Week 1

Introduction
Management is the process of planning, organising, leading and controlling the resources of
the organisations to achieve the stated goals as efficiently as possible. People in general
management are the go-to leaders of businesses, places like factories, offices, restaurants, retail
stores, and hotels. In this role, you would be in charge of an organization’s daily operations,
branch, or a department. Your duties will encompass a little bit of everything. You will oversee
employees, handle bookkeeping, resolve customers' problems, maintain company culture, and
ensure your employer has everything it needs to profit from products and services.

Evolution of Management Thought

For thousands of years, managers have wrestled with the same issues and problems confronting
executives today. Around 1100BC, the Chinese practiced the four management functions.
Planning, organizing, leading and controlling. Between 400B.C and 350 B.C, the Greeks
recognized management as a separate art and advocated a scientific approach to work. The
Romans decentralized the management of their vast empire before the birth of Christ. During
medieval times, the Venetians standardized production through the use of an assembly line,
building warehouse and using an inventory system to monitor contents. But throughout history
most managers operated strictly on a trial and error basis. The challenges of the industrial
revolution changed and management emerged as a formal discipline at the turn of the century.
Thus, the management profession as we know today is relatively new. Understanding the
origins of management thought will help you grasp the underlying contexts of the ideas and
concepts. With this in mind, management thought has been broken-down into classical &
contemporary approaches.

Classical Approaches

The classical period extended from the mid – 19th century through the early 1950s. The major
approaches that emerged during this period were systematic management, scientific
management, administrative management, human relations and bureaucracy.

Systematic Management: The systematic management approach attempted to build specific

procedures and processes into operations to ensure coordination of effort. Systematic
management emphasized economical operations, adequate staffing, maintenance of inventories
to meet consumer demand and organizational control. These goals were achieved through,
careful definition of duties and responsibilities, standardized techniques for performing these
duties, specific means of gathering, handling, transmitting and analyzing information and cost
accounting wage, and production control systems to facilitate internal coordination and
communications.

Scientific Management: The scientific management advocated the application of scientific

methods to analyse work and to determine how to complete production tasks efficiently.
Fredrick Taylor identified four principles of scientific management, management should
develop a precise, scientific approach for each element of one’s work to replace general
guidelines, management should scientifically select, train, teach, and develop each worker so
that the right person has the right job, management should cooperate with workers to ensure
that jobs match plans and principles and management should ensure an appropriate division of
work and responsibility between managers and workers.

To implement this approach, Taylor used techniques such as time and motion studies. With
this technique, a task was divided into its basic movements, and different motions were timed
to determine the most efficient way to complete the task. Despite these gains, not everyone was
convinced that scientific management was the best solution to all business problems.

Administrative Management: The administrative management approach emphasized the

perspective of senior managers within the organizations and argued that management was a
profession and could be taught. An explicit and broad framework for administrative
management emerged in 1961, when Henry Fayol, a French mining engineer and executive,
published a book summarizing his management experiences. Fayol identified five functions
and fourteen principles of management which include planning, organizing, commanding,
coordinating and controlling while the fourteen principles of management are division of work,
authority, discipline, unity of command, unity of direction, subordination of individual interest
to the general, remuneration, centralization, scalar chain, order, equity, stability and tenure of
personnel, initiative and spirit de corps.

Although these perspective and recommendations were considered sound, critics noted that
they might not work in all settings. Different types of personnel, industry conditions and
technologies may affect the appropriateness of these principles.

Human Relations: The human relations develop during the 1930s. The approach aimed at
understanding how psychological and social processes interact with the work situation to
influence performance. Human relations were the first major approach to emphasise informal
work relationships and worker satisfaction. Human relations proponents argued that managers
should stress primarily employee welfare, motivation and communication. They believed
social needs had precedence over economic needs. Therefore, management must gain the
cooperation of the group and promote job satisfaction and group norms consistent with the goal
of the organization.

Another noted contributor to the field of human relations was Abraham Maslow in 1943,
Maslow suggested that human have five levels of needs. The most basic needs are the physical
needs for food, water and shelter, the most advanced need is for self - actualisation or personal
fulfillment. Although the human relations approach generated research into leadership, job
attitudes and group dynamics, it drew heavy criticism. Critics believed that one result of human
relations – a belief that a happy worker was a productive worker was too simplistic.

Bureaucracy: Max Weber, believed bureaucratic structures can estimate the variability that
results when managers in the same organisation have different skills, experiences and goals.
Webers advocated that the jobs themselves be standardized so that personnel changes would
not disrupt the organization. He emphasized a structured formal network of relationship among
specialized positions in an organization. Rules and regulations standardize behavior and
authority resides in positions rather than in individuals.

According to Weber, bureaucracies are especially important because they allow large
organizations to perform the many routine activities necessary for their survival. Also,
bureaucratic positions foster specialized skills, eliminating many subjective judgments by
managers. In addition, if the rules and controls are established properly, treatment of people,
both customers and employee. The most shortcomings stern from a faulty execution of
bureaucratic principles rather than from the approach itself. Too much authority may be vested
in too four people; the procedures may become the ends rather than the means.

