Management- Introduction

By:- Ranjana Singh

Assistant Professor of Mgmt

UWSL

Evolution of Management ConceptAdam Smith :- In his book of “The Wealth of the Nations

(1776) he suggested Division of Labour”

Classical Approaches:- 1. Scientific Management- (F.W.Taylor; H.L Gantt, Frank

Gilberth, Lillian Gilberth) 2. Theory of Bureaucracy-Max Weber 3. Administrative Management- Henri Fayol

Neo-Classical Approaches:- 1. Hawthorne Studies and Human Relations Movement 2. Behavioral Approach

Evolution of Management Concept

Modern Approach:-

1. Quantitative Management (Mathematical Techniques)

2. Systems Approach

3. Contingency Approach

Frederick W Taylor (1856-1915)F.W Taylor- Founder of Scientific Management

Movement.Four principles to increase efficiency in the workplace:- 1. Determine one best way to do the job

2. Select the best persons for the job

3. Train the best person on most efficient method of perform inperforming the task.

4. Provide sufficient monetary incentives

Criticism to Scientific Management

Emphasizes only on muscular tasks at floor level and neglects the areas of problem solving & decision-making, which are of key importance at other managerial levels.

Only Economic incentives are not enough to motivate workers for increased production.

Time and motion study is not entirely scientific.Tends to create monotony (because of doing the same

task every time) and confusion (because of getting orders from multiple foremen) in work culture.

Fayols 14 Management Principles Division of Labor Authority and Responsibility Discipline Unity of Command Unity of direction Centralization Subordination of individual interests to the general interests Remuneration Scalar chain Order Equity Stability of tenure of personnel Initiative Esprit de corps

Criticism to Fayol’s Administrative Principles

Division of labor creates dissatisfaction among the employees because each individual carries out his assigned part as something apart from the overall purpose of the organization as a whole.

Simons criticism on contradictory principles like Division of Labour (Principle of Specialization) and Unity of Command.

Principles are mere work of case studies and hardly empirically proven. E.g. Dale found considerable variation in span of control of Chief Executive as against 6 given by Urwick.

Continued…

These principles are often stated as unconditional statements of what ought to be done in all circumstances when what is needed are conditional principles of management. E.g. as per study conducted by Burns & Stalker, in Authority & Responsibility can’t be explicit in technologically turbulent environment.

These principles are based on the assumption that organizations are closed systems.

Max Weber’s Theory of Bureaucracy

Max Weber, a German sociologist is known as Father of Bureaucracy.

Identified 3 basic types of administration prevailing business and government organizations:-

1. Leader oriented

2. Tradition oriented

3. Bureaucratic

Theory of Bureaucracy-Features

There is insistence on following Standard rules.There is Systematic Division of Work.Principle of Hierarchy is followed.It is necessary for the individual to have knowledge

and training in the application of rules.Administrative Acts, Decisions and Rules are Recorded

in Writing.There is Rational Personnel Administration.

Limitations of Bureaucracy

Overconformity to rulesBuck-passingTrained incapacityDisplacement of goals (E.g. Development of

“Professional Automation” in the organizational culture)

No real right of appealNeglect of informal groupsRigid structure Inability to satisfy the needs of mature individuals

Neo-Classical Approacha) Human Relations Movement

Basically based on the Hawthorne Experiments conducted by Prof. Elton Mayo

At Western Electric Company, Illinois from 1927 to 1932.

Study was conducted in following four parts:-

1. Illumination Experiments

2. Relay Assembly Test Room

3. Interviewing Programme

4. Bank Wiring Test Room.

Limitations of Human Relations Movement

As much incomplete as the Scientific Management and Administrative Management Approaches.

For organizations to satisfy everybody in the system is not possible.

Over-emphasizes the importance of symbolic rewards and underplays the role of material rewards.

Provides an unrealistic picture about informal groups.This approach is in fact production oriented and not employee-

oriented as it claim to be.This approach is based on a wrong assumption that satisfied

workers are more productive.This approach makes an unrealistic demand on superior to give

up his power.

Outline:-

Definition of ManagementCharacteristics of ManagementObjectives of ManagementSignificance of ManagementFunctions of ManagementProcess of ManagementLevels of ManagementManagers Role

Definitions:- Production or efficiency oriented:- “Management is the art of knowing what you want to do and then seeing

that it is done in the best and cheapest way” ~ Taylor

People-oriented:- “Art of getting things done through people”. ~ Mary Follett “Management is the art of getting things done through and with people in formally organized groups”. ~ Harold Koontz Function-Oriented:- “To manage is to forecast and to plan, to organize, to command, to co-

ordinate and to control”. ~ Henri Fayol

Decision-oriented:- “Management is simply the process of decision making and control over the

action of human beings for the expressed purpose of attaining pre-determined goals.” ~ Stanley Vance

Characteristics of Management:-Management is an integrating processManagement is a universal processManagement is a group activityManagement is goal orientedManagement is a dynamic processManagement is a social processManagement is intangibleManagement is art, science and professionManagement is irreplaceableManagement is based on certain principlesManagement is multi-disciplinary

Objectives of Management:-Two levels management objectives are:-

1. Micro level – The Enterprise LevelMaximum result with minimum inputsEnsuring maximum prosperity for both – Employers and

Employees

2. Macro level – The Society Level To contribute to economic growthTo Ensure high standard of livingTo generate employment opportunitiesTo maintain healthy industrial relationsTo convert challenges into opportunities

Nature of ManagementNature of ManagementSource: Robert Kreitner, Management, Houghton Mifflin, Boston,

2007

Importance/Significance of Management:-

Optimum utilization of resourcesLeadership and motivation Initiative and innovationMinimizes wastage Industrial peaceBuilds competitive strength Improves Standard of LivingGrowth, Expansion and DiversificationSocial Consciousness

Functional Areas of Management:-

Production Management / Operations ManagementMarketing ManagementHuman Resource ManagementFinancial ManagementAdministrative ManagementOther Functions

Levels of Management:-

Top management’s roleTop management’s roleNaveen Jindal acquired control over the ailing

Raigarh plant of the Jindal group when his father, Om Prakash Jindal, arranged an amicable four-way split of his business empire between his four sons in 1998.

Naveen Jindal's remarkable turnaround of the Raigarh sponge iron mill through a backward integration strategy led JSPL to cheaply acquire access to valuable raw materials such as coal and iron ore at a time when competitors were paying much less attention to these inputs.

This strategy insulated JSPL from price volatility in commodity markets, thus bringing down production costs and boosting profitability.

Upper /Top Management:-

1. Set Objectives

2. Scan Environment

3. Plan and make decisions

Middle Management

1. Report to top management

2. Oversee first line managers

3. Receive general strategies/policies from top managers

4. Translate the strategies into specific goals for first line mgrs

Lower Management/First-line Managers

1. Directly Responsible for the Production of Goods/Services

2. Ensures the work team meet performance objectives

3. Need strong technical expertise for day to day operations.

The Role of Managers. By Prof Henry Mintberg

Liaison in ManagementLiaison in Management

Changes influencing Management

Global warming and Environmentalism Internet and e-businessTechnological change Changing workforce demographic changeEthical awakening and social innovationGlobalization and Intense competitionRestructuring of Organizational Structure