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Introduction to Management

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Table of Contents

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Chapter 1- Management: An Overview .............................................................................4

Managerial Roles .............................................................................................................4
Functions of the Manager................................................................................................4
The Levels of Management.............................................................................................4
Types of Managers...........................................................................................................4
Managerial Skills .............................................................................................................4
Approaches to Management............................................................................................4
Chapter 2 - Evolution of Management Thought ...............................................................5
Management Approaches ................................................................................................5
Chapter 3 - Social and Ethical Responsibilities of Management....................................6
SOCIAL STAKEHOLDERS..........................................................................................7
Measuring Social Responsiveness ..................................................................................7
Social Audits ....................................................................................................................7
Types of Management Ethics..........................................................................................7
Factors influencing Ethical Behavior .............................................................................7
Ethical Guidelines for Managers.....................................................................................8
Tools for Ethical Management........................................................................................8
Chapter 4 - Fundamentals of Planning...............................................................................8
Types of Plans ..................................................................................................................8
Planning Process ..............................................................................................................8
Prerequisites of Effective Planning.................................................................................9
Chapter 5 Objectives ..........................................................................................................9
MBO Process....................................................................................................................9
Making MBO Effective...................................................................................................9
Chapter 6 - Strategies, Policies and Planning Premises...................................................9
Nature and Purpose of Strategies and Policies...............................................................9
Levels of Strategy ..........................................................................................................10
Strategic Planning Process ............................................................................................10
SWOT Analysis .............................................................................................................10
Porter's Five Forces Model............................................................................................10
Types of Strategies and Policies ...................................................................................10
Porter's Competitive Strategy........................................................................................11
Effective Implementation of Strategy...........................................................................11
Effective Planning Premises..........................................................................................11
Chapter 7 - Managerial Decision-making ........................................................................11
Managers as Decision Makers ......................................................................................11
Decision Making Process ..............................................................................................11
Types of Managerial Decisions.....................................................................................12
Decision Making Conditions (Certainty, Uncertainty and Risk)................................12
System approach to decision making ...........................................................................12
Group decision making..................................................................................................13

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Decision Making Techniques........................................................................................13

Chapter 8 - Fundamentals of Organizing.........................................................................13
Traditional perspective on organizing ..........................................................................13
Challenges to the traditional perspective......................................................................13
Open-system Characteristics .........................................................................................13
Factors Determining an Effective Span........................................................................14
Process of Organizing....................................................................................................14
Chapter 9 - Strategic Organization Structure .................................................................14
Organization manual should cotain ..............................................................................14
Departmentation can be done in four ways ..................................................................14
Matrix Stages..................................................................................................................15
Other Bases for Departmentation..................................................................................15
Strategic Business Units should have ...........................................................................15
Chapter 10 - Line and Staff Authority and Decentralization .......................................15
Power affects the organizational members in three ways ...........................................15
Different Types of Power..............................................................................................15
The following factors affect the organization's authority structure ............................15
Factors affecting delegation of authority......................................................................16
Chapter 11 - Effective Organizing and Organizational Culture ..................................16
Characteristics of corporate organizational culture .....................................................16
Chapter 12 - Human Resource Management and Staffing ...........................................16
HRM Process..................................................................................................................16
Sources of recruitment...................................................................................................17
Recruitment Process ......................................................................................................17
Selection Process............................................................................................................17
Chapter 13 - Performance Appraisal and Career Strategy...........................................18
Objectives of performance appraisal ............................................................................18
Four approaches for a formal appraisal ........................................................................18
Performance Rating Methods........................................................................................18
Performance Appraisal Process.....................................................................................18
Formulating Career Strategy .........................................................................................18
Chapter 14 - Organizational Change and Organization Development .......................19
Reasons for organizational change ...............................................................................19
Sources of Resistance to Change ..................................................................................19
Measures to Overcome Resistance to Change .............................................................19
Change Process ..............................................................................................................19
Organizational Development Process...........................................................................19
Approaches to Manager Development .........................................................................20
Sources of Organizational Conflict...............................................................................20
Managing Conflict .........................................................................................................20
Chapter 15 - Managing and the Human Factor..............................................................20
The Nature of People .....................................................................................................20
Behavioral Models.........................................................................................................21
Creative Process.............................................................................................................21
Techniques to Enhance Creativity ................................................................................21
Innovation occurs due to the following factors............................................................21

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Chapter 16 - Motivating Employees for Job Performance............................................21

