Basics of Management PDF

1. THE BASICS OF MANAGEMENT In this chapter you can find out: - The concept of management - Management activities - The relationship between activities - With corporate resources - Management approaches - The need for management THE BASICS OF MANAGEMENT Th...

1. THE BASICS OF MANAGEMENT In this chapter you can find out: - The concept of management - Management activities - The relationship between activities - With corporate resources - Management approaches - The need for management THE BASICS OF MANAGEMENT The concept of management has been derived from leadership in relation to business, leadership as an activity and leadership as an institution. Management is understood as an activity, and the person doing the managing is called the management. The use of management can mean both the activity of the manager, methodological apparatus and management body. The terms leadership, control, administration and direction are also used. Management, as a science and as an integrated concept of managerial activities, dates back to the 19th century and has undergone significant transformations both in its formulation and in its substance. This transformation is illustrated by some further definitions that attempt to capture the essence of management; Taylor (in the early 20th century): management is nothing more than knowing exactly what you want your people to do, what you want them to do, and then seeing if they did it the cheapest way. Collins - business dictionary: to take care of a certain activity; to carry out an activity successfully. Honoton & Kentucky teachers: the process of one or more people coordinating the activities of others to achieve results that they could not achieve on their own. Atlanta: a process of giving instructions to a group of people in order to achieve the goals of the organisation. A business vocabulary: the implementation of the policies formulated, the definition of the results to be achieved, the way to achieve them, the creation and management of the necessary organisation and the responsibility for it. Using the various definitions and interpretations, we can perhaps summarise and formulate management as the set of activities that ensure that the available resources are used effectively and efficiently in order to achieve the organisational goals. Management is therefore a set of activities carried out in relation to organisational objectives and available resources, which are directed towards the tasks of planning, organising, leading and controlling. 1 BASICS OF MANAGEMENT Management and its tasks Management is the process of coordinating the activities of one or more people to achieve results that none of them could achieve alone. Management is not a specific profession, in all walks of life people work together with some purpose. Management is the science of effective and efficient group action, individual and organisational functioning. It provides methods, theories drawn from practical experience, answers to the question of how individuals, acting in groups or organisations, achieve their goals with the best possible effectiveness. Management process, management is necessary to carry out tasks and activities, to achieve business objectives Management can be targeted at individuals or organisations. In management, the leader does not influence the led directly, but indirectly. Management is a direct influence on those being managed. Management functions are. Management functions at different levels of the organisation are illustrated in the following diagram: The essence of management activities can be summarised as follows: 1, planning (-planning-) It means setting organisational goals, choosing the best way to achieve them. 2, organising (-organizing-) Logically follows planning, the grouping of resources and activities of the organisation according to the objectives of the organisation (division of labour, organisation of departments, powers of managers, job descriptions of staff). 3, leading (-leading-) An attempt to influence people's behaviour. All such attempts are considered leading, regardless of the outcome. Every leader is also a "led", because leadership is a two-way process, the interaction between the leader and the led in each situation determines the decision. The direction of the influence is irrelevant (it can be positive or negative). If the experiment is unsuccessful, it is still considered as leadership. 4, monitoring (-controlling-) The monitoring, control and modification of organisational activities to achieve organisational objectives. Each management activity builds on the others. Planning and control create the balance between the external and internal environment, while organisation and management influence environmental factors and resources. Planning is the process of assessing the current state of the environment, considering the alternatives for the future and, depending on this, setting 2 BASICS OF MANAGEMENT objectives and a course of action, while monitoring is the primary task of constantly checking the correctness of assumptions and solutions, and of adapting objectives and solutions to the environment as it is. The relationship between the system of management activities is illustrated in the following figure: Source: Imreh et al 2008.p.45. These activities cannot be understood in isolation, management activities cannot be shared in the life of the company (there is no corporate unit that deals only with planning, only with organisation, only with management, only with control), in the functions of leadership, management - the functions to be performed Management skills, the application of the objectives of the stakeholders and the initial conditions Planning Organising Managing Controlling Feedback Communication, which is the link between the company and its environment Output tasks and positioning - the parallel, continuous validation and exercise of these activities. This means that, although all four activities are continuously exercised within the remit of management, they are exercised at different levels of the organisation with different degrees of importance. While at the bottom management level, leadership is the most important task, at the middle management level, organisation becomes the focus of activities alongside leadership, and at the top management level, planning and organisation provide most of the managerial tasks. 