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Introduction to Management and Economics

Dr. V Mamtha
Assistant Professor,
Dept. of Mechanical Engineering,
RVCE, Bangalore -59

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V & VI Semester
INTRODUCTION TO MANAGEMENT & ECONOMICS
(THEORY)
Course Code : 18HEM51 / 61 CIE : 100 Marks
Credits: L:T:P : 3:0:0 SEE : 100 Marks
Total Hours : 39L SEE Duration : 03 Hrs
Course Learning Objectives: The students will be able to
1 Understand the evolution of management thought.
2 Acquire knowledge of the functions of Management.
3 Gain basic knowledge of essentials of Micro economics and Macroeconomics.
4 Understand the concepts of macroeconomics relevant to different organizational contexts.

Unit-I 07 Hrs
Introduction to Management: Management Functions, Roles & Skills, Management History – Classical Approach: Scientific Management & Administrative Theory, Quantitative Approach:
Operations Research, Behavioral Approach: Hawthorne Studies, Contemporary Approach: Systems & Contingency Theory.Case studies
Unit – II 09 Hrs
Foundations of Planning: Types of Goals & Plans, Approaches to Setting Goals & Plans, Strategic Management Process, Corporate & Competitive Strategies. Case studies
Organizational Structure & Design: Overview of Designing Organizational Structure: Work Specialization, Departmentalization, Chain of Command, Span of Control, Centralization &
Decentralization, Formalization, Mechanistic & Organic Structures.Case studies
Unit –III 09 Hrs
Motivating Employees: Early Theories of Motivation: Maslow’s Hierarchy of Needs Theory, McGregor’s Theory X & Theory Y, Herzberg’s Two Factor Theory, Contemporary Theories of
Motivation: Adam’s Equity & Vroom’s Expectancy Theory. Case studies
Managers as Leaders: Behavioral Theories: Ohio State & University of Michigan Studies, Blake & Mouton’s Managerial Grid, Contingency Theories of Leadership: Hersey & Blanchard’s
Situational Leadership, Contemporary Views of Leadership: Transactional & Transformational Leadership. Case studies
Unit –IV 07 Hrs
Introduction to Economics: Importance of Economics,Microeconomics and Macroeconomics,Theories and Models to Understand Economic Issues,An Overview of Economic Systems.Demand,
Supply, and Equilibrium in Markets for Goods and Services,Price Elasticity of Demand and Price Elasticity of Supply,Elasticity and Pricing,Changes in Income and Prices Affecting
Consumption Choices,Monopolistic Competition,Oligopoly.
Unit –V 07Hrs
Essentials of Macroeconomics: Prices and inflation,Exchange rate,Gross domestic product(GDP) ,components of GDP,the Labor Market,Money and banks,Interest rate,Macroeconomic models-
an overview,Growth theory, The classical model, Keynesian cross model, IS-LM-model, The AS-AD-model, The complete Keynesian model, The neo-classical synthesis, Exchange rate
determination and the Mundell-Fleming model
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Continuous Internal Evaluation (CIE); Theory (100 Marks)

CIE is executed by the way of Tests (T), Quizzes (Q),) and Experiential Learning (EL). Three tests are conducted for 50 marks each and the sum of the marks scored from three
tests is reduced to 50. Minimum of three quizzes are conducted and each quiz is evaluated for 10 marks adding up to 30 marks. All quizzes are conducted online. Faculty may
adopt innovative methods for conducting quizzes effectively. The number of quizzes may be more than three also. The marks component for experiential learning is 20. 50%
weightage should be given to case studies. Total CIE is 50 (T) +30 (Q) +20 (EL) = 100 Marks.

Semester End Evaluation (SEE); Theory (100 Marks)

SEE for 100 marks is executed by means of an examination. The Question paper for the course contains two parts, Part – A and Part – B. Part – A consists of objective type
questions for 20 marks covering the complete syllabus. Part – B consists of five main questions, one from each unit for 16 marks adding up to 80 marks. Each main question may
have sub questions. The question from Units I, IV and V have no internal choice. Units II and III have internal choice in which both questions cover entire unit having same
complexity in terms of COs and Bloom’s taxonomy level. 50% weightage should be given to case studies.

