unit-1.pptx introduction to management, functions

Contents
• Definition , nature and characteristics of management
(Art or science)
• Managerial functions at different organizational levels
• The functions of managers
• Evolution of management thoughts
• Fredrick Taylor and scientific management
• Contribution of Henry Fayol
• Contribution of Elton Mayo (Behavioural science)
• The emergence of human relation school

Why Study Management?
 We all have a vested interest in improving the way
organizations are managed.
 Better organizations are, in part, the result of good management.
 You will eventually either manage or be managed
 Gaining an understanding of the management process provides the
foundation for developing management skills and insight into the
behavior of individuals and the organizations.

Definition
Management is a set of activities(planning and decision
making, organizing , leading and controlling) directed at an
organization's resources (human , financial, physical and
information) with the aim of achieving organizational goals
in an efficient and effective manner. Or
“Management is an art of getting things done through and with
people in a formally organized group”.
• Management is a profession like medical, law and CA and as in
a profession we require education and qualification.

Definitions of Effectiveness and Efficiency
• Productivity implies effectiveness and efficiency
in individual and organizational performance
• Effectiveness is the achievement of objectives
• Efficiency is the achievement of the ends with
the least amount of resources (time, money, etc.)

Managerial Concerns
▫ Efficiency
 “Doing things right”
 Getting the most output for the least input
▫ Effectiveness
 “Doing the right things”
 Attaining organizational goals

Who Are Managers?
• Manager
▫ Someone who works with and through other
people by coordinating their work activities in
order to accomplish organizational goals

Types of Managers
• First-line Managers
▫ Are at the lowest level of management and manage the
work of non-managerial employees
• Middle Managers
▫ Manage the work of first-line managers
• Top Managers
▫ Are responsible for making organization-wide decisions
and establishing plans and goals that affect the entire
organization

Where Managers Work
Organization
A consciously coordinated social unit,
composed of two or more people, that
functions on a relatively continuous
basis to achieve a common goal or set
of goals.

What Is An Organization?
• An Organization Defined
▫ A systematic arrangement of people brought
together to accomplish some specific purpose;
applies to all organizations—for-profit as well
as not-for-profit organizations.
• Common Characteristics of Organizations
▫ Goal - Have a distinct purpose
▫ Structure - Have a deliberate structure
▫ People - Are composed of people

Common Characteristics of Organizations

Management Skills
Technical skills
The ability to apply specialized
knowledge or expertise.
Human skills
The ability to work with,
understand, and motivate other
people, both individually and in
groups.
Conceptual Skills
The mental ability to analyze and
diagnose complex situations.

Skills Needed at Different Management
Levels
Top
Managers
Middle
Managers
Lower-level
Managers
Importance
Conceptual
Skills
Human
Skills
Technical
Skills

What Do Managers Do? (cont’d
• Mintzberg’s Management Roles Approach
▫ Interpersonal roles
 Figurehead, leader, liaison
▫ Informational roles
 Monitor, disseminator, spokesperson
▫ Decisional roles
 Entrepreneur, disturbance handler, resource allocator,
negotiator

Mintzberg’s Managerial Roles

Mintzberg’s Managerial Roles (cont’d)

19
Management
Activities
by
organizational
size
• Small business
manager is more likely
to be a generalist.
• The structure and
formality are
characteristics of a
manager’s job in a
large organization.

20
Management Activities by Organizational Level

Features of Management
• Art as well as Science
• Management is an activity
• Management is a continuous process
• Management achieving pre-determined
objectives
• Organized activities
• Management is a factor of production
• Management as a system
• Management is a discipline

Features of Management
• Management is a distinct entity
• Management aims at maximising profit
• Management is a purposeful activity
• Management is a profession
• Universal application
• Management is getting things done
• Management is needed at all levels

Importance of Management
• Management meet the challenge of change
• Accomplishment of group goals
• Effective utilization of resources
• Effective functioning of business
• Resource Development
• Sound organization Structure
• Management directs the organization
• Integrates various interests
• Stability

Importance of Management
• Innovation
• Co-ordination and team-spirit
• Tackling problems
• A tool for Personality Development

26
Management :Science or Art ?
Elements of
Science
• Systematic body of
knowledge
• Scientific inquiry and
Observation
• Experimentation
• Universal truths
Elements of Art
• Application of Knowledge
• Doing things creatively
• Personalized skill
• Perfection through
practice

27
Management as Science
• Distinct discipline
• Offers principles & guidelines
• Social science
• An inexact science
• Scientific & systematic.

