2 Concept of Management

Dr.Shafali Nagpal

1.1  Learning Objective

1.2  Introduction

1.3  Definitions

1.4  Principles of Management

1.5  Levels of Management

1.6 Nature of Management

1.7 Scope of Management

1.8 Summary

Learning Objective

After completing this module, you will be able to:

1. To understand about management fundamentals

2. To inculcate professionalism in management practices

3. To get knowledge of management functions and applications

Introduction

A more elaborate definition given by George R. Terry. He defines management as a process “consisting of planning, organizing, actuating and controlling, performed to determine and accomplish the objectives by the use of people and resources.” Firstly it considers management as a “process,” i.e. a systematic way of doing things. Secondly, it states four management activities: Planning, organizing, actuating, and controlling. Planning is thinking of actions in advance. Organizing is coordination of the human and material resources of an organization. Actuating is motivation and direction of subordinates. Controlling means the attempt to ensure no deviation from the norm or plan. Thirdly it states that manager uses people and other resources. For example, a manager who wants to increase the sales might try not only to increase the sales force but also to increase advertising budget. And fourthly, it states that management involves the act of achieving the organization’s objectives.

Concept

Definitions

“Management is the art of getting things done through others.” Follett describes management as an art of directing the activities of other persons for reaching enterprise goals. It also suggests that a manager carries only a directing function.

–Mary Parker Follett:

Harold Koontz:

“Management is the art of getting things done through and with people in formally organized groups.” Koontz has emphasized that management is getting the work done with the co-operation of people working in the organization.

J.D. Mooney and A.C. Railey:

“Management is the art of directing and inspiring people.” Management not only directs but motivates people in the organization for getting their best for obtaining objectives.

As per the above-mentioned definitions, management is the art of getting things done through people who may be managers or non-managers. At the level of chief executive, the work is getting done through functional managers, at the middle level the things are implemented through supervisors and at a lower level of management through workers. Human and technical skills play an important role in getting things done. These definitions represent the traditional viewpoint of management while workers are treated as a factor of production only. They are paid wages for doing their work.

Source: https://www.managementstudyguide.com/management_functions.htm

Management involves characteristics of both art and science. While certain aspects of management make it a science, certain others which involve the application of skills make it art. Every discipline of art is always backed by science which is basic knowledge of that art. Similarly, every discipline of science is complete only when it is used in practice for solving various kinds of problems. Whereas under “science” one normally learns the “why” of a phenomenon, under “art” one learns the “how” of it. In the words of Robert H. Hilkert: “In the area of management, science and art are two sides of the same coin”.

Management as an Art

Management can be an art in the sense that it has the following characteristics:

• Just like other arts it has to be practised and performed. The knowledge should be learned and practised, just as medical or legal practitioners practice their respective sciences.
• The manager gains experience by continual application of management knowledge and facing new experiences. This helps to develop more skills and abilities for translating knowledge into practice.
• Application calls for innovativeness and creativity.
• The fourth reason is that in many situations, theoretical knowledge of management may not be adequate or relevant for solving the problem. It may be because of complexity or unique nature of the problem.
• The art is in knowing how to accomplish the desired results. This implies that there exists a body of knowledge which management uses to accomplish the desired results in organization

Management as a Science

Management as a science has the following characteristics:

• Its principles, generalizations and concepts are systematic. In this case, the manager can manage the situation or organization systematically and scientifically.
• Its principles, generalizations and concepts are formulated by observation, research, analysis and experimentation, as is the case with the principles of other sciences.
• Like other sciences, management principles are also based on the relationship of cause and effect. It states that same cause under similar circumstance will produce the same effect. Suppose if workers are paid more (cause), the produce more (effect).
• Management principles are codified and systematic, and can be transferred from one to another and can be taught.

Management principles are universally applicable to all types of organizations.

