MANAGEMENT FUNCTIONS

According to: -
Fayol: Planning, Organizing, Directing, Coordinating and Controlling
Koontz: Planning, Organizing; Staffing, Directing and Controlling
Planning Function
Planning: It is looking ahead and charting out future courses of action to be followed. It is a preparatory step.
It is a systematic activity which determines when, how and who is going to perform a specific job. Planning is
a detailed programme regarding future courses of action.
1. Koontz & O’Donell, - Planning is deciding in advance what to do, how to do and who is to do it. Planning
bridges the gap between where we are to, where we want to go. It makes possible things to occur which
would not otherwise occur”.
2. Also defined as deciding in advance what to do and how to do it; It bridges the gap from where we are &
where we want to be. It is a process of looking ahead: Determining future course of action: Deciding or
finding out: - [WHAT – to be done]; [How- to do do]; [Who- to do]; [When - to be done]; [Where- to be
done]
Steps in Planning Function: It involves
1. Establishment of objectives: Starts with the setting of goals and objectives [rationale for undertaking
activities which should be stated in quantitative terms, practical, acceptable and workable
2. Establishment of Planning Premises: (Assumptions about events in future concerned with determining
deviation, causes and avoid negative impact later, Includes all business areas and environment
3. Choice of alternative course of action: - Merits, demerits of each alternative must be examined before
the choice is being made; then through scientific evaluation best alternative is chosen.
4. Formulation of derivative plans: - Derivative plans indicate time schedule and sequence of accomplishing
various tasks
5. Secure Co-operation: - Inform implementers for motivation and obtain valuable input for improvement
6. Implement and appraise plans: - Establishes a link between planning and controlling function.
Characteristics of Planning
1. Is goal-oriented and made to achieve desired objective of business.
2. Is looking ahead for future = forecast
3. Is an intellectual process= Involves creativity and sound judgement, facts
4. Involves choice & decision making surrounding managers in the environment
5. Is the Foundation for other management functions
6. Is a Continuous Process. Exists as long as enterprise exists
7. Is all Pervasive- managers, departments at all levels
8. Is designed for efficiency =leads to saving time, effort and money
9. Is Flexible provide room to cope with changes in demand, competition, govt. policies
Advantages of Planning
1. Facilitates order and rational
2. Minimizes uncertainties= helps forecast uncertainties
3. Facilitates co-ordination – integrate efforts of the enterprise to avoid duplication
4. Improves employee’s moral = creates a healthy attitude in work environment
5. Helps optimizing of allocation of resources
6. Facilitates controlling = provides pre-determined goals against which actual compare
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7. Provides competitive edge leading to improvements of quality in production
8. Encourages innovations = in process suggestions improvements for growth and prosperity
Limitations of Planning (Disadvantages)
1. Rigidity = Inelasticity/inflexible individual freedom, employees are doubted
2. Misdirected Planning = may serves individual interests that influence plans: full of bias
3. Time consuming = collect information, analysis and interpretation requires time limiting
4. Based on mere estimates about future which may never happen so at times may prove fatal
5. False sense of security = as everybody is concerned with fulfilment of plans and performance
6. Expensive = collection, analysis/evaluation of information and alternatives needs time/money
Features of Planning as a primary function of Management
1) Planning focuses on achieving objectives:
2) Planning is pervasive
3) Planning is continuous
4) Planning is futuristic
5) Planning involves decision making:
6) Planning is a mental exercise
TYPES OF PLAN
a) Strategic plans - Broad plans developed by top managers to guide and direct he firm. They follow major
goals and indicate the business and what it intends to be e.g. Mission, Strategies/objectives, SWOT
b) Tactical plans - Moderate scope and immediate timeframe; concerned with how to implement the
strategic plans and deal with specific resources and time constraint = middle management.
c) Operational plans - Narrowest focus and fall into many types include departmental
Schedules are important component of operational planning-defines time frames for
objectives/activities.