Three elements of motivation........................................................................................21
Classification of Motivation Theories ..........................................................................22
Motivational Techniques ...............................................................................................22
Chapter 17 Leadership.....................................................................................................22
Key Elements of Leadership .........................................................................................23
Leadership Theories.......................................................................................................23
Chapter 18 - Managing Communications ........................................................................24
Communication process has eight basic components..................................................24
The Communication Flow in the Organization............................................................24
Barriers to Communication ...........................................................................................24
Gateways to Effective Communication........................................................................25
Chapter 19 - The Control Function...................................................................................25
Importance of Controlling.............................................................................................25
Levels of Control ...........................................................................................................25
Control Process ..............................................................................................................25
Types of Control ............................................................................................................25
Other forms of controls..................................................................................................26
Requirements for Effective Control..............................................................................26
Chapter 20 - Control Techniques ......................................................................................26
Major control systems....................................................................................................26
Financial Control............................................................................................................26
Budgetary Control..........................................................................................................27
Responsibility Centers...................................................................................................27
Inventory Control...........................................................................................................27
Chapter 21 - Productivity and Operations Management ..............................................27
Importance of operations management.........................................................................27
Operations Research Procedure ....................................................................................27
Chapter 22 - Direct Control versus Preventive Control ................................................27
Questionable assumptions for direct control................................................................27
Preventive control assumptions .................................................................................28
Chapter 23 - Management Information Systems ............................................................28
Attributes of information...............................................................................................28
Components of an information system.........................................................................28
Types of Information System........................................................................................28
Management Information Systems Functions...........................................................28
Chapter 24 - International Management..........................................................................29
Reasons for Going International ...................................................................................29
Japanese management....................................................................................................29
Three approaches towards international business........................................................29

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Functions of the Manager

1. Planning
2. Organizing
3. Staffing
4. Leading
5. Controlling

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Managerial Roles
1. Interpersonal roles
a. Figurehead
b. Leader
c. Liaison
2. Informational Roles
a. Recipient
b. Disseminator
c. Spokesperson
3. Decisional roles
a. Entrepreneur
b. Disturbance handler
c. Resource allocator
d. Negotiator

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Chapter 1- Management: An Overview

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The Levels of Management

1. Top management
2. Middle level management
3. Supervisory management

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Types of Managers
1. Top level managers
2. Middle level managers
3. First level managers
Managerial Skills
1. Technical skills
2. Human or interpersonal skills
3. Conceptual skills
4. Design skills
Approaches to Management
1. Case approach studies experiences through cases

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2. Interpersonal behavior approach focused on interpersonal behavior and individual

psychology
3. Group behavior approach Behavior of people in groups. Based on sociology and
social psychology.
4. Cooperative social system approach Interpersonal + Group behavior.
5. Social-technical systems approach production + office relation + relationship b/w
technical system and people.
6. Decision theory approach focus on decision making
7. Systems approach Open system + close system
8. Mathematical approach logical + mathematical symbol and relationships
9. Situational approach based on circumstances
10. Managerial roles approach Interpersonal + Informational + Decision roles
11. McKinsey's 7-S framework Strategy, structure, system, style, staff, shared values and
skills
12. Operational approach concepts from other fields + managerial approaches

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Chapter 2 - Evolution of Management Thought

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Management Approaches
1. Classical approach
a. Scientific management one best way to do each job
b. Administrative management one best way to put an organization together
c. Bureaucratic management Highly structured + formalized + Rational and
impersonal organizational
2. Behavioral approach from individual point of view + human element
a. Group influences power sharing + finding soln acceptable to group
b. Hawthorne studies
i. Illumination experiments outcome: group productivity not directly
related to illumination intenisty
ii. Relay assembly test room experiments outcome: Better treatment
of employees made them more productive
iii. Interview phase
iv. Bank wiring observation room experiments outcome: not increase in
production with money
c. Maslows needs theory
i. physiological needs
ii. safety or security needs
iii. belongingness or social needs
iv. esteem or status needs
v. Self-actualization, or self-fulfillment needs.
d. Theory X and Theory Y
e. Model I versus Model II values
3. Quantitative approach
a. Management science or Operations Research Maths + statistical method for
decision making

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b. Operations management management of production and timeliness of

deliveries
c. Management information system
4. Modern approaches
a. The Systems Theory
i. Inputs
ii. Transformation process or throughputs
iii. Output and
iv. feedback
b. Contingency Theory Situational theory
c. Theory Z and Quality management

