Management Functions Overview

Management Functions

• Management functions, according to Luther Gullick, include planning, organizing, staffing, directing, coordinating/controlling, reporting, and budgeting (POSDCORB).
• These functions are performed by managers to improve organizational performance.
• The five key management responsibilities are:

Planning

• The primary management function is planning.
• It involves deciding in advance what to do, when, where, how, and who will do it.
• Planning involves selecting objectives and policies to meet enterprise goals.
• Planning also includes anticipating future events and relating facts to create a proposed course of action.

Organizing

• Organizing involves grouping activities, assigning tasks, defining roles, and establishing relationships.
• This is needed to create effective work methods and maximize productivity.
• Organizing structures job responsibilities, authorities and duties.

Staffing

• Staffing includes recruitment, selection, training, placement, compensation, promotion, and demotion, leading to the retirement of employees.

Directing

• Directing manages and motivates individuals to accomplish work effectively.
• Continuous encouragement is essential for successful direction according to Terry.

Controlling

• Controlling ensures plans are followed and corrective actions are taken as needed
• The process includes setting performance standards, comparing them to actual results, and making necessary adjustments.

Coordinating

• Coordinating synchronizes individual actions to achieve the enterprise's goals.

Budgeting

• Budgeting involves creating estimates of income and expenditures for a specific period.
• Budgets help establish financial controls and supervise expenses within the set limits.

Types of Business Organizations

• Sole Proprietorship: A business owned and operated by one person, often small businesses like caterers and financial planners.
• Partnership: A business owned by two or more people, with varying roles and responsibilities in running the business.
• Corporation: A business structured according to laws of a state, issuing shares and with stockholders as owners. Profit-seeking business.
• Not-for-profit Entity: Entities focused on providing services and not on profit, funded through many different sources.
• Government Agencies: Government units at local, state, and national levels, that provide critical services within their defined territories or departments.

Organizational Structures

• Line Organization (Scalar/Vertical): A hierarchical structure where authority flows from superior to subordinate.
• Functional Organization: A structure based on job functions, like finance or marketing; roles are grouped based on expertise.
• Line and Staff Organization: Line managers are responsible for operations, and staff personnel provide support, expertise, and advice in different areas.
• Matrix Organization: Employees report to multiple managers, often involved in projects or complex tasks.
• Departmentation: Breaking down large organizations into smaller units, often based on geography or function, to better manage specialized activities.
• Centralization: Management of a specific function is controlled in one area or by one person.
• Decentralization: The opposite of centralization, where functions are spread among multiple areas to provide more local authority and response.