INTRODUCTION TO MANAGEMENT
"Management is the process of designing and maintaining an
environment in which individuals, working together in groups, accomplish
efficiently selected aims.“
Koontz and Weihrich
To manage is to forecast and plan, to organise, to command, to
coordinate and control.
Management is effective utilisation of human and material resources to
achieve the enterprise objectives.
NATURE AND FEATURES OF MANAGEMENT
• Management is a social process
• Management also denotes a “body of people” involved in decision making
• Management is omnipresent and universal
• It is an inexact science
• It is complex
• Management is situational in nature
• Management is an art and also a science
• Management is a profession
• Management is inter-disciplinary
• Manager has four types of resources-the Four M's
IMPORTANCE OF MANAGEMENT
• It facilitates the achievement of goals through limited resources
• It ensures smooth sailing in case of difficulties
• It ensures continuity in the organization
• It ensures economy and efficiency
• It focuses on group efforts
• It is the key to the economic growth
CONCEPT OF ORGANISATION
• "Organization is the framework of the management process.“
• "Organizations are systems of interdependent human beings.“
Significance of Organisation:
• It facilitates administration
• It facilitates growth and diversification
• It ensures effective utilization of manpower
• It stimulates creativity
• It ensures optimum utilization of resources
FUNCTIONS OF MANAGEMENT
It refers to deciding now what is to be done in the future. It bridges the gap between the
present and the future.
Organizing refers to the process of grouping the related activities and assigning them to a manager with
authority to supervise it.
Staffing is a process which includes recruitment, selection, training, placement, appraisal,
promotion, and career planning
Directing is a process of issuing orders and instructions to guide and teach the subordinates the
proper methods of work and ensuring that they perform their jobs as planned
It is the process of measuring the current performance of the employee and assess whether the
given objectives are achieved or not.
SYSTEMS APPROACH TO MANAGEMENT
• One of the modern approaches to understand management is the systems approach.
Here, the organization is viewed as a system. Every department of the organization
is considered as a sub-system.
• It is also possible that every department can be viewed as a system and every
section in the department can be viewed as a sub-system. Thus, systems approach
helps to study the basic features and functions of the organization to its minutest
From the systems point of view, the functions of management are:
(c) Complex and intertwined that each function of management can be found in other
HENRI FAYOL'S CONTRIBUTION TO
• Division of work
• Unity of command
• Unity of direction
• Subordination of individual interest to group
• Centralization of authority
• Scalar chain
• Stability of tenure of personnel
• Espirit de corps
CONTRIBUTION OF FREDERICK WINSLOW TAYLOR
Scientific management was the process of applying scientific principles
to management-related issues. The process contained the following elements:
• Develop a scientific method for each operation replacing opinions or rule of
• Determine accurately in a scientific way the correct time and method for each
• Develop a suitable organization to make the workers responsible
• Select and train the workers
• Convince the management that scientific approach is better than arbitrary
CRITICISM OF SCIENTIFIC MANAGEMENT
• ignores the functional areas of management such as marketing, finance, and
• Individual creativity is ignored by favouring one best way.
• Worker is reduced to a cog in the machine.
• Over specialisation made the work more fragmented.
• Mobility among workers gets restricted because of narrow specialization.
• Workers were not involved in the planning part of the job which was
controlled by the management.
BENEFITS FROM SCIENTIFIC MANAGEMENT
• Scientific management improved working methods and brought enormous
increase in productivity
• It initiated certain improvements in working methods, plant design and-
• Piece rate wage system was introduced and incentive systems were evolved.
• Physical working conditions for the employees underwent a sea change
• It laid the foundation for work study and other related techniques
ABRAHAM MASLOW’S NEED THEORY
• Physiological needs
• Safety needs
• Affiliation or acceptance needs
• Esteem needs
• Self-actualisation needs
HERZBERG TWO FACTORS THEORY OF MOTIVATION
• HYGIENE FACTORS:-
Hygiene factors are the basic requirements such as company policies
and procedures, salary, security, supervision, working conditions, personal and
social life, and so on.
