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    Principles of management book @ bec doms bagalkot mba Principles of management book @ bec doms bagalkot mba Document Transcript

    • PRINCIPLESOFMANAGEMENT BSPATIL 1
    • OBJECTIVE: This material attempts to give you an understanding of the concept Managementapproaches.Planning : Planning – Nature and importance – forms – strategic and Tactical – Type of plans –Steps I Planning, Decision – Making – Type of Decision – Decision Making process – Rationality indecision – making.Organization: Organization – Procts of organizing – Organization structure departmentalization –Span of Management – Delegation – Authority, Responsibility, Accountability – Decentralization.Direction : Direction – Principles – elements – Motivation – Maslow, Hexrzberg, Varoom models –Communication : Process – Forms – Network – Barriers – Measuring effectiveness – Co-ordination.Leadership : Leadership theories – Style – Managerial Grid – Control – Controlling and Planning –Types of control – Concurrent and forward control – Principles of control – Areas of control – Controltechniques. BSPATIL 2
    • CONTENTSSl. No. Lessons Pg.No. 1. Introduction to Management 4 2. Planning 14 3. Organisation 21 4. Direction 33 5. Motivation 35 6. Communication 41 7. Leadership 52 8. Co-ordination 57 9. Control System and Process. 59 BSPATIL 3
    • LESSON – 1 INTRODUCTION TO MANAGEMENTMANAGEMENTManagement is the process of designing and maintaining an environment in which individuals workingtogether in groups to accomplish selected aims efficiently. It connotes different meaning indifferent contexts. The concept management may be used asCollective noun - Board of directors or Executive CommitteeField of study - A branch of knowledge including the principles, techniques, functions and problem management.Function - Functions to be performed to attain the organizational objectives-planning, organizing direction, co-ordination and controlIn a more important sense, management is a vital function concerned wth all aspects of the working ofan enterprise. Here the management is considered as a body of knowledge consisting of severalconcepts, principles, techniques and theories which can be adopted in any group Endeavour.DEFINITIONS“Management is an art of knowing what do you want to do and then seeing that is is done in the bestand cheapest way.” -F. W. TAYLOR“To manage is to forecast, to plan, to organize, to command to co-ordinate and control. - HENRY FAYOL“Management is a distinct process consisting of planning, organizing, actuating and controllingperformance t determine and accomplish the objectives by the use of people and resources,” - GEORGE R. TERRY“Management is the creation and maintenance of internal environment is an enterprise whereindividuals working in groups can perform efficiently and effectively toward the attainment of groupgoals. It is an art of getting the work done through and with people in formally organized groups.” - KOONTZ ANDO’DONNELFEATURES OF MANAGEMENTThe important characteristics of management as a business function are: 1. It is an art of getting things done through and with people. 2. Art and science of decision making and leadership. 3. It is a universal process for achieving results. 4. It is an profession which involves specialized training and is governed by an ethical code. 5. It coordinates human factor and physical resources for the accomplishment of group objectives. - by balancing and integration (or) - by innovation and adaptation BSPATIL 4
    • IMPORTANCE OF MANAGEMENT STUDYThe need and significance of management functions in the modern organizations are given below. 1. To increase the efficiency 2. to give a definite shape to management function. 3. to improve research in management. 4. to attain social goals by effective utilization of resources.NATURE OF MANAGEMENT FUNCTIONS1. Universality : It has universal application in all kinds/nature and size of business activities. 2. Dynamism : This body of knowledge is going on changing continuously with respect changes that are taking place in the organizational environment. 3. Relativity : It embraces all business functions at different levels. 4. Regularity of human nature : It helps to shape the human behaviour in the work environment.APPROACHES TO THE STUDY OF MANAGEMENTA brief discussion about different approaches of management is given below.EMPIRICAL APPROACHThe empirical school of management bases its methods on a close study of past managerial experiencesand management cases. As such, it is also known as case approach or management experienceapproach. According to this approach, management is considered a study of manager in practice. Theintention of studying experience is to draw generalizations and to develop means to teachingexperiences to other practitioners and students. Attempts are made to duplicate successful experienceswhile avoiding unsuccessful ones. This approach offers the most conventional way of acquiring skills in management, that is,learning through the experience of others. This approach also helps in classroom, situations fordeveloping diagnostic and analytical skills in management students. Following limitations of thisapproach are quite obvious. - This empirical approach, basing its generalizations on cases and past experiences has notcontributed anything fundamental to the development of management as discipline because of obviouscontradictions in various management experiences.HUMAN BEHAVIOR APPROACHThe human behavior approach is the outcome of the thoughts developed by behavioral scientists wholook at the organization as collectivity of people. Since management involves getting things done withand through people, the study on management must revolve round human behavior. This approach canbe divided into groups interpersonal behavior approach and group behavior approach. This approachsuggestion how the knowledge of human behavior can be used in making people more effective in theorganization.However, this approach is not free from limitations. It is true that manage can be better placed by BSPATIL 5
