Indian Managers Academy.
Bangalore
Subject: Management Organization Theory
Unit One: Chapter One: Introduction to Management
History of Management:
The medieval times witnessed progress toward the growth of larger
and more complex organizations and the application of
increasingly sophisticated management techniques. Feudalism
contributed the concept of decentralization. The concepts evolved
by the Catholic Church can scarcely be improved on and are very
much pertinent to the management of modern organizations. The
concepts developed by the military and industry of the period are
widely used today, although in a more refined and elaborate form.
The concept of corporation as a separate entity has been a
remarkable and extremely useful contribution of the late Roman
law. Although no deliberate attempts toward theory-building are
discernible during the medieval times, the writings of the period do
offer an insight into the practice of management. Of special
significance are the works of Machiavelli.
Difficulties arise in tracing the history of management. Some see it
(by definition) as a late modern (in the sense of late modernity)
conceptualization. On those terms it cannot have a pre-modern
history, only harbingers (such as stewards). Others, however,
detect management-like activities in the pre-modern past. Some
writers trace the development of management-thought back to
Sumerian traders and to the builders of the pyramids of ancient
Egypt. Slave-owners through the centuries faced the problems of
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exploiting/motivating a dependent but sometimes unenthusiastic or
recalcitrant workforce, but many pre-industrial enterprises, given
their small scale, did not feel compelled to face the issues of
management systematically. However, innovations such as the
spread of Hindu-Arabic numerals (5th to 15th centuries) and the
codification of double-entry book-keeping (1494) provided tools
for management assessment, planning and control.Given the scale
of most commercial operations and the lack of mechanized record-
keeping and recording before the industrial revolution, it made
sense for most owners of enterprises in those times to carry out
management functions by and for themselves. But with growing
size and complexity of organizations, the split between owners
(individuals, industrial dynasties or groups of shareholders) and
day-to-day managers (independent specialists in planning and
control) gradually became more common.
19th century
Some argue that modern management as a discipline began as an
off-shoot of economics in the 19th century. Classical economists
such as Adam Smith (1723 - 1790) and John Stuart Mill (1806 -
1873) provided a theoretical background to resource-allocation,
production, and pricing issues. About the same time, innovators
like Eli Whitney (1765 - 1825), James Watt (1736 - 1819), and
Matthew Boulton (1728 - 1809) developed elements of technical
production such as standardization, quality-control procedures,
cost-accounting, interchangeability of parts, and work-planning.
Many of these aspects of management existed in the pre-1861
slave-based sector of the US economy. That environment saw 4
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million people, as the contemporary usages had it, "managed" in
profitable quasi-mass production.
By the late 19th century, marginal economists Alfred Marshall
(1842 - 1924) and Léon Walras (1834 - 1910) and others
introduced a new layer of complexity to the theoretical
underpinnings of management. Joseph Wharton offered the first
tertiary-level course in management in 1881.
20th century
By about 1900 one finds managers trying to place their theories on
what they regarded as a thoroughly scientific basis (see scientism
for perceived limitations of this belief). Examples include Henry
R. Towne's Science of management in the 1890s, Frederick
Winslow Taylor's Scientific management (1911), Frank and Lillian
Gilbreth's Applied motion study (1917), and Henry L. Gantt's
charts (1910s). J. Duncan wrote the first college management
textbook in 1911. In 1912 Yoichi Ueno introduced Taylorism to
Japan and became first management consultant of the "Japanese-
management style". His son Ichiro Ueno pioneered Japanese
quality-assurance.
The first comprehensive theories of management appeared around
1920. The Harvard Business School invented the Master of
Business Administration degree (MBA) in 1921. People like Henri
Fayol (1841 - 1925) and Alexander Church described the various
branches of management and their inter-relationships. In the early
20th century, people like Ordway Tead (1891 - 1973), Walter Scott
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and J. Mooney applied the principles of psychology to
management, while other writers, such as Elton Mayo (1880 -
1949), Mary Parker Follett (1868 - 1933), Chester Barnard (1886 -
1961), Max Weber (1864 - 1920), Rensis Likert (1903 - 1981), and
Chris Argyris (1923 - ) approached the phenomenon of
management from a sociological perspective.
Peter Drucker (1909 – 2005) wrote one of the earliest books on
applied management: Concept of the Corporation (published in
1946). It resulted from Alfred Sloan (chairman of General Motors
until 1956) commissioning a study of the organisation. Drucker
went on to write 39 books, many in the same vein.
H. Dodge, Ronald Fisher (1890 - 1962), and Thornton C. Fry
introduced statistical techniques into management-studies. In the
1940s, Patrick Blackett combined these statistical theories with
microeconomic theory and gave birth to the science of operations
research. Operations research, sometimes known as "management
science" (but distinct from Taylor's scientific management),
attempts to take a scientific approach to solving management
problems, particularly in the areas of logistics and operations.
Some of the more recent developments include the Theory of
Constraints, management by objectives, reengineering, and various
information-technology-driven theories such as agile software
development, as well as group management theories such as Cog's
Ladder.
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As the general recognition of managers as a class solidified during
the 20th century and gave perceived practitioners of the art/science
of management a certain amount of prestige, so the way opened for
popularised systems of management ideas to peddle their wares. In
this context many management fads may have had more to do with
pop psychology than with scientific theories of management.
Towards the end of the 20th century, business management came
to consist of six separate branches, namely:
Human resource management
Operations management or production management
Strategic management
Marketing management
Financial management
Information technology management responsible for
management information systems
21st century:
In the 21st century observers find it increasingly difficult to
subdivide management into functional categories in this way. More
and more processes simultaneously involve several categories.
