Principles of Management Unit 1 Overview of Management.pptx

Principles of Management

1. Kongunadu college of engineering and technology (AUTONOMOUS) (Approved by AICTE, New Delhi, Affiliated to Anna University, Chennai, Accredited by NAAC B++ Grade , Accredited by NBA, Recognized by UGC with 2(f) & 12(B) An ISO 9001:2015 certified Institution) Namakkal - Trichy Main Road, Thottiam , Trichy - 621215 SUBJECT CODE & NAME 20MG501 PRINCIPLES OF MANAGEMENT Prepared by, Dr. P. Dineshkumar M.E., Ph.D., Assistant Professor, Department of Agricultural Engineering, Kongunadu College of Engineering and Technology . 1 Dr. P. Dineshkumar / AP / AGE / KNCET

2. UNITS Overview of Management. Planning. Organising . Directing. Controlling. 2 Dr. P. Dineshkumar / AP / AGE / KNCET

3. OVERVIEW OF MANAGEMENT Introduction to Management and Organization – Management Functions – Types of Managers – Managerial Roles and Skills – Evolution of Management Theory – Managing a Global Environment – Social Responsibility and Managerial Ethics – Organization’s Culture – Source, Types of Organization. Dr. P. Dineshkumar / AP / AGE / KNCET 3

4. WHAT IS MANAGEMENT? Efficiency “ Doing things right ” Getting the most output for the least inputs Effectiveness “ Doing the right things ” Attaining organizational goals Dr. P. Dineshkumar / AP / AGE / KNCET 4

5. WHAT IS MANAGEMENT? Management is a problem solving process of effectively achieving organizational objectives by effective utilization use of scarce resources in a changing environment . Management is thus the process of planning, organising , staffing , directing and controlling human efforts to achieve organizational objectives effectively. Dr. P. Dineshkumar / AP / AGE / KNCET 5

6. DEFINITIONS OF MANAGEMENT “ Management is the process of designing & maintaining an environment in which individuals, working together in group , efficiently accomplish selected goals .” - Koontz and Weihrich “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 Dr. P. Dineshkumar / AP / AGE / KNCET 6

7. IMPORTANCE OF MANAGEMENT Optimum and profitable utilization of resources. Effective leadership and motivation. Establishing sound industrial relations. Achievement of goals and objectives. Change and growth. Improves standard of living. Dr. P. Dineshkumar / AP / AGE / KNCET 7

8. FUNCTIONS OF MANAGEMENT Dr. P. Dineshkumar / AP / AGE / KNCET 8

9. PLANNING The first and the most important function of management is Planning. Planning involves setting objectives in advance, a goal which is to be achieved within a stipulated time. Dr. P. Dineshkumar / AP / AGE / KNCET 9

10. Planning is the most basic function of management. It is deciding in advance what to do and how to do when to do and by whom it is to be done. All the other functions of management like organising , staffing, directing, controlling are dependent on planning. Planning is related to future and is a continuous process. “Planning is deciding in advance what is to be done .When a manager plans, he projects a course of action for the future, attempting to achieving a consistent, coordinated structure of operation aimed at desired result” Dr. P. Dineshkumar / AP / AGE / KNCET 10

11. IMPORTANCE OF PLANNING Planning increase efficiency. Planning reduces business related risks. Planning provides direction. Planning helps in motivation. Planning helps in decision making. Planning helps to achieve objectives. Planning provides basis of control. Dr. P. Dineshkumar / AP / AGE / KNCET 11

12. STEPS IN PLANNING PROCESS Establishing verifiable goals. Establishing Planning Premises. Deciding the Planning Period. Finding alternative course of action. Evaluating and selecting a course of action. Dr. P. Dineshkumar / AP / AGE / KNCET 12

13. ORGANISING “ Organising is the process of identifying and grouping the work to be performed defining and delegating responsibility and authority and establishing relationships for the purpose of enabling people to work most effectively together in accomplishing objectives” After planning the next function of management is organising . Organising involves division of work among people whose efforts must be coordinated to achieve specific objectives and to implement pre-determined strategies. Dr. P. Dineshkumar / AP / AGE / KNCET 13

