1

CHAPTER ONE: MANAGEMENT AN OVERVIEW

Definition of Management and Managers
Management is the process of coordinating all
resources through the five major functions of
planning, organizing, staffing, directing /leading and
controlling to achieve organizational goals/desired
objectives.
It is concerned with productivity: effectiveness and
efficiency.
 2

Cont…
It is the utilization of scientifically derived principles to examine
and improve collective efforts or production.
It is the process of achieving organizational goals through
engaging in the five major functions of planning, organizing, leading,
staffing and controlling.
Managers: are those persons in the position of authority who make
decisions to commit (use) their resources and the resources of
others towards the achievement of organizational objectives.
 3

Managerial Functions
Common managerial functions are planning, organizing, staffing,
directing/leading and controlling.
PLANNING is making decisions today about future actions.
It involves selecting missions and objectives it requires
decision making.
That is, choosing future courses of action from among
alternatives.
ORGANIZING: isassembling the resources necessary to
achieve organizations’ objectives and establishing the
activity authority relationship
 4

Cont…
STAFFING: Staffing involves filling and keeping
filled the positions in the organization structure.
Directing/leading: is motivating, influencing, guiding,
stimulating, actuating or directing.
CONTROLLING: is the measuring and correcting of activities of
subordinates to ensure that events conform to plans.
 5

Significance of Management
There are different reasons to study management. These are:
It is important for personal life .
Management is universal: managers work in all types of
organizations, at all levels, and in all functional areas.
It affects the accomplishment of social, economic, political and
organizational goals.
Management is needed to coordinate and direct the efforts of
individuals, groups and the entire organization to achieve desired
objectives.
 6

Levels Of Management
Managers can be divided based on two criteria. These are:
A.Levels of management (vertical difference)
B.Scope of responsibilities (horizontal difference)
Types of Managers based on levels of management
An important determinant of a manager’s job is hierarchical level.
Levels refer to hierarchical arrangement of managerial position or
persons in an organization. The number of managerial
levels in an organization depends on the size of the
organization.
 7

Cont…
Top Level Managers: Top-level managers are managers who are at
the top of the organizational hierarchy and are responsible for the
entire organization. E.g. CEO, president & vice-presidents
Middle Level Managers: They interpret and implement top
management directives and forward messages to and from first-
line management.
First Level /Supervisory Level managers
Are those at the operating level or at the last level of management.
They are responsible for overseeing and coordinating the work of
operating employees.
 Who is a Manager?
Someone who coordinates and oversees the work of other people so that
organizational goals can be accomplished

© 2007 Prentice Hall, Inc. All rights reserved. 1–8

 9

Managerial Roles
Henry Mintzberg identified 10 managerial roles which are in turn
grouped into three categories: Interpersonal, Informational and
Decisional Roles.
 10

Cont…
1. Interpersonal Roles:
developing and maintaining positive relationships. It includes:
Figurehead Role: managers perform symbolic duties of a legal or social
nature. e.g. Signing documents, presiding at a ceremonial event, etc….
Leadership Role: manager is the environment creator
is responsible for hiring, training, motivating and encouraging employees/
subordinates.
Liaison Role: maintains a network of contacts outside
2.Informational Roles- focuses on the transmission of important
information
It involves the following activities:
 Monitor role:seeks internal and external information about issues that
can affect the organization.
 Disseminator Role: disseminate to subordinates, superiors
Spokesperson/representative Role: the spokesperson transmits
information about the organization to outsiders.
 11

Cont…
3. Decisional Roles: involve making significant
decisions that affect the organization.
Entrepreneur Role: (initiator of change) recognizes
problems and opportunities.
Disturbance Handler Role:solution seeking role .
TheNegotiator Role: representing the organization in all
important/major negotiations.
 12

Managerial
Technical Skills – Skills and Their Relative Importance
involve process or technique, knowledge and proficiency.
 It is the ability to use the tools, procedures, or techniques
of a specialized field e.g. engineering, manufacturing, …
Human Relations or Interpersonal Skill
Ability to interact effectively with people
to work with, understand and motivate other
people
Conceptual skills
involve the formulation of ideas
Ability to see the big picture
 13

Cont…
Conceptual skills are more important in strategic (long
range) planning; therefore, they are more important to top-
executives than middle managers and supervisors.
example : Idea generation and analytical process of information
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 15

Management: Science or Art?