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 ORGANIZING FUNCTION
Organizing: is the process of creating a structure for the organization that will enable the various players to work
together effectively.
Concepts
1. Authority: - It is the right to do something –to accomplish organizational goals. Managerial authority is the right to
command others by making decisions
2. Power: Is the ability to do it. The sources of a manager’s power are: Power is subjective and is influenced by moral
and ethical considerations.
3. Accountability: - Created within a person when accepting an assignment. A manager cannot reduce responsibility
by delegating, accountability cannot also be reduced.
4. Responsibility: - This is closely related to authority and power. It refers to the obligation to do something. It is the
duty to perform organizational tasks, functions etc. .
Steps in Organizing:
a) Reflect on the plans and objectives of the organization
b) Determine major tasks/activities to be done to fulfill the goals
c) Group/assign/Divide the major tasks into sub-tasks
d) Delegate the necessary authority to the subordinates to carry out the activities
e) Allocate resources to the tasks and then evaluate the results of the organizing strategy
Importance of organizing Function
a) Necessary to avoid confusion of roles, tasks etc.
b) Clarifies the responsibilities of the employees of the organization
c) Allocates accountability to each employee for better outcomes of work
d) Establishes clear channels of communication
e) Enables managers to deploy resources (all) meaningfully and synergy can be reached
f) Enables monitoring of organizational activities
g) Allows for co-ordination of different parts of the organization and different areas of work
h) Provides the flexibility needed to respond to future demands and developments
Principles of Organizing
a) Specialization – Work is divided amongst subordinates on qualifications, abilities and skills.
b) Functional Definition - All work, authority, relationships and functions should be defined, completely and
clearly to the managers and subordinates E.g. production, marketing etc.
c) Span of Control/Supervision – No of subordinates that can be managed efficiently and effectively by a
superior; Span of supervision showing the number of employees that a manager supervises effectively:
Should be decided and communicated: Two types of span of control:-
a) Wide span of control- Supervise effectively a large group of persons at one time where:-
b) Narrow span of control- work and authority is divided amongst many supervisors. The manager
selects a number of employees at one time.
Factors influencing Span of Control
a) Managerial abilities- Able, qualified and experienced =wide span.
b) Competence of subordinates- Do not need to constantly ask managers to solved problems
c) Nature of work- If the work is of repetitive nature, wide span of supervision is more helpful
d) Delegation of authority- Proper delegation removes confusion = wide span is suitable
e) Degree of decentralization- Leads to specialization and a tall structure is helpful
c) Principle of Scalar Chain - Authority flows from top to bottom. A scalar chain of command facilitates work
flow which helps in achievement of effective results
d) Principle of Unity of Command – One subordinate-one superior relationship avoids communication gap.

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Departmentalization
Process of horizontal clustering or grouping of work activities into homogenous units
Centralization: Decision making process expanded or narrowed at different lower levels = Tiered
Advantages
- The activity has a definite completion date
- Cost constraints are a critical factor
- Specialized skills are required for the completion of a project
- Activity is new or unfamiliar to the participants
- When a high degree of competence is required and flexibility is needed
- The need to share resources and reduce costs
Disadvantages
- Conflict over allocation of resources and division of authority
- Dilution of functional authority
- Divided loyalty for project teams
- It sacrifices the principle of unity of command

Formal and Informal Organizations

Formal organization is “a system of consciously coordinated activities or forces of two or more persons. It
refers to the structure of well-defined jobs, each bearing a definite measure of authority, responsibility and
accountability." In formal originations there is Division of labour; functional processes, structure and span of
control
Informal Organization: - refers to the relationship between people in the organization based on personal
attitudes, emotions, prejudices, likes, dislikes etc. It is an organization which is not established by any formal
authority, but arises from the personal and social relations of the people. The relations are not developed
according to procedures and regulations laid down, but informal or social groups

Formal Organization Informal Organization

Formal
1. It is created by the top management
2. Created for performance of work in a
planned/systematic manner
3. It is managed by officially appointed managers
4. Managers of formal organization have formal
authority
5. Formal organization is permanent and stable
Informal
It is not created by top management.. It arises out of the natural
desire of the people to associate
It is formed to satisfy those needs of members which cannot be
satisfied through formal organization
Members of the informal group select someone as their leader to take
care of the interests of the group
The authority depends upon the combined support of groups
members
Informal organization is of temporary nature. It changes its size and
membership from time to time

