Management is the process of reaching organizational goals by working with and through people and other organizational resources.
Management has the following 3 characteristics:
- It is a process or series of continuing and related activities.
- It involves and concentrates on reaching organizational goals.
- It reaches these goals by working with and through people and other organizational resources.
The 4 basic management functions that make up the management process are described in the following sections:
PLANNING: Planning involves choosing tasks that must be performed to attain organizational goals, outlining how the tasks must be performed, and indicating when they should be performed.
Planning activity focuses on attaining goals. Managers outline exactly what organizations should do to be successful. Planning is concerned with the success of the organization in the short term as well as in the long term.
Organizing can be thought of as assigning the tasks developed in the planning stages, to various individuals or groups within the organization. Organizing is to create a mechanism to put plans into action.
People within the organization are given work assignments that contribute to the company’s goals. Tasks are organized so that the output of each individual contributes to the success of departments, which, in turn, contributes to the success of divisions, which ultimately contributes to the success of the organization.
Influencing is also referred to as motivating,leading or directing.Influencing can be defined as guiding the activities of organization members in he direction that helps the organization move towards the fulfillment of the goals.
The purpose of influencing is to increase productivity. Human-oriented work situations usually generate higher levels of production over the long term than do task oriented work situations because people find the latter type distasteful.
Controlling is the following roles played by the manager:
- Gather information that measures performance
- Compare present performance to pre established performance norms.
- Determine the next action plan and modifications for meeting the desired performance parameters.
The 14 Management Principles from Henri Fayol (1841-1925) are:
1. Division of Work. Specialization allows the individual to build up experience, and to continuously improve his skills. Thereby he can be more productive.
2. Authority. The right to issue commands, along with which must go the balanced responsibility for its function.
3. Discipline. Employees must obey, but this is two-sided: employees will only obey orders if management play their part by providing good leadership.
4. Unity of Command. Each worker should have only one boss with no other conflicting lines of command.
5. Unity of Direction. People engaged in the same kind of activities must have the same objectives in a single plan. This is essential to ensure unity and coordination in the enterprise. Unity of command does not exist without unity of direction but does not necessarily flows from it.
6. Subordination of individual interest (to the general interest). Management must see that the goals of the firms are always paramount.
7. Remuneration. Payment is an important motivator although by analyzing a number of possibilities, Fayol points out that there is no such thing as a perfect system.
8. Centralization (or Decentralization). This is a matter of degree depending on the condition of the business and the quality of its personnel.
9. Scalar chain (Line of Authority). A hierarchy is necessary for unity of direction. But lateral communication is also fundamental, as long as superiors know that such communication is taking place. Scalar chain refers to the number of levels in the hierarchy from the ultimate authority to the lowest level in the organization. It should not be over-stretched and consist of too-many levels.
10. Order. Both material order and social order are necessary. The former minimizes lost time and useless handling of materials. The latter is achieved through organization and selection.
11.Equity. In running a business a „combination of kindliness and justice‟ is needed. Treating employees well is important to achieve equity.
12. Stability of Tenure of Personnel. Employees work better if job security and career progress are assured to them. An insecure tenure and a high rate of employee turnover will affect the organization adversely.
13. Initiative. Allowing all personnel to show their initiative in some way is a source of strength for the organization. Even though it may well involve a sacrifice of „personal vanity‟ on the part of many managers.
14.Esprit de Corps. Management must foster the morale of its employees. He further suggests that: “real talent is needed to coordinate effort, encourage keenness, use each person‟s abilities, and reward each one‟s merit without arousing possible jealousies and disturbing harmonious relations.”
1)Top Level of Management
The Top Level Management consists of the Board of Directors (BOD) and the Chief Executive Officer (CEO). The Chief Executive Officer is also called General Manager (GM) or Managing Director (MD) or President. The Board of Directors are the representatives of the Shareholders, i.e. they are selected by the Shareholders of the company. Similarly, the Chief Executive Officer is selected by the Board of Directors of an organisation. The main role of the top level management is summarized as follows :-
- The top level management determines the objectives, policies and plans of the organisation.
- They mobilises (assemble and bring together) available resources.
- The top level management does mostly the work of thinking, planning and deciding. Therefore, they are also called as the Administrators and the Brain of the organisation.
- They spend more time in planning and organising.
- They prepare long-term plans of the organisation which are generally made for 5 to 20 years.
- The top level management has maximum authority and responsibility. They are the top or final authority in the organisation. They are directly responsible to the Shareholders, Government and the General Public. The success or failure of the organisation largely depends on their efficiency and decision making.
- They require more conceptual skills and less technical Skills.
