Introduction to Management

Management is the process of achieving objectives through the use of various resources. Good
management needs to be both effective and efficient.
There are four basic types of resources that management utilises:
Human resources (people)
Physical resources (materials and equipment)
Financial resources (money)
Information
The skills and competencies required to be a good manager are generally different to those
required to perform the work being managed, although a minimum understanding of the work is
still required.
Effectiveness is the degree to which a task or activity achieves its intended purpose. This is
essentially about doing the right thing.
Efficiency is the degree to which a task or activity is accomplished with the least amount of
effort, ie ensuring that scarce resources are not wasted. This is essentially about doing things the
right way. Measures of efficiency include the amount (usually measured in cost) of various
inputs, return on capital invested, and level of resource utilisation. Productivity is a measure of
efficiency and is the ratio of an activitys outputs to its inputs.

Engineers and Management

Engineers usually start their careers in purely technical roles such as designing engineering
systems or deciding how to implement a task or project. As they move up the career ladder
engineers progressively take on more managerial responsibility. Thus it is important that
engineers understand management.

The Nature of Managerial Work

Management is a complex and dynamic combination of science (systematic techniques) and art
(experience, intuition and common sense). It depends to a large extent on individual personality,
instinct and motivation, but also may involve the use of quantitative techniques.

Social Process
Management involves getting things done through people, thus it is a social process. Peoples
personalities, attitudes, perceptions, motivations, expectations and experience affect their
individual reactions to different management actions. Thus peoples response may not be as
expected. People may simply carry out instructions, resist them, or embrace them and exceed
expectations.
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Scientific Process
Management is also a scientific process in which logical, objective and systematic approaches are
used to support decision making and problem solving. Mathematical models of many
management problems can be formulated by identifying and quantifying objectives and
constraints. These can be used for planning, and later on for evaluating performance.

Economic Process
A basic management task is to allocate scarce resources to achieve certain future benefits.
Therefore economic resources such as labour, raw materials and capital equipment are utilised in
the production of goods and services.

Management Functions
Planning
Planning involves setting goals and determining the best strategy for achieving those goals. It is
commonly referred to as the primary management function because the plan produced provides
the basis of all of the other functions.
Planning is typically categorized as strategic planning or operational planning. Strategic
planning is usually performed by senior management, has a long time horizon, and focuses on
setting the goals and direction of the organization. Operational planning has a shorter time
horizon and focuses on determining the best way to achieve the goals set by senior management
and on deciding how to perform specific work. It is usually performed by middle and lower level
managers.
Organising
The organising function involves assigning resources to tasks (or tasks to resources). It also
involves setting up the proper work relationships between people working on allocated tasks (ie
how tasks are to be grouped, who reports to whom, and at what level decisions are made).
Organising also involves considering issues related to organisational structure such as span of
control (the number of people directly supervised by a manager or supervisor), chain of command
(supervisor-subordinate relationships), and division of labour (assignment of responsibility).
Properly performing the organising function helps to ensure that human resources are efficiently
utilised within the organisation.
Leading
Leading involves influencing other people to achieve organizational goals. When managers lead
they motivate people to produce results and work together towards established objectives.

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Controlling
Activities do not always proceed according to plan. The controlling function involves monitoring
work performance and comparing actual results to previously set goals. Where a significant
discrepancy exists corrective action is taken to get work performance back on track to meet
objectives. This process of monitoring and controlling is also called supervising.
The corrective action adopted may involve ensuring the availability of resources (reorganizing),
changing the original plan, or modifying the original objectives.

