MGT162 Chapter 1 Powerpoint

management: [email protected]: [email protected]

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11stst Question Question

Why do we study Why do we study management?management?


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We study management because ...We study management because ...•To understand the skills, challenges, expected problems, To understand the skills, challenges, expected problems, etc. for future use in our career.etc. for future use in our career.•Help us to become effective manager. To achieve high Help us to become effective manager. To achieve high level of performance through better utilization of human level of performance through better utilization of human and material resources.and material resources.•To equip us with effective management theories and To equip us with effective management theories and practices.practices.•Learn to detect problems and solve them (good decisions).Learn to detect problems and solve them (good decisions).•Enable to access future and make plan for it (good Enable to access future and make plan for it (good planner).planner).•Awareness of responsibilities and are accountable.Awareness of responsibilities and are accountable.•For our own consumption.For our own consumption.


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22ndnd Question Question

What is What is management?management?


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Management is …Management is …

““The art of getting things done The art of getting things done throughthrough people”people”

…….. .. Mary Parker FolletMary Parker Follet

““Management is the systematic Management is the systematic organization oforganization of economic resources”economic resources”

……. . Peter DruckerPeter Drucker


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Management is …Management is … ““To manage is to forecast and plan, to organize, to To manage is to forecast and plan, to organize, to

command, to co-ordinate and to control”…. command, to co-ordinate and to control”…. HenryHenry Fayol (1916)Fayol (1916)

““Management is a process … the process consists of Management is a process … the process consists of planning, control, co-ordination and motivation” …. planning, control, co-ordination and motivation” …. E.F.L Brech (1957)E.F.L Brech (1957)

““Managing is an operational process initially best Managing is an operational process initially best dissected by analyzing the managerial functions; dissected by analyzing the managerial functions; planning, organizing, staffing, directing, leading and planning, organizing, staffing, directing, leading and controlling” …. controlling” …. Koontz & O’Donnel (1984)Koontz & O’Donnel (1984)


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Management is …Management is … Essentially … Management is about:Essentially … Management is about:

organizing people organizing people organizing resources organizing resources

productively to the mutual benefit both of productively to the mutual benefit both of the organization as a whole and the the organization as a whole and the individual employees.individual employees.

The manager should see him/her as The manager should see him/her as facilitating this process.facilitating this process.


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Management is …Management is … The “The “MsMs” of Management…..” of Management…..

MMoneyoney MMachineryachinery

MManpoweranpower MMaterialsaterials

MMoraleorale MMethodethod


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33rdrd Question Question

What is What is

the the goalgoal of of management?management?


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The goal of management is …The goal of management is …

To achieve some To achieve some specific purposesspecific purposes


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Management is ….Management is ….• A set of activities:A set of activities:

• planning and decision making, organizing, leading, planning and decision making, organizing, leading, and controllingand controlling..

• directed at an organization’s resources:directed at an organization’s resources:• human, financial, physical, and informationhuman, financial, physical, and information..

• with the with the aimaim of achieving organizational goals of achieving organizational goalsin an efficient and effective manner.in an efficient and effective manner.


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44thth Question Question

Why is management Why is management important?important?


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management is important because ...management is important because ... It is essential for the success of a business of It is essential for the success of a business of

enterprise.enterprise. “…“….. Without management there would be only a .. Without management there would be only a

mob rather than institution.” … mob rather than institution.” … Peter DruckerPeter Drucker.. The manager is the The manager is the dynamicdynamic, life giving element in , life giving element in

every organization. Without his leadership, the every organization. Without his leadership, the resources of production remain resources and never resources of production remain resources and never become production.become production.

In a competitive economy, above all, the In a competitive economy, above all, the QualityQuality & & PerformancePerformance of managers determine the success of of managers determine the success of business … indeed they determine business … indeed they determine SURVIVALSURVIVAL!!

QualityQuality + + PerformancePerformance of managers is the effective of managers is the effective advantage of organization.advantage of organization.


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Successful management..Successful management.. Besides doing all the functions, managers have to Besides doing all the functions, managers have to

be able:be able: To look ahead and assess future realistically.To look ahead and assess future realistically. To have imagination.To have imagination. Be able to make decisions based on sound Be able to make decisions based on sound

understanding and judgment of the available understanding and judgment of the available data.data.

Able to communicate effectively with their Able to communicate effectively with their subordinates, superiors and peers.subordinates, superiors and peers.

To motivate, inspire and guide their staff so To motivate, inspire and guide their staff so that everyone works together to achieve the that everyone works together to achieve the organization’s goals and targets.organization’s goals and targets.


