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Chapter One: Basic Management Concept and Industrial Proudactivity
Chapter One: Basic Management Concept and Industrial Proudactivity
1
What is Management?
2
The verb manage comes from the Italian
maneggiare (to handle — especially a horse)
Which in turn derives from the Latin manus (hand)
The French word mesnagement (later ménagement)
influenced the development in meaning of the
English word management in the 15th and 16th
centuries
3
Definition of management
4
What is this little lad doing?
Do you know where he is going?
Can you see where he is going?
Do you know what could happen if he
falls in the water?
Can you really see what the
consequences are going to be?
Have you got the big picture in mind?
With anything that one does in life you
start with the end in mind. You decide
what you want to achieve and then you
decide how you will work towards
achieving it. This is what management
is.
5
manage the creative tension between current reality
and Future reality
Greatness
NOW Reality Vision FUTURE
Courage
6
So That You and Your
Followers Can Reach Our
Vision
7
In general "management" identifies a special group
of people whose job is to direct the effort and
activities of other people toward common
objectives.
Simply, management gets things done through other
people by planning, coordinating and directing the
activities of an organization
The decisions and judgments made are normally
oriented to the needs of the organization
8
Why Management?
9
Shorter
Shorter life-cycles
life-cycles for
for innovative
innovative technologies
technologies
•Water power •Steam •Electricity •Petrochemicals •Digital networks
•Textiles •Rail •Chemicals •Electronics •Software
•Iron •Steel •Internal-combustion •Aviation •New media
engine
1st Wave 2nd Wave 3rd Wave 4th Wave 5th Wave
60
60 yrs
yrs 55
55 yrs
yrs 50
50 yrs
yrs 40
40 yrs
yrs 30
30 yrs
yrs
10
What managements strives for?
'Management strives involving a group of people
work together in the most effective and efficient
manner to achieve stated goals in the best and most
economical way'.
11
Functions of management
The subject of management can be considered a
process involving certain functions that a manager
performs
1. Decision making
2. Planning
3. Organizing
4. Staffing
5. Directing
12
1. Decision making
13
Five steps of Decision making
1. Fact gathering process to lay a solid foundation for
understanding the situation
2. Recognition of the right problem
3. Generate as many alternatives as possible
4. Select the best alternative
5. Communicate the decision to others
14
2. Planning
15
Cont’d…
It is a systematic activity which determines
when, how and who is going to perform a
specific job. It is rightly said “Well plan is half
done”.
16
Cont’d…
The increased importance of planning in a business
enterprise results from various changes in the
environment like
changes in technology,
government policy,
18
Cont’d…
19
Organizing
Organizing may be defined as the structure and
process by which a group allocates its tasks among
its members, identifies relationships and integrates
its activities toward common objectives
20
Cont’d…
The organizing function of management brings together
human and physical resources in an orderly manner and
arranges them in coordinated pattern to accomplish
planned objectives.
Each organizational resource (human, material, finance
etc.) represent an investment from which the
management system must get the return. Therefore,
these resources should be organized properly for
efficient and effective use of the same.
21
Cont’d…
A sound organization is necessary because it brings many benefits to the
management of an enterprise. Some of the benefits are:
Good communication between the management and employees,
Sound basis to evaluate the performance of individuals and groups,
Well defined areas of works for each employee,
Coordination of activities of various individual, groups, etc.,
Effective delegation and decentralization,
Adequate and effective control,
Difficulty in empire building in any segment of the enterprise, and
Stimulation of independent, creative thinking and initiative on the part of
the employees.
22
Cont’d…
the
steps that are important when
organizing an enterprise
Reflection on plans and objectives,
Establishing major tasks,
Dividing major tasks into subtasks,
Allocating resources and directives for subtasks,
and
Evaluating the result of implemented organizing
strategy.
23
Cont’d…
Reflecting on
plans and
objectives
Evaluating
results for Establishing
organizing major tasks
strategy
Allocating
Dividing major
resources and
tasks into
directives for
subtasks
subtasks
24
Staffing
Staffing deals with the workers and is worker-oriented
This function includes the process of placing the right
person in the right organizational position
The process of matching the people and the jobs is done
by careful preparation of specifications necessary for
positions and raising the performance of personnel by
training and retraining of people to fit the needs of the
organizational position
25
Controlling
Control is the process that measures current
activities, quantitatively if possible, and guides it
toward some predetermined goal, plan, policy,
standard, norm, decision rule and criterion or
yardstick.
The essence of control lies in checking and
correcting actions against desired results in the
planning process
26
Cont’d…
Controlling includes ensuring that employees perform
the work allocated to them in the ways laid down, and
with no wastage or duplication of time, effort or
materials.
