Engineering Management

Engineering management is the application of engineering methods, tools, and techniques to

business management systems. Engineering management is a career that brings together the
technological problem-solving ability of engineering and the organizational, administrative, legal and
planning abilities of management in order to oversee the operational performance of complex
engineering-driven enterprises.
Engineering management covers the gap between engineering and business management, namely the
combination of technical and economic decision-making with analytical skills, optimization
capabilities, and technical product development. the first revolution was powered by steam; the
second one by electricity; and the third one by computing. This new and fourth industrial revolution, as
many believe, is being powered by data and AI. Companies who are restructuring or building
themselves to thrive in it form what we call, Industry 4.0.

Importance of management in Technology driven environment

1. Rapid Innovation

Effective technology management empowers businesses to innovate rapidly, responding promptly

to market shifts and customer needs. This adaptability ensures organizations remain at the
forefront of innovation, delivering enhanced customer experiences and maintaining their
competitive edge.

2. Risk Mitigation

One of its critical aspects is the ability to assess and mitigate risks associated with technological
changes. Thus, by effectively managing these risks, organizations can take calculated steps into
new territories, fostering an innovative culture where employees are empowered to experiment
and take well-considered risks.

3. Cross-Functional Collaboration

It promotes collaboration across different departments and teams. This interdisciplinary

collaboration also leads to the emergence of creative solutions and innovative breakthroughs as
diverse perspectives converge.

4. Employee Empowerment

Technology management encourages employee participation in the innovation process. When

employees have access to the right tools and training, they can actively contribute by generating
innovative ideas and translating them into action.
 Engineering Functions Engineering – the art of making things work

Engineering is the application of science and mathematics by which the properties of matter and the
sources of energy in nature are made useful to people in structures, machines, products, systems and
processes. Teamwork Engineers typically work in a team environment with constant communication – you
may have one person from each functional area or several depending on the size and complexity of the
project.

Organization of Functional Groups

• Research and Development
• Design
• Manufacturing
• Sales
• Purchasing
• Service
• Subcontractors

Organization of Skills

• Engineers – responsible for ensuring that systems and devices are specified to operate within their
theoretical limits, specify materials and sizes of parts & assemblies so failures do not occur.
• Designers – responsible for product’s fit and finish – ergonomics & aesthetics.
• Packaging Engineers – ensure the product is packaged properly to avoid damage, etc. • Drafters –
responsible for documentation.
• Fabricators – making parts according to specifications.
• Inspectors – ensure that the products meet the specifications.
• Technicians – responsible for operation and maintenance – they assemble various components to create
working devices or structures, operate them, and maintain them.

What Does an Engineer Do?

Engineering Functions

Research
• Research engineers are knowledgeable in principles of chemistry, biology, physics, and mathematics.
• Computer know-how is also recommended.
• A Masters Degree is almost always required, and a Ph. D is often strongly recommended.
• Development engineers bridge the gap between the laboratory and the production facility.
• They also identify problems in a potential product by building prototypes.
• An example is the development of concept cars for companies like Ford and GM. Testing
• Testing engineers are responsible for testing the durability and reliability of a product and making sure
that it performs how it is supposed to. Testing engineers simulate instances and environments in which a
product would be used.
• Crash testing of a vehicle to observe effects of an air bag and crumple zone are examples of a testing
engineer’s duties.

Design
• The design aspect is where largest number of engineers are employed.
• Design engineers often work on components of a product, providing all the necessary specifics needed to
successfully manufacture the product.
• Design engineers regularly use computer design software as well as computer aided drafting software in
their jobs.
• Design engineers must also verify that the part meets reliability and safety standards required for the
product.
• A concern always on the mind of design engineers is how to keep the development of a part cost
effective, which is taken into account during the design process.

Analysis
• Analysis engineers use computational tools and mathematical models to enrich the work of design and
research engineers.
• Analysis engineers typically have a mastery of: heat transfer, fluid flow, vibrations, dynamics, acoustics,
and many other system characteristics.

Systems
• Responsible on a larger scale for bringing together components of parts from design engineers to make a
complete product.
• Responsible for making sure all components of a product work together as was intended by the design
engineers.

Manufacturing & Construction

• Work individually or in teams
• Responsible for transforming raw materials into finished product.
• Keep records of processes and equipment.
• Help with design process to keep costs low.

Operations & Maintenance

• Responsible for setting up and maintaining the production line.
• Must have technical know-how to deal with problems.
• Responsible for inspecting the facility and equipment. Must be certified in various inspection methods.

Technical Support
• Works between sales, customers and producers.
• Typically will have knowledge of the technical aspects of product.
• Must have good interpersonal skills.

Sales
• Sales engineers have technical background, but are also able to communicate effectively with customers.
• The job market for sales engineers is growing, due to the fact that products are becoming more and more
technically complex.

Consulting
• Consultants are either self-employed, or work for a firm that does not directly manufacture products.
• Consulting engineers might be involved in design, installation, and upkeep of a product.
• Sometimes required to be a registered professional engineer in the state where he/she works.
• Consultants are typically required to have expertise within the areas where they are consulting.
Note: At smaller companies, a single engineer will tend to do most of these functions. At larger companies,
especially if working on large scale projects, an engineer will tend to work mostly within one functional
area.
Quality Assurance

• Developing and implementing quality assurance policies and procedures.

• Designing and executing testing plans to ensure that developed software meets the technical
requirements and standards.
• Identifying defects and inconsistencies in software and production processes.
• Collaborating with software developers and other team members to find solutions to quality issues.
• Maintaining documentation of test results, and preparing detailed reports on the findings.
• Ensuring compliance with national and international quality standards.
• Monitoring all stages of software development to identify and resolve system malfunctions to meet
quality standards.
• Reviewing quality specifications and technical design documents to provide timely and meaningful
feedback.
• Creating detailed, comprehensive, and well-structured test plans and test cases.
• Prioritizing, planning, and coordinating quality testing activities.
• Performing thorough regression testing when bugs are resolved.
• Monitoring debugging process results.
• Investigating the causes of non-conforming software and training users to implement solutions.
• Staying up-to-date with new testing tools and test strategies.

