Introduction
Management can be defined as the organization and coordination of activities of a business to achieve set objectives. Management involves engaging and connecting functions of generating corporate policies, planning, organizing, directing and controlling the resources to achieve the objectives of that policy. The magnitude of management varies from one person in a small organization to hundreds and thousands in multinational and big companies. In bigger organizations, the board of directors defines the company policy which is later on to the Chief Executive Officer. The quality and experience of the managers in the organization are the primary factors to evaluate a company’s worth. Large organizations have three levels of managers that are typically organized in a hierarchical pyramid structure.
Senior Managers are the Board of Directors, Managing Director and the President or Chairman or the Chief Executive Officer of an organization. These senior managers set strategic goals for an organization and take decisions in the operation of the organization. Senior managers manage and control middle managers who report to them indirectly or directly. Managers in this level are mostly are the executive-level professionals. Middle Managers are generally branch managers, department managers, section managers, and regional managers who assist the front-line managers. Middle managers correspond the strategic goals of the senior managers to the front-line managers.
Lower Managers are front-line team leaders and supervisors, who monitor the jobs of regular employees and assist with directions to their work. In Small enterprises, individual managers have multi-tasks. One manager may perform numerous roles or at times all roles perceived in larger organizations.
Characteristics of Management
Management is a managerial process: It is a process and not merely a body of individuals and those who perform this process are called managers. The managers exercise leadership by assuming authority, responsibility and direct others to act within the organisation. This Management process involves objectives,planning, organising, directing and unifying human efforts for the accomplishment of given tasks and goals.
It is a social process: Management takes place through people,the importance of human factor in management is very important and cannot be ignored. Manager's job is to get the things done with the support and cooperation of subordinates. This is human element which gives importance to management due to its special character.
Action based planning: Management is action based plan always for achieving certain objectives in terms of sales, profit and capital etc. It is a result oriented concept and not merely an abstract philosophy. It gives importance to concrete performance through suitable actions and therefore it is an action based activity.
Pervasive and universal Process: Management is comprehensive and covers all departments, activities and employees. Managers operate at different levels but their functions are identical. This indicates that management is a universal and all pervasive process.
Art, science and profession: Management is an art because certain skills are essential for good management. Management is a science and technic because it has an organised body of knowledge. Management is also a profession because it is based on advanced and cultivated knowledge.
Coordination of activities: Co ordination and co operation are the essence of management. It gives one clear direction to the whole organisation and brings unity and harmony in the whole business cycle. Good Co ordination process, effective communication is required at all levels of operations in the business is very important and essential.
Achievement of predetermined objectives: Management is a meaningful activity and set up a goal and objectives of the organisation. All organisations are essentially formed groups of individuals for achieving common objectives. An Organisation exists to attaind of specific objectives and goals.
Need of Management
Direction, Co ordination and control of group efforts: In business, many persons work together, they need proper direction and guidance for raising their efficiency. In the absence of guidance, people will work as per their desire and dis orderly working of enterprise will not be possible. Therefore Management is required and needed business planning activities, for guiding employees in the right direction and finally for coordinating their efforts for achieving best results.
Orderly achievement of business objectives: Efficient management is required and needed in order to achieve the objectives of business activity in an orderly manner.
Performance of basic managerial functions: Objectives, Planning, Organising, Co-ordinating,Controlling and leadership are the basic functions of management. Management is needed as these functions are performed through the management process.
Effective communication at all levels: Management is needed for effective and proper communication within and outside the Organisation.
Motivation of employees: Management is needed and required to motivate employees and also for coordinating their efforts so as to achieve business objectives quickly.
Success and stability of business enterprise: Efficient management is needed for success, stability and prosperity of a business enterprise.
The significance of management
Accomplishment of Goals: Management regulates the objectives and goals of an organization of various functional groups and departments, the said objectives are conveyed to the employees to seek co operation to achieve them. All the activities in the organization are directed towards organizational objectives. Management assembles and organizes the resources, arranges the factors of production, and integrates the resources effectively to achieve the goals. It directs group efforts towards the achievement of goals. Effective organization are co ordinated in such a way that the organization works towards attaining its goals.
Utilization of Resources: Management promotes optimum effective utilization of physical and human resources through organization, planning, and management, which leads to prosperity and progress of a business. Employees are motivated to perform their best at all stages so that wastages of all kinds are minimized or eliminated.
Sound Organization: Establishing a sound organization means no overlapping of efforts, A sound organization establishes effective responsibility and authority. It clarifies authority and responsibility relationships in various positions in the business enterprise. It Makes clear policies and specifies who is accountable to whom, who are the subordinates and superiors, who can give instructions to whom, and so on. Management recruits the right person possessing the right skills, qualification, and training. Management also provides workers with a sound environment for work and encourages co operation.
Establishes Equilibrium: Management ensures a foresight and a vision for the enterprise by keeping in touch with the external environment. It analyses the future which influences the current working of the organization. It also takes the necessary steps to ensure that the organization is meeting the demands of the changing environment.
Cost Reduction: Management establishes maximum results through minimum input by efficient planning. The management employs human, financial, and physical resources in the best combination, which ensures cost reduction.
National Growth And Prosperity: Efficient management of resources becomes very important at the national level. Management is very important in the economic and social development of a nation. Development of the nation depends on the resource management quality. The key to the right economic growth, better standard of living, and prosperity is the efficient management.