Instead, one tends to think in terms of the various processes, tasks,
and objects subject to management.
Branches of management theory also exist relating to nonprofits
and to government: such as public administration, public
management, and educational management. Further, management
programs related to civil-society organizations have also spawned
programs in nonprofit management and social entrepreneurship.
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Note that many of the assumptions made by management have
come under attack from business ethics viewpoints, critical
management studies, and anti-corporate activism.
As one consequence, workplace democracy has become both more
common, and more advocated, in some places distributing all
management functions among the workers, each of whom takes on
a portion of the work. However, these models predate any current
political issue, and may occur more naturally than does a command
hierarchy. All management to some degree embraces democratic
principles in that in the long term workers must give majority
support to management; otherwise they leave to find other work, or
go on strike. Hence management has started to become less based
on the conceptualisation of classical military command-and-
control, and more about facilitation and support of collaborative
activity, utilizing principles such as those of human interaction
management to deal with the complexities of human interaction.
Indeed, the concept of Ubiquitous command-and-control posits
such a transformation for 21st century military management.
Four key realities of managing today:
• The only certainty today is change. Challenging goals motivate
people to strive for improvement and overcome obstacles and
resistance to change.
• Speed, teamwork, and flexibility are the orders of the day, from
both strategic and operational
standpoints.
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• Managers at all levels need to stay close to the customer.
Product/service quality is the driving force in the battle to stay
competitive.
• Without continuous improvement and lifelong learning, there can
be no true economic progress for individuals and organizations
alike.
Effective management is the key to a better world, but
mismanagement squanders our resources and jeopardizes our well-
being.
Introduction & Definition:
Management comprises directing and controlling a group of one or
more people or entities for the purpose of coordinating and
harmonizing them towards accomplishing a goal. Management
often encompasses the deployment and manipulation of human
resources, financial resources, technological resources, and natural
resources. Management can also refer to the person or people who
perform the act(s) of management.
The verb manage comes from the Italian maneggiare (to handle —
especially a horse), which in turn derives from the Latin manus
(hand). The French word mesnagement (later ménagement)
influenced the development in meaning of the English word
management in the 17th and 18th centuries.
Definitions:
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The following are some definitions of management:
F.W. TAYLOR; Management may be defined as the art of
securing maximum prosperity with a minimum of effort so as to
secure maximum prosperity and happiness for both the employer
and employee and give the public best possible service.
WHEELER; Management is centred on the administration or
managers of the firm who integrate men, material and money into
an effective operating unit.
LAWRENCE A. APPLEY; Management is the development of
people and not the direction of things…Management is personnel
administration.
HAROLD KOONTZ AND HEINZ WEIHRICH; Management
is the process of designing and maintaining an environment in
which individuals work with such performance for optimizing
efficiency in reaching goals..
OLIVER SHELDON: Management proper is the function in
industry, concerned in the execution of policy within the limits set
up by the administration and the employment of the organization
for the particular objects set before it.
In spite of these various definitions, it has become increasingly
difficult to formulate a single and universally acceptable definition
of management. But all these definitions are relevant, meaningful
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and functional in different contexts. They are nothing but the
reflections of different experts and their perspectives. But, most of
the definitions are limited in their outlook and range. Some
definitions are oriented towards decision-making, leadership or
human administration. But these definitions are not
comprehensive.
In our opinion, management is managing people and other
resources in the organization and outside the organization for
achieving the mission and objectives of the organization. It is
nothing but managing people with tact; managing people for
achieving targets.
The above definition is based on the process approach and is
equally significant as it implies the ongoing and increasing cyclical
operations in the form of management. A process also indicates
the dynamic nature of management. Management implies
managing change also.
Characteristics of management:
The following are the characteristics of management:
Management is an organized activity. Management, as a process
in group activities, essentially requires coordination among
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individuals and sub-groups. This results in an organized activity,
which may be rigid and formal or informal..
Management aims at the accomplishment of predetermined
objectives. Management as a group effort aims at the
accomplishment of predetermined objectives. These objectives
become the ultimate goals of any organization. All managerial
activities are systematically directed in the accomplishment of such
goals.
Management is both a science and an art. It is considered a
science because it has developed certain principles, laws, activities
and generalizations which are applicable to group activities. Even
though science is considered a systematic body of knowledge, it
cannot be considered as exact as the natural and physical sciences.
Art refers to the application of knowledge. Management is
regarded as an art because it can be applied effectively for solving
various organizational problems.
Management is a group activity. Management cannot be done in
isolations; it is not an individual activity. All the major
achievements in society have been made possible only through
group activities. It also helps in integrating human effort though
organized group activities.
Management principles are universal in nature. They are
applicable in government organizations, business, enterprises,
military organizations and educational institutions. Henry Fayol
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suggested this for the first time, and he pointed out certain
principles of management which generally apply every group
situation. Even though management principles are universal in
nature. , they are flexible. They provide working guidelines which
can be adapted according to the required situations.
Management integrates human and other resources. The
process of management usually results in integrating human and
other resources. The process of management usually results in
integrating human and other resources so as to accomplish
effective results. Of all resources, human resources are the most
precious and difficult to manage. It is essential to manage human
resources effectively for the efficient functioning of all the
organizations in society. It is for senior managers to ensure that all
personal goals of the individual are harnessed and fulfilled in the
accomplishment of organizational goals.
Is management a profession? Of late, management is regarded
as a profession, as it fulfils the following fundamental
characteristics of a profession:
It has a body of knowledge that is transferable.
Its basic principles can be identified, mastered and practiced.
