GE3751 POM course material for Final year Electronics and communication Engineering Department also common for other department.pptx

POM Material

1. GE3751 - PRINCIPLES OF MANAGEMENT COURSE MATERIAL 1– 1

2. OVERVIEW OF MANAGEMENT UNIT 1– 2 1

3. What Is Management? Managerial Concerns Efficiency “ Doing things right ” Getting the most output for the least inputs Effectiveness “ Doing the right things ” Attaining organizational goals – What is management? – Management involves coordinating and overseeing the work activities of others so that their activities are completed efficiently and effectively. 1– 3

4. Classifying Managers First-line Managers Individuals who manage the work of non-managerial employees. Middle Managers Individuals who manage the work of first-line managers. Top Managers Individuals who are responsible for making organization-wide decisions and establishing plans and goals that affect the entire organization. 1– 4

5. Managerial Levels 1– 5

6. Functions of Management

7. Pla n ning Defining goals, establishing strategies to achieve goals, developing plans to integrate and coordinate activities.

8. Organizing Arranging and structuring work to accomplish organizational goals.

9. Staffing The selection and training of individuals for specific job functions, and charging them with the associated responsibilities. The act of keeping positions filled in organization structure 1– 9

10. Leading/Directing Involves motivating subordinates, influencing individuals or teams as they work, selecting the most effective communic a tion ch a nne ls

11. Management Roles Managerial roles Leader Figurehead Entrepreneur Disturbance handler Spokesperson Mo n itor Negotiator Resource Allocator In f orma t ional roles Interpersonal roles Dec i sional roles

12. What Is An Organization? An Organization Defined A deliberate arrangement of people to accomplish some specific purpose (that individuals independently could not accomplish alone). Common Characteristics of Organizations Have a distinct purpose (goal) Composed of people Have a deliberate structure 1– 12

13. 1– 13

14. Principles of Scientific Management 1– 14 Replacing Rule of Thumb with science Harmony, not discord Co-operation, not individualism Maximum output, in place of restricted output The development of each man to his greatest efficiency.

15. Comparison : Management as As An art B ased on P ractice and creativity . I t is a theoretical b ody of knowledge . H as P ersonalized A pplication . As a Science B ased on E x p e r imentation . I t is a systematized body of knowledge . H as U niversal A pplication .

16. DIVISION OF WORK OR SPECIALIZATION AUTHORITY AND RESPONSIBILITY DISCIPLINE UNITY OF COMMAND UNITY OF DIRECTION SUBORDINATION OF INDIVIDUAL TO GENERAL REMUNERATION CENTRALIZATION LINE OF COMMAND/SCALAR CHAIN ORDER EQUITY STABILITY OF TENURE INITIATIVE ESPRIT DE CORPS II. Modern O p eratio n al Man a gement Theory 1 4 Principles of H enri Fayol

17. B U SINESS A business (also called a company , enterprise or firm ) is a legally recognized organization designed to provide goods and/or services to consumers . 1–17

18. Forms of Business Organization sole proprietorship or sole trader partnership corporation share of stock board of directors dividends S lide 18

19. Sole Proprietorship/ sole trader It is a type of business entity which is owned and run by one individual

20. Partnership a business owned by two or more people

21. C o rporation a business that has the legal rights of a person but is independent of its owners

22. Internal & External Environment classification: Internal Environment 1. Resources 2 . Capabili t ies 3. Culture External Environment: 1. specific environment a. Customers c. Competitors General Environment a. Economic conditions c. Socio-cultural Conditions e. Technological Conditions b. Suppliers d. Pressure Groups b. Political/Legal Conditions d. Demographic Conditions f. Global conditions

23. 23 TRENDS AND CHALLENGES OF MANAGEMENT IN GLOBAL SCENARIO Workforce diversity Changing employee expectation International environment Building organizational capabilities Job design & organizational structure Changing psycho-social system Technological advance Management of human relations Changes in legal environment Expanding globalisation

24. 1–24 UNIT 2 PLANNING

25. What is Planning? 25 Deciding in advance what to do, how to do it , when to do it and who has to do it. Planning is the pre-selection of objectives and outlines the action before starting any business. Planning is decision making in advance. Choosing the alternatives and making the decision is called planning.

