PRINCIPLES OF

MANAGEMENT
104

Poonam Shukla

Management
Organization
Two or more people who work together in a structured
way to achieve a specific goal or set of goals.
Goals
Purpose that an organization strives to achieve;
organizations often have more than one goals, goals are
fundamental elements of organization.
The Role of Management
To guide the organizations towards goal
accomplishment

Nature of management

Goal oriented
Continuous process
Coordinative force
Intangible force
Part of group efforts
Dynamic discipline
Pervasive & universal
Accomplishes results through
cooperation of others

Definition:

According to Mary Parker follett :

Management is the art of getting
things done through people.
Management is needed in order to
facilitate a coordinated effort toward
the accomplishment of an
organization's goals.

Management as a
Profession

Term profession may be define as An

occupation backed by specialized body of
knowledge & training and to which entry is
regulated by a representative body.
Essential requirement of a profession :

Specialized field of knowledge.

II. Restricted entry based on education and
training.
III. Representative or professional association.
IV. Ethical code of conduct for self regulation.
V. Social responsibility.
VI. Professional fees.
I.

Profession Vs Management

Specialized body of
knowledge.

Entry based on
education & training.
Professional
Association.

Code of ethics.

Social responsibility.

Management has a
systematized body of
knowledge & principles.
Entry to this field does not
require any prescribed
qualification or training.
There is no professional
association of which
membership is essential for
practicing manager.
Managers are not bound with
any code of conduct some
associations have framed
codes of conduct for
members but they exist on
paper only.
There is a growing concern
for social responsibility of
management

Effectiveness Vs. Efficiency

1.

2.

It refers to
completion of task
on time.
It is concerned
with end results,
i.e., target output.

1.

2.

It refers to the
completion of task
with minimum cost.
It is concerned with
cost-benefit
analysis. i.e., using
less resources and
getting maximum
output

Management: Art or
science?

Management can be an art in the sense that

it has the following characteristics:

Just like other arts it has to be practiced and

performed. The knowledge should be
learned and practiced, just as medical or
legal practitioners practice their respective
sciences.
The manager gainsexperienceby
continuous application of management
knowledge and facing new experiences.
This helps to develop more skills and
abilities for translating knowledge into
practice.

Application calls forinnovativeness and

creativity.

The fourth reason is that in many

situations,theoretical knowledge of
management may not be adequate or
relevantfor solving the problem. It may be
because of complexity or unique nature of the
problem.

The art is in knowing how to accomplish the

desired results. This implies that there exists a
body of knowledge which management uses to
accomplish the desired results in organization

Management as a science has the following

characteristics:

Its principles, generalizations and concepts

aresystematically. In this case the
manager can manage the situation or
organization in a systematic and scientific
manner.

Its principles, generalizations and concepts

are formulated on the basis
ofobservation, research, analysis and
experimentation, as is the case with the
principles of other sciences.

Like other sciences, management

principles are also based on relationship
of cause and effect. It states that same
cause under similar circumstance will
produce same effect. Suppose if workers
are paid more (cause), the produce more
(effect).
Management principles arecodifiedand
systematic, and can be transferred from
one to another and can be taught.
Management principles areuniversally
applicableto all types of organizations.

there is no tailor - made answer to a

question- Is management a science
or art? To ascertain the nature of
management with respect of science
or art, there is a need to know the
exact meaning of the words 'science'
or 'art' and subsequently, their
application to management.

Management Skills
Conceptual Skills : cognitive ability to
see the organization as a whole and
the relationship among its parts
Human Skills : ability to work with
and through other people and to
work effectively as a group member
Technical Skills : understanding of
and proficiency in the performance
of specific tasks.

- People responsible for

directing the efforts aimed
at helping organizations
achieve their goals.
- A person who plans,
organizes, directs and
controls the allocation of
human, material, financial,
and information resources
in pursuit of the
organizations goals.

Management

Management refers to the tasks and activities

involved in directing an organization or one of
its units: planning, organizing, leading, and
controlling.

The process of reaching organizational goals by

working with and through people and other
organizational resources.

 Function: A classification referring to a group

of similar activities in an organization like
marketing or operations.

Functional Managers: A manager responsible

for just one organizational activity such as
accounting, human resources, sales, finance,
marketing, or production
Focus on technical areas of expertise
Use communication, planning and
administration, teamwork and selfmanagement competencies to get work
done

(contd)

General Managers: responsible for the operations

of more complex unitsfor example, a company or
division
Oversee work of functional managers
Responsible for all the activities of the unit
Need to acquire strategic and multicultural
competencies to guide organization

Many Other types of managers

Basic Managerial Functions

Organizing

Leading

Planning

Controlling

Management Process and Goal

Attainment

Management and
Organizational Resources

Planning involves tasks

that must be performed to
attain organizational goals,
outlining how the tasks
must be performed, and
indicating when they
should be performed.

Planning
Determining organizational goals and
means to reach them
Managers plan for three reasons
1. Establish an overall direction for the
organizations future
2. Identify and commit resources to achieving
goals
3. Decide which tasks must be done to reach
those goals

Organizing means assigning the planned tasks to

various individuals or groups within the
organization and cresting a mechanism to put plans
into action.