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Fayols 14 principles of management

1. Division of work
2. Authority and responsibility
3. Discipline
4. Unity of command
5. Unity of direction activities come in 1 plan + 1 supervisor of activities
6. Subordination of individual interest to the general interest
7. Remuneration
8. Centralization
9. Scalar chain chain from top to bottom. Defines communication path of an org.
10. Order right person in right job + things kept at right place for co-ordination
11. Equity Employees treated equally
12. Stability of tenure of personnel
13. Initiative encourage employees to give suggestions
14. Espirit de corps team spirit, sense of union

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Chapter 3 - Social and Ethical Responsibilities of Management

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Environment
1. Internal
2. External
a. Mega Environment or general Environment
i. Social cultural component
ii. International component
iii. Technological component
iv. Economic component
v. Legal political component
b. Task Environment
i. Labor supply
ii. Suppliers
iii. Government agencies
iv. Customers/Clients
v. Competitors

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Measuring Social Responsiveness

1. Contributions
2. Fund-raising
3. Volunteerism
4. Recycling
5. Valuing diversity
6. Direct investment
7. Quality of work life
8. Attention to consumers
9. Pollution control

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SOCIAL STAKEHOLDERS
1. Internal Stakeholders
a. Shareholders
b. Employees
2. External stakeholders
a. Customers
b. creditors and suppliers
c. society
d. government

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Social Audits
1. Those required by the government
2. Voluntary social programs

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Types of Management Ethics

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1. Moral management follow ethics

2. Amoral management intentionally/un-intentionally ignores ethics
3. Immoral management ignores and opposes ethics

Factors influencing Ethical Behavior

1. Stages of moral development
a. Pre conventional
b. Conventional
c. Principled
2. Individual characteristics
a. Personal values
b. Ego strength
c. Locus of control
3. Structural variables
4. Organization culture
5. Situational Factors

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Tools for Ethical Management

1. Top management commitment
2. Code of ethics document containing org values and ethics
3. Ethics committee
4. Ethics audit
5. Ethics training
6. Ethics hotline

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Ethical Guidelines for Managers

1. Obeying the law
2. Tell the truth
3. Uphold human dignity
4. Adhere to the golden rule Do unto others as you would have others do unto you
5. Allow room for participation
6. Do no harm
7. Always act when you have responsibility

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Chapter 4 - Fundamentals of Planning

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Types of Plans
1. Organization level
a. Strategic plans
b. Tactical plan
c. Operational plans
2. Frequency of use
a. Single use plans
i. Program large scale + accomplish specific objectives
ii. Budgets
iii. Projects
b. Standing plan
i. Policies general boundaries for actions
ii. Procedures detailed step-by-step instructions regarding the action to
be taken
iii. Rules what should or should not be done.
3. Time frame
a. Short term plan up to 1 year
b. Medium term plan 1 - 5
c. Long-term plan 5+
Planning Process
1. Analyze opportunities
2. Establish objectives
3. Develop premises
4. Identify alternatives
5. Evaluation

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6. Selection
7. Implementation
8. Review

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Prerequisites of Effective Planning

1. Right climate
2. Clarity
3. Planning premises
4. Initiation at the top-level
5. Participating in planning process
6. Communication
7. Open system
8. Management information system

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Chapter 5 Objectives

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MBO Process
1. Develop organizational goals
2. Clarifying organizational roles
3. Establish specific goals
4. Formulate action plan
5. Implement and maintain self control
6. Periodic review
7. Performance appraisal
8. Recycling

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Making MBO Effective

1. Top management support
2. Training for MBO
3. Formulating clear objectives
4. Effective feedback
5. Encouraging participation

Chapter 6 - Strategies, Policies and Planning Premises

Nature and Purpose of Strategies and Policies
1. Direction
2. Framework for plans

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3. Need for operational planning

4. All perspective

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Levels of Strategy
1. Corporate level strategy identify the business in which org will operate
a. Value-based approach based on values beliefs and convictions of
managers and employees
b. Corporate portfolio approach evaluation of various business units by top
management
i. BCG Matrix
1. Question marks (problem children) MS-low, GR-high
2. Stars MS-high, GR-high
3. Cash cows MS-high, GR-low
4. Dogs MS-low, GR-low

