20MG301 Principles of Management

Module-1
Principles of Management

Topic: Basic Functions

of Management
 Functions of Management
Functions

Planning Organising Staffing Directing Controlling

 Functions of Management (contd.)
Planning
• Looking ahead
• List of activities for future
• Effective planning leads to efficient management
Effective planning provides answers to questions such as
What to do?, When to do?, How to do?, Who is to do?
The planning process involves the following activities:
• Determination of the goal of the organization
• Formulating policies, rules, procedures etc., for the organization
• Forecasting the future based on past and present activities
 Functions of Management (contd.)
Organizing
• Establishes the harmonious relationship among all
workers of an organization by providing them with
suitable authority and responsibility.
• Organization 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 organizational objectives
-Louis A. Allen
 Functions of Management (contd.)
Organization process involves the
following activities:
1. Identification and analysis of
activities required for the
attainment of organizational
objectives
2. Assignment of duties to the
individuals concerned
3. Follow up the activities
 Functions of Management (contd.)
Staffing
• Staffing process involves the selection of candidates for positions, fixing salary,
training and developing them for effective organizational functions.
• The manager performs the duties of job analysis, job description etc., which
come under the staffing function

Directing
• Involves the activities such as guiding, supervising, communicating and
motivating the subordinates in their jobs.
 Functions of Management (contd.)
Controlling

Deals with the checking and verifying the activities against the predetermined
standards.
It is the process of ensuring that the actual activities confirm to the planned activities
Controlling process involves the following steps:
1. Establishing standards
2. Measuring the current performance
3. Comparing this performance to the established standards
4. Taking the corrective actions of deviations that are detected
 Planning

Planning is the selecting and relating of facts and the

making and using of assumptions regarding the future in
the visualization and formulation of proposed activities
believed necessary to achieve the desired results
-George R. Terry
 Nature of Planning
Planning- a primary function: It preceded all functions such as organising,
directing etc., There is no meaning of other activities without setting the goals
to be achieved and line of action to be followed. All other functions of
management largely depend on planning

Planning- a dynamic process: Continuous managerial function involving

complex processes such as perception, analysis, communication, decision and
action. It is a never ending activity of a manager of an enterprise. Most of the
plans are modifying, revising according to the changes in the circumstances.
 Nature of Planning
Planning- based on objectives and policies: Involves in setting
objectives to be achieved and determining the techniques for
achieving those objectives. Those various techniques such as
policies, programmes and procedures are formulated. Objective
determines where we are to go and planning makes a bridge over
where we are and where we want to go. Planning and objectives
are related
Types of Plans
 Nature of Planning (contd.)

Planning- a selective process: Planning manager has to select

only one alternative which is best suited to the firm

Pervasiveness of planning: Planning function should spread or

make available throughout the organization. Every manager has
a planning function to perform. Scope of planning differs from
person to person depending upon the levels of management
 Nature of Planning (contd.)

Planning- an intellectual process:

• It is a mental exercise involving creative thinking, sound
judgment and imagination.
• It is a process where a number of activities are to be taken to

decide the future course of action, achieving the desired goals,

the detailed process of every course of action and then finally
decide which course of action may suit them best
 Nature of Planning (contd.)
Planning is directed towards efficiently: Planning directed to increase the efficiency of the firm.

1. Planning is an intellectual activity that aims the best way of doing things

2. Planning provides the goals and objectives

Thus the planning is directed towards efficiency

Planning – Focus with Future activities: Planning is primarily concerned with looking into future.
It forecasts the future situation in which the organization has to function

Flexibility of planning: Planning is flexible as commitment which is based on future course of

action.

Planning is based on facts: It is not a trial and error method. It is conscious determination of
course of action for the future. It is based on facts , objectives and considered forecasts.
 Planning Process
1. Identification of opportunities

2. Establishment of objectives

3. Developing planning premises

4. Identification of alternatives

5. Evaluation of alternatives

6. Selecting an alternative

7. Formulating derivative plans

8. Establishing sequence of activities

 Organizing
Organizing is the process of defining and
grouping the activities of the enterprise
and establishing the authority relationships
among them
-Haimann

An identified group of people contributing

their efforts towards the attainment of
goals is called an organization

-Farland
 Nature of Organizing
• Common Objectives: Every organization exists to achieve some common
objectives. All efforts of the organization are directed towards this goal

• Specialization or Division of Labour: The total work of an organization is divided

into functions and sub-functions to get the benefits of specialization

• Authority of structure or Chain of command: There is an arrangement of

positions into a graded series. The authority and responsibility of each position is
defined in the form of structure. The chain of superior and subordinate
relationship is known as chain of command
 Nature of Organizing (contd.)
• Group of persons: Group of persons: Organization- group of persons.