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DELEGATION
Delegation is subdivision and sub-allocation of powers to the subordinates in order to achieve effective results: that is
entrusting someone else to do parts of your job
Elements of Delegation
1. Authority – Is power and right of a person to use and allocate the resources efficiently, to take decisions and to give
orders/commands so as to achieve the organizational objectives;
2. Responsibility - is the duty of the person to complete the task assigned to him. Responsibility flows from bottom to
top. The middle level and lower level management holds more responsibility. It is absolute
3. Accountability - means being answerable for end results giving explanations for any variance in the actual
performance from the expectations set. Accountability cannot be delegated. The top level management is most
accountable. It arises from responsibility. Obligatory
Delegation of authority involves following steps:-
1. Assignment of Duties - Define the task and duties and the result expected from each subordinates
2. Granting of authority - Give enough independence to carry the task given to the subordinate
3. Creating Responsibility and Accountability - obligation of an individual to carry out his duties effectively.
Relationship between Authority and Responsibility
Authority Responsibility
Legal right of a person to command subordinates. The obligation of subordinate to perform work assigned
Attached to the position of a superior in concern. Arises out of superior-subordinate relationship
Can be delegated by a superior to a subordinate Responsibility cannot be shifted and is absolute
It flows from top to bottom. It flows from bottom to top.
The importance of delegation -
1. Enable managers to divide and allocate work to the subordinates freeing himself for other functions
2. Enable managers to bring effectiveness in the unit
3. Gives subordinates enough room grow and flourish
4. Develops job satisfaction, breaks monotony and gives rise to creativity and efficiency
5. Gives stability to an organization
Centralization and Decentralization
Centralization is a process where the concentration of decision making is in a few hands. Centralization is the systematic
and consistent reservation of authority at central points in the organization.
Decentralization is a systematic delegation of authority at all levels of management and in all of the organization.. Rest
of the authority may be delegated to the middle level and lower level of management: (Case study of Kenya devolution)

Distinguish between Delegation & Decentralization?

Delegation
Scope of delegation limited to the subordinates individually
Responsibility remains with managers
No freedom to subordinates as per the instructions.
Delegation is important in all organizations
Authority granted by one to another.
Responsibility cannot be delegated
Degree of delegation varies from organization/department
A process which explains superior subordinates relationship
Essential for creating the organization
Delegated authority can be taken back.
Very little freedom to the subordinates
Decentralization
Scope is wide as the decision making is shared
Responsibility delegated to subordinates.
Work freedom is maintained by subordinates
Decentralization becomes important - large
A systematic act at all levels and functions
Authority with responsibility delegate-down
Decentralization is natural/spreads through the organization
Is an outcome explaining relationships top <> other department
Optional policy/discretion - top management
A general policy applicable to all
Considerable freedom

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Directing Function of Management
DIRECTING - is a process of instructing, guiding and overseeing the performance of all operations of an organization to
achieve predetermined goals. 
It is the process by which actual performance of subordinates is guided towards common goals;
Directing is a process of instructing and overseeing performance of the works to achieve pre-determined goals
a)
b) Supervision- overseeing the work of subordinates at the work in order to guide and regulate their efforts: .
c) Communication: Communication involves exchange of ideas and information in order to create mutual
understanding. Sound communication fosters mutual understanding and coordination among different units
d) Motivation: Motivation implies inspiring the subordinates to work with zeal and confidence.. Motivation is a
continuous process of understanding and satisfying human needs.
e) Leadership: Leadership is the process of guiding and influencing subordinates for the accomplishment of desired
goals. It involves the integration of organizational interests with personal goals..

Importance of Directing Function

Several benefits are provided to an organization because direction is the central point as follows: -
a) Initiates actions: Directions is the beginning of the subordinate’s execution of their work
b) Integrates efforts: Every department’s efforts is connected & included along with others in proper direction.
c) Is a means of motivation: The function of direction aids in achieving all the goals effectively.
d) Provides stability: Provide balance and constancy is very vital for surviving in the market in the long run.
e) Enable staff cope with changes: environment changes are managed easily through communication.
f) Helps in efficient utilization of resources: The proper direction of money .

Directing is a) communicating b) leading and c) motivating.

1) Communication - Process of passing information and understanding from one person to another person.
2) Leadership is the process in which a manager guides and influences the effort of his subordinates.
3) Motivation means arousing desire or wish in the minds of workers to give their greatest to the enterprise. It is the
act of inspiring or rousing workers. If the workers of an organization are appropriately motivated they will pull their
weight efficiently, give their loyalty to the enterprise, and perform their duty effectively,

Leadership - What is leadership; explain the characteristics and importance of Leadership?

