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MBA DEPARTMENT ETHIRAJ COLLEGE FOR WOMEN CHENNAI

COURSE MATERIAL FOR SELF STUDY PAPER

MANANGEMENT PRINCIPLES
I YR STUDENTS

Contents: Objective: This course provides an overview of management. It covers theory, process and practice of the four fundamental management skills: Planning, Organizing, Leading and Controlling as well as the role of managers in organizations. Unit I: Concepts: The Evolution of Management Science Classical neo classical and modern theories of management Management Defined Basic Principles and Process of Management Planning: Basic Techniques Key factors Business environment Business environment Micro-Macro relevant techniques for environment scanning

Unit II: Policies Formulation Classifications Strategy Concepts Process Organization: Hierarchy factors to be considered & classifications Methods of grouping typical patterns used Organization charts & manuals Unit III: Authority: Authority relationships Delegation of authority & relationship Centralization & decentralization Span of control: Pros and cons of narrow and wide spans of control Optimum span Unit IV: Communication Introduction to managerial communication Traits of good communication Formal and informal channel-follow up Unit V: Co-ordination need techniques Control: process performance standards measurement of performance remedial actions Unit VI: Management by objectives Management by exception Trends New perspectives in Management Outcome: Use management terms as they relate to business situations Understand and apply management principles and concepts as they apply to business situations Understand the role of management in making business decisions

MANAGEMENT Management in all business and human organization activity is simply the act of getting people together to accomplish desired goals and objectives. Management comprises planning, organizing, staffing, leading or directing, and controlling an organization (a group of one or more people or entities) or effort for the purpose of accomplishing a goal. Resources encompasses the deployment and manipulation of human resources, financial resources, technological resources, and natural resources Some Definitions of management are:

Organization and coordination of the activities of an enterprise in accordance with certain policies and in achievement of clearly defined objectives. Management is often included as a factor of production along with machines, materials, and money. According to the management guru Peter Drucker (19092005), the basic task of a management is twofold: marketing and innovation. Directors and managers who have the power and responsibility to make decisions to manage an enterprise. As a discipline, management comprises the interlocking functions of formulating corporate policy and organizing, planning, controlling, and directing the firm's resources to achieve the policy's objectives. The size of management can range from one person in a small firm to hundreds or thousands of managers in multinational companies. In large firms the board of directors formulates the policy which is implemented by the chief executive officer.

Basic functions of management Management operates through various functions, often classified as planning, organizing, leading/motivating, and controlling.

Planning: Deciding what needs to happen in the future (today, next week, next month, next year, over the next 5 years, etc.) and generating plans for action. Organizing: (Implementation) making optimum use of the resources required to enable the successful carrying out of plans.

Staffing: Job analyzing, recruitment, and hiring individuals for appropriate jobs. Leading: Determining what needs to be done in a situation and getting people to do it. Controlling: Monitoring, checking progress against plans, which may need modification based on feedback. Motivating: the process of stimulating an individual to take action that will accomplish a desired goal.

Management hierarchy: Senior management (or "top management" or "upper management") Middle management Lower-level management, such as supervisors or team-leaders Top-level management

Require an extensive knowledge of management roles and skills. They have to be very aware of external factors such as markets. Their decisions are generally of a long-term nature Their decisions are made using analytic, directive, conceptual and/or behavioral/participative processes They are responsible for strategic decisions. They have to chalk out the plan and see that plan may be effective in the future. They are executive in nature.

Middle management

Mid-level managers have a specialized understanding of certain managerial tasks. They are responsible for carrying out the decisions made by top-level management.

Lower management

This level of management ensures that the decisions and plans taken by the other two are carried out. Lower-level managers' decisions are generally short-term ones.

Principles of Management: The Principles of Management are the essential, underlying factors that form the foundations of successful management. According to Henri Fayol (1841-1925) in his book General and Industrial Management (1916), there are fourteen 'principles of management'.

The Principles of management Management principles are statements of fundamental truth. These principles serve as guidelines for decisions and actions of managers. They are derived through observation and analysis of events which managers have to face in practice. 1. Division of Work The specialization of the workforce, creating specific personal and professional development within the labour force and therefore increasing productivity; leads to specialization which increases the efficiency of labour. By separating a small part of work, the workers speed and accuracy in its performance increases. This principle is applicable to both technical as well as managerial work. 2. Authority and ResponsibilityThe issue of commands followed by responsibility for their consequences. Authority means the right of a superior to give order to his subordinates; responsibility means obligation for performance. This principle suggests that there must be parity between authority and responsibilty.. They are co-existent and go together, and are two sides of the same coin. 3. DisciplineDiscipline refers to obedience, proper conduct in relation to others, respect of authority, etc. It is essential for the smooth functioning of all organizations. 4. Unity of Command This principle states that every subordinate should receive orders and be accountable to one and only one superior. If an employee receives orders from more than one superior, it is likely to create confusion and conflict.

Unity of Command also makes it easier to fix responsibility for mistakes. 5. Unity of Direction All those working in the same line of activity must understand and pursue the same objectives. All related activities should be put under one group, there should be one plan of action for them, and they should be under the control of one manager. It seeks to ensure unity of action, focusing of efforts and coordination of strength. 6. Subordination of Individual Interest The management must put aside personal considerations and put company objectives first. Therefore the interests of goals of the organization must prevail over the personal interests of individuals. 7. Remuneration Workers must be paid sufficiently as this is a chief motivation of employees and therefore greatly influences productivity. The quantum and methods of remuneration payable should be fair, reasonable and rewarding of effort. 8. The Degree of Centralization The amount of power wielded with the central management depends on company size. Centralization implies the concentration of decision making authority at the top management. Sharing of authority with lower levels is called decentralization. The organization should strive to achieve a proper balance. 9. Scalar Chain Scalar Chain refers to the chain of superiors ranging from top management to the lowest rank. The principle suggests that there should be a clear line of authority from top to bottom linking all managers at all levels. It is considered a chain of command. It involves a concept called a "gang plank" using which a subordinate may contact a superior or his superior in case of an emergency,defying the hierarchy of control.However the imediate superiors must be informed about the matter 10. Order Social order ensures the fluid operation of a company through authoritative procedure. Material order ensures safety and efficiency in the workplace. 11. Equity -

Employees must be treated kindly, and justice must be enacted to ensure a just workplace. Managers should be fair and impartial when dealing with employees. 12. Stability of Tenure of Personnel The period of service should not be too short and employees should not be moved from positions frequently. An employee cannot render useful service if he is removed before he becomes accustomed to the work assigned to him. 13. Initiative Using the initiative of employees can add strength and new ideas to an organization. Initiative on the part of employees is a source of strength for the organization because it provides new and better ideas. Employees are likely to take greater interest in the functioning of the organization. 14. Esprit de Corps This refers to the need of managers to ensure and develop morale in the workplace; individually and communally. Team spirit helps develop an atmosphere of mutual trust and understanding. These can be used to initiate and aid the processes of change, organization, decision making, skill management and the overall view of the management function. Scientific management Taylor believed that the industrial management of his day was amateurish, that management could be formulated as an academic discipline, and that the best results would come from the partnership between a trained and qualified management and a cooperative and innovative workforce. Each side needed the other, and there was no need for trade unions. Taylors approach is also often referred to, as Taylor's Principles, or frequently disparagingly, as Taylorism. Taylor's scientific management consisted of four principles: 1. Replace rule-of-thumb work methods with methods based on a scientific study of the tasks. 2. Scientifically select, train, and develop each employee rather than passively leaving them to train themselves. 3. Provide "Detailed instruction and supervision of each worker in the performance of that worker's discrete task" (Montgomery 1997: 250). 4. Divide work nearly equally between managers and workers, so that the managers apply scientific management principles to planning the work and the workers actually perform the tasks.

