MODULE 1

1. DEFINITION OF MANAGEMENT
1. Management is a vast and extensive subject. It is therefore, not possible to put all the essential features of
management in a single formula.
2. Management is concerned with human beings, who are highly unpredictable in terms of behavior.
3. Management is a young developing discipline whose concepts are dynamic.

2. NATURE OF MANAGEMENT
1. Management is Goal-Oriented: Management focuses on achieving specific objectives. It involves planning and
organizing resources to meet pre-determined goals. For instance, a business aims to maximize customer satisfaction
by producing quality products at competitive prices. This requires skilled personnel and efficient use of resources.
2. Management Integrates Resources: Organizations rely on human, physical, and financial resources to operate.
Management ensures that these resources are utilized effectively and aligned with organizational goals. It involves
balancing people, machinery, and finances to optimize performance.
3. Management is Continuous: Management is an ongoing process. It involves identifying and solving problems,
adapting to changes, and continuously improving operations. As organizations grow, management must adjust
strategies and processes to meet evolving challenges.
4. Management is All-Pervasive: Management is essential in all types of organizations, whether it is a business, political
party, hospital, or educational institution. Any group that requires coordination and collaboration needs
management, regardless of size or industry.
5. Management is a Group Activity: Management involves teamwork and coordination. It’s not about individual effort
but about organizing and motivating people to work together toward common goals. Effective management relies on
fostering cooperation and maintaining strong team dynamics.
6. Principles are Dynamic: Management principles evolve with changing environments and new insights. They are
flexible and should adapt to the unique needs of each organization. As industries and societies change, management
principles are refined and updated.
7. Principles are Relative: Management principles must be applied according to the specific context, considering factors
like culture, time, and place. What works in one organization or situation may not work in another, so flexibility is
crucial.
8. Management is a Science, Art, and Profession: Management combines systematic principles (science), practical skills
(art), and specialized knowledge (profession). It requires both technical expertise and creativity.
9. Management is Decision-Making: At its core, management involves making decisions. Effective decision-making is
crucial for organizational success, as the future of the organization depends on the choices managers make.
3. FUNCTIONS OF MANAGEMENT
1. Planning: Planning is the first and essential step in management, focused on determining the best course of action
to achieve organizational goals. According to Koontz, it involves preparing for future actions and providing direction
for decision-making. Planning ensures efficient use of human and non-human resources to meet objectives.
2. Organizing: Organizing involves arranging resources—physical, financial, and human—and developing
relationships within the organization to achieve its goals. Henry Fayol described it as arranging everything needed for
the business to function. Organizing includes:
• Identifying activities
• Grouping activities into departments
• Defining responsibilities
• Delegating authority and responsibility
• Coordinating functions
3. Staffing: Staffing is about assigning the right people to the right roles to support the organization's operations. As
businesses grow, staffing becomes crucial in managing human resources effectively. Koontz and O'Donnell
emphasized staffing's role in recruitment, training, and development. Key staffing activities include:
• Recruitment and selection
• Placement and training
• Compensation
• Appraisals and promotions
4. Directing: Directing focuses on motivating, guiding, and supervising employees to achieve organizational goals. It
is an interpersonal aspect of management that involves ensuring efficient work through leadership and
communication. The elements of directing include:
• Supervision: Overseeing employees' work.
• Motivation: Inspiring employees to perform well.
• Leadership: Guiding employees to work in the right direction.
• Communication: Ensuring clear information flow within the organization.
5. Controlling: Controlling involves measuring actual performance against set standards and making adjustments to
ensure goals are met. Theo Haimann defined it as assessing progress and correcting deviations. Koontz and O'Donnell
view controlling as ensuring subordinates’ activities align with plans. The steps include:
• Setting performance standards
• Measuring actual performance
• Comparing performance with standards
• Correcting deviations