IT systems
The primary responsibilities of an IT Systems Engineer revolve around maintaining and improving an
organization’s IT infrastructure. Some of the key tasks include:
System Design and Implementation: IT Systems Engineers are responsible for architecting systems that
meet the organization's needs. This involves understanding business requirements, designing systems that
align with these needs, and overseeing the implementation process.
Maintenance and Troubleshooting: Once systems are implemented, maintenance and continuous
monitoring are crucial. IT Systems Engineers ensure all systems perform optimally, troubleshooting issues
and implementing fixes as necessary.
Network Management: They manage and maintain network infrastructure, ensuring that connectivity
remains stable and secure. Tasks might include configuring routers, switches, and firewalls, and monitoring
network performance.
Server Administration: Managing servers is a significant part of the role. IT Systems Engineers set up,
configure, and maintain servers, ensuring they run efficiently and securely. This includes managing virtual
environments and cloud-based servers.
Security Management: Ensuring the security of systems and networks is paramount. IT Systems Engineers
implement security measures, monitor for potential breaches, and respond to security incidents.
Disaster Recovery: Developing and implementing disaster recovery plans is crucial. IT Systems Engineers
ensure that backup systems are in place and regularly tested, minimizing downtime in case of an
emergency.
Documentation and Reporting: Keeping detailed records of system configurations, changes, and incidents is
important for the ongoing maintenance and auditing of IT systems. IT Systems Engineers produce
documentation and reports to support transparency and future planning.
 Planning
Planning is the fundamental management function, which involves deciding beforehand, what is to be
done, when is it to be done, how it is to be done and who is going to do it. It is an intellectual
process which lays down an organization’s objectives and develops various courses of action, by which
the organization can achieve those objectives. It chalks out exactly, how to attain a specific goal.

Planning is nothing but thinking before the action takes place. It helps us to take a peep into the
future and decide in advance the way to deal with the situations, which we are going to encounter in
future. It involves logical thinking and rational decision making.

Characteristics of Planning

1. Managerial function: Planning is a first and foremost managerial function provides the base for
other functions of the management, i.e. organising, staffing, directing and controlling, as they are
performed within the periphery of the plans made.
2. Goal oriented: It focuses on defining the goals of the organization, identifying alternative courses
of action and deciding the appropriate action plan, which is to be undertaken for reaching the
goals.
3. Pervasive: It is pervasive in the sense that it is present in all the segments and is required at all the
levels of the organization. Although the scope of planning varies at different levels and
departments.
4. Continuous Process: Plans are made for a specific term, say for a month, quarter, year and so on.
Once that period is over, new plans are drawn, considering the organization’s present and future
requirements and conditions. Therefore, it is an ongoing process, as the plans are framed, executed
and followed by another plan.
5. Intellectual Process: It is a mental exercise at it involves the application of mind, to think, forecast,
imagine intelligently and innovate etc.
6. Futuristic: In the process of planning we take a sneak peek of the future. It encompasses looking
into the future, to analyse and predict it so that the organization can face future challenges
effectively.
7. Decision making: Decisions are made regarding the choice of alternative courses of action that can
be undertaken to reach the goal. The alternative chosen should be best among all, with the least
number of the negative and highest number of positive outcomes.

Importance of Planning

• Planning provides direction: Planning provides direction and a sense of purpose for the
organization. Without plans and goals, organizations merely react to daily occurrences
without considering what will happen in the long-run. Plans avoid this drift situation and
ensure that short-range efforts will support and harmonize with future goals. It helps an
organization decide what to do and when to do it. It reduces aimless activity and makes
action more meaningful.

• Planning provides a unifying framework: A plan helps people to set priorities and put
effort accordingly. A plan tells everyone what the organization hopes to achieve and what
the contribution of each department must be, and who is to utilize resources to achieve
 the goals. Plans help in coordinating effort at various levels. In the absence of a plan, the
organization would be pulled in different directions, creating confusion and
misunderstanding at various levels.

• Planning is economical: Effective plans coordinate organizational work and eliminate

unproductive effort. Guess work is banished. Facilities are employed to the best
advantage. Waste motions and idle facilities are removed By focusing attention on what is
to be done, how and when it is to be done, plans help an organization to economically
utilize the physical and financial resources. This, ultimately, improves efficiency of
operations.

• Planning reduces the risks of uncertainty: Planning helps an organization to cope with an
uncertain future. It helps management to anticipate the future and prepare for the risks by
making necessary provisions to meet the unexpected turn of events. Planning minimizes
the chances of mistakes and unpleasant surprises because obje ctives, policies and
strategies are formulated after a careful scrutiny of internal as well as external
environment. Planning, thus, seeks to minimize risk while taking advantage of
opportunities.

• Planning facilitates decision making: Decision-making involves searching of various

alternative courses of action, evaluating them and selecting the best one. Planned targets
serve as the criteria for the evaluation of different alternatives so that the best one may be
chosen. If there are no plans for the future, there are few guidelines for making current
decisions. For example, decisions have to be made in present for a product to be
introduced three years in the future. When future plans exist, decisions consistent with the
future plans are made. Further, without plans, people will make decisions according to
their own preference rather than those of the organization.

• Planning encourages innovation and creativity: Planning involves looking ahead and
preparing for the future. The process of looking ahead, forces an organization to be alert
of opportunities and threats in the environment. It forces managers to find out new and
improved ways of doing things in order to remain competitive and avoid the threats in the
environment. It compels the managers to be creative and innovative all the time. Planning
helps managers to visualize problems early and take suitable remedial steps. It helps them
exploit opportunities and come out as ‘winners’ in a competitive world.

• Planning improves morale: Once members know what is expected of them, they can
contribute better. When goals are properly defined, work assignments can be fixed and
everyone can begin to contribute to the achievement of these goals. This produces
improvements in morale. Further, planning permits employees to participate in the
thinking process. This helps them develop a broad mentality. Also, when the plan is
actually translated into action, they feel that it is their own plan. Positive attributes are,
thus, developed.
• Planning facilities control: Planning and controlling functions are said to be ‘Siamese
twins’ (inseparable twins). There is nothing to control without planning and without proper
control, planning proves to be a wasteful and an unproductive exercise. Plans serve as
yardsticks for measuring performance. They help in channelizing behaviour in the right
direction. They help in preventing mistakes, oversights and deviations.

Steps of Planning Process

The planning process involves several key steps that managers must follow:

Setting Objectives:

This marks the beginning of planning, where clear goals are defined for the organization.
Objectives are specific, measurable end results that the management aims to achieve. Each
department sets its objectives within the overall framework of the organizat ion’s goals. For
instance, a mobile phone company might set a target to double its sales to 200,000 units next
year.

Developing Planning Premises:

Planning is future-oriented and requires understanding external events that could impact
decisions. These events, known as planning premises, are assumptions based on which plans
are made. For example, a mobile phone company might base its sales objective on favorable
government policies promoting digital transactions.
Identifying Alternative Courses of Action:
After setting objectives and making assumptions, various ways to achieve the goals are
explored. Multiple alternatives, such as price reduction, increased advertising, or improved
after-sales services, are identified.
Evaluating Alternative Courses of Action:
Each alternative is carefully evaluated, considering both positive and negative aspects. Factors
like cost, risks, and returns are assessed within the planning premises and available resources.
The evaluation helps in weighing the pros and cons of each option.
Selecting One Best Alternative:
The most profitable plan with minimal negative effects is chosen and implemented. Managerial
experience and judgment play a vital role in this decision-making process. For instance, a mobile
phone company might opt for increased TV advertisements, online m arketing, and excellent
after-sales service.
Implementing the Plan:
This step involves putting the chosen plan into action. Managers communicate the plan clearly
to employees, allocate resources, organize labor, and procure necessary machinery. For
example, a mobile phone company might hire more salespeople, create TV adve rtisements,
initiate online marketing activities, and establish service workshops.
 Levels of Planning

The three levels of planning

Strategic, tactical, and operational. These are the three levels of planning that work interdependently and
harmoniously to ensure the success of the organization in the short, medium, and long term.