3 BASICS OF MANAGEMENT  Source: Imreh et al 2008.p.46. The various activities are exercised in pursuit of the organisational objectives set, which requires an explanation of a complex concept. Organisational objectives are always expressed in a hierarchical system of objectives, the elements of which, the order of importance of the individual sub-objectives, are constantly changing according to the external and internal environmental framework conditions. The environmental framework conditions are provided by individual and group stakeholders, whose changing interests are not only expressed when the company's objectives are being set, but also when the objectives are being implemented, constantly changing the organisation's objectives. The raison d'être of a company is to satisfy consumer needs, since every company, every organisation is created to serve at least one market (be it a market for non-profit activities). If it does not strive to serve this target market(s) to the highest possible level, it will quickly be turned away by consumers and its sustainability will be threatened, and it may be liquidated within a certain period of time. Consumer needs are met by the staff of the organisations. However, our society today cannot be divided into a consumer society and a producer society, i.e. every member of a company is a consumer as well as a worker, with socio-cultural needs in addition to material needs. We cannot expect any of our workers to work 8 hours a day as a machine for a decent wage and then satisfy their needs exclusively in the consumer society that exists beyond the gates of the organisation. This assumption has led us astray on many occasions. Our workers can only adequately meet the needs of the organisation's consumers if their needs are also continually met. If an organisation trusts its employees, relies on their initiative and responsibility, and allows them to satisfy their social needs in addition to their material needs, then these people are willing to work with great energy for the organisation and to contribute directly or indirectly to meeting consumer needs at the highest possible level. However, satisfying internal and external needs can be extremely costly, as an organisation may satisfy the needs of both consumers and employees to a high level, but eventually become loss-making and go into liquidation. In order to avoid this problem, it is necessary to bear in mind the profitability criterion, which is a prerequisite for the other two 4 BASICS OF MANAGEMENT main objectives, since profit is the source of new improvements; it enables employees to be rewarded and systems to be put in place to meet their social needs; it results in new investments by the owners; and it creates the basis for a stable competitive position. These goals present a constant dilemma for corporate goal-setters, since there is no external satisfaction without adequate internal satisfaction and vice versa, and no profit without adequate internal and external satisfaction and vice versa. These fundamental problems highlight the internal dilemmas of companies and the internal rationale for their ever- changing target systems. Source: Lővey 1994 III.3 The relationship between management and the utilisation of resources The resources available are the initial conditions for management activities, the assets with which, or through the transformation of which, organisational goals can be achieved through individual activities and tasks. There are four basic groups of resources: physical, financial, human and information resources. Management activities involve the management of the company's own resources and of external resources that can be acquired. The main objective is to convert resources as inputs into products and services to meet consumer needs, while those performing management tasks must keep in mind the principle of optimal expenditure (i.e. the highest possible return on the lowest possible investment). The subject of corporate management, corporate resources. The four key resources over which decisions must be made on an ongoing basis are: Human resources: physical and mental abilities and skills of managers and subordinates, development of existing and potential competences, recruitment of new staff Physical resources: buildings, equipment, stocks, raw materials, machinery used or invested in by the company in the course of its activities. We also include natural resources, the values of the natural environment (for example, the values of the natural and built environment surrounding the organisation's office building - parks, fountains, etc.) Financial resources: all own and external (credit, loan) mobile financial resources that provide the liquidity of the company, which the company invests or may invest as capital in its operations or investments. They are embodied in central bank money and bank account money, which allow for immediate convertibility into human, physical or information resources in economic processes. Information resources: internal and external information that can be used in a systematic way for the benefit of the company. This includes, but is not limited to, market analysis of all kinds, knowledge of daily sales, stock levels, and news and business developments that have come to the attention of decision-makers in face-to-face meetings or as confidential messages. 