4. IMPORTANCE OF MANAGEMENT
1. Effective Utilization of Resources: Management aims to maximize the use of scarce resources for the benefit of
society. It not only decides which resources should be used in specific alternatives but also ensures they are utilized
in the best possible way to meet societal demands.
2. Development of Resources: Management is involved in developing both human and non-human resources. As
Lawrence Appley stated, management is about developing people. Organized research and activities aimed at
resource development improve the quality of life for individuals in society, benefiting both individuals and
organizations.
3. Incorporating Innovations: With rapid changes in technology and social structures, businesses need to adapt to
remain competitive. As organizations evolve, they require specialized skills, higher competence, and complex
technologies. Effective management ensures that organizations can incorporate these innovations, allowing them to
function efficiently in a constantly changing environment.
4. Integrating Various Interest Groups: Organizations often face pressure from different interest groups, such as
shareholders, employees, and the government. Management must balance these competing interests to ensure
harmony within the organization. In a complex society, managing these pressures effectively becomes crucial for
organizational success.
5. Stability in Society: Management helps maintain stability by adapting resources to meet societal changes. In the
modern age, innovation leads to the obsolescence of old systems. Management plays a key role in integrating
traditional practices with new inventions, safeguarding society from the negative impacts of rapid change, and
ensuring continuity in social processes.
5. LEVELS OF MANAGEMENT
Levels of Management
In an organization, there are certain levels defined by the management wherein each level is confined with its nature
and activities involved. The levels of management can be classified in three broad categories:
• Top level / Administrative level
• Middle level / Executor level
• Low level / Supervisory / Operative / First-line managers
It is seen that different levels have different work areas and functions. The role of managers at all three levels is
discussed below:
Top Management
• Determines objectives and policies.
• Designs the basic operating and financial structure of an organization.
• Provides guidance and direction.
• Lays down standards of performance.
• Maintains good public relations.
Middle Management
• Interprets and explains the policies framed by the top.
• Issues detailed instructions.
• Participates in operating decisions.
• Trains other managers.
Lower Management
• Plans day-to-day operations.
• Assigns jobs to workers.
• Provides supervision and control over work.
• Arranges material tools and equipment.
• Maintains discipline.

6. ROLES OF A MANAGER
1. Interpersonal Role
o Figurehead: The manager performs ceremonial duties, such as welcoming dignitaries, attending business
functions, and engaging with employees to build rapport.
o Leader: A manager motivates and encourages employees, aligning their personal needs with organizational goals.
A manager should earn both trust and respect from their team.
o Liaison: The manager builds external contacts and gathers information to benefit the organization.
2. Informational Role
o Monitor: The manager scans the environment for information, debriefs contacts, and evaluates unsolicited
information from various sources.
o Disseminator: The manager shares important information with subordinates that they would not otherwise have
access to.
o Spokesman: The manager communicates with external groups to ensure the organization meets obligations, such
as informing shareholders, consumer groups, and government authorities about performance and compliance.
3. Decision Role
o Entrepreneur: The manager seeks opportunities to adapt and improve the organization in response to changes in
the environment.
o Disturbance Handler: The manager addresses unexpected issues, such as strikes or crises, to maintain operations.
o Resource Allocator: The manager delegates authority and assigns tasks, ensuring resources are distributed
effectively.
o Negotiator: The manager negotiates on behalf of the organization, dealing with issues like worker welfare, union
agreements, or grievances.
7. MANAGERIAL SKILLS
The American Management Association has identified key skills for managers that cover various aspects, such as
technical, communication, interpersonal, and conceptual skills:
1. Technical Skills: Knowledge and proficiency in a specific field, such as engineering, finance, or manufacturing, are
essential for managers.
2. Human Skills: The ability to work well with individuals or groups, since managers interact directly with people,
fostering positive relationships.
3. Conceptual Skills: These involve problem-solving and critical thinking, allowing managers to identify opportunities,
solve problems, and analyze complex data to make informed decisions.
4. Communication Skills: The ability to express thoughts clearly, both verbally and in writing, is key to improving
relationships with colleagues, subordinates, and other stakeholders.
5. Effectiveness Skills: Focus on contributing to the organization’s goals, such as customer relations, project
management, and maintaining performance standards.
6. Interpersonal Skills: The ability to regulate and mentor employees, fostering commitment and cooperation in diverse
teams, is crucial in today’s dynamic workplace.
7. Design Skills: Koontz and Weibrich introduced design skills, emphasizing the ability to create solutions to problems.
At higher levels, managers must not just identify problems but design practical solutions in light of real-world
constraints.

