MG8591-PRINCIPLES OF MANAGEMENT

UNIT I INTRODUCTION TO MANAGEMENT AND ORGANIZATIONS

Definition of Management – Science or Art – Manager Vs Entrepreneur - types of managers -

managerial roles and skills – Evolution of Management – Scientific, human relations,
system and contingency approaches – Types of Business organization - Sole proprietorship,
partnership, company-public and private sector enterprises - Organization culture and
Environment – Current trends and issues in Management.
Part-A

1. Define: Management.(APRIL/MAY 2019)

According to KOONTZ & WEIHRICH, “Management is the process of designing and
maintaining of an environment in which individuals working together in groups efficiently
accomplish selected aims”.
“Management is the art of getting things through and with people in formally organized
groups”.
Ex: Human Resource Management, Financial Management.
2. Write the meaning for entrepreneur. (APRIL/MAY 2019)
Entrepreneurship is the process of designing, launching and running a new
business, which is often initially a small business. Entrepreneurship has been described as
the "capacity and willingness to develop, organize and manage a business venture along
with any of its risks to make a profit."
3. What are the roles played by a Manager? (APRIL/MAY 2018)
Interpersonal roles
1. Figurehead role
2. The leader role
3. The liaison role
Informational roles
4. The recipient role
5. The disseminator role
6. The spokesperson role
Decision roles
7. The entrepreneurial role
8. The disturbance-handler role

Dr.P.T.Kalaivaani, HOD/ECE & T.Raja,AP/ECE MG8591- PRINCIPLES OF MANAGEMENT(Unit-I)

9. The resource allocator role
4. Distinguish between public company and private company. (APRIL/MAY 2018)
S.NO PUBLIC COMPANY PRIVATE COMPANY
1 A Private company has "Pvt.Ltd" at A Public company has "Ltd" at the end of
the end of its name. its name.
2 The minimum number of members The minimum number of members needed
needed to form a private company is to form a Public Company is at least 7
at least 2 members. members.
3 The Maximum number of members The Public Company has no restriction on
in a Private Company is restricted to a maximum number of members.
200.
4 Private Company should have a Public Company should have a minimum
minimum paid up capital of 1 lakh paid up capital of 5 lakh rupees.
rupees.
5 Commencement of business of a A Public Company can only Commence its
Private Company takes place business after receiving a certificate of
immediately after getting the incorporation and Certificate to
certificate of incorporation. commencement.
6 A Private Company must have at A Public Company must have at least 3
least 2 directors to head and directors to manage and lead the affairs of
supervise the affairs of the company. the company.
7 A Private Company cannot issue a Public Company can issue a Prospectus.
Prospectus. Private Company is not Public Company is free to invite public for
allowed for inviting the public for subscription of its shares.
subscription of its shares.
8 A Private Company can allot shares A Public Company cannot be able to allot
without waiting for the completion of shares before the minimum subscription of
minimum subscription limit. shares is completed.

5. What Organisational culture means? (APRIL/MAY 2017)

Organizational culture is a system of shared assumptions, values, and beliefs,
which governs how people behave in organizations. These shared values have a strong

Dr.P.T.Kalaivaani, HOD/ECE & T.Raja,AP/ECE MG8591- PRINCIPLES OF MANAGEMENT(Unit-I)

 influence on the people in the organization and dictate how they dress, act, and perform
their jobs.
6. Define Partnership.(NOV/DEC 2017)
A legal form of business operation between two or more individuals who share
management and profits. The federal government recognizes several types
of partnerships. The two most common are general and limited partnerships. One of the
major advantages of a partnership is the tax treatment it enjoys.
7. What are the essential skills of Managers? (APRIL/MAY 2018)
The major skills required or expected out of managers are:-
Technical skills – Pertaining to knowledge and proficiency in activities involving
methods and procedures;
Human skills – Ability to work effectively with other persons and to build up cooperative
group relations to accomplish organizational objectives;
Conceptual skills – Ability to recognize significant elements in a situation; and to
understand the relationship among those elements; and
Design skills – Ability to solve problems in ways that will benefit the enterprise.
8. List the contributions of Fayol towards Management.
Henry Fayol is a French industrialist whose contributions are termed as
operational management or administrative management. He followed ’’The Classical
Approach‟ to the evolution of management thought. His contributions are given as
follows:-
• Grouping of activities of an industrial organization into six groups, namely- Technical,
commercial, financial, security, accounting and managerial;
• Identified six types of qualities of a manager are- Physical, mental, moral, educational,
technical and experience;
• Fourteen principles of Management namely- Division of Work, Authority and
responsibility and so on; and
• Five elements/functions of management- Planning, organizing, commanding,
coordinating and controlling.
9. What do you understand by the term ‘Joint Stock Company’?
“By a Company we mean an association of many persons who contribute money or
money‟s worth to a common stock and employs it in some trade or business and also
shares the profit and loss as the case may be arising there from”.