14. Dr. P. Dineshkumar / AP / AGE / KNCET 14

15. IMPORTANCE OF ORGANISING It facilitates efficient management. It facilitates coordination and communication. It facilitates growth and diversification. It ensures optimum use of resources. It provides for optimum use of technological innovations. It facilitates specialization. Dr. P. Dineshkumar / AP / AGE / KNCET 15

16. STAFFING “Staffing involves manning the organization structure through proper and effective selection appraisal and development of personal to fill the roles designed into the structure.” The staffing function deals with the human elements of management. The staffing function has assumed great importance these days because of rapid advancement of technology, increasing size of organizations and complex behavior of human beings. Dr. P. Dineshkumar / AP / AGE / KNCET 16

17. IMPORTANCE OF STAFFING Helps in finding efficient worker. Helps in increased Productivity. Maintains Harmony. Helps in morale boosting. Helps in Optimum utilization of human resources Dr. P. Dineshkumar / AP / AGE / KNCET 17

18. DIRECTING “Direction is the interpersonal aspect of managing by which subordinates are led to understand and contribute effectively and efficiently to the attainment of enterprise objectives.” Dr. P. Dineshkumar / AP / AGE / KNCET 18

19. IMPORTANCE OF DIRECTING Initiates action. Creates a Sound work environment. Develops managers. Behavioral satisfaction. Increase in productivity. Achieves coordination. Facilitates control. Facilitates change. Facilitates growth. Dr. P. Dineshkumar / AP / AGE / KNCET 19

20. CONTROLLING “Controlling is the process of checking whether or not proper progress is being made towards the objectives and goals and acting if necessary, to correct any deviation” Controlling is seeing that actual performance is guided towards expected performance .All other functions of management cannot be completed effectively without performance of the control function. Dr. P. Dineshkumar / AP / AGE / KNCET 20

21. IMPORTANCE OF CONTROLLING Basis of future action. Facilitates decision making. Facilitates discipline and order. Facilitates Coordination. Facilitates motivation. Effective plan Implementation Dr. P. Dineshkumar / AP / AGE / KNCET 21

22. Dr. P. Dineshkumar / AP / AGE / KNCET 22

23. WHAT IS MEAN BY MANAGERS? Managers play critical roles across different business settings. Whether providing leadership for a department or an entire business, managers may be responsible for creating and implementing strategies, directly overseeing shift workers or ensuring projects are completed on time and within budgetary parameters. Dr. P. Dineshkumar / AP / AGE / KNCET 23

24. TYPES OF MANAGERS Dr. P. Dineshkumar / AP / AGE / KNCET 24

25. Top Managers  are responsible for the company in general, and the way it performs and an example is the president of the company. Middle Managers  are considered a lower level in comparison to top managers, they are either responsible for large departments or smaller divisions. The lowest level of management is  team leaders  or  supervisors,  which are individuals responsible for smaller groups of individuals. Dr. P. Dineshkumar / AP / AGE / KNCET 25

26. MANAGERIAL ROLES To meet the many demands of performing their functions, managers assumes multiple roles. A role is an organized set of behaviors. Henry Mintzberg has identified ten roles common to work of all managers The ten roles are divided into three groups: Interpersonal Role. Informational Role. Decisional Role. Dr. P. Dineshkumar / AP / AGE / KNCET 26

27. MANAGERIAL ROLES Dr. P. Dineshkumar / AP / AGE / KNCET 27

28. Interpersonal Role The interpersonal roles link all managerial work together. The three interpersonal roles are primarily concerned with interpersonal relationships. Figurehead Role: The manager represents the organization in all matters of formality. The top level manager represents the company legally and socially to those outside of the organization. The supervisor represents the workgroup to higher management and higher management to the workgroup Dr. P. Dineshkumar / AP / AGE / KNCET 28

29. Leader Role: The leader role defines the relationship between the manager and the employee . Liaison Role: In the liaison role, the manager interacts with peers and people outside the organization. The top-level manager uses the liaison role to gain favours and information, while the supervisor uses it to maintain the routine flow of work. Dr. P. Dineshkumar / AP / AGE / KNCET 29

30. Informational Role Monitor Role: I n the role of a monitor, the manager receives and collects information. The information collected, by scanning the environment, facilitates managerial decision-making function. Disseminator Role: In the role of a disseminator, the manager transmits special information into the organization. The top-level manager receives and transmits more information from people outside the organization than the supervisor . Spokesperson Role: T he manager disseminates the organization's information into its environment. Thus, the top level manager is seen as an industry expert, while the supervisor is seen as a unit or departmental expert Dr. P. Dineshkumar / AP / AGE / KNCET 30