Management Roles
Henry Mintzberg identified 10 different roles that managers play within organizations, which he
grouped into three categories:
Role
Interpersonal
Figurehead
roles
Leader
Liaison
Informational
roles

Monitor
Disseminator
Spokesperson

Decisional roles

Entrepreneur
Disturbance
handler
Resource
allocator
Negotiator

Examples
Representing the organisation at a ceremony, receiving
visitors
Motivating, counselling and supporting subordinates
Coordinating activities of different work units, representing
the organisation on committees
Looking for an obtaining valuable up-to-date information
Transmitting information to staff within the work unit who
need it
Relaying information about the organisation to outside
parties
Designing and initiating new activities within the
organisation
Dealing with crises, resolving conflict between staff
Developing budgets, schedules, and responsibilities
Bargaining with other people, organisations or work units

Management Skills
Robert Katz identified three groups of skills that managers need: technical, interpersonal and
conceptual skills.
Technical Skills
Technical skills comprise the knowledge required to carry out the specific type of work that the
organisation does. It includes the ability to apply the relevant methods, techniques, equipment
applicable to the managers area of responsibility in the organisation (eg engineering, sales, or
accounting).
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Technical skills are particularly important at the lower levels in the management hierarchy such
as first line managers, who are actively supervising the people actually doing the work.
However, even senior managers need some level of proficiency in order to be effective. For
example a senior manager of a construction company with a Civil Engineering background will
use that experience in making strategic decisions about what type of project the company should
be seeking out.
Interpersonal Skills
Interpersonal skills comprise an individuals abilities to relate to others. Managers with good
interpersonal skills inspire enthusiasm and trust among their staff, and thus are able to get the
best out of them. Interpersonal skills are important at all levels of management because all
managers work directly with people.
Conceptual Skills
Conceptual skills represent the ability to conceptualise and think abstractly. Managers apply
their conceptual skills to visualise the structure of the organisation, understand the relationships
between the various subunits, and understand how the organisation fits into its broader
environment. Conceptual skills are essential for problem solving because they enable a person to
comprehend the nature of a problem before attempting to develop an appropriate solution.

Levels of Managers
Senior Managers
Senior managers are responsible for establishing the organisations goals, policies and strategies,
and managing the overall performance of the organisation as a whole.
Middle Managers
Middle managers implement the policies and strategies that upper management has established,
and supervise and coordinate the first line level managers.
First Line Managers
First line managers are responsible for supervising and coordinating the activities of small work
groups of non-managerial employees. These managers will spend much more of their time than
the other levels supervising subordinate workers.

Types of Managers

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Line Managers
Line managers are managers whose position in the hierarchy places them directly above
employees who directly contribute to the outputs of an organisation. For example the production
managers in a manufacturing company.
Staff Managers
Staff managers are managers whose job is to advise the line managers and support their work.
This would include management staff in the human resources and finance departments.

Management Theories
Classical Theories
The earliest management theories were developed in the early twentieth century and sought to
determine the general principles governing all management situations. They provided insights
that are still used today. The two main groups within the classical school of thought were
scientific management, which focussed on individual employee productivity, and administrative
management, which tried to improve the overall organisations effectiveness and efficiency.
A major limitation of the classical theories was their prescription of universal procedures, which
is now considered simplistic as different situations may require different approaches.
Scientific Management
The father of the scientific management school of thought is Frederick Taylor, who was an
engineer working in a steel mill. Taylor observed that different workers had different methods
for carrying out work. He saw the role of managers as being to determine the most efficient way
of doing a piece of work and then ensuring that all workers did it that way all the time. He also
promoted the use of financial incentives to get workers to work faster.
Frank and Lillian Gilbraith also made significant contributions to scientific management. In
particular they developed the motion study, the science of reducing a task or job to its basic
physical motions, as a way to improve productivity. In order to analyse their motion studies they
developed the flow process chart, which shows all of the movements and makes it easier to look
for places to look for improvement.
Administrative Management
The major contributor to the administrative school of thought was Henry Fayol. He identified six
key activities for all organisations, five functions of management activities, and fourteen
principles for managing an organisation.