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2. Business level strategy

3. Functional level strategy

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Strategic Planning Process

1. Define the mission
2. Develop objectives
3. Assess opportunities and threats
4. Formulate strategy
5. Implement strategy
6. Monitor and adopt strategic plans

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SWOT Analysis
1. Strength
2. Weakness
3. Opportunity
4. Threat

Porter's Five Forces Model

1. Rivalry
2. Bargaining power of customers
3. Bargaining power of suppliers
4. Threat of new entrants
5. Threat of substitutes products or services
Types of Strategies and Policies
1. Growth strategy
a. Concentration
b. Vertical integration

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c. Diversification
2. Stability strategy
3. Defensive strategy
a. Harvest strategy
b. Turnaround strategy
c. Divestiture strategy
d. Bankruptcy

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Porter's Competitive Strategy

1. Cost leadership
2. Differentiation
3. Focus

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Effective Implementation of Strategy

1. Communicate strategies
2. Develop and communicate planning premises
3. Develop organization culture
4. Monitoring
5. Develop contingency strategies and programs
6. Emphasize on planning and implementation
7. Create proper organizational climate

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Effective Planning Premises

1. Selection of premises
2. Develop alternative plans
3. Verify premises
4. Communicate premises

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Chapter 7 - Managerial Decision-making

Managers as Decision Makers
1. Rational model
2. Non-rational model
a. Satisficing model (Bounded Rationality)
b. Incremental model least effort to reduce the level of problem
c. Garbage-can model random decisions
Decision Making Process
1. Determining the problem
a. Scanning monitoring work environment for changes
b. Categorization understand performance gap
c. Diagnosis gather related facts and more info

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2. Identifying resources of constraints anything that can solve problem

3. Generate alternative solutions
4. Evaluating alternative solutions
a. Feasibility degree to which org can accomplish goals within constraints
b. Quality extent to which solution is effective
c. Acceptability degree of support from affected and choosers
d. Cost resources + side effects
e. Ethics compatibility with ethical standards
5. Selecting alternatives
a. Past experience
b. Experiment
c. Research
6. Implementing the decision
7. Monitoring

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Types of Managerial Decisions

1. Programmed decisions Low level + middle level
2. Non programmed decisions middle level + top level

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Decision Making Conditions (Certainty, Uncertainty and Risk)

1. Decision making under certainty alternative + conditions + outcomes are known
2. Decision making under risk alternative incomplete idea + good idea of outcome
3. Decision making under uncertainty future unpredictable + everything in flux, nothing
known
a. Modern Approach to Decision Making Under Uncertainty
i. Risk analysis analyze size and nature of risk
ii. Decision trees
iii. Preference or utility theory risk taking capability varies
1. risk averters
2. gamblers

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System approach to decision making

1. Management Information System (MIS)
a. Data gathering
b. Data entry
c. Data transformation
d. Info utilization
2. Decision Support System (DSS)
a. MIS
b. DB
c. GUI
d. DB with external and internal info
e. Rapid response time

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Group decision making

1. Interacting groups openly discuss + argue + agree on best alternative
2. Delphi group opinion of experts + taking their consensus + members dont meet
3. Nominal groups members meet + rank the alternatives + highest one wins

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Decision Making Techniques

1. Marginal analysis how much extra o/p if 1 more unit of variable added
2. Financial analysis estimate profitability + cash inflow + cash outflows
3. Break- Even analysis total revenue = total cost. Profit = nil
4. Ratio analysis
5. Operations research techniques practical application of quantitative methods in
decision making
a. Linear programming optimum allocation of scarce resources
b. Queuing or waiting-line method mathematical technique to balance services
provided and waiting lines
c. Game theory determine optimal course of action
d. Simulation build model to represent real problem
e. Decision tree trace the optimum path through tree diagram.

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Chapter 8 - Fundamentals of Organizing

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Traditional perspective on organizing

1. Unity of command
2. well defined hierarchy of Authority
3. Authority at par with Responsibility
4. Downward delegation of authority and not responsibility.