8. MANAGEMENT AS SCIENCE, ART & PROFESSION

1. Management as an Art: Managing is an art because it involves the practical knowledge of "how" to get things
done. It requires understanding the realities of a situation and applying skills in dynamic, non-repetitive
environments. Management involves getting tasks done through others and adapting to changing circumstances
to achieve organizational goals. It is a skill that evolves through experience and judgment.
2. Management as a Science: Management can also be considered a science. Science is organized knowledge, and
management employs systematic methods to accumulate, analyze, and apply data. It uses scientific techniques
to solve problems, with a structured approach that builds upon previous knowledge. By applying research,
observation, and analysis, management continuously evolves, helping organizations improve and adapt to
changes.
3. Management as a Profession: While management has some characteristics of a profession, it does not fully meet
the criteria. A profession typically involves systematic knowledge, formal training, an ethical code, and licensing.
Unlike fields like medicine or law, there is no universal standard for managerial behavior or qualifications.
However, management has become more professionalized over time. With the rise of MBA programs and
specialized business schools, management is increasingly seen as a profession, though it is still not as formalized
as other established professions. Despite this, successful managers, such as Bill Gates and Dhirubhai Ambani,
demonstrate that skill and experience are key factors in effective management, regardless of formal
qualifications.
9. MANAGEMENT & ADMINISTRATION
Theo Haimann defines administration as the overall determination of policies, setting major objectives, and
identifying general purposes. It refers to activities at higher levels of the organization, focusing on broad principles
and programs. According to Newman, administration involves guidance, leadership, and control of group efforts
towards common goals.
Management, on the other hand, involves the practical aspects of achieving these goals. It includes conceiving,
initiating, and coordinating various elements within an organization to sustain its viability and progress toward
predetermined objectives. In simple terms, management is the art of getting things done through others in formally
organized groups.
The distinction between management and administration can be categorized into two areas:
• Functions: Administration deals with setting broad policies and frameworks, while management focuses on
executing and overseeing daily operations.
• Usage/Applicability: Higher-level managers are more involved in administrative functions, while lower-level
managers focus on directing and controlling performance.
In practice, there is no sharp distinction, as every manager handles both administrative and operational functions.
However, the level of involvement in each varies depending on the manager’s position in the hierarchy.
 MODULE II B
1. PLANNING
Based on futurity:
• Planning is a trap laid down to capture the future. (Allen)
• Planning is deciding in advance what is to be done in the future. (Koontz)
• Planning is informed anticipation of the future. (Haimann)
• Planning is ‘anticipatory’ decision-making. (R.L, Ackoff)
Based on thinking:
• Planning is a thinking process, an organized foresight, a vision based on fact and experience required for
intelligent action. (Alford and Beatt)
• Planning is deciding in advance what to do, how to do it, when to do it, and who is to do it. (Koontz and
O’Donnell)
A plan is a specific, documented intention consisting of an objective and an action statement. The objective portion
is the end, and the action statements represent the means to that end. Objectives give management targets to shoot
at, while action statements provide the arrows for hitting those targets. Properly conceived plans give a fair idea of
how things are to work out.

