BBH 102 – Basics of Management Unit 1 Notes Jan 26 2018.pdf

BBH 102 – BASICS OF
MANAGEMENT
Unit 1

COURSE CURRICULUM
Unit 1 - INTRODUCTION
 Nature of Management
 Levels of Management
 Principles and Importance of Management
 Universality of Management

COURSE CURRICULUM
Unit 2 - PLANNING
 Nature of Planning
 Objective of Planning
 Importance of Planning
 Planning Process
 Decision Making

COURSE CURRICULUM
Unit 3 - ORGANISING
 Nature of Organising
 Importance of Organising
 Organization structure
 Forms of organization structure

COURSE CURRICULUM
Unit 4 - DIRECTING
 Meaning of Directing
 Concept of Directing
 Principles and Techniques of Direction
 Communication
 Motivation

COURSE CURRICULUM
Unit 5 – CONTROLLING AND CO-ORDINATING
 Meaning of Controlling
 Concept of Controlling
 Control Process
 Requirement of effective control system
 Co-ordinating

READINGS
1. Koontz O’ Donnel and Wielrich: Essentials of
Management
2. R S Dawar: The Process of Management
3. Banerjee: Principles and Practice of Management
4. Peter F Drucker: Management Tasks,
Responsibilities, Practices
5. Ishwar Dayal: New Concepts in Management
6. Srinivasan: Management Principles and Practice
7. Gupta C BL Principles of Management
8. G R Terry: Principles of Management

UNIT 1 – WHY STUDY MANAGEMENT?
1. Management helps one work better with people
2. Employers want to hire employees who can participate in
managing the firm e.g. GE Capital International Services
(Genpact) – Everyone who was hired was a potential CEO!
3. Even individual contributors are trained to perform in
management functions – helps in improving inter-personal
skills
4. Study of management helps in building skills needed –
working as a partner or in a team – Decision making, sharing

UNIT 1 – WHY STUDY MANAGEMENT?
5. Management study also applies in personal life –
• Helps in communicating better with people on an
everyday basis
• Helps in making personal plans eg. Planning a trip,
organizing at home, prioritizing what to study, get
others to do things
• Society needs Leaders who are just and humane, can
be team players

UNIT 1 – WHAT IS A MANAGER’S
RESPONSIBILITY
 Manager
 The individual responsible for achieving organizational objectives
through efficient and effective utilization of resources. Participative
 The Manager’s Resources
 Human, financial, physical, and informational
 Performance
 Means of evaluating how effectively and efficiently managers use
resources to achieve objectives.
 Today often means ―How‖ as well as ―What‖

UNIT 1 – WHAT DOES IT TAKE TO BE A
SUCCESSFUL MANAGER
 Management Qualities (Survey of
Execs.)
 Integrity, industriousness, and the ability
to get along with people
 Management Skills
 Technical
 Human and communication (Teaming)
 Conceptual and decision-making skills
 ―Systems Thinking‖ & ―Critical Thinking‖
 The Ghiselli Study(6 Traits of Manager
Success – Inverse Order)
6) Initiative, 5)self-assurance,4) decisiveness,
3) intelligence, 2) need for occupational
achievement, and 1) supervisory ability

UNIT 1 - INTRODUCTION
So what is Management? According to Terry:
MANAGEMENT is:
Planning
Organizing
Leading and
Controlling
Of human and other resources to achieve organization
goals effectively and efficiently

UNIT 1 – WHAT IS MANAGEMENT? -
DEFINITION
Management is a process – a systematic way of doing things.
It consists of the following activities: (more may be added to
it)
 Planning – Thinking of Actions in advance
 Organizing – Co-ordinating human and material
resources
 Leading – Influencing others to reach desired goals
 Actuating – Motivating and directing sub-ordinates
 Controlling – No deviation from norm or plan

UNIT 1 – WHAT DO MANAGERS DO?
 Management Functions (Different Scope at job level)
 Planning
 Setting objectives and determining in advance exactly (?)
how the objectives will be met.
 Monitor for Change and Anticipate or React
 PDCA – Plan – Do – Check - Act
 Organizing
 Delegating and coordinating tasks and allocating resources
to achieve objectives.
 Leading
 Influencing employees to work toward achieving objectives.
 Setting an Example (Shadow of the Leader)
 Controlling
 Establishing and implementing mechanisms to ensure that
objectives are achieved.

