What Is An Organization?

A formal and coordinated group of people who function to achieve particular goals These goals cannot be achieved by individuals acting alone

An organization has a structure.

An organization consists of a group of people striving to reach goals that individuals acting alone could not achieve.

A set of activities planning and decision making, organizing, leading, and controlling directed at an organizations resources human, financial, physical, and information with the aim of achieving organizational goals in an efficient and effective manner. A form of work that involves coordinating an organizations human, financial, physical and information resources toward accomplishing organizational objectives. Management
The process of getting things done, effectively and efficiently, through and with other people Efficiency

Means doing the thing correctly; refers to the relationship between inputs and

outputs; seeks to minimize resource costs

Effectiveness

Means doing the right things; goal attainment

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EXHIBIT 1.3 14

Efficiency:
Operating in such a way that resources are not wasted

Effectiveness: Successful Management

Doing the right things in the right way at the right times

Source: Adapted from Van Fleet, David D., Contemporary Management, Second Edition. 15

Henri Fayol(1916):To manage is to forecast and plan ,to organize, to command, to coordinate and control

Peter. F. Drucker(1955):Management is concerned with the systematic organization of economic Resources and its task is to make these resources productive.

Management is a social process It also denotes a a body of people involved in decision making It is inexact science It is an art and also science It is profession It is inter-disciplinary It is complex

It facilitates the achievements of goals through limited resources It ensures smooth sailing in case of difficulties It ensures continuing in the organization It ensures economy and efficiency It focus on group efforts It is the key to the economic growth

Organizing

Planning

Leading

Controlling
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Planning

Setting an organizations goals and selecting a course of action to achieve them. Determining how activities and resources are grouped. Getting organizational members to work together to advance the interests of the organization. Monitoring organizational progress towards goals.

Organizing

Leading

Controlling

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Planning and decision making Inputs from the environment Human resources Financial resources Physical resources Information resources Controlling

Organizing

Goals attained Efficiently Effectively

Leading

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Management process: planning, organizing, leading, and controlling

EXHIBIT 1.4 113

Planning involves tasks that must be performed to attain organizational goals, outlining how the tasks must be performed, and indicating when they should be performed.
Planning Includes defining goals, establishing strategy, and developing plans to coordinate activities
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Planning

Environmental scanning and analysis Developing a vision of the future Setting long-term organizational objectives Developing organizational and competitive strategies

Planning includes identifying goals, objectives, methods, resources needed to carry out methods, responsibilities and dates for completion of tasks. Examples of planning are strategic planning, business planning, project planning, staffing planning, advertising and promotions planning, etc.

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Planning
Determining organizational goals and means to reach them Managers plan for three reasons
1. Establish an overall direction for the organizations future

2. Identify and commit resources to achieving goals

3. Decide which tasks must be done to reach those goals

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Organizing means assigning the planned tasks to various individuals or groups within the organization and cresting a mechanism to put plans into action.

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Organizing

Includes determining what tasks to be done, who is to do them, how the tasks are to be grouped, who reports to whom, and where decisions are to be made

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Organizing

Defining tasks and duties Grouping positions into effective structures (departments) Clarifying authority, responsibility, and reporting relationships Allocating scarce resources (financial, human, physical) Staffing positions with qualified personnel

Organizing resources to achieve the goals in an optimum fashion. Examples are organizing new departments, human resources, office and file systems, re-organizing businesses, etc

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Organizing

Process of deciding where decisions will be made, who will perform what jobs and tasks, and who will report to whom in the company Includes creating departments and job descriptions

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Leading (Influencing) means guiding the activities of the organization members in appropriate directions. Objective is to improve productivity.
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Leading
Effective communication Inspiring others to do their best Motivation and rewards Trust and assurance Leading, including to set direction for the organization, groups and individuals and also influence people to follow that direction. Examples are establishing strategic direction (vision, values, mission and / or goals) and championing methods of organizational performance management to pursue that direction.

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Leading

Includes motivating employees, directing the activities of others, selecting the most effective communication channel, and resolving conflicts

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Leading
Getting others to perform the necessary tasks by motivating them to achieve the organizations goals Crucial element in all functions

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1. Gather information that measures recent performance 2. Compare present performance to pre-established standards 3. Determine modifications to meet pre-established standards
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Controlling, or coordinating, the organization's systems, processes and structures to reach effectively and efficiently reach goals and objectives. This includes ongoing collection of feedback, and monitoring and adjustment of systems, processes and structures accordingly. Examples include use of financial controls, policies and procedures, performance management processes, measures to avoid risks etc. Controlling

Controlling

Clear standards Monitoring progress and results Knowing when and how to intervene Correcting deviations successfully

The process of monitoring performance, comparing it with goals, and correcting any significant deviations
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Controlling
Process by which a person, group, or organization consciously monitors performance and takes corrective action

Discussed in depth in Chapter 10

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Marketing Managers

Work in areas related to getting consumers and clients to buy the organizations products or services. Deal primarily with an organizations financial resources. Concerned with creating and managing the systems that create organizations products and services Involved in planning, recruiting and selection, training and development, designing compensation and benefit systems, formulating performance appraisal systems. Serve as generalists in functional areas and are not associated with any particular management specialty.
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Financial Managers

Operations Managers

Human Resource Managers

Administrative Managers

The Science of Management

Assumes that problems can be approached using rational, logical, objective, and systematic ways. Requires technical, diagnostic, and decision-making skills and techniques to solve problems.

The Art of Management

Decisions are made and problems solved using a blend of intuition, experience, instinct, and personal insights. Requires conceptual, communication, interpersonal, and time-management skills to accomplish the tasks associated with managerial activities.

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Systems Approach Recognition of internal interdependencies Recognition of environmental influences Classical Management Perspectives Methods for enhancing efficiency and facilitating planning, organizing, and controlling

Contingency Perspective Recognition of the situational nature of management Response to particular characteristics of situation Behavioral Management Perspectives Insights for motivating performance and understanding individual behavior, groups and teams, and leadership Quantitative Management Perspectives Techniques for improving decision making, resource allocation, and operations

Effective and efficient management

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How management theory and practice has evolved over time

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An increasingly diverse and globalized workforce The need to create challenging, motivating, and flexible work environments Acute labor shortages in high-technology job sectors and an oversupply of less-skilled labor The effects of information technology on how people work The complex array of new ways of structuring organizations Increasing globalization of product and service markets The renewed importance of ethics and social responsibility The use of quality as the basis for competition The shift to a predominately service-based economy

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