Science is making conclusions based on actual facts and verifies
knowledge through cause-effect relationship.
Art is characterized by using common sense, personal feeling,
beliefs, impulses, etc. It is know-how, skill
Thus, management as a practice is an art;the organized knowledge
underlying the practice may be referred to as a science .
 16

Universality of Management
Regardless oftitle, position, or management level, all managers do
the same job. They execute the five managerial functions and work
through and with others to set and achieve organizational goals.
Managers are the same whether the organization is private or public,
profit making or non-profit making, manufacturing or service giving,
and industrial or small firms. Hence, management is universal for the
following reasons.
All managers perform the five managerial functions
Management utilizes scientifically derived operational principles.
All managers operate in organizations with specific objectives.
•In sum, management theories and principles have universal application in all
kinds of organized and purposeful activity and at all levels of management.
 17

END OF CHAPTER ONE!

GOOD LUCK!!!
 Chapter 2: Planning Function
Planning –making decisions today about future actions; and it is
a selection or choice among alternatives .
It is determining the objectives and formulating the methods to achieve
them.
A job well planned is half done.

It is deciding in advance what to do, how to do it, when to do it

and who is to do it.

It bridges the gap from where we are to where we want to go.

It makes it possible for things to occur which would not

otherwise happen”
 19

Cont…
• Planning answers six basic questions in regard to any intended
activity:
• What (the goal or goals).
• When (the time frame in which it will be accomplished)
• Where (the place or places where the plans or planning will
reach its conclusion).
• Who (which people will perform the tasks).
• How (the specific steps or methods to reach the goals).
• What resources (resources necessary to reach the goals).
 3

Reasons for Planning

• To coordinate human resource
• To reduce uncertainty in operation
• To reduce overlapping and wasteful activities
 Nature /Features of planning
a. Planning seeks to achieve certain objectives-
the purpose of any plan is to facilitate the
accomplishment of organizational objectives
b. The primacy of planning
planning precedes the execution of all other managerial
functions.
c. The pervasiveness /Universality of planning
Planning is a function of all managers
 22

Cont…
• Planning is a continuous process
Due to full of uncertainties, planning is subject to revision.
Planning is a means to an end
Planning is not an end by itself. It is a means to an end
(meeting objectives).
Plans are arranged in a hierarchy
Plans are first set for the entire organization. corporate plan
then provides the framework for the formulation of
divisional, departmental, and sectional goals.
Planning and information
Basically no plan exists without information. To plan
managers have to gather relevant information from
around the environment.
 Advantages VS limitation of Planning
Advantage Limitation

• It focuses on desired Lack of accurate

objectives information
• minimize risks ‘’answers Time consuming
what if questions’’
• It avoid confusions Expensive
• It uses utilization of resources
Planning is risky b/c of
uncertainties (absence of
accurate data)
• It encourage innovation and creativity

• It enables co operation and group work

Types of plan
 25

Characteristics of a Good Plan

Objectivity: Planning should be factual, logical and realistic
Futurity: Since a plan is a forecast of some future action
Flexibility: They must adjust smoothly and quickly to
changing conditions
Stability: it should not be changed materially from day to day.

Comprehensive: Should provide adequate guidance

Simplicity and clarity: It should not be ambiguous. Lack of
clarity makes understanding and implementation difficult.
 26

CHAPTER THREE
MANAGERIAL DECISION MAKING
Meaning:- Decision-making is a rational choice or selection
of one alternative from among a set of alternatives; i.e. it
is the act of choosing one alternative from among a set of
alternatives.
Decision-making is the management function that
consists of choosing one course of action from all the
available alternatives.
Even though in all managerial functions decision-making is
involved, the critical decision-making is during planning because
planning identifies the objectives of the organization; i.e. decision
must be made to identify the objectives/missions of an
organization.
In the planning process, managers decide such matters as what
goals or opportunities their organization will pursue, what resources
 27

..Continued….

