Management

Fundamentals
Editing By

Gio
 Index

1. Management
 Management A Profession
 The Importance Of Management
 What is Management
 Definition Of management
 Management & Organizational Resources
 Management Functions & Process
 Management Roles
 Management Skills
 Management , Science Of Art
 The Universality Of Management
2. Planning
 Definition Of Planning
 Purposes Of Planning
 Primacy Of Planning
 Steps In Planning Process
 Organizational Objectives Or Goals (Planning Function)
 Types Of Goals
 Types Of Plans
 Planning Tools & Techniques
3. Decision - Making
 Defining of Decision
 Types of Decision
 The Decision – Making Process
 The Decision – Making Steps
 Decision – Making Conditions
 The Pervasiveness Of Decision Making
 Planning
 Organizing
 Leading
 Controlling
4. Organizing
 Definition Of Organizing
 Some Purposes Of Organizing
 The Organizing Process
 Organizational Structure
 Organizational Design
 Work Specialization
 Departmentalization
 Chain Of Command
 Span Of Control
 Centralization & Decentralization
 Formalization
5. Influencing
 Definition Of Influencing
 The Influencing Sub System
 Leading
 Motivating
 Considering Groups
 Communicating
 Interpersonal Communication
 Organizational Communication
6. Leadership
 Definition Of Leadership
 Leader vs. Manager
 The Trait Approach to Leadership
 The Situational Approach to Leadership
 Determining How to Make Decision as a Leader
 The (VYJ) decision style
 The (OSU) decision style
 The Michigan studies
 Effectiveness of various Leadership Styles
7. Motivation
 Definition Of Motivation
 Strategies for motivating organization members
 Managerial Communication
 Theory X – Theory Y
 Job Design
 Behavior Modification
 Likert’s Management Systems
 Monetary Incentives
 Non-Monetary Incentives
 Considering Groups
 Kinds of Group in Organizations
 Formal Groups
 Informal Groups
8. Controlling
 Definition Of Controlling
 The Controlling Process
 Measuring performance
 Comparing measured performance to standards
 Taking corrective action
 Types Of Control
 Pre-control of feed forward control
 Concurrent control
 Feedback control
 Qualities of an Effective Control System
 Management
• Management a Profession
to act loyally and honestly in carrying out the policy of the organization and not
undermine its image or reputation
1. To accept responsibility for their own work and of their subordinates .
2. Not to abuse their authority for personal gain .
3. Not to hurt or attempt to injure the professional reputation, prospects, or business
of others .
4. Always to comply strictly with the law and operate within the spirit of the law .
5. To order their conduct so as to uphold the dignity, standing and reputation of the
institute .
• Definition
management is a process of reaching organizational goals by working with and
through people and other organizational resources.
it’s also the process of coordinating work activities so that they’re completed
effectively and efficiently completing with and through people and other resources
there’s three main characteristics
1. It’s a process or series of continuing and related activities
2. It involves and concentrated on reaching organization goals
3. It reaches these goals by working with and through people and other
organizational resources .
the process represents the ongoing functions or primary activities engaged by
mangers
¤ Efficiency
“Do things right” it’s getting the most output from the least amount of input .
Because managers deal with scarce inputs (people, money, equipment) they’re
concerned with the efficient use of resources and not wasting them .
¤ Effectiveness
“Do the right things” the work activities help the company to reach its goals or it’s
completing activities so that the organizational goals are attained
efficiency is concerned with the means of getting thongs done, effectiveness is
concerned with the ends, or attainment of organizational goals .

)Efficiency (means Effectiveness (ends)

Resource Goal
Usage Attainment

Low Waste High Attainment

Management strives for

)Low resource waste (high efficiency
)High goal attainment (high effectiveness
• Management and Organizational Resources
These resources composed of all assets available for activities during the
production process, are of four basic types
1. Human Resource
the people who work for company . Their skills and knowledge of the work system
are invaluable to managers .
2. Monetary Resources
are amount of money that managers use to purchase goods and services for the
company
3. Raw Materials
are ingredients used directly in the manufacturing of product
4. Capital Resources
are machines used during the manufacturing process. Modern machines can be
major factor in maintaining desired production levels and to keep pace with
competitors

