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UNIVERSITY INSTITUTE OF ENGINEERING

COMPUTER SCIENCE ENGINEERING
BACHELOR OF ENGINEERING
CS201
COMPUTER ENGINEERING
UCT-242
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PROGRAM EDUCATIONAL OBJECTIVES

PEO-1 Graduate will be able to serve professionally while engaging

with a Government firm, industry, corporate, academic and research
organization or by contributing being an entrepreneur.
PEO-2 Graduate will be able to work effectively in different fields with a
core knowledge of management.

PEO-3 Graduate will be able to develop themselves professionally by

lifelong learning through innovation and research while benefiting the
society.
PEO-4 Graduate will be able to show the leadership qualities in diverse
cultures, nationalities and fields while working with interdisciplinary teams.
PEO-5 Graduate will be committed team member through complacency and
ethical values.
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PROGRAM OUTCOME

1. Demonstrate the knowledge of management science to solve complex corporate problems using limited resources

2. Research literature and identify and analyze management research problems.

3. Identify business opportunities, design and implement innovations in work space.

4. Apply reasoning informed by the contextual knowledge to assess societal, health, safety, legal, and cultural issues and the
consequent responsibilities relevant to management practice.

5. Apply ethical principles and make ethical choices.

6. Function effectively as an individual, and as a member or leader in diverse teams, and in multidisciplinary settings.

7. Communicate effectively with all stakeholders of his role as a manager.

8. Engage in independent and life-long learning.

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CONTENTS

S.NO TOPIC PAGE NUMBER

1. Name of program 1

2. Name and code of subject 1

3. Program educational objectives 2

4. Program outcomes 3

5. Syllabus 5

6. Concept and introduction of management 6

7. Levels and nature of management 8

8. Characteristics of management 17

9. Principles of management 40
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SYLLABUS

Unit- 1
Introduction to Management: Nature of Management, Importance of Management, Concepts of Management, The history and
streams of management, the general and technical environment in management and the business strategy
Strategic Management: Introduction to strategic management: The strategies, process, vision, mission and goal setting. External and
Internal analysis.

Unit-2
Leadership Foundation And Theories: - Introduction to Leadership styles, Great Man theory, Trait theory, Behavioral Theory,
Contingency, Transformational and Transactional leadership theory,
Group Dynamics and Teams; Leadership in Complex group and Organization: Being in Communities, Renewing group organization
and communities, Understanding the change and strategies for change.
MBTI- Myers Brigg Type Indicator.

Unit-3

Organizing People, Project and Process: Leading Teams, Managing Human Resource Systems, Managing Individual and Diverse
Systems

Control: Function of control, Cycle of Control and Control in the process of organizing.
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INTRODUCTION TO MANAGEMENT AND LEADERSHIP

What is Management?

Management is a universal phenomenon. It is a very popular and widely used term. All organizations - business, political, cultural or
social are involved in management because it is the management which helps and directs the various efforts towards a definite
purpose. According to Harold Koontz, “Management is an art of getting things done through and with the people in formally
organized groups. It is an art of creating an environment in which people can perform and individuals and can co-operate towards
attainment of group goals”. According to F.W. Taylor, “Management is an art of knowing what to do, when to do and see that it is
done in the best and cheapest way”.

Management is a purposive activity. It is something that directs group efforts towards the attainment of certain pre - determined goals.
It is the process of working with and through others to effectively achieve the goals of the organization, by efficiently using limited
resources in the changing world. Of course, these goals may vary from one enterprise to another. E.g.: For one enterprise it may be
launching of new products by conducting market surveys and for other it may be profit maximization by minimizing cost.

Management involves creating an internal environment: - It is the management which puts into use the various factors of production.
Therefore, it is the responsibility of management to create such conditions which are conducive to maximum efforts so that people are
able to perform their task efficiently and effectively. It includes ensuring availability of raw materials, determination of wages and
salaries, formulation of rules & regulations etc.

Therefore, we can say that good management includes both being effective and efficient. Being effective means doing the appropriate
task i.e, fitting the square pegs in square holes and round pegs in round holes.Being efficient means doing the task correctly, at least
possible cost with minimum wastage of resources.

Management as a Process

As a process, management refers to a series of inter-related functions. It is the process by which management creates, operates and
directs purposive organization through systematic, coordinated and co-operated human efforts, according to George R. Terry,
“Management is a distinct process consisting of planning, organizing, actuating and controlling, performed to determine and
accomplish stated objective by the use of human beings and other resources”. As a process, management consists of three aspects:
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1. Management is a social process - Since human factor is most important among the other factors, therefore management is
concerned with developing relationship among people. It is the duty of management to make interaction between people -
productive and useful for obtaining organizational goals.
2. Management is an integrating process - Management undertakes the job of bringing together human physical and financial
resources so as to achieve organizational purpose. Therefore, is an important function to bring harmony between various
factors.
3. Management is a continuous process - It is a never ending process. It is concerned with constantly identifying the problem
and solving them by taking adequate steps. It is an on-going process.

Features of Management

Management is an activity concerned with guiding human and physical resources such that organizational goals can be achieved.
Nature of management can be highlighted as: -

1. Management is Goal-Oriented: The success of any management activity is assessed by its achievement of the predetermined
goals or objective. Management is a purposeful activity. It is a tool which helps use of human & physical resources to fulfill
the pre-determined goals. For example, the goal of an enterprise is maximum consumer satisfaction by producing quality
goods and at reasonable prices. This can be achieved by employing efficient persons and making better use of scarce resources.
2. Management integrates Human, Physical and Financial Resources: In an organization, human beings work with non-
human resources like machines. Materials, financial assets, buildings etc. Management integrates human efforts to those
resources. It brings harmony among the human, physical and financial resources.
3. Management is Continuous: Management is an ongoing process. It involves continuous handling of problems and issues. It is
concerned with identifying the problem and taking appropriate steps to solve it. E.g. the target of a company is maximum
production. For achieving this target various policies have to be framed but this is not the end. Marketing and Advertising is
also to be done. For this policies have to be again framed. Hence this is an ongoing process.
4. Management is all Pervasive: Management is required in all types of organizations whether it is political, social, cultural or
business because it helps and directs various efforts towards a definite purpose. Thus clubs, hospitals, political parties,
colleges, hospitals, business firms all require management. When ever more than one person is engaged in working for a
common goal, management is necessary. Whether it is a small business firm which may be engaged in trading or a large firm
like Tata Iron & Steel, management is required everywhere irrespective of size or type of activity.
5. Management is a Group Activity: Management is very much less concerned with individual’s efforts. It is more concerned
with groups. It involves the use of group effort to achieve predetermined goal of management of ABC & Co. is good refers to a
group of persons managing the enterprise.
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Levels of Management

The term “Levels of Management’ refers to a line of demarcation between various managerial positions in an organization. The
number of levels in management increases when the size of the business and work force increases and vice versa. The level of
management determines a chain of command, the amount of authority & status enjoyed by any managerial position. The levels of
management can be classified in three broad categories:

1. Top level / Administrative level

2. Middle level / Executory
3. Low level / Supervisory / Operative / First-line managers

Managers at all these levels perform different functions. The role of managers at all the three levels is discussed below:

LEVELS OF MANAGEMENT

1. Top Level of Management

It consists of board of directors, chief executive or managing director. The top management is the ultimate source of authority
and it manages goals and policies for an enterprise. It devotes more time on planning and coordinating functions.

The role of the top management can be summarized as follows -

a. Top management lays down the objectives and broad policies of the enterprise.
b. It issues necessary instructions for preparation of department budgets, procedures, schedules etc.
c. It prepares strategic plans & policies for the enterprise.
d. It appoints the executive for middle level i.e. departmental managers.
e. It controls & coordinates the activities of all the departments.
f. It is also responsible for maintaining a contact with the outside world.
g. It provides guidance and direction.
h. The top management is also responsible towards the shareholders for the performance of the enterprise.
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2. Middle Level of Management

The branch managers and departmental managers constitute middle level. They are responsible to the top management for the
functioning of their department. They devote more time to organizational and directional functions. In small organization,
there is only one layer of middle level of management but in big enterprises, there may be senior and junior middle level
management. Their role can be emphasized as -

a. They execute the plans of the organization in accordance with the policies and directives of the top management.
b. They make plans for the sub-units of the organization.
c. They participate in employment & training of lower level management.
d. They interpret and explain policies from top level management to lower level.
e. They are responsible for coordinating the activities within the division or department.
f. It also sends important reports and other important data to top level management.
g. They evaluate performance of junior managers.
h. They are also responsible for inspiring lower level managers towards better performance.
3.
Lower Level of Management

Lower level is also known as supervisory / operative level of management. It consists of supervisors, foreman, section officers,
superintendent etc. According to R.C. Davis, “Supervisory management refers to those executives whose work has to be
largely with personal oversight and direction of operative employees”. In other words, they are concerned with direction and
controlling function of management. Their activities include -

a. Assigning of jobs and tasks to various workers.

b. They guide and instruct workers for day to day activities.
c. They are responsible for the quality as well as quantity of production.
d. They are also entrusted with the responsibility of maintaining good relation in the organization.
e. They communicate workers problems, suggestions, and recommendatory appeals etc to the higher level and higher
level goals and objectives to the workers.
f. They help to solve the grievances of the workers.
g. They supervise & guide the sub-ordinates.
h. They are responsible for providing training to the workers.
i. They arrange necessary materials, machines, tools etc for getting the things done.
j. They prepare periodical reports about the performance of the workers.
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k. They ensure discipline in the enterprise.

l. They motivate workers.
m. They are the image builders of the enterprise because they are in direct contact with the workers.

Functions of Management

Management has been described as a social process involving responsibility for economical and effective planning & regulation of
operation of an enterprise in the fulfillment of given purposes. It is a dynamic process consisting of various elements and activities.
These activities are different from operative functions like marketing, finance, purchase etc. Rather these activities are common to
each and every manger irrespective of his level or status.

Different experts have classified functions of management. According to George & Jerry, “There are four fundamental functions of
management i.e. planning, organizing, actuating and controlling”.

According to Henry Fayol, “To manage is to forecast and plan, to organize, to command, & to control”. Whereas Luther Gullick has
given a keyword ’POSDCORB’ where P stands for Planning, O for Organizing, S for Staffing, D for Directing, Co for Co-ordination,
R for reporting & B for Budgeting. But the most widely accepted are functions of management given by KOONTZ and O’DONNEL
i.e. Planning, Organizing, Staffing, Directing and Controlling.

For theoretical purposes, it may be convenient to separate the function of management but practically these functions are overlapping
in nature i.e. they are highly inseparable. Each function blends into the other & each affects the performance of others.

1. Planning

It is the basic function of management. It deals with chalking out a future course of action & deciding in advance the most
appropriate course of actions for achievement of pre-determined goals. According to KOONTZ, “Planning is deciding in
advance - what to do, when to do & how to do. It bridges the gap from where we are & where we want to be”. A plan is a
future course of actions. It is an exercise in problem solving & decision making. Planning is determination of courses of action
to achieve desired goals. Thus, planning is a systematic thinking about ways & means for accomplishment of pre-determined
goals. Planning is necessary to ensure proper utilization of human & non-human resources. It is all pervasive, it is an
intellectual activity and it also helps in avoiding confusion, uncertainties, risks, wastages etc.

2. Organizing
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It is the process of bringing together physical, financial and human resources and developing productive relationship amongst
them for achievement of organizational goals. According to Henry Fayol, “To organize a business is to provide it with
everything useful or its functioning i.e. raw material, tools, capital and personnel’s”. To organize a business involves
determining & providing human and non-human resources to the organizational structure. Organizing as a process involves:

 Identification of activities.
 Classification of grouping of activities.
 Assignment of duties.
 Delegation of authority and creation of responsibility.
 Coordinating authority and responsibility relationships.
3. Staffing

It is the function of manning the organization structure and keeping it manned. Staffing has assumed greater importance in the
recent years due to advancement of technology, increase in size of business, complexity of human behavior etc. The main
purpose o staffing is to put right man on right job i.e. square pegs in square holes and round pegs in round holes. According to
Kootz&O’Donell, “Managerial function of staffing involves manning the organization structure through proper and effective
selection, appraisal & development of personnel to fill the roles designed un the structure”. Staffing involves:

 Manpower Planning (estimating man power in terms of searching, choose the person and giving the right place).
 Recruitment, Selection & Placement.
 Training & Development.
 Remuneration.
 Performance Appraisal.
 Promotions & Transfer.
4. Directing

It is that part of managerial function which actuates the organizational methods to work efficiently for achievement of
organizational purposes. It is considered life-spark of the enterprise which sets it in motion the action of people because
planning, organizing and staffing are the mere preparations for doing the work. Direction is that inert-personnel aspect of
management which deals directly with influencing, guiding, supervising, motivating sub-ordinate for the achievement of
organizational goals. Direction has following elements:

 Supervision
 Motivation
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 Leadership
 Communication

Supervision- implies overseeing the work of subordinates by their superiors. It is the act of watching & directing work &
workers.

Motivation- means inspiring, stimulating or encouraging the sub-ordinates with zeal to work. Positive, negative, monetary,
non-monetary incentives may be used for this purpose.

Leadership- may be defined as a process by which manager guides and influences the work of subordinates in desired
direction.

Communications- is the process of passing information, experience, opinion etc from one person to another. It is a bridge of
understanding.

5. Controlling

It implies measurement of accomplishment against the standards and correction of deviation if any to ensure achievement of
organizational goals. The purpose of controlling is to ensure that everything occurs in conformities with the standards. An
efficient system of control helps to predict deviations before they actually occur. According to Theo Haimann, “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”. According to Koontz &O’Donell “Controlling is the measurement & correction of performance
activities of subordinates in order to make sure that the enterprise objectives and plans desired to obtain them as being
accomplished”. Therefore controlling has following steps:

a. Establishment of standard performance.

b. Measurement of actual performance.
c. Comparison of actual performance with the standards and finding out deviation if any.
d. Corrective action.

Principles of Scientific Management

1. Development of Science for each part of men’s job (replacement of rule of thumb)
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a. This principle suggests that work assigned to any employee should be observed, analyzed with respect to each and
every element and part and time involved in it.
b. This means replacement of odd rule of thumb by the use of method of enquiry, investigation, data collection, analysis
and framing of rules.
c. Under scientific management, decisions are made on the basis of facts and by the application of scientific decisions.
2. Scientific Selection, Training & Development of Workers
a. There should be scientifically designed procedure for the selection of workers.
b. Physical, mental & other requirement should be specified for each and every job.
c. Workers should be selected & trained to make them fit for the job.
d. The management has to provide opportunities for development of workers having better capabilities.
e. According to Taylor efforts should be made to develop each employee to his greatest level and efficiency & prosperity.
3. Co-operation between Management & workers or Harmony not discord
a. Taylor believed in co-operation and not individualism.
b. It is only through co-operation that the goals of the enterprise can be achieved efficiently.
c. There should be no conflict between managers & workers.
d. Taylor believed that interest of employer & employees should be fully harmonized so as to secure mutually
understanding relations between them.
4. Division of Responsibility
a. This principle determines the concrete nature of roles to be played by different level of managers & workers.
b. The management should assume the responsibility of planning the work whereas workers should be concerned with
execution of task.
c. Thus planning is to be separated from execution.
5. Mental Revolution
a. The workers and managers should have a complete change of outlook towards their mutual relation and work effort.
b. It requires that management should create suitable working condition and solve all problems scientifically.
c. Similarly workers should attend their jobs with utmost attention, devotion and carefulness. They should not waste the
resources of enterprise.
d. Handsome remuneration should be provided to workers to boost up their moral.
e. It will create a sense of belongingness among worker.
f. They will be disciplined, loyal and sincere in fulfilling the task assigned to them.
g. There will be more production and economical growth at a faster rate.
6. Maximum Prosperity for Employer & Employees
a. The aim of scientific management is to see maximum prosperity for employer and employees.
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b. It is important only when there is opportunity for each worker to attain his highest efficiency.
c. Maximum output & optimum utilization of resources will bring higher profits for the employer & better wages for the
workers.
d. There should be maximum output in place of restricted output.
e. Both managers & workers should be paid handsomely.

Techniques of Scientific Management

1. Time Study
a. It is a technique which enables the manager to ascertain standard time taken for performing a specified job.
b. Every job or every part of it is studied in detail.
c. This technique is based on the study of an average worker having reasonable skill and ability.
d. Average worker is selected and assigned the job and then with the help of a stop watch, time is ascertained for
performing that particular job.
e. Taylor maintained that Fair day’s work should be determined through observations, experiment and analysis by
keeping in view an average worker.

Standard Time × Working Hours = Fair Day’s Work

f. Motion Study
a. In this study, movement of body and limbs required to perform a job are closely observed.
b. In other words, it refers to the study of movement of an operator on machine involved in a particular task.
c. The purpose of motion study is to eliminate useless motions and determine the bet way of doing the job.
d. By undertaking motion study an attempt is made to know whether some elements of a job can be eliminated
combined or their sequence can be changed to achieve necessary rhythm.
e. Motion study increases the efficiency and productivity of workers by cutting down all wasteful motions.
g. Functional Foremanship
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a. Taylor advocated functional foremanship for achieving ultimate specification.

b. This technique was developed to improve the quality of work as single supervisor may not be an expert in all
the aspects of the work.
c. Therefore workers are to be supervised by specialist foreman.
d. The scheme of functional foremanship is an extension of principle pf specialization at the supervisory level.
e. Taylor advocated appointment of 8 foramen, 4 at the planning level & other 4 at implementation level.
f. The names & function of these specialist foremen are: -
 Instruction card clerk concerned with tagging down of instructions according to which workers are
required to perform their job
 Time & cost clerk is concerned with setting a time table for doing a job & specifying the material and
labor cost involved in it.
 Route clerk determines the route through which raw materials has to be passed.
 Shop Disciplinarians are concerned with making rules and regulations to ensure discipline in the
organization.
 Gang boss makes the arrangement of workers, machines, tools, workers etc.
 Speed boss concerned with maintaining the speed and to remove delays in the production process.
 Repair boss concerned with maintenance of machine, tools and equipments.
 Inspector is concerned with maintaining the quality of product.
h. Standardization
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a. It implies the physical attitude of products should be such that it meets the requirements & needs of customers.
b. Taylor advocated that tools &equipments as well as working conditions should be standardized to achieve
standard output from workers.
c. Standardization is a means of achieving economics of production.
d. It seems to ensure -
 The line of product is restricted to predetermined type, form, design, size, weight, quality. Etc
 There is manufacture of identical parts and components.
 Quality & standards have been maintained.
 Standard of performance are established for workers at all levels.
i. Differential Piece Wage Plan
a. This tech of wage payment is based on efficiency of worker.
b. The efficient workers are paid more wages than inefficient one.
c. On the other hand, those workers who produce less than standard no. of pieces are paid wages at lower rate than
prevailing rate i.e. worker is penalized for his inefficiency.
d. This system is a source of incentive to workers who improving their efficiency in order to get more wages.
e. It also encourages inefficient workers to improve their performance and achieve their standards.
f. It leads to mass production which minimizes cost and maximizes profits.
j. Other Techniques
a. Various other techniques have been developed to create ordeal relationship between management and workers
and also to create better understanding on part of works.
b. Those includes use of instruction cards, strict rules & regulations, graphs, slides, charts etc, so as to increase
efficiency of workers.

Objectives of Management

The main objectives of management are:

1. Getting Maximum Results with Minimum Efforts - The main objective of management is to secure maximum outputs with
minimum efforts & resources. Management is basically concerned with thinking & utilizing human, material & financial
resources in such a manner that would result in best combination. This combination results in reduction of various costs.
2. Increasing the Efficiency of factors of Production - Through proper utilization of various factors of production, their
efficiency can be increased to a great extent which can be obtained by reducing spoilage, wastages and breakage of all kinds,
this in turn leads to saving of time, effort and money which is essential for the growth & prosperity of the enterprise.
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3. Maximum Prosperity for Employer & Employees - Management ensures smooth and coordinated functioning of the
enterprise. This in turn helps in providing maximum benefits to the employee in the shape of good working condition, suitable
wage system, incentive plans on the one hand and higher profits to the employer on the other hand.
4. Human betterment & Social Justice - Management serves as a tool for the upliftment as well as betterment of the society.
Through increased productivity & employment, management ensures better standards of living for the society. It provides
justice through its uniform policies.