• Decision-making has three elements (parts)

When managers make decisions; they are choosing or

selecting from among alternatives.
When managers make decisions, they have available
alternatives. When there are no alternatives, there is no
decision-making, rather it become mandatory.
When managers make decisions, they have purpose in
mind. The purpose in mind is organizational objectives
 28

Con’t…
THE DECISION-MAKING PROCESS
The process is a sequential process rather then a series of steps.
1.Identifying problems: If problems do not exist, there will be no need for
decisions; i.e. problems are prerequisites for decisions.
To locate problems, managers rely on several different indicators: Deviations from
past performance, Deviation from plan and Out side criticism.
2. Developing Alternatives: via brainstorming or Delphi technique.
3. Evaluating Alternatives
Once managers have developed a set of alternatives, they must evaluate them to
see how effective each would be.
4. Choosing an Alternative: The purpose is to solve the problem 5. 5.
Implementing and Monitoring the Chosen Solution
 29

Decision-Making Conditions
1. Decision-making under Certainty
The external conditions are identified and very predictable; i.e. we are
reasonably sure what will happen when we make a decision.
2. Decision-making under Risk
The likelihood of its occurrence and its potential payoffs and costs
are associated with probability estimates.
managers may have factual information, but it may be incomplete.
E.g. tossing a coin, metrology
3. Decision-making under Uncertainty
Decision makerdoes not know what all the alternatives .
is the most ambiguous and there is high chance of making poor
decisions.
Reliance on experience, judgment, and other people's experiences
 30

CONT…
Types of Decisions
1. Programmed Decisions - made in routine, repetitive, well-
structured situations through the use of predetermined decision
rules.
The decision rules may be based on habit, computational techniques,
or established policies and procedures.
2. Non-programmed Decisions
used to solve non-recurring, original, and unstructured problems.
No well-established procedure exists for handling them, because it
has not occurred before
Because of their nature non-programmed decisions usually involve
significant amounts of uncertainty. `
 31

UNIT FOUR: ORGANIZING FUNCTION OF

MANAGEMENT
Organising
• According to Henri fayol “To organize a
business means to provide it with
everything useful to its functioning-raw
materials, tools, capital and personnel”
 Organizing - is a management function that
involves arranging human and non-human
(physical) resources.
The end result of an organizing process is an
organization.
Organization - is the total system of social and cultural
relationship among peoples who are joined together to
achieve some specific common objectives.

© 2007 Prentice Hall, Inc. All rights reserved. 1–33

 Steps in organising

•Identification of objectives: the activities required

for achieving objectives.
•Classifying these activities in to convenient
groups
•Assigning/ Grouping the group of activities to
appropriate persons to form Department.
•Delegating authority and fixing responsibilities.
•Coordinating Authority Responsibility relationship
throughout the enterprise.
Importance of organising
 36

Types of Groups in the Informal Organization

Horizontal Groups
Include persons whose positions are on the same level
Vertical Groups
Include people on different levels organizational hierarchy.
Mixed Group
It is a combination of two or more persons whose positions
are on different levels of the formal organization and in
different work areas.
 37

Types of Organizations
1. Formal organization: isintentional, deliberate or rational
structure.
 It is characterized by well-defined authority, reporting
relationships, job titles, policies, procedures, & specific
job duties.
2. Informal organization
 It is a network of personal and social relationships that
arises spontaneously as people associate with one
another in a work environment.
 It is an unofficial network of personal and social
relations.
 It operates outside formal authority relationships..
 38

Why people form informal groups?

1. Need for satisfaction:
People have needs that in some cases are not met
through the formal organization. E.g. fulfill security,
relationship, & esteem
2. Proximity and interaction:
frequent interaction.
3. Similarity:
Several persons with the same attitudes or beliefs,
similarity can be personality, race, gender, economic
position, age, educational background etc.
 39

Major Elements of the Organizing Function

i: Division of Labor:
The degree to which the grand task of the organization is
broken down and divided into smaller component.
ii: Job description: is an account of activities what the sub-
task performer is expected to perform and the associated
authority and responsibility relationships among jobs.
 40

Cont…
Advantages of Division of Labor
performing a task to become highly proficient in a relatively
short time
Decreased transfer time.
Less wastage of materials in the learning process including
time.
Disadvantages of Division of Labor
Boredom and fatigue caused by monotonous, repetitive
tasks because the work becomes less challenging.
Specialization would result in workers' having limited
knowledge .
Specialization sometimes causes workers to think more in
 41