• MOTIVATIONAL FACTORS:-
Motivators refers to the higher order needs such as-recognition on the
job front, awards and rewards, challenging assignments, promotion, and so
DOUGLAS MCGREGOR’S THEORY ‘X’ AND THEORY ‘Y’
Under theory ‘X’, it is assumed that
• Employees are inherently lazy
• They require constant guidance and support
• Some times they require even coercion and control
• Given an opportunity, they would like to avoid responsibility
• They do not show up any ambition but always seek security
Theory ‘Y’ states that
• some employees consider work as natural as play or rest .
• These employees are capable of directing and controlling performance on their own. They are much
committed to the objectives of the organization .
• Higher rewards make these employees more committed to organization
• Given an opportunity, they not only accept responsibility but also look for opportunities to outperform
• Most of them are highly imaginative, creative, and display ingenuity in handling organizational
1. Autocratic leadership
Here, leaders command the followers and expects compliance from them
for all the instructions given.
2. Democratic or Participative leadership
Here leaders consult subordinates and involve them in decision making.
They encourage discussion with the group
3. Free-Rein Leadership
Free-rein leadership also called laissez-faire leader. Free-rein leaders
exercises little authority and give maximum freedom to subordinates while
BASIC CONCEPTS RELATED TO ORGANISATION
• Organisational Hierarchy
The hierarchy in a business refers to the layers of management from the top
management down to managers or supervisors of the lowest rank.
• Authority and Responsibility
Authority is the power to give commands
Responsibility is the obligation on the part of the subordinate to complete the
• Delegation of Authority
The process of transferring authority from the top to the lower levels in the
organization is called delegation
• Span of Management
It is also called span of control. It refers to the number of subordinates that can be
effectively controlled by the manager at a given point of time
PRINCIPLES OF ORGANISATION
• Align departmental objectives to
• Cost-effective operations
• Optimum number of subordinates
• Define authority
• Flow of authority.
• Manage via exceptional cases
• Ensure one employee, one superior
• One head and one plan
• Define responsibility
• Commensurate authority and
• Attain balance
• Ensure flexibility
• Provide for continuity
TYPES OF ORGANIZATIONS
Line organization is also called military or scalar organization.
This is called line organization because managers in this organization have direct
responsibility for the results.
(a) It sets clearly the direct lines of
authority and responsibility of a line
(b) It is simple to understand
(c) Each section or department can be
treated as a unit for control purposes
(d) It facilitates quick decisions and prompt
(a) It is likely that the line manager is
overburdened with all tasks relating to a
particular section or department
(b) There is no scope for specialization
(c) There is more scope for favouritism and
(d) It may lead to low morale in the
LINE AND STAFF ORGANIZATION
• This concept is drawn from earlier civilizations and armies. In this
organization, we have both the line managers and the staff managers.
• Staff managers support the functions of the line managers. The staff
managers are specially appointed to give advice, suggest, or assist the line
managers in their day to day matters.
• The line managers can take the support of their staff managers to get a full
view of the issue under consideration.
EVALUATION OF LINE AND STAFF ORGANIZATION
(a) It enhances the quality of decisions
(b) There is a greater scope for advancement .
(c) It relieves the line managers
(d) It is mostly beneficial where there is a line of command within staff departments
(a) It may create more friction or conflict between line and staff managers
(b) Staff suggestions are seldom implemented
(c) It is expensive
• FW Taylor suggested functional organization in his theory of scientific
management in support of his 'one best way' of doing things.
• Taylor observed that one single foreman was overburdened with all the
operations such as task setting, time recording, quality inspection,
disciplinary jobs and so on.
• He divided this job into eight functional foremen four dealing with the
planning task and four dealing with the implementation task.
• In other words, the planning and implementation tasks are divided to
ensure the division of labour.
The foremen involved in the planning task were:
• Route-clerk (identifies the route for the materials to pass on)
• Instruction clerk (gives instructions to the workers about what to do and what
• Time and cost clerk (identifies the time and cost for each job)
• Shop disciplinarian (maintains the discipline on the shop floor)
Those involved in implementation were:
• Gang Boss (assembles the machinery needed for the worker)
• Speed boss (standardises and sets the speed of the machines)
• Repair boss (repairs the machinery in case of breakdown)
• Quality inspector (responsible for the matters relating to quality)
EVALUATION OF FUNCTIONAL ORGANIZATION
(a) Planned specialization
(b) Separates activities related to planning
(c) Facilitates large scale production through
(d) The disciplinary controls are well defined
(e) Appropriate when there is a single
product or service
(f) Offers clear career paths for functional
(a) Ineffective controls as workers have
more than one boss
(b) Very costly
(c) Calls for more coordination
(d) Less appropriate when an
(e) No clear line of authority
• A committee is formed when two or more persons are appointed to work as a
team to arrive at a decision on the matters referred to it.