Industrial Relations And Competitive Strengths: Management facilitates cordial industrial relations and competitive strengths in an enterprise. It ensures the welfare and better life for employees and raises their morale by providing suitable incentives. It encourages employees to put in more interest and take more initiative concerning work so that it results in the increased profitability and productivity of the organization.
Administrative Management: Henry Fayol is known as the father of modern management. Henry Fayol was a great manager and a popular industrialist. He presented an analytical framework of the management processes. He categorized the activities of the business into six groups namely Financial, Accounting, Technical, Managerial, and Administrative. He clarified that the management functions remain the same at all levels of organizations. Administrative management highlights the functions of the management and the manager. Its main objective is to define the management philosophy and processes that are concerned with jobs at the individual level.
Operations Management: This management system emphasizes the control and operation of the production process that converts resources into finished goods. Production and operations management focuses on quality and productivity of service and manufacturing process of an organization. W. Edwards Deming has a major influence in transforming modern ideas concerning improved quality and productivity. Various aspects of production and operations management comprise of facilities layout, material requirement planning, purchasing and inventory control, flexible manufacturing systems, scheduling, just in time inventory systems, quality control, facility layout, and capacity planning.
Principles of Management
Division of Work: Employees are specialized in different sectors and are skilled differently. It signifies the importance of division and subdivision of jobs according to employee expertise in that area. According to Henri Fayol specialization contributes to efficiency in the workplace and improves productivity, which in turn increases accuracy and speed. This principle is appropriate for both managerial and technical jobs.
Authority and Responsibility: Authority and Responsibility co-exist in an organization. It claims that the organization has the authority to order its employees and with authority, there comes greater responsibility. Authority is the right of the seniors to get the job done. The responsibility can be measured back from the performance. The two should go hand in hand, authority without responsibility results in incautious behavior and responsibility without authority is unproductive.
Discipline: Discipline is essential for the smooth functioning of an enterprise. According to Henri Fayol, discipline signifies respect of authority, observing rules and regulations in an organization and sincerity. Discipline is essential at both managerial and subordinate levels. Discipline can be implemented when there are great supervisors at all levels when there are fair and clear agreements between workers and when sanctions are judiciously applied.
Unity of Command:It emphasizes on subordinates being accountable and receiving orders from one superior because of instructions from more than one seniors, likely to create conflict and confusion. It leads to a better superior-subordinate relationship.
Unity of Direction: It relates to the functioning of departments or the organization as a whole. Unity of direction is essential for the sound organization. It avoids overlapping efforts and wastage of resources. It pilots the smooth running of the enterprise.
Subordination of Personal Interest: The management must prioritize its interests and considerations and put the company objectives on top of its list. There exist all kinds of interests in an organization, and for the success of an organization, Henry Fayol suggested subordination of personal interest to the organization’s interest.
Remuneration: Productivity and motivation go hand in hand. Henri Fayol suggests a substantial amount of remuneration to keep employees motivated to work. The remuneration must be reasonable, fair, rewarding and satisfactory of efforts. Appropriate and logical wages deter differences between the management and employees. Henri Fayol also suggested provisions for various other benefits like free education and medical and residential facilities for workers.
Degree of Centralization: Centralization is the concentration of authority at the top level. Authority and the management must be properly balanced for decision-making purposes in the organization. According to Henri Fayol, the degree of centralization and decentralization depends on many factors like the business size, dependability, experiences of the superiors and the ability of subordinates. Anything that expands the role of the subordinates is decentralization, and anything that narrows the role of the subordinates is centralization.
Scalar Chain: Scalar chain refers to a chain of superiors from the top management to the lowest rank. This principle emphasizes a clear line of authority from top to bottom; connecting all managers at all levels. Every instruction, order, explanation, request, message, and so on, must pass through the scalar chain. In cases of emergency and at times, for the sake of convenience, this chain can have a shortcut which is referred to as a Gang Plank. A Gang Plank is a temporary arrangement between two different points to accommodate easy and quick communication. Gang Plank signifies that the management principles are flexible and not rigid.
Order: This approach ensures a systematic arrangement of people and things in an organization. The arrangement of things is called the material order, and the placement of people is known as the social order. Material order: A specific place for every employee. Social order: Appointment and selection of the right person for the right job. It specifies that there should be a specific place for everyone and everyone must have a specific place to establish contacts whenever necessary.
Stability of Tenure: According to Henry Fayol, the employees must not be shifted from one job to another. The service period for a job needs to be fixed. Employees should, therefore, be appointed keeping in mind the principles of selection and recruitment and once appointed, their services must be accepted. In turn, the effort, time, and money spent on employees should not be a waste. Job stability imbibes a sense of belongingness and team spirit amongst the employees, which results in improved quality and quantity of work.
Initiative: According to Henri Fayol, employees must be encouraged to take initiatives in work allocated to them; initiative means eagerness for action without being reminded to do so. He proposed that the management must provide opportunities for the employees and welcome their suggestions, ideas, new work techniques, and experiences that promote an environment of understanding and trust in the organization. He also suggests encouraging employees with non-monetary and monetary benefits.
Equality: Equality is the core value of an organization. Employees must be treated equally, and the management must be fair. Henry Foyal suggests that the managers must be impartial and fair to its subordinates and there must be no room for discrimination concerning caste, sex, ego, relations, religion, and so on. Equality promotes a cordial relationship between the subordinates and the mangers. Fayol also specified that at times, force and being harsh is essential for the sake of equality.