Briefly, we can think that the strategic level is responsible for the overall direction of the company, while
the tactical level translates this direction into specific actions. The operational level, on the other hand, has
the role of ensuring that daily activities are carried out efficiently.

When all levels are aligned, the company has more chances of achieving consistent results and a smooth
workflow. To simplify the understanding of the concepts, how about getting to know the details and
applications of each one?

Strategic planning
Strategic planning can be considered the highest level among the three, as it involves definitions that
impact the company as a whole. Its main objective is to answer the questions: “where are we?” and
“where do we want to go?”.
Therefore, it relates to the general guidelines of the organization, such as vision, mission, and long-term
goals, as well as the key strategies to get there. Also, it is at the strategic level that we consider external
and internal factors, such as market analysis, competition, available resources, and organizational
competencies.
This type of planning foresees the direction that the company will follow for a long time, as well as guiding
all decisions of leadership and its representatives during the period.
An example for you to better understand: a technology company identifies growth opportunities in the
international market. So, it establishes as a vision “to become one of the leading brands of electronic
devices in the world.” Thus, it defines long-term objectives, such as increasing market share and expanding
operations to five new countries.

Tactical planning
Tactical planning relates to the implementation of everything that has been defined at the strategic level.
In other words, this is where goals are transformed into concrete and executable actions.
Therefore, the main purpose of the tactical level is to answer the question: “how will we achieve our
strategic objectives?”. For this, we establish medium-term action plans, identifying the necessary activities
and assigning responsibilities to each department or team of the company.
It is the tactical level that will coordinate the different areas so that, together, they achieve the general
directions of the company.

Example: with the strategic planning defined, the marketing department of the technology company
develops a tactical plan to achieve international expansion. They identify target countries based on market
research and develop specific strategies for each one. In parallel, the production department develops a
tactical plan to increase production by 30%, ensuring that the company has the capacity to meet the
growing demand in new markets.
Operational planning
Operational planning works on the daily activities of the organization and focuses on answering the
question: “how will we execute our goals and tactical plans?”. Thus, it must respect and reflect the
guidelines already established in the previous levels.
Its nature is short-term and provides practical instructions on how tasks should be performed. This
includes defining deadlines, allocating resources, and monitoring the progress of each activity, in order to
achieve efficiency and quality in operations.
In addition, the operational level involves solving day-to-day problems. Therefore, management must be
prepared to deal with contingencies, make quick decisions, and ensure that operations continue.
Example: with tactical definitions, operational planning comes into play to ensure the execution of daily
activities. The sales teams of the technology company begin to serve international customers, offering
support and ensuring their satisfaction in purchases. In the production department, the team manages the
growing demand. They monitor raw material stocks, monitor the efficiency of the assembly line, and
implement continuous improvements in production processes.

• Strategic planning: Strategic planning is the process of setting long-term goals and objectives
for an organization, and determining the best course of action to achieve them. This level of
planning typically involves high-level decision-making and is focused on the overall direction
and vision of the organization. It is often done by top management and stakeholders, and it can
take into account both internal and external factors that may impact the organization's success.
• Tactical planning: Tactical planning is the process of developing specific plans and actions to
implement the strategic goals and objectives. This level of planning is typically focused on a
time horizon of one to three years and involves a more detailed analysis of the resources
and capabilities needed to achieve the strategic goals. It is often done by middle management
and is focused on the specific steps and actions that need to be taken to achieve the strategic
goals.
• Operational planning: Operational planning is the process of the day-to-day management and
execution of plans and actions to achieve the tactical goals. This level of planning is focused on
the short-term and is often done by front-line managers and employees. It involves the
management of resources, such as people, equipment, and materials, and the coordination of
activities to achieve the tactical goals. This level of planning is often called "business as usual"
and is focused on the day-to-day operations of the organization.
 Level of
Time Horizon Focus Decision Makers
Planning

Strategic Long-term (3+ Overall direction and vision of the Top management and
Planning years) organization stakeholders

Medium-term (1-3 Specific steps and actions to

Tactical Planning Middle management
years) achieve strategic goals

Operational Short-term (Less Day-to-day operations and Front-line managers and

Planning than a year) management of resources employees
 Organizing
What is Organising in Management?
Organising refers to a process consisting of a series of steps to identify and group various activities, collect
or assemble various resources and establish authority relationships with responsibility amongst job
positions. It can be mentioned as collecting and utilizing human and non-human resources to implement
plans in a highly effective and efficient manner. It is to achieve the overall plan of the organization. In
other words, it refers to the process of arranging people to work together and accomplish a common
goal. It is a process of identifying activities to be performed, grouping these activities into work units,
assembling tasks for the various job positions, defining rules, and establishing the authority,
responsibility, and relationship amongst them.
Definition of Organising
• “Organising is a process of defining and grouping the activities of the enterprise and
establishing the authority relationships among them. In performing the organising function, the
manager defines, departmentalizes, and assigns activities so that they can be most effectively
executed.” –Theo Haimann
• “Organizing is a function by which the concern is able to define the role positions, the jobs
related and the coordination between authority and responsibility.” – Chester I. Barnard
• “Organizing is the process of defining and grouping the activities of the enterprise and
establishing the authority relationships among them.” – Luther Gulick
Importance of Organising
Following are the importance of organising:
1. Benefits of Specialization:
In an organization, work is divided into units and departments. This division of work leads to specialization
in various activities of the concern. The entire philosophy of the organization is based on the concept of
division of work into compact jobs. This leads to systematic allocation of jobs amongst staff, which
enhances productivity and reduces the workload. Division of work refers to assigning responsibility for
each organizational component to a specific individual or group. This, in turn leads to specialization,
efficiency and speed in job performance.
2. Clarity in a Working Relationship:
After identification of a job, organising also clarifies the authority and responsibility of individuals
of different departments. It is a means of creating coordination among different departments of
enterprises. It aims at creating clear-cut responsibility, and authority relationships amongst different levels
and ensuring cooperation amongst individuals and groups. Harmony of work is brought by the high level of
management. Every employee knows his superior from whom he has to take the order, and to whom he
has to report. This working relationship helps in fixing responsibility and helps to avoid confusion.
3. Optimum Utilization of Resources:
Organising ensures the optimum utilization of human and material resources. In organising, work is
assigned as per skill and knowledge. The clarity in the job in advance of what the employees are supposed
to do avoids confusion and motivates employees to put in their best.
4. Adaption to Change:
The process of organising allows an organization to accommodate changes in a business environment. So
the organization structure is suitably modified and the revision of the job position and relationships plan
the way for smooth transactions. Thus, organising provide flexibility and stability to an organization. It
helps an organization to survive and grow, despite people leaving and joining. It also helps to adapt to
changes in technology, new methods of work, etc.
5. Effective Administration:
Organising provides a clear description of the jobs and working relationships. It helps in effective
administration by avoiding confusion and duplication of work. Organising also reduces the workload of the
top management by delegating authority. As a result, top management is relieved from routine work and
can concentrate on the administration of the company.
6. Development of Personnel:
In the process of organising, a managerial person is trained to acquire a wide experience in diverse
activities through delegation of authority. Delegation allows manager to reduce their work by assigning
future jobs to subordinates. It also gives time to concentrate on important work. The delegation also
develops a sense of responsibility in the subordinates and motivates them to do more challenging work.
7. Expansion and Growth:
An organization’s growth is totally dependent on how efficiently and smoothly it works. The organising
process creates a favorable condition for expansion and diversification of enterprise by enabling it to
deviate from existing norms and take up a new challenge. Organising allows a business enterprise to
access more job positions and departments, and even diversifies its product lines. It helps in the expansion
and growth of the business.

