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BASIC OF MANAGEMENT
MOHIT DHINGRA (LECTURER)
RAJIV GANDHI GOVT. POLYTECHNIC,
NARWANA
(TEXTILE DESIGN)
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MANAGEMENT
MANAGEMENT:-
Management is getting things done through others. The job of management is not only to provide
dynamic leadership, but also to exercise a positive influence to make the future events favorable
for the enterprise. Management provides new ideas, imaginations and vision to the group
working and integrates is efforts in such a manner so as to account for better results.
IMPORTANCE OF MANAGEMENT
Management is the real force behind production. The success of an organization largely depends
upon management. The importance of a good management is due to the following reasons.
1. Tough competition in the market
The growing industrial competition has necessitated that maximum economy should be obtained
in production.
2. Production efficiency
A good and scientific management is a dynamic force behind an industry. It helps in increasing
plant efficiency by reducing wastage of time, material and money.
3. Industrial peace
The most important factor for the success of an organization is the industrial peace. This prevents
strike, lock-outs etc.
4. Limited financial resources
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Due to limited financial resources, it is very essential that factors of production are controlled
effectively.
5. Expansion of industries
As the size of an industry increase resulting in increased labour, machinery, and building it
becomes essential to concentrate more on proper management to hardest the benefits of large
scale production.
PRINCIPLES OF MANAGEMENT
Principles of management working for the good management.
1. Division of work
It means dividing the work amongst different persons best suited for different job according to
their knowledge, experience and skill.
2. Authority and responsibility
These are inter-related, responsibility refers to all duties or activities which must be done to carry
cut a job. The authority is an individual right to the make decisions and takes any active needed
to complete the responsibility. Responsibility without authority or vice-versa is meaningless.
3. Discipline
It means respect and obedience to rules, regulations, policies and procedures by all members of
the organization.
4. Unity of command
Unity of command states that an individual should receive orders form and report directly to only
one superior. In other words, a worker should not be under the control of more than one
supervisor.
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5. Centralization of authority
It means the authority is in the hands of one central point in the organization.
6. Scalar chain
It is a chain of superiors from the highest to the lowest rank.
7. Remuneration (price)
It means the price paid to the employees for services rendered by them for the enterprise.
8. Initiative
It is freedom to think, plain and execute in a worker which is essential for improving efficiency
of the organization.
FUNCTION OF MANAGEMENT
The primary organizational objective of an industry may be production, financing and
distribution of produced goods. For the achievement of the pre-decided target in the industry, the
management has to perform the following functions:-
1. PLANNING
2. ORGANISING
3. STAFFING
1. PLANNING
Planning means deciding in advance what is to be done in future. It involves thoughts and
decisions pertaining to a future course of action. Before doing any work, it is essential to know
that what the work is? How, when and where the work is to done and who is to do the work is to
bs done and who os to do the work? Thus planning is done with the aim of deciding the future
course of action.
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Planning gives a business organization its objectives and sets up the best procedure for achieving
them. The planning should aim at elimination men, machinery & capitals.
2. ORGANISING
Merely planning is not managing a business. It includes bringing together the executive personal,
workers, capitals, machinery, materials, physical facilities and others thing to execute plans.
Thus organizing involves bringing together the manpower and material resources for the
achievement of the goal set by the enterprise. It also involves assigning responsibilities to the
managers and delegating authority to each manager to accomplish the work in a planned manner.
3. STAFFING
Staffing involves manpower. In other words we can say Planning and manpower management. In
simple words, staffing function includes preparing inventory of personnel available, requirement
of personal, their selection, remuneration training and development and periodic appraisal of
personal working in the enterprise.
Staffing function is a complex and different function because it is concerned with human
resources of an organization. The main aim of the staffing in right “man for right job”.
The staffing consists of the following
1. Man power planning
2. Recruitment, selection and training
3. Development, promotion, transfer and appraisal
4. Determination of employee remuneration
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Hierarchical management structure:-
The Hierarchical management structure is as follows:
1. Top level management
2. Middle level management
3. Lower level management
Top level management
Top level management is the head of the organization of the shareholders i.e. board of directors,
chief executives and senior executives. The top level management is the ultimate source of
authority in the company. The top level management is also responsible to the shareholders of
the company. The top level management not only decided the long term objectives and policies
of the company, but it also approves the overall organization of the company. The top level
management also raises and borrow the capitals.
