Management Concept

Management
“Management is knowing exactly what you want men to do, and then seeing that they do it the best and
cheapest way.” –F. W. Taylor.
“Management is to forecast and to plan, to organise, to command, to co-ordinate and to control.” – Henry
Fayol
 Management may be labelled as the art of getting work done through people with satisfaction for
employer, employee and the public.
 For getting the work done (of an enterprise) through the effort of other people, it is necessary to guide,
direct, coordinate and control human efforts for the fulfilment of the goal of the enterprise.
 Management is an executive function which actively directs human efforts towards common goals.
 The goals of the enterprise are fulfilled through the use of resources like men, money, materials and
machines.
 Planning, organising, staffing, directing, motivation, coordination and control are all functions of
management.
 Management may be called an Art as well as a Science.
a) Art means the practical application of the knowledge and skills as per the need of the situation
to achieve desired results. Management is an art because it involves creating results through
practical application of knowledge and skills. The main features of art are as follows:
 Practical knowledge
 Personal skill
 Situational
 Personal judgement
 Creativity/ Result oriented approach
 Improvement through continuous practice.
b) Science means a systematic body of knowledge pertaining to a specific field of study. It contains
general principles and facts which explain a phenomenon. These principles establish cause and
effect relationship between two or more factors. The principles of science have universal
application and validity.
Management is a systematic body of knowledge consisting of general principles and techniques.
Management principles are based on scientific enquiry and investigations. The principles of
management establish cause and effect relationship between different variables. Principles of
management are universal and valid.

Levels of Management
1) Top Management
2) Middle Management
3) Lower/ Supervisory Management

1) TopManagement
 Top management includes- board of directors, managing directors, chief executives, general
managers, owners, shareholders.
 Top management functions are-

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Management Concept
a) Setting basic goals and objectives.
b) Expanding or contracting activities.
c) Establishing policies.
d) Monitoring performance.
e) Designing organisation system.
f) Shouldering financial responsibilities.
2) Middle Management
 Middle management includes- sales manager, production manager, finance manager, accounts
manager, R&D manager etc.
 Middle management functions are-
a) Designing operating policies and routines.
b) Assigning duties to their subordinates.
c) To supervise
d) To co-ordinate
e) To exercise control over lower level management
f) Selection of the staff for lower level management.
3) Lower Level or Supervisory Level Management
 Lower management includes- foreman, supervisor, superintendent, inspector etc.
 Lower Management functions are-
a) Direct supervision of workers and their work.
b) Developing and improving work methods.
c) Giving instructions to workers
d) To act as a link between top management and the workers.

Functions of Management
Management functions refer to the activities which managers perform to determine and
achieve the desired objectives. There is no universally accepted list of management
functions. Various experts have classified the functions of management in different ways.
Management functions are as follows:
1. Planning
2. Organising
3. Staffing
4. Directing
5. Controlling
6. Co-ordinating
1. Planning- Planning is the most basic of all management functions. Planning means thinking
before doing. Every manager plans no matter at what level he operates. It is a function to
decide about what, where, when, who, why and how a particular activity should be done.
The process of planning consists of the following steps.
a) Establishing objectives.
b) Forecasting to assist planning
c) Identifying the alternative courses of actions.
d) Evaluation of each course of action.
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Management Concept
e) Selecting a best course of action.
2. Organising- Organising is the process by which the structure and allocation of job is
determined.
 The process of organising involve the following steps:
a) Identifying the activities necessary to achieve the objectives.
b) Grouping similar activities into manageable units.
c) Assigning duties or tasks to appropriate individuals.
d) Delegating necessary authority to individuals and fixing responsibilities for results.
e) Defining authority- responsibility relationships among individuals.
 Organising means, organising people, materials, jobs, time etc., and establishing a
framework in which responsibilities are defined and authorities are laid down.
3. Staffing- Staffing involves filling the positions needed in the organisation structure by
appointing competent and qualified persons for the job.
 Staffing consists of the following activities:
a) Manpower planning i.e. determining the number and quality of employees required
in the organisation.
b) Recruitment, selection and placement of right persons.
c) Training and development to improve their capabilities.
d) Appraisal, promotion and transfer of employees.
e) Employee remuneration and incentives.
4. Directing- Directing is telling people what to do and seeing that they do it to the best of
their ability.
 Directing involves motivating, guiding and supervising subordinates towards company
objectives.
 Directing thus includes:
a) Giving instructions to subordinates.
b) Guiding the subordinates to do the work.
c) Supervising the subordinates to make certain that the work done by them is as per
the plan established.