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Key activity
Technical
Commercial
Financial
Security
Accounting
Management

Example
Production
Buying resources and selling products
Obtaining capital
Taking care of property
Keeping financial records
See below

Management Functions:
Planning looking to the future and developing strategies to meet the organisations goals
Organising setting up the organisational structures
Commanding giving instructions and making sure that they are carried out
Co-ordinating harmonising organisational activities
Controlling ensuring that actual performance is in line with planned performance, and
taking corrective action if necessary
Management Principle
Division of work
Authority
Discipline
Unity of command
Unity of direction
Subordination of individual interest to general
interest
Fair remuneration
Centralisation
Scalar chain of command
Order
Equity
Stability of tenure of personnel
Initiative

Esprit de corps

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Meaning
Specialisation of task to enable expertise to be
developed in a narrow area
The right to give commands, with requisite
responsibility
Managers should command (and get) respect
Each employee has only one superior to receive
orders from and report to
Only one manager and one plan for each group
of activities having the same objective
No group should deviate from the interests of
the organisation
For both employee and firm
A central system for direction and coordination
Clear line of authority from top to bottom
Everything and everybody should be in the
most appropriate place
Management should be fair in its dealings with
employees
Employees should noy feel that their positions
are under threat
Managers should encourage employees to use
their initiative within the limits of authority and
discipline
Management should build up team spirit and
morale

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Behavioural Management Theories

Behavioural management theories attempt to look at the person as a person rather than as a
machine. They tried to find the psychological motivations of people.
Hawthorne Studies
The Hawthorn studies were conducted by Elton Mayo in the USA. He was trying to determine
the influence of the level of illumination on productivity. Strangely both increasing and
decreasing light levels increased productivity. After a umber of different experiments involving
other physical changes he concluded that social factors were important in employees
productivity. In particular productivity can be increased is higher when there exists a group
atmosphere, where workers have pleasant relations with each other, and participative supervision,
where employees opinions are regularly sought, thus making the workers feel important.
Another important discovery of these studies was the Hawthorne effect, which is the tendency of
people singled out for attention to perform as expected in the situation, and perhaps differently to
normal.
Maslows Hierarch of Needs
Abraham Maslow developed a hierarchy of needs theory of motivation giving the following five
levels of needs:
Physiological needs: survival and basic biological functioning, such as food an physical
well being
Security needs: physical and emotional security and stability, such as housing, safety, and
a secure job
Belongingness needs: love, affection and acceptance by ones peers
Esteem needs: respect and recognition from others, also self esteem
Self-actualisation needs: self fulfilment in realising ones potential for growth and
individual development, and being able to use ones abilities to the fullest extent possible
Maslows theory is based on two principles. The deficit principle states that people act to satisfy
needs for which they have a deficit. Therefore a need no longer motivates when it is already
satisfied. The progression principle states that the five needs for a hierarchy and that a need at
any level only becomes activated when lower level needs are met. A person wont care about
recognition when they are starving or dont have anywhere to live. The self actualisation need is
special in that it becomes stronger the more it is satisfied.

Systems Approach
A system is a collection of interdependent components that function together to achieve a goal.
The relationships between the components are as important as the properties of the individual
components. The systems theory of management recognises that organisations operate according
to systems principles, both in the way the subsystems of the organisations interact and the way
that the organisation interacts with its environment.
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Inputs, Outputs and Feedback Loops

Organisations can be considered to be devices that turn inputs (people, plant, materials, capital,
etc) into outputs (goods and services). Feedback loops are necessary to ensure that the
organisation performs as it should. Also managers need to understand the potential of feedback
loops that they did not create also having an effect on output (for example the reaction of
employees to various decisions.
Synergy
Synergy represents a harmony of forces that occurs when two or more inter-dependent subsystems work together to produce more than the total of what the individual sub-systems could
produce on their own. This emphasizes cooperation between departments etc.
Entropy
Entropy is a natural process of system decline and must be actively worked against. This
requires that the organization monitors feedback from its environment and responds to change
appropriately.

Contingency Approach
The contingency approach to management advocates that there is no one best way to manage.
Instead the appropriate approach in any given circumstance depends on the situation.

Reference
Faniran, O (2005) Engineering Project Management: An Introductory Text, Pearson Education
Australia, Sydney

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