2)Middle Level of Management
The Middle Level Management consists of the Departmental Heads (HOD), Branch Managers, and the Junior Executives. The Departmental heads are Finance Managers, Purchase Managers, etc. The Branch Managers are the head of a branch or local unit. The Junior Executives are Assistant Finance Managers, Assistant Purchase Managers, etc. The Middle level Management is selected by the Top Level Management. The middle level management emphasize more on following tasks :-
- Middle level management gives recommendations (advice) to the top level management.
- It executes (implements) the policies and plans which are made by the top level management.
- It co-ordinate the activities of all the departments.
- They also have to communicate with the top level Management and the lower level management.
- They spend more time in co-ordinating and communicating.
- They prepare short-term plans of their departments which are generally made for 1 to 5 years.
- The middle Level Management has limited authority and responsibility. They are intermediary between top and lower management. They are directly responsible to the chief executive officer and board of directors.
- Require more managerial and technical skills and less conceptual skills.
3)Lower Level of Management
The lower level management consists of the Foremen and the Supervisors. They are selected by the middle level management. It is also called Operative / Supervisory level or First Line of Management. The lower level management performs following activities :-
- Lower level management directs the workers / employees.
- They develops morale in the workers.
- It maintains a link between workers and the middle level management.
- The lower level management informs the workers about the decisions which are taken by the management. They also inform the management about the performance, difficulties, feelings, demands, etc., of the workers.
- They spend more time in directing and controlling.
- The lower level managers make daily, weekly and monthly plans.
- They have limited authority but important responsibility of getting the work done from the workers. They regularly report and are directly responsible to the middle level management.
- Along with the experience and basic management skills, they also require more technical and communication skills.
Henry Mintzberg’s Managerial Roles
There are many roles a manager has within an organization. Performing these roles is the basis of a manager’s job. To be effective at these roles, a manger must be a complete businessperson by understanding the strategic, tactical and operational responsibilities he or she holds. While not always explicitly stated in a manager’s job description, at any given moment a manager might have to be a coach, a strategic planner, a liaison, a cheerleader, a conflict manager, a realist, a problem-solver, an organizer, an optimist, a trainer and a decision-maker. These roles can change from day to day, but one thing is for sure: a manager must understand all of his or her roles and how to perform them effectively. This means that a manager must have a global understanding of all business functions, organizational goals, his or her level of accountability and the appropriate way to serve both internal and external clients of the organization.
Henry Mintzberg spent much of his career researching the managerial roles and behaviors of several chief executive officers, or CEOs. Mintzberg discovered that managers spent most of their time engaging in ten specific roles. He was able to then classify these roles into three categories, including interpersonal, informational and decisional roles. To better understand these roles, let’s look at how they are applied by Bernard the Boss as he goes through his daily routine as a manager at a local grocery store.
The first category of roles described by Mintzberg is called interpersonal roles. These roles involve the behaviors associated with human interaction. In other words, interpersonal roles are those roles that allow a manager to interact with his or her employees for the purpose of achieving organizational goals. There are three roles listed under interpersonal roles, which include figurehead, leader and liaison. Let’s look at how these three roles are played out by Bernard.
When Bernard arrives at the store in the morning, he holds a daily meeting for all employees who are working that day. He spends time talking about daily specials and sales goals and motivates his employees for the day by holding a friendly contest between the workers to try to sell as many of the sale items as possible during their shift. He informs his employees that the highest seller will win a $50 gift certificate for the store. As afigurehead, Bernard the Boss has certain social, ceremonial and legal responsibilities that his employees expect him to fulfill. Bernard is seen as a source of inspiration and authority to his employees.
As Bernard goes about his day, he must make sure that he’s monitoring the performance of his employees and how well they are doing in their sales. He checks with his employees periodically to make sure they understand the products that are on sale and what key features to point out, as well as to remind them of their goal of winning the contest. Bernard the Boss’s role as aleader requires him to direct and manage the performance of his employees. He will spend time communicating performance goals, training and mentoring employees, supporting employee efforts, supplying resources, evaluating employee performance and motivating employees toward a higher level of productivity.
Bernard does not leave all the selling up to his employees, because he likes to maintain contact with his customers to better understand their needs and how he can accommodate them. He stops and chats with several customers throughout the day to get feedback on sale items and to learn about products that his customers would like to see the store put on sale in the future. Acting as a liaison is Bernard the Boss’s final interpersonal role. As a liaison, Bernard communicates with internal and external members of the organization. This networking activity is a critical step in reaching organizational goals, especially those concerned with customers.
The second category of managerial roles is informational roles. The informational roles include those roles in which a manager must generate and share knowledge to successfully achieve organizational goals. There are three roles listed under informational roles, which include monitor, disseminator and spokesperson.