 Principles of Direction
a) Harmony of objectives
b) Unity of command
c) Direct supervision
d) Effective communication
e) Effective leadership
 Directing involves functions such as:
(a) Leadership, (b) Communication, (c) Motivation, and (d) Supervision.
 Leadership is the quality of the behaviour of the managers whereby they inspire confidence
and trust in their subordinates, get maximum co-operation from them and guide their
activities in organised effort.
 Communication is the process by which ideas are transmitted, received and understood by
others. Communication may be verbal or written orders, reports, instructions, etc.
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Management Concept
 Motivation means inspiring the subordinates to do a work or to achieve company’s
objectives effectively and efficiently.
 Supervision is necessary in order to ensure, (i) that the work is going on as per the plan
established, and (ii) that the workers are doing as they are instructed to do.
5. Co-ordinating- An organisation consists of several persons, each of them performing a
specialised job. Therefore it becomes necessary to create harmony between different
individuals and tasks. Common action can be obtained only when dissimilar things and
people are properly integrated together. Such synchronisation of the specialised activities
and efforts of members of a group for the accomplishment of the group objectives is known
as co-ordination.
 Co-ordination is the orderly arrangement of group efforts to provide unity of action in the
pursuit of common goal. It involves unifying, integrating and harmonising the activities of
different departments and individuals for the achievement of common objectives.
6. Controlling- Controlling is a continuous process of measuring actual results in relation to
those planned.
 Controlling is that managerial activity whereby the managers compare actual performance
against the planned one, find out the deviation, and take corrective actions.
 Controlling is a process which sets standards, measures job performance, and takes corrective
actions, if required.
 The control process have the following steps:
a) Establishment of standards
b) Measurement of performance
c) Comparing the activity with the standards
d) Remedial action

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Management Concept

Span of control
Span of control refers to the number of subordinates that directly report to an executive or the number
of subordinates that an executive can supervise directly.
 No single executive should have more subordinates looking to him for controlling and guidance than he
can reasonably manage; because
a) the executive has limited time available for his activities, and
b) he has limited available energy.
 The number of persons which can be effectively supervised by a single executive or departmental head
should be limited to six in an average firm; however when the activities are routine or closely related
the manager can direct and supervise a large number up to 20.
 If the span is small, an executive may tend to over supervise and may do even spoon feeding to his
subordinates. On the other hand if the span is large, the executive may not be able to supervise his
subordinates efficiently and they may become careless or they may feel neglected.
 Factors determining the span of control are:
a) Capacity, experience and skill of the subordinate.
b) Capacity and skill of the executive.
c) For specialised and routine work span of control can be large.
d) Complex nature of work demands a small span of control.
e) A small span of control is also ideal when the workers are doing different type of work and
require close supervision and control.
f) A wide span of control can be employed if the objective, plans and policies are clear and
definite but where policies and responsibilities are not clear officers need more time for giving
the clarifications to their subordinates and will require more time. Hence in such cases span of
control is required to be kept smaller.

Division of Labour
It means division of work into different parts or processes which are performed by one or group of
workers according to their ability and aptitude. A good example of division of labour is found in mass
scale production factory, where workers are classified according to the nature of work performed by
them, e.g. foreman, Technician, Electrician etc.
Division of labour is of four kinds:
a) Simple division of labour: Where there is complete division of jobs among different members of a
community, it is called simple division of labour.
b) Complex division of labour: In complex division of labour, the work is divided into a number of
processes in such a way that each worker does one process only.
c) Territorial division of labour: When due to one reason or the other a particular area specialises in a
type labour, we call it territorial division of labour.
d) International division of labour: When different countries produce things of their specialisation, we
call it international division of labour.

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Management Concept

Delegation of Authority
A manager, no matter how capable he is, cannot manage to do every task on his own. Thus, he
must delegate authority. Delegation refers to the downward transfer of authority from a superior
to a subordinate. It is a pre-requisite to the efficient functioning of an organisation because it
enables a manager to use his time on high priority activities. It also satisfies the subordinate’s need
for recognition and provides them with opportunities to develop and exercise initiative. However,
delegation does not mean abdication. The manager shall still be accountable for the performance
of the assigned tasks.
Elements of Delegation: According to Louis Allen, delegation is the entrustment of responsibility
and authority to another and the creation of accountability for performance. A detailed analysis of
Louis Allen’s definition brings to light the following essential elements of delegation:
(i) Authority: The term authority implies the sum of rights and powers of a person to make
decisions, to issue orders, to use organisational resources and to hire and fire employees. It is the
sum of rights and powers entrusted to a person to enable him to perform the assigned tasks.
Authority flows from top to bottom, i.e., the superior has authority over the subordinate.
(ii) Responsibility: Responsibility is the obligation of a subordinate to properly perform the
assigned duty. It arises from a superior–subordinate relationship because the subordinate is bound
to perform the duty assigned to him by his superior. Thus, responsibility flows upwards i.e., a
subordinate will always be responsible to his superior.
An important consideration to be kept in view with respect to both authority and responsibility is
that when an employee is given responsibility for a job he must also be given the degree of
authority necessary to carry it out.
(iii) Accountability: Delegation of authority undoubtedly empowers an employee to act for his
superior but the superior would still be accountable for the outcome. Accountability implies being
answerable for the final outcome.
Once authority has been delegated and responsibility accepted, one cannot deny accountability. It
cannot be delegated and flows upwards i.e., a subordinate will be accountable to a superior for
satisfactory performance of work. It indicates that the manger has to ensure the proper discharge
of duties by his subordinates. It is generally enforced through regular feedback on the extent of
work accomplished.