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Challenges to the traditional perspective

1. Bottom up theory acceptance theory of authority sub-ordinates willingness to
comply with leaders authority (cooperative systems)
2. Environmental complexity and uncertainty based on open system approach
Open-system Characteristics
1. Cyclical events
2. Negative entropy ability to repair and grow
3. Feedback
4. Dynamic homeostasis maintaining equilibrium
5. Differentiation specialized functioning among its components
6. Equifinality achieve objectives through different course of actions
Developing an open system model
1. Inputs

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Establish the objectives of the organization

Frame supportive objectives and policies
Identify and classify the objectives as per the organizational requirements
Group the activities, based on human resources, materials etc.
Delegate authority to groups
Organize the groups, both vertically and horizontally

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Process of Organizing

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Factors Determining an Effective Span

1. Training
2. Clarity and delegation of authority
3. Clarity of plans
4. Use objective standards
5. Rate of change
6. Communication techniques
7. Personal contact
8. Organizational levels
9. Use of staff assistance
10. Other factors

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2. Organization
a. Technical subsystem (production function) converts raw material into goods
b. Boundary spanning subsystem (interface function) consists of jobs that
require interaction of personnel with general environment
c. Managerial subsystem co-ordinate technical and boundary spanning
subsystems
3. Outputs

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Chapter 9 - Strategic Organization Structure

Organization manual should cotain
1. statement of org philosophy
2. charts
3. programs
4. outline of job descriptions
Departmentation can be done in four ways
1. Functional structure grouping based on functions (specialization) e.g. sales,
marketing,
2. Divisional structure groping based on product, service or markets
a. Product divisions
b. Geographic divisions

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c. Customer divisions
3. Hybrid structure functional + divisional
4. Matrix structure (grid or project or product management organization (PMO))
superimpose horizontal reporting relationship onto a hierarchical function structure.

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Strategic Business Units should have

1. Unique mission statement
2. well-defined competitors group
3. own integrated plans
4. manage its resources in key areas
5. a proper size

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Other Bases for Departmentation

1. Departmentation by simple numbers
2. Departmentation by time
3. Departmentation by process or equipment

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Matrix Stages
1. Tradition structure generally a functional structure
2. Temporary overlay managerial integrator positions established
3. Permanent overlay managerial integrators works on permanent basis
4. Mature matrix bosses have equal powers

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Chapter 10 - Line and Staff Authority and Decentralization

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Power affects the organizational members in three ways

1. Decision
2. Behavior
3. Situations
Different Types of Power
1. Legitimate power power by virtue of position
2. Expert power power derived from expertise
3. Referent power derives from desire to imitate e.g. film stars, cricketers
4. Reward power power to reward
5. Coercive power power to punish
The following factors affect the organization's authority structure
1. Organization's history
2. Managerial knowledge and experience

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Factors affecting delegation of authority

1. Delegator or the superior's aspect
a. Love for authority
b. Fear of subordinates advancement
c. Fear of exposure
d. Attitude towards subordinates
e. Personality traits and experiences of superior
2. Delegatee or the subordinate's aspect
a. Fear of criticism
b. Lack of information and resources
c. Lack of self-confidence
3. Organizational aspect

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Size of the organization

Geographical dispersion
Technical complexity of tasks
Views of the subordinates
Environmental influencers

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4.
5.
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Chapter 11 - Effective Organizing and Organizational Culture

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Characteristics of corporate organizational culture

1. Corporate culture is distinctive
2. Based on norms
3. Promotes dominant and stable values
4. Leads to observed behavioral regularities
5. Shapes philosophy and rules

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Chapter 12 - Human Resource Management and Staffing

HRM Process
1. Human resource planning
a. Forecasting manpower demand
b. Forecasting manpower supply
i. Internal labor supply
1. Skill inventory
2. Replacement planning
a. Managerial Inventory chart
i. Major managerial positions
ii. Current incumbents
iii. Potential replacement for each position

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Sources of recruitment
1. Internal Recruitment
2. External Recruitment
a. Advertising
b. Educational institutions
c. Employment agencies
d. Voluntary applicants
e. Referrals

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iv. Age of each person on chart

3. Succession planning
ii. External labor supply is affected by
1. demographic changes in population
2. national and regional economics
3. education level of workforce
4. demand for specific employee skill
5. population mobility
6. government policies
c. Human resource actions
Staffing
Training and development
Performance appraisal
Compensation

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Recruitment Process
1. Job analysis
a. Analyze the environment in which employees work
b. Determining duties and responsibility to be discharged
c. Observing and recording the various tasks as they are actually performed
2. Designing job description
a. Objectives of the job
b. The work to be performed
c. The skills needed
d. The responsibility needed
e. Relationship of the job to other jobs
f. Working conditions on the job
3. Identifying job specification document describing minimum expected qualification
4. Attract a pool of applicants
Selection Process
1.
2.
3.
4.
5.