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Management successManagement success

The most effective manager is the one who is The most effective manager is the one who is concerned with both people and production.concerned with both people and production.

Effective management should be measured by:Effective management should be measured by: What he/she achieves not what is done!What he/she achieves not what is done!

EFFICIENTEFFICIENT – capable, able to perform duties – capable, able to perform duties well.well.

EFFECTIVEEFFECTIVE – having an effect, able to bring – having an effect, able to bring result intended.result intended.


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Peter Drucker says……….Peter Drucker says……….

““Effectiveness is the key to an Effectiveness is the key to an organization’s success. Before we can organization’s success. Before we can focus on doing things efficiently, we focus on doing things efficiently, we need to be sure we have found need to be sure we have found the right the right things to dothings to do””


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EfficiencyEfficiencyversusversus

EffectivenessEffectiveness

Source: Van Fleet, David D., Contemporary Management, Second Edition. Copyright © 1991 by Houghton Mifflin Company. Used with permissions.


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Basic Purpose of ManagementBasic Purpose of Management

EFFICIENCYEFFICIENCY ““doing things rightdoing things right””

The ability to do things rightThe ability to do things right

Is an ‘input – output’ conceptIs an ‘input – output’ concept Using resources wisely and in a cost-effective wayUsing resources wisely and in a cost-effective way An efficient manager is one who achieves outputs or An efficient manager is one who achieves outputs or

results that measures up to the inputs (labor, materials results that measures up to the inputs (labor, materials and time) used to achieve them.and time) used to achieve them.

Managers who are able to minimize the cost of the Managers who are able to minimize the cost of the resources needed to achieve goals are acting resources needed to achieve goals are acting efficientlyefficiently..


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Basic purpose of managementBasic purpose of management

EFFECTIVENESSEFFECTIVENESS ‘doing the right things’

Making the right decisions and successfully implementing them

A manager who selects an appropriate goals (say) producing mainly large cars when the demand for small cars are soaring, is an inefficient manager, even if the large cars produced with the maximum efficiency.


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What is a Manager?What is a Manager? Someone whose primary responsibility is to Someone whose primary responsibility is to

carry out the management process.carry out the management process. Someone who plans and makes decisions, Someone who plans and makes decisions,

organizes, leads, and controls organizes, leads, and controls human, financial, physical, human, financial, physical, and information resources.and information resources.


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Kinds of Managers by Level and AreaKinds of Managers by Level and AreaLevels of Management

Mar

ketin

g

Admin

istra

tion

Other

Human

reso

urces

Operat

ions

Finan

ce

Middle managers

Areas of Management

First-line managers

Top managers


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Kinds of Managers by LevelKinds of Managers by Level Top ManagersTop Managers

The relatively small group of executives who manage the The relatively small group of executives who manage the organization’s overall goals, strategy, and operating organization’s overall goals, strategy, and operating policies.policies.

Middle ManagersMiddle Managers Largest group of managers in organizations who are Largest group of managers in organizations who are

primarily responsible for implementing the policies and primarily responsible for implementing the policies and plans of top managers. They supervise and coordinate the plans of top managers. They supervise and coordinate the activities of lower-level managers.activities of lower-level managers.

First-Line ManagersFirst-Line Managers Managers who supervise and coordinate the activities of Managers who supervise and coordinate the activities of

operating employees.operating employees.


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Kinds of Managers by AreaKinds of Managers by Area Marketing ManagersMarketing Managers

Work in areas related to getting consumers and clients Work in areas related to getting consumers and clients to buy the organization’s products or services.to buy the organization’s products or services.

Financial ManagersFinancial Managers Deal primarily with an organization’s financial Deal primarily with an organization’s financial

resources.resources.

Operations ManagersOperations Managers Concerned with creating and managing the systems Concerned with creating and managing the systems

that create organization’s products and services.that create organization’s products and services.


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Kinds of Managers by Area (cont’d)Kinds of Managers by Area (cont’d) Human Resource ManagersHuman Resource Managers

Involved in human resource planning, recruiting and Involved in human resource planning, recruiting and selection, training and development, designing selection, training and development, designing compensation and benefit systems, formulating compensation and benefit systems, formulating performance appraisal systems.performance appraisal systems.

Administrative ManagersAdministrative Managers Generalists who are familiar with all functional areas of Generalists who are familiar with all functional areas of

management and who are not associated with any management and who are not associated with any particular management specialty. particular management specialty.

Other Kinds of ManagersOther Kinds of Managers Specialized managerial positions directly related to the Specialized managerial positions directly related to the

needs of the organization.needs of the organization.