26. Nature of Planning 26 Goal oriented: Every plan must contribute in some positive way towards the accomplishment of objectives. Primary of Management: Planning is the first of the managerial functions Efficiency, Economy and Accuracy Co-ordination Limiting Factors: money, manpower etc Flexibility Planning is an intellectual process: The quality of planning will vary according to the quality of the mind of the manager.

27. Importance of Planning Provides direction Leads to economical utilization of resources Reduces the risks Facilitates decision making Encourages Innovation & Creativity Improves morale Facilitates control

28. Being Aware of opportunities Market, competition, Customers, Strengths Weakness Establishing objectives Where we want to be, what to achieve and when Developing premises In what environment ( I & E), scenarios Determining alternative courses How many and which are most promising Evaluating alternative courses In the light of objectives Selecting a course Formulating derivative plans Quantifying plans by budgeting Steps in planning

29. 29 Types of Plans Long range Vs Short range Strategic Vs Operational Corporate Vs Functional Proactive Vs Reactive Standing Vs Single Use

30. 30 Standing Vs Single Use Standing Plans Developed for activities that recur regularly over a period of time Ex: Objectives, Policies, Procedures, Methods, Rules Single Use plans Developed to carry out a course of action that is not likely to be repeated in future Ex: Programmes, Schedules, Projects, Budgets

31. Hierarchy of Plans Mission or purposes Objectives or goals Strategies Policies Procedures Rules Programs Budgets

32. Introd u ction Aims, purpose or goals that an organization wants to achieve over varying periods of time Characteristics of Objectives: Have a hierarchy Objectives form a network Multiplicity of objectives Have a time span Tangible or intangible Must have a social sanction 1– 32

33. Significance of Objectives Unified planning Defining an organization Direction Individual motivation Basis for decentralization Basis for control Coordination 1– 33

34. Areas of Setting Objectives Market standing Innovation Productivity Resources – physical & financial Profitability Manager performance & development Worker performance, attitude & development Public responsibility 1– 34

35. Benefits of Objectives Sets specific targets A tool for setting standard of performance Provides direction for the employee Increases motivation Allows monitoring of progress, targets & success Improves overall communication Helps focus on specific task Helps prioritize 1– 35

36. SMART Objectives 1– 36

37. Management by Objectives (MBO) 1– 37

38. Introd u ction Conceptualized by Peter. F. Drucker Put to use by Harold Smiddy of GE Used worldwide since Management system in which each member of organization effectively participates Koo n tz & We i h r ic h – ― MBO is a c om p r e h e n s i v e managerial system that integrates many key managerial activities in a systematic manner & that is consciously directed towards efficient & effective achievement of organization & individual objectives‖ 1– 38

39. Management by Objectives (MBO) 4 major activities: Set goals Develop action plans Review progress Appraise overall performance

40. Step 1: Set Goals Take Corrective Action Review Progress Step 3: Review P r o g r ess Appraise Performance Step 4: Appraise Overall Performance Action Plans Step 2: Develop Action Plans Corporate Strategic Goals Departmental Goals Individual Goals

41. Benefits of MBO Problems with MBO 1. Improvement of management 1. Danger of inflexibility 2. Performance can be improved at all company levels. 2. An environment of poor employer-employee relations reduces MBO effectiveness. 3. Employees are motivated. 3. Strategic goals may be displaced by operational goals. 4. Departmental and individual goals are aligned with company goals. 4. Mechanistic organizations and values that discourage participation can harm the MBO process. 5. Too much paperwork saps MBO energy.

42. Strategic Management The s e t of man a g e ri a l d e c i s io n s a n d actions that determines the long-run performance of an organization. 42

43. FORMATION OF MISSION & OBJECTIVES SWOT A N A L YSIS CONSIDE R A T I ON OF STRATEGIC ALTERNATIVES EVALUATION AND CONTROL IMPLEMENTATION CHOICE OF STRATEGY STRATEGIC MANAGEMENT PROCESS

44. DECISION MAKING PROCESS 1–44

45. 45 Decisions and Decision Making Decision = choice made from available alternatives Decision Making = process of identifying problems and opportunities in each alternative and choosing the best

46. Six Steps in Decision Making Figure 7.4 7- 46

47. Decision Making Steps Step 1. Recognize Need for a Decision Managers must first realize that a decision must be made. Step 2. Generate Alternatives Managers must develop feasible alternative courses of action. If good alternatives are missed , the resulting decision is poor . It is hard to develop creative alternatives, so managers need to look for new ideas. 7- 47

48. Step 3. Evaluate Alternatives What are the advantages and disadvantages of each alternative? Managers should specify criteria, then evaluate. 7- 48

49. Step 4. Choose Among Alternatives 7- 49 Rank the various alternatives and make a decision Step 5. Implement Chosen Alternative Managers must now carry out the alternative. Step 6. Learn From Feedback Managers should consider what went right and wrong with the decision and learn for the future. Without feedback , managers do not learn from experience and will repeat the same mistake over.