Departmentation: Meaning and Bases

Departmentation:
 It is process of grouping specialized activities in a logical
manner.
Department - is a distinct area (Unit), division, or branch of
an organization
Bases for Departmentation.
Common bases are function, territory, product, customer &
process.
 42

1. Departmentation by Function
 It is thegrouping together of activities on the basis of
similarity of expertise or work activities.
E.g. Human resources, production, marketing, finance, etc.
2. Departmentation by Territory/ Geography

This is to groups activities on the basis of geographic

region or territory .
 It is common in enterprises that operate over wide
geographic areas.
3. Departmentation by Product (Line)
 It is thegrouping and arrangement of activities around
products or product groups.
 E.g. Petroleum refining - kerosene, diesel, Electronics -
Radios, TVs, Computers.
 4. Departmentation by Customer
•It is a grouping of activities around
customers.
•Based on demands, preferences, and needs .
5. Departmentation by Process
Manufacturing firms often group activities
around a process or type of equipment .
6. Departmentation on Combined Base
It is a base in which multiple bases are used at
different organizational levels of a particular
organization.
Delegation of Authority
Authority - is the right to commit resources, or the
legal (legitimate) right to give orders .
Delegation of Authority
is the downward pushing of authority from
superiors to subordinates.
 45

The Process of Delegation

Delegation of authority has the following steps:
1. Assignment of tasks
2. Delegation of authority
The subordinate to complete the duties the authority
necessary to do them should be delegated by manager to
subordinate.
3. Acceptance of responsibility
Responsibility is not delegated by a manager to an employee, but the
employee becomes obligated when the assignment is accepted.
4. Creation of accountability
Accountability has to answer to someone for your results or actions. It
means taking the consequences - either credit or blame. It is the
requirement to provide satisfactory reasons for significant deviations
 46

Importance of Delegation
1. It relieves the manager from his/her heavy workload:
Delegation frees a manager.
2. It leads to better decisions: Since subordinates are
closer to real activities and problems than superiors, they
have more realistic information and better understanding.
3. It speedup decision-making: decreasing layers of mgt.
4. It helps subordinates to train and builds moral:
Subordinate managers can reach their full potential only if
given the chance to make decisions and to assume
responsibility for them.
 Factors Determining Delegation
i. The history and culture of the organization: Whether authority will
be decentralized frequently depends upon the way the business has
been built.
ii. The nature of the decision: The expensive and the riskier the
decision is, the more centralized the authority will be.
iii. Availability and ability of managers (Lower level managers):
quantity and quality of lower level (subordinates)
iv. Management philosophy: The willingness of managers to delegate
v.Size and character of the organization:
The larger the organization, the more decisions to be made
vi: Geographic dispersion of operations:
Geographic dispersion of operations makes decentralization more
necessary
Vii:Environmental uncertainty:
Environmental uncertainty tends to produce a need for more
decentralization.
 48

Authority Relations in Organization (Line, Staff, Functional)

i. Line Authority
LA is superior and subordinate type.
It is a direct supervisory relationship.
ii. Staff Authority - is advisory in nature.
is to give advice, e.g. expertise, technical assistance, and support to
help line managers
SA doesn’t provide any basis for direct control over the subordinates.
iii: Functional authority
They are usually composed of specialists & they are
functional controller.
is not restricted to managers of a particular type of
department.
e.g. The Finance Manager can give direct command to the
 49

Span of Management
SM also referred to as a span of control, span of
supervision, span of authority or span of responsibility.
It refers to the number of subordinates who report
(Supervised) directly to a manger.
i. Narrow Span of Management
This means superior controls few numbers of
subordinates
1. Tall organization structure with many levels of supervision
2.More communication between superiors and subordinates.
3. Managers are underutilized and their subordinates are over
controlled.
4. More trained managerial personnel and centralized
authority.
50
 51

Organizational Structure
 OS is the arrangement and interrelationship of the
component parts, and positions of an organization.
 Thehorizontal dimension identifies departments, units,
and divisions on the same level of a management.
vertical dimension refers to the authority relationships
between superiors and subordinates.
 Organizational Chart
Organization chart is a line diagram that depicts the broad
outlines of an organization’s structure.
The organization chart can tell us:
Who reports to whom (chain of command)
The number of managerial level
How many subordinates work for each manager (the span of control)
How the organization is structured-by function, territory, customer.
The hierarchy of decision making- where a decision maker for a
problem is located
 54

CHAPTER FIVE
STAFFING FUNCTION
 Staffing
• It is concerned with the Human resources of the enterprise.

