CHAPTER 1
NATURE
AND SIGNIFICANCE OF MANAGEMENT
Question. Define the term ‘Management’.
Answer.
Management is used to mean the group of persons
who manage the organisation. It is needed every time and in every activity. It
is not only confined to business organisations but also in organisations such
as government, religious, charitable bodies etc.-
Traditional
definition:
According
to the traditional view “Management is getting things done through others”.
This is incomplete as it treats the employees as mere means to achieve the
goals of the organisation. Needs and demands of the employees of the
organisation are overlooked.
Modern
definition:
According
to the modern view “Management is creating the internal environment of an
organization where employees working together in groups can perform efficiently
towards the achievement of the goals. On this basis Management is goal oriented
and involves creating an internal atmosphere so that group goals can be
achieved.
Question. “A successful enterprise has to achieve its
goals effectively and efficiently.” Explain.
Answer.
Management has been defined as a process of
getting things done with the aim of achieving goals effectively and efficiently
Being
effective or doing work effectively basically means finishing the given task.
Effectiveness in management is concerned with doing the right task, completing
activities and achieving goals. In other words, it is concerned with the end
result.
But
it is not enough to just complete the tasks. Completing task efficiently is
also important. Efficiency means doing the task correctly and with minimum
cost. There is a kind of cost-benefit analysis involved and the relationship
between inputs and outputs. If by using less resources more benefits are
derived then efficiency has increased. Efficiency is also increased when for
the same benefit or outputs, fewer resources are used and less costs are incurred.
Management is concerned with the efficient use of the available resources,
because they reduce costs and ultimately lead to higher profits.
For
management, it is important to be both effective and efficient. Effectiveness
and efficiency are two sides of the same coin.
Usually
high efficiency is associated with high effectiveness which is the aim of all
managers. But undue emphasis on high efficiency without being effective is also
not desirable.
Question. Explain the characteristics/features of
Management.
Answer.
Key characteristics of management are given
below: -
(i)
Management is a goal-oriented process: An organisation has a set of basic goals
which are the basic reason for its existence. These should be simple and
clearly stated. Different organisations have different goals. Commonly
managerial success is measured by the extent to which the objectives are
achieved
(ii)
Management is all pervasive: Management is relevant for all types of
organization whether economic, social or political. A petrol pump needs to be
managed as much as a hospital or a school. What managers do in India, the USA,
Germany or Japan is the same.
(iii)
Management is multidimen-sional: Management is a complex activity that has
three main dimensions. These are:
(a)
Management of work: All organisations exist for the performance of some work.
In a factory, a product is manufactured, in a garment store a customer’s need
is satisfied and in a hospital a patient is treated. Management translates this
work in terms of goals to be achieved and assigns the means to achieve it.
(b)
Management of people: Human resources are an organisation’s greatest asset.
Managing people has two dimensions (i) it implies dealing with employees as
individuals with diverse needs and behavior; (ii) it also means dealing with
individuals as a group of people. The task of management is to make people work
towards achieving the organisation’s goals, by making their strengths effective
and their weaknesses irrelevant.
(c)
Management of operations: Every organisation has some basic product or service
to provide in order to survive. This requires a production process which has
the flow of input material and the technology for transfor-ming this input into
the desired output for consumption. This is interlinked with both the
management of work and the management of people.
(iv)
Management is a continuous process: The process of management is a series of
continuous, composite, but separate functions (planning, organising, directing,
staffing and controlling). These functions are simultaneously performed by all
managers all the time.
(v)
Management is a group activity: An organisation is a collection of diverse
individuals with different needs. Every member of the group has a different
purpose for joining the organization. Management implies group of persons
working in association for the achievement of common objectives. The result of
group efforts affects all the person of the group.
(vi)
Management is a dynamic function: Management is a dynamic function and has to
adapt itself to the changing environment. An organisation interacts with its
external environment which consists of various social, economic and political
factors. In order to be successful, an organisation must change itself and its
goals according to the needs of the environment.
(vii)
Management is an intangible force: - Management cannot be seen. One may not see
with the naked eye the functioning of management, but its presence can be felt
through orderliness, enthusiastic employees, and adequate work output. Quite
often, the identity of management is brought in focus by its absence or by the
presence of its direct opposite, mismanagement.
Question. What are the objectives of the Management?
Answer.
Management Objectives can be classified into
three major categories: Organisational, Social and Individual. A brief
description about each objective is given below.