2. NATURE OF PLANNING
Planning is the most basic function of management. It involves deciding in advance what to do, how to do it, when
to do it, and who will do it. It is an intellectual process that requires a manager to think before acting, or thinking in
advance. According to Koontz and O'Donnell, planning is a continuous process. A manager must always monitor the
progress of plans, much like a navigator constantly checks their course.
Planning involves selecting objectives and determining how to achieve them, bridging the gap between where we
are and where we want to be. While plans must remain consistent, they should also be flexible enough to adapt to
changing situations without incurring excessive costs, especially in areas like technology, markets, finance, and
personnel.
Planning is essential at all levels of an organization. Top-level managers focus on long-term planning (2–5 years),
middle-level managers handle medium-term planning (months to a year), and lower-level managers focus on short-
term planning (daily, weekly, or monthly). Workers also plan their daily tasks.
The nature of planning includes four essential qualities:
1. It must help achieve organizational objectives.
2. It should be integral to all management processes.
3. It must involve all functions of management.
4. It must be efficient, achieving goals at minimal cost.
Planning is dynamic, not static, and serves as a blueprint for achieving goals.

3. IMPORTANCE OF PLANNING
1. Planning facilitates management by objectives
• Planning starts with defining an objective.
• It clarifies the purpose of activities.
• It helps employees stay focused on goals.
• Without planning, there is no clear direction.
2. Planning minimizes uncertainties
• Business involves various uncertainties.
• These uncertainties introduce risks.
• Planning reduces these risks by anticipating future events.
• Although the future cannot be predicted, planning helps the management foresee activities.
3. Planning facilitates coordination
• Planning aligns activities with organizational goals.
• It ensures all efforts are directed towards common objectives.
• It avoids duplication of efforts and improves coordination between departments.
• It addresses work performance issues and ensures efficiency.
4. Planning improves employee morale
• Planning creates an atmosphere of order and discipline.
• Employees understand their roles, leading to better conformity and focus.
5. Planning helps achieve economy
• Effective planning ensures resources are allocated efficiently.
• It prevents waste and promotes optimal use of resources.
6. Planning facilitates controlling
• Planning sets goals and performance standards.
• It provides the foundation for controlling operations.
• Without good planning, controlling is unmanageable.
7. Planning encourages innovations
• Through planning, managers suggest ways to improve performance.
• It promotes creativity and innovative methods to reach goals.
8. Planning provides a competitive edge
• Planning involves changes in work methods, quality, and designs.
• It helps forecast competitors' actions and secure the enterprise’s future.
• It encourages creative thinking to drive growth and improvements.

4. TYPES OF PLANS
The network of various plans guides managers in decision-making and actions. Understanding single-use and standing
plans, as well as distinguishing between policies, strategies, procedures, and objectives, is essential for effective
planning. These plans help managers manage daily operations, utilize organizational resources efficiently, and
regulate employee behavior.
1. Single-Use Plans
• Objective: Specifies the desired future outcome or goal.
• Strategy: A course of action that aligns organizational strengths and weaknesses with external opportunities
and threats.
• Programme: A coordinated set of policies, procedures, rules, and budgets designed to implement a specific
course of action.
• Budget: A financial plan that estimates expected revenue and expenditure over a specific period.
2. Standing Plans
• Policies: General guidelines that shape decision-making.
• Procedure: A step-by-step sequence of actions to carry out specific tasks.
• Method: The specific approach for performing an activity.
• Rules: Clear directives that regulate and control employee behavior.
These plans ensure consistency, efficiency, and alignment with organizational goals, providing a framework for
effective management.

