MANAGEMENT

Functions of Management

1. Planning
It is the basic function of management. It deals with chalking out a future course of action &
deciding in advance the most appropriate course of actions for achievement of pre-determined
goals. According to KOONTZ, Planning is deciding in advance - what to do, when to do & how to
do. It bridges the gap from where we are & where we want to be. A plan is a future course of
actions. It is an exercise in problem solving & decision making. Planning is determination of
courses of action to achieve desired goals. Thus, planning is a systematic thinking about ways &
means for accomplishment of pre-determined goals. Planning is necessary to ensure proper
utilization of human & non-human resources. It is all pervasive, it is an intellectual activity and it
also helps in avoiding confusion, uncertainties, risks, wastages etc.

2. Organizing
It is the process of bringing together physical, financial and human resources and developing
productive relationship amongst them for achievement of organizational goals. According to
Henry Fayol, To organize a business is to provide it with everything useful or its functioning i.e.
raw material, tools, capital and personnels. To organize a business involves determining &
providing human and non-human resources to the organizational structure.

3. Staffing
It is the function of manning the organization structure and keeping it manned. Staffing has
assumed greater importance in the recent years due to advancement of technology, increase in
size of business, complexity of human behavior etc. The main purpose o staffing is to put right
man on right job i.e. square pegs in square holes and round pegs in round holes. According to
Kootz & ODonell, Managerial function of staffing involves manning the organization structure
through proper and effective selection, appraisal & development of personnel to fill the roles
designed un the structure.

4. Directing
It is that part of managerial function which actuates the organizational methods to work efficiently
for achievement of organizational purposes. It is considered life-spark of the enterprise which sets
it in motion the action of people because planning, organizing and staffing are the mere
preparations for doing the work. Direction is that inert-personnel aspect of management which
deals directly with influencing, guiding, supervising, motivating sub-ordinate for the achievement
of organizational goals.

5. Controlling
It implies measurement of accomplishment against the standards and correction of deviation if
any to ensure achievement of organizational goals. The purpose of controlling is to ensure that
everything occurs in conformities with the standards. An efficient system of control helps to
predict deviations before they actually occur. According to Theo Haimann, Controlling is the
process of checking whether or not proper progress is being made towards the objectives and
goals and acting if necessary, to correct any deviation. According to Koontz & ODonell
Controlling is the measurement & correction of performance activities of subordinates in order to
make sure that the enterprise objectives and plans desired to obtain them as being
accomplished.

Levels of Management

1. Top Level of Management

It consists of board of directors, chief executive or managing director. The top management is the
ultimate source of authority and it manages goals and policies for an enterprise. It devotes more
time on planning and coordinating functions.
The role of the top management can be summarized as follows a. Top management lays down the objectives and broad policies of the enterprise.
b. It issues necessary instructions for preparation of department budgets, procedures,
schedules etc.
c.

It prepares strategic plans & policies for the enterprise.

d. It appoints the executive for middle level i.e. departmental managers.

e. It controls & coordinates the activities of all the departments.
f.

It is also responsible for maintaining a contact with the outside world.

g. It provides guidance and direction.

h. The top management is also responsible towards the shareholders for the performance
of the enterprise.

2. Middle Level of Management

The branch managers and departmental managers constitute middle level. They are responsible
to the top management for the functioning of their department. They devote more time to
organizational and directional functions. In small organization, there is only one layer of middle
level of management but in big enterprises, there may be senior and junior middle level
management. Their role can be emphasized as a. They execute the plans of the organization in accordance with the policies and directives
of the top management.
b. They make plans for the sub-units of the organization.
c.

They participate in employment & training of lower level management.

d. They interpret and explain policies from top level management to lower level.
e. They are responsible for coordinating the activities within the division or department.
f.

It also sends important reports and other important data to top level management.

g. They evaluate performance of junior managers.

h. They are also responsible for inspiring lower level managers towards better performance.

3. Lower Level of Management

Lower level is also known as supervisory / operative level of management. It consists of
supervisors, foreman, section officers, superintendent etc. According to R.C. Davis, Supervisory
management refers to those executives whose work has to be largely with personal oversight and
direction of operative employees. In other words, they are concerned with direction and
controlling function of management. Their activities include a. Assigning of jobs and tasks to various workers.
b. They guide and instruct workers for day to day activities.
c.

They are responsible for the quality as well as quantity of production.

d. They are also entrusted with the responsibility of maintaining good relation in the
organization.
e. They communicate workers problems, suggestions, and recommendatory appeals etc to
the higher level and higher level goals and objectives to the workers.
f.

They help to solve the grievances of the workers.

g. They supervise & guide the sub-ordinates.

h. They are responsible for providing training to the workers.
i.

They arrange necessary materials, machines, tools etc for getting the things done.

j.

They prepare periodical reports about the performance of the workers.

k.

They ensure discipline in the enterprise.

l.

They motivate workers.

m. They are the image builders of the enterprise because they are in direct contact with the
workers.

MANAGERIAL ROLES

Managers are the people who plan, organize, lead, and control the activities of the
organization so that its goals can be achieved. Managerial roles talks about the
roles managers play in the organization. Henry Mintzberg identified three major
roles of a manager as follows:

In interpersonal roles, the manager is responsible for managing relationships within

and outside the organization. The manager must play a role as a figurehead, a
leader and a liaison. In informational roles, the manager is responsible for gathering
and distributing information to the stakeholders of the organization. Types of
informational roles are monitor, disseminator, and spokesperson. Finally, in
decisional roles, the manager is reponsible for processing information and reaching
conclusions. Types of decisional roles are entrepreneur, disturbance handler,
resource allocator and negotiator. (Refer to your notes for explanation on the
different types of roles.)