Management as a Science

Science is a systematic body of knowledge pertaining to a specific field of study that contains general facts which explains a
phenomenon. It establishes cause and effect relationship between two or more variables and underlines the principles governing their
relationship. These principles are developed through scientific method of observation and verification through testing.

Science is characterized by following main features:

1. Universally acceptance principles - Scientific principles represents basic truth about a particular field of enquiry. These
principles may be applied in all situations, at all time & at all places. E.g. - law of gravitation which can be applied in all
countries irrespective of the time.

Management also contains some fundamental principles which can be applied universally like the Principle of Unity of
Command i.e. one man, one boss. This principle is applicable to all type of organization - business or non business.

2. Experimentation & Observation - Scientific principles are derived through scientific investigation & researching i.e. they are
based on logic. E.g. the principle that earth goes round the sun has been scientifically proved.

Management principles are also based on scientific enquiry & observation and not only on the opinion of Henry Fayol. They
have been developed through experiments & practical experiences of large no. of managers. E.g. it is observed that fair
remuneration to personal helps in creating a satisfied work force.

3. Cause & Effect Relationship - Principles of science lay down cause and effect relationship between various variables. E.g.
when metals are heated, they are expanded. The cause is heating & result is expansion.

The same is true for management, therefore it also establishes cause and effect relationship. E.g. lack of parity (balance)
between authority & responsibility will lead to ineffectiveness. If you know the cause i.e. lack of balance, the effect can be
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ascertained easily i.e. in effectiveness. Similarly if workers are given bonuses, fair wages they will work hard but when not
treated in fair and just manner, reduces productivity of organization.

4. Test of Validity & Predictability - Validity of scientific principles can be tested at any time or any number of times i.e. they
stand the test of time. Each time these tests will give same result. Moreover future events can be predicted with reasonable
accuracy by using scientific principles. E.g. H2 & O2 will always give H2O.

Principles of management can also be tested for validity. E.g. principle of unity of command can be tested by comparing two
persons - one having single boss and one having 2 bosses. The performance of 1st person will be better than 2nd.

It cannot be denied that management has a systematic body of knowledge but it is not as exact as that of other physical sciences like
biology, physics, and chemistry etc. The main reason for the inexactness of science of management is that it deals with human beings
and it is very difficult to predict their behavior accurately. Since it is a social process, therefore it falls in the area of social sciences. It
is a flexible science & that is why its theories and principles may produce different results at different times and therefore it is a
behavior science. Ernest Dale has called it as a Soft Science.

Management as an Art

Art implies application of knowledge & skill to trying about desired results. An art may be defined as personalized application of
general theoretical principles for achieving best possible results. Art has the following characters -

1. Practical Knowledge: Every art requires practical knowledge therefore learning of theory is not sufficient. It is very important
to know practical application of theoretical principles. E.g. to become a good painter, the person may not only be knowing
different colour and brushes but different designs, dimensions, situations etc to use them appropriately. A manager can never
be successful just by obtaining degree or diploma in management; he must have also know how to apply various principles in
real situations by functioning in capacity of manager.
2. Personal Skill: Although theoretical base may be same for every artist, but each one has his own style and approach towards
his job. That is why the level of success and quality of performance differs from one person to another. E.g. there are several
qualified painters but M.F. Hussain is recognized for his style. Similarly management as an art is also personalized. Every
manager has his own way of managing things based on his knowledge, experience and personality, that is why some managers
are known as good managers (like Aditya Birla, Rahul Bajaj) whereas others as bad.
3. Creativity: Every artist has an element of creativity in line. That is why he aims at producing something that has never existed
before which requires combination of intelligence & imagination. Management is also creative in nature like any other art. It
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combines human and non-human resources in useful way so as to achieve desired results. It tries to produce sweet music by
combining chords in an efficient manner.
4. Perfection through practice: Practice makes a man perfect. Every artist becomes more and more proficient through constant
practice. Similarly managers learn through an art of trial and error initially but application of management principles over the
years makes them perfect in the job of managing.
5. Goal-Oriented: Every art is result oriented as it seeks to achieve concrete results. In the same manner, management is also
directed towards accomplishment of pre-determined goals. Managers use various resources like men, money, material,
machinery & methods to promote growth of an organization.

Thus, we can say that management is an art therefore it requires application of certain principles rather it is an art of highest order
because it deals with moulding the attitude and behavior of people at work towards desired goals.

Management as both Science and Art

Management is both an art and a science. The above mentioned points clearly reveals that management combines features of both
science as well as art. It is considered as a science because it has an organized body of knowledge which contains certain universal
truth. It is called an art because managing requires certain skills which are personal possessions of managers. Science provides the
knowledge & art deals with the application of knowledge and skills.

A manager to be successful in his profession must acquire the knowledge of science & the art of applying it. Therefore management is
a judicious blend of science as well as an art because it proves the principles and the way these principles are applied is a matter of art.
Science teaches to ’know’ and art teaches to ’do’. E.g. a person cannot become a good singer unless he has knowledge about various
ragas & he also applies his personal skill in the art of singing. Same way it is not sufficient for manager to first know the principles but
he must also apply them in solving various managerial problems that is why, science and art are not mutually exclusive but they are
complementary to each other (like tea and biscuit, bread and butter etc.).

The old saying that “Manager are Born” has been rejected in favor of “Managers are Made”. It has been aptly remarked that
management is the oldest of art and youngest of science. To conclude, we can say that science is the root and art is the fruit.

Nature of Management
Universal process: Wherever there is human activity, there is management. Without efficient management, objectives of the company
can not be achieved.
Factor of production: Qualified and efficient managers are essential to utilization of labor and capital.
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Goal oriented: The most important goal of all management activity is to accomplish the objectives of an enterprise. The goals should
be realistic and attainable.
Supreme in thought and action: Managers set realizable objectives and then mastermind action on all fronts to accomplish them. For
this, they require full support form middle and lower levels of management.
Group activity: All human and physical resources should be efficiently coordinated to attain maximum levels of combined
productivity. Without coordination, no work would accomplish and there would be chaos and retention.
Dynamic function: Management should be equipped to face the changes in business environment brought about by economic, social,
political, technological or human factors. They must be adequate training so that can enable them to perform well even in critical
situations.

Social science: All individuals that a manager deals with, have different levels of sensitivity, understanding and dynamism.
Important organ of society: Society influences managerial action and managerial actions influence society. Its managers
responsibility that they should also contribute towards the society by organizing charity functions, sports competition, donation to
NGO’s etc.

System of authority: Well-defined lines of command, delegation of suitable authority and responsibility at all levels of decision-
making. This is necessary so that each individual should what is expected from him and to whom he need to report to.
Profession: Managers need to possess managerial knowledge and training, and have to conform to a recognized code of conduct and
remain conscious of their social and human obligations.

Process: The management process comprises a series of actions or operations conducted towards an end.

Definition of Management

It is the Management that provides planning, organization, and direction which are necessary for business operations.
In a more important sense, management is a vital function concerned with all aspects of the working of an enterprise.
Evaluation and nature of management
Definition
Management is concerned with direction and control over the various activities
and work for the attainment of the objectives laid by the administration
Executive function mainly convened with carrying out the policies laid by the
administration
ORIGIN
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Management –wide and comprehensive subject

developed since civilization
present state has been achieved gradually
Actual development in the past 100 years only
So, Management is what management does:
According to Peter F. Drucker, “Neither results nor do resources exist inside the business. Both exist outside”.

It is not enough to collect the physical equipment, materials, labour and capital to work a business organization. These should be

worked in coordinated manner, for achieving optimum results.

Management is the function of guiding, directing and unifying human efforts and activities for the accomplishment of given tasks.

Mainly, management is a task of planning, coordinating, motivating and controlling the efforts of others towards the specific

objective.

Management is essential at every stage of life and management is a function that has its place not merely in the world of business, but

in any situation, which involves the human effort and its use for achieving a definite goal.

In short, management is getting things done through others [i.e.] people. It is simply management of human resources. It is not simply

man-management.

But on the other hand, willingness to work has to be created, their (workers) co-operation obtained and goodwill sustained.

Management is a two-way traffic. An organization depends upon its employees as much as its employees depend upon it.
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In a music performance, the vocalist is the principal performer. He is followed by instrumentalists. There must be perfect co-

ordination and harmony among them. Then alone it can be a successful performance. The singer when accompanied by other

instrumentalists forms a group.

This group works in harmony and cohesion. There is perfect management. To give another illustration: there are ten workers. Another

man is there as supervisor. It is not simply man-power management and work extraction. There is something more. Each worker has to

do his work. He manages his part.

Then all the ten do the joint work as a group. Apart from these ten individual workers, there is an unseen body that has to be

judiciously managed. That is group. This is the eleventh factor, which the supervisor has to deal with.

Each individual may do his work well. But the group work alone delivers the goods. Here the supervisor has to play his part.

Leadership is required to manage men and a group.

[b] Management is a universal phenomenon

The very survival of human being down the ages has depended on his skill for managing the resources at his command. Management

is relevant even to the personal life of an individual.

A successful man in any walk of life knows how to manage his affairs [i.e.] he is capable of getting the utmost out of his time, money,

energy, and social connections.

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A student, a business man, a house wife and others know the art of management. But generally, management means utilization of

group effort. This effort is to accomplish for reaching certain goal.

[c] Any management consists of two kinds of environment – external and internal

The external environment consists of (i) consumers (ii) society and (iii) government.

The environment [i.e.] internal consists of the co-ordination among man, machine and work. With these, objectives have to be

achieved.

The management has to maintain a working relationship with the labour. The supply of raw materials, investments, etc. has to be

maintained.

Above all, there must be an integrating force of the employee’s efforts into company’s plans and programmes.

[d] Management as art and science

(i) Management is an art as well as a science

Any art is creative. Art involves know how or skills.

Art is accomplishment of some results. Management requires creative sense at every stage.
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Every art piece has the stamp of the personal touch of the artist. So also, every manager has his own way of getting things done.

A manager cannot solve a problem with his experience and intelligence only.

New approach is necessary to solve a problem especially in the affairs of any management.

Art is critical judgement, instinctive perception and inspiring imagination. Every human being is different. To get things done,

imaginative approach is necessary on the part of a manager.

(ii) Science is systematized knowledge, theories, laws, etc. Science is rational and practical approach.

Science requires proof to the point of mathematical precision.

Management has become a body of organized and systematized knowledge.

General principles govern the science of management. Management, as a science, has developed perfect techniques. So, management

is both an art and a science.

[e] Management as Profession

Management, recognized as a profession, has been introduced in the universities. In the modern way of life, thousands of employees

have to be managed.
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Not only personnel is involved in management, there is human psychology also.

The profession of management, like other professions, requires expert knowledge, training and practical experience.

The science of management has become multifaceted as it deals with men and machines, with creditors, customers, government,

labour unions, business problems, etc.

[f] A critical appraisal of Management

Management is the art of creating proper, congenial, harmonious and social environment for getting things done.

Management is a technique of removing hurdles and getting over difficulties with no delay and also, getting on smoothly with the

concerned people.

Management is not merely assembling machines and men.

It is not even personnel management. It is getting the co-operation and goodwill of the people concerned.

[g] Management and Administration

It is said that there is not exact difference between management and administration.

There is another school that asserts management is quite different from administration.
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The third school is of the opinion, that management includes administration.

[h] According to Horence and Tead, Administration is the process of thinking and Management is the process and agency of actual

operation

At higher levels, the management is more concerned with administration and less with management.

According to Brech, “Management is the generic term for the total process of executive control and he regards, administration as

that part of management which is connected with the installation and carrying out with the procedures by which the progress of

activities is regulated and checked against plans”.

MANAGEMENT—Importance

1. Maintains discipline

2. Distributes work

3. Co-ordination

4. Improves efficiencies

5. Suggest new Ideas and improvement

6. Storing and recording

7. Arranging payments and keep records

8. Marketing and publicity

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9. Importance to labour grievances and maintain good human relations for achieving the goals

Basis Management Administration

Management is an art of getting things done through others by directing It is concerned with formulation of broad

Meaningtheir efforts towards achievement of pre-determined goals. objectives, plans & policies.

Nature Management is an executing function. Administration is a decision-making function.

Administration decides what is to be done & when

Process Management decides who should as it & how should he do it. it is to be done.

Management is a doing function because managers get work done under Administration is a thinking function because plans

Functiontheir supervision. & policies are determined under it.

Skills Technical and Human skills Conceptual and Human skills

Level Middle & lower level function Top level function

Management Functions

Henry Fayol first real thinker of management philosophy has classified the functions as

1. Planning

2. Organizing

3. Commanding (directing)

4. Staffing
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5. Controlling

Planning:

Planning is deciding in advance - what to do, when to do & how to do. It bridges the gap from where we are & where we want to be”.

A plan is a future course of actions. It is an exercise in problem solving & decision making. Planning is determination of courses of

action to achieve desired goals.

Organizing

It is the process of bringing together physical, financial and human resources and developing productive relationship amongst them for

achievement of organizational goals.

 To organize a business involves determining & providing human and non-human resources to the organizational structure.

Organizing as a process involves:

 Identification of activities.

 Classification of grouping of activities.

 Assignment of duties.

 Delegation of authority and creation of responsibility.

 Coordinating authority and responsibility relationships

Staffing:
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The main purpose of staffing is to put right man on right job i.e. square pegs in square holes and round pegs in round holes.

According to Kootz&O’Donell, “Managerial function of staffing involves manning the organization structure through proper and

effective selection, appraisal & development of personnel to fill the roles designed on the structure”.

Directing

It is that part of managerial function which actuates the organizational methods to work efficiently for achievement of organizational

purposes.

It is considered life-spark of the enterprise which sets it in motion the action of people because planning, organizing and staffing are

the mere preparations for doing the work. Direction is that inert-personnel aspect of management which deals directly with

influencing, guiding, supervising, motivating sub-ordinate for the achievement of organizational goals.

Direction has following elements:

 Supervision

 Motivation

 Leadership

 Communication

Controlling
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Controlling is the measurement & correction of performance activities of subordinates in order to make sure that the enterprise

objectives and plans desired to obtain them as being accomplished”. Therefore controlling has following steps:

 Establishment of standard performance.

 Measurement of actual performance.

 Comparison of actual performance with the standards and finding out deviation if any.

 Corrective action

Functional areas

1. Production

2. Marketing

3. Finance

4. Personnel

Production

 Purchasing

 Materials management

 R&D

Marketing
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 Advertising

 Marketing research

 Sales management

Finance

 Financial accounting

 Management accounting

 Costing

 Investment management

 Taxation

Personnel

 Recruitment and selection

 Training and development

 Wage and salary administration

 Industrial relations

Various functions of management

1. Forecasting
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2. Planning

3. Organizing

4. Directing

5. Motivating

6. Coordinating

7. Controlling

8. Communication

9. Leadership

10. Decision making

Three levels of Management

Management ---Levels

1. Top level

2. Middle level

3. Lower level

Functions of Top level management

1. Overall management(goal, objectives)

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2. Overall operation

3. Overall relationship(internal and external with Govt., etc)

Functions of Middle level management

1. To execute the various functions

2. To operate and co ordinate

3. To develop and train

4. To inculcate feeling among employees

Functions of lower level (supervisory)

1. Related to work force

2. Takes decision from middle level

3. Guide the worker

4. Provide training to worker

5. Solve day to day problems

6. Maintain good HR

The term management has the following three classifications:

Top management
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Middle management

Lower management

1. Top Management

Formulation of policy, co-ordination and motivation of the personnel.

E.g. Managing Director, Secretaries, Finance Directors, etc.

1. Middle Management

Co-ordination and motivation, planning and control of activities.

E.g. Heads of Departments and Superintendents, Managers.

1. Lower Management

Supervision and expert decision on technologies of operation and day-to-day activities (including administrative procedures).E.g.

Foreman, First line Supervisors.

Responsibilities of Management
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(i) The responsibility of management is three fold. 1. The masters who have appointed them 2. Managers, who are managed by the

masters and 3.The society at large.

(ii) Manager a business, managing managers and managing workers and work. These are the elements of management.

(iii) Prof F. Drucker says, “It can justify its existence with its authority by the economic results it produces”.

The economic achievement alone satisfies the investors and the community.

Only a productive enterprise, alone is profitable. A productive enterprise involves human and material resources.

According to Drucker, “The main job of management is organization of the work so as to make it most suitable for human beings, and

organization of people so as to make them work most productively and effectively”.

The role of manager

A manager has to play many roles to perform his duties. A role is an organized study of behavior belonging to an individual, office or

position.

The manager is working link between the company and its environment. The manager [i.e] the chief executive works for his company

effectively by guiding it properly and makes the environment serve the company purposefully, profitable and smoothly.
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The environment consists of competitors, suppliers, government, financiers, customers, and others. In short, a manager has to manage

a complex situation every time.

The work of manager can be divided as follows. This is according to the research study of Henry Minitzberg.

(i) Work dealing with inter-personal relationships.

(ii) Work dealing with information transfer.

(iii) Work connected with decision making.

Thus the phases of manager’s role in the Administration are

1. Inter-personal

2. Informational and

3. Decisional.

Note: As the head of an organization, he has the Liaison role to maintain contacts with his counter parts and others in the community

concerned with his unit.

The manager maintain constant contact with his subordinates, motivates them and activates them. He communicates his instructions

and works with them to reach his desired objectives.

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The manager is a kind of nerve centre of organizational information. The manager negotiates with the suppliers, agents, and others.

A manager naturally occupies a central point in the system. A manager is an entrepreneur.

A manager is always prepared to meet any crisis.

The danger may be from within or from without. A manager has to manage his resources prudently and profitably. A manager has to

be a shrewd negotiator.

AUTHORITY AND RESPONSIBILITY

Authority means “right to act, decide and command”. The delegate will not be in a position to perform his task properly unless he is

given necessary powers (i.e. authority). Hence, whenever a task is assigned to person, he must be given sufficient powers to exercise

control to achieve the task.

Responsibility is the obligation of a subordinate for the performance of any job allotted by the superior. As explained earlier a superior

officer cannot perform all the activities himself and hence certain responsibilities and authorities are delegated to his assistants. Thus

the delegation is not a one-way process. Authority and responsibility both go hand in hand and unless a man is given necessary

authority to perform certain duties he cannot be held responsible.

DELEGATION OF AUTHORITY:
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It means giving some one permission to do certain things.

NATURE OF MANAGEMNT

Management is a multi-disciplinary in nature and is distinct activity. Management has been regarded as science and an art and a

profession. The true nature of management can be known only after studying these aspect of management. The following are the

salient nature of management:

1. Management is a science and an art

2. Management is universal

3. Management is goal oriented

4. Management is economic resource

5. Management is distinct process

6. Management is a group activity

7. Management is an intangible force

8. Management is a multi-disciplinary subject

9. Management is dynamic

10. Systems of authority

Schools of Management
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 Man with wonderful intelligence inherited by nature has evolved a fine system to manage men and matters.

 Down the ages, man has been managing his affairs in relation to the environment.

Management as a profession has developed over the ages; Managing work and workers is a necessity now.

The process of development of the science of management has its roots in the organization of ancient cities, war theatres, irrigation

system, maintenance of huge army, etc. in olden days.

The evolution of science of management can be classified under three heads:

 Management – a scientific approach

 Management – a functional approach and

 Management – a behavioral approach.

CONTRIBUTIONS OF TAYLOR TO MANAGEMENT:

FREDICK WINSLOW TAYLOR (1856-1915) has often been referred to as “father of scientific management” was the first to give a

face lift to management by applying scientific thoughts on it. His scientific management was an approach that emphasized the

scientific study of work methods in order to improve worker efficiency and higher productivity. His ideas included time and motion

studies. In 1911 he published “principles of scientific management” to prove that his principles could be successfully applied to any

organization
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TAYLOR’S FOUR PRINCIPLES OF SCIENTIFIC MANAGEMENT:

1. Scientifically study each part of a task and develop the best method for performing the task.

2. Scientifically select workers with skills and abilities that match each job and train them in the most results in a scientific tasks.