• The major objective of the staffing function is enabling an

organization to attract, maintain and utilize efficient and effective

workforce.
Functions of Staffing
Acquisition (Procurement)
determining and obtaining the proper quality and quantity
of the workforce.
Human resource planning: It is the process of determining
and preserving recruitments.
Recruitment: process of searching for prospective
 56

Selection: It is the process of evaluating qualified

candidates based on their abilities, skill and
performance.

The selection process may include: preliminary

screening; application form filling; reference letters;
mployment interview, employment tests & physical
examination.
 57

Induction (Orientation): Placement & selected

candidates are familiarized with the organization.
Retention: selected employees are maintained or
utilized. It includes the following elements.
Training and development:
Training is increasing aptitudes, skills and
abilities of employees
It is mainly given to non - managers to improve
their technical skills.
it is aim to improving current job performance
 58

Development
is the systematic process of education, training and
growing information, knowledge, skills, attitudes and
perceptions of employees
It seek to develop skills for future jobs.
Compensation:
It is adequate and equitable remuneration of
personnel for their contributions.
Performance appraisal (PA):
Evaluating actual job performance Vs designed standards
 59

Discipline: Taking remedy action when employees

violates policies
Such as warning, criticism, probation, suspension,

disciplinary transfer, demotion, and discharge until

the problem is solved or eliminated.
 60

CHAPTER SIX: DIRECTING

 61
Directing : is the process of integrating the people
to obtain their willing & enthusiastic
To actuate or direct the behavior of individuals a manager
requires three basic skills:
leadership Skills
Motivational skills
Communication skills
Leadership
Leading is the function of management to influence the people
ability of a manger to influence subordinates
to use different forms of power
Managers lack the motivational skill of leader.
Therefore a manager is not necessarily a leader. In terms
of scope, management is broader than leadership.
 Leadership Theories
Is the systematic study of personal characteristics
1. Trait theory:
Traits are distinctive internal or personal qualities
Physical: like height, weight, appearance, health, etc.
Personal: like self-confidence, dominance,
adaptable, extroversion/sociability, originality etc.
Mental: like intelligence, creativity, knowledge,
technical competence etc.
The trait approach focuses on qualities, which leaders
should possess. It classifies human beings into leaders and
ollowers.
 63

2. Behavioral approach (The Two Dimensional

Theories):
It doesn’t answer” who are effective leaders”’
but answers ‘’what do effective leaders do that
ineffective ones do not do’’
3. Contingency approach
Reveals there is no one best way to lead

effective leadership depends upon the response to

environmental factors accurately.

 64

Douglas McGregor has hypothesized two sets of assumptions about

people: These are Theory X and Theory Y Assumptions.
Theory X – pessimistic and negative:
Impose a directive leadership style Coercion, negative motivation,
and refusal to allow employee participate in decision-making.
Because of:
The average human being has an inherent dislike of work
Because of this dislike, most people must be coerced
The average human wishes to avoid responsibility so need to
directed
Theory Y- adopts a developmental approach & positive approach
Leader will prepare him/herself to work with people (Subordinates)
The assumption is :
The average human being does not inherently dislike work.
External control and threat of punishment are not the only means for
bringing about effort toward organizational objectives.
Leadership Styles

6
 Autocratic Leadership
• Classical style
• Manager retains power and decision-making authority.
• Make unilateral decision, dictate work methods.
• Orders are issued to be carried out, with no questions
allowed and no explanations given.
• It is best applied to situations where there is little time
for decision-making or where the leader is the most
knowledgeable person of the team.

7
 Democratic Leadership
• Participative style
• Encourage employees to involve in decision making.
• Let employees determine the work methods and use
feedback as an opportunity for helpful coaching.
• Employees feel engaged in the process and are more
motivated and creative.
• It is best applied where the staff know the job well and
don’t require too much instruction (flexibility).