It has a scientific approach.
It involves specific skills, tools and techniques.
It has to adhere to a code of ethics.
Management is the skill of getting things done through people.
Management acts as an effective in getting things done through
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people. It is the process or agency through which management
policies are planned and work is supervised.
Management has a distinctive significance. Increased
productivity, a favorable organizational climate and positive
attitude of the employees are nothing but reflections of good
management. In this sense, management has a separate existence
from the body of administration at the top. Management has a
separate entity in the other sense also. It differs from ownership.
The owner may be a manager, but a manager need not be an
owner. The effectiveness of a manager, whether he is an owner or
not, depends upon how he applies the knowledge and skill required
for the job.
Management is essential at different levels of organization.
The “level” suggests the arrangement of managerial positions in an
organization in working order. The upper level of the management
is known as top management. The middle level or echelon of
management is referred to as middle management. The lower level
of management is composed of foremen and supervisors. But
irrespective of these levels, all managers must perform the basic
managerial functions of planning, organizing, directing, and
controlling, in different degrees.
Management Principles are dynamic in nature. The very
concept of management involves a certain degree of dynamism;
therefore the principles laid down under it are also dynamic. The
principles of management are not stagnant: they keep changing.
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They are basically vibrant and respond practically to any major
changes in the environment.
Management utilizes a multi-disciplinary approach.
Management, as a fast developing subject, has attained
significance over the years. Many new techniques and principles
have been added to this discipline and now it has become a fully
developed subject. Computer engineering, industrial psychology,
sociology, anthropology, economics, quantitative techniques and
such other subjects have enriched the areas of management
discipline. Management thinkers and practitioners have utilized
these new developments in other fields to their best adv advantage.
Decision makers have started applying the systems approach and
complex quantitative techniques.
Management is a system of authority. Management can also be
defined as a system of authority. It has a special ability to
visualize things in the right perspective, to recognize, analyze and
define the objectives of a problem. It suggests and synthesizes
various alternatives for a particular problem, and tests the
conclusions to prove it applicability.
Different levels of management:
1. Top-level management
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Top-level managers require an extensive knowledge of
management roles and skills.
They have to be very aware of external factors such as
markets.
Their decisions are generally of a long-term nature.
They are responsible for strategic decisions.
They have to chalk out the plan and see that plan may be
effective in future.
Middle management
Mid-level managers have a specialised understanding of
certain managerial tasks.
They are responsible for and carrying out the decisions made
by top-level management.
They are responsible for tactical decisions.
Lower management
This level of management ensures that the decisions and plans
taken by the other two are carried out.
Lower-level managers' decisions are generally short-term
ones.
Strategic Management:
Formation of the business policy
The mission of the business is its most obvious purpose --
which may be, for example, to make soap.
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The objective of the business refers to the ends or activity at
which a certain task is aimed.
The business's policy is a guide that stipulates rules,
regulations and objectives, and may be used in the managers'
decision-making. It must be flexible and easily interpreted and
understood by all employees.
The business's strategy refers to the plan of action that it is
going to take, as well as the resources that it will be using, to
achieve its mission and objectives. It is a guideline to
managers, stipulating how they ought to use best the factors of
production to the business's advantage. Initially, it could help
the managers decide on what type of business they want to
form.
How to implement policies and strategies
All policies and strategies must be discussed with all
managerial personnel and staff. Managers must understand
where and how they can implement their policies and
strategies.
Plan of action must be devised for each department.
Policies and strategies must be reviewed regularly.
Contingency plans must be devised in case the environment
changes.
Assessments of progress ought to be carried out regularly by
top-level managers.
A good environment is required within the business.
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The development of policies and strategies
The missions, objectives, strengths and weaknesses of each
department must be analysed to determine their roles in
achieving the business's mission.
The forecasting method develops a reliable picture of the
business's future environment.
A planning unit must be created to ensure that all plans are
consistent and that policies and strategies are aimed at
achieving the same mission and objectives.
Contingency plans must be developed, just in case.
All policies must be discussed with all managerial personnel
and staff that is required in the execution of any departmental
policy.
Where policies and strategies fit into the planning process
They give mid- and lower-level managers a good idea of the
future plans for each department.
A framework is created whereby plans and decisions are
made.
Mid- and lower-level management may add their own plans to
the business's strategic ones.
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Traditionally, the term "management" refers to the activities (and
often the group of people) involved in the four general functions:
planning, organizing, leading and coordinating of resources. Note
that the four functions recur throughout the organization and are
highly integrated. Emerging trends in management include
assertions that leading is different than managing, and that the
nature of how the four functions are carried out must change to
accommodate a "new paradigm" in management. This topic in the
library helps the reader accomplish broad understanding of
management (including traditional and emerging views), and the
areas of knowledge and skills required to carry out the major
functions of management.
There are several interpretations of the term "supervision", but
typically supervision is the activity carried out by supervisors to
oversee the productivity and progress of employees who report
directly to the supervisors. For example, first-level supervisors
supervise entry-level employees. Depending on the size of the
organization, middle-managers supervise first-level supervisors,
chief executives supervise middle-managers, etc. Supervision is a
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management activity and supervisors have a management role in
the organization.
Many people today are seeking to understand -- and many people
are writing about -- the concept and practices of leadership. There
are a great many reasons for the popularity of the topic, including
that organizations are faced with changes like never before. The
concept of leadership is relevant to any aspect of ensuring
effectiveness in organizations and in managing change. This topic
in the Library helps you to fully understand the concept and
practices of leadership.
There has been an explosion of literature about leadership lately.
