, the resources of the society are better utilised thereby giving more
ment is efficie

1S necessary; its art aspect suggests

'either or it
situation; is a blend of both. the societyplayan
atisfaction toprinciples i
the quality of life of people. In this context,
ingthe
ana improving quality
and practice is not
an ...

theory the practitiono role.

Therefore, of doing the things because eportant
to better way management
Experience contributes marhus,
Thus, the
theunderstanding of management principles enables managers to take a
of time and may retain the understandine

the undesirable practices over a

period of time on the deals
may weed out their solution.
and Management
this process may take a lot undesirable. realistic view of organisational problems the atom are far
desirable practices. However,
between what is desirable
or he
If ha more
in the organisation, and the structure and behaviour of
practitioner to make distinction Therefore, tha rith people behaviour of groups of people. To direct the
theories, he do so in much lesser time. loss Complex than forthe structure and some principles are certainly required.
can
knowledge of relevant makes the experience meaningfu. When the experience is objective achievement,
knowledge of the theories and value. It is a very old savino
human behaviour would definitely have an impact
the on

cautious of its meaning Development of management principles use of human as

well as
unscientific, we must be ten times, if the exper efficiency in the
that ten years' experience may only
be one year's experience ultural level of society by increasing while putting management principles into
material resources. However, managers, before their use.
ence is not proper. the comprehen and
their validity applicability
if used wisely. Experience allows practice, should
check
Experience is a valuable asset much more easily. Experienced managers are
sion of the theoretical concepts EFFECTIVE MANAGEMENT
the magnitude of adept
application knowledge but is to make one
an
the of
certainly more adept in experiences. In doing so, a functions and techniques
of management these bear
from The basic objective
to learn their because
ness will depend upon their ability effective managers
and draws con- organisations require Who is an effective
man-

practitioner is just like an academician. Each performs experiments effective manager. The the basic question is:
difference lies in the methods and them. However, c h a r a c t e r i s t i c s of effec
clusions from their experiences. The major costs for employing
one must identify
the various
functions of
evaluate the experience. 1he academician prefers
to call the experience From this point of view, made to correlate
the various
techniques to
generalisations based on several such ager? attempts are
that e f f e c t i v e n e s s .
experiment or research and tries make and experiernce are complementary to
as
to tive managers
so
debatable points
for achieving effectiveness a r e quite
experiments. Thus, in the final analysis, theory is undesirable, the
management
the concept and
criteria of
c a n be
measured and
each other. Just as all experience with no theoretical background
that
Truly speaking, E f f e c t i v e n e s s is not
o n e - d i m e n s i o n a l concept
be
that is, onlytheory and no practical experience managerial effectiveness can
egghead'approach management,
to in management.
a set of
clear-cut criteria. However,
behaviour. For example, Guion
is equally inappropriate. predicted from terms of organisational goal-achieving goals
defined mostly in lies largely in meeting major organisational
an executive these efforts depend
Role of Management Principles s u c c e s s of in part at least,
The principles of management have a tremendous impact upon the practice of man states that the
c o o r d i n a t e d efforts
of his organisation; those whose
work
behaviour

o through the the executive

has upon
a c h i e v e m e n t ot organisatio-

agement in increasing the efficiency of the organisation. The need and inmportance
influence the
kind of c o n t r i b u t e s to
upon the executive's o w n
behaviour
and m o t i v e s
of other people
management principles can be visualised as follows: touches.The on the perceptions,
attitudes,
its influence
1. To Increase Efficiency. The established principles of management provie nalgoals only by and on their subsequernt behaviour
managers guidelines as to how they should work in diferent situations. hese n the organisation
terms are
principles increase managerial efficiency. Today, a management graduate, who has Effectiveness and Efficiency and efficiency
as both these
denote
acquired the knowledge of management principles, definitely puts better etticien effectiveness
both these
arises between though
and effiectiveness in the organisation. Though, there is a serious limitation f
interchangeably,
a confusion
Orten sometimes, viewed that:
closely and, B a r n a r d has
management principles, that is, these have to be modified according to situations a sed quite of affairs.
For example,
operative goals
have been at-
these deal with human beings of diverse nature, these enable a manager r e r e n t states to which i n c u r r e d in
is the degree ratecost/benetit

the situations in a better and save him from costly

way the
understand different
effectiveness
Organisation represents
trial-and-error method. while the concept of efficiency Efficiency is
tained tocussed.
these goals." is externally
pursuit of and output.
2
To Crystallise the Nature of Management. Lack of understanding of manage
ment principles makes it cifficult to analyse the management job and to define the
the
is related
to goals
which

relationship
between input
of o u t -
to the amount
effectiveness

produce certain
refers
Ihus, and it says
used to
Barnard
exact scope of managerial
furnctions. Thus, individuals cannot be trained effecurules, nengineering way have been
for example,
for managerial positions. According to Henry Fayol, management principles, T d e n o t e s how much inputs
both go
together
always.
that
methods and procedures are necessary to train and educate future
managers. puts
t I s
not necessary Press, 1968, p.
7
3. To Carry on Researches. If, in 466.
1980,Mpa s s . : University
any subject, certain fundamental principlese
Harvard
York: MaGraw-Hill,
developed, the scope and limitations defined, these become the basis for ru 44R.N Guion,
Personnel Testing,
Functions
New

ofthe
Combridge,
Executie,

researches. In the absence of these 45 Barnard, The

principles, researches become difficult and he
horizons of knowledge cannot be expanded. It is
S t e r .