Organizing

Process of deciding where decisions will be made, who

will perform what jobs and tasks, and who will report
to whom in the company
Includes creating departments and job descriptions

Leading (Influencing) means guiding the activities

of the organization members in appropriate
directions. Objective is to improve productivity.

Leading
Getting others to perform the
necessary tasks by motivating them to
achieve the organizations goals
Crucial element in all functions
Discussed throughout the book and in
depth in Chapter 15Dynamics of
Leadership

1. Gather information that measures recent performance

2. Compare present performance to pre-established standards
3. Determine modifications to meet pre-established standards

Controlling
Process by which a person, group,
or
organization consciously monitors
performance and takes corrective
action

Basic Levels of Management

Top
Top
Managers
Managers
MiddleManagers
Managers
Middle
First-LineManagers
Managers
First-Line
Nonmanagers
Nonmanagers

Top Level / Top Managers

Responsible for providing the overall direction of an
organization
Develop goals and strategies for entire organization
Spend most of their time planning and leading
Communicate with key stakeholdersstockholders,
unions, governmental agencies, etc., company
policies
Use of multicultural and strategic action
competencies to lead firm is crucial

Laying down broad objectives and policies of the

organization.

Taking decision for the accomplishment of the goals of the

enterprise.

Coordination of various departments and divisions.

Laying down guidelines for the departmental and
divisional plans.
Making appointments to middle level positions in
the company organization, such as Divisional
Manager, Secretary, Departmental Heads, etc.
Reviewing the work of executives at different levels
to ensure that their performance is in accordance
with the objectives laid down.

Levels of Management

First-line Managers: have direct responsibility for

producing goods or services Foreman, supervisors,
clerical supervisors

Middle Managers:
Coordinate employee activities
Determine which goods or services to provide
Decide how to market goods or services to customers
Assistant Manager, Manager (Section Head)
Top Managers: provide the overall direction of an
organization Chief Executive Officer, President, Vice
President

First-line Managers
Directly responsible for production of goods or services
Employees who report to first-line managers do the
organizations work
Spend little time with top managers in large organizations
Technical expertise is important
Rely on planning and administration, self-management,
teamwork, and communication competencies to get work
done

Middle Managers
Responsible for setting objectives that are consistent with
top managements goals and translating them into specific
goals and plans for first-line managers to implement
Responsible for coordinating activities of first-line
managers
Establish target dates for products/services to be delivered
Need to coordinate with others for resources
Ability to develop others is important
Rely on communication, teamwork, and planning and
administration competencies to achieve goals

Management Level and Skills

Introductory Concepts: What Are

Managerial Competencies?

Competency a combination of knowledge,

skills, behaviors, and attitudes that contribute to
personal effectiveness
Managerial Competencies sets of knowledge,
skill, behaviors, and attitudes that a person
needs to be effective in a wide range of positions
and various types of organizations

Six Core Managerial Competencies:

What It Takes to Be a Great Manager
Communication Competency
Planning and Administration Competency
Teamwork Competency
Strategic Action Competency
Multicultural Competency
Self-Management Competency

Communication Competency
Ability to effectively transfer and exchange information
that leads to understanding between yourself and others
Informal Communication
Used to build social networks and good
interpersonal relations

Formal Communication
Used to announce major events/decisions/
activities and keep individuals up to date
Negotiation
Used to settle disputes, obtain resources,
and exercise influence

 Deciding what tasks need to be done, determining

how they can be done, allocating resources to enable
them to be done, and then monitoring progress to
ensure that they are done
Information gathering, analysis, and problem solving
from employees and customers
Planning and organizing projects with agreed
upon completion dates
Time management
Budgeting and financial management

 Accomplishing tasks through small groups of

people who are collectively responsible and
whose job requires coordination
Designing teams properly involves
people participate in setting goals

having

Creating a supportive team environment gets

people committed to the teams goals
Managing team dynamics involves settling
conflicts, sharing team success, and assign tasks
that use team members strengths

Strategic Action Competency

Understanding the overall mission and values of
the organization and ensuring that employees
actions match with them
Understanding how departments or divisions of
the organization are interrelated
Taking key strategic actions to position the firm
for success, especially in relation to concern of
stakeholders
Leapfrogging competitors

Snapshot
Sony must sell off businesses that dont fit
its core strategy of fusing gadgets with films,
music, and game software. That means
selling off its businesses in its Sony Financial
Holdings, which are very profitable.

Howard Stringer, CEO, Sony

Multicultural Competency
Understanding, appreciating and responding to
diverse political, cultural, and economic issues
across and within nations
Cultural knowledge and understanding of the
events in at least a few other cultures
Cultural openness and sensitivity to how others
think, act, and feel
Respectful of social etiquette variations
Accepting of language differences

Self-Management Competency
Developing yourself and taking responsibility
Integrity and ethical conduct
Personal drive and resilience
Balancing work and life issues
Self-awareness and personal development
activities

Self-Management Competency
Snapshot
My strengths and weaknesses havent
changed a lot in 51 years. The important
thing is to recognize the things you dont do
well and build a team that reflects what you
know the company needs.

