BMEC REVIEWER
 Management Function
Describing what managers do isn’t easy. Just as
no two organizations are alike, no two
managers’ jobs are the same. In spite of this,
management researchers have developed three
approaches to describe what managers do:
functions, roles, and skills.
- According to the functions approach,
managers perform certain activities or
functions as they efficiently and effectively
coordinate the works of others.
Henri Fayol
- French businessman,
- first proposed in the early part of the
twentieth century that all managers
perform five functions:
- planning, organizing, commanding,
coordinating, and controlling. Today these
five functions were condensed into four:
planning, organizing, leading, and
controlling.
 Functions of Managing
1. Planning
- Management function that involves setting
goals, establishing strategies for achieving
those goals, and developing plans to
integrate and coordinate activities.
2. Organizing
- Management function that involves arranging
and structuring work to accomplish the
organization’s goals.
- When managers organize, they determine
what tasks are to be done, who is to them,
how the tasks are to be grouped, who
reports to whom, and where the decisions
are to be made.
3. Leading
- Management function that involves working
with and through people to accomplish
organizational goals.
- When managers motivate subordinates, help
resolve work group conflicts, influence
individuals or teams as they work, select
the most effective communication channel,
or deal in any way with employee behavior
issues, they are leading.
4. Controlling
- After goals and plans are set, tasks and
structural arrangements put in place, and
people hired, trained and motivated, there
has some evaluation of whether things are
going as planned.
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- Managers must monitor and evaluate
performance to ensure that goals are being
met and job is being done as it should be.
- Controlling involves monitoring, comparing,
and correcting work performance.
In reality, what a manager does may not always
happen in sequence. Regardless of the order in
which these functions are performed, however, the
fact that managers plan, organize, led and control
as they manage.
 Management Roles
Mintzberg’s Managerial Roles and a Contemporary
Model of Managing
- Henry Mintzberg, a well-known management
researcher, studied actual managers at
work. In his first comprehensive study,
Mintzberg concluded that what managers
do can best be described by looking at the
managerial roles they engage in at work.
- The term managerial roles refers to specific
actions or behaviors expected of and
exhibited by a manager.
- (Think of the different roles you play—such
as student, employee, student organization
member, volunteer, sibling, and so forth—
and the different things you’re expected to
do in these roles.)
- When describing what managers do from a
roles perspective, we’re not looking at a
specific person per se, but at the
expectations and responsibilities that are
associated with being the person in that
role— the role of a manager.
 These 10 roles are grouped around
interpersonal relationships, the transfer of
information, and decision making.
1. Interpersonal Roles
- are ones that involve people (subordinates
and persons outside the organization) and
other duties that are ceremonial and
symbolic in nature. The three interpersonal
roles include:
- figurehead
- leader
- liaison.
2. Informational Roles
- involve collecting, receiving, and
disseminating information. The three
informational roles include:
- monitor
- disseminator
- spokesperson.
3. Decisional Roles
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- entail making decisions or choices. The four
decisional roles include:
- entrepreneur
- disturbance handler
- resource allocator
- negotiator.
- As managers perform these roles, Mintzberg
proposed that their activities included both
reflection (thinking) and action (doing).
Recently, Mintzberg completed another-hands-on
and up-close study of managers at work and
concluded that,
“Basically, managing is about influencing action.
It’s about helping organization and units to get
things done, which means action”.
 Based on his observations, Mintzberg went on
to explain that a manager does this in three
(3) ways:
 By managing actions directly (for
instance, negotiating contracts,
managing projects, etc.)
 By managing people who take action
(for example, motivating them,
building teams, enhance the
organization’s culture, etc.)
 By managing information that propels
people to take action (using budgets,
goals, task delegation, etc)
 Management Skills
- (basahin nalang daw) Dell Inc. is a company
that understands the importance of
management skills, it started an intensive
five-day offsite skills training program for
first-line managers as a way to improve its
operations. One of Dell’s directors of
learning and development thought this was
the best way to develop, “leaders who can
build that strong relationship with their
front–line employees”. What have the
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supervisors learned from the skills training?
Some things they mentioned were how to
communicate more effectively and how to
refrain from jumping to conclusions when
discussing with a worker.
 Robert L. Katz
- is an American social and organizational
psychologist.
- He created the concept of managerial skills,
which describes how the required skills
structure changes, depending on the
management level. What types of skills do
managers need? Robert L. Katz proposed
that managers need three critical skills in
managing: technical, human, and
conceptual.
 Technical Skills
- Are specific job knowledge and techniques
needed to proficiently perform work task.
- These skills tend to be more important for
first-line managers because they typically
are managing employees who use tools
and techniques to produce the
organization’s products or service the
customers.
- Having appropriate technical skills signify
that the person is competent and
knowledgeable with respect to the
activities specific to an organization, the
organization’s rules, and standard
operating procedures, and the
organization’s product and services.
- Example: In accounting firm, technical skill
might include understanding of generally
accepted accounting principles, knowledge
of commercial laws, and knowledge of tax
laws, etc.
 Human Skill
- it relates to the ability to work with people
both individually and in group. Because all
managers deal with people, these skills are
equally important to all levels of
management.
- Managers with good human skills get the
best out of their people.
- They know to motivate, communicate, lead
and inspire enthusiasm and trust.
- Some human skills that are generally
considered important are effective
communication (both verbal and written),
motivating others and creation of a positive
attitude, development of cooperation and
team spirit etc.
 Conceptual Skills
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- These are skills managers use to think and quality and reduce cost so they become an
conceptualize about abstract and complex important ingredient in the efficient
situations. management of management.
- Using these skills, managers see the
organization as a whole, understand the
relationships among various subunits, and 5. Methods – refers to the normal and
visualize how the organization fits into its prescribed way of doing things. Various
broader environment. operations are performed according to
- These skills are most important to top certain systems and procedures. Use of
managers. right methods contribute to increase in
- Some conceptual skills that are generally efficiency of operations and contributes to
important are creativity, decision-making, effective management.
wing to wing interconnectedness, thinking
It is the duty of the management or managers to
as a whole, strategic thinking, problem-
understand the basic nature and functions of each
solving, etc.
M and the source of availability. Managers must
clearly know the purposes of which the other
factors are employed and coordinated to optimize
their combined productivity.