UNIT 1 – WHY IS MANAGEMENT IMPORTANT?
For FIRM - According to a recent survey by Shareholder Surveys,
shareholders rank good management and long-term vision as
the two most important characteristics of a firm
It is a dynamic element of organization:
Co-ordinate current activities
Provide leadership thought
Help organization adapt to environment
Help shape environment
Help give competitive edge over the competitors

UNIT 1 – WHY IS MANAGEMENT IMPORTANT?
For COUNTRY – Helps in economic growth. It brings the
four factors of production – men, money, material and
machines to produce goods and services

UNIT 1 – IS MANAGEMENT A SCIENCE OR AN
ART?
A science is an organized body of knowledge
A discipline is scientific if its methods of inquiry are systematic
and empirical, if information can be ordered and analyzed and the
results are cumulative and communicable.
Systematic – Orderly, Unbiased
Ordered and Analyzed – with statistical tools
Communicated and allows repetition
Cumulative – what has been found before is added

ART?
Science is used to denote two kinds of knowledge – Exact or
natural (Physics and Chemistry) and Behavioural or
Inexact, where we can only have a rough idea of the impact
of one variable on another. In the sense of behavioural
science, Management is associated with science.

ART?
Art is concerned with understanding how a particular work
can be accomplished. As a practice, Management is Art.
Management as a profession, according to Mc Farland, is
organized and systematic knowledge, there is a formal
method of acquiring training and experience, there is
association between a professional and goal, there is an
ethics code of conduct to govern behaviour.

ART?
Therefore while Management as a practice is an art, the
organized knowledge underlying the practice is a science. In
its Art and Science debate, both are complementary, not
mutually exclusive.

UNIT 1 – WHAT ARE THE FUNCTIONS OF
MANAGEMENT?
I. Fayol – 5 functions (POCCC) – Managers across levels
perform these functions (General Industrial
Management)
i. Planning
ii. Organizing
iii. Commanding
iv. Co-ordinating
v. Controlling

MANAGEMENT?
II. Luther Gulick – 7 functions (POSDCORB)
i. Planning
ii. Organizing
iii. Staffing
iv. Directing
v. Co-ordinating
vi. Reporting
vii. Budgeting

MANAGEMENT?
III. Warren Haynes & Joseph Massie
i. Decision Making
ii. Organizing
iii. Staffing
iv. Controlling
v. Communicating
vi. Directing

MANAGEMENT?
IV. Koontz O’ Donnell
i. Decision Making
ii. Organizing
iii. Directing
iv. Controlling

MANAGEMENT?
V. Ernest Dale
i. Innovation
ii. Representation

UNIT 1 –MANAGEMENT FUNCTIONS

UNIT 1 – SOME KEY FUNCTIONS – INSIDE VIEW
I. Planning
This function determines in advance WHAT should be done.
If we are deciding how to attain business objectives – we will
answer the following questions:
a. What to do?
b. How to do it?
c. Where it should be done?
d. Who is to do it?
e. How results are to be evaluated?

For whom is planning done?
Planning is done not only for the organization as a whole,
but for every department, unit or division
Who performs this function?
Managers across all levels – top management, middle
management and supervisory management

Types of plans
Long term plans: 5 – 10 years (especially by Top
Management)
Short term plans: Monthly, weekly, daily – done by lower
level supervisors

Planning function determines how effective an
organization is and helps in determining strategy of the
organization.
Three Steps in the Planning Process:
Deciding which goals to pursue.
Deciding what courses of action to adopt.
Deciding how to allocate resources.

II. Organizing
 When a manager organizes, he is involved in helping provide raw
materials and other resources to personnel, to help attain
objectives.
―Organizing is what you do, before you do something, so that when
you do it, it is not all mixed up”.
 Staffing is an important part of organizing. It means finding the
right people for the right job.

II. Organizing
Organization
People working together and coordinating their actions to achieve
specific goals.
Goal/objective
A desired future condition that the organization seeks to achieve.
While Organizing, managers structure work relationships in
such a way that allows organization members to work together to
achieve organizational goals. This involves, grouping employees into
departments according to the tasks performed and laying out lines of
authority and responsibility for organizational members.