EVOLUTION OF MANAGEMENT
THOUGHTS

CLASSICAL APPROACH

i.
ii.
iii.

0ne of the oldest approach to management which

is also known as mgmt process app, functional
app & administrative mgmt app.
It concentrates on organization structure & their
management.
The classical writer include Taylor, Fayol, Weber,
Gullick, Urwick, Mooney and Reiley and others.
This theory incorporates three viewpoints:
Taylors Scientific management.
Fayol Administrative theory.
Webers Bureaucracy.

These writers concentrated on structure and that

is why their approach sometimes is characterized
as structural framework of organization.
Taylor insisted on application of scientific
methods to the problems of management.
Fayol suggested fourteen principles of
management & their universal application.
Weber introduced rational structure called
bureaucracy. It is characterized by division of
labour, specialization, rationality, personnel
competency, etc.

Contributions of Classical Approach

Main Features
1.

2.

3.

4.

It concentrated on the study of formal organizations.

it laid emphasis on division of labour, specialization,
structure, scalar chain, functional processes & span
of control.
Management is the study of managerial experiences.
If the experiences are studied and certain
generalizations are derived therefrom, these will
help the practicing managers.
They concentrates on organization structure for
coordination of various activities. they ignored the
role of human element.
Relationship b/w workers & management is
established through formal communications, defined
tasks and accountability and formalized procedures &
practices to minimize conflict b/w them

5.

6.

7.

8.

9.

The worker is essentially an economic man who can

be motivated basically by economic rewards. Money
is considered the main motivator under this theory.
The efficiency of the organization can be increased by
making each individual efficient.
The integration of the organization is achieved
through the authority and control of the central
mechanism. Thus, it is based on centralization of
authority.
There is no conflict b/w the individuals and the
organization. In case of any conflict, the interests of
the organization should be prevailed.
It is based on study of past experiences ans cases of
various organizations. It implies that formal education
and training is required for developing managers.

Criticism of Classical Approach

This approach ignored the human relations aspect and

undermined the role of human factor. Its main emphasis
was on formal structure, centralization of authority,
unity of command and narrow span of control.
It viewed organization as a closed system, i.e., having
no interaction with the external environment.
Economic reward were assumed as the main motivator
of workforce. The role non-monetary factors was
ignored.
The classical principles are based on managerial
experiences and their limited observation.
Based on over simplified assumptions. Its principles are
ambiguous and contradictory.
Emphasized on strict adherence to rules and
regulations. The scope for individual initiative is thus
limited.

NEO-CLASSICAL/HUMAN RELATION APPROACH

The neo-classical/human relations approach was proposed

as a reaction to the classical approach which ignored
human relations.
Neo-classicists focused on the human aspect to industry.
They modify the classical theory by emphasizing the fact
that organization is a social system and the human factor is
the most important element within it.
They conducted some experiments (known as Hawthorne
experiments) & investigated informal groups, informal
relations, pattern of communication, pattern of informal
leadership, etc. this lead to development of HR App.
Elton Mayo is generally recognized as the father of the HR
school. Other contributors to this school include
Roethlisberger, Dickson, Dewey, Lewin etc.

Contributions of H R App/Neo-Classical App

Social System
Social environment
Informal organization
Group Dynamics
Leadership
Communication
Role of money
Conflict

Criticism of neo-classical approach

Invalid assumption
Lack of scientific validation
Limited application
Limited focus on work
Over concerned with happiness
Fragmented approach

Hawthorne experiments

Between 1972-1932, some significant

experiments in the field of industrial
psychology were carried out by George
Elton Mayo and F.J. Roethlisberger,
professor of Industrial research at the
Harvard Graduate School of Business
Administration, and William J. Dickson
of Western Electric Company.

1.Illumination Experiment

The purpose of this experiment was to assess the

effect of illumination on employee output.
Two groups were selected from among the
employees.
One group was placed in the room where lighting
remained constant.
The other group was placed in another room where
lighting varied periodically.
Surprisingly, the output of both the groups increased
steadily.
It was concluded that lighting was the minor factor &
there were other more important factors influencing
the output.
At this stage, Mayo & his team was invited to conduct
further studies.

2. Relay Assembly Test Room

Experiment

The test group consisted of six female workers.

Frequent changes were made in their working
conditions such as shorter working hours, rest
periods, hot lunch, friendly and informal
supervisors, free interaction among members of
the group, etc.
Productivity of the group increased even when
the improvements in working conditions were
withdrawn.
It was concluded that socio-psychological factors,
e.g., special attention, recognition and sense of
group belonging exercise a greater influence on
productivity than working conditions.

3.Bank Wiring Observation Room Study

In this experiment, a group of fourteen workers

was put under close observation.
The pay of every member was made dependent
on the performance of the group as a whole.
It was found that the group had developed its
own norms of performance and various forms of
social pressure were exercised to enforce these
norms.
as a result output could not increase despite
group incentive scheme

4.Mass Interview programme

A large number of workers were interviewed by

the researchers to understand their attitudes and
opinions on the factors influencing productivity.

