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Chapter 1

ESSENTIALS OFMANAGEMENT

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Learning Objectives

To understand the role of organizations inmodern soieties

To appreiate the importane of

management for organizations To understand differene !et"een

effiien# and effeti$eness To omprehend generi funtions of

management

To learn a!out different managerial roles To appreiate different t#pes of managerial

s%ills and their importane at differentle$els of organization

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&ole of Organizations in Modern

Soieties

In Modern times it is appropriate thatTerm'Mar%et Eonom#( !e replaed !# term

'Organizational Eonom#() Herbert Simon *ositi$e assoiation !et"een prosperit# of an

Eonom# and &ole of Companies) SumantraGhoshal

Companies engender +alue)Creation through&esoure Com!ination and E,hange thatmar%ets alone an not do

Companies ha$e -istint apa!ilit# to Share.Transfer. S#nthesize and Create /no"ledge o$erMar%ets

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Effiien# and Effeti$eness

Effiien# refers to ' -oing Things &ight(

Effeti$eness refers to '-oing the &ightThing() *eter -ru%er

Effiien# is onerned "ith getting mostoutput out of sare resoures 0Capital.uman &esoure. &a" Material et23

Effeti$eness is ahie$ed !# setting right

organizational goals2 No amount ofeffiien# an ma%e up for la% ofeffeti$eness2

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'MANAGEMENT4 +ariousl#5nderstood666

Specific OrganOf an Organization thathas the responsi!ilit# to deli$er resultsonsistentl#

Processthat dri$es an Organizationto"ards its *erformane

People"ho ha$e authorit# to *lan.Organize. Lead and Control different

Organizational ati$ities Applied Discipline

Profession or a career

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Generi Funtions of Management

Managerial 7o!s are haraterized !#+ariet#. Fragmentation. 8re$it# andOral ommuniation "ith se$eral

people2 First "ritten a!out !# enri Fa#ol and

later ela!orated !# L#ndall 5r"i%.Classial Management funtions are9) *LANNING O&GANI:ING LEA-ING CONT&OLLING

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Management Funtions

enri Mintz!erg alled these funtions as'fol%lore(2 e for"arded &ole theor# ofManagerial "or%2

arold /oontz defends Fa#ol;s approah As managerial work is largely cerebral and

not directly observable.

Further it allows us to look at universal

aspects of management across differentcontexts.

Managerial functions approach also helps inclassification of management knowledge

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LA!!"!#

Setting O!

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O$#A!"%"!#

An "ntentional &tructure of $oles

Organi'ational &tructure

$esponsibility ( Authority forachieving objectives

)epartmentation

&pan of *ontrol Line ( &taff $elationships

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L+A)"!#

Leadership &kills

Motivation

,eam -ork *ommunication

!egotiation *onflict $esolution

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*O!,$OLL"!#

Anticipate Monitor ( $espond to changing+nvironment.

Measurement of Actual erformance *omparison against the &tandard Managerial Action to correct )eviation

,raditional Financial *ontrols are based on L"/0")",1 A*,"2",1 $OF",A3"L",1 L+2+$A#+ 3ALA!*+ &*O$+*A$)

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Managerial $oles

"!,+$+$&O!AL Figurehead Leader Liaison

"!FO$MA,"O!AL Monitor )isseminator &pokesperson

)+*"&"O!

+ntrepreneur )isturbance 4andler $esource Allocator !egotiator

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Management &kills

,+*4!"*AL &5"LL&

*O!*+,0AL &5"LL&

40MA! &5"LL& Managers at ,op Level need

*onceptual &kills the most and First6

Line Managers ,echnical &kills themost