Managers and workers Taylor had very precise ideas about how to introduce his system: It is only through enforced standardization of methods, enforced adoption of the best implements and working conditions, and enforced cooperation that this faster work can be assured. And the duty of enforcing the adoption of standards and enforcing this cooperation rests with management alone. Workers were supposed to be incapable of understanding what they were doing. According to Taylor this was true even for rather simple tasks. The introduction of his system was often resented by workers and provoked numerous strikes. The strike at Watertown Arsenal led to the congressional investigation in 1912. Taylor believed the labourer was worthy of his hire, and pay was linked to productivity. His workers were able to earn substantially more than those in similar industries and this earned him enemies among the owners of factories where scientific management was not in use. Management Theories: Scientific Management Theory (1890-1940) At the turn of the century, the most notable organizations were large and industrialized. Often they included ongoing, routine tasks that manufactured a variety of products. The United States highly prized scientific and technical matters, including careful measurement and specification of activities and results. Management tended to be the same. Frederick Taylor developed the: scientific management theory which espoused this careful specification and measurement of all organizational tasks. Tasks were standardized as much as possible. Workers were rewarded and punished. This approach appeared to work well for organizations with assembly lines and other mechanistic, routinized activities. Bureaucratic Management Theory (1930-1950) Max Weber embellished the scientific management theory with his bureaucratic theory. Weber focused on dividing organizations into hierarchies, establishing strong lines of authority and control. He suggested organizations develop comprehensive and detailed standard operating procedures for all routinized tasks. Human Relations Movement Eventually, unions and government regulations reacted to the rather dehumanizing effects of these theories. More attention was given to individuals and their unique capabilities in 8

the organization. A major belief included that the organization would prosper if its workers prospered as well. Human Resource departments were added to organizations. The behavioral sciences played a strong role in helping to understand the needs of workers and how the needs of the organization and its workers could be better aligned. Various new theories were spawned, many based on the behavioral sciences (some had name like theory X, Y and Z). Mary Parker Follett (1868-1933), on the other hand focused more on human relations rather than on scientific type approaches in order to increase production. Follett's studies allowed for other theorists to study new areas, including Chester I. Barnard (1886-1961). His contribution was the introduction of the informal organization concept. He believed that if properly managed, this could be a powerful tool in helping the organization achieve its' goals (Daft and Marcic, 1998).

UNIT-II POLICIES BUSINESS POLICY Meaning and Definition:Policy-making is one of the most important components of business planning. Policies may be defined as the mode of thought and the principles underlying the activities of an organization or an institution. Terry says, A business policy is an implied overall guide setting up boundaries that supply limits and direction in which managerial action will take place. FEATURES OF BUSINESS POLICY: Policies are a general statement of principles fro the attainment of objectives. Policies have a hierarchy. The policies delimit the area within which a decision is to be made and ensure that the decision will be consistent with and contribute to the objectives. Policies in general are meant for mutual application by subordinates.

Policies tend to predecide issues, avoid repeated analysis and give a unified structure to other types of plans. Policies are found in all functional areas and at various levels within these areas. Policies serve an extremely useful purpose. A policy is a positive declaration band a command to its followers.

MECHANICS OF POLICY MAKING/ELEMENTS: Identification of the situation. Development of policy. Dissemination of the policy. Explanation of the policy. Acceptance of the policy. Feed back.

CLASSIFICATION OF POLICIES:1. Classification according to the level of formulation:Business policies are of different levels they are: Top management policies Middle level management policies upper middle management middle management

lower level management policies operating force policies

2. Classification according to the functional areas: Production policies

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Marketing and sales policies Financial policies Personnel policies

3. Classification according to the expression: Expressed Oral Written Implied

4. Classification according to the nature of origin: Originated policies Appealed policies Imposed policies Derivative policies

5. Classification according to the scope of organization: Basic policies General policies Departmental or specific policies

6. Classification according to the nature of management function: Planning policies Organizing policies Actuating policies Controlling policies

STRATEGY:-

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Strategy is the complex plan for bringing the organization from a given posture to a desires position in a future period of time. NATURE OF STRATEGY:Characteristics:Long-term plan provides the directions in which human and physical resources will be deployed for achieving organizational goals primarily concerned with expected trends in the markets an interpretative plan is forward looking mainly the job of top management. TYPES OF STRATEGIES:1. GRAND OR MASTER STTRATEGY:- It determines the nature and scope of the enterprise. (a) Stability strategy:An organization which follows this strategy is satisfied with its performance and wants the same rate of growth. (b) Growth strategy:This means an enterprise wants to raise its level of performance or rate of growth. (c) Integration strategy:Taking over or combining with other business firms is called integration strategy. (d) Turnaround or Retrenchment Strategy:This means reduction in the level of performance. (e) Divestment or closure strategy:-

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This implies giving up operations altogether or closing down. 2. FUNCTIONAL STRATEGY OR SUB- STRATEGY:These strategies are used for development of resources to achieve specific objectives. ESSENTIALS OF A GOOD STRATEGY: (1) Internal consistency. (2) Consistency with environment. (3) Appropriate time horizon. (4) Realistic. (5) Acceptable degree of risk. (6) Feasibility. STRATEGY-MAKING PROCESS: a.Environmental analysis:- The external environment of enterprise is analyzed. b. is examined c.Strategic Alternatives:- Alternative strategies are developed. d. chosen. e.Strategy Implementation:- Detailed operational plans are developed and communicated to employees so as to execute the chosen strategy. Strategic Choice:- The most appropriative strategy is Self- Appraisal:- The internal environment of the enterprise

ORGANISATIONAL HIERARCHY:-

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Organizational hierarchy is the vertical representation of ranks of personnel within an organization, each layer subordinate to the one above it. Organization hierarchy is often shown in the form of an organization chart. An extended hierarchy is typical of a bureaucracy, but during the later 20th and early 21st centuries the layers of hierarchical positions within large organizations have often been reduced as part of downsizing exercises. These result in the shallow or nonexistent hierarchies of flexible, flat organizations, within which there is greater employee empowerment and autonomy.

Top leve l Middle level

Strategic decisions

Administration

Operating level

Operation

Top level management:This level comprises of the various top level CEOs, CFOs and the Board of Directors, etc. Their job is to make the strategic decisions that will effect the companys operations in the long run. Middle level management:This level of employees consists of the managers and the supervisors that manage the lower level employees but are still under the top management and their job is administrative. Operating level management:This level of employees consists of the work shop employees and their job is routine.

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FACTORS TO BE CONSIDERED ARE AS FOLLOWS: Specialization and division of labor:The organizational hierarchy depends on the specialization level and the division of labor as the lesser administrative work is required for a highly specialized job. Department:This means dividing large and complex organizations into smaller and flexible administrative units. The more the number of departments the more the administrative work of the middle level. Chain of Command:The flow of command (authority) from the top level to the lowest level of management does decide the organization hierarchy. Span of Management:This refers to the number of sub-ordinates that are directly under a supervisor. This takes into consideration the number of sub-ordinates that a single supervisor can effectively manage at one time. DEFINITION OF GROUP:-

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A group consists of two or more persons who are interacting with one another in such a manner that each person influence and is influenced by others. Members of a group have a common goal; interact with one another and corporate work together to achieve a common goal. Group is different from a mere aggregation or assembly of persons. TYPES OF GROUPS:Groups may be classified into the following categories:1. Formal and informal groups 2. Primary and secondary groups 3. Membership and reference groups 4. In-groups and out-groups Formal and informal groups:Formal groups are deliberately created by management to achieve the goals of the organization. Formal groups may be (a) command groups consisting of managers and subordinates, or (b) tasks groups consisting of members performing similar tasks, e.g. a committee. Informal groups spontaneously emerge when people regularly interact stable and with one another on personal or social basis. Informal groups tend to be smaller than formal groups. Primary and Secondary groups:In a primary group individual members are in close face to- face relationship over a relatively long time period. In a secondary group, on the other hand interactions between members are loose and general. Government, municipality and university are examples of secondary groups. Membership and reference groups:-

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A membership group consists of persons who actually belong to the group. They may or may not be satisfied with being members of the group. A reference group is a group with which a person identifies himself or to which he would like to belong. There may be a conflict between the norms and values of membership and reference group. In-groups and Out-groups:An in-group comprises persons who religiously abide by prevailing norms and values of the society. An out-group consists of persons whose norms and values differ from those prevailing in the society . REASONS FOR FORMATION OF INFORMAL GROUPS:The main causes leading to the formation of informal groups are as follows:1. Desire to associate with others:Formal organizations is impersonal and does not satisfy the natural social needs of people . Informal organizations provides them opportunity to interact and socialize outside the formal organizational relationship. 2. Job Specialization:In large organizations there is narrow specialization. It causes burden and fatigue Employees are unable to understand how they contribute to the main job and goals of the organization. They develop informal relationships to release their tension. 3. Hierarchical Control and Communication:In a large organizations , there is a hierarchical or formal chain of communication and control. There exist a large gap between superiors and subordinates. The organization becomes impersonal due to social distance.