(i)
Organisational Objectives: Management should be basically concerned with
utilizing human and material resources available to an enterprise for deriving
best results. This leads to reduction in costs and maximum prosperity for the
organization by generating high profits. Organisational objectives must take
care of the interests of all the stakeholders in a fair and just manner. The main
organizational objectives are survival, profit and growth.
Survival:
The basic objectives of any business is survival. In order to survive, an
organisation must earn enough revenues to cover costs.
Profit:
Mere survival is not enough for business. Management has to ensure that the
organisation makes a profit. Profit provides a vital incentive for the
continued successful operation of the enterprise.
Growth:
A business needs to add to its prospects in the long run, for this it is
important for the business to grow. An organization can grow and expand only if
it moves in the predetermined direction. An effective management helps in
achieving the objectives but also proves the way for growth and expansion
(ii)
Social objectives: - Social objectives deal with the commitment of an
organization toward society. Such objectives may be pertaining to health,
safety, labour practices, and price regulation. Further, they include
activities intended to further social and physical improvement of the community
and to contribute to desirable civic activities. It should be noted that most
business houses in achieving their primary goals also contribute to their
respective communities by creating needed economic wealth, employment and
financial support to the community.
(iii)
Personal objectives:- Individual objectives are pertinent to the employees of
the organization. Each employee joins an organization to satisfy his needs by
working in the firm. These objectives might include competitive salary,
personal growth and development, peer recognition and societal recognition. In
the absence of satisfaction of personal objectives, employees may lose interest
in the work and the performance of the organizational objectives may suffer.
Question. What is the importance of Management in modern
business?
Answer.
Management is very much needed for the survival
of the business. Without proper management resources will remain resources and
shall never become production. Management is important for the following
reasons
1.
Helps in achieving group goals: Management is a group activity. It co-ordinates
the efforts of organizational members so as to achieve the predetermined
objectives of the organization.
2.
Management increases efficiency: The aim of a manager is to reduce costs and
increase productivity through better planning, organising, directing, staffing
and controlling the activities of the organisation.
3.
Management creates a dynamic organisation: All organisations have to function
in an environment which is constantly changing. It is generally seen that
individuals in an organisation resist change. Management helps people adapt to
these changes so that the organisation is able to maintain its competitive
edge.
4.
Management helps in achieving personal objectives: A manager motivates and leads
his team in such a manner that individual members are able to achieve personal
goals while contributing to the overall organisational objective.
5.
Management helps in the development of society: An organisation has multiple
objectives to serve the purpose of the different groups that constitute it. It
helps to provide good quality products and services, creates employment
opportunities, adopts new technology for the greater good of the people and
leads the path towards growth and development.
Question. Management is both a science and an art.
Explain.
Answer.
Some authors describe management as an art
because management relates to practical application knowledge and skill as per
the needs of a given situation. On the other hand there are authors who regard
management as science because management represents a body of well-tested
principles, which can be universally applied. Management as a Science and
Management as an art are discussed below
Management
as a science: -
Science
is a systematized body of knowledge pertaining to a specific field of study and
contains general facts that explain a phenomenon. It establishes the cause and
effect relationship between two or more factors and have certain principles
governing the relationship. These principles are developed through the
scientific methods of observation of events and verification through testing.
The principles are absolute facts having universal application. As such science
is characterized by for main features.
(i)
Existence of systematized body of knowledge.
(ii)
Use of scientific methods of observation.
(iii)
Principle based on experiments.
(iv)
Universal validity of principles.
On
examination we find that while management has some of these features and it
does not have others. For instance management is systematized body knowledge.
Also principles of management are arrived on the observation and repeated
experimentation in various types of organizations. But the methods of
observation followed by management are not cent percent objective because the
subjects are human being whose behaviour cannot be predicted. The Management
principles are flexible and can be used in different situations with
modification. So these principles do not have universal applicability. Thus
management may be called an inexact science as is the case with other social sciences.
Management
as an art
Art
is concerned with the application of knowledge and skills. Desired results are
achieved through the application of skill. Thus an art has the following
characteristics. :
(1)
It signifies practical knowledge.
(2)
It signifies personal skills in particular fields of human activity.
(3)
It helps in achieving desired/ predetermined results.
(4)
It is creative in nature.
