mbp-mod-1.doc
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MANAGEMENT
INTRODUCTION TO MANAGEMENT
Organisations are required to accomplish, a given task according to schedule and pre-
determined programme. The people are made to work. They don’t themselves work.
Management therefore has come to stay as an activity process in this complex industrial and
commercial world. It is composed of some basic functions for getting the objectives of a business
house achieved through sustained and well directed efforts of its personnel.
DEFINITION OF MANAGEMENT
It is very difficult to give the precise meaning of the term ‘Management’. The concept of
management is as old as the human race itself. Management is not only an essential element of
organised society, but also an integral part of life. But what is Management? How do we define
it? How do we differentiate between good management and bad management? In the
management literature, we find large number of definitions of management given by different
authors.
1) According to E.F.L. Breech – “Management can be defined as a social process entailing
responsibility for the effective and efficient planning and regulation of the operations of an
enterprise,’’ such responsibility involving
(a) The installation and maintenance of proper procedures to ensure adherence to plans,
and
(b) Guidance integration and supervision of the personnel comprising the enterprise and
carrying out its operation.”
2) According to Henry Fayol “Management is to forecast and plan, to organise, to command, to
co-ordinate and to control.” It attempts to describe management in terms of what a manager
does and not what management is?
3) According to Keith and Gubbline “management is the force that integrates men and physical
plant into an effective operating unit.”
4) According to Oliver Sheldon, “the term management is commonly used to cover the formation
of policy, its execution, the designing of the organisation and its employment.”
5) According to Kimball and Kimball “management may be defined as the art of applying the
economic principles that underline the control of men and materials in enterprise under
consideration.
NATURE OF MANAGEMENT
The concept of management is very old. Therefore, different views have been expressed
about its nature by different authorities. The main view points about the nature of management
are as follows,
1. Management as an inborn quality
Prior to 1880 there has been a leading concept that management is an inborn quality. People
believed that it was not necessary to study any organised body of management concepts as
managers are born not made some people are so efficient and talented since their birth that they
lead and get success in the field of business. But this concept has been deleted by the new
developments.
2. Management is social science
In describing the nature of management eminent authors of management are of this opinion
that it is a social science. It is supposed to be the behavioural science in exact nature. Its
principles and are situation bound. Despite the fact that a large no of theories and principles of
management have been established, there applicability may not necessarily lead to same result.
The process of management is very much related with the behaviour people at work and their
behaviour cannot be predicted in an exact manner. So the limitations of social science are there
with science of management. But with the introduction of quantitative tools in the field of
decision making. Management is growing as a science. It has an organised body of knowledge
having its other nature. So it can be said that management is a social science having its own
approach and dynamics in different work situations.
3. Management in nature is the work done through and with people
It is concerned with the exercise of the knowhow for the effective accomplishment of desired
results. As the process of managing is a fine art, it is with application of the principles keeping in
view the real life situations. The same process is followed in repetitive manner and the practise is
moulded according to the experience after applying the set body of knowledge. Management is
also creative in nature.
4. Management in “as a profession in nature
It satisfies all the conditions of a profession. It has a well defined body of knowledge. It requires
formal training and it is been provided to new entrance. It has various representative bodies and
the entrants are joining in it as a career with the aim of serving the society not for making alone.
5. Management is an Art
Management is not only concerned with scientific theories and practices but also with the
application of skills and knowledge to get the work done. Without being creative enough, every
activity in the management process goes waste.
6. Management is dynamic
The principles of management are so flexible that it can be adoptable to any kind of business
situation. They are universally accepted.
7. Management is inter-disciplinary in approach
Management is not a single subject that can be operated alone. The principles of management
take the help of various other subjects like accounts, economics, statistics, etc.
PURPOSE OR IMPORTANCE OF MANAGEMENT
1. Managing is an essential activity in every aspect of organised life.
2. Management determines the objectives of the organisation and takes step to achieve
them.
3. Management is brain of an organisation.
4. The study of management emphasises what to do and when to do.
5. Management directs the members of the organisation toward the achievement of its
objectives.
6. Management is a critical ingredient in the nation’s economic and social development.
7. Countries development depends upon good management.
8. Efficient management is key to national growth.
FUNCTIONS OF MANAGEMENT
The different functions of management are:-
1. Planning
It is defined as what is to be done, when how and by whom it is to be done. It is concerned
with determining of the objectives. It involves selecting the objective, preparing policies,
programs for achieving the goals. This function is carried out at every level of management.
2. Organizing
It is defined as to provide everything which is very essential for managing business. It involves
bringing together the different resources to achieve pre-determined objectives.
The sub functions of organizing are:
a) Defining the activities
b) Grouping the activities
c) Assigning the activities.