III. Directing
 Direction involves:
 Communication: Process to relay or pass information
from one person to another
 Leadership: Process by which manager guides and
influences work of sub-ordinates
 Motivation: Arousing desire in the minds of workers
to give best to the enterprise. Motivated employees help
organizations achieve objectives. Motivation can be
through monetary or non – monetary methods.

IV. Controlling
 A manager needs to ensure everything is occurring in accordance
with plans and whatever instructions have been issued.
 The three important aspects of controlling are:
 Establish standards of performance
Measure current performance and compare with
established standards
 Take corrective action to correct performance which does
not meet standards.

V. Innovation
 It is not necessary for organizations to grow bigger, it is
important for them to grow better.
 Innovations leads to creating new ideas, which results in
development of new products, or finding new uses for old
products.

VI. Representation
 Representing the organization in front of outside groups.
 Examples are: government officials, labour unions,
financial institutions, suppliers and customers.

VII. Leadership
Articulating a clear vision to follow, and energizing and enabling
organizational members so they understand the part they play in
attaining organizational goals.
Leadership involves using power, influence, vision,
persuasion, and communication skills.
The of leadership is highly motivated and
committed organizational members.

UNIT 1 – SYSTEMS RELATIONSHIP AMONG
MANAGEMENT FUNCTIONS
Planning
Organizing
Leading
Controlling
Management
Functions
Management
Skills

UNIT 1 – LEVELS OF MANAGEMENT
 Levels of Management
 First-line managers/ Front Line Managers
 Responsible for day-to-day operations. Supervise people
performing activities required to make the good or service.
 Team leader, supervisor, head nurse, or office manager
 Middle managers
 Supervise first-line managers. Are responsible to find the
best way to use departmental resources to achieve goals.
 Sales manager, branch manager, or department head
 Top managers
 Responsible for the performance of all departments and have
cross-departmental responsibility.
 Establish organizational goals and monitor middle managers.
 Form top management team along with the CEO and COO.
 CEO, president, or vice president

 Levels of Management
Individual Contributors (ICs)
Non-management operative employees
Workers in the organization who are supervised by
first-line managers.
Professionals/Specialists/Technicians (Knowledge
Workers)

MANAGEMENT LEVELS AND FUNCTIONAL AREAS
INDIVIDUAL CONTRIBUTORS OFTEN REPORT
ANYWHERE
SOME
ORGANIZATIONS
―FLIP‖ THIS CHART
UPSIDE DOWN

TYPES OF MANAGERS
 General Managers
 Supervise the activities of several departments.
 Functional Managers
 Supervise the activities of related tasks.
 Common functional areas:
 Marketing/Sales/Product Development
 Operations/Production/Services Delivery
 Finance/Accounting
 Human Resources/personnel management
 Infrastructure (IT, Real Estate, Legal)
 Project Managers
 Coordinate employees across several functional departments to
accomplish a specific task.

UNIT 1 – RELATIVE AMOUNT OF TIME SPENT
BY LEVELS OF MANAGEMENT

1–47
MANAGEMENT SKILLS AND FUNCTIONS
 Differences among management levels in skill
needed and the functions performed:
Planning
Organizing
Leading
Controlling

UNIT 1 – ROLES MANAGERS PLAY
 Role
A set of expectations of how one will behave in a given
situation.
 Managerial Role
The set of specific tasks that a person is expected to
perform because of the position he or she holds in the
organization.
 Roles are defined into three role categories (as identified
by Mintzberg):
Interpersonal  Informational  Decisional

UNIT 1 – ROLES MANAGERS PLAY
Managers play various roles as necessary while
performing their management functions so as to achieve
organizational objectives.

INTERPERSONAL ROLES
 Roles that managers assume to provide direction
and supervision to both employees and the
organization as a whole:
 Figurehead—symbolizing the organization’s
mission and what it is seeking to achieve.
 Leader—training, counseling, and mentoring high
employee performance.
 Liaison—linking and coordinating the activities of
people and groups both inside and outside the
organization/department.

INFORMATIONAL ROLES
 Roles associated with the tasks needed to obtain
and transmit information in the process of
managing the organization:
 Monitor—analyzing information from both the
internal and external environment.
 Disseminator—transmitting information to
influence the attitudes and behavior of employees.
 Spokesperson—using information to positively
influence the way people in and out of the
organization respond to it.

