MGMT 111

Principles of Management
BBA-BI, 2nd Semester

22/Sept./2022
 Unit I: The Nature of Management
Chapter 1 Introduction to Management
Chapter 2 Management Theories
Chapter 3 The Environmental Context of
Management

Introduction to Management-Learning Objectives

Know the concept, essence/characteristics, functions/process and principles of
management.
Understand levels/hierarchy of management.
Describe the types of managers.
Know managerial roles and skills.
Discuss the emerging challenges for management.
Concept/Definition of Management
Organizations are established for achieving certain goals
and they should perform a number of activities in a
systematic and scientific way using different resources.
All the organizations require management for survival
and growth.
It is a universal phenomenon.
The word management is constituted with three words
i.e., manage+men+t
Which means to manage human resources tactfully for
the achievement of organizational goal.
 The concept of management may be
understood in a number of ways:
1. As a noun/group: Management refers to all those
persons who perform the task of managing an
organization. Management has a systematic body of
knowledge. Hence it may be regarded as a science.
For the application of the knowledge, certain ways
As a
and skills are necessary. Therefore, it may alsoNoun
be
regarded as an art. (Group)
2. As a process: Management refers to a
Concept
series of interrelated functions such as of
planning, organizing, staffing, directing and Managem
controlling. ent
3. As a discipline: Management is the
As a
branch of knowledge concerned with As a
the study of the principle and Disciplin Process
practices of administration. e
Notable definitions of Management
 Henri Fayol “To manage is to forecast and plan, to organize, to
command, to coordinate and to control.”
 Koontz O Donnel “Management is the art of getting things done
through and with people in formally organized groups.”
 Ricky W. Griffin “Management is a set of activities (including
planning and decision making, organizing, leading and
controlling” directed at an organization's resources (human,
financial, physical and information) with the aim of achieving
organizational goal an efficient and effective manner.”
 Management is the process of getting things done through others
in systematic manner for achieving predetermined objectives.
 In other words, all the activity done by managers such as
planning, organizing, staffing, directing and controlling is
management.
 Essence/Characteristics/Nature of
Management
Management is a set of Universal and pervasive
activities directed towards Goal oriented
the attainment of goals. It Continuous process
has certain characteristics
Multi-dimensional activity
as discussed below:
Group activity
Dynamic function
Both a science and an art
A profession
Multi-disciplinary
 Principles of Management
Management is based on certain principles and these
principles are the facts and truths gained through
observation and experiment.
The 14 principles of management as stated by Henri Fayol
are discussed below:
Division of Labor Initiative
Fair
Authority and Responsibility
Recommendation

Unity of Command Stability of Tenure

Unity of Direction Scalar Chain

Subordination of
Equity (Justice) Individual Interest to
General Interest
Centralization and
Order Decentralization

Discipline Esprite de Corps

 Management Theories
Assignment
Classical Theory
 A. Scientific Management Theory Group A
 B. Administrative Management Theory Group B
 C. Bureaucratic Theory Group C
Behavioral Theory
 A. Human Relations Movement – Hawthorne Studies Group D
 B. Emergence of Organizational Behavior- Maslow’s Need Hierarchy Theory
 C. Herzberg’s Two Factor Theory Group E
 D. McGregor’s Theory X and Y
Management Science Theory Group F
System Theory Group G
Contingency Theory Group H
Contemporary perspectives on management
Process and Functions of Management
Process is a systematic way of doing things; management is a
process.
Functions constitute the essence of management process.
Managerial function includes all managerial activities from
setting objectives to taking essential steps to ensure and
achieve organizational objectives.
Fayol has specified planning, organizing, commanding,
coordinating and controlling as the function of management.
Luther Gulick has summarized the function of management
as POSCORB where P=Planning, O=Organizing, S=Staffing,
D=Directing, CO=Coordinating, R=Reporting and
B=Budgeting.
 In general following are the functions
and process of management:
Planning