• Communication: Every organization has its own channels of communication. These

channels are necessary for mutual understanding and cooperation among members of
an organization

• Environment: An organization functions in an environment comprises of economic,

social, political and legal factors. Therefore, it must be desired to work efficiently in a
changing environment

• Rules and Regulations: For the effective functioning of an organization, it should have
some rules and regulations. Such rules and regulations may be in written term or
implied form customary behavior
 Process of Organizing
1. Determination of activities

2. Grouping of activities

3. Assignment of Duties

4. Delegation of authority

5. Establishment of structural relationship

6. Coordination of activities
 Staffing
• Staffing is the managerial function of recruitment,
selection, training, developing, promotion and
compensation of personnel.

• Staffing may be defined as the process of hiring and

developing the required personnel to fill in the various
positions in the organization.

• Staffing is the process of identifying, assessing,

placing, developing and evaluating individuals at
work.
 Significance of Staffing
Staffing helps in discovering and obtaining competent and personnel for various jobs.

• It helps to improve the quantity and quality of the output by putting the right person on the
right job.

• It helps to improve job satisfaction of employees.

• It facilitates higher productive performance by appointing right man for right job.

• It reduces the cost of personnel by avoiding wastage of human resources.

• It facilitates growth and diversification of business.

• It provides continuous survival and growth of the business through development of

employees.
 Different Process

Interviews Tests

Assessment Centers
Difference between Recruitment and Selection

It is an activity of establishing contact It is a process of picking up more

between employers and applicants. competent and suitable employees.

It encourages large number of It attempts at rejecting unsuitable

Candidates for a job. candidates.

The candidates have not to cross over

Many hurdles have to be crossed.
many hurdles.

It is a positive approach. It is a negative approach.

It proceeds selection. It follows recruitment.

 Placement
• Once the candidates are selected for the required job, they have to
be fitted as per the qualifications.

• Placement is said to be the process of fitting the selected person at

the right job or place, i.e. fitting square pegs in square holes and
round pegs in round holes.

• Once he is fitted into the job, he is given the activities he has to

perform and also told about his duties.
 Orientation
During Orientation employees are made aware about the mission and vision of
the organization

Generally the information given during the orientation programme includes-

• Employee’s layout

• Type of organizational structure

• Departmental goals

• Organizational layout

• General rules and regulations

• Standing Orders

• Grievance system or procedure

 Training of Employees
• Training of employees takes place after orientation takes place.

• Training is the process of enhancing the skills, capabilities and

knowledge of employees for doing a particular job.

• Training process moulds the thinking of employees and leads to

quality performance of employees.

• It is continuous and never ending in nature.
 Employee Remuneration

• Employee Remuneration refers to the reward or compensation given to

the employees for their work performances.

• Remuneration provides basic attraction to a employee to perform job

efficiently and effectively.

• There are mainly two types of Employee Remuneration

 Time Rate Method

 Piece Rate Method

 Directing / Leading
• Leading is the influencing of people

• This makes them to contribute to the organization and its goal.

• Effective manager need to be effective leaders.

• People need leader who,
Satisfies the needs
Wishes
Desires
 Directing

• Directing is defined as the process of instructing, guiding

and inspiring human factors in the organization to achieve

organization objectives.
• It is not only issuing orders and instructions by a superior

to his subordinates but also including the process of

guiding and inspiring them to work effectively.
• It includes Leadership, Motivation and communication
 Nature of Directing
Activity initiation function: Directing is an important managerial function through which
the management initiates actions in the organisation

Pervasive Function: It is performed at all levels of management. Every manager in the

organization performs his duties both as a superior and a subordinate

Continuous activity: It is a continuous process and it continues throughout the life of the
organization. The managers has to give direction to his subordinates, but the process will
not end with giving directions as he has to guide and motivates them continuously so that
the desired goals can be achieved

Dual Objective: 1. Aims at getting things done by the subordinates 2. Provides an

opportunity for the managers to prove their leadership qualities
 Nature of Directing (contd.)
Flow from top to bottom level: It basically initiates at the top level of the organization and
follows to bottom through the hierarchy. It emphasizes that a subordinate is to be directed
by his own superior only

Delegate human function: It deals with human behaviour. Humana behaviour is

unpredictable by nature and conditioning the people’s behaviour towards the goals of an
organization is what the manager does in the function

Creative Activity: Directing function helps in converting plans into performance. A manager
needs to have a creative and innovative thinking so that he can guide and motivate his
subordinates with new ideas and techniques and making their performance better one

Facilities Coordination: It brings harmony among employees and balance between all the
activities of an organization
 Controlling
Controlling is a systematic exercise which is called process of checking actual
performance against the standards or plans with a view to ensure an adequate
progress and satisfactory performance

-E F L Brech

Controlling is the measurement and correction of performance in order to make

sure that enterprise objectives and the plans devised to attain them are
accomplished

-Harold Koontz
 Nature of controlling
Controlling process is universal: Controlling is an essential function in any organization
such as an industrial unit, university, government office, hospital etc.,

Controlling is a continuous process: It is a never ending activity on the part of

managers and it is a non stop process. The manager watches the operation of the
management and to see whether they are going towards the desired end and if not,
actions are not taken to correct them