3. Staffing
The staffing function is concerned with human resources. It involves managing the
organization structure through proper and effective selection. It involves proper selection of
candidates, training and development, promotion and transfers, etc.
4. Directing
This function is concerned with an art of getting things done. It starts the work by instructing
subordinates, about how they have to perform jobs assigned to them. This function consists of
issuing of orders, instructing subordinates, motivating them.
5. Leading
It is nothing but influencing (a process that affects the behaviour and attitude of an
individual) an individual to work together to accomplish the organizational objectives and
making him/her to do what the leader wants him/her to do.
6. Co-ordinating
It is nothing but the harmonious blending of the activities of the different specialists or
departments to achieve the pre determined objectives. It is the orderly arrangement of group
efforts that provide unity of actions.
7. Motivating
It is nothing but an act of inducement. It is something that inspires an individual get into action n
continues him in the course of action, willingly to get the result expected out of him.
8. Reporting
It is a process of approaching or transferring the information to the people in the higher level
in the management hierarchy. It is a process done by every subordinate to his/her immediate
superior.
9. Controlling
It is the process of verifying whether proper progress is being made towards the objectives or
not. It involves:
a. Determination of standards
b. Verifying actual performance
c. Comparing actual performance
d. Taking corrective actions.
10. Budgeting
It is nothing but preparation of statements of funds and resources and allocating them in an
appropriate manner.
11. Decision making
It is concerned with evaluating the alternatives and deciding if they are appropriate and
thereby making chains among them.
LEVELS OF MANAGER
Managers are organizational members who are responsible for the work performance of
other organizational members. Managers have formal authority to use organizational resources
and to make decisions. In organizations, there are typically three levels of management: top-
level, middle-level, and first-level. These three main levels of managers form a hierarchy, in
which they are ranked in order of importance. In most organizations, the number of managers at
each level is such that the hierarchy resembles a pyramid, with many more first-level managers,
fewer middle managers, and the fewest managers at the top level. Each of these management
levels is described below in terms of their possible job titles and their primary responsibilities
and the paths taken to hold these positions. Additionally, there are differences across the
management levels as to what types of management tasks each does and the roles that they take
in their jobs.
Top level managers
Top-level managers, or top managers, are also called senior management or executives.
These individuals are at the top one or two levels in an organization, and hold titles such as:
Chief Executive Officer (CEO), Chief Financial Officer (CFO), Chief Operational Officer
(COO), Chief Information Officer (CIO) and Chair person of the Board, President, Vice
president and corporate head.
Often, a set of these managers will constitute the top management team, which is composed of
the CEO, the COO, and other department heads. Top-level managers make decisions affecting
the entirety of the firm. Top managers do not direct the day-to-day activities of the firm; rather,
they set goals for the organization and direct the company to achieve them. Top managers are
ultimately responsible for the performance of the organization, and often, these managers have
very visible jobs.
Top managers in most organizations have a great deal of managerial experience and have moved
up through the ranks of management within the company or in another firm. An exception to this
is a top manager who is also an entrepreneur; such an individual may start a small company and
manage it until it grows enough to support several levels of management. Many top managers
possess an advanced degree, such as a Masters in Business Administration, but such a degree is
not required.
Some CEOs are hired in from other top management positions in other companies. Conversely,
they may be promoted from within and groomed for top management with management
development activities, coaching, and mentoring. They may be tagged for promotion through
succession planning, which identifies high potential managers.
Middle level managers
Middle-level managers, or middle managers, are those in the levels below top managers.
Middle managers' job titles include: General Manager, Plant manager, Regional manager, and
Divisional manager.
Middle-level managers are responsible for carrying out the goals set by top management. They
do so by setting goals for their departments and other business units. Middle managers can
motivate and assist first-line managers to achieve business objectives. Middle managers may also
communicate upward, by offering suggestions and feedback to top managers. Because middle
managers are more involved in the day-to-day workings of a company, they may provide
valuable information to top managers to help improve the organization's bottom line.
Jobs in middle management vary widely in terms of responsibility and salary. Depending on the
size of the company and the number of middle-level managers in the firm, middle managers may
supervise only a small group of employees, or they may manage very large groups, such as an
entire business location. Middle managers may be employees who were promoted from first-
level manager positions within the organization, or they may have been hired from outside the
firm. Some middle managers may have aspirations to hold positions in top management in the
future.
First level managers
First-level managers are also called first-line managers or supervisors. These managers
have job titles such as: Office manager, Shift supervisor, Department manager, Foreperson, Crew
leader, Store manager.
First-line managers are responsible for the daily management of line workers—the employees
who actually produce the product or offer the service. There are first-line managers in every
work unit in the organization. Although first-level managers typically do not set goals for the
organization, they have a very strong influence on the company. These are the managers that
most employees interact with on a daily basis, and if the managers perform poorly, employees
may also perform poorly, may lack motivation, or may leave the company.