Organizational
Finished
Resources
Products
People Inputs Production Outputs
Money Process Goods
Raw materials
Services
Capital
• Management Function and Process
» Planning
» Organizing
» Leading
» Controlling
management process is the set of ongoing decisions and work activities in which
managers engaged as they plan, organize, lead, and control .
• Management Roles
managers perform a lot of different but high interrelated roles
1. Management roles
it’s the specific categories of managerial behavior
1. The interpersonal roles
are roles that involves people (subordinates and persons outside the company) and
other duties that are ceremonial and symbolic in nature
1. The informational roles
Involves receiving collection, and disseminating information.
1. The decisional roles
revolve around making choices and includes roles as businessman, disturbance
handler, resource allotment, and negotiator.
• Management Skills
1. Technical Skills
include knowledge of and proficiency in a certain specialized field . These skills
are more important at lower levels of management since these managers are
dealing directly with employees doing the company work
2. Human Skills
it’s the ability to work well with other people. managers knows how to
communicate, motivate lead, and inspire enthusiasm and trust. These skills are
equally important at all levels of management
3. Conceptual Skills
are the skills managers must have to think and to conceptualize about abstract
and complex situation. These skills are most important at the top management
level Management Skills
Levels Needed

Needs
Top Conceptual
Mana- Skills
gement

Middle Needs Human

Management Skills

Supervisory or Needs Technical

Operational Management Skills
• How do we define who managers are
» Manager
is someone who works with and through other people by coordinating their work
activities in order to accomplish organizational goals
» First-line Managers
are managers at the lowest level of the company who manage the work of non-
managerial employees who are involved with the production or creation of the
company’s products.
» Middle Managers
include all levels of management between the first-line level and the top level of
the company . These managers manage the work of first-line managers and may
have titles such as department head, project leader, plant manager or division
manager.
» Top Managers
are responsible for making organization-wide decision and establish the plans and
goals that affect the whole company . These individuals typically gave titles such
as executive vice president, president, managing director, chief operating officer,
chief executive officer, or chairman of the board.
• Management Universality
management is needed in all types and sizes of organizations, at all organizational
levels, in all organizational work areas, and in all companies, no matter in what
country they’re located.
All Sizes of
Organizations
Small Large

All Organizational Areas

Manufacturing-Marketing All Types of
Human Resources Management is
…..Needed in Organizational
Accounting Information Profit not-for Profit
System….