Organizing Process
1] Identifying the Work
The obvious first step in the process of organizing is to identify the work that has to be done by the
organization. This is the ground level from which we will begin. So the manager needs to identify the work and
the tasks to be done to achieve the goals of the organization.
Identification of the work helps avoid miscommunication, overlapping of responsibilities and wastage of time
and effort.

2] Grouping of Work
For the sake of a smooth flow of work and smooth functioning of the organization, similar tasks and activities
should be grouped together. Hence we create departments within the company and divisions within each
department. Such an organization makes the functioning of the company way more systematic.
Depending on the size of the organization and the volume of work, an organization can have several
department and divisions. And every department has a manager representing them at the top-level of the
management.
In smaller organizations sometimes these departments are clubbed together under one manager.

3] Establish Hierarchy
The next step in the process of organizing is to establish the reporting relationships for all the individual
employees of the company. So a manager establishes the vertical and horizontal relationships of the
company.
This enables the evaluation and control over the performances of all the employees in a timely manner. So if
rectifications need to be made, they can be made immediately.

4] Delegation of Authority
Authority is basically the right an individual has to act according to his wishes and extract obedience from the
others. So when a manager is assigned certain duties and responsibilities, he must also be delegated authority
to carry out such duties effectively.
If we only assign the duties, but no authority he will not be able to perform the tasks and activities that are
necessary. So we must always assign authority and clearly specify the boundaries of the duties and the
authority which has been delegated.

5] Coordination
Finally, the manager must ensure that all activities carried out by various employees and groups are well
coordinated. Otherwise, it may lead to conflicts between employees, duplication of work and wastage of time
and efforts. He must ensure all the departments are carrying out their specialized tasks and there is harmony
in these activities. The ultimate aim is to ensure that the goal of the organization is fulfilled.
Organizational Structure
An organizational structure is a system that outlines how certain activities are directed to achieve the goals
of an organization. These activities can include rules, roles, and responsibilities.
The organizational structure also determines how information flows between levels within the company.
Decisions flow from the top down in a centralized structure. Decision-making power is distributed among
various levels of the organization in a decentralized structure. Having an organizational structure in place
allows companies to remain efficient and focused.
An organizational structure defines how tasks are delegated to achieve an organization's goals. It helps
clarify employees' roles and responsibilities within the company. Generally, employees with greater
authority are positioned higher in the organizational hierarchy. A well-organized structure enables a
company to operate more efficiently, facilitating effective communication and collaboration among team
members.
Organizational structures can be broadly categorized into centralized and decentralized models.Centralized
organizations feature:
• Hierarchical structure: Clear chain of command with defined roles and responsibilities.
• Centralized decision-making: Leadership holds primary authority for decision-making.
• Example: Military organizations.
Decentralized organizations feature:
• Distributed decision-making: Mid-level managers and employees have more input and influence.
• Increased autonomy: Teams have greater flexibility and independence.
• Adaptability: Can be more agile and responsive to change.
• Example: Many technology startups.
While centralized structures offer a clear chain of command and defined roles, decentralized structures can
promote innovation, collaboration, and adaptability. Understanding the strengths and weaknesses of each
model can help organizations choose the most suitable structure for their specific needs and goals.
 Types of Organization Structure

1. Line Organization

Line organization, also known as a scalar or military organization, is the simplest and
oldest form of organizational structure. It is characterised by a clear and direct chain
of command, where authority flows vertically from top to bottom. Each employee has
a single supervisor to whom they report, creating a clear line of responsibility and
accountability. Decision-making is typically centralised at the top of the hierarchy,
with limited delegation. This structure is suitable for small organizations with a
straightforward hierarchy, where decision-making needs to be efficient and
communication is direct. However, it can lead to delays in decision-making as all
decisions must pass through the hierarchy, and communication can be limited to the
immediate supervisor. No staff specialists are available in line organization and all
the persons at the same level are independent of each other.

2. Functional Organization
Functional organization is a common structure where departments are organised
based on specialised functions or tasks. For example, there might be separate
departments for marketing, finance, operations, human resources, and so on. Each
department is headed by a functional manager who has expertise in that particular
area. This structure allows for the efficient utilisation of specialised skills and
knowledge, as employees within each department can focus on their areas of
expertise. It also enables clear career paths within each function. Specialists operate
here with considerable independence. However, functional organizations can create
silos, where departments become inwardly focused, and communication and
collaboration between departments may be limited. Coordination across functions
can also be challenging.

3. Line and Staff Organization

In a line and staff organization structure, line positions focus on core operations,
while staff positions provide specialised support and guidance. Staff roles, like
human resources or legal, offer expertise and advice to line managers. This structure
balances operational responsibilities with specialised support, enabling better
decision-making and problem-solving. Specialists in such organizations have
advisory nature as they do not have the power of command over subordinates in
other departments. However, clarifying roles and coordination between line and
staff functions is important to avoid conflicts. This can also lead to confusion and can
be quite expensive for small firms.
 4. Matrix Organization

A hybrid grid structure wherein pure project organization is superimposed on a

functional structure is known as Matrix Organization. It combines elements of both
functional and project structures. It involves dual reporting lines, where employees
have both a functional manager and a project manager. The functional manager
oversees employees’ functional responsibilities, while the project manager manages
their involvement in specific projects. This structure allows for flexible resource
allocation, as employees can be assigned to different projects based on their skills
and availability. There is always a permanent functional setup and temporary cross-
functional teams are created to handle short-term projects, which are infrequent in
nature.
It also promotes effective sharing of expertise and knowledge across projects and
functional areas. Communication is typically multi-directional, as employees interact
with both their functional and project managers. However, a matrix organization can
be complex to manage, as employees have multiple reporting relationships, and
conflicts can arise due to competing priorities and demands from different managers.