TYPES OF MANAGER
Basically there are 2 types of managers,
LINE MANAGER
Definition
Person who heads revenue generating departments (manufacturing and selling) and is
responsible for achieving an the organization's main objectives by executing functions such as
policy making, target setting, decision making. Line manager may have direct control over staff
employees.
STAFF MANAGER
Definition
Person who is responsible for the performance of functions that provide support to line
managers and does the activities that support line functions such as accounting, maintenance,
personnel management. Staff manager may not have power over line managers.
Other of managers include types,
General Managers
Plan, organize, lead and control operation of an entire organization.
Financial Managers
Plan, organize, lead and control collection and payment of money and compliance with
state and federal laws governing money management.
Marketing Managers
Plan, organize, lead and control product research, development, advertisement and
delivery.
Human Resources Managers
Plan, organize, lead and control the hiring, training and compensation of employees.
Operations Managers
Plan, organize, lead and control the production and delivery of products and services as
needed to keep external paying customers satisfied.
LEVELS OF MANAGEMENT
The term ‘levels of management’ refers to a line of demarcation between various
managerial positions in an organisation. The number of levels of management increases when the
size of the business and workforce increases. There is a limit to the number of subordinates a
person can supervise. Levels of management are increased so as to achieve effective supervision.
The level of management refers to a line of separation between different positions held by
seniors and juniors drawn with a view to distinguish each other in respect of their duties,
responsibility, rights and authority.
CLASSIFICATION OF LEVELS
There are three levels of management-
Top management
Middle management
Lower or supervisory management
Top level management
Top management of a company consists of the Board of Directors and the Chief
Executive or the Managing Director. It is ultimate source of authority and it establishes goals and
policies for the organisation. It devotes more time on the planning and coordinating functions
The functions performed by the top management are stated below
1. Top management lays down the objectives of the organisation
2. It prepares strategic plans and policies for the organisation
3. It issues necessary instructions for the preparation of budget, schedules, procedures, etc.
4. It appoints the executives for the middle level
5. It coordinates the activities of different departments
6. It controls the activities of all departments with the help of reports, memoranda, etc.
7. It builds and maintains relations with the outside public.
Middle level management
Middle level management generally consists of heads of functional departments. They are
responsible to the top management for the efficient functioning of their departments. They
devote more time to the organisation and direction functions of management. The middle level
manager includes branch managers, superintendents, heads of varies sections.
The functions performed by the middle management are as follows
1. To run the details of the organisation, leaving the top managers as free as possible of
their responsibilities
2. To cooperate in making a smoothly functioning organisation
3. To understand the interlocking of departments in major policies
4. To achieve the coordination between the different parts of the organisation
5. To build up a contented and efficient staff where reward is given according to capacity
and merit and according to chance or length of service
6. To develop leaders for the future by broad training and experience.
7. To build a team spirit where all are working to provide a product or service wanted by
the society.
Supervisory or lower level management
Lower level management refers to those executives whose work is to oversee and direct
operative employees. This level includes supervisors, foremen, finance and accounts officers,
sales officers, etc. The essential feature of this level is that managers at this level are in direct
contact with the operative employees. They are more concerned with direction and control
functions of management as compared to planning and organising. They implement the policies
of top management communicated to them by the middle level managers.
The function of lower level management
1. To plan and organise the activities of the group.
2. To arrange for necessary materials, machines, tools, etc. for workers and to provide them
the necessary working environment.
3. To provide training to the workers.
4. To supervise and guide the subordinates.
5. To solve problem of workers.
6. To communicate workers problems to the higher level management.
MANAGER VERSUS NON MANAGER
Subject Non manager Manager
Essence Change Stability
Focus Leading people Managing work
Have Followers Subordinates
Horizon Long-term Short-term
Seeks Vision Objectives
Approach Sets direction Plans detail
Decision Facilitates Makes
Power Personal charisma Formal authority
Appeal to Heart Head
Energy Passion Control
Dynamic Proactive Reactive
Persuasion Sell Tell
Style Transformational Transactional
Exchange Excitement for work Money for work
Likes Striving Action
Wants Achievement Results
Risk Takes Minimizes
Rules Breaks Makes
Conflict Uses Avoids
Direction New roads Existing roads
Truth Seeks Establishes
Concern What is right Being right
Credit Gives Takes
Blame Takes Blames
MANAGERIAL ROLES
MANAGER
A manager is one, who contributes to the organizational goals indirectly, by directing the efforts
of others and not by performing the task himself.
A role consists of the behaviour patterns expected of a manager within an organisation or a unit.