50. Types of Decisions Programmed decision: A decision that is fairly structured or recurs (occur again)with some frequency (or both). Non-programmed decision: A decision that is relatively unstructured and occurs much less often than a PROGRAMMED DECISION.

51. Decision-Making Conditions Certainty Risk Uncertainty Level of ambiguity and chances of making a bad decision L o w er Moderate Higher The decision maker faces conditions of:

52. Nature & Purpose Policies Policies are the general statements of understandings which guide or channel thinking in decision – making or subordinates Nature Relationship to organizational objectives Clarity Guide to thinking in decision making Written Communication of policies Consistency Balance of policy Planned formulation 1–52

53. Policy Formulation Process Definition of policy area Creation of policy alternatives Evaluation of policy alternatives Choice of policy Communication Implementation Review TYPES Formulated,Appealed,Imposed,Written,Implied 1– 53

54. UNIT-3 ORGANIZING 1– 54

55. 11 - 55 What Is Organizing? Deciding how best to group organizational activities and resources. Organizing: the process by which managers establish working relationships among employees to achieve goals.

56. NATURE OF ORGANIZING: Group of Persons Common Objectives Division of Work Co-ordination Communication C e n t ral Aut h o r ity Rules & Regulations Environment

57. IMPORTANCE OF ORGANIZING 1. Facilitates A d ministrat i on 2. Encourages Growth & Div e rsif i cation 3. Optimum Use of Technology 4. Stimulates Innovation & Technology 5. Encourages Good Human Relations 6. Ensures Continuity of Enterprise 7. Coordination

58. PROCESS: 1. 2. 3. 4. I D ENT I FIC A T I ON OF ACTI V IT I ES GROUPING OF ACTIVITIES ASSIGNMENT OF DUTIES DELEGATION OF AUTHORITY

59. Formal and Informal Organization Formal structure is defined as the relationships among organizational resources as outlined by management. 9 Informal structure is defined as the patterns of relationships that develop because of the informal activities of organization members.

60. 1– 60

61. 1– 61 DEPARTMENTATION The basis by which jobs are grouped together. Forms (or) Types Departmentation by Function Departmentation by Geography Departmentation by Customer Group Departmentation by Product Departmentation by Process

62. Functional/Divisional Structures A division is a collection of functions working together to produce a product. Product structure: divisions created according to the type of product or service. Geographic structure : divisions based on the area of a country or world served. Market structure: divisions based on the types of customers served.

63. Product Structure Washing Machine Division L i gh t i n g D i v i s i o n T e l e v i s i o n Division CEO Corporation C o r po r a t e M a n a g e r s

64. Geographic Structure CEO Corporation C o r po r a t e M a n a g e rs N o r t h e rn Region W e s t e rn Region S ou t h e rn Region E a s t e rn R e g i o n

65. Market Structure CEO Corporation C o r po r a t e M a n a g e rs L a r g e B u s i n e s s Customers S m a l l B u s i n e s s Customers Educational Institutions Individual Customers

66. Line VS Staff 1–72

67. Matrix Organization Project A Project B Project C Functional Control Projec t - based Control Engineering Production Logistics Design

68. Team Organization Functional Control Engine e ring Production Logistics De sign Team Leader Member A Member B Member C Member D

69. CENTRALIZATION 1– 76

70. 1– 77

71. Advantages & Disadvantages Centralization ADVANTAGES: Provide Power Minimal extensive controlling procedures and practices Minimize duplication of function DISADVANTAGES: less motivated Neglected functions for mid. Level 1– 78

72. Advantages & Disadvantages Decentralization ADVANTAGES: Quicker Decisions Motivation of Local Managers Reduces workload DISA D VA N TAGES: Loss of Control Duplication of Services 1– 79

73. Delegation of Authority (Distributing Authority) Authority: Power that has been legitimized by the organization. Delegation: The process by which managers assign a portion of their total workload to others. 11 - 80

74. MOTIVATION to subordinates Holding A C CO U N T A B IL I TY TRAINING to subordinates Establ i shing CONTROL Define RES P ONSIBI LITY and AUTHORITY Determining the GOAL P R O C E S S O F D E L EG A T I ON

75. I M P O RTANC E O F D E LEGATION Relief to top managers. Development of managers. Development of subordinates. Better decision-making. Specialization. Job satisfaction.