Dr.P.T.Kalaivaani, HOD/ECE & T.Raja,AP/ECE MG8591- PRINCIPLES OF MANAGEMENT(Unit-I)

 There are two types of Joint stock companies:-
* Private Limited company – Ex: M/s Key Media Pvt. Ltd.
* Public Limited company – Ex: M/s Pearl credits Ltd.
10. Who is (i) an active partner (ii) a sleeping partner?
Active partner: Any partner who is authorized by others to manage the business is
known as active partner.
Sleeping partner: Any partner who does not express his intention to participate in the
business can be called as a sleeping partner. He will be just an investor who has a right to share
profits.
11. Give the current trends in management. (NOV/DEC 2017)
The current trends in the organizational change are: globalization, diversity,
flexibility, flat and networks. Globalization: It is the major and current trend in the
organizational change.
List out the Management level and functions.
• Top-level management
• Middle level management
• Lower level management
Top level management functions
1. To formulate goals and policies
2. To formulate budgets
3. To appoint top executives
Middle level management functions.
1. To train motives &develop supervisory level
2. To monitor and control the operations performance
Low level management
1. To train &develop workers
2. To assign job
3. To give orders and instructions
4. To report the information about the workers

12. Define ‘Sole proprietorship’.

A Business unit that is owned and controlled by a single individual is known as sole
trading or sole proprietorship concern. He uses his own savings for running the

Dr.P.T.Kalaivaani, HOD/ECE & T.Raja,AP/ECE MG8591- PRINCIPLES OF MANAGEMENT(Unit-I)

business. The sole trader makes all purchases and sells on his own and maintains all the
accounts. He alone enjoys all the profits and bears all the losses.
Ex: A Fancy store.

13. What do you mean by a ‘Partnership firm’?

A partnership is an association of two or more persons to carry on business and to
share its profit and losses. The relation of a partnership arises from contract. The
maximum number of partners is limited to 10 in the case of banking business and 20 in
the case of other business.
Ex: Chand & Co.

14. What is a Co-operative Enterprise?

A Co-operative enterprise is a voluntary association of persons for mutual benefit
and its aims are accomplished through self-help and collective effort. It may be described
as a protective device used by the relatively less strong sections of society to safeguard
their economic interests in the face of exploitation by producers and sellers working
solely for maximizing profits. Ex: AAVIN Milk Federation Cooperative Society.

15. What is a Private limited company?

A Private limited company is a company which has a minimum paid up capital as
may be prescribed. It can be incorporated with just two persons. It can have a maximum
of 50 members. It cannot go in for a public issue. It restricts the transfer of its shares. It
is particularly suitable for industrial ventures which can get many concessions in respect
of income tax. Ex: M/s Key Media Pvt. Ltd.

16. What is a Public limited company?

A Public limited company should have a minimum of 7 members and the
maximum limit is unlimited. It can issue shares to the Public. The financial statement
should be sent to all the members and to the Registrar of Companies. The shares of a
public limited company can be transferred by the members to the others without any
restriction by the company. Such transfers are made through organized markets called
„stock markets‟ or „stock exchanges‟. Ex: M/s Pearl credits Ltd.

Dr.P.T.Kalaivaani, HOD/ECE & T.Raja,AP/ECE MG8591- PRINCIPLES OF MANAGEMENT(Unit-I)

17. What is a Public sector Enterprise?
Public enterprise or State enterprise is an undertaking owned and controlled by
the local or state or central government. They are financed and managed by the
government. They are started with a service motive. Ex: NLC Ltd.