There is no tailor-made answer to a question- Is management science or art? To ascertain the nature of management concerning science or art, there is a need to know the exact meaning of the words ‘science’ or ‘art’ and subsequently, their application to management.

Management: A profession?

The following criteria identify the status of a profession to management:

• The profession is a body of specialized knowledge.
• Professional knowledge in systemized and codified form can be learned through the formal education system.
• A profession emphasizes on having a central body to formulate a code of behaviour for its members.
• A profession calls for rendering competent and specialized services to clients.
• A profession maintains the scientific attitude and commitment for discovering new ideas and upgrading to improve quality of service and level of efficiency provided to clients.

A profession requires members to exercise restraint and self-discipline.

Management knowledge meets the first two criteria because it has grown into a systematic body of knowledge and also it can be acquired and learned through the formal education.

There is no minimum qualification prescribed either for getting an entry in the management profession or for becoming members of it. In practice, whosoever manages known as a manager, irrespective of qualifications. Peter Drucker in support of this view says that “no greater damage could be done to our economy or our society than to attempt to professionalize management by licensing managers, for instance, or by limiting access to management to people with a special academic degree.”

Regarding professional approach, a manager has to continuously strive for discovering new ideas, relationships and concepts and act in a dynamic and innovative manner to cope with the changing environment. Even so, managers are not respected as other professionals like doctors, advocates and chartered accountants.

There are five concepts of management. They are:

1.  Functional concept

Management is the task of planning, coordinating, motivating and controlling the efforts of other towards the goals and objectives of the organization. According to this concept, management is what a manager does (planning, executing, and controlling)

2. Human relation concept

According to this concept, Management is the art o getting things done through and with people in organized groups. It is the art of creating an environment in which people can perform, and individuals could cooperate towards attaining of group goals. It is an art of removing blanks to such performance a way of optimizing efficiency in reaching goals.

3. Leadership and decision-making concept

According to this concept, management is the art and science of preparing, organizing, directing human efforts applied to control the forces and utilize the materials of nature for the benefits to man.

4. Productive concept

According to this concept, management may be defined as the art of securing maximum prosperity with a minimum effort to secure maximum prosperity and happiness for both employer n employee and provide best services thereby.

5. Integration concept

According to this concept, management is the coordination of human and material resources towards the achievement of organizational objectives as well as the organization of the productive functions essential for achieving stated or accepted economic goal.

This above definition of management, given by different writers and authorities, are found giving different senses. Virtually, the five concepts are found developed by the authorities emphasizing in different aspects. However, it has been realized by many that it will not be fair to define management based on any one aspect. Management can be taken as a process-managerial process or social process either engage in planning, organizing, staffing, directing and controlling or mobilizing the group activities to achieve the corporate goals.

PRINCIPLES OF MANAGEMENT

A principle is a fundamental truth about a phenomenon which explains and establishes a cause-effect relationship. These principles are derived from observation, experiments, experience and analysis of events. These principles serve as guides to thought and action. A body of interrelated principles dealing with the same subject matter constitutes a theory thus the theory of management consists of some principles, duly recognized and systematized and concerned with the management of an organization.

Management principles are stat elements of truth that explain and establish a cause-effect relationship between various variables and enable a manager to perform the functions successfully and serve as guides to run the organization properly; these principles are practical guidelines for managerial thinking decision-making and action behaviour.

Management principles are universal and apply to all types of organization business or non-business government or private enterprises.

Management principles are flexible and not rigid. They are capable of adapting to every need. They can be modified as per requirements of the situation and environment, through providing useful guidelines for future course of action

Many management principles are not standardized. They are concerned with human behaviour, which is not standardized and is highly unpredictable. So management principles hold good in a large number of situations and need to be modified in specific conditions. That is why the management is regarded as inexact of a soft science.

Management principles are not only descriptive but are predictive or normative also

Management principles are equally significant. No principle can be said to have greater importance than the other

Some thinkers, philosophers and practitioners have contributed to the evolvement of principles of management during the 19th and 20th century, but two prominent names among the pioneers are F M Taylor and Henri Fayol.