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Management in OrganizationsManagement in Organizations

management process …..management process …..

Inputs from the environment• Human resources• Financial resources• Physical resources• Information resources

Planningand decision

making

Leading

Organizing

Controlling

Goals attained• Efficiently• Effectively


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The Management ProcessThe Management Process Process to emphasize that all managers regardless of their Process to emphasize that all managers regardless of their

particular aptitudes or skills, engage in certain interrelated particular aptitudes or skills, engage in certain interrelated activities in order to achieve their desired goals.activities in order to achieve their desired goals.

OrganizingDetermining how

best to groupactivities and

resources

ControllingMonitoring

and correctingongoing activitiesto facilitate goal

attainment

Planning andDecision Making

Setting the organiza-tion’s goals and

deciding how bestto achieve them

LeadingMotivating membersof the organizationto work in the best

interests of theorganization


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The Management Process (cont’d)The Management Process (cont’d) Planning and Decision MakingPlanning and Decision Making

Setting an organization’s goals and selecting a course of Setting an organization’s goals and selecting a course of action from a set of alternatives to achieve them.action from a set of alternatives to achieve them.

OrganizingOrganizing Determining how activities and resources are grouped.Determining how activities and resources are grouped.

Leading Leading The set of processes used to get organizational members The set of processes used to get organizational members

to work together to advance the interests of the to work together to advance the interests of the organizationorganization..

ControllingControlling Monitoring organizational progress towards goals.Monitoring organizational progress towards goals.


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What is an What is an organization?organization?


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an organization is …an organization is … “ …“ …. is a social unit in which two or more people . is a social unit in which two or more people

interact to achieve a common goal or set of goals” interact to achieve a common goal or set of goals” --- --- StonerStoner

“…“…. is a collection of people working together in a . is a collection of people working together in a division of labor to achieve a common purpose” division of labor to achieve a common purpose”

------SchermerhornSchermerhorn “ …“ …. is the structure of relationships that exists . is the structure of relationships that exists

when two or more people mutually cooperate to when two or more people mutually cooperate to pursue common objectives” pursue common objectives”

--- --- HoltHolt


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What are the What are the common common

characteristics of characteristics of organization?organization?


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Common characteristics of organization :Common characteristics of organization : Each organization has a distinct Each organization has a distinct purposepurpose.. Each is composed of Each is composed of peoplepeople.. All organizations develop a All organizations develop a systematicsystematic

structurestructure that defines and limits the behavior that defines and limits the behavior of its members, including:of its members, including: Creating rules and regulations.Creating rules and regulations. Identifying some members as managers and give Identifying some members as managers and give

the authority over other members.the authority over other members. Writing job descriptions so that members know Writing job descriptions so that members know

what they are supposed to do.what they are supposed to do.


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Why do we need Why do we need organization?organization?


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we need organization …we need organization …

To accomplish objectivesTo accomplish objectives Examples? Private/public/non-profit organization.Examples? Private/public/non-profit organization.

To preserve knowledgeTo preserve knowledge Examples? Educational organizations, museum, Examples? Educational organizations, museum,

archive, etc.archive, etc.

To serve societyTo serve society Examples? Private/public/non-profit organization.Examples? Private/public/non-profit organization.

To provide careers/employmentTo provide careers/employment


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What are the types What are the types of organization?of organization?


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Types of organizationTypes of organization

Formal OrganizationFormal Organization Consists of two or more people who are Consists of two or more people who are

involved in a mutual effort with formal involved in a mutual effort with formal authority to achieve common authority to achieve common goals/objectives;goals/objectives; or or

Is the system of jobs, authority Is the system of jobs, authority relationships, responsibility, and relationships, responsibility, and accountability designed by management accountability designed by management to get the work doneto get the work done..


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Types of organizationTypes of organization Informal OrganizationInformal Organization

consists of two or more people involving in a consists of two or more people involving in a mutual effort mutual effort withoutwithout a deliberate structures of a deliberate structures of authority or the necessity of common objectives.authority or the necessity of common objectives.

is considered as is considered as shadow organizationshadow organization.. exists in every organization.exists in every organization. it is it is not plannednot planned.. it just happened based on it just happened based on friendshipfriendship and and

contactscontacts both on and off the job. both on and off the job. it is a it is a networknetwork of personal and social of personal and social

relationships that may have nothing to do with relationships that may have nothing to do with formal authority relationships.formal authority relationships.


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What types of skill What types of skill do managers need?do managers need?