After Bernard is comfortable with his employees’ understanding of the sales products and their goals, he heads back to his office to do some research for what he will put on sale next week. Bernard spends time reflecting on the feedback his employees gave and the information his customers shared with him that day, and he also looks at what his competitors are putting on sale at this time. The monitor role that Bernard the Boss must fill involves the task of researching, locating and choosing useful information. As a monitor, Bernard has to stay abreast to current industry standards and changes occurring in both the internal and external business environments. This also includes monitoring the performance of employees and their level of productivity.
Bernard combines all of the information into a proposal for next week’s sale advertisement and forwards the information to upper management for approval. He also spends some time previewing this information with his employees so that they can begin to familiarize themselves with the items. As a disseminator, Bernard must take the information he gathered as a monitor and forward it on to the appropriate individuals.
Now that Bernard has approval from upper management, he creates the advertisement for next week’s sale items and begins to distribute it to his customers. Acting as a spokesperson on behalf of the organization is Bernard’s final informational role. As a spokesperson, Bernard communicates information about the organization to outside parties.
The third category of managerial roles according to Mintzberg is called decisional roles. Decisional roles include roles such as the entrepreneur, disturbance-handler, resource-allocator and negotiator. All of these roles involve the process of using information to make decisions.
Bernard checks in with his employees at midday and notices that some of the sale items have not done as well as anticipated. After speaking with his employees, he learns that the items that have not been selling are sitting next to the generic brand on the shelves. These generic brands are still less expensive than the sale items and are causing customers to choose the less expensive version. Bernard makes the decision to move these items to a special display area where they can sit by themselves and hopefully attract more buyers. As an entrepreneur, Bernard the Boss is focused on process improvement. He looks for ways to improve productivity and efficiency within his organization and directs the change process from development to implementation.
Much like a professional basketball player needs to know how to dribble and shoot a basketball, or how a home builder understands the process of framing a house, managers also need to have a specific set of skills in order to effectively perform their jobs. Managerial skills are what the manager uses to assist the organization in accomplishing its goals. Specifically, a manager will make use of his or her own abilities, knowledge base, experiences, and perspectives to increase the productivity of those with whom they manage.
The toolbox for what a manager needs in order to perform their job effectively, typically, fall into one of three categories: technical skills, human skills, and conceptual skills. To give you a better understanding of these skills, let’s take a look at how each of these skills are applied by Manny the Manager and his employee Kelly the Financial Analyst.
Technical skills are those skills needed to accomplish a specific task. It is the ‘how to’ skill set that allows a manager to complete his or her job. These skills are the combination of formal education, training, and on-the-job experience. Most employees expect their managers to have a technical skill set above their own so that, when needed, an employee can come to their manager to find out how to do something specific to their individual job.
For example, let’s say that part of Kelly the Financial Analyst’s job is to update a balance sheet each week. Kelly is a novice financial analyst and is new to the company, so she’s expecting her manager, Manny, to show her how to perform this task initially, so that she can, eventually, do it on her own. Therefore, it is essential for Manny to have the technical skills of how to update a balance sheet so that he may, in turn, share that skill with Kelly. As a low-level manager, technical skills are most important for Manny due to how close his role is to the general workforce – in this case, Kelly.
The next type of skills a manager must have are human skills. These interpersonal skills are what a manager will use to work with his or her employees. Some people are born with good human skills; others must work much harder at it. Human skills are critical for all managers because they work with people. Managers with good human skills understand their role inside the manager/employee relationship and how important things, like trust, cohesion, fairness, empathy, and good will, are to the overall success of the organization. Human skills help the manager to communicate, lead, and motivate an employee to work towards a higher level of productivity.
For example, let’s go back to Kelly and Manny. Imagine Kelly’s job description was changing to include a greater deal of responsibility but for the same pay. Kelly is upset, and feels overwhelmed by this change. Manny is a manager with good human skills, so he is able to empathize and communicate his understanding of Kelly’s frustration with the change to her. Manny quickly works to find ways to motivate Kelly to continue to work at a higher level, despite the additional workload being placed on her.
Conceptual skills are the final type of skills a manager must possess inside their toolbox. The level of analytical ability to envision both the parts and its sum directly translates into a manager’s conceptual skill set. Essentially, a manager’s conceptual skills allow him or her to solve problems in a strategic and calculated fashion. Conceptual skills are becoming increasingly more important in today’s chaotic business environment.
Managers are, continually, being challenged to think conceptually about their organizations to develop action plans and harness resources to achieve organizational goals. A manager with good conceptual skills can look at a problem, break it down into manageable pieces, consider a variety of possible solutions, all before putting it back together again in a more effective and efficient manner. Conceptual skills are most important for top managers but still important for middle and low-level managers as well.