Henry Mintzberg conducted a comprehensive study of the nature of managerial roles in 1973.
He identified ten basic roles performed by the managers and classified them under three head.
1. Interpersonal roles
2. Information roles
3. Decisional roles
These roles are organized sets of behaviours belonging to a position- describes what managers
actually do, whereas functions of managers had historically described what managers should do.
Interpersonal roles
The interpersonal roles are as follows
Figurehead
This role is necessary because of the position occupied. It consists of such duties
as signing certain documents required by law and officially receiving visitors.
Leader
As a leader manages trains, encourages, remunerates, judges the subordinates.
Liaison
Manager serves as a liaison between outside contacts such as the community, suppliers
and others and the organisation.
Informational roles
The informational roles found by Mintzberg are
Monitor
As monitors, managers gather information in order to be well informed.
Disseminator
Managers are disseminators of information flowing from both external and internal
sources.
Spokes-person
As a spokes person or representatives of the organisation he speaks for subordinates to
superior and represent upper management to subordinates.
Decisional roles
The decisional roles of a manager are as follows
Entrepreneur
Acts as a initiator, designer and encourager of change and innovation.
Disturbance handlers
Takes corrective action when organization faces unexpected major difficulties.
Resource allocation
Distributes resources of all types, including time, finding equipment and human
resources.
Negotiator
Represent the organization in major negotiations affecting the manager’s areas of
responsibility. He negotiates with customers, suppliers, etc.
MANAGERIAL SKILLS
Managerial skills are the ability of a manager to make a smooth functioning team of
people working under him. Manger is to reconcile. Co-ordinate and appraise the various
viewpoints and talents of people working under him towards the achievement of organization
goals and objectives.
We can broadly classify the skills required by managers into the following three categories:
1. Conceptual skills
2. Human skills
3. Technical skills
Technical skills deal with the jobs, human skills with persons and conceptual skills with ideas.
These three types of skills are inter-related and they are required by all managers. But the
proportion or relative significance of these skills varies with the levels of management
1. Conceptual skills
Conceptual skill is the ability to see the organization as a whole, to recognize inter-
relationships among different functions of the business and external forces and to guide
effectively the organizational efforts. Conceptual skills are used for abstract thinking, and for the
concept development involved in planning and strategy formulation.
Conceptual skills involve the ability to understand how the parts of an organization
depend on each other. A manager needs conceptual skills to recognize the interrelationship of
various situational factors and therefore, make decisions that will be in the best interest of the
organization.
2. Human skills
Human skills are essential to work with others and achieve their cooperation. Human skills
are the abilities needed to resolve conflicts, motivate, lead and communicate effectively with
others. Because all work is done when people work together, human relations skills are equally
important at all levels of management. Every manager should be able to communicate effectively
and also understand what thoughts others are trying to convey.
3. Technical skills
Technical skills refer to specialized knowledge and proficiency in handling methods,
processes and techniques of specific jobs. These skills are most important at lower level of
management and much less important at upper levels.
Other essential managerial skills
Interpersonal skills –will enable to communicate with other people.
Diagnostic skills – give the ability to assess and react to individual situations.
Communication skills – relate closely to interpersonal skills and allow both relay and
receiving thoughts and ideas.
Decision-Making skills – allow recognizing problems and effectively identifying and
deciding on a plan of action.
Time-Management skills – allow organizing, prioritizing, and delegating work in the
most effective manner possible.
Key personal characteristics for managerial success
a) Physical – health, vigour, address.
b) Mental ability – to understand and learn’ judgment, mental, vigour and adaptability.
c) Moral – energy, firmness, willingness to accept responsibility, initiative, loyalty, tact and
dignity.
d) Educational – general acquaintance with matters not belonging exclusively to the
function performed.
e) Special knowledge – beat technical, commercial, financial, managerial etc..
f) Experience – arising from the work proper. The recollection of ideas of person as derived
from things.
g) Take advantage of technology.
h) Globalization
i) Entrepreneurship
j) Change in public expectation
k) Better environment for business
l) Balance of power with responsibility
m) Business has resources
n) Profit maximization
Key skills and competencies
Good Manager’s qualities should include:
Ability to make decisions under pressure.
Good communication skills.
Consultation skills.
Ability to cope with your own stress and other people’s.
Managerial skills.
Being able to work as a member of a team.
Good organization.
PRINCIPLES OF SCIENTIFIC MANAGEMENT
1. Replacing rule of thumb with science
Taylor has emphasized that in scientific management, organized knowledge should be
applied which will replace rule of thumb. While the use of scientific method denotes precision in
determining any aspect of work, rule of thumb emphasizes estimation. Since exactness of various
aspects of work like days fair work, standardization in work, differential piece rate for payment,
etc, is the basic core of scientific management, it is essential that all these are measured precisely
and should not be based on mere estimates; this approach can be adopted in all aspects of
managing
2. Harmony in group action
Taylor has emphasized that attempts should be made to obtain harmony in group action
rather than discord. Group harmony suggests that there should be mutual give and take situation
and proper understanding so that group as a whole contributes to the maximum.
