PRINCIPLES AND

FUNCTIONS OF
MANAGEMENT
AND
ORGANIZATION
COURSE INSTRUCTOR: UMY RUBAB
 AGENDA
 Definition
 Management function (or)
Process of Management
 Characteristics of
Management
 Efficiency & Effectiveness
 General Principles of
Management
 Management as an
Essential for any
Organization?
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WHAT IS
MANAGEMENT
Management as the art of
knowing what you want to do
in the best and cheapest way.
(BY FREDRIK
TAYLOR)
 DEFINITIONS
 “Management is the process of designing and maintaining an
environment in which individuals working together in groups,
efficiently to accomplish goals.”
 In the words of George R Terry - "Management is a distinct
process consisting of planning, organizing, actuating and
controlling performed to determine and accomplish the
objectives by the use of people and resources“
 According to Peter F Drucker - "Management is a multipurpose
organ that manages a business and manages managers and
manages worker and work".

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 CHARACTERISTICS
1. Management is a Factor of Production:
Manager's primary task is to secure the productive performance
through planning, direction and control. It is expected of the
management to bring into being the desired results. Rational
utilization of available resources to maximize the profit is the
economic function of a manager.
2. Management also implies skill and experience in getting things
done through people:
Management involves doing the job through people. The economic
function of earning profitable return cannot be performed without
enlisting co-operation and securing positive response from "people".
Getting the suitable type of people to execute the operations is the
significant aspect of management.
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 CHARACTERISTICS
3. Management is a process:
Management is a process, function or activity. This process continues till
the objectives set by administration are achieved.
4. Management is a universal activity:
Management is not applicable to business undertakings only. It is
applicable to political, social, religious and educational institutions also.
Management is necessary when group effort is required.
5. Management is a Science as well as an Art:
Management is an art because there are definite principles of management.
It is also a science because by the application of these principles
predetermined objectives can be achieved.
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 CHARACTERISTICS

6. Management involves decision-making:

Management implies making decisions regarding the organization and
operation of business in its different dimensions. The success or failure of an
organization can be judged by the quality of decisions taken by the
managers. Therefore, decisions are the key to the performance of a manager.
7. Management implies good leadership:
A manager must have the ability to lead and get the desired course of action
from the subordinates. According to R. C. Davis-"management is the
function of executive leadership everywhere". Management of the high order
implies the capacity of managers to influence the behavior of their
subordinates.

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 CHARACTERISTICS

8. Management is dynamic and not static: The principles of management

are dynamic and not static. It has to adopt itself according to social changes.
9. Management draws ideas and concepts from various disciplines:
Management is an interdisciplinary study. It draws ideas and concepts from
various disciplines like economics, statistics, mathematics, psychology,
sociology, anthropology etc.
10. Management is Goal Oriented: Management is a purposeful activity. It
is concerned with the achievement of pre-determined objectives of an
organization.
11. Management is Intangible: It cannot be seen with the eyes. It is
evidenced only by the quality of the organization and the results i.e. profits,
increased productivity etc.
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 SCOPE OF MANAGEMENT
Functional Areas of Subject-matter of
Management Management

Management covers the following Management is considered as a

functional areas:- continuing activity made up of
 Financial Management basic management functions like
planning, organizing, staffing,
 Human Resource Management
directing and controlling. These
 Marketing Management components form the subject-
 Production Management matter of management.
 Office Management
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 Functional Areas of Management

Financial Management: Financial management includes forecasting, cost

control, management accounting, budgetary control, statistical control, financial
planning etc.
Human Resource Management: Personnel/Human Resource management
covers the various aspects relating to the employees of the organization such as
recruitment, training, transfers, promotions, retirement, terminations,
remuneration, labor welfare and social security, industrial relations etc.
Marketing Management: Marketing management deals with marketing of
goods, sales promotion, advertisement and publicity, channels of distribution,
market research etc.
Production Management: Production management includes production
planning, quality control and inspection, production techniques etc.

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 Functional Areas of Management

Production Management: Production management

includes production planning, quality control and
inspection, production techniques etc.

Office Management: Office management is concerned

with office layout, office staffing and equipment of the
office.

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MANAGEMENT FUNCTIONS
(OR) PROCESS OF
MANAGEMENT:

A manager is called upon to perform

the following managerial functions:
1. Planning 2. Organizing 3. Staffing
4. Directing
5. Leadership 6. Communication 7.
Motivation 8. Supervision 9. Co-
ordination 10. Controlling

