Principles of Management - Unit 1

MG6851- PRINCIPLES
OF MANAGEMENT
Unit- 1
INTRODUCTION TO MANAGEMENT
AND ORGANIZATIONS
CONTENT
 Definition of management
 Science or art
 Manager vs entrepreneur
 Types of managers
 Managerial roles and skills
 Evolution of management
 Scientific, human relations , system and contingency approaches
 Types of business organization
 Sole proprietorship, partnership, company
 Public and private sector enterprises
 Organization culture and environment
 Current trends and issues in management.
Lecture ppt by Ms.M.A.Madhumathi., AP/EEE 2
MANAGEMENT
• Management is a universal phenomenon.
• Every individual or entity requires setting objectives, making
plans, handling people, coordinating and controlling activities,
achieving goals and evaluating performance directed towards
organizational goals.
• These activities relate to the utilization of variables or resources
from the environment − human, monetary, physical, and
informational.
09/10/2020 Lecture ppt by Ms.M.A.Madhumathi., AP/EEE 3

Management Defined
AUTHOR DEFINITION
HAROLD KOONTZ Process of designing and maintaining an environment in which
individuals working together in groups, effectively accomplish
selected aims.
F. W. TAYLOR Art of knowing what you want to do and seeing that it is done
in the best and cheapest way.
S. GEORGE It consists of getting things done through others. Managers is
the one who accomplishes the objectives by directing the
efforts of others.
Mc FARLAND Conceptual, theoretical and analytical purposes: managers
create, direct, maintain and operate purposive organization
through systematic, co-ordinated co-operative human effort.
09/10/2020
Management Defined
AUTHOR DEFINITION
GEORGE. R. TERRY Distinct process consisting of planning, organizing, actuating

and controlling performed to determine and accomplish the
objectives by the use of people and resources.
HENRY FAYOL To manage is to forecast and to plan, to organize , to command,

to co-ordinate and to control.
NEWMAN, SUMMER, The job of management is to make co-operative endeavour to

WARREN function properly. A manager is one who gets things done by
working with people and other resources.
09/10/2020
Management - Formally defined
The principles of management are the activities that

“plan, organize, and control the operations of the basic
elements of [people], materials, machines, methods,
money and markets, providing direction and
coordination, and giving leadership to human efforts, so
as to achieve the sought objectives of the enterprise.”

Characteristics
1. Multidisciplinary 1. To obtain wealthy results
2. Continuous process 2. Implies skill and
3. Universal activity experience in getting
4. Science as well as an art things done through
people
5. Dynamic
3. Intangible
6. Profession
4. Implies good leadership
7. Group activity

Why
Why Study
Study Organizational
Organizational behaviour
behaviour (OB)
(OB) && Management?
Management?
• The better you can work with people, the more

successful you will be in both your personal and
your professional lives.
– Employers want to hire employees
who can participate in managing
the firm.
– Even nonmanagers (Individual
Contributors) are being trained
to perform management
functions.
Lecture ppt by Ms.M.A.Madhumathi., AP/EEE 1–9
Why
Why Study
Study OB
OB &
& Management?
Management? (cont’d)
(cont’d)
• The study of management builds the skills needed in today’s workplace to
succeed in:
– Becoming a partner in managing your organization through participative
management.
– Working in a team and sharing in decision making and other management tasks.
• The study of management also applies directly to your personal life in helping
you to:
– Communicate with and interact with people every day.
– Make personal plans and decisions, set goals, prioritize what you will do, and get
others to do things for you.
• Society Needs Leaders and Team Players
– Be Successful in our Community, Religious, Social, Professional, Recreational
and Other Organizations.
– Become Leaders for a “Just and Humane World”

What
What Is
Is aa Manager’s
Manager’s Responsibility?
Responsibility?
• Manager
– The individual responsible for achieving organizational objectives
through efficient and effective utilization of resources.
Participative?
• The Manager’s Resources
– Human, financial, physical, and informational
• Performance
– Means of evaluating how effectively and efficiently managers use
resources to achieve objectives.
– Today often means “How” as well as “What”

What
What Does
Does ItIt Take
Take to
to Be
Be aa Successful
Successful Manager?
Manager?
• Management Qualities (Survey of Execs.)

