PIDAM UNIVERSITY

Course: Principles of Management

Semester: One

Chapter One: Introduction to Management

Academic Year: 2022-2023

Date: January 2023

 HISTORY OF MANAGEMENT
 The study of management, as a separate
discipline, started recently in the 19th
century.
 During the 19th century, inventors of
products and creators of technological
advances Promoted an industrial revolution
which demanded skills, knowledge and
attitudes beyond those possessed by
untrained owner managers of small
enterprises.
 When the factory system of production
came to be established, there is an
 DEFINITIONS OF MANAGEMENT

 Every business concern makes use of

Manpower, Money, Materials/Machinery and
Information.
 Management coordinates these factors or
inputs to obtain maximum possible results.
 Different experts have defined management
in different ways. However, J.L Massie says
“Management is defined as the process by
which co-operative group directs action
towards common goals’’.
 This process involves techniques by which a
distinguishable group of people (managers)
 CONT…..
 “Management is that process by which
managers create, direct, maintain, and
operate purposive organizations through
systematic, coordinated, cooperative
human effort.” Daton E. McFarl
 “Management is a social and technical
process which utilizes resources,
influences human action, and facilitates
changes in order to accomplish
organization goals”. Haimann & William G.
Scott
 CONT……
 “Management is the process of planning,
organizing, actuating, and controlling an
organization's operations in order to achieve
coordination of the human and material resources
essential in the effective and efficient attainment
of objectives.” Robert L Trewatha and M. Gene
 ‘To manage is to forecast and plan, to organize,
to command, to coordinate and to control.” Henri
Fayol
 “Management is a process consisting of Planning,
Organizing, actuating, and controlling performed
to determine and accomplish objectives by the
use of human beings and other resources”.
George R Terry.
 OBJECTIVES OF MANAGEMENT
 The management of the organization and its
various activities are done to achieve
certain predetermined targets following are
the examples of such targets;
1. Efficiency:- The management objective
can be to increase efficiency by improving
productivity by maximizing output with the
same amount of inputs.
2. Optimization of Resource Utilization:-
management may set a target to reduce
wastage of time, money, and efforts so as to
optimize the resource utilization.
 CONT…….
3. Higher level of customer Satisfaction:-
The objective can be to know the voice of
customer and develop safe, secure and
economical products which can generate a
higher level of satisfaction.
4. Better Workforce: Management tries to
build a team of efficient workers who are
happy and satisfied with the organization.
They are cooperative and contribute to
the goals of the organization.
 CONT….
5. Wealth Creation for the stakeholders:-
Management may set the objective to
create wealth for the stakeholders like
shareholder, financers, employees,
customers, vendors, suppliers and society.
6. Quality Assurance and enhancement:-
The objectives can be to establish and
implement quality management system to
improve various processes and products of
the organisation to bring better products in
the market which can delight the customer
 CHARACTERISTICS OF MANAGEMENT
 The salient features which highlight the
nature of management are as follows:
1. Management is universal: the basic
principles of management apply more or
less in every situation.
2. Management is purposeful:
management exists for the achievement
of specific objectives.
All activities of management is goal
oriented.
 CONT……
3. Management is an integrative force: The
essence of management lies in the
coordination of individual efforts into a team
effort.
4. Management is a social process:
management is done by people, through
people and for people. It is concerned with
interpersonal relations.
5. Management is multidisciplinary:
management has to deal with human behavior
under dynamic conditions.
 CONT…….
6. Management is a continuous process:
Management is a dynamic and on-going process.
The cycle of management continues to operate
so long as there is organized action for the
achievement of group goals.
7. Management is intangible: Management is
unseen or invisible force. it cannot be seen but
its presence can be felt everywhere in the form
of results.
8. Management is an art as well as a science:
It contains a systematic body of theoretical
knowledge and it also involves the practical
application of such knowledge.
 MANAGEMENT – ART OR SCIENCE?
 Management as an art
Management is essentially an art because of
the following reasons:
1. The process of management involves the
use of knowledge and skills. Every manager
has to apply certain knowledge and skills
while dealing with people.
2. Management seeks to achieve concrete
practical results. Profits, growth, etc
 CONT………..
3. Like any other art, management is creative. It
brings out new situations and makes resources
productive management is one of the most
creative arts, because it involves the
accomplishment of specific goals in a changing
environment.
4. Like any other art, management is a
personalized process. Every manager has his own
approach and technique depending upon his
perception and the environmental conditions.

 Good management is efficient and the success

of manager is measured by the effective
 MANAGEMENT AS A SCIENCE
Management is science because of the
following reasons:
1. There is systematic body of knowledge in
management. For example, principles which
serve as guidelines for delegating authority
and thereby designing an effective
organization structure.
2. The principles of management have been
developed through continuous observation and
empirical verification.
3. The principle of management are capable
of universal application.
 CONT…….

4. Management theory helps to examine

and evaluate alternative courses of action
to resolve a given problem.

 Management is social science because it

involves the study of human behavior.
 Thus, management is both an art as well
as a science.
 Science and art are complementary to
each other.
 MANAGEMENT VS. ADMINISTRATION
 There has been a controversy/argument
on the use of the two terms –
management and administration.

These three points of view are explained

below:
 Administration is a part of management
 According to the European school of
thought, management is a wider term
including administration in organizations
and it has been supported by many other
 CONT…….
Administration is different from
Management
 Administration is a higher level activity
while management is a lower level
function.
 Administration is a determinative function
concerned with the determination of
objectives and policies while management
is an executive function involving the
implementation of policies and direction
of efforts for the achievement of
objectives.
 CONT……
 Administration and management are one.
 Many writers like Henry Fayol, William
Newman, George Terry, Koontz and
O’Donnel and others make no distinction
between management and administration.