Leading is a very human activity -- we're all human -- so there are
many people who consider themselves experts on leadership.
Unfortunately, many people make strong assertions about
leadership without ever really understanding a great deal about
leadership. Understanding the concept of leadership requires more
than reading a few articles or fantasizing about what great leaders
should be.
Occasionally, writers will interchange "leadership" and
"supervision". Both activities are closely related. Supervision
requires leadership. Leadership does not necessarily have to
involve supervision.
Major Function: Planning
Simply put, planning is selecting priorities and results (goals,
objectives, etc.) and how those results will be achieved. Planning
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typically includes identifying goals, objectives, methods, resources
needed to carry out methods, responsibilities and dates for
completion of tasks. Examples of planning are strategic planning,
business planning, project planning, staffing planning, advertising
and promotions planning, etc.
Various Kinds of Plans
major types of planning: various other types of
- business planning planning (cont.)
- basics - - - computer system
- management by planning
objectives - - - fundraising planning
- program planning (nonprofit)
- project planning - - - fundraising (for-
- strategic planning profits)
(vision, mission, etc.) - - - leadership
development planning
various other types of - - - management
planning: development planning
- - - advertising and - - - marketing planning
promotions planning - - - performance
- - - disaster planning planning (generic)
- - - career planning - - - performance
- - - communications improvement plans
plan (external) - - - program planning
- - - communications - - - research design
plan (internal) planning
- - - staffing planning
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- - - supervisoral
development planning
- - - training and
development planning
Planning is the first tool of the four functions in the management
process. The difference between a successful and unsuccessful
manager lies within the planning procedure. Planning is the logical
thinking through goals and making the decision as to what needs to
be accomplished in order to reach the organizations’ objectives.
Managers use this process to plan for the future, like a blueprint to
foresee problems, decide on the actions to evade difficult issues
and to beat the competition. (Bateman, Snell, 2007). Planning is
the first step in management and is essential as it facilitates control,
valuable in decision making and in the avoidance of business ruin.
Wyeth has a global vision to lead the way to better health.
Employees at Wyeth are committed to excellence and through
Wyeth’ s clearly written Mission and Vision Statement, Wyeth
must live by its values which clarify the company’s objectives and
goals. Quality in the results that are achieved and how the results
are reached doing what is right, respect for others, value those that
lead and take pride in all they do, and the value of teamwork to
reach common goals. The continuous use of a plan is imperative as
Wyeth has divisions throughout the world. Planning allows Wyeth
to be at the top of the pharmaceutical industry and a healthcare
leader.
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Major Function: Organizing
Simply put, organizing is allocating and configuring resources to
accomplish the preferred goals and objectives establishing during
the planning processes.
In order to reach the objective outlined in the planning process,
structuring the work of the organization is a vital concern.
Organization is a matter of appointing individuals to assignments
or responsibilities that blend together to develop one purpose, to
accomplish the goals. These goals will be reached in accordance
with the company’s values and procedures. A manager must know
their subordinates and what they are capable of in order to organize
the most valuable resources a company has, its employees.
(Bateman, Snell, 2007). This is achieved through management
staffing the work division, setting up the training for the
employees, acquiring resources, and organizing the work group
into a productive team. The manager must then go over the plans
with the team, break the assignments into units that one person can
complete, link related jobs together in an understandable well-
organized style and appoint the jobs to individuals. (Allen, G.,
1998).
Organization is strong at Wyeth with the ability to be flexible,
except change and search for new products, Wyeth’ s leadership
provides needed direction for staff to achieve personal success that
leads to organizational success. Managers at Wyeth are responsible
for keeping communication lines open between departments to
eliminate any issues from forming. Wyeth would not be a
healthcare leader if there was little or no organization
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Major Function: Leading
Simply put, leading is establishing direction and influencing
people to follow that direction.
Organizational success is determined by the quality of leadership
that is exhibited. "A leader can be a manager, but a manager is not
necessarily a leader," says Gemmy Allen (1998). Leadership is the
power of persuasion of one person over others to inspire actions
towards achieving the goals of the company. Those in the
leadership role must be able to influence/motivate workers to an
elevated goal and direct themselves to the duties or responsibilities
assigned during the planning process. Leadership involves the
interpersonal characteristic of a manager's position that includes
communication and close contact with team members.
Managers at Wyeth are there to motivate workers to fulfill the
goals of the company and out-perform their competitors. They as
leaders have day to day contact with workers using open
communication and are able to give direction individually as well
as within teams, departments and divisions. Management is there
to inspire subordinates to ‘step up to the plate’ and find innovative
means to solve department problems. Authorizing staff to have the
capability to deal with situations is a significant part of leading.
Major Function: Coordinating & Controlling Resources
and Processes
Simply put, coordinating is monitoring and adjusting resources and
processes to achieve goals and objectives in a highly effective and
efficient fashion.
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The process that guarantees plans are being implemented properly
is the controlling process. Gemmy Allen stated that ‘Controlling is
the final link in the functional chain of management activities and
brings the functions of management cycle full circle.’ This allows
for the performance standard within the group to be set and
communicated. Control allows for ease of delegating tasks to team
members and as managers may be held accountable for the
performance of subordinates, they may be wise to extend timely
feedback of employee accomplishments.
Department meetings are daily at Wyeth. Meetings are used to
review the daily schedule, prevent problems and to ascertain when
problems do exist in order to address and solve those that occur as
quickly and as efficiently as possible. Control is the process
through which standards for performance of people and processes
are set, communicated, and applied. Controls are placed on Wyeth
employees by requiring the completion of daily responsibilities and
adherence to Wyeth’s SOP’s and guidelines, by possibly taking
disciplinary action when necessary. Managers and supervisors are
given work performance evaluations that are a form of control as it
connects performance assessments to rewards and corrective
actions. Evaluating employees is a continual process that takes
place regularly within the company.
