Management Principles and Functions

Management Process Objectives

• The objectives are to state various management principles and describe different management functions.

What is Management?

• Management is the act of getting things done through people, using available resources to achieve desired goals.
• Management is a systematic study of knowledge based on observations.

Fayol's Principles of Management

• Division of work
• Authority and responsibility
• Discipline
• Unity of command
• Unity of direction
• Subordination of individual interest to the common good
• Remuneration of personnel
• Centralization
• Scalar chain
• Order
• Equity
• Stability
• Initiative
• Esprit de corps

Process of Management

• Henri Fayol, a prominent management figure, outlined the management process in five interconnected functions: planning, organizing, controlling, directing, and staffing.

Functions of Management (Definitions)

• Planning: Choosing goals and deciding how to achieve them. This includes the who, when, and where of actions. It's about bridging the gap between the current state and desired future.
• Organizing: Systematically arranging resources to achieve the planned objectives. This encompasses coordinating human, physical, and financial resources to work effectively together.
• Controlling: Evaluating progress toward goals, and taking corrective actions as necessary. This involves measuring performance and making adjustments.
• Directing: Guiding employees and providing the necessary instructions to achieve the organizational goals. This relies on leadership and effective communication.
• Staffing: Recruiting, selecting, training, and developing employees to fulfill defined roles within the organizational structure.

Importance of Management

• Management is crucial for an organization's survival. Without it, confusion arises, and tasks are not correctly executed.
• Managers guide and control employee activities for efficient use of resources.
• Effective management coordinates different departments within an organization.
• Management provides a clear mission, vision and responds to changing environmental factors to maintain organizational stability.
• Management trains employees, boosting efficiency and productivity.

Levels of Management

• Top level: Owners, Board of Directors, Chief Executives, General Managers. Responsibilities include setting targets, creating strategic plans, assigning personnel, and handling financial responsibilities.
• Middle level: Marketing Managers, Production Managers, Finance Managers, HRD Managers, R&D Managers, Branch Managers. Responsibilities involve putting organizational plans into action, assigning tasks, supervising lower-level staff, and evaluating the performance of junior managers.
• Lower level: Foremen, Supervisors, Inspectors. Responsibilities include training employees, overseeing tasks per plan, maintaining discipline, and providing materials.

Functions of Top Level Management

• Setting objectives and policies
• Preparing strategic plans
• Appointing executives for middle level
• Issuing instructions for departmental budget
• Controlling and coordinating activities
• Handling financial responsibilities

Functions of Middle Level Management

• Establishing the organization
• Selecting staff for lower level
• Installing departments
• Designing operating policies
• Executing organizational plans
• Coordinating departmental activities
• Inspiring lower-level management
• Evaluating the performance of junior level managers

Functions of Lower Level Management

• Developing and improving work methods
• Providing finishing touches to plans
• Guiding day-to-day activities
• Maintaining quality and quantity
• Supervising subordinates
• Providing training to workers
• Organizing materials and machines
• Ensuring discipline
• Motivating workers

Administration vs. Management

• Administration is the overall execution of tasks.
• Duties may include maintaining documents, conducting meetings, executing policies, maintaining discipline, ensuring work is completed on time, and following legal guidelines.

Maslow's Hierarchy of Needs

• Physiological needs (food, water, warmth, rest)
• Safety needs (security, safety)
• Belongingness and love needs (intimate relationships, friends)
• Esteem needs (prestige, feeling of accomplishment)
• Self-actualization needs (achieving one's full potential)

Scientific Management

• A systematic approach to studying work methods to improve efficiency.
• Developed primarily by Frederick W. Taylor.

Advantages of Scientific Management

• Getting relevant information on time
• Realistic plans
• Reduced work time
• Matching suitable employees to jobs/equipment
• Identifying optimal work methods
• Reducing waste of time and materials
• Updating quality approaches
• Cost reduction

Principles of Scientific Management

• Management is a science, not based on individual experience
• Workers and managers collaborate to improve work methods
• Careful selection and training of workers
• Establishing fair levels of work performance

Principles of Management (Wider Context)

• Unity of Direction: Single plan for similar activities
• Unity of Command: Each person has only one supervisor
• Stability of Tenure: Employees should not be moved frequently
• Initiative: Encourage individuals to take initiative
• Centralization/Decentralization: Appropriate distribution of power
• Scalar Chain: Formal lines of authority and communication
• Equity: Treating employees fairly
• Remuneration: Paying employees fairly
• Order: Organizing and maintaining order
• Discipline: Employees should follow rules and regulations
• Authority and Responsibility: Delegating tasks and accepting accountability for results
• Subordination of Individual Interest to Common Good: Organizational goals take precedence over individual interests
• Division of Work: Specialization enhances productivity

Levels of Management Diagram

• Depicts the different levels of management: Top, Middle, and Lower. Levels are shown in a hierarchical pyramid structure, representing the vertical organization of the hierarchy in the managerial levels.

