MANAGEMENT FUNCTIONS

AND

ORGANISATIONAL PROCESS
Introduction to management Functions & process
 Introduction to Management functions
• All of us engage in managing.
• Ever since human life started either for food or shelter, the basics of management were
present these activities.
• The Egyptian pyramids built centuries ago, are evidence of organizational skills of workers in
those times, which meant that a number of management functions were in use. Similarly,
Indus valley civilization also demonstrates the use of management techniques of a high level at
the time it was built. These instances also show that management has been an inherent part in
human survival & organized activity.
• As societies grew, individuals could not achieve their goals individually and hence their efforts
as a group had to be coordinated through the management function. The groups increased in
number, thus making the role of the managers critical for success.
• Individual now has a variety of opportunities on the one hand and the challenging work
environment, on the other. Thus, competition for the individuals is for the jobs, resources, and
rewards, making it necessary for learning management.
• Similarly, the business scene has changed forcing organizations to compete for contracts,
clients and customers, to effectively manage and deliver for retaining the clients/customers.
 Why Study Management?
The universality of management
• The reality that management is needed in all types, sizes,
level, areas of organizations.
The reality of work
• You will either manage or be managed in your future career
• Organizations that are well managed find ways to prosper
even in challenging economic times
 Why Study Management?
Rewards and challenges of being a manager
Rewards Challenges

Create work environment where organization Do hard work

members can work to the best of their ability
Have opportunity to think creatively & use May have duties that are more clerical than
imagination managerial
Help others find meaning & fulfillment in Have to deal with a variety of personalities
work
Support, coach, and nurture others Often have to deal with limited resources
Work with variety of people Motivate workers in chaotic and uncertain
situations
Receive recognition & status in organization Blend knowledge, skills, ambitions, and
and community experiences of a diverse workgroup
Play a role in influencing organization Success depends on others’ work performance
 What Is Management
• WHAT IS A BUSINESS? :A business is any organisation that uses resources to meet the needs of
customers by providing a product or service that they demand.
• WHAT DO BUSINESSES DO? : Businesses identify the needs of consumers or other firms. They
then purchase resources, which are the inputs of the business or factors of production, in order
to produce output. The 'outputs' of a business are the goods and services that satisfy consumers'
needs, usually with the aim of making a profit.
• MANAGEMENT
• The process of getting things done effectively and efficiently, with and through people. A process
refers to a set of ongoing and interrelated activities.
• Efficiency : “Doing things right”, and getting the most output from the least amount of
input( minimizing the cost).
• Effectiveness : doing those work tasks that help the org to reach its goals.
• Efficiency is concerned with the means of getting things done while effectiveness is concerned
with the ends.
• Definition: Business management involves the supervision, organisation and coordination of
business resources and operations to achieve specific objectives.
• Definition: Business management is defined as the managerial process of coordinating,
organizing, channelizing, and implementing business strategies and activities.
 What Is Management – Meaning and scope
• We all are managers in some measure in our daily lives. People face different situations forcing
them to manage them in a planned & organized way so as to achieve goals.
• Management is an activity with a goal accomplishment and results orientation.
• Organization consists of groups of people working together towards a goal. Management is
characterized by the interaction with others in the accomplishment of the task.
• Mary Parker Follett has defined “management as the art of getting things done through the
efforts of others”.
• According to Herald Koontz and O’Donnell, “Management is the process of getting things done
though the organized group efforts”. They also said “Management means Manage Men
tactfully” to label it Manage/Men/T.
• F W Taylor defined management “as the art of knowing what you want to do in the best and
cheapest way”
• Dynamic nature of management makes it difficult to have a universal definition encompassing
all its dimensions in its entirety.
• Essence of management revolves around managing people and other resources in an
organization both internal & external, leading to achievement of objectives of the organization.
• Management is the process of setting and achieving goals through the execution of five basic
management functions (i.e. Planning, Organising, Staffing, Directing and Controlling) that utilise
 What Is Management – Nature
• Nature of management? One group argues that it is science, while other group views as an art.
• Science is a systematic body of knowledge with basic principles that have universal application.
Science depends on reliability & validity based on experiments & generalization. Accordingly,
management over the years has developed certain principles, laws, theories & generalizations
which could be applied universally in a variety of organizations. Management has a body of
knowledge with underlying principles & hence can be called a science. Scientific management
proposed by FW Taylor is proof for the status of a science based on experiments on the human
beings on the shop floor using management techniques. However, management does not
enjoy status of an exact science in the nature of pure sciences like physics, chemistry etc.,
• Management deals with humans & it is difficult to verify & predict complex human behaviour.
Its dynamic nature complicates it in terms of verifiability, reliability, predictability &
generalization. However, the scientific procedure, systematic analysis & methodological rigour
used in management research along with advanced tools & techniques provides the field the
status to the discipline. Research in areas like mathematics, statistics, Psychology have added
the scientific fervour to the discipline. Some contend that management is a combination of
both art and science. They argue that managerial activity is a creative art although, it is
becoming more scientific in nature. In addition, the theories and practice acknowledge unique
characteristics which make it a distinct field.
 Management discipline Science or Art?
• Elements of art in management
• Practical Knowledge,
• Personal Skill,
• Creativity,
• Perfection through practice,
• Goal-Oriented.
• Elements of Science in Managing
• Concepts
• Methods and principles
• Theories
• Organized knowledge
• Practice
 What Is Management – Nature
• Management could also be understood in terms of its status as a profession. A profession is a
certified vocation of individuals that enables applying the basics principles and practices under
a certain given code of conduct. Effort has been made to view management as profession. The
criteria for a profession is

