MG 2351

PRINCIPLES OF
MANAGEMENT
UNIT 1
OVERVIEW OF MANAGEMENT

1.OVERVIEW OF MANAGEMENT
Learning Objectives
Define Managers And Management.
Explain What Managers Do.
Understanding management concepts
Characteristics of management
Functions of management

s
I
t
n
e
anagem

Getting
Getting work
work
done
done through
through
others
others

Efficiency
Efficiency
Effectiveness

Management
Organization
Two or more people who work together in a structured way to
achieve a specific goal or set of goals.
Goals
Purpose that an organization strives to achieve;
organizations often have more than one goals, goals are
fundamental elements of organization.
The Role of Management
To guide the organizations towards goal accomplishment

Definitions

Management refers to the tasks and activities involved in

directing an organization or one of its units thro planning,
organizing, leading, and controlling.

The process of reaching organizational goals by working with

and through people and other organizational resources.

Louis E Boone & David L Kurtz- The use of people and other
resources to accomplish objectives.

Mary Parker Follet- the act of getting things done through

people.

Frederick Winslow Taylor defines

Management as the art of knowing
what you want to do in the best
and cheapest way.

People responsible for

directing the efforts aimed
at helping organizations
achieve their goals.

- A person who plans,

organizes, directs and
controls the allocation of
human, material, financial,
and information resources
in pursuit of the
organizations goals.

TYPES OF MANAGERS
FIRST-LINE MANAGERS- often called supervisors
stand at the base of the managerial hierarchy
MIDDLE MANAGERS- heads of various departments
and organise human and other resources to achieve
organizational goals
TOP MANAGERS- set organizational goals, strategies
to implement them and make decisions

CONTD.

 Function: A classification referring to a group

of similar activities in an organization like
marketing or operations.

Functional Managers: A manager responsible

for just one organizational activity such as
accounting, human resources, sales, finance,
marketing, or production
Focus on technical areas of expertise
Use communication, planning and
administration, teamwork and selfmanagement competencies to get work
done

 General Managers: responsible for the operations of

more complex unitsfor example, a company or
division
Oversee work of functional managers
Responsible for all the activities of the unit
Need to acquire strategic and multicultural
competencies to guide organization

Many Other types of managers

Basic Managerial Functions

Organizing

Leading
(Staffing & Directing)

Planning

Controlling

WHAT MAKE MANAGERS

SUCCESSFUL?

Hard work
Smart work
Patience
Out of box thinking
Reading and acquiring knowledge
Ethical consciousness
Collaborative relationship
Perseverance

Management and
Organizational Resources

Management Roles
Based on a study, Henry Mintzberg concluded
that managers performed 10 different roles.
These ten roles can be grouped into:

1. Interpersonal Roles
2. Informational Roles
3. Decisional Roles

What Managers Do
Managers

Individuals who achieve goals

through other people.

Organization

A consciously coordinated social

unit, composed of two or more
people, that functions on a
relatively continuous basis to
achieve a common goal or set of
goals.

Interpersonal Roles
Role

Description

Examples

Figurehead

Symbolic head; required to

perform a number of routine
duties of a legal or social
nature

Ceremonies status
requests, solicitations

Leader

Responsible for the motivation

Virtually all managerial

activities involving
subordinates.

and direction of subordinates

Liaison

Maintains a network of outside Acknowledgment of mail

contacts who provide favors
external board work
and information

Informational Roles
Role

Description

Examples

Monitor

Receives wide variety of

information; serves as nerve
center of internal and external
information of the organization

Handing all mail and

contacts categorized as
concerned primarily with
receiving information

Disseminator

Transmits information received

from outsiders or other
subordinates to members of the
organization

Forwarding mail into

organization for information
purposes; verbal contacts
involving information flow to
subordinates such as
review sessions

Spokesperson

Transmits information to
outsiders on organizations
plans, policies, actions, and
results; serves as expert on
organizations industry

Board meeting; handling

contacts involving
transmission of information
to outsiders

Decisional Roles
Role

Description

Examples

Entrepreneur

Searches organization and its

environment for opportunities
and initiates projects to bring
about change

Strategy and review

sessions involving initiation
or design of improvement
projects

Disturbance
handler

Responsible for corrective

action when organization faces
important, unexpected
disturbances

Strategy and review

sessions involving
disturbances and crises

Resource
allocator

Making or approving significant

organizational decisions

Scheduling ; requests for

authorization; budgeting,
the programming of
subordinates work

Negotiator

Responsible for representing

the organization at major
negotiations

Contract negotiation

MANAGERIAL SKILLS

HUMAN

TECHNI
CAL

CONCEPTUAL

TECHNICAL SKILLS
A persons knowledge and ability to make effective
use of any process or technique constitutes his
technical skills.
For eg: Engineer, accountant, data entry operator,
lawyer, doctor etc.

HUMAN SKILLS
An individuals ability to cooperate with other
members of the organization and work effectively
in teams.
For eg: Interpersonal relationships, solving peoples
problem and acceptance of other employees.

