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UNIT - 1: INTRODUCTION TO MANAGEMENT STRUCTURE 10 Legening Objectives 1,41 Introduction 12 What is Management? [3 Definition of Management 140rigim 0 Management Lã Nature É Management 1.6 Evolution of Management 1.7 Purpose of Management 1.8 Importance oÉ Management [9 Applications to Management LIO Scientific Management LIM Human Relation Approach “12 Systems Approach «13 Principles of Management “13.1 Henry Favol Approach 13.2 Fredrick Taylor Approach 14 Management Roles “15 Summary 16 Keywords ATO Leaming Activity «18 Unit End Questions 119 References LO LEARNING OBJECTIVES After susdying this unia, you will be able to: e Explain concept of management e Discuss he nature of management * Explainthe process of management a Identify roles and levels of à manager 1,1 INTRODUCTHON The basic unit of a society is the individual. Bui no individual cam satisfy all his desires himself. Theretore, he unites with his fellow-beings and works do am organizad group to achieve what he cannot achieve individually, Tt is primary force within the group or organisation which tends 10 lead dt twrds the group goal, Managemena is required to plan, organize, coordinate amd control he alfates of the orgemisatton. Without, management, resources of producto remeim resources merely amd never become production. Mansgement 18 a universal process im all organized social and economie activities. Wherever there ds human activity, there is management In business filocd management is mot restrictod to Factory, shop or office but is also useful in government enterprises, educational institutions, health services, military organizations and so om. A manager appbics his knowledge and skill ima wide varicty of enterprises. 1,2 WHAT IS MANAGEMENT Management is essential at all levels of an organisation. But the word management has been given different interpretations. Mis used as a noun, a process. and a separate discipline. Management as a Nou: En gengral, und popular usage, management refers to a distinct group of people who direct fhe metivitres ol other people ar muterial resources towaod the mtunment of predetenmined gonls. Giving a broader meaning to it, one cam look mt management as à resource, a system of auihority, and a class or elite. + Management as an economie resource: The economista vicw-cf management is that ie isa factor of producton just like entrepreneueship, capital and Eabour, The managerial resource, to a large extom, determines organisational eficetiveness and elficiency. Hence in à dynamic envirenment managenal development 15 more important and 1t5 use must be more intensive. * Management as a system of authority: Management is a system 0 authority in the sense that it consists ola team of managers who are responsible for making decistons and supervismg the work of others. Managers at different levels possess varying and performance driven. All these aspects are bringing a new paradigm to the term “management” and managers m Business firms guide business through capidly changing environments. Management is lhe process of achieving organizational goals by working ill people and by using other orpanizational resources. Management cam also be understood as he application of policies, procedures and strategies in a logical manner to achieve business objectives. In general, the term management has three important characteristics: “Management is the an of focusing on business and organizational goals * lisa process of continuing related activities in an organization + Management is a skill of reaching organizational goals by working with people und by using organizational resources The im management can be understand as the accomplishing of these treco characteristics by using resources elfectively and eMiciemy to generate valve for the organization Management Innovations 2008). Je is the act cf gettimg people together for the purpose of secomplishing desired goals and objecives using resources effectively. In an orgumization, management encompasses planning organizing, stalfing, leading or directing und controliing people and'or entítics to accomplish a goal. Management can be understood in many ways, for instance in a business firm, managenent is the deployment and manipulation of resources, which implies manipulation of people, financial resources, technclogical resources and implementing systems for driving business goals. Soch organizations can be viewed as systems management because they facilitue the production of useful business outcomes From a system, The objectives of ithis unit are provided in the next section. 1.3 DEFINITION OF MANAGEMENT The term management 15 quite broad, but the fovus is mostly on human beimgs or for everyihing where humans are concermed, This 1s because humans build, develop and sustarm organizations either big or small, Lawrence Appley provided a people-oriented definitica of management which states as, “Mernagement às toe enccomplidaraent ql remendos tleronagde ee efforto af tie people This definition 1 more synomymous of Abraham Lincolns famous words that management 150 the people, by the people and for the people. The recent developments in globalizatios and advances in Human Resources Management (HRM) emphasize the critical importance of human beings in the organizational set up. Human Resource (HR) professionals and practitioners explain that management is concerned with emplowées both as individuals and as à group in attamming goals. Management deals with understanding emotional behaviour and social aspecis of people. Similar to HR, marketing management also involves people who practice human centric concepts in promoting products or