Principles of Management Unit 1 Overview of Management.pptx

Dr. P. Dineshkumar / AP / AGE / KNCET 1
KONGUNADU COLLEGE OF ENGINEERING AND TECHNOLOGY
(AUTONOMOUS)
(Approved by AICTE, New Delhi, Affiliated to Anna University, Chennai,
Accredited by NAAC B++ Grade, Accredited by NBA, Recognized by UGC with 2(f) & 12(B)
An ISO 9001:2015 certified Institution)
Namakkal - Trichy Main Road, Thottiam, Trichy - 621215
SUBJECT CODE & NAME
20MG501
PRINCIPLES OF MANAGEMENT
Prepared by,
Dr. P. Dineshkumar M.E., Ph.D.,
Assistant Professor,
Department of Agricultural Engineering,
Kongunadu College of Engineering and Technology.

UNITS
1. Overview of Management.
2. Planning.
3. Organising.
4. Directing.
5. Controlling.

OVERVIEW OF MANAGEMENT
Introduction to Management and Organization –
Management Functions – Types of Managers – Managerial
Roles and Skills – Evolution of Management Theory –
Managing a Global Environment – Social Responsibility and
Managerial Ethics – Organization’s Culture – Source,Types
of Organization.

WHAT IS MANAGEMENT?
 Efficiency
 “Doing things right”
Getting the most output for the least inputs
 Effectiveness
 “Doing the right things”
Attaining organizational goals

WHAT IS MANAGEMENT?
Management is a problem solving process of effectively
achieving organizational objectives by effective
utilization use of scarce resources in a changing
environment.
Management is thus the process of planning, organising,
staffing, directing and controlling human efforts to
achieve organizational objectives effectively.

DEFINITIONS OF MANAGEMENT
“ Management is the process of designing & maintaining an
environment in which individuals, working together in
group, efficiently accomplish selected goals.”
- Koontz and Weihrich
“Management is the art of knowing what you want to do
and then seeing that it is done in the best and cheapest
way.”
- F.W.Taylor

IMPORTANCE OF MANAGEMENT
 Optimum and profitable utilization of resources.
 Effective leadership and motivation.
 Establishing sound industrial relations.
 Achievement of goals and objectives.
 Change and growth.
 Improves standard of living.

FUNCTIONS OF MANAGEMENT

PLANNING
 The first and the most important function of management is
Planning.
 Planning involves setting objectives in advance, a goal which is
to be achieved within a stipulated time.

 Planning is the most basic function of management. It is
deciding in advance what to do and how to do when to do
and by whom it is to be done.
 All the other functions of management like organising,
staffing, directing, controlling are dependent on planning.
Planning is related to future and is a continuous process.
 “Planning is deciding in advance what is to be done .When
a manager plans, he projects a course of action for the
future, attempting to achieving a consistent, coordinated
structure of operation aimed at desired result”

IMPORTANCE OF PLANNING
 Planning increase efficiency.
 Planning reduces business related risks.
 Planning provides direction.
 Planning helps in motivation.
 Planning helps in decision making.
 Planning helps to achieve objectives.
 Planning provides basis of control.

STEPS IN PLANNING PROCESS
 Establishing verifiable goals.
 Establishing Planning Premises.
 Deciding the Planning Period.
 Finding alternative course of action.
 Evaluating and selecting a course of action.

ORGANISING
“Organising is the process of identifying and grouping the
work to be performed defining and delegating responsibility
and authority and establishing relationships for the purpose
of enabling people to work most effectively together in
accomplishing objectives”
After planning the next function of management is
organising. Organising involves division of work among
people whose efforts must be coordinated to achieve
specific objectives and to implement pre-determined
strategies.

IMPORTANCE OF ORGANISING
 It facilitates efficient management.
 It facilitates coordination and communication.
 It facilitates growth and diversification.
 It ensures optimum use of resources.
 It provides for optimum use of technological innovations.
 It facilitates specialization.

STAFFING
“Staffing involves manning the organization structure
through proper and effective selection appraisal and
development of personal to fill the roles designed into the
structure.”
The staffing function deals with the human elements of
management. The staffing function has assumed great
importance these days because of rapid advancement of
technology, increasing size of organizations and complex
behavior of human beings.

IMPORTANCE OF STAFFING
 Helps in finding efficient worker.
 Helps in increased Productivity.
 Maintains Harmony.
 Helps in morale boosting.
 Helps in Optimum utilization of human resources

DIRECTING
“Direction is the interpersonal aspect of managing by which
subordinates are led to understand and contribute effectively
and efficiently to the attainment of enterprise objectives.”