PART-B
1. Is Management Art or Science? Discuss. (APRIL/MAY 2019)(13 Marks)
 The controversy with regard to the nature of management, as to whether it is an art or a
science, is very old. This controversy, however, is not very much in the air now though
the controversy is yet to be settled.
 It is to be noted that the learning process in art differs from that of science.
 Learning of art involves its continuous practice while learning of science basically
involves the assimilation of principles.
 Much of the controversy of management being as art or science is on account of the
fact that the earlier captains of industry and managers have used intuition, hunches,
commonsense, and experience in managing organizations.
 They were not trained professional managers, although they were very brilliant and
had developed commonsense through which they managed well. However,
commonsense and science differ considerably in solving the problems.
MANAGEMENT AS AN ART
Art is defined as the use of skills to bring a desired result. Skills refer to one’s proficiency
to do a specific work. Thus, art has the following features:
1. Practical Knowledge
 Knowledge refers to possession of facts and techniques of a particular field.
Knowledge can be acquired through study and/or practical experience.
 Generally, in art, more emphasis is given on acquiring knowledge through practical
experience. In management, knowledge is acquired both through study and
experience. Thus, management is an art.
2. Personalized Application of Knowledge
 In art, there is personalized application of knowledge to achieve the desired results.
This is possible because the same set of results can be achieved through a number
of alternative ways.

Dr.P.T.Kalaivaani, HOD/ECE & T.Raja,AP/ECE MG8591- PRINCIPLES OF MANAGEMENT(Unit-I)

  This is done in management too; each manager has his own way of achieving
results. Thus, management is an art.
3. Improvement through Continuous Practice
 In art, improvement is made through continuous practice. This practice eliminates
those activities which are not relevant for achieving the desired results and
improving those activities that are relevant.
 Through this way, the person engaged in any art tends to move towards perfection.
This is exactly done in management.
4. Situational Application
 Art has situational application. This implies that an art which is appreciated in one
situation may not be appreciated in another situation. This is true for management
too.
 Thus, a particular management practice which is quite effective in an organization
may not be effective in another organization because of change in situational
context.
 Further, in the same organization, management practices may change over the
period of time because of change in contextual variables.
5. Emphasis on Creativity
 Art puts emphasis on creativity through which new things or ways of working are
created. This is done in management too; managers create new products, new ways
of working, and new means of financing, new ways of marketing and so on.
The above discussion shows that management is an art.
MANAGEMENT AS A SCIENCE
 Science is a body of systematized knowledge generated through logical consistency,
critical evaluation and experimental study. Thus, science has the following
features:
1. Systematized Body of Knowledge
 Science is a systematized body of knowledge. Its principles are based on cause-
effect relationship, that is, a particular factor has been caused by what factor can
be explained in a definite way.
 For example, if you throw a ball up, after going upward the ball will ultimately
come back on the ground because of earth’s gravitational force.

Dr.P.T.Kalaivaani, HOD/ECE & T.Raja,AP/ECE MG8591- PRINCIPLES OF MANAGEMENT(Unit-I)

  In management, there is lack of such a cause-effect relationship; cause-effect
relationship is defined in flexible way, not in definite way. Thus, management is
not a true science.
2. Principles Based on Experimentation
 In science, principles are evolved on the basis of experiments conducted in
laboratories. Such principles are tested again and again for final approval.
 In management, this is not done in all cases; in many cases, management
principles are based on personal observations and experiences.
 Though experiments are conducted under controlled conditions, their findings are
not tested like science. From this point of view, management is not a true science.
3. Verifiable Principles
 Scientific principles can be verified by any one. Such verification will give the same
results again and again. Management principles are not verifiable in many cases.
 In fact, in many cases, it is difficult to appreciate the bases on which management
principles have been evolved. Thus, management is not a true science.
4. Universal Application
 Principles of science have universal application, that is, they remain true
irrespective of the conditions in which these are applied. As against this,
management principles are situation bound.
 It implies that a management principle which works well in one country may not
work equally well in another country. This is because of situational differences
between the two countries.
 Further, a management principle which works effectively in one organization may
not work effectively in another organization of the same country. Thus,
management cannot be called ‘true science’.
 The above discussion shows that management is not a true science. Therefore,
management is called an ‘inexact science‘ or ‘pseudo-science‘.
MANAGEMENT: BOTH ART AND SCIENCE
 Thus, to be a successful manager, a person requires the knowledge of management
principles and also the skills of how the knowledge can be utilized. Absence of
either will result in inefficiency.
 A comparison between art and science is presented in the below table which
suggests that a manager requires both aspects of management to be successful.