76. B A R R IER S T O D E L E G ATION Insecurity. Lack of confidence in subordinates. Fear of making mistakes. Lack of initiative. Absence of access to various resources.

77. W A Y S T O O V E R COM E B A RR IERS T O D E L E GA T I O N Develop confidence Communication. Motivation. Choose the right person for the right job. Freedom to subordinates. Clarity of task. Matching the jobs with abilities of subordinates.

78. "Staffing means filling and keeping filled, positions in the organisation structure." Harold K o o n tz

79. IMPORTANCE OF STAFFING FILLING ORGANISATIONAL POSITIONS: Concerned with filling of good systematic staffing. DEVELOPING COMPETENCIES: Right job according to right person. RETAINING PERSONNEL: Continuing them in the organization.

80. ELEMENTS OF STAFFING Manpower planning Job analysis Recruitment and selection Training and Development Performance appraisal

81. SCOPE OF STAFFING Hiring Remuneration Motivation Employee maintenance Human relations

82. Job analysis “Job analysis is the process of studying and collecting information relating to the operations and responsibilities of a specific job. The immediate products of this analysis are job descriptions and job specifications”.

83. 92 Job Analysis Tasks Responsibilities Duties Job Anal y sis Job Descriptions Job Specifications Knowledge Skills Abilities Human Resource Planning Recruitment Selection Training and Development Performance Appraisal Compensation and Benefits Safety and Health Employee and Labor Relations Legal Considerations Job Analysis for Teams

84. Recru i tme n t Sources Internal S e a r ch e s Empl o y ee Referrals Voluntary Applicants Employment Agencies Advertisements School Pla c e m ent Sources of Recruitment

85. Difference : Recruitment & selection RECR U I T M E N T SELECT ION To attract maximum number of candidates. To choose best out of the available candidates. It creates application pool as large as possible. It is a rejection process where few are selected. Techniques are not very intensive. Highly specialized techniques are required. Outcome is application pool. Outcome is the candidate who is offered job.

86. Recruitment RECRUITMENT Advertisement Employment agencies & selection process SELECTION Screening of applications Selection tests Interview Checking of Physical Approval by On campus recruitment Deput a tion ref e renc e s Employee recommendations examination Labor unions authority Gate hiring Placeme n t

87. Training & development TRAINING : “Training is a short term process utilizing a systematic and organized procedure by which non managerial personnel learn technical knowledge and skills for a definite purpose. DEVELOPMENT: “Development is a long term educational process utilizing a systematic and organized procedure by which managerial personnel learn conceptual and theoretical knowledge for general purpose”.

88. Role of training & development INCREASE IN EFFICIENCY INCREASE IN MORALE OF EMPLOYEES BETTER HUMAN RELATIONS REDUCED SUPERVISION INCREASED ORGANIZATIONAL VIABILITY & FLEXIBILITY

89. Appraisal Methods Graphic Rating Scale Critical Incidence method BARS Self Appraisal 180 Degree Appraisal 360 Degree Appraisal Management by Objective Balance Score Card

90. UNIT 1– 99 4 DIRECTING

91. Directing Involves motivating subordinates, influencing individuals or teams as they work, selecting the most effective communication channels or dealing in any way with employee behavior issues. 1– 100

92. Creativity - Defined Creativity is the development of ideas about products, practices, services, or procedures that are novel and potentially useful to the organization

93. Innovation - Defined Innovation is the implementation of new ideas at the individual, group or organizational level

94. ELEMENTS OF DIRECTION Com m unication Leading Motivation Supervision Coordination

95. COMMUNICATION

96. Communication and Management Communication – The sharing of information between two or more individuals or groups to reach a common understanding. 16 - 105

97. Communication and Management Importance of Good Communication Increased efficiency in new technologies Improved quality of products and services Increased responsiveness to customers More innovation through communication

98. The Communication Process

99. Most Common Way to Communicate Wri t i n g Visual ima g es Body language Speaking

100. Verbal & Nonverbal Communication 16- 109 Verbal Communication The encoding of messages into words, either written or spoken Nonverbal The encoding of messages by means of facial expressions, body language.