CONCEPTUAL SKILLS
Ability of an individual to analyze complex situations
and to rationally process and interpret available
information.
For eg: Idea generation and analytical process of
information.

EVOLUTION OF MANAGEMENT THOUGHT

I. Pre-Scientific Management Era
II. Scientific Management Era
- F.W.Taylor Henri Fayol
Henry Lawrence Gantt
III. Human Relations Era
-Mary Parker Follet
-Elton Mayo
IV. Social Science Era
-Chester I.Bernard
-Rensist Likert
-McGregor
V. Management Science Era
Herbert A. Simon, Peter F. Ducker
VI. Management Thought Today

[contd]

To enhance Productive efficiency of each worker - Principles

to be followed
1)Science not rule of thumb
2) Harmony not discord.
3) Co-operation not individualism
4) Maximum output in place of restricted output.
5)Development of each man to his greatest efficiency
&prosperity.
6)Equitable division of work and responsibility between
management and labour.

I.PRE SCIENTIFIC MANAGEMENT ERA

I. Ever Since Down Of civilization.
-Administration of Mohenjo-Daro & Harappa Cities Of ancient
Aryan in 2000 B.C.
-Buddha order and the sangha
-Organizations of public life in ancient Greece.
Organization of roman catholic church.
Organization of military forces.

SECOND HALF OF NINETEENTH CENTURY

Use of management Principles in business.
Robert Owen-1813 :-Development of mgmt. Concepts.
Factor which influence the productivity of personnel in plants.

II.SCIENTIFIC MANAGEMENT ERA

1.F.W Taylor Industrial Engineers.

FATHER OF SCIENTIFIC MANAGEMENT MOVEMENT

Emphasized the need for scientific approach to
management of business org:
Courses Of Law Efficiency of Workers
Lack of Knowledge on the part of management should
be done by workers in a day.

To enhance Productive efficiency of each worker-Principles

to be followed
1) Science not rule of thumb
2) Harmony not discord.
3) Co-operation not individualism
4) Maximum output in place of restricted output.
5)Development of each man to his greatest efficiency
&prosperity.
6)Equitable division of work and responsibility between
management and labour.

Technique Developed -To implement these Principles

1)ELEMENT OF SCIENTIFIC MANAGEMENT
Method study, routing motion study,
time study ,fatigue study & role setting.
2)PLANNING OF INDUSTRIAL OPERATIONS
What How ,Where & When the work shall
be done .
3)Proper selection ,placement and training of workers by
a centralized personnel department

IMPROVEMENT IN METHODS OF WORK VIZ

i)Standardization of tools and equipment.

ii) Regulation of speeds of machines.
iii) Improvement of the work environment.
Introduction of functional organization

as
or
???

Management as an Art

Art refers to creative skills and talent

which people require to conduct certain
activities effectively.

Art is an Inborn talent. However it can be

refined through Learning and Practice.

Management is an Art due to the

following reasons:

1. Intelligence

3. Innovative

2. Initiative

4. Individual Approach

5. Application & Dedication

6. Result Oriented

Comparison :
Management as
As An art

As a Science

Based on Practice and

creativity.

Based on
Experimentation.

It is a theoretical body
of knowledge.

It is a systematized
body of knowledge.

Has Personalized
Application.

Has Universal
Application.

Organization & the

environmental factors

135

External and Internal

Environment
Internal
Environment

The Manager
General
Environment

Task
Environment
136

The External
Environment

337

Internal & External Environment classification:

Internal Environment
1.Resources
2.Capabilities
3.Culture
External Environment:
1.specific environment
a. Customers
b. Suppliers
c. Competitors
d. Pressure
Groups
2. General Environment
a. Economic conditions
c. Socio-cultural Conditions
e. Technological Conditions

b. Political/Legal Conditions
d. Demographic Conditions
f. Global conditions

External environment
External environment refers to
force and institutions outside
organization that potentially affect
an organizations performance
General and Specific Environment

External environmentSpecific Environment

Specific Environment that is directly
relevant to achievement of an orgs
goal
Customers,competitors,suppliers,press
ure groups
Economic conditions,political/legal
conditions,socio cultural conditions,
demographic conditions,technological
and Global conditions

Specific Environment
Customers

Customers:customers who absorbs

organizational outputs
They represent potential uncertainty to
an organization,Their taste can
change,they can become
dissatisfied with organizations
product or service

Specific Environment
Competitors:
Competitors: Organizations cannot
afford to ignore its competitors.
Managers must be prepared to
respond to competitors policies
regarding pricing new
products,services offered and
other incentives it is giving to
customers

Specific EnvironmentSuppliers
Suppliers:Any party that provides
input for the business. E.g financial
institutions are provider of money,
colleges are suppliers of human
resources
Managers need to have steady and and
reliable flow of inputs to meet the goals

Specific EnvironmentPressure groups

Pressure groups: Managers must

recognize the special interest
groups that attempt to influence
organization

General Environment
Economic conditions:
Economic conditions: It includes the
impact of economic factors like
Interest rates, changes in disposable
income and the stage of general
business cycle
e.g : when consumers incomes fall
their confidence about job security
declines,they will postpone
purchasing any thing that is not
necessary

General Environment
Political/legal conditions:
Political/legal conditions:
Federal,state and local government
influence what org can and cannot
do
Managers must adapt their practices
to the changing expectations of the
society and their life style

General Environment
Demographic Conditions:

Demographic Conditions: Trends in

the physical characteristics of
population such as gender,age,level
of education,income,geographical
location
Technological:It is changing the ways
the org are operating,so businesses
must address this issue and its
impact on performance of org.