5. TYPES OF PLANNING
1. Operational Planning
Operational planning is a short-term plan focusing on daily maintenance activities completed at a departmental
level to support overall strategic planning. Steps involved in operational planning include:
• Setting goals and objectives
• Establishing priorities
• Making assumptions
• Reviewing and adjusting plans
• Creating primary and backup plans
• Implementing the plans
• Establishing a control system and following up on progress
2. Intermediate Planning
Intermediate planning involves a time frame of one to five years. It is usually handled by top managers in
coordination with middle managers to align organizational goals. This type of planning focuses on achieving
medium-term objectives.
3. Contingency Planning
Contingency planning addresses unforeseen emergencies or crises. Its goal is to ensure proper follow-up steps
during emergencies. Key objectives include:
• Containing damage or loss of personnel and property
• Ensuring continuity of key operations
 4. Strategic Planning
Strategic planning focuses on long-term goals and involves critical steps, such as:
• Maintaining business operations
• Defining time frames
• Identifying triggers for action
• Keeping the plan simple
• Considering resource limitations
• Addressing everyone’s needs
• Defining success criteria
• Integrating contingency plans into standard procedures
• Managing risks
• Identifying operational inefficiencies
Strategic planning helps develop a positive work environment, boosting employee morale and efficiency, and
achieving pre-determined organizational goals by comparing actual performance with targets.

6. STEPS OF PLANNING
1. Being Aware of Opportunities: The first step is recognizing potential opportunities. Awareness of opportunities
helps in setting realistic objectives.
2. Establishing Objectives: Setting clear and achievable objectives for the entire enterprise and for individual units
is crucial. Major objectives are broken down into departmental and personal goals, ensuring clarity in the planning
process.
3. Developing Planning Premises: This step involves creating assumptions about future conditions, which form the
foundation for the plan. Planning premises can be internal (e.g., company policies, resource availability) or external
(e.g., government policies, market conditions). They can also be tangible (measurable) or intangible (qualitative), and
either controllable (e.g., workforce skills, technology) or uncontrollable (e.g., political instability, economic shifts).
4. Determination of Alternative Courses: Once the objectives are clear, it’s important to identify alternative courses
of action. Rarely does a single path exist for achieving a goal, so this step ensures flexibility in planning.
5. Evaluating Alternatives and Selecting the Best Course: After identifying alternatives, they are evaluated based on
factors such as cost, risk, and alignment with goals. The best alternative is selected based on this analysis.
6. Formulating Derivative Plans: The chosen plan is then translated into specific programs, working plans, and
financial requirements. These are the derivative plans that support the main plan and ensure its execution at lower
levels.
7. Monitoring and Controlling the Plan: The final step involves continuous monitoring of the plan’s implementation.
If any deviation or shortfall is detected, corrective actions are taken to bring the plan back on track.

7. ADVANTAGES & DISADVANTAGES OF PLANNING

Advantages
• Planning creates a blueprint for achieving objectives.
• It brings order and rationality to an organization.
• Encourages employees to perform well, leading to rewards.
• Facilitates optimal resource utilization and enhances productivity.
• Supports organizational control and performance evaluation.
Disadvantages
• Planning can lead to rigidity in administration.
• Requires extensive policies and procedures, limiting flexibility.
• Restricts individual freedom and focuses on organizational goals.
• Collecting and analysing data is time-consuming.
• Ineffective during emergencies or crises when quick decisions are necessary.
• Relies on assumptions about the future, which may be uncertain.
• Planning can be costly due to time and resources spent on information gathering and evaluation.
8. MEANING OF DECISION MAKING
Decision-making is the cognitive process of selecting a course of action from several alternatives. It involves
identifying and evaluating options based on the decision-maker’s values and goals. The process typically results in a
final choice, often shaped by two key factors: the likelihood of success and the alignment of the decision with personal
values, goals, and desires. The decision-making process also involves gathering information to reduce uncertainty,
though it rarely eliminates doubt entirely.