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Managerial skillsManagerial skills

Skills and the ManagerSkills and the Manager


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Managerial skillsManagerial skills

TechnicalTechnical Skills necessary to accomplish or understand the Skills necessary to accomplish or understand the

specific kind of work being done in an organization.specific kind of work being done in an organization. Interpersonal or Human Interpersonal or Human

The ability to communicate with, understand, and The ability to communicate with, understand, and motivate both individuals and groups.motivate both individuals and groups.

ConceptualConceptual The manager’s ability to think in the abstract.The manager’s ability to think in the abstract.

DiagnosticDiagnostic The manager’s ability to visualize the most appropriate The manager’s ability to visualize the most appropriate

response to a situation.response to a situation.


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Managerial skillsManagerial skills CommunicationCommunication

The manager’s abilities both to convey ideas and The manager’s abilities both to convey ideas and information effectively to others and to receive ideas information effectively to others and to receive ideas and information effectively from others.and information effectively from others.

Decision-MakingDecision-Making The manager’s ability to recognize and define problems The manager’s ability to recognize and define problems

and opportunities correctly and then to select an and opportunities correctly and then to select an appropriate course of action to solve the problems and appropriate course of action to solve the problems and capitalize on opportunities.capitalize on opportunities.

Time-ManagementTime-Management The manager’s ability to prioritize work, to work The manager’s ability to prioritize work, to work

efficiently, and to delegate appropriately.efficiently, and to delegate appropriately.


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Management Skill Mixes at Different Management Skill Mixes at Different Organizational LevelsOrganizational Levels


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Is management Is management science or art?science or art?


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Management: Science or Art?Management: Science or Art? The Science of ManagementThe Science of Management

Assumes that problems can be approached using Assumes that problems can be approached using rational, logical, objective, and systematic ways.rational, logical, objective, and systematic ways.

Requires technical, diagnostic, and decision-making Requires technical, diagnostic, and decision-making skills and techniques to solve problems.skills and techniques to solve problems.

The Art of ManagementThe Art of Management Decisions are made and problems solved using a blend Decisions are made and problems solved using a blend

of intuition, experience, instinct, and personal insights.of intuition, experience, instinct, and personal insights. Requires conceptual, communication, interpersonal, Requires conceptual, communication, interpersonal,

and time-management skills to accomplish the tasks and time-management skills to accomplish the tasks associated with managerial activities.associated with managerial activities.


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What are the roles What are the roles of manager?of manager?


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Managerial Roles (Mintzberg)Managerial Roles (Mintzberg)


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Managerial Roles (Mintzberg)Managerial Roles (Mintzberg)a)a) Interpersonal RoleInterpersonal Role

1)1) FigureheadFigurehead Symbolic head; obliged to perform a number of Symbolic head; obliged to perform a number of

routine duties of a legal or social nature such as routine duties of a legal or social nature such as greeting visitors, signing legal documents, etc.greeting visitors, signing legal documents, etc.

2)2) LeaderLeader Responsible for the motivation and activation of Responsible for the motivation and activation of

subordinatessubordinates Responsible for staffing, training and associated Responsible for staffing, training and associated

dutiesduties Performing virtually all activities that involve Performing virtually all activities that involve

subordinates.subordinates.


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Interpersonal Role (contd.)Interpersonal Role (contd.)

3)3) LiaisonLiaison Maintains self-developed network of outside Maintains self-developed network of outside

contacts and informers who provide favors contacts and informers who provide favors and information.and information.

Acknowledge mail; doing external board Acknowledge mail; doing external board work and performing other duties that involve work and performing other duties that involve outsiders.outsiders.


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b)b) Informational RoleInformational Role

4)4) MonitorMonitor Seeks and received wide variety of special Seeks and received wide variety of special

information (much of it current) to develop information (much of it current) to develop through understanding of organization and through understanding of organization and environmentenvironment

Emerges as nerve centre of internal and Emerges as nerve centre of internal and external information about the organization.external information about the organization.

Activities: reading periodicals and reports; Activities: reading periodicals and reports; maintaining personal contacts.maintaining personal contacts.


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Managerial Roles (Mintzberg)Managerial Roles (Mintzberg) Informational Role (contd.)Informational Role (contd.)

5)5) DisseminatorDisseminator Transmits information received from other Transmits information received from other

subordinates to members of organization.subordinates to members of organization. Activities; holding informative meetings; making Activities; holding informative meetings; making

phone calls to relay information.phone calls to relay information.

6)6) SpokerspersonSpokersperson Transmits information to outsiders on organization’s Transmits information to outsiders on organization’s

plans, policies, actions, results, etc.plans, policies, actions, results, etc. Serves as expert on organization’s industry.Serves as expert on organization’s industry. Activities; holding board meeting; giving information Activities; holding board meeting; giving information

to the media, etc.to the media, etc.