Dr.P.T.Kalaivaani, HOD/ECE & T.Raja,AP/ECE MG8591- PRINCIPLES OF MANAGEMENT(Unit-I)

Comparison between art and science as used in management
Art Science

Advances by practice Advances by knowledge

Feels Proves

Guesses Predicts

Describes Defines

Opines Measures

Expresses Impresses

 It can be seen that management uses both scientific knowledge and art in
managing an organization. As the science of management increases so should the
art of management. A balance between the two is needed. Neither should be over-
weighed or slighted.
 Some feel that further gains in science of management will restrict art more and
more. This is true to a limited extent only. The fact remains that to be useful,
knowledge of science must be applied, that is, art must be present. Therefore, the
old saying that ‘knowledge is power‘is partially true.
 The correct saying should be ‘applied knowledge is power‘. People having abundant
knowledge may have little use if they do not know how to use knowledge. This is
particularly true for management which is a situational phenomenon.

2. How do you classify the business organizations? Explain.

(APRIL/MAY 2019) (13 Marks)
Types of Business Organizations:
When organizing a new business, one of the most important decisions to be made is
choosing the structure of a business.
a) Sole Proprietorships:
The vast majority of small business starts out as sole proprietorships. These firms are
owned by one person, usually the individual who has day-to-day responsibility for
running the business. Sole proprietors own all the assets of the business and the
profits generated by it. They also assume "complete personal" responsibility for all of
Dr.P.T.Kalaivaani, HOD/ECE & T.Raja,AP/ECE MG8591- PRINCIPLES OF MANAGEMENT(Unit-I)
 its liabilities or debts. In the eyes of the law, you are one in the same with the
business.
Merits:
• Easiest and least expensive form of ownership to organize.
• Sole proprietors are in complete control, within the law, to make all decisions.
• Sole proprietors receive all income generated by the business to keep or reinvest.
• Profits from the business flow-through directly to the owner's personal tax return.
• The business is easy to dissolve, if desired.
Demerits:
• Unlimited liability and are legally responsible for all debts against the business.
• Their business and personal assets are 100% at risk.
• Has almost been ability to raise investment funds.
• Are limited to using funds from personal savings or consumer loans.
• Have a hard time attracting high-caliber employees, or those that are motivated by the
opportunity to own a part of the business.
• Employee benefits such as owner's medical insurance premiums are not directly
deductible from business income (partially deductible as an adjustment to income).
b) Partnerships:
 In a Partnership, two or more people share ownership of a single business. Like
proprietorships, the law does not distinguish between the business and its owners.
 The Partners should have a legal agreement that sets forth how decisions will be
made, profits will be shared, disputes will be resolved, how future partners will be
admitted to the partnership, how partners can be bought out, or what steps will be
taken to dissolve the partnership when needed.
 Yes, it‘s hard to think about a "break-up" when the business is just getting started,
but many partnerships split up at crisis times and unless there is a defined process,
there will be even greater problems.
 They also must decide up front how much time and capital each will contribute, etc.
Merits:
• Partnerships are relatively easy to establish; however time should be invested in
developing the partnership agreement.
• With more than one owner, the ability to raise funds may be increased.
• The profits from the business flow directly through to the partners' personal taxes.