All Organizational
Levels
Bottom Top
 Planning
• Definition
Planning is establishing an overall strategy for achieving the organization’s goals
and developing a comprehensive set of plan to integrate and coordinate
organizational work .It’s concerned with both ends (what’s to be done) and means
(how it’s to be done) .
• Planning Purposes
1. Planning gives direction .
2. Reduces the impact of change .
3. Minimizes waste and redundancy .
4. Sets the standards used in controlling .
• Planning Process Steps
1. State the organizational objectives .
2. List alternative ways of reaching objectives .
3. Develop premises how and which alternative to be based .
4. Choose the best alternative for reaching objective .
5. Develop plans to pursue the chosen alternative .
• Organizational Objectives or Goals (Planning’s Function)
1. Organizational Objectives
targets toward which the open management system is directed. Properly developed
organizational objectives reflect the purpose of the organization .
2. Organizational Purpose or Mission
is what the organization exists to do, given a particular customer group and customer needs .
• Organizational Objectives Areas
1. Market standing-Management :set objectives to clarify the relation with competitors .
2. Innovation-Management :set objectives explain the ways to develop a new operation methods.
3. Productivity-Management : set objectives to show the production target levels .
4. Physical and financial resources-Management : set objectives of the good using of acquisition, and
maintenance of capital and monetary resources .
5. Profitability-Management : set objectives to specify the profit the company would like to generate .
6. Managerial performance and development-Management : set objectives that specify rates and levels of
managerial productivity and growth .
7. Worker performance and attitude-Management : set objectives that specify worker productivity rates as well
as desirable attitudes for worker to possess .
8. Public responsibility-Management : set objectives explain the company’s responsibilities to its customers
and society and shows the company’s seriousness to live up to those responsibility.
• Goals Types
1. Stated Goals
are official statements of what the company says, and what it wants its
stakeholders to believe about the goals. They can be found in an organization’s
charter, annual reports, or managers public statements.
2. Real Goals
are goals that a company actually pursues-closely show what organizational
members are doing .
Compare between Financial and Strategic Objectives
Financial Objectives Strategic Objectives
» Faster revenue growth » A bigger market share
» Faster earning growth » A higher more secure industry rank
» Higher profit margins » Higher product quality
» Higher return on invested capital » Lower costs relative to key competitors
» Stronger bond and credit » More attractive product line
» Bigger cash flows » A stronger reputation with customers
» Arising stock price » Superior customer service
» A more diversified revenue base » Recognition as leader to complete in
» Stable earnings during recessionary international markets
periods
• Plans Types
A. Types Plans according to their Breadth
2. Strategic Plans
are plans that apply to the whole company ,establish the overall goals and seek to
position the company in its environment terms
2. Operational Plans
are plans that specify the details of how to achieve the overall goals
Compare between two Types
Strategic plans covers the a longtime frame and broader of the company , and also
include the formulation of goals because operational plans define ways to achieve
the goals . Operational plans covers the short time periods (monthly, weekly, and
day to-day)
B. Plans Types according to Timeframe
1. Long-term Plans
plans with a time frame three years and more
2. Short-term Plans
one year or less
3. Intermediate Plans
is any time in between
C. Plans Types according to Specificity
1. Specific Plans
are clearly defined . They have specifically stated objectives . There’s no uncertain
and no problem with misunderstanding .
2. Directional Plans
are flexible plans that set out general guidelines .
D. Plans Types according to Use Frequency
1. A single-use Plans
is a one-time plan specifically designed to meet the needs of a unique situation .
2. Standing Plans
are plans provide direction for activities performed repeatedly, and include
policies, rules ,and procedure .
• Planning Tools and Techniques
1) Environment Assessing Techniques
B. Environmental Scanning
is the screening a large amounts of information to anticipate and interpret changes
in the environment .
B. Forecasting
this can used by managers to assess the environment is forecasting. Forecasting
is an important part of organizational planning. Environment scanning creates the
foundation for forecasts, which are predication of outcomes
Forecasting Techniques
• Quantitative Forecasting
applies a set of mathematical rules to a series of past data to predict outcomes.
These techniques are preferred when managers have sufficient hard data that
can be used .
• Qualitative Forecasting
it uses the judgment and opinion of knowledgeable individuals to predict
outcomes. it’s used when precise data are limited or hard to obtain.
• Benchmarking
this is the search for the best practices between competitors or non competitors
that lead to their superior performance . The basic idea behind benchmarking is
that managers can improve quality by analyzing and then copying the methods of
the leaders in various fields .
2) Resources Allocating Techniques

resources are the assets of the company and include

 Financial (debt, equity, retained, earning, and other financial holdings ).
 Physical (equipment, building, raw materials, or other real assets ).
 Human (experiences, skills, knowledge, and qualification of people ).
 Immaterial (brand name, patents, reputation, trade marks, copy right, registered
designs, and databases, structural ).
 Cultural (history, culture, work system, working, relationships, levels of trust,
policies, and structure ).
and there is four techniques
• Budgeting
is a numerical plan for allocating resources to specific activities . Managers
typically prepare budget for revenues, expenses, and large capital expenditures.
• Scheduling
is detailing what activities have to be done, and which they’re to be completed,
who’s to be each, and when . Some useful scheduling devices are Gantt, Load
charts, and PERT network analysis .
Cash Budget
Forecasts cash on band Revenue Budget Expense Budget
and how much will be Project future sales Lists primary activities and allocate
needed monetary amount to each

Variable Budget Fixed Budget

Takes into account the costs that vary with Assumes fixed level of sales or production
volume