101. Communication Media Face-to-Face Has highest information richness. Can take advantage of verbal and nonverbal signals. 16- 110

102. Communication Media 16- 111 Spoken Communication Electronically Transmitted Has the second highest information richness. Telephone conversations are information rich with tone of voice, sender’s emphasis, and quick feedback, but provide no visual nonverbal cues.

103. Communication Media 16- 112 Personally Addressed Written Communication Has a lower richness Personal addressing helps ensure receiver actually reads the message— personal letters and e-mail are common forms.

104. Communication Media Impersonal Written Communication Has the lowest information richness. Good for messages to many receivers where little or feedback is expected (e.g., newsletters, reports) 16- 113

105. Commu n icat i on Networks in Groups and Teams 16- 114

106. New Technologies for Communication Informational databases Electronic mail systems Voice mail systems Fax machine systems Cellular phone systems

107. Barriers to Effective Communication Messages that are unclear, incomplete, difficult to understand Messages with no provision for feedback Messages that are misunderstood Messages delivered through automated systems that lack the human element 16 - 1 16

108. Downward Communication T r a v els f r om su p er i or t o subo r di n ates. T o gi v e sp e ci f i c tas k di r ecti v es about job instruction T o gi v e i n f ormation about organ i zati o n p r ocedu r es and p r actic e s

109. Upward Communication T r a v els f r om su b o r di n ate t o su p er i o r . The most comm o n pu r pose of this com m u n ica t i o n i s t o p r o vide f eedback o n h o w w ell th i ngs a r e g oing. It p r o vides also th e mi d dle l e v el managers the opportunity to represent the i r su b o r di n ates t o th e upp er l e v el managers.

110. Lateral Communication T a k es p l ace bet w een people i n the same l e v el of th e manageme n t h i era r c h y . The most common reason for this com m unica t i o n fl o w i s t o p r o vide coo r di n ation and team w ork

111. Diagonal Communication Occur s bet w een people wh o a r e neither in the same department nor in the same level of management hierarchy. In this cas e , some o ne com mun i ca te eit h er d o wnwa r d or up wa r d wit h someone in anoth e r fu n ctional a r ea.

112. O VERCO M ING B AR R IERS T O COMMUNICATION Us e f eedback t o faci l itat e u n dersta n di n g and i n c r ease th e potent i al f or a pp r opriate action Repeat message i n o r der t o p r o vide assu r ance tha t th e y a r e p r oper l y received

113. Us e m ultiple ch an n els so tha t the accuracy of th e i n f ormat i on m a y be enhanced Use simplified language that are easily u n dersta n dable and wh i ch el i mi n ates the poss i b i lit y of peop l e gett i ng mi x e d - up wit h meani n gs

114. MOTIVATION “ Motivation i s th e w ork a manager per f orms t o inspi r ed, encourag e , peop l e t o ta k e r equi red actio n ”

115. Need Theo r y P eo p l e a r e mo t iv a ted to ob t ain ou t comes at w ork to satisfy t h e i r n e ed s . Managers must determine what needs worker wants satisfied. Ensu r e that a pers o n r ecei v es the o utcomes when per f or m in g w ell . S e v eral n e eds t h e o ries exi s t. 🞄 Ma sl o w ’ s Hie ra r c h y of Needs. 🞄 Alder f er ’ s ERG.

116. Masl o w ’ s Hiera r c h y of Nee d s Self- A ctualizatio n Realize one’s full potential Use abilities to the fullest E s t ee m Feel good about oneself Promotions & recognition Belongingness Social interaction, love Interpersonal relations, parties S a fety Security, stability Job security, health insurance Physiological Food, water, shelter Basic pay level to buy items N e e d Le v e l D e sc ription E xam pl e s Lower level needs must be satisfied before higher needs are addressed.