3. Ensure cooperation through incentives and provide the work environment that reinforces optimal work results in a scientific

manner

4. 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

Frederick Winslow Taylor (1856-1915) was the founder of the theory “The Scientific Management”.

According to this theory, workers do not put forth maximum work during the given period and their efficiency requires improvement.

Workers should be trained properly for doing their work efficiently.

Taylor advocated planning of the job, perfect understanding between workers and management; profit sharing, knowledge of

industrial work, etc.

Scientific approach, harmonious relationship, co-operation and co-ordination, maximum production or output, and the development of

man’s energy to maximum advantage.

These are the main elements of Taylor’s theory

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The system was perfected later on:

1. Work study

Work measurement, work improvement, etc.

1. Standardization of tools

2. Perfecting personnel management

3. Separation of functions (functional organization)

4. Introducing positive thinking and the study of workers’ psychology for improved production, introduction of scientific

methods for efficient management.

Taylor’s Theory has its own disadvantages

Scientific Management has its aim only on production. Marketing, finance and other functional areas are excluded from this theory.

Workers are treated with no human touch. Workers lose all initiative in this system.

The basic approach of this theory is only mechanical. The salient features of this system are work study, standardization,

establishment of Personnel Department, etc. These have been adopted by managements in their techniques of administration.

(ii) Management – a Functional Approach

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Henri fayol (1841-1925) was a French Industrialist. As a shrewd manager, he developed his theory of management. He enunciated

functions of management in his, “General and Industrial Management”.

1. Technical (those factors of production)

2. Commercial (this includes buying, selling, etc.)

3. Security (Protection of property and other materials)

4. Accounting (details and determination of financial position) and

5. Managerial (functions of planning, organizing, commanding, coordinating, controlling, etc.)

CONTRIBUTIONS OF FAYOL TO MANAGEMENT:

HENRY FAYOL (1841-1925) was a French engineer who developed a systematic method of management that he insisted could be

both taught and learned. Trained as a mining engineer he joined a coal and iron combine as an apprentice and rose to the top position

of managing director in 1888.

Fayol is best known for hid administrative management approach which stresses the functional aspects of the organization structure.

In his view business activities are composed of the following six activities:

1. Technical activities

 Production

 Manufacturing
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2. Commercial activities

 Buying

 Selling

 Exchanging

2. Financial activities

 Searching for capital and credit

 Optimum use of them

3. Security activities

 Protecting property and persons

4. Accounting activities

 Taking stocks

 Keeping balance sheets

 Tracking cost

1. Managerial activities

 Planning

 Organizing

 Commanding

 Coordinating
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 Controlling

FAYOLS GENERAL PRINCIPLES OF MANAGEMENT:

 Division of work

 Authority

 Discipline

 Unity of command

 Unity of direction

 Subordination of individual interest to general interest

 Remuneration

 Centralization

 Scalar chain

 Order

 Equity

 Stability of personnel tenure

 Initiative

 Esprit de corps
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1. For achieving certain success in any organization, Espirit de corps should prevail. Total loyalty among members of an

organization should be there.

2. Changes in staff should not be affected often. Stability and tenure of personnel should be there.

3. Initiative is an asset: those who have this spirit of initiative should get all encouragement.

4. Equality and Courtesy does make any unit active. Members deserve kind treatment. Their energy and action can be exploited

to the full only when the management tries to get their sympathy and devotion.

5. Justice and fair treatment should be the motto of the management in dealing with its subordinated.

6. Specialization and division of work help higher productivity.

7. Authority has to be exercised with restraint and responsibility be borne with greater faith and devotion.

8. Order and discipline is absolutely necessary for the smooth working of a company.

But, even a subordinate must have full freedom to approach the highest authority to ventilate his/her grievances.

Central authority should exercise its full authority: but with discretion having in mind the needs of the situation.

1. A fair, just and working formula must be adhered to regarding the payments, salaries etc.

2. The spirit of give and take, harmony in relationship with each other, goodwill and co-operative attitude are the essential

characteristics of an administration.

3. Command: the Central authority alone should issue orders and orders to be received only from one authority.

4. Authority implies responsibility. When exercising authority, one should be cautious of one’s responsibility also.
 46

5. The top level management is a policy making body. (a) Forecasting and planning (b) Organizing (c) Issue of orders for

carrying on administration (d) Co-ordination and control and (e) Maintaining strict discipline with human approach and

sympathy.

(iii) Management – a behavioral approach

This aspect relates to human behavior and relationship. The behavioral science approach concerns the application of the methods and

findings of human psychology, social psychology and sociology for the understanding of organizational behavior.

This behavioral science was perfected by many experiments conducted by a team of researchers during 1920s and 1930s at the

Hawthorne plant of the Western Electric Company.

The purpose is to study the human behavior and relationship for improving the work attitude, the objective being to develop higher

levels of productivity and satisfaction.

Elton Mayo, is the specialist in this field of science. It is to be understood, that an organization is not an assembly of men and

machine.

It must have human touch in it. The study of human behavior is essential to manage an organization. A management involves social

system. Human psychology and other behavioral sciences have to be applied for effective management of an organization.

The main characteristics of behavioral sciences are:

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 Employees have to be motivated properly.

 Organization involves social system.

A study of human behavior is absolutely necessary for smooth working of an organization.

Group psychology is quite different from an individual psychology. Mob psychology is not group psychology. A group functions as

one unit in an organization.

Leadership requires enormous patience, intelligence, tact, study of managerial behaviors etc.

Contact and communication between employees and employers should be continuous, smooth and effective.

Skills of the employees and those of managers have to be improved for effective functioning of the organization.

Note: Mary Parker Follect (1868-1933) was another psychologist, interested in group psychology.

She emphasized the importance of human emotions, feelings, etc. in managing an organization.

First, a group is different from an individual.

A group, can be used as an instrument for achieving an objective in an orderly manner.

Secondly, authority has to be exercised with respect for human dignity.

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Men at the top, should know that they are dealing with human beings. Employers and employees are human beings. Personal approach

with sympathy and honour is essential in dealing with human beings.

Thirdly, conflicts among men, in an organization have to be resolved through negotiations with an attitude of give and take. Spirit of

compromise should prevail.

For a stable solution, integration of desires of both sides has to aim at nation by management has to be avoided at all costs.

Fourthly, an organization is a unit. It should function as a single integrated unit.

Fifthly, dominating attitudes and aggressive pastures have to be given up by the management.

A management takes decisions on policy matters, and has the responsibility to implement its policies at every stage. The management

is both part of an organization and not part of the organization at the same time. When the organization functions, management

becomes a part of the organization.

When the management takes decision, it does so as if it is not a part of the organization. But always its aim should be to get the best

out of everyone and everything.

It is said of Gandhiji, that he had the intrinsic capacity to make man out of clay. Every management should have this trait to get the

best out of an organization.

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ORGANISATION

An organisation is a “process of clearly demarcating the authority, responsibility and coordination to achieve the objectives of the

concern and duties of each individual and providing the channels of communication”.

Every business needs to be organised for better performance. For a business there are three essential requirements, such

Man

Material and

Machinery.

“Organisation is the coordination of man, machinery and material in such a way that maximum output at ease and efficiency under

total minimum cost is assured”.

Organisation structure is the network of relationship between the various positions of persons in an organisation”. It deals with the

overall organisational arrangements in an enterprise.

ADMINISTRATION

“It is that function of an enterprise which determines the overall policies and objectives”, it decides the general purpose of an

enterprise and frames the major policies. This all is done by the board of directors
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Administration-types:

1. Centralized

2. Decentralized

Dr.W R Spriegel has distinguished the three words administration, management, and organisation as below:

“Administration pre determines the specific goals and lays down the broad areas within which these goals are to be attained. Thus

administration is a determinative function. While the management is an executive function, which is mainly concerned with

carrying out the broad policies laid down by the administration. Organisation is the machinery through which the coordination is

established between administration and management”. Thus we may conclude in simple words that:

“Administration chalks out the general policies while management works for bringing these policies into effect. Organisation is the

mechanism which helps the management in bringing the policies into effect laid by the administration.

Duties and responsibilities of management:

1. To maintain discipline and to keep control over the employees of various departments.

2. To distribute work and machines among the workers in such a way as to secure maximum output.

3. To keep coordination among the staff at various levels.

4. To improve efficiency , management keeps sufficient watch and strict inspection

5. To suggest new ideas and improvements

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6. To arrange for the efficient storing and recording

7. To make the arrangement of payments and their records

Basis Management Administration

It is applicable to business concerns i.e. profit-makingIt is applicable to non-business concerns i.e. clubs, schools,

Applicabilityorganization. hospitals etc.

The management decisions are influenced by the values, The administration is influenced by public opinion, govt.

Influence opinions, beliefs & decisions of the managers. policies, religious organizations, customs etc.

Management constitutes the employees of the organizationAdministration represents owners of the enterprise who earn

who are paid remuneration (in the form of salaries & return on their capital invested & profits in the form of

Status wages). dividend.

Nature of Management

Universal process: Wherever there is human activity, there is management. Without efficient management, objectives of the company
can not be achieved.
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Factor of production: Qualified and efficient managers are essential to utilization of labor and capital.

Goal oriented: The most important goal of all management activity is to accomplish the objectives of an enterprise. The goals should
be realistic and attainable.

Supreme in thought and action: Managers set realizable objectives and then mastermind action on all fronts to accomplish them. For
this, they require full support form middle and lower levels of management.

Group activity: All human and physical resources should be efficiently coordinated to attain maximum levels of combined
productivity. Without coordination, no work would accomplish and there would be chaos and retention.

Dynamic function: Management should be equipped to face the changes in business environment brought about by economic, social,
political, technological or human factors. They must be adequate training so that can enable them to perform well even in critical
situations.

Social science: All individuals that a manager deals with, have different levels of sensitivity, understanding and dynamism.

Important organ of society: Society influences managerial action and managerial actions influence society. Its managers
responsibility that they should also contribute towards the society by organizing charity functions, sports competition, donation to
NGO’s etc.
 53

System of authority: Well-defined lines of command, delegation of suitable authority and responsibility at all levels of decision-
making. This is necessary so that each individual should what is expected from him and to whom he need to report to.

Profession: Managers need to possess managerial knowledge and training, and have to conform to a recognized code of conduct and
remain conscious of their social and human obligations.

Process: The management process comprises a series of actions or operations conducted towards an end.

Scope of Management

Although it is difficult to precisely define the scope of management, yet the following areas are included in it:

1. Subject-matter of management: Planning, organizing, directing, coordinating and controlling are the activities included in
the subject matter of management.

2. Functional areas of management: These include:

Financial management includes accounting, budgetary control, quality control, financial planning and managing the overall finances
of an organization.
 54

Personnel management includes recruitment, training, transfer promotion, demotion, retirement, termination, labor-welfare and
social security industrial relations.

Purchasing management includes inviting tenders for raw materials, placing orders, entering into contracts and materials control.

Production management includes production planning, production control techniques, quality control and inspection and time and
motion studies.

Maintenance management involves proper care and maintenance of the buildings, plant and machinery.

Transport management includes packing, warehousing and transportation by rail, road and air.

Distribution management includes marketing, market research, price-determination, taking market risk and
advertising, publicity and sales promotion.

Office Management includes activities to properly manage the layout, staffing and equipment of the office.

Development management involves experimentation and research of production techniques, markets, etc.

3. Management is an inter-disciplinary approach: For the correct implementation of the management, it is important to have
knowledge of commerce, economics, sociology, psychology and mathematics.
 55

4. Universal application: The principles of management can be applied to all types of organizations irrespective of the nature of tasks
that they perform.

5. Essentials of management: Three essentials of management are:

 Scientific method
 Human relations
 Quantitative technique

6. Modern management is an agent of change: The management techniques can be modified by proper research and development to
improve the performance of an organization.

Importance Of Management

1. It helps in Achieving Group Goals - It arranges the factors of production, assembles and organizes the resources, integrates
the resources in effective manner to achieve goals. It directs group efforts towards achievement of pre-determined goals. By
defining objective of organization clearly there would be no wastage of time, money and effort. Management converts
disorganized resources of men, machines, money etc. into useful enterprise. These resources are coordinated, directed and
controlled in such a manner that enterprise work towards attainment of goals.
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2. Optimum Utilization of Resources - Management utilizes all the physical & human resources productively. This leads to
efficacy in management. Management provides maximum utilization of scarce resources by selecting its best possible alternate
use in industry from out of various uses. It makes use of experts, professional and these services leads to use of their skills,
knowledge, and proper utilization and avoids wastage. If employees and machines are producing its maximum there is no
under employment of any resources.

3. Reduces Costs - It gets maximum results through minimum input by proper planning and by using minimum input & getting
maximum output. Management uses physical, human and financial resources in such a manner which results in best
combination. This helps in cost reduction.

4. Establishes Sound Organization - No overlapping of efforts (smooth and coordinated functions). To establish sound
organizational structure is one of the objective of management which is in tune with objective of organization and for
fulfillment of this, it establishes effective authority & responsibility relationship i.e. who is accountable to whom, who can give
instructions to whom, who are superiors & who are subordinates. Management fills up various positions with right persons,
having right skills, training and qualification. All jobs should be cleared to everyone.
5. Establishes Equilibrium - It enables the organization to survive in changing environment. It keeps in touch with the changing
environment. With the change is external environment, the initial co-ordination of organization must be changed. So it adapts
organization to changing demand of market / changing needs of societies. It is responsible for growth and survival of
organization.
6. Essentials for Prosperity of Society - Efficient management leads to better economical production which helps in turn to
increase the welfare of people. Good management makes a difficult task easier by avoiding wastage of scarce resource. It
improves standard of living. It increases the profit which is beneficial to business and society will get maximum output at
minimum cost by creating employment opportunities which generate income in hands. Organization comes with new products
and researches beneficial for society.

Concepts of management
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Management: Definitions, Concept, Objectives and Scope!

The term ‘management’ has been used in different senses. Sometimes it refers to the process of planning, organizing, staffing,

directing, coordinating and controlling, at other times it is used to describe it as a function of managing people. It is also referred to as

a body of knowledge, a practice and discipline. There are some who describe management as a technique of leadership and decision-

making while some others have analyzed management as an economic resource, a factor of production or a system of authority.

Definitions:

Various definitions of management are discussed as follows:

(A) Art of Getting Things Done:
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Mary Parker Follett:

“Management is the art of getting things done through others.” Follett describes management as an art of directing the activities of

other persons for reaching enterprise goals. It also suggests that a manager carries only a directing function.

Harold Koontz:
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“Management is the art of getting things done through and with people in formally organized groups.” Koontz has emphasized that

management is getting the work done with the co-operation of people working in the organization.

J.D. Mooney and A.C. Railey:

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“Management is the art of directing and inspiring people.” Management not only directs but motivates people in the organization for

getting their best for obtaining objectives.

As per the above mentioned definitions, management is the art of getting things done through people who may be managers or non-

managers. At the level of chief executive, the work is got done through functional managers, at middle level the things are

implemented through supervisors and at lower level of management through workers. Human and technical skills play an important

role for getting things done. These definitions represent the traditional view point of management while workers are treated as a factor

of production only. They are paid wages for doing their work.

This view point suffers from the following deficiencies:

(i) This concept does not specify what type of functions is required to be performed for getting things done from others.

(ii) Management is treated as an art. These days management has also acquired the status of science.

(iii) The workers are treated as means of getting results. The needs and aspirations of workers are not taken into account.

Management is much more than just getting the things done through others. Management may be a technique for getting things done

through others by satisfying their needs and helping them grow. Harold Koontz emphasized the attainment of business goals with the

co-operation of people working in the organization.

(B) Management as a Process:

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Some authors view management as a process because it involves a number of functions. Management refers to all Involves different a

manager does. Various functions which are performed by managers to make the efficient use of the available material and human

resources so as to achieve the desired objectives are summed up as management. Thus, the functions of planning, organizing, staffing,

directing, co-coordinating and controlling fall under the process of management.

Henry Fayol:
“To manage is to forecast and plan, to organize, to command, to co-ordinate, and to control.” Fayol described management as a

process of five functions such as planning, organizing, commanding, coordinating and controlling. Modern authors, however, do not

view co-ordination as a separate function of management.

George R. Terry:
“Management is a distinct process consisting of activities of planning, organizing, actuating and controlling, performed to determine

and accomplish stated objectives with the use of human beings and other resources.” Though Terry has described four functions to be

a part of management process but managerial functions are classified into five categories.

James L. Lundy:
“Management is principally the task of planning, coordinating, motivating and controlling the efforts of others towards a specific

objective.” Lundy has also specified some functions which management has to perform for achieving organizational goals.

Louis Allen:
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“Management is what a manager does.” This is a broad definition linking all the activities of the manager to the concept of

management. Whatever work is undertaken by a manager forms a part of management. Above definitions associate management with

the functions undertaken for running a business. There may be a difference as to what functions are required to be taken up by the

management but functions such as planning, organizing, staffing, directing and controlling form the process of management.

These functions are continuously taken up. On the completion of last function, the first function starts again. The functions of

management are interdependent and interlinked. In order to achieve the objectives, a manager has to perform various functions

simultaneously.

(C) Management as a Discipline:

Sometimes the term ‘management’ is used to connote neither the activity nor the personnel who performs it, but as a body of

knowledge, a practice and a discipline. In this sense, management refers to the principles and practices of management as a subject of

study. Management is taught as a specialized branch of knowledge in educational institutions. It has drawn heavily from Psychology,

Sociology, and Anthropology etc. A person acquiring degree or diploma in management can try for a managerial job.

Management is treated both as an art as well as science. An art is often regarded as the systematic application of skill or knowledge in

effecting accomplishment of results. In management one has to use personal skill and knowledge in solving many complicated

problems to achieve enterprise objectives. Management is regarded as a science because it has developed certain principles,

generalizations and techniques which have more or less universal application. So management is a study of a specific discipline. When

one says that a particular person is in management stream then it is assumed that he is studying a particular field of learning.
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(D) Art and Science of Decision-Making and Leadership:

Decision-making and guiding others is considered an important element of management. A manager has to take various decisions

every day for properly running an enterprise.

Donald J. Clough:
“Management is the art and science of decision-making and leadership.” The author views management as an art and science of

decision-making. The quality of decisions determines the performance of a manager. He has also to provide leadership to subordinates

for motivating them to undertake their work.

Rose Moore:
“Management means decision-making.” Decision-making cannot be the only function of management even though it is very

important.

Stanley Vance:
“Management is simply the process of decision-making and control over the action of human beings for the express purpose of

attaining predetermined goals.” Stanley Vance has emphasized decision-making and control over the actions of employees for

reaching the enterprise goals.

Association of Mechanical Engineers, U.S.A.: “Management is the art and science of preparing, organizing and directing human

efforts applied to control the forces and utilize the materials of nature for the benefit of man.” The association has given a wide

definition where it has emphasized that management controls and directs human efforts for utilizing natural resources for the benefit
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of man. The above mentioned definitions describe management as a science and art of decision making and controlling the activities

of employees for obtaining enterprise objectives.

(E) An Art of Increasing Productivity:

Some authors are of the view that the science of management is used to increase productivity of the enterprise.

John F. Mee:
“Management may be defined as the art of securing maximum prosperity with a minimum of effort so as to secure maximum

prosperity and happiness for both employees and employer and give public the best possible service.”

F.W. Taylor:
“Management is the art of knowing what you want to do in the best and cheapest way.”

Management is the art of securing maximum productivity at the minimum of cost so that it helps employers, employees and public in

general. Public is also a stake holder in business, it should also benefit from good performance of business.

(F) Integration of Efforts:

Management makes use of human and physical resources for the benefit of the enterprise.

Keith and Gubellini:

“Management is the force that factors integrates men and physical plant into an effective operating unit.” Management integrates

physical and human resources for operating the manufacturing process in a better way.
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Barry M. Richman:
“Management entails the coordination of human and material resources towards the achievement of organizational objectives as well

as the organization of the productive functions essential for achieving stated or accepted economic goals.” Management alms to co-

ordinate and integrate various resources in the organization for achieving enterprise objectives. The thrust of above mentioned

definitions is that integration and co-ordination of various factors of production is essential for running a business properly and this

function is undertaken by management.