services. Management involves four distinct processes mamely planning, organizing, staiTing and controlling of people to determine performance of he Firm, achieve siated objecnves and accomplish goal by using resources. In the cúrrent corporate seenario, management encompasses activities such às social amd environmental responsibility, phifanthropic activities to crente a positive image among people. This is because the firm's management was um obligation towards the society amd environment Tor their survival and prosperity. Successful business firms fulfill expectations of owners, employees, consumers, government and community at Earge through its products, services ul policies. For example, companies such as TATA, Bira, Jindal, ete, have been promoting social cause theough their Corporate Social Responsibility (CSR ) activities by way ef cunmng schools, providing health care facolitics, promoting livelihood activitres and provide many basic facilities to people in remote mural areas in India. Management is q eritical process in running organizations, either big or small Given Below are some commen and general definitions om management provided by some of the experts. Stanley Vance provided a deciston-oriented definition, “Management io simply the process of decision emadimg anal contro! ever the action of human beings for the expressed purpose of attialning pre-determined goals." MeFarand provided a funerion-ori ented definition, “Menrageneno ds define fo conmceprtal, aheoresteal ano! cmuelydcal purposes cs hat process dp miich managers create, divert, emeinradoe qr aperaie puepenive ergantzanenis chrocglo evtentarte, comedia do apermtionatize homo efforts Henry L Sisk defines management as, “he coserdinenicas el all resources through tre process of planning orguaizingo directing amd comiroiling im order to atoin stated abjectives” Eoonts ando 0'Donmell defined minugement as, SMeanagentent de the creation and eeaintenance of am intermeal encirommneno dr am enterprise where inclividaals, working im basic form of coins allowed for increased trade because a person wanting to obraim a good or service no longer had to find another person who wanted exactly the good or service he produced. Coordinating the activities of those who provided goods and those who wanted to purchase them ofien required coordination, one of the main Functions oÉ a manter. (Attribution: Copyright Rice University, OpenStax, under OC-/RY 44 Hicense) Early Contributor Outcome Source: Adapted from Crorge (1972) and Wren & Bedean (2009) Sumerians Hammurabi Nebuchadnezrar Ancient Egvptians Sun Tau Ham dynasty (26 BO-22 AD) Ancient Grecks Ltaliams John Florio Writing and trade Written commands and controls Incentives Division of labor, coordination and spam of control Division of labor, communication and coordimatron Development of Burenucraçy Division of labor Standardizanion Accounting, corporations, multimitional corporations Management to Enplish lampuape Two additional contributions to the carly development of management came From the Middle East. The idea of written laws and commands comes from the Babylonian King Hammurabi (1810 BO-1750 BC). AYren, D.A, de Bedean, 4 6. 2008 The evolution of management thought (óth ed.) Now Work: Wiley. The Code 0É Hammurabi was a listing of 282 laws that regulated a wide variety of behaviors, including business dealimgs, personal bchavior, interpersonal relations, and punishments. Law UM was one of the first instances of aecounting and of the necd fer formal rules for managers ando omnes. The code also set wages for doctors, brcklapers stonemasons, boaimen, herdsmen, and other labors, The code did not, however, include the concept of incentive wagges because il set wages at a fixed amount The idea of incentives would come from another, much later, Babylonian King, Nebuchadiezzar (605 BC-c, 562 BC), Avren, D. A. & BRedean, À 6. 2008 The evolution of management thought (Gth ed), New “Pork: Wiley, who gave incentives to cloth weavers for production? Weavers were paid in food, and the more cloth they produced, the mare fool they were given. Hamurabi The Code 0É Hamurabi ts a well-preservod ancient luw code, created between [810 BC and 1734 BC in ancient Babylon, Ts a listing of 282 Jaws that regulated conduct on a wide vartetr of behaviors. including uesimess dealings, personal bebavior, imterpersonal relations, and pomishiments, Law LM as one of the fest instances of accounting and the need for formal rudes for cmeners and managers. (Cubrielhs Barmçy é Flickr/ Atiributon 2.4 Genero (DO Br 2.04 were able to buibd im later contures, Alhough we ame still uncentaa about exactly love lhe pramids were constructed, we have some idea that the process required a great number and wide range of slave lahorers to construct them. Each laborer would have a different task. done; After the collapse of the Roman Empire, there was a decline in European tmde. Seholars refer to this time as the Dark or Middle Ages (500 AD-LODO AD), due its Incation bemween the classical world of the Grecks and Romans and the wortd of the Renaissance. While ihere was litite trade or economic development in Europe during this period, trade Mourished im the Muslim and Chinese worlds, Various travelers, such us | Mh-century latim merchani and explorer Marco Pólo, provided renders wiih tales and goods from ihose roominig somethes, NWvhat were the contributions of the following groups to modem management: Sumerians, Balyylonians, Egyplians, Chinese, Gréeks, and Romans? Deseribe management im the ancient word, Ne can track the concept cf management from its development under the Sumerians. The Sumerians provided the concepts of writing and record keeping that allowed for an urban economy to develop, which in tum led to the establishment of small businesses. The Egyptians helped to pioncer the ideas of specialization of lahor, spam of control, and hierarchy of command. Sun Teu developed sobdivistons, various tonkings of authority, asd coordination. The Gregks and Romans built forerunners of the modem corportion and aguibds. 