3. Co-operation
Scientific management involves achieving co-operation rather than chaotic individualism.
Scientific management is based on mutual confidence, co-operation between management and
workers can be developed through mutual understanding and a change in thinking.
4. Maximum output
Scientific management involves continuous increase in production and productivity
instead of restricted production either by management or by workers. Taylor hated inefficiency
and deliberate
Curtailment of production. He decried quarrel over production and welcomed quarrel over
distribution, provided the product to be distributed had outgrown the size. Therefore he advised
the management and workers to “turn their attention towards increasing the size of the surplus
until the size of the surplus becomes so large that it is necessary to quarrel over how it shall be
divided.
5. Development of workers
In scientific management, all workers should be developed to the fullest extent possible
of their own and for the company’s highest prosperity. Development workers require their
scientific selection and providing them training at the workplace. Training should be provided to
the workers to keep them fully fit according to the requirement of new methods of working
which may different from the non-scientific methods.
FAYOL’S ADMINISTRATIVE MANAGEMENT
1. Division of work
Fayol had advocated division of work to take advantage of specialization. According to
him “specialization belongs to natural order. The workers always work on the same part, the
managers concerned always with the same matters; acquire an ability, sureness and accuracy
which reduce output. Each changes of work brings in it training and adaptation which reduces
output yet division of work has its limits which experience and a sense of proportion teach us
many not be exceeded. This division of workers can be applied at all level of organization
2. Authority and responsibility
The authority and responsibility are related, with the latter the corollary of the former and
arising from it. Fayol finds authority has continuation of official and personal factors. Official
authority is derived from the manager’s position and personal authority is derived from personal
qualities such as intelligence, experience, moral worth, past service, etc. Responsibility properly.
There should be parity of authority and responsibility.
3. Discipline
All the personnel serving in an organization should be disciplined. Discipline is
obedience, application, energy, behaviour, and outward mark of respect shown by employees.
Discipline may be of two types; self imposed discipline and command disciplines. Self imposed
discipline springs from within the individual and is in the nature of spontaneous response to a
skilful leader. Command discipline stems from a recognized authority and utilizes deterrents to
secure complained with a desired action, which is expressed by established customs, rules and
regulations. The ultimate strength of command discipline lies in its certainty of application. Such
a discipline can be obtained by sanctions in the forms of remuneration, warnings, suspension
demotion, dismissal, etc. However, while applying such sanctions, people and attendant,
dismissal, etc. However, while applying such sanctions, people and attendant circumstances must
be taken into account. This can be learned by experience and tact of the managers
4. Unity if command
Unity of command means that a person should get orders and instructions from only one
superior .The more completely an individual has a reporting relationship to single superior , the
less is the problem of the conflict in instructions and the greater is the feeling of the personal
responsibility for results.
Fayol has considered unity of command as an important aspect in, managing an organization. He
says that ‘should it be violated, authority is undermined; discipline is in jeopardy, order
distributed, and stability threatened.
5. Unity of direction
According to this principle, each group of activities with the same objective must have
one head and one plan. Unity of direction in the sense that the former is
concerned with functioning of the organization in respect of its grouping of the activities or
planning while the latter is concerned with personnel at all levels in the organization in terms of
reporting relationship. Unity of direction provides better coordination among various activities to
be undertaken by an organization
6. Subordinate of individual to general interest
Common interest is above the individual interest. Individual interest must be subordinate
to general interest when there is conflict between the two. However, factors like ambition,
laziness, weakness, etc, tend to reduce the importance of general interest. Therefore, superior
should set an example in fairness and goodness. The agreement between the employees should
be fair and there should be constant vigilance and supervision
7. Remuneration of personnel
Remuneration of employees should be fair and provide satisfaction to employees and
employers. Fayol did not favour profit-sharing plan for workers but advocated it for managers.
He was also in favour of non-financial benefits though these were possible only in the case of
large-scale organization.
8. Centralisation
Everything which goes to increase the importance of subordinate’s role is
decentralization; everything which goes to reduce it is centralization. Without using the term
centralization of authority, Fayol refers the extent to which authority is centralized or
decentralized are the question of proportion. In small firms, centralization is the natural order,
but in large firms, a series of intermediaries depends on the personal character of the manager,
his moral worth, the reliability of his subordinates, and also on the conditions or the business.