(G) Management as a Group of Managers:
The term management is frequently used to denote a Refers to managerial group of managerial personnel. When one says that

personnel management of such and such company is efficient, he refers to the group of persons who are looking after the working of

the enterprise. These persons individually are called managers. “Management is the body or group of people which performs certain

managerial functions for the accomplishment of pre-determined goals.”

All managers perform managerial functions of planning, organizing, staffing, directing and controlling. These persons collectively arc

called ‘body of managerial personnel.’ In actual practice the term ‘management’ is used to denote top management of the

organization. Top management is mainly concerned with determination of objectives, strategic planning, policy formulation and

overall control of the organization.

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Concept of Management:

Objectives of Management:
The primary objective of management is to run the enterprise smoothly. The profit earning objective of a business is also to be kept in

mind while undertaking various functions.

Following are the broad objectives of management:

1. Proper Utilization of Resources:
The main objective of management is to use various resources of the enterprise in a most economic way. The proper use of men,

materials, machines and money will help a business to earn sufficient profits to satisfy various interests. The proprietors will want

more returns on their investments while employees, customers and public will expect a fair deal from the management. All these

interests will be satisfied only when physical resources of the business are properly utilized.
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2. Improving Performance:
Management should aim at improving the performance of each and every factor of production. The environment should be so

congenial that workers are able to give their maximum to the enterprise. The fixing of objectives of various factors of production will

help them in improving their performance.

3. Mobilizing Best Talent:

The management should try to employ persons in various fields so that better results are possible. The employment of specialists in

various fields will be increasing the efficiency of various factors of production. There should be a proper environment which should

encourage good persons to join the enterprise. The better pay scales, proper amenities, future growth potentialities will attract more

people in joining a concern.

4. Planning for Future:

Another important objective of management is to prepare plans. No management should feel satisfied with today’s work if it has not

thought of tomorrow. Future plans should take into consideration what is to be done next. Future performance will depend upon

present planning. So, planning for future is essential to help the concern.

Scope or Branches of Management:

Management is an all pervasive function since it is required in all types of organized endeavour. Thus, its scope is very large.

The following activities are covered under the scope of management:

(i) Planning,
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(ii) Organization

(iii) Staffing.

(iv) Directing,

(v) Coordinating, and

(vi) Controlling.

The operational aspects of business management, called the branches of management, are as follows:
1. Production Management

2. Marketing Management

3. Financial Management.

4. Personnel Management and

5. Office Management.
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1. Production Management:
Production means creation of utilities. This creation of utilities takes place when raw materials are converted into finished products.

Production management, then, is that branch of management ‘which by scientific planning and regulation sets into motion that part of

enterprise to which has been entrusted the task of actual translation of raw material into finished product.’

It is a very important field of management ,’for every production activity which has not been hammered on the anvil of effective

planning and regulation will not reach the goal, it will not meet the customers and ultimately will force a business enterprise to close

its doors of activities which will give birth to so many social evils’.

Plant location and layout, production policy, type of production, plant facilities, material handling, production planning and control,

repair and maintenance, research and development, simplification and standardization, quality control and value analysis, etc., are the

main problems involved in production management.

2. Marketing Management:
Marketing is a sum total of physical activities which are involved in the transfer of goods and services and which provide for their

physical distribution. Marketing management refers to the planning, organizing, directing and controlling the activities of the persons

working in the market division of a business enterprise with the aim of achieving the organization objectives.

It can be regarded as a process of identifying and assessing the consumer needs with a view to first converting them into products or

services and then involving the same to the final consumer or user so as to satisfy their wants with a stress on profitabilit y that ensures
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the optimum use of the resources available to the enterprise. Market analysis, marketing policy, brand name, pricing, channels of

distribution, sales promotion, sale-mix, after sales service, market research, etc. are the problems of marketing management.

3. Financial Management:
Finance is viewed as one of the most important factors in every enterprise. Financial management is concerned with the managerial

activities pertaining to the procurement and utilization of funds or finance for business purposes.

The main functions of financial management include:

(i) Estimation of capital requirements;

(ii) Ensuring a fair return to investors;

(iii) Determining the suitable sources of funds;

(iv) Laying down the optimum and suitable capital

Structure for the enterprise:

(i) Co-coordinating the operations of various departments;

(ii) Preparation, analysis and interpretation of financial statements;

(iii) Laying down a proper dividend policy; and

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(iv) Negotiating for outside financing.

4. Personnel Management:
Personnel Management is that phase of management which deals with the effective control and use of manpower. Effective

management of human resources is one of the most crucial factors associated with the success of an enterprise. Personnel management

is concerned with managerial and operative functions.

Managerial functions of personnel management include:

(i) Personnel planning;

(ii) Organizing by setting up the structure of relationship among jobs, personnel and physical factors to contribute towards

organization goals;

(iii) Directing the employees; and

(iv) Controlling.

The operating functions of personnel management are:

(i) Procurement of right kind and number of persons;

(ii) Training and development of employees;

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(iii) Determination of adequate and equitable compensation of employees;

(iv) Integration of the interests of the personnel with that of the enterprise; and

(v) Providing good working conditions and welfare services to the employees.

5. Office Management:
The concept of management when applied to office is called ‘office management’. Office management is the technique of planning,

coordinating and controlling office activities with a view to achieve common business objectives. One of the functions of management

is to organize the office work in such a way that it helps the management in attaining its goals. It works as a service department for

other departments.

The success of a business depends upon the efficiency of its administration. The efficiency of the administration depends upon the

information supplied to it by the office. The volume of paper work in office has increased manifold in these days due to industrial

revolution, population explosion, increased interference by government and complexities of taxation and other laws.

Harry H. Wylie defines office management as “the manipulation and control of men, methods, machines and material to achieve the

best possible results—results of the highest possible quality with the expenditure of least possible effect and expense, in the shortest

practicable time, and in a manner acceptable to the top management.”

TECHNOLOGICAL ENVIRONMENT IMPACT IN BUSINESS STRATEGY

Technology
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It can come as an important tool within the company, improving the operations and functions or it can be the very reason why a
company exists. Such is the scale of impact of technology on business. Heads of companies are on constant lookout for updates and
developments in the technological environment. This helps them not just to improve the efficiency of the way the organization works
but to be aware of the transformational phase and come up with groundbreaking strategies to drive growth. Management students
during their academic course are thought how technological environment can influence business environment. This write-up tries to
provide few instances and helps readers realize how technology constantly transforms businesses.

New Technology – New Products – New Business

During the 1990s, the world of photography started to see a shift from film photography to digital photography. Three big names in
the field of film photography then were Fujifilm, Konica and Kodak. The change in technology affected these businesses greatly.
Experts state that Fujifilm was more successful in adapting to the new digital technology and today it manufactures digital cameras
and lenses. Though Kodak manufactured digital cameras during the 90s and 2000s it did not see great success and now it has joined
hands with Flexitronics to stay in the domain. Konica on the other-hand got merged to Minolta in 2003. Today, the company is into
manufacturing printers and copiers. This is a wonderful example of how technology can impact the very existence of the business.

Technology Transforming Operations

The introduction of new technology has constantly changed the way a company functions. The developments in IT has taken over
almost all departments of an organization. Today, information is mostly stored in servers as opposed to decades-old method of storing
in hard copies (files and registers). Thanks to the advancement in the internet, companies use digital marketing strategies to market
and sell their products today. Even the research and design department of organization are subject to constant developments in
technology. For instance, companies like Boeing and Siemens are investing hugely on adapting 3D printing technique for designing
their products. The companies believe this can quicken the design process, reduce cost and improve effectiveness of designing.

Technology Helps Develop Business Strategies

The transformation in the way how data is collected, recorded, retrieved and utilized has helped companies come up with
groundbreaking business strategies. Today, companies monitor customer taste and trends using data that is available. The development
in information technology has made it possible for businesses to study customer behavior and develop strategies accordingly.
Technology has not only made it possible to collect and store data but organizations are able to analyze the available data to come up
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with meaningful conclusions and make informed decisions. With more and more customer focus, data analytics will play a key ro le in
growth strategies of companies.

Experts and researchers who have worked extensively trying to know the nature and extent of impact technology can have over
business state that technology has disrupted business models and changed the fundamental principles. Gone are those days where
companies could stick to decades old model and they have their share of customers in the market. Today, companies are working
towards aligning themselves with the new-age technology. While some organizations have been successful in leveraging on
technological development to grow in the market, to some businesses it has been challenging to adapt to the changes. Technology and
globalization has made its impact on business of all scales. Management professionals have come out of the traditional path of using
logical methods for planning and are on continuous look out for new ways to help align themselves with the market changes and get
the best for their business.

The Elements of the General Environment: PESTEL Analysis

An organization’s environment includes factors that it can readily affect as well as factors that largely lay beyond its influence. The
latter set of factors are said to exist within the general environment. Because the general environment often has a substantial influence
on an organization’s level of success, executives must track trends and events as they evolve and try to anticipate the implications of
these trends and events.

PESTEL analysis is one important tool that executives can rely on to organize factors within the general environment and to identify
how these factors influence industries and the firms within them. PESTEL is an anagram, meaning it is a word that created by using
parts of other words. In particular, PESTEL reflects the names of the six segments of the general environment: (1) political, (2)
economic, (3) social, (4) technological, (5) environmental, and (6) legal. Wise executives carefully examine each of these six
segments to identify major opportunities and threats and then adjust their firms’ strategies accordingly (Table 3.1 “PESTEL”).
Table 3.1 PESTEL
Examining the general enviornment involves gaining an understanding of key factors and trends in broader society. PESTEL analysis
is a popular framework for organizing these factors and trends and isolating how they influence industries and the firms within them.
Below we describe each of the six dimensions associated with PESTEL analysis: political, economic, social, technological,
environmental, and legal.
P Political factors include elements such as tax policies, changes in trade restrictions and tariffs, and the stability of governments.
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Economic factors include elements such as interest rates, inflation rates, gross domestic product, unemployment rates, levels of
E
disposable income, and the general growth or decline of the economy.

Social factors include trends in demographics such as population size, age, and ethnic mix, as well as cultural trends such as
S
attitudes toward obesity and consumer activism.

Technological factors include, for example, changes in the rate of new product development, increases in automation, and
T
advancements in service industry delivery.

E Environmental factors include, for example, natural disasters and weather patterns.

L Legal factors include laws involving issues such as employment, health and safety, discrimination, and antitrust.

P Is for “Political”

The political segment centers on the role of governments in shaping business. This segment includes elements such as tax policies,
changes in trade restrictions and tariffs, and the stability of governments (Table 3.2 “Political Factors”). Immigration policy is an
aspect of the political segment of the general environment that offers important implications for many different organizations. What
approach to take to illegal immigration into the United States from Mexico has been a hotly debated dilemma. Some hospital
executives have noted that illegal immigrants put a strain on the health care system because immigrants seldom can pay for medical
services and hospitals cannot by law turn them away from emergency rooms.
Table 3.2 Political Factors
Examples of several key trends representing political factors in the general environment are illustrated below.
The extent to which companies developing clean energy sources should be subsidized by the government versus being left on their
own to compete with providers of traditional energy sources is currently a hotly contested political issue.

The use of child labor was once commonplace in the United States now firms face political scrutiny when using overseas suppliers
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that employ child labor.

The word tariff derived from an Arabic word meaning “fees to be paid.” By levying tariffs and implementing other trade restrictions,
governments can — to some extent — protect domestic firms from international competition.

The stability of the US government provides a source of confidence for foreign firms who want to do business in the United States.
Countries that face frequent regime change and political turmoil have a harder time attracting foreign investments.

One of the most important duties of elected officials in the United States is to debate and set new tax policies.

Proposals to provide support to businesses are often featured within political campaigns.

Meanwhile, farmers argue that a tightening of immigration policy would be harmful because farmers rely heavily on cheap labor
provided by illegal immigrants. In particular, if farmers were forced to employ only legal workers, this would substantially increase
the cost of vegetables. Restaurant chains such as Subway would then pay higher prices for lettuce, tomatoes, and other perishables.
Subway would then have to decide whether to absorb these costs or pass them along to customers by charging more for subs. Overall,
any changes in immigration policy will have implications for hospitals, farmers, restaurants, and many other organizations.

E Is for “Economic”

The economic segment centers on the economic conditions within which organizations operate. It includes elements such as interest
rates, inflation rates, gross domestic product, unemployment rates, levels of disposable income, and the general growth or decline of
the economy (Table 3.3 “Economic Factors”). The economic crisis of the late 2000s has had a tremendous negative effect on a vast
array of organizations. Rising unemployment discouraged consumers from purchasing expensive, nonessential goods such as
automobiles and television sets. Bank failures during the economic crisis led to a dramatic tightening of credit markets. This dealt a
huge blow to home builders, for example, who saw demand for new houses plummet because mortgages were extremely difficult to
obtain.
Table 3.3 Economic Factors
Examples of several key trends representing economic factors in the general environment are illustrated below.
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The unemployment rate is the percentage of the labor force actively lookin for employment within the last four weeks. During the
Great Depression of the 1930s, the United States suffered through an unemployment rate of approximately 25%.

Housing starts in an economic indicator that measures the number of houses, apartments, and condos on which new construction has
been started. Because construction involves a wide array of industries–concrete, steel, wood, drywall, plumbing, banks, and many
others–housing starts are a carefully watched measure of economic conditions.

Gross domestic product (GDP) refers to the market value of goods and services within a country produced in a given time period and
serves as a rough indicator of a country’s standard of living. The United States has a much larger GDP than China, but China has
enjoyed a much higher rate of GDP growth in recent years.

The Federal Reserve System (commonly referred to as “The Fed”) is the United States’ central banking system. The Fed attempts to
strengthen the economy through its decisions, such as setting short-term interest rates.

Discretionary income refers to the amount of money individuals have to spend after all necessary bills are paid. As discretionary
income increases, firms such as boutique clothing retailers that sell nonessential goods and services are more likely to prosper.

Some businesses, however, actually prospered during the crisis. Retailers that offer deep discounts, such as Dollar General and
Walmart, enjoyed an increase in their customer base as consumers sought to find ways to economize. Similarly, restaurants such as
Subway that charge relatively low prices gained customers, while high-end restaurants such as Ruth’s Chris Steak House worked hard
to retain their clientele.

Decisions about interest rates made by the Federal Reserve create opportunities for some organizations and threats for others.

S Is for “Social”

A generation ago, ketchup was an essential element of every American pantry and salsa was a relatively unknown product. Today,
however, food manufacturers sell more salsa than ketchup in the United States. This change reflects the social segment of the general
environment. Social factors include trends in demographics such as population size, age, and ethnic mix, as well as cultural trends
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such as attitudes toward obesity and consumer activism (Table 3.4 “Social Factors”). The exploding popularity of salsa reflects the
increasing number of Latinos in the United States over time, as well as the growing acceptance of Latino food by other ethnic groups.
Table 3.4 Social Factors
Examples of several key trends representing social factors in the general environment are illustrated below.
The rise of upscale cupcake outlets reflects a current trend in American eateries: pricey specialty stores are very popular among some
consumers.

Hunters remain a powerful force in American society, but their ranks shrunk by 10% between 1996 and 2006. Wildlife agencies worry
about the loss of license-fee revenue will affect their ability to manage land and water resources, and lower levels of demand for their
products threaten the success of gun makers.

In the 1800s, most American couples raised many children. Farmers, for example, took this approach because it supplied labor that
small farms needed in order to operate. Today, most families are smaller.

One in three Americans is obese, due in part to the increasing prevalence of fast-good restaurants and the popularity of sedentary
activities such as playing video games.

Hemline theory contends that women’s skirt lengths predict stock market increases and declines. The idea was born in the 1920s when
economist George Taylor noticed that many women raised their skirts to reveal their silk stockings when times were good, but
lowered their skirts to hide the fact that they weren’t wearing stockings when times were tough.

The tendency to collect material items while being reluctant to throw them away has led to a rise in self-storage outlets as well as
awareness of a hoarding epidemic.

Sometimes changes in the social segment arise from unexpected sources. Before World War II, the American workforce was
overwhelmingly male. When millions of men were sent to Europe and Asia to fight in the war, however, organizations had no cho ice
but to rely heavily on female employees. At the time, the attitudes of many executives toward women were appalling. Consider, for
example, some of the advice provided to male supervisors of female workers in the July 1943 issue of Transportation Magazine:1
 Older women who have never contacted the public have a hard time adapting themselves and are inclined to be cantankerous and
fussy. It’s always well to impress upon older women the importance of friendliness and courtesy.
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 General experience indicates that “husky” girls—those who are just a little on the heavy side—are more even tempered and
efficient than their underweight sisters.
 Give every girl an adequate number of rest periods during the day. You have to make some allowances for feminine psychology.
A girl has more confidence and is more efficient if she can keep her hair tidied, apply fresh lipstick and wash her hands several
times a day.
The tremendous contributions of female workers during the war contradicted these awful stereotypes. The main role of women who
assembled airplanes, ships, and other war materials was to support the military, of course, but their efforts also changed a lot of male
executives’ minds about what females could accomplish within organizations if provided with opportunities. Inequities in the
workplace still exist today, but modern attitudes among men toward women in the workplace are much more enlightened than they
were in 1943.

T Is for “Technological”

The technological segment centers on improvements in products and services that are provided by science. Relevant factors include,
for example, changes in the rate of new product development, increases in automation, and advancements in service industry delivery
(Table 3.5 “Technological Factors”). One key feature of the modern era is the ever-increasing pace of technological innovation. In
1965, Intel cofounder Gordon E. Moore offered an idea that has come to be known as Moore’s law. Moore’s law suggests that the
performance of microcircuit technology roughly doubles every two years. This law has been very accurate in the decades since it was
offered.
Table 3.5 Technological Factors
Examples of several key trends representing technological factors in the general environment are illustrated below.
Unsuccessful technological innovations such a Smell-O-Vision (a system that would release different odors that matched the events
shown on screen) highlight the risk associated with the technology sector. Image watching a show on horse stables!

The adoption rate of new technology is closely monitored by market research firms. The Internet reached 50 million users in 4 years.
To reach the same number of users took 13 years for TV and 38 years for radio.

The dramatic changes in the video game industry over the past 25 years highlight the need to constantly adapt to technological factors
to maintain market leadership. Once-mighty Atari has given way to current leaders Sony, Nintendo, and Microsoft.
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Moore’s law suggests that the performance of microcircuit technology roughly doubles every two years.

The amount of government spending for research and development affects numerous industries. The government’s decision to
dramatically scale back moon-based space programs may reduce the pace of scientific breakthroughs.

One implication of Moore’s law is that over time electronic devices can become smaller but also more powerful. This creates
important opportunities and threats in a variety of settings. Consider, for example, photography. Just a decade ago, digital cameras
were relatively large and they produced mediocre images. With each passing year, however, digital cameras have become smaller,
lighter, and better. Today, digital cameras are, in essence, minicomputers, and electronics firms such as Panasonic have been able to
establish strong positions in the market. Meanwhile, film photography icon Kodak has been forced to abandon products that had been
successful for decades. In 2005, the firm announced that it would stop producing black-and-white photographic paper. Four years
later, Kodachrome color film was phased out.

Successful technologies are also being embraced at a much faster rate than in earlier generations. The Internet reached fifty million
users in only four years. In contrast, television reached the same number of users in thirteen years while it took radio thirty-eight
years. This trend creates great opportunities for organizations that depend on emerging technologies. Writers of applications for
Apple’s iPad and other tablet devices, for example, are able to target a fast-growing population of users. At the same time,
organizations that depend on technologies that are being displaced must be aware that consumers could abandon them at a very rapid
pace. As more and more Internet users rely on Wi-Fi service, for example, demand for cable modems may plummet.

Moore’s law explains how today’s iPhone can be one hundred times faster, one hundred times lighter, and ten times less expensive
than a “portable” computer built in the 1980s.

Wikimedia Commons – CC BY 2.0.