 They say “all undertakings require the

same functions and all must observe same
principles”.
 The term administration is more popular in
government while management is
commonly used in private business world.
 CONT……
 Administrative management involves
determination of objectives and policies
whereas operative management is
primarily concerned with the execution
of plans for the achievement of the
objectives.
 Every manager spends a part of his Time
on administrative management and the
remaining time on operative
management.
DISTINCTION BETWEEN ENTREPRENEUR & MANAGER
 An entrepreneur is the person (or group
of persons) at the top of any business
concern who undertakes financial and
legal responsibility for the success and
failure of the concern.
 A manager is an employee of the
entrepreneur. His job is to work for the
accomplishment of the goals and
objectives of the entrepreneur.
 In the case of sole proprietor and the
managing partner of a firm, one person
CONT……
 The main difference between an
entrepreneur and a manager is with
regard to the degree of freedom
enjoyed in his work.

 Entrepreneur is free to determine the

objectives based on his assessment,
beliefs and values.
LEVELS OF MANAGEMENT
 The number of levels of management
in an organization will depend on its
size, technology and diversity in its
range of production, But for greater
efficiency and productivity, the levels
of management should be kept to the
minimum.
 The different levels of management
may be classified into Three
categories;
 CONT……
1. Top Level Management.
 Top management of a company consists of
the board of directs and chief executives
(managing director, general manager,
president, chairman, etc).
 Top management is the ultimate source of
management authority and it is
accountable for overall management to
the shareholders of the company.
 CONT……..
2. Intermediate & Middle Level Management
 Intermediate and Middle Management
comprises departmental or divisional heads.
e.g marketing manager, finance manager,
personnel manager, etc. each one of these
managers is responsible for the efficient and
coordinated functioning of his own
department in accordance with the basic
objectives and policies laid down by the top
management.
 CONT……..
 This level of management also consists of
deputy heads of departments and sectional
officers such as plant manager, area sales
manager, or branch manager, office
manager, chief accountant, etc.
 this level interpret and explain policies
framed by top issue detailed instruction
for the operations, integrate various parts
of a division, motivate supervisory
personnel and train supervisory and
cooperative personnel.
CONT…….
3. Low Level Management.
 This is the lowest level of management.
Foremen, front line supervisors, sales
officers are examples. They serve as link
between management and workers.
 They plan day-to-day activities, advice and
assist workers by explaining work
procedures, maintain discipline and good
human relations among workers and report
feedback information.
 SKILLS OF MANAGEMENT
 In modern business, the job of a manager has
become very complex. Different types of
skills are required to manage effectively a
large organization in a dynamic environment.
 These skills of a manager are classified as
three:
 Technical skills.
 These refer to the ability and knowledge in
using the equipment, techniques and
procedures involved in performing specific
tasks. These skills are most important at the
supervisory level of the management
 CONT………..
 Human/ Interrelation Skills.
 These consist of the ability to work
effectively with other people both as an
individual and as members of a group.
These are required to win co-operation
of others and to build effective work
teams.
 These human skills are necessary for all
levels of management.
 CONT…..
 Conceptual skills.
 They comprise the ability to see the whole
organization and the inter-relationship
between its parts. Such skills help the
manager to conceptualize the
environment, to analyze the forces
working in a situation and to take broad
and farsighted view of the organization.
Conceptual skills are very important for
top management.
 Thus technical skills deal with jobs, human
skills with person and conceptual skills
with ideas.
 IMPORTANCE OF MANAGEMENT
 Management is indispensable in all
organizations whether a business firm, a
government, a hospital, a college, a club, etc.
according to Drucker “Management is
dynamic life giving element in every
business and without it the resources of
production remain resources and never be
production.”
 It is very important management function as it
is the base on which the entire functioning of
organization depends. The success and
existence of the organization depends on the
quality of Management.
 CONT…….
 We can represent the importance of
Management by highlighting following points:
1. Provides Direction: Management provides the
direction and sense of purpose for the
organization, Management provides the broad
targets to be achieved by the organization and
also define the guidelines in terms of policy and
procedure following which the organization try to
achieve the set targets.
2. Reduces risk of Uncertainty: Future is always
full of uncertainties. A business organization has
to function in these uncertainties. It can operate
successfully if it is able to predict the
uncertainties.
 CONT…….
3. Coordination: Management helps in setting
better coordination among interdepartmental
activity and clearly lay down the area of
freedom in the development of various sub-
plans.

4. Economy in Operation: Management ensures

economical operations because of emphasis on
efficiency. Since Management involves the
selection of the best possible courses of action,
it is implied that best results would be achieved
at the least possible cost.
 CONT…..

5. Facilitation of Control: Management

ensure better control as when the
activities are done on a planned manner
then it is easy to evaluate them as we
know what is predicted or standard and
what is actual, hence Management
provides parameters to know whether the
actions are going accordingly or not.
 CONT……..