Leadership is a process of directing, guiding and influencing the behavior and work of others towards accomplishment of
specific goals in a given situation. Leadership is the ability of a manager to induce the subordinates to work with
confidence and zeal. Capacity to influence a group towards the realization of a goal

Leader versus Manager

Manager Leader
 Do things right  Do the right thing
 Command and control  Inspire and empower
 Seek stability and predictability  Seek flexibility and change
 Are internally focused  Are extremely oriented
 Work within the firm  Coordinate the whole system
 Are locally oriented  Are globally oriented
 Think mostly of workers  Think mostly of customers and other stakeholders

Importance of Leadership
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a) Initiates action- a person who starts the work by communicating the policies and plans
b) Motivation- A leader proves to be playing an incentive role
c) Providing guidance- instructing the subordinates the way to perform their work effectively and efficiently
d) Creating confidence- clearly explain role and giving guidelines to employees to achieve goals effectively
e) Building morale- Morale is willing co-operation towards work & getting of confidence/winning of trust
f) Builds work environment- An efficient work environment helps in sound and stable growth.
g) Co-ordination- Is achieved through reconciling personal interests with organizational goals
Leadership styles
1) Autocratic leadership style: A leader has complete command and hold over their employees. Staff cannot put
forward their views even if they are best for the organizational interests. They cannot criticize or question the
leader‘s way: This style leads to speedy decision-making and greater productivity. But the style leads to greater
employee absenteeism and turnover.
2) The Laissez Faire Leadership Style: The leader totally trusts employees to perform the job themselves and only
concentrates on the intellectual/rational aspect of his work. Employees are welcomed to share views or suggestions
best for organizational interests. The style works when the employees are skilled, loyal, experienced and
intellectual.
3) Democratic/Participative leadership style: The leaders invite and encourage employees to play an important role in
decision-making process, though the ultimate decision-making power rests with the leader. The leader guides the
employees on what and how to perform, while the employees communicate their experience and the suggestions if
any. Leads to satisfied, motivated and more skilled employees building creativity but also time-consuming.
4) Bureaucratic leadership: Leaders strictly adhere to the organizational rules and policies; make sure the employees
strictly follow the rules and procedures. Promotions on the basis of employees ‘ability to stick to rules. The style is
more suitable when safe work conditions and quality are required e.g. military

Decision Making Process

Decision is defined as a course of action purposely chosen from a set of alternatives to achieve objectives/ goals. It is
continuous and indispensable to any organization.
Steps in Decision Making
1. Define/Identify Problems: Recognize that there is a decision to be made not arbitrarily but to address a specific
problem, need or opportunity.
2. Gather information and collect data : - Seek out a range of information to clarify options. Seek to determine
potential causes of a problem, the people and processes involved and any constraints on decision-making process.
3. Develop and weigh the options: - Makes lists of potential solutions depending on the nature of the decision.
4. Choose best possible Alternative:- Select the option that has the best chance of success at the least cost
5. Plan and Executive/Implement the Plan: - Put into action and bring all employees on board
6. Follow up action/Evaluate Outcomes: - There has to readiness to adapt plan as necessary, or to switch to another
potential solution if your chosen solution does not work out the way expected.
Decision Making Approaches in Management
Decision making is grouped into four approaches to decision making. The 4 are: - a) Directive style, b) Analytic style, c)
Conceptual style, and d) Behavioral style. No one fits completely into just one style category. Certain situations may
require different approaches of decision making in order to be effective.
1. Directive: - The style relies on a rational and autocratic style that results in the employee using his own knowledge,
experience and judgment to choose the best alternative. This type of leader style thinks mostly about the short-
term. The biggest issue in this style of decision making is that rarely does the leader have all of the pertinent
information to make an effective decision.
2. Conceptual: - More concerned with long-term results, brainstorming of alternatives, creative approaches to
problem solving and taking higher risks.
3. Analytical: - Observes the situation and orients him/her (self) & then decides and acts accordingly. Use of direct
observations, facts and data to determine the best outcome; It is time consuming since it looks at every possible
alternative; it focus on negotiation.

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4. Behaviour Style: - The leaders who follow this model believe in participative management and consider the
achievement of subordinates and always take suggestions from them. They try to get inputs from subordinates
through meetings and discussions. They try to avoid/resolve conflicts as acceptance by others is important to them.
They are intuitive

