Business Management

Management in business and human organization activity, in simple terms means the act of getting people together to accomplish desired goals. Management comprises planning, organizing, resourcing, leading or directing, and controlling an organization (a group of one or more people or entities) or effort for the purpose of accomplishing a goal. Resourcing encompasses the deployment and manipulation of human resources, financial resources, technological resources, and natural resources. Management can also refer to the person or people who perform the act(s) of management.

Contents

1 Overview o 1.1 heoretical scope

o

1.! "ature of managerial wor#

! $istorical development
o

!.1 %arly writing

!.1.1 &un zu's he (rt of )ar !.1.! "iccol* Machiavelli's he +rince !.1., (dam &mith's he )ealth of "ations

o o o

!.! 1-th century !., !.th century !./ !1st century

, Management topics
o o

,.1 0asic functions of management ,.! 1ormation of the business policy

,.!.1 $ow to implement policies and strategies ,.!.! he development of policies and strategies ,.!., )here policies and strategies fit into the planning process

,., Managerial levels and hierarchy

/ (reas and categories and implementations of management 2 &ee also 3 References

4 %5ternal lin#s

Overview
he verb manage comes from the 6talian maneggiare (to handle 7 especially a horse), which in turn derives from the 8atin manus (hand). he 1rench word mesnagement (later mnagement) influenced the development in meaning of the %nglish word management in the 14th and 19th centuries.:1;

Theoretical scope
Mary +ar#er 1ollett (1939<1-,,), who wrote on the topic in the early twentieth century, defined management as =the art of getting things done through people=. :!; One can also thin# of management functionally, as the action of measuring a >uantity on a regular basis and of ad?usting some initial plan@ or as the actions ta#en to reach one's intended goal. his applies even in situations where planning does not ta#e place. 1rom this perspective, 1renchman $enri 1ayol:,; considers management to consist of five functionsA
1. planning 2. organizing 3. leading 4. coBordinating 5. controlling

&ome people, however, find this definition, while useful, far too narrow. he phrase =management is what managers do= occurs widely, suggesting the difficulty of defining management, the shifting nature of definitions, and the connection of managerial practices with the e5istence of a managerial cadre or class. One habit of thought regards management as e>uivalent to =business administration= and thus e5cludes management in places outside commerce, as for e5ample in charities and in the public sector. More realistically, however, every organization must manage its wor#, people, processes, technology, etc. in order to ma5imize its effectiveness. "onetheless, many people refer to university departments which teach management as =business schools.= &ome institutions (such as the $arvard 0usiness &chool) use that name while others (such as the Cale &chool of Management) employ the more inclusive term =management.= &pea#ers of %nglish may also use the term =management= or =the management= as a collective word describing the managers of an organization, for e5ample of a corporation. $istorically this use of the term was often contrasted with the term =8abor= referring to those being managed.

Nature of managerial work

6n forBprofit wor#, management has as its primary function the satisfaction of a range of sta#eholders. his typically involves ma#ing a profit (for the shareholders), creating valued products at a reasonable cost (for customers), and providing rewarding employment

opportunities (for employees). 6n nonprofit management, add the importance of #eeping the faith of donors. 6n most models of managementDgovernance, shareholders vote for the board of directors, and the board then hires senior management. &ome organizations have e5perimented with other methods (such as employeeBvoting models) of selecting or reviewing managers@ but this occurs only very rarely. 6n the public sector of countries constituted as representative democracies, voters elect politicians to public office. &uch politicians hire many managers and administrators, and in some countries li#e the Enited &tates political appointees lose their ?obs on the election of a new presidentDgovernorDmayor. +ublic, private, and voluntary sectors place different demands on managers, but all must retain the faith of those who select them (if they wish to retain their ?obs), retain the faith of those people that fund the organization, and retain the faith of those who wor# for the organization. 6f they fail to convince employees of the advantages of staying rather than leaving, they may tip the organization into a downward spiral of hiring, training, firing, and recruiting. Management also has the tas# of innovating and of improving the functioning of organizations.

Historical development
Fifficulties arise in tracing the history of management. &ome see it (by definition) as a late modern (in the sense of late modernity) conceptualization. On those terms it cannot have a preBmodern history, only harbingers (such as stewards). Others, however, detect managementBli#e activities in the preBmodern past. &ome writers :who?; trace the development of managementBthought bac# to &umerian traders and to the builders of the pyramids of ancient %gypt. &laveBowners through the centuries faced the problems of e5ploitingDmotivating a dependent but sometimes unenthusiastic or recalcitrant wor#force, but many preBindustrial enterprises, given their small scale, did not feel compelled to face the issues of management systematically. $owever, innovations such as the spread of (rabic numerals (2th to 12th centuries) and the codification of doubleBentry boo#B#eeping (1/-/) provided tools for management assessment, planning and control. Given the scale of most commercial operations and the lac# of mechanized recordB#eeping and recording before the industrial revolution, it made sense for most owners of enterprises in those times to carry out management functions by and for themselves. 0ut with growing size and comple5ity of organizations, the split between owners (individuals, industrial dynasties or groups of shareholders) and dayBtoBday managers (independent specialists in planning and control) gradually became more common.