Although the influence of the technological segment on technology-based companies such as Panasonic and Apple is readily apparent,
technological trends and events help to shape low-tech businesses too. In 2009, Subway started a service called Subway Now. This
service allows customers to place their orders in advance using text messages and avoid standing in line at the store. By offering
customers this service, Subway is also responding to a trend in the general environment’s social segment: the need to save time in
today’s fast-paced society.
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E Is for “Environmental”

The environmental segment involves the physical conditions within which organizations operate. It includes factors such as natural
disasters, pollution levels, and weather patterns (Table 3.6 “Environmental Factors”). The threat of pollution, for example, has forced
municipalities to treat water supplies with chemicals. These chemicals increase the safety of the water but detract from its taste. This
has created opportunities for businesses that provide better-tasting water. Rather than consume cheap but bad-tasting tap water, many
consumers purchase bottled water. Indeed, according to the Beverage Marketing Corporation, the amount of bottled water consumed
by the average American increased from 1.6 gallons in 1976 to 28.3 gallons in 2006 (Earth911). At present, roughly one-third of
Americans drink bottled water regularly.
Table 3.6 Environmental Factors
Examples of several key trends representing enviornmental factors in the general environment are illustrated below.
The Subaru automotive plant in Lafayette, Indiana, was the first auto manufacturing facility to achieve zero landfill status.

Debate has raged over climate change in recent years. To the extend that more policy markers and consumers believe that human
activity is increasing temperatures on the Earth, opportunities could increase for solar energy companies.

Individuals embracing the three Rs of green living–reduce, reuse, recycle–has fueled new business concepts such as Recycle Match, a
firm that brings together waste products with businesses that need those materials.

Concern about the environmental effects of burning fossil fuels has contributed to the growing popularity of scooters.

The increase in the number of food cooperatives reflects growing interest in sustainable, natural foods that are produced with a high
degree of social responsibility.

As is the case for many companies, bottled water producers not only have benefited from the general environment but also have been
threatened by it. Some estimates are that 80 percent of plastic bottles end up in landfills. This has led some socially conscious
consumers to become hostile to bottled water. Meanwhile, water filtration systems offered by Brita and other companies are a cheaper
way to obtain clean and tasty water. Such systems also hold considerable appeal for individuals who feel the need to cut personal
expenses due to economic conditions. In sum, bottled water producers have been provided opportunities by the environmental
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segment of the general environment (specifically, the spread of poor-tasting water to combat pollution) but are faced with threats from
the social segment (the social conscience of some consumers) and the economic segment (the financial concerns of other consumers).

A key trend within the environmental segment is an increasing emphasis on conserving fossil fuels.

L Is for “Legal”

The legal segment centers on how the courts influence business activity. Examples of important legal factors include employment
laws, health and safety regulations, discrimination laws, and antitrust laws (Table 3.7 “Legal Factors”).
Intellectual property rights are a particularly daunting aspect of the legal segment for many organizations. When a studio such as Pixar
produces a movie, a software firm such as Adobe revises a program, or a video game company such as Activision devises a new game,
these firms are creating intellectual property. Such firms attempt to make profits by selling copies of their movies, programs, and
games to individuals. Piracy of intellectual property—a process wherein illegal copies are made and sold by others—poses a serious
threat to such profits. Law enforcement agencies and courts in many countries, including the United States, provide organizations with
the necessary legal mechanisms to protect their intellectual property from piracy.
Table 3.7 Legal Factors
Examples of several key trends representing legal factors in the general environment are illustrated below.
Electronic recycling laws are creating opportunities for “green collar jobs.” A recent Missouri law, for example, requires co mputer
electronic equipment manufacturers to develop and implement recycling plans.

The Sherman Antitrust Act of 1890 limits cartels and monopolies in the United States. Senator John Sherman was the principal author
of this legislation.

In the United States, it is illegal to discriminate against anyone based on age, race, religion, gender or disability.

The role of the Occupational Safety and Health Administration (OSHA) is to prevent work-related injuries, diseases, and fatalities by
enforcing standards for workplace safety and health.
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Laws requiring that nutrition information must appear on the packaging of most food products are intended to protect consumers and
help them make informed choices.

In other countries, such as China, piracy of intellectual property is quite common. Three other general environment segments play a
role in making piracy a major concern. First, in terms of the social segment, China is the most populous country in the world. Second,
in terms of the economic segment, China’s affluence is growing rapidly. Third, in terms of the technological segment, rapid advances
in computers and communication have made piracy easier over time. Taken together, these various general environment trends lead
piracy to be a major source of angst for firms that rely on intellectual property to deliver profits.

Strategic Management - An Introduction

Strategic Management is all about identification and description of the strategies that managers can carry so as to achieve better

performance and a competitive advantage for their organization. An organization is said to have competitive advantage if its

profitability is higher than the average profitability for all companies in its industry.

Strategic management can also be defined as a bundle of decisions and acts which a manager undertakes and which decides the result

of the firm’s performance. The manager must have a thorough knowledge and analysis of the general and competitive organizational

environment so as to take right decisions. They should conduct a SWOT Analysis (Strengths, Weaknesses, Opportunities, and

Threats), i.e., they should make best possible utilization of strengths, minimize the organizational weaknesses, make use of arising

opportunities from the business environment and shouldn’t ignore the threats.
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Strategic management is nothing but planning for both predictable as well as unfeasible contingencies. It is applicable to both small as

well as large organizations as even the smallest organization face competition and, by formulating and implementing appropriate

strategies, they can attain sustainable competitive advantage.

It is a way in which strategists set the objectives and proceed about attaining them. It deals with making and implementing decisions

about future direction of an organization. It helps us to identify the direction in which an organization is moving.

Strategic management is a continuous process that evaluates and controls the business and the industries in which an organization is

involved; evaluates its competitors and sets goals and strategies to meet all existing and potential competitors; and then reevaluates

strategies on a regular basis to determine how it has been implemented and whether it was successful or does it needs replacement.

Strategic Management gives a broader perspective to the employees of an organization and they can better understand how
their job fits into the entire organizational plan and how it is co-related to other organizational members. It is nothing but the

art of managing employees in a manner which maximizes the ability of achieving business objectives. The employees become more

trustworthy, more committed and more satisfied as they can co-relate themselves very well with each organizational task. They can

understand the reaction of environmental changes on the organization and the probable response of the organization with the help of

strategic management. Thus the employees can judge the impact of such changes on their own job and can effectively face the

changes. The managers and employees must do appropriate things in appropriate manner. They need to be both effective as well as

efficient.
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One of the major role of strategic management is to incorporate various functional areas of the organization completely, as well as, to

ensure these functional areas harmonize and get together well. Another role of strategic management is to keep a continuous eye on

the goals and objectives of the organization.

Vision and Mission Statements -- a Roadmap of Where You Want to Go and How to Get There

Have you ever been involved in an organization or business that never seems to accomplish very much? Regardless of how hard you
work, you just go in circles. The problem may be that you have not decided where you want to go and have not created a roadmap of
how to get there. From the perspective of an organization, the problem may be that you are not focusing on what you want to achieve
and how you will achieve it. Below are a series of steps or statements of how to give your organization direction.

The first is a statement of vision. It provides a destination for the organization. Next is a statement of mission. This is a guiding light
of how to get to the destination. These are critical statements for the organization and the individuals who run the organization.

 Vision – Big picture of what you want to achieve.

 Mission – General statement of how you will achieve the vision.

A companion statement often created with the vision and mission is a statement of core values.

 Core Values – How you will behave during the process.

Once you have identified what your organization wants to achieve (vision) and generally how the vision will be achieved (mission),
the next step is to develop a series of statements specifying how the mission will be utilized to achieve the vision:

 Strategies – Strategies are one or more ways to use the mission statement in order to achieve the vision statement. Although an
organization will have just one vision statement and one mission statement, it may have several strategies.
 Goals – These are general statements of what needs to be accomplished to implement a strategy.
 Objectives – Objectives provide specific milestones with a specific timeline for achieving a goal.
 Action Plans – These are specific implementation plans of how you will achieve an objective.
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A more in-depth discussion of these statements is presented below. Statements for an example business are provided for clarification.

Vision Statement – A mental picture of what you want to accomplish or achieve. For example, your vision may be a successful
winery business or an economically active community.

Vision of an Example Business – A successful family dairy business.

Mission Statement – A general statement of how the vision will be achieved. The mission statement is an action statement that
usually begins with the word "to".

Mission of an Example Business – To provide unique and high quality dairy products to local consumers.

Core Values – Core values define the organization in terms of the principles and values the leaders will follow in carrying out the
activities of the organization.

Core Values of the Example Business:

 Focus on new and innovative business ideas

 Practice high ethical standards.
 Respect and protect the environment.
 Meet the changing needs and desires of clients and consumers.

Statements of vision and mission are important so that everyone involved in the organization, including outside stakeholders,
understand what the organization will accomplish and how it will be accomplished. In essence this means “keeping everyone on the
same page” so they are all "pulling in the same direction".

There is a close relationship between the vision and mission. As the vision statement is a static mental picture of what you want to
achieve, the mission statement is a dynamic process of how the vision will be accomplished. To create successful statements, you
should keep the following concepts in mind.

Simple – The vision and mission guide the everyday activities of every person involved in the business. Statements of vision and
mission should be simple, concise and easy to remember. Use just enough words to capture the essence. The statements need to
capture the very essence of what your organization or business will achieve and how it will be achieved. So statements of vision and
mission should be a single thought that can easily be carried in the mind. This makes it easy for everyone in the organization to focus
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on them. To test the effectiveness of your statements, ask the leaders, managers and employees to tell you the vision and mission of
their organization. If they cannot instantaneously tell you both the vision and mission, the statements are of little use.

But that doesn’t mean it will be easy to create the statements. It may require several drafts. Most statements are too long. People tend
to add additional information and qualifications to the statements. Usually the additional information just confuses the reader and
clouds the essence of the statement. Each successive draft of the vision and mission should be to simplify and clarify by using as few
words as possible.

Fluid Process – The statements are not "cast in stone". They can be updated and modified if the organization changes its focus. It is
often good to write the statements, use them for a period of time, and then revisit them a few months or a year later if needed. It may
be easier to sharpen the focus of the statement at that time. Remember, the reason you are writing the statements is to clarify what you
are doing.

Unique and Complex Organizations – It is usually more important to write statements for non-traditional organization where the
purpose of the organization is unique. The same is true for complex organizations where it may be difficult to sift down to the essence
of the existence of the organization.

Strategies, Goals, Objectives and Action Plans

Once you have created statements of vision and mission, and possibly core values, you can then develop the strategies, goals,
objectives and action plans needed to activate your mission and achieve your vision.

Strategies – A strategy is a statement of how you are going to achieve something. More specifically, a strategy is a unique approach
of how you will use your mission to achieve your vision. Strategies are critical to the success of an organization because this is where
you begin outlining a plan for doing something. The more unique the organization, the more creative and innovative you need to be in
crafting your strategies.

Goals – A goal is a general statement of what you want to achieve. More specifically, a goal is a milestone(s) in the process of
implementing a strategy. Examples of business goals are:

 Increase profit margin

 Increase efficiency
 Capture a bigger market share
 Provide better customer service
 Improve employee training
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 Reduce carbon emissions

Be sure the goals are focused on the important aspects of implementing the strategy. Be careful not to set too many goals or you may
run the risk of losing focus. Also, design your goals so that they don’t contradict and interfere with each other. A goal should meet the
following criteria:

 Understandable: Is it stated simply and easy to understand?

 Suitable: Does it assist in implementing a strategy of how the mission will achieve the vision?
 Acceptable: Does it fit with the values of the organization and its members/employees?
 Flexible: Can it be adapted and changed as needed?

Objectives – An objective turns a goal’s general statement of what is to be accomplished into a specific, quantifiable, time-sensitive
statement of what is going to be achieved and when it will be achieved. Examples of business objectives are:

 Earn at least a 20 percent after-tax rate of return on our investment during the next fiscal year
 Increase market share by 10 percent over the next three years.
 Lower operating costs by 15 percent over the next two years through improvement in the efficiency of the manufacturing process.
 Reduce the call-back time of customer inquiries and questions to no more than four hours.

Objectives should meet the following criteria:

 Measurable: What specifically will be achieved and when will it be achieved?

 Suitable: Does it fit as a measurement for achieving the goal?
 Feasible: Is it possible to achieve?
 Commitment: Are people committed to achieving the objective?
 Ownership: Are the people responsible for achieving the objective included in the objective-setting process?

Action Plans – Action plans are statements of specific actions or activities that will be used to achieve a goal within the constraints of
the objective. Examples of action plans within the context of goals and objectives are:
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Action plans may be simple statements or full blown and detailed business plans where goals and objectives are also included. Action
plans may also be used to implement an entire strategy (called strategic planning).

Putting it All Together

To help you understand the relationship between each of these statements, examples of strategies, goals, objectives and action plans
are shown for a business organization designed to improve the rural economy through developing rural businesses. Remember, the
vision is what you want to accomplish. Mission is a general statement of how you will achieve your vision. Strategies are a series of
ways of using the mission to achieve the vision. Goals are statements of what needs to be accomplished to implement the strategy.
Objectives are specific actions and timelines for achieving the goal. Action plans are specific actions that need to be taken for reaching
the milestones within the timeline of the objectives.
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12 Different Types of Leadership Styles

According to Research by asaecenter, leadership style is the way a person uses power to lead other people. Research has identified a
variety of leadership styles based on the number of followers. The most appropriate leadership style depends on the function of the
leader, the followers and the situation.
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Some leaders cannot work comfortably with a high degree of followers’ participation in decision making. Some employers lack the
ability or the desire to assume responsibility. Furthermore, the specific situation helps determine the most effective style of
interactions. Sometimes leaders must handle problems that require immediate solutions without consulting followers.
What are Different Leadership Styles?
We have covered 12 different types of ways people tend to lead organizations or other people. Not all of these styles would deem fit
for all kind of situations, you can read them through to see which one fits right to your company or situation.
1. Autocratic Leadership
Autocratic leadership style is centered on the boss. In this leadership the leader holds all authority and responsibility. In this
leadership, leaders make decisions on their own without consulting subordinates. They reach decisions, communicate them to
subordinates and expect prompt implementation. Autocratic work environment does normally have little or no flexibility.
In this kind of leadership, guidelines, procedures and policies are all natural additions of an autocratic leader. Statistically, there are
very few situations that can actually support autocratic leadership.
Some of the leaders that support this kind of leadership include: Albert J Dunlap (Sunbeam Corporation) and Donald Trump (Trump
Organization) among others.
2. Democratic Leadership
In this leadership style, subordinates are involved in making decisions. Unlike autocratic, this headship is centered on subordinates’
contributions. The democratic leader holds final responsibility, but he or she is known to delegate authority to other people, who
determine work projects.
The most unique feature of this leadership is that communication is active upward and downward. With respect to statistics,
democratic leadership is one of the most preferred leadership, and it entails the following: fairness, competence, creativity, courage,
intelligence and honesty.
3. Strategic Leadership Style
Strategic leadership is one that involves a leader who is essentially the head of an organization. The strategic leader is not limited to
those at the top of the organization. It is geared to a wider audience at all levels who want to create a high performance life, team or
organization.
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The strategic leader fills the gap between the need for new possibility and the need for practicality by providing a prescriptive set of
habits. An effective strategic leadership delivers the goods in terms of what an organization naturally expects from its leadership in
times of change. 55% of this leadership normally involves strategic thinking.
4. Transformational Leadership
Unlike other leadership styles, transformational leadership is all about initiating change in organizations, groups, oneself and others.
Transformational leaders motivate others to do more than they originally intended and often even more than they thought possible.
They set more challenging expectations and typically achieve higher performance.
Statistically, transformational leadership tends to have more committed and satisfied followers. This is mainly so because
transformational leaders empower followers.
5. Team Leadership
Team leadership involves the creation of a vivid picture of its future, where it is heading and what it will stand for. The vision inspires
and provides a strong sense of purpose and direction.
Team leadership is about working with the hearts and minds of all those involved. It also recognizes that teamwork may not always
involve trusting cooperative relationships. The most challenging aspect of this leadership is whether or not it will succeed. According
to Harvard Business Review, team leadership may fail because of poor leadership qualities.

6. Cross-Cultural Leadership
This form of leadership normally exists where there are various cultures in the society. This leadership has also industrialized as a way
to recognize front runners who work in the contemporary globalized market.
Organizations, particularly international ones require leaders who can effectively adjust their leadership to work in different environs.
Most of the leaderships observed in the United States are cross-cultural because of the different cultures that live and work there.
7. Facilitative Leadership
Facilitative leadership is too dependent on measurements and outcomes – not a skill, although it takes much skill to master. The
effectiveness of a group is directly related to the efficacy of its process. If the group is high functioning, the facilitative leader uses a
light hand on the process.
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On the other hand, if the group is low functioning, the facilitative leader will be more directives in helping the group run its process.
An effective facilitative leadership involves monitoring of group dynamics, offering process suggestions and interventions to help the
group stay on track.
8. Laissez-faire Leadership
Laissez-faire leadership gives authority to employees. According to azcentral, departments or subordinates are allowed to work as they
choose with minimal or no interference. According to research, this kind of leadership has been consistently found to be the least
satisfying and least effective management style.

9. Transactional Leadership
This is a leadership that maintains or continues the status quo. It is also the leadership that involves an exchange process, whereby
followers get immediate, tangible rewards for carrying out the leader’s orders. Transactional leadership can sound rather basic, with its
focus on exchange.
Being clear, focusing on expectations, giving feedback are all important leadership skills. According to Boundless.com, transactional
leadership behaviors can include: clarifying what is expected of followers’ performance; explaining how to meet such expectations;
and allocating rewards that are contingent on meeting objectives.
10. Coaching Leadership
Coaching leadership involves teaching and supervising followers. A coaching leader is highly operational in setting where results/
performance require improvement. Basically, in this kind of leadership, followers are helped to improve their skills. Coaching
leadership does the following: motivates followers, inspires followers and encourages followers.
11. Charismatic Leadership
In this leadership, the charismatic leader manifests his or her revolutionary power. Charisma does not mean sheer behavioral change.
It actually involves a transformation of followers’ values and beliefs.
Therefore, this distinguishes a charismatic leader from a simply populist leader who may affect attitudes towards specific objects, but
who is not prepared as the charismatic leader is, to transform the underlying normative orientation that structures specific attitudes.
12. Visionary Leadership
This form of leadership involves leaders who recognize that the methods, steps and processes of leadership are all obtained with and
through people. Most great and successful leaders have the aspects of vision in them.
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However, those who are highly visionary are the ones considered to be exhibiting visionary leadership. Outstanding leaders will
always transform their visions into realities.

Change Management Strategies

To remain competitive in the market, it’s crucial for companies to evolve and adapt to the changing climate. But organizational change
in a company can be incredibly disruptive — affecting employees, top-tier executives, and the company success as a whole — if you
don’t have strong change management. In fact, most efforts toward organizational change fail. Not many, but most.
Specifically, according to Torben Rick:
 70% of change efforts fail to meet target impact
 33% of change efforts fail because management behavior does not support the change
 39% of efforts fail because employees are resistant to change
 14% of efforts fail because of a lack of adequate funds or resources
 14% of efforts fail for “other” reasons
Clearly the majority of companies are not effective at change management. It’s not as simple as just changing a company name from
the CEO’s office; deciding to merge with a similar successful company from the CFO’s advice; or undergoing a process, culture,
strategy, technology, hierarchy, or management change, big or small. Successful change needs to take into account every aspect of the
company, from the culture to the executives to the part-time staff and everyone else. There are several essential techniques for change
management that companies can — and should — adopt before jumping into any change effort.

Start at the Top

Change management, of course, is directly impacted by the change managers. Ensure that the people at the helm of the change ship
are competent. Before you even start any change, a CEO should align the best team at the top. So how do you know if they are?
Change managers aren’t just the strategy people — though that’s a very important part of the job — they also need to exemplify the
change and be incredibly effective communicators so they can spread the word, bringing pride to the strategy.
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Ask for Feedback, Even Before You Begin

It’s one thing to ask for feedback once your organization is shoulder deep in a change initiative, but you’ll be far more effective if you
begin your change strategy with feedback already in hand. Too often these major moves are entirely planned by high-level executives
without anyone else’s input.
According to a Katzenback Center survey, 38% of lower-level employees do not agree with the change initiative their company is
undergoing. This type of information and opinions from frontline employees, often the ones who are directly affected by the day-to-
day of the change, can help streamline the change and better set it up for success.