6. Encouragement to Innovation:
Management helps innovative and creative
thinking among the managers because many
new ideas come to the mind of a manager
when he is Management. It creates a forward-
looking attitude among the managers.
7. Increase in Competitive Strength:
Effective Management gives a competitive
edge to the enterprise over other enterprises
that do not have Management or have
ineffective Management.
 CONT……
8. Improves morale: Management helps
in defining the goals and the steps to
achieve them, which in turn helps in
clearly defined what is expected from
the employees and how he is going to
achieve it, this helps in building positive
morale in the employees.
 FUNCTIONS OF MANAGEMENT
 The process of management consists of
several interrelated activities. These
activities are known as Functions of
Management. Different authorities on the
subject have given different classification of
the managerial functions.
 The various functions are mentioned by
different experts but the most widely
accepted are functions of management
given by KOONTZ and O’DONNEL are
Planning, Organizing, Staffing, Directing and
Controlling.
CONT…….
 Planning: it involves determining the
objectives and selecting course of
action to achieve them. Planning
comprises activities of forecasting,
establishing objectives, policy making,
scheduling, budgeting, strategy
formulation and research.
 CONT………..
 Planning is a fundamental process to
ascertain and define the objectives of
the organization, the goals that have to
be achieved for the fulfillment of the
objective, planning involves deciding in
advance what to do, when to do, where
to do, how to do, who will do.
 It provides the base for the functioning
of all the activities in the organization.
 CONT……..
 Organizing: it is process of
establishing harmonious authority-
responsibility relationships among the
members of the enterprise.
Organizing includes functionalization,
divisionalisation, departmentation,
assignment of duties, and delegation
of duties.
 CONT……..
 Organizing is process to plan and
arrange organization’s resources like
materials, infrastructure and
technology, human resource, finance in
such a way that organisational
objectives can be achieved in the
minimum effort.
 It involves division of work, authority
and responsibilities among departments,
individual and groups defined in terms
of organizational structure
 CONT………
 Staffing: this is the process of filling all
positions in the organization with adequate
and qualified personnel.
 This includes Recruitment, Selection,
training, compensation, Performance
Appraisal, Development and etc.
 Staffing is a process to employ right kind of
person at all the designation defined by the
organization in right numbers, staffing
involves to forecast the human resource
requirements for the organization, to recruit,
select and place the individuals on the job
 CONT…….
 Directing: this function is guiding, supervising,
motivating and leading people towards the
attainment of planned targets of performance.
 The process of supervising, guiding and
eliminating barriers to performance of the
subordinates is directing, employees
direction is that aspect of management
which deals with initiating the work,
monitoring the activities to evaluate
whether the activities are done according to
the plan or not.
 CONT………
 Controlling: the process of ensuring
that the organization is moving in the
desired direction.

 It includes setting standards, recording,

measurement, reporting, evaluation,
corrective actions, etc.
CONT………
 Controlling means measurement of
accomplishment against the standards
and correction of deviation if any to
ensure achievement of organisational
goals.
 The purpose of controlling is to
ensure that everything occurs in
conformities with the plans and
standards.
INTERRELATION OF MANAGERIAL FUNCTIONS

MGT
Process
FUNCTIONS AND MANAGERIAL LEVELS
 The relative significance of different
functions may not be the same at all
levels of management.

 The time spent on various functions

may differ from one level to another.
In general planning and organizing are
more important at higher levels of
management.
 CONT……..
 Low level executives spend comparatively
a greater part of their time on directing
and controlling functions.
 A middle level manager is likely to divide
his time more evenly among different
functions.
 At higher levels, planning is long term
and strategic while at lower levels it
tends to be short term and operational
planning.
 PRINCIPLES OF MANAGEMENT
 A principle is a fundamental statement
of truth that provides a guide to thought
and action of management.
 It establishes a cause and effect
relationship between two and more
variables.
 The principles of management lay down
guidelines for improving management
practice.
 CONT……
 These principles are provided by Henry
Fayol and widely accepted:
1. Division of work: it helps a person to
acquire an ability and accuracy with which he
can do more and better work with the same
effort.
2. Authority and responsibility: Authority
means a formal or legal power in a particular
job or position that empowers the holder of
that job to perform his task.
Responsibility is the obligation of a
subordinate to perform a duty, which has been
assigned to him by his superior
CONT……
3. Discipline: it is respect for
agreements which are directed at
achieving obedience, application,
energy and outward marks of respect.

4. Unity of command: every

subordinate should receive orders and
be accountable to only one supervisor.
 CONT…….
5. Unity of direction: according to this
principle, each ground of activities having
the same objectives must have one head
and one plan.
6. Subordination of individual to General
Interest: efforts should be made to
reconcile individual interest with common
interests.
7. Remuneration of personnel:
remuneration must be just and fair and
provides maximum satisfaction to both
sides.
 CONT…….
8. Centralization: the question of
centralization and decentralization is a
matter of finding the optimum degree for
the particular concern.
9. Scalar chain: it refers to the chain of
supervisors ranging from the ultimate
authority to the lowest level in the
organization.
10. Order: it concerned with the
arrangement of things and the placement of
people.
11. Equity: managers should be fair and
impartial in their dealings with subordinates.
 CONT….
12. Stability of tenure: employees cannot
work efficiently unless job security is assured
to them.
13. Initiative: it refers the freedom to think
for oneself and use of discretion in doing
work. It develops the interest of employees
in their jobs and provides job satisfaction.
14. Esprit de corps: this requires harmony
and mutual understanding among the
members of an organization.
Management shouldn’t follow the policy of
divide and rule.
 NATURE OF MANAGEMENT PRINCIPLES
 The principles of management contain the
following characteristics:
1. Universality of Principles: Management
principles are fundamental truths of general
validity. They can be applied in different types
of organizations.
2. Dynamism: Management principles are
flexible guides rather than hard and fast rules.
Two management situations are seldom alike
in all respects and therefore management
principles have to be modified with changes in
the environment of the organization.
 CONT…..
3. Relativity: They should be applied
according to the need of the organization
and demands of the situation.
DEVELOPMENT OF MANAGEMENT THOUGHT

 The contributions of many thinkers

have resulted in several schools of
thought as regards the study of
management.
 Some of these schools of thought or
approaches to the study of
management are given below:
 CONT……..
1. Classical/Traditional Approach
 This approach evolved in the 20th century,
and over time it branched into three sub
approaches:
A. Scientific management: it was to
improve manufacturing efficiency through
more efficient utilization of physical and
human resources.
It was mainly developed mainly by engineers
and scientists, among whom F.W Taylor was
the pioneer.
 CONT…..