It was found that the opportunity to talk freely

about things that are important to workers, has a
positive effect on their morale and productivity.

Major findings of the Hawthorne

experiments or Human Relations studies are
as under:

An organization is a psycho-social system.

Human factor is the most important element in
the social system.
Behavior of an individual is dominated by the
informed group of which he is a member.
Workers are not merely rational economic beings
motivated simply by money. The are also sociopsychological beings and respond to the total
work situation.
Socio & psychological factors exercise a greater
influence on employee behavior and performance
than physical conditions of work.

Workers act or react not as individuals but

as members of a group. The informal
groups have their own norms and belief.
These groups and their leader exercise
an overriding influence on the attitude ,
behaviour and performance of individual
employee.

Workers respond to the total work

situation. Their behaviour and
performance are conditioned by factors
inside and outside the work-place.

14-principles of
management

Functional Management Approach

-Henri Fayol
Henri Fayol is said to be the father of Management
process or Administrative Management school.
His contribution to the Classical theory tremendous.
Fayol was born in 1841 & got a degree in mining
engineering in 1860.
He joined as a Junior Executive in French Mining
Company in 1860 & rose to the position of its Chief
Executives in 1888.
He had sufficient opportunity to search for sound
management opportunities & was able to analyse
the management process which he laid down in his
famous work General & Industrial Administration
published in French in 1916.this work was later
translated in english in 1949.

According to Fayol, all activities of industrial

undertakings could be divided into six groups:
I.

II.
III.

IV.
V.

VI.

Technical (Production, manufacturing ,

adaptation);
Commercial (Buying, selling & exchange);
Financial (Search for, & optimum use of ,
capital);
Security (Protection of property & person);
Accounting (including balance sheet, costs &
statistics); &
Managerial (Planning, organizing, command,
coordination & control).

1.
2.

3.
4.

5.

Managerial functions: Fayol analyzed the

managerial job in terms of series of functions
which are performed by managers in all types of
organizations at all levels.
Fayol said, To manage is to forecast and plan, to
organize, to command, to coordinate and to
control. Thus , the functions or elements which
constitute the management process are:
Planning (to foresee and provide means for the future).
Organising (to provide a business everything useful to its
functioning-raw materials, tools, capital and personnel).
Commanding (maintaining activity among personnel).
Co-ordinating (unifying & harmonizing all activities &
efforts).
Controlling (seeing that everything occurs in conformity
with established rule and expressed command).

14 principles
1.

2.

3.

4.

Division of work : the work of every person in the

organization should be limited as far as possible to the
performance of a single leading function. This helps to do
more and better work with the same efforts.
Authority and responsibility: Responsibility is a natural
consequence of and a corollary to authority. The two are
coextensive and, therefore, a parity should be maintained
between them. Authority is not to be conceived of apart from
responsibility. Wherever authority is exercised responsibility
arises.
Discipline: it implies respect for rules and agreements
designed to secure obedience. It must prevail throughout an
organization to ensure its smooth functioning. Discipline
requires clear and fair agreements, good supervision and
judicious application of penalties.
Unity of command: every employee must receive orders
and be accountable to only one boss. It is necessary to avoid
conflicting orders and to ensure order and stability in the
organization.

5.

6.

7.

Unity of direction: there should be one head and one plan

for a group of activities having same objective. This is
essential to ensure unity and coordination in the enterprise.
Unity of command can not exist without unity of direction.
Unity of command is concerned with grouping of persons
whereas unity of direction relates to grouping of activities.
Subordination of individual to general interest: efforts
should be made to reconcile individual interest with
common interests. When there is a conflict between two.
The interests of the organization should be prevail over
individual interests. This require continuous and exemplary
supervision and fair agreements.
Remuneration of personnel: the amount of remuneration
& the methods of payment should provide maximum
possible satisfaction to both the employees & employers.

8.

9.

10.

11.

Centralisation: concentration of authority in a single

person is called centralisation. Everything which decreases
the importance of subordinates is centralisation &
everything which increases their importance goes to reduce
centralization. But the aim should be to utilize maximum
faculties of the personnel employed in the organization.
Scalar chain or Hierarchy: it is the chain of superiors or
the line of authority from the highest executive to the
lowest level employees for purpose of communication.
Fayol suggested that when following the scalar chain
strictly creates hurdles in communication. Flexibility in
communication should be allowed to the subordinates.
Order: Acc. To Fayol, there are two aspects to ordermaterial & social. A place for everything & everything in its
place means material order and a place for everyone &
everyone in his place means social order.
Equity: It means fairness, kindliness and justice for all. This
requires that management must have the desire to equity
in its dealing with people.

12.

13.

14.

Stability of tenure of personnel: this is essential to get

an employee accustomed to work and gain proficiency in
doing it. This could be achieved by providing attractive
remuneration & honorable treatment to employees.
Stability and continuity of personnel would promote
teamwork, loyalty and economy and minimize employees
turnover.
Initiative: eagerness to initiate actions in work related
matters without being asked to do so. An organization
should encourage desire and initiative among its
managers & employees by extending opportunities and
freedom to contribute their best.
Esprit de corps: it refers to team spirit. Managers must
take steps to develop a sense of belonging among the
members of a work group. This principle emphasizes the
need of teamwork.