Preliminary screening
Application blank
Selection tests
Comprehensive interviews
Reference checks

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6. Physical examination
7. Making the selection

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Chapter 13 - Performance Appraisal and Career Strategy

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Four approaches for a formal appraisal

1. A superior rating subordinates
2. Superiors rating subordinates
3. Group of peers rating a colleague
4. Subordinates rating the boss

Objectives of performance appraisal

1. Performance feedback
2. Performance improvement
3. Potential identification
4. Promotion decisions
5. Compensation administration
6. Work-force planning
7. Validation of selection procedures

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Performance Rating Methods

1. Graphic Rating scales rate on quality, quantity, punctuality, job knowledge etc.
2. Essay Method
3. Results or MBO Method
4. Behaviorally Anchored Rating Scales
a. Determination of relative job dimensions
b. Identification of behavioral anchors
c. Determination of the scale value to be used
Performance Appraisal Process
1. Comprehensive appraisal
2. Progress or periodic reviews
3. In Continuous monitoring
Formulating Career Strategy
1. Preparation of a Personal Profile
2. Development of long-range Personal and Professional Goals
3. Analyzing threats and opportunities
4. Analyzing strengths and weaknesses
5. Development of strategic career alternatives
6. Consistency Testing and Strategic Choices
7. Development of short-range career objectives and action Plans

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Chapter 14 - Organizational Change and Organization

Development

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8. Development of contingency plans

9. Implementation of the career plan
10. Monitoring progress

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Reasons for organizational change

1. Nature of workforce
2. Technology
3. Economic factors
4. Competition

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Sources of Resistance to Change

1. Individual resistance
a. Habits
b. Security
c. Economic factors
d. Fear of the unknown
e. Selective information processing
2. Organizational resistance
a. Structural inertia
b. Limited focus of change
c. Group inertia
d. Threat to expertise
e. Threat to established power relationships
f. Threat to established resource allocation

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Measures to Overcome Resistance to Change

1. Education and communication
2. Participation
3. Facilitation and support
4. Negotiation
5. Manipulation and co-optation buy-off the leader of opposition
6. Explicit and implicit coercion
Change Process
1. Unfreezing
2. Changing
3. Refreezing
Organizational Development Process
1. Diagnosis diagnosis of current situation to find deficiency
2. Intervention systematic attempt to correct an organizational deficiency diagnosed

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a. Process consultation concerned with interpersonal relations and functioning

b. Team building
c. Third party intervention
d. Survey feedback
e. Technostructural activities aimed to improving technology or org structure
f. Skill development
3. Evaluation

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Approaches to Manager Development

1. On-the-job training
a. Planned progression
b. Job rotation
c. Creation of assistant-to positions
d. Temporary promotions
e. Committees and junior board
f. Coaching
2. Internal and external training
a. Sensitivity training
b. Conference programs
c. University management programs
d. Readings
e. Business simulation, experimental exercise and expert systems

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competition for Scarce resources

Communication barriers
time pressure
unreasonable standards, goals and policies
personality clashes
ambiguous or overlapping jurisdiction
unrealized expectation

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Sources of Organizational Conflict

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Managing Conflict
1. Avoidance
2. Problem solving
3. Compromise
4. Forcing
5. Smoothing emphasize areas of agreement and common goals + de-emphasize areas
of disagreement

Chapter 15 - Managing and the Human Factor

The Nature of People
1. Individual differences
2. Personal dignity

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3. Multiple roles
4. considering the whole person

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1. EHS model of complex person

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a. Rational economic assumptions people motivated by economic incentives

b. Social assumptions motivated by social needs
c. Self-actualization assumptions motivated by own needs and motives
d. Complex assumptions people are complex and highly variable
2. Lyman Porters model of human nature (LP model)
a. Rational or emotional
b. Behaviorist or Phenomenological
c. Economic or Self-actualizing
3. McGregors Theory X and Theory Y
4. 3 managerial models by E.Miles
a. Traditional model managers as directors and controllers to get performance
b. Human relations model social and egoistic needs of individual
c. Human resources model managers should help subordinates to achieve goals

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Creative Process
1. Unconscious scanning
2. Intuition links unconscious state with conscious state
3. Insight largely result of hard work
4. Logical formulation testing the insights by logic or experimentation

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Techniques to Enhance Creativity

1. Brain storming
2. Synectics forming special groups

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Innovation occurs due to the following factors