8
Bureaucratic Leadership
• Everything must be done according to procedure or
policy.
• The company operates in a rational manner rather
than relying on the feelings of the managers.
• It is best applied to situation where employees are
working in dangerous environment that requires a
definite set of procedures to operate.

9
Laissez-faire Leadership
• “hands-off” style (Distant, detached)
• Manager provides little direction and gives
employees freedom to make their own decision at
work.
• This style can be effective where employees are
highly qualified in an area of expertise.

10
 70

4. MOTIVATION
The Concept of Motivation
Motivation is an internal force that energizes behavior, gives
direction to behavior, and underlies the tendency to persist.
Because motivation is an internal force, we cannot measure the
motivation of others directly.
A motivator is something that influences an individual’s
behavior.
The Motivation Cycle
The starting point is a need or a deficiency or a state of felt that
causes tension on (physiological or psychological in balance) that
cause certain wants motivating the individual to some kind of goal
directed behavior.
71
 72

Motivation Vs Satisfaction
Motivation refers to the drive and effort to satisfy a want or
a goal. Satisfaction refers to the contentment experienced
when a want is satisfied. In other words, motivation
implies a drive toward an outcome, and satisfaction is the
outcome already experienced.

M otiv ation R esults Satisfaction

 73

Motivation and Performance

Motivation and performance are assumed to be one and
the same.
Performance = Ability x Motivation x Environmental
conditions
Theories of Motivation
a. Carrot and Stick Approach
This symbol relates the use of rewards and penalties in order to
induce desired human behavior.
It comes from the old story that to make a donkey move one must
put a carrot in front of it and if it does not move beat it with stick
from behind.
Reward and punishment are still recognized/considered
by strong motivators .
 74

b. Money as a Motivator
Money it is used as a motivator (motivating factor) but not the
only one.
Used under the following conditions.
For people who have low-level standards of living and who badly
need it for their life.
When the amount is so significant
When the payment is so differentiated
c. Maslow’s Need Hierarchy
One of the most widely mentioned theories of motivation
The hierarchy of needs is based on four premises:
Only an unsatisfied need can influence behavior
A person’s needs are arranged in a priority order
As the person’s needs are met on one level, advances to the next
level
If it is not maintained it will become priority need again
 75

Maslow’s Need Hierarchy

Self-actualization: Need for fulfillment

Esteem Needs: recognition by others

self respect

Social (Love or affiliation)

Safety (Security): freedom, job security

retirement etc.

Psychosocial Needs: food, water, air,

shelter
 76

d. Herzberg’s Two Factor Theory

a. factors that produce job satisfaction as
motivators .
these factors are directly related to job content.
b.hygiene's (factors led to job dissatisfaction)
related to work setting, or job context, than to job
content
77
 78

CHAPTER SEVEN
THE CONTROLLIG FUNCTION
Controlling is the process through which managers
assure that actual activities conform to planned activities.
It is checking current performance against
predetermined standards contained in the plans.
IMPORTANCE OF CONTROLLING
is an essential part of effective organizational management.
 Adapt to changing conditions, limit magnification of errors and
provide the means to monitor performance.
Controlling is the process of evaluating and correcting
individual performance to ensure that outcomes conform
to the standard set before.

3
 Control Process – Step 1
Establishing Standard
•Standard must be reasonable and achievable.
•Ideal standard which is unachievable may
frustrate employees and cannot help achieve the
standards set.
•Low standard which is too easy to achieve
cannot make improvement for company’s
operation.

4
 Control Process – Step 2
Measuring Actual Performance
• For a given standard, manager must decide
how to measure actual performance.
• Setting control criteria:
 Company  Employees
• Sales • Satisfaction
• Costs • Turnover
• Output • Absenteeis
m

• Sources of data:
• Observation
• Statistical reports 5
Control Process – Step 3
Comparing Actual Performance
with Standard
• Compare the actual performance against the
standards based on the control criteria and identify
the deviations, if any.
• Deviations are noted if:
• Actual performance below the standard.
• Actual performance above the standard.

6
Control Process – Step 4
Taking Corrective Action
• If no deviation or deviation is insignificant, no
action is required.
• Otherwise, take corrective actions such as
changing the existing strategy, employees’
remunerations, training etc., OR
• Revise the standard if it is not realistic, fair and
achievable.