Dr.P.T.Kalaivaani, HOD/ECE & T.Raja,AP/ECE MG8591- PRINCIPLES OF MANAGEMENT(Unit-I)

• Prospective employees may be attracted to the business if given the incentive to become
a partner.
Demerits:
• Partners are jointly and individually liable for the actions of the other partners.
• Profits must be shared with others.
• Since decisions are shared, disagreements can occur.
• Some employee benefits are not deductible from business income on tax returns.
• The partnerships have a limited life; it may end upon a partner withdrawal or death.
c) Corporations:
A corporation, chartered by the state in which it is headquartered, is considered by law
to be a unique “entity", separate and apart from those who own it. A corporation can
be taxed; it can be sued; it can enter into contractual agreements. The owners of a
corporation are its shareholders.
The shareholders elect a board of directors to oversee the major policies and decisions.
The corporation has a life of its own and does not dissolve when ownership changes.
Merits:
• Shareholders have limited liability for the corporation's debts or judgments against the
corporations.
• Generally, shareholders can only be held accountable for their investment in stock of
the company.
• Corporations can raise additional funds through the sale of stock.
• A corporation may deduct the cost of benefits it provides to officers and employees.
Can elect S corporation status if certain requirements are met. This election enables
company to be taxed similar to a partnership.
Demerits:
• The process of incorporation requires more time and money than other forms of
organization.
• Corporations are monitored by federal, state and some local agencies, and as a result
may have more paperwork to comply with regulations.
• Incorporating may result in higher overall taxes. Dividends paid to shareholders
are not deductible form business income, thus this income can be taxed twice.
d) Joint Stock Company:

Dr.P.T.Kalaivaani, HOD/ECE & T.Raja,AP/ECE MG8591- PRINCIPLES OF MANAGEMENT(Unit-I)

Limited financial resources & heavy burden of risk involved in both of the previous forms
of organization has led to the formation of joint stock companies these have limited
dilutives. The capital is raised by selling shares of different values. Persons who
purchase the shares are called shareholder. The managing body known as;
Board of Directors; is responsible for policy making important financial & technical
decisions.
There are two main types of joint stock Companies.
(i) Private limited company.
(ii) Public limited company
(i) Private limited company:
This type company can be formed by two or more persons. The maximum number of
member ship is limited to 50. In this transfer of shares is limited to members only.
The government also does not interfere in the working of the company.
(ii) Public Limited Company:
It is one whose membership is open to general public. The minimum number required to
form such company is seven, but there is no upper l imit. Such company‘s can
advertise to offer its share to genera public through a prospectus. These public limited
companies are subjected to greater control & supervision of control.
Merits:
• The liability being limited the shareholder bear no Rick& therefore more as make
persons are encouraged to invest capital.
• Because of large numbers of investors, the risk of loss is divided.
• Joint stock companies are not affected by the death or the retirement of the
shareholders.
Disadvantages:
• It is difficult to preserve secrecy in these companies.
• It requires a large number of legal formalities to be observed.
• Lack of personal interest.

3. Elucidate the contributions of F.W.Taylor to Management.

(April/May 2018) (13 Marks)
 Taylor defined management as, "the art of knowing exactly what you want men tie do
and seeing that they do it in the best and cheapest way." The objective of management

Dr.P.T.Kalaivaani, HOD/ECE & T.Raja,AP/ECE MG8591- PRINCIPLES OF MANAGEMENT(Unit-I)

 should be to secure the maximum prosperity for both the employer and the
employees.
 Taylor stated that best management was a true science based upon certain clearly
defined principles. He exhorted both managers and workers to substitute scientific
investigation and knowledge in place of individual involvement and experience in all
matters relating to the work alone in and organization. Taylor's theory came to be
called' scientific management'.
 His ideas are available in his book.' Principles of scientific management' published in
1911.
Taylor's principles of scientific management are as follows;
Development of a true science for each element of a man's job to replace the old rule of
thumb method.
 Scientific selection, training and development of workers for every job
 An almost equal division of work and responsibility between management and
workmen, management entrusted with the planning of work and workmen to look
after execution of plans.
 Close co-operation between management and workers to ensure that work is done
in accordance with the principles of the science, which has been developed.
 Maximum output in place of restricted output.
Techniques of scientific Management
Taylor developed several techniques these techniques provide the mechanism for
implementing his principles. Some of these techniques are given below:
1. Separation of planning and doing:
 Taylor suggests the separation of planning and doing.
 Taylor says that supervisor should be done the planning.
 The workers only concentrate on doing the work.
2. Functional foremanship:
• Taylor developed a theory called functional foremanship based on specialization of
function.
• In this system eight foreman were involved to direct and control the activities of the
workers.
3. Job analysis -'