Profit Budget
Combines revenue and expense budget of various units
to determine each unit’s profit contribution
• Break-even Analysis
is a technique for identifying if only the total revenue is just sufficient to cover total
cost . It points out the relationship between revenues, costs, and profits .
• Linear Programming
is a mathematical technique solves resource allocation problems .
 Decision-Making
• Definition
Decision is choice made between two or more available alternatives .
Decision-Making is process of choosing the best alternative to reach objectives.
• Decisions Types :
1. Programmed Decision
are routine and repetitive, and the company develops specific ways to handle them
.
 Procedure
It’s a series of interrelated sequential steps that manager can use for responding
to a structured problem .
 Rule
It’s clear statement that tells manger what he can do . Rules used for facing a well-
structured problem because they are simple to follow and ensure consistency
stability . ex. Rules about lateness and absenteeism .
 Policy
put guidelines to limit manager’s thinking in specific direction . Different from rule,
policy establish parameters for decision maker rather than specifically stating what
should or should not to be done
2. Non-Programmed Decision
are typically one-shot decision that are usually less structured than programmed decision .
• The Decision-Making Process : the decision-making process include the steps for
decision maker to arrive at this choice .
The decision-making steps
1. Identifying an existing problem
¤ Orders issued by managers or supervisors .
¤ Situations relayed to managers by their subordinates .
¤ The normal activity of the managers themselves .
2. List alternative solution
before searching for solutions managers should be aware of five limitations on the number
of problem-solving alternatives available :
¤ Authority factors (manager’s superior may gave told the manager that may be a certain
alternative is not feasible ) .
¤ Biological for human factors (human factors inside the company may be not fit for carry out
certain alternatives ) .
¤ Physical factors (the physical facilities of the company may be not fit for certain
alternatives ) .
¤ Technological factors (the level of company technology may be not fit for certain
¤ alternatives ) .
¤ Economic factors (certain alternatives may be too costly for the company ) .
3. Selecting the most beneficial alternative
the evaluation should consist of three steps
® first : decision maker should list the potential effects of each alternatives
® Second : they should assign a probability factor to each potential effects to show
how probable the effect occurrence would be if the alternative were carried out .
® Third : keeping company goals in mind, decision maker should compare each
alternative’s expected effects and the respective probabilities of those effects .
after completed this steps. Manager the most advantageous of alternative to the
company .
4. Implementing the chosen alternative
put the chosen alternative into action . Decision must be supported by appropriate
action to have a chance of success .
5. Evaluating decision effectiveness
decision makers must gather feedback to determine the implementing alternative
effect on the identified problem . If the identified problem is not being solved,
managers need to search out and implement some other alternative .
• Decision-Making Conditions
* Complete Certainty Condition
It’s the decision-making situation in which the decision maker knows exactly what
the results of a carried out alternative will be .
* Complete Uncertainty Condition
Used if the decision maker has no idea about the results of carried out alternative .
* Risk Condition
It means the decision maker has only enough information to estimate about the
implemented alternatives outcome .
• The Decision-Making Pervasiveness
Θ Plan
Θ Organize
Θ Lead
Θ Control
 Organizing
• Definition
Organizing is the process of establishing orderly uses for all company’s resources.
It’s also the process of creating a company’s structure . The challenge for
managers is to design an organizational structure that allows employees to
effectively and efficiently do their work .
• Some Organizing Purposes
◙ Divides work into specific jobs and department .
◙ Assign tasks and responsibilities associated with individual jobs .
◙ Coordinate diverse organizational tasks .
◙ Cluster jobs into units .
◙ Establish relationships among individuals, groups, departments .
◙ Establish formal lines of authority
◙ Allocates and deploys company all resources .
• The Organizing Process
1. Reflect the company’s plan and objectives .
2. Establish major tasks .
3. Divides major tasks into subtasks .
4. Allocate resources and directives for subtasks .
5. Evaluate the result of implemented organizing strategy .

Step 1:
Step 2:
Reflect on plans
Establish major tasks .
and objectives .

:Step 5 Step 3:
Evaluate results of Divides major tasks
.Organizing strategy Into sub tasks .