High-3 : Medium-2 : Low-1

CO-PO Mapping
CO/ PO PO1 PO2 PO3 PO4 PO5 PO6 PO7 PO8 PO9 PO10 PO11 PO12
CO1 3 --- 1 --- ---- 3 ---- 3 3 3 3 3
CO2 3 2 --- --- --- ---- 1 2 3 2 2
CO3 --- --- 1 --- --- 2 --- 2 2 3 3 3
CO4 2 --- 2 --- ---- 3 1 3 2 2 3 3

Reference Books
1 Stephen Robbins, Mary Coulter &NeharikaVohra, Management, Pearson Education Publications, 10th Edition, ISBN: 978-81-317-2720-1.
2 James Stoner, Edward Freeman & Daniel Gilbert Jr, Management, PHI, 6th Edition, ISBN: 81-203-0981-2.
3 Steven A. Greenlaw ,David Shapiro,Principles of Microeconomics,2nd Edition,ISBN:978-1-947172-34-0
4 Dwivedi.D.N, Macroeconomics: Theory and Policy,McGraw Hill Education; 3rd Edition,2010,ISBN-13: 978-0070091450.
5 Peter Jochumzen, Essentials of Macroeconomics, e-book(www.bookboon.com), 1st Edition., 2010, ISBN:978-87-7681-558-5.
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Introduction to Management

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Draw or type 2 things you already know about Management

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Definitions of Management
• “Management is an art of getting things done through people”. - Mary Parker
Fallett

• “Management is a process of planning, organizing, staffing, directing and

controlling to accomplish organizational objectives through the coordinated
use of human and material skills”. – Prof. Moore

• “Management is the process of designing and maintaining an environment in

which individuals working together in groups, accomplish their aims
efficiently and effectively”. - Koontz
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Organization Management
• Organization Management is an art of knowing what to do, when to do

and see that it is done in the best and cheapest way.

• It refers to the art of getting people together on a common platform to make

them work towards a common predefined goal.

• It enables the optimum use of resources through meticulous planning

and control at the workplace.

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Need for Organizations Management

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Need for Organizations Management

• Organization Management gives a sense of direction to the employees so that, they

are well aware of their roles and responsibilities and know what they are supposed
to do in the organization.

• It also gives a sense of security and oneness to the employees.

• An effective management is required for better coordination among various
departments.

• Employees accomplish tasks within the stipulated time frame as a result of effective
organization management, stay loyal towards their job and do not treat work as a
burden.
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Management as a Specialty in Time

• Management is an attempt to create a desirable future, keeping the past

and the present in mind.

• It is practiced in and is a reflection of a particular historical era.

• It is a practice that produces consequences and effects that emerge over

time.
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Management as a Specialty in Human Relationships

• Managers act in relationships that are two way streets; each party is
influenced by the other.
• They also act in relationships that have spillover effects for other people,
for better and for worse.
• Managers juggle multiple simultaneous relationships.
 Some Key Concepts Go, change the world

• Managerial performance is the measure of how efficient and effective a

manager is; i.e., how well he or she determines and achieves appropriate
objectives.

• Organizational performance is the measure of how efficient and effective an

organization is; i.e., how well it achieves appropriate objectives.

• Efficiency (resource usages) is the ability to minimize the use of resources in

achieving organizational objectives - “doing the things right”.

• Effectiveness (goal attainment) is the ability to determine appropriate

objectives - “doing the right thing”.
Effectiveness and Efficiency
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Effectiveness and Efficiency
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Is this statement true or false?Efficiency is Doing Right
things and Effectiveness is Doing the things right

True False
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The Management Process
It is a dynamic process by which management creates, operates and directs
purposive organization through systematic, coordinated and co-operated
human efforts.