31. Decisional Role Entrepreneur Role: The manager seeks and identifies opportunities to promote the needed change. He is also involved in the development and implementation of a change strategy. Disturbance Handler Role: T he manager deals with threats to the organization. This role equips the manager to take corrective actions needed to resolve important, unexpected disturbances. He must seek solutions to various unanticipated problems like a strike, accidents and so on. Dr. P. Dineshkumar / AP / AGE / KNCET 31

32. Resource Allocator Role: In the resource allocator role, the manager chooses as to where the organization will expend its efforts. This role deals with allocation of scarce resources to various requests. Specific activities include developing and monitoring budgets, forecasting future resource needs and handling problems in acquiring them . Negotiator Role: T he manager negotiates on behalf of the organization. The top-level manager makes the decisions about the organization as a whole, while the supervisor makes decisions about his or her particular work unit Dr. P. Dineshkumar / AP / AGE / KNCET 32

33. Managerial Skills Dr. P. Dineshkumar / AP / AGE / KNCET 33

34. Conceptual Skill Conceptual skills refer to the ability to visualize the entire picture of an organization’s environment i.e internal and external. It is the ability to analyze and diagnose complex situations or problems. This skill especially needs in the top level of management because this skill help the top-level managers to be properly identified, analyzed, diagnose, anticipated, and managed the situation which is helpful to make plans, policies, and strategies. Dr. P. Dineshkumar / AP / AGE / KNCET 34

35. Human Skill Human skills involve the ability to understand, lead, communicate, coordinate and control the behavior of other individuals and groups. As we know all the levels of human resources help to bring an organization into action. So, the manager needs knowledge and skills in the field such as communication, motivation, conflict management, etc. Therefore, every level of management requires the same level of human skills. Dr. P. Dineshkumar / AP / AGE / KNCET 35

36. Technical Skills Technical skills refer to the ability and knowledge in using the equipment, techniques, and procedures involved in specific tasks. The first-line supervisors need the technical skills the most because they have to see that goods and services are produced and delivered. Dr. P. Dineshkumar / AP / AGE / KNCET 36

37. Evolution of Management T heory Dr. P. Dineshkumar / AP / AGE / KNCET 37

38. Henry Fayol and Principles of Management Division of work or Specialization Authority and Responsibilty Discipline Unity of Command Unity of Direction Subordination of Individual Interest to Group Interest Remuneration Centralization and Decentralization Scalar chain Order Equity Stability of tenure Initiative Espirit De Corps Dr. P. Dineshkumar / AP / AGE / KNCET 38

39. Division of work Principles of specialization necessary for efficiency in utilizing labour . This principle states that there should be division of work amongst the persons. Division of work implies distribution of activities in a logical way so that each person performs his assigned work only. There should not be any duplication of work and for each work only one person is held liable or responsible for his performance. Dr. P. Dineshkumar / AP / AGE / KNCET 39

40. Authority & Responsibility Fayol defined it as the right to give orders and the power to exert obedience. With authority comes responsibility and accountability. Dr. P. Dineshkumar / AP / AGE / KNCET 40

41. Discipline Discipline is very important in order to smooth running of business. It means working in an orderly manner. It includes obedience to authority, following of instructions and orders. It also includes observance of the rules, regulations, procedures and methods. Further Fayol strongly recommended that, discipline requires good superior at all levels, clear and fair agreements and judicious application of penalties. Dr. P. Dineshkumar / AP / AGE / KNCET 41

42. Unity of Command This principle requires that, there should be one and one only superior for every individual employee. It means each employee should receive instructions about a particular work from one superior only. If an employee gets orders from two superiors at the same time the principles of unity of command is violated Dr. P. Dineshkumar / AP / AGE / KNCET 42

43. Unity of Direction It means there should be complete harmony between individual and organizational goals on the one hand and between departmental goals on the other hand. In other words, activities of a group are assigned to manager and manager is expected to look after all the activities of a particular group. So each group of activities with the same objective must have one head and one plan. Dr. P. Dineshkumar / AP / AGE / KNCET 43