 Why study Management?

- The universality of management is an

It will also be disastrous for organizations not to
properly and effectively organize the 5 M’s for the
organization’s success.
Structural Elements (5 M’s) of Management
important concept in the modern
management thought.
- When describing management as universal,
we refer to the widespread practice of
management in all types of organizations
and we want to find ways to improve the
way organizations are managed.
- Management is universally needed in all
organizations, so we want to find ways to
improve the way organizations are
managed.

1. Money – it is the most critical and all-

purpose resource because it used to
acquire or hire other resources. In
organization, money is employed to
generate more in the forms of profit or
income.
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2. Manpower – it refers to the managerial
and non-managerial personnel employed in
an organization. Other resources cannot act
by themselves and have to be utilized by
human beings. Human resources mobilize,
utilize and allocate physical and financial
resources of the organization.
3. Materials - represent the physical raw
materials and intermediate products which
are converted and/or assembled into
finished products with the help of certain
process and technology.
4. Machinery – machines are the equipment
used to process the materials into semi-
finished or finished products. With the used
of modern machinery, they help to improve
- Why? Because we interact with
organizations every single day.
- Are you frustrated when you have to spend
two hours of waiting in a government office
just waiting for the releasing of your
driver’s license?
- Are you irritated when none of the sales-
people in a retail store seems interested in
helping you?
- These scenarios show problems created by
poor management.
- Organizations that are well managed –
develop a loyal customer base, grow, and
prosper, even during challenging times.
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- By studying management, you’ll be able to
recognize poor management and work to
get it corrected.
- Another reason of studying management, is
the reality that you will either manage or
be managed. For those who plan to be
managers, an understanding of
management forms the foundation upon
which to build your management skills.
Summary of Learning Outcomes
- Managers are important to organizations
for three reasons.
- First, organizations need their managerial
skills and abilities in uncertain complex, and
chaotic times.
- Second, managers are critical to getting
things done in organizations.
- Finally, managers contribute to employee
productivity and loyalty; the way
employees are managed can affect the
organization’s financial performance; and
managerial ability has been shown to be
important in creating organizational value.
- Managers coordinate and oversee the work
of other people so that the organizational
objectives can be achieved. In a traditional
structured organizations, managers can be
first-line, middle, or top.
- Management is what managers do and
management involves coordinating and
overseeing the efficient and effective
completion of other’s work activities.
Efficiency means doing things right and
effectiveness means doing the right things.
The four functions of management,
Mintzberg’s managerial roles and Katz’s
managerial skills can be adapted and use in
managing organizations and the
importance of studying management.
External Environment and Organizational Culture
- The formula for business success requires
two elements –the individual and the
environment. Remove either value and
success becomes impossible.
- The term ‘business environment” implies
those external forces, factors and
institutions that are beyond the control of
individual business organizations and their
management and affect the business
enterprise.
- It implies all external forces within which a
business enterprise operates. Business
environment influence the functioning of
the business system
I. INTERNAL AND EXTERNAL BUSINESS
ENVIRONMENT
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- Business environment may be defined as all
those conditions and forces which are
external to the business and are beyond
the individual business unit, but it operates
within it. These forces are customer,
creditors, competitors, government, socio-
cultural organizations, political parties
national and international organizations
etc. some of those forces affect the
business directly while some others have
indirect effect on the business.
A. FEATURES OF BUSINESS ENVIRONMENT:
Totality of external forces
- Business environment is the sum total of all
things external to business firms and, as
such, is aggregative in nature.
Specific and general forces
- Business environment includes both
specific and general forces.
- Specific forces affect individual enterprises
directly and immediately in their day-to-day
working.
- General force shaves impact on all business