As a process, management consists of three aspects:

• Management is a social process – Human factor & Relationships
• Management is an integrating process – Human, Physical & Financial
• Management is a continuous process – Problem solving
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Basic Steps in Management

• Vision
• Mission
• Objectives/Goals
• Strategy
• Policies
• Procedures/Rules
• Budget
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Basic Steps in Management

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Mission statements of Top brands

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Vision statement of top brands

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Vision and Mission statements of ME Dept

VISION
Quality education in Design, Materials, Thermal and Manufacturing with emphasis on research, sustainable
technologies and entrepreneurship for societal symbiosis.
MISSION
Imparting knowledge in basic and applied areas of Mechanical Engineering.
Providing state-of-the-art laboratories and infrastructure for academics and research in the areas of design,
materials, thermal engineering and manufacturing.
Facilitating faculty development through continuous improvement programs.
Promoting research, education and training in materials, design, manufacturing, Thermal Engineering and
other multidisciplinary areas.
Strengthening collaboration with industries, research organizations and institutes for internship, joint
research and consultancy.
Imbibing social and ethical values in students, staff and faculty through personality development programs
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I observe...
Describe what you saw
or what happened

Mintzberg’s
Managerial Roles
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Activities / Functions of Management

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Planning
• Planning is the basic function of management. It deals with chalking out a future course of
action and deciding in advance the most appropriate course of actions for the achievement
of pre-determined goals.

• According to Koontz, “Planning is deciding in advance - what to do, when to do & how to
do. It bridges the gap from where we are & where we want to be”.

• It is all pervasive, an intellectual activity and also helps in avoiding confusion,

uncertainties and risks.

• Thus, planning is a systematic thinking about ways & means for accomplishment of pre-
determined goals.
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Organizing
• Organizing is the process of bringing together physical, financial & human resources and
developing productive relationship amongst them for achievement of organizational goals.

• According to Henry Fayol, “To organize a business is to provide it with everything useful
or its functioning i.e. raw materials, tools, capital and personnel”.

Organizing as a process involves:

• Identification of activities
• Classification of grouping of activities
• Assignment of duties
• Delegation of authority and creation of responsibility
• Coordinating authority and responsibility relationships
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 Staffing Go, change the world

• The main purpose of staffing is to put the right man on to the right job.
• According to Koontz & O’Donnell, “Managerial function of staffing involves manning the
organization structure through proper and effective selection; appraisal & development of
personnel to fill the roles designed in the structure”.

Staffing involves:

• Manpower planning
• Recruitment, selection & placement
• Training & development
• Remuneration
• Performance appraisal
• Promotions & transfer
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Leading
• Leading is that part of managerial function which actuates the organizational
methods to work efficiently for achievement of organizational purposes.
• It is an interpersonal aspect of management which deals directly with
influencing, guiding, supervising, motivating subordinates for the
achievement of organizational goals.
Leading has following elements:
• Supervision
• Motivation
• Leadership
• Communication
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• The purpose of controlling is to ensure that everything occurs in conformities with the
standards.

• According to Koontz & O’Donnell, “Controlling is the measurement & correction of

performance activities of subordinates in order to make sure that the enterprise objectives
and plans desired to obtain, are being accomplished”.

Controlling has following steps:

• Establishment of standard performance

• Measurement of actual performance
• Comparison of actual performance with standards and finding out deviation if any
• Corrective action
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Management as an Activity
Managerial Roles

• Informational Activities: in the functioning of business enterprise, the manager constantly

has to receive and give information orally or in written. A communication link has to be
maintained with subordinates as well as superiors for effective functioning of an enterprise.

• Decisional Activities: Practically all types of managerial activities are based on one or the
other types of decisions. Therefore, managers are continuously involved in decisions of
different kinds since the decision made by one manager becomes the basis of action to be
taken by other managers.

• Inter-personal Activities: Management involves achieving goals through people.

Therefore, managers have to interact with superiors as well as the sub-ordinates. They
must maintain good relations with them.
 Types of Managers / Management Level
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First-line Managers

• First-Line/Lower level Management is also known as supervisory/operative level of management.

• It consists of supervisors, foreman, section officers, superintendent etc.
• Supervisory management refers to those executives whose work has to be largely with personal
oversight and direction & controlling of operative employees.

Their activities include:

• Assigning of jobs and tasks to various workers.

• They guide and instruct workers for day to day activities.
• They are responsible for the quality as well as quantity of production.
• They communicate workers problems, suggestions & recommendatory appeals etc. to the higher
level and higher level goals and objectives to the workers.
 Types of Managers / Management Level
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Middle Managers

• The branch managers and departmental managers constitute middle level.

• They are responsible to the top management for the functioning of their department.

• They devote more time to organizational and directional functions.