5. Network Organization

A network organizational structure is a non-traditional business model that deviates

from the classic, hierarchical setup. Often referred to as a 'virtual organization', it is an
adaptable structure characterized by web-like interconnections and relationships
between the central organization and various independent entities or partners.

At the heart of this structure is the central organization that functions as the primary node,
around which a network of interconnected nodes or businesses revolve. The core
functions, the ones that provide the organization its unique competitive advantage, are
retained in-house. Meanwhile, non-core functions, which can range from product
 manufacturing, customer service, HR processes to digital marketing, are outsourced to
partners who specialize in these areas. This dynamic arrangement allows an
organization to be highly adaptable and resilient in ever-evolving markets.

The design and philosophy behind a network organizational structure draw heavily from
the principles of decentralization. Power and decision-making capabilities are not
confined to a single central authority but are distributed across the network, enhancing
overall operational efficiency and responsiveness.

7. Hybrid Organization

A hybrid organizational structure is a business model that incorporates elements from

different traditional organizational structures, typically combining aspects of both
functional and divisional arrangements.
The exact structure of a hybrid organization can vary significantly based on an
organization’s priorities and needs. Hybrid” means combining two different things. A
hybrid organizational structure combines elements of both traditional hierarchical and
modern flat structures, integrating functional, divisional, and matrix models. This
approach allows for flexibility, better resource allocation, and enhanced communication
across various departments and projects.
 Controlling

What is Controlling?

Controlling is regarded as one of the most important management functions. In fact,

without the presence of a control function, the entire management function will
become obsolete. The management will not be able to determine if the plan is working
properly or not, or if it is properly implemented or not.

The main objective of the control process is to make sure that the activities within an
organization are going as per the planning. Control process helps the managers in
determining the level of performance of their respective organizations.

Steps involved in Control Process

The following are the steps involved in the control process:

1. Establishing standards and methods or ways to measure performance

2. Measuring actual performance

3. Determining if the performance matches with the standard

4. Taking corrective action and re-evaluating the standard

Let us go ahead and discuss the above mentioned steps in detail.

Establishing performance standards: Although setting of goals and standards are

part of the planning process, it also plays an important role in controlling.

The main objective of controlling is to guide the business towards the desired target.
Therefore, if the employees or members of a business are well aware of the target, it
will result in more awareness about the target.

The managers must communicate the goals and objectives clearly to the employees
without any ambiguities. An organization in which everyone is working towards a
common objective has a better chance to grow and prosper.

Measuring actual performance against the set standards : The immediate action
that managers need to take after being made aware of the goals, is to measure their
actual performance and compare that with the standards already set. This helps in
identifying if the plan is actually working as was thought to be.

Once a plan is implemented, the task of managers is to monitor the plans and
evaluate. Managers must be ready with an alternative plan or suggest corrective
measures in case the plan is not going as was intended.
This can be done only when managers are measuring their actual performance. The
way performance can be evaluated is to measure it in monetary terms, hiring financial
experts.

This step of controlling is helpful in detecting future problems and issues and is
essential for taking decisions immediately so that the company is able to recover from
the losses.

Determining if the performance matches with the standard: Checking if the

performance matches with the standards is very important. It is an important step in
controlling. In this step, the results are measured with the already set standards.

Taking corrective action and re-evaluating the standard: Corrective measures need
to be taken when there is a discrepancy. Correct actions provide protection against
loss and stop them from reappearing in future.

Importance of controlling

Achieving organizational objectives: Controlling is implemented with the purpose of taking care of the
organizational objectives. Controlling detects any kind of deviation and accordingly corrective actions
are implemented.

This helps in reducing the gap between expected and actual results and in this way helps in achieving
the organizational objectives.

2. Coping with changes: An organization has to put up with many changes in the environment, which
can be emergence of new products and technologies, change in government regulations or changes in
strategies of the competitors.

3. Efficient use of resources: Controlling allows the manager in minimising the wastage of resources
and ensuring proper utilisation of the available resources that leads to effective performance by the
organization.

4. Determining the accuracy of standards: Managers always compare the work done with a set of
provided standards defined for the work and determine whether the set of standards are effective or
there is a need for improvement in the standards that will lead to more accurate determination of
process efficiency.

5. Helps in decision making: Controlling helps the managers in determining the gap between thinking
and actual implementation. It leads to better decision making and improves the overall performance of
the organization.
6. Motivates employees: In an organization employees are also aware that their performance is judged
using some set of standards.

Periodic and systematic evaluation of the employee performance and accordingly rewarding the
deserving employees in the form of bonus, increment or promotion leads to the employees getting more
motivated in order to perform for the organization.

7. Maintains discipline and order: Controlling brings about order and discipline in the regular
operations of the organization. Employees are also bound by the rules which reduces unprofessional
behavior in the organization.

8. Improves coordination: Controlling provides a common direction to all the activities of the
organization and also aligns employee action with organizational goals, thus ensuring optimum
performance.

Types of Control

There are five different types of control:

1. Feedback Control: This process involves collecting the information on which the task is being
finished, then assessing that information and improvising the same tasks in the future.

2. Concurrent control (also known as real-time control): It investigates and corrects any
problems before any losses arising. An example is a control chart.

This is the real-time control, which checks any problem and examines the same to take action before
any loss has been caused.

3. Predictive/ feedforward control: This type of control assists in the early detection of problems.
As a result, proactive efforts can be done to avoid a situation like this in the future. Predictive control
foresees the problem ahead of its occurrence.

4. Behavioral control: This is a direct assessment of managerial and staff decision-making rather
than the consequences of those decisions. Behavioral control, for example, sets incentives for a wide
range of criteria in a balanced scorecard.

5. Financial and non-financial controls: Financial controls refer to how a firm manages its costs
and spending to stay within budgetary limits. Non-financial controls refer to how a company manages
its costs and expenses to stay within budgetary constraints.
 Techniques of Controlling

There are a number of controlling techniques available for an organization. The techniques can
be classified under two major categories:

a. Traditional Techniques

b. Modern Techniques
Traditional Techniques of Controlling

i. Personal Observation

Personal observation is the oldest and most important controlling techniques. Under this
technique, managers or superiors personally visit the work place irregularly and observe the
performance of employees. They check if the work is going as per plans or not. If any
discrepancy is found, they give instructions on the spot immediately. Personal observation
technique results into first hand evaluation of work. But control through this technique is time
consuming and may not be applicable in all situations.

ii. Setting Examples

Managers set their own examples of good performance before their employees and expect the
same from them. For example if managers show their examples of punctuality before their
employees, they will also follow the same easily. Hence, the exemplary behaviour of managers
can control the behaviour and actions of their employees.