That involves much more than simply instructing a
given number of employees to perform work; they
must be supervised and managed so that their efforts
achieve the desired results.
This requires that they are motivated, checked,
guided, taught and encouraged.
27
Communication
It serves as a linkage by which the other functions
explained are tied together
There are three types of communications in an
organization
1. Organization charts show the flow of authority and the channels
through which the vertical and downward communication flows
2. Horizontal type whereby, managers on the same level of an
organization coordinate their activities without referring all matters to
their superior
3. The informal type
28
29
Directing
For the same idea, different organizations use different
terms such as
Leading
Executing
Supervising
Ordering and
Guiding
What ever terms are assigned to it, the idea of directing is
to put into effect the decisions, plans and programs that
have been worked out.
30
Management Roles
Role
A set of expectations of how one will behave in a given
situation.
Management Role Categories (Mintzberg)
Interpersonal
Figurehead, leader, and liaison
Informational
Monitor, disseminator, and spokesperson
Decisional
Entrepreneur, disturbance handler, resource allocator, and
negotiator
31
Ten Roles Managers Play
32
Differences Among Managers
The Three Levels of Management
Top managers
CEO, president, or vice president
Middle managers
Sales manager, branch manager, or department head
First-line managers
Crew leader, supervisor, head nurse, or office manager
Individual Contributors (ICs)
Non-management operative employees
Workers in the organization who are supervised by first-line
managers.
Professionals/Specialists/Technicians (Knowledge Workers)
33
Types of Managers
General Managers
Supervise the activities of several departments.
Functional Managers
Supervise the activities of related tasks.
Common functional areas:
Marketing/Sales/Product Development
Operations/Production/Services Delivery
Finance/Accounting
Human Resources/personnel management
Infrastructure (IT, Real Estate, Legal)
Project Managers
Coordinate employees across several functional departments to
accomplish a specific task.
34
Management Skills and Functions
Planning
Controlling Organizing
Leading
35
Cont’d…
36
Personal Qualities Needed for Managerial Success
Some of the more important personality traits of a successful
manager are the following:
38
Cont’d…
1. Defining as accurately as possible the problem which needs to be
solved.
2. Obtaining all relevant information about the problem
3. Breaking down the problem into parts − very often the solution
to one part is obvious and leads, logically, to the solving of other
parts or the whole problem.
4. Comparing and judging the probability of success of any possible
different solutions to the same problem, and their possible
consequences on other areas.
5. Selecting the most attractive solution − making the decision
39
Cont’d…
The Ability to Use Initiative: from time to time a manager is
bound to come across problems or situations which are outside his
range of experience
In such circumstances, particularly if action is urgently needed, the
manager must not simply leave the matter until his senior is
available or wait to be told what to do, but must initiate - that is,
lead the action without waiting to be prompted.
40
Cont’d…
Ability to Handle Conflict: A good manager is calm, able to
listen, is positively responsive to criticism and is able to handle
conflicts and differences in a constructive manner.
In order to handle conflicts well, a manager must be confident,
self-assertive, fair and dominant.
He should be highly tolerant of stress, as conflicts generally lead to
stress and tension.
This would require a sound mind in a sound body.
41
Cont’d…
Ability to Adapt Change and be Flexible: Any manager must be
able to adapt to changes and, if necessary, to cope with changed
circumstances, and ensure that his subordinates also do so.
Adaptability to different situations and flexibility of mind are also
necessary in the routine, day-to-day running of a section,
department or an entire enterprise.
42
Cont’d…
Ability to Be Emotionally Stable:
He must be able to keep control over his own emotions and his
temper whatever may the provocation be, and be able to
concentrate his attention on the matter in hand, thinking clearly,
logically, and avoiding hasty reactions.
43
Cont’d…
Stamina and Concentration: mental fitness to work long and
hard without undue stress or strain.
Besides mental alertness, a manager needs to be able to concentrate
his mind on the matter in hand even under the most tiring
circumstances and/or when he is under pressure
44
Cont’d…
45
Cont’d…
Leadership: Leadership is the ability of a person to exert a
positive influence over the thoughts, behavior and actions of
others, and then to direct their thoughts, behavior and actions
towards a common goal or objective.
46
Organization Structure
planned organizational structure must not be overlooked
in the establishment of a new business.
The stages in the setting up of an effective organizational
structure are
The activities which will be necessary to achieve the objectives
of the business must be established.
The various related activities should be grouped together into
departments; the most logical grouping is by 'function', that is,
by type of activity: production, marketing, finance, etc.
The activities of a particular department will be further divided,
and grouped together into sections;
47
Cont’d…
An organization chart should be produced to depict the
proposed organization
Based on estimates of the volume of work, which will be
performed by each section, the number of staff required must
be determined.
