What management is

During the 1990’s, there was a so-called ‘cutting–edge’ management

thinking where writers, publishers month in and month out announced
the discovery of “ground breaking” new ideas. It was said to be the
decade of the buzz. The buzz was summed up in four words.” This time
its different.
To deal with change is management’s most difficult task .but dealing
effectively with change requires a clear understanding of what does not
change. This is a book that gives fundamental knowledge of what
management is, its various disciplines and management ideas that have
stood the test of time.

“A group of people get together and exist as an institution that we call a

company so they are able to accomplish something collectively that
they could not accomplish separately-they make a contribution to
society, a phrase which sounds trite but is fundamental.”

-David Packard
Co-founder
of Hewlett and Packard

Value creation: From the outside in

“ Price is what you pay. Value is what you get”.

-Warr
en Buffet

Value creation has been considered as a chief responsibility in modern

management. Value creation specifies creating value of a company or its
product in the eyes of the customers. This is only achieved by satisfying
the customers wants and desires. Value also serves as an efficiency as
considering example of George Eastman , in 1888, George Eastman
introduced Kodak camera at $25, he sold only 13,000. But in 1900, he
introduced a simpler, cheaper $1 Brownie, he sold 1,50,000 cameras in
the first year alone. Thus creating value for its product in the market.
One has to look through the customer’s eye, from the outside in. It also
emphasize on the concept of Scientific Management-given by F.W.
Taylor who’s message explains:-However simple a task may seem , you
need to study it systematically to determine the “one best way” to do it.
Value creation includes the industrial era’s focus on efficiency as well as
the consumer era’s focus on customer, quality and choice.

Covering insights to enterprise

“Business model” is one of those terms of art that were central to the
internet boom; it glorified all manner of half-baked plans. All it really
meant was how you planned to make money.

-Michael Lewis

The new, new thing

A business model is a set of assumptions about an organization will

perform by creating value for all its players. The “Business model” for
Microsoft , for instance was to sell software for 120 bucks that cost 50
cents to manufacturers. The “Business model” for internet companies
for example ebay was to attract large number of people to their website
and then sell others the chance to advertise their products to the
people. Considering one of the best business model stories of the past
two decades, DELL. What DELL did it worked on the existing value chain
of the product and cut one unnecessary step out of the process i.e. the
middle man in order to reach and serve its customers directly.
Thus, Business model reflect system thinking that is central to the
management.

Strategy: The logic of superior performance

 “The essence of strategy is choosing what not to do”
-Mic
hael .E. Porter

Strategy is the key element in the proper functioning of any organization

. As it becomes mandatory for organizations to have a strong strategy
for the execution of a plan. To do things better by being different is a
strategical step followed by many companies for example WalMart of
Sam Walton , which in its initial days concentrated its setup in local
areas rather targeting the metropolitan areas which were already
dominated by other existing players in the market. Sam own words,”
was to put good-sized stores into little one –horse towns which
everybody else was ignoring.

Organisation: Where to draw the lines

“We trained hard….but every time we were beginning to form into

teams, we would be reorganized. I was to learn later in life that we tend
to meet new situations by reorganizing and a wonderful method it can
be for creating the illusion of progress while producing confusion,
inefficiency and demoralization”
-Petronius
Arbiter
Satyricon(
1st century A.D)

Focusing the point on wave of mergers and acquisitions in the history of

business for example GE under Jack Welch’s leadership, bought
hundreds of other companies. Cisco systems, one of the great success
stories of the post-pc era, has such a voracious ability for companies
that being acquired by Cisco became the dream of many companies.
But still there are organizational lines which are drawn. Management’s
job, requires to draw three different kinds of lines. First, the boundary
lines, which separate what’s inside and what’s outside. Second, the lines
of the organizational chart, which map how the company is divided into
different sectors and how all sectors are interrelated. Third, lines of
authority i.e. who decides what and how everybody works accordingly
for example Ford and GM . Ford under the leadership of Henry Ford in
the beginning years concentrated in the production of its T-model and
implementing centralization, while Sloan’s GM concentrated on division
of work into different units and implementing decentralization i.e. with
coordination and cooperation with the employees. Thus, GM could
dominate the auto-mobile sector by making cars for every purse and
purpose.

Delivering results: Management last task

“Results are obtained by exploiting opportunities, not by solving

problems”

-Peter .F. Drucker

Thus, this is the goal of the book- to present a coherent view of the
whole, of the work known as general management. Thus, explaining the
why of both the theory and practice of management.

RECOMMENDATIONS:-

This book presents a fundamental concept of general management.

Further, various disciplines of management i.e. innovations, scientific
management have been explained with examples from the real business
world dated to the time when innovators like George Eastman started
implementing management in practice to the present business scenario
of Microsoft, ebay and other business models. Thus, it’s a book which is
must read by the students of management to get a lucid picture of what
management is and how it works