Various Definitions Given By the management thinkers and practitioners are: Management is the coordination of all resources through

the process of planning, organising, directing and controlling in order to attain stated objectives. Henry L. Sisk Management is the art of knowing what you want to do and then seeing that it is done in the best and cheapest way. F.W. Taylor To manage is to forecast and to plan, to organise to command, to coordinate and to control. Henry Fayol Management is a multipurpose organ that manage a business and manages Managers and manages Workers and work. Peter Drucker Management is a distinct process consisting of planning, organising, actuating and controlling performed to determine and accomplish the objectives by the use of people and resources. George R. Terry

Management is guiding human and physical resources into dynamic organisational units which attain their objectives to the satisfaction of those served and with a high degree of morale and sense of attainment on the part of those rendering service. American Management Association Management is the function of executive leadership anywhere. Ralph C. Davis Management is concerned with seeing that the job gets done; its tasks all centre on planning and guiding the operations that are going on in the enterprise. E.F.L. Breach

CONCEPTS OF MANAGEMENT

The term management has been interpreted in several ways : Management as an Activity Management is an activity just like playing, studying, teaching etc. As an activity management has been defined as the art of getting things done through the efforts of other people. Management is a group activity wherein managers do to achieve the objectives of the group. The activities of management are: Interpersonal activities Decisional activities Informative activities Management as a Process Management is considered a process because it involves a series of interrelated functions. It consists of getting the objectives of an organization and taking steps to achieve objectives. The management process includes planning, organising, staffing, directing and controlling functions. Management implications: as a process has the following

(i) Social Process: Management involves interactions among people. Goals can be achieved only when relations between people are productive. Human factor is the most important part of the management. (ii) Integrated Process: Management brings human, physical and financial resources together to put into effort. Management also integrates human efforts so as to maintain harmony among them. (iii) Continuous Process: Management involves continuous identifying and solving problems. It is repeated every now and then till the goal is achieved. (iv) Interactive process: Managerial functions are contained within each other. For example, when a manager prepares plans, he is also laying down standards for control. Management as an Economic Resource Like land, labour and capital, management is an important factor of production. Management occupies the central place among productive

factors as it combines and coordinates all other Manpower resources.

Money Management Materials

Machinery

Management as a Team As a group of persons, management consists of all those who have the responsibility of guiding and coordinating the efforts of other persons. These persons are called as managers who operate at different levels of authority top, middle, lower. Some of these managers have ownership stake in their firms while others have become managers by virtue of their training and experience. Civil servants and defence personnel who manage public sector undertakings are also part of the management team. As a group managers have become an elite class in society occupying positions with enormous power and prestige.

Top Management
Management

Administration

Middle Management

Lower Management

Management as an Academic Discipline Management has emerged as a specialised branch of knowledge. It comprises principles and practices for effective management of organisations. Management has become as very popular field of study.Management means the group of persons occupying managerial positions. It refers to all those individuals who perform managerial functions. For example, when one remarks that the management of Reliance Industries Ltd. is good, he is referring to the persons who are managing the company. There are several types of managers which are listed as under. (i) Family managers who have become managers by virtue of their

being owners or relatives of the owners of a company. (ii) Professional managers who have been appointed on account of their degree or diploma in management. (iii) Civil Servants who manage public sector undertakings. Managers have become a very powerful and respected group in modern society. This is because the senior managers of companies take decisions that affect the lives of a large number of people. For example, if the managers of Reliance Industries Limited decide to expand production it will create job for thousands of people. Managers also help to improve the social life of the public and the economic progress of the country. Senior managers also enjoy a high standard of living in society. SCOPE OF MANAGEMENT The field of management is very wide. The operational areas of business management may be classified into the following categories: (i) Production Management: Production management implies planning, organising, directing and controlling the production function so as to produce the right

goods, in right quantity, at the right time and at the right cost. It includes the following activities: designing the product location and layout of plant and building planning and control of factory operations operation of purchase and storage of materials repairs and maintenance inventory cost and quality control research and development. (ii) Marketing Management: Marketing management refers to the identification of consumers needs and supplying them the goods and services which can satisfy these wants. It involves the following activities: marketing research to determine the needs and expectation of consumers planning and developing suitable products setting appropriate prices selecting the right channel of distribution promotional activities like advertising and salesmanship to communicate with the customers. (iii) Financial Management: Financial management seeks to ensure the right amount and type of funds to business at the right time and at reasonable cost. It comprises the following activities:

estimating the volume of funds required for both long-term and short-term needs of business selecting the appropriate source of funds raising the required funds at the right time ensuring proper utilisation and allocation of raised funds so as to maintain safety and liquidity of funds administration of earnings Thus, financial management involves the planning, organizing and controlling of the financial resources. (iv) Personnel Management: Personnel management involves planning, organising and controlling the procurement, development, compensation, maintenance and integration of human resources of an organisation. It consists of the following activities: manpower planning recruitments, selection, training promotions and transfers, compensation, employee welfare services IMPORTANCE OF MANAGEMENT Management is indispensable for the successful functioning of

every organisation. It is all the more important in business enterprises. No business runs in itself, even on momentum. Every business needs repeated stimulus which can only be provided by management. (i) Achievement of group goals: A human group consists of several persons, each specialising in doing a part of the total task. Each person may be working efficiently, but the group as a whole cannot realise its objectives unless there is mutual cooperation and coordination among the members of the group. Management creates team-work and coordination in the group. He reconciles the objectives of the group with those of its members so that each one of them is motivated to make his best contribution towards the accomplishment of group goals. Managers provide inspiring leadership to keep the members of the group working hard. (ii) Optimum utilisation of resources: Managers forecast the need for materials, machinery, money and manpower. They ensure that the organization has adequate resources and at the same time does not have idle resources. They create and maintain an environment conducive to highest productivity. Managers make sure that workers know their jobs well and use the most efficient methods of work. They provide training and guidance to employers so that they can make the best use of the available resources.

(iii) Minimisation of cost: In the modern era of cutthroat competition no business can succeed unless it is able to supply the required goods and services at the lowest possible cost per unit. Management directs day-to-day operations in such a manner that all wastage and extravagance are avoided. By reducing costs and improving efficiency, managers enable an enterprise to be competent to face competitors and earn profits. (iv) Survival and growth: Modern business operates in a rapidly changing environment. An enterprise has to adapt itself to the changing demands of the market and society. Management keeps in touch with the existing business environment and draws its predictions about the trends in future. It takes steps in advance to meet the challenges of changing environment. Changes in business environment create risks as well as opportunities. Managers enable the enterprise to minimise the risks and maximise the benefits of opportunities. In this way, managers facilitate the continuity and prosperity of business. (v) Generation of employment: By setting up and expanding business enterprises, managers create jobs for the people. People earn their livelihood by working in these organisations. Managers also create such an environment that people working in enterprise can get job satisfaction and happiness. In this way managers

help to satisfy the economic and social needs of the employees. (vi) Development of the nation: Efficient management is equally important at the national level. Management is the most crucial factor in economic and social development. The development of a country largely depends on the quality of the management of its resources. Capital investment and import of technical knowhow cannot lead to economic growth unless wealth producing resources are managed efficiently. By producing wealth, management increases the national income and the living standards of people. That is why management is regarded as a key to the economic growth of a country. How is General Administrative Theory different from Scientific Management Theory ? Henry Fayol Father of Mangement

Fayol is known as the father of management or the founder of the classical management. Not because he was first to investigate managerial behaviour, but because he was the first to systematize it. He was contemporary to Taylor. Taylor was basically concerned with organizational functions, whereas Fayol was interested in the total organization. It may be noted that Taylor is known as the father of scientific management, i.e. supervisory or lower

management, while Fayol is recognized as the father of management, i.e. the higher management or the general management. Division of Business Activities

According to Fayol, business activities in any organization consist of six interdependent operations as follows: 1. Technical - activities concerning production. 2. Commercial - activities concerning buying, selling and exchange. 3. Financial - activities concerning optimum use of capital. 4. Security - activities concerning protection of property. 5. Accounting - activities concerning final accounts, costs and statistics. 6. Managerial activities concerning planning, organizing, commanding, coordinating and controlling. According to him, the first five activities were well known and as such to devoted his attention to the description and explanation of the managerial activities. Also he analyzed the nature of such activities and skill requirements, which were so far given little scattered attention by thinkers. Universality of Management: (Elements of Management) Fayol considered the process of management to be of universal application and distinguished between five

elements of the process. He regarded these elements of management as the function of management, which were being performed by all managers universally and at all the levels of organization. He divided management functions into five parts as follows: Forecasting and planning Organizing Command Coordination Control Thus, according to Fayol, management means to forecast and plan, to organize, to command, to coordinate and to control. The management was defined as the process of performing these functions. It may be noted that the present pattern of management functions follows broadly the lines set by Fayol. Fayol emphasized that management involved the application of certain skills, which could be acquired by persons on the basis of systematic instructions and training. Once acquired the skills could be applied to all kinds of institutions including church, schools, political as well as industrial organization. Besides a systematic analysis of the management process and management functions, Fayol formulated a set of fourteen principles as guidelines for implementing the process of management. These principles may be listed as follows: 1. Division of Work