The classical theory is based on the following four principles:

i. Division of labour; ii. Scalar and functional processes; iii. Structure; and iv. Span of
control.

i. Division of Labour: This theory fully depends upon the principle of division of labour.
Under the division of labour, the production of a commodity is divided into the maximum
number of different divisions. The work of each division is looked after by different
persons. Each person is specialised in a particular work. In other words, the work is
assigned to a person according to his specialisation and the interest he has in the work.
The division of labour results in the maximum production or output with minimum
expenses incurred and minimum capital employed.

ii. Scalar and Functional Processes: The Scalar process deals with the growth of
organisation vertically. The functional process deals with the growth of organisation
horizontally. The scalar principles refer to the existence of relationship between superior
and subordinate. In this way, the superior gives instructions or orders to the subordinates
(various levels of management) and gets back the information from the subordinate
regarding the operations carried down at different levels or stages. This information is
used for the purpose of taking decision or remedial action to achieve the main objectives
of the business. The Scalar chain means the success of domination by the superior on the
subordinate from the top to the bottom of organisation. The line of authority is based on
the principle of unity of command which means that each subordinate does work under
one superior only.

iii. Structure: The organisational structure may be defined as the prescribed patterns of
work related behaviour of workers which result in the accomplishment of organisational
objectives. The organisational structure is used as a tool for creating a relationship among
the various functions which make up the organisation. Specialisation and co-ordination
are the main issues in the design of an organisational structure. The term specialisation
includes the division of labour and the usage of special machines, tools and equipments.
Specialisation is obtained when a person is requested to do a single work and it results in
the increase in productivity. The facilities or advantages of suitable training, easy
allocation of work, job scheduling and effective control are also obtained from
specialisation. Co-ordination means an orderly performance in operations to achieve
organisational objectives. Normally, the business units are organised on a functional basis.
The functions are performed by different persons of different nature. It is also necessary
to co-ordinate the various functions to achieve the main objectives and at the same time a
function does not conflict with any other function.

iv. Span of Control: Span of control means an effective supervision of maximum number
of persons by a supervisor. According to Brech, “Span refers to the number of persons,
themselves carrying managerial and supervisory responsibilities, for whom the senior
manager retains his over-embracing responsibility of direction and planning, co-
ordination, motivation and control.” From the above discussion, we can know that the
classical theory emphasised unity of command and principle of co-ordination. Most of the
managers’ time is wasted in the coordination and control of the subordinates. In many
organisations, a single supervisor supervises the work of 15-20 workers and does not
follow the principle of span of control.

Some of the experts hold that a manager can supervise 4-8 members at higher levels and
between 8-20 members at the lower levels of the organisation. But according to Lyndall
Urwick, a maximum of 4 members at higher levels and between 8-12 members at lower
levels can be supervised by the superior to constitute an ideal span of control.

Contemporary Approaches

The contemporary approaches to management include quantitative management organizational

behavior, systems theory and the contingency perspective. The con temporary approaches have
developed at various time since World War II and they continue to represent the cornerstones
of modern management thought.

Quantitative Management: Quantitative management emphasizes the application of

quantitative analysis of management decision and problems. Quantitative management helps a
manager make a decision by developing formal mathematical models of the problem –
computer facilitated the development of specific quantitative methods. These include such
techniques as statistical decision theory. Linear programming, queuing theory, simulation,
forecasting, inventory modeling, network modeling and break-even analysis. Organizations
apply these techniques in many areas, including production, quality control, marketing, human
resources, finance, distribution, planning and research and development. Despite the promise
quantitative management holds, managers do not rely on these methods as the primary
approach to decision making. Typically, they use those techniques as a supplement or tool in
the decision process.

Organisational Behaviour: Organizational behavior studies and identifies management

activities that promote employee effectiveness through an understanding of the complex nature
of individual, group and organisational processes. OB draws from a variety of disciplines
including psychology and sociology to explain the behaviour of people on the job. It has
consistently emphasized development of the organisational’s human resources to achieve
individual and organizational goals. Like other approaches, it has been criticized for its limited
perspective, although more recent contributions have a broader and more situational viewpoint.

Systems Theory: Here organisations are open systems, dependent on inputs from outside
world, such as raw materials, human resources and capital. They transform these input into
output that meet the market’s needs for goods and services. The environment reacts to the
output through a feedback loop, this feedback provides input for the next cycle of the system.
System theory also emphasizes that an organization is one system in a series of subsystems.
Systems theory points out that each subsystem is a component of the whole and is
interdependent with other subsystems.

Contingency Perspective: The contingency perspective refutes universal principles of

management by stating that a variety of factors both internal and external to the firm, may
affect the organisation’s performance. Therefore, there is no one best way to manage and
organize because circumstances vary. Situational characteristics are called contingencies.
Understanding contingencies helps a manager known which sets of circumstances dictate
which management actions.

Introduction

We will examine some definitions of management in this section. It is important to remember

that there is no universal definition of management; instead, people define it in accordance with
their backgrounds, lifestyle preferences, and areas of interest. Along with its definition,
management's nature will also be examined. All of them are essential for you to understand
what you are studying thoroughly and on a solid foundation. This is significant since the
resources must be used effectively, whether you are a potential manager or an experienced
manager. Therefore, whoever has been given the responsibility of leading an organisation
should be worried about how the limited resources might be merged to achieve the desired
goals.

Definition, Nature and Purpose of Management

Management is a set of activities (including planning and decision making, organizing, leading,
and controlling) directed at an organization's resources (human, financial, physical, and
information) with the aim of achieving organizational goals in an efficient and effective
manner.

Efficient means using resources wisely and without unnecessary waste. Effective means doing
the right things successfully.

A manager is someone whose primary responsibility is to carry out the management process.
In particular. a manager is someone who plans and makes decisions, organizes, leads, and
controls human, financial, physical, and information resources.

Management is a term derived from the Italian word “Managgiare”, which literal meaning is
“to handle”

and the Latin word “Manus” which literally means “Hand”

and in the French word “Mesnagement” is a term that simply means modern-day management.
Management is a set of principles relating to the functions of planning, organizing, directing,
and controlling and the practical application of these principles while managing resources of
the company including human resources.