5 Functions of Management

Effective management and leadership involve creative problem solving, motivating employees and making sure the organization accomplishes objectives and goals. There are five functions of management and leadership: planning, organizing, staffing, coordinating and controlling. These functions separate the management process from other business functions such as marketing, accounting and finance.

Planning

The planning function of management controls all the planning that allows the organization to run smoothly. Planning involves defining a goal and determining the most effective course of action needed to reach that goal. Typically, planning involves flexibility, as the planner must coordinate with all levels of management and leadership in the organization. Planning also involves knowledge of the company’s resources and the future objectives of the business.

Organizing

The organizing function of leadership controls the overall structure of the company. The organizational structure is the foundation of a company; without this structure, the day-to-day operation of the business becomes difficult and unsuccessful. Organizing involves designating tasks and responsibilities to employees with the specific skill sets needed to complete the tasks. Organizing also involves developing the organizational structure and chain of command within the company.

Staffing

The staffing function of management controls all recruitment and personnel needs of the organization. The main purpose of staffing is to hire the right people for the right jobs to achieve the objectives of the organization. Staffing involves more than just recruitment; staffing also encompasses training and development, performance appraisals, promotions and transfers. Without the staffing function, the business would fail because the business would not be properly staffed to meet its goals.

Coordinating

The coordinating function of leadership controls all the organizing, planning and staffing activities of the company and ensures all activities function together for the good of the organization. Coordinating typically takes place in meetings and other planning sessions with the department heads of the company to ensure all departments are on the same page in terms of objectives and goals. Coordinating involves communication, supervision and direction by management.

Controlling

The controlling function of management is useful for ensuring all other functions of the organization are in place and are operating successfully. Controlling involves establishing performance  standards and  monitoring  the  output  of employees  to  ensure  each  employee’s

performance meets those standards. The controlling process often leads to the identification of situations and problems that need to be addressed by creating new performance standards. The level of performance affects the success of all aspects of the organization.

Levels of management

To go on a deeper level, management can be defined as art and skill of getting things done through others is called management. George R Terry gives more elaboration. According to Terry-“management is the distinct process consisting of planning, organizing, activating, and controlling activities performed to determine and accomplishes the objectives by the use of people and resources.” If we give our attention towards the definition, we find that terry perceives the management as a process a systematic way of doing things. The four management activities are included in the process, and they are planning, organizing, activating and controlling.

MANAGEMENT = MANAGE+MEN+T (TACTFULLY)

Most organizations have three management levels:

• Low-level managers;
• Middle-level managers; and
• Top-level managers.

These managers are classified in a hierarchy of authority and perform different tasks. In many organizations, the number of managers in every level resembles a pyramid.

Below, you’ll find the specifications of each level’s different responsibilities and their likely job titles.

Top-level managers

The board of directors, president, vice-president, and CEO are all examples of top-level managers.

These managers are responsible for controlling and overseeing the entire organization. They develop goals, strategic plans, company policies, and make decisions in the direction of the business.

Also, top-level managers play a significant role in the mobilization of outside resources.

Top-level managers are accountable to the shareholders and the general public.

Middle-level managers

General managers, branch managers, and department managers are all examples of middle-level managers. They are accountable to the top management for their department’s function.

Middle-level managers devote more time to organizational and directional functions than top-level managers. Their roles can be emphasized as:

Executing organizational plans in conformance with the company’s policies and the objectives of the top management;

• Defining and discussing information and policies from top management to lower management, and most importantly
• Inspiring and guiding low-level managers towards better performance.

Some of their functions are as follows:

• Designing and implementing effective group and intergroup work and information systems;
• Defining and monitoring group-level performance indicators;
• Diagnosing and resolving problems within and among work groups;
• Designing and implementing reward systems supporting cooperative behaviour.