DECISIONAL ROLES
 Roles associated with methods managers use in
planning strategy and utilizing resources:
 Entrepreneur—deciding which new projects or
programs to initiate and to invest resources in.
 Disturbance handler—managing an unexpected
event or crisis.
 Resource allocator—assigning resources between
functions and divisions, setting the budgets of lower
managers.
 Negotiator—reaching agreements between other
managers, unions, customers, or shareholders.

BEING A MANAGER
Brevity
High Variety Fragmentation
Managerial
Problems
Compensation to be a manager

MANAGERIAL SKILLS
 Conceptual Skills
 The ability to analyze and diagnose a situation and
distinguish between cause and effect.
 Human Skills
 The ability to understand, alter, lead, and control the
behavior of other individuals and groups.
 Technical Skills
 The specific knowledge and techniques required to
perform an organizational role.
What should be the right thing?
How can we do better?

SKILL TYPES NEEDED BY MANAGERIAL LEVEL

CONCEPTUAL SKILLS
•Using information to solve business problems
•Identifying of opportunities for innovation
•Recognizing problem areas and implementing
solutions
•Selecting critical information from masses of
data
•Understanding of business uses of technology
•Understanding of organization’s business
model

COMMUNICATION SKILLS
•Ability to transform ideas into words and
actions
•Credibility among colleagues, peers, and
subordinates
•Listening and asking questions
•Presentation skills; spoken format
•Presentation skills; written and/or graphic
formats

EFFECTIVENESS SKILLS
•Contributing to corporate mission/departmental
objectives
•Customer focus
•Multitasking: working at multiple tasks in parallel
•Negotiating skills
•Project management
•Reviewing operations and implementing improvements
•Setting and maintaining performance standards
internally and externally
•Setting priorities for attention and activity
•Time management

INTER-PERSONAL SKILLS
•Coaching and mentoring skills
•Diversity skills: working with diverse people
and cultures
•Networking within the organization
•Networking outside the organization
•Working in teams; cooperation and
commitment

MANAGEMENT SKILLS AND MANAGEMENT
FUNCTION MATRIX

HOW THE MANAGER’S JOB IS CHANGING
 The Increasing Importance of Customers
 Customers: the reason that organizations exist
 Managing customer relationships is the responsibility of all
managers and employees.
 Consistent high quality customer service is essential for
survival.
 Innovation
 Doing things differently, exploring new territory,
and taking risks
 Managers should encourage employees to be aware of and
act on opportunities for innovation.

CHANGES IMPACTING THE MANAGER’S JOB

FAYOL’S PRINCIPLES OF MANAGEMENT
 Fourteen Principles of Management (Tools for
Accomplishing Objectives)
 Division of work - limited set of tasks
 Authority and Responsibility - right to give orders
 Discipline - agreements and sanctions
 Unity of Command - only one supervisor
 Unity of Direction - one manager per set of activities
 Subordination of Individual Interest to General Interest
 Remuneration of Personnel - fair price for services
 Centralization - reduce importance of subordinate’s role
 Scalar Chain - Fayol’s bridge
 Order - effective and efficient operations
 Equity - kindliness and justice
 Stability of Tenure of Personnel - sufficient time for familiarity
 Initiative - managers should rely on workers’ initiative
 Esprit de corps - ―union is strength‖ ―loyal members‖

EFFICIENCY VS. EFFECTIVENESS
Managerial Concerns
 Efficiency
―Doing things right‖
Getting the most
output for the least
inputs
 Effectiveness
―Doing the right things‖
Attaining
organizational goals

• Level in the organization
• Profit vs. not-for-profit
• Size of organization
• Transferability across national borders
• Making decisions & dealing with change
UNIVERSALITY OF MANAGER’S JOB

UNIVERSALITY OF MANAGER’S JOB
 Distribution of time
Source: Adapted from T. A. Mahoney, T. H. Jerdee, and S. J. Carroll,
“The Job(s) of Management.” Industrial Relations 4, no. 2 (1965), p.
103.
First Level Managers: Direct the day-to-day activities of subordinates
Middle Manager: Manage other managers; translate goals of top management
into details lower-level managers can perform
Top Manager: Establishes policies that affect all organization members

BBH 102 – Basics of Management Unit 1 Notes Jan 26 2018.pdf

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BBH 102 – Basics of Management Unit 1 Notes Jan 26 2018.pdf