Principles of Management4th Year Semester - I

Principles Of Management

Module No. 1

Module No. 1 – Historical development• Define Management• Science or Art• Management and Administration• Development of Management thoughts• Contribution of Taylor and Fayol• Functions of Management• Types of Business Organization• Business Ethics and Social Responsibility• Shift to Ethics and Tools of Ethics

Definition of Management

• Management can be defined as a process of “ getting things done through the efforts of others”.

• “Getting work done with least expenditure of time, money and efforts”

Orientation of Defining Management

1. Production Oriented

2. Decision Oriented

3. People Oriented

4. Function Oriented

Production Oriented Definition

Taylor Defined “ Management is the art of knowing what you want to do and then seeing that it is done in the best and cheapest way”

Decision Oriented Definition

“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.”

People Oriented Definition

“Management is the accomplishment of results through the efforts of other people.”

Function Oriented Definition

“Management is a process involving planning, organising, staffing, directing, and controlling human efforts to achieve stated objectives in an organisation.”

Management and Administration

Approaches

1. Administration is above Management

2. Administration is a part of Management

3. Management and Administration is Same

Administration is Above Management

Administration(Policy Formulation)

Management(Policy Execution)

TOP

Lower

Functions in Organization

Organizational Level

Administration is Above Management

SRNo

Basis of Difference Administration Management

1 Level in Organisation Top level Middle and Lower

2 Major Focus Policy Formulation Policy Execution

3 Nature of Functions Determinative Executive

4 Scope of Functions Broad and Conceptual

Narrow and Operational

5 Factors affecting Decision

Mostly external Mostly Internal

6 Qualities required Administrative Technical

Administration is a Part of management

According to Brech

Administration becomes a subordinate function to overall management functions.

Administration is concerned with day-to-day function and is a part of management.

Management and Administration are same

Most Popular and Practical approach

Both involve the same functions, principles and objectives.

Management and Administration are same

Management

Board of Directors

Foreman

Management Functions

Presidents

Administra

tion

General Manager

Work Manager

Management A Science or Art

Management as a Science

1. Methods of Inquiry are systematic and empirical

2. Information can be ordered and analyzed

3. Results are cumulative and communicable.

Management as an Art

1. How a particular work can be accomplished.

2. Skill of applying principles

3. Analyse situation and make decisions

Development of Management Thoughts

Evolution of Management

1. Early Classical Approaches

2. Neo-Classical Approaches

3. Modern Approaches

Early Classical Approaches

A. Scientific Management –

• Contributed by Frederick Taylor(1856-1915)

• It has developed into a movement and dominated the industrial management

Early Classical Approaches

A. Scientific Management – Contribution

• Time and Motion Study• Differential Payment• Drastic Reorganization of Supervision• Scientific Recruitment and Training• Intimate Friendly Cooperation between

Management and Workers.

Early Classical Approaches

B. Administrative Management

• Henri Fayol (1841-1925) considered as the Father of Administrative Management

Early Classical Approaches

B. Administrative Management

1. Division of work

2. Authority and Responsibility

3. Discipline

4. Unity of Command

5. Unity of Direction

6. Subordination of Individual Interest to General Interest.

Early Classical Approaches

B. Administrative Management

7. Remuneration

8. Centralisation

9. Scalar Chain

10. Order

11. Equity

12. Stability of Tenure of Personnel

Early Classical Approaches

B. Administrative Management

13. Initiative

14. Espirit De Corps

Early Classical Approaches

C. Bureaucracy

• Leader Oriented• Tradition Oriented• Bureaucratic

Early Classical Approaches

C. Bureaucracy

In Bureaucratic management, Delegation of management responsibility is based on the person’s ability to hold the position.

Neo-Classical Approaches

A. The Human Relations Movement

Experiments of HR are divided into 4 Parts

1. illumination Experiment

2. Relay Assembly Test Room

3. Interviewing Programme

Neo-Classical Approaches

A. The Human Relations Movement

4. Bank Wiring Test Room

- Rate busters

- Chisellers

- Squealers

Neo-Classical Approaches

B. Behavioral Approach

Recognizes the Practical and Situational constraint

Self direction and control instead of imposed control.

Study leadership

Modern Approaches

A. Quantitative Approach

B. Systems Approach

C. Contingency Approach

Quantitative Approach

• Focus is on Decision making• It facilitates disciplined thinking• Tools and Techniques to be used.

System Approach

1. A system is a set of Interdependent parts

2. Central to the systems approach is the concept of ‘holism’

3. A system can be either open or closed

4. Every System has a boundary

System Approach

Transformation of Energy

Input of Information(Materials,

energy, Imports

Output of Products (Ideas,

services, export)

ENVIRONMENT

ENVIRONMENT

ORGANISATION AS AN OPEN SYSTEM

Contingency Approach

• Management principles have no general and universal applicability under all conditions.

• Organisation need to be flexible and dynamic

Functions Of Management

Functions of Management

1. Planning

2. Organising

3. Staffing

4. Directing

5. Controlling

Types of Business Organisation

• Sole Proprietorship• Partnership• HUF• Co-Operative societies• Joint Stock Company

Sole Proprietorship

• When an individual promotes, owns, finance, manages and controls a business, that type of business is known as sole traders or individual Proprietorship

Joint Hindu Family

A form of business in which all members of a Hindu undivided family do business jointly under the control of the head of the family who is known as the ‘karta’.

Other partners of HUF are called Co – Parceners.

Partnership

• A partnership is an association of two or more individuals who agrees to carry on a business together for the purpose of sharing profits.

Co-Operatives

• A society which has its objects the promotion of the economic interests of its members in accordance with co-operative principles.

• The principle are service and not profit, co-operation and not competition.

Joint Stock Company

A Joint stock company is an artificial legal person having an independent legal entity and joint capital divided into transferable shares of a fixed value.

Business Ethics & Social Responsibility

Contents

• Social Responsibility• Origin and Growth of the Concepts• Social Audit• Business Ethics

Social Responsibility

• It Refers two types of business obligations

A. The Socio-Economic Obligation

B. The Socio-Human Obligation

Origin and Growth of the Concept

A. Idea of a welfare State

B. The changing image of business

C. Changing attitude of Businessmen

Different views on Social Responsibility

1. Communist View

2. Capitalist View

3. Pragmatic View

4. Trusteeship View

Social Audit

• A social audit is a systematic study and evaluation of the organization's social performance as distinguished from its economic performance.

Business Ethics

• Business Ethics is the application of moral principles to business problems.

4 Factors affecting Ethical decisions

• Government Legislation• Business codes• Pressure Groups• Personal values of the Manager

Corporate Governance

• It is used to denote the extent to which companies run in an open and honest manner in the best interest of all stake-holders.

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