Emerging management issues and challenges:
- Globalization: Globalization phenomenon is getting popular these days. Globalization of business refers to the free flow of goods service, technology, labor, capital information, across the national boundary; it is closer economic integration among different countries in terms of flow of good service, capital labor and technology. Globalization is the tendency of expanding business in different countries. Managers have to work in boundary less world. There is no territory or barrier in export and import business. Globalization invites global competition. Organizations which were competing locally with local competitors now they have to compete with global competitors. It is very difficult to organization to survive and develop in such situation. Organizations should increase quality of product and reduce cost which is a challenge for manager. Many organizations are becoming global these days. They are running their business in different countries with different culture, climate, and geography, political and economic system. It is a challenging work for managers to prepare executives officers who can run business in such countries.
- Workforce diversity: – Modern organizations are characterized by workforce diversity. Diversified workforce is the reality of business these days. Organizations are becoming heterogeneous in terms of ethnicity, gender, nationality, age group, etc. People having different religions, different nationality works together under one roof. Different people have different nature and they show different behavior because they come from different background. How to manage such diversified workforce is a great challenge for managers. If such diversified workforce is managed properly, organization will be highly benefited because they also bring diversified skill and knowledge. But, if they are not managed properly, they create serious problem.
- Quality assurance and productivity: – Quality is the ability of the product to satisfy customers need. How to improve quality of the product or how to assure customers about the quality of the product has become a great challenge for management. Quality ensures organizations survival and growth. Organizations use quality to compete with competitors. Only improving quality of product organizations can face the global competition. Therefore, there must be continuous improvement in quality. Quality improvement has no boundary. It is the race without final line. It is said that people buy quality not product. And, to improve quality is a really a challenge for management. Along, with increasing quality to increase productivity again is another challenge for management. Organization must try to achieve higher productivity. Higher productivity only helps to reduce cost. Productivity is the ratio between input and output. Improved technology, employees, regular skill development and better utilization of resources helps to increase productivity. Total quality management is the latest approach or needs to improve quality.
- Technological advancement: – How to utilize advanced and sophisticated technology has become another challenge for management. Technology has developed beyond the expectation of anybody in the world over last 100 years. Tremendous advancement has been made in production, distribution and information technology. Managers must manage all this technology with the development of computer, the face of information technology has absolutely changed. Introduction of internet, email and other electronic media, have benefitted organizations in the field of productions, distribution and other areas of business. Decision making have been facilitated by information technology. Technological advancement has changed the nature of job. Most of the jobs which were performed by unskilled and semi-skilled labors previously, now they are performed by skilled labors. Number of white collar job is increasing and blue collar jobs are decreasing. Organization must train their employees about new technology. Only with new technology, Organization can compete with other competitors.
- Ethics and social responsibility: – Ethics is study of how our decisions affect other people. It is the study of people’s right and duties. The moral rules the people to make decisions and the nature of relationship among people. Ethics is to follow social code of conduct, social norms, values and attitude. The decisions made by managers have a broad reach both inside and outside the organization. So, managers must follow ethical norms and consider social responsibilities. Managerial decision must be based on ethical ground. But, these days ethics id\s decreasing in business world. So, many business organizations have unethical practice. Because of the unethical practice of some business houses, all business world is blamed.
How to fulfill social responsibility is also a challenge for management. The concept of corporate social responsibility has developed. Social responsibility means obligation of business organizations towards society community, people, share holders, etc. To provide quality product at affordable price, to develop more and more employment opportunities, to carry out different development activities in society, to control pollution are some social responsibilities of business organizations.
- Innovation and change: – Management must pay attention on innovation and change. Otherwise, they would go out of business. Rapid innovations are taking place in technology, product and service. Product lifecycle is getting shorter and shorter. Product needs continuous improvement if the life span is to be made long. New ideas, new techniques, new methods are being innovated; there must be new inventions of ideas, new invention of product. Old and outdated product cannot satisfy customers.
There is change in external environment, political and legal, socio-cultural, economic and technological environment change rapidly. How to adjust with such change, how to keep pace with such change, how to keep pace with such change that has become challenge for management. Empowerment: – This is the age of empowerment. Role difference between management and workers has narrowed down. Status between worker and manager is very narrow. Most of the decisions are taken at operating level. Workers are free to plan and schedule their work. They are given more and more autonomy and freedom. They participate in major decision making activities. Joint goal setting and joint performance evaluation has become common. Self managed work team had been established, more and more information are given to employees, and how to manage such empower team has become challenge for managers.