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MERITS OF INFORMAL GROUPS:Informal groups offer the following benefits to their members:-

Sense of Belonging: In a formal organization, an employee is one among thousands and feels no sense of belonging. Informal groups fill this void by providing a social structure and status. Safety Value for Emotional Problems:The daily work routine causes tension and frustration to workers. Assistance on the Job:Members of an informal group help one another in case of accident or illness. The informal groups protect its members from external pressures such as a change in work methods. Communication Channel:In a formal organizations, employees receive important information about the company only when it is officially released. Breeding Ground for Innovation and creativity:Informal groups provide the environment necessary for individual creativity and innovation. Check on Authority:Informal groups force managers to plan and act more carefully Informal groups provide feeling of security and status to members. Social Control:-

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Every informal group has its norms which serve as guides to correct behavior for members. Self-policing:When the informal group is cooperative, management is relieved of the burden of supervision. Informal groups may help to promote organization objectives by strengthening the ties of their members with the organization. Fill gaps in Managers Abilities:More competent members of an informal group may help in areas in which the superior is week. Provide Feedback:Informal groups provide feedback about employees and their work experiences to management DEMERITS OF INFORMAL GROUPS:Informal groups suffer from following limitations: Resistance to Change:An informal group has its own culture conventions and work methods. The group resists those demands of management which are perceived as a threat to its culture. Sub-optimization:Members of an informal group give preference to their own needs and goals over the objective of the organization. Role Conflict:When a person is a member of both formal and informal groups the faces a conflict.

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Rumor:Informal groups are often the source of rumors. An outbreak of rumor can be very harmful to the company. Group Think: Many members come to believe that whatever the group decides is good any idea however useful which decides from the group philosophy is rejected. HOW TO MANAGE INFORMAL GROUPS:Management does not create informal groups. Therefore, management should take steps to harmonize these groups with formal organizations. The following steps may be taken for this purpose:(i) (ii) (iii) (iv) Where informal group norms are acceptable they should be institutionalized. Management should make constructive us of communication When informal leaders develop, they may be appointed to positions of formal authority. All major cliques comprising the informal organizations should be catalogued. informal lines of

Organizational Charts & Manuals Definition: An organizational chart is a diagrammatical form, which shows important aspects of an organization including the major functions and their respective relationships, the channels of supervision, and the relative authority of each employee who is in charge of each respective function. Types: All organization charts may be classified into three broad categories: 1. Vertical Charts:

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Shows the organization structure in the form of a pyramid from top to bottom in vertical lines Hence known as top to down chart also It is the most widely used chart

2. Horizontal charts: Pyramid lies horizontally Hence called left to right chart Highest position is shown in the extreme left and lowest in extreme right

3. Concentric or Circular Charts: Highest position is shown in the centre and lowest in the outermost circle Distance of a position from the centre indicates the degree of closeness to the top position Position of equal status lie at the same distance from the centre More difficult to draw and confusing

4. Pfiffner and Sherwoods classification: Skeleton Chart: Its a mere graphic representation of the hierarchical framework. Contains the principal units and sub-units in the form of squares and rectangles. Solid black lines represent lines of command while broken lines indicate staff or functional relationships. Functional Chart: Consists of sub-units; boxes represents divisions and sections. Personnel Chart: same process of functional chart is used but boxes here contain personnel information.

Master and supplementary charts: A master chart shows the whole structure of the organization and provides a clear picture of the entire structure. A supplementary chart depicts the various units within a department and authority relationship among them.

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Advantages and uses: Shows clearly the various positions in the organization, the lines of authority and responsibility. Provides a basis of planning organizational change Guidance to outsiders as to whom to contact Guidance to new personnel into the total organization Identify overlapping relationships Facilitates communication

Limitations: Shows only formal relationships Does not represent flexibility Updating of chart is difficult Fail to show the extent of authority Poor design may cause confusion Does not show actual relationship in the organization

Organization manual:Definition: A small handbook or booklet containing detailed information about the objectives, policies, procedures, rules etc of the enterprise. Contents of the manual: 1. Introductory Name Nature Objectives

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Location Purpose of the organization

2. Administrative Organization structure Job descriptions Policies Rules and regulations

3. Procedural Procedures and practices Specimen forms to be used Standard instructions Methods Glossary of important terms

Types: 1. Policy Manual: Contains basic policies of the company, decisions and resolutions of the top management Describes overall limitations Serves as useful guide to action

2. Company organization manual:

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Gives the set-up of the Co. Describes duties and responsibilities Outlines the formal chain of command

3. Operations manual: Describes established stds, procedures, methods Gives overall view

4. Departmental practice manual: Contains detailed information about the orgn, policies, and procedures of one dept. Inter-departmental relations are also shown

5. Rules and Regulations Manual: Advantages: Written form Useful in the orientation and training of new employees Permits quick decisions at lower levels Helps to avoid jurisdictional conflicts Describes operating rules and employment regulations Eg: hrs of work, timings, library, recreation, etc. Explain employee benefit plans housing, safety, hospitalization etc.

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Provides uniformity and consistency in operations

Drawbacks: Expensive and time consuming Creates rigidity in the organization Manuals may put on record those relationships which should not be exposed

UNIT-III DECENTRALISATION Decentralisation refers to the systematic effort to delegate to the lowest level all authority except that which can only be exercised at central points. Decentralisation refers to the systematic delegation of authority in an organisation context. Effective decentralization requires a proper balance between dispersal of authority among lower levels and adequate control over them. MEASURING THE DEGREE OF DECENTRALISATION: Number of decisions Importance of decisions Effects of decision Checking of decisions

ADVANTAGES OF DECENTRALISATION:

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Relief to top executives Motivation of subordinates Quick decisions Growth and diversification Executive development Effective communication Efficient supervision and control.

DISADVANTAGES OF DECENTRALISATION: Expensive Difficulty to coordinate Lack of uniformity Narrow product lines External constrains

FACTORS DETERMINING DECENTRALISATION AND DELEGATION: Size and complexity of the organisation Dispersal of operations Degree of diversification History of the enterprise Outlook of top management 26

Availability of competent personnel Nature of functions Communicative system Complexities of the situation

DISTINCTION BETWEEN DELEGATION AND DECENTRALISATIIION:

Delegation means transfer of authority from one individual to another Decentralisation means diffusion of authority throughout the organisation. Delegation is a process or an act, but decentralisation is the end result of delegation. Delegation denotes the relationship between a superior and a subordinate. But decentralisation denotes the relationship between the top management and various departments. Delegation is an essential management process but delegation is optional. The delegator exercise control over the subordinate, but the control may be delegated to the departmental heads. Delegation is a technique of management; decentralisation is a philosophy of management. MAKING DECENTRALISATION EFFECTIVE: Appropriate centralisation Development of the managers

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Open communication Coordination Adequate controls CENTRALISATION

Centralisation is the systematic and consistency reservation of authority at central points within an organisation. Centralisation implies the concentration of authority at the top level of the organisation while decentralisation means dispersal of authority throughout the organisation. Centralisation and decentralisation are relative terms Everything that goes to increase the importance of the subordinates role is decentralisation; everything which goes to reduce it is centralisation.

