I.

FUNCTIONS OF MANAGEMENT:

Management consists of the functions given below. It is based on Henri Fayols thinking on the functions of management. 1. Planning: Planning is decision making on future course of actions. Involves taking decisions on vision, mission, values, objectives, strategies and policies of an organization. Generating plans of action for immediate, short term, medium term and long term periods. A guideline for execution or implementation. Measure to check the effectiveness and efficiency of an organization. 2. Organizing: Involves determination and grouping of the activities. Organizing the resources, particularly human resources, in the best possible manner. Defining the roles and responsibilities of the department. Defining relationships between departments and job positions. Defining authorities for departments and job positions. 3. Staffing: Includes manpower or human resource planning. Involves recruitment, selection, induction and positioning the people in the organization. Training, retraining, development, mentoring and counselling are important aspects of staffing, Also includes performance appraisals and designing and administering the motivational packages. Decisions of remuneration packages are part of staffing. 4. Directing: Translates companys plans into execution. Includes providing leadership to people so that they work willingly and enthusiastically. Communicate and coordinate with people to lead and enthuse them to work together to achieve the plans of the organization. Coordinating various people and their activities. Directing aims at achieving the best not just out of an individual but achieving the best through the groups or teams of people through team building efforts. 5. Controlling: Evaluating the progress against the plans and making corrections either in plans or in execution. Measures actual performance against the plans. Sets standards or norms of performance. Periodically reviews, evaluates and monitors the performance. If the gaps are found between execution levels and the plans, controlling function involves suitable corrective actions to expedite the execution to match up with the plans or in certain circumstances deciding to make modifications in the plans.

II.

EVOLUTION OF MODERN MANAGEMENT:

Modern Management includes: 1. Social System School 2. Decision Theory School 3. Quantitative Management School 4. System Management School 5. Contingency Management School Modern Management concept mainly divided into two classes:-1. Decision theory school: Herbert Simon, Glurk and Iyndall Urwick are the major contributors to this school of thought. The main features of this theory are as follows: 1. Decision is central to the study of organization. 2. The organization effectiveness depends on the quality of decision. 3. All factors affecting decision making are the subject matter of the study of Management. 4. The member of the organization is decision makers and problem solvers. 2. Contingency Management school / Situational approach: The latest approach to management which interact the various approaches to management is known as the contingency approach or open and adaptive systems approach. The work of Joan Woodward in the 1950s marked the beginning of this approach in management. Contingency school states that management is situational & the study of management lies in identifying the important variables in the situation. It recognizes that all the subsystem of the environment are interconnected and interrelated. By studying their interrelationship, the management can find solution to specific situation.

III. TYPES OF BUSINESS ORGANIZATION:

1. 2. 3. 4. 5. 6. Sole trader Partnership Private Limited Company (Ltd) Public Limited Company (Plc) Co-operatives Franchises

Sole Traders: A sole trader is a business that is owned by one person It may have one or more employees The most common form of ownership in the UK Can offer specialist services to customers Can be sensitive to the needs of customers since they are closer to the customer and react more quickly Can cater for the needs of local people a small business in a local area can build up a following in the community due to trust

Partnership: Business where there are two or more owners of the enterprise Most partnerships have between two and twenty members though there are examples like the major accountancy firms where there are hundreds of partners A partner is normally set up using a Deed of Partnership.

This contains: Amount of capital each partner should provide How profits or losses should be divided How many votes each partner has (usually based on proportion of capital provided) Rules on how take on new partners How the partnership is brought to an end, or how a partner leaves.

Limited company: Business owned by shareholders Run by directors (who may also be shareholders Liability is limited (important)

Differences between a private and public limited company: Shares in a plc can be traded on Stock Exchange and can be bought by members of general public Shares in a private limited company are not available to general public A private limited company may have a smaller (or larger) capital.

Co-operatives: Three main types of co-operative Examples: Co-operative Retail Society Farmers co-operatives marketing and distributing food products Small business credit unions Artists co-operatives sharing studio and exhibition facilities Retail co-ops Marketing or trader co-ops Workers co-ops

Franchises: The franchisor is the business whose sells the right to another business (franchisee) to operate a franchise Franchisor may run a number of their own businesses, but also may want to let others run the business in other parts of the country A franchise is bought by the franchisee

Once they have purchased the franchise they have to pay a proportion of their profits to the franchisor on a regular basis Depending on the business involved, the franchiser may provide training, management expertise and national marketing campaigns May also supply the raw materials and equipment.