iii. Plans and Policies

The organizational plans, policies, procedures, strategies, rules etc. govern and control all the
activities of the organization. They play an important role in controlling activities and prevent
deviations and ensure the conformity of actions with plans and policies.

iv. Organization Charts and Manuals

Organization charts and manuals sets out organizational relationships, responsibilities and
duties of the employees of the organization. These documents are also used to control the
performance of employees and fixing responsibilities.

v. Disciplinary System

Disciplinary system comprising punishments, criticism, disciplinary actions etc. act as an

important tool of control. It acts as a negative control tool. Where employees commit mistakes
repeatedly and mistakes are crucial, strict disciplinary action is taken by the managers. This
technique of control should be used by managers carefully as it results into fear in the minds
of employees. It can cause reduced morale also.

vi. Statistical Data

Statistical data is also used as an important controlling technique. Data is collected and
presented in the form of tables, charts, figures, and graphs. Then it is analysed with the help
of various statistical techniques like measures of central tendency, measures of dispersion,
correlation, regression etc. to take certain decisions in the fields of production, quality,
inventory, sales etc.

vii. Written Instructions

Instructions in written form are issued by managers and superiors from time to time for the
subordinates. Instructions are issued in the form of notices, letters, circulars, bulletins, etc.
they provide information and instructions in the light of changing rules and situations. Written
instructions act as supplementary control techniques.

viii. Special Reports and Records

Special reports and records relating to different operations of the concern are also prepared
in addition to normal reports and records. Experts prepare these reports. For example, in case
of a serious problem in the organization, expert committee may be appointed by the
management to go into the depth of the problem and suggest the ways or means to solve the
problem. The investigation reports relating to a specific problem or area are the examples of
special reports and records.

ix. Operational Audit

Audit is an effective controlling tool. Operational audit refers to audit of internal operations of
the organization. The organization conduct internal audit with the help of some specialised
internal staff or may also hire the services of external audit team. Internal audit gives a review
of overall working of the organization. It depicts whether organizational policies, plans,
procedures etc. are being adopted by the employees in their day to day working or not. Thus
internal audit provides an internal check over the operations of the employees and hence
improve their efficiency.

x. Financial Statements

Financial statements comprise Profit and Loss account and Balance Sheet. These statements
show the true picture of the organization in the form of working and financial position of the
business. These statements also act as controlling technique. For example, the comparison and
analysis of statements of different time periods reveal the trends in performance and depict
the present position of the enterprise. This comparison and analysis can be used for controlling
the financial position of the concern.

xi. Break-Even Analysis

Break-Even analysis is a widely used technique of controlling. It is used to find out break-even
point where the total cost is equal to total revenue, i.e. the point of no loss no profit. This point
is used to identify the number of units of a product that must be sold to generate enough
revenue so as to cover costs. Any production above this point will yield profits. This technique
basically shows relationship between cost-volume-profit. With the help of this technique
managers examine the impact of increase or decrease of units sold and increase or decrease
in price or costs on the amounts of profits.
Every management tries to reach the break-even point as soon as possible. Sales over and
above this point depict the margin of safety or profit area. Hence, this chart is useful to know
relationship between revenue, cost and profit as it shows probable level of profits at different
levels of output.
 The limitation of breakeven analysis is that it takes into consideration only fixed and variable
costs. The impact of semi-variables costs is not taken into account. It also ignore impact of
other variables like marketing aspects, capital invested, etc. It also assumes fixed cost to
remain constant, but it doesn’t remain fixed in present scenario of changing technologies, size
of the firm and other factors.

xii. Cost Accounting and Cost Control

Cost accounting is a technique to determine the cost of a product, process, or a unit and cost
control. Cost control includes control over costs by using various techniques. One such
technique is standard costing. It includes determination of standard (or predetermined) costs.
Standard costs are determined in respect of total cost as a whole as well as for each element
of cost, i.e., material, labour and overheads. When actual costs are incurred, these are
compared with standard costs and variations, if any, are found. The standard costing involves
various steps which are explained as follows:

a) In first step of standard costing, standards or benchmarks for costs are fixed. Standards are
fixed for each element of total cost on the basis of past records or through experiments and
thorough analysis.

b) In second step, the actual cost is determined. The information is taken from cost accounting
records.

c) A comparison between standard costs and actual costs is done to find out any deviations
between the two. If there is no variation, or the variation is within prescribed and acceptable
limits, no further action is required.

d) If the deviation is beyond the acceptable limits, it is further analysed. The causes for such
variation are found and responsibility is fixed accordingly.

e) Future course of action is planned to avoid such deviation in future. It may also include
review and revision of standards.

Hence, standard costing is an important tool of controlling of costs and wastages in the hands
of managers.

xiii. Budgets and Budgetary Control

Budgets are used as a controlling technique by most of the organizations. A budget represents
a statement of expected results expressed in numerical terms. It is formed in advance for the
period to which it will apply. Budget serves as a benchmark against which the actual results
will be compared and the performance of the organization can be identified. Budgets make
management by exception possible. Budget is used as a technique of planning as well as
controlling. As a tool of planning, budget depicts the plans in numerical figures which are to
be achieved. As a tool of controlling, budget serves as a standard for measurement and
comparison of actual performance. It helps in delegation of authority and fixation of
responsibilities.

Budgeting is the process of making budgets. Budgets are prepared for various operations of
the organization, like, sales budget, production budget, financial budget, overheads budget,
personnel budget, etc.
 Budgetary control is a technique to use budgets for controlling activities. Budgetary control is
the process of establishing various budgets for different operations of the concern for the
future period, and then actual results are recorded. The actual figures are compared with the
budgeted one and discrepancies are found out and remedial actions are taken.

Objectives of Budgetary Control

Budgetary control is an important tool of planning as well as of controlling. The main objectives
of budgetary control are as follow:

a. To determine business policies for the achievement of desired objectives during a particular
period of time. It sets out definite targets of performance and also act as a guide to the actions
of others.

b. To help in co-ordination of activities and efforts of different departments.

c. To control the activities of the people to ensure the conformity of actual results with
budgeted results.

d. To operate various cost centres and departments efficiently.

e. To correct the deviations from the predetermined standards and also provide a basis for
revision of policies and plans.

Budgetary control helps organizations to enhance efficiency by controlling costs and wastages.
It increases efficiency of the organization. Hence, budgetary control is an important technique
in the hands of management.