Define Exactly What the Change Is

It’s not enough to just state that your company will be undergoing a transition. It’s essential that companies set definable, achievable
goals for the transition as clearly as possible. For example, while it’s nice to say that a change in upper management will “boost
company morale” or “accelerate growth,” it’s far better to set exact statistics that can be measured for success.
Make these goals “SMART”: Specific, Measurable, Action Oriented, Realistic, and Time Bound. That way, not only will you give
your employees a concrete objective to look forward to, but you’ll also be able to measure your progress in a useful way.

Simplify, Simplify, Simplify

Just like defining the exact changes, keep it simple. Don’t try to do too much at once, as success can get muddled and employees can
be confused. Stick to a goal and define it as simply as possible for people at every level of the company.

Learn from High School Science Class

Remember when you took part in high school science experiments? Your teacher likely taught you about the scientific method. You
can use this method for introducing change into your company.
Begin by introducing the change into only a section of the company, which will act as the “treatment group,” according to Harvard
Business Review. The unchanged portion of the company (or team) will be the control group. The differences in productivity, morale,
finances, and other statistics can help determine whether the change can show success across the entire company or whether it’s a
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failure and needs more tinkering before escalating it. Of course, far more sophisticated measurements can also be drawn from the
information if you have the resources.

Change Shouldn’t Just Be Bottom-Line Numbers

Remember that clearly defined goal? It shouldn’t just be finances and figures. The emotional aspect of organizational change is just as
important, particularly to get all employees on board — especially for millennials who are driven by company values that reach
beyond its four walls. Make sure there’s an emotional drive toward making a change — whether it’s entering new markets to help
people from other parts of the world or something tailored specifically toward your company. Don’t overestimate the value of the
dollar; don’t underestimate the heartstrings.

Implement Formal Recognition Programs

Companies that have embedded employee recognition programs — and all of them should — can implement rewards for employees
who are best aiding in the change. Tailor the rewards to specific actions and company values that help the change. It shows employees
how to model their behavior and actions toward what the upper management is looking for in this time of upheaval. What’s more, it
shows that the company truly appreciates and acknowledges its employees during what can be a difficult time for many staffers.

Never Stop Communicating

It’s not enough to communicate the change at the outset and then assume all employees are on board. Look constantly for feedback —
and actually use that feedback to adjust and realign your strategy as needed. Short surveys, team meetings, and company-wide
webcasts can assist and ensure that employees all stay on the same page during this time of transition.
Organizational change, no matter how big or small, can be a stressful time for employees at every level of the company. This is why
effective change management is so crucial. Keeping employee morale high with strong communication, a culture of feedback, and
employee recognition can work wonders in ensuring that your change initiative doesn’t go off the rails even before the transition.
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Traits of a good leader are common across disciplines, professions and geographical regions. Community leadership is unique in its
approach and goals. Community leadership is not about managing or even coordinating. And it is certainly not about dictating or
imposing your own ideas onto others.

In addition to traits of superior leadership in any discipline, such as integrity and responsibility, here are ten characteristics that are
particular to excellent community leaders:

1. Maximize Individuals’ Strengths

Community leaders often work with volunteers. They may be elected by members of the community, assigned to work with a group,
or they simply step forward and want to help. In any case, community leaders rarely have the luxury of choosing who they work with.

Your job involves being able to identify the strengths and interests of each person on your leadership team and maximize those talents
and skills in a way that keeps your team engaged in the work. Your fellow leaders need to feel that they are making a meaningful
contribution to the group, the community and the work.

2. Balance the Needs of Your Leadership Group

Some individuals may have a strong need for control. Others may have a deep need to be appreciated for their time and service. As a
community leader, your job is to balance everyone’s needs, as well as keep your sights focused on the work that needs to be done for
the group to move forward.

3. Work as a Team

Let’s face it, community leadership is slow work. It is much less efficient than, say, military leadership, where underlings simply obey
the orders of their superior officers. Community leadership means that one person does not do it all.
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It can be useful to teach your leadership team the difference between efficiency and effectiveness. An efficient leader will take a task
away from someone who is not completing their work in a timely manner. An effective leader will ensure that the person gets the
support they need to complete the task. Effectiveness often takes more time than efficiency. Community leadership is about building
relationships and working together. Being patient with one another and supporting one another process builds capacity and
relationships. But be forewarned, this takes much more time than simply being efficient.

4. Mobilize Others

Even a leadership team can not do it all. You will likely have to work with staff and volunteers to undertake big projects. Community
leadership is part education, part inspiration, part motivation and part mobilization.

Mobilizing others is not about telling them what to do, barking orders at them or dictating how things need to get done. It is about
finding a balance between what needs to be done, who can do it, who is willing and has time to do it, assigning the work and then
showing appreciation for others’ efforts. Learning to have some fun while you work together is an important aspect of mobilizing and
motivating others.

5. Pitch In

There is a myth that leaders lead, and do-ers do. But in a community, leading by example is often the most effective way to get full
buy-in for projects. Don’t schedule a community clean-up unless you are willing to get out there with a garbage bag yourself.

Community leaders are rarely have the luxury of focussing only on policy and governance. This kind of work involves arriving early,
staying late, cleaning up, and generally rolling up your sleeves to pitch in.

6. Practice Stewardship
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This is about getting people to take responsibility for their physical space and surroundings. This includes natural areas, structures and
spaces. Stewardship means working together to protect, preserve and take care of your community. This involves renewing, repairing,
rebuilding and constantly reviewing your physical community to ensure that it is healthy, strong and well-maintained.

7. Be Accountable to the Community

Above all else community leadership is about the people who live with you and near you. The people who form the community are the
beneficiaries, but also those who whom you, as a leadership are accountable.

Community leadership is not just about policies, processes or procedures. More than anything, it is about people.

Often when I guide community leaders in my work, I will ask “What do you think will happen at the next Annual General Meeting if
this does — or does not — move forward?” This keeps the leadership team focussed on why they are doing what they do, and why
they are really making decisions.

8. Think forward

There is a saying in some Aboriginal communities about thinking five generations ahead. Being a community leader means not only
thinking for today, or even tomorrow, but being able to make wise decisions that will still benefit the residents long after the current
leadership team is gone.

9. Recruit and Mentor New Leaders

Speaking of the current leadership team being gone, community leaders often get so caught up in all the work that needs to be done
today, that they forget to think about tomorrow. Planning for the future is an important aspect of community leadership. Having a
healthy base of volunteers and having individuals ready to take on new positions are indicators of a healthy community.
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Community leadership work means building a succession plan to keep the community strong as you move forward into the future.

10. Walk Beside, Don’t Lead From Above

In some models, leadership is a position in a hierarchy. Those at the top of the hierarchy have the power and make the decisions.
Community leadership is about developing every persons capacity for leadership, starting with self-leadership and self-responsibility.
Those who have positions of leadership must demonstrate principles and practices of good leadership by living the example. So, the
community leader does not take the prime parking spot out of a sense of entitlement. There are no special privileges that put
community leaders above others who live in the community. Every member of the community has responsibilities and rights.
Community leaders walk beside others and listen to them.

A community leader’s job is not to take on all the problems of the world themselves and fix everything, but rather to work together
with everyone in the community, to mobilize and guide others, to facilitate solutions and thing about the long-term health of the
community and its people.

The purpose of the Myers-Briggs Type Indicator® (MBTI®) personality inventory is to make the theory of psychological types
described by C. G. Jung understandable and useful in people's lives. The essence of the theory is that much seemingly random
variation in the behavior is actually quite orderly and consistent, being due to basic differences in the ways individuals prefer to use
their perception and judgment.

"Perception involves all the ways of becoming aware of things, people, happenings, or ideas. Judgment involves all the ways of
coming to conclusions about what has been perceived. If people differ systematically in what they perceive and in how they reach
conclusions, then it is only reasonable for them to differ correspondingly in their interests, reactions, values, motivations, and skills."
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In developing the Myers-Briggs Type Indicator [instrument], the aim of Isabel Briggs Myers, and her mother, Katharine Briggs, was
to make the insights of type theory accessible to individuals and groups. They addressed the two related goals in the developments and
application of the MBTI instrument:

The identification of basic preferences of each of the four dichotomies specified or implicit in Jung's theory.

The identification and description of the 16 distinctive personality types that result from the interactions among the preferences."

Excerpted with permission from the MBTI® Manual: A Guide to the Development and Use of the Myers-Briggs Type Indicator®

Favorite world: Do you prefer to focus on the outer world or on your own inner world? This is called Extraversion (E) or Introversion
(I).

Information: Do you prefer to focus on the basic information you take in or do you prefer to interpret and add meaning? This is
called Sensing (S) or Intuition (N).

Decisions: When making decisions, do you prefer to first look at logic and consistency or first look at the people and special
circumstances? This is called Thinking (T) or Feeling (F).

Structure: In dealing with the outside world, do you prefer to get things decided or do you prefer to stay open to new information and
options? This is called Judging (J) or Perceiving (P).

Your Personality Type: When you decide on your preference in each category, you have your own personality type, which can be
expressed as a code with four letters.
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The 16 personality types of the Myers-Briggs Type Indicator® instrument are listed here as they are often shown in what is called a
"type table."

For a description of your MBTI type, place your cursor over the box containing your four-letter type code. You may also wish to
browse through all of the 16 type descriptions.
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If you do not know your MBTI type, you may wish to take the instrument.

Type tables can also be used to gather and facilitate analysis of information about teams or specific groups of people.

All types are equal: The goal of knowing about personality type is to understand and appreciate differences between people. As all
types are equal, there is no best type.

The MBTI instrument sorts for preferences and does not measure trait, ability, or character. The MBTI tool is different from
many other psychological instruments and also different from other personality tests.

The best reason to choose the MBTI instrument to discover your personality type is that hundreds of studies over the past 40 years
have proven the instrument to be both valid and reliable. In other words, it measures what it says it does (validity) and produces the
same results when given more than once (reliability). When you want an accurate profile of your personality type, ask if the
instrument you plan to use has been validated.

The theory of psychological type was introduced in the 1920s by Carl G. Jung. The MBTI tool was developed in the 1940s by Isabel
Briggs Myers and the original research was done in the 1940s and '50s. This research is ongoing, providing users with updated and
new information about psychological type and its applications. Millions of people worldwide have taken the Indicator each year since
its first publication in 1962.

ISTJ
Quiet, serious, earn success by thoroughness and dependability. Practical, matter-of-fact, realistic, and responsible. Decide logically
what should be done and work toward it steadily, regardless of distractions. Take pleasure in making everything orderly and organized
- their work, their home, their life. Value traditions and loyalty.
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ISFJ
Quiet, friendly, responsible, and conscientious. Committed and steady in meeting their obligations. Thorough, painstaking, and
accurate. Loyal, considerate, notice and remember specifics about people who are important to them, concerned with how others feel.
Strive to create an orderly and harmonious environment at work and at home.

INFJ
Seek meaning and connection in ideas, relationships, and material possessions. Want to understand what motivates people and are
insightful about others. Conscientious and committed to their firm values. Develop a clear vision about how best to serve the common
good. Organized and decisive in implementing their vision.

INTJ
Have original minds and great drive for implementing their ideas and achieving their goals. Quickly see patterns in external events and
develop long-range explanatory perspectives. When committed, organize a job and carry it through. Skeptical and independent, have
high standards of competence and performance - for themselves and others.

ISTP
Tolerant and flexible, quiet observers until a problem appears, then act quickly to find workable solutions. Analyze what makes things
work and readily get through large amounts of data to isolate the core of practical problems. Interested in cause and effect, organize
facts using logical principles, value efficiency.

ISFP
Quiet, friendly, sensitive, and kind. Enjoy the present moment, what's going on around them. Like to have their own space and to
work within their own time frame.Loyal and committed to their values and to people who are important to them. Dislike
disagreements and conflicts, do not force their opinions or values on others.

INFP
Idealistic, loyal to their values and to people who are important to them. Want an external life that is congruent with their values.
Curious, quick to see possibilities, can be catalysts for implementing ideas. Seek to understand people and to help them fulfill their
potential. Adaptable, flexible, and accepting unless a value is threatened.
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INTP
Seek to develop logical explanations for everything that interests them. Theoretical and abstract, interested more in ideas than in social
interaction. Quiet, contained, flexible, and adaptable. Have unusual ability to focus in depth to solve problems in their area of interest.
Skeptical, sometimes critical, always analytical.

ESTP
Flexible and tolerant, they take a pragmatic approach focused on immediate results. Theories and conceptual explanations bore them -
they want to act energetically to solve the problem. Focus on the here-and-now, spontaneous, enjoy each moment that they can be
active with others. Enjoy material comforts and style. Learn best through doing.

ESFP
Outgoing, friendly, and accepting. Exuberant lovers of life, people, and material comforts. Enjoy working with others to make things
happen. Bring common sense and a realistic approach to their work, and make work fun. Flexible and spontaneous, adapt readily to
new people and environments. Learn best by trying a new skill with other people.

ENFP
Warmly enthusiastic and imaginative. See life as full of possibilities. Make connections between events and information very quickly,
and confidently proceed based on the patterns they see. Want a lot of affirmation from others, and readily give appreciation and
support. Spontaneous and flexible, often rely on their ability to improvise and their verbal fluency.

ENTP
Quick, ingenious, stimulating, alert, and outspoken.Resourceful in solving new and challenging problems.Adept at generating
conceptual possibilities and then analyzing them strategically. Good at reading other people. Bored by routine, will seldom do the
same thing the same way, apt to turn to one new interest after another.

ESTJ
Practical, realistic, matter-of-fact. Decisive, quickly move to implement decisions. Organize projects and people to get things done,
focus on getting results in the most efficient way possible. Take care of routine details. Have a clear set of logical standards,
systematically follow them and want others to also. Forceful in implementing their plans.
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ESFJ
Warmhearted, conscientious, and cooperative. Want harmony in their environment, work with determination to establish it. Like to
work with others to complete tasks accurately and on time.Loyal, follow through even in small matters. Notice what others need in
their day-by-day lives and try to provide it. Want to be appreciated for who they are and for what they contribute.

ENFJ
Warm, empathetic, responsive, and responsible.Highly attuned to the emotions, needs, and motivations of others. Find potential in
everyone, want to help others fulfill their potential. May act as catalysts for individual and group growth.Loyal, responsive to praise
and criticism. Sociable, facilitate others in a group, and provide inspiring leadership.

ENTJ
Frank, decisive, assume leadership readily. Quickly see illogical and inefficient procedures and policies, develop and implement
comprehensive systems to solve organizational problems. Enjoy long-term planning and goal setting. Usually well informed, well
read, enjoy expanding their knowledge and passing it on to others. Forceful in presenting their ideas.

The Processes of Organization and Management

A unifying framework for thinking about processes — or sequences of tasks and activities — that provides an integrated,
dynamic picture of organizations and managerial behavior.
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Managers today are enamored of processes. It’s easy to see why. Many modern organizations are functional and hierarchical; they
suffer from isolated departments, poor coordination, and limited lateral communication. All too often, work is fragmented and
compartmentalized, and managers find it difficult to get things done. Scholars have faced similar problems in their research, struggling
to describe organizational functioning in other than static, highly aggregated terms. For real progress to be made, the “proverbial
‘black box,’ the firm, has to be opened and studied from within.”1
Processes provide a likely solution. In the broadest sense, they can be defined as collections of tasks and activities that together — and
only together — transform inputs into outputs. Within organizations, these inputs and outputs can be as varied as materials,
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information, and people. Common examples of processes include new product development, order fulfillment, and customer service;
less obvious but equally legitimate candidates are resource allocation and decision making.
Over the years, there have been a number of process theories in the academic literature, but seldom has anyone reviewed them
systematically or in an integrated way. Process theories have appeared in organization theory, strategic management, operations
management, group dynamics, and studies of managerial behavior. The few scholarly efforts to tackle processes as a collective
phenomenon either have been tightly focused theoretical or methodological statements or have focused primarily on a single type of
process theory.2
Yet when the theories are taken together, they provide a powerful lens for understanding organizations and management:
First, processes provide a convenient, intermediate level of analysis. Because they consist of diverse, interlinked tasks, they open up
the black box of the firm without exposing analysts to the “part-whole” problems that have plagued earlier research.3 Past studies
have tended to focus on either the trees (individual tasks or activities) or the forest (the organization as a whole); they have not
combined the two. A process perspective gives the needed integration, ensuring that the realities of work practice are linked explicitly
to the firm’s overall functioning.4
Second, a process lens provides new insights into managerial behavior. Most studies have been straightforward descriptions of time
allocation, roles, and activity streams, with few attempts to integrate activities into a coherent whole.5 In fact, most past research has
highlighted the fragmented quality of managers’ jobs rather than their coherence. A process approach, by contrast, emphasizes the
links among activities, showing that seemingly unrelated tasks — a telephone call, a brief hallway conversation, or an unscheduled
meeting — are often part of a single, unfolding sequence. From this vantage point, managerial work becomes far more rational and
orderly.
My aim here is to give a framework for thinking about processes, their impacts, and the implications for managers. I begin at the
organizational level, reviewing a wide range of process theories and grouping them into categories. The discussion leads naturally to a
typology of processes and a simple model of organizations as interconnected sets of processes. In the next section, I examine
managerial processes; I consider them separately because they focus on individual managers and their relationships, rather than on
organizations. I examine several types of managerial processes and contrast them with, and link them to, organizational processes, and
identify their common elements. I conclude with a unifying framework that ties together the diverse processes and consider the
implications for managers.
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Organizational Processes

Scholars have developed three major approaches to organizational processes. They are best considered separate but related schools of
thought because each focuses on a particular process and explores its distinctive characteristics and challenges. The three categories
are (1) work processes, (2) behavioral processes, and (3) change processes (see “Three Approaches to Organizational Processes”).
Three Approaches to Organizational Processes

WORK PROCESSES
• “A process is thus a specific ordering of work activities across time and place, with a beginning, an end, and clearly defined inputs
and outputs: a structure for action.”
T.H. Davenport, Process Innovation (Boston: Harvard Business School Press, 1993), p. 5.
See more