– Integrity, industriousness, and the ability to
get along with people
• Management Skills
– Technical
– Human and communication (Teaming)
– Conceptual and decision-making skills
• “Systems Thinking” & “Critical Thinking”
• The Ghiselli Study(6 Traits of Manager
Success – Inverse Order)
6) Initiative, 5)self-assurance,4) decisiveness, 3)
intelligence, 2) need for occupational
achievement, and 1) supervisory ability
What
What Do
Do Managers
Managers Do?
Do?
• Management Functions (Different Scope at job level)
– Planning
• Setting objectives and determining in advance exactly (?)
how the objectives will be met.
• Monitor for Change and Anticipate or React
• PDCA – Plan – Do – Check - Act
– Organizing
• Delegating and coordinating tasks and allocating
resources to achieve objectives.
– Leading
• Influencing employees to work
toward achieving objectives.
• Setting an Example (Shadow of the Leader)
– Controlling
• Establishing and implementing mechanisms to ensure that
objectives are achieved.
The
The Systems
Systems Relationship
Relationship among
among the
the Management
Management Functions
Functions
Planning
Management Functions
Controlling Organizing
Management
Skills
Leading
FUNCTIONS
FUNCTIONS OF
OF MANAGERS
MANAGERS
MAIN FUNCTION SUB-ORDINATE FUNCTION
PLANNING CO-ORDINATING
ORGANISING MOTIVATING
STAFFING COMMUNICATING
DIRECTING DECISION MAKING
CONTROLLING INNOVATIONS

Management
Management Roles
Roles
• Role
– A set of expectations of how one will behave in a given situation.
• Management Role Categories (Mintzberg)
– Interpersonal
• Figurehead, leader, and liaison
– Informational
• Monitor, disseminator, and spokesperson
– Decisional
• Entrepreneur, disturbance handler, resource allocator, and negotiator

Ten
Ten Roles
Roles Managers
Managers Play
Play
Managers play various roles as necessary while performing their management functions so as to achieve
organizational objectives.
Differences
Differences Among
Among Managers
Managers
• The Three Levels of Management
– Top managers
• CEO, president, or vice president
– Middle managers
• Sales manager, branch manager, or department head
– First-line managers
• Crew leader, supervisor, head nurse, or office manager
– Individual Contributors (ICs)
• Non-management operative employees
– Workers in the organization who are supervised by first-line managers.
• Professionals/Specialists/Technicians (Knowledge Workers)

Management
Management Levels
Levels and
and Functional
Functional Areas
Areas
SOME
ORGANIZATIONS
“FLIP” THIS CHART
UPSIDE DOWN
INDIVIDUAL CONTRIBUTORS OFTEN REPORT ANYWHERE

Types
Types of
of Managers
Managers
• General Managers
– Supervise the activities of several departments.
• Functional Managers
– Supervise the activities of related tasks.
– Common functional areas:
• Marketing/Sales/Product Development
• Operations/Production/Services Delivery
• Finance/Accounting
• Human Resources/personnel management
• Infrastructure (IT, Real Estate, Legal)
• Project Managers
– Coordinate employees across several functional departments to accomplish a
specific task.

Management
Management Skills
Skills and
and Functions
Functions
• Differences among management levels in skill needed and the
functions performed:
Planning
Controlling Organizing
Leading
Individual
Individual Management
Management Styles
Styles
Skill
Skill Builder
Builder 22
• What is Your Preferred Management Style?
• 12 Points Possible…
– Autocratic
– Consultative
– Participative
– Empowerment
– Combinations or Flexible
• Best Management Style?
– Adaptive or Situational Leadership

Differences
Differences between
between Large
Large and
and Small
Small Businesses
Businesses

Differences
Differences between
between Large
Large and
and Small
Small Businesses
Businesses (cont’d)
(cont’d)
ALSO OFTEN APPLIES TO NON-PROFITS AND CIVIC