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 PLANNING
 Planning: is a basic managerial function. Planning helps in determining
the course of action to be followed for achieving various organizational
objectives: It is a decision in advance, what to do, when to do how to do
and who will do a particular task. Planning is a process which involves
'thinking before doing’.
 The process of Planning involves a number of steps : (I) gathering
information ; (ii) laying down objectives; (iii) developing planning
premises; (iv) examining alternative courses of action; (v) evaluation of
action patterns ; (vi) reviewing limitations (vii) implementation of
plans.
 Planning is a process of looking ahead. The primary object of planning
is to achieve better results.
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 ORGANIZING
 Every business enterprise needs the services of several persons to look after its
different aspects. The management sets up the objectives or goals to be achieved by
its personnel. The energy of every individual is channelized to achieve the enterprise
objectives. The function of organizing is to arrange, guide, co-ordinate, direct and
control the activities of other factors of production, viz., men, material, money and
machines to accomplish the objectives of the enterprise.
 The process of organization involves the following steps: (i) to identify the work to
be performed; (ii) to classify or group the work ; (iii) to assign these groups of
activities or work to individuals; (iv) to delegate authority and fix responsibility and
(v) to co-ordinate these authority-responsibility relationships of various activities.
 You would organize regular meetings, develop a project plan, and ensure effective
communication channels are in place for team collaboration.

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 LEADING
 In management, leading involves guiding and motivating a team toward a
common goal. Leaders ensure that all team members understand their roles
and how best to execute them. With the right leadership and inspiration,
everyone works together efficiently to achieve the organization’s
objectives.
 Effective leaders possess the following qualities:
o Emotional intelligence
o Good communication skills
o Confidence
o The ability to inspire
o Task delegation skills
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 CONTROLLING
Controlling can be defined as "determining what is being accomplished, that is
evaluating the performance, if necessary, applying corrective measures so that the
performance takes place according to plans.
The process of controlling involves the following steps :
(i) establishing standards of performance ;
(ii) measuring actual performance ;
(iii) comparing the actual performance with the standard.;
(iv) finding variances or deviations, if any ; and
(v) taking corrective action or measures.

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EFFICIENCY & EFFECTIVENESS

Efficiency: The Art of Doing

Things Right

Effectiveness: The Art of

Doing the Right Things

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 GENERAL PRINCIPLES OF MANAGEMENT
Henry Fayol’s 14 principles derive from the circumstance that Fayol’s felt that
management was not well defined. In his striving to change this circumstance he
suggested “some generalized teaching of management” to be a main part of
every curriculum at places of higher education and even beginning in “primary
schools”. Fayol’s dedication to this idea is demonstrated by the fact that after
retirement he went on to not just write books about management ideas, but more
importantly, he found the Centre for Administrative Studies (CAS) in 1917 in
Paris. The CAS mainly functioned as a center of discussion between
professionals from a large variety of professions, in order to further the
knowledge and understanding of management principles.

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 GENERAL PRINCIPLES OF MANAGEMENT
 Division of work: This is the specialization that economists consider necessary for
efficiency in the use of labor. Fayol’s applies the principle to all kinds of work, managerial as
well as technical.
 Authority & responsibility: Here Fayol finds authority and responsibility to be related,
with the later arising from the former. He sees authority as a combination of official factors,
deriving from the manager’ position and personal factors.
 Discipline: Seeing discipline as “respect for agreements which are directed at achieving
obedience, application, energy, and the outward marks of respect. Fayol declares that
discipline requires good superiors at all levels.
 Unity of command: This means that employees should receive orders from one superior
only.
 Unity of direction: According to this principle, each group of actives with the same
objective must have one head and one plan.
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• Subordination of individual to general interest: This is self explanatory when the two
are found to differ, management must reconcile them.
• Remuneration and methods: of payment should be fair and afford the maximum
possible satisfaction to employees and employer.
• Centralization: Without using the term “Centralization of authority.”Fayol's refers to
the extent to which authority is concentrated or dispersed. Individual circumstances will
determine the degree that will give the best overall yield.
• Scalar chain: Fayol thinks of this as a chain of superiors from the highest to the lowest
ranks, which, while not to be departed from need lessly, should be short circuited when
to follow it scrupulously would be detrimental.
• Order: Breaking this into material and social order, Fayol's follows the simple adage of
a place for everything and everything in its place.
• Equity: Loyalty and devotion should be elicited from personnel by a combination of
kindliness and justice on the part of managers when dealing with subordinators.
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• Stability of tenure: Finding unnecessary turnover to be both the
cause and the effect Of bad management, Fayol points out its
dangers and costs.
Initiative: Initiative is conceived of as the thinking out and
execution of a plan. Since it is one of the keenest satisfactions for
an intelligent man to experience.
Esprit de corps: This is principle that “in union there is strength”
as well as an extension of the principle of unity of command,
emphasizing the need for teamwork and the importance of
communication in obtaining it.

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Management as an Essential for any
Organization?

 Managers are charged with the responsibility of taking actions

that will enable individuals to make their best contributions to
group objectives. Management thus applies to small and large
organizations, to profit and not-for profit enterprises, to
manufacturing as well as service industries.

 The basic purpose of organizations in society is to bring

people together to achieve common goals, whether those
goals are related to business, social, or other endeavors.
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