Since both absolute and relative values of managers and employees are constantly changing, it is
desirable that the degree of centralization or decentralization may itself vary constantly
9. Scalar chain
There should be a scalar chain of authority and of communication ranging from the
highest to the lowest. It suggests that each communication going up or coming down must flow
through each position in the line of authority. It can be short circuited only in special cases.
10. Order
This is a principle relating to the arrangement of things and people. In material order,
there should be a place for everything and everything should be in its place. Similarly in social
order, there should be the right man in the right place. That kind of order demands precise
knowledge of the human requirements and resources of the organization and a constant balance
between
Requirements and resources
11. Equity
Equity is the contribution of justice and kindness. Equity in treatment and behaviour is
liked by everyone and it brings loyalty in the organization. The application of equity requires
good sense, experience and good nature for soliciting loyalty and devotion from subordinate
12. Stability of tenure
No employee should be removed within short time. There should be reasonable security
of jobs. Stability of tenure is essential to get an employee accustomed to new work and
succeeding in doing it well. Unnecessary turnover is both cause and effect of bad management
13. Initiative
Within the limits of authority and discipline, mangers should encourage their employees
for taking initiative. Initiative is concerned with thinking out and execution of a plan. Initiative
increases zeal and energy on the part of human beings
14. Espirit de corps
This is the principle of union is strength and extension of unity of command for
establishing team work. The manger should encourage spirit de crops among his employees. The
erring employees should be set right by oral directions and not by demanding written
explanations
ELTON MAYO AND HAWTHORNE STUDIES
Elton mayo a hardware consultant and his associates conducted a series of studies at the
Hawthorne plant of western electronic. Originally, the research was a application of Tailors
management science techniques, designed to improve production efficiency. The first study
involved the manipulation of illumination for one group of workers and comparing their output
with that of another group whose illumination was hold constant. To the amazement of Mayo
colleagues when the illumination was increased for the test group production went up in both
groups. Further, more productivity continued to increase for both groups, even when the
illumination was decreased for the test group.
Eventually, Mayo and his associates concluded that a new “social setting” created by
their test had accounted for the increase in productivity. Their finding in now known as
Hawthorne effect or the tendency for people, who are singled out for special attention to improve
their performance.
To elaborate the study, the Hawthorne plant of general electric company, Chicago was
manufacturing telephone system bell. There were 30,000 employers employed at the time of
experiment. These were great deal of dissatisfaction of workers and production was not up to the
mark. In order to estimate the real cause behind this phenomenon a team was constituted led by
Elton Mayo (psychologist) white head & co. representative, William Dickson.
The researchers originally set out to study the relationship between productivity and
physical working conditions.
They conducted various researches in 4 phases,
1. Illumination experiment (1924-27)
2. Relay assembly test room experiment (1927-28)
3. Mass interview programme (1928-30)
4. Bank writing observation room experiments (1931-32)
1. Illumination experiments (1924-27)
Illumination experiments were undertaken to find out how varying levels of illumination
(amount of light at the work place) affected the productivity higher illumination, higher
productivity.
2. Relay assembly test room experiment (1927-28)
Relay assembly test room experiment was designed to determine the effect of changes in
various job conditions on group productivity.
3. Mass interview programme (1928-30)
During the course of experiments, about 20,000 interviews were conducted, to determine
employee’s attitude towards company’s supervision, promotion and wages. The interview
programme gave the valuable insights about the human behaviour in the company.
4. Bank Wiring Observation Room Experiment (1931-32)
This experiment was conducted to study a group of workers under conditions which were
as close as possible to normal. This group comprised of 14 workers. After the experiment the
production records of this group were compared with their earlier production records. There were
no significant changes in the two because of the maintenance of normal conditions.
The Bank Wiring Experiment included the following observation
1. Each individual was restricting output
2. The group had its own “unofficial” standards of performance.
3. Individual output remained fairly constant over a period of time.
4. Departmental records were distorted due to differences between actual and reported
output or between standard and reported working time
Criticism of human relations approach
The human relation approach has been criticised on the following grounds:
1. Lack of Scientific Validity
2. Limited Focus on Work
3. Over emphasis on group
4. Over stretching of human relations
5. Over-stress on Socio-psychological factors
6. Negative view of conflict
THE LEARNING ORGANIZATION
Many consultants and organizations have recognized the commercial significance of
organizational learning – and the notion of the ‘learning organization’ has been a central
orienting point in this. Writers have sought to identify templates, or ideal forms, ‘which real
organizations could attempt to emulate’ (Easterby-Smith and Araujo 1999: 2). In this sense the
learning organization is an ideal, ‘towards which organizations have to evolve in order to be able
to respond to the various pressures [they face] (Finger and Brand 1999: 136). It is characterized
by recognition that ‘individual and collective learning are key’.