Hierarchical management
Middle level management
Top level management lower level management
Senior supervisor intermediate super. Front line supr.
Dept. manager or sectional officers
Purchase personal producing sales finance marketing
Board of director Chief executives i.e. senior executives e.g. President, managing vice presidentor deputy
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Director or general manager general manager
Middle level management:
Middle level management serves as a link between the top level management and lower level
management. It comprises of departmental heads or section officers of purchase, personal,
production, sales, finance and marketing. It helps the top level management to accomplish the
objective of the business and also controls and supervises lower level management. The
important functions of middle level management are as follow:-
To co-operate in making a smooth functioning of organization.
To establish co-ordinate between the different level of management.
To build up a contended and efficient staff.
Lower level management:
Lower level management consist of office superintended formen and supervisors etc. these
persons are just above the operational staff and their main function is to get the work done from
the operational staff as per from the operational staff as per specifications and procedure laid
down by middle level management. They are also responsible for maintaining high morale
among the worker.
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ORGANISATION STRUCTURE:
The organization selects and combines the efforts of men of proper characteristics so as the
product desired results. The types of organization depend on the size and nature of enterprise.
Different types of organization structure are as follow:-
1. Line organization
2. Functional organization
3. Line and staff organization
Line organization:
The line organization is known as sealer organization, vertical organization, departmental
organization etc. under this superior subordinate further delegates its authority to another and this
process goes on. This is known as line authority. This type of organization structure can be
divided into two parts:
Pure line organization
Departmental line organization
General Manager
Finance manager work manager marketing manager
Production manager purchase manager personal manager
Production supt. (X) Production supt.(Y) Production supt.(Z)
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Foreman Foreman Foreman Foreman
Worker
Advantages of the line organization:
Simplicity
Fixed responsibility
Proper discipline
Flexibility
Prompt decision
Development
Stability
Disadvantage of line organization:
Excessive work load
Lack of specialization
Lack of co-operation
Not fit for large organization
Functional organization:
Under this type of organization the whole task is divided on the basis of the work involved. The
normal operations to be performed in an organization are production, personal, purchase, finance
and research and development. These activities are assigned to various departments and
functional experts are appointed to look after these activities.
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Board of directors
Chief executive
Personal Manager Finance Manager
Production Manager Sale Manager
Prod. Control Manager Plant Service Manager
Advt. Manger prod. Sales Manger
Factory Manager Factory Manager A realer Manager A realer Factory Manager
Advantage of functional organization:
Specialization
Flexibility
Large scale production
Prospects of promotion
Better supervision
Disadvantage of functional organization:
Lack of co-ordination
Low employee morale
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Expensive
LINE AND STAFF ORGANISATION:
The line organization concentrates too much-on control, where as the functional organization
divides the control too much. The line and staff organization is a combination of vline and
functional organization. Under this type of organization, staff persinnels are provided advisory
start positions.
The personal staff
The specialist staff
The general staff
Share holders
Board of directors
Chief executives
Assistant to chief executives
Personal mangr. Production chief accountant
Plant Supdt.
Quality control inspector repairs and maintainer officers
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Forman inspector foreman pilot plant foreman laboratory
Workers Workers Workers
Advantage of line and staff organization:
Specialization
Sound decisions
Advancement opportunities
Excellent training medium
Better discipline
Disadvantage of line and staff organization:
Lack of co-ordination
Expensive
DIFFERENCE B/W LINE, LINE AND STAFF AND FUNCTIONAL ORGANIZATION
AT A GLANCE:
The following explains the difference b/w line, line and staff and functional organization:
Point of difference Line organization Line and staff
organization
Functional
organization
Simplicity Very simple Simple Complicated
Work load on High work load Moderate work load Uneven work load
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Manager
Suitability Suitable for all types
of enterprise
Suitable for large and
medium size
enterprise
Suitable for lager
enterprise
Economy Highly economical Moderately eco. Not economically
Unit of command It is strictly observed Unity of command in
case of staff officers is
not followed
The principle is
violated
Specification Spec. is low Spec. is medium Spec. is high
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DEPARTMENTATION
Departmentation is the manner in which the activities are decided to be divided and formed into
specialized group is usually referred as Departmentation. It means and involves grouping of
activities into several Departmentation is a useful activity. It increases the operating skill. The
grouping of activities is possible on any pf the following ways:
By functions
By products by regions
By processes
By customers
By an appropriate combination
Departmentation by function :
Under the pattern of Departmentation of all functions of similar types are separated and
grouped into four basic functional departments: finance, sales, production and accounting.