General EnvironmentSocio-cultural Conditions

Managers must adapt their practices
to the changing expectations of the
society in which they operate.

48

General EnvironmentTechnological Conditions

The whole area of technology is
radically changing the fundamental
ways that organizations are
structured and the way that
managers manage.

49

General EnvironmentSocio-cultural Conditions

Managers must adapt their practices
to the changing expectations of the
society in which they operate.

50

General EnvironmentTechnological Conditions

The whole area of technology is
radically changing the fundamental
ways that organizations are
structured and the way that
managers manage.

51

General EnvironmentGlobal conditions

Globalization is one of the major
factors affecting managers and
organizations

52

TRENDS AND CHALLENGES

OF MANAGEMENT IN
GLOBAL SCENARIO

53

Workforce diversity
Changing employee expectation
International environment
Building organizational capabilities
Job design & organizational structure
Changing psycho-social system
Technological advance
Management of human relations
Changes in legal environment
Expanding globalisation

54

1.Workforce diversity
Changing the Way You Do Business
It refers to the way in which people in
a workplace are similar & different
from one another. in addition to the
characteristics protected by law,
other similarities & differences
commonly cited include background,
education, language skills,
personality & work role.
55

Advantages of Workforce
diversity

IMPROVE DECISION MAKING

IMPROVE TEAM PERFORMANCE
BETTER CONSUMER SERVICES
ENHANCE COMMUNICATION SKILLS
CREATIVITY & INNOVATION

56

2.Changing employee expectation

The managers has then to redraw
new methods of motivation such as
job design.
Ex: motivation of workers to deliver
their contribution towards the
accomplishment of organizational
goals.

57

3.INTERNATIONAL ENVIRONMENT
The Environment which
includes all the factors
and forces which are
external to the Business
organization such as
economic, socio-cultural,
legal demographic etc.
are known as
International
environment.
58

 In simple word International

Environment means the growth and
expansion of business to a larger
extent.
i.e. global all over the world.

59

4. Building organizational
capabilities
To acquire new skills, knowledge & to
evaluate environmental changes to
evaluate business strategies.

60

5. Job design & organizational

structure
Design with foreign concepts ex:
quality circle,TQM etc
i. Task Approach
ii.People Approach

61

6.Changing Psycho-Social
System
Management designed to perform its
work function.
But in future Human Participation will
be required.

62

7.Technological Advance
New jobs will be created and many
old jobs will become redundant

63

8.Management of human
relations
New generation of workforce
comprising educated will ask for
higher degree of participation.

64

9.CHANGING IN LEGAL
ENVIRONMENT
Increases changes in legal
environment necessary adjustments
have to be made.

65

10. Expanding Globalisation

66

Strategies for International

Business

67

International Management
Focuses on the operations of
international firms in host countries.
International businesses engage in
transactional across national
boundaries.

68

Multinational Corporation
(MNC)
Multinational Corporations have their
headquarters in one country but
operate in many countries.

69

Orientations
Ethnocentric Orientation The style of the foreign
operations is based on that of the parent company.
Polycentric Orientation The foreign subsidiaries are given
a great deal of managerial freedom.
Regiocentric Orientation The foreign operations are staffed
on a regional basis.
Geocentric Orientation The entire organization is viewed
as an interdependent system operating in many countries.

70

Strategies
Multinational corporations must give
weightage to two important factors
The need to make optimum
economic decisions on a global basis
Responsive to host country
differences

71

In order to fulfil the above two criteria the

MNCs may opt for any of the four strategy
Worldwide integration / Globalisation
Strategy
National responsiveness strategy
Regional responsiveness strategy
Multifocal strategy

72

Forms of International
Business
Exportation Exportation of goods and
services from parent country to host country.
Licensing agreement Licensing agreement
for producing goods in another country.
Management contracts The company
can engage in management contracts for
operating in foreign companies.
Joint Venture and Strategic Alliances
o One form of interaction is a joint venture with
the firm in the host country.
173

Wholly Owned Subsidiaries

o A wholly owned subsidiary is an
operation on foreign soil that is
totally owned and controlled by a
company with headquarters outside
the host country.
o In wholly owned subsidiary, the
production facilities are totally
owned by one company.
174

Challenges of Management
in Global Scenario
Language barriers
Selling and Marketing in foreign
markets
Attitudes of host governments
Communication and coordination
between
subsidiaries