Scientific Management
F.W.Taylor

Taylor was the first management thinker who insisted on the

introduction of scientific methods in management & it was he
who, along with his associated, made the first systematic
study of management. He launched a new movement in 1910
which is known as Scientific management. This is why, taylor
is regarded as the father of scientific management.
Scientific management: Acc. To F.W. Taylor, Scientific
Management is the substitution of exact scientific
investigations and knowledge for the old individual judgment
or opinion in all matters relating to the work done in the
shop. --- It implies the application of science to
management of a business concern. It aims at replacement of
traditional techniques by scientific technique.
SM is the process of directing human efforts which employs
scientific methods for getting highest productivity.
SM is a throughtful, organised human approach to the job of
management as contrasted with hit or miss, rule of thumb. it
is the art of knowing exactly what you want men to do and
than seeing that how they do it in the best and cheapest
way.

Scientific management includes: Finding the most efficient methods of

production, Scientific selection and training of workers, Proper allotment of
duties and work and achieving cooperation between workers and
management.

In short, SM involves:

1.
2.
3.

1.

2.

3.

4.

5.

6.

Scientific study and analysis of work;

Scientific selection & training of employees;
Standardization of raw materials, working conditions and equipment.

Aims of scientific management:

Quality Control-improvement in the quality of the output of
research, quality control & inspection devices.
Cost Reduction- reduction in the cost of a production by
rational planning & regulation, & cost control technique.
Increased Production- increase in the rate of production by use
of standardized tools, equipment & methods.
Elimination of wastes-in the use of resources & methods of
production.
Right men for right work- placement of right person on the
right job through scientific selection & training.
Incentive Wages- payment of wages to workers according to
their efficiency.

Techniques of SM
1.

Scientific task setting:

workers restricted their output because of the major reason

that there was no standard about a proper days work.
therefore, it is essential to set the standard task which an
average worker should do during a day.
He termed it a fair days work. the standard task is to be set
by the management scientifically so that it represents the
amount of work which an average worker, working under
average standardized conditions in an atmosphere of mutual
trust and cooperation, will be able to do during a day.
It will act as a norms for the workers and will prevent them
from doing work much below their capacity.
It should be kept in mind that the standard task is neither too
low nor too high.& the average worker should be capable of
doing the standard task.
For the setting of standard task, scientific techniques should
be used.

2.

Work study: It implies an organised, objective, analytical &

critical assessment of the efficiency of various operations in an

enterprise.

Work study includes the following techniques:

(a) method study: this is conducted to know the best method of

doing a particular job. It helps in reducing the distance travelled

by material & brings improvement in handling, transporting,
inspection and storing of raw materials and goods.

(b)

motion study: it is the study of the movement of an operator

or machine. Its purpose is to eliminate useless motions &

finding out the best method of doing a particular job. By
undertaking motion study, an attempt is made to know whether
some elements of a job can be eliminated, combined or their
sequence changed to achieve the necessary rhythm.
(c)

time study or work measurement: it is an art of

observing & recording the time required to do each detailed

element of an industrial operation. through time study the
precise time required for each element of a mans work is
determine. It helps in fixing the standard time required to do a
particular job.

(d) fatigue study: fatigue, physical or mental, has an

adverse effect on workers health and his efficiency.
Fatigue study helps in reducing fatigue among the
workers. Fatigue is generally caused by long working
hours without rest pauses, repetitive operations, excessive
specialization & poor working conditions. The purpose of
fatigue study is to maintain the operational efficiency of
the workers.

3.

Planning the task: He emphasized the need for

planning work. He advocated that planning function should

separated from the executive function. Workers should not
be supposed to choose their own methods & decide what
they have to do. The detailed planning should be done by
the planning department. the planning department should:
a.

b.
c.

d.

e.

Prepare detailed instructions for the workers as to the type,

shape, quality & quantity of the products to be produced.
Lay down the machines & equipment to be used.
Determine the time required for completion of various
operations,
Make available the necessary materials & tools in carrying
out the operations. and
receive feedback information for the modification of
planning, if necessary.

4.

Setting if wage rate: wage rate should be fixed in such a

way that the average worker in induced to attain the standard.

Taylor suggested the differential piece-wage system. Under this
system, higher rates are offered to those workers who produce
more than the standard quantity. Taylor was of the view the
efficient workers should be paid from 30% to 100% more than
the average workers.
5.

Standardization of tools & equipments: He advocated

the standardization of materials, tools & equipment, cost

system & several other items. Efforts should also be made to
provide standardized working conditions & methods of
production to the workers. There are many advantages of
standardization:
First- operators can be trained easily.
Second- it is economical to have standardized material, tools &
equipments etc.
Third-it helps in achieving various economics of large scale
production.
Fourth- it will improve the quality of production and reduce the
cost of repairs & maintenance.

6.