The management processes

Planning and decision making: determining courses of action

Planning means setting an organization's goals and deciding how best to achieve them.

Decision making, a part of the planning process, involves selecting a course of action from a
set of alternatives.

Organizing: Coordinating activities and resources

Organizing is grouping activities and resources in a logical fashion.

Leading: Managing people

Leading is the set of processes used to get people to work together to advance the interests of
the organization.

Controlling: Monitoring and evaluating activities

Controlling is monitoring the progress of the organization as it works toward its goals to ensure
that it is effectively and efficiently achieving these goals.

Kinds of managers

Differentiation by levels of management

Top managers (CEO, VP) control the organization by

setting its goals; overall strategy and operating policies.

These managers make important decisions about which activities the organization should be
involved in, such as acquisitions, research and development, and expanding capacity.

Middle managers (plant manager, operations manager) are the largest group of managers in
most companies. They primarily take the goals and strategies designed by top managers and
put them into effect.

First-line managers (foreman, supervisor) supervise and coordinate the activities of operating
employees. The majority of their work is direct supervision of the work of their subordinates.

Differentiation by areas of management

Marketing managers help to find ways to get consumers and clients to buy the organization's
products and services.

Financial managers deal with accounting, cash management, and investment functions.

Operations managers are concerned with creating and managing the systems that create an
organization's products and services. IE's are often in these positions. They achieve their goals
through production control, inventory control, quality control, and plant site selection and
layout.

Other kinds of managers have specialized management position.

Critical roles and skills

Managerial roles
Interpersonal roles

A figurehead attends activities to represent the organization.

A leader encourages employees to improve productivity and shows them how to do it.

A liaison coordinates the activities of two or more people, groups of people, or organizations.

Informational roles

A monitor actively seeks information that may be of value to the organization.

A disseminator transmits information to others in the organization.

A spokesperson transmits information about the organization to people outside the

organization.

Decisional roles

An entrepreneur develops new ideas and initiates changes in the organization.

A disturbance handler handles problems that arise such as strikes, copyright infringements, and
energy shortages.

A resource allocator determines who should receive the available resources and who should
have access to the manager's time.

A negotiator represents the organization in a negotiation setting such as collective bargaining

for a union contract or developing an agreement with a consultant.

Objective of Management

1. Organizational Objectives: Mgmt. is expected to work for the achievement of the

objectives of the particular business or organization in which it exists. Some
elements are Survival, Growth, Profits, etc.

2. Social Objectives: Managers are not the only representative of the owners and
workers, but are also responsible to the various groups outside the organization
 which creates a good corporate image in the industry. Some elements are the Supply
of quantity at reasonable prices, Creation of Employment, etc.

3. Personal objectives: An organization consists of several persons who have their

own goals and objectives. Some examples are a Competitive Salary, Personal
growth, and Skill development, a Good working environment, etc.

Principles of Management

There are 14 principles of management given by Henry Fayol that are as follows;

Division of work, Authority and Responsibility, Discipline, Unity of command, Unity of

direction, Subordination of personal/individual interests to the general interest, Remuneration,
Centralization, Scalar chain, Order, Equity, Stability of tenure of personnel, Initiative and
Esprit de corps

Styles of Management

Most of the time Style of Management is known as Types of Leadership style. A few of them
are as follows;

Democratic, Participative, Autocratic, Leadership, Collaboration, Laissez-faire, Participatory

democracy, Performance Management, Transformational leadership, Transactional leadership
and Situational leadership

Purpose of Management

1. To achieve objectives: The main purpose of management is to achieve certain objectives.

The management starts efforts to attain a desired objective and continues its struggle till it is
finally achieved.

2. Create cooperation and coordination: To crate cooperation and coordination among the
workers and departments. it is a source of crating coordination in the working of the individual
of a working group as well as among a number of working group of enterprises.

3. Elimination of waste of Resources: Another important management purpose is to eliminate

the waste of resources. It manages for effective application of management principles and
practices to eliminate the waste of resources and to accomplish the task with the least possible
cost.

4. Creating a friendly environment: Another management purpose is to create a friendly

relation among the participants of a working group devoted to the attainment of a given
objective. It makes the individual worker devoted to his responsibility attached to the
assignment given to him. Such devotion ensures the desired results of the enterprise.

5. Regulating and coordinating the activities: It refers to the functional aspect of an

organization and aims at regulating and coordinating the activities of the individual forming
the working group towards the achievement of the common goal. It provides and prescribes
functional discipline and manages to enforce it in an environment of mutual help and
cooperation.

6 Make things happen: managers focus their attention on bringing about successful action.
They know where to start what to do to keep things moving and how to follow through. It is
the management that makes things happen with the proper use of human beings’ other available
resources.

7. Solving functional problems: Another management purpose is to provide guidance in

solving the functional problems of organization and as such, is needed being a source of
guidance to organized human efforts. Moreover, it provides effectiveness to human efforts and
makes the fruit full.

8. Rational use of resources: Another purpose of management is to make arrangement for the
rational use of resources. i.e. men, money material, machine etc rational use of resources
ensures the desired objectives.

Introduction

Management has values. A value is the importance we attach to something. This means that
something is of importance to us simply because we have placed some values on it. The same
consideration goes to management. Management has importance because there are core values
associated with it. These values constitute the reasons why we bother to study management.

Values of Management
Values in management are guidelines or principles that leaders use to make decisions and
determine courses of action. Organizations may also refer to them as core, organizational, or
corporate values. These values are often derivative of a company's mission statement or
strategic plan.