IMPORTANCE OF DIRECTING
 Initiates action.
 Creates a Sound work environment.
 Develops managers.
 Behavioral satisfaction.
 Increase in productivity.
 Achieves coordination.
 Facilitates control.
 Facilitates change.
 Facilitates growth.

CONTROLLING
“Controlling is the process of checking whether or not
proper progress is being made towards the objectives
and goals and acting if necessary, to correct any
deviation”
Controlling is seeing that actual performance is guided
towards expected performance .All other functions of
management cannot be completed effectively without
performance of the control function.

IMPORTANCE OF CONTROLLING
 Basis of future action.
 Facilitates decision making.
 Facilitates discipline and order.
 Facilitates Coordination.
 Facilitates motivation.
 Effective plan Implementation

WHAT IS MEAN BY MANAGERS?
Managers play critical roles across different business
settings.Whether providing leadership for a department or
an entire business, managers may be responsible for
creating and implementing strategies, directly overseeing
shift workers or ensuring projects are completed on time
and within budgetary parameters.

TYPES OF MANAGERS

 Top Managers are responsible for the company in general,
and the way it performs and an example is the president of
the company.
 Middle Managers are considered a lower level in
comparison to top managers, they are either responsible
for large departments or smaller divisions.
 The lowest level of management is team
leaders or supervisors, which are individuals responsible
for smaller groups of individuals.

MANAGERIAL ROLES
To meet the many demands of performing their functions,
managers assumes multiple roles. A role is an organized
set of behaviors.
Henry Mintzberg has identified ten roles common to
work of all managers
The ten roles are divided into three groups:
1. Interpersonal Role.
2. Informational Role.
3. Decisional Role.

MANAGERIAL ROLES

Interpersonal Role
The interpersonal roles link all managerial work together.The
three interpersonal roles are primarily concerned with
interpersonal relationships.
Figurehead Role: The manager represents the organization
in all matters of formality. The top level manager represents
the company legally and socially to those outside of the
organization. The supervisor represents the workgroup to
higher management and higher management to the workgroup

Leader Role: The leader role defines the relationship
between the manager and the employee.
Liaison Role: In the liaison role, the manager interacts with
peers and people outside the organization. The top-level
manager uses the liaison role to gain favours and information,
while the supervisor uses it to maintain the routine flow of
work.

Informational Role
Monitor Role: In the role of a monitor, the manager receives
and collects information. The information collected, by scanning
the environment, facilitates managerial decision-making function.
Disseminator Role: In the role of a disseminator, the manager
transmits special information into the organization.The top-level
manager receives and transmits more information from people
outside the organization than the supervisor.
Spokesperson Role: The manager disseminates the
organization's information into its environment. Thus, the top
level manager is seen as an industry expert, while the supervisor
is seen as a unit or departmental expert

Decisional Role
Entrepreneur Role: The manager seeks and identifies
opportunities to promote the needed change. He is also
involved in the development and implementation of a change
strategy.
Disturbance Handler Role: The manager deals with threats
to the organization. This role equips the manager to take
corrective actions needed to resolve important, unexpected
disturbances. He must seek solutions to various unanticipated
problems like a strike, accidents and so on.

Resource Allocator Role: In the resource allocator role,
the manager chooses as to where the organization will
expend its efforts. This role deals with allocation of scarce
resources to various requests. Specific activities include
developing and monitoring budgets, forecasting future
resource needs and handling problems in acquiring them.
Negotiator Role: The manager negotiates on behalf of the
organization. The top-level manager makes the decisions
about the organization as a whole, while the supervisor
makes decisions about his or her particular work unit

Managerial Skills

Conceptual Skill
Conceptual skills refer to the ability to visualize the entire
picture of an organization’s environment i.e internal and
external. It is the ability to analyze and diagnose complex
situations or problems.This skill especially needs in the top
level of management because this skill help the top-level
managers to be properly identified, analyzed, diagnose,
anticipated, and managed the situation which is helpful to
make plans, policies, and strategies.

Human Skill
Human skills involve the ability to understand, lead,
communicate, coordinate and control the behavior of
other individuals and groups. As we know all the levels of
human resources help to bring an organization into action.
So, the manager needs knowledge and skills in the field
such as communication, motivation, conflict management,
etc. Therefore, every level of management requires the
same level of human skills.

Technical Skills
Technical skills refer to the ability and knowledge in using
the equipment, techniques, and procedures involved in
specific tasks.The first-line supervisors need the technical
skills the most because they have to see that goods and
services are produced and delivered.