enterprises and thus may affect an
individual firm only indirectly.
Dynamic nature
- Business environment is dynamic in that it
keeps on changing whether in terms of
technological improvement, shifts in
consumer preferences or entry of new
competition in the market.
Uncertainty
- Business environment is largely uncertain
as it is very difficult to predict future
happenings, especially when environment
changes are taking place too frequently as
in the case of information technology or
fashion industries.
Relativity
- Business environment is a relative concept
since it differs from country to country and
even region to region.
- Political conditions in the USA, for instance,
differ from those in China or Pakistan.
Similarly, demand for sarees may be fairly
high in India whereas it may be almost non-
existent in France.
B. TYPES OF ENVIRONMENT:
- On the basis of the extent of intimacy with
the firm, the environmental factors may be
classified into different types-internal and
external.
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- The internal environment is the
environment that has a direct impact on
the business
- Here are some internal factors which are
generally controllable because the
company has control over these factors
- It can alter or modify such factors such as
factor as its personnel, physical facilities,
and organization and functional means, like
marketing, to suit the environment
1. INTERNAL ENVIRONMENT
a. Value system - The value system of the
founders and those at the help of affairs
has important bearing on the choice of
business, the mission and the objectives of
the organization, business policies and
practices.
b. Mission and vision and objectives Vision
- means the ability to think about the future
with imagination and wisdom. It is an important
factor in achieving the objectives of the
organization.
Mission
-is the medium through which the objectives
are achieved.
- Vision: what you want to happen to your
organization in the future
- Mission: how you will conduct
- Objectives: How you will fulfill your mission
and vision
c. Management structure and nature - The
organizational structure like the
composition of board of directors
influences the decisions of business as they
are internal factors.
d. Internal power relationships - The
relationship among the levels of the
organization influences business. The
mutual co-ordination among them is an
important need for a business. The
relationship among the people working in
various levels of the organization should be
cordial.
e. Human resource - The human resource is
the important factor for any organization as
it contributes to the strength and weakness
of any organization. The human resource in
any organization must have characteristics
like skills, quality, high morale,
commitment towards the work attitude,
etc. The involvement and initiative of the
people in an organization at different levels
may vary from organization to organization.
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The organizational culture and overall
environment have bearing on them.
f. Company image and brand equity - The
image of the company in the outside
market has the impact on the internal
environment of the company. It helps in
raising the finance, making joint ventures,
other alliances, expansions and
acquisitions, entering sale and purchase
contracts, launching new products, etc.
Brand equity also helps the company in
same way.
g. Miscellaneous factors - The other factors
that contribute to the business success or
failure are as follows:
 Physical assets and facilities: facilities
like production capacity, technology
are among the factors which influences
the competitiveness of the firm. The
proper working of the assets is indeed
for free flow of working of the
company.
 Research and development: Though
R&D department is basically done
external environment but it has a
direct impact on the organization. This
aspect mainly determines the
company‘s ability to innovate and
compete.
 Marketing resources: Resources like
the organization for marketing, quality
of the marketing men, brand equity
and distribution network have direct
bearing on marketing efficiency of the
company
 Financial factors: factors like financial
policies, financial positions and capital
structure are also important internal
environment affecting business
performances, strategies and
decisions.
B. EXTERNAL FACTORS
- It refers to the environment that has an indirect
influence on the business. The factors are
uncontrollable by the business. There are two types
of external environment.
a. Micro Environment
- The micro environment is also known as
the task environment and operating
environment because the micro
environmental forces have a direct bearing
on the operations of the firm. The micro
environment consists of the factors in the
company‘s immediate environment that
affects the performance of the company.
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These include the suppliers, marketing ability to provide non-financial assistance