Modern Techniques of Controlling

The modern techniques of controlling are as follows:

i. Return on Investment (ROI)

Return on Investment (ROI) is a controlling technique to control the overall performance of an

organization. ROI measures the rate of return on investment. Under this technique, profit is
considered in terms of capital employed. Following is the formula to calculate ROI:

ROI = Net Profit / Total Investment

ROI is used to evaluate the efficiency of an investment. The managers can compare ROI
between two or more periods of the organization or of the two or more other organizations to
draw certain conclusions regarding the efficiency. Higher ROI reflects higher performance as
compared to concerns with lower ROI. However, while doing comparisons over period, it
should be considered that value of money differs in different periods. Hence, time value of
money can be incorporated. Secondly, while comparing with other organizations, the terms
used in ROI i.e. what components are included in profits and investments and in which units.
On the basis of such calculations, mangers control the activities of their own organization.

ii. Management Audit

Management audit evaluates the performance of various management functions and
processes. This audit intends to examine and review the management policies and actions on
the basis of certain objective standards. It is a comprehensive audit which reviews all the
aspects of management. Management audit is a systematic and independent review activity
within an organization which appraises the operations of all the departments. The objective of
management audit is to help all managerial levels to perform their responsibilities effectively
by providing them objective analyses, appraisals, recommendations regarding the activities
reviewed. Management audit usually contains the following steps:

a. The first step of management audit is to identify the objectives of the organization.
Objectives of organization should be clearly defined.

b. The overall objectives of the organization are divided into various targets and plans for
various segments.

c. The organizational structure is also evaluated to check whether it can achieve the overall
objectives and targets effectively. The managers also identify each functional area as a
responsibility centre.

d. The performance of each responsibility centre is examined. It is compared with the

objectives and targets.

e. Pragmatic course of action is suggested on the basis of above examination. Motivation

system is also devised to provide incentives to various personnel as per the results of
management audit.

Management audit is result oriented. Management audit helps to assess the performance or
progress of various mangers and accordingly, a suitable incentive system can also be linked to
it. The performance is evaluated by relating inputs like man-hours, materials, wages etc. with
outputs like quantity, return etc. Hence, the thrust of management audit is on results. The
management audit acts as an important tool of management control if undertaken properly.
Following techniques can be used for conducting management audit:

a. Inquiry: Management auditor prepares a questionnaire containing relevant questions for

obtaining relevant evidences. Relevant questions may be asked in such a way as to provide
answers to a hidden problem.

b. Examination: in many situations, the management auditor examines records and

documents. The need may arise to cross check the documents along with information obtained
from inquiry.

c. Confirmation: Management auditor may get written or oral information from various
persons to confirm the information acquired by him.

d. Personal Observation: in many cases, management auditor may have to go for personal
observation of various activities and situations in the organization.

e. Correlation of Information: the information collected from various techniques has to be

correlated so as to draw conclusions.

iii. Management Information System (MIS)

In present age of information technology, Management Information System or MIS is an
important technique for providing quick information to the management. MIS provides all
necessary information to the managers and superiors at different levels to help them to
discharge their functions like planning, organizing, decision making and controlling properly.
MIS is a scientific way of collecting, organizing, processing, and storing and communicating
information to various levels of management so that decisions can be taken by the managers
in time. MIS helps in increasing efficiency of the organization by providing timely, accurate
and relevant information for doing various operations of the organization.

The importance of having an effective MIS also lies in the presence of changing economic,
political, social and technological conditions. Timely information helps the organizations to
take advantages of various opportunities available outside and to overcome threats by taking
proper actions in time. MIS also provides internal information relating to various activities and
also shows the manner of utilization of resources in the organization. It shows the performance
of various resources. The information relating to idle time, labour turnover, wastages etc. can
also help the managers to control various costs. In present information scenario, it is very
important to have an effective management information system in the organization. It will be
very difficult to manage and control the operations without an effective MIS.

iv. Zero Base Budgeting (ZBB)

Zero base budgeting or ZBB is a new approach of budgeting. It is used as a control technique.
Under ZBB, in determination of budgets, information or figures of previous periods is not taken
into account. Budgets are prepared afresh without considering the information from previous
years or periods. Budgets are prepared in the light of current situations.

ZBB starts with a base taken as zero. In this technique, all activities are analyzed in terms of
their needs and costs. In the budget, every expense has to be justified in the presence of
prevailing conditions. Unlike conventional budgeting, where previous year inefficiencies can
enter, zero base budget starts from scratch and is prepared every time. Following are the steps
involved in the process of zero base budgeting:

a. Determination of the objective of budgeting: the first step of ZBB is to determine the
objective of budgeting very clearly. Objective may be to reduce cost, it may be accomplished
by cutting down salaries, or by dropping an unprofitable product or project. Hence, objective
of budgeting should be clearly defined at the first instance.

b. Determination of Scope of application: scope of application of ZBB is decided. ZBB can be

applied to whole organization or to some specific areas.

c. Development of Decision Units and Decision Packages: in next step, decision units are
developed and for each decision unit, decision packages are determined. A decision unit is that
for which cost benefit analysis can be done so as to arrive at a decision regarding continuing
or discontinuing any particular unit. A decision package involves ranking of all activities in
order of their importance based on cost benefit analysis.

d. Allocation of resources: finally, resources are allocated according to ranking of decision

packages to have optimum results.
Ranking of projects on the basis of cost benefit analysis help the management to eliminate the
unnecessary expenditures. Hence, management uses ZBB as a controlling technique to achieve
organizational objectives in an efficient manner.

v. PERT/CPM

The project management techniques, PERT (Programme Evaluation and Review Technique)
and CPM (Critical Path Method) are useful for managerial functions like planning, scheduling
and controlling. These techniques help the mangers in completing the projects on schedule.
Presently, organizations are involved in various projects which are very large in size and take
more time. Companies make use of these networking techniques to schedule the complex
projects which involve many activities. Though the two techniques differ slightly, but both are
based on same principles.

PERT/CPM is a tool used to plan, schedule and control large projects consisting of a number
of independent activities and with uncertain completion time. In this technique, a network
diagram is prepared that shows the sequence of activities needed to complete a project and
time and cost associated with each activity. Hence the purpose is to identify critical activities
which are essential to perform and complete the project and to identify the time (least possible)
and cost associated with each activity. Thus, these techniques not only help in planning but
also help managers to monitor and control the progress of the project, find out any obstacles
and provide proper resources to complete the project as per schedule. The major limitation of
PERT and CPM technique is that they can not be effectively applied in manufacturing
operations as the main focus of these techniques is on time and not on quality which is a key
factor in manufacturing.
Change Management
Change management is a systematic approach to dealing with the transition or transformation of an
organization's goals, processes and technologies. The purpose of change management is to implement
strategies for effecting and controlling change and helping people to adapt to change.
Change management is defined as the methods and manners in which a company describes and implements
change within both its internal and external processes.
Change control experts should pay particular attention to include the following concerns:

• Scope. A change request could affect the project scope.

• Schedule. A change request could alter the project schedule.

• Costs. Labor is typically the largest project expense and changes that increase time to
complete also raise project costs.

• Quality. Change requests might affect the quality of the completed project. For example,
accelerating the project schedule can affect quality when work is rushed.

• Human resources. A change request might entail bringing on additional or specialized labor.
Also, when the schedule changes, key resources might be moved to other assignments.