Early writing
)hile management has been present for millennia, several writers have created a bac#ground of wor#s that assisted in modern management theories.:/; Sun T u!s The Art of War

)ritten by Hhinese general &un zu in the 3th century 0H%, The Art of War is a military strategy boo# that, for managerial purposes, recommends being aware of and acting on strengths and wea#nesses of both a manager's organization and a foe's.:/; Niccol" Machiavelli!s The Prince 0elieving that people were motivated by selfBinterest, "iccol* Machiavelli wrote The Prince in 121, as advice for the leadership of 1lorence, 6taly.:2; Machiavelli recommended that leaders use fear7but not hatred7to maintain control. #dam Smith!s The Wealth of Nations )ritten in 1443 by (dam &mith, a &cottish moral philosopher, The Wealth of Nations aims for efficient organization of wor# through division of labor.:2; &mith described how changes in processes could boost productivity in the manufacture of pins. )hile individuals could produce !.. pins per day, &mith analyzed the steps involved in manufacture and, with 1. specialists, enabled production of /9,... pins per day.:2;

$%th century
&ome argue:citation needed; that modern management as a discipline began as an offBshoot of economics in the 1-th century. Hlassical economists such as (dam &mith (14!, B 14-.) and Iohn &tuart Mill (19.3 B 194,) provided a theoretical bac#ground to resourceBallocation, production, and pricing issues. (bout the same time, innovators li#e %li )hitney (1432 B 19!2), Iames )att (14,3 B 191-), and Matthew 0oulton (14!9 B 19.-) developed elements of technical production such as standardization, >ualityBcontrol procedures, costBaccounting, interchangeability of parts, and wor#Bplanning. Many of these aspects of management e5isted in the preB1931 slaveBbased sector of the E& economy. hat environment saw / million people, as the contemporary usages had it, =managed= in profitable >uasiBmass production. 0y the late 1-th century, marginal economists (lfred Marshall (19/! B 1-!/), 8Jon )alras (19,/ B 1-1.), and others introduced a new layer of comple5ity to the theoretical underpinnings of management. Ioseph )harton offered the first tertiaryBlevel course in management in 1991.

&'th century
0y about 1-.. one finds managers trying to place their theories on what they regarded as a thoroughly scientific basis (see scientism for perceived limitations of this belief). %5amples include $enry R. owne's Science of management in the 19-.s, 1rederic# )inslow aylor's Scientific management (1-11), 1ran# and 8illian Gilbreth's Applied motion study (1-14), and $enry 8. Gantt's charts (1-1.s). I. Funcan wrote the first college management te5tboo# in 1-11. 6n 1-1! Coichi Eeno introduced aylorism to Iapan and became first management consultant of the =IapaneseBmanagement style=. $is son 6chiro Eeno pioneered Iapanese >ualityBassurance. he first comprehensive theories of management appeared around 1-!.. he $arvard 0usiness &chool invented the Master of 0usiness (dministration degree (M0() in 1-!1. +eople li#e $enri 1ayol (19/1 B 1-!2) and (le5ander Hhurch described the various branches of management and their interBrelationships. 6n the early !.th century, people li#e Ordway

ead (19-1 B 1-4,), )alter &cott and I. Mooney applied the principles of psychology to management, while other writers, such as %lton Mayo (199. B 1-/-), Mary +ar#er 1ollett (1939 B 1-,,), Hhester 0arnard (1993 B 1-31), Ma5 )eber (193/ B 1-!.), Rensis 8i#ert (1-., B 1-91), and Hhris (rgyris (1-!, B ) approached the phenomenon of management from a sociological perspective. +eter Fruc#er (1-.- < !..2) wrote one of the earliest boo#s on applied managementA Concept of the Corporation (published in 1-/3). 6t resulted from (lfred &loan (chairman of General Motors until 1-23) commissioning a study of the organisation. Fruc#er went on to write ,- boo#s, many in the same vein. $. Fodge, Ronald 1isher (19-. B 1-3!), and hornton H. 1ry introduced statistical techni>ues into managementBstudies. 6n the 1-/.s, +atric# 0lac#ett combined these statistical theories with microeconomic theory and gave birth to the science of operations research. Operations research, sometimes #nown as =management science= (but distinct from aylor's scientific management), attempts to ta#e a scientific approach to solving management problems, particularly in the areas of logistics and operations. &ome of the more recent developments include the heory of Honstraints, management by ob?ectives, reengineering, &i5 &igma and various informationBtechnologyBdriven theories such as agile software development, as well as group management theories such as Hog's 8adder. (s the general recognition of managers as a class solidified during the !.th century and gave perceived practitioners of the artDscience of management a certain amount of prestige, so the way opened for popularised systems of management ideas to peddle their wares. 6n this conte5t many management fads may have had more to do with pop psychology than with scientific theories of management. owards the end of the !.th century, business management came to consist of si5 separate branches, namelyA