Dr.P.T.Kalaivaani, HOD/ECE & T.Raja,AP/ECE MG8591- PRINCIPLES OF MANAGEMENT(Unit-I)

  Time Study: Time Study or work measurement is designed to establish the standard
time required to carry out a job under specified conditions.
 It involves analysis of a job into its constituent elements and recording the time
taken in performing each element. Taylor suggested the use of time study to lay
down "a fair day's work "so as to avoid guesswork and certainty in the effort and
productivity expected of each worker.
 Motion Study: It is a systematic and critical study of the movements of both the
worker and the machine so as to identify and eliminate unnecessary and wasteful
movements. Motion study helps to develop the best way of doing a Job.
 Fatigue study: Employees are both physical as well as mental fatigue easily.
 Fatigue study indicates the amount and frequency of rest required in completing
the job. Taylor suggests a fair day's work requiring certain movements and rest
periods to complete it.
4. Standardization:
 Under scientific management, predetermined standards are laid down regarding
the task, materials, methods, time, quality and cost and working conditions.
Standardization helps to simply work, to ensure interchangeability of parts, to
ensure uniformity of operations and to facilitate comparisons of efficiency.
5. Scientific selection and training:
 Taylor suggested that workers should be selected on scientifically.
 A worker should be physically and technically most suitable.

4. Explain the effect of Globalization and Liberalization in the global business

environment with examples.(April/May 2018). (13 Marks)
The government attitude towards the business has undergone a drastic change
beginning from the later years of eighties. This change can be seen from the various
policies announced by the government particularly.
1. Industrial policy statement
2. Long term fiscal policy
3. Exim policy.
All these policies measured clearly ret1ect the changing attitude of Government towards
business and the commitment of Government to Integrate Indian Economy with the
world's economy is called Globalization.

Dr.P.T.Kalaivaani, HOD/ECE & T.Raja,AP/ECE MG8591- PRINCIPLES OF MANAGEMENT(Unit-I)

Liberalization
 It eliminates licensing quantitative restrictions and other regulatory and
discretionary controls. The liberalization has enormously expanded the scope of
the private sector.
 Now only a small number and industries are reserved. The liberalization of the
policies towards foreign capital and technology and import liberalization have given
further growth and competition.
 The liberalization has given an enormous boost to private investment in the
industrial sector. In 1990-91 the year prior to liberalization the total capital
mobilized by the private co-operate factor by equity issues was Rs.1, 261crores.
 In 1994-95 i.e. four yrs since the liberalization the equity capital mobilized
increased to about Rs. 25 27,621 crores.
 After 1970 the industrial policy of the government turned towards liberalization of
industrial licensing with a view to accelerate the growth rate of the industrial
sector and to achieve export promotion on a large scale.
 In October 1975 the government delicenced 21 industries and permitted unlimited
expansion. Later it also announced that 25% 8f excess unauthorized capacity was
declared legal on the basis of normal
activity and another 25% would be covered in 5 yrs by automatic licensing.
 When Rajiv Gandhi became the prime minister the wave of liberalization gathered
further momentum. On way January 30, 1980 the government decided to delicense
23 MRTP and FERA companies provided they are located in backward areas.
Permissions were given liberally for expansion and Modernization.

5. Explain the fourteen principles of management advocated by Henry Fayol.

(Nov/Dec 2018). (13 Marks)
 Fayolism is one of the first comprehensive statements of a general theory of
management, developed by the French management theorist Henri Fayol (1841–
1925): one of the most influential contributors to modern concepts of management.
 Fayol has proposed that there are five primary functions of management:
(1) Planning, (2) Organizing, (3) Commanding, (4) Coordinating and (5)
Controlling.