ADVANTAGES: Personal leadership Uniformity of action Flexibility Integration Handling emergencies Utilisation of personnel

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Problem in decision making Overburdening Lack of executive development Low morale

DELEGATION Delegation is a skill of which we have all heard - but which few understand. It can be used either as an excuse for dumping failure onto the shoulders of subordinates, or as a dynamic tool for motivating and training your team to realize their full potential. To delegate means to entrust authority to a deputy so as to enable him to the tasks assigned to him. In the words of Louis A. Allen, Delegation is the dynamics of management; it is the process a manager follows in dividing the work assigned to him so that he performs that part which only he, because of his unique organizational placement can perform effectively, and so that he can get others to help him with what remains.

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OBJECTIVE OF DELEGATION The objective of delegation is to get the job done by someone else. Not just the simple tasks of reading instructions and turning a lever, but also the decision making and changes which depend upon new information. With delegation, the staff have the authority to react to situations without referring back to the superior all the time. To enable someone else to do the job, one must ensure that:

they know what is wanted of them they have the authority to achieve it they know how to do it.

These all depend upon communicating clearly the nature of the task, the extent of their discretion, and the sources of relevant information and knowledge. ELEMENTS OF DELEGATION In any scheme of delegation the following 4 elements stand out: 1. Assigning of duties or tasks. 2. Delegation of authority. 3. Accountability for performance of duties. 4. Accountability for exercise of authority. PRINCIPLES OF DELEGATION Delegation can be effective only if it confirms to certain well-established principles like: 1. Delegation to confirm to desired objectives. 2. Responsibility cannot be delegated. 3. Authority to match duties. 4. Unity of command. 5. Limits to authority to be well-defined. TYPES OF DELEGATION 30

Delegation may assume various forms. For example, it may be: 1. General (or) Specific. 2. Written (or) Unwritten. 3. Formal (or) Informal. 4. Downward, Upward (or) Sideward. ADVANTAGES OF DELEGATION Delegation offers several advantages. Important among these are: 1. It is the basis for effective functioning. 2. It helps in the reduction of managerial load. 3. It helps to enjoy the benefits of specialized services. 4. It helps in the efficient running of branches. 5. It aids in employee development. 6. It aids in expansion and diversification of business. 7. It helps in maximizing organizational effectiveness 8. It helps in better and speedier decision-making 9. It helps to inculcate self-confidence and initiative among subordinates. BARRIERS TO DELEGATION Barriers could be in the form of organizational barriers and psychological barriers. Why managers do not delegate: 1. Feeling of superiority. 2. Habit pattern. 3. Fear of exposure. 4. Feeling of indispensability. 5. Risk avoidance. 6. Loss of importance.

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Why subordinates do not accept delegation: 1. Insecurity and fear of criticism. 2. Inadequacy of information and resources. 3. Lack of self-confidence. 4. Inadequate incentives. STEPS TO MAKE DELEGATION EFFECTIVE The following are the guidelines based on classical principles, to make delegation effective and productive of the desired results: 1. Determination of specific goals. 2. Accountability. 3. Authority and responsibility. 4. Chain of command. 5. Unity of command. 6. Motivation. 7. Training. SPAN OF CONTROL: Meaning: Number of subordinates who report directly to a single manager or supervisor. THEORY OF GRAICUNAR: French management consultant. Mathematical formula for analyzing superior subordinate relationship. No of subordinates increases arithmetically there is exponential increase in the no of possible relationship. 3 types of superior subordinate relationship. 1. DIRECT SINGLE RELATIONSHIP: 2 direct relationship For e.g. A with X and A with Y. 2. DIRECR GROUP RELATIONSHIP: These relationships arise between the manager and group of his subordinates in all possible combinations. 32

3. CROSS RELATIONSHIPS: Relationship that arise among the subordinates working under a common superior. For e.g. X with Y Y with X. FORMULA FOR THIS THREE TYPE IS AS FOLLOWS. 1. Direct group relationship: n (2^n / 2-1) 2. Cross relationship: n (n-1 ) 3. Total relationship= n (2 ^ n / 2-1) + n (n-1) n(2^n/2+n1) Were N = no of subordinates. No of subordinates No of relationship 1 1 2 6 3 18 4 44 5 100 6 222 7 490 MERITS: 1. Effective method of finding relationship 2. 6 subordinate 222 relationships 3. Indication to manager to think twice before increase in subordinates. DEMERITS: 1. Ignore the intensity of relationships 2. Factors which determine span not taken into consideration. FACTORS DETERMING SPAN OF CONTROL: Nature of work Type of technology Ability of manager Capacity of subordinates Degree of decentralization Planning

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Staff assistance Communication technology Time available for supervision Geographical dispersion of subordinates.

Optimum Span of Control

An important task in structuring organizations, especially large ones, is determining what the span of control of managers or supervisors should be. The span of control, or span of management, refers to the number of persons who report to one superior and includes the functions of planning, organizing and leading. The span of management has a direct beating upon the number of levels in an organization, which is a measure of the length of that organization's lines of communications. There are several factors to consider in order to establish the proper span of control for managers. In addition, the span of control will affect the attitudes and behavior of the organizational members. Historically, the concern over span of control was based on the idea that some optimal number of manageable subordinates should exist. Researchers in the past, such as Col. Urwick, stated that the optimal span of control was five or six. This as based on the assumption that managers have a limited span of attention, energy and time. If a manager was responsible for more than five or six subordinates, it was felt that the manager would loose track of what was happening. Although only a small percentage of these interactions actually occur on a daily basis, the message conveyed is that at some point the addition of one more subordinate could create some serious problems for the manager. Basis that has been used to establish an optimal span of management is through applying what appears to work for military organizations or very old organizations such as the Catholic Church. The problem with this method and the other traditional views is that 34

they have a tendency to look for a single number answer without considering all the different factors that contribute to the effective span of control. Examining all these different factors is very important before determining a proper span of control. Generally, if workers are involved in work of a trivial or routine nature, the supervisor will tend to require less application of control than if they perform work of greater significance or complexity. In addition, spans may be limited by where people are and by the problems of control and communication over distance. Also, a supervisor can exercise more effective control over a broader span in a stable situation than under dynamic conditions. Effective delegation of authority will allow a manager's span of control to increase by reducing the frequency and severity of time-consuming relationships with subordinates. Probably the most important way to achieve a wider span of control is to practice Theory Y management methods, thereby encouraging employees to be as productive as possible. Using budget control systems also permits the supervisor to increase the size of his span. Another way of expanding the span of control is to introduce staff assistants who can act as a screening mechanism and perform the more routine tasks. Competent and well-trained subordinates tend to make fewer mistakes and require less correction and counseling from their supervisors, thus allowing the span of management to increase. Furthermore, if the job requires nominal training and all workers know what to do, spans can be very broad. Managers who are well-liked and inspire subordinates to work hard should have larger spans. Likewise, subordinates that respond well to orders will make a larger span of control possible. As the immediate goals of subordinates become congruent with the goals of other subordinates and with the goals of the organization, the span of management may be increased.