ORGANIZATIONS, WITH FOCUS ON THEIR MISSION
The Evolution of Management Thought
Early Management Classical Perspective

Thought
Contemporary
Management Perspectives Behavioral Perspective
Early Management Thought
 Early ideas about management strategy
 Sun Tzu, The Art of War
 Early ideas about leadership

 Nicolò Machiavelli, The Prince
 Early ideas about the design and organization of work

 Adam Smith, The Wealth of Nations
 division of labor
The Operational Perspective
 Scientific Management
 Frederick W. Taylor
 Quantitative Management
 Ford W. Harris
 Quality Management
 Walter A. Shewhart
 Bureaucratic Management
 Max Weber
 Administrative Management
 Henri Fayol
Taylor’s Four Principles of Scientific Management
 Scientifically study each part of a task and develop the best

method of performing the task.
 Carefully select workers and train them to perform the task

by using the scientifically developed method.
 Cooperate fully with workers to ensure that they use the

proper method.
 Divide work and responsibility so that management is

responsible for planning work methods using scientific
principles and workers are responsible for executing the
work accordingly.
Key Characteristics of Weber’s Ideal Bureaucracy
 Specialization of labor
 Formal rules and procedures
 Impersonality
 Well-defined hierarchy
 Career advancement based on merit

Fayol’s 14 Principles of Management
1. Division of work 8. Centralization

2. Authority 9. Scalar chain
3. Discipline 10. Order
4. Unity of command 11. Equity
5. Unity of direction 12. Stability and tenure
6. Subordination of 13. Initiative
individual interest to the 14. Esprit de corps
general interest
7. Remuneration
Behavioral Perspective
 Thebehavioral perspective acknowledges that psychological and social
processes of human behavior can result in improvements in productivity
and work satisfaction.
 The Hawthorne effect - when a manager shows concern for employees, their
motivation and productivity levels are likely to improve.
 Human Relations Approach - the relationship between employees and a
supervisor is a vital aspect of management.
 Employee motivation
 Leadership style
Hawthorne Effect
The discovery that paying special

attention to employees motivates them to
put greater effort into their jobs.
(from the Hawthorne management studies, performed from 1924 –
1932 at Western Electric Company’s plant near Chicago)
Maslow’s Hierarchy of
Needs
Self-
Actualization
Need for Self Esteem
Need for Social Relations
Need for Security
Physical Needs
McGregor’s Theory X and Theory Y
 Leaders
and managers who hold Theory X assumptions believe that
employees are inherently lazy and lack ambition.
A negative perspective on human behavior.
 Leadersand managers who hold Theory Y assumptions believe that most

employees do not dislike work and want to make useful contributions to
the organization.
A positive perspective on human behavior.
Contemporary Management Perspectives
 Systems Theory
 Contingency Theory
 The Learning Organization Perspective

Systems Theory
 Views the organization as a system of interrelated parts that function
in a holistic way to achieve a common purpose.
 Systems theory concepts that affect management thinking:

 Open and closed systems
 Subsystems
 Synergy
 Equifinality
Contingency Theory
 States that there is no “one best way” to manage an organization.
 Because what works for one organization may not work for another
 Situational characteristics (contingencies) differ
 Managers need to understand the key contingencies that determine the most
effective management practices in a given situation
The Learning Organization
 Themanagement approach based on an organization anticipating
change faster than its counterparts to have an advantage in the
market over its competitors.
 There are two ways organizations can learn:

 Experimental learning
 External learning
BusinessOrganization
Business Organizationand
and
EnvironmentalFactors
Environmental Factors
• An organization is a group of people
intentionally organized to accomplish a
common or set of goals.

Types of Business Organizations
Sole Proprietorships - One owner
Partnerships - Two or more people share the ownership
Corporations - unique entity
Joint Stock Company – Main organization form joint venture
Public Corporations – owned by Government centre to state.
Government Companies - state enterprise (central or one
or more state)

CLASSIFICATION OF
ENVIRONMENTAL FACTORS
• Internal Environmental Factors - the environment that has a direct
impact on the business. generally controllable because the company
has control over these factors. (resources, capabilities and culture).
• External Environment Factors - the environment that has an
indirect influence on the business. The factors are uncontrollable by
the business. The two types of external environment are micro
environment and macro environment.

