functions of Management 101 – The

Importance Of The Top 5 Functions

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What does a company value more, time or

money?  The answer can be debatable, but one thing is for sure.  Time is continually
passing, and there is no stopping it.  That is where management steps and does what it
is supposed to do, manage time as efficiently as possible.  But that isn’t the only job
managers have to do.  In the next few sections below, you will see why management is
important and the top five functions of management in an organization.

To define management in the business world, it is the organization of activities of a

company to reach defined objectives.  This is usually accomplished by directors and
managers who have the authority to make decisions in the company.  In corporations,
the board of directors or the chief executive officer (CEO) is usually in charge of
management. 

Why Is Management Important?

All organizations rely upon group efforts to achieve goals.  And whenever two or more
people are required to work together, management is necessary.  According to the U.S.
Bureau of Labor Statistics, management positions are projected to continue to grow by
an average of 7% percent.  If that is not enough reason to become a believer in
management, maybe the reasons below will:

 Accomplish goals – It is possible to accomplish goals without management, but it

would be extremely difficult.  With proper management, an organization is
allowed to plan and balance their resources in such a way that every task is
completed.  This does not only relate to businesses, but it also applies to our
lives.
 Be more efficient – There are only so many hours in a work day, so it beneficial to
make the most of it.  The last thing a company wants its employees to do is to
waste time.  With good time management skills, companies are able to get as
much work done as possible with the time given to them.
 Make better decisions – The choices a business makes can make the difference
between being successful to being a complete disaster.  Therefore, making
rational decisions is vital for a company if they want to do well. With good time
management, they will have more time to weigh out the positives from the
negatives in their decision making.
 Earn more profit – When all of the other benefits mentioned above are met, it will
usually equal to an increase of profit for the company.  The most successful and
profitable businesses in the world attribute a lot of it to their management skills

Five Functions of Management

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There are more functions of management than the ones listed below, but these are
considered the most important.  Learning how to balance each of these is the key to
effective management within a company.  If you are focused too much on one function
as opposed to another, the imbalance can impact both the employees and
management.

Planning

This is the core function of management because it is the foundation of the other four
areas.  Planning involves mapping out exactly how to achieve a specific goal.  As a
manager, he or she will need to map out detailed actions;  what to do, when to do it and
how it should be done.  Think of it as bridging a gap for where we currently are and
where we want to be.  For example, if the company’s goal is to earn profit, the manager
needs to determine the steps necessary to achieve that goal.  This can include spending
more on advertising, hiring more experienced employees, cutting costs, or improving
the products being sold.

Planning is always an going process.  There will be times when external factors will affect
the company both positively and negatively.  This in turn may alter the original planning
process in reaching certain goals.  This is known as strategic planning.  Depending on
the exact scope of an organization, the strategic planning process can look ahead as far
as ten years or more.  The findings are usually collected in a strategic planning
document.

Organizing

Management Skills students also learn

Leadership   Manager Training   Project Management   Time

Management   Personal Productivity   Communication Skills   Business

Strategy   Business Fundamentals   Product

Management   Excel   Marketing Strategy   Personal

Development   Human Resources   Agile

Immediately after planning, the manager needs to organize the team according to plan. 
This involves organizing all of the company’s resources to implement a course of action
and determining the organizational structure of the group.  And in order to do this
correctly, management will need to evaluate the different divisions of departments and
the staff to figure out the best way to accomplish the tasks needed to reach their goals.

This function is also known to be the backbone of management.  Without organization,

a company will have no structure and their day-to-day operation of business will most
likely collapse.  If management is disorganized, it can trickle down to the employees
because they will lose confidence in their leaders.

Staffing

The purpose of staffing is to control all recruitment and personnel needs of the
organization.  After management decides what needs they have, they may decide to hire
more employees in a certain department.  It is also responsible for training and
development, promotions, transfers, and firing.  A lot of times management and the
human recourse department will work together because their roles are similar in this
case.

The importance of this function has grown lately, mostly because of the increasing size
of businesses and the advancement of technology.  A good example of this is the IT
department.  The size of the IT department in a company ten years ago is nothing
compared to what it is now because of the dependence we have on computers and
servers.  Without the staffing function, a business will certainly fail because there will not
be an experienced, sufficient amount of employees within each department.

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Directing

Supervision, motivation, leadership, and communication are all involved in the directing
function.  Management needs to be able to oversee and influence the behavior of the
staff and achieve the company’s goals, whether that means assisting or motivating
them.  When morale is high within a company, it usually has a significant impact on job
performance and efficiency.  Incentive programs and rewards are a great way for a
business to keep its employees happy and motivated.
However, the most important aspect of directing is having good communication.  This
means building positive interpersonal relationships, effective problem solving and
evaluating one another.  Most directing takes place in in meetings and other meeting
sessions with the department leaders to ensure that everyone is on the same page. 
Poor communication will lead to poor execution in an organization,

Controlling

The last function of management deals with monitoring the company’s progress and
ensuring that all of the other functions are operating efficiently.  Since this is the last
stage, there are bound to be some irregularities and complexity within the organization. 
This in turn can lead to certain situations and problems arising that are disrupting the
company’s goals. Given is the stage where all the final data is gathered, it is the
management’s job to take corrective action, even where there is the slightest deviance
between actual and predictable results.

Management Courses

If you want to learn more about the five functions of management, take a look at
our Introduction to Management course.  We also offer a Project Management and
a Classroom Management Essential lesson if you are looking for something more
specific.  As you become more experienced with management skills, you will realize that
it does only apply in the business world, but it can affect your life just as much.

Page Last Updated:  February 2020