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P R O F. S H A I L J A B H A K A R
Definitions of Management
• Consumer orientation
• Competition
• Entrance of new technologies
• Complexity of organization/ Specialization of jobs
• Growing interface between business and government
• Growth of trade union movement
Evolution of Management Theory
General Administrative School General Administrative theory grew out of the need to find
guidelines for managing such complex organizations as factories
I. Henri Fayol (1841- 1925) Generally called as the founder of management
1. Fayol believed that sound management practice falls into certain patterns that can be identified
and analyzed
2. Fayol listed 14 principles
3. He believed that managers could be taught once its underlying principles were understood
Principles of Management:
1. Division of labor
2. Authority and responsibility
3. Discipline
Evolution of Management Theory
4. Unity of command
5. Unity of direction
6. Subordination of individual interest to common good
7. Remuneration
8. Centralization and Decentralization
9. Scalar Chain
10. Order
11. Equity
12. Stability of staff
13. Initiative
14. Esprit de corps
Evolution of Management Theory
Human Relations School: Robert Owen: Scottish businessman who brought out
his first factory in 1789when he was just 18.
Repulsed the harsh practices he saw in factories such as:
1. Employment of young children
2. Thirteen hour workdays
3. Miserable working conditions
He proposed an idealistic workplace where:
1. Work hours would be regulated
2. Child labor would be outlawed
3. Public education would be provided
4. Meals at work would be furnished
5. Businesses would be involved in community projects
Evolution of Management Theory
Marry Parker Follett (1868-1933): Follett was convinced that no one could
become a whole person except as a member of a group
Human beings grow relationship in an organization with others.
In fact she called “ Management the art of getting things done through
people”
She believed that the artificial distinction between managers (order givers)
and subordinates (order takers) obscured their natural partnership
She was a great believer of power of the group, where individuals can
combine their diverse talents into something bigger
In Follett’s holistic model of control she not only accounted individuals and
groups but also environmental factors such as political, economical and
biological
She paved the way for management theory to include a broader set of
relationships, some inside the organizations and some across the borders
Evolution of Management Theory
The major contribution to human relations school grew out of a series of studies
conducted at the western electric company from 1924 to 1933. These were known as
“Hawthorne Studies”. “Western Electric Hawthorne Plant Near Chicago”
I. Hawthorne Effect: Elton Mayo and Colleagues
1. The Illumination Studies: experimental group and control group (Lighting Conditions)
2. The relay room experiment: rest breaks, length of workday and method of payment
3. The Bank wiring experiment: natural work situation
Implication of Hawthorne Studies
1. Small Group
2. Type of supervision
3. Earnings
4. Novelty of the situation
5. Interest in the experiment
6. Attention received in the test room
Evolution of Management Theory
Mayo and his colleagues pioneered the use of the scientific method in their studies of
people in the work environment.
Human relations approach is a social psychological approach and suggests
business enterprise is a social system in which group norm plays a significant role
Elton Mayo, Marry Parker Follet, Chester Bernard etc. were main contributors that
led to the development of human relations movement.
3. The group determines the norms of behavior for the group members and thus exercise a
great influence on the attitude and performance of workers
4. This approach focused on teaching people management skills (as opposed to technical
skills)
5. Conflicts should be removed by improving human relations in the organization
6. Informal organizations also exist in formal organizations it effects and is effected by
formal organization.
7. According to this approach managers should understand human relations.
Management as a Science:
1. Management is developed as systematized body of knowledge which can be
learnt, taught and researched
2. It uses scientific method of observation, experimentation and laboratory research
3. Management is a social science because it deals with behavior
Management as an Art
1. Application of management is an art
2. Principles of management are used as guide for solving problems
Nature of Management
Management as a Profession
1. According to Mc Farland a profession has following characteristics:
i. A body of principles, techniques, skills and specialized knowledge
ii. Formalized method of acquiring, training and experience
iii. The establishment of representative organization with professionalization as its
goal
iv. The formalization of ethical code for the guidance of conduct
v. The charging of fees based on the nature of services
Functions of Management
Management is social process as it takes its inputs from and exports its outputs to the society
Management is a process also because management functions are performed in continuity with each other
Management process comprises of following six fundamental functions:
1. Planning: Planning is deciding in the present about the future objectives and the courses of action for
their achievement. It thus involves:
a. Determination of long and short term objectives
b. Development of strategies and courses of actions
c. Formulation of policies, procedures, rules etc.
2. Organizing: Determining how best to group activities and resources. It thus involves
a. Identification of activities required for the achievement of objectives and implementation of plans.
b. Grouping of activities
c. Assignment of jobs to employees
d. Delegation of authority
e. Establishment of a network of coordinating relationship.
Functions of Management
Staffing: After the organizing step the next step is to procure suitable personnel for carrying out
the jobs
1. Determining the number and kind of personnel required
2. Recruitment
3. Selection
4. Placement, induction and orientation
5. Transfer, Promotion, termination and layoff
6. Training and development
Directing: Directing is the function of leading the employees to perform efficiently and
effectively and contributing at optimum level for the achievement of organizational objectives
1. Communication
2. Motivation
3. Leadership
Functions of Management
Top Management: Top managers manage the overall organization titles found
in this group include President, Vice President, Chief Executive Officers,
Managing Directors etc. Functions performed by top management are as follows:
1. Lays down the objectives of the enterprise
2. Prepares strategic plans and policies for the organization
3. Issues necessary instructions for preparation of departmental budgets,
schedules, procedures etc
4. Appoints executives at middle level
5. Coordinates activities of all departments
6. Controls activities of all departments
7. Builds and maintains relations with the outside public
8. Officially represents organizations to outside environment
Levels of Management
Technical Skills
Interpersonal Skills
Conceptual Skills
Diagnostic Skills
Decision Making Skills
Communication Skills
Time Management Skills
Team Building Skills
Leadership Skills