In any organized situation, work should be divided into compact jobs to be assigned to individuals. This applies to managerial work and non-managerial work. Division of labour facilities specialization and improves efficiency, if it is done within reasonable limits. 2. Authorities and Responsibility The authority is the official right to a manager to manage people and things. Authority of a manager goes hand in hand with the responsibility for effective results. In other words, there should be parity or balance between authority and responsibility vested in a managerial position. 3. Discipline Discipline is defined as observance of diligence and respect for seniors and rules and regulations. Managers as leaders of their work groups should enforce discipline throughout the organization. Fayol declares that discipline requires good superiors at all levels. He emphasized the need of discipline among the personnel for the smooth running of organization. He advocated penalties to prevent in violation. 4. Unity of Command It means that a subordinate in an organization should be under direct supervision of a single from whom he should get instructions and to whom be should be accountable. In other words, every employee should have only one boss. If a subordinate has more than

one boss, to that case conflict and condition in authority and instructions of general bosses would result. 5. Unity of Direction Fayol advocates one head, one plan for a group of activities having same objective. In other words, a set of activities having the same objective should be under the direction of a single manager. Similarly, there should be one plan of action for such a set of activities because the objective is the same. This principle promotes smooth coordination of activities, efforts and resources. 6. Subordination of Individual Interest to Group Interest The collective good and common interest of the organization should prevail over the narrow, sectional and self-interest of its members of an organization for the welfare of both the organization and the members. 7. Remuneration of Personnel Remuneration as well the methods of payment in an organization should be fair so as to afford maximum satisfaction both to the organization and its employees. 8. Centralization According to Fayol, everything which reduces the importance of subordinates role is centralization and that which increases it, is decentralization. In his

opinion, the question of centralization and optimum degree in particular case. There should be a proper combination and decentralization in an organization based on a consideration of several internal and external factors. 9. Scalar Chain Fayol defines the scalar chain as the chain of superiors ranging from the ultimate authority (i.e. top authority) to the lowest ranks. It is also known as hierarchy of management. Every communication should follow the prescribed route, i.e. the proper channel. Authority relationships are said to be scalar when subordinates report to their immediate superiors and when their superiors, in turn, directly report as subordinates, to their superiors. 10. Order Order relates to both persons and things. It means a systematic arrangement of materials and systematic placement of people in the organization. In material order, everything should be in its proper place and there should be a place for everthing. For social order there should be a place assigned to each employee, and each employee should be in the place assigned. The right man in the right place is the ideal here. 11. Equity Equity means combination of fairness, kindliness and justice. Equity motivates the workers to perform

their duties. Besides, it promotes a friendly atmosphere between superiors and subordinates. 12. Stability of Tenure of Personnel Management should strive to minimize employee turnover (i.e. changes in staff). In other words efforts should be made to achieve relative stability and continuity of tenure of the personnel. This could be achieved by attractive remuneration and honourable treatment of personnel. Stability and continuity of personnel promote teamwork, loyalty and economy. 13. Initiative It refers to the freedom to propose a plan and execute it. Management should encourage subordinates to take desirable initiative in thinking out plans and executing them. Entending opportunities and freedom to contribute their best could do this. 14. Esprit de corps Esprit de corps means the spirit of loyalty and devotion, which unites the members of a group or society. It is a sense of respect and belongingness to one's organisation. This principle stresses the need for team spirit, cordial relations, and co-operations among the personnel. It is to be noted that Fayol made is clear that he had no intention to close the list of principles or make them inflexible. Limitations or Weaknesses

Fayol's administrative theory of management is criticized on the following grounds: 1. It is too formal as Fayol divides "business activities" into six categories, and their management into five functions and the implementation of these functions with the help of fourteen principles. 2. Some critics call this theory as inconsistent, vague and inadequate. 3. It does not pay adequate attention to workers. It has pro-management bias. 4. Jernert Simon calls Fayol's principles as proverbs, comparable to folklore and folk wisdom. The criticism of Fayols theory is not fully justified. Firstly, fayols theory is too formal, is a baseless charge. Because, every scientific and analytical study is bound to be formal. A regards the second point of workers remuneration, Fayol did discus about the fairness of remuneration and non financial incentives. But he did not work out a rational system of wage fixation. Thus, this point of criticism is partially valid. To sum up, it can be said that the points of criticism are very minor in comparison to the contribution of Fayol in the field of management. He is regarded as the Father of Administrative Management Theory. Albert Lepawsky __ The twentieth century has yet to produce as balance a combination of able practitioner and keen student of administration as Henry Fayol