To keep pace with the Environment: To keep pace with the environment is one of the values
of management. The environment of management is a dynamic one; that is, it is always
undergoing changes. It is never static. The practice of yesterday becoming obsolete today. To
be abreast with these changes demands thorough planning, plan execution, control and
evaluation. All these and more demand careful thinking and analysis so that we may not make
mistakes in our decisions. Every economic activity must be directed towards ensuring that the
desired goods and services are produced and made available to the consumers at a profit too to
the organization. Committing mistakes along the line in the process of taking decisions can be
fatal. This is because every business decision or any management decision necessitates the
expenditure of organization resources.

Establishing Integrity: Organisations typically expect each team member to cooperate and
uphold its brand and reputation. Values can help establish the integrity of a company. When a
manager or leader holds themselves accountable for their values, it sets an example for the rest
of the organization to do the same. It also allows customers and stakeholders to identify the
organization's core values and build a long-term relationship with the company.

Developing Employee: Companies benefit from utilizing their core values system when
helping employees develop to their fullest potential. Managers are also much more effective
and credible when training their employees if they're operating under the same set of values as
the rest of the organization. Values are crucial to employee development because they help
management understand the behavioural expectations of the company and how to best help
develop the skills of their team members. They also provide a framework for training and
development programs. For example, if an organization values collaboration, managers can
provide training on how to work effectively with others

Defining Management Behaviour: The value system of an organization defines and

influences the behaviour of its management team, which may include managers, supervisors,
and executives. This helps a company's leadership become more effective and credible when
making decisions, implementing policies, managing team members, and communicating with
employees and customers. Strong leadership helps a company develop a culture that's
consistent with its values, which enables them to attract and retain employees who can best
serve its needs.

Setting Behaviourial Expectation: An organization's value system helps define the kind of
behaviour they expect from employees. Companies accomplish this by creating clear
guidelines for each of their core values. For example, a values statement may include respect,
integrity, and commitment. This helps leaders identify the standards of behaviour the company
expects from team members and determine the behaviours that don't align with the
organization's values. Clearly defining acceptable behaviour in the workplace helps employees
understand how to conduct themselves while also providing guidance on how to improve in
areas where this is necessary.

Promoting Good Work Ethics: While each member of the organization possesses their own
set of skills, beliefs, and goals, having a set of values that all members strive to follow promotes
a unified work ethic. When team members understand their role in the company, they may feel
more motivated to do their best work and be productive members of the organization. This can
help a leader identify gaps in the skill sets of their team and identify opportunities for
developmental growth. It also helps team members develop a strong work ethic, which may
contribute to the company's success

Fostering Innovative Change: A good values foundation also promotes innovative change.
When team members understand the vision of the company, they are able to innovate new
products, services, and processes that may benefit the organization. A values-based
organization also promotes a culture of continuous improvement, which allows team members
to discover better ways to perform their job duties and serve the company's customers. This
process can help a company identify opportunities for growth and increase its competitive
advantage in the industry

Serving as a Guide for Character Building: While the purpose of organizational values is to
guide the behaviour of team members and the actions of the company, in many cases, they also
serve as a guide for character building outside of the organization. They're practical points that
may encourage individuals to also apply them in their personal lives. For example, values such
as integrity, honesty, and respect are common among many businesses because they're
important in the workplace. While this is the case, they're also applicable outside of the work
environment because they can help individuals achieve their personal goals.

Inspiring Personal Development: Part of the core values of many organizations is the
encouragement of personal growth among their employees. Managers often take pride in the
progress their team makes, which results in them providing opportunities for team members to
develop their skills and abilities. These may come in the form of professional development,
such as training, education, or certification, or through the encouragement of self-
improvement. It may also be the case that a manager helps an employee advance their career
within the organization by providing developmental opportunities, such as leading a project or
taking on a new responsibility

Improving the Company’s Performance: Values are essential for managers to help improve
the performance of the organization. The structure helps leaders identify their goals and
prioritize actions to achieve them and provides a clear set of standards for team members to
follow to improve their productivity. A values system serves as a tool for leaders to assess their
decisions. When they're considering a course of action, they can refer to the company's values
to determine which direction is the most effective. This helps them avoid making decisions that
may not be in the best interests of the organization

The clear structure of a values system also makes it easier for managers to communicate their
decisions and the actions they're taking to achieve their goals. This helps them build a strong
leadership team and demonstrates their commitment to the company's mission. It may also
inspire team members to work harder to achieve the company's goals, which may result in an
improvement in the organization's

Management Objectives and Management Skills

The structure and strength of a management system can influence the overall success and
productivity of an organization. Management objectives aim to create achievable goals and
purposes for managers to implement and strive toward. If you're interested in working in
management, you might benefit from understanding the processes and meaning of common
management objectives. In this study, we define and list 11 common objectives of management
to help you identify and set proper goals

Therefore, a management objective refers to the primary goal of a management team or system.
These goals dictate the actions, decisions and regulations created by an organization's
management. Managers often share goals with employees and executives to develop a
consistent purpose and strategy for all members of the organization

There are 11 objectives for management teams to improve and develop the operations of an
organization:

Optimize resources: Management teams work to use resources effectively to provide the most
output possible. This objective creates the ability to increase profits by reducing the ratio of
resource costs to profits. Management teams implement logistic strategies and procedures to
identify and reduce processes that create waste and require extra resources.

Increase efficiency: Increasing the efficiency of operations, production and services allows
for greater production, sales and profits. Management systems track the processes, duration
and flow of the workplace to determine methods that provide more efficient outcomes.
Managers may work with other employees and department leaders to create and implement
new processes and requirements

Maximize profits: Management teams aim to find the balance between maximizing profits
and promoting a beneficial workplace for employees. Maximizing profits includes working
with various departments and leaders such as accountants, supervisors and executives to
determine areas that require improvements and changes. Managers can achieve maximum
profit objectives by identifying unnecessary expenses and waste and creating new procedures
for more efficient operations.