• Communications. Change management is interactive. Approved change requests must be

communicated to the appropriate stakeholders at the right time.

• Risk. Change requests must be evaluated to consider risks they pose. Even minor changes can
have a domino effect on the project and introduce logistical, financial or security risks.

• Procurement. Changes to the project can affect when, where and how materials and contract
labor are procured.

Types of organizational change

Change management can be used to manage many types of organizational change. The three most
common types are the following:

• Developmental change. Any organizational change that improves previously established

processes and procedures.

• Transitional change. Change that moves an organization away from its current state to a new
state to solve a problem, such as implementing a merger and acquisition or automating a task
or process.

• Transformational change. Change that radically and fundamentally alters the culture and
operation of an organization. The result of transformational change might not be known ahead of
time. For example, a company may pursue entirely different products or markets.
 5 STEPS IN THE CHANGE MANAGEMENT PROCESS

1. Prepare the Organization for Change

For an organization to successfully pursue and implement change, it must be prepared both
logistically and culturally. Before delving into logistics, cultural preparation must first take place to
achieve the best business outcome.

In the preparation phase, the manager is focused on helping employees recognize and understand
the need for change. They raise awareness of the various challenges or problems facing the
organization that are acting as forces of change and generating dissatisfaction with the status quo.
Gaining this initial buy-in from employees who will help implement the change can remove friction
and resistance later on.

2. Craft a Vision and Plan for Change

Once the organization is ready to embrace change, managers must develop a thorough, realistic,
and strategic plan for bringing it about.

The plan should detail:

• Strategic goals: What goals does this change help the organization work toward?
• Key performance indicators: How will success be measured? What metrics need to be moved?
What’s the baseline for how things currently stand?
• Project stakeholders and team: Who will oversee the task of implementing change? Who needs
to sign off at each critical stage? Who will be responsible for implementation?
• Project scope: What discrete steps and actions will the project include? What falls outside of the
project scope?
While it’s important to have a structured approach, the plan should also account for any unknowns or
roadblocks that could arise during the implementation process and would require agility and flexibility to
overcome.

3. Implement the Changes

After the plan has been created, all that remains is to follow the steps outlined within it to implement the
required change. Whether that involves changes to the company’s structure, strategy, systems, processes,
employee behaviors, or other aspects will depend on the specifics of the initiative.

During the implementation process, change managers must be focused on empowering their employees to
take the necessary steps to achieve the goals of the initiative and celebrate any short-term wins. They
should also do their best to anticipate roadblocks and prevent, remove, or mitigate them once identified.
Repeated communication of the organization’s vision is critical throughout the implementation process to
remind team members why change is being pursued.

4. Embed Changes Within Company Culture and Practices

Once the change initiative has been completed, change managers must prevent a reversion to the prior
state or status quo. This is particularly important for organizational change related to business processes
such as workflows, culture, and strategy formulation. Without an adequate plan, employees may backslide
into the “old way” of doing things, particularly during the transitory period.
By embedding changes within the company’s culture and practices, it becomes more difficult for
backsliding to occur. New organizational structures, controls, and reward systems should all be considered
as tools to help change stick.

5. Review Progress and Analyze Results

Just because a change initiative is complete doesn’t mean it was successful. Conducting analysis and
review, or a “project post mortem,” can help business leaders understand whether a change initiative was a
success, failure, or mixed result. It can also offer valuable insights and lessons that can be leveraged in
future change efforts.

Ask yourself questions like: Were project goals met? If yes, can this success be replicated elsewhere? If
not, what went wrong?

Quality Management
Quality management is a system that ensures a product or service consistently meets or exceeds customer
expectations. It involves a structured approach to planning, implementing, and controlling processes to achieve and
maintain a desired level of excellence.

Key aspects of quality management include:

• Quality Planning: Defining quality objectives and establishing how to meet them.

• Quality Assurance: Monitoring systems to identify areas for improvement and ensure specified
requirements are met.

• Quality Control: Verifying that products or services conform to established standards.

• Quality Improvement: Implementing changes based on feedback and analysis to enhance processes and
outcomes.

Benefits of quality management:

• Improved Customer Satisfaction:

Meeting or exceeding customer expectations leads to increased satisfaction and loyalty.

• Enhanced Reputation:

Consistently delivering high-quality products and services builds a positive brand image and trust.

• Increased Efficiency:

Streamlined processes and reduced errors lead to improved productivity and cost savings.

• Competitive Advantage:

Superior quality can differentiate a business from its competitors and attract customers.

Quality Management Tools and Techniques:

• ISO 9001: A widely recognized international standard for quality management systems.

• Six Sigma: A data-driven approach to reduce defects and improve processes.

• Total Quality Management (TQM): A comprehensive management approach that involves all employees in
quality improvement efforts.
 • Quality Function Deployment (QFD): A method for translating customer needs into product or service
design.

• 7 Basic Quality Tools: Techniques like check sheets, Pareto charts, and control charts to analyze and improve
quality.

By implementing a robust quality management system, organizations can achieve operational excellence, enhance
their competitive position, and build a strong foundation for long-term success.
Innovation and Disruption
Innovation
Definition:
Innovation refers to the process of developing new ideas, products, services, processes, or models
that add value or improve upon existing solutions.
Types of Innovation:
• Product Innovation: Creating new or improved goods (e.g., smartphones, electric cars).
• Process Innovation: Enhancing how a product or service is created or delivered (e.g.,
automation in manufacturing).
• Business Model Innovation: Changing how a company creates, delivers, and captures
value (e.g., subscription models).
• Organizational Innovation: New ways of managing teams, resources, or operations (e.g.,
remote working systems).
Examples:
• Apple’s iPhone introduced a new way to use mobile devices.
• Tesla innovated by combining electric vehicles with software-driven features.

Disruption
Definition:
Disruption occurs when innovation drastically alters or displaces existing markets, products, or
services, often rendering traditional methods obsolete.
Disruptive Innovation:
A term popularized by Clayton Christensen, it describes innovations that start at the bottom of a
market and eventually displace established leaders.
Examples:
• Netflix vs. Blockbuster: Netflix disrupted traditional video rental services.
• Uber vs. Taxis: Uber changed the transportation industry through app-based ride-hailing.
• Digital Cameras vs. Film Cameras: Digital photography disrupted Kodak’s film business.

Key Differences Between Innovation and Disruption:

Feature Innovation Disruption
Scope Improvement or new addition Market-shaking or business model change
Impact Can be small or large Often massive and industry-wide
Feature Innovation Disruption
Goal Solve problems or increase efficiency Replace old systems with new ones
Examples Better battery life in phones Smartphones replacing traditional phones

Why They Matter:

• For Businesses: Staying innovative is essential to remain competitive. Disruption forces
companies to adapt or risk failure.
• For Society: Drives progress, improves quality of life, and reshapes job markets.
• For Policy and Education: Requires adaptive regulations, curriculum reforms, and
workforce reskilling.