Manager: A Management Pioneer
The Industrial Revolution began in the eighteenth century and
transformed the job of manager from owner-manager to
professional, salaried manager. Prior to industrialization, the
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United States was predominantly an agricultural society. The
production of manufactured goods was still in the handicraft stage
and consisted of household manufacturing, small shops, and local
mills. The inventions, machines, and processes of the Industrial
Revolution transformed business and management (such as, the
use of fossil fuels as sources of energy, the railroad, the
improvement of steel and aluminum metallurgical processes, the
development of electricity, and the discovery of the internal-
combustion engine.) With the industrial innovations in factory-
produced goods, transportation, and distribution, big business came
into being. New ideas and techniques were required for managing
these large-scale corporate enterprises.
Two large-scale institutions, the church and the military, served as
examples of control for these new managers. Many of the
management terms and techniques used today have their basis in
ecclesiastical and military authority (for example, superior,
subordinate, strategy, and mission). Military commanders need
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only give orders, and then discharge, penalize, and demote those
who do not carry them out and reward those who do.
Today, business and management continue to be transformed by
high technology. In order to keep pace with the increased speed
and complexity of business, new means of calculating, sorting and
processing information were invented. An interesting description
of the modern era is the Information Age that describes the general
use of technology to transmit information.
Managers realized that they could profit from immediate
knowledge of relevant information. The telegraph was the first
instrument to transform information into electrical form over long
distances. The telephone, radio, television, and computer expanded
instant information. Computers store and handle a vast amount of
data, automate manufacturing, and enhance modern
communication systems. The mainframe in the 1970s, the PC in
the 1980s and the office network in the first part of the 1990s were
the platforms that drove massive product development and growth
for the technology industry.
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Communication and processing technologies are an essential tool
in almost every field of business. The Internet, with its
interconnection of millions of computers, has evolved to
potentially become one of the greatest resources available to
businesses today. The World Wide Web (www) offers access to
vast information resources and an immense number of sites on the
Internet. Managers can access, store and move digital information
(voice, sound, text and numbers). Private corporate intranets
provide a universal interface for sharing company-wide
information and work group level information. Employees can
access information, collaborate, and distribute results anywhere,
anytime.
The computer and telecommunications industries continue to
converge and have resulted in advances in two-way pagers, digital
cellular service, desktop video-conferencing, portable satellite
phones, mini-dishes and high-speed Internet access. Business
documents include graphics and text on computers around the
world, sound, video and simultaneous voice communications.
Thus, the Information Age implies a time for a revolution in the
information environment for business and management. The
changes that are taking place may be more significant to
management than the Industrial Revolution.
Organizations are two or more people working together in a
structured, formal environment to achieve common goals.
Managers provide guidance, implementation, and coordination so
those organizational goals can be reached. The modern manager
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coaches employees of the organization to develop teamwork,
which effectively fulfills their needs and achieves organizational
objectives. The traditional autocratic organization with its
hierarchical system of management and an overbearing "boss" that
forces performance out of people is no longer needed. The modern
manager provides an atmosphere of empowerment by letting
workers make decisions and inspiring people to boost productivity.
Managers create and maintain an internal environment, commonly
called the organization, so that others can work efficiently in it. A
manager's job consists of planning, organizing, directing, and
controlling the resources of the organization. These resources
include people, jobs or positions, technology, facilities and
equipment, materials and supplies, information, and money.
Managers work in a dynamic environment and must anticipate and
adapt to challenges.
The job of every manager involves what is known as the functions
of management: planning, organizing, directing, and controlling.
These functions are goal-directed, interrelated and interdependent.
Planning involves devising a systematic process for attaining the
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goals of the organization. It prepares the organization for the
future. Organizing involves arranging the necessary resources to
carry out the plan. It is the process of creating structure,
establishing relationships, and allocating resources to accomplish
the goals of the organization. Directing involves the guiding,
leading, and overseeing of employees to achieve organizational
goals. Controlling involves verifying that actual performance
matches the plan. If performance results do not match the plan,
corrective action is taken.
Managers:
– Perform jobs that involve directly supporting the work
efforts of others.
– Help other people get important things done in timely,
high-quality, and satisfying ways.
– Assume roles such as coordinator, coach, or team leader.
The nature of managerial work.
– Managers work long hours.
– Managers are busy people.
– Managers are often interrupted.
– Managers work mostly with other people.
– Managers are communicators.
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The management process.
– An effective manager is one whose organizational unit,
group, or team consistently achieves its goals while its
members remain capable, committed, and enthusiastic.
– Key results Areas of an effective manager:
• Task performance.
• Job satisfaction.
Management Levels:
The extent to which managers perform the functions of
management - planning, organizing, directing, and controlling -
varies by level in the management hierarchy. The term supervisor
could be applied at all management levels of the organization to
those who direct the work of others. In common usage, however,
the title tends to be used only in the first level of the management
hierarchy. If an organization were divided into top, middle, and
lower managerial levels, the term generally applies to the lower
level.
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Supervisors are managers whose major functions emphasize
directing and controlling the work of employees in order to achieve
the team goals. They are the only level of management managing
non-managers. Thus, most of the supervisor's time is allocated to
the functions of directing and controlling. In contrast, top
managers spend most of their time on the functions of planning
and organizing. The top manager determines the mission and sets
the goals for the organization. His or her primary function is long-
range planning. Top management is accountable for the overall
management of the organization. Middle management implements
top management goals. Supervisors direct the actual work of the
organization at the operating level.