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Managerial Roles (Mintzberg)Managerial Roles (Mintzberg)c)c) Decisional RoleDecisional Role

7)7) EntrepreneurEntrepreneur Searches organization and its environment for Searches organization and its environment for

opportunities and initiates ‘improvement projects’ to opportunities and initiates ‘improvement projects’ to bring about change.bring about change.

Activities; organizing strategy and review sessions to Activities; organizing strategy and review sessions to develop new programs.develop new programs.

8)8) Disturbance HandlerDisturbance Handler Responsible for corrective action when organization Responsible for corrective action when organization

faces important, unexpected disturbances.faces important, unexpected disturbances. Organizing strategy and review sessions that involve Organizing strategy and review sessions that involve

disturbances and crisis.disturbances and crisis.


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Managerial Roles (Mintzberg)Managerial Roles (Mintzberg) Decisional Role (contd.)Decisional Role (contd.)9)9) Resource AllocatorResource Allocator

Responsible for the allocation of organizational Responsible for the allocation of organizational resources of all kinds – in effect, the making or resources of all kinds – in effect, the making or approval of all significant organizational decisions.approval of all significant organizational decisions.

Activities; requesting authorization; performing any Activities; requesting authorization; performing any activity that involves budgeting and programming of activity that involves budgeting and programming of subordinates work.subordinates work.

10)10) NegotiatorNegotiator Responsible for representing the organization at Responsible for representing the organization at

major negotiationsmajor negotiations Activities; participating in union contract Activities; participating in union contract

negotiations.negotiations.


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What are Fayol’s 14 What are Fayol’s 14 Principles of Principles of

Management?Management?


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Fayol’s 14 Principles of ManagementFayol’s 14 Principles of Management1.1. Division of workDivision of work

Specialization of tasks (necessary for greater Specialization of tasks (necessary for greater efficiency and productivity)efficiency and productivity)

2.2. AuthorityAuthority The right to give orders and responsibilityThe right to give orders and responsibility

3.3. DisciplineDiscipline Outward marks of respect in accordance with Outward marks of respect in accordance with

formal or informal agreements between firms formal or informal agreements between firms and its employees.and its employees.


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Fayol’s 14 Principles of ManagementFayol’s 14 Principles of Management4)4) Unity of commandUnity of command

Employees should receive orders from only one Employees should receive orders from only one superior.superior.

5)5) Unity of directionUnity of direction One head and one plan for a group of activities with One head and one plan for a group of activities with

the same objective (entire organization should be the same objective (entire organization should be moving toward a common objective, in a common moving toward a common objective, in a common direction).direction).

6)6) SubordinationSubordination The interest of one individual or one group should not The interest of one individual or one group should not

prevail over the general good. This is difficult area of prevail over the general good. This is difficult area of management; i.e. the interest of one person should not management; i.e. the interest of one person should not take priority over the interest over the interests of the take priority over the interest over the interests of the organization as a whole.organization as a whole.


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Fayol’s 14 Principles of ManagementFayol’s 14 Principles of Management7.7. RemunerationRemuneration

Pay should be fair to both the employee and the Pay should be fair to both the employee and the employer.employer.

8.8. Centralization/DecentralizationCentralization/Decentralization The extent to which authority is concentrated or The extent to which authority is concentrated or

dispersed.dispersed.

9.9. Scalar ChainScalar Chain The line of authority from the top to the bottom of the The line of authority from the top to the bottom of the

organization (hierarchy).organization (hierarchy).

10.10. OrderOrder The arrangement of things and people (the right man The arrangement of things and people (the right man

at the right place).at the right place).


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Fayol’s 14 Principles of ManagementFayol’s 14 Principles of Management11.11. EquityEquity

Combination of kindness and justice towards Combination of kindness and justice towards employeesemployees..

12.12. Stability TenureStability Tenure Employees need to be given time to settle into their Employees need to be given time to settle into their

jobs, even though this may be a lengthy period in case jobs, even though this may be a lengthy period in case of managersof managers..

13.13. InitiativeInitiative All staff are encouraged to show their initiativeAll staff are encouraged to show their initiative..

14.14. Esprit de corpsEsprit de corps Team spirit and morale built by the management Team spirit and morale built by the management

(harmony is a great strength to the organization).(harmony is a great strength to the organization).


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Ending…Ending…

Hope you Hope you understand the understand the

topics discussed!topics discussed!

MGT162 Chapter 1 Powerpoint

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