$uman resource management Operations management or production management &trategic management Mar#eting management 1inancial management 6nformation technology management responsible for management information systems

&$st century
6n the !1st century observers find it increasingly difficult to subdivide management into functional categories in this way. More and more processes simultaneously involve several categories. 6nstead, one tends to thin# in terms of the various processes, tas#s, and ob?ects sub?ect to management.

0ranches of management theory also e5ist relating to nonprofits and to governmentA such as public administration, public management, and educational management. 1urther, management programs related to civilBsociety organizations have also spawned programs in nonprofit management and social entrepreneurship. "ote that many of the assumptions made by management have come under attac# from business ethics viewpoints, critical management studies, and antiBcorporate activism. (s one conse>uence, wor#place democracy has become both more common, and more advocated, in some places distributing all management functions among the wor#ers, each of whom ta#es on a portion of the wor#. $owever, these models predate any current political issue, and may occur more naturally than does a command hierarchy. (ll management to some degree embraces democratic principles in that in the long term wor#ers must give ma?ority support to management@ otherwise they leave to find other wor#, or go on stri#e. $ence management has started to become less based on the conceptualisation of classical military commandBandBcontrol, and more about facilitation and support of collaborative activity, utilizing principles such as those of human interaction management to deal with the comple5ities of human interaction. 6ndeed, the concept of Ebi>uitous commandBandBcontrol posits such a transformation for !1st century military management.

Management topics
Basic functions of management
Management operates through various functions, often classified as planning, organizing, leadingDmotivating and controlling.

+lanningA deciding what needs to happen in the future (today, ne5t wee#, ne5t month, ne5t year, over the ne5t 2 years, etc.) and generating plans for action.()hat to doK) OrganizingA (6mplementation) ma#ing optimum use of the resources re>uired to enable the successful carrying out of plans. &taffingA Iob (nalyzing, recruitment, and hiring individual for appropriate ?ob. 8eadingDMotivatingA e5hibiting s#ills in these areas for getting others to play an effective part in achieving plans.( o ma#e individual wor# willingly in the organization) HontrollingA monitoring BB chec#ing progress against plans, which may need modification based on feedbac#.

(ormation of the )usiness policy

he mission of the business is its most obvious purpose BB which may be, for e5ample, to ma#e soap. he vision of the business reflects its aspirations and specifies its intended direction or future destination. he o)*ectives of the business refers to the ends or activity at which a certain tas# is aimed.

he business's policy is a guide that stipulates rules, regulations and ob?ectives, and may be used in the managers' decisionBma#ing. 6t must be fle5ible and easily interpreted and understood by all employees. he business's strategy refers to the coordinated plan of action that it is going to ta#e, as well as the resources that it will use, to realize its vision and longBterm ob?ectives. 6t is a guideline to managers, stipulating how they ought to allocate and utilize the factors of production to the business's advantage. 6nitially, it could help the managers decide on what type of business they want to form.

How to implement policies and strategies

(ll policies and strategies must be discussed with all managerial personnel and staff. Managers must understand where and how they can implement their policies and strategies. ( plan of action must be devised for each department. +olicies and strategies must be reviewed regularly. Hontingency plans must be devised in case the environment changes. (ssessments of progress ought to be carried out regularly by topBlevel managers. ( good environment is re>uired within the business.

The development of policies and strategies

he missions, ob?ectives, strengths and wea#nesses of each department must be analysed to determine their roles in achieving the business's mission. he forecasting method develops a reliable picture of the business's future environment. ( planning unit must be created to ensure that all plans are consistent and that policies and strategies are aimed at achieving the same mission and ob?ectives. Hontingency plans must be developed, ?ust in case.

(ll policies must be discussed with all managerial personnel and staff that is re>uired in the e5ecution of any departmental policy. +here policies and strategies fit into the planning process

hey give midB and lowerBlevel managers a good idea of the future plans for each department. ( framewor# is created whereby plans and decisions are made. MidB and lowerBlevel management may add their own plans to the business's strategic ones.