Step 4 :
Allocate resources and
Directives for subtasks .
• Organizational Structure
Is the formal framework about job tasks dividing, grouping, and coordinating .
When managers develop or change an organization’s structure, they are engaged
in organizational design .
• Organizational Design
Is a process involves decisions about six key elements
1. Work Specialization
Describes the degree to which tasks in an company are divided into separate jobs.
It’s also meaning not done by one individual . But is broken down into steps and
each one is completed by different person . Individual employees specialize in
doing part of an activity rather than entire activity .
2. Departmentalization
Is the basis by which job are grouped together .
There are five common forms of departmentalization
Θ Functional departmentalization
Θ Product departmentalization
Θ Geographical departmentalization
Θ Process departmentalization
Θ Customer departmentalization
 Cross-Functional Teams : are groups of individuals who are experts in various
specialties and who work together .
3. Chain Of Command
is the continues line of authority that extends form upper organizational levels to the
lowest levels and clarifies who reports to whom .
¤ Authority : involves the rights inherent in a managerial position to tell people what to
do and to expect them to do it .
¤ Responsibility : involves the obligation of employees to perform any assigned duties
as managers coordinate and integrate the work of employees .
¤ Unity Of Command : it helps preserve the concept of a continuous line of authority . It
states that a person should report to only one manager .
4. Span Of Control
The contemporary view of span of control notices that many factors influence the
appropriate number that a manager can efficiently and effectively manage .
¤ Employee tasks similarity .
¤ Tasks complexity .
¤ The degree of standardized procedure placing .
¤ The company’s information system sophistication .
¤ Company’s culture strength .
¤ Manager preferred style .
5. Centralization and Decentralization
Centralization
Describes the degree to which decision-making concentrated at a single point in
the company . If top managers make the company’s key decisions with little or no
inputs from below then the organization is centralized
Decentralization
Allows lower-level employees provide input or actually make decision .
Centralization and Decentralization Factors
More Centralization
• Environment is stable
• Lower level managers are not as capable or experienced at making decisions as
upper level managers .
• Lower-level managers do not want to have a say in decisions .
• Decisions are significant .
• Organization is facing a crisis or the risk of company failure .
• Company is large
• Effective implementation of company strategies depends on managers retaining
say over what happens .
 More Decentralization
• Environment is complex, uncertain .
• Lower-level managers are capable and experienced at making decision .
• Lower-level managers want a voice in decision .
• Decisions are relatively minor .
• Corporate culture is open to allowing managers to have a say in what happens .
• Company is geographically dispersed .
• Effective implementation of company strategies depends on managers having
involvement and flexibility to make decision .
6. Formalization
shows the degree to which jobs in company are standardized and the extent to
which employee behavior is guided by rules and procedures .
 Influencing
• Definition
Influencing is the process of guiding the activities of company members in
appropriate directions .
Appropriate Directions
Are those that lead to the attainment of management system objectives .
• The Influencing Subsystem
1. Leading .
2. Motivating .
3. Considering groups .
4. Communicating .
 Inputs
1. People .
2. Money .
3. Raw materials .
4. Machines .

Processes
Influencing Process

Considering
groups

Leading Motivating

Output appropriate organization members behavior

» Communication
It’s the process of sharing information with individuals . In general, communication
involves one person projecting a message to one or more other people that result
in everyone’s arriving at a common understanding of the message .
» Interpersonal Communication
It’s the process of transmitting information to others .
1) The Source / Encoder
It’s the person in the interpersonal communication situation who originates and
encodes information to be shared with others .
2) The Signal
The message that has been transmitted from one person to another is called
signal (encoded information used to share constitutes a message) .
3) The Decoder / Destination
It’s the person or persons who the source tries to share information with .
Decoding
It’s the process of converting messages back into information .
» Feedback and Interpersonal Communication
feedback is the destination’s reaction to a message . Feedback can used by
source to ensure successful communication .
» Interpersonal Communication Types
1. Verbal Communication
It’s the sharing of through words (written or spoken)
2. Nonverbal Communication
It’s the sharing of information without using words to encode thoughts (gestures,
vocal tones, and facial expressions)
» Organizational Communication
Is the interpersonal communication within organization .Organizational
communication directly relates to the goals, function, and human organizations
structure .
» Formal Organizational Communication
It follows the organization chart lines .
» Formal Organizational Communication Types
1. Downward Organizational Communication
it flows form any point on an company chart downward to another point on the
company chart .
2. Upward Organizational Communication
it flows from any point on company chart upward to another point on the chart .
3. Lateral Organizational Communication
it flows from any point on chart horizontally to another point on chart .
 Leadership
• Definition
Leadership is the process of directing the behavior of others toward the
accomplishment of some objective or objectives .
• Leader Versus Manager
leading is not like managing . But some managers are leaders and some leaders
are mangers, leading and managing have not the same activities.
Managing is much wider in range than leading and focuses on both
non-behavioral and behavioral issues .
Leading emphasizes mainly behavioral issues .
• The Trait Approach to Leadership
leadership shows the personal characteristics of an individual as the main
determinates of how successful that individual could be as a leader.
management writer agree that leadership ability can’t be explained by individual
traits or inherited characteristics, they believe that individual can be trained to be
good leaders .
• Situational Approach to Leadership
It suggests that leadership style must be matched to the situation the leader faces.
• Leader Decision-Making
(Vroom – Yetton – jago) the VYJ theory is built on two premises
1. Organizational decision should be of high quality (should have beneficial impact on
performance)
2. Subordinates should accept and be committed to organizational decisions that are
made.
Decision Style
The VYJ model suggests that there’re five different decision styles or ways that
leaders can make decision . These styles range from authority (the leader makes
the decision) to consultative (the leaders makes the decision after interacting with
the followers) to group-focused (the managers meets with the group and the group
makes the decision .
The VYJ model, is method for determining when a leader should use which
decision style .
Decision style Definition