117. Maslow’s Hierarchy of Needs SA Esteem Love (Social) Safety & Security Physiological

118. Motivational Theories X & Y SA Esteem Love (Social) Safety & Security Physiological Theory Y - a set of assumptions of how to manage individuals motivated by higher order needs Theory X - a set of assumptions of how to manage individuals motivated by lower order needs

119. Alderfer’s ERG Theory Safety & Security Love (Social) SA Esteem Exis t ence Physiological Relatedne s s Growth

120. Herzberg’s Two-Factor Theory Hygiene Factor - work condition related to dissatisfaction caused by discomfort or pain maintenance factor contributes to employee’s feeling not dissatisfied contributes to absence of complaints Motivation Factor - work condition related to the satisfaction of the need for psychological growth job enrichment leads to superior performance & effort

121. Natu r e and Characteris t ics Motivation Is an i n terna l f eel i ng M o tivat i on i s r elat e d t o needs M o tivat i on lea d t o g oal orie n ted behaviour M o tivat i on can be pos i ti v e or negat i v e

122. Importance of Motivation 1 . Puts h u man r esou r ces i n t o action E v e r y concern r eq u i r es p h ysi c al, fi n ancial and h u man r esou r ces to accomplish th e g oals.

123. 2 . Im p r o v es l e vel of eff i cie n cy of employees The l e vel of a su b o r di n ate or an emp l o y ee does not on l y depend upon h i s q u al i fic a tio n s and ab i l i ties.

124. Lead s t o a ch i e v ement of o rgan i zatio n a l goals The g oals of an enter p rise can be achieved Bui l ds fr i end l y r elat i onship M o tivat i on i s an im p o r tan t factor wh i ch br i ngs emp l o y ees sat i sfact i on.

125. Organizational Culture 1–134

126. Defi n ition The general pattern of behaviour, shared beliefs and values that organization members have in common. 1–135

127. ELEMENTS 1– 136 six ele m ents a r e: Stories: The pa s t e v ents and peop le tal k ed about i n side and outs i de the company. Rituals and Ro u tin e s: The dai l y behavior and actions of people that signal acceptable be h a vio r .

128. Symbo l s: The visu a l r e p r e sentat i o ns o f the compa n y i n cl u di n g lo g os Organizational Structure: This includes both the struct u r e defi n ed b y the organization chart, and the unwritten l i nes o f p o w e r . Control Systems: The ways that the organ i za t io n i s cont r olle d . Power Structures: involve one or two key senior executives, a whole group of e x ecut i v es, o r e v en a depa r tme n t 1– 137

129. Lead e rship I s… - P r ocess o f di r ecti n g th e be h a viour of others t o wa r d th e acc o mp l ishmen t s of objectives. - Is one o f th e impo r tan t pa r t s of di r ectio n .

130. LEADIN G I N TIME S OF CRISIS St a y calm Be vis i b l e Put peop l e be f o r e b u si n ess T ell th e truth Kn o w whe n t o get back to b u si n ess

131. Beh a vio r al Theories (LEADERSHIP STYLES) 1.Autocratic Leadership Under the autocratic leadership style, all decision-making powers are centralized in t h e leade r , as wi t h dictators. The autocratic mana g em e nt has b e en s u cces s ful as i t p r o vides s t r o n g m o tivation to t h e manage r . It p ermi t s quick deci s io n -maki n g.

132. 2.Participative Leadership cons i sts of th e leader sha r ing the decision-making abilities with group members b y p r om o ti n g th e i n te r ests of th e g r oup mem b ers and b y pract i ci n g social equality.

133. 3.Free- rein Leadership A pe r son m a y be i n a leade r sh i p pos i tio n wit h out p r o vid i ng leade r sh i p , le a vi n g th e g r oup t o f end f or itse l f. Subordinates are given a free hand in deciding their own policies and methods.

134. 4. T o xic leadership A t o x i c leade r i s some o ne wh o has r es p ons i bil i t y o v er a g r oup of peop l e or an organization.

135. Impo r tanc e of Leadersh i p Initiates action - Leader is a person who sta r t s th e w ork b y com m u n icatin g the pol i cies and p l ans t o th e subo r di n ates f r om whe r e th e w ork actua l l y sta r ts. Moti v atio n - He motivat e s the emp l o y ees wit h economic and no n - economic r e wa r ds and the r e b y gets the w ork f r om th e subo r di n ates.