Organizing
Supervision

Function
and Process Staffing Motivation
of
Managemen
t Directing Leadership

Communication
Controlling

Coordination
1. Planning
 Planning is the basic function of management.
 Planning is deciding in advance - what to do, when to
do and how to do.
 It bridges the gap between the present state and desired
future state.
 The effective planning requires an active participation
of the entire organization.
 Planning involves:
 Development of vision, mission, goals and strategies.
 Formulating system, policies and procedures.
 Preparation of programs and budget.
2. Organizing
 Organizing is the process of defining the essential
relationships among people, tasks and activities of an
organization in a way that the resources are integrated
and coordinated effectively.
 Organizing involves:
Identification of activities.
Classification or grouping of activities.
Assignment of duties.
Delegation of authority and creation of responsibility.
Coordinating authority and responsibility relationships.
3. Staffing
 Staffing is a key managerial function related to hiring and retaining
a suitable workforce, both at managerial as well as non-managerial
levels.
 Staffing has greater importance in the modern organizations due to
the advancement of technology, increase in size of business, the
complexity of human behavior, and workforce diversity.
 Staffing involves:
 Manpower planning.
 Recruiting employees,
 Training and development.
 Compensation management.
 Motivating employees.
 Performance appraisal.
 Promotions and transfers.
4. Directing
 Without directing the above functions of management i.e., planning,
organizing and staffing are worthless.
 In simple word, it is a creative work of guiding and encouraging the
workers to work effectively towards organizational goal achievement.
 It consists of human factors.
 Directing includes:
Supervision: Overseeing the work of subordinates for work efficiencies.
Motivation: Inspiring, stimulating or encouraging the sub-ordinates for work
efficiencies.
Leadership: Guiding and influencing the work of subordinates in desired
direction.
Communication: Passing information, experience, and opinion from one
person/Dept. to another.
Coordination: Synchronizing works among different departments and groups to
bring unity of action among them.
5. Controlling
 Controlling involves establishing
performance standards, comparing them with
the actual performance and taking corrective
actions if unfavorable variation exists. Correctiv Setting
 The main purpose of controlling is to ensure e Action Standards
that everything occurs in conformity with the Control
standards.

 Controlling involves the following steps: Finding and

Measuring
Analyzing
Performance
Establishment of performance standard. Deviation

Measurement of actual performance.

