After reading this chapter, you will be able to:

1. Explain what is meant by the term management.

2. Describe the Five functions of management.
3. Classify the three levels of managers and identify the
primary responsibility of each group.
4. Summarize the essential roles performed by
managers.
5. Describe the general skills necessary for becoming a
successful manager.
6. Differentiate between efficiency and effectiveness.
7. Understand the Evolution of Management Thought.
How Do We Define Management?

• Management as an art of getting things done.

• Management as a process

• Management as a group of managers

• Management as a Discipline
1–3
1–4
Nature of Management
• An Intangible force

• A Goal Oriented process

• Universal Application

• A System of Authority

• A dynamic process

• A science as well as an art

• Multi-disciplinary subject
 Functions of Management
• Planning
It involves deciding in advance what to do, when to do, where to
do, how to do and who is to do and how the results are to be
evaluated.
• Organizing
It involves identification and grouping the activities to be performed
and dividing them among the individuals and creating authority and
responsibility relationships among them for
the accomplishment of organisational
objectives.
• Staffing
It pertains to recruitment, selection, training, development and appraisal
of employees.
• Directing
It involves issuing instructions to the subordinates, leading, motivating
and supervising them.
• Controlling
It deals with the measurement and correction of the performance of
persons against the pre-determined standards.
Organizational Levels
 Levels of Management
The term ‘Levels of Management’ refers to a line of
demarcation between various managerial positions in an
organisation.
• First-line Managers (Supervisor, foreman)
 Supervisors responsible for directing the day-to-day
activities of operative employees
• Middle Managers (Heads of various Departments)
 Individuals at levels of management between the first-
line manager and top management
• Top Managers (CEO, President, MD etc.)
 Individuals who are responsible for making decisions
about the direction of the organization and establishing
policies that affect all organizational members
People Differences
• Operatives
 People who work directly on a job or task and have
no responsibility for overseeing the work of others.
• Managers
 Individuals in an organization who direct the activities
of others.
 Mintzberg’s Managerial Roles

Interpersonal
Figurehead
Leader
Liaison
Informational
Monitor
Disseminator
Spokesperson
Decisional
Entrepreneur
Disturbance handler
Resource allocator
Negotiator
 General Skills for Managers

Skills of Successful
Managers

Conceptual Interpersonal
Technical skills
Skills skills
1–13
 Efficiency and Effectiveness
Efficiency
Doing the thing correctly; refers to the relationship between inputs
and outputs; seeks to minimize resource costs
Effectiveness
Doing the right things; goal attainment
 How Does Management Relate
to Other Disciplines?

Sociology

Political Science Psychology

Management

Anthropology Philosophy
 Evolution of Management Thought
• Classical Approach
-Scientific Management Approach
-Administrative Approach
-Bureaucratic Organisation Approach
• Neo-Classical Approach
-Human Relations Approach
-Behavioural Science Approach
• Modern Approaches
-Systems Approach
-Contingency Approach
 Scientific Management(F. W. Taylor)
• It means application of scientific methods to the problems of
management.
• Principles of Scientific Management :
-Science, not rule of thumb
-Harmony, not discord
-Cooperation, not individualism
-Maximum, not restricted output
-Development of each employee to his greatest efficiency
 Guidelines to the practice of Scientific Management

• Scientific study and planning of work

• Scientific selection, placement and training
• Standardization
• Division of responsibility between Management and Workers
• Functional Foremanship
• Mental Revolution
• Wage Incentives
 Administrative Approach
Fayol’s Fourteen Principles of Management

1. Division of Work
8. Centralization
2. Authority &
9. Scalar Chain
Responsibility
10. Order
3. Discipline
11. Equity
4. Unity of Command
12. Stability of Tenure
5. Unity of Direction
of Personnel
6. Subordination of
13. Initiative
Individual’s Interest to
Interest of Organisation 14. Esprit de Corps
7. Remuneration
 Bureaucratic Organisation Approach
• Max Weber’s theory of bureaucracy recognises rational-
legal authority as the most important type in
organisations.
• A bureaucratic organisation displays the following
characteristics:
-Division of work
-Hierarchy of positions
-Rules and Regulations
-Impersonal conduct
-Staffing
-Technical Competence
-Official Records
 Neo-Classical Approach
• Human Relations Approach: Elton Mayo is recognized as the
father of the Human Relations Approach. The basic tenets of
this approach are:
-The business organisation as a social system.
-The behaviour of an individual is dominated by the informal group of
which he is a member.
-An individual employee cannot be motivated by economic incentives
alone. His social and psychological needs must be satisfied to improve the
level of motivation.
-In an organisation, it is ultimately cooperative attitude and not the mere
command which yields result.
-Management must aim at developing social and leadership skills in addition
to technical skills.
-Morale and productivity must go hand in hand in an organisation.

(Contd….)
Factors affecting Human Relations
 Individual

 Work-Group

 Work-Environment

 Leader
 Behavioural Science Approach
• Under this approach, the knowledge drawn from behavioural
sciences namely psychology, sociology and anthropology is
applied to explain and predict human behaviour.
• The behavioural scientists made the following propositions:
-An organisation is a socio-technical system.
-Individuals differ with regard to attitudes, perceptions and value systems.
-People working in the organisation have their needs and goals which may
differ from the organisational goals. Efforts should be made to achieve
fusion between organisational goals and human needs.
-A wide range of factors influence inter-personal and group behaviour of
people in organisations.
-To sum up, the behavioural science approach gives emphasis on
increasing productivity through motivation and leadership.
-Thus the central core of this approach lies in participative management,
group dynamics, communication, motivation and leadership.
 Systems Approach
• This approach is based on the generalisation that an organisation is a system.
• An organisation as a system has the following characteristics:
-A system is goal-oriented.
-A system consists of several sub-systems which are
interdependent and inter-related.
-A system is engaged in processing of inputs into outputs.
-An organisation is an open and dynamic system.
-A system has a boundary which separates it from other
systems.
 Contingency Approach
• This approach to management is based upon the major
premise that there is no one best way to handle any of the
management problems.
• There are three major parts of the overall conceptual
framework for contingency management: (i) Environment (ii)
Management concepts, principles and techniques and (iii)
contingent relationship between the first two.
• The approach rejects the universality of management
concept and appeals to common sense.
• Management should match its approach to the requirements
of the particular situation.
• The approach is action-oriented as it is directed towards the
application of systems concept and the knowledge gained
from other approaches.