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Since large firms typically face a greater volume of important problems, large firms tend to have larger spans than medium-size firms. The optimal span will measure the relative advantages and disadvantages of retaining supervisory responsibility as opposed to delegation. Many professional people, such as doctors, lawyers, professors and engineers, perform work without much supervision, so spans can be very broad. Firms that insist on close supervision of responsible professionals will tend to lose them since few good professionals appreciate working in a tightly controlled environment. The primary advantages of having a narrow span of control are that it should provide close supervision, close control and fast communication between subordinates and superiors. The major disadvantages of a narrow span include: * Superiors tend to get too involved in subordinates' work; * Many levels of management, which leads to high costs; and * Excessive distance between lowest level and top level. The advantages of having a wide span of management are that superiors are forced to delegate, clear policies must be made and subordinates must be carefully selected. Some of the disadvantages of a wide span of control are the tendency of overloaded superiors to become decision bottlenecks, the danger of a superior's loss of control, and requires exceptional quality of managers. It should be emphasized that quite frequently the advantages of flat structures, such as information flow and individual satisfaction, are offset by the advantages of narrow spans in faster and more effective problem resolution. There appears to be several positive effects on individual attitudes and behavior when the span of control is large. Employee morale will improve with a broader span since subordinates will be subjected to a lesser degree of detailed supervision. In fact, one of the worst aspects of a narrow span of control is the opportunity it gives a manager to harass his subordinates. Wider spans will generally entail more responsibility be given to subordinates, thereby making the job more fulfilling. At the same time, a flatter structure

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will provide more growth for the subordinates and create more reliance and trust from the supervisor.

UNIT-4 COMMUNICATION MEANING OF COMMUNICATION: According to Theo Haimann, communication is the process of passing information and understanding from one person to another.it is the process of imparting ideas and making oneself understood by another. ELEMENTS OF COMMUNICATION PROCESS: The communication process consists of the following steps 1. SENDER: The person who sends the message is known as the source. He initiates the process of communication. The sender may be a speaker, writer or an actor. 2. MESSAGE: Is the subject-matter of communication. It may contain facts, ideas or feelings. It exists in the mind of the reader. SENDER MESSAGE DECODING FEEDBACK ENCODING CHANNEL RECEIVER

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3. ENCODING: It is the act of translating the message into words, pictures, symbols, signs or others. 4. CHANNEL: It is the media through which the message passes from the sender to the receiver. Channel may be formal or informal. 5. RECEIVER: The person who receives the message is called the receiver. He may be a listener or observer. Receiver is also known as communicate. 6. DECODING: The receiver interprets the message to draw meaning from it. He converts symbols, signs or pictures into meaning. 7. FEEDBACK: It is the response, reaction or reply by the receiver. It is directed to the sender. When the sender receives the feedback, the communication process is said to be complete. IMPORTANCE OF COMMUNICATION: Communication is the responsibility of every executive to develop and maintain the system of communication. Major portion of the time is spent communicating. Without proper communication no organization can survive. ADVANTAGES OF SOUND COMMUNICATION: Improves managerial performances Communication enables a manager to diagnosis the various problem and to secure information for the decision making. Helps in logical planning , to organize systematically , to direct effectively and to control effectively. Facilitates leadership The modern concept of the leadership exercise through persuasion rather than command places a great premium on communication. Increases job satisfaction Develops interest and motivation in work by communicating effectively.

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Reduces time and effort Communication can be done through the reports etc. Such economy in

time and efforts help to ensure efficiency and effectiveness in the organization. Enhances Co-ordination Individuals working in the organization perform different duties and activities. It is necessary to integrate and unify these activities and human efforts. Help public relations A business enterprise comes in contact with several social groups, e.g., customers, shareholders, government and public. It must maintain harmonious relationship with these groups of external environment. CHANNEL OF TYPES OF COMMUNICATION A channel of communication is the path through which messages are transmitted from the sender to the receiver. Channels of communication may be formal or informal. FORMAL COMMUNICATION Formal communication follows the routes formally laid down in the organization structure of the enterprise. Formal channels are the paths of communication which are institutionally determined and which are associated with status and position of the sender and receiver. The formal channels are deliberately created to regulate the flow of communication. An attempt is made to make the flow of information orderly so that it flows smoothly and timely to the points where it is required. The officially prescribed path of communication is orderly in nature. Disadvantages in flow of formal communication: organizational distance screening at various points Narrow route Downward(Vertical communication) Upward(Vertical communication)

Three forms of formal communications,

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Horizontal

VERTICAL COMMUNICATION Downward communication: It refers to the flow of information from the superior to the subordinate (the orders).It also involves communication of policies procedures and programmes of the organization. Upward communication: It implies the flow of communication from subordinates to the superiors of the organization. It involves reports suggestions, recommendation, inquiries , appeals ,grievance etc. It generally improves the morale of the employees. Difference between downward and upward communication: Downward 1.From higher to lower levels 2.Flow is downwards 3.Directive in nature 4.Purpose is to get plans implemented 5.Travels fast 6.Orders, instruction lectures, manuals, handbooks etc. are the main examples HORIZONTAL COMMUNICATION: Transmission of information among the positions at the same level of the organization. Person with same status exchange information and ideas for achieving coordination among different departments or divisions. Such communication is also known as lateral or sideward communication. It takes the form of memoranda, letters, telephone talks, face-to-face contacts, and inter departmental committee meetings. Upward From lower to higher level Flow is upwards Non directive in nature Purpose is to provide feedback on results Travels slowly Reports, suggestions, grivences, protects, surveys are the main examples

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INFORMAL COMMUNICATION OR GRAPEVINE Informal communication or grapevine implies communication among people through informal contacts or relations. channels. Benefits of Informal communication: Informal communication is easier and faster than formal communication. It fills in the gaps existing in the formal communication system. It is a primary means of developing identification with the group and interest in work. It is the main source of information about the feelings and attitudes of employees. It also helps to satisfy the information needs of employees. It is a powerful medium to transmit messages at great speed. It can transmit confidential information, which is unavailable in formal channels. Informal channels partially replace and often supplement formal channels. When formal channels break down, informal channels are the only rescue and alternative. Finally, Informal channels prove to be more effective and are more human & homely. On the other hand, informal communication tends to carry inaccurate and baseless information. It contains rumours and gossips; the best way to deal with rumour is to supply true facts in face-to-face contacts. Grapevine has no definite origin and direction. Distinction between Formal and Informal communication Formal Communication 1. Official channels. 2. Deliberately planned and systematic. 3. Part of organization structure. Informal Communication 1. Unofficial channel. 2. Unplanned and spontaneous. 3. Cuts across formal relationship. It coexists with the formal communication system. People resort to informal communication when there are barriers in the formal

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4. Oriented towards goals and tasks of the Enterprise. 5. Impersonal. 6. Stable and rigid. 7. Slow and structured 6. 7.

4.

Directed towards goals and need

Satisfaction of individuals. 5. Personal and social. Flexible and instable. Fast and unstructured.

METHODS OF COMMUNICATION: There are three important types of communication media: 1) Oral Communication 2) Written Communication 3) Gestural Communication Each of there media may be used either exclusively or in combination with other media. ORAL COMMUNICATION: Oral Communication involves exchange of messages through spoken words. It may be take place (i) through mechanical devices like telephone. Face-to-face conversation is the most natural way of transmitting the message. it is very speedy and helps to interchange feelings and attitudes. This Communication may take place through lectures, group discussions, interview, committee meetings, broadcast and social gatherings. These days mechanical devices like alarm bell, telephone, intercom system etc., are becoming increasingly popular for communicating messages. MERITS: 1. 2. 3. Economical - Oral Communication is relatively less expensive both in terms of time and money. Personal touch - Oral Communication is more effective due to direct contact between the sender and the receiver. Speed - Oral Communication is faster as compared to written Communication.

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4. 5.

Flexibility - Oral Communication is more flexible because the mode of delivery and the tone can be adjusted according to the type of listener or the audience. Quick response - In Oral Communication, response or reaction to the message can be obtained on the spot.

DEMERITS: 1. Lack of record - Oral Communication does not provide an authentic and permanent record of Communication unless the conversation is tape-recorded.