Promote personal development: An effective management team prioritizes the growth and
development of its employees. Providing opportunities such as seminars, mentorship programs,
training resources and internal promotions allows employees to develop new skills and advance
their careers. The personal development and growth of employees can also contribute to the
growth, quality and efficiency of work produced and can help management achieve multiple
objectives simultaneously

Maintain quality: Management teams handle the regulations, procedures and parameters for
the production and distribution of products and services. A primary objective of management
includes maintaining the quality standards necessary for the organization. The team
collaborates with other departments, supervisors and employees to create, implement and
maintain quality

Uphold workplace morale: The environment, attitudes and morale of an organization can
affect the overall production and profits. Positive morale among employees creates intrinsic
motivation for employees to complete tasks and contribute greater effort. Management teams
work to uphold morale by implementing effective authority structures, creating incentive
programs and responding to employee feedback. Valuing employees and ensuring positive
relations increases morale and motivates individuals to continue to grow

Reduce risk: Many management positions focus on forecasting and projecting results and
changes. One main objective for managers includes using planning and predictions to reduce
opportunities for risks and losses. Reducing risk factors such as safety issues, wasted resources
and extra expenses can help increase profits and eliminate loss

Generate business strategy: Management teams often use higher-level critical thinking and
abstract strategy to improve operations and profits. The team collaborates with executives,
leaders and stakeholders to generate, pitch and implement overall business strategies or
frameworks. Creating an effective and consistent business strategy can help identify and
narrow objectives for all employees to reach a common goal

Coordinate workflow: The workflow and internal structure of an organization can influence
productivity and efficiency. Management teams may include or work with logistics,
engineering and production professionals to develop logical and expedited workflows, internal
structures and facility designs. Managers may also utilize tools such as organization charts,
flow diagrams and procedure audits to evaluate and communicate workflow operations
Identify talent: An organization's management aims to identify, acquire and maintain top
candidates and employees. Managers may work with recruiters to establish hiring
requirements, evaluate candidates and create recruitment offers. Identifying and gaining
talented and qualified employees increases the knowledge, expertise and production of the
organization as a whole

Ensure availability: Management teams work to handle, maintain and predict the availability
of resources, goods and services. To achieve this objective, managers may project and forecast
the needs of the organization or public and monitor issues such as shortages. Predicting and
handling issues allows the management team to plan and implement changes to prevent
production and distribution delays

Management skills can be defined as certain attributes or abilities that an executive should
possess in order to fulfill specific tasks in an organization. They include the capacity to perform
executive duties in an organization while avoiding crisis situations and promptly solving
problems when they occur.

Management skills can be developed through learning and practical experience as a manager.
The skills help the manager to relate with their fellow co-workers and know how to deal well
with their subordinates, which allows for the easy flow of activities in the organization.

Management and leadership skills are often used interchangeably as they both involve
planning, decision-making, problem-solving, communication, delegation, and time
management. Good managers are almost always good leaders as well.

In addition to leading, a critical role of a manager is to also ensure that all parts of the
organization are functioning cohesively. Without such integration, several issues can arise and
failure is bound to happen. Management skills are crucial for various positions and at different
levels of a company, from top leadership to intermediate supervisors to first-level managers.

Types of Management Skills

Technical Skills: It involve skills that give the managers the ability and the knowledge to use
a variety of techniques to achieve their objectives. These skills not only involve operating
machines and software, production tools, and pieces of equipment but also the skills needed to
boost sales, design different types of products and services, and market the services and the
products.

Conceptual Skills: These involve the skills managers present in terms of the knowledge and
ability for abstract thinking and formulating ideas. The manager is able to see an entire concept,
analyze and diagnose a problem, and find creative solutions. This helps the manager to
effectively predict hurdles their department or the business as a whole may face

Humans or Interpersonal Skills: The human or the interpersonal skills are the skills that
present the managers’ ability to interact, work or relate effectively with people. These skills
enable the managers to make use of human potential in the company and motivate the
employees for better results.

Examples of Management Skills

There is a wide range of skills that management should possess to run an organization
effectively and efficiently. The following are six essential management skills that any manager
ought to possess for them to perform their duties:

1. Planning

Planning is a vital aspect within an organization. It refers to one’s ability to organize activities
in line with set guidelines while still remaining within the limits of the available resources such
as time, money, and labor. It is also the process of formulating a set of actions or one or more
strategies to pursue and achieve certain goals or objectives with the available resources.

The planning process includes identifying and setting achievable goals, developing necessary
strategies, and outlining the tasks and schedules on how to achieve the set goals. Without a
good plan, little can be achieved.

2. Communication

Possessing great communication skills is crucial for a manager. It can determine how well
information is shared throughout a team, ensuring that the group acts as a unified workforce.
How well a manager communicates with the rest of his/her team also determines how well
outlined procedures can be followed, how well the tasks and activities can be completed, and
thus, how successful an organization will be.

Communication involves the flow of information within the organization, whether formal or
informal, verbal or written, vertical or horizontal, and it facilitates the smooth functioning of
the organization. Clearly established communication channels in an organization allow the
manager to collaborate with the team, prevent conflicts, and resolve issues as they arise. A
manager with good communication skills can relate well with the employees and, thus, be able
to achieve the company’s set goals and objectives easily.