IV. DESIGNING EFFECTIVE ORGANIZATION:

An effective organization design can make or break ones ability to achieve ones business strategy. This is particularly true in todays ever-changing environment. Larger organizations focused on market demand and market opportunity are designing their strategies to give them better market share and increased growth. At the same time, many mid-sized companies are trying to build new business functions that they know are needed to respond to specific opportunities, but they often dont know how to implement them on their own. And smaller high-growth organizations are moving from their original founder/single-owner structure to the next level and need to install new leadership and infrastructure to make that next step. No matter what their size or reason, leaders want to achieve greater success and provide enhanced value to their customers and key stakeholders. So when it comes to creating a new organization design, the development of the organizations strategy must start with these very customers and stakeholders. A successful business strategy is created by comparing current business results with the customers or stakeholders future needs. Once we define the proper strategy, we can then use it to design an effective organization structure that will enable the strategys achievement in a way that is still aligned with the organizations culture. When performing an organization redesign, one must always establish a Design Team who can help conduct the needs assessment, develop a draft of the future-state design, and ultimately drive the implementation process. When considering the composition of the Design Team, one must often include two or three members of the senior leadership team as well as one or two of the most important mid-level managers who are well-experienced in the business. This team also needs an Executive Champion to sponsor the effort. The champions role is to keep the team on course to achieve the organizations objectives. It helps to have an external facilitator and change advisor involved who is familiar with the design process as well. To avoid creating the design in a vacuum, an iterative, dynamic process is used to help the Design Team conduct their work over a series of sessions. The process starts with an assessment of the organizations current capabilities. This includes everything from work processes to business systems to the individual people and their skills anything that can provide a competitive advantage.

V.

JOINT STOCK COMPANY:

In a partnership firm we know that the number of partners cannot exceed 20. So there is a limit to the contribution of capital. Secondly, even if the partners could contribute a large amount of capital, they would hesitate to do so considering the risk involved in business and their unlimited liability. Mainly to take care of these two problems, a company form of business organisation came into existence. A company form of business organization is known as a Joint Stock Company. It is a voluntary association of persons who generally contribute capital to carry on a particular type of business, which is established by law and can be dissolved only by law. Persons who contribute capital become members of the company. This form of business has a legal existence separate from its members, which means even if its members die, the company remains in existence. This form of business organisations generally requires huge capital investment, which is contributed by its members. The total capital of a joint stock company is called share capital and it is divided into a number of units called shares. Thus, every member has some shares in the business depending upon the amount of capital contributed by him. Hence, members are also called shareholders. The companies in India are governed by the Indian Companies Act, 1956. The Act defines a company as an artificial person created by law, having a separate legal entity, with perpetual succession and a common seal. Characteristics of Joint Stock Company: 1. Association of persons: 2. Artificial person: 3. Separate legal entity: 4. Limited liability: 5. Transferability of shares: 6. Common seal: 7. Separation of ownership from management: 8. Perpetual succession: 9. Investment facilities: 10. Accountability: 11. Restricted action:

VI. PUBLIC SECTOR:

The part of the economy concerned with providing basic government services. The composition of the public sector varies by country, but in most countries the public sector includes such services as the police, military, public roads, public transit, primary education and healthcare for the poor. The public sector might provide services that non-payer cannot be excluded from (such as street lighting), services which benefit all of society rather than just the individual who uses the service (such as public education), and services that encourage equal opportunity.

Examples of public sector activity range from delivering social security, administering urban planning and organizing national defence.

The organization of the public sector (public ownership) can take several forms, including:

Direct administration funded through taxation; the delivering organization generally has no specific requirement to meet commercial success criteria, and production decisions are determined by government. Publicly owned corporations (in some contexts, especially manufacturing, "state-owned enterprises"); which differ from direct administration in that they have greater commercial freedoms and are expected to operate according to commercial criteria, and production decisions are not generally taken by government (although goals may be set for them by government). Partial outsourcing (of the scale many businesses do, e.g. for IT services), is considered a public sector model.