Frederick Taylors Theory of Scientific Management Taylor published the book The Principles of Scientific Management in which he explained his techniques that were adopted to improve the productivity of employees at Bethlehem Steel. His techniques proved to be a great success and as a result Taylor became recognized as the founder of the Work Study movement. According to Taylor, the majority of workers put minimal effort into their work if they knew they could easily get away with it. He referred to this mode of behavior as soldiering and he attributed this problem with mismanagement of the work at the lowest levels of the organization. This lack of proper organization manifested itself in a lack of productivity. At the time it was common practice in industrial organizations that managers adjusted the payments for the employees jobs based on levels of production reached. This meant that an increase in production brought down the pay rates vis--vis production levels. Consequently, it was the workers themselves who determined their productivity levels and this gave the workers the opportunity to keep production levels at a minimum level.

Frederick Taylors Scientific Method Taylor adopted a different approach by introducing a step-by-step method to determine best practices or the one best way in performing a job and thereby establishing the proper pay-rates for the job. Taylors scientific method was of great influence to industrial companies and it completely revolutionized the organization of work in industrial organizations. Taylors methodical approach to determine the one best way to perform a job consisted of the following steps: Select a sample of skilled workers and carefully study the job being done. Carefully list each operation including extensive detail on each task being performed. Utilize a stopwatch to time each task being performed. Repeat this step over a period of time to obtain an average of the time it takes to perform each task. Identify and eliminate any unnecessary tasks that are performed to finalize the job. Identify any improvements, tools or techniques that can be adopted to reduce the time in performing the job. Establish new and informed times and pay-rates for the job. Lastly, all workers are trained to perform the job in the one best way identified. Taylors scientific method to establish work procedures resulted in reduced timeframes to

perform jobs and introduced rules and procedures to industrial management. Taylor's Four Principles of Scientific Management are as follows: Replace working by "rule of thumb," or simple habit and common sense, and instead use the scientific method to study work and determine the most efficient way to perform specific tasks. Rather than simply assign workers to just any job, match workers to their jobs based on capability and motivation, and train them to work at maximum efficiency. Monitor worker performance, and provide instructions and supervision to ensure that they're using the most efficient ways of working. Allocate the work between managers and workers so that the managers spend their time planning and training, allowing the workers to perform their tasks efficiently.

Critiques of Taylorism Taylorism promotes the idea that there is "one right way" to do something. As such, it is at odds with current approaches such as MBO (Management By Objectives),Continuous Improvement initiatives, BPR (Business Process Engineering), and other tools like them. These promote individual responsibility, and seek to push decision making through all levels of the organization.

The idea here is that workers are given as much autonomy as practically possible, so that they can use the most appropriate approaches for the situation at hand. What's more, front line workers need to show this sort of flexibility in a rapidly-changing environment. Rigid, rules-driven organizations really struggle to adapt in these situations. Teamwork is another area where pure Taylorism is in opposition to current practice. Essentially, Taylorism breaks tasks down into tiny steps, and focuses on how each person can do his or her specific series of steps best. Modern methodologies prefer to examine work systems more holistically in order to evaluate efficiency and maximize productivity. The extreme specialization that Taylorism promotes is contrary to modern ideals of how to provide a motivating and satisfying workplace. Where Taylorism separates manual from mental work, modern productivity enhancement practices seek to incorporate worker's ideas, experience and knowledge into best practice. Scientific management in its pure form focuses too much on the mechanics, and fails to value the people side of work, whereby motivation and workplace satisfaction are key elements in an efficient and productive organization.

DIFFERENCE IN BOTH THEORIES Basis Human aspect Taylor Taylor disregards human elements and there is more stress on improving men, materials and methods Father of scientific management Stressed on efficiency It has microapproach because it is Fayol Fayol pays due regards on human element. E.g. Principle of initiative, Espirit De Corps and Equity recognizes a need for human relations Father of management principles Stressed on general administration It has macroapproach and discuses general

Status

Efficiency & administration Approach

restricted to factory only

principles of management which are applicable in every field of management. These are applicable in all kinds of organization regarding their management affairs Administrative management

Scope principles

of

These principles are restricted to production activities Scientific management

Achievement