Introduction to Management

Definition

Management is the art of getting things done

through and with people in formally organized

group.

Management is defined for conceptual, theoretical

and analytical purpose as that process by which

manager create, maintain, direct and operate

purposive organization through systematic, co-

operative and coordinated human efforts.

Features of Management

Organized activities

Existence of objectives

Working with and through people

Relationships among resources

Decision making

Nature of Management

Multidisciplinary

Dynamic nature of principles

Relative but not absolute

Science

Art

Profession

Universality of management

Management and Administration – A Terminological Conflict

These controversies have resulted into

three different approaches:

1) Administration is above management

2) Administration is a part of management

3) Administration and Management are same

F. W. Taylor’s contribution in Management

Taylor developed scientific management

based on his experience.

His contributions can be described in two

parts :

1) Main features of scientific management

2) Principles of scientific management.

Features of Scientific Management

Separation of planning and doing

Functional foremanship

Job analysis

Standardization

Scientific selection and training of workers

Financial incentive

Economy

Mental revolution

Workshop Manager

Planning incharge Production incharge

Route Clerk

Instruction card clerk

Time and cost clerk

Disciplinarian

Speed boss

Inspector

Maintenance foreman

Gang boss

Worker

Principles of Scientific Management

Replacing the rule of thumb with science

Harmony in Group action

Co-operation

Maximum output

Development of workers

Contribution of Henry Fayol

Fayol observed in certain activities of an industrial

organization which could be divided into six groups:

Technical, Security, Financial, Commercial,

Accounting and Managerial

He has divided his approach of studying

management in to 3 parts:

1) Managerial qualities and training

2) General principles of management

3) Elements of management

Managerial Qualities

Physical (health, vigour)

Mental (judgment and adaptability)

Moral (energy, initiative loyalty)

Educational

Technical

Experience

General principles of Management

Division of workAuthority and responsibilityDisciplineUnity of commandUnity of directionSubordination of individual to general

interestRemuneration of personnelCentralization

Continue..Scalar chain

OrderEquityStability of tenureInitiativeEsprit de corps

AGB

C H

D IJE

KF

Elements Of Management

Planning

Organizing

Staffing

Directing

Controlling

Fundamentals of Planning

Introduction

Definition : “Planning is the selection and relating of facts and making and using of assumptions regarding the future in the visualization and formalization of proposed activities believed necessary to achieve desired result.’

Importance of planning

Primacy of planning

To offset uncertainty and change

To focus attention on objective

To help in coordination

To help in control

To increase the organizational effectiveness

Planning process

Perception of opportunities

Establishing objectives

Planning premises

Identification of alternatives

Evaluation of alternatives

Choice of alternative

plans

Formulation of supporting

plans

Establishing sequence of

activities

Types of Plans

Objectives and MBO

Introduction

Objectives may be defined as the end results which an organization tries to achieve.

It also defines as the goals, purposes or aims that organizations wish to achieve over varying periods of time.

Hierarchy of Objective

Top Level

Middle Level

Lower Level

Functions and Contributions

Defines organization

Direction for decision making

Performance standard

Basis for decentralization

Integrating individual, group and

organization

MBO (Management by Objectives

IntroductionMBO is a comprehensive managerial

system that integrates many key managerial activities in a systematic manner, consciously directed towards the effective and efficient achievement of organizational objectives.

MBO ProcessOrganizational Purpose and

objectives Planning Premises

Key Result Areas (KRA)

Superior’s objectives

Superior’s recommendation for subordinate’s objectives

Subordinate’s statement to his objectives

Subordinate’s agreed objectivesMatching resources

Subordinate’s Performance

Performance appraisal and Review

Recycling

Benefits of MBO

Better managing

Clarity in organizational action

Personnel satisfaction

Basis for organizational change

Decision Making Process

Specific objectives

Identification of problems

Search for alternatives

Evaluation of alternatives

Choice of alternatives

Action Results

Diagnosis Analysis

Experience

Experiments

R & D

LEADERSHIP

Definition

“Leadership is interpersonal influence exercised in a situation and directed through communication process, towards the attainment of a specified goal or goals.”

Terry has defined leadership as a “ continuous process of influencing behaviour.”

Simply defined as “ Leadership is the process of influencing and supporting others to work enthusiastically towards achieving objectives.”

Difference between a Leader and a Manager

Manager Appointment Formal authority Focus on the organizational

objectives About efficiency i.e doing

things right About coping with

complexity, about brining order and consistency to organizational life

Authority is depends on his position

Leader Emerges Informal power Focus on the followers About effectiveness i.e.

doing right things About coping with change,

about bringing a sense of purpose and direction

Power is depends on the leader’s ability

Importance of Leadership

1) Motivating Employees

2) Creating Confidence

3) Building Morale

Leadership Approach

Behavioural Approach

- Autocratic Leadership

- Participative / Democratic Leadership

- Free-rein Leadership (Laissez-faire)

Situational Approach

Theories of Leadership

Trait Theory- Personal qualities : Physical & Intelligence - Acquirable qualities :Emotional Stability,

Empathy, Motivating, Communication, Human Relations, Social, Technical SkillsBehavioural Theory

- Task oriented behaviour or problem oriented- Group oriented behaviour

Theories of LeadershipSituational theory

Motivation

Definition

Maslow’s Need Hierarchy Theory

- Lower Needs : Physiological need (hunger etc.,)