The literature on organizational learning has concentrated on the detached collection and analysis
of the processes involved in individual and collective learning inside organizations; whereas the
learning organizations literature has an action orientation, and is geared toward using specific
diagnostic and evaluative methodological tools which can help to identify, promote and evaluate
the quality of learning processes inside organizations.
Three definitions of a learning organization
Learning organizations, where people continually expand their capacity to create the
results they truly desire, where new and expansive patterns of thinking are nurtured,
where collective aspiration is set free, and where people are continually learning to see
the whole together.- Senge
The Learning Company is a vision of what might be possible. It is not brought about
simply by training individuals; it can only happen as a result of learning at the whole
organization level. Learning Company is an organization that facilitates the learning of
all its members and continuously transforms itself. – Pedler
Learning organizations are characterized by total employee involvement in a process of
collaboratively conducted, collectively accountable change directed towards shared
values or principles. Watkins and Marsick
The following CHARACTERISTICS appear in some form in the more popular conceptions.
Learning organizations:
a) Provide continuous learning opportunities.
b) Use learning to reach their goals.
c) Link individual performance with organizational performance.
d) Foster inquiry and dialogue, making it safe for people to share openly and take risks.
e) Embrace creative tension as a source of energy and renewal.
f) Are continuously aware of and interact with their environment.
There are certain ARGUMENTS regarding the concept of learning organization, which are
listed below:
a) Focuses mainly on the cultural dimension: ‘Focusing exclusively on training activities
in order to foster learning… favours this purely cultural bias’
b) Favours individual and collective learning processes at all levels of the organization,
but does not connect them properly to the organization’s strategic objectives. It is,
therefore, imperative,
c) Remains rather vague. The exact functions of organizational learning need to be more
clearly defined.
CHARACTERISTICS OF A 21ST CENTURY MANAGER
Characteristics that result in the best performance of executive and senior level leaders
are identified along with the key skills, knowledge, and attributes of effective and
successful leaders which are then linked to a set of specific behaviours. Following an
executive summary, this manual provides an exploration of: managerial profiles; self
awareness; ethics and values; vision and mission; strategic thinking; managing the
external environment; power and influence; strategic planning and performance
measurement; collaboration; and team building.
CEOs responding to a recent survey by Chief Executive posit as an ideal a customer- and
quality-driven organization with a flatter management hierarchy. Also important, they
say, will be an organization's sense of vision - its ability to deploy a shared sense of
values in decision making - and its capacity to add significant value to products and
services.
''Breadth of training is important for the C.E.O. of the year 2000 in functions like
marketing, finance, production and human resource management.”
''Experience in diverse businesses as well as some work abroad,’’ is equally important for
an ambitious executive to perform his job effectively.
As for personal characteristics, the chief executive of tomorrow will be ''a leader, not a
boss,''- Dr.Fredrickson.
Unlike the former ITT Corporation chairman, Harold S. Geneen, an executive SHOULD
NOT be tough, autocratic, abrasive personality, which instill fear in subordinates.
The next century’s chief executive will need three characteristics - creativity, enthusiasms
and open-mindedness, the study said, and will also have a vision about the company's
strategic position in a global environment.
To convey ideas, this leader will have to be a good communicator, which means he or she
must learn the art of public speaking and develop a talent for dealing with the news
media.
The study stressed attitudinal differences among American, Japanese, European and Latin
American chief executives. The Japanese prefer future leaders with a technological
background; Americans play down foreign language ability while Europeans rank it
highly; Latin American executives expect that future company leaders should be talented
in international politics and the economics.
Aspects of business change in the 21st century. Environment of change. Business leaders know
they have to operate in this environment, where the only certainty is uncertainty. They see crises
as opportunities. Leadership in the 21st century is a collective task. There are no exceptional
individuals, just the ability to encourage good teams. Customer-oriented leadership and
transmitting that passion for the customer to the whole organisation. Experience-oriented
leadership. Appeal to emotions. Focus on innovation. Focus on a new concept of business, on
value-based management. Values are new business management tools that, unlike the classical
tools, commit and demand coherence of those who use them.
The 21st century company is a great actor of social change. We have been able to
advance in the world partly because of business. Then, what can we do to improve the business
world? The executive profile has certain risks: Over-valuing fads. Generalising the executive
profile. Thinking of the executive as a hero. Do not forget a company's missions: To provide
goods and services that are valued by its customers. To develop persons. To develop economic
values. To integrate in society, contributing something the more.
Twenty-first century leadership is going to be different from that of the 20th century. At
the same time, however, it will keep some characteristics. It will change throughout the 21st
century. It will not be the same. The factors of continuity with the 20th century: Executives will
maintain their active role in their day-to-day activities. They will also continue to be reactive.