General Manager
Production marketing financia
Advantage:
It follows the principle of specialization.
It maintains power and prestige.
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It facilitates the co-ordination of departmental level.
Disadvantage:
It may lead to excessive centralization of authority.
The control may be defectives.
Its utility is limited.
Departmentation by products:
It enterprise products a large numbers of products, then the closely related products in a products
line can be organized in a product Department and an executive can be assigned all the
responsibilities relating to that group of products.
General Manager
Asstt. Manager products(X) Asstt. Manager products(Y) Asstt. Manager products(Z)
Product supdt. Product supdt. Product supdt.
Sale officer Sale officer Sale officer
Accountant Accountant Accountant
Advantages:
It user specialization
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It assists in co-ordination
It gives opportunity for all round ability.
Disadvantage:
It involves duplication of service function.
It results into increased managerial and operating costs.
It may cause annoyance and confusion to the customer particularly where they do not like
different salesman from the same enterprise.
Departmentation by regions:
It is also known as geographical Departmentation. It involves grouping of the primary activities
of business in different geographical regions to be served by the concern.
General Manager
Mangr northern zone mangr southern zone mangr eastern zone manger western zone
Products Products Products Products
Finance Finance Finance Finance
Sales Sales Sales Sales
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Advantage:
It enables the concern to exploit local market effect.
It encourages local perticipantation in decision making.
It provides face to face communication.
Disadvantage:
It leads to duplication of many routine and service functions.
It requires more persons with general managerial abilities.
It is costly and not fit for small scale organization.
Departmentation by process:
It is also known as Departmentation equipments. Its organization structure can be as follow:
General manager
Manager spg. Manager weg Manager Dyeing Manager packing &sales
Advantages:
It is a scientific method.
It is economical in operation.
The maintains of the department is facilitated.
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Disadvantage:
It is costly
It is suitable for large organization
It requires more space
It involves more investment.
Departmentation by customer:
The grouping of activities of enterprise on the basis of customers is called Departmentation by
customers.
General Manager
Production Manager finance Manger sales Manager
Asstt. Manager Asstt. Manager Asstt. Manager Asstt. Manager
(retailing) (wholesale) (instilment selling) (export)
Advantage:
It satisfies the wide and various needs of customers.
It is suitable for large scale products.
Disadvantage:
It is difficult in co-ordination
Its utility is limited as all activities can’t be organized
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WORK CULTURE
Organization culture:
Culture may be defined as the interactive aggregate of common characteristics which influences
a human group’s response to its environment.
Importance of organization culture:
The study of organization culture is important due to the following reasons:
People in organizations come from different cultural backgrounds having different religious,
customs, beliefs, standards, preferences etc.
No organization can work in isolation to its cultural environment depends upon its unique
cultural values such as collective, decision making, respect for seniority, concerns for employees
etc. a management style should not be imposed blindly in any organizations.
COMPONENTS OF ORGANISATION CULUTRE:-
The important components which collectively represent the organization culture are as follow:
Structure of authority:
The authority should be clearly defined in the organization. Everybody should known who is
responsible to whom.
Freedom :-
If the individuals in the organizations are given sufficient freedom to work and use authority, the
efficiency in operations will improve.
Job satisfaction:
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Job satisfaction is also an important component of the organization culture.
Morel :
Morel may be defined as the aggregate of feelings, attitudes and sentiments of organization
members towards the organization, superiors, and sub-ordinates. If the morel is high, there will
be an atmosphere of co-operation in the organization.
ATTITUDES:
The term attitude is widely used in the business and profession today. Both employer and
employee, customer and buyer have different attitudes. The attitude is important due to the
following:-
1. A right attitude can move a person towards the best goal.
2. A right attitude can give right direction to the persons.
VALUES:
The terms ‘values’ mean standards regarding the field of art, culture, profession etc. values is a
belief of a person that what is right and what is wrong.