Management
is also an art since it involves application of knowledge and personal skills
to achieve desired results. Every manager has to apply certain knowledge and
skills while dealing with the people to achieve the desired results. As an art
management calls for a combination of abilities, skills and judgment and a
continuous practice of management concepts and principles.
Management:
Both science and an art
Management
is combination of an organized body of knowledge and skilful application of
this knowledge. Effective performance of various management functions
necessarily needs an adequate basis of knowledge and a scientific approach.
Thus, management is both a science and an art;. It is a science because it uses
certain principles. It is an art because it requires continuous practice and
personal skills.
From
the above discussion it is clear that management is both a science and an art.
Question. Management is a profession. Explain.
Answer.
A profession means an occupation for which
specialized skills are required. In a profession entry is restricted by
examination or education. But these skills are not meant for self-satisfaction
but are used for the large interests of the society. A profession has the
following characteristics:
1.
Well defined body of knowledge.
2.
Restricted entry.
3.
Professional association.
4.
Ethical Code of conduct.
5.
Service Motive
Management
can be referred as a profession if it fulfills the above mentioned features:-
1.
Well defined body of knowledge: Every profession has a specialized body of
knowledge relevant to the area of specialization and it can be imported through
formal methods of instructions or education. Management fulfills these
criteria. The principle and theories of management have been developed for the
existing and potential managers.
2.
Restricted entry: Entry in a profession is subject to qualifying prescribed
exams and acquired practice through training and apprenticeship. However there
are no restrictions on a person to become a manager anyone can become a manager
irrespective of education. Therefore this criterion is not fulfilled by the
management.
3.
Professional association: For every profession a representative association is
there to lay down the code of conduct and membership rules. Management also has
association such as All India Management Association, National Institution of
Personnel Management etc. However the membership to these associations is not
essential for the managers therefore this criterion is partly fulfilled by the
management.
4.
Ethical Code of conduct: Members of a profession have to abide by code of
conduct which contains rules and regulations relating to the profession any
member violating the code can be punished and the membership can be cancelled.
The All India Management Association has also framed code of conduct for the
managers but there is no legal backing for this code. Therefore management does
not fulfill this criterion.
5.
Service motive: The basic motive of a profession is to serve their client’s
interests by rendering dedicated and committed service. The basic purpose of
management is to help the organisation achieve its stated goal. This may be
profit maximisation for a business enterprise. However, profit maximisation is
not the sole objective of the management.. Therefore, if an organisation has a
good management team that is efficient and effective it automatically serves
society by providing good quality products at reasonable prices.
Conclusion:
On the basis of above discussion we find that management fulfills some of the
features of profession. Therefore it can be regarded as profession. But not
full fledged professions like legal or medical profession. But the recent
trends show that it is moving in that direction.
Question. Explain different levels of management?
Answer.
A series of managerial position from top to
bottom is called levels of management. Level of management determines the
amount of authority and status enjoyed by any manager. The levels of management
can be classified into three parts.
(i)
Top level Management
(ii)
Middle level management
(iii)
Supervisory level or operating management
TOP MANAGEMENT
Top
management consists of managers at the highest level in the management chain of
command. This includes Board of Directors, Chief executive and the departmental
heads.
Functions
of top level Management / Activities Performed by top level Management
(i)
Establishing overall long term goals and ways of attaining them.
(ii)
Maintaining liaison with the outside world
(iii)
Laying down overall policies
(iv)
Providing direction and leadership to the organization as a whole.
MIDDLE MANAGEMENT
Middle
level management consist of departmental managers, branch managers like
purchase managers, production managers, personnel manager, finance manager
marketing manager etc.
Function
of the middle level management / Activities performed by the middle level
management.
(i)
To link the top and supervisory levels of management.
(ii)
To transmit orders decisions and instructions down ward.
(iii)
To carry the problems & suggestions upward.
(iv)
To inspire lower level managers towards better performance.
(v)
To co-ordinate various units and divisions
SUPERVISORY
OR OPERATIONAL MANAGEMENT
Supervisory
/ operative / lower management consist of first line supervisors. They
generally have such designations as superintendent, section officer, foreman
etc. Following are the important functions of lower management.
(i)
Planning day today activities.
(ii)
Arranging machinery & tools etc.
(iii)
Arraigning jobs and tasks to subordinate
(iv)
Supervision of the work of labour.
(v)
Reporting the problems faced and suggestions made by workers to the middle
level management.
Question. What are different functions of management?