Dr.P.T.Kalaivaani, HOD/ECE & T.Raja,AP/ECE MG8591- PRINCIPLES OF MANAGEMENT(Unit-I)

  Fayol's work has stood the test of time and has been shown to be relevant and
appropriate to contemporary management. Daft's text is organized around Fayol's
four functions.
 Many of today’s management texts including Daft (2005) have reduced the five
functions to four:
(1) Planning, (2) Organizing, (3) Leading and (4) Controlling.
 The 6 types of Operations For Fayol any organisation can be subdivided into six
types of operations. Each operation being fulfilled by its corresponding essential
function:
1. Technical Operations (production, manufacturing, transformation)
2. Commercial Operations (purchases, sales, exchanges)
3. Financial Operations (seek for capital and finance management)
4. Security Operations (protection of goods and people)
5. Accounting Operations (balance, P&L, cost control, statistics, etc)
6. Administrative' Operations (Management)
 In 1925 six month before Henri Fayol’s death Verne helped Fayol to redefine the
function of administration (Administration Industrielle et Generale).
 The 9 Levels Fayol was representing an organisation like a living body (« corps
social », ie. "social body") with main organs hierarchically structured as follow:
1. Shareholders,
2. Board of Administration,
3. General Direction and its General staff (advisors),
4. Regional/local Directions,
5. Main Engineers,
6. Services Managers,
7. Workshops Managers,
8. Foremen,
9. Workers.
 The 5 Elements of Administration Popularized by Fayol with the acronym of
POCCC:
1. Planning (to foresee/anticipate and make plans)
2. Organisation (to provide the Function with all is needed for its smooth running:
Supplies, Tools, Funding and Employees)

Dr.P.T.Kalaivaani, HOD/ECE & T.Raja,AP/ECE MG8591- PRINCIPLES OF MANAGEMENT(Unit-I)

 3. Commandment (to lead the people employed by the organisation)
4. Coordination (to harmonise all actions of an Organisation in order to facilitate
its smooth running and success)
5. Control (to verify if everything happens in accordance with defined plans, orders
given, and accepted principles)
 For Fayol, "The Art of Commanding” relies upon certain personal qualities and
upon the knowledge of management general principles. It has, like all other arts,
its degrees.
 The manager in charge of a commandment must:
1. Have a deep knowledge of his staff;
2. Cull the incapables;
3. Well know the conventions binding the organisation and its members;
4. Give the good example (by his attitude);
5. Conduct regular inspections of the « corps social »;
6. Get together his main partners in conferences (meetings) where are prepared the
Unity of Direction and the Focus of Efforts;
7. Not be distracted by details;
8. Aim to make prevalent among his staff, energy and initiative.
 The 14 Principles of Administration
1. Division of work: Reduces the span of attention or effort for any one person or
group. Develops practice or routine and familiarity.
2. Authority: "The right to give orders. Should not be considered without
reference to responsibility."
3. Discipline: "Outward marks of respect in accordance with formal or informal
agreements between a firm and its employees."
4. Unity of command: "One man one superior!"
5. Unity of direction: "One head and One plan for a group of activities with the
same objective."
6. Subordination of Individual Interests to the Common Interest: "The
interests of one individual or group should not prevail over the general or common
good."
7. Remuneration of personnel: "Pay should be fair to both the worker as well as
the organization."

Dr.P.T.Kalaivaani, HOD/ECE & T.Raja,AP/ECE MG8591- PRINCIPLES OF MANAGEMENT(Unit-I)

 8. Centralisation: "Is always present to a greater or lesser extent, depending on
the size of the company and the quality of its managers."
9. Scalar chain: "The line of authority from top to bottom of the organization."
10. Order: "A place for everything and everything in its right place; ie. The right
man in the right place."
11. Equity: "A combination of kindness and justice towards employees."
12. Stability of personnel tenure: "Employees need to be given time to settle in to
their jobs, even though this may be a lengthy period in the case of some
managers."
13. Initiative: "Within the limits of authority and discipline, all levels of staff
should be encouraged to show initiative."
14. Esprit de corps (Union is strength): "Harmony is a great strength to an
organization; teamwork should be encouraged."
 Fayol suggested that it is important to have unity of command: a concept that
suggests there should be only one supervisor for each person in an organization.
 Like Socrates, Fayol suggested that management is a universal human activity that
applies equally well to the family as it does to the corporation.