2. Time Consuming - Oral Communication in the form of face-to-face talk may become time consuming and costly. 3. 4. 5. Lengthy message - If the subject - matter to be communicated is quite lengthy, Oral Communication may not produce satisfactory results. Physical distance - when there is a long physical distance between the speaker and the listener, Oral Communication may be ineffective. Misunderstanding - Oral Communication may be misunderstood or not heard due to mutual distant or suspicion between the speaker and the listener.

WRITTEN COMMUNICATION: Written Communication is transmitted through written words in the form of letters, circulars, memos, bulletins, instruction cards, manuals, handbooks, reports, returns etc. MERITS: 1. 2. 3. 4. 5. 6. Effectiveness - written messages are more carefully formulated than oral messages. Therefore, Written Communication tends to be a more dear and specific. Lengthy messages - Written Communication is more appropriate when the message is quite lengthy. Economical - Written Communication is cheaper when the sender and the receiver are situated at distant places. Repetition - Written Communication can be used again and again. Permanent record - Written Communication provides a reliable record for future reference. Better response - Response is generally well thought out to this communication because the receiver gets sufficient time to understand and evaluate the message.

DEMERITS: 1. Time Consuming - Written Communication requires greater time in the preparation and transmission of message.

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2. 3.

Expensive - As it takes long time to convey the message, Written Communication is more expensive. Inflexibility - A Written message once transmitted cannot be withdrawn, also for the rent message there is no scope left for making amends for inaccuracy that may have crept into it. Little secrecy - It is difficult to maintain complete secrecy about written messages. Lake of personal touch - Written Communications tends to be very formal and lack personal touch. Misunderstanding - If the Written Message is poorly drafted it may create confusion and conflict.

4. 5. 6.

GESTURAL COMMUNICATION: Communication through gestures or postures is known as Gestural Communications. It is often used to supplement Oral Communication. Gestural Communication is very useful in conveying feeling, emotions and attitudes. BARRIERS TO COMMUNICATION Communication is successful only when the receiver understands the message intended by the sender. Managers often complain that one of their greatest problems is communication breakdown. Specialists have made serious studies of this and have isolated certain factors that cause barriers to effective communication. They are: NOISE: Noise is the first and foremost barrier to communication. It means interference that occurs in a signal and prevents one from hearing sounds properly. Noise does not mean only this. It also encompasses many other factors that may exist at the end of sender as well as that of the receiver. The sender may resort to ambiguous or confusing signals. The receiver may mess up the message owing to inattention or may spoil decoding because of wrong or unexpected interpretation. The receivers prejudices may also come in the way of his understanding the message in the right spirit. Some of the sources contributing to noise are: Poor Timing - A last moment communication with deadline may put too much pressure on the receiver and may result in resentment.

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Inappropriate channel - Poor choice of channel of communication can also be contributory to the misunderstanding of the message. Network Breakdown - Sometime staff may forget to forward a letter or there may be professional jealousy resulting in closed channel.

LACK OF PLANNING: Communication is not a casual affair. Unfortunately many people take it lightly. The result is that the message to be sent across may not be carefully planned. There are innumerable examples of people who would give an ill-planned, long-winding lecture while a short presentation with tables or graphs would be sufficient. Such an event would turn into one of miscommunication. In the same way some people may not care to choose a suitable time and place that are so very necessary for effective communication. SEMANTIC PROBLEMS: Semantics is the systematic study of meaning. That is why the problems arising from expression or transmission of meaning in communication are called semantic problems. Oral or written communication is based on words. And words, limited in number, may be used in unlimited ways. The meaning is in the mind of the sender and also in that of the receiver. But it is not always necessary for the meaning in the mind of the sender to be the same as in the mind of receiver. CULTURAL BARRIERS: We live in a culturally diverse world. People will encounter individuals from different races, religions, and nationalities in their day to day encounters. There is oftenanxiety surrounding unfamiliar cultures and cultural differences often come up as communication barriers. The same category of words, phrases, symbols, actions, colours may mean different things to people of different countries or different cultural backgrounds.

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WRONG ASSUMPTIONS: Quite often we act on assumptions, without caring to seek clarification for them. We should make all possible efforts to maintain our goodwill and not act impulsively on assumptions. If, for example, a customer writes to us that he would like to visit our office or factory without telling us that he would like to be picked up and we assume that he will manage to come on his own it may lead to loss of goodwill. So it is necessary to be circumspect in such matters. SOCIO-PSYCHOLOGICAL BARRIERS: The attitudes and opinions, place in society and status consciousness arising from ones position in the hierarchical structure of the organization, ones relations with peers, seniors, juniors and family background -all these deeply affect ones ability to communicate both as a sender and receiver. Status consciousness is widely known to be a serious communication barrier in organizations. It leads to psychological distancing which further leads to breakdown of communication or miscommunication. Often it is seen that a man high up in an organization builds up a wall around himself. This restricts participation of the less powerful in decision making. In the same way ones family background formulates ones attitude and communication skills. EMOTIONS: Emotions play a very important role in our life. Both encoding and decoding of messages are influenced by our emotions. A message received when we are emotionally worked up will have a different meaning for us than when we are calm and composed. Anger is the worst emotion and enemy of communication. SELECTIVE PERCEPTION: Perception provides each of us with a unique view of the world a view some times related to, but not necessarily identical with that held by others. Selective perception means that the receivers selectively see and hear depending upon their needs, background, motivations, experience and other personal characteristics.

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While decoding the messages, most of the receivers protect their own interests and expectations into the process of communication leading to a particular kind of feedback that may become a communication problem. FILTERING: Filtering means that the sender of a message manipulates information in such a way that it will be seen more favorably by the receiver. A manager, for example, likes to tell his boss what he feels his boss wants to hear. In this process he is filtering information. The net result is that the man at the top never gets objective information. In the same way, the people at the lower levels condense and synthesize information so as to get maximum benefits for themselves. They hold back or ignore some important part of information. INFORMATION OVERLOAD: Unchecked inflow of information very often becomes another barrier to communication. When people are bogged down with too much information they are likely to make errors. They may also delay processing or responding to information/message and delay may become a habit, causing serious communication problems. FRAME OF REFERENCE: This is another barrier to clear communication. Every individual has a unique frame of reference formed by a combination of his experiences, education, culture, attitude and many other elements, resulting in biases and different experiences in a communication situation. POOR RETENTION: People are also likely to forget messages reaching them. There from arises the necessity to repeat the message and use more than one medium to communicate the same message. POOR LISTENING: Poor listening may lead to serious communication problems. Too many people are interested in talking, and mostly talking about themselves. They are so much involved

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with themselves that they do not have patience to listen. The result is that they are not interested in the speaker whose words go waste. Everybody knows about the importance of listening, but very few actually practise patient, active and empathic listening. That is why so many communication problems crop up. Poor listening accounts for incomplete information and also poor retention. One may simply not get the desired result if this keeps on happening.

OFFENSIVE STYLE OF COMMUNICATION: It is quite obvious that offensive style of communication leads to communication breakdown. It is a rather sensitive point. If a manager sends a message in such a way that the workers/juniors become defensive the relations get strained and communication suffers. Hence it is absolutely necessary for the management to adopt a persuasive style of communication. TRAITS OF A GOOD COMMUNICATION: 1. CLARITY OF MESSAGE: The message must be clear and free from all ambiguity. It should be encoded in the direct and simple language which the receiver can understand easily and quickly. 2. COMPLETENESS OF MESSAGE: The message must be adequate and complete. The process of communication must ensure that various individuals in the organization get all the required information for proper discharge of their duties. 3. CONSISTENCY OF MESSAGE: All messages must be consistent with the objectives, policies, and rules of the organization.