Answer.
Following are the functions of Management
(1)
Planning: - It is deciding in advance what to do, how to do when to do and who
is to do. It bridges the gap between where we are to and where we want to go.
It makes it possible for things to occur which would otherwise not happen.
Planning is needed for all functions and at all level of management though its
extent varies with the delegated authority or position.
(2)
Organising: - It refers to the process of bringing together physical financial
& human resources & establishing productive relations among
them for the achievement of predetermined goals. It is concerned with building
a structure of various inter-related parts. The main aim of Organising is to
enable the people to relate to each other to work together for a common
purpose.
(3)
Staffing: - The staffing may be defined as the managerial function of hiring
and developing the required personnel to fill in various positions in the
organization. This function involves determination of the size and categories
of required personnel. It is also concerned with employing the right people and
developing their skills thorough training. The staffing function focuses on
improving the competence and performance of the employees in the organization.
(4)
Directing: - It is the function of managements concerned with instructing,
guiding, supervising, motivating & leading the subordinates to
contribute to the best of their of their abilities for the achievement of
organizational objectives. It is a continuous function of the management.
(5)
Controlling: -Controlling is the process of verifying actual performance is in
conformity with planned performance & taking corrective action where
necessary. It provides that performance of work is in accordance with the
organizational plans policies & programmes. It enables managers to
detect deviations in performance if any rectify them and to prevent their
repetition in future.
Question. Define coordination.
Answer.
Co-ordination as a function of management
refers to the task of integrating the activities of separate units of on
organization to accomplish the goals efficiently. The purpose of coordination
is to ensure that the goals of units and subunits are pursued in harmony with
each other keeping in view the goals of the organization as a whole.
Question. Co- ordination is the
essence of management.
Answer. The work given to
different departments units and individual must be coordinated by all managers
at various levels as a regular function. Without proper co-ordination there is
likely to be duplications or over lapping and even chaos in the organization
co-ordination in required in performing every function of management as
follows.
(a)
In planning co-ordination is required
(i)
Between objectives and available resources and
(ii)
Among different functional managers.
(b)
In organizing co-ordination is required.
(i)
Between resources of an organization and activities to be performed.
(ii)
Among authority responsibility and accountability.
(c)
In staffing co-ordination is required
(i)
Between skills of workers and jobs assigned to them.
(ii)
Between training and technology of production.
(d)
In directing co-ordination is required
(i)
Among orders, instructions, guidelines, suggestions etc.
(ii)
Between superior and subordinates
(iii)
Between efficiency and motivation
(e)
In controlling co-ordination is required
(i)
Between standards fixed and actual performances
(ii)Between
correction of deviation and achievement of objectives.
It
is clear from the above discussion that Co-ordination is regarded as the
essence of management rather than separate function of management.
Question. Explain the nature of
coordination.
Answer. Coordination is the
process of achieving unity of action among independent activities. This would
be better achieved if the nature of coordination is understood clearly as
discussed below: -
Nature
of Coordination
The
definitions given above highlight the following features of coordination:
(i)
Coordination integrates group efforts: Coordination integrates unrelated or
diverse interests into purposeful work activity. It gives a common objective to
group effort to ensure that performance is done as per planning.
(ii)
Coordination ensures unity of action: The purpose of coordination is to secure
unity of action in the achievement of a common purpose. It acts as the binding
force between departments and ensures that all action is aimed at achieving the
goals of the organization.
(iii)
Coordination is a continuous process: It is not a one time process but a
continuous process. It starts with the establishment of business and runs up to
its closure. Maintaining coordination among various activities of business is
the essential task of managers. This should happen continuously
(iv)
Coordination is an all pervasive function: Coordination is required at all
levels of management due to the interdependent nature of activities of various
departments. It integrates the efforts of different departments and different
levels.
(v)
Coordination is the responsibility of all managers: Coordination is the
function of every manager in the organisation. Top level managers need to
coordinate with their subordinates to ensure that the overall policies for the
organisation are duly carried out. Middle level management coordinates with
both the top level and first line managers. Operational level management
(vi)
Coordination is a deliberate function: A manager has to coordinate the efforts
of different people in a deliberate manner. Even where members of a department
willingly cooperate and work, coordination gives a direction to that willing
spirit. Cooperation in the absence of coordination may lead to wasted effort
and coordination without cooperation may lead to dissatisfaction among
employees.
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