Work Processes

The work process approach, which has roots in industrial engineering and work measurement, focuses on accomplishing tasks. It starts
with a simple but powerful idea: organizations accomplish their work through linked chains of activities cutting across departments
and functional groups. These chains are called processes and can be conveniently grouped into two categories: (1) processes that
create, produce, and deliver products and services that customers want, and (2) processes that do not produce outputs that customers
want, but that are still necessary for running the business. I call the first group “operational processes” and the second group
“administrative processes.” New product development, manufacturing, and logistics and distribution are examples of operational
processes, while strategic planning, budgeting, and performance measurement are examples of administrative processes.
Operational and administrative processes share several characteristics. Both involve sequences of linked, interdependent activities that
together transform inputs into outputs. Both have beginnings and ends, with boundaries that can be defined with reasonable precision
and minimal overlap. And both have customers, who may be internal or external to the organization. The primary differences between
the two lie in the nature of their outputs. Typically, operational processes produce goods and services that external customers
consume, while administrative processes generate information and plans that internal groups use. For this reason, the two are
frequently considered independent, unrelated activities, even though they must usually be aligned and mutually supportive if the
organization is to function effectively. Skilled supply chain management, for example, demands a seamless link between a company’s
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forecasting and logistics processes, just as successful new product development rests on well-designed strategy formation and
planning processes.
The work processes approach is probably most familiar to managers. It draws heavily on the principles of the quality movement and
reengineering.6 Both focus on the need to redesign processes to improve quality, cut costs, reduce cycle times, or otherwise enhance
operating performance. Despite these shared goals, the two movements are strikingly similar on some points, but diverge on others.
The similarities begin with the belief that most existing work processes have grown unchecked, with little rationale or planning, and
are therefore terribly inefficient. Hammer, for example, has observed: “Why did we design inefficient processes? In a way, we didn’t.
Many of our procedures were not designed at all; they just happened. … The hodgepodge of special cases and quick fixes was passed
from one generation of workers to the next.”7 The result, according to one empirical study of white-collar processes, is that value-
added time (the time in which a product or service has value added to it, as opposed to waiting in a queue or being reworked to fix
problems caused earlier) is typically less than 5 percent of total processing time.8
To eliminate inefficiencies, both movements suggest that work processes be redesigned. In fact, both implicitly equate process
improvement with process management. They also suggest the use of similar tools, such as process mapping and data modeling, as
well as common rules of thumb for identifying improvement opportunities.9 First, flow charts are developed to show all the steps in a
process; the process is then made more efficient by eliminating multiple approvals and checkpoints, finding opportunities to reduce
waiting time, smoothing the hand-offs between departments, and grouping related tasks and responsibilities.10 At some point,
“process owners” with primary responsibility for leading the improvement effort are also deemed necessary. Their role is to ensure
integration and overcome traditional functional loyalties; for this reason, relatively senior managers are usually assigned the task.11
The differences between the two movements lie in their views about the underlying nature and sources of process change. The quality
movement, for the most part, argues for incremental improvement.12 Existing work processes are assumed to have many desirable
properties; the goal is to eliminate unnecessary steps and errors while preserving the basic structure of the process. Improvements are
continuous and relatively small scale. Reengineering, by contrast, calls for radical change.13 Existing work processes are regarded as
hopelessly outdated; they rely on work practices and a division of labor that take no account of modern information technology.
For example, the case management approach, in which “individuals or small teams … perform a series of tasks, such as the fulfillment
of a customer order from beginning to end, often with the help of information systems that reach throughout the organization,” was
not economically viable until the arrival of powerful, inexpensive computers and innovative software.14 For this reason, reengineering
focuses less on understanding the details of current work processes and more on “inventing a future” based on fundamentally new
processes.15
Perhaps the most dramatic difference between the two approaches lies in the importance they attach to control and measurement.
Quality experts, drawing on their experience with statistical process control in manufacturing, argue that well-managed work
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processes must be fully documented, with clearly defined control points.16 Managers can improve a process, they believe, only if they
first measure it with accuracy and assure its stability.17 After improvement, continuous monitoring is required to maintain the gains
and ensure that the process performs as planned. Reengineering experts, on the other hand, are virtually silent about measurement and
control. They draw on a different tradition, information technology, that emphasizes redesign rather than control.
Insights for Managers. The work processes perspective has led to a number of important insights for managers. It provides an
especially useful framework for addressing a common organizational problem: fragmentation, or the lack of cross-functional
integration. Many aspects of modern organizations make integration difficult, including complexity, highly differentiated subunits and
roles, poor informal relationships, size, and physical distance.18 Integration is often improved by the mere acknowledgment of work
processes as viable units of analysis and targets of managerial action.19 Charting horizontal work flows, for example, or following an
order through the fulfillment system are convenient ways to remind employees that the activities of disparate departments and
geographical units are interdependent, even if organization charts, with their vertical lines of authority, suggest otherwise.
In addition, the work processes perspective provides new targets for improvement. Rather than focusing on structures and roles,
managers address the underlying processes. An obvious advantage is that they closely examine the real work of the organization. The
results, however, have been mixed, and experts estimate that a high proportion of these programs have failed to deliver the expected
gains.
My analysis suggests several reasons for failure. Most improvement programs have focused exclusively on process redesign; the
ongoing operation and management of the reconfigured processes have usually been neglected. Yet even the best processes will not
perform effectively without suitable oversight, coordination, and control, as well as occasional intervention. In addition, operational
processes have usually been targeted for improvement, while their supporting administrative processes have been overlooked.
Incompatibilities and inconsistencies have arisen when the information and plans needed for effective operation were not forthcoming.
A few companies have used the work processes approach to redefine their strategy and organization. The most progressive have
blended a horizontal process orientation with conventional vertical structures.

Behavioral Processes

The behavioral process approach, which has roots in organization theory and group dynamics, focuses on ingrained behavior patterns.
These patterns reflect an organization’s characteristic ways of acting and interacting; decision-making and communication processes
are examples. The underlying behavior patterns are normally so deeply embedded and recurrent that they are displayed by most
organizational members. They also have enormous staying power. As Weick observed, behavioral processes are able to “withstand the
turnover of personnel as well as some variation in the actual behaviors people contribute.”21
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All behavioral processes share several characteristics. They are generalizations, distilled from observations of everyday work and have
no independent existence apart from the work processes in which they appear. This makes them difficult to identify but explains their
importance. Behavioral processes profoundly affect the form, substance, and character of work processes by shaping how they are
carried out. They are different, however, from organizational culture because they reflect more than values and beliefs. Behavioral
processes are the sequences of steps used for accomplishing the cognitive and interpersonal aspects of work. New product
development processes, for example, may have roughly similar work flows yet still involve radically different patterns of decision
making and communication. Often, it is these underlying patterns that determine the operational process’s ultimate success or
failure.22
Next I discuss three categories of behavioral processes, selected for their representativeness and rich supporting literature: decision-
making, communication, and organizational learning processes. All involve the collection, movement, and interpretation of
information, as well as forms of interpersonal interaction. In most cases, the associated behaviors are learned informally, through
socialization and on-the-job experience, rather than through formal education and training programs.
Decision-Making Processes. Of all behavioral processes, decision making has been the most carefully studied. The roots go back to
the research and writings of Chester Barnard and Herbert Simon, who argued that organizational decision making was a distributed
activity, extending over time, involving a number of people.23 Because it was a process rather than a discrete event, a critical
management task was shaping the environment of decision making to produce desired ends. This, in itself, is still a surprising insight
for many managers. All too often, they see decision making as their personal responsibility, rather than as a shared, dispersed activity
that they must orchestrate and lead.24
These early writings spawned a vast outpouring of research on decision making; eventually they coalesced into the field of strategic
process research.25 One group focused on the structure of decision-making processes: their primary stages, and whether stages
followed one another logically and in sequence or varied over time with the type of decision.26 The goal was a model of the decision
process, replete with flow charts and time lines, that mapped the sequence of steps in decision making and identified ideal types. For
the most part, the results of these studies have been equivocal. Efforts to produce a simple linear flow model of decision making — in
the same way that work processes can be diagrammed using process flow charts — have had limited success. Witte, for example,
studied the purchase process for new computers and found that very few decisions — 4 of 233 — corresponded to a standard, five-
phase, sequential process. He concluded that simultaneous rather than sequenced processes were the norm: “We believe that human
beings cannot gather information without in some way developing alternatives. They cannot avoid evaluating these alternatives
immediately, and in doing this, they are forced to a decision. This is a package of operations.”27 Mintzberg et al. and Nutt, in their
studies of strategic decision making, found it equally difficult to specify a simple sequence of steps.28 After developing general
models of the process, they identified a number of distinct paths through them, each representing a different type or style of decision
making.
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A second group of scholars adopted a more focused approach. Each studied a particular kind of decision, usually involving large
dollar investments, to identify the constituent activities, subprocesses, and associated management roles and responsibilities, as well as
the contextual factors shaping the process. Much of this research has examined the resource allocation process, with studies of capital
budgeting, foreign investments, strategic planning, internal corporate venturing, and business exit.29 This research has led to two
important insights:
First, it has forced scholars to acknowledge the simultaneous, multilevel quality of decision processes. While sequential stages can be
specified, they are incomplete as process theories and must be supplemented by detailed descriptions of the interaction of activities,
via subprocesses, across organizational levels and through time. Bower, for example, identified three major components of the
resource allocation process — definition (the development of financial goals, strategies, and product-market plans), impetus (the
crafting, selling, and choice of projects), and determination of context (the creation of structures, systems, and incentives guiding the
process) — and then went on to describe the linkage among these activities and the interdependent roles of corporate, divisional, and
middle managers.30 A simple stages model was unable to capture the richness of the process: the range of interlinked activities, with
reciprocal impacts, that were unfolding at multiple organizational levels. This finding has obvious implications for managers because
it suggests that effective resource allocation — as well as most other types of decision making — requires attention to the perspectives
and actions that are unfolding simultaneously above and below one’s level in the organization.
Second, this body of research focused attention on the way that managers shape and influence decision processes. By describing the
structural and strategic context — the rules by which the game is played, including the organization’s goals, values, and reward
systems — and showing how it is formed through actions and policies, scholars have demonstrated how senior managers are able to
have a pronounced impact on decisions made elsewhere in the organization. While behavioral processes like decision making have
great autonomy and persistence, they can, according to this line of research, be shaped and directed by managerial action.
Another stream of research has explored the quality of decision making. Scholars have studied flawed decisions to better understand
their causes, examined the factors supporting speedy decision making, and contrasted the effectiveness of comprehensive and narrow
decision processes.31 These studies have noted certain distinctive problems that arise because organizational decision making is a
collective effort. Janis, for example, citing foreign policy debacles such as the Bay of Pigs, noted that when members of a decision-
making group want to preserve social cohesion and strive for unanimity, they may engage in self-censorship, overoptimism, and
stereotyped views of the enemy, causing them to override more realistic assessments of alternatives.32 However, certain techniques
that introduce conflict and dissent, such as devil’s advocacy and dialectical inquiry, have been found to overcome these problems in
both controlled experiments and real-world situations.33
After the Bay of Pigs fiasco, President Kennedy explicitly reformed the national security decision-making process to include devil’s
advocacy and dialectical inquiry, and used both techniques to great effect during the Cuban Missile Crisis.34 Similarly, Bourgeois and
Eisenhardt found that successful, speedy decision making relied on rational approaches, the development of simultaneous multiple
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alternatives, and the use of up-to-date operating information to form judgments.35 For managers, the implications of this line of
research should be obvious: the need to introduce healthy conflict and competing perspectives to ensure more effective, timely
decision making.
Together, these studies have shown that decision-making processes are lengthy, complex, and slow to change. They involve multiple,
often overlapping stages, engage large numbers of people at diverse levels, suffer from predictable biases and perceptual filters, and
are shaped by the administrative, structural, and strategic context. Their effectiveness can be judged, using criteria such as speed,
flexibility, range of alternatives considered, logical consistency, and results, and they are subject to managerial influence and control.
Perhaps most important, these studies have shown that decision making, like other behavioral processes, can be characterized along a
few simple dimensions that managers can review and alter if needed. A company’s decision-making processes may be slow or fast,
generate few or many alternatives, rely primarily on operating or financial data, engage few or many organizational levels, involve
consensual or hierarchical resolution of conflicts, and be tolerant of or closed to divergent opinions.
Communication Processes. Social psychologists and sociologists have long studied communication processes, dating back to the
original human relations experiments at the Hawthorne Works of Western Electric, the pioneering studies of Kurt Lewin, and the
efforts of the National Training Laboratories to establish the field of organizational development.36 The field currently covers a broad
array of processes and interactions, including face-to-face, within-group, and intergroup relationships.
The efficacy of these relationships invariably rests on the quality and richness of interpersonal communication and information
processing activities: how individuals and groups share data, agree on agendas and goals, and iron out conflicts as they go about their
work.37 These processes frequently become patterned and predictable. But because they are embedded in everyday work flows, they
are not always immediately apparent. Like decision-making processes, they reflect unconscious assumptions and routines and can
often be identified only after repeated observations of individuals and groups. Moreover, the underlying processes are quite subtle, as
Schein has observed:
“Many formulations of communication depict it as a simple problem of transfer of information from one person to another. But … the
process is anything but simple, and the information transferred is often highly variable and complex. We communicate facts, feelings,
perceptions, innuendoes, and various other things all in the same ‘simple’ message. We communicate not only through the spoken and
written word but through facial expressions, gestures, physical posture, tone of voice, timing of when we speak, what we do not say,
and so on.”38
Because of these complexities, communication processes are best characterized along multiple dimensions. Schein has provided a
relatively complete set of categories, including frequency and duration, direction, triggers and flow, style, and level and
depth.39 Some patterns can be captured through the tools of communication engineering, which model communication networks and
present a picture of a group’s information linkages and flows in the same way that work processes are often mapped.40
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A few studies have pursued an intermediate level of analysis, combining activities into subprocesses. These subprocesses fall into two
distinct categories: those needed for task management and work accomplishment and those for building the group and maintaining its
relationships.41 Examples of the first include information giving and seeking and opinion giving and seeking, and examples of the
second include harmonizing and compromising. Several scholars have used these categories to develop simple self-assessment forms
for evaluating group processes and have then linked the results to group effectiveness.42
Together, these studies provide a relatively complete set of categories for diagnosing and evaluating communication processes. Like
decision-making processes, they can be characterized along a few simple dimensions. Here, too, managers can use the dimensions to
profile their organizations and identify areas needing improvement. The nature, direction, and quality of discussion flows are
important, as are the interrelationships among group members, their stances toward one another, and the tenor and tone of group work.
Organizational Learning Processes. A wide range of scholars, including organizational theorists, social psychologists,
manufacturing experts, and systems thinkers have studied organizational learning processes.43 There is broad agreement that
organizational learning is essential to organizational health and survival, involves the creation and acquisition of new knowledge, and
rests ultimately on the development of shared perspectives (often called “mental models”). Most scholars have described these
activities abstractly, without trying to group or categorize them. But there are persistent underlying patterns. The way an organization
approaches learning is as deeply embedded as its approaches to decision making and communication.44
Four broad processes are involved: knowledge acquisition, interpretation, dissemination, and retention. In each area, companies appear
to rely on relatively few approaches that fit their cultures and have been adapted to their needs. Over time, these approaches become
institutionalized as the organization’s dominant mode or style of learning. According to Nevis et al.: “Basic assumptions about the
culture lead to learning values and investments that produce a different learning style from a culture with a different pattern of values
and investments.”45
Knowledge, for example, may be acquired in many ways. Each approach involves distinctive tools, systems, and behaviors and is
associated with a particular learning style. The underlying processes differ accordingly. Companies like DuPont have focused their
efforts on brainstorming and creativity techniques; others, like Boeing and Microsoft, have become adept at learning from their own
internal manufacturing and development experiences. AT&T and Xerox have gained considerable skill at benchmarking competitors
and world leaders; others, like Royal Dutch/Shell, have used hypothetical planning exercises to stimulate learning. Similar distinctions
exist for the processes of knowledge interpretation, dissemination, and retention. Retention, for example, may be through written
records or tacitly understood routines, and the organization’s memory may be accessed by a range of indexing and retrieval
processes.46
Organizational learning processes thus share many of the same characteristics as decision-making and communication processes.
Activity is distributed throughout the organization, unfolds over time, involves people in diverse departments and positions, and rests
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on a few critical subprocesses or routines. It too is “an organizational process rather than an individual process” and can be classified
into distinctive modes or styles.47 In fact, when combined together, the three behavioral processes are often complementary and
synergistic.
They interact in predictable ways, producing clusters of characteristics that are mutually reinforcing.
In the microcomputer industry, for example, the most effective firms were able to make quick decisions.48 Their ability to do so
rested on several mutually reinforcing activities. Decision making was rational and analytical, based on multiple alternatives and real-
time operating information. Communication was open and wide ranging, with discussions that relied on shared ideas, pooled
information, and the judgment of a few trusted counselors, but vested final authority with the CEO. Organizational learning was
guided primarily by external scanning and search. There is an important message here for managers. Just as administrative and
operational processes must be complementary and supportive, so too must behavioral processes.
Unfortunately, managers frequently assume that restructuring or reengineering work processes will be accompanied by simultaneous,
virtually automatic changes in behavior. Such changes are usually considered essential for successful transformations.49 But because
they reflect deeper forces, these behaviors normally remain in place unless the underlying processes are tackled explicitly. Managers
must recognize that successful improvement programs require explicit attention to the organization’s characteristic patterns of
decision making, communication, and learning. Tools for stimulating change include simulations, exercises, observations, and
coaching; each may be applied at the individual and organizational levels.

Change Processes

The change process approach, which has roots in strategic management, organization theory, social psychology, and business history,
focuses on sequences of events over time. These sequences, called processes, describe how individuals, groups, and organizations
adapt, develop, and grow. Change processes are explicitly dynamic and intertemporal. Unlike the relatively static portraits of work and
behavioral processes, they attempt “to catch reality in flight.”50 Examples of change processes include the organizational life cycle
and Darwinian evolution.
All change processes share several characteristics. They are longitudinal and dynamic, designed to capture action as it unfolds, with
three components always present: “a set of starting conditions, a functional end-point, and an emergent process of change.”51 Change
processes therefore answer the question, “How did x get from here to there?” Often, a story or narrative is required to provide
coherence and explain the underlying logic of the process.52 Most descriptions of change also divide time into broad stages or phases.
Each stage consists of groups of activities aimed at roughly similar goals, and the transition between stages may be smooth or
turbulent.53
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Studies of change have focused on four broad areas: creation, growth, transformation, and decline.54 Each period represents a critical
stage in the individual or organizational life cycle, and, over time, the life cycle has become the organizing framework for the field.
Scholars remain divided, however, about the pattern and flow of events over time. The primary question is whether change processes
proceed through incremental steps — what Gersick has called “a slow stream of small mutations” — or through alternating periods of
stability and revolutionary change.55Ultimately, the choice is between traditional Darwinian theories and those based on a newer,
punctuated equilibrium framework. While the subject is still under debate, evidence supporting the latter view is accumulating
rapidly.56
Whatever their focus, change processes fall into two broad categories: autonomous and induced. Autonomous processes have a life of
their own; they proceed because of an internal dynamic. The entity or organism evolves naturally and of its own course. In some
cases, the direction of change is preordained and inevitable. In others, transitional periods create flux, and the entity may evolve in
multiple, unexpected ways. Processes in the former category include an organization’s evolution from informal, entrepreneurial start-
up to a more structured, professionally managed firm. Processes in the second category include organizational and industry shifts that
result from revolutionary changes in technology.57 In both cases, Selznick has observed, managers must be attentive to the path and
timing of development: “Certain types of problems seem to characterize phases of an organization’s life-history. As these problems
emerge, the organization is confronted with critical policy decisions.”58 Appropriate action depends, in large part, on fitting behavior
to the conditions and requirements of the current stage.59 An obvious example is knowing when to introduce policies, procedures, and
systems into a loosely knit, entrepreneurial firm. Too early, and growth may be stifled; too late, and the organization may already have
spun out of control.
Unlike autonomous processes, induced processes do not occur naturally but must be created. All planned change efforts therefore fall
into this category. While they are triggered in different ways, such efforts, once underway, unfold in a predictable sequence. Each step
is accompanied by distinctive challenges and tasks, with striking parallels in different theorists’ descriptions. Induced change
processes are commonly divided into three basic stages.60 The first is a period of questioning, when the current state is assessed and
energy applied to dislodge accepted patterns. The second stage is one of flux, when old ways are partially suspended and new
approaches are tested and developed. The third is a period of consolidation, when new attitudes and behaviors become
institutionalized and widely adopted. Again, it is critical that managers develop actions appropriate to the current stage and know
when it is time to shift to a new stage. Examples of three-part theories include Beckhard and Harris’s present state, transition state, and
future state; Lewin’s and Schein’s unfreezing, changing, and refreezing; and Tichy and Devanna’s awakening, mobilizing, and
reinforcing.61
We can thus classify change processes on a few simple dimensions: they may be autonomous or induced, and involve slow
incremental evolution or alternating periods of stability and revolutionary change. Complete process descriptions also include the
precise sequence, duration, and timing of stages, as well as the nature and number of activities and participants at each stage.62
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A Recap of Organizational Processes

The three major approaches to organizational processes have much in common (see “An Organizational Processes Framework”). Each
views processes as collections of activities, involving many people, that unfold over time. Each involves repeated, predictable
sequences or patterns. And each takes a holistic approach, grouping individual activities and decisions in coherent, logical ways. The
latter quality is especially important because it suggests that processes provide managers with a powerful integrating device, a way of
meshing specialized, segmented tasks with larger organizational needs.
An Organizational Processes Framework

WORK PROCESSES BEHAVIORAL PROCESSES CHANGE PROCESSES

Definition • Sequences of activities that • Widely shared patterns of behavior and ways • Sequences of events over time
transform inputs into outputs of acting/interacting

Role • Accomplish the work of the • Infuse and shape the way work is conducted • Alter the scale, character, and
organization by influencing how individuals and groups identity of the organization
behave

Major • Operational and administrative • Individual and interpersonal • Autonomous and induced,
Categories incremental and revolutionary

Examples • New product development, • Decision making, communication, • Creation, growth,

order fulfillment, strategic
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WORK PROCESSES BEHAVIORAL PROCESSES CHANGE PROCESSES

planning organizational learning transformation, decline

Despite these similarities, the three types of processes capture different organizational phenomena and are best viewed as
complementary pieces of a larger puzzle. They can, in fact, be combined into a single framework that includes both cross-sectional
and dynamic elements. (For a unified portrait of organizations as collections and reflections of processes, see “A Diagram of
Organizational Processes.”)
A Diagram of Organizational Processes

A process view of organizations offers several advantages. First, it provides a disaggregated model of the firm, but does so in ways
that make the analysis of implementation more tractable and explicit. Put another way, if organizations are “systems for getting work
done,”63 processes provide a fine-grained description of the means. Second, the diagram suggests the intimate connections among
different types of processes and the futility of analyzing them in isolation. It is extraordinarily difficult — and, at times, impossible —
to understand or alter a single process without first taking account of others on which it depends.64
Perhaps most important for managers, a process view of organizations changes the focus of both analysis and action. All too often,
managers’ first response to problems is to pin responsibility on an individual or department. Yet because processes shape the vast
majority of organizational activities, they are frequently the true sources of difficulty. Accountability must therefore shift to a higher
level: to those with wide enough spans of control to oversee entire processes. This principle has long been a staple of the quality
movement, where it has been applied to operational processes. The preceding arguments suggest that managers need to be equally
attentive to administrative, behavioral, and change processes. As a general rule, responsibility for these processes must shift to senior
members of the firm.
Approaches to organization design must change as well. Most texts on the subject focus on tasks and structures, with detailed
discussions of roles, positions, levels, and reporting relationships.65They say relatively little about processes or about how the work
actually gets done. The implicit argument seems to be that organization design is largely a matter of architecture: drawing the right
boxes and connecting them appropriately. A process perspective suggests that far more attention should be paid to organizational
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functioning, and that design efforts should begin by attending to processes and only later should shift to the structures needed to
accommodate them.
Finally, this approach suggests that managers are continually enmeshed in organizational processes. The result is a delicate balancing
act. On the one hand, managers are constrained by the processes they face, forced to work within their boundaries and preestab-lished
steps to get things done. On the other hand, they try to influence and alter these processes to gain advantage. This continual shifting
from “statesman” to “gamesman” is what makes management such a challenging task.66 It also suggests another, quite different use
of the word processes.