48
Cont’d…
The special knowledge or talents required by departmental
and sectional managers must be laid down.
The equipment necessary for the proper functioning of
each section and department must be decided upon, and
provision made for its positioning when considering the
layout of the accommodation for each unit.
To ensure effective coordination of all parts of the
enterprise, effective procedures and systems of
communication must be devised and installed.
49
Types of Organizational Structure
There are four different types of organizations, namely
I. line,
II. functional,
50
I. Line Organization
sometimes called 'military organization', because it is how
the armed forces are organized.
there is a clear 'line' of responsibility and authority right
through the management structure from the board to the
lowest level of supervision, and below.
51
Cont’d…
Line organization is simple and direct and is easy to
understand.
• The 'chain of command‘ is direct and so decisions can usually
be made quickly and implemented rapidly, because of the
directness of the control, the coordination of the activities of all
those employed in a department is simplified.
The position (and status) of all the different people working in
a department can be easily seen, and so the extent of their
responsibilities, authority and duties can, be clearly defined
and understood, making disputes less likely.
52
Cont’d…
53
II. Functional Manager
it is the function (the type of activity), which determines
the areas of authority and responsibility.
An expert or specialist is placed in charge of each
function, and will have direct control of that function
wherever it is undertaken within the enterprise.
54
Cont’d…
As the functional specialists are not involved in the day-to-
day running of the enterprise (which is the domain of the line
managers) they are free to the concentrate on their particular
functions that produce many benefits for the enterprise.
However, this form of organization makes control difficult as
there are no clear lines of authority and it is similarly difficult
to establish responsibility when things do not go right.
Furthermore, staff as well as supervisors and junior managers
become confused at being subject to the authority of more
than one superior.
55
Cont’d…
56
III. Line and Staff Organization
In such a structure, the line managers control the primary
functions, such as marketing and production, which are
directly concerned with achieving the objectives of the
business;
whilst the staff managers are generally involved with
secondary functions which assist the smooth and efficient
running of the primary functions.
57
Cont’d…
MANAGING DIRECTOR
DIRECTOR
L L
L SECTION SECTION MANAGERS SECTION
MANAGERS SUPERVISORS & MANAGERS
SUPERVISORS & SALESMEN SUPERVISORS &
OPERATORS CLERKS
S EMPLOYMENT S TRAINING
OFFICER OFFICER
L – Line relationship: S – staff relationship
Responsibility and authority shown by
. SUPERVISORS SUPERVISOR
Staff. Advisory relationship shown by & CLERKS S
--------------- & CLERKS
58
IV. Matrix Organization (Project Organization)
These are temporary organizational structures formed for
specific projects for a specific period of time and are
dismantled, once the required goal is achieved.
A typical example for this kind of organizational structure
can be the goal to design
The specialists are selected primarily on the basis of task-
related skills and expertise rather than decision making
experience or planning ability.
59
Cont’d…
These structures are very useful when:
The project is clearly defined in terms of objectives to be
achieved and the target date for completion of the project.
The project must be separate and unique and not be a part of
daily work routine of the organization.
There must be different types of activities which require skills
and specialization and must be coordinated to achieve the
desired goal.
The project must be temporary in nature and not extended into
other related projects.
60
Cont’d…
This kind of organization occurs frequently in:
Construction ( e.g. building a bridge)
Aerospace engineering ( i.e. designing and launching
weather satellite)
Marketing( e.g. advertising company for new product)
Installation of an electronic data processing system, etc.
61
Cont’d…
General
Manager
Project A Manager
Project B Manager
Project C Manager
62
Cont’d…
In matrix organization, it is possible for the individual
employee to have two managers. However, proponents of
matrix organization believe that it provides an agency
with the flexibility to work on critical projects.
Matrix organization also brings together the specialized
talent that is often necessary to complete a project
63
Cont’d…
Other advantages of matrix organization:
Decision making is decentralized to a level where information
is processed properly and relevant knowledge is applied.
Extensive communications networks help to process large
amount of information.
With decisions delegated to appropriate levels, higher
management levels are not over loaded with operational
decisions.
64
Cont’d…
Resource utilization is efficient, because key resources are
shared across several important programs or products at
the same time.
Employee learns the collaborative skills needed to
function in an environment characterized by frequent
meeting and more informal interactions.
65
Cont’d…
disadvantages include:
Reporting for two supervisors which creates confusion
The design encourages managers who share subordinate to
jockey for power.
The mistaken belief can arise that matrix management is the
same thing as group decision making − in other words every
one must be consulted for every decision.
Too much democracy can lead to not enough action.
66
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