Management process

Management defined:“Management is an art of getting things done through and with the people in formally organized groups.
It is an art of creating an environment in which people can perform and individuals can cooperate towards attainment of
group goals”. Harold Koontz“Management is an art of knowing what to do, when to do and see that it is done in the best and
cheapest way”. F.W. Taylor
.
“Management is a distinct process consisting of planning, organizing, actuating and controlling, performed to determine and
accomplish stated objective by the use of human beings and other resources”. George R. Terry

Management as a Process
1. Management is a social process - concerned with developing relationship among people
2. Management is an integrated process - undertakes the job of bringing together human physical and financial resources so
as to achieve organizational purpose
3. Management is a continuous process - concerned with constantly identifying the problem and solving them by taking
adequate steps
4. Management is an iterative process- All

Management functions George Terry, “There are four fundamental functions of management i.e. planning, organizing,
actuating and controlling” Henry Fayol, “To manage is to forecast and plan, to organize, to command, & to control”
Koontz and O’Donnel - Planning, Organizing, Staffing, Directing and Controlling

Management functions:POSDCoRB Luther Gullick coined the keyword ’POSDCORB’ which formulates the responsibility
of a chief executive or administrator. It is developed as a means to structure and analyze management activities and sets a new
paradigm in Public Administration.

Management Function:Planning
GULLICK, “Planning is working out in broad outline the things that need to be done and the methods for doing them to
accomplish the purpose set for the enterprise.”KOONTZ, “Planning is deciding in advance - what to do, when to do & how to
do. It bridges the gap from where we are & where we want to be”.

3 basic steps in planning Formulating objectives – states precisely what results are to be accomplished and when Taking
action – follows predetermined plans of actions to fulfill the objective Analyzing results – measures the results achieved
against the

Management Function: Organizing Organizing – the establishment of a formal structure of authority through which the work
subdivisions are arranged, defined, and coordinated for the defined objective. In organizing, structures are created,
relationships are established and resources are allocated for the accomplishment of activities.According to Henry Fayol, “To
organize a business is to provide it with everything useful or its functioning i.e. raw material, tools, capital and personnel’s”

Organizing as a process involves

1. Identification of activities.
2. Classification of grouping of activities.
3. Assignment of duties.
4. Delegation of authority and creation of responsibility.
5. Coordinating authority and responsibility relationships.

Management Function:

Staffing – the whole personnel action of bringing in and training the staff and maintaining favorable conditions of work. It is
also known as Human Resource Management.Koontz & O’ Donell, “Managerial function of staffing involves manning the
organization structure through proper and effective selection, appraisal & development of personnel to fill the roles designed
into the structure”.

Staffing involves:◦ Manpower Planning◦ Recruitment, selection & placement.◦ Training & development.◦ Remuneration.◦
Performance appraisal.◦ Promotions & transfer.

Management Function:Directing
Directing is a part of managerial function which actuates the organizational methods to work efficiently for achievement of
organizational purposes.It is considered life-spark of the enterprise which sets in motion the action of people because
planning, organizing and staffing are the mere preparations for doing the work.It involves guiding and motivating other
people to work for a common
Elements of Directing Supervision - implies overseeing the work of subordinates by their superiors
Motivation - inspiring, stimulating, or encouraging the subordinates with zeal to work.
Leadership – the process by which manager guides and influences the work of subordinates in desired direction
Communication - process of passing information, experience, opinion from one person to another

MANAGERIAL LEVELS AND SKILLS

Level of Managers in an Organization:

Top Managers

Middle Mangers

First-Line Managers

Non-managerial Employees

First-line managers

(or first-line supervisors) are those managers having the least authority and are at

the lowest level in the hierarchy of the organization. First-line managers are at the lowest level of

management and manage the work of non-managerial individuals who are involved with the production or

creation of the organization's products. They're often called supervisors but may also be called line

managers, office managers, or even foremen. They are directly responsible for the work of operating (non-

managerial) employees.

a.Titles often include the term, "supervisor."

b.Factors changing the jobs of first-line managers include emphasis upon worker participation and teamwork

and the use of computers to regulate many activities formerly regulated by first-line managers.

c.The jobs of first-line managers are likely to change toward a greater emphasis on dealing with internal human relations.

