Business Management

By: Dr. Rishu Jain

Introduction to management
“Management is the art of getting things done through people in formally
organized groups”- Koontz

Every human being has several needs and desires. But no individual can satisfy all his wants.
Therefore, people work together to meet their mutual needs which they cannot fulfil individually.
Moreover, man is a social being as he likes to live together with other people. It is by working and
living together in organised groups and institutions that people satisfy their economic and social
needs. As a result there are several types of groups, eg., family, school, government, army, a
business firm, a cricket team and the like. Such formal groups can achieve their goals effectively
only when the efforts of the people working in these groups are properly coordinated and
controlled. The task of getting results through others by coordinating their efforts is known as
management.
 Management is getting things done with effectiveness and efficiency. It is designing and
maintaining an environment in which individuals working together accomplish selected aims
efficiently.
 Introduction to management
• Management is a universal process. In the present era of increasing global
competition, rapid changes in technology, changes in business practices as
well as increasing social responsibility of business concerns, importance of
management has increased. Management plays an important role in the
welfare of any organization,people and the destiny of the country.
This has been rightly stated by Marshall E. Demock, “The management is
not a matter of pressing a button, pulling a lever, issuing orders, scanning
profit and loss statements, promulgating rules and regulation. Rather it is
the process to determine what shall happen to the personalities and
happiness of entire people, the power to shape the destiny of a nation and
all thenations which make up the world.
Meaning and Definitions of Management
• Meaning of Management : No organization can run successfully unless there is management. Harold Knoots
says, “Management is the art of getting things done through and with people.” It indicates that management
is the essential part of any group activity. It is important activity to control/manage men, machines, material
and money in direction towards predetermined objectives. Management is concerned with planning, policy
formulation and co-ordinating functions. It also includesquality control of product. According to E.F.L.
Brech “Management is the process of controlling the whole productive machinery.” So, management is an
important factor in the business. It is considered as important as brain in human body. Without brain human
body is only collection of bones and flesh which is of no use; likewise if management is not in business it is
only collection of money, machines, material and men which is not useful in achieving the objectives.From
the above information we can understand the meaning of management that it is the art of getting things done
by a group of people with the effective utilizationof available resources.
Levels of Management
Levels of Management
• MANAGERIAL SKILLS
• In modern business the job management has become very difficult.
Several skills are required to
• manage successfully a large organisation in a dynamic environment.
These skills of managers have
• been classified into four categories, namely technical, human,
diagnostic and conceptual skills.
 Levels of Management
• (i) Technical Skills
• Technical skills refer to the ability and knowledge
in using the equipment, technique and procedures
• involved in performing specific tasks. These skills
require specialised knowledge and proficiency in
• the mechanics of particular job. Ability in
programming and operating computers is, for
instance, a
• technical skill. There are two things a manager
should understand about technical skills. In the
first
• place, he must know which skills should be
employed in his particular enterprise and be
familiar
• enough with their potentiality to ask discerning
questions of his technical advisors. Secondly a
• manager must understand both the role of each
skill employed and interrelations between the skills.
• (ii) Human Skills
• Human skills consists of the ability to work
effectively with other people both as individual
and as
• members of a group. These are required to win
cooperation of others and to build effective work
• teams. Such skills require a sense of feeling for
others and capacity to look at things from others
point
• of view. Human skills are reflected in the way a
manager perceives his superiors, subordinates and
• peers. An awareness of the importance of human
skills should be part of a managers orientation and
• such skills should be developed throughout the
career. While technical skills involve mastery of
• ‘things’ human skills are concerned with
understanding of ‘People’.
Levels of Management

• (iii) Conceptual Skills

• Conceptual skills comprise the ability to see the
whole organisation and the interrelationships
• between its parts. These skills refer to the ability
to visualise the entire picture or to consider a
• situation in its totality. Such skills help the
manager to conceptualise the environment, to
analyse the
• forces working in a situation and take a broad
and far-sighted view of the organisation.
Conceptual
• skills also include the competence to understand
a problem in all its aspects and to use original
• thinking in solving the problem. Such
competence is necessary for rational decision-
making.
Levels of Management
OBJECTIVES OF MANAGEMENT
• (i) Organisational objectives: Management is expected to work for
theachievement of the objectives
• of the particular organisation in which it exists. Organisational
objectives include:
• (a) Reasonable profits so as to give a fair return on the capital
invested in business
• (b) Survival and solvency of the business, i.e., continuity.
• (c) Growth and expansion of the enterprise
• (d) Improving the goodwill or reputation of the enterprise.
OBJECTIVES OF MANAGEMENT
• (ii) Personal objectives: An organisation consists of several
personswho have their own objectives.
• These objectives are as follows:
• (a) Fair remuneration for work performed
• (b) Reasonable working conditions
• (c) Opportunities for training and development
• (d) Participation in management and prosperity of the enter-prise
• (e) Reasonable security of service.
OBJECTIVES OF MANAGEMENT
• (iii) Social objectives: Management is not only a representative ofthe
owners and workers, but is also
• responsible to the various groups outside the organisation. It is expected to
fulfil the objectives
• of the society which are given below:
• (a) Quality of goods and services at fair price to consumers.
• (b) Honest and prompt payment of taxes to the Government.
• (c) Conservation of environment and natural resources.
• (d) Fair dealings with suppliers, dealers and competitors.
• (e) Preservation of ethical values of the society.
CHARACTERISTICS OF MANAGEMENT
An analysis of the definition of management indicates the following features of
management:
CHARACTERISTICS OF MANAGEMENT
Importance of management
• It helps in achieving group goals
• Optimum utilization of resources
• Reduces costs
• Establishes sound organization
• Establishes quilibrium
• Essentials for prosperity of society
Principles of Management
• In the words of Herbert G.Hicks “ Principles of management are the
guiding rules of laws for managerial action”.