Evolution of Management Thought

• Summarizes the evolution of management viewpoints through different schools of thought.
• Details of evolution are chronologically presented showing which ideas were used during different periods like during 20th century, earlier than 20th, or later than that.

Schools of Management

• Classical School: Oldest. Focuses on effectively managing and organizing work to increase efficiency. This school encompasses three main areas - Scientific Management, Administrative Management, and Bureaucratic Management, each containing distinct components.
• Behavioral School: Focuses heavily on employee motivations and interactions. Sub-divisions such as Human Relations and Behavioral Science are vital components of this school of thought.
• Quantitative School: Improving managerial decision-making through the use of quantitative methods such as mathematical modeling, operations research, and computer tools.
• Systems School: Views organizations as systems made up of interconnected parts, requiring a holistic understanding of how inputs, processes, and outputs are related. The concept of constant interaction with the environment is crucial.
• Contingency School: Emphasizing adaptable management strategies based on specific situations and circumstances.

Features of Various Schools of Management - Detailed

• Information on individual characteristics of each school is given - like how each school focuses on efficiency and productivity or how individual behavior is observed in different organizations.

Planning

• Planning is outlining what, how, when, and by whom the work will be done to bridge the gap between current situations and future goals, aiming to organize efficiently.

Steps in Planning

• Identify goals
• Identify resources
• Identify tasks
• Prioritize tasks/goals
• Define deadlines
• Assess evaluation methods
• Identify possible courses of action

Organizing

• Coordinating company resources based on the planning process to effectively meet organizational goals through synchronizing human, physical, and financial resources.

Steps in Organizing

• Determining the tasks and duties
• Grouping tasks and duties
• Coordinating the work flow
• Delegating and assigning tasks

Directing

• Guiding, instructing, and motivating employees to help them correctly execute tasks.
• Strong leadership qualities and effective communication essential. A continuous process.

Subset of Directing (Functions)

• Communication: Passing information via various means and methods within the workforce, coordinating and ensuring everyone is on the same page.
• Leadership: Guiding and influencing subordinate employees to complete their designated roles and encourage commitment to organizational goals.
• Motivation: Inspiring employees to attain maximum performance. Encouraging participation in accomplishing the set goals and achieving their best.

Styles of Directing

• Consultative: Dialogue between managers and employees to ensure everyone is on the same page.
• Autocratic: Manager-driven approach without consultation.
• Democratic/Reinforced: Managers provide general guidelines, and employees have input rights.

Controlling

• Tracking and evaluating whether work is going correctly by measuring performance and correcting areas by taking appropriate actions.

Steps in Controlling

• Setting standards
• Measuring performance
• Comparing performance to standards
• Taking corrective action

Decision-Making

• An essential management skill to establish what, when, and how tasks should be executed.
• Modern methods incorporate computers and mathematical tools, including models, operations research to support decisions.

Steps in Decision-Making

• Recognize the problem
• Analyze the problem
• Define possible solutions
• Evaluate possible solutions
• Select the best solution
• Implement the solution

Teamwork

• Working together for a common objective is always more beneficial compared to working alone. Sharing responsibilities reduces individual burdens and encourages cooperation among team members.

Unity of Direction

• A single plan applies to activities with identical goals.

Stability of Tenure

• Employees should not face frequent job changes.
• Maintaining a stable workforce helps organizational sustainability, as employees are familiar with tasks and processes and are less likely to have a high staff turnover, making operations more efficient.

Scalar Chain

• Formal, well-defined lines of authority and communication that connect from top management to the lowest level of staff.

Esprit de Corps

• A collaborative and unified spirit uniting workforce members, fostering better work experiences.

Functions of Management Circular Diagram

• Illustrates the circular nature of management functions and how they interact. The functions such as Planning, Organizing, Directing, Controlling, and Staffing are interconnected for success.