28
Management as Art
• Uses the practical knowledge acquired in tackling
problems.
• Combines human & nonhuman resources in a creative
way to achieve results.
• A personalized activity
• Constant practice leads to good management

29
Management: Science as well as Art
• Art of management is as old as civilization.
• Science of management is young and developing
• Both are complementary & mutually supportive
• Ability to solve problems requires sound knowledge & constant
practice
• According to Peter Drucker:
“Every organization has the same resources to work with. It is
the quality of management that spells the difference between
success and failure”.

30
Management as a Profession
Essential features of profession:
▫ Well defined body of knowledge
▫ Formal education and training
▫ Minimum qualification
▫ Representative body
▫ Service above self
▫ Ethical code of conduct

31
• Management has well defined body of knowledge, tools
and techniques, research & consultancy
• Acquiring management education through formal
training is possible
• No representative body unlike for doctors, lawyers, etc
• No universal code of conduct.
• No regulatory body and code of conduct leads to
neglection of service motto.

32
• Not a recognized profession ,but moving in that direction
• Some initiatives are:
▫ Separation of ownership from management
▫ State regulation of business activities
▫ Proliferation of management institutions etc.

CHARACTERISTICS
Management as a
• Goal directed activity
• Team(Co-ordination)
• Economic Resource
• Human process
• Academic discipline

Difference between Administration Vs Management
1. Nature ( thinking-doing)
2. Scope (objectives/policies-Implementation )
3. Influence (decisions are influenced by outside
forces- internal objectives/goals )
4. Usage-Govt/public undertaking-business unit)
5. Planning/control-Directing/organizing

Management Functions
• 1-Planning: Deciding what needs to happen in the future (today, next
week, next month, next year, over the next five years, etc.) and
generating plans for action.
(Vision ,Mission ,Objectives ,Goals ,Budgeting: Preparing budgets)
• 2-Organizing: (Implementation) making optimum use of the resources
required to enable the successful carrying out of plans. i.e Division of
labor ,Delegation of authority ,Departmentalization ,Coordination
3-Staffing: Job analysis, recruitment, and hiring for appropriate jobs.
4-Leading/directing: Determining what needs to be done in a situation
and getting people to do it. Motivation
5-Controlling/monitoring: Checking progress against plans. reporting:
If any deviations found, inform to the concerned authority

37
Early Management
• Management has been practiced for a long time.
Organized endeavors directed by people
responsible, leading, and controlling activities
have existed for thousands of years.
• Regardless of what these individuals were called,
someone had to perform those functions.

38
Evolution of Management (1/4)
3000 – 2500
B.C.E.
The Egyptian pyramids are
proof that projects of
tremendous scope, employing
tens of thousands of people,
were completed in ancient
times. It took more than
100,000 workers some 20 years
to construct a single pyramid.
Someone had to plan what was
to be done, organize people and
materials to do it, ensure those
workers got the work done, and
impose some controls to ensure
everything was done as planned.
That someone was the manager.

39
1400s
At the arsenal of Venice, warships were
floated along the canals, and at each stop,
materials and riggings were added to the
ship. Sounds a lot like a car “floating”
along an assembly line, doesn’t it? In
addition, the Venetians used warehouse
and inventory systems to keep track of
materials, human resource management
functions to manage the labor force and
an accounting system to keep track of
revenues and costs.

40
1780s – Mid 1800s
The Industrial Revolution may be the most
important pre-twentieth-century influence
on management. Why? Because with the
industrial age came the birth of the
corporation. With large, efficient factories
pumping out products, someone needed to
forecast demand, make sure adequate
supplies of materials were available, assign
tasks to workers, and so forth. That someone
was the manager! It was indeed a historic
event for two reasons: (1) because of all the
organizational aspects (hierarchy, control,
job specialization, and so forth) that became
a part of the way work was done, and (2)
because management had become a
necessary component to ensure the success
of the enterprise.

41
1776
Adam Smith’s Wealth of Nations argued the
economic advantages of the division of labor (or
job specialization)—breaking down jobs into
narrow, repetitive tasks. Using the division of
labor, individual productivity could be increased
dramatically.
Job specialization continues to be a popular way
to determine how work gets done in
organizations.

42
Classical Approaches
• Beginning around the turn of the twentieth
century, the discipline of management began to
evolve as a unified body of knowledge. Rules and
principles were developed that could be taught
and used in a variety of settings. These early
management proponents were called classical
theorists.

43
Classical Approaches (1/2)
1911
• That’s the year Frederick W.
Taylor’s (“father” of scientific
management) Principles of
Scientific Management was
published. It described a theory of
scientific management—the use of
scientific methods to determine the
“one best way” for a job to be done.