1. Unexpected events
2. Incongruity between assumption and reality
3. Need for improvement of process or task
4. Environmental changes

Chapter 16 - Motivating Employees for Job Performance

Three elements of motivation
1. needs

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2. drives
3. goals

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Classification of Motivation Theories

1. Content (Need) Theories
a. Maslow's hierarchy of needs
i. Physiological needs food, clothing, shelter
ii. Safety needs job security, pension, LIC
iii. Social needs teamwork, love, affection
iv. Esteem needs respect and recognition pay hike, promotion
v. Self-actualization freedom to be creative challenging work
b. Herzberg's two-factor theory
i. Motivating factors job content factors
ii. Hygiene factors absence of job context factors
c. McClelland's need theory of motivation
i. Achievement need
ii. Need for affiliation
iii. Need for power
d. Alderfer's ERG theory
i. Existence
ii. Relatedness
iii. Growth
2. Process theories
a. Expectancy theory
i. Expectancy particular action would lead to expected performance
and outcome
ii. Instrumentality probability that successful performance would lead
to certain outcomes
iii. Valence value of outcomes
1. +ve strong desire for outcome
2. ve avoid outcome
3. 0 indifferent to outcome
b. Equity theory based on peoples sense of fairness and justice
Motivational Techniques
1. Rewards
2. Participation
3. Quality of work life
4. Job enrichment attempt to build higher sense of challenge and achievement

Chapter 17 Leadership

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Key Elements of Leadership

1. ability to use Power effectively and responsibly
2. Fundamental understanding of people
3. Ability to inspire followers
4. develop a harmonious work culture

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Leadership Theories
1. Trait theory
a. Physical characteristics (height and appearance)
b. Skills and ability (intelligence)
c. Personality characteristics (extrovert)
d. Social factors (interpersonal factors)
2. Behavioral theory
a. Iowa studies autocratic, democratic and laissez-faire
b. Michigan studies employee centered approach was more useful compared to
job or production centered approach
c. Ohio studies
i. Initiating structure leader defining his and subordinates roles to meet
org goals
ii. Consideration mutual trust b/w leader and subordinates
d. Likert's four system of management
i. Exploitive-authoritative dictatorial leadership behavior
ii. Benevolent-authoritative
iii. consultative approach
iv. Participative leadership most successful
e. Managerial grid
i. The impoverished style people low, production - low
ii. The country club style people high, production - low
iii. The produce or perish style people low, production - high
iv. The middle-of-the-road style people = production
v. The team style people high, production - high
3. Situational theory
a. Fiedler's contingency approach to leadership
i. Dimensions of leadership situation
1. Position power
2. The task structure
3. Leader member relations
ii. Style of leadership
1. Task oriented
2. employee oriented
iii. 2 innovative testing techniques to find type of leader
1. Scores on least preferred co-worker (LPC) scale indicate
person with whom they would least likely to work with
2. Scores on assumed similarities between opposites (ASO) scales
degree to which leader identify group members like himself

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b. Path-goal theory explains how a leader can help subordinates achieve goals
i. Instrumental Leadership provide clear guide lines to subordinates
ii. Supportive Leadership creating a pleasant org climate
iii. Participative Leadership participation in decision-making and
encouraging suggestion
iv. Achievement-oriented Leadership setting formidable goals to help
employees perform their best
c. Vroom theory
i. Autocratic I
ii. Autocratic II
iii. Consultative I
iv. Consultative II
v. Group participation
d. Hersey and Blanchard's theory
i. Telling
ii. Selling
iii. Participating
iv. delegating
4. Transformational theory
a. Charismatic leadership
b. Individual consideration
c. Intellectual simulations

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Chapter 18 - Managing Communications

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Communication process has eight basic components

1. Sender
2. Encoding
3. Message
4. Medium
5. Receiver
6. Decoding
7. Noise
8. Feedback
The Communication Flow in the Organization
1. Vertical communication
a. Downward communication
b. Upward communication
2. Horizontal communication
3. Crosswise communication
Barriers to Communication
1. Individual barriers

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Gateways to Effective Communication

1. Individual skills
a. Develop good listening skills
b. Encourage two-way communication
c. Clarity in language and meaning
2. Organizational skills
a. Follow up
b. Regulate information flow

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a. Inconsistent cues
b. Credibility
c. Reluctance
d. Predisposition
e. Communication gap
2. Organizational barriers
a. Semantic
b. Perception
c. Overload

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Chapter 19 - The Control Function