scarcely too much to say tnaet t

 PRACTICE OF
36 PRINCIPLES AND MANAGEMENT NATURE OF MANAGEMENT

"When unsought consequences trivial, or insignijicant, ejective action is effiei

are
that, action may be ineficient". Thera The above descriptions
suggest that the various qualities contribute to the effec-
en uns0ught consequences are not trivial, effective may sveness directly and are important.
However, least
be three types of situations:
but not be effective. necessary because these may contribute indirectly to thedescriptive qualities are also
effectiveness.
An organisation may be efficient but may not be efficient.
2. An organisation may be effective may
2. The Process.
Managerial
effectiveness depends
upon the managerial
An organisation may be both efficient and effective.
volved in managing the afftairs of the
organisation.
In this process
3.
list, because it is
not just poSsible to category, there is a long
In the first situation, the organisation may be efficient but it may not be effecti..
related to his various functions.
specify
here the behaviour of a manager as
e However,
the following are some of the
important
because efficiency refers to internal conversion processes whereas effectivenes
ness behaviours of effective managers:
reflects external phenomenon. For example, the organisation may be low-cost
producing (efficient) but it may fail to realise matching price tor its products. The 1. They manage people instead of work.
result is that the organisation is incurring loss ineffective) in spite of it being 2. They plan and organise effectively.
efficient. This happens when the product is in the declining stage of its life cycle. 3. They set goal realistically.
In the second situation, an organisation may be effective at a point of time with
out being efficient. It may not be efficient but because of the external
4. They derive decision by group consensus but accept responsibility for them
environment 5. They delegate frequently and effectively.
particularly market situations), it may earn profit and show effectiveness. For exam-
ple, in Indian business scenario, many inefficient organisations in some industries 6. They rely on others for help in solving problems.
like mini steel, mini cement, Soya extractionindustries made huge profit but lateron, 7. They communicate effectively.
whenIn the situation changed, these organisationsbebecame
the third situation, an
extinct.
efficient and effective both at the
8. They are stimulus to action.

same time.
organisation may 9. They coordinate effectively.
Many types of organisations may fall under this category, and this is the 10. They co-operate with others.
situation which is required for the long-term survival of
situation that people tend to use organisations. It is in this 11. They show consistent and dependable behaviour.
efficiency and effectiveness interchangeably.
12. They win gracefully.
Effective Manager
13. They express hostility tactfully.
An effective
manager is one who is positive in his personality, that is, what type of 3. The Results. Effective managers and effective managing will lead inevitably
to
person he is, his managerial process, and results of his managerial process, although of for which they are working in the
all these are
interdependent. good things, that is, the achievement goals
organisation. Thus what will be the outcome depends upon the type of organisations
1. The Person. The basic conflict about the organisational goas and
question in this context is: What types of persons are
most likely to become effective they are working for. There may be some and
managers, and what types fail? There are various measurement criteria, but here it is sufficient to say that managerial actions
such studies to suggest the possible their
behaviours must contribute to the realisation of organisational goals
Jurgensen has described the personal qualities
of a successful
manager.
characteristics of a successful
sented in Table 1.4. manager*"
which are pre Key Concepts for Review
Management as art
Administration
TABLE 14: Characteristics of an Management as profession
effective manager Concept of management
Management as science
Cultural context of management
Most descriptive of Management philosophy
effective manager Least descriptive of Effective management
Management theory in practice
effective manager Effective manager
Decisive Amiable Effectiveness
Nature of management
Aggressive Professional approach
Self-starting Conforming Efficiency Role of management principles
Neat Features of management
Productivity Importance of management
Universality of management
Well-informed Reserved
Determined Agreeable
Energetic Conservative DISCUSSION QUESTIONS
Creative Kindly is defined and, therefore, there is n o
1. "There various ways in which management
are
Examine this statement and provide a n accept-
Intelligent Mannerly unanymous definition
of management
Cheerful which should reflect its true features
Responsible able definition of management
Fomal which managers create, maintain, and operate purposive
Enterprising 2. "Management is the process by
human efforts." Elaborate and explain
Clear-thinking Courteous organisations through
coordinated, cooperative
Modest this statement.
46C.E.
Jurgenson, "Report Participants
to and bring out its importance in present-day context.

Managerial Behariour, Performance and on Adjective Word 3. Explain the concept of management
Efectrveness, New York: Sort," quoted in
McGraw-Hill, 1970, John Campbell, er. "

71bid, pp. 7-8.

p. 105.