The emergence of management Thought
S.no Name and year of major
work
Major contribution to
management
1 Fedrick W Taylor, Shop
management (1900-1912)
Scientific management
2 Henry Fayol ( 1912-1916) Modern operational management
theory
3 Elton Mayo &F.J Roethlisberger
(19-12-1933)
Behavioural science
4 Chester Barnard (1933-1938) System theory
5 Maslow , Porter, Doughlas Mc
Gregor Peter, Drucker (1938-
1982)
Modern management thought

The scientific management
Fredrick Winslow Taylor (father of scientific
management ) , college drop out joined Midvale
company in 1885 and later became chief engineer
after obtaining engineering degree.
scientific management :Its main objective was
improving economic efficiency, especially labour
productivity. It was one of the earliest attempts to
apply science to the engineering of processes and to
management.

Contributions :
1-Replacing rule of thumb with science (Improving
productivity through work simplification and
standardisation)
2-Obtaining harmony rather
than discord in group action
3-Working for max output
rather than restricted
output
4-Achieving cooperation of
human beings rather than
chaotic individualism
5-workers incentive

Science, Not Rule of Thumb
• Managers make decisions based on their
judgments as a rule of thumb. Taylor claims that
even minor industrial activities may be
organised appropriately. This will assist in
saving both time and human energy. Decisions
must be based on scientific research that
includes cause and effect linkages.

Harmony, Not Discord
• Taylor underlined the need for total harmony
between staff and management. Any dispute
between them harms either the employees or the
management. Both management and employees
must recognize the value of the other.

Mental Revolution
• The Mental Revolution approach entails a shift in
the attitudes of staff and supervisors toward one
another. Both parties must recognize the value of
the other. Both management and employees
should strive to raise the organisation’s revenues.
Workers must make reasonable efforts to ensure
that the firm profits and management share a
portion of the earnings with the workers. As a
result, mental revolution necessitates a total shift
in both management and labour mindsets.

Cooperation, Not Individualism
• This idea, which is an outgrowth of the concept
of ‘Harmony, not Discord,’ emphasises
reciprocal collaboration between employees and
management. Cooperation, mutual trust, and a
spirit of generosity should exist among managers
and employees. The goal is to replace internal
rivalry with collaboration

Individual growth to achieve maximum efficiency and
profitability
• To a large part, the efficiency of every
organisation is determined by the talents and
competencies of its people. As a result, providing
workers with training was deemed necessary for
them to understand the best way established via
a scientific methodology. To achieve efficiency,
actions should be made, beginning with the
personnel selection process. Workers should be
chosen using scientific methods.

Taylor’s Technique of Scientific
Management
• Functional Foremanship: Taylor believed that to
improve operational activities, it is necessary to have
tactical skills, intelligence, knowledge, education,
energy, leadership, honesty, and good health. He
knew that it is difficult for an individual to possess all
these skills at a time.Therefore, he divided managerial
activities into two parts, i.e., planning and production.
Moreover, he suggested obtaining four clerks under
each in charge who hold expertise in their respective
areas so that charges are not overburdened.

• Work-study: The work-study was proposed to
analyse the details of human work and
investigate various factors like time study,
motion study, fatigue study, and method study.
• Standardisation of tools and Equipment:
Taylor suggested improving the standardisation
of tools and couplings to reduce production costs
and enhance material quality in the production
process.

• Scientific task setting: Taylor felt the need to
introduce a scientific task setting to decide a
payday’s work for a worker. Eventually, the
method can help prevent the workers from
performing functions, not in their capacity.
• The scientific setting of wage rates: Fedrick
Winslow Taylor suggested fixing workers’ wages
to produce the standard output. Therefore, he
gave an idea to introduce a different piece wage
system.

• Scientific selection and training: A
systematic selection procedure should be done
so that the organisation can get its potential
workers. It includes the employee’s selection,
training, experience, and efficiency.
• Differential piece-rate plan: The different
piece-rate plan was suggested to attract the
workers to contribute to the organisation. Taylor
suggested paying wages to the workers based on
their capability and the amount of production
done daily.