EXTERNAL
ENVIRONMENT

New
New Workplace
Workplace Issues
Issues and
and Challenges
Challenges
Technology and Speed
Networking and
Boundaryless Globalization
Relationships and Diversity
Ethics and Knowledge,

Social Learning,
Responsibility Quality, and
Continuous
Improvement
Participative
Management, Knowledge
Empowerment, Management
and Teams
GENERATIONAL DIFFERENCES Change, Creativity, Innovation,
and Entrepreneurship

New
New Workplace
Workplace Issues
Issues and
and Challenges
Challenges (cont’d)
(cont’d)
• Knowledge, Learning, Quality, and Continuous Improvement

– Information is the foundation of knowledge which, in turn, is the
foundation of competitive advantage. People (employees) are the
competitive advantage!
• Knowledge workers
• The learning organization
• Knowledge Management
– Involves everyone in an organization in sharing knowledge and
applying it to continuously improve products and processes.

New
New Workplace
Workplace Issues
Issues and
and Challenges
(cont’d)
• Change, Creativity, Innovation, and Entrepreneurship

– Knowledge management requires that people change in order to
continually improve.
– The speed of change in modern business has increased because
of globalization and changes in technology. And other factors
listed.
– Creativity is coming up with new ideas for improvements, and
innovation is implementing those ideas.
– Entrepreneurship is about generating creative ideas and using
them through innovation.

New
New Workplace
Workplace Issues
Issues and
and Challenges
(cont’d)
• Participative Management, Empowerment,

and Teams
– Empowering employees to share in
performing management functions by
working in teams.
– Learning organizations manage knowledge
well by empowering teams to be creative
and innovative.
• Ethics and Social Responsibility
– Managerial integrity
• SOX Compliance after Financial Scandals
– Situational responses
• e. g. Katrina

New
New Workplace
Workplace Issues
Issues and
and Challenges
(cont’d)
• Networking and Boundaryless Relationships

– Electronic networks
• Beware the informality of e-mail, miss-interpreted
messages and first impressions
• Can be distracting/off task
– Relationship networks
– Virtual integration
QUESTION – ARE ELECTRONIC “TOOLS” CHANGING THE QUALITY OF

RELATIONSHIPS? E-Mail, NetMeeting, Video Conferences?

EARLY MANAGEMENT
09/10/2020 Lecture ppt by Ms.M.A.Madhumathi., AP/EEE 1–53

• ..\management-11th-edn-by-stephen-p-robbins-mary-coult
er-pdf-qwerty80.pdf

Microsoft
Microsoft Case
Case Questions
Questions
4. Bill Gates' participation
1.Which type in and
of resource
coordination
played
of small units and his delegation of authority to
managers to runthe their
most
departments
important role
are examples
in the of the __ management function.
a. planning c. success
leading of Microsoft?
b. organizing d. a. human
controllingc. financial
b. physical d. informational
5. Which primary management role did Bill Gates use to achieve success?
a. interpersonal-leader
2. Which of the management
skills is stressed most in the
b. informational-monitor
case study?
c. decisional-negotiator
a. technical
b. human
6. Bill Gates is at which leveland
of communication
management?
a. top b. middle c. conceptual and decision-
c. first-line
making
3. Which of the management

functions is stressed most in
the case study?
a. planning c. leading
b. organizing d. controlling

Microsoft
Microsoft Case
Case
10. Would Ghiselli
7. Which
(6 Traits
type of
– page
manager
10) agree
is Billthat Bill Gates has supervisory ability?
a. Yes Gates?
b. No
a. general
b. functional
11. Give examples of some of the tasks Bill Gates performs in each of the four management
functions. c. project
12. Give examples