MANAGERIAL SKILLS (MANAGEMENT SKILLS)

Being a manager is not an easy task as he/she is not only required to perform a job
well, he/she is also required to manage, direct and motivate his/her subordinate to
perform their job well. Therefore, being a manager requires a certain set of skills.

There are three levels of managers namely first-line managers, middle level
managers and top level managers. First line managers supervise the individuals
who are directly responsible for producing the organizations product or delivering
its service. They carry the title production supervisor, section chief. Middle level
managers supervises first-line managers or staff department. They carry titles such
as marketing manager or department head. Top level managers provide the
strategic direction for the organization. They carry titles such as CEO, CFO, CIO or
executive vice president.

The figure below indicates the skills managers must have and the degree of
importance for each level of managers.

Conceptual skills is the ability to analyze complex information. It enables managers

to process information about the internal/external environment of the organization
and determine its implications. Top level managers need to have strong conceptual
skills if they are to effectively accomplish goals.

Human skills is the ability to work effectively with people. It involves motivating
and disciplining employees, monitoring performance, providing feedback, improving
communication and instructing employees. Human skills are most important for
middle managers as these managers must coordinate efforts of the members in his
group as well as other work groups within the organization.

Technical skills is the knowledge and the ability to use tools, techniques and
procedures that are specific to their particular field. Technical skills tend to be most
important for first line managers as they must have the knowledge and the "knowhow" to ensure that the products and services of their organization are delivered to
customer.

Management by Objectives (MBO) is a personnel management technique where managers and

employees work together to set, record and monitor goals for a specific period of time.
Organizational goals and planning flow top-down through the organization and are translated into
personal goals for organizational members. The technique was first championed by management
expert Peter Drucker and became commonly used in the 1960s.

Key Concepts
The core concept of MBO is planning, which means that an organization and its members are not
merely reacting to events and problems but are instead being proactive. MBO requires that
employees set measurable personal goals based upon the organizational goals. For example, a goal
for a civil engineer may be to complete the infrastructure of a housing division within the next twelve
months. The personal goal aligns with the organizational goal of completing the subdivision.
MBO is a supervised and managed activity so that all of the individual goals can be coordinated to
work towards the overall organizational goal. You can think of an individual, personal goal as one

piece of a puzzle that must fit together with all of the other pieces to form the complete puzzle: the
organizational goal. Goals are set down in writing annually and are continually monitored by
managers to check progress. Rewards are based upon goal achievement.

Advantages
MBO has some distinct advantages. It provides a means to identify and plan for achievement of
goals. If you don't know what your goals are, you will not be able to achieve them. Planning permits
proactive behavior and a disciplined approach to goal achievement. It also allows you to prepare for
contingencies and roadblocks that may hinder the plan. Goals are measurable so that they can be
assessed and adjusted easily. Organizations can also gain more efficiency, save resources, and
increase organizational morale if goals are properly set, managed, and achieved.

Disadvantages
However, MBO is not without disadvantages. Application of MBO takes concerted effort. You cannot
rely upon a thoughtless, mechanical approach, and you should note that some tasks are so simple
that setting goals makes little sense and becomes more of silly, annual ritual. For example, if your job
is snapping two pieces of a product together on an assembly line, setting individual goals for your
work isn't really necessary.
Rodney Brim, a CEO and critic of the MBO technique, has identified four other weaknesses. There is
often a focus on mere goal setting rather than developing a plan that can be implemented. The
organization often fails to take into account environmental factors that hinder goal achievement, such
as lack of resources or management support. Organizations may also fail to monitor for changes,
which may require modification of goals or even make them irrelevant. Finally, there is the issue of
plain human neglect - failing to follow through on the goal.

Models of Decision Making

The Rational Model Consists of a structured four-step sequence: identifying
the problem generating alternative solutions selecting a solution implementing
and evaluating the solution

Simons Normative Model - Based on premise that decision making is not rational Decision making is characterized by * limited information processing * use of rules
of thumb or shortcuts * satisficing Assets of Group Decision Making Groups can
accumulate more knowledge and facts Groups have a broader perspective and
consider more alternative solutions Individuals who participate in decisions are
more satisfied with the decision and are more likely to support it. Group decision
making processes serve an important communication function as well as a useful
political function. 3 Liabilities of Group Decision Making Groups often work more
slowly than individuals. Groups decisions involve considerable compromise that
may lead to less than optimal decisions. Groups are often dominated by one
individual or a small clique, thereby negating many of the virtues of group
processes. Overreliance on group decision making can inhibit managements
ability to act quickly and decisively when necessary. Individual vs. Group Decision
Making In establishing objectives, groups are probably superior to individuals
because of the greater amount of knowledge available to groups. In identifying
alternatives, the individual efforts of group members encourage a broad search in
various functional areas of the organization. In evaluating alternatives, the
collective judgement of the group, with its wider range of viewpoints, seems
superior to that of the individual decision maker. 4 Individual vs. Group Decision
Making In choosing an alternative, group interaction and the achievement of
consensus usually result in the acceptance of more risk than would be accepted by
an individual decision maker. Implementing a decision, whether or not it was
made by a group, is usually accomplished by individual managers.