44. Subordination of Individual Interest to Group Interest This principle expected the reconciliation of individual interest with group interest. Every organization has its own interests, which are called group interest. According to this principle employees must sacrifice their personal interests and work for the of the organization i.e., for group interest. Thus, an organization should employ only individuals who are fully committed to its objectives and are willing to readily comply with its mandates. Dr. P. Dineshkumar / AP / AGE / KNCET 44

45. Remuneration This principle advocates that remuneration to be paid to the workers should be fair, reasonable, satisfactory & rewarding of the efforts. The employees should get satisfaction out of their wages. Henry fayol also recommended other provisions for the benefits of employees such as free education, medical & residential facilities. He also strongly advocates that wages or salaries should be determined on the basis of the work done by the workers/employees, cost of living index Dr. P. Dineshkumar / AP / AGE / KNCET 45

46. Centralization and Decentralization It means all powers are vested with the top level authorities. In other words, centralization is a situation where all decisions are taken by top level management authorities. On the other hand, Decentralization means disposal of decision making authority to all the levels of the organization. Dr. P. Dineshkumar / AP / AGE / KNCET 46

47. Scalar Chain Scalar Chain means the hierarchy of authority from the highest executive to the lower one for the purpose of communication. It implies chain of superiors from the ultimate or top authority to the lower rank in the organization. It also states the relationship of superior-subordinate and the authority of superiors in relation to subordinate at all levels. Scalar chain refers to the route which the communications follow while flowing from one level to the ultimate authority Dr. P. Dineshkumar / AP / AGE / KNCET 47

48. Order Management follows a simple principle that right place for everything and for everyone. This is a principle relating to the arrangement of things and people. It is applied both material and men. In material order, there should be a place for everything and everything should be in its place. Dr. P. Dineshkumar / AP / AGE / KNCET 48

49. Equity Equity means quality of fair treatment. It implies just, fair and reasonable treatment. It means all the employees of the organization are treated equally by managers.This principle emphasizes kindness and justice in the behavior of managers towards workers. The application of equity requires goodness and experience in the part of managers. Besides, it requires loyalty and devotion from subordinates. Dr. P. Dineshkumar / AP / AGE / KNCET 49

50. Stability of Tenure The security of job is an essential one because if they have fear of insecurity of job, they cannot give more and better work and their morale will be low it will lead higher labour turnover. So job security must be provided by organization to each personnel. The development and growth of every organization depends solely on the sincerity of workers. Dr. P. Dineshkumar / AP / AGE / KNCET 50

51. Initiative Initiative means freedom to think out and execute a plan. Fayol emphasized that subordinates be given proper opportunity to take initiative while making and executing plans. According to Fayol , initiative is one of the keenest satisfactions for an intelligent man to experience so , he advices thee managers to give their employees sufficient scope to show their initiative Dr. P. Dineshkumar / AP / AGE / KNCET 51

52. Esprit De Corps (Union is Strength) The means union is strength or team spirit. According to this principle management should create team spirit among the employees. This principle states that both the workers and management should work together to accomplish the objectives. The reason behind this principle is that, team contribution is always better than individual contribution Harmony and unity among the staff are a great source of strength to the organization. All the employees of the organization are put together as a team in order to achieve the objective of the organization. Dr. P. Dineshkumar / AP / AGE / KNCET 52

53. F.W.TAYLOR & SCIENTIFIC MANAGEMENT Taylor suggested the following techniques of scientific management Functional foremanship. Work study Scientific task planning Scientific selection, placement and training of workers. Standardization and simplification Mental revolution Taylor’s differential piece rate system. Dr. P. Dineshkumar / AP / AGE / KNCET 53

54. FUNCTIONAL FOREMANSHIP F.W.Taylor felt that it was not possible to get in one man “the combination of brain, education, technical skill and other qualities necessary to handle all the requirements of an operating job . He advocated functional foremanship to supervise workers. According to this technique the task of supervision is divided into several specialized functions and each function is entrusted to a special foreman. Under this system eight persons are involved to direct the activities of the workers. Dr. P. Dineshkumar / AP / AGE / KNCET 54

55. WORK STUDY Work study refers to the systematic critical assessment of efficiency required to do the job. It varies from one job to another job. Work study eliminates wasteful and unnecessary operations, reduces effort and increases productivity. To determine fair days work the following studies are used. Time study Motion study Method study Fatigue study Dr. P. Dineshkumar / AP / AGE / KNCET 55