Their role can be emphasized as:

• They execute the plans of the organization in accordance with the policies and directives of the top
management.
• They participate in employment & training of lower level management.

• They are responsible for coordinating the activities within the division or department.

• They are also responsible for inspiring lower level managers towards better performance.
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Types of Managers / Management Level
Top Managers

• It consists of board of directors, chief executive officer or managing director.

• The top management is the ultimate source of authority and it manages goals and policies for an
enterprise.

• It devotes more time on planning and coordinating functions.

The role of the top management can be summarized as follows:

• Top management lays down the objectives, strategic plans and broad policies of the enterprise.
• It issues necessary instructions for preparation of department budgets, procedures, schedules etc.
• It controls & coordinates the activities of all the departments.
• The top management is also responsible towards the shareholders for the performance of the
enterprise.
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Types of Managers / Management Level

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Management Skills
• Technical skill is the ability to use the procedures, techniques and knowledge of a
specialized field. Surgeons, engineers, musicians and accountants all have technical
skills in their respective field.
• Human skill is the ability to work with, understand and motivate other people as
individuals or in groups.
• Conceptual skill is the ability to coordinate and integrate all of an organization’s
interests and activities. It involves seeing the organization as a whole,
understanding how its parts depend on one another and anticipating how a change
in any of its parts will affect the whole.
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Management Skills
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The Challenges of Management

• The need for vision

• The need for ethics
• The need for responsiveness to cultural diversity
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The Evolution of Management Theory

Modern management
approaches

Early management approaches

Industrial Revolution

Adam Smith division of labor

Venetian business enterprises

and their management practices

1400 1700 1800 1900- 1950 Post 1950

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Key Management Theories – An Overview
In search of Excellence becomes bestseller
(Mid-1980s)
“Muckrakers” began exposes of The Great Depression Begins Deming lectures on quality in
business (1902) Japan Apple Corp. Formed Baldrige Award
(1977) initiated (1987)

1890 1900 1910 1920 1930 1940 1950 1960 1970 1980 1990

Labour Shortage World War I World War II Protest Movemenets IBM PC AT & T divestiture
(1960s to early Introduced takes effect (Jan 1,
(1914-1918) (1941-1945)
1970s) (1981) 1984)

Scientific Management School Classical Organizational Theory School

The Behavioral School

Management Science

The System Approach

The Contingency Approach

Dynamic Engagement Approach

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The Scientific Management School

• Scientific Management theory arose in part from the need to increase productivity.
• The only way to expand productivity was to raise the efficiency of workers.

Frederick W. Taylor (1856-1915) rested his philosophy on four basic principles:

• The development of a true science of management, so that the best method for performing
each task could be determined.
• The scientific selection of workers, so that each worker would be given responsibility for
the task for which he or she was best suited – Functional foremanship.
• The scientific education and development of the worker.
• Intimate, friendly cooperation between management and labor.
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The Scientific Management School

• Taylor based his management system on production-line time studies.
• Using time study as his base, he broke each job down into components and designed the
quickest and best methods of performing each component. In this way he established how
much workers should be able to do with the equipment and materials at hand.
• He also encouraged employers to pay more productive workers at a higher rate than others
using a ‘scientifically correct rate’ that would benefit both company and worker.
• Thus, workers were urged to surpass their previous performance standards to earn more
pay. Taylor called his plan the differential rate system.
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The Classical Organization Theory School
• Henri Fayol (1841-1925) is generally hailed as the founder of the
classical management school.

• Taylor was basically concerned with organizational functions;

however, Fayol was interested in the total organization and focused on
management which he felt had been the most neglected of business
operations.
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Fayol’s14
principles of
management

management must foster the morale of its employees. He further suggests that, "real talent is

needed to coordinate effort, encourage keenness, use each person's abilities, and reward

each one's merit without arousing possible jealousies and disturbing harmonious relations."

Harmony and pulling together among personnel.

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The Behavioral School
• The behavioral school emerged partly because the classical approach did
not achieve sufficient production efficiency and workplace harmony.

• To managers’ frustration, people did not always follow predicted or

expected patterns of behavior.