8. Bill of some
Gates hasofgreater
the tasks Billfor
need Gates performs in each of the three management roles.
which skills?
13. Do you think a. you wouldrather
technical like tothan
work tor Bill Gates? Explain your answer.
conceptual
14. Are Bill Gates and Microsoft
b. conceptual ethical
rather thanand socially responsible?
technical
c. a balance of both
9. How does Bill Gates spend most

of his time?
a. planning and organizing
b. leading and controlling
c. a balance of both a and b

Back
Back Up
Up Slides
Slides

Learning
Learning Outcomes
Outcomes
After studying this chapter, you should be able to:
1. Describe a manager’s responsibility.
2. List and explain the three management skills.
3. List and explain the four management functions.
4. Identify the three management role categories.
5. List the hierarchy of management levels.
6. Describe the three different types of managers.
7. Describe the differences among management levels in terms of
skills needed and functions performed.

Learning
Learning Outcomes
Outcomes (cont’d)
(cont’d)
8. Define the following key terms:
manager planning
manager’s resources organizing
performance leading
management skills controlling
technical skills management role categories
human and communication
skills levels of management
conceptual and decision-
making skills types of managers
management functions knowledge management

New
New Workplace
Workplace Issues
Issues and
and Challenges
(cont’d)
• Technology and Speed

– E-business: work done by using electronic linkages (including the
Internet) between employees, partners, suppliers, and customers.
– E-commerce: business exchanges or transactions that occur
electronically.
• Globalization and Diversity
– Mergers are creating larger globalized firms.
– Firms competing globally have to act locally.
– Diversity is increasing as minorities grow and markets globalize.

E-Commerce
E-Commerce
Exhibit 1–8
Learning
Learning Outcomes
Outcomes
After studying this appendix, you should be able to:
1. State the major similarities and differences between the
classical and behavioral theorists.
2. Describe how systems theorists and contingency theorists differ
from classical and behavioral theorists.
3. Define the following key terms:
classical theorists systems theorists
behavioral theorists sociotechnical theorists
management science theorists contingency theorists

Classical
Classical Theory
Theory
• Classical Theorists
– Focus on the job and management functions to determine the best
way to manage in all organizations.
• Scientific Management
– Best way to maximize job performance
– Fredrick Winslow Taylor
• Father of Scientific Management
– Frank and Lillian Gilbreth
• Work efficiency
– Henry Gantt
• Work scheduling

Classical
Classical Theory
Theory (cont’d)
(cont’d)
• Administrative Theory
– Henri Fayol
• Father of Modern Management
• Principles and functions of management
– Max Weber
• Bureaucracy concept
– Chester Barnard
• Authority and power in organizations
– Mary Parker Follett
• Worker participation, conflict resolution, and
shared goals

Behavioral
Behavioral Theory
Theory
• Behavioral Theorists
– Focus on people to determine the best way to manage in all
organizations.
• Human Relations Movement (later, the Behavioral Science
Approach)
– Elton Mayo
• Hawthorne studies
– Abraham Maslow
• Hierarchy of needs theory
– Douglas McGregor
• Theory X and Theory Y

Management
Management Science
Science
• Management Science Theorists
– Focus on the use of mathematics to aid in problem solving and
decision making.
– Mathematical models are used in the areas of finance,
management information systems (MIS), and operations
management.

Integrative
Integrative Theories
Theories
• Systems Theory
– Focuses on viewing the organization as a whole and as the
interrelationship of its parts (subsystems).
• Sociotechnical Theory
– Focuses on integrating people and technology.
• Contingency Theory
– Focuses on determining the best management approach for a
given situation.

Comparing
Comparing Theories
Theories
Attempts to develop the best way to manage in all organizations

Classical by focusing on the jobs and structure of the firm.
Attempts to develop a single best way to manage in all

Behavioral organizations by focusing on people and making them productive.
Management Recommends using math (computers) to aid in problem solving

Science and decision making.
Systems Manages by focusing on the organization as a whole and the

interrelationship of its departments, rather than on individual
Theory parts.
Sociotechnical Recommends focusing on the integration of people and

Theory technology.
Contingency Recommends using the theory or the combination of theories that

Theory best meets the given situation.
Exhibit AP1–2
Ideas
Ideas on
on Management
Management at
at Gap
Gap
1. What resources does Gap use to sell its

merchandise?
2. What management functions are performed at Gap
stores?
3. What levels and types of managers have careers at
Gap?
4. How does Gap meet new workplace issues and
challenges?