Safety and Security

- Higher Needs : Social (Belongingness)

Self-esteem ( recognition and attention)

Self-Actualisation (maximizing the use of abilities, skills

and potential)

Needs of Individuals

Providing Satisfactory environment for need

fulfillment

Engagement in work

A. H. Maslow’s hierarchy of needs

PHYSIOLOGICAL OR SURVIVAL NEEDS

SAFETY NEEDS

LOVE, AFFECTION, AND BELONGINGNESS NEEDS

ESTEEM NEEDS

SELF-ACTUALIZATION

ATTITUDE

Meaning

Features

Functions

Factors affecting to Attitude formation

Job Satisfaction

IntroductionFactors affecting Job Satisfaction :

1) Personal : Age, Education , Gender, other

2) Organizational : Occupational Level, Job Content, Considerate Leadership, Pay & Promotion, Work Group

Types of Business Organization

Private Sector Organization

Public Sector Organization

Joint Sector Organization – Venture captial company

Private Sector Organization

Sole Proprietorship

Partnership

Joint Stock companies

Co-operative Societies

Public Sector Organization

Government Departments

Public organization

Government Companies

Definition

“Leadership is interpersonal influence exercised in a situation and directed through communication process, towards the attainment of a specified goal or goals.”

Terry has defined leadership as a “ continuous process of influencing behaviour.”

Simply defined as “ Leadership is the process of influencing and supporting others to work enthusiastically towards achieving objectives.”

Difference between a Leader and a Manager

Manager Appointment Formal authority Focus on the organizational

objectives About efficiency i.e doing

things right About coping with

complexity, about brining order and consistency to organizational life

Authority is depends on his position

Leader Emerges Informal power Focus on the followers About effectiveness i.e.

doing right things About coping with change,

about bringing a sense of purpose and direction

Power is depends on the leader’s ability

Importance of Leadership

1) Motivating Employees

2) Creating Confidence

3) Building Morale

Leadership Approach

Behavioural Approach

- Autocratic Leadership

- Participative / Democratic Leadership

- Free-rein Leadership (Laissez-faire)

Situational Approach

Theories of Leadership

Trait Theory- Personal qualities : Physical & Intelligence - Acquirable qualities :Emotional Stability,

Empathy, Motivating, Communication, Human Relations, Social, Technical SkillsBehavioural Theory

- Task oriented behaviour or problem oriented- Group oriented behaviour

Theories of LeadershipSituational theory

Motivation

Definition

Maslow’s Need Hierarchy Theory

- Lower Needs : Physiological need (hunger etc.,)

Safety and Security

- Higher Needs : Social (Belongingness)

Self-esteem ( recognition and attention)

Self-Actualisation (maximizing the use of abilities, skills

and potential)

Needs of Individuals

Providing Satisfactory environment for need

fulfillment

Engagement in work

A. H. Maslow’s hierarchy of needs

PHYSIOLOGICAL OR SURVIVAL NEEDS

SAFETY NEEDS

LOVE, AFFECTION, AND BELONGINGNESS NEEDS

ESTEEM NEEDS

SELF-ACTUALIZATION

ATTITUDE

Meaning

Features

Functions

Factors affecting to Attitude formation

Job Satisfaction

IntroductionFactors affecting Job Satisfaction :

1) Personal : Age, Education , Gender, other

2) Organizational : Occupational Level, Job Content, Considerate Leadership, Pay & Promotion, Work Group

Types of Business Organization

Private Sector Organization

Public Sector Organization

Joint Sector Organization – Venture captial company

Private Sector Organization

Sole Proprietorship

Partnership

Joint Stock companies

Co-operative Societies

Public Sector Organization

Government Departments

Public organization

Government Companies

FINANCIAL MANAGEMENT

Introduction

Broadly concerned with the acquisition and use of funds.

Scope: 1) How large should be firm be and how fast should it

grow?

2) What should be the composition of the firm’s assets?

3) What should be the mix of the firm’s financing?

4) How should the firm analysis, plan and control its financial affairs?

Evolution of Financial Management

Three broad phases :

A.Traditional phase

B.Transitional phase

C.Modern phase

Goals

Main Goal

Alternative Goal

Key Activities of Financial Management

A. Financial analysis, planning and control

B. Management of the firm’s asset structure

C. Management of the firm’s financial

structure

Overview of Financial activities

Financial Analysis, Planning and Control

Balance Sheet

Long-Term Financing Fixed Assets

Short-Term Financing Current Assets

Management

of Firm’s

Financial

Structure

Management

of Firm’s

Asset

Structure

Organization of Financial FunctionChief Finance Officer

Treasurer Controller

Cash Manager Credit Manager

Capital budgeting Manager

Fund raising Manager

Portfolio Manager

Financial Accounting Manager

Cost Accounting Manager

Tax Manager

Data processing Manager

Internal Auditor

Functions of Financial System

Payment system

Pooling of funds

Transfers of resources

Risk management

Price information for decentralized decision making

Coping with informational asymmetry

Financial Instruments

Money

Demand deposit

Short-term debt

Intermediate-term debt

Long-term debt

Equity stock

Financial Institutions

Financial Markets

Money Market

Capital Market

Government Securities Market

Primary Market Secondary Market