1.5 NATURE OF MANAGEMENT An analysis of the various definitions of management indicates that management has certain characteristhes. The Following are the sulient characteristics 0 management. 1. Management aims at reaping rich results in economic terms: Manager's primary task is to secure the productive performance through planning, direction and comrol. It is expected of the management to bring into being the desired cesulis. Rational utilisation of available resources to maximise the profit is he economic function of a manager. Professional manager cam prove his administrativo talent only by economising the resources and enbancing profit. According to Kimball, “management is the art of applving the economie principles that underhe the control of men amd materials m the enterprise under consideramon”. tá Management also implies skill and experience in gening mhings done through people: Management involves doing te job dirough people. The económico function of carning 1 profitable return cannot be performed without enlisting cooperation and securing positive response from “people”. Getting the suitable type of people to execute the operations às the significant aspect of management. In the words of Eoontz and O Donnell, “Management is hear of getiing ihines done through people in formally organised roupa”, Management às à process: Management is 4 process, function or activity. This process continues till the objectives set by administration are actually achieved. “Management is a social progess involving co-ordination of human and material resources through the funetrons 07 plaming organising, stafTing. leading and controlling in order to aecomplish stated objectives”, Management ds o universal activity Management os not applicable to business underakimgs onhy dt is applicable to political, social, religious and educational institutions also. Management is necessary when group eHort is required. Management is a science as well as an art: Management is an art because there are definite principles of mam genment Tt is also a science because by the application of ese principles predetermined objectives can be achieved. Management às à profession: Management is gradually becoming a profession because there are established principles of management which are being applied in proctice, ami il involves specialised truning amd is govemed by ethical code arising out of fts social obshigatimiis, Management sam endesvour 10 sehteve pre-determned objectives: Management ds concemed with directing and controlling ol the various getiviies of the organisation do attain the pre-detormined objectives. Every managerial activity has certain objetivos. In fact, management deals particulary with dhe actual direcring of human eftóris. Management às a group activity: Management comes into existence only when there is a group setivity towards a common objective. Management is always concerned will group efforts and not individual efforts. To achieve the goals of um organization management plans. organises, co-ordinates, directs and controls the group effort. Management és a system Of authority; Authority means pomer to make dhers act in a predetenmined manner, Management formalises a standard set of rules and procedure to be dollomed by the subordinates and ensures their compliance with the rules and management but does not exacdy answer what management is? To have an exact answer to the question it is necessary to know the meanings of the terms “Science” and “Art”. What is “Science”? Setence maw be described, “us a systematio body of Enowledes pertaiming to am area of study and contains some general truths explaiming pastevents or phenomena”. The above definition com three important characteristics of science. They are: Do isa systematized body of knowledge amd uses scientific methods for observation, 2. hs principles are evolved on the basts o! continued observation and experiment, and 3. hs principles are exmet and have universal applicability without any limitation, Judging from the above chameterisios of science, it may be observed that: e Management is a systematized body 08 knowledge and its principles have evolved on the basis of observatron. e The kind vf espermentation (as in natural sciences) canmol be necompanied im the arca of management since management deals with the human element. In management, dl is mol possible to define, analyse and measure phenomena by repeating the same conditions over and over again to obtain a provê. e The above dbservalion puts a limitalioa ón management as a setence. Management like other social sciences can be called as “inexaet science”, What is “Art? “Art cefers to “the way of doing specific things; it indicates how an objective is to be achieved.” Management like amy other operational activity has to be an art Most 0f the managerial acts have to be cultivated as arts of atinining mastery to secure nction and results. The above definition contains three important characteristics of ar. They are: = Artis lhe application of science, Mis puiting principle into practice, a After knowing à particular art, practice às needed to reach the level of perfection. * tis undertaken for accomplishing an end through deliberate cfforts. Judging from the above characteristics of an, ilmay be observed ihai: * Management while performing the activitics 