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MG6851- PRINCIPLES

09/10/2020 Lecture ppt by Ms.M.A.Madhumathi., AP/EEE 3

GEORGE. R. TERRY Distinct process consisting of planning, organizing, actuating

HENRY FAYOL To manage is to forecast and to plan, to organize , to command,

NEWMAN, SUMMER, The job of management is to make co-operative endeavour to

The principles of management are the activities that

Lecture ppt by Ms.M.A.Madhumathi., AP/EEE 7

09/10/2020 Lecture ppt by Ms.M.A.Madhumathi., AP/EEE 8

• The better you can work with people, the more

Lecture ppt by Ms.M.A.Madhumathi., AP/EEE 1–10

Lecture ppt by Ms.M.A.Madhumathi., AP/EEE 1–11

• Management Qualities (Survey of Execs.)

MAIN FUNCTION SUB-ORDINATE FUNCTION

DIRECTING DECISION MAKING

Lecture ppt by Ms.M.A.Madhumathi., AP/EEE 1–17

Lecture ppt by Ms.M.A.Madhumathi., AP/EEE 1–18

Lecture ppt by Ms.M.A.Madhumathi., AP/EEE 1–21

INDIVIDUAL CONTRIBUTORS OFTEN REPORT ANYWHERE

Lecture ppt by Ms.M.A.Madhumathi., AP/EEE 1–22

Lecture ppt by Ms.M.A.Madhumathi., AP/EEE 1–23

Lecture ppt by Ms.M.A.Madhumathi., AP/EEE 1–26

Lecture ppt by Ms.M.A.Madhumathi., AP/EEE 1–27

ALSO OFTEN APPLIES TO NON-PROFITS AND CIVIC

Early Management Classical Perspective

 Early ideas about leadership

 Early ideas about the design and organization of work

 Scientifically study each part of a task and develop the best

 Carefully select workers and train them to perform the task

 Cooperate fully with workers to ensure that they use the

 Divide work and responsibility so that management is

 Formal rules and procedures

 Career advancement based on merit

1. Division of work 8. Centralization

The discovery that paying special

Need for Self Esteem

Need for Social Relations

Need for Security

 Leadersand managers who hold Theory Y assumptions believe that most

 The Learning Organization Perspective

 Systems theory concepts that affect management thinking:

 There are two ways organizations can learn:

09/10/2020 Lecture ppt by Ms.M.A.Madhumathi., AP/EEE 43

09/10/2020 Lecture ppt by Ms.M.A.Madhumathi., AP/EEE 44

09/10/2020 Lecture ppt by Ms.M.A.Madhumathi., AP/EEE 45

09/10/2020 Lecture ppt by Ms.M.A.Madhumathi., AP/EEE 47

Ethics and Knowledge,

Lecture ppt by Ms.M.A.Madhumathi., AP/EEE 1–48

• Knowledge, Learning, Quality, and Continuous Improvement

Lecture ppt by Ms.M.A.Madhumathi., AP/EEE 1–49

• Change, Creativity, Innovation, and Entrepreneurship

Lecture ppt by Ms.M.A.Madhumathi., AP/EEE 1–50

• Participative Management, Empowerment,

Lecture ppt by Ms.M.A.Madhumathi., AP/EEE 1–51

• Networking and Boundaryless Relationships

QUESTION – ARE ELECTRONIC “TOOLS” CHANGING THE QUALITY OF

Lecture ppt by Ms.M.A.Madhumathi., AP/EEE 1–52

09/10/2020 Lecture ppt by Ms.M.A.Madhumathi., AP/EEE 1–53

09/10/2020 Lecture ppt by Ms.M.A.Madhumathi., AP/EEE 1–55

3. Which of the management