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Keystone in the Organization
The keystone view, identified by Professor Keith Davis, is many
people's ideal of a supervisor's job. The comparison between an
archway and an organization is very interesting. Without the
keystone (supervisor), the arch (organization) collapses. The
keystone is the central topmost stone of an arch. It is an essential
part because it takes the pressure of both sides, exerts pressure of
its own and uses them to strengthen the overall arch. The keystone
supervisor is the main connector joining management and
employees making it possible for each to perform effectively.
Supervisors are the level of management linking the operations of
each department to the rest of the organization. This view
underscores the critical importance of developing people at all
levels.
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Employees need their jobs and want to know what is expected of
them and how their work relates to the whole process. The
supervisor is the point of contact in the satisfaction of these needs
for employees. By his or her efforts toward productivity and
efficiency, the supervisor helps make the company successful,
which preserves and creates jobs. By interpreting policies and
giving instructions and information and through normal, everyday
contact with employees, the supervisor serves as the point of
contact with management. The keystone has determined that he or
she will control the job instead of the job controlling him or her.
Thus, It is the confidence in self that will help determine the
success of the manager.
Managerial Roles
To meet the many demands of performing their functions,
managers assume multiple roles. A role is an organized set of
behaviors. Henry Mintzberg has identified ten roles common to the
work of all managers. The ten roles are divided into three groups:
interpersonal, informational, and decisional*. The informational
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roles link all managerial work together. The interpersonal roles
ensure that information is provided. The decisional roles make
significant use of the information. The performance of managerial
roles and the requirements of these roles can be played at different
times by the same manager and to different degrees depending on
the level and function of management. The ten roles are described
individually, but they form an integrated whole.
The three interpersonal roles are primarily concerned with
interpersonal relationships.
In the figurehead role, the manager represents the organization in
all matters of formality. The top level manager represents the
company legally and socially to those outside of the organization.
The supervisor represents the work group to higher management
and higher management to the work group. In the liaison role, the
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manger interacts with peers and people outside the organization.
The top level manager uses the liaison role to gain favors and
information, while the supervisor uses it to maintain the routine
flow of work. The leader role defines the relationships between the
manger and employees.
The direct relationships with people in the interpersonal roles place
the manager in a unique position to get information. Thus, the
three informational roles are primarily concerned with the
information aspects of managerial work. In the monitor role, the
manager receives and collects information. In the role of
disseminator, the manager transmits special information into the
organization. The top level manager receives and transmits more
information from people outside the organization than the
supervisor. In the role of spokesperson, the manager disseminates
the organization's information into its environment. Thus, the top
level manager is seen as an industry expert, while the supervisor is
seen as a unit or departmental expert.
The unique access to information places the manager at the center
of organizational decision making. There are four decisional roles.
In the entrepreneur role, the manager initiates change. In the
disturbance handler role, the manger deals with threats to the
organization. In the resource allocator role, the manager chooses
where the organization will expend its efforts. In the negotiator
role, the manager negotiates on behalf of the organization. The top
level manager makes the decisions about the organization as a
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whole, while the supervisor makes decisions about his or her
particular work unit.
The supervisor performs these managerial roles but with different
emphasis than higher managers. Supervisory management is more
focused and short-term in outlook. Thus, the figurehead role
becomes less significant and the disturbance handler and negotiator
roles increase in importance for the supervisor. Since leadership
permeates all activities, the leader role is among the most
important of all roles at all levels of management.
Mintzberg: The Managerial Roles
Mintzberg (1973) groups managerial activities and roles as
involving:
Managerial activities Associated roles
Interpersonal roles -
arising from formal figurehead
authority and status and liaison
supporting the leader
information and decision
activities.
monitor
information processing disseminator
roles spokesman
decision roles: making improver/changer
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disturbance handler
significant decisions resource allocator
negotiator
The broad proposition is that, as a senior manager enacts his/her
role, these will come together as a gestalt (integrated whole)
reflecting the manager's competencies associated with the roles. In
a sense therefore they act as evaluation criteria for assessing the
performance of a manager in his/her role.
Figurehead.
Social, inspirational, legal and ceremonial duties must be carried
out. The manager is a symbol and must be on-hand for
people/agencies that will only deal with him/her because of status
and authority.
The leader role
This is at the heart of the manager-subordinate relationship and
managerial power and pervasive where subordinates are involved
even where perhaps the relationship is not directly interpersonal.
The manager defines the structures and environments within which
sub-ordinates work and are motivated. Oversees and questions
activities to keep them alert. Selects, encourages, promotes and
disciplines. Tries to balance subordinate and organizational needs
for efficient operations.
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Liaison:
This is the manager as an information and communication centre.
It is vital to build up favours. Networking skills to shape maintain
internal and external contacts for information exchange are
essential. These contacts give access to "databases"- facts,
requirements, probabilities.
As 'monitor'
- the manager seeks/receives information from many sources to
evaluate the organisation's performance, well-being and situation.
Monitoring of internal operations, external events, ideas, trends,
analysis and pressures is vital. Information to detect changes,
problems & opportunities and to construct decision-making
scenarios can be current/historic, tangible (hard) or soft,
documented or non-documented.This role is about building and
using an intelligence system. The manager must install and
maintain this information system; by building contacts & training
staff to deliver "information".
As disseminator
- the manager brings external views into his/her organisation and
facilitiates internal information flows between subordinates
(factual or value-based).
The preferences of significant people are received and assimilated.