B. Administrative theory: this theory was

developed for efficient management of
organization. Henri Fayol and many other
pioneers emphasized the development of
basic functions of management with
particular emphasis on resources
coordination
C. Bureaucracy: This theory is based on
hierarchy of authority and web of rules
and regulations and was evolved by a
German sociologist Max Weber.
 CONT…
 Classical approach of management
recognizes the body of management
thought based on the belief that
employees have only economical and
physical needs and that the social needs &
need for job satisfaction is unimportant.
 Accordingly it advocates high
specialization of labor, centralized
decision making & profit maximization.
 Behavioral Approach

This approach focuses on physiological

and sociological processes that influence
employee performance.

While the classical approach focused on

the jobs of the workers, behavioral
approach focuses on the workers in these
jobs.
CONT….
 Two branches contributed this
approach: Human Relation Movement
and the development of
organizational behavior.

 Human relation movement considers

that a worker is not a simply an
economic man but also a social man.
 MANAGEMENT SCIENCE APPROACH
Management science approach was evolved
after Second World War II.
It involves the application of sophisticated
quantitative mathematical techniques for
solving managerial problems.
In this approach management information
system and other techniques should be
used for making rational decision making.
Also, with the help of mathematical
models, a manager can test different
values of each variable until an acceptable
solution is found.
 THE SYSTEM APPROACH

 This approach was developed in the late

1950’s. According to this approach, an
organization is a system consisting of
many interrelated and interdependent
parts or subsystems.
 These elements are arranged orderly
according to some scheme. As a system
an organization draws inputs (energy,
information, materials, etc) from its
environment.
CONT……
 It transforms these inputs and returns
outputs back into the environment in
the form of goods and services.
Organization is an open system and it
interacts with its environment.
 It is also a dynamic system as the
equilibrium in it is always changing.
THE CONTINGENCY APPROACH
 This approach to management
emerged from the real life experience
of managers who found that no single
approach worked consistently in every
situation. The basic idea of this
approach is that no management
technique or theory is appropriate in
all situations.
 In other words, managerial practices
and styles will differ according to the
particular circumstances of the
FEATURES OF THE CONTINGENCY APPROACH
 The features of the contingency
approach are as follows:
1. Management is entirely situational:
There is no one best way of managing
an organization. What managers do
depends upon the circumstances of the
particular situation.
For example, people-oriented style may
succeed in a given situation but task-
orientation may be more effective in
another situation.
CONT…….
2. No organizational design can be
suitable for all situations: The suitable
design should be determined keeping in
view the technology, people , size and
environment of the enterprise.
An organization interacts with its
environment and must therefore adapt
itself to environmental changes.
THE END OF CHAPTER-1

ANY QUESTIONS?
LEVELS OF MANAGEMENT
 PIDAM UNIVERSITY
Course: Principles of Management

Semester: One
Chapter Two: PLANNING

Academic Year: 2022-2023

Date: 05 MAR 2023

Nature and Process of Planning

 Planning is deciding in advance what

to do, how to do it, when to do it,
who to do it and why we are doing.

 Planning is the most fundamental

function of management and It
precedes other functions.
 PLANNING
 Planning Is the process of setting goals
and objectives, developing strategies,
outlining activities, tasks and schedules
to accomplish the goals.
Its the primary managerial activity
that involves:
 Defining the organization’s goals
 Establishing strategy for achieving those
goals
 Coordinating organizational work activities.
 OBJECTIVES OF PLANNING
 Objectives are the ends towards
which the activities of an
organization are directed.
 They are known by different names,
e.g. goals, aims, purposes, targets,
etc.
 Setting up objectives is the first
step in planning.
OBJECTIVES OF PLANNING

Managers need Plan in order to

achieve;
1. Provides direction
2. Reduces uncertainty
3. Minimizes waste and redundancy
4. Sets the standards for controlling
5. It helps in Achieving Goals
CONT…….
 The Objectives of Planning Should have
the following characteristics:
 Objectives must be clear and specific
 Objectives must be measurable
 Objectives must be result-oriented : for
instance, the objective of increasing
sales by 10%.
 Objectives must be realistic, not
idealistic
 Objectives must always be valid
FEATURES OF PLANNING:
The Characteristics of Planning includes;
1. Planning is goal-oriented
2. Planning is a primary function of
Management
3. Planning is all pervasive
4. Planning is an intellectual process
5. Planning is a continuous process
6. Planning is forward-looking
7. Planning involves choice
8. Planning is an integrated process
9. Planning is directed towards efficiency
 TYPES OF PLANNING
 Planning can be classified on the basis of time,
nature and use of plans.
Various types of plan are explained as under;
1. Based On Time
 On the basis of time dimension, planning is
generally divided into long period plan and short
period plan.
A. Long period planning
 Long period planning normally covers a period
more than 5 years, though it can extend up to
twenty years or so.
CONT………
B. Short period planning
 This refers to determination of courses of
action for time periods extending up to
one to three years.
 Sometimes, plans beyond one year period
are called medium term plans.
 A short term plan is relatively more
precise and less flexible
 TYPES OF PLANNING CONT…
2. Based on the Nature
On the basis of nature or level of planning,
there can be the following types of planning.
A. Strategic planning
 Strategic planning refers to the process of
formulating a unified, comprehensive and
integrated plan relating to the strategic
advantages of the firm to the challenges of
the environment.
 Strategic planning is long term in nature.
 CONT…..
B. Functional planning
 Functional plans are prepared for various
functional/departmental areas of business.
Production planning, marketing planning,
finance planning, etc.

C. Operational planning
 Operational planning is a short term exercise
designed to implement the strategies
formulated under strategic planning.
 The above two types of Planning are
based on strategic plans.
 TYPES OF PLANNING CONT…
3. Based on Use
A. Standing Planning
Ongoing plans that provide guidance for activities
performed repeatedly and it guides to solve
regular problems that is used again and again.