136. P r o vid i n g guidan c e - Gu i dance he r e means i n str u cting th e subo r di n ates the w a y th e y h a v e t o pe r f orm the i r w ork ef f ecti v e l y and effic i ent l y . Creating confidence - Confidence is an im p o r t a nt factor whic h can be ach i e v ed th r ough ex p r ess i ng th e w ork ef f o r t s to th e su b o r di n ates,

137. Building morale - Morale denotes wi l l i ng co - operation of th e emp l o y ees t o wa r ds the i r w ork and gett i ng them i n to conf i dence and win n i ng the i r tr u st. Builds work environment- An efficient w ork e n vi r onme n t he lps i n sou n d and stab l e g r o wth . He s h ould t r eat emp l o y ees on huma n itar i a n terms. C o -o r d i na t io n - This syn c h r onization can be achieved through proper and effective c o - o r dinat i o n whic h shou l d be pr i ma r y moti v e of a leade r .

138. UNIT-5 CONTROLLING 1–147

139. The Purpose of Control Adapt to environmental change Limit the accumulation of error Control helps the organization Cope with organizational complexity Minimize costs 20 - 148

140. Levels of Control 20 - 149

141. Steps in the Control Process Establish standards. Measure performance. Compare performance against standards. Determine need for corrective action. The sub-steps: Maintain status quo. Correct deviation. Change standards. 20 - 150

142. Steps in the Control Process 20 - 151

143. Types of Control

144. BUDGETARY CONTROL The establishment of budgets, relating the responsibilities of executives to the requirements of a policy 1– 153

145. Salient features: Objectives: Determining the objectives Activities: Determining the variety of activities Plans: Drawing up a plan Performance Evaluation: Laying out a system of comparison of actual performance Control Action: Ensuring that when the plans are not achieved, corrective actions are taken 1– 154

146. CLASSIFICATION OF BUDGETS 1– 155

147. Long Term Budget: prepared for periods longer than a year ex: R&D Budget Short Term Budget: less than year ex:cash budget Basic Budget: remains unaltered Current Budget: related to the current conditions Fixed Budget: remain unchanged Flexible Budget: various budgets for different levels of activity Functional Budget: the individual functions in an organization Master Budget: Profit & Loss Account 1– 156

148. BUDGETARY CONTROL TECHNIQUES Revenue and Expense Budgets: Time, Space, Material, and Product Budgets: Capital Expenditure Budgets Cash Budgets Variable Budget Zero Based Budget 1– 157

149. NON-BUDGETARY CONTROL TECHNIQUES Statistical data: Break- even point analysis Operational audit: Personal observation PERT( Program (or Project) Evaluation and Review Technique ): GANTT CHART: 1– 158

150. vi) a type of bar chart that illustrates a project schedule Gantt charts illustrate the start and finish dates of the terminal elements and summary elements of a project.

151. PRODUCTIVITY Productivity refers to the ratio between the output from production processes to its input.

152. Typical Productivity Calculations Physical Productivity This is a ratio of the amount of product to the resources consumed. Functional Productivity This is a ratio of the amount of the functionality delivered to the resources consumed Economic Productivity ratio of the value of the product produced to the cost of the resources used to produce it.

153. COST CONTROL Cost control is the measure taken by management to assure that the cost objectives set down in the planning stage are attained

154. Advantages of cost control Better utilization of resources To prepare for meeting a future competitive position. Reasonable price for the customers Improves the image of company for long-term benefits. Improve the rate of return on investment.

155. PURCHASE CONTROL Purchase control is an element of material control. The advantages derived from a good and adequate system of the purchase control are as follows: Continuous availability of materials Purchasing of right quantity Economy in purchasing Works as information centre Development of business relationship Finding of alternative source of supply Fixing responsibilities

156. MAINTENANCE CONTROL Maintenance department has to excercise effective cost control, to carry out the maintenance functions in a pre- specified budget First line supervisors must be apprised of the cost information of the various materials A monthly review of the budget provisions and expenditures actually incurred in respect of each center/shop The total expenditure to be incurred can be uniformly spread over the year The controllable elements of cost such as manpower cost and material cost can be discussed

157. QUALITY CONTROL Quality control refers to the technical process that gathers, examines, analyze & report the progress of the project & conformance with the performance requirements

158. steps involved in quality control process are Determine what parameter is to be controlled. Establish its criticality Establish a specification for the parameter to be controlled Produce plans for control Organize resources to implement the plans Install a sensor at an appropriate point Collect and transmit data to a place for analysis Verify the results and diagnose the cause of variance. Propose remedies and decide on the action Take the agreed action and check that the variance