3. Decision-making

Another vital management skill is decision-making. Managers make numerous decisions,

whether knowingly or not, and making decisions is a key component in a manager’s success.
Making proper and right decisions results in the success of the organization, while poor or bad
decisions may lead to failure or poor performance.

For the organization to run effectively and smoothly, clear and right decisions should be made.
A manager must be accountable for every decision that they make and also be willing to take
responsibility for the results of their decisions. A good manager needs to possess great
decision-making skills, as it often dictates his/her success in achieving organizational
objectives.

4. Delegation

Delegation is another key management skill. Delegation is the act of passing on work-related
tasks and/or authorities to other employees or subordinates. It involves the process of allowing
your tasks or those of your employees to be reassigned or reallocated to other employees
depending on current workloads. A manager with good delegation skills is able to effectively
and efficiently reassign tasks and give authority to the right employees. When delegation is
carried out effectively, it helps facilitate efficient task completion.

Delegation helps the manager to avoid wastage of time, optimizes productivity, and ensures
responsibility and accountability on the part of employees. Every manager must have good
delegation abilities to achieve optimal results and accomplish the required productivity results.
5. Problem-solving

Problem-solving is another essential skill. A good manager must have the ability to tackle and
solve the frequent problems that can arise in a typical workday. Problem-solving in
management involves identifying a certain problem or situation and then finding the best way
to handle the problem and get the best solution. It is the ability to sort things out even when the
prevailing conditions are not right. When it is clear that a manager has great problem-solving
skills, it differentiates him/her from the rest of the team and gives subordinates confidence in
his/her managerial skills.

6. Motivating

The ability to motivate is another important skill in an organization. Motivation helps bring
forth a desired behavior or response from the employees or certain stakeholders. There are
numerous motivation tactics that managers can use, and choosing the right ones can depend on
characteristics such as company and team culture, team personalities, and more. There are two
primary types of motivation that a manager can use. These are intrinsic and extrinsic
motivation.

Bottom Line
Management skills are a collection of abilities that include things such as business planning,
decision-making, problem-solving, communication, delegation, and time management. While
different roles and organizations require the use of various skill sets, management skills help a
professional stand out and excel no matter what their level. In top management, these skills are
essential to run an organization well and achieve desired business objectives.

Functional Authority and Staff Limitation

The assignment of responsibility with the corresponding authority is usually made to the
manager and the subordinates that report to him. Consequently, functional authority refers to
the right which an individual or department has through the process of delegation to control
specified processes, practices or other matters relating to activities in other departments. For
example, in the production department, there are the production managers in addition to other
personnel working under him. There are issues relating to recruitment of personnel, salaries
and wages administration, promotion, industrial relations among others which the production
 manager cannot handle in relation to his subordinates. He cannot handle them because he was
not trained for that kind of process and practices. He is an engineer. The only person competent
to handle these matters is the personnel officer or manager, even though he is not in the
production department. But by virtue of his training, education, experience and expertise he
can handle all matters relating to personnel management in the production department and
other departments, due to his expertise and the right or authority to handle personnel issues has
been delegated to him and to nobody else. He thus has the functional authority over personnel
issues in all the departments in the organization.

Functional authority is usually a restricted kind of line authority. It gives a staff person a type
of limited line authority over a given function, such as safety or quality, regardless of where
that function is found in the organization.

For example, a staff safety specialist may have functional authority to insist that line managers
follow standard safety procedures in their departments. The staff safety specialist may have
top management’s blessing to dictate to lower-level line managers exactly what they must and
must not do concerning any matter that falls within the realm of safety. A human resources
specialist may say to a line supervisor that the latter cannot fire a certain employee.
A cost accountant may notify line departments that certain cost information must be furnished
weekly

Imperative of Functional Authority

1. it makes the manager to exercise his authority by employing his expertise on matters relating
to his training.

2. it makes everyone on the organization to know who is to do what at every point in time.

3. it makes every member of the organization to respect one another since each one knows he
cannot do everything. What cannot be done by another?

4. it affords the experts to concentrate on the areas they have a flair for.

The delegation of Functional Authority

One can better understand functional authority by thinking of it as a small slice of the authority
of a line superior.
A corporation president, for example, has complete authority to manage a corporation, subject
only to limitations placed by such superior authority as the board of directors, the corporate
charter and bylaws, and government regulation.

In the pure staff situation, the advisers on personnel, accounting, purchasing, or public relations
have no part in this line authority, their duty being mere to offer counsel.

But when the president delegates to these advisers the right to issue instructions directly to the
line organizations, as shown in the figure, that right is called “functional authority.”

The four staff and service executives have functional authority over the line organizations
concerning procedures in the field of accounting, personnel, purchasing, and public relations.

What has happened is that the president, feeling it unnecessary to clear such specialized matters
personally, has delegated line authority to staff assistants (or managers) to issue their
instructions to the operating departments.

Limiting the Area of Functional Authority

The functional authority should be carefully restricted to limited functions.

For example, the functional authority of the personnel manager of the general line organization
is ordinarily limited to prescribing procedures for the recruiting and selecting of employees but
does not include telling departments which candidates are to be selected.

Likewise, a purchasing manager’s functional authority is limited to setting the procedures for
departmental purchasing and does not include instructing departments what they can purchase
or when.

Demerits of Functional Organisation

Lack of unity of command; Lack of coordination; Difficult to maintain discipline; Costly

organizational structure and Difficult in fixing responsibility.