• A codified body of knowledge

• A long period of formal education and training
• Specified criteria for entry
• A code of conduct/code of ethics
• Professional tools/ techniques
• Specialized fields of study
• A professional body/association
• Management over its evolution has created a body of knowledge with underlying principles
that could be applied uniformly across a variety of organizations. Most managers also go
through a systematically prepared formal education in B School/University and complete the
prescribed training in the course of the managerial functions. Moreover, companies insist on
ethical behaviour demonstrated by a strict code of conduct.
 Characteristics of Management
• MANAGEMENT IS
• A group activity: Organization reflects the social dimension, where individuals interact with
each other to get things done, individual efforts alone doesn’t guarantee results. Management
can’t be done in isolation & includes group activity.
• is Universal in its application: applies to government, business enterprises, education
institutions, military, medical & NGOs in equal measure.
• is a continuous activity: It is dynamic in nature and is continuous. The ever changing
organizational activity provides continuity to management functions.
• an Integrated Effort: Management integrates human & other resources in achievement of
objectives of organizations. Individual and organizational goals get aligned for effective
functioning of organization.
• a well-defined process: Management is considered unique because of well-defined & clear cut
process of getting things done through various functions of management.
• objective-driven & result-oriented: Organizations have clear objectives and goals, the
accomplishment of which is systematically driven by the management function.
• a set of roles and skills: Means skills of individual or groups involved in managerial function.
• a function: The management process is characterized by the functions that the manager
performs. They are planning, organizing, staffing, directing, coordinating, & controlling.
 Characteristics of Management
• Multidimensional: Business management is a multidimensional process. The three
main dimensions of management are people, work and operations.

• Management of People: People or human labour is the main asset of every

organization, and their management is crucial for its managers.

• Management of Work: Every organization has to perform some work to accomplish its
pre-determined organizational goals.

• Management of Operations: Every organization is involved in either manufacturing or

selling of services or goods. Management of operations deals with activities involved in
this process.

• Dynamic Function: There are different internal and external factors that affect the
working of an organization. An organization has to change and adapt itself on the basis
of changing environment to accomplish the organizational goals and objectives.
 Characteristics of Management
SO