Evolution of ManagementTheory

Henry Fayol and Principles of Management
1. Division of work or Specialization
2. Authority and Responsibilty
3. Discipline
4. Unity of Command
5. Unity of Direction
6. Subordination of Individual Interest to Group Interest
7. Remuneration
8. Centralization and Decentralization
9. Scalar chain
10. Order
11. Equity
12. Stability of tenure
13. Initiative
14. Espirit De Corps

Division of work
Principles of specialization necessary for efficiency in
utilizing labour. This principle states that there should be
division of work amongst the persons. Division of work
implies distribution of activities in a logical way so that
each person performs his assigned work only.There should
not be any duplication of work and for each work only
one person is held liable or responsible for his
performance.

Authority & Responsibility
Fayol defined it as the right to give orders and the power
to exert obedience. With authority comes responsibility
and accountability.

Discipline
Discipline is very important in order to smooth running of
business. It means working in an orderly manner. It
includes obedience to authority, following of instructions
and orders. It also includes observance of the rules,
regulations, procedures and methods. Further Fayol
strongly recommended that, discipline requires good
superior at all levels, clear and fair agreements and
judicious application of penalties.

Unity of Command
This principle requires that, there should be one and one
only superior for every individual employee. It means each
employee should receive instructions about a particular
work from one superior only. If an employee gets orders
from two superiors at the same time the principles of
unity of command is violated

Unity of Direction
It means there should be complete harmony between
individual and organizational goals on the one hand and
between departmental goals on the other hand. In other
words, activities of a group are assigned to manager and
manager is expected to look after all the activities of a
particular group. So each group of activities with the same
objective must have one head and one plan.

Subordination of Individual Interest to Group
Interest
This principle expected the reconciliation of individual
interest with group interest. Every organization has its
own interests, which are called group interest. According
to this principle employees must sacrifice their personal
interests and work for the of the organization i.e., for
group interest. Thus, an organization should employ only
individuals who are fully committed to its objectives and
are willing to readily comply with its mandates.

Remuneration
This principle advocates that remuneration to be paid to
the workers should be fair, reasonable, satisfactory &
rewarding of the efforts. The employees should get
satisfaction out of their wages. Henry fayol also
recommended other provisions for the benefits of
employees such as free education, medical & residential
facilities. He also strongly advocates that wages or salaries
should be determined on the basis of the work done by
the workers/employees, cost of living index

Centralization and Decentralization
It means all powers are vested with the top level
authorities. In other words, centralization is a situation
where all decisions are taken by top level management
authorities. On the other hand, Decentralization means
disposal of decision making authority to all the levels of
the organization.

Scalar Chain
Scalar Chain means the hierarchy of authority from the
highest executive to the lower one for the purpose of
communication. It implies chain of superiors from the
ultimate or top authority to the lower rank in the
organization. It also states the relationship of superior-
subordinate and the authority of superiors in relation to
subordinate at all levels. Scalar chain refers to the route
which the communications follow while flowing from one
level to the ultimate authority

Order
Management follows a simple principle that right place for
everything and for everyone.This is a principle relating to
the arrangement of things and people. It is applied both
material and men. In material order, there should be a
place for everything and everything should be in its place.

Equity
Equity means quality of fair treatment. It implies just, fair
and reasonable treatment. It means all the employees of
the organization are treated equally by managers.This
principle emphasizes kindness and justice in the behavior
of managers towards workers. The application of equity
requires goodness and experience in the part of managers.
Besides, it requires loyalty and devotion from subordinates.

Stability ofTenure
The security of job is an essential one because if they have
fear of insecurity of job, they cannot give more and better
work and their morale will be low it will lead higher
labour turnover. So job security must be provided by
organization to each personnel.The development and
growth of every organization depends solely on the
sincerity of workers.

Initiative
Initiative means freedom to think out and execute a plan.
Fayol emphasized that subordinates be given proper
opportunity to take initiative while making and executing
plans. According to Fayol, initiative is one of the keenest
satisfactions for an intelligent man to experience so, he
advices thee managers to give their employees sufficient
scope to show their initiative

Esprit De Corps (Union is Strength)
The means union is strength or team spirit.According to this
principle management should create team spirit among the
employees. This principle states that both the workers and
management should work together to accomplish the
objectives. The reason behind this principle is that, team
contribution is always better than individual contribution
Harmony and unity among the staff are a great source of
strength to the organization. All the employees of the
organization are put together as a team in order to achieve
the objective of the organization.