Middle-level managers are those managers beneath the top-levels of the hierarchy and directly supervise

other managers below them. It includes all levels of management between the first-line level and the top

level of the organization. These managers manage the work of first-line managers and may have titles such

as department head, project leader, plant managers, or division manager.

a. Typical titles include "manager," "director of," "chief," department head," and "division head."

b. Middle managers are mainly responsible for implementing overall organizational plans so that
organizational goals are achieved as expected.

c. They plan, allocate resources to meet objectives and coordinate and link groups, departments,
and divisions within a company.

d. They monitor and manage the performance of the sub units and individual managers who report to them.
e. Implement changes or strategies generated by top managers.

f. The modern trend of adding layers of middle management is reversing as companies reduce the number of levels in
the managerial hierarchy.

G. Reducing the number of levels of managers' results in greater power and responsibility for those managers who remain.

I. It is predicted that there will be increasingly less emphasis on hierarchical levels in organization.

Top managers

are those managers at the very top levels of the hierarchy who have the most authority and

who are ultimately responsible for the entire organization. They are those who are responsible for making

organization-wide decisions and establishing the plans and goals that affect the entire organization. These

individuals typically have titles such as executive vice president, president, managing director, chief

operating officer, chief executive officer, or chairman of the board.

a. Other titles include "chief executive officer (CEO)," "president," "executive vice president,"
"executive director," "senior vice president," and sometimes, "vice president."

b. They oversee overall planning for the organization, work with middle managers in
implementing and planning, and maintain overall control over the progress of the

organization.

c. In those public corporation that sell their stock to the public, top managers' report to the
board of directors whose function is to represent the interests of the stockholders.

d. They are responsible for the overall direction of the organization and for creating the
context for change.

Time and Human relationships in Decision making

Decision making – identifying and selecting a course of action to deal with a specific problem or take advantages of an
opportunity is an important pat of every manager’s job. We all make decisions of course. What sets the practice of
management apart is the systematic, specialized attention that managers give to decision making.

We will describe the traditional process of decision making, the factors that go into decision making and some of the
difficulties that can arise in selecting a course of organizational action. We will conclude with an overview of two
emerging approaches to decision making game theory and chaos theory.

Time and human relationships are crucial elements in the process of making decision. Decision making connects the
organization’s present circumstances to actions that will take the organization into the future. Decision making also
draws on the past; past experiences positive and negative play a big part in determining which choices managers see as
feasible or desirable. Objectives of the future are thus based in part of past experiences. For instances declining sales of
Nike products helped turn managers’ attention to basketball and Michael Jordan.
In some cultures, human relationships take on even more importance in deciding about business dealings than they do
in the United States. For example, the Chinese believe that even the most comprehensive plan will always involve
unforeseen problems. To solve these one must rely on a network of relationships. Therefore, the Chinese are more
interested in a long standing and sincere commitment to working together than in apparently perfect contracts that
appear to contain no loopholes. The Chinese believe that a signed contract marks the end of the first stage in business
dealings, not a final agreement. With his or her signature, a signatory to any contract automatically establishes himself
or herself as a friend with a responsibility to help maintain a win-win agreement if difficulties arise. It is considered not
only a business necessity but also a matter of reputation and face.

The Nature of Decision Making

Making effective decisions, as well as recognizing whena bad decision has been made and quickly responding
tomistakes, is a key ingredient in organizationaleffectiveness.Some experts believe that decision making is the
mostbasic and fundamental of all managerial activities.Decision making is most closely linked with the
Planningfunction.However, it is also part of Organizing, Leading andControlling.

Decision making is the act of choosing one alternative from among a set of alternatives.• We have to first decide that a
decision has to be made and then secondly identify a set of feasible alternatives before we select one.

Decision-Making Process• Decision-Making Process includes: • recognizing and defining the nature of a decision
situation • identifying alternatives • choosing the ‘best’ [most effective] alternative and • putting it into practice.

Decision-Making Process (continued) Sometimes effective decisions must be made to: • Optimize some set of factors
such as profits, sales, employee welfare and market share or • Minimize loss, expenses or employee turnover or • Select
best method for going out of business, laying off employees, or terminating a strategic alliance.