9. DECISION MAKING CHARACTERISTICS

1. Goal-Oriented: Decision-making is a goal-driven process. Each decision is intended to help achieve a specific goal
or purpose, moving towards an anticipated state.
2. Alternative-Based: A decision is made after identifying alternatives. Managers search for opportunities and
evaluate alternatives to address a problem. When no alternatives exist, no decision is required. Decisions are made
only when faced with uncertainty and available alternatives.
3. Analytical and Intellectual: Decision-making involves both intellectual and intuitive processes. It requires logical
reasoning and analysis, but also relies on intuition and the decision maker's personal qualities. Some aspects can be
learned, while others are shaped by experience and individual characteristics.
4. Dynamic Process: Decision-making is a continuous and evolving process. It involves using inputs effectively to solve
problems and create valuable outputs. The process adapts to a dynamic environment and requires ongoing
assessment.
5. Pervasive Function: Decision-making is central to all management activities and affects every part of an
organization. It is fundamental to a manager's role and informs every action taken.
6. Continuous Activity: Decision-making is an ongoing activity. Managers continuously make decisions, varying in
importance, as the situation demands. It is not a one-time event but a continuous responsibility.
7. Commitment of Time, Effort, and Money: Every decision involves a commitment of resources, including time,
effort, and finances. The scale of this commitment depends on the type of decision (e.g., strategic, tactical, or
operational).
8. Human and Social Process: Decision-making is also a human and social process. It involves considering the impact
on people and the organization. Managers must consider the human and social consequences of their decisions, such
as labor issues or changes in workforce structure.
9. Integral Part of Planning: As Koontz pointed out, decision-making is essential to planning. Both are interrelated and
involve choosing the best course of action to achieve desired goals, based on forecasts and assumptions about future
risks and opportunities.

10. STEPS IN DECISION MAKING

1. Recognition of the Problem:
The first step is recognizing that a problem exists, which may arise due to a deviation from past experiences, a plan,
issues raised by employees, or competition.
2. Prioritizing Problems:
The manager must prioritize problems to determine which they can solve, which can be solved by subordinates, and
which need to be referred to higher management. This helps focus on the most important problems.
3. Problem Diagnosis:
Correct diagnosis of the problem is vital. The manager should use a systems approach to analyze the issue thoroughly
before deciding on a solution.
4. Development of Alternative Solutions:
Once the problem is diagnosed, the manager should generate alternative solutions. It's rare for a problem to have
just one solution, so alternatives should always be considered.
5. Evaluating Alternatives:
The manager must compare the alternatives in terms of quality, feasibility, and acceptability. This evaluation helps
identify the best solution.
6. Implementation of the Decision:
After selecting the best solution, the manager implements the decision by clearly communicating it to employees
and addressing any resistance.
7. Study of Results:
After implementation, the manager must monitor the results. If outcomes are unsatisfactory, corrective action or
adjustments to the decision may be necessary.
11. GUIDELINES FOR MAKING EFFECTIVE DECISION
1. Categorical Interpretation: At the very outset, it may be emphasized that logical decisions can be made if the real
problem is interpreted and identified with in-depth study and observation.
2. Application of Limiting Factor: In choosing from among alternatives, the more a manager recognizes and solves for
those factors, which are limiting and critical to the attainment of desired objectives, the more clearly and accurately
he can select the most desirable alternative.
3. Adequate Information: Information is the lifeblood of an organization because all conclusions are based on this.
The more the quantity of reliable information, the higher the validity of the decision.
4. Considering Others’ Views: While arriving at a decision, it is desirable that all alternatives are considered before
arriving at a decision.
5. Timeliness: A decision, to be effective, must be made at the proper time. A delay in decision-making may result in
the loss of opportunities in this fast-changing environment.

12. TYPES OF DECISION MAKING

1. Strategic decisions: These are big choices of identity and direction. Who are we? Where are we heading? These
decisions are often complex and multidimensional. They may involve large sums of money, have a long-term impact,
and are usually taken by senior management.
2. Tactical decisions: These decisions are about how to manage performance to achieve the strategy. What resources
are needed? What is the timescale? These decisions are idiosyncratic but within clearer boundaries. They may involve
important resources, have medium-term implications, and may be taken by senior or middle managers.
3. Operational decisions: These are more routine and follow known rules. How many? To what specification? These
decisions involve more limited resources, have a shorter-term application, and can be taken by middle or first-line
managers.

TYPES OF DECISION MAKING