0É getting things done by olhecs às required to apply the knowledge of certain underlying principles which are necessary for every art, * Management gets perfecton in he am of managing only through continucus practice, * Management implies capacity to apply aceunately the knowledge to solve lhe problems, to face the situation and to realize the objectives fully und timely. The above ohservation makes managemem en art and that toa fine art. Management is both a Seiençe as well as an Art; Management às both a sctence as wecll as am art, The science of management provides certain general principles which can guide the managers in their professional cffort. The art of management consists jm tackling every situation in am effective manner, As a matter of fact, neither science should be over-emphasized nor should be the art discounted; the science and heart of management go vogether and are both mutually interdependent and complimentary, Management as thus a setence as well as am art, Mocun be sad that" the art of management às as ohd as human history, but lhe setence oU munagement os am event ol he recent past” The similares amd distinchons between management and adimimetratios 15 another area for much debate by experts. Some experts feel that these are two separe functions, bul some other experts explam that there is tio fundamental difference between management and administration, Some management experts view and explain that administration is a part of management. Some of the views provided by experts on lhis issue are presented below: Administration is above Management: Adminisiration determines specific goals and defines broad areas in which those goals can be achieved. Administration is a function for policy making. Oliver Sheldon explains that. “administration is the function in industry concemed with the determination of the corporate policy, the co-ondimation oÉ finance, production and distribution, the sememento of the compass of orgimisation and the ultimate control of executive. Management is the function im industry concemed with execution of policy, within ee limits set up by the adiministration ando the employment ol the organisation for the particular objects set before dt However, some management experts explain that management is am executive function whereas administrat às largely determinative. Hence, we-can understand that the focus of administration is decision making and policy formulation whercas management às the execution 0 policies developed by udiministration. Management and Administration ds same: Experts such as Henri Fayol, Koonto and &Donnell and William Newman treat management and administration as the same thing. These experts provide the argument that there is no distinctton betwcen these two terms and research and development. This development was copied by other groups and exists even today. In prehistoric times the first developers of ihe whecl did not have any formal organization and they passed ever this technologa to all interested groups. An early strategy dates back to 153, wlren Machiavelli an Italian thinker anda great belicver im lhe viriues of a republico In his book “Disconrses" he explined certain principles, which are true even in today's modem management practices. The thoughts explained bw him are: a Am organization is more stable if members have the tight to express their differences and solve their comílicis within it. b. Am organization ie hosting when the founder is beflim the care of many and ven many enem adesere dor oraintaim dt. E A weak manager must Follow a strong one, but not another weak come and maintain authority, d. A manager desiring to change am established organization must retuim at beast a shadow of ancient customs. The insights provided by Machiavelli teach us important lessons in the history and thoaght of management. Management did not originate in America or Europe in the 21s century. The teem management came into existence during [70H Management and organizalions are q product of social structures and places having historical rooas. Early management theory comsisted 0 many atempts at Enowing these orgamizutons developed during the industrial revolution and to the new comers of 19º century in Europe and in USA. In this unit early management theories are explored for their importance in knenwving the principles and concepts of management While the approsches given by experts and resparchers are studied, il is important to understand that human relationships take center stage in the area of management The unit presents different approaches and perspectives of management, the approaches covered are the classical approach which deals wilh scientific and administrative management, Behavioaral approach, quantitative approach, contingeney approach and finally the TT based approseh along with systems perspective. Management experts over lhe passage of time have found principles to deal with situation that keeps changing amd new perspectives are developed over time. The unique knowledge galherod by understanding these approaches and perspectives have resulted in knowledge based on testing and using them im cealtime situations. This knowledge has resulted in the “Sehool of Management Thought”, The objective of this unit is to understand the major development of management thought. History lelps us to understand om today's management lheones and practices and help to examine hat has ovorked and liar will mor mvork correctly, Many historical endeavors and monumens were developed by people responsible for platming, organizing, leading, and controlling activities. These practices have existed since historical times, For example, the Taj Mahal, Esyptian