AI - Managers makes the decision alone.

- Manager asks for information from subordinates but makes

AII the decision Subordinates may or may not be informed about
what the situation is.

- Managers shares the situation with individual subordinates and

asks for information and evaluation
CI - Subordinates do not meet as group, and the managers alone makes
the decision.

- Manager and subordinates meets as group to discuss the situation,

CII but manger makes the decision.

,Manager and subordinates meet as a group to discuss the situation-

GII and the group makes the decision.

A = authority C = consultative G = group

• Leadership Behavior
It concerned about what good leaders do. Are they concerned on keeping task
done. Or make their followers happy and having high morale.
• The Ohio state University (OSU)
There’s two main types of behavior
1. Structured Behavior
It’s the activities that
(1) determinates the relationship between the leader and his followers
(2) establishes well-defined procedure that the followers should conform to in
doing their jobs.
2. Consideration Behavior
It reflects friendship, mutual trust, respect, and warmth in the relationship between
leader and followers.
Leadership Style
Used by leader to establish the way of guiding the organization members in
specific direction.
 High
Low High
Structure Structure

High High
Consideration

Consideration Consideration

Low High
Structure Structure

Low Low
Consideration Consideration
Low

Low High

structure
• The Michigan Studies
It says there’s two basic types of leading behavior
• Job-Centered Behavior
It focuses on the subordinates work and performance.
2. Employee-Centered Behavior
It focuses on subordinates humanity (as people) and cares about personal needs
and team player.
• Effectiveness of various leadership styles
The desirable leadership behavior is associated with high leader emphasis on both
structure and consideration and the undesirable leadership behaviors is
associated with low leader emphasis on both dimensions. The most effective
leadership style noticed in high consideration and high structure. Results of a more
recent studies shows that high consideration is always preferred by subordinates.
• Comparing Styles
one shows that any single leadership style is more effective than any other. The
successful leadership style for managers in one situation may prove ineffective in
another situation.
 Motivation
• Definition
Motivation is the inner state makes everyone in company behaves in a way that
ensures the accomplishment of some jobs .
• Motivating Organization Members Strategies
There’s seven strategies
1. Managerial communication .
2. Theory X – Theory Y .
3. Job design .
4. Behavior modification .
5. Likert’s management system.
6. Monetary incentives .
7. Non – monetary incentives .
1. Managerial Communication
Managers should strive to communicate with other company members, because it’s basic tool
for satisfying the human needs of company members.
2. Theory X – Theory Y
Theory X : involves negative assumption about people .
Theory Y : involves positive assumption about people and must be used by managers.
Production might be increased by using any theory of X or Y assumption. Depending on the
situation the manager face.
3. Job Design
€ Job Rotation
It’s the process of moving workers form between jobs rather than requiring them to perform
only one simple and specialized job over the long term.
Job Enlargement is the process of increasing the number of operations an individual performs
in a job, in order to enhance the individual’s situation in work.
€ Job Enrichment
It’s the process of incorporating motivators into a job situation. And motivating factors are
items that influence the job satisfaction degree (achievement opportunity, recognition
opportunity work itself, responsibility, advancement, personal growth)
€ Flextime
or flexible working hours programs, is a program that allows workers to complete their jobs
within a workweek of normal of hours that they arrange themselves .
4. Behavior Modification
It’s a program that focuses on managing human activity by controlling the
consequences of performing the activity. Positive reinforcement is a reward that
consist of a desirable consequence of behavior, and negative reinforcement is
reward that consist of eliminating of an undesirable consequence of behavior.
5. Likert’s Management System
Includes
¤ - System 1 - this style of management is characterized by a lack of confidence or
trust in subordinates.
¤ - System 2 - this style is characterized by master – to – servant – style confidence
and trust in subordinates.
¤ - System 3 - this style is characterized by substantial, though not complete
confidence in subordinates.
¤ - System 4 - this style is characterized by complete trust and confidence in
subordinates.
styles, systems, and productivity Likert has suggested that as management style
moves from system 1 to 4, the human needs of individuals become more
effectively satisfied over the long-term.
6. Monetary Incentives
It’s a program or plan allows the team members receive a bonus when their team