The manager interprets/disseminates information to subordinates
e.g. policies, rules, regulations. Values are also disseminated via
conversations laced with imperatives and signs/icons about what is
regarded as important or what 'we believe in'.
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There is a dilemma of delegation. Only the manager has the data
for many decisions and often in the wrong form (verbal/memory
vs. paper). Sharing is time-consuming and difficult. He/she and
staff may be already overloaded. Communication consumes time.
The adage 'if you want to get things done, (it is best to do it
yourself' comes to mind. Why might this be a driver of managerial
behavior (reluctance or constraints on the ability to delegate)?
As spokesman (P.R. capacity)
- the manager informs and lobbies others (external to his/her own
organizational group). Key influencers and stakeholders are kept
informed of performances, plans & policies. For outsiders, the
manager is an expert in the field in which his/her organization
operates.
A senior manager is responsible for his/her organization’s strategy-
making system - generating and linking important decisions.
He/she has the authority, information and capacity for control and
integration over important decisions.
As initiator / changer
- he/she designs and initiates much of the controlled change in the
organization. Gaps are identified, improvement programs defined.
The manager initiates a series of related decisions/activities to
achieve actual improvement. Improvement projects may be
involved at various levels. The manager can delegate all design
responsibility selecting and even replace subordinates. Empower
subordinates with responsibility for the design of the improvement
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program but e.g. define the parameters/limits and veto or give the
go-ahead on options. Supervise design directly.
Senior managers may have many projects at various development
stages (emergent/dormant/nearly-ready) working on each
periodically interspersed by waiting periods for information
feedback or progress etc. Projects roll-on and roll-off,
The disturbance handler
- is a generalist role i.e. taking charge when the organization hits
an iceberg unexpectedly and where there is no clear programmed
response. Disturbances may arise from staff, resources, threats or
because others make mistakes or innovation has unexpected
consequences. The role involves stepping in to calm matters,
evaluate, re-allocate, support - removing the thorn - buying time.
The metaphors here are
If you are up to your backside in alligators it is no use talking
about draining the swamp. and Stop the bleeding as only then can
you take care of the long term health of the patient. (not
Mintzberg's anecdote)
As resource allocator
the manager oversees allocation of all resources (£, staff,
reputation). This involves: scheduling own time , programming
work , authorizing actions
With an eye to the diary (scheduling) the manager implicitly sets
organizational priorities. Time and access involve opportunity
costs. What fails to reach him/her, fails to get support.
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The managerial task is to ensure the basic work system is in place
and to program staff overloads - what to do, by whom, what
processing structures will be used.
Authorizing major decisions before implementation is a control
over resource allocation. This enables coordinative interventions
e.g. authorization within a policy or budgeting process in
comparison to ad-hoc interventions. With limited time, complex
issues and staff proposals that cannot be dismissed lightly, the
manager may decide on the proposer rather than proposal.
To help evaluation processes, managers develop models and plans
in their heads (they construe the relationships and signifiers in the
situation). These models/constructions encompass rules,
imperatives, criteria and preferences to evaluate proposals against.
Loose, flexible and implicit plans are up-dated with new
information.
The negotiator
- takes charge over important negotiating activities with other
organizations. The spokesman, figurehead and resource allocator
roles demand this.
Managerial Skills
In order to perform the functions of management and to assume
multiple roles, managers must be skilled. Robert Katz identified
three managerial skills that are essential to successful management:
Technical,
Human, and
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Conceptual.
Technical skill involves process or technique knowledge and
proficiency. Managers use the processes, techniques and tools of a
specific area.
Human skill involves the ability to interact effectively with people.
Managers interact and cooperate with employees.
Conceptual skill involves the formulation of ideas. Managers
understand abstract relationships, develop ideas, and solve
problems creatively. Thus, technical skill deals with things, human
skill concerns people, and conceptual skill has to do with ideas.
A manager's level in the organization determines the relative
importance of possessing technical, human, and conceptual skills.
Top level managers need conceptual skills in order to view the
organization as a whole. Conceptual skills are used in planning and
dealing with ideas and abstractions. Supervisors need technical
skills to manage their area of specialty. All levels of management
need human skills in order to interact and communicate with other
people successfully.
Study Material: SEM1/UNIT 1/ Introduction to Management Prof. Deepesh Payyazhi
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Competitive Advantage - Definition
A competitive advantage is an advantage over competitors gained
by offering consumers greater value, either by means of lower
prices or by providing greater benefits and service that justifies
higher prices.
Competitive Strategies
Following on from his work analysing the competitive forces in an
industry, Michael Porter suggested four "generic" business
strategies that could be adopted in order to gain competitive
advantage. The four strategies relate to the extent to which the
scope of a businesses' activities are narrow versus broad and the
extent to which a business seeks to differentiate its products.
The four strategies are summarised in the figure below:
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The differentiation and cost leadership strategies seek competitive
advantage in a broad range of market or industry segments. By
contrast, the differentiation focus and cost focus strategies are
adopted in a narrow market or industry.
Strategy - Differentiation
This strategy involves selecting one or more criteria used by
buyers in a market - and then positioning the business uniquely to
meet those criteria. This strategy is usually associated with
charging a premium price for the product - often to reflect the
higher production costs and extra value-added features provided
for the consumer. Differentiation is about charging a premium
price that more than covers the additional production costs, and
about giving customers clear reasons to prefer the product over
other, less differentiated products.