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Importance of Controlling
1. Coping with uncertainty
2. Detecting irregularities
3. Identifying opportunities
4. Handling complex situations
5. Decentralizing authority
6. Minimizing costs

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Levels of Control
1. Strategic control
2. Tactical control
3. Operational control
Control Process
1. Determining areas to control
2. Establishing performance standards
3. Measuring actual performance
4. Comparing measured performance against established standards
5. Taking corrective action when necessary
6. Adjusting standards and measures
Types of Control
1. Feed forward Control inputs are monitored to ensure that they meet the standard
necessary fir the transformation process

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2. Concurrent Control regulates on going activities

3. Feedback Control exercised after a product or service has been produced

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Requirements for Effective Control

1. Controls systems should reflect planning
2. They should be understandable
3. Cost effective
4. Controls should focus attention on critical areas
5. Flexible
6. Multidimensional
7. Timeliness
8. Accuracy

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Other forms of controls

1. Cybernetic control system self regulating control system do away with people
2. Non-cybernetic control relies on human discretion

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Major control systems

1. financial control system
2. budgetary control system
3. quality control system
4. inventory control system
5. operations management
6. computer based information system

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Financial Control
1. Financial Statements
2. Balance sheets snapshot of financial position of org
a. Assets
1. current assets
2. fixed assets
b. Liabilities
c. Net worth
3. Income statements summarizes companys financial performance over a given
interval of time
4. Cash flows statements sources and uses of funds statements
5. Ratio analysis
a. Liquidity ratio ability to meet short term obligations by using its current
assets
b. Asset management ratio (activity ratios) effectiveness of org in managing its
assets
c. Debt management ratio % of total assets financed by debts

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Budgetary Control
1. Presentation of overall managerial view
2. Narrows down the gap between planning and performance
3. Promotes division of work and specialization
4. Fosters coordination and integration

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d. Profitability ratio gross profit margin, net profit margin and ROI

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Inventory Control
1. Raw materials inventory
2. Work-in-progress inventory
3. Finished goods inventory

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Responsibility Centers
1. Standard cost centers have fixed cost to perform a job HR dept
2. Discretionary expense centers expenses at managers discretion R&D
3. Revenue centers control only on revenue through sales marketing and sales
4. Profit centers performance calculated as revenue - expenditure
5. Investment center based on ROI

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Chapter 21 - Productivity and Operations Management

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Importance of operations management

1. Capacity decisions
2. Facilities decisions
3. Workflow and technology decisions
4. Materials and inventory decisions
5. Quality decision

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Operations Research Procedure

1. Formulating the problem
2. Constructing a mathematical model
3. Deriving a solution from the model
4. Testing the model
5. Establishing controls over the solution
6. Implementing the solution

Chapter 22 - Direct Control versus Preventive Control

Questionable assumptions for direct control
1. Performance can be measured
2. Personal responsibility exists
3. Time expenditure is warranted
4. Mistakes can be discovered in time

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Preventive control assumptions

1. The application of the fundamentals of management can be evaluated
2. Qualified managers do not err much
3. Managerial performance

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5. Correction will be done by assigned person

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Attributes of information
1. Accuracy
2. Timeliness
3. Relevance
4. Completeness
5. Frequency
6. Time horizon
7. Scope
8. Origin
9. Form of presentation

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Chapter 23 - Management Information Systems

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Components of an information system

1. Hardware
2. Software
3. Data
4. Procedures
5. Personnel

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Types of Information System

1. Transaction processing system
2. Office automation systems
3. Decision support systems
4. Executive support
5. Management information system
Management Information Systems Functions
1. Data collection
2. Store and process data
3. Present information to managers

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Chapter 24 - International Management

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Japanese management
1. Life-time employment
2. Seniority system
3. Continuous training
4. Emphasis on group work
5. Decision making
6. Complicated performance evaluation
7. Good benefits for employees
8. Simple and flexible organization

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Reasons for Going International

1. Aggressive
a. Venture into new markets
b. Generate more profits
c. Acquire raw-materials for home markets
d. Management decision to opt for globalization
2. Defensive
a. Protect domestic markets
b. Protect foreign markets
c. Guaranteeing the supply of raw materials and acquiring technology and knowhow
d. Seek political stability

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Three approaches towards international business

1. Ethnocentric approach same pricing policy through out the world
2. Polycentric approach prices fixed by regional managers
3. Geocentric approach medium position from 1 & 2 above

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