IMPORTANCE OF VALUES:
Values are necessary for us a part of the society. In business, they play pivotal role because of
the following reasons:
Values become guide for the employee’s decisions in the business.
Value driven organizations are sure to be successful in long run.
Values become the strong motivator for the people working in the organization.
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TYPES OF VALUES:
Intrinsic value;
A value which has worth due to itself is called intrinsic individual value. These values are
cherished by the person himself.
Extrinsic value:
A value which is a mean to some other value is called extrinsic value. These values are
temporary in nature.
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value
acts as a guide
strong motivator
helps in decision making
helps in introaction
form the policies and rules
values are forever
gives rise to co-ordination
brings co-ordination
necessary for the sucess of organisation
credubility with public
Productive value:
A value that goes up with its use is called productive value.
ETHICAL BEHAVIOUR
Ethical refers to a system to moral principles, a sense of right and goodness and badness of
actions and results.
Ethical behavior related to society:
Ethics helps men to live better and perfect life. Without ethics, no social, economical, political
and religious or professional institution can serve the people rightly.
Ethical behavior related to stake holders:
The company deals with customer’s shareholders and suppliers.
Internal policy:
A third category is called internal policy. The employment contract with the workers and
employees should be fair.
INDIVIDUAL BEHAVIOURS:
An individual behavior means how an employee or an individual behaves and reacts in a
particular situation.
To understand self or any other individual and his behavior is a challenge in itself. That is
why, it has been right said that the success of any organization depends upon the efficiency of
the managers how they understand that the understanding of human behavior.
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Factors affecting individual behavior
Factor affecting individual behavior
Personal environmental organization
Biographical learned characteristic economic leadership
Socio- cultural reward system
Political organization strand design
Physical personality
Age perception
Religion attitude
Marital status value
experience
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LEADERSHIP AND MOTIVATION
LEADERSHIP:
Leadership has been defined by davis as follow:
Leadership is the ability to persuade other to seek defined objectives enthusiastically. It is
the human factor which binds a group together and motivates it towards goal.
Types/styles of leadership
Leadership styles are the pattern of behavior which a leader adopts in influencing the
behavior of his followers in the organizational matters. These are three styles of leadership:
1. Autocratic leadership
2. Democratic leadership
3. Laisse-faire
Autocratic leadership
This is also known as autocratic or directive style. In this style, a manager cartelized decision-
making power in him. The structures the complete work situation for his employees and they do
what they are told.
In this type of leadership, the following have no hand in the formation of policies.
The main characteristics of this style are as follow:
The leader makes all the decisions and demands obedience from the people.
All policies are determined by the leader without consulting the subordinates.
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The leader decides the particular work/ task for a person and the work companion of each
person.
In this system, decisions can be takes quickly.
Democratic leadership
This style is also called democratic, consultative or idiographic. A democratic manager
decentralizes his decision making process.
The main characteristics of this style are as following:-
Sub-ordinates know the long term plans on which they are supposed to work.
Thus they are kept well informed.
They share the responsibility with the superior and try to safe guard t=him also.
It provides organizational sterility due to high morale and favorable attitudes of
the employees.
Laisee-faire:
Cccc group members perform everything.
A laisee-faire leader avoids power and responsibility. Such a leader depends largely upon the
group to establish its own goals and decisions.
NEED OF LEADERSHIP
Leadership is an important factor for making the organisation successful. Here we means
manager as a leader. Without a good leader, organisation can’t functional efficiebtly and
effectively.
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Any organization is basically a deliberate creation of human beings for certain specified
objectives. The following points highlight the need of leadership for an organization.
To motivate employees:
Motivation is necessary for work performance. Higher the motivation, better would bs
performance. A good leader by exercising his leadership motivation the employees for high
performance and to achieve best results.
To create confidence:
A good leader may creat confidence in his followers by directing them, giving them advice
and getting good results through them.
To build morale:
Morale is expressed as attitude of employees towards organization management and voluntary
co-operation to offer their ability to the organization.