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4. PROPER TIMINGS: The communication system should ensure that the message reaches the receiver when it is required. The utility of the message depends upon its timeliness. 5. CREDEBILITY: Actions speak louder than words. Therefore, the communicator must follow in action what he says in a message. This will ensure believability and seriousness in communication. 6. EMPATHY: The format, the mode, frequency and the media of communication should not hurt the feelings of the communicates. 7. FOLLOW-UP: All communications should be followed up systematically. The communicator must try to ascertain through some signals whether or not he is properly understood. This is known as the principle of feedback in communication. 8. ECONOMY: The communication system must be economical keeping in view its efficiency. The cost of communication should be kept under check. UNIT-V DEFINITION OF CO-ORDINATION According to Henry Fayol to co-ordinate is to harmonize all the activities of a concern so as to facilitate its working and its success NATURE AND CHARACTERISTIC OF CO-ORDINATION co-ordination is not a distinct function but the very essence of management. It is a basic responsibility of management. Co-ordination does not arises spontaneously or by force. Heart of co-ordination is the unity of purpose.

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Co-ordination is a continuous or an on going process. Co-ordination is required in group efforts not in individual effort. Co-ordination is the responsibility of each and every manager.

PROBLEMS IN CO-ORDINATION INCREASE IN SIZE AND COMPLEXITY OF OPERATIONS SPECIALISATION Division of work into specialised functions and departments leads to diversity and lack of uniformity CLASH OF INTEREST Often individual fail to appreciate how the achievements of organisation goals will satisfy their own goal.

DIFFERENT OUTLOOK OF WORKING AND APPROACH TOWARDS

PROBLEMS CONFLICT BETWEEN LINE AND STAFF SPECIALIST EMPIRE BUILDING Some employees tend to over emphasis their own departments and sections. They try to get maximum possible share of total resources PERSONAL RIVALRIES Members from rival groups try to settle personal scores in organisation activities. Such rivalry is disastrous to teamwork. NEED AND IMPORTANCE OF COORDINATION EFFECIENCY AND EFFECTIVENESS

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Coordination helps to improve the efficiency of operations by avoiding overlapping efforts and duplication of work. Quality of coordination determines the effectiveness of organized efforts. UNITY OF DIRECTION Coordination helps to ensure unity of action in the face of disruptive forces. It helps unity of action and helps to avoid conflicts between line and staff elements HUMAN RELATION Coordination helps to improve team spirit and morale of employees. In a well coordinated organization, organizational goals and personal goals of people are reconciled. QUNITESSENCE OF MANAGEMENT Coordination is all inclusive concept and the end result of management process. Coordination helps in the accomplishment of organizational goals.

TYPES OF COORDINATION Coordination may be decided on different bases, On the basis of scope or coverage, coordination can be internal of external on the basis of flow, it is classified as vertical and horizontal and coordination may also be procedural and substantive INTERNAL AND EXTERNAL COORDINATION Coordination between the different units of an organization is known as internal coordination. External coordination refers to coordination between an organization and its external environment customers, investors etc. VERTICAL AND HORIZONTAL COORDINATION

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Vertical coordination implies coordination between different levels of organization. Vertical coordination is ensured by top management through delegation of authority. Coordination between different departments and other units at the same level of management hierarchy is called horizontal coordination. PROCEDURAL AND SUBSTANTIVE COORDINATION Procedural coordination implies the specification of the organization in itself. Substantive coordination is concerned with the content of the organizations activities. PRINCIPLES OF COORDINATION Mary Parker Follet has laid down four principles of effective coordination 1) DIRECT PERSONAL CONTACT Coordination is best achieved through direct personal contact with people. Direct face to face contact communication is most effective. 2) EARLY BEGINNING Coordination can be achieved more easily in early stages of planning and policy making. Plans should be based on mutual participation. Early coordiantin also improves the quality of plans. 3) RECIPROCITY It states that all factors in a given situation are interdependent and interrelated. When People appreciate reciprocity of relations, they avoid unilateral action and coordination becomes easier. 4) CONTINUITY It is an on-going or never ending process. Sound coordination resolves conflicts as it arises. TECHNIQUES OF COORDINATION Main techniques of effective coordination arE

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SOUND PLANNING Planning is the ideal stage for coordination. Clear cut objectives, harmonized policies and unified procedures and rules ensure uniformity of action.

SIMPLIFIED ORGANISATION A simple and sound organization is an important means of coordination. Clear cut authority relationships help to reduce conflicts and to hold people responsible.

EFFECTIVE COMMUNICATION Open and regular communication is the key to coordination. Effective interchange of opinions and information helps in resolving difference and in creation mutual understanding.

EFFECTIVE LEADERSHIP AND SUPERVISION Effective leadership ensures coordination both at the planning and the execution stage. Sound leadership can persuade subordinates to have identity of interest and too adopt a common outlook.

CHAIN OF COMMAND Authority is the supreme coordinating power in an organization. Exercise of authority through the chain of command or hierarchy is the traditional means of coordination.

VOLUNTARY COORDINATION When every organizational unit appreciates the working of related units and modifies its own functioning to suet them, there is self coordination. It is possible in a climate of dedication and mutual cooperation.

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MEANING OF CONTROL Controlling may be defined as the process of analysing actual operation seeing that actual performances is guided towards expected performance. NATURE AND PURPOSE OF CONTROL Main characteristics of control 1) Essential function of management 2) Ongoing process 3) Forward working 4) Involves measurement 5) The essence of control is action 6) Control is an integrated system ELEMENTS OF CONTROL 1) Planning 2) Information feedback 3) Delegation of authority 4) Remedial action NEED FOR CONTROL Control is an indispensable function of management. A manager cannot do the complete of managing without any control. Organizational activities are directed towards the attainment of pre-determined objectives through control. Management ensures that resources are obtained and utilized economically and efficiently for the accomplishment of organizational objectives through control. THE CONTROL PROCESS 1. Fixation of standards: Standards of desired performance should be established. It serves as the criteria by which actual results are to be evaluated. Different standards are set up for various operations. Standards should be accurate, precise, objective, acceptable and workable. 54

They should be flexible. They should be measurable. Desired level of performance should be reasonable and feasible. It should be in terms of range maximum and minimum so as to maintain flexibility.

THE CONTROL PROCESS

Meets standards Standards (Planning) Performanc e

Operations (organizing and directing)

Does not meet standards

Corrective action

2. Measurement of performance. After fixation of standards, the actual performance of various individuals, groups and departments is measured. It involves setting up the methods of collecting accurate and up-to-date information on the progress of, work. Performance should be measured in quantitative terms. Measurement of performance against standards should be on a future prevent them. basis so that deviations are anticipated and necessary corrective actions are taken to

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3. Comparing performance standards: The actual results are compared with standards to check deviations, if quantitative terms. When deviations are beyond permissible limits, an analysis is made to identify the cause of deviations. The deviations and their causes are reported to the manager and he will take the necessary corrective actions. Only exceptional deviations are reported to the top management. Reports should be clear. They should not only show results but also reasons. any.

Such comparisons are if the standards and actual performance are expressed in

4. Correction of deviations: The final step in the control process involves taking corrective action so that deviations do not recur. Corrective action may involve review and revision of goals or standards, change assignment of tasks, provision for additional resources or new facilities, improvement in the selection and training of workers or reform in the techniques of direction. It requires changes in all other managerial functions. This shows the unity of the managers job and the integrated nature of management process PROBLEMS IN CONTROL PROCESS 1. MAGNITUDE OF CHANGE: control system is designed to cope with changes of a certain magnitude. The corrective actions are programmed into the decision rules of the foremen. 2. TIME RATE OF CHANGE: due to time lag in feedback, the control system cannot respond quickly to change in the situation .as a result there is slow down in the adaptive process. 3. ERRONEOUS STANDARDS: A mistake in setting standards is perhaps the most critical problem in a control system. 4. WORKERS RESISTANCE: opposition arises at every step in the control process.