• It is intended to utilize the knowledge, skills, and experiences of all the
concerned parties. Particularly, in large organizations, problems are too big
to be handled by one single expert.’
• Whenever any problem arises, the management may choose to appoint a
committee with the main parties associated with it as members.
• A time frame is fixed for submitting its recommendations to resolve the
crisis. Within this time limit, the committee' members consult, coordinate,
and deliberate to stimulate necessary ideas in resolving the conflicts or
EVALUATION OF COMMITTEE ORGANIZATION
(a) It pools up the organizational resources in
terms of knowledge, skills and experience
(b) It represents all interested groups and
thus, facilitates group decision
(c) It yields good results if the committees are
headed by taskmaster like chairman and
timebound in terms of decision-making
(d) It minimizes the fear of too much authority
vested in one person .
(e) It motivates all the concerned or affected
groups to participate
(a) Responsibility for decisions cannot be
fixed on a particular person
(b) It calls for high degree of-coordination
(c) It involves high cost in terms of time
• This is also called project organization.
• It is a combination of all relationships in the organisation-vertical,
horizontal and diagonal.
• It is mostly used in complex projects. It provides a high degree of operational
freedom, flexibility and adaptability for both the line and the staff managers
in performing their respective roles.
• The main objective of matrix organisation is to secure a higher degree of
EVALUATION OF MATRIX ORGANIZATION
(a) It offers operational freedom and
(b) It seeks to optimize the utilisation
(c) It focuses on end results
(d) It maintains professional identity .
(e) It holds an employee responsible
for management of resources .
(a) It calls for greater degree of
(b) It violates unity of command
(c) It may be difficult to define
authority and responsibility precisely
(d) Employees may find it frustrating
to work with two bosses
MODERN TRENDS IN ORGANISATIONAL STRUCTURE
1. Virtual Organisation
• Virtual organisations facilitate competitiveness particularly when these organisations
are part of the global economy. Here, there can be alliances and partnerships with
other organisations almost all over world
• It is a flexible Organisation structure that removes the traditional boundaries. It
allows easy reassignment and reallocation of resources to take quick advantage of
shifting opportunities in global markets.
• As·virtual organising requires a strong information technology (IT) platform
• Virtual Organisations come into being' as needed' when alliances are called into action
to meet specific operating needs and objectives. When the task is complete, the alliance
rests until next called into action. Each partner in the alliance contributes to the
virtual Organisation what it is best at-its core competencies
• Organisation structured around the units/cells that complete the entire
assembly processes are called cellular' organisations.
• In cellular organisations, workers manufacture total product or
subassemblies in teams (cells).
• Every team (cell) of workers has the responsibility to improve or maintain
the quality and quantity of its products.
• Each team is free to reorganise itself to improve performance and product
• A structure in 'which the entire organisation is made up of work groups or
teams is known as team structure.
• Team structures are both permanent and also temporary in nature as
situation demands. It leads to boundaryless Organisation in a borderless
• In team structures, we find cross functional. teams meant for improving
lateral relations, solving problems, completing special projects and
accomplishing routine tasks.
• A cross functional team comprises members from different functional
departments such as marketing, finance, HR, production etc. Here-
employees are more involved and empowered because of reduced barriers
among functional areas.
• A boundaryless Organisation eliminates internal boundaries among
subsystems and external boundaries with external environment.
• It is a combination of team and network structures with the additionof
• The key features of boundaryless Organisation include knowledge sharing,
absence of hierarchy and bureaucracy, empowerment voluntary participation
of expert members, technology utilisation and temporariness.
• Creativity, quality, timeliness, increase in speed and flexibility are the benefits
of the boundary less organisation.
• It also reduces inefficiencies. The’boundaryless Organisations are highly
flexible and responsive.
• This is an alternative to the traditional chain of command.
• This is a structure which is narrow at the top and wide at the base.
• It includes a few levels of management.