56. SCIENTIFIC TASK PLANNING It means allotment of work to each worker on the basis of the capacity of an average worker functioning in normal working conditions. It ensures quality of output. Routing: - It is concerned with the sequence of production operations. Scheduling: - It prescribes deadlines for each work. Dispatching:- It is concerned with issuing orders to carry out the work. Feedback:- It helps to check whether the work has been done as planned. Dr. P. Dineshkumar / AP / AGE / KNCET 56

57. SCIENTIFIC SELECTION, PLACEMENT AND TRAINING OF WORKERS Taylor emphasized the need for scientific selection and development of the worker. He said that the management should develop and train every worker to bring out his best faculties and to enable him to do a higher more interesting and more profitable class of work than he has done in the past. Dr. P. Dineshkumar / AP / AGE / KNCET 57

58. STANDARDIZATION & SIMPLIFICATION Standards are set up in respect of tools and equipment, period of work, working conditions, quality of raw material, use of standard instruments, standard raw materials, maintaining good working conditions and proper work periods with sufficient rest time will add production capacity of workers and management. Dr. P. Dineshkumar / AP / AGE / KNCET 58

59. MENTAL REVOLUTION Scientific management depends upon mutual cooperation between management and the workers. This calls for a fundamental change in thinking on the part of both management and workers. Dr. P. Dineshkumar / AP / AGE / KNCET 59

60. TAYLOR’S DIFFERENTIAL PIECE RATE SYSTEM Differential piece rate refers to a system in which efficient and inefficient workers are paid at different rates. According to Taylor, financial incentives acts as motivators and scope of extra earnings motivates the worker to put extra efforts. So Taylor developed the concept of ‘Differential piece rate system’. Incentive is directly linked with the productivity. Dr. P. Dineshkumar / AP / AGE / KNCET 60

61. MANAGING IN GLOBAL ENVIRONMENT Dr. P. Dineshkumar / AP / AGE / KNCET 61

62. SOCIAL RESPONSIBILITY Social responsibility is an ethical framework in which an individual is obligated to work and cooperate with other individuals and organizations for the benefit of the community that will inherit the world that individual leaves behind. Dr. P. Dineshkumar / AP / AGE / KNCET 62

63. Generally, corporate social responsibility initiatives are categorized as follows 1. Environmental responsibility Environmental responsibility initiatives aim to reduce pollution and greenhouse gas emissions and the sustainable use of natural resources. 2. Human rights responsibility Human rights responsibility initiatives involve providing fair labor practices (e.g., equal pay for equal work) and fair trade practices. Dr. P. Dineshkumar / AP / AGE / KNCET 63

64. 3. Philanthropic responsibility Philanthropic responsibility can include things such as funding educational programs, supporting health initiatives, donating to causes, and supporting community beautification projects. 4. Economic responsibility Economic responsibility initiatives involve improving the firm’s business operation while participating in sustainable practices – for example, using a new manufacturing process to minimize wastage. Dr. P. Dineshkumar / AP / AGE / KNCET 64

65. MANAGERIAL ETHICS Managerial ethics is a set of principles and rules dictated by upper management that define what is right and what is wrong in an organization. It is the guideline that helps direct a lower manager's decisions in the scope of his or her job when a conflict of values is presented. Dr. P. Dineshkumar / AP / AGE / KNCET 65

66. ORGANIZATION CULTURE “Organizational culture is a system of informal rules that spells out how people have to behave most of the time. It relatively a uniform perception held by the organization ”. The environment of any organization defines the culture, and is very crucial for the entities that make up the organization. Their behaviour , attitude and performance are directlyinfluenced by the culture although it varies from person to person. Dr. P. Dineshkumar / AP / AGE / KNCET 66

67. SOURCES OF ORGANIZATION CULTURE The personal and professional characteristics of people within the organization Organizational ethics The property rights that the organization gives to employees The structure of the organization. Dr. P. Dineshkumar / AP / AGE / KNCET 67

68. TYPES OF ORGANIZATION CULTURE Normative Culture Pragmatic Culture Academy Culture Baseball team Culture Club Culture Fortress Culture Tough Guy Culture Bet your company Culture Process Culture Dr. P. Dineshkumar / AP / AGE / KNCET 68

69. THANK YOU Dr. P. Dineshkumar / AP / AGE / KNCET 69