F.W.TAYLOR & SCIENTIFIC MANAGEMENT
Taylor suggested the following techniques of scientific management
1. Functional foremanship.
2. Work study
3. Scientific task planning
4. Scientific selection, placement and training of workers.
5. Standardization and simplification
6. Mental revolution
7. Taylor’s differential piece rate system.

FUNCTIONAL FOREMANSHIP
F.W.Taylor felt that it was not possible to get in one man
“the combination of brain, education, technical skill and
other qualities necessary to handle all the requirements
of an operating job. He advocated functional foremanship
to supervise workers. According to this technique the
task of supervision is divided into several specialized
functions and each function is entrusted to a special
foreman. Under this system eight persons are involved to
direct the activities of the workers.

WORK STUDY
Work study refers to the systematic critical assessment of
efficiency required to do the job. It varies from one job to
another job.Work study eliminates wasteful and unnecessary
operations, reduces effort and increases productivity. To
determine fair days work the following studies are used.
1. Time study
2. Motion study
3. Method study
4. Fatigue study

SCIENTIFICTASK PLANNING
It means allotment of work to each worker on the basis of the
capacity of an average worker functioning in normal working
conditions. It ensures quality of output.
 Routing: - It is concerned with the sequence of production
operations.
 Scheduling: - It prescribes deadlines for each work.
 Dispatching:- It is concerned with issuing orders to carry out
the work.
 Feedback:- It helps to check whether the work has been done
as planned.

SCIENTIFIC SELECTION, PLACEMENT AND
TRAINING OF WORKERS
Taylor emphasized the need for scientific selection and
development of the worker. He said that the
management should develop and train every worker to
bring out his best faculties and to enable him to do a
higher more interesting and more profitable class of
work than he has done in the past.

STANDARDIZATION & SIMPLIFICATION
Standards are set up in respect of tools and
equipment, period of work, working conditions, quality
of raw material, use of standard instruments, standard
raw materials, maintaining good working conditions
and proper work periods with sufficient rest time will
add production capacity of workers and management.

MENTAL REVOLUTION
Scientific management depends upon mutual cooperation
between management and the workers. This calls for a
fundamental change in thinking on the part of both
management and workers.

TAYLOR’S DIFFERENTIAL PIECE RATE
SYSTEM
Differential piece rate refers to a system in which
efficient and inefficient workers are paid at different
rates. According to Taylor, financial incentives acts as
motivators and scope of extra earnings motivates the
worker to put extra efforts. So Taylor developed the
concept of ‘Differential piece rate system’. Incentive is
directly linked with the productivity.

MANAGING IN GLOBAL ENVIRONMENT

SOCIAL RESPONSIBILITY
Social responsibility is an ethical framework in which an
individual is obligated to work and cooperate
with other individuals and organizations for the
benefit of the community that will inherit the world
that individual leaves behind.

Generally, corporate social responsibility initiatives are
categorized as follows
1. Environmental responsibility
Environmental responsibility initiatives aim to reduce
pollution and greenhouse gas emissions and the sustainable
use of natural resources.
2. Human rights responsibility
Human rights responsibility initiatives involve providing fair
labor practices (e.g., equal pay for equal work) and fair trade
practices.

3. Philanthropic responsibility
Philanthropic responsibility can include things such as
funding educational programs, supporting health initiatives,
donating to causes, and supporting community
beautification projects.
4. Economic responsibility
Economic responsibility initiatives involve improving the
firm’s business operation while participating in sustainable
practices – for example, using a new manufacturing process
to minimize wastage.

MANAGERIAL ETHICS
Managerial ethics is a set of principles and rules dictated
by upper management that define what is right and what is
wrong in an organization. It is the guideline that helps
direct a lower manager's decisions in the scope of his or
her job when a conflict of values is presented.

ORGANIZATION CULTURE
“Organizational culture is a system of informal rules that
spells out how people have to behave most of the time. It
relatively a uniform perception held by the organization”.
The environment of any organization defines the culture,
and is very crucial for the entities that make up the
organization.Their behaviour, attitude and performance are
directlyinfluenced by the culture although it varies from
person to person.

SOURCES OF ORGANIZATION CULTURE
 The personal and professional characteristics of people
within the organization
 Organizational ethics
 The property rights that the organization gives to
employees
 The structure of the organization.

TYPES OF ORGANIZATION CULTURE
1. Normative Culture
2. Pragmatic Culture
3. Academy Culture
4. Baseball team Culture
5. Club Culture
6. Fortress Culture
7. Tough Guy Culture
8. Bet your company Culture
9. Process Culture

THANKYOU

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