Unit-1

OVERVIEW OF
MANAGEMENT
Why Study Management?
The Value of Studying Management
 The universal of management
Good management is needed in all organizations.
 The reality of work
Employees either manage or are managed.
 Rewards and challenges of being a manager
Management offers challenging, exciting and creative
opportunities for meaningful and fulfilling work.
Successful managers receive significant monetary
rewards for their efforts.
Definition of Management:
• Management involves coordinating and supervision
the work activities of others so that their activities
are completed efficiently and effectively.
Functional area of management
 Financial management
 Human Resource management
 Marketing management
 Production management
 Purchasing management
 Maintenance management
Is management – an art or science
Management is a science
• Because it is a systematic body of knowledge
with array of principles.
• Based on a scientific enquiry.
• Principle should be verifiable.
• Reliable basis for Predicting future events.
Management is also an art
• Art is an Inborn talent. However it can be
refined through Learning and Practice.
• Management is a creative.
• Application of practical knowledge and certain
skills helps to achieve actual results.
Management is a both arts and science
Because it contains general principles. It
required certain personal skill to achieve desired
results
The features of Management include:
• Management is a continuous process
• Management aims to achieve the organization
goals by ensuring effective use of resources
• Management is multidisciplinary in nature
• Management functions are planning,
organizing, staffing, directing and controlling
• Management is a dynamic & not a static.
• It is a group activity.
• Management is a system of authority.
Scientific Management:-
• F.W.Taylor- Father of scientific management,
has defined as follows: “Scientific
management is concerned with knowing
exactly what you want to do and then see
that they do it in the best and cheapest way.”
Principles of Scientific Management

List the principles of scientific management.

• Observation & measurement should be used
in the Organization.
• The employees should be scientifically
selected and trained.
• Due to scientific selection and training of
employee has the opportunity of earning a
high rate of pay.
 Taylor conducted various experiments at the work
place to find out how human being could be made more
efficient by standardizing the work. The following
features of scientific management.
i)Separation of planning and doing
ii)Work study
iii)Job analysis
iv)Standardisation
v)Scientific selection & training
vi)Financial incentives
vii)Economy
viii)Mental revolution.
Who Are Managers?
A manager is someone who work with and
through other people by coordinating their work
activities in order to accomplish organizational goal.
Roles of Manager
 Interpersonal roles
• Figurehead role
• Leader
• Liaison
 Informational roles
• Monitor
• Spokes person
• Disseminator
 Decisional roles
• Entrepreneur
• Disturbance handler
• Resource allocator
Fayol’s Administrative management Theory

Henri Fayol-French mining engineer, he identified 14 principles

of management based on his management experiences. He is a father
of modern theory of general & industrial management. He divided the
total industrial activities into six categories.
1. Technical (Production, manufacture)
2. Commercial(Buying,selling,Exchange)
3. Financial(Optimum use of capital)
4. Security (Protection of property & persons)
5. Accounting(Balance sheets)
6. Management(Planning,Organising,Directing,controlling)
Fayol Principles
1. Division of Work
2. Authority & Responsibility
3. Discipline
4. Unity of Command
5. Unity of Direction
6. Subordination of individual interest
7. Remuneration of personnel
8. Centralisation
9. Scalar chain
10. Order
11. Equity
12. Stability of tenure of personnel
13. Initiative
14. Esprit de corps
Bureaucratic Management Theory
• Max Weber
A well know German sociologist, coined
the term “bureaucracy” to apply the idea in large
organisation.
Such a employee should be loyal to
supervisors rather than the organisation.
This is non-personal objective form of
organisation was called a bureaucracy.
 Weber believed that there are following
three type of authority exist in nature.
1.Traditional:- Subordinate obedience based upon
traditional(eg:Kings,queens,chiefs).
2.Charismatic: Subordinate obedience based upon
special personal qualities such as political leader,
religious leaders, Organisation leaders.
(eg:Gandhi,Nehru,Matrin Luther king).
3.Rational-legal:-Subordinate obedience based upon
the position held by superiors within the organisation
(eg:police officers,executives)
Weber Principles
A well defined hierarchy:
In this way permits the higher positions to
supervise and control the lower position. Position
should arrange hierarchically so that the employees
should know whom to report and who report to them.
Division of labor & specialization:
All responsibilities in an organisation are
specialized so that each employee has the necessary
expertise to do the particular task.
System of written rules & regulation:
Organisation must create a well defined system of
rules, standard operating procedures, & norms so that
they can effectively control the behaviour within the
organisation.
Impersonal relationships between mangers &
employees:-
Selection and evaluation system:-
Evaluation based on work output
Record:-
Maintain complete files regarding all its activities.
Behavioral Management Theory
– The behavioral theory point out the role of
psychology & sociology in understanding of
individual and group behavior.
– It is modified and improved form of classical
theory.
– Several individual and experiments
contributed to this theory.
Mary Parker Follett:-
 The important of the functioning of group, not
just individuals in organization.
 The principle of “Power with” rather than the
“Power over” in the management employee relations.
 The conflict resolution through integration,i.e
finding a solution to a conflict that would satisfy both
parties.
Elton Mayo:-
A team of researchers from Harvard university, led
by Mayo , conducted some experiment & investigated
informal grouping, informal relationship, pattern of
communication,ledaership etc.
Hawthorne Studies:-
This series of studies was conducted in
western electric company in Chicago. In this
experiment consists of four parts as follows:
1)Illumination Experiment
2)Relay Assembly Test Room experiment
3)Bank wiring Test Room experiment
4)Mass interview programme
Abraham Maslow:-
A practicing psychologist developed one of
the most widely recognized hierarchy of needs theory.In
this theory motivation based upon consideration of
human need.
Douglas McGregor:-
He was heavily influenced by both Hawthorne
studies and Maslow. He believed that two basic kinds of
mangers exists. One type negative view of employees
and another hand capable of assuming responsibility,
but also have high level of motivation.
Chester barnard:-
A president of New jersey Bell telephone
company. He developed an acceptance theory of
authority.
Systems Approach to Management
• System is a interrelated & interdependent parts
arranged in a manner that produces a integrated
whole.
• While whole organization is a system, the various
parts within it are called subsystem. Thus a
department is a subsystem of the organization.
• All the interrelated or subsystem of the organization
operate as a whole in chase of common goals. An
organization as a system is composed of five
elements.
• Input- Human, materials, financial,equipment
required to produce goods & services.
• Transformation Process-Technological abilities
to convert inputs into outputs.
• Output-The products,services and other outcomes
produced by the organization.
• Feedback-Information about results &
organisational status.
• Environment-A set of forces & conditions operate
beyond an organisation’s boundaries it affect the
acquire & utilize resources.
The following terminologies are important to
understand the system approach:
i)Closed System-It interacts little with its
external environment.
ii)Open system-It interacts with its
environment ,It once which constantly comes into
contact
iii)Entropy-It is a tendency of system to break
down over time
iv)Synergy-When all the subsystem work,
making the greater than the sum of output of its
parts.
• External Environmental