B. Multi-use planning
 Multi-use plans are used different purposes:
objectives, strategies, policies, procedures and
rules.
C. Single use/Ad-hoc planning is used once and
then it is discarded.eg programs, budgets & schedules
 OTHER ELEMENTS OF PLANNING

A. STRATEGIES
 Strategy is complex plan for bringing the
organization from a given
posture/attitude to a desired position in
a future period of time.
 It is an administrative course of action
designed to achieve success in the face
of difficulties.
 The process of strategic planning
(strategy formulation) involves the
following steps:
 CONT……….

1. Environmental analysis
 First of all the external environment of
the enterprise is analyzed to determine
the opportunities and threats for the
enterprise.
2. Self-appraisal
 The internal environment of the
enterprise (resources, capabilities,
etc.) is examined to know the strengths
and weakness of the firm.
 CONT……….
3. Strategic alternatives
 Alternative strategies are developed to deal
with the environmental forces. Eg. Offensive
or defensive strategy
4. Strategic choice
 The most appropriate strategy is chosen so
as to capitalize on the strengths of the
enterprise.
5. Strategy implementation
 Detailed operational plans are developed
and communicated to employees so as to
execute the chosen strategy
FOUR LEVELS OF STRATEGY- ADDITIONAL

The levels of strategy setting are

classified the following four Levels;

1. Corporate level strategy

2. Business level strategy
3. Functional level strategy and
4. Operational level strategy.
 B. POLICIES
 Policies are general statements or
understandings which guide or channel
thinking in decision making of subordinates.

 Policies facilitate quick and correct

decisions, save time and effort by pre-
deciding problems and facilitate uniformity
of action.
 Policy is a law, regulation, procedure,
administrative action, incentive, or voluntary
practice of governments and other
institutions.
 TYPES OF POLICIES
1. Organizational and functional policies;
In terms of scope, policies are two.
A. Organizational policies or basic policies
are used uniformly throughout the
organization.
B. Functional policies are derived from
organizational policies and guide people
in one department. EG. Sales, HR
Marketing and Finance Departments
 TYPES OF POLICIES- CONT…

2. Originated, appealed and imposed

 On the basis of origin, policies may be
classified as originated, appealed and
imposed.
A. Originated policies are deliberately
formulated by top management.
B. Appealed policies are formulated on request
of subordinates.
C. Imposed policies arise from the influence of
outside forces like government regulations.
 CONT……
3. General or specific policies
 As to the area of freedom, policies may
be classified as general and specific.
 General policies are stated in broad
terms to give freedom to units of the
organization.
 Specific policies are intensively defined
to restrict freedom of action.
CONT…….

4. Written and implied

 Written policies are declarations in
writing produced by the business or
government body.
 Implied policies are those inferred
from the behavior or conduct of
organizational members, particularly
of top executives.
 BUDGETS
A budget is a statement of expected
results expressed in numerical terms
for a definite period of time in the
future.
 Budgets serve as standards of
measuring actual performance.
 PROCEDURE
A procedure is a sequence of steps to be
undertaken to enforce a policy and to attain
an objective.
 It lays down the specific manner in which a
particular activity to be performed.
 It is a planned sequence of operations for
performing respective activities uniformly
and consistently
Procedures are different from policies and
methods. A policy is broad and general guide
to decision making while a procedure is an
operational guide to action.
 RULES
Rules are rigid and definite plans that
specify what is to be done or not done in
given situation.
 A rule provides no scope for
discretion/Choice and judgment.
 A rule may or may not be a part of a
procedure.
 For example The rule No smoking in the
factory and other public served
institutions eg. Hospitals and Schools.
 PIDAM UNIVERSITY
Course: Principles of Management

Semester: One
CHAPTER THREE: ORGANIZING

Academic Year: 2022-2023

Date: 21 MAR 2023

 MEANING OF ORGANIZING
 The term organizing is used in management in
two different senses – as a structure and as
a process.
 Organization is the structure of relationships
among jobs or a network of horizontal and
vertical authority relationships designed to
accomplish common objectives
 Organizing is considered as a basic function of
management. It is the process of creating
harmonious authority-responsibility
relationships between different parts of an
enterprise.
 CONT…
 It involves division of work into appropriate
specialized units and creating co-operative
relationships between them.
 According to Allen “Organizing is the process
of identifying and grouping the work to be
performed, defining and delegating
responsibility and authority, and establishing
relationships for the purpose of enabling
people to work most effectively together in
accomplishing objectives.”
 Organizing defines the role each individual is
to play and establishes relationships between
them. The two interpretations of the term are
complementary to each other.
IMPORTANCE OF ORGANIZING
 Sound organization structure can contribute to
the success of an enterprise in many ways. It
is, as a matter of fact, the backbone of
management.
It helps in achieving the following advantages:
1. Efficient Management
2. Enhances abilities
3. Co-ordination and Communication
4. Flexibility to change
5. Optimum Use of Human Resources
6. Stimulates innovation and creativity
 ORGANISATION THEORY

 Organizing theories means the study of the

structure, functioning and performance of
organization and the behavior of individual
and groups within them.
 There are various theories of an
organization, some common ones are
explained below:
1. Classical theory of Organizing
 Classical theory, dealing mainly with the
anatomy of a formal organization, owes its
origin to the scientific management
 CONT…….
 The classical theory is woven round
Four principles, which are as follows;