Criticism of FW.Tyalor
• It was applicable to manufacturing industry i.e
production houses.
• Trade unions opposed the idea of taking more
work from labours

Modern operational management Theory:
(Henry Fayol 14 principles)
57
Henry Fayol (father of principles of management )
mentioned Six activities of an enterprise:
1. Technical (production, manufacture, adaptation)
2. Commercial (buying, selling, exchange)
3. Financial (search for an optimum use of capital)
4. Security (protection of property and persons)
5. Accounting (Stock taking, balance sheets, cost statistics)
6. Managerial:

58
Managerial functions
• In the early part of the 20th
century, Henri Fayol (a French
industrialist) proposed that all
managers perform five
management activities: plan,
organize, command, coordinate,
and control.
• Today, these management
functions have been condensed
into four:
1. Planning
2. Organizing
3. Leading
4. Controlling

Modern operational management Theory:
(Henry Fayol’s 14 principles)
1. Division of Work – The work of every person in organisation should
be limited as far as possible to the performance of a single leading
function.
2. Authority – Managers must have the authority to give orders, but they
must also keep in mind that with authority comes responsibility.
3. Discipline – Discipline must be upheld in organizations, but methods for
doing so can vary.(clear n fair agreements)
4. Unity of Command – Employees should receive orders and be
accountable to only one boss..
5. Unity of Direction – Teams with the same objective should be working
under the direction of one manager, using one plan. This will ensure that
action is properly coordinated.
6. Subordination of Individual Interests to the General Interest – The
interests of one employee should not be allowed to become more important
than those of the group. This includes managers.

7-Remuneration – Employee satisfaction depends on fair
remuneration for everyone. This includes financial and non-financial
compensation.
8-Centralization – This principle refers to how close employees are to
the decision-making process. It is important to aim for an
appropriate balance.
9-Scalar Chain – Employees should be aware of where they stand in
the organization's hierarchy, or chain of command.
O
P
Q
R
U
V
W
S X

10-Order – The workplace facilities must be clean, tidy and safe
for employees. Everything should have its place.
11-Equity – Managers should be fair to staff at all times, both
maintaining discipline as necessary and acting with kindness
where appropriate.
12-Stability of Tenure of Personnel – Managers should strive to
minimize employee turnover. Personnel planning should be a
priority.
13-Initiative – Employees should be given the necessary level of
freedom to create and carry out plans.
14-Esprit de Corps – Organizations should strive to promote team
spirit and unity.

Comparison between F.W.Taylor and Henry Fayol
S.N
O
Basis of
comparison
Taylor Fayol
1 Perspective Shop floor level Top management
2 Focus Improving productivity
through work simplification
and standardisation
Improving overall
administration through
general principles
3 Personality Scientist Practitioner
4 Results Scientific observation and
measurement
Universal truths developed
from personal experiences
5 Major
contribution
Science of industrial
management
A systematic theory of
management

63
Behavioral Approach (1/4)
• The behavioral approach to management focused on
the actions of workers. How do you motivate and lead
employees in order to get high levels of performance?
Late 1700s – Early 1900s
• Managers get things done by working with people.
Several early management writers recognized how
important people are to an organization’s success.

64
1960s – Today
An organization’s people continue to be an
important focus of management research.
The field of study that researches the
actions (behaviors) of people at work is
called organizational behavior (OB).
OB researchers do empirical research on
human behavior in organizations. Much of
what managers do today when managing
people—motivating, leading, building trust,
working with a team, managing conflict,
and so forth—has come out of OB research.

65
1924 – Mid-1930s
• The Hawthorne studies, a series of
studies that provided new insights
into individual and group behavior,
were without question the most
important contribution to the
behavioral approach to
management. Conducted at the
Hawthorne Works of the Western
Electric Company, the studies were
initially designed as a scientific
management experiment.

Copyright: Jahn
avi Patky
66
Hawthorne studies (1924 and 1932)
Bell system
telephone
Dissatisfied workers
& Low productivity
Pension scheme
& sickness
policy
Researchers to rescue
https://www.mbaknol.com/management-concepts/4-phases-of-hawthorne-experiment-explained/#:~:text=The%20Hawthorne%20studies%20were%20conducted,each%20was%20a%20sepa
rate%20experiment
.
Phase I: Illumination Experiments
Phase II: Relay Assembly Test Room
Phase III: Interviewing Program
Phase IV: Bank Wiring Test Room
Objectives
P I: Impact of illumination on productivity
P II: Rest period & work hours on efficiency
P III: Study of social relationships & structures
P IV: Work attitudes & supervisor relationship

67
Hawthorne studies
• Conclusions:
▫ Group pressures can significantly affect individual productivity
▫ People behave differently when they’re being observed.
• Scholars generally agree that the Hawthorne
studies had a dramatic impact on management
beliefs about the role of people in organizations
and led to a new emphasis on the human
behavior factor in managing organizations.

Elton Mayo stressed the following:
• The power of natural groups, in which social aspects
take precedence over functional organizational
structures.
• The need for reciprocal communication, in which
communication is two way, from worker to chief
executive, as well as vice versa.
• The development of high quality leadership to
communicate goals and to ensure effective and
coherent decision making

)
Conclusion: Improvement in productivity was due
to such factors as morale, satisfactory
interrelationships between members of a work
group(a sense of belongings) and effective
management –a kind of managing that takes into
account human behaviour, especially group
behaviour, and serves it through such interpersonal
skills as motivating , counselling, leading and
communication .This phenomenon arising basically
from people being: noticed” has been named
Hawthorne effect.