Decision-Making Process (continued) Managers make decisions about both problems (undesirable situations) and
opportunities (desirable situations). Cutting costs by 10% Learning that the company has earned higher-than-projected
profits It may take a long time before a manager can know for sure if the right decision was made.

Types of Decisions•

Programmed decision is one that is fairly structured or recurs with some frequency (or both).•
Non-programmed decision is one that is unstructured and occurs much less often than a programmed decision.

Programmed Decisions Many decisions regarding basic operating systems and procedures and standard
organizational transactions fall into this category. McDonald’s employees are trained to make the Big Mac according to
specific procedures. Starbucks, and many other organizations, use programmed decisions to purchase new supplies
[coffee beans, cups and napkins].

Non-programmed Decisions
Most of the decisions made bytop managers involving strategyand organization design arenonprogrammed. Decisions
about mergers, acquisitions and takeovers, new facilities, new products, labor contracts and legal issues are
nonprogrammed decisions.Managers faced withnonprogrammed decisions musttreat each one as unique,investing great
amounts of time,energy and resources intoexploring the situation from allviews.Intuition and experience aremajor
factors in these decisions.

The Importance of Planning in an Organization

Planning helps an organization chart a course for the achievement of its goals. The process begins with reviewing the current
operations of the organization and identifying what needs to be improved operationally in the upcoming year. From there,
planning involves envisioning the results the organization wants to achieve, and determining the steps necessary to arrive at
the intended destination – success, whether that is measured in financial terms, or goals that include being the highest-rated
organization in customer satisfaction.

Efficient Use of Resources

All organizations, large and small, have limited resources. The planning process provides the information top management
needs to make effective decisions about how to allocate the resources in a way that will enable the organization to reach its
objectives. Productivity is maximized and resources are not wasted on projects with little chance of success.

Strategic versus Operational Planning

The process of developing a mission and long-range objectives and determining in advance how they will be
accomplished.
Strategic planning is a formal process for establishing goals and objectives over the long run. Strategic planning
involves developing a mission statement that captures why the organization exists and plans for how the organization
will thrive in the future. Strategic objectives and corresponding goals are developed based on a very thorough
assessment of the organization and the external environment. Finally, strategic plans are implemented by developing an
operational /operating or action plan.
Strategic planning vs. operational planning
Are they the same? If not, what’s the difference? Do you need both? We hear these kinds of questions frequently. In
short:
A strategic plan outlines your mission, vision, and high-level goals for the next three to five years. It also takes into
account how you’ll measure those goals, and the major projects you’ll take on to meet them.
An operational plan (also known as a work plan) is an outline of what your department will focus on for the near
future—usually the upcoming year.
Simply put, your strategic plan shares your vision for the future, while your operational plan lays out how you’ll get
there on a daily to weekly basis.
Both concepts describe your company's plans for the future, but in different contexts. Below we've called out five
major differences between them that you can use as guideposts to ensure you're using these two concepts the right
way.
Strategic Planning Vs. Operational Planning: The 5 Main Differences
1. Time Period

Your strategic plan outlines long-term goals for the next three to five years. What you’ll be doing to achieve
those goals in the shorter term (typically the next fiscal year) is outlined in your operational plan.
2. Goal Focus
The goal of your strategic plan is to outline the company’s long-term vision and how all departments should work
together to achieve it.
The goal of your operational plan isn’t company-focused—it is department-focused. There can be overlap between
departments, but that’s the exception rather than the rule. Large departments may require multiple operational plans.
3. Plan Generation
Your organization’s high-level leadership team—the executive team or city council, for instance—is responsible for
creating the strategic plan. Once it’s created, the strategic plan will be pushed forward by cross-functional teams who
work together to ensure the strategy is successful.

The strategic management process means defining the organization’s strategy. It is also defined as the process by
which managers make a choice of a set of strategies for the organization that will enable it to achieve better
performance.

Strategic management is a continuous process that appraises the business and industries in which the organization is
involved; appraises it’s competitors; and fixes goals to meet all the present and future competitor’s and then
reassesses each strategy.