Unity of command is a classic principle of management theory in which each employee only
responds to one supervisor.
Limitations of staff Relationships

The staff concept even though it has some usefulness in an organization has some limitations
which can be seen from the following:

1. Absence of responsibilities for results

The role of the staff manager is simply to advice. The outcome of such advice rests on the door
step of the line manager, on the acceptance of the advice or plan. As a result, when a plan fails,
the line manager will like to blame the staff manager for providing a poor plan. The staff
manager can on his own side would return the blame on the line manager for not acting
correctly accordingly to guidelines provided in the advice. He could go on to extend the
argument that the plan was good but the incompetence f the line manager to execute the plan
properly created the poor result.

2. Undermining line authority

Sometimes, it gets into the head of a staff manager to start undermining the authority of the
line managers. Such situation arises if the staff officer is seen to be good in his job and as a
result, a superior officer starts having greater confidence and reliance on him. By reason of the
new importance being placed on him, he starts undermining the authority of line manager. Such
situation is dangerous because it can result in anger, frustration and outright concerned and the
staff officer. All these pollute the internal environment of the organization which does enhance
maximum productivity.

3. Feeling of sense of superiority

The line manager since he is one of those formulating personnel policy administering salaries
and wages among other personnel duties. But these are the functions of personnel management
and not production.

Consequently, he is not qualified to do them. As the organization keeps developing, a stage

will reach when it becomes necessary to remove these personnel duties from the production
manager and assign them to a personnel manager who has been trained and possesses the
necessary expertise to handle personnel issues. When the decision is taken and implemented
the production manager may not like it. For one reason, while performing these personnel tasks
as well as his normal production duties, he arrogates to himself more power, more prestige and
even more status symbols. Some of these vanish overnight and to this extent brings conflict
between him and the new personnel manager.

4. Due to changes in technology

Technology is simply the manner of doing something to get a desired output. As a result of
changes in technology, the work of the line managers may become simplified. Some aspects
of the job may even be taken away by computers and robots. As a result, those skills which
have been developed by the line managers over many years are lost overnight to machines.
And these machines are manned by staff specialists. Take the case of an accountant boasting
his unique skills of having a flair for figures and can balance manually. With the introduction
of computer, this can be done in split second. Even when the accountant is computer literate,
his level of mastery of computer cannot be compared to a computer graduate who is a staff
specialist. This is another source of conflict.

5. The work of the line manager being easily controlled

When the line manager was doing so many activities, it was difficult to monitor, check and
control his activities. But when the activities have been reduced, the portion remaining in
smaller and can be easily controlled by a superior officer. To this extent, the line manager may
not like the development, it is not everybody that can easily subject him to control.

6. Due to changes

Many staff managers, once employed, are associated with bringing changes and innovations.
They formulate plans and play key roles in executing these plans which are usually associated
with changes. But human beings generally including line managers resist changes. As a result,
the new development brings conflict between the two managers.

7. Differences in age

This is another possible source of conflict. The staff managers are usually younger in age than
the line managers. It is not every one that can take directives from a younger person.
Consequently, the age difference is a source of conflict.

Delegation & Centralisation of Authority

Centralization and Decentralization are two modes of working in any organization. In
centralization, there is a hierarchy of formal authority for making all the important decision for
the organization. And in decentralization decision making is left for the lower level of
organization. What is the difference between centralization and decentralization in detail with
their advantages and other factors.

A simple way to understand if an organization is working in a centralized or decentralized manner

is by looking at two important aspects:

1. The place of the decision-making authority in the hierarchy of the management i.e.
Centralized.

2. The degree of decision-making power at the lower echelons in the organization i.e.
Decentralized.

An organization has a greater degree of decentralization if the number of decisions made and
functions affected at the lower level are higher. Further, while decentralization and delegation of
authority might seem similar, you must not confuse one with another. A decentralized way
of working is more about the philosophy of the organization.

Unlike delegation, it is not just about handing over a part of the authority to a subordinate but a
way of approaching the decision-making process in the organization. Decentralization is a choice,
while delegation is a must. Advantages of centralization and decentralization:

Advantages of Centralization

• The organization can strictly enforce uniformity of procedures and policies.

• It can help in the elimination of overlapping or duplicate activities and save costs.

• The organization has a better chance of utilizing the potential of its outstanding employees.

• It offers a better control over the activities of the organization by ensuring consistency
in operations and uniformity in decision-making.
Advantages of Decentralization

• Faster decision-making and better quality of decisions

• Improves the effectivity of managers.

• Offers a democratic environment where employees can have a say in their governance.

• Provides good exposure to mid and lower-level managers and creates a pool of promotable
manpower with managerial skills.

• Since managers can see the results of their own actions, they are more driven and have
improved morales.

Both centralization and decentralization have their own advantages and disadvantages. Even if an
organization is working in a decentralized manner, some functions are usually centralized.

Factors determining the Degree of Decentralization

While the degree of decentralization depends on a wide range of factors which are different for
different organizations, here is a common list:

Significance of the decision

Decisions which are costly either in terms of money, goodwill of the company, employee morale
and other such decisions which are significant to the organization are centralized at the top-levels
of the organization. Therefore, even in a decentralized organization, these decisions are made in
a centralized manner. It is not that high-level managers do not commit mistakes.

However, the enterprise expects them to commit fewer and less-critical mistakes. This is because
they are trained, experienced, and have the right information to arrive at the best decision. From
observation, it is evident that the primary factor behind centralizing authority is the weight of
responsibility since delegating authority does not imply delegating responsibility.

Size of the Enterprise

The size of the organization is an important factor which determines the degree of
decentralization. A larger firm needs more decisions. Also, a large-sized company has numerous
departments and levels. Coordinating all of them and consulting several specialists and executives
can take a lot of time, delaying the decision.

And delayed decisions tend to cost more. Segregating the organization into smaller decentralized
units enhances efficiency and minimizes costs. Organizations try to ensure that the size of each
unit is such that it is easily manageable and decentralize authority accordingly.