FUNCTIONS OF A LEADER:
The functions of a leader in an organization depend upon the type of organization and its
objectives. The function also varies from situation to situation. The following are some functions
which a leader has to perform in general:
To define objectives:
The leader clearly defines the objectives of the organization to the workers.
To prepare plans:
The leader makes plans and makes his sub-ordinates clearly understand the line of action
to excite these plans.
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To guide and co-ordinate:
The leader in an organization guides his followers and co-ordinates their efforts in such a
way that the desired goal of the organization is achived.
MOTIVATION:
The term motivation has been derived from the word motive. Motive may be defined as an
inner state of our mind that moves or activates and directs our behavior towards our goal.
CHARACTERISTICS OF MOTIVATION:
On the basis of various definitions of motivation, we can derive the following characteristics of
motivation.
Motivation is a psychological concept which is inherent in every person.
Persons in totality, not in part, is motivated.
Motivation is the strength of work. Which leads to do or not to do a work.
Motivation causes good directed from mental strength.
IMPROTANCE/NEED OF MOTIVATION IN AN ORGINAZATION
The primary task of a manager is to maintain an organization. To do so, he must be ensure that
his subordinates work efficiently and produce results which are beneficial to the organization.
The capacity to work and willingness to work are two different things. A man can be physically,
mentally and technically fit to work, but he may not be willing to work. Hence, these arises the
need of motivation.
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Thus performance is determined by two factors level of ability or capability to do certain work
and level of motivation. This can be expressed in the following way.
Performance= ability * motivation
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JOB SATISFACTION
The job satisfaction is the result of various attitudes which the employee holds towards his job.
Job means work allotted to a person. The people do different job to earn livelihood. If a worker is
satisfied with his job, he will be happy and will do his work efficiently and sincerely. Some of
the important parameters of job satisfaction are as follow:-
Good salary
Good working conditions
Job security
Opportunities for career advancement
Good management
Worker’s participation in management
MEASURES OF JOB SATISFACTION
There is no set method of measuring the satisfaction of employees. However, the following
factors can give some indication:-
1. Morale:
The survey conducted by the management to find morale of the workers gives idea about
the level of job satisfaction.
2. Productivity:
The increase or decrease in the productivity over a certain period reveals the interest of
workers in job and gives an idea about the job satisfaction level.
3. Labor turnover:
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The unsatisfied workers leave the organization frequently. Labor turnover ration also
indicates degree of job satisfaction.
4. Accidents:
The increasing number of accidents is also an indication of low level of job satisfaction
among workers.
5. Absenteeism:
An unsatisfied employee tends to remain absent from duty more frequently as from duty
more frequently as compared to satisfied one.
MOTHED TO INCREASE JOB SATISFACTION:
The following factors are responsible for increasing job satisfaction among workers.
Job security
Paid leaves and rests
Education facilities for children
Equal wages for equal work
Time promotions on merit
Good working condition
Other fringe benefits
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LEGAL ASPECTS OF BUSINESS
LABOUR WELFARE
Labor welfare refers to the services and facilities extended to the workers by the employer and
other agencies.
WAGES
Wages may be defined as the remuneration paid under contractby an employer to an employee
for the work performed by him.
Wages may also be defined as the price of labor hired or employed.
TYPES OF WAGES
Wages are of following types:-
Monitory or normal wages
Real wages
Minimum wages
Living wages
Fair wages
MONITORY OE NOMIAL WAGES:
Monitory wages is the amount of money paid by an employer to an employee for the work
performed by him.
REAL WAGE:
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Real wage is the amount of money paid by the employee to an employee plus the money value of
all the facilities like free accommodation, free transportation, free food, free education for his
children etc. hence, real wages are higher than nominal wages.
MINIMUM WAGES:
The wages which are paid to the workers to keep them alive are called minimum wage.
LIVING WAGES:
The wages which can meet the requirements of workers like food, cloths medicial facilities,
insurance; house, education to children etc. are called living wages.
FAIR WAGE:
The wages which are sufficient to fulfill the basic necessities of life are called fair wages. Fair
wages depend upon the location of industry availability of workers etc.
INCENTIVES:
Incentive is a monetary reward given to a worker for his efficiency and hardwork.
NEED OF INCENTIVES:
Incentives are needed due to the following reasons:-
BETTER PRODUCTION:
It is the main aim of any industry to have large production in order to meet the growing
competition in the market.