• Thus there was increased interest in helping managers deal more

effectively with the ‘people side’ of their organizations.
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Relations Theory – The Human Relations Movement

• Human relations are frequently used as a general term to describe the ways in
which managers interact with their employees.

• When “employee management” stimulates more and better work, the

organization has effective human relations; when morale and efficiency
deteriorate, its human relations are said to be ineffective.

• The human relations movement arose from early attempts to systematically

discover the social and psychological factors that would create effective
human relations.
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The Hawthorne Experiments

The human relations movement grew out of a famous series of studies conducted at
the Western Electric Company from 1924 to 1933. These eventually became known
as the “Hawthorne Studies” because many of them were performed at Western
Electricity Hawthorne plant by Elton Mayo near Chicago. They were:

• Illumination Experiments
• Relay Assembly Test Room
• Interviewing Program
• Bank Wiring Test Room
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Part I - Illumination Experiments (1924-27)

These experiments were performed to find out the effect of different levels of

illumination (lighting) on productivity of labour. The brightness of the light

was increased and decreased to find out the effect on the productivity of the

test group. Surprisingly, the productivity increased even when the level of

illumination was decreased. It was concluded that factors other than light

were also important.

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Part II - Relay Assembly Test Room Study (1927-1929)

Under this test two small groups of six female telephone relay assemblers were

selected. Each group was kept in separate rooms. From time to time, changes were

made in working hours, rest periods, lunch breaks, etc. They were allowed to choose

their own rest periods and to give suggestions. Output increased in both the control

rooms. It was concluded that social relationship among workers, participation

in decision-making, etc. had a greater effect on productivity than working conditions

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Part III - Mass Interviewing Programme (1928-1930)

21,000 employees were interviewed over a period of three years to

find out reasons for increased productivity. It was concluded that

productivity can be increased if workers are allowed to talk freely

about matters that are important to them.

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Part IV - Bank Wiring Observation Room Experiment (1932)

A group of 14 male workers in the bank wiring room were placed

under observation for six months. A worker's pay depended on the
performance of the group as a whole. The researchers thought that the
efficient workers would put pressure on the less efficient workers to
complete the work. However, it was found that the group established
its own standards of output and social pressure was used to achieve the
standards of output.
 Conclusions of Hawthorne Studies / Experiments
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• The social and psychological factors are responsible for workers' productivity and job
satisfaction. Only good physical working conditions are not enough to increase productivity.
• The informal relations among workers influence the workers' behaviour and performance
more than the formal relations in the organisation.
• Employees will perform better if they are allowed to participate in decision-making affecting
their interests.
• Employees will also work more efficiently, when they believe that the management is
interested in their welfare.
• When employees are treated with respect and dignity, their performance will improve.
• Financial incentives alone cannot increase the performance. Social and Psychological needs
must also be satisfied in order to increase productivity.
• Good communication between the superiors and subordinates can improve the relations and
the productivity of the subordinates.
• Special attention and freedom to express their views will improve the performance of the
workers.
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Criticism of Hawthorne Studies / Experiments
• Lacks Validity : The Hawthorne experiments were conducted under controlled situations. These
findings will not work in real setting. The workers under observation knew about the experiments.
Therefore, they may have improved their performance only for the experiments.

• More Importance to Human Aspects : The Hawthorne experiments gives too much importance to
human aspects. Human aspects alone cannot improve production. Production also depends on
technological and other factors.

• More Emphasis on Group Decision-making : The Hawthorne experiments placed too much emphasis
on group decision-making. In real situation, individual decision-making cannot be totally neglected
especially when quick decisions are required and there is no time to consult others.

• Over Importance to Freedom of Workers : The Hawthorne experiments gives a lot of importance to
freedom of the workers. It does not give importance to the constructive role of the supervisors. In
reality too much of freedom to the workers can lower down their performance or productivity.
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Hawthorne Studies

• https://www.menti.com/c7azmptgir

• Who discovered the Hawthorne Effect?

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The Management Science School
• At the beginning of World War II, Great Britain desperately needed to solve a number of new, complex
problems in warfare. With their survival at stake, the British formed the first operational research (OR)
teams.

• By pooling the expertise of mathematicians, physicists, and other scientists in OR teams, the British were
able to achieve significant technological and tactical breakthroughs and so as the Americans.