Managerial Processes

Management is often described as the art of getting things done. But because organizations are complex social institutions with widely
distributed responsibility and resources, unilateral action is seldom sufficient.67 Managers therefore spend the bulk of their time
working with, and through, other people.68 They face a range of challenges: how to get the organization moving in the desired
direction, how to gain the allegiance and support of critical individuals, and how to harmonize diverse group interests and goals. In the
broadest sense, these are questions of process: they involve how things are done, rather than the content or substance of ideas or
policies.
The mechanics of implementation thus lie at the heart of this definition of processes. The focus is on the way that managers
orchestrate activities and events and engage others in tasks so that desired ends are realized (see “Descriptions of Managerial
Processes”). Action is the key, and process is implicitly equated with skilled professional practice. Not surprisingly, this use of the
term appears in a wide range of professions where there is need for artistry, subjectivity, and careful discriminations. Architects, for
example, engage in the design process; scientists employ the scientific process; and psychologists engage in the counseling process.
Like management, each activity involves complex, contingent choices about how best to transform intentions into results.
Descriptions of Managerial Processes
• “Managing is a social process. It is a process because it comprises a series of actions that lead to the accomplishment of objectives. It
is a social process because these actions are principally concerned with relations between people.”
W.H. Newman, C.E. Summer, and E.K. Warren, The Process of Management (Englewood Cliffs, New Jersey: Prentice-Hall, 1972), p.
12.
See more
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Managerial processes, however, involve additional complications. Many scholars agree that “organizations … are fundamentally
political entities,”69 composed of diverse groups with their own interests that come into conflict over agendas and resources.70 In
such settings, successful managers must align and harmonize competing interests, while cultivating commitment and motivation.
Skillful managers therefore spend relatively little time issuing ultimatums or making big decisions. Rather, they engage in an
extraordinary number of fragmented activities, tackling pressing issues or small pieces of larger problems.71 Often, the process
requires building and using interpersonal networks, as well as “skillful maneuvering” to overcome political obstacles.72
The challenge for managers, then, is to shape, prod, and direct their organizations, through words and deeds, so that larger goals are
realized. The approaches they use — which were once the subject of courses on administrative practice — are managerial processes.
They have an underlying logic that is easily missed when scholars focus on taxonomies of discrete tasks and activities, rather than
unifying threads.73 Moreover, because these processes require flexibility and a sensitivity to context, they seldom unfold in the same
set sequence or maintain the same character on every occasion.74
Empirical studies of managerial processes fall into two broad categories. One group has taken an anthropological approach focusing
on a single manager in action, with vivid descriptions of his or her behavior. Case studies in business policy fall into this category, as
do studies by insiders or journalists who have gained unusual access to a company.75 The associated processes have usually been
idiosyncratic and highly individualistic, reflecting the distinctive character of the managers studied. Such nuanced, textured
descriptions provide invaluable insight into the processes of management but permit few generalizations.
A second group of empirical studies, usually by scholars, has sought broader conclusions. Typically, they have reviewed the time
commitments and activities of a few managers, grouped them into categories according to purposes and goals, and then applied a
process perspective. Three broad processes have dominated this literature: direction setting, negotiating and selling, and monitoring
and control.

Direction-Setting Processes

Direction setting, the most widely recognized managerial activity, has appeared, in some form, in most empirical studies of managerial
work.76 It involves charting an organization’s course and then mobilizing support and ensuring alignment with stated goals. Kotter’s
description of how general managers met this challenge is representative.77 All the managers he studied began by developing an
agenda, collecting information from a wide range of sources, and then assimilating it and forming a few broad thrusts or general goals.
They then worked hard to frame messages, using diverse communication media and opportunities, to ensure that members of the
organization developed a shared understanding of the new objectives. Often, these activities occurred within the broad parameters of
the organization’s planning or goal-setting process, although much work was informal and unstructured, tailored to the unique skill of
the manager and the distinctive demands of the situation. Gabarro and Simons reached similar conclusions in their studies of the
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“taking charge” process of new executives, where individualized managerial action was coupled with established organizational
processes.78
Together, these empirical studies have shown that direction-setting processes have several components: learning about the
organization and its problems through a broad range of interactions, assessments, and continued probing; framing an agenda to be
pursued during the manager’s tenure through conscious reflection and intuitive experience; and aligning individuals through
communication, motivation, rewards, and punishments, often using new or established organizational processes. Critical process
choices that the manager makes include which information sources to tap, which communication media and supporting systems to
emphasize, and which approaches to use in framing, testing, and revising initiatives.

Negotiating and Selling Processes

Once the manager sets a direction, negotiating and selling processes are necessary for getting the job done. They work in two
directions, horizontally and vertically. Because horizontal flows link the activities of most departments, employees frequently rely on
individuals outside their work groups for essential services and information.79 Formal authority is normally lacking in these
relationships, and managers must use other means to gain cooperation. This usually requires building a network of contacts and then
working with the appropriate individuals to negotiate the “terms of trade” for current and future interactions.80 Various approaches
are used to gain support, including currying favor, creating dependence, providing quid pro quo’s, and appealing to compelling
organizational needs.
Successful negotiating requires an understanding of “the strengths and weaknesses of others, the relationships that are important to
them, what their agendas and priorities are.”81 Issues must be shaped and presented in ways that are palatable to individuals and
groups with differing interests and needs. Sayles, who has conducted the most extensive research on these processes, noted that they
usually began with “missionary work,” in which potential buyers and sellers were identified for possible future use.82 A surprising
range of contacts was necessary because horizontal relationships fell into so many different categories. All, however, required skilled
salesmanship: the ability to interest outsiders in a project, gain exceptions from staff groups, and convince support specialists to invest
time and resources. For this reason, the most critical process choices involved framing and presentation: deciding how to solicit help
and present proposals in ways that appealed to others yet met one’s basic objectives.
Selling is also required in a vertical direction. Middle managers must normally convince their superiors of the value of their proposals
if they hope to see them enacted; to do so, they frame projects to highlight urgency and need, bundle them in ways that increase the
likelihood of acceptance, and assemble coalitions to provide credibility and support.83 This activity is not confined to middle
managers. Chief executives engage extensively in selling, for it is often the only way they can gain acceptance of their strategies and
plans.84
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Monitoring and Control Processes

Once operations are underway, managers engage in a third set of processes, designed to ensure that their organizations are performing
as planned. Such oversight activities are necessary because business environments are inherently unstable; they generate any number
of unexpected shocks and disturbances. Monitoring and control processes detect perturbations, initiate corrective action, and restore
the organization to its previous equilibrium.85 Typically, managers begin with efforts to sense problems and formulate them clearly,
followed by probes to clarify the problems’ precise nature and underlying causes.86 They collect information through their own
contacts, others’ contacts, observation, and reviews of records.87 At times, they use formal organizational processes, like variance
reporting; more often, effective monitoring is nonroutine and conducted as part of other, ongoing interactions.88 Here, critical process
choices include the information sources to tap, the data to request, the questions to pose, and the amount of time to allow before
drawing conclusions and initiating corrective action.

Recapping Managerial Skills

These three processes have different purposes, tasks, and critical skills (see “A Managerial Processes Framework”). Although most
managers treat them as distinct challenges, at a deeper level, they have much in common. All depend on rich communication, pattern
recognition, a sensitivity to relationships, and an understanding of the organization’s power structure. Perhaps most important, all
managerial processes involve common choices about how to involve others and relate to them as the organization moves forward.
They are the essence of the manager’s craft and can be applied equally effectively to direction setting, negotiating and selling, and
monitoring and control.
A Managerial Processes Framework

DIRECTION-SETTING NEGOTIATION AND SELLING MONITORING AND CONTROL

PROCESSES PROCESSES PROCESSES

Purpose • Establish organizational direction • Obtain needed support and resources • Track ongoing activities and
and goals performance
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DIRECTION-SETTING NEGOTIATION AND SELLING MONITORING AND CONTROL

PROCESSES PROCESSES PROCESSES

Primary • Developing an agenda • Building a network • Collecting information

task

Critical • Synthesis, priority setting, • Timing and sequencing, framing and • Questioning and listening, interpreting
skills communication presentation data

The variables are few, but the combinations are virtually limitless. Whatever the issue, all managerial processes involve six major
choices that a manager must make:
1. Participants (Whose opinions should I seek? Whom should I invite to meetings? Who should participate in task forces? Which
groups should be represented?)
2. Timing and sequencing (Whom should I approach first? Whom should I invite next? Which agreements should I solicit before
others? How should I phase events over time?)
3. Duration (How much time should I devote to information collection? How much time should I give to individuals and groups for
their assignments? How should I pace events to build momentum?)
4. Framing and presentation (How should I describe and interpret events? How should I heat up issues or cool them down? How
should I frame proposals for superiors, subordinates, and peers? What questions should I ask to gain information?)
5. Formats (Should I make requests in person or over the phone? Should I communicate information through speeches, group
meetings, or face-to-face encounters?)
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6. Style (How should I induce others to cooperate? How should I utilize and distribute rewards and punishments? What tone should I
take when dealing with superiors, subordinates, and peers?)
There are many possible answers. This variety helps explain why management, like many other professions, continues to be more an
art than a science.89 In the face of massive uncertainty, managers must make complex choices with few precedents or guidelines; the
resulting processes seldom repeat themselves exactly. Moreover, seemingly minor variations in processes can have major impacts.
Changes in sequencing, with one critical individual or department contacted before another, or shifts in format, with written
memoranda replacing face-to-face meetings, often produce dramatically different coalitions and results.90 The subtlety of these
distinctions, plus the enormous range of possibilities, is what makes managerial processes so difficult to master. But, by thinking in
process terms, managers are much more likely to link together their activities to produce the desired ends.

Implications for Action

The process perspective fills an important gap. Most research on organizations either employs highly aggregated concepts like strategy
or focuses on low-level tactics and tasks. Researchers often ignore the middle ground. Processes, by contrast, are intermediate-level
concepts that combine activities into cohesive wholes, yet offer a fine-grained, differentiated perspective. They are also inherently
dynamic. Because processes unfold over time, they capture linkages among activities that are often lost in static models and cross-
sectional analyses. A process approach encourages thinking in story lines rather than events; the appropriate metaphor is a movie
rather than a snapshot.91
For this reason, the approach is unusually helpful in addressing implementation problems. Managers can articulate the required steps
in a process, as well as improvements. By contrast, traditional lists of roles and responsibilities leave the associated activities
unspecified or undefined. Job descriptions framed in process terms should therefore make it easier for untrained individuals to step
into new jobs and acquire necessary skills.92 Managers should be able to focus their questioning of peers and subordinates on issues
more directly related to the organization’s operation.93 And a sensitivity to processes should give managers clearer guidelines about
how and when to intervene effectively in others’ work.94
We can combine the major organizational and managerial processes into a simple, integrating framework (see “A Framework for
Action”). The framework consists of diagnostic questions that allow managers to assess the effectiveness of their, and their
organization’s, approaches to action. For example, the question “Is there a clear rationale, direction, and path of change?” asks
managers to determine whether direction has been set effectively for a particular change process. Similarly, the question “Have we
obtained the necessary agreements and resources from upstream and downstream departments?” assesses whether negotiation and
selling have been conducted effectively for a given work process. Together, the questions provide a reasonably complete framework
for evaluation.
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A Framework for Action

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The framework has two primary uses:

First, it can help managers decide where, when, and how to intervene in their organization’s activities. To do so, they should work
down the columns of the matrix, asking each question in turn to isolate the likely source of difficulties and identify appropriate
remedial actions. Consider, for example, a company experiencing customer service problems. Because customer service is an
operational (work) process, the questions in the first column provide guidance. If the answers suggest that problems can be traced to
unclear goals, managers need to invest time in setting and clarifying objectives. If the problems reflect a lack of support from
upstream designers and manufacturing personnel, managers need to devote time to cross-departmental negotiations and salesmanship.
If the problems signify slow, limited customer feedback, managers need to upgrade the processes for monitoring and collecting
information.
Managers can use the same approach for less tangible processes like decision making. Suppose that decision making is currently
parochial and unimaginative, and managers have decided to improve the process by encouraging dissent and constructive conflict.
Progress, however, has been slow. Because decision making is a behavioral process, managers should use the questions in the second
column to diagnose the problem. If the answers suggest that difficulties can be traced to unclear concepts (e.g., “We don’t know how
to distinguish constructive from unproductive conflict”), managers should focus on improved direction setting. If the difficulties
reflect underlying disagreements about the appropriateness of the desired behaviors (e.g., “We are a polite company and see no reason
to argue with one another”), managers should focus on selling the new approaches. If the difficulties are caused by poor awareness of
current practices (e.g., “We don’t need to do anything differently because we already entertain diverse viewpoints and debate issues in
depth”), managers need sharper real-time feedback and monitoring. Here, too, the matrix provides managers with a powerful lens for
identifying the underlying sources of problems and for framing responses in process terms.
Second, the matrix helps managers identify their personal strengths and weaknesses. Because direction setting, negotiation and
selling, and monitoring and control are very different processes, few managers are equally adept at all three. One way to identify areas
needing work is for managers to proceed across the rows of the matrix, asking the relevant diagnostic questions about diverse
organizational activities.
For example, to assess direction-setting skills, a manager might look at a number of operational processes under his or her control to
see if clear goals have been established, might review a variety of decision-making and communication processes to see if preferred
approaches were clearly described and understood, and might assess several current change initiatives to see if the rationale, direction,
and paths of change were clear. A series of “no’s” in a row means that the manager needs to improve direction setting. As with the
previous assessments of organizational processes, managers can conduct these evaluations working alone in their offices, teams of
executives responsible for related projects or programs can work in groups, or entire departments or units can work collectively. In
general, the size of the evaluating group should correspond to the scope of the process under review, and the larger the group, the
more likely that formal approaches to data collection such as surveys, questionnaires, and diagnostic scales will be needed.
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Clearly, a process perspective has much to offer. It sheds light on many pressing questions of organization and management while
providing a number of practical guidelines. Here I present a starting point, a taxonomy and frameworks for defining, distinguishing,
and classifying the major types of processes. Used wisely, they will improve managers’ ability to get things done.
Controlling Function of Management

What is Controlling?

Controlling consists of verifying whether everything occurs in confirmities with the plans adopted, instructions issued and principles
established. Controlling ensures that there is effective and efficient utilization of organizational resources so as to achieve the planned
goals. Controlling measures the deviation of actual performance from the standard performance, discovers the causes of such
deviations and helps in taking corrective actions

According to Brech, “Controlling is a systematic exercise which is called as a process of checking actual performance against the
standards or plans with a view to ensure adequate progress and also recording such experience as is gained as a contribution to
possible future needs.”

According to Donnell, “Just as a navigator continually takes reading to ensure whether he is relative to a planned action, so should a
business manager continually take reading to assure himself that his enterprise is on right course.”

Controlling has got two basic purposes

1. It facilitates co-ordination
2. It helps in planning

Features of Controlling Function

Following are the characteristics of controlling function of management-

1. Controlling is an end function- A function which comes once the performances are made in confirmities with plans.
2. Controlling is a pervasive function- which means it is performed by managers at all levels and in all type of concerns.
3. Controlling is forward looking- because effective control is not possible without past being controlled. Controlling always
look to future so that follow-up can be made whenever required.
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4. Controlling is a dynamic process- since controlling requires taking reviewalmethods, changes have to be made wherever
possible.
5. Controlling is related with planning- Planning and Controlling are two inseperable functions of management. Without
planning, controlling is a meaningless exercise and without controlling, planning is useless. Planning presupposes controlling
and controlling succeeds planning.

Control: A Function Of Management That Prevents The System From Failing

Function 4 of Management

Take a step back now... Can you see, in full view, the tireless work involved in good management? Many think, now is the time to
relax; I doubt that Ray Kroc ever thought that. The minute you let your guard down, a bit of control is lost, motivation drops below
sea level, organization slips a bit, and a plan becomes dusty and forgotten.

Do not think for one minute that the job of management is ever complete.

Continual evaluation of a plan under-way results in controlling the plan and the organization of that plan. All angles must be viewed
and reviewed. Feedback from those involved is crucial for the validity of the pursued direction. Charted progress and weighed
achievement is a necessity when review is in full swing. Structured meetings of the many minds such as cross-functional teams,
executive leadership, and departmental kumbayas become the display case for project and/or product analysis. These essential
gatherings chart time and development, as well as reveal shortfalls in predetermined timelines, budgets, or sightedness.

Controlling the spin of any project controls the potential for failure or missed marks.

This function — the function of Control — allows for resolution and change that is compulsory. How is it that nearly 90 percent of all
technology startups fail? Poor management! Think about it, poor management results in failed businesses, lost capital, time vanished,
and considerable heartache. Eighty percent of all start-ups fail by year five. That is a considerable amount of time invested in a
project, business, or department. How is this possible? The answer is still poor management.

Let’s talk a bit about poor management. CEOs, directors, or ,anagers are responsible for managing the resources, namely people and
money. If a manager fails to properly manage an employee, he fails the system. If a CEO/president fails to manage the capital, he fails
the system. If an employee fails to meet a deadline or falls into bad habits (like overspending), the system fails, not just the employee.
The parts are all interrelated. It is a system.
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Mismanagement of Money and/or Mismanagement of People = System Failure.

Control. This follows the plan, is preceded by the organization, and is in line behind directing/motivating. Crisis prevention and issue
aversion are part of the ongoing process of management: this doesn’t have an end date. Marketing Projects, Product Development,
Sourcing and Recruitments or Staffing assignments may have deadlines or necessary completion dates but the “business” does not.

You are only as good as your last project.

When you hit a stumbling block, recall these basic functions.

1. Did you plan well, enough?
2. Did you carry out the plan?
3. Was there impetus to drive completion?
4.Were the steps monitored and controlled?
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