Scientific selection & training of workers: selection

procedure must be designed carefully because errors

committed at the time of selection may prove to be very
costly later on. If the selection process is faulty, there will not
be right workers on the right jobs. Thus the efficiency of the
organization will be reduced. Only a worker who meets the
requirements of his job can do it well & at the minimum cost.

7.

Training of workers is the other task of management after the

appropriate placement of workers is the other task of
management . Training helps in changing the behaviour of the
workers. It can be of great help in teaching them the best
method of doing their job.

Specialization of function foremanship: he advocated

that specialization must be introduced in a factory. He
advocated functional foremanship for this purpose. He
recommended eight foremen in all to control the various
aspects of production. He advocated four foremen in the
planning department & four foremen for getting the required
performance from the workers .

Functional foremanship

1.Route Clerk

1.Gang Boss

2.Instruction
Card Clerk

2. Speed Boss

3.Time & cost

Clerk

3. Repair Boss

4.Shop
Disciplinarian

4. Inspector

SPECIALIST OF PLANNING DEPARTMENT

Route Clerk: this clerk ensures the sequence of completing a

particular work, meaning thereby the stages it shall have to
pass before being finalized. He also decides the job to be
done for the day and where it is to be done.

Instruction Card Clerk: this clerk prepares the instruction

cards for the workers & hands them over to the gang boss.
These cards contain information about the nature of the
work, procedure of doing it, material to be used & the details
about machinery.

Time Cost Clerk: this clerk decides as to when a particular

work is to be started and finished, it means what time the
whole work will take place. It is also decided at the same
time at what cost the product will be produced.

Discipline Officer: he ensures that every work is being

performed in a disciplined manner.

SPECIALISTS OF PRODUCTION DEPARTMENT

Gang Boss: The workers are divided into various groups from
the point of view of control. A group leader is selected who is
known as gang boss. He is expected to ensure that both the
workers and the machines are fit enough for production & that
the material required for their use has been made available to
them.

Speed Boss: his function is to ensure that all the workers are
performing their job at the required or expected speed. If it is
not so, the speed boss tries to find out the cause of slow speed
& hence a solution for it.

Repair Boss: his function is to keep the machine & tools in

working condition.

Inspector: he inspects the things produced & compares their

quality with the standard prescribed for them & tries to find out
the difference. In case of unfavorable result he initiates
corrective action.

Principles of scientific management

1. Replacement of old rule of thumb

method.
2. Scientific selection & training of
workers.
3. Cooperation between labour &
management.
4. Equal division of responsibility.
5. Maximum output.

Benefits of scientific management

To employers:

1.Replacement of old rule of thumb method by scientific

investigation.
2.Proper selection and training of workers leading to better
workforce.
3.Establishment of harmonious relationships between the workers
& the management.
4.Achievement of equal division of responsibilities between the
workers & the management.
5.Standardisation of tools, equipment, materials & work methods
for increasing efficiency.
6.Better utilisation of various resources and elimination of wastes.
7. Scientific determination of work a worker can do during the
day. This leads to good relations between the employers & the
workers.

Cont.

To workers:

1.

Detailed instructions and constant guidance for

the workers.
Opportunity for training & development to
increase skills.
Incentive wages to the workers for higher
production.
Better working conditions & tools of work for good
health of the workers.
Less fatigue in work because of application of
scientific methods.

2.

3.

4.

5.

Cont.

To Society:

1.Better quality products at lower costs to the

people.
2.Higher standard of living of people through better
products.
3.Increaded productivity in the country.
4.Industrial peace in the country.
5.Technological development due to scientific
investigation.

Criticism of scientific management

Speeding up of workers.
Boredom.
No scope for initiative.
Unemployment.
Exploitation of workers.
Weakening of trade unions.

BUREAUCRATIC THEORY
MAX WEBER

A German sociologist, this type of

organization is based on the legitimate and
formal system of authority.
Weber offered this model as a framework to
which all organizations should aspire. the
one best way of doing things.
He outlined the characteristics of the
ideal bureaucracy from functional point of
view. Some of these characteristics of are
structural & others behavioural.
He used the word bureaucracy not to
refer disparagingly to rules by officials, but
to designate a specific kind of
administrative organization.

Weber identified three types of power or domination

in organizations

Charismatic power or domination: It occurs when a leader can

command followers because of exceptional performance & the
followers have faith in him. Example might be the leadership
of Mahatma Gandhi.
Traditional power or domination: it occurs when the leader
commands because of inherited position. The follower believe
that this is the leaders inherited right because affairs have
always been conducted this way. The followers are
administered by the officials who are appointed by the leader.
Example might be found in feudal societies with kings and
serfs.
Rational-legal power or domination: it occurs when the leader
has obtained a position through a legal procedure that the
followers consider right or correct . Followers obey because
they accept the law & procedures. The administrative method
in this case is bureaucracy. Example might be military officers
or the corporate president whose orders are obeyed by the
subordinates without asking any question.