Leadership in sundry activities. Their capabilities will include interpersonal relationships, using
their emotivity, capacity of synthesis and constant innovation. The executive will have a greater
need of a positive attitude toward learning. Also a greater capacity to cooperate with other social
institutions. The emotional component will be a differentiating value. The radius of trust is
shrinking. To lead will require building trust and first legitimacy.
SOCIAL RESPONSIBILITIES OF MANAGERS
The term social responsibility refers to both socio-economic and socio-human obligations of
the business. Every business manager should try to strike a balance between the social power and
the social responsibility. Social obligation and responsibilities of management can be studied
under two heads.
1. Internal social responsibilities
Are concerned with assuring due process, justice, equity and morality in the
selection of employees, their training and education.
2. External social responsibilities
Refer to such actions as stimulating minority entrepreneurship, improving the
balance of payment or training and hiring hard-core unemployed.
The management owes social obligations to two groups of society. They are
a) Insiders: shareholders and employees
b) Outsiders: customers, suppliers, government and the society as a whole.
Obligations and responsibilities towards shareholders or owners:
1. Stability and growth of the company
It is the duty of a manager to set that financial position of the company is good
and stable and is improving day by day.
2. Declaration of reasonable dividend
Shareholders expect a high rate of dividend on the money invested by them.
Therefore, the company must announce a reasonable dividend every year.
3. Protection of assets of the company:
The assets of the company are normally purchased with the funds provided by the
shareholders. It is the duty and responsibility of the manager that these properties must be
safeguarded.
4. Trustee of shareholder
The management is the custodian and the trustee of shareholder’s funds.
Therefore, the assets should be used for the business of the company only and the policies
followed by the manager should increase the welfare of the shareholders.
5. Information regarding financial position of a company:
It is the responsibility of the management to keep the shareholders well informed
about the progress and financial position of the company
.
Responsibilities towards customers
1. To meet needs of the consumers:
To produce satisfying goods which are capable for the consumers to purchase.
2. To produce right quality of goods:
To make goods of the right quality available to the right people at the right time
and place at reasonable prices.
3. To give prompt service to customers:
To provide adequate and courteous service to customers and to handle their
grievances carefully.
4. To follow fair trade practices:
Avoid indulging into unfair hands, unethical practices like black marketing etc.
5. True and fair advertisement:
Avoiding false advertisement and other statements to attract customers.
6. Proper distribution of goods:
The distribution of goods must be made properly so that the customers do not
have to face any difficulty in purchasing.
Responsibilities and obligation towards workers and employees
1. Fair wages
Paying reasonable wages and salaries to the employees to make them lead a
comfortable life.
2. Paying attention towards the worker’s rights
Attention towards the worker’s rights to fair wages, to participate in decision
affecting their working life to allow them to form trade unions etc.
3. Cooperation
Efforts to win cooperation of the workers by creating the conditions in which the
workers are willing to put forward their best efforts towards the goals.
4. Better working conditions
It is necessary to maintain the health of the workers.
5. Adequate service benefits
Providing service benefits like housing, medical facilities, insurance and
retirement benefits etc.
6. Opportunities for their growth
Developing their capabilities through training, education and enjoyment of
freedom of the greatest possible extent.
Responsibility and obligations towards society and community
1. To achieve socio-economic objectives
Management must try to create goodwill and reputation in the market. It should
take into consideration or indulge in any practice which is not fair and just from the social
point of view.
2. Improvement of local environment
The manager should keep the healthy environmental conditions where the
production is being carried on. He should take all the possible measure to prevent water
and air pollution and should contribute to the community development activities.
3. Help in employment opportunities
To help in the increase of direct and indirect employment opportunities to workers
in the area where the industry is functioning.
4. Welfare activities of the community
The management must provide all possible facilities and held for the upliftment of
the weaker sections of the society.
5. Efficient use of resources
The manager should plan in such a way that capital, raw material, machines,
technical knowledge etc are best utilized.
6. Follow the ethics of business
Should not indulge into anti –social and unfair- trade practices like hoarding etc
which may destroy the goodwill of the firm.
Responsibilities towards government
1. To abide by the laws of the country
2. To pay government taxes honestly, fully and in time.
3. To avoid giving bribe to the government employees.
4. To encourage fair trade practices.
5. To discourage the concentration of economic power.
6. To discourage activities this is not in accordance with the business.
GLOBAL AWARENESS
• It is a desire to learn about and a willingness to respect people from other cultures.
• The understanding that everyone has a culture which affects the way we view ourselves
and the world.
• Global Awareness understands cultures, languages & traditions other than your own.
Why is global awareness important?
College Admissions
Career Success
Help your community and nation stay competitive
Help solve the world’s problems