The Attitude and Philosophy of the Management

Decentralization is the dispersal of authority. Therefore, the attitude of senior management plays
an important role in the extent and mode of authority dispersal. Usually, senior executives with a
traditional mindset are a little skeptical about decentralizing authority.

On the other hand, executives with a rational managerial temperament rely on the participative
approach of doing work. These executives try to make the best out of individual initiative and opt
for decentralization.

Control Techniques

In most organizations, senior management believes that some vital aspects like the price of the
product, credit offered, etc. must have a uniform policy.

And centralization is the best way to achieve this. This desire to control these aspects deters the
organization from allowing even the regional offices to make decisions about these aspects. There
is no denying the fact that a uniform policy has many advantages. However, the organization
cannot ignore the costs involved in centralized decisions.

Also, low and mid-level managers find their initiatives arrested and see few opportunities to grow
within the organization.

Availability of Capable Executives

Many times, senior executives are willing to disperse authority but are unable to find qualified
and capable junior managers to do so. This dearth of capable executives can restrict the nature and
extent of decentralization.
Further, many organizations train the junior managers to bring them up the curve. Interestingly,
decentralization offers many opportunities to impart the training too.

External Environment Influences

Many external forces also play an important role in determining the mode of decentralizing
authority. External forces like government control, unions, fiscal policies, etc. are some examples.

Delegation vs Decentralization

Points Delegation Decentralization

It involves the entire

organization – from
It usually involves two people –
Nature the top management
a manager and his subordinate.
to individual
departments.

The control lies with

The manager or the delegator the concerned
Control
controls it. departments or
sections.

This is an optional
All organizations need
mode of working.
delegation to get things done.
Need Organizations can
Delegating authority is essential
also work in a
to assign responsibility.
centralized manner.

The delegator can delegate The head of the

authority but the responsibility department is
Responsibility remains with him. The responsible for the
delegator is accountable for the activities performed
task. under him.
Therefore,
 responsibility is
fixed at the
department-level.

Helps in the creation

Creates better superior-
Relationship of semi-autonomous
subordinate relationships.
units.

Organizational Chart

Organizational diagram or chart is a diagram that visually conveys a company’s internal

structure by detailing the roles, responsibilities and relationships between individuals within
an entity

KEY TAKEAWAYS

• An organizational chart graphically represents an organization's structure, highlighting

the different jobs, departments, and responsibilities that connect the company's
employees to each other and to the management team.
• Organizational charts can be broad-based, depicting the overall company, or can be
department- or unit-specific, focusing on one step on the move.
• Most org charts are structured by using the "hierarchical" model, which shows
management or other high-ranking officials on top, and lower-level employees beneath
them.
• Other types of charts include the flat org chart, the matrix chart, and the divisional org
chart.

Organizational charts graphically display an employee's hierarchical status relative to other

individuals within the company. For example, an assistant director will invariably fall directly
below a director on the chart, indicating that the former reports to the latter. Organizational
charts use simple symbols such as lines, squares, and circles to connect different job titles that
relate to each other.
Regardless of an organization's structure, org charts are extraordinarily useful when an entity
is contemplating restructuring its workforce or changing its management complex. Most
importantly, org charts let employees transparently see how their roles fit into the overall
company structure.

Hierarchical Organizational Chart: This most common model situates the highest-ranking
individuals atop the chart and positions lower-ranking individuals below them. Organizational
hierarchies generally depend on the industry, geographical location, and company size. For
example;

• President
• Senior vice president
• Vice president
• Assistant vice president
• Senior director
• Assistant director
• Manager
• Assistant manager
• Full-time employees
• Part-time employees
• Contractors

Other Types of Organization Charts

• Flat — also known as a "horizontal" chart, the flat org chart positions individuals on
the same level or only a few levels, indicating more power equality and autonomous
decision-making ability than is typical with employees in hierarchical corporations.
• Matrix — This more complicated organizational structure groups individuals by their
common skill-sets, the departments in which they work, and the people they may report
to. Matrix charts often interconnect employees and teams with more than one manager,
such as a software developer who is working on two projects—one with their regular
team manager, and another with a separate product manager. In this scenario, the matrix
chart would connect the software developer to each manager they are working with,
with vertical lines.
 • Divisional — This chart subdivides the company based on some specific criteria. It
could be by product lines offered or geographic regions. An example would be an auto
manufacturer organizing its company by product type. The respective divisions would
have a certain autonomy but this would likely incur additional overhead cost.

Why Is an Organizational Chart Important?

Org charts depict an organization's hierarchy, which can clearly identify seniority and lines of
authority that ought to be followed. It can also show which roles are responsible for what tasks,
divisions, departments, or regions. This can remove ambiguity and improve communication.

What Are the Most Commonly Used Organizational Charts?

The two types of organizational chart formats that are most often used are hierarchical and flat.
Hierarchical is the most common and it shows the ranking of individuals based on their role in
the company in a descending vertical order. A flat format, also known as a "horizontal"
organizational chart, places all individuals on only a few levels or just one level, and is
indicative of an autonomous decision-making ability where this power is equally shared.

What Are Other Types of Organizational Charts?

Less commonly used, but still effective in defining roles, are the matrix and divisional
organizational charts. The matrix organizational chart groups individuals by their common
skill-sets, the departments in which they work, and the people they report to. It is dubbed
"matrix" as it shows employees and teams interconnecting with more than one manager.
Divisional would show the organization of a company based on some specific criteria, say a
product line or geographical area. For example, an auto manufacturer might be organized
based on the different types of products they offer.