• Henry Fayol a french Industrialist ,offered fourteen principles of

management for the first time in 1916, during the period of 1920-40s
in the USA many authors did the hardwork in developing and testing
various principles of management.
Nature & Characteristics of POM
• Universal Appllication
• Flexibility
• General statements
• It influences human behavior
• Cause and effect relationship
• Equal importance
• Careful and discrete application
• Decision making
Importance POM
• it increases the efficiency of management

• It helps in achieving social objectives

• it generates sound understanding

• It directs the areas of training

• It guides to research work in management

Principles of Management
• Specializerestation/Division of Labor
• Authorty &Resposiblity
• Discipline
• Unity of Command
• Unity of direction
• Subordination of individual ‘s interest
• Remuneration
• Centeralization & Decentralization
• Scalar chain
Principles of Management
• Order
• Equity
• Personal Tenure
• Initiative
• Esprit de corps
 Functions of Management :
As per ‘Theo Haiman’, one of the definition is “Management as a process or group of organizational / Managerial
functions”. The list of management functionsvaries from scholar to scholar with number of functions ranging from
three to eight. Particularly ‘Luther Gullik states seven such functions; we can add one morefunction as +‘C’ to the
catchword ‘POSDCORB’ +‘C’. which stands for planning, organizing, staffing, directing, co-ordinating /
communicating, reporting, budgeting and +‘c’ indicates ‘controlling’.
The important functions of management as per the catchword ‘POSDCORB’
+‘C’ are briefly explained below:
1) ‘Planning’- ‘P’
Planning is the primary function of management All other functions are based on it. Planning is the beginning of
all managerial work. Planning determines the course of future action. It serves as a compass and shows the right
direction that an organization should take action to attain its goal. It is a blue print of future actions.Planning
means deciding in advance what to do in future. In other words it is looking ahead. Planning is performed
generally at all levels, but particularly at top level only. It is an intellectual task; which is to be carried-out
scientifically. For this every organization is following 4-‘W’ formula.
• 2) Organising – ‘O’ Planning done by manager will remain on paper only if further steps are not taken. Hence, the second
function of management process ‘organising’ should be followed. Organising means collecting/assembling factors of
production together. For this purpose organization creates order and system by bringing various elements such as capital,
machinery, materials, executive personnel, workers etc. together and co-ordinating them.
• 3) Staffing – ‘S’ Staffing involves finding the right person for the right place, allotting the right job and at right time.
Staffing also includes training to personnel to increase their efficiency and avoid waste of material and machinery.
• 4) Directing – ‘D The actual performance of a work starts with the function of Direction.
• Direction deals with making the workers learn techniques to perform the job
• assigned to them. Direction includes guidance, supervision and motivation of
• employees
Caselets
• Bhatkaav Enterprises is facing huge losses. The owner of the company is an MBA pass out.
Even then many things in the organization are happening which are indicative of lack of proper
management in the company. First of all there is no specific sharing of work and any time any
employee is asked to do anything. This has led to wastage of efforts. Further due to negligence
in proper work sharing there has been no specialization development in the nature of the jobs
done by the employees.There are no clear and fair agreements between the workers and the
management. This has led to a lot of frustration in the workers. Management has quite often
been found to be ignorant of not fulfilling promises done by it. There are also no strict rules and
regulations binding on the conduct of the workers.
Caselet 2
• In order to achieve target production of 50,000 units per month, the
Production Manager of Action Shoes Ltd had to operate on double
shifts. The workers are paid overtime charges.To earn higher wages
workers try to go slow during normal working hours andcomplete
their targets during overtime hours. Though the manager could achieve
his target and produced 5000 units but at a higher production cost.
• a. In your point of view, what is lacking in management?
• b. Identify the values missing in the production manager and the
employees of the organization.
Continued......
• The departmental heads who are the middle level managers in the
company and hold key positions always favor their relatives. They
quite often don’t turn up for job on time. They are always looking for
special relaxations from the top management. This has led to feeling
ofresentment among the employees who are also demanding special
favors and threatening strike in the coming days.
• Identify the three principles of Fayol violated in the above case.