5 BASICS OF MANAGEMENT The relationship between resources, objectives and management activities is illustrated in the figure below: Source: Imreh et al 2008.p.49. From what we have read so far, we can see that managers need to integrate different perspectives and ways of thinking in their work. Gosling and Mintzberg (2004) identify five types of thinking. These are:  "self-management: reflective thinking,  managing organisations: analytical thinking,  context management: worldly thinking,  relationship management: collaborative thinking,  change management: action-oriented thinking." (Gosling - Mintzberg, 2004, p. 8) The table below compares the two types of management. "Heroic management" (based on ourselves) "Tuning management" (based on cooperation) Managers are important people. They are separate Managers are important in that they help others in from product developers and service providers. product development and service. The higher these managers get, the more important The organization is an interactive network, no vertical they become. At the "top", the CEO is the company hierarchy. Successful leaders work everywhere in the itself. organization, not at the top. The - clear, well-thought-out and decisive - strategy Strategies emerge from networks1 as active people spreads downwards in the hierarchy. It comes from tackle small problems that grow into large initiatives. the boss who takes the dramatic steps. Everyone else "implements". Implementation is a problem because even though Implementation is a problem because it cannot be the boss is in favor of the change, the others are separated from formulation. That's why dedicated resistant. This is why outsiders should be preferred internal people are needed for key changes. over insiders. Management is decision-making and resource Management is the bringing to the surface of the allocation, i.e. analysis, often calculation, based on positive energy inherent in the nature of people, that the facts of the reports. is, stimulation and attunement based on the opinion rooted in the context. Managers are rewarded for increasing performance. Everyone is rewarded for making the organization What matters is what can be measured - especially better. Human values, which are mostly shareholder value. unmeasurable, are important. Leadership is imposed on those who impose their will Leadership is a sacred duty earned through respect on others. for others. Forrás: Gosling – Mintzberg, 2004,p.13. 6 BASICS OF MANAGEMENT The fusion of these mindsets in everyday action has produced two types of management, which the authors just quoted call "heroic" management and "attuning" management. The relationship between theory and practice in contemporary management Since the work of Taylor and Fayol, the science of management has produced a library of textbooks, monographs, research reports and academic journal articles 'from across the Atlantic'. The question often arises: do practising managers (leaders) need the vast amount of knowledge and insight that is recorded in these works? In other words: do practitioners need to be concerned with management theory? To put the possible answers to the above questions in very simple terms, two extreme perceptions can be observed: 1) "Driving by the book" 2) "Leading from the pocket" In the first case, the manager/leader accepts and applies without criticism the theories that science develops and publishes. (In cynical terms HOT = Heathrow Organisation Theory, the source works of these theories, which can be bought in the London airport bookshop and learnt to application level on a flight.) The second case is the complete dumbing down of the results of management science. Deeming them superfluous and useless. Instead, we are left with inherited routine, instinct, egoism and narcissism, decision-making based on intuition: in other words, everything that does not require managerial learning and knowledge. Of course, as in other cases, the two perceptions (and practices) are not 'black and white' problems. Rather, we are dealing with "fifty - or more - shades of grey", i.e. a mix of possibilities. The question is always the trend, the direction of the trend. In management, the 20th century shows the dominance of the proliferation of theories. The same was observed in other fields of social science. Consciousness and knowledge permeated the functioning of society, with models of the public good provider competing with each other, underpinned by different theories. Except in extreme dictatorships, this has been the case under market economy conditions in the vast majority of countries. Conflicts, crises, only Management principles and functions have confirmed to both research and practitioners (i.e. owners and managers acting on their behalf) that without unity of theory and practice there can be no progress or economic development. LITERATURE: Imreh Szabolcs, Kürtüsi Zsófia, Majó Zoltán, Vilmányi Márton (2008):Menedzsment I., Szeged Roland Kiss-Tóth (2015):Management, Eger József Roósz (200/) The Basics of Management, Budapest 7 BASICS OF MANAGEMENT