Comparison of actual performance with the
standards and finding out deviation if any.
Analyze the reasons of deviation.
Take corrective action of required.
 Managerial Hierarchy and Levels
There are different levels of management which are
determined by the organizational structure. There are
commonly three levels of management.
1. Top Level Management
 This is the highest level in the organizational hierarchy.
 It includes the board of directors, chief executive officers, president and
general manager.
 They are responsible for formulating the authority of the organization and
also plays a significant role in the mobilization of organizational resources.
 The top level management of an organization performs the following
functions:
 Formulate vision, mission, goals, strategies and policies of the organization.
 Appoint the executive for the middle level, i.e., departmental managers.
 Issue necessary instructions for the preparation of departmental budgets, procedures, and
schedules.
 Provide guidance and direction to middle and lower level.
 Control and coordinate the activities of all departments.
 Maintain relation with the outsiders.
 Be responsible towards the shareholders and society.
2. Middle Level Management
 Middle level management creates a link between the top level and
lower level management.
 It includes departmental and division heads and managers.
 They are responsible for implementing and controlling plans and
strategies formulated by the top executives.
 The middle level management performs the following functions:
 Execute the plans of the organization as per the policies and directions of the top
management.
 Work as bridge between top level and lower level management.
 Make plans for departments/units.
 Train the lower level management.
 Communicate the goals and policies to the lower level.
 Communicate important information to the top level.
 Evaluate performance of lower managers.
 Inspire the lower level managers for better performance.
3. Lower Level Management
 The lower level management is also called operational level
management.
 It consists of supervisors, foreman, section officers, and the
superintendent. It directly interacts with the workers.
 The lower level management performs the following functions:
 Assign jobs and tasks to the worker.
 Guide and instruct workers for day to day activities.
 Maintain the quality and quantity of output.
 Communicate the lower level issues to the top level and organizational goals and
policies to the workers.
 Help to solve the grievances of the workers.
 Supervise and guide/train the workers.
 Arrange necessary resources for getting the things done.
 Prepare periodical reports about the performance of the workers and submit to the
middle level management.
 Comparison of Levels of Management &
their tasks
Characteristics Top Level Middle Level Lower Level
Management Management Management
1. Focus on High Medium Low
policy
formulation and
strategy
2. Time span Long-range Intermediate range Short-range
3. Skill required Creative Persuasive Operative
4. Scope Very large Large and functional Small and sub-
functional
5. Number of Few Moderate Many
persons involved
6. Evaluation Difficult Less and difficult Easy
7. Nature Complex Less and complex Simple
 Managerial Skills and Roles
 Managerial Skills:
The success of any business or organization mainly depends on the
people working at the firm. So the management of these people and
the resources become a matter of huge importance.
And this is where the skills and talents of an effective manager
come in.
Managerial success primarily depends on performance rather than
personality traits. A skill is the ability to translate knowledge into
performance.
Any manager, to be effective in his job and duties must possess
certain skills. Some such important skills and talents every
effective manager must have i.e., Technical Skills, Human Skills &
Conceptual Skills.
Cont...
Research by Robert L. Katz in 1970 found three
essential skills or competencies among managers.
 Technical Skills
Technical skills refers to the manager’s knowledge and
ability to use different techniques to achieve their
goals.
Technical skills involve the knowledge about
processes, equipment, techniques etc. and also the
ability to carry them out like boost sales, design
different types of products and services, and marketing
the services and the products.
Technical skills are most important for lower level
managers. As we go through a hierarchy from the
bottom to higher levels, these skills lose their
importance.
 Human Skills
Another important skill of an effective manager is
his/her human skills. This will include his/her ability to
work, motivate, communicate, direct and understand
people.
Managers with good human skill are able to get the
best output from subordinates.
They know how to motivate, communicate, lead,
inspire and trust subordinates.
Human skills are equally essential for all levels of
managers.
 Conceptual Skills
The conceptual skills of a manager involve understanding and
visualizing the company as a whole. These means the
manager is able to see and understand all the working parts of
an organization and understand how these pieces fall together.
So conceptual skills allow the manager to solve the problems
he/she is facing with more creatively and effectively.
It helps him/her understand complex situations and relations
and hence solve any problems that arise. It helps the manager
have a competitive advantage over his/her counterparts.
Conceptual skills are especially important for top-level
managers since they develop long-range plans for the future
direction of their organization.
 Managerial Roles
Traditionally, most employees believed that a manager was
certainly someone who sat comfortably in his office thinking
and planning and giving instructions to employees.
However, over time a manager’s behavior was divided into
functions and managerial roles.
 Managerial Roles:
A manager should perform a number of activities which are
verified in nature. Managerial roles refer to a specific
categories of managerial behavior.
The role of a modern manager is very complex and multi-
dimensional.
 Story behind Managerial Roles
In 1973, Henry Mintzberg – a Canadian academic and author on business and
management published a book called ‘The Nature of Managerial Work’.
Mintzberg based his book on data derived from the time diaries of 5 male
executives.
The data suggested that managers actually did not spend a lot of time on
planning or strategizing. On the contrary, they spent most of their day
answering telephone calls, solving problems, dealing with people, responding
to crises, and had to deal with interruptions regularly.
He found that managers could not stick to one task since they were constantly
being interrupted either by a phone call or a crisis. Over the years, managerial
roles have become busier and more stressful.
So much so, that managers find their days never-ending. With an
economy that runs 24x7x365, multiple chains of command, numerous
projects, and frequently changing technology, etc., managers have a tough
time on their jobs.
 Managerial Roles
For better understanding, Mintzberg categorized all
activities into ten managerial roles (grouped into three
major categories) performed over the course of a day.
These are as follows:
 Interpersonal Role
 The interpersonal roles of a manager involve interactions and
communication effectively with people inside and outside the
organization to maintain a good relationship with them.
 These people include peers, subordinates, superiors, suppliers,
customers, government officials and community leaders.
 All these interactions requires an understanding of interpersonal
relations.
 The interpersonal roles of a manager involve the following:
Figurehead – includes symbolic duties which are legal or social in nature.
Leader – includes all aspects of being a good leader. This involves building
a team, coaching the members, motivating them, and developing strong
relationships.
Liaison – includes developing and maintaining a network outside the office
for information and assistance.
 Informational Roles
 Interpersonal roles (as discussed earlier) give birth to informational
roles. Information is the lifeblood of an organization.
 This role is related with information collection, processing, and
dissemination.
 Under this role, manager plays the following three major roles:
Monitor – includes seeking information regarding the issues that are
affecting the organization. Also, this includes internal as well as
external information.
Disseminator – On receiving any important information from internal or
external sources, the same needs to be disseminated or transmitted
within the organization.
Spokesperson – includes representing the organization and providing
information about the organization to outsiders.
 Decisional Roles
 Interpersonal and informational roles together give birth to decision
roles.
 Managers make various organizational decisions.
 The following are the key decisional roles of a manager.
Entrepreneur – involves all aspects associated with acting as an
initiator, designer, and also an encourager of innovation and change.
Disturbance handler – taking corrective action when the organization
faces unexpected difficulties which are important in nature.
Resource Allocator – being responsible for the optimum allocation of
resources like time, equipment, funds, and also human resources, etc.
Negotiator – includes representing the organization in negotiations
which affect the manager’s scope of responsibility.
 Emerging Issues and Challenges for
Management
The business environment
since last few decades has
witnessed a rapid change
mainly due to rapid
development in transportation
and communication network,
innovation of new knowledge,
globalization of business,
combination of multi-cultured
professionals and so on.
Emerging issues and
challenges for management
are:
 Practice Questions?
Give the concept of management and explain its characteristics.
Why management is a dynamic function?
“Management is an art and a science”; explain?
Differentiate Managerial Skills and Managerial Roles”.
What are the functions of management? Explain the roles that a
manager has to perform in an organization.
What are the different levels of management generally found in
organization? Explain the corresponding management skills
required at each of these levels.
Define management? Explain the principle of management.
What are the emerging issues and challenges in management?
Good Luck!!