Principle & Practices of Management

Principle & Practices of Management

Introduction Definition Theory Illustration

Introduction to Management Formerly, management was used mostly in

relation to circus or restaurants. But of late, it has acquired much glory and significance

There are 3 ways to think. : what should happen, what would happen and what could happen. Philosophers concentrate on should., politicians exploit the would. Managers must focus on could

There are two purposes of management: (a) to maximise productivity (b) to

maximise human welfare

Introduction contd…..

Those who consider management as a position for prestige and status, find that these vanishes as soon as they vacate their chair. However those who consider management as position for responsibility and contribution, continue to get status and prestige even after they vacate the chair. The substantive part of management is responsibility and contribution---status and prestige are shadows which follow automatically

Definition of ManagementInputs do not give outputs automatically. Resources have to be orchestrated to give effective output. Management is a social process involving co ordination of human and material resources through the process of Planning, Organising, Leading and Controlling to accomplish the stated objective by working together in a group.

Theory of ManagementManagement is an exercise in harmonizing men, money, machinery, materials and methods towards fulfilling of set objectives leading to human development, improved performance, social benefit and global welfare. The management work can be divided into basic function like (1) Planning (2) Organizing (3) Leading and (4) Controlling.

Management Function

Another easy to remember word is PODSCORB where:

P = Planning O = Organising D = Directing S = Scheduling C , O = Controlling R = Reporting B = Budgeting

Management Function

Thought Process

Leading•Lead from front•Coordinate•Communicate•Motivate

ControllingWhat people do•Set perf’nce std•Measure progress.•Interpret result•Corrective action

OrganisingWho is to do what•How much authority•Under what condn.

PlanningWhat is to be done

•When?•How?•Where?

Meaning of each function Planning denotes the determination of short and

long term plans in order to achieve the long term objective of the organization.

Organizing indicates the development of organization structure according to predetermined plans.

Leading means motivation of personnel according to predetermined plans.

Controlling offers assurance to all that management action exists

Contd….. Every organisation must set for itself the

economic and non economic mission very clearly. For non commercial organisation like educational institutions, missions are the important ones.

Hard work does not necessarily mean productive work. Sense of achievement, harmonising work logic with worker’s logic are two important task of manager

Reputed Management

Every organisation would like to be reputed , effective and productive.. These are the three levels to judge:

1. It is productive---that is, it is able to produce the goods or services it is meant to produce.

2. It is efficient----produces the goods or services with minimum expenditure of resources

3. It has reputation for excellence that is, it’s public image is held in high esteem due to quality of goods or services and responsibility towards the employees in particular and society in general

Structure of Management

Management is carried out at different levels of the organizational structure. The stages where a particular type of function starts is called Level. This refers to the demarcation between various managerial positions in an orgisation. The number of managers depends upon size of the work force and nature of business. The number of levels of managers increases with increase in business and work force.

Organisation Level

In most organization, there are three levels of management:

(1) top (2) middle and (3) lower management

Top Level

Top level of management is the ultimate source of authority. It establishes goal and practice and devotes more time in planning and coordination. It approves the decision of middle level of management.

Middle Level

Middle level of management consists of head of department, branch/regional managers and superintendents. They are responsible for their functions to the top level of management. They are the channel for communicating view of the top management and play important role in motivating the supervisors

Lower Level

Lower level of management is the direct contact channel with the work force. It is directly concerned with the control and performance of the operative employees. They guide and direct the workers and boost up their morals

Who constitute these Level

MANAGEMENT

Top Management•CMD / MD•Directors•Co. Secretary•Gen. Managers

Middle Management•HOD•Superintendent•Br / Reg. Manager

Lower Management•Forman•Supervisor•Officer

Management & AdministrationShare between various levels:

Top management

Middlemanagement

Lowermanagement

Operational area

Administrativearea

Importance of Management

Anything minus management means nothing. The managerial functions are essentially the same regardless of type of organization or level of the manager in the organization, though the mix of the functions may vary. At higher level, the planning is a major function, organizing is next. Leading and controlling comes last. At lower level of management, leading and controlling are main functions.

Fayol’s Principles of Management

Henri Fayol, a French Mining Engineer presented 14 principles of management as general guides to management process . These principles are still valid and practiced

1. Division of work: produces more and better work with same effort. Each work is specialized in their own merit. These are entrusted to specialists2. Authority & Responsibility: since management is getting job done by others, there should be delegation of authority and power. Responsibility is closely associated with authority and it arises wherever authority is exercised. Responsibility is feared as much as Authority is sought after. Therefore, an individual who is willing to exercise authority must also be willing to bear responsibility to perform.

3. Discipline: absolutely essential for smooth running of business. By discipline, we mean obedience to authority, observance of rules of service, respect for agreements, sincerity, respect for superiors etc. For best discipline, we need (i) good supervisor at all levels (ii) clear and fair agreement between employee and employer (iii) judicious application of penalties.4. Unity of command: each employee should receive instruction for a particular work from one supervisor only to avoid confusion and conflict.

5. Unity of direction: there should be complete identity between individual and organizational goal on one hand and between department goals inter se on the other.6. Individual vs. general interest : generally an individual is interested in maximizing his own satisfaction through more money, recognition, status etc. This is often against the general interest of the organization which lies in maximizing production. Hence there is a need to subordinate individual interest over general interest.

7. Remuneration: It should be fair to all based on general business condition. cost of living, productivity of concerned employee and firm’s ability to pay.8. Centralization: when subordinates are given more role then it is decentralization of authority. This depends upon circumstances, size of undertaking and nature of organization structure.

9. Scalar chain: it is the hierarchy of authority from highest executive to the lowest one for purpose of communication . It states relationship between superior & subordinate and implies that all communication must pass through proper channel of authority.10. Order : orderliness at work place through suitable organization of men and materials is essential. Right place for everything and for every man must be practiced.

11. Equity: it means equality of fair treatment resulting from combination of fairness and justice. Manager should be free from all prejudice, personal likes or dislikes etc. Equity ensures healthy IR( industrial relation)12. Stability of tenure: In order to motivate employee to do more work, it is essential to assure security of jobs by the management. If there is a fear, there will not be any attachment to the firm and employee may look elsewhere.

13.Initiative : it means freedom to think out and execute a plan through zeal & energy.

14. Team spirit: The original French word is Espirit de corps which means union is strength. The management should create team spirit to ensure realization of the firm’s objectives. To achieve this, Fayol suggested two things (i) motto of divide and rule should be avoided and (ii) verbal communication should be used to remove misunderstanding

Wisdom

Secret of management lies in this prayer : “Lord give me the courage to change things I can and give the patience to bear with the things I cannot change. But more importantly, give me the wisdom to distinguish between the two.”

Wisdom is manager’s greatest ability as it will be a great weakness to feel defeated in your own eyes.