Low-level managers

Supervisors, section leads, and foremen are examples of low-level management titles. These managers focus on controlling and directing.

Low-level managers usually have the responsibility of:

• Assigning employees tasks;
• Guiding and supervising employees on day-to-day activities; Ensuring the quality and quantity of production;
• Making recommendations and suggestions; and Upchanneling employee problems.
• Also referred to as first-level managers, low-level managers are role models for employees.

Thee managers provide:

• Basic supervision; Motivation;
• Career planning;
• Performance feedback; and Staff supervision.

Nature of Management

Goal oriented: The most important goal of all management activity is to accomplish the objectives of an enterprise. The goals should be realistic and attainable.

Supreme in thought and action: Managers set realizable objectives and then mastermind action on all fronts to accomplish them. For this, they require full support form middle and lower levels of management.

Group activity: All human and physical resources should be efficiently coordinated to attain maximum levels of combined productivity. Without coordination, no work would accomplish, and there would be chaos and retention.

Dynamic function: Management should be equipped to face the changes in business environment brought about by economic, social, political, technological or human factors. They must be adequate training so that can enable them to perform well even in critical situations.

Social science: All individuals that a manager deals with, have different levels of sensitivity, understanding and dynamism.

An important organ of society: Society influences managerial action and managerial actions influence society. Its manager’s responsibility that they should also contribute towards the society by organizing charity functions, sports competition, a donation to NGO’s etc.

The system of authority: Well-defined lines of command, a delegation of suitable authority and responsibility at all levels of decision-making. This is necessary so that each should what is expected from him and to whom he needs to report to.

Profession: Managers need to possess managerial knowledge and training, and have to conform to a recognized code of conduct and remain conscious of their social and human obligations.

Process: The management process comprises a series of actions or operations conducted towards an end.

Scope of Management

Although it is difficult to define the scope of management precisely, yet the following areas are included in it:

1. Subject-matter of management: Planning, organizing, directing, coordinating and controlling are the activities included in the subject matter of management.
2. Functional areas of management: These include:

Financial management includes accounting, budgetary control, quality control, financial planning and managing the overall finances of an organization.

Personnel management includes recruitment, training, transfer promotion, demotion, retirement, termination, labor-welfare and social security industrial relations.

Purchasing management includes inviting tenders for raw materials, placing orders, entering into contracts and materials control.

Production management includes production planning, production control techniques, quality control and inspection and time and motion studies.

Maintenance management involves proper care and maintenance of the buildings, plant and machinery.

Transport management includes packing, warehousing and transportation by rail, road and air.

Thus,

Summary : Management is a universal phenomenon

The very survival of human being down the ages have depended on his skill for managing the resources at his command. Management is relevant even to the personal life of an individual.

A successful man in any walk of life knows how to manage his affairs [i.e.] he is capable of getting the utmost out of his time, money, energy, and social connections.

A student, a businessman, a housewife and others know the art of management. But generally, the management means utilization of group effort. This effort is to accomplish for reaching a certain goal.

References

• Kootnz & O’Donnell, Principles of Management.
• J.S. Chandan, Management Concepts and Strategies.
• Douglas McGregor, The Human side of enterprise, McGraw Hill Company Inc., New York, 1960, pp.33-34.
• Gatewood, Taylor & Ferrell (1995), Management: Comprehension, Analysis, and Application.
• Arun Kumar and R. Sharma, Principles of Business Management. Sherlerkar and Sherlerkar, Principles of Management
• B.P. Singh, Business Management and Organizations
• Stephen P Robbins, David A Decanzo, Fundamentals of Management, 3rd Edition, Pearson Education, 2002.
• VSP Rao, V Hari Krishna, Management- Text and Cases, Excel Books, 2002.
• P CTripathi, P N Reddy, Principles of Management, 4th Edition, Tata McGraw- Hill, 2008.