• The teams used early computers to perform the thousands of calculations involved in mathematical modeling.
• When the war was over, the applicability of operations research to problems in industry gradually became
apparent. New industrial technologies were being put into use and transportation & communication were
becoming more complicated.

• These developments brought with them a host of problems that could not be solved easily by conventional
means. Increasingly, OR specialists were called on to help managers come up with answers to these new
problems.
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The Management Science School
• Over the years, OR procedures were formalized into what is now more generally called the
management science school.

• The management science approach to solving a problem begins when a mixed team of specialists
from relevant disciplines is called in to analyze the problem and propose a course of action to
management.

• The team constructs a mathematical model that shows, in symbolic terms, all relevant factors
bearing on the problem and how they are interrelated.

• By changing the value of the variables in the model (such as increasing the cost of raw materials)
and analyzing the different equations of the model with a computer, the team can determine the
effects of each change.

• Eventually the management science team presents management with an objective basis for making
a decision.
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The Simplex Method
Example: Product Mix Problem

A Company produces two products: I and II. The raw material requirements, space needed for storage,
production rates, and selling prices for these products are given below:

The total amount of raw material available per day for both products is 15751b. The total storage space
for all products is 1500 ft2 and a maximum of 7 hours per day can be used for production. The company
wants to determine how many units of each product to produce per day to maximize its total
income.
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Solution
v Step 1: Convert all the inequality constraints into equalities by
the use of slack variables. Let:

As already developed, the LP model is:

…..Eq (4)
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…..Eq (5)

From these equations, the new feasible solution is readily found to be: x1 = 270, x2 = 75, S1
= 45, S2 = 0, S3 = 0, Z = 4335.
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The Systems Approach
• The systems approach to management views the organization as a unified, purposeful system composed of
interrelated parts.

• This approach gives managers a way of looking at the organization as a whole and as a part of the larger,
external environment.

• Systems theory tells us that the activity of any segment of an organization affects, in varying degrees, the
activity of every other segment.

• Production managers in a manufacturer’s plant, for example prefer long uninterrupted production runs of
standardized products in order to maintain maximum efficiency and low costs.

• Marketing managers, on the other hand, who want to offer customers quick delivery of a wide range of
products, would like a flexible manufacturing schedule that can fill special orders on short notice.

• Systems oriented production managers make scheduling decisions only after they have identified the impact
of these decisions on other departments and on the entire organization.
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• The point of the systems approach is that managers cannot function wholly within the confines of the traditional organization
chart. They have to communicate not only with other employees and departments, but frequently with representatives of other
organizations as well.

Some Key Concepts

• Subsystems: The parts that make up the whole of a system are called subsystems. And each system in turn may be a
subsystem of a still larger whole. Thus a department is a subsystem of a plant, which may be a subsystem of a company, which
may be a subsystem of an industry.

• Synergy: Synergy means that the whole is greater than the sum of its parts. In organizational terms, synergy means that as
separate departments within an organization cooperate and interact, they become more productive than if each were to act in
isolation. For example, in a small firm, it is more efficient for each department to deal with one Finance department than for
each department to have a separate finance department of its own.

• Open and Closed Systems: A system is considered an open system if it interacts with its environment; it is considered a
closed system if it does not. All organizations interact with their environment, but the extent to which they do so varies. An
automobile is a perfect example for an open system.
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The Systems Approach
• System Boundary: Each system has a boundary that separates it from its environment. In a closed system,
the system boundary is rigid; in an open system, the boundary is more flexible. The system boundaries of
many organizations have become increasingly flexible in recent years. For example, managers at oil
companies wishing to engage in offshore drilling now consider public concern for the environment.

• Flow: A system has flow of information, materials and energy (including human energy). These enter the
system from the environment as inputs (raw materials for example), undergo transformation processes within
the system (operations that alter them) and exit the system as outputs (goods and services).

• Feedback: Feedback is the key to system controls. As operations of the system proceed, information is fed
back to the appropriate people and perhaps to a computer, so that the work can be assessed and if necessary
corrected.