A. Division of labor
It is the pivot round which the classical
theory involves. The term is applied to
specialization of processes where the
production of a commodity is divided into
a number of processes each of which is
performed by a different person.
 CONT….
B. Scalar and functional processes
Scalar principles refer to the superior-
subordinate relationship existing in any
business organization structure.
Accordingly, superior communicate
instructions (command) down through the
organization, via various levels of
management to subordinates and receive
feedback information relating to the
operations performed at different levels.
 CONT…..
C. Structure
Organizational structure may be defined
as the prescribe patterns of work-related
behavior which are deliberately
established for the accomplishment of
organizational objectives.
Any structure implies a system and
pattern/design Specialization and
coordination are the key issues in the
design of an organization structure
 CONT…
D. Span of control
 It relates to the number of subordinates
whom a manager can effectively
supervise. According to Brech, “span
refers to the number of persons,
themselves carrying managerial and
supervisory responsibilities, for whom
the senior manager retains his
responsibility of direction and planning,
coordination, motivation and control.”
 MODERN THEORY
The modern organization theory,
which is of a recent origin, has a
conceptual analytical base and
places a great reliance on empirical
research data. It studies the
organization as a System.
 It is an integrative approach to the
study of organization, particularly a
business organization.
 CONT………
 Thus, the modern theory studies an
organization by identifying:
A. Its strategic parts
B. The nature of their mutual dependency
C. The process in the system which link
the parts together and enables their
adjustments to one another, and
D. The goals sought to be accomplished
 FORMAL AND INFORMAL ORGANISATION
 The formal organization refers to the
structure of jobs and positions with
clearly defined functions and
relationships. It is deliberately created by
top management for the realization of
enterprise objectives, and is bound by
established rules, regulations and
procedures. It defines the official
channels of communication and is based
upon the concept rational economic man.
 CONT….
 Informal organization refers to the
relationships between people in an
organization based not on procedures
and regulations but on personal
attitudes, prejudices, likes and dislikes.
 It is personal and relates social
interaction among people inside and
outside the enterprise, and gives social
satisfaction to persons.
 THE PROCESS OF ORGANIZING
 The building up of an organization
structure is an important function of
management.
 The process of organizing consists of the
following steps:
1. Determination and division of work
 The first step in organizing is to determine
the tasks required for the accomplishment
of established objectives. Fayol divided
business activities into technical,
commercial, financial, security, accounting
and managerial.
 CONT…….

2. Grouping activities
 The various activities identified
under the first step are then
classified into appropriate
departments and divisions according
to similarities and common purpose.
Such grouping of activities is known
as “Departmentation’’.
 CONT……..
3. Assignment of duties
 The individual departments are then
allotted to different positions and
individuals. The duties of every
individual are defined on the basis of
abilities and aptitude. Clear definition
of the responsibility of each is necessary
to avoid duplication of work and
overlapping of efforts. Every individual
is made responsible for the specific job
assigned to him
 CONT……
4. Delegation of authority
 Once the duties and responsibilities of
everyone have been fixed, he must be
given the authority necessary to carry
out the duties assigned to him. A chain of
command is created from top to bottom
through successive delegation of
authority.
 ORGANISATIONAL CHART
 An organizational chart is a diagram that
shows the organization structure of a
company.
 The purpose of drawing it, is to show all
concerned as to what is the organization
structure, how the company has been
divided into departments and
departments into sections, and most
important as to what responsibility and
duties are assigned to each officer.
VERTICAL ORGANIZATION
VERTICAL ORGANIZATION
 THE END

ANY QUESTION?
 PIDAM UNIVERSITY

COURSE: PRINCIPLES OF MANAGEMENT

SEMESTER: ONE

CHAPTER 4: STAFFING

LECTURE: SAID MOHAMED

ACADEMIC YEAR: 2022-2023

DATE: 26 MARCH 2022

 INTRODUCTION
 The human resources of an organization
are its most important resources
available to the organization,
contribute their work, talent, skills and
drive.
 Competent and dedicated performance
on their part goes a long way in
successful accomplishment of the
organizational goals.
 CONT……..
 sometimes distinction is made between staffing
and personnel management. Therefore, the
staffing function of management is concerned
with the acquisition, development and
maintenance of an efficient and satisfied team
of executives in an organization. It has come to
be recognized as an important function of
management.
 The staffing function has acquired greater
significance due to increasing size of
organizations, rapid advancement technology
and complexity of human behavior.
PERSONNEL MANAGEMENT
 In defining personnel management, George
R. Terry said “Personnel management is
concerned with the obtaining and
maintaining of a satisfactory and satisfied
work force.”

 Personnel management is that part of the

process of management which is specifically
concerned with the people employed in an
organization.
 CONT……
 The purpose of personnel management is to
establish and maintain sound personnel
relations at all levels of organization and to
secure the effective use of personnel by
ensuring such conditions of employment that
enables all persons in the enterprise to
contribute most effectively to its purpose in
the performance of their duties.
 This entails/involves giving adequate
consideration to psychological as well as
physical factors.
 NATURE OF PERSONNEL MANAGEMENT
The following are characteristics of
personnel management:
1. People- Centered
 People working in an organization are the center
of success of the personnel management. They
have a lot in common. But each person is unique
from the day of his birth, and his exposure to life
situations.
 So, it is difficult to formulate a common standard
method of dealing with workers as a whole. Each
person has to be treated and motivated
differently.
 CONT…
2. Recognition As Total Human Beings
 Individuals working in an organization contribute
to it their work, talent, drive, and it is not
possible only to employ a person’s skills, talent,
or such other characteristics a whole person is
to be employed, because his characteristics are
inseparable from him.
 This requires an adequate understanding of his
socio-cultural and economic background.
 Personnel management seeks to develop an
employee as a better person such that he
becomes useful to the society of which he is a
part.
 CONT……
3. Human Dignity
 Human beings represent the finest creation of
nature and expect and deserve to be treated
with respect and dignity. In whatever they do,
they seek recognition of their worth and
aspirations.
 Modern personnel management is concerned
with satisfying not only the physiological needs
of individuals but also their socio-psychological
needs so as to assure them due satisfaction.
 CONT….
4. Multi-disciplinary
 Unpredictability of behavior of people
arises from their deep-seated needs and
value systems.
 Personnel management seeks to achieve
this by adopting a multi-disciplinary
approach, drawing heavily on the theory
and practice of economics, sociology,
psychology, anthropology, political
science, and so on.
 CONT…..
5. Continuous exercise
 To be productive of desired results,
personnel management has to be practiced
on a continuous process.
 It requires a constant alertness and
awareness of human relations and their
importance in everyday operations.

