Nature of management

Dr.V.RAVI
Associate Professor and Head
Department of Humanites
Indian Institute of Space Science and Technology 1
 Features of management
Organized activities
Existence of objectives
Relationship among resources.
Working with and through people.
Decision making.

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Management and Administration: A terminological
conflict

Both of these terms were often used interchangeably during

initial stages of development of management thought.
Oliver Sheldon initially raised the terminological conflict
between these two terms in his seminal book, ‘The
Philosophy of Management’.
He viewed administration primarily as a decision making
function and management as an execution function.
Distinctions between these two terms were subsequently
raised by various researchers, which have led to emergence
of three approaches:

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Emergence of three approaches
1. Administration is above management: Many classical management
thinkers viewed administration as above management. They viewed
administration as related to policy formulation and management as
related to policy execution.
2. Administration is a part of management: Management thinkers of
this thought viewed management as a more comprehensive function
that also includes administration. Prominent management thinker in
this school of thought was Brench.
3. Management and Administration are the same: Management
thinkers of this view viewed no difference between management and
administration. They saw both management and administration
involving same functions, principles and objectives.

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 Difference between management
and administration
Basis of difference Administration Management

Level in organization Top level Middle and lower level

Major focus Policy formulation and Policy execution for
objective determination objective achievement

Nature of functions Determinative Executive

Scope of functions Broad and conceptual Narrow and operational
Factors affecting decisions Mostly external Mostly internal
Employer-employee Entrepreneurs and owners Employers
relations

Qualities required Administrative Technical

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 Management: Art or science
Before industrial engineering became as a
profession, there were no trained professional
managers.
Intuition, commonsense and experience were
considered essential in a person to manage affairs
of an enterprise.
In science, a person learns ‘why’ of a phenomenon,
whereas in art he learns ‘how’ of it.
Considering the generality of management, a
debate arose among researchers with respect to
nature of management.
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 Management as science
Science has many disciplines. Management as a discipline has
attempted to provide their own set of principles, laws and theories
using knowledge from all these fields.
The terms of reference and procedures involved in their measurement
needs to be clearly specified in science. This is not in case of
management.
Scientific theories are testable and permit empirical confirmation. In
addition, scientific theories and laws repeatedly give same results all
the time when they are tested. This does not hold true in case of
management principles.

Management is not a pure science and is considered as ‘inexact

science’ or ‘pseudo-science’

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 Management as art
Disciplines of art requires use of know-how skills. Besides,
constant practice is needed for achieving the desired
results. Diverse skills and constant practice as in art are
required by managers to be successful in business
environment.
Creativity is essential in fields of art to be successful.
Similarly creative skills and talents come in handy for a
manager to take efficient decisions.
Process of management is personalized, meaning that there
is ‘no best way of managing’. For example, success of
managerial activities may be related with personality of a
person.
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 Universality of management

The extent to which managerial knowledge

developed in one country can be transmitted
and used in other countries is answered by
the concept of universality of management.
This has led to two approaches
Arguments for universality of management
Arguments against universality of management

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 Arguments for universality
Management as processes:
Functions of management as planning, organizing, staffing, directing and controlling are
needed for every organization irrespective of the country, culture or size, etc. These thinkers
argue that any theory on management processes could universally be applied to all
organizations.
Management fundamentals and management techniques:
Proper distinction is to be made between management fundamentals and management
techniques for argument related to universality of management. Management fundamentals are
basic principles and theories on which, an organization works. Tools available to managers for
performing managerial functions are referred to as management techniques. Specific
management techniques may differ from country to country or as per the situation, while
management fundamentals remain the same.
Management fundamentals and practices:
Process of management requires concepts of art and science. Science and art are
complementary. Management thinkers who argue for universality of management suggest that
although management fundamentals remain the same, practice of them may differ according to
nature of organizations.

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Arguments against universality
Cultural characteristics:
Cultural characteristics significantly differ from one country to another and
the same holds good for principles of management as well. Management is
culture bound and application of management principles are determined
by culture prevailing in that particular place.
Management philosophy:
Management thinkers of this school of thought argue that every
organization has unique philosophy of doing business and thus different
organizations require different kinds of management approaches.
Organizational objectives:
Objectives of an enterprise determine the type of management required.
Business organizations exist for economic ends and management consists
of skills and techniques for attaining these ends.

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People vary on five dimensions of
national culture
Individualism and collectivism
Power distance
Uncertainty
Masculinity
Time orientation

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Frank and Lillian Gilbreth

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Therbligs

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 Fayol’s administrative
management
Fayol’s contributions were first published in a
book form titled ‘Administration Industrielle at
Generale’’ in French Language in 1916.
Generale
He looked at problems of managing an
organization from the top management point of
view.
He preferred to use the term administration
instead of management emphasizing that there is
unity of science of administration.

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Fayol’s administrative management
Activities in an industrial management
Technical (related to production)
Commercial (related to buying, selling and exchange)
Financial (search for capital and optimum use).
Security (protection of property and person)
Accounting (including statistics)
Managerial (planning, organization, command, coordination and control).
Managerial qualities and training
Physical (health, vigour
vigour,, and address)
Mental (ability to understand and learn, judgement
judgement))
Moral (energy, firmness, initiative, loyalty, tact and dignity)
Educational (general acquaintance with matters not belonging exclusively
to the function performed).
* Technical ( peculiar to the function being performed) and
Experience (arising from the work).

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 General principles of
management
Management principle is a fundamental truth and
establishes cause-
cause-effect relationship.
He made 14 principles of management and has
emphasized two things:
The list of management principles is not exhaustive but
suggestive and has discussed only those principles
which he followed on most occasions.
Principles of management are not rigid but flexible.

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Fayol’s principles of management
1. Division of work.
2. Authority and responsibility
3. Discipline
4. Unity of command
5. Unity of direction
6. Subordination of individual interest to
general interest.
7. Remuneration of personnel
8. Centralization.
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Fayol’s principles of management
9. Scalar chain
10. order
11. equity
12. stability of tenure
13. Initiative
14. Esperit de Corps

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Bureaucratic type of organization
Bureaucracy style of management was propounded
by Max Weber, a German sociologist
three types of power in organization: traditional,
charismatic and bureaucratic.
He was of the view that bureaucratic type of power
was the ideal one.
Characteristic of bureaucratic organizations is that
here the authority is based on position rather than
the people who occupy them.
A bureaucratic organization has high complexity,
high formalization and high centralization.
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Bureaucratic type of organization
By complexity we mean how much
differentiation like division of labour,
departmentation, number of levels in
organization hierarchy, etc, exists in the
organization.
Formalization refers the degree to which
organization relies on rules and procedures
to direct the behavior of its employees.
Centralization considers where the focus of
decision-making authority lies.
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Bureaucratic type of organization
Division of labour: Each person’s job is broken
down into simple, routine and well-defined tasks.
Well-defined authority hierarchy: A multilevel
hierarchical formal organization structure with well
defined authority exists in a bureaucratic
organization with each of lower offices under the
control and supervision of a higher one.
Formal guides to behavior: Formal policies, rules
and procedures are followed to ensure uniformity
and to regulate the behavior of people in the
organization.
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Bureaucratic type of organization
Impersonal nature: one of the important
characteristic of this organization’s structure
is its impersonal nature where decisions are
governed by rational factors than personal
factors.
Employee decisions based on merit:
selection and promotion of employees are
based on education, experience and other
qualifications of the candidates.
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 Authority and Power
Legitimate power
Reward power
Coercive power
Expert power
Referent power

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THANK YOU

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