intermediaries, competitors, customers and etc. are very important.
the public. The micro environmental factors
are more intimately linked with the 6. Public
company than the macro factors. The micro - Public can be said as any group that has an
forces need not necessarily affect all the actual or potential interest in or on an
firms in a particular industry in the same organization‘s ability to achieve its interest.
way. Some of the micro factors may be Public include media and citizens. Growth
particular to a firm. When the competing of consumer public is an important
firms in an industry have the same micro development affecting business.
elements, the relative success of the firms
depends on their relative effectiveness in
dealing with these elements. b. Macro Environment
Following are the factors of micro environment: - Macro environment is also known as
General environment and remote
1. Suppliers
environment. Macro factors are generally
- An important force in the micro
more uncontrollable than micro
environment of a company is the suppliers,
environment factors. When the macro
i.e., those who supply the inputs like raw
factors become uncontrollable, the success
materials and components to the company.
of company depends upon its adaptability
The importance of reliable source/sources
to the environment. Some of the macro
of supply to the smooth functioning of the
environment factors are discussed below:
business is obvious.
1. Economic Environment
- Economic environment refers to the
2. Customer
aggregate of the nature of economic
- The major task of a business is to create
system of the country, business cycles, the
and sustain customers. A business exists
socio-economic infrastructure etc. The
only because of its customers. The choice
successful businessman visualizes the
of customer segments should be made by
external factors affecting the business;
considering a number of factors including
anticipating prospective market situations
the relative profitability, dependability, and
and makes suitable to get the maximum
stability of demand, growth prospects and
with minimize cost.
the extent of competition.

2. Social Environment
3. Competition
- The social dimension or environment of a
- Competition not only include the other
nation determines the value system of the
firms that produce same product but also
society which, in turn affects the
those firms which compete for the income
functioning of the business. Sociological
of the consumers the competition here
factors such as costs structure, customs
among these products may be said as
and conventions, mobility of labour etc.
desire competition as the primary task here
have far- reaching impact on the business.
is to fulfill the desire of the customers..The
These factors determine the work culture
competition that satisfies a particular
and mobility of labour, work groups etc.
category desire then it is called generic
competition..
3. Demographic Environment
- Demography is the study of human
4. Marketing Intermediaries
populations in terms of size, density,
- The marketing intermediaries include
location, age, sex, race, occupation, and
middlemen such as agents and merchants
other statistics. Changes in the
that help the company find customers or
demographic environment can result in
close sales with them. The marketing
significant opportunities and threats
intermediaries are vital links between the
presenting themselves to the organization.
company and the final consumers.

4. Political Environment
5. Financiers
- The political environment of a country is
- The financiers are also important factors of
influenced by the political organizations
internal environment. Along with financing
such as philosophy of political parties,
capabilities of the company their policies
ideology of government or party in power,
and strategies, attitudes towards risk,
nature and extent of bureaucracy influence
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of primary groups etc. The political

environment of the country influences the
business to a great extent.

5. Legal Environment
- Legal environment includes flexibility and
adaptability of law and other legal rules
governing the business. It may include the
exact rulings and decision of the courts.
These affect the business and its managers
to a great extent.

6. Technical Environment
- The business in a country is greatly
influenced by the technological
development. The technology adopted by
the industries determines the type and
quality of goods and services to be
produced and the type and quality of plant
and equipment to be used. Technological
environment influences the business in
terms of investment in technology,
consistent application of technology and
the effects of technology on markets.

7. Ecosystem Environment
- The ecosystem refers to natural systems
and its resources that are needed as inputs
by marketers or that are affected by
marketing activities. To avoid shortages in
raw materials, organizations can use
renewable resources (such as forests) and
alternatives (such as solar and wind energy)
for nonrenewable resources (such as oil
and coal). Organizations can limit their
energy usage by increasing efficiency.