Management is an activity or process

Management is a human activity
It makes things happen
It is purposeful
It uses available resources economically to maximise outputs
The organisation’s objectives are accomplished by, with and through the efforts
of others (group activity)
Managing implies using certain skills, knowledge and practices to bring
effectiveness
It is aided and not replaced by the computer
It is intangible
 Understanding Management & Administration
• Management is concerned with getting things done, whereas Administration looks at how these
things are done.
• Management consists of actions and plans. Administration entails setting objectives & policies.
• Management aims at managing not only people but also their work. Whereas Administration
focuses on how best the resources of an organization can be utilized.
• Administration typically has a role in all management decisions, whereas not all administrative
decisions require the input of management.
• Administration is focused on setting & creating policies and procedures. Management however is
more likely to deal with the broader functions of an organisation and how tasks are executed.
• Administrative functions are more defined. How manager act & operate differ person to person
• The management style of an organisation can also change with the new Manager/Leader.
Administrative policies or procedures are slower to change & may remain in place for many
generations of management.
• The administrative functions of a business can be guided or influenced by legislation or law.
Whereas how a manager chooses to guide or lead their team is often a function of their
experience and the company culture.
 Understanding Management & Administration
Basis for comparison Management Administration
Meaning An organized way of managing people The process of administering an organization by a
and things of a business organization group of people is known as the Administration.
is called the Management.
Authority Middle and Lower Level Top level
Role Executive Decisive
Concerned with Policy Implementation Policy Formulation
Area of operation It works under Administration. Has full control over the activities of Organization.
Applicable to Profit making organizations, i.e. Government offices, military, clubs, business
business organizations. enterprises, hospitals, religious and educational
organizations.
Work Putting plans and policies into actions. Formulation of plans, framing policies and setting
objectives
Key person Manager Administrator
Function Executive and Governing Legislative and Determinative
Understanding Management & Administration

Difference Between Management and Administration

 Understanding Management & Administration
• Key Differences Between Management and Administration

• Management is systematic way to manage people & things within organization. Administration is an act
of administering the whole organization by a group of people.
• Management is an activity of business & functional level, whereas Administration is a high-level activity.
• Management focus on policy implementation, policy formulation is done by administration.
• Function of administration are legislation & determination. Function of management are executive &
governing.
• Administration takes important decisions of the organization. Management makes decision under
administration.
• A group of persons, who are employees are known as Management. Administration represents owners.
• Management can be seen in the profit making organization like business enterprises. Conversely, the
Administration is found in government and military offices, clubs, hospitals, religious organizations and
all the non-profit making enterprises.
• Management is about plans & actions, Administration concerns with making policy & setting objectives.
• Management plays an executive role in the organization. Administration role is decisive in nature.
• Management focuses on managing people and their work. On the other hand, administration focuses
on making the best possible utilization of the organization’s resources.
 Understanding Management & Administration
• Mostly, Management and Administration are used interchangeably, although, they differ
significantly in meaning and focus.
• Administration and management are represented by two groups- one led by British School of
thought and other led by American researchers.
• British argue that management is wider compared to administration and usually related to the
top management. They contend that administration relates to carrying out the activities at the
operational level. The British argue that management is superior to administration. The focus
of administration is on the immediate problems, while the management focus is on the long
term objectives. They maintain that management involves itself in the rule making/rule
enforcing while administration engages itself with the situation on hand.
• American School, advocate that administration is the thinking function and management is the
implementing function. The role of administration according to them is policy formulation
while the managers implement the policy and get involved in the day- to- day operations.
• However, the contemporary thinking equates management and administration. Accordingly,
management process is essentially the same in all the organizations and hence, the
management and administration have to essentially go through the same process and hence
they remain the same.
 Importance of Management
• Management is important because of the following reasons:

Effective management leads to optimum utilization of resources. Factors like men, materials,
money and machines can be effectively utilized only through management.
Organizations function through teams and groups. Managers provide the leadership and direct
the members of the team towards the achievement of group and organizational goals. Thus,
management facilitates the achievement of the individual, team and organizational goals.
Management helps in the smooth functioning of organization through a proper allocation of
tasks to members & monitoring the implementation effectively. This helps organization to have
cordial inter-personal employee relations and sound industrial relations in the organizations.
Organizations are influenced by a numbers of internal and external challenges in the external &
internal environment. The planned activities might get displaced in the event of uncertainty
and suddenness of change.
Management contributes to an improvement in the standard of the organization. Successful
managers innovate practices which leads to an improvement of individuals and organizational
standards, thus facilitating the best practices in the organization.
 Functions of Management
• All managers, irrespective of the level- top, middle and lower –perform management functions.
However, the time spent by the managers on these activities differ based on the level at which there
are placed. Top managers spent more time on planning and organizing whereas, middle level
managers spend more time on leading the group directing and controlling. Lower level spend more
time on organizing themselves to execute the task. The primary functions of management are
generally grouped under five heads- Planning, organizing, staffing, directing & controlling.
P O S D C
• Planning: Planning is preparation for future action. It relates to an activity which bridges the gap
between the present & future. The planning functions starts after the broad organizational
objectives are spelt out to decide the future course of action. An all pervasive function & hence
applies to all levels of management. Includes setting objectives, strategies, policy formulation & the
consequent laying down of the procedures & programs for the achievement of objectives. It is future
oriented and determines the direction in which the organization is moving.
• Organizing: Organizing is related to the structure of an organization with clearly defined lines of
authority and responsibility, through which the work is allotted, monitored and coordinated so that
each division and department relate to each other to work together for the achievement of
organizational objectives. It involves activities like delegation, fixing authority and responsibility for a
smooth conduct of work.
 Functions of Management
• Staffing: Staffing relates to finding the right people for the right job in the given structure of the
organization. It starts with design of the job, identifying the job, job analysis, thus, paving the way
for recruiting, selecting, placing the people initially & promoting them later on. Also includes
functions of developing the people through training for efficient & effective functioning of their
assigned work.
• Directing: This functions involves providing good leadership, communication channels, motivation
& supervision so that employees are able to function efficiently to attain desired goals. It consists
of the process & techniques which issues required instruction & monitoring operation for smooth
functioning. Managers communicate & transmit the message for smooth flow of work. There are
many evidence of miscommunication or improper communication leading to organizational failure
across the world. It’s thus, a critical element in the function of direction. Similarly, teams and
groups of people require proper guidance from the leaders for effective functioning. Leadership
relates to the process of influencing the behaviour of people on the job.
• Controlling: The function of control consists of those activities that are undertaken to influence
that there is no deviation in the plan. The control process includes setting of the standards,
performance target and measures along with corrective action that is taken at different stages of
the control process. This function is always misunderstood and throws up a negative connotation of
restricting people in their job. This function aims at checking whether organizational objectives are
met and action that could be taken in future as the work is in progress
 Challenges of Management
• Globalization: Many economies have embraced Liberalization globalization, privatization ( LPG),
which means that economies follow the guidelines in terms of trade laid down by the global
agencies like the WTO, ILO and also similar agencies like EU, SAARC etc. It shows interdependence
of economies, cultures and people because of the cross border trade of goods & services,
technology, flows of investment, information & communication. This interconnect across people &
businesses leads to cultural, political & economic integration across the economies in the world. As
business could be conducted internationally, management has to take care of the communication
challenges, people related challenges & business related challenges. Internet has transformed the
world of work & the way businesses are carried out. IT companies in India, manage businesses at
several locations in the world using the Internet. Thus, the internet has become a force for
connecting people regardless of time & location, making it easy for the manager to monitor &
manage, but the challenges remain in terms of connectivity, security, speed & other factors.
• Technology: Impact of globalization is very significant on technology & technological changes.
Technology has revolutionized every sector, it complicates things & creates new opportunities. The
speed with which technological changes take place affect the communication patterns, information
content & knowledge that gets generated, stored & can be used for organizational use. The world is
a witness to significant changes that has taken place in the technology front.
• Change Management: Three facts about change- that it is everywhere, it is constantly present &
pace of change is experienced by everyone. People dislike change & resist change. In reality change
is inevitable and the speed with which the pace of change is taking place is increasing day by day.
 Challenges of Management
• Workforce diversity: “Diversity” means variety. Diversity exists in companies when there is variety
of demographic, cultural & personal differences among people who work there. Diversity makes
good business sense by helping companies attract & retain talented workforce. Diverse friendly
companies attract better & more diverse job applicants. Diversity is no longer about counting
heads, it is about making heads count, said the Vice President at Pepsico. While diversity has
advantages – experience, insight & creativity of a diverse workforce, managers have challenges in
dealing with diverse workforce.
• Innovation: Innovation is introduction of new goods & services. Companies are forced to innovate
to bring changes in their goods & services and stay in competition. Innovation becomes the key to
sell the goods or to satisfy the customer’s preferences. Innovation is all pervasive & has become an
important ingredient in business success when Ecommerce has been introduced in a big way.
• Ethics and Governance: Globalization has introduced the concept of businesses with no borders,
thus allowing businesses to operate anywhere across the world. Managing businesses requires
strict adherence to business ethics on a professional level. Governance presupposes understanding
of the rules and regulations, policies and procedures in the different corners of the world.
• Quality: Quality reflects the excellence of the product or service. The acceptable standards of
quality have dramatically increased over the years. Providing world class quality requires
adherence to what quality entails. It can be measured in terms of product performance, reliability,
customer service, durability, appearance, quality standards etc.