Definition of Bureaucracy
The term bureaucracy is used to represent :
1. State administration (govt. organization),
2. A group of officials in an organization who run administration
on contract employment basis, and
3. Rational organization which is in accordance with webers
type of structure.
But now the term is applied to all most all big organizations.
Acc. To talcott parsons, bureaucracy is equivalent to relatively
large scale organizations with special functions. Taken in this
sense, bureaucracy refers to a distinct type of structures
based on division of work, hierarchy of positions, rules &
regulations, officials records, etc.
Acc. To McFarland, Bureaucracy is a system of organization
and management in which roles, tasks, and relationships
among people & positions are clearly defined, carefully
prescribed, and controlled in accordance with formal
authority.

Characteristics of bureaucracy
1. Division Of Work: a systematic division of organizational
functions, rights & powers. Every member is specialized in a
particular function & knows the limits of his job. Each official
is responsible for a specific function & is given matching
authority to carry out his responsibility.
2. Impersonal Conduct: there are impersonal relationship among
the organizational members. Decisions are entirely guided by
rules & regulations & are totally impersonal. There is no room
for emotions & sentiments in this type of structure.
3. Hierarchy Of Positions: a clearly defined hierarchy is created
through delegation of authority. Every official is part of this
hierarchy. Each official exercises supervision & control on his
subordinates with provisions for appeal to higher authorities.
All activities follow the principle of hierarchy. Each position in
the hierarchy has complete jurisdiction on a particular
function in terms of both authority & competence. Thus,
compliance with rules & co-ordination of activities is
systematically ensured. The hierarchy of authority also serves
as a line of communication & delegation of authority .

Cont.
4. Rules & Regulations: Detailed & rigorous rules & regulations
are laid down to specify & govern the work behaviour, rights &
duties of job-holders in the organization. There is rigid
adherence to prescribed rules designed to ensure consistency
& predictability in work performance. Behaviour is subject to
discipline & control within the framework of rules.
5. Staffing or Administrative Machinery : they have specialized
admin staff who are responsible for the smooth running of the
organization. The features of the staffing patterns are as
under:
1.The personnel are employed by a contractual relationship b/w
the employee & employer. The tenure of service is governed
by the rules & regulations of the organization.
2. Personnel's are whole time employees. The officials receive the
regular pecuniary compensation or a normally fixed salary &
other financial benefits. The compensation, known as salary, is
not measured in terms of work done. But according to the
status, that is, according to the rank or position held and, in
addition, possibly acc. to length of service.

Cont.
3. Employee do not have any significant proprietary interest in the
property of the organization. They have interest in the organization to
the extent of their careers. There may be some who may have their
personal interest but such interest is not the basis of their entrance in
official positions.
4.The bureaucrats are neither elected nor inherited, but they are
appointed through a scientific selection procedure & the basis of
selection is their technical competence. As such they do not have
possession right in managerial positions.
6.Technical Competency: Employment & promotion in bureaucracies are
based on technical competence and performance. These criteria are
the real basis for legitimization of authority. Following them ensures
that the best qualified people will pursue a career in the organization
& remain loyal to it.
7.Official Records: Administration of such organization is supported by an
efficient system of record keeping. Decisions & activities of the
organization are formally recorded & preserved safely for future
reference. This is made possible by extensive filling system.

Functions or benefits of bureaucracy

Specialization
Well defined structure of relationship
Uniformity of action
Rationality of behaviour
Predictability of behaviour
Efficiency

Limitations of bureaucracy structure

Delay & red tapism

Rigidity
Goal displacement
Lack of human touch
Compartmentalization of activities
Empire building
Excessive paperwork

Systems approach (1950s)

1.
2.

3.
4.

5.

System approach is based on the generalization that an

organization is a system and its components are inter-related &
inter-dependent.
A system is composed of related & dependent elements which,
when in interaction, form a unitary whole. It is simply an
assemblage or combination of things or parts, forming a complex
whole. Thus each system may comprise several sub-systems & , in
turn, each system may be further composed of sub systems.
An organization as a system has the following characteristics:
A system is goal oriented.
It consist of several sub systems which are interdependent & inter
related.
It is engaged in processing or transformation of inputs into outputs.
An organization is an open and dynamic system. It has continues
interface with the external environment as it gets inputs from the
environment & also supplies its output to the environment. It is
sensitive to its environment such as govt policies, competition in
the market, technological advancement, tastes of people, etc.
A system has a boundary which separates it from other systems.

Features of systems approach/modern management

theory
1.

2.

3.

Open system view of organization: this theory consider

organization as an open system which has continuous
interaction with the environment. It gets various resources
from the environment & transform them into outputs desired
by the environment.
Adaptive system: which can continuously adjust to
changing environment. Management tends to bring changes
in the sub-systems of the organization to cope up with the
challenges of environmental forces. Since, there is a
provision of feedback mechanism, management can evaluate
its performance & take corrective actions. The basic role of
management is considered in terms of its adaptability to
environment.
Interdependent sub-system: e.g; in a business enterprise,
production, sales & other departments are sub-systems. All
these sub-systems are functionally interacting &
interdependent. They are tied together into an organic whole
through goals, authority flows, resources flows and so on.

cont.
4.Whole organization: it provides a unified focus to
organizational efforts. It gives managers a way of looking at
the organization as a whole that is greater than the sum of
its parts. The stress is laid on integration of various subsystems of the organization to ensure overall effectiveness of
the system.
5. synergy: the output of a system is always more than the
combined output of its parts. This is called the law of synergy.
The parts of a system become more productive when they
interact with each other than when they act in isolation.
6. Multi level analysis: the modern approach has both macro &
micro aspects. At the macro level, it can be applied to the
whole industry or the national economic system. At a micro
level, it can be applied to an organization and even to a sub
system of the organization.