Systems theory calls attention to the dynamic and interrelated nature of organizations and the management
task. With a systems perspective, general managers can more easily maintain a balance between the needs of
the various parts of the enterprises and the needs and goals of the whole firm.
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GENERAL
ENVIRONMENT

ECONOMIC
SOCIAL OPERATING
ENVIRONMENT

NEW ENTRANTS
SUPPLIER

PLANNING, ORGANIZING,
INFLUENCING, CONTROLLING
INPUT  PROCESS OUTPUT
SUBSTITUTES
POLITICAL
COMPETITION
TECHNOLOGY

CUSTOMER

LEGAL
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The Contingency Approach

• The contingency approach (sometimes called the situational approach) was developed by
managers, consultants and researchers who tried to apply the concepts of the major schools
to real life situations.
• When methods were highly effective in one situation, failed to work in other situations.
Results differ because situations differ, a technique that works in one case will not
necessarily work in all cases.
• According to the contingency approach, the manager’s task is to identify which techniques
will, in particular situation, under particular circumstances and at a particular time, best
contribute to the attainment of management goals.
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The Contingency Approach

• Where workers need to be encouraged to increase productivity, for example, the classical
theorist may prescribe a new work simplification scheme.
• The behavioral scientist may instead seek to create a psychologically mutating climate and
recommend some approach like job enrichment.
• If the workers are unskilled and training opportunities and resources are limited, work
simplification would be the best solution. However, with skilled workers driven by pride in
their abilities, a job-enrichment program might be more effective.
• The contingency approach represents an important turn in modern management theory,
because it portrays each set of organizational relationships in its unique circumstances.
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Contingency approach –an example
• Managers at Taco bell addressed the question of what would work best for its restaurants

• Redefined business based -customers value food service and the physical appearance of the
restaurant

• recruited new managers who were committed to creating or delivering goods that customer
value and who could coach and support staff in the new direction

• To concentrate on customers, Taco Bell outsourced much of the assembly-line food preparation,
such as shredding lettuce, allowing employees to focus on customers.

• As a result it enjoyed a 60 percent growth in sales at company owned stores.

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Contingency approach
https://www.menti.com/jtu3e8cezw

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Bases Classical Behavioral Systems Contingency

Work as well as
Small groups and also
Focus the economic needs of Interrelationships Situational variables
human behavior
workers

Environmental
Mechanical and also Organization as a social Open Systems view of
Structure determinants of
Impersonal system the organization
organization

Empirically
Means Group participation Conceptual skills Environmental Scanning
derived Principles

Work alienation as well as Satisfied and also Systems theory as well Dynamic management
Results
dissatisfaction efficient employees as design style

Authoritarian and also Democratic and also Business

Practices Systems concepts
bureaucratic participative environment Interface

F.E. Kast, P.R. Lawrence,

Main F. W. Taylor, Henri Fayol, Elton Mayo, A.H. Maslow,
J.E. Rosenzweig, J.W. Lorsch, J.
Exponents Max Weber Douglas McGregor
R.A. Johnson Woodward 69
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Indian Companies for CSR in 2019

Infosys Ltd: COVID relief projects dominated the activities, with education and health-related programmes following
after. Among the main initiatives in the financial year 2019-20 were a 100-bed quarantine setup in Bengaluru in
partnership with Narayana Health City, and another one which had 182 beds for COVID-19 patients for Bowring and
Lady Curzon Medical College & Research Institute.
Bharat Petroleum Corporation Ltd. BPCL employees stood strong in the fight against the virus. They made a
collective contribution of INR 4.27 Crores from their salaries. As part of its corporate social responsibility for COVID-
19 relief, the PSU organised ‘Swachhata Pakhwada 2020’ from July 1 to 15, 2020. This special initiative was in support
of the Indian government’s Swachh Bharat Abhiyan. BPCL also tied up with an NGO named Bisnouli Sarvodaya
Gramodyog Sewa Sansthan (BSGSS) for a cleanliness and awareness drive in Nuh district of Haryana. The CSR team
also went around villages with a medical team and distributed special kits comprising dustbins, face masks and a hand
sanitizer to 400 families. The medical team informed them of precautionary measures.
Mahindra & Mahindra spent INR 93.50 crores on CSR initiatives during the financial year 2018-19, according to the
annual report published by the company. The company spent INR 8.36 crore on Project Nanhi Kali which provides
educational support to underprivileged girls in India through an afterschool support programme. 70