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CONTROLLING
Controlling is a systematic exercise which is called as a process of checking actual performance against the standards or
plans with a view to ensure adequate progress and also recording such experience as is gained as a contribution to
possible future needs.
The Factors to be considered in Controlling:
1. Size of Business: Growth of organizations complexity increase and therefore need for controls
2. Uncertainty: Points need to check frequent unpredictable changes Control forms a basis for future action.
3. Decentralization Trends: Control serve purpose of monitoring decentralized decision making and authority
4. Morale: Workers are happier when things are under control
Steps in Controlling Process
1. Establishment of standards- Standards are criterions for judging the performance; classified into two: they are
both quantitative and qualitative terms
2. Measurement of actual performance- Performance is measured in an objective and reliable manner. Should be
checked in the same unit in which the standard area set. Measurement of tangible standards is easy as it can be
expressed in units, cost, money terms.
3. Comparison of actual and standard performance- Involves comparing the actual performance with standards laid
down in order to find the deviations.
4. Analysis the cause of deviations. Managers must determine why standards were not met. This step also involves
determining whether more control is necessary or if the standard should be changed.
5. Taking remedial actions- Managers then develop solutions for issues determined. Errors detected have to be
remedied
Types of Control
1. Preliminary: - Sometimes called the feed-forward controls, they are accomplished before a work activity begins. They
make sure proper directions are set &that the right resources are available to accomplish them.
2. Concurrent: - Focus on what happens during the work process. Sometimes called steering controls, they monitor
ongoing operations and activities to make sure that things are being done correctly.
3. Post-action: - Sometimes called feedback controls, they take place after an action is completed. They focus on end
results, as opposed to inputs and activities.
Span of Control
Span of control is a dimension of organizational design measured by the number of subordinates that report directly to a
given manager. This concept affects organization design in many ways,
− including speed of communication flow,
− employee motivation,
− reporting relationships, and
− Administrative overhead.
Factors affecting Span of Control
1. Job complexity. Subordinate jobs that are complex, ambiguous, dynamic or otherwise complicated = narrower span
2. Similarity of subordinate jobs. The more similar and routine the tasks that subordinates are performing, = wider the
span of management that will likely be effective.
3. Physical proximity of subordinates . The more geographically dispersed a group of subordinates’ narrower span of
management.
4. Abilities of employees. Managers who supervise employees that lack ability, motivation, or confidence will have to
spend more time with each employee= narrower span of management.
5. Abilities of the manager. Some managers are better organized, better at explaining things to subordinates, and
more efficient in performing their jobs
6. Technology. Cell phones, email, and other forms of technology that facilitate communication and the exchange of
information make it possible for managers to increase their spans of management over managers who do not

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Nature and Characteristics of Controlling Function
1. Controlling is a Fundamental Management Function : most is the most important
2. Pervasive for Every Manager (Universal): It is performed in all organizations at all managerial levels
3. It is a Continuous Activity: Not a one-step process; Activities are repeated often and at all times and futuristic
4. At Both the Beginning and the End of the Process of Management: Felt throughout the process
5. Controlling is related to Results: Because it is assessing progress and taking corrective measures
6. It is Dynamic process: Involves continuous review and may lead to changes in other functions
7. Guided by Information: accurate and timely feedback is essential for effective control
8. It is essence is Action: achieved only when corrective action is taken
9. Uses Delegation as key: correction is done based on delegated authority

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CHANGE MANAGEMENT
In order to survive organizations must embrace change for the better. Change is an inescapable part of both social and
organization life and can affect all aspects of the operation and function of the organization (Armstrong (2005).
Nature of Change
Change is a shift or alteration in the present situation. Organizational change is a process in which an organization takes
new ideas or ways in a bid to become different.
Organizational-wide change may be experienced when there is a shift or alteration in various areas which may include
change in the organization’s mission, restructuring operations, introduction of new product line or production lines, re-
engineering, top management changes, tighter production schedules and divestitures. Mullins (2005): It is systematic
approach to dealing with change, both from an individual or organizational perspective level.

Types of change
1. Strategic change: - Concerned with organizational transformation. Deal with board, long term organization- wide
issues. About moving to a future state defined generally in terms of strategic vision and scope.
2. Operational change: - Relates to new systems, procedures, structures or technology which normally will have an
immediate effect on working arrangements within the organization

Challenges of Management:
The manager’s job is full of challenges and has grown especially in recent years.
The following factors have contributed to this increase in the challenge to management:

1) Organizational Size and Geographic Scope: Rate of growth of the business and expansion
2) Specialization of Labour and Complexity of labour : - Processes involved in the production; Managers must integrate
and schedule the work of various departments. This is no doubt a complex task.
3) Changed Status of Employees: They have more education, stronger desires for individual identity and recognition
and less patience for seemingly meaningless work, strong bargaining power
4) Government Regulation: -Regulatory agencies like Commission, Bureau of Costs and Industrial Prices, Environment
Protection Agency, etc. regulate almost all major aspects of organizational policy and behaviour.
5) Accelerating Change: - Cope with rapid inflation, energy crisis, growing commission, changing social and cultural
trends as well as with scientific and technological innovation

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