pyramids, the Great Wall of China, the Qutub Miner, and many others arc examples of tangible evidence to project tremendous scope by employing tens of iousands 0F people amd were completed in ancient times. In fact, pyramids were construcied by oecupying more than DOMODO aorkers for 20 years 1a think how those projects are completed, we comé across quests such às: 2 Who told each eorker war to do? * Who ensured tasks for workers and ensured sufficient resources are available at dhe site? The answer to the above questions is managers. Regardkss 0É what hese individuals were calhed, someone had to plan evhar was to be done, organize people and materials to do it, lead and direct the workers, and impose some controls to ensure that everything was done as planned, In 1776, Adam Smith published the book “The Wealth 0f Nations” in which be vrgued that economic advantages, organizations and society would gain is from the division of labour (or job specializatton). This implies that there must be a method of breakdowm É jobs into narrow and repetitivo tasks. Using die pin industry as an example, Smith claimed that 1 individuals, cach doing a specialized task, could produce about 48,000 pins per day among them. However, il cach person worked alone, performing each task separately, il would be quite am accomplishmment 10 produce even O pins per day! Smith conciuded ihat diviston of labour increased producivivo by increasing each workers skill and desterity, saving time dn changing tasks, and creating Jabour saving inventions and machinery. Specialized jobs continued to be popular. Other similar examples of team work can be found in manulacturing industries, DT software service companies, sports and so on The nest important event is the industrial revolution. This started in bate eightcenth century when machine power was substituted for human power it became more economical to manufácture goods im factores than at home. These large, eficeent faciones needed someone Resides the growing competition in business, the complexity of managing business also has imercased hecause of the following points. * Increasing size ob business orgamzations e High degree of division of labour and specialization * Increased government regulations and controls tó make business more socially- oriented * Organtsed union activittes to put pressures om management e Pressure ol various confliciing interest groups to meet their demands from lhe organizations. The above factors such as growing competition and complexity mm managing business firms have created a demand for efficiency in management process which cannot be realized by mere by trial-and-emror methods but by developing and applying sound management concepts and principles. Further, the above fictors hive emerged gradually inch altracted aitenton from a variety of experts from different domams, imtellectuals, coonomists, sociobogists, psyobologists, anthropologists, mathematicians, and management practitioners to stady organizations and processes through which these organizations could be made more etrcetive. Each of these groups of intellectuals viewed organizational activities and the processes in scientific ways and made recommendations accordingly. The final results are evident in the form of a variety ol orientations and approsches in management wilh clear demareation and overlapping processes, The evolution of management thought is shown in table 2-1 belmwo Management Thought Period Early contributions Upito 19º century Scientific Management 19D0-1930 Administrative, Operational Management 19L6-1940 Human relations approach 1930-1950 Social systems approach 1940-1950 Decision theory approsch 1945-1965 Management science approach 19350-[ 960 Human behaviour approach 1950-1970 Systems approach 1960 omwands Contingency approach [570 omwards Table 1,1: Table showing evolution of management thought Management thought is classified as classical, neociassical and modern, Classical approach cefers to scientific management and acdininistrative operational management, Nesvlassical approach includes human velations approach amd some relevant part ol social swstems approach, Decison dhcore approach, mumpgement science approach, and Human behaviour approach, Modem approach meludes systems approach, contingency approach, and some relevant portion cf the ahove approsches not included in meoclassical approach. Management classifications can be time specific because what is practiced today may not he continted dn future. The next section discusses the importance of classical approach to management. The general characteristics of the term “management” are provided below: Management ts human activity amd a process of organized actmity: The focus of management aetivity às to develop people and not to dimect people or things. Management deale with human organizations and hence management is important, unhke animals that are traincd. Management is concermed with using resources efficiently and hence it is the process of imterrelased elements mumely planning, orgamizing, eading and controlling. Management is referred to as group effort or activity An crganizatios exists to achieve certain objectives and they are more easily achieved by involving a group of people than by am individual. Am individual cannot satisfy all his needs and desires all by himself, but if heishe unites with fellow humans and works in an organized manner the needs can be fulfiled easily This analogy works well for business organizanons. Business finms operate as & group to achieve business results as Lawrence Appley provided a people-oriented definition for management which states, “Management is the accomplishment of results rough the 20 