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BETTER EFFICIENCY:
Incentives help to increase the plant efficiency by making effective use of equipment and
materials by the workers.
QUALITY OF PRODUCTION:
We know that the competition in the market is increasing day by day which calls for better
quality of the product. This can properly motivated with proper increasing.
LABOUR LAWS:
The laws framed by the government for safeguarding the economic and social interests of the
workers in the factories are called labor laws or industrial laws.
NECESSITY OF LABOUR LAW
The labor laws are required due to following reasons:
To help in payment of fair wages to the workers.
To minimize and setting of the industrial disputes.
To reduce the conflicts, strikes etc.
To provide good working conditions for the workers.
To fix hours of work, rest interval etc.
VARIOUS INDUSTRIAL ACT.
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The following are the various industrial acts or labor laws enacted from to time for the welfare of
the workers:-
Factories act, 1948
Workmen’s compensation act, 1923
Employee’s state insurance act, 1948
Minimum wage act, 1936
Payment of wages act, 1936
Employee’s provident fund act, 1952
FACTORIES ACT. 1948
This act regulates conditions of workers in factories. Factories act, 1948 is a comprehensive
piece of legislation covering all aspects regarding the factories. This extends to the whole of
India including the state of Jammu and Kashmir. It come into force on 1st April, 1949
SCOPE:
According to factory act, 1948, “factory means a working place under one management when 10
or more than 10 persons are normally working with power aid (help) or 20 or more than 20
persons are working without power aid. This act prohibits the employment of chindren below the
age of 14.
NECESSITY:
Before the enactment of factories act, 1948 the employers were free to use the labor in the
manner they liked. The result was that the workings were exceptionally long. Women and
children workers were exploited.
SALIENT FEATURES OF THE FACTORIES ACT, 1948
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The followings are the important provision of the factories act, 1948:-
Licensing and registration
Health
Safety
Welfare
Hours of work
Employment of young persons
Leave.
LICENSING AND REGISTRATION:
As per this act, the occupier or holder of a factory shall at least 15 days before he beings to
occupy or use any premises as a factory, send to the chief inspector of factories a written nitice
containing the details regarding.
Name and address of the occupier
Name and address of the proposed factory name of manufacturing process
Power to be used
Number of worker likely to be employed
So before starting the factory, the permission is to be taken.
HEALTH:
Section 11 to 23 contained in chapter III of the factories act, 1948 deal with the health of the
workers in a factory. The provision is detailed guidelines about the following:-
Cleanliness
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Disposal of waste and effluents
Ventilation and temperature
Dust and fumes
Artificial humidification
Over crowding
SAFTEY:
Fencing of machinery
Work on or near machinery in motion
Hoists and lifts
Pressure plants
Excessive weights
Protection of eyes etc.
WELFARE:
Washing facilities
Facilities for sitting’
First aid facilities
Canteens
Crèche
Shelters, rest rooms and lunch rooms
Welfare offices
WORKING HOURS:
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Main provisions in the act dealing with working hours are as follow
DAILY HOURS
No adult worker shall be required to work in a factory for more than 9 hours.
No worker shall be required to work for more than 5 hours continuously i.e. after 5 hours
the worker shall have a rest for at least half an hour.
WEEKLY HOURS
An adult worker shall be required to work in a factory for not more than 48 hours a week.
EMPLOYMENT OF YOUNG PERSONS:
A child who has no completed his fourteenth year is prohibited from working in any factory.
LEAVE
Every worker who has worker foir 240 days or more during calendar year shall be allowed leave
with wages during the subsequent calendar at the rate of :-
One day for every 15 days of work performed by a child worker
One day for 20 days of work performed by an adult worker
MINIMUM WAGES ACT 1948
Granting minimum wages to the worker is one of the essential requirements. The wage should
be sufficient to maintain the worker and his family.
SCOPE:
This act is applicable to all employees engaged in employment speed in the schedule.
NRCESSITY:
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The purpose of this act is to prevent exploitation of unduly low wages.
The workers are poorly organized and they cannot fight with the employees for
reasonable wages.
To fix the minimum wages and making it obligatory for the employer to the worker.
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