6. Discuss in detail the Evolution of Management.(Nov/Dec 2016) (13 Marks)

Management Definition
Management is the art of getting things done through others. Harold Koontz Def as
"Management is the process of designing and maintaining an environment in
which individuals, working together in groups efficiently to accomplish selected
aims"
 Managers carry out their managerial function
 Applies to any kind of Organization
 Applies to managers at all organizational levels
 Aim is to create a surplus
 Concerned with productivity, implies effectiveness and efficiency
 Management of 4 M's in the Organization - Men, Machine, Materials &money
Characteristics of Management
Management is Universal
1. Management is Purposeful

Dr.P.T.Kalaivaani, HOD/ECE & T.Raja,AP/ECE MG8591- PRINCIPLES OF MANAGEMENT(Unit-I)

2. Management is integrative Function
3. Management is a Social process
4. Management is a Multidisciplinary
5. Management is a continuous process
6. Management is intangible
Management is an art as well as a science Management as an Art
• Art involves the practical application of personal skills and knowledge to achieve
concrete results
• It is a practical way of doing specific things
• Art is a personalized process and every artist has his own style. Art is essentially
creative and the success of an artist is measured by the results he achieves
• Art is a practice based and perfection in it requires continuous practice over a long
period of time.
The main elements of an art are -
 Personal Skills
 Practical know-how
 Result orientation
 Creativity
 Constant practice aimed at perfection
Management is basically an art because of the following reasons -
A manager applies his knowledge and skills to coordinate the efforts of his people
• Management seeks to achieve concrete practical results
• Management is creative. It brings out new situation and converts into output
• Effective Management lead to realization of Organizational and other goals. Mastery in
Management requires a sufficiently long period of experience in, managing.
Management as Science
The essential elements of Science
1. It is a systematized body of Knowledge
2. Contains underlying principles and theories developed through continuous
observation, experimentation and research.
3. Universal applicability
4. Organized body of knowledge can be taught and learnt in class room and outside.

Dr.P.T.Kalaivaani, HOD/ECE & T.Raja,AP/ECE MG8591- PRINCIPLES OF MANAGEMENT(Unit-I)

- Management is a science because it contains all the essential of science Thus, the
theory (Science) and practice (art) of Management go side by side for the efficient
functioning of an organization.
Management as a Profession
The essential attribute of a profession
1. A well-defined and organized body of knowledge
2. Learning and Experience
3. Entry restricted by qualification
4. Recognized national body
5. Ethical code of conduct
6. Dominance of service motive
Functions of Management.
Management is the art of getting things done through others. According to Harold
Koontz, "Management is the process of designing and maintaining an environment
in which individuals, working together in groups efficient to accomplish selected
aims".
1. Managers carry out their managerial function
2. Applies to any kind of Organization
3. Applies to managers at all organizational levels
4. Aim is to create a surplus
5. Concerned with productivity, implies effectiveness and efficiency
6. Management of 4 M's in the Organization - Men, Machine, Materials &money
Characteristics of Management
1. Management is Universal
2. Management is Purposeful
3. Management is integrative Function
4. Management is a Social process
5. Management is a Multidisciplinary
6. Management is a continuous process
7. Management is intangible
8. Management is an art as well as a science
Importance of Management
Management is the dynamic life -giving clement in every business.

Dr.P.T.Kalaivaani, HOD/ECE & T.Raja,AP/ECE MG8591- PRINCIPLES OF MANAGEMENT(Unit-I)

Without it the resources of production remain resources and never
become production. Sound Management provides the following benefits.
1. Achievement of group goals
2. Optimum utilization of resources
3. Fulfillment of social obligations
4. Economic growth
5. Stability
6. Human Development
7. Meets the challenge of change
Functions Classification of managerial Functions
Forecasting, decision making, strategy formulation, policy
Planning making, programming, scheduling, budgeting, problem-solving,
innovation, investigation and research.
Grouping of Functions. Depart mentation, delegation
Organizing
decentralization on, activity analysis, task allocation
Manpower planning, job analysis, Recruitment, Selection,
Staffing
training, placement, Compensation, promotion, apprasial, etc
Directing Supervision, Motivation, Communication, Leadership etc.
Fixation of standard, recording, measurement, reporting
Controlling
corrective action.

Need for Management

1. To increase efficiency
2. To crystallize the nature of Management job
3.To improve research in Management
4.To attain social goals.

Dr.P.T.Kalaivaani, HOD/ECE & T.Raja,AP/ECE MG8591- PRINCIPLES OF MANAGEMENT(Unit-I)