6. Personnel management as profession

 It is a service occupation and therefore
useful to society.
FUNCTIONS OF PERSONNEL MANAGEMENT (STAFFING)

 The main functions of personnel

management can be grouped as under:
1. Staff recruitment
 Each stage in recruiting should be
conducted with the utmost care. It
involves inviting applications,
appointment procedure, conducting
interviews, obtaining character and
past experience, issuing appointment
letters and so on.
CONT……
2. Staff training and development
 This is concerned with increasing the
skills and efficiency of staff.
3. Remuneration policy
 This covers job grading, general wage
policy and methods of calculating wages.
4. Staff relations
 This concerns the co-operation which
needs to exist between staff and the
employer.
 STAFF RELATIONS- CONT..
 Staff relations includes the following ones:
A. Negations with union
 The employer needs to come to an agreement on
the terms and conditions of service with the
employees.
B. Staff welfare
 These are facilities provided by the employer
which are in addition to wages or salaries. It
includes such provisions as medical services,
protective clothing, education and technical
training, sports, etc.
CONT…..
C. Staff safety
 This is concerned with providing better and
safe working conditions around the
environment of employees.
D. Personnel procedures
 These include procedures for complaints,
applying for leave and applying for
termination of services voluntarily
 THE END

ANY QUESTION?
 PIDAM UNIVERSITY

COURSE: PRINCIPLES OF MANAGEMENT

SEMESTER: ONE

CHAPTER FIVE: DIRECTING

LECTURER: SAID MOHAMED

ACADEMIC YEAR: 2022-2023

DATE: 28 MARCH 2023

 INTRODUCTION TO DIRECTING
 Directing implies moving into action.
Directing involves issuing orders and
instructions and taking steps to get
them carried out properly.
 In the words of Massie, “Directing
concerns the total manner in which a
manager influences the actions of
subordinates.
 It is the final action of a manager in
getting others to act, after all
preparations have been completed’.
 CONT…..
 Planning, organizing and staffing are
merely preparations for doing the work
and work actually starts when the
directing is done.
 It is the directing function which initiates
organized action. It ensures that
subordinates do their work as expected.
 Management being getting things done
through others, direction is essential
function of management.
ELEMENTS OR TECHNIQUES OF DIRECTION
 The process of direction consists of the
following elements:
1. Issuing orders and instructions to
subordinates.
2. Continuous guidance and supervision of
employees to ensure that they carry out
their assignment in the proper manner.
3. Motivating subordinates to work
efficiently for the achievement of
organizational objectives.
CONT………

4. Communicating with employees to

understand their needs, aspirations,
problems and suggestions.
5. Maintaining discipline and rewarding
those who perform efficiently.
6. Providing leadership to the
subordinates so that they work with
zeal/succeed and confidence.
ISSUING ORDERS AND INSTRUCTIONS OF THE
SUBORDINATES
 Generally the terms order, instruction,
directive and command are used
interchangeably in management literature.
 An order is a means of initiating, modifying
or stopping an activity.
 It is a primary tool of directing by means of
which activities are started, altered, guided
and terminated.
 An order is always issued by superior and is
enforceable under required authority.
SUPERVISION
 Supervision implies expert overseeing of
people at work in order to ensure
compliance with established plans and
procedures. Every executive is to
supervise the work of his subordinates.
 At the operating level, supervision is the
most significant part of a manager’s job.
 He teaches proper work methods,
maintains discipline and work standards
and solves workers grievances and
problems.
 CONT……
 Supervision is concerned mainly with inspiring
and guiding workers towards greater
performance. Therefore an effective
supervisor must have human relation skills.
He must recognize individual differences and
adopt a people-oriented approach in order to
build up harmonious interpersonal relations in
his department.
 A good supervisor must be technically
competent to guide his workers in the best
way of doing their work. Technical job
knowledge is necessary for him or her.
 CONT……
 An effective supervisor should know fully
the plans and policies of his company. He
should keep himself aware of the changes
in such policies and procedures. He/She
should give full information of such changes
to his subordinates.
 The supervisor’s leadership style should be
appropriate to the nature of task and the
type of workers. He must rationally choose
between close and general supervision.
 Proper leadership is required for the
supervisor
 THE END

ANY QUESTION?
 PIDAM UNIVERSITY
Course: Principles of Management

Semester: One

Chapter Six: Controlling

Academic Year: 2022-2023

Date: 02 APR 2023

 INTRODUCTION OF CONTROLLING
 Controlling is an important element of
the management process. It is not only
provides a record of actual performance
but points out the action required to
achieve the goals.
 It is a process of comparison and
verification that ensures expected
performance.
 Control guides activities towards some
predetermined goals.
 CONT..
 It is the process of ensuring that what
ought to be done is being done and the
restricting of undesirable actions in terms
of quantity, quality, time and costs.
 The managerial function of controlling
involves the measurement of actual
performance, comparing it with the
planned standard and correcting
deviations to ensure attainment of
predetermined objectives.
 DEFINITION OF CONTROLLING
 Fayol defined it as following
“Controlling consists in verifying
whether everything occurs in conformity
with the plans adopted, the instructions
issued and principles established”.
 It has for its object to point out
weakness and errors in order to rectify
or correct them and prevent recurrence.
 It operates on everything – “things,
people, and action”.
 STEPS IN THE PROCESS OF CONTROL