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5. COMMUNICATION PROBLEMS: semantic and other barriers to communication can distort the information flow. CHARACTERISTICS OF AN IDEAL CONTROL SYSTEM 1. SUITABLE: The control system should be appropriate to the nature, needs, and circumstances of the enterprise and each level of activity inside it. 2. FLEXIBLE: Only a flexible system can be pragmatic or critical. 3. ECONOMICAL: The control system must be worth its cost and should justify the expenses involved. 4. SIMPLE: Control system should be easy to understand and simple to maintain. 5. OBJECTIVE: A sound control system must be objective and impersonal rather than subjective and arbitrary. 6. PROMPT: deviations in the control system must be reported quickly. 7. FORWARD LOOKING: a control system is ideal only when it points outs deviations even before they take place. 8. SUGGESTIVE: solutions to the problems caused by the deviations should also be indicated. 9. STRATEGIC POINT CONTROL: a good control system should focus attention on critical or key points that need to be regulated. 10. MOTIVATIONAL: control system should aim at motivating people by fulfilling their needs.

UNIT-VI TECHNIQUES OF MANAGEMENT MANAGEMENT BY OBJECTIVE: Management by objective (MBO) is known by several names e.g., management by objective, Management by goals and results, Goals management etc. In 1954 Peter F. Drucker suggested the concept of Management by objectives and self control. Later several pioneers suggested the use of MBO for performance appraisal, for long-range planning and for integrating the individual with the organization. As management philosophy MBO has now become a way of life for business managers.

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Concept of MBO: MBO has be defined as a process whereby superior and subordinates jointly identify the common objectives, set the results that should be achieved by the subordinates, assess the contributions of each individual in terms of the results expected of him, and integrate individuals with the organization so a to make best use of organizational resources. The forgoing definition reveals the following characteristics of MBO: 1. 2. 3. 4. MBO is both a philosophy and a technique of management. MBO is a goal-oriented process and not a work-oriented process. Self-direction and self-control are the built-in features of MBO. It lays down an evaluative mechanism through which the contribution of each individual is measured. 5. Under MBO a linkage is created between organizational goals and individual goals. 6. Performance of individual is periodically evaluated in the light of pre-determined targets. 7. MBO is a continuous process or a never-ending process.

STEPS IN MBO PROCESS: The main steps in the process of MBO are as follows: 1. Setting Objectives: The first step in installing the MBO system is to establish verifiable objectives for the organization as a whole and for various positions in the organization. Under MBO, objectives are established in several stages. First, top management sets the goals for the total enterprise in certain key areas. Second, objectives for each department are laid down in consultation with the department heads. Then this process of goal-setting is repeated at lower levels of management until goals for each and every individual are established. The superior must play a supportive role in helping his subordinates to develop

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consistent and feasible objectives for themselves. The goal-setting process is complete when agreement is reached between superior and subordinates as to what is to be accomplished and why. 2. Developing action plans: Once the goals are established, responsibility for the achievement of each goal is specified. Job descriptions for various positions must define the goals to be attained. Resources required for goals attainment are identified and allocated. Then the means for the implementation of plans are decided. Goals and resources must be matched together. 3. Conducting periodic reviews: At frequent intervals actual performance is reviewed jointly by the superior and the subordinates. Such periodic evaluation progress serves as a checkpoint. If necessary, the goals are modified. Ways and means are identified to overcome problems and to improve performance in future. 4. Appraising annual performance: A thorough evaluation of individual performance is done at the end of the year. At annual reviews, achievements are carefully analyzed against the given objectives. Rewards are decided on the basis of annual appraisal. Thus, the MBO process comprises preliminary goal-setting, setting subordinates objectives, matching goals with resources, recycling objectives and periodic appraisal of performance.

THE MBO PROCESS

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1. SETTING OBJECTIVES

4. APPRAISING ANNUAL PERFORMANCE

2. DEVELOPING ACTION PLANS

3. CONDUCTING PERIODIC REVIEWS

MANAGEMENT BY EXCEPTION:

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It is a management style wherein managers intervene only when their employees fail to meet their performance standards. If the personnel are performing as expected, the manager will take no action. The term is also used to describe provision of information to management in which only significant deviations from budgets or plans are reviewed as the basis for corrective action. The object is to reduce the quantity of detail contained in management reports and statistics to date on which action can be taken. Advantages of MBE: It saves the time of managers because they deal only with exceptional matters. It focuses managerial attention on major problems. It facilitates delegation of authority. It keeps management alert to opportunities and threats. It provides better yardstick for judging results.

Limitations of MBE: Non critical and non exceptional areas may be crucial and may damage the system before remedial action is taken. Subordinates may misuse the permissive atmosphere.

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Trends In Management

Tourism Management Dynamics As the global tourism industry continues to expand and to become more complex, it is vital that those in the industry identify trends early and design proactive strategies to gain competitive advantage. Tourism Futures: dynamics, challenges and tools helps one with a comprehensive insight of the changes in the external business environment, and equips them with new managerial techniques and tools in order to adapt and profit from these changes and into the future. It provides the manager of tomorrow with the ability to look beyond normal planning horizons and identify potential opportunities from change. Quality control method, quality control support system and trend management program for manufacturing operation A product quality control method for a manufacturing operation comprising: storing part-by-part data related to equipment used in a manufacturing process in a storage device using an inputting device; outputting the stored data from the storage device via a processing device to an outputting device as a quality maintenance matrix; measuring characteristic values of a product manufactured by implementing an inspection and manufacturing operation based on the quality maintenance matrix, and additionally storing the obtained characteristic values in the quality maintenance matrix; performing factor analysis on a part related to the quality characteristic item showing an impermissible characteristic value in the above measurement and setting new conditions so as to improve the impermissible characteristic values and storing the quality maintenance matrix revised by the newly set conditions; implementing an inspection and manufacturing operation based on the thus revised quality maintenance matrix prepared in the first step.

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Brightsizing-new technique in management: Management trends come and go. They are good or bad depending on many variables: industry; company culture; education level of workers; existing contracts and laws; etc. Mostly, however, they are good or bad depending on how well they are applied. Re-engineering is a solid business management tool, but applied incorrectly it can cause more harm than good. Downsizing, when done improperly, is appropriately called dumbsizing. The latest management buzzword isn't really a trend. It is more a reaction to the last few trends. The new buzzword is brightsizing. While it provides more opportunity for comic relief, courtesy of Dilbert, it is no laughing matter. Brightsizing is downright dangerous and you need to protect your organization from it. Brightsizing is defined, by Paul McFedries, as "corporate downsizing in which the brightest workers are let go. This happens when a company lays off those workers with the least seniority, but its those young workers who are often the best trained and educated." Sometimes brightsizing is blamed on union contracts, which enforce seniority-based hiring/firing practices. It is, unfortunately, just as common in non-union companies. Many companies have policy statements in their employee handbooks that state that in layoff decisions "among equally qualified candidates preference will be given to the employee with the greatest seniority." When faced with decisions that will result in a reduction in staff, make sure you first evaluate the value of the employee to the organization and THEN look at other mitigating factors, such as length of time with the company. For example: One company I worked with kept an individual with them because he was one of their first employees. They kept finding jobs he could do as the company grew rapidly and outgrew his capabilities.

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Eventually, they made him responsible for picking up dignitaries at the airport and bringing them to the office. While I believe in company loyalty and retraining employees, you have to draw the line somewhere based on performance and value to the company. The driver had gotten old, was nearly blind, and could not even converse socially with the dignitaries he picked up. He did not make a good first impression for the company. This individual, incidentally, became an even greater liability to the company because he never adjusted to the changing social rules on interpersonal conduct. His remarks and actions were usually dismissed because "hes just a harmless old man", but the potential for a harassment lawsuit was significant. Remember, your first obligation is to the health of your company, not to any individual. While it is important that you respect your employees as a group, and always treat them fairly, you can not sacrifice the company for any individual. If the company suffers as a result of poor personnel decisions on your part, it may result in further downsizing and more employees would have to be released.

Recommended Text Books: Koontz O.Donnell ,Principles Of Management, McGraw Hill Peter Druker The Practice of Management, Allied Publications Louis.A.Allen,: Management and Organization, McGraw Hill

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