Cont.

7. Multi-variate analysis: The system approach takes into

account many variables simultaneously. This suggests that
there is no simple cause and effect phenomenon, rather an
event may be the result of so many variables which
themselves are interrelated and interdependent. This
interrelatedness and interdependence makes managing
quite a complex process. Thus, systems approach
emphasizes the complexity of modern organizations.
8. Multi-disciplinary: Modern theory of management is
enriched by contributions from various disciplines like
psychology, sociology, economics, mathematics, operations
research & so on.

limitations of systems approach

1.

2.

3.

4.

Lack of unification: this approach can not be considered a

unified theory of organization. A unified theory is one which
can be applied to all types of organizations, & present their
comprehensive analysis so that various people who want to
study organisations from different angles can derive
knowledge. That is what systems approach was expected
to do but, the systems app fails to do that.
Abstract analysis: the systems theory is too abstract to be
of much use to the practising managers. It indicates that
various parts of the organization are interrelated & his
interrelationship is dynamic. But is has failed to spell out
the precise relationship between various sub-systems.
Limited view of organization-environment interface: the
systems approach has failed to specify the nature of
interactions & interdependencies between an organization
& its external environment.
Limited Application: it does not provide action framework
applicable to all types of organizations.

Contingency approach

A review of earlier approaches to organization helps us to

place the current approach to management in perspective.
The performance result of the classical schools universalist
assumptions were generally disapproving.
The neo classical/ HR approach was also incomplete.
Many authors believe that a systems based theory could
solve this dilemma. But this approach is also incomplete.
The latest approach that integrates the various approaches
to management is known as contingency , situational or
common sense approach. This approach is not new.
Pigors & myers propagated this approach in the area of
personal management as early as 1950. However, the work
of Joan Woodward in the 1950s marked the beginning of the
contingency approach to organization.
Other contribution include Tom Burns, G. W. Stalker, Paul
Lawrence, Jay Lorsch, & James Thompson.

Cont.

They analysed the relationship b/w the structure of the

organization & the environment. Thus, contingency approach
incorporates external environment & attempts to bridge the
theory- practice gap.
It does so in the systems framework.
Contingency app also regards organization as an open &
dynamic system which has continuous interaction with the
environment.
Basic theme of contingency approach:
Acc. To Kast & roseazweig, the contingency view seeks to
understand the inter-relationships within and among subsystems as well as between the organization & its environment
& to define patterns of relationships of variables. Contingency
view are ultimately directed toward suggesting organizational
designs & managerial actions most appropriate for specific
situation.
This approach emphasises the multivariate nature of
organizations & attempts to understand how organizations
operate under varying conditions & in specific circumstance.

Contingency views are ultimately directed toward

suggesting organizational designs & managerial actions
most appropriate for specific situations.
An underlying assumption of the contingency view is this
there should be a congruence b/w the organization &
environment & among the various sub-systems.
The primary managerial role is to maximise the
congruence.
The appropriate fit b/w the organization & its environment
& the appropriate internal organizational design will lead to
greater effectiveness, efficiency & participants satisfaction.

Kast & Rosenzweig have analysed the appropriateness of two kinds of structures
under different circumstances.
Firstly, the stable mechanistic structure is more appropriate when the following
conditions are fulfilled:
1.The environment is relatively stable & certain.
2.Goals of the organization are well defined & enduring.
3.Technology is relatively uniform & stable.
4.There are routine activities & productivity is the major objective.
5.decision-making is programmable & coordination & control processes tends to
make a tightly structured, hierarchical system possible.
Secondly, the adaptive-organic structure is more appropriate when the following
conditions are fulfilled:
1.Environment is relatively uncertain & turbulent.
2.Goals are diverse & changing.
3.Technology is complex & dynamic.
4.There are many non-routine activities in which creativity & innovation are
important.
5.The system is less hierarchical & more flexible.

Contribution of contingency approach

1.

2.

3.

Contingency approach is an extension of the system approach.

Basic theme of this approach is that organization have to cope
with different situations in different ways.
There is no single best way of managing applicable to all
situations.
In order to be effective, the internal functioning of an
organization must be consistent with the demands of the external
environment.
The manager must keep the functioning of an organization in
harmony with the needs of its members & the external forces.
The utility of contingency app. Will be clear from the following
points:
This app. Advocates that there is no single best way of managing
applicable in all situations.
It rejects universality of management concept and it appeals to
common sense.
Management should match or fit its approaches to the
requirements of the particular situations. To be effective,
management policies & practices must respond to environmental
changes

Cont.

Its an action oriented approach as it is directed towards the

application of systems concepts and the knowledge gained
from other approaches. However, the choice of a particular
strategy would depend upon the type of situation faced.