Managerial levels and hierarchy

he management of a large organization may have three levelsA

1. &enior management (or =top management= or =upper management=) 2. Middle management 3. 8owBlevel management, such as supervisors or teamBleaders

/. 1oreman 2. Ran# and 1ile opBlevel management re>uire an e5tensive #nowledge of management roles and s#ills. hey have to be very aware of e5ternal factors such as mar#ets.

heir decisions are generally of a longBterm nature heir decisions are made using behavioralDparticipative processes analytic, directive, conceptual andDor

hey are responsible for strategic decisions. hey have to chal# out the plan and see that plan may be effective in the future. hey are e5ecutive in nature.

Middle management MidBlevel managers have a specialized understanding of certain managerial tas#s. hey are responsible for carrying out the decisions made by topBlevel management. 8ower management his level of management ensures that the decisions and plans ta#en by the other two are carried out. 8owerBlevel managers' decisions are generally shortBterm ones 1oreman D lead hand hey are people who have direct supervision over the wor#ing force in office factory, sales field or other wor#group or areas of activity. Ran# and 1ile he responsibilities of the persons belonging to this group are even more restricted and more specific than those of the foreman.

#reas and categories and implementations of management

(ccounting management (gile management (ssociation

$uman resources management $ospital management 6nformation technology

+erformance management +roduct management +ublic administration

management

management

+ublic management Muality management Records management Research management Resource management Ris# management &#ills management &ocial entrepreneurship &pend management &piritual management &trategic management &tress management &upply management chain

Hapability Management Hhange management Hommunication management Honstraint management Host management Hrisis management Hritical studies management

6nnovation management 6nterim management 6nventory management Lnowledge management 8and management 8eadership management 8ogistics management 8ifecycle management Management demand on

Hustomer relationship management Fecision ma#ing styles Fesign management Fisaster management %arned management %ducational management %nvironmental management 1acility management 1inancial management 1orecasting value

Mar#eting management Materials management Operations management Organization development +erception management +ractice management +rogram management +ro?ect management +rocess management

&ystems management alent management ime management Nisual management

Operations management
Operations management is an area of business that is concerned with the production of goods and services, and involves the responsibility of ensuring that business operations are efficient and effective. 6t is the management of resources, the distribution of goods and services to customers, and the analysis of >ueue systems.

(+6H& he (ssociation for Operations Management also defines operations management as =the field of study that focuses on the effectively planning, scheduling, use, and control of a manufacturing or service organization through the study of concepts from design engineering, industrial engineering, management information systems, >uality management, production management, inventory management, accounting, and other functions as they affect the organization=.:1; Operations also refers to the production of goods and services, the set of valueBadded activities that transform inputs into many outputs.:!; 1undamentally, these valueBadding creative activities should be aligned with mar#et opportunity (see Mar#eting) for optimal enterprise performance.

Origins
he origins of Operations Management can be traced bac# to the 6ndustrial Revolution, the same as &cientific Management and Operations Research. (dam &mith treats the topic of the division of labor when opening his 1443 masterpieceA An Inquiry into the Nature and Causes of the Wealth of Nations also commonly #nown as The Wealth of Nations. he first documented effort to solve operation management issues comes from %li )hitney bac# in 14-9, leading to the birth of the (merican &ystem of Manufacturers ((&M) by the midB 19..s. 6t was not until the late 1-2.'s that the scholars noted the importance of viewing production operations as systems.:,; :/; $istorically, the body of #nowledge stemming from industrial engineering formed the basis of the first M0( programs, and is central to operations management as used across diverse business sectors, industry, consulting and nonBprofit organizations.

Operations Management ,lanning Criteria

he tas# of production and operations management is to manage the efforts and activities of people, capital, and e>uipment resources in changing raw materials into finished goods and services.

Organi ations
he following organizations support and promote operations managementA

he (ssociation for Operations Management ((+6H&) he (ssociation for +rofessionals in 0usiness Management ((+0M) Hhartered Management 6nstitute %uropean Operations Management (ssociation (%urOM() :1;, which supports the 6nternational Iournal of Operations O +roduction Management 6nstitute for Operations Research and the Management &ciences (6"1ORM&) 6nstitute of Operations Management :!; +roduction and Operations Management &ociety (+OM&) :,;

#cademic resources

6nternational Iournal of Operations and +roduction Management, %merald. 6nternational Iournal of +roduction %conomics, %lsevier. 6nternational Iournal of &ervices and Operations Management , 6&&"A 14//B!,4., 6nderscience. Iournal of Operations Management, %lsevier. +roduction and Operations Management, +roduction and Operations Management &ociety.