Strategic management process has following four steps:

1. Environmental Scanning- Environmental scanning refers to a process of collecting,

scrutinizing and providing information for strategic purposes. It helps in analyzing the
internal and external factors influencing an organization. After executing the environmental
analysis process, management should evaluate it on a continuous basis and strive to improve
it.
2.
3.
4. Strategy Formulation- Strategy formulation is the process of deciding best course of action
for accomplishing organizational objectives and hence achieving organizational purpose.
After conducting environment scanning, managers formulate corporate, business and
functional strategies.
5.
6.
7. Strategy Implementation- Strategy implementation implies making the strategy work as
intended or putting the organization’s chosen strategy into action. Strategy implementation
includes designing the organization’s structure, distributing resources, developing decision
making process, and managing human resources.
8.
9.
10. Strategy Evaluation- Strategy evaluation is the final step of strategy management process. The key
strategy evaluation activities are: appraising internal and external factors that are the root of present
strategies, measuring performance, and taking remedial / corrective actions. Evaluation makes sure
that the organizational strategy as well as it’s implementation meets the organizational objectives.
11.

These components are steps that are carried, in chronological order, when creating a new strategic management plan.
Present businesses that have already created a strategic management plan will revert to these steps as per the
situation’s requirement, so as to make essential changes.

Components of Strategic Management Process

Strategic management is an ongoing process. Therefore, it must be realized that each component interacts with the
other components and that this interaction often happens in chorus.

The Three Levels of Strategy

Strategy is at the heart of business. All businesses have competition, and it is strategy that allows one business to rise
above the others to become successful. Even if you have a great idea for a business, and you have a great product, you
are unlikely to go anywhere without strategy.

Many of the most successful business men and women throughout history have been great strategic thinkers, and that is
no accident. If you wish to take your business to the top of the market as quickly as possible, it is going to be strategy
that leads the way.

Of course, before you can get into the process of determining your own business strategies, you need to understand
what the word ‘strategy’ really means in a business context. Does it involve long-term planning as to the general course
of the business? Or is it related to the day-to-day operations and how they are designed in order to achieve success?
Well, in practical application, strategy can refer to both of those things and more.

To help you understand strategy in business, this article is going to look at the three levels of strategy that are typically
used by organizations. Only when all three of these levels are carefully considered will your business be able to get on
the right path toward a prosperous future.

Corporate Strategy

The first level of strategy in the business world is corporate strategy, which sits at the ‘top of the heap’. Before you dive
into deeper, more specific strategy, you need to outline a general strategy that is going to oversee everything else that
you do. At a most basic level, corporate strategy will outline exactly what businesses you are going to engage in, and
how you plan to enter and win in those markets.
It is easy to overlook this planning stage when getting started with a new business, but you will pay the price in the long
run for skipping this step. It is crucially important that you have an overall corporate strategy in place, as that strategy is
going to direct all of the smaller decisions that you make.

For some companies, outlining a corporate strategy will be a quick and easy process. For example, smaller businesses
who are only going to enter one or two specific markets with their products or services are going to have an easy time
identifying what it is that makes up the overall corporate strategy. If you are running an organization that bakes and sells
cookies, for instance, you already know exactly what the corporate strategy is going to look like – you are going to sell
as many cookies as possible.

However, for a larger business, things quickly become more complicated. Carrying that example forward to a larger
company, imagine you run an organization that is going to sell cookies but is also going to sell equipment that is used
while making cookies. Entering into the kitchen equipment market is a completely different challenge from selling the
cookies themselves, so the complexity of your corporate strategy will need to rapidly increase. Before you get any
farther into the strategic planning of your business, be sure you have your corporate strategy clearly defined.

Business Strategy

It is best to think of this level of strategy as a ‘step down’ from the corporate strategy level. In other words, the strategies
that you outline at this level are slightly more specific and they usually relate to the smaller businesses within the larger
organization.
Carrying over our previous example, you would be outlining separate strategies for selling cookies and selling
cookie-making equipment at this level. You may be going after convenience stores and grocery stores to sell your
cookies, while you may be looking at department stores and the internet to sell your equipment. Those are dramatically
different strategies, so they will be broken out at this level.

Even in smaller businesses, it is a good idea to pay attention to the business strategy level so you can decide on how you
are going to handle each various part of your operation. The strategy that you highlighted at the corporate level should
be broad in scope, so now is the time to boil it down into smaller parts which will enable you to take action.