System Theory (Chester Bernand)
Barnard viewed organizations as cooperative systems, which he defined as a
complex of physical, biological, personal and social components which are
in a specific systematic relationship by reason of the cooperation of two or
more persons for at least one definite end
• According to Barnard, an organization needs to achieve system
equilibrium. In the context of his theory, achieving equilibrium involves
two interrelated processes.
• The first process relates to the equilibrium between the organization's
characteristics and its external environment.
• The second process tries to balance the contributions that members of the
organization make to the organization's collective purpose and the degree of
satisfaction both the organization and members receive in the exchange.
• He described two ways to induce such cooperation. The first method is
called the incentive method and works by offering incentives to members
that satisfy their existing motivations, such as money. A second method,
called the persuasive method is meant to alter a member's motive.

MODERN MANAGEMENT THOUGHT
• -Peter F. Drucker (MBO)
• -Abraham H.Maslow
• -William Ouchi
• Management by objectives (MBO), is a process of
defining objectives within an organization so
that management and employees agree to the
objectives and understand what they need to do in the
organization in order to achieve them. The term
"management by objectives" was first popularized
by Peter Drucker in his 1954 book The Practice of
Management.[

• The essence of MBO is Participative Goal setting ,
choosing course of actions and decision making. An
important part of the MBO is the measurement and
the comparison of the employee’s actual
performance with the standards set. Ideally, when
employees themselves have been involved with the
goal setting and choosing the course of action to be
followed by them, they are more likely to fulfil their
responsibilities.

Social psychologist Douglas McGregor of MIT has given two contrasting theories
on human motivation and management in the 1960s:
Theory X
• This assumes that employees are naturally unmotivated and dislike working,
and this encourages an authoritarian style of management. According to this
view, management must actively intervene to get things done.
This style of management assumes that workers:
• Dislike working.
• Avoid responsibility and need to be directed.
• Have to be controlled, forced, and threatened to deliver what's needed.
• Need to be supervised at every step, with controls put in place.
• Need to be enticed to produce results; otherwise they have no ambition or
incentive to work.
McGregor recognized that X-Type workers are in fact usually the minority,
and yet in mass organizations, such as large scale production environment,
X Theory management may be required and can be unavoidable.

Theory Y
• This theory states about participative style of
management that is de-centralized. It assumes that
employees are happy to work, are self-motivated and
creative, and enjoy working with greater
responsibility. It assumes that workers:
• Take responsibility and are motivated to fulfil the
goals they are given.
• Seek and accept responsibility and do not need much
direction.
• Consider work as a natural part of life and solve work
problems imaginatively

Theory Z
Theory Z of Ouchi is Dr. William Ouchi's so-called "Japanese
Management" style popularized during the Asian economic boom of the
1980s. According to him, the benefits of using Theory Z include
reducing employee turnover, increasing commitment, improving morale
and job satisfaction, and drastically increasing productivity.
• To realize these benefits, he argued that an organization should have the
following:
• A Strong Company Philosophy and Culture: The company
philosophy and culture needs to be understood and embodied by all
employees, and employees need to believe in the work they're doing.
• Long-Term Staff Development and Employment: The organization
and management team has measures and programs in place to develop
employees. Employment is usually long-term, and promotion is steady
and measured. This leads to loyalty from team members.
• Consensus in Decisions: Employees are encouraged and expected to
take part in organizational decisions.

• Concern for the Happiness and Well-Being of
Workers: The organization shows sincere concern for
the health and happiness of its employees, and for their
families. It puts measures and programs in place to help
foster this happiness and well-being.
• Informal Control with Formalized
Measures: Employees are empowered to perform tasks
the way they see fit, and management is quite "hands
off." However, there should be formalized measures in
place to assess work quality and performance.
• Individual Responsibility: The organization
recognizes the contributions of individuals, but always
within the context of the team as a whole.

78
Management Activities by type: profit or non-
profit
• Does a manager who works for the ‘Nanhi Kali’ or
‘Smile Foundation’ do the same things a manager at
Amazon or TCS does?
• Profit (bottom line) is an unambiguous measure of a
business organization’s effectiveness.
• Not-for-profit organizations don’t have such a
universal measure, making performance measurement
more difficult. But don’t interpret this difference to
mean that managers in those organizations can ignore
the financial side of their operations.

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