Examples of Differentiation Strategy: Mercedes cars; Bang &
Olufsen
Strategy - Cost Leadership
With this strategy, the objective is to become the lowest-cost
producer in the industry. Many (perhaps all) market segments in
the industry are supplied with the emphasis placed minimising
costs. If the achieved selling price can at least equal (or near)the
average for the market, then the lowest-cost producer will (in
theory) enjoy the best profits. This strategy is usually associated
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with large-scale businesses offering "standard" products with
relatively little differentiation that are perfectly acceptable to the
majority of customers. Occasionally, a low-cost leader will also
discount its product to maximise sales, particularly if it has a
significant cost advantage over the competition and, in doing so, it
can further increase its market share.
Examples of Cost Leadership: Nissan; Tesco; Dell Computers
Strategy - Differentiation Focus
In the differentiation focus strategy, a business aims to differentiate
within just one or a small number of target market segments. The
special customer needs of the segment mean that there are
opportunities to provide products that are clearly different from
competitors who may be targeting a broader group of customers.
The important issue for any business adopting this strategy is to
ensure that customers really do have different needs and wants - in
other words that there is a valid basis for differentiation - and that
existing competitor products are not meeting those needs and
wants.
Examples of Differentiation Focus: any successful niche retailers;
(e.g. The Perfume Shop); or specialist holiday operator (e.g.
Carrier)
Strategy - Cost Focus
Here a business seeks a lower-cost advantage in just on or a small
number of market segments. The product will be basic - perhaps a
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similar product to the higher-priced and featured market leader, but
acceptable to sufficient consumers. Such products are often called
"me-too's".
Examples of Cost Focus: Many smaller retailers featuring own-
label or discounted label products.
New challenges of management
1. Being concurrently nomadic and collaborative.
2. Renewing the workplace social contract.
3. Creating new modes of leadership.
4. Creating value, not just revenue.
5. The production of collective knowledge.
6. Managing with both IQ and EQ (emotional quotient).
7. A diverse community rather than a disciplined unity.
8. Learning about the reality of the virtual.
Interestingly, even with this diversity of perspectives, we found
our views on today's top talent challenges to be surprisingly
aligned. I thought you might like to see our list—and would love to
hear your thoughts on things you're wrestling with that we missed.
Here goes:
1. Attracting and retaining enough employees at all levels to
meet the needs of organic and inorganic growth. All three
companies are facing a talent crunch. Essar, for example, has
grown from 20 thousand employees to a staggering 60 thousand in
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the past 3 years. Fifty-five percent of their employees have less
than two years of tenure.
2. Creating a value proposition that appeals to multiple
generations. With four generations in today's workplace, most
companies are struggling to create an employee experience that
appeals to individuals with diverse needs, preferences and
assumptions. The Gap, for example, has 153,000 people in its
workforce. The stores have a high percentage of Gen Y employees,
while corporate roles and leadership ranks are primarily made up
of Gen X'ers and Boomers. How does one create a compelling
employee value proposition for the organization?
3. Developing a robust leadership pipeline. I believe one of the
biggest potential threats to many corporations is a lack of a robust
talent pool from which to select future leaders. This is in part a
numbers issue—the Gen X cohort is small and therefore, as I like
to say, precious. But it's also an interest issue—many members of
Gen X are simply not particularly excited about being considered
for these roles. There was wide agreement among the panelists that
a lack of individuals ready to move into senior client manager and
leadership roles is a critical challenge.
4. Rounding out the capabilities of hires who lack the breadth
of necessary for global leadership. It's relatively straightforward
to identify and assess experts in specific functional or technical
arenas, but much more difficult to determine whether those
individuals have the people skills, leadership capabilities, business
breadth, and global diversity sensibilities required for the nature of
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leadership today. Increasingly, the challenge of developing these
broader skill sets falls to the corporations. Essar has formed an
academy specifically to develop and groom its own leaders.
5. Transferring key knowledge and relationships. The looming
retirement of a significant portion of the workforce challenges all
companies, but particularly those who are dependant on the
strength of tacit knowledge, such as that embedded in customer
relationships, a key to Mercer's business success.
6. Stemming the exodus of Gen X'ers from corporate life. A big
threat in many firms today is the exodus of mid-career talent—
people in whom the organization has invested heavily and in whom
it has pinned it hopes for future leadership. For example,
developing talent management practices and programs calibrated
to leverage technology and create greater work/life balance has
been a priority for Mercer over recent years.
7. Redesigning talent management practices to attract and
retain Gen Y's. The challenge of calibrating talent management
practices and programs to attract and engage our young entrants is
critically important to all firms and particularly so for firms that
depend on a strong flow of top talent, such professional service
firms like Mercer. All three panelists agreed that making the
business infrastructure more attractive to Gen Y is a high priority.
8. Creating a workplace that is open to Boomers in their
"second careers." Age prejudice still exists, but smart companies
are looking for ways to incorporate the talents of Boomers and
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even older workers in the workforce. In many cases, this requires
rethinking roles and work relationships.
9. Overcoming a "norm" of short tenure and frequent
movement. Some industries, such as specialty retail, are known for
having a very disposable view of talent. Companies intent on
changing that norm, such as The Gap, must address both external
influences in the marketplace and an internal mindset. The Gap
believes retaining employees in roles for 3+ years will be a key to
their future earnings growth.
10. Enlisting executives who don't appreciate the challenge.
Many talent executives complain that business leaders still believe
that people are lined up outside the door because of the power of
the company's brand. The challenge of enlisting the support of all
executives for the transition from a talent culture that has
traditionally operated with a "buy" strategy to one that places more
emphasis on "build" is widely shared.
Study Material: SEM1/UNIT 1/ Introduction to Management Prof. Deepesh Payyazhi