 The basic control process, wherever it is

applied and whatever it seeks to
control, consists of the following steps;
1. Establishment of standards
2. Measurement of actual performance
3. Analysis of variance/Deviation
4. Taking corrective action
 MANAGEMENT BY EXCEPTION
 The activities of a large business
enterprise are so innumerable that it is
neither feasible nor desirable for top
management to control all of them.
 Controls will more economical and
effective if the top management
concentrates attention on exceptionally
serious deviation from the plans and
standards. This is known as the principle
of control by exception.
 CONT…….
 Under this principle only matters which are extra
ordinary or exception are reported to top
management for necessary action.
 The routine and less important matters are left to
be dealt with the lower levels of management.
 Management by exception is the practice of
examining the financial and operational results of
a business, and only bringing issues to the
attention of management if results represent
substantial differences from the budgeted or
expected amount. Example, the company
controller may be required to notify management
of those expenses that are the greater of $10,000.
REQUIREMENTS OF EFFECTIVE CONTROL
SYSTEM

Effective and adequate control
system must satisfy the following
requirements:
1. Suitability- Appropriate to the Situation
2. Promptness- Rapid and quick control
needed
3. Forward looking- Concentrate the effect
for the future operations
4. Control by exception- Special matters
control or extra-ordinary Controls
 CONT…….
5. Objectivity- True and Fair Control
system
6. Flexibility-Can be changed easily
7. Organizational pattern- Applicable to
the Organizational Structure
8. Economy- Increasing Benefits and
Reducing the Cost
9. Simplicity- Simple to follow and Practice
10. Suggestive- Highlights the corrective
actions to be taken.
ESSENTIAL REQUIREMENTS OF GOOD CONTROL

 An ideal/perfect control system should

detect and report deviations as soon as
possible if not before they occur.
 Timely corrective action is possible only
through prompt reporting of deviations
and their causes.
 Preventive control minimizes wastage
losses and uncertainty for future actions
of employees and outcomes resulted
doing of such actions.
 TECHNIQUES OF MANAGERIAL CONTROL
 Some traditional techniques includes:
1. Budgetary control
 Budgets are widely used techniques of
managerial control.
2. Cost control
 This is a control of all the costs of an
undertaking, both direct and indirect, in
order to achieve cost effectiveness in
business operations.
 CONT…..
3. Inventory control
 Inventory control, or materials management
or stock control refers to controlling the kind,
amount, location, movement, and timing of
the various commodities used in and produced
by the industrial enterprise.

4. Production control
 Production control is the process of planning
production in advance of operations,
establishing the exact route of each individual
item, part or assembly, setting, starting and
finishing dates for each important item.
CONT………..
5. Auditing
 External audit control is enforced by
law in respect of all joint stock
companies and cooperative.
 Internal and External audit are form
of control which verify the
performance;(Financial and Non
Financial) of the organization.
 1

The end

ANY QUESTION?
 PIDAM UNIVERSITY
Course: Principles of Management

Semester: One

Chapter Eight: Decision Making

Academic Year: 2022-2023

Date: 09 APR 2023

 INTRODUCTION TO DECISION MAKING
 Decision making process is a sequence of
steps leading to a selection of a course
of action from two or more alternatives.
 Decision making is a cognitive process
resulting choosing the best of the
different options available to the
decision maker.
 When taking decisions people considers
opportunity cost for preferring one thing
to the another.
 TYPES OF DECISIONS
Managerial decisions may be classified on
different bases into the following
categories:
1. Organizational decisions and personal
decisions
2. Routine and strategic decisions
3. Policy and operating decisions
4. Programmed and non-programmed
decisions
5. Individual and group decisions
 STAGES INVOLVED IN DECISION-MAKING
 All decisions regardless of their nature
or significance involve certain common
elements.

 Decision making is a systematic and

planned process consisting of several
interrelated phases.
 The various stages in the process of
rational decision making are described
below:
 CONT…
1. Defining the problem
The first step is to identify, determine
and define the problem clearly. A problem
is half-solved when it is well defined.
Perception of the problem involves the
definition of the desired results,
identification of the fundamental cause
and magnitude of the problem and the
limits or boundaries within which it can
be solved.
 CONT….
2. Analyzing the problem
 Once the problem is defined, it must be
analyzed in terms of nature, impact,
futurity, periodicity, etc.
 Such analysis is required to determine
who should take the decision, what
information is required and how it can
be gathered.
 A decision is as good as the information
on which it is based.
 CONT…….
3.Developing alternative solutions
 There is seldom/rarely problem on
which alternatives do not exist.
 It is essential to search for and identify
possible alternative. Due to time and
cost constraints it is not possible to
know all possible alternatives. While
listing alternative courses of action,
the negative aspect should not be
ignored.
CONT….
4. Evaluating alternatives
 After the alternatives are developed,
the next step is to compare and
evaluate them in terms of their costs,
time feasibility and contribution to
objectives.
 Alternatives should be assessed in
terms of the critical or limiting factors
both tangible and intangible.
 CONT…..
5. Selecting the best alternative
 A comparative evaluation of different
alternatives will reveal or Disclose the
relative worth of each alternative. That
alternative which can make net maximum
contribution to the goal is selected.
 Selection is the point of ultimate decision
making. Selection of the most promising
or desirable course of action involves
choice-making.
 CONT……….
6. Implementing the decision
 Implementation of the decision involves
development of detailed plans,
communication of the decision, gaining
acceptance of the decision, getting
support and cooperation of those
concerned for converting the decision
into effective and developing controls to
ensure that the decision is being carried
out properly.
CONT……

7. Evaluation of decision process

 The final step in decision making is the
appraisal of both the decision and the
process of decision making.
 If the evaluation or follow-up shows
unsatisfactory results, the process
should be reviewed and the decision
may be modified.
I

THE END