Controlling is action based: Action is an essential element of the controlling. Controlling

is the action which ensures the performance according to the decided standards
 Nature of controlling (contd.)
Controlling is forward looking: It is linked with the future but not with the past. A
proper control system prevents losses and minimizes wastages. It acts as a preventive
measure

Control is closely related to planning: A planning gives the direction to various

business activities while controlling verifies and measures the performance of these
activities and suggest proper measures to remove the deviations

Controlling is a pervasive function: It means, it is performed by managers at all levels

and in all type of concerns
 Need of Control

1. To minimize the dishonest behaviour of employees

2. To discover the deviation in the management

3. To minimize the mistakes of employees and

processes
4. To indicate the corrective acting
Engineering and Technology
Management
 What is Engineering?
• The profession in which a knowledge of the mathematical and natural
science gained by study, experience, and practice is applied with
judgment to develop ways to utilize, economically, the materials and
forces of nature for the benefit of mankind

What is Management?
• A set of activities (including planning and decision making, organizing,
leading and control) directed at an organization's resources (human,
financial, physical and informational) with the aim of achieving
organizational goals in an efficient and effective manner.
 Engineering Management
• Engineering Management is concerned with the direct supervision of

engineers and the management functions (planning, organizing,

leading and controlling) in a technological organization.
• Prepare engineers to become effective leaders in meeting the

challenges in this new millennium

 Major Premises
• Technology and business savvy represents a very powerful combination of
great demand in society

• Market environment is rapidly evolving (changing marketplace complexities,

web-based technologies, globalization)

• Leaders with understanding of technology and management perspectives

are needed

• Engineers with proper management and leadership training have great

opportunities to add value
 Typical Engineering Activities
• Design/development of products/processes

• Project engineering/management

• Value engineering and analysis

• Technology development and applied R&D (laboratory, field)

• Production/manufacturing and construction

• Customer service
Work of an Engineer As Technical Contributor
• Understand objectives of tasks specified

• Develop action plan for implementation

• Define standards (performance metrics)

• Select methodology/techniques

• Implement task with proper efforts

• Generate results and secure value

• Report findings (impact, lessons)

 Aims

• Make engineers more effective as technical contributors

(understand managerial points of view, effect teams
coordination, drive to add value)

• Ready engineers for managerial positions (managerial

functions, success factors, leadership talents,
business/management perspectives, expectations,
contributions)
 Dual Aims
Make engineers more effective as
Make managers more effective in
technical contributors (understand
decisions involving technologies
managerial points of view, effect teams
(understand engineering language,
coordination, drive to add value)
limitations and possibilities)

Ready engineers for managerial

Ready managers for contributing
positions (success factors, leadership
effectively in the management of a
talents, business/management
technology-critical organisation.
perspectives)
 Henri Fayol (1841-1925)
Mining Engineer

Five primary functions of management:

• forecasting

• planning

• commanding

• coordinating

• controlling (feedback->adjustment)
Engineering Management Functions
 Engineering Management Functions
• Planning (forecasting, setting objectives, action planning, administering

policies, establishing procedure)

• Organizing (selecting organizational structure, delegating, establishing

working relationship)

• Leading (deciding, communicating, motivating, selecting/developing people)

• Controlling (setting performance standards,

evaluating/documenting/correcting performance)
 Skills for Technical Managers

Administrative
Leadership
Skills
Skills

Technical Skills
 Managerial Decision Making
• What, where, who, how – managers faces
numerous and challenging decisions

• Decision making qualities - knowledge, information,

and decision making skills

Management by intuition?
Challenges In the Management
 Challenges - Inside
• Implement projects/programs;
• manage people, technologies, and resources to add value;
• develop new product features to enhance company
competitiveness;
• define, control and reduce costs to improve profitability;
• initiate technology projects to sustain company position
 Challenges - Outside

• Keep side by side of emerging technologies and apply them to

strengthen company’s core competencies;
• apply web-based tools to enhance operations and foster customer
relations;
• identify best practices to improve engineering operations and surpass
them;
• create supply chain networks to derive speed, quality and cost benefits
 Challenges - Present
Do things right to keep company operating smoothly; use Balanced Scorecard to
monitor non-financial and financial performance; control costs and eliminate wastes to
attain profitability in the short-run

Challenges - Future
Seek e-transformation opportunities to create company profitability in the long-run;
introduce new generation products timely; create vision for the future related to
technologies; Define what should be done for technology-based success in the future
 Challenges - Local
Utilize resources to best achieve company’s objectives; take ethical and lawful actions
while taking into account local conditions; maintain and nurture/protect local professional
networks; share lessons gained with people at other company sites

Challenges - Global
Apply location-based resources to realize global economies of scale and scope for
achieving cost and technology advantages; develop global professional networks; acquire
a global mindset; exercise leadership roles in international settings
 Tips for Engineering Managers
• Demonstrate Technical Competence & Innovative capabilities

• Brush Up Communications skills (ask, listen, write and talk)

• Show unfailing reliability to induce trust and confidence

• Be Proactive in seeking challenging tasks

• Exhibitreadiness for assuming larger responsibilities (take

courses, practice skills, gain experience)
THANK YOU