Inputs Transformation Output

Human resources Machinery
Raw materials Computer Goods
Money & Capital Human skill Services

Feed Back

Sales report
Profit/Loss statement
Contingency Approach to Management

• It may called as ‘Situational approach’. This

theory was developed by Tom Burns
G.M.Stalker.
• The crucial message of contingency theory is
that there is no one best way to organise.
• The characteristics of environment affect the
organisation ability to obtain resources.
 Organization & Environmental Factors
• All organization whether they are engaged in
business or non – business activities draw the
input from the environment and convert into
output and send back to environment.
• Internal Environmental-Technolgy, structure,
process & People.
• External Environmental-economic condition,
political factor, social-cultural factor
Internal Environment Factor:-
i)Supplier
ii)Customers
iii)Competitors
External Environment Factor:-
i)Technology
ii)Economic conditions
iii)Political Factors
iv)Socio Cultural Factors
 Trends & Challenges of Management in
Global Scenario
• Changes in socio-economic and political
condition are bound to bring the changes in
the environment within the organization.
• Then the mangers are observe the rapid
change in the environment and therefore,
they should update their knowledge & skills to
attain the needs of objectives of organization.
 Workforce Diversity
When workers join organizations, they come with
their different culture values & life style,
Therefore the challenge for organization is to
make them accommodate to various group of people at
the woke place.
 Changing Employee Expectations:-
Beside change in workforce, employee
expectation and aspiration have changed from
traditional way, such as job security, good and attractive
remuneration to empower ,equality and quality of work
 International Environment
Creating an environment which is responsive to external
changes, providing satisfaction to member of
organization.
Building Organization Capabilities:
Managers would include not only a assisting them to
acquire new skill and knowledge, He should evaluate
environmental changes to evolve business strategies.
 Technology Advance
In the wake of technological advances, new job
will be created and many old job will become
redundant. For this unemployment manpower need and
training of redundant employee in alternate skills.
Expanding Globalization
• Globalization is the process of transformation
of local or regional phenomena into global
ones.
• Economic globalization is intergration of
national economic to international economies
through trade,foreign investment,migration
and spread of technology
Globalisation of business posed at least two
major challenge for managers.
 In case of MNC the mangers are frequently
transferred from one country to another.
 Even in their own country ,they have different
culture.
Indian Business in globalization
Globalization announced the New
industrial Policy(NIP) in 1991.It remove
restriction on foreign investment in Indian
business.
Indian Business in the Globalaisation:-
Globalaisation announced the New
Industrial Policy(NIP) in 1991 . According to NIP
liberalisation of Foreign investment was one of
the features.
The advance technology in
telecommunication,transportation &Information
technology have made possible globalaisation
business.
Eg:Ford-Escort,Maruthi Suzuki, Hero
Honda
Textile:-
Arvind Mills,Raymond,Crazim
Pharmaceuticals:-
Cipla,Orchid,Raanbaxy
Software:-
HCL,TCS,Infosys,Wipro , IBM
 Multinational Companies
• Multinational companies are companies that
manufacture and market product or services
in several countries.
• The management of MNC adopts international
management.
• It defined as “An enterprise which own or
control production or service facilities outside
the country in which they are based”
Advantages:
MNC can promote quality at lower cost. It
is most benefit to consumer.
MNC helps to expand the market.
MNC leads to increase in production
exports and imports of required inputs.
It is paying taxes, their operations increase
governments revenues.
MNC provides lower labour cost.
Disadvantages:-
Competition from MNC affect local
industry.
MNC utilizes local labour with low cost
while obtaining high profits.
MNC’s involvement results in the lack of
development of local R&D.