exceeds a goal. All plans link pay closely to performance (shares of company
stock as a benefit, lump – sum bonuses – one – time cash payment – and gain –
sharing) .
7. Non – Monetary Incentive
This plan makes employees committed and motivated by non-monetary means .
• Considering Groups
A group is any number of people who interact with one another, are
psychologically aware of one another, and perceive to be group.
Why should managers study groups
1. Group exist in all kind of organizations .
2. Groups inevitably from in facets of organizational existence .
3. Groups can cause desirable or undesirable consequences within the organization .
4. An understanding of groups can used in rising probability desirable consequences
in company .
• Groups kinds
Θ Formal Groups
Is group that exists inside organization by management decree to perform tasks that
enhance the attainment of organizational objectives
Θ Informal Groups
Is a collection of individuals whose common work experiences result in the
development of a system of interpersonal relations.
 Controlling
• Definition
Control is the process of monitoring activities to ensure that they are
being accomplished as planned and correcting any significant deviations.
• The Controlling Process
 Measuring performance .
 Comparing measured performance to standards .
 Taking corrective action .
1. Measuring Performance
managers must measure correct organizational performance by establishing some
unit of measure that gauges performance and observe the quantity of this unit as
generated by the items whose performance is being measured.
2. Comparing Measured Performance to Standards
after managers have taken a measure of organizational performance, the next
step in controlling is to compare this measure with some standard.
 A Standard
is a level of activity established to serve as a model for evaluation organizational
performance .
3. Take Corrective Action
after actual performance has been measured and compared with established
performance standards, the next step in controlling process is to take corrective
action if necessary .
Corrective Action focuses on correcting organizational mistakes that are slowing
the organizational performance.
• Control Types
1. Pre-control or Feed forward Control
the control that takes place before work is performed is called per control or feed
forward control . Managers using this type of control to create policies, procedures,
and rules aimed at eliminating behavior that will cause desirable work result .
2. Concurrent Control
Is control that takes place as work is being performed . It relate not only to
employee performance, but also to such non human areas as equipment
performance and department appearance.
3. Feedback Control
is control that takes place after some unit of work has been performed. Control that
concentrates on past organizational performance is called feedback control.
Managers use this type of control to take corrective action by looking at
organizational history over a specified time period . There’s two advantages over
feed forward and concurrent control
first feedback provides managers with meaningful information on how effective
their planning effort was.
second feedback control can enhance employee motivation.

Input Processes Output

Feed forward Concurrent Feedback

Control Control Control
Corrects Corrects
Anticipates
Problems as they Problems after
Problems
Happen they Occur
• Qualities of Effective Control System

1. Accuracy
an accurate control system is reliable and produces valid data.
2. Timeliness
an effective control system must provide timely information .
3. Economy
any system of control has to justify the benefits that it gives in relation to the costs
it incurs .
4. Flexibility
controls must be flexible enough to adjust to problems or to take advantage of
new opportunities .
5. Understandability
controls that cannot be understood have no value. A control system that is difficult
to understand can cause unnecessary mistakes, frustrate employees, and be
ignored .
6. Reasonable Criteria
control standards must be reasonable and attainable if they are too high or
unreasonable, they no longer motivate.
7. Strategic Placement
management can’t control everything that goes on in company . Even if it could the
benefits couldn’t justify the costs . As a result , managers should place controls on
factors that are strategic to the organization’s performance. Control should cover the
critical activities, operations, and events within the organization.
8. Emphasis on the Exception
because managers can’t control all activities, they should place their strategic control
devices where those devices can call attention only to the exceptions .
9. Multiple Criteria
if management controls by using a single measure such as unit profit, effort will be
focused only on looking good on that standard. multiple measures of performance
widen this narrow focus.
10. Corrective Action
an effective control system not only indicates when a significant deviation from
standard occurs but also suggests what action should be taken to correct the
deviation .