Functional Strategy

This is the day-to-day strategy that is going to keep your organization moving in the right direction. Just as some
businesses fail to plan from a top-level perspective, other businesses fail to plan at this bottom-level. This level of
strategy is perhaps the most important of all, as without a daily plan you are going to be stuck in neutral while your
competition continues to drive forward. As you work on putting together your functional strategies, remember to keep
in mind your higher level goals so that everything is coordinated and working toward the same end.

It is at this bottom-level of strategy where you should start to think about the various departments within your business
and how they will work together to reach goals. Your marketing, finance, operations, IT and other departments will all
have responsibilities to handle, and it is your job as an owner or manager to oversee them all to ensure satisfactory
results in the end. Again, the success or failure of the entire organization will likely rest on the ability of your business
to hit on its functional strategy goals regularly. As the saying goes, a journey of a million miles starts with a single step
– take small steps in strategy on a daily basis and your overall corporate strategy will quickly become successful.

Good strategy alone isn’t going to automatically lead you to success in business, but it certainly is a good place to start.
Once you have sound strategies in place, the focus of the organization will shift toward executing those strategies
properly day after day. Of course, your strategies will need to be continually monitored and adjusted as you move
forward to ensure you are staying on a path that is consistent with the goals of the business, so always keep the three
levels of strategy near the front of your mind as your guide your company.
Culture and Stretegy

Business Strategy BUSINESS STRATEGY REPRESENTS CLEARLY IDENTIFIED FEASIBLE ROUTE FOR
STEERING ACTIVITIES ONTO ATTAINMENT OF GOALS AND OBJECTIVES.

Three Levels of Strategy

1. Corporate Level Strategy
2. Business Unit Level Strategy
3. Functional/Operational Level Strategy

Corporate Level Strategy

Managing Activities and Business Interrelationships.

Corporate Responsibilities.
Management Practices.
Competitive Contact.

Business Unit Level Strategy

Influencing the layout of competition by means of action such as vertical integration.
Positioning the firm’s business against competitors.
Modifying actions to cope with changes in demand, supply, regulations and technology.
Developing useful partnerships with customers and other business units.

Functional/Operational Level Strategy

Business development
Production
Finance
Human resource and materials management

Generic Range of Strategies

Differentiation Strategy
Cost Leadership Strategy
Focus Strategy

CULTURE
Corporate Culture “Corporate culture is a system of shared values, assumptions, beliefs, and norms that unite
the members of an organization.” - Kathryn Bartol, Management

Interactivity of Culture and Strategy

Strategy
Culture
Cultural Thrust Impacting Strategy

Functions of culture
Organizational Culture
Organisational Identity
Collective Commitment
Social System Stability
Sense-Making Device

Cultural Analysis focus on identification of the key components of an organisation’s culture and ascertainment
of resultant alignment with strategic intent, strategies, policies and business development imperatives.

Two Levels of Cultural Analysis

• Analysis of Elements of Culture
• Analysis of Cultural Expressions
 The Impact of Corporate Culture on Business Strategy
•Risk
•Employee Retention
•Incentive Pay
•Focus

Aligning Business Strategy with Corporate Culture

In effect, the whole goal for aligning business strategy with corporate culture is to ensure the components of
active culture within the organization would facilitate seamless operability for established strategies.

Forces of Corporate Culture

• Leadership Stream
• Teamwork Dynamics
• Workplace Communication
• Paradigms
• Rituals and Routines
• Power Structures
• Symbols
• Exploratory Engagement
• Social Connectivity
• Organizational Structures

Matching Organization Structure To Strategy

There is no one optimal organizational design or structure for a given strategy or type of organization. What is
appropriate for one organization may not be appropriate for a similar firm. The choice of structure must be
determined by the firm's strategy.

All of the basic organizational form have their strategy related strengths and weaknesses, thus the best organizational
arrangement is the one that best fits the firm's situation at the moment.

The following five sequence procedure is a useful guide for fitting structure to strategy:

1. Pinpoint the key functions and tasks necessary for successful strategy execution.
2. Reflect on how strategy critical functions and organizational units relate to those that are routine and to those
that provide staff support.
3. Make strategy critical business units and functions the main organizational building blocks.
4. Determine the degrees of authority needed to manage each organizational unit bearing in mind both the
benefits and costs of decentralized decision making.
5. Provide for coordination among the various organizational units.