    • understanding human behavior but equating management with human behavior is untenable. There issomething more than mere human relations management. Human behavior approach provides only thediagnosis for human problems but problems have to be solved by taking many more factors which arenot explained by this approach.SOCIAL SYSTEM APPROACHClosely resembling the human behavior approach and often confused intermixed with it is the socialsystem approach. The real pioneer of social system approach is Vilfred Pareto, a sociologist. His ideaswere later developed by Chest Bernard who has really developed the concept of social systemsapproach management. According to this approach, the organization is essentially a culture systemcomposed of people who work in cooperation. As such, for achieves organization goals, a co-operativesystem of management can be developed only understanding the behavior of people in groups. The social system approach has real significance to the practicing managers in the sense thatall managers operate n a social system and the organization is likely to succeed if the demands of thesociety in which it operates as fully recognized. The approach, however, spreads the boundary andapplication of management beyond the true concept of organizations.SOCIAL TECHNICAL SYSTEMS APPROACHThis approach believes that to solve organizational problems, it is not enough to look at the cooperativesocial systems alone but technical systems (methods and machines) and how it affects and is affectedby social systems and a technical system. The real pattern of behavior in the organization is determinedby the interaction of the two. The major contribution of this approach is that while analyzing management problem ofgetting things done by people, adequate consideration should be given to technology as well asinformal interactions of people. Thus any change in technology must be viewed in subsequent changein social interactions at the workplace. However, this approach is more suitable for managing theproblems at the shop floor leave rather thandandling the total management problems.DECISION THEORY APPROACHThe major emphasis of this approach is that decision making is the job of every manager. The manageris a decision maker and organization is a decision-making unit. Therefore, the basic problem inmanaging is to make rational decision. The approach contributes to the sharpening of managerial tools specially for making suitabledecisions in the organization. The approach demonstrates how managers can discharge their functionseffectively. Decision-making is vital in every school of management. The vital aspect cannot be deniedbut management is more than mere decision making.MANAGEMENT SCIENCE APPROACH Management science approach also known as mathematical or quantitative measurementapproach, visualizes management as a logical entity, the action of which can be expressed in terms ofmathematical symbol relationships and measurement data. Management science approach is a fast developing one in analyzing and understandingmanagement. This has contributed significantly in developing orderly thinking in management whichhas provided exactness in management discipline. Various mathematical tools like sampling, linearprogramming, games theory, time series analysis, emulation, waiting line theory etc, have providedmore exactness in solving managerial problems. However, it is very difficult to call it a separate schoolof management because it does not provide the answer for the total managerial problems, Moreover,many managerial activities are not really capable of being quantified because of involvement of human BSPATIL 6
    • being who are governed by many irrational factors also.SYSTEMS APPROACH This approach is of comparatively recent origin, starting late 1950, it ha assumedconsiderable importance in analyzing the phenomena of management. It is an integrating approachwhich considers management in its totality based on empirical data. The basic idea of systems approachis that any object must rely on a method of analysis involving simultaneous variations of mutuallydependent variables. The implication of systems approach are given below. System approach of management provides and integrated approach of managing. Thisconsiders management in its totality. System approach of management provides an integrated approach of managing. Thisconsiders management in its totality. System approach possesses the conceptual level of managerial analysis much higher thanany other approach. It provides a framework through which organization – environment interaction canbe analyzed and facilitates decision-making, since the system within which managers make decisionscan be provided as a more explicit framework decision-making is easier to handle. It is often suggested that system approach is too abstract to be of much use to practicingmanagers. It merely indicate that various parts of the organization are interrelated. System approach of management lacks universality and its precepts cannot be applied to allorganizations.CONTINGENCY OR SITUATIONAL APPROACH The basic idea of contingency approach is that there cannot be a particular managementaction which will be suitable for all situations. Rather, and appropriate action is one which is designedon the basis of external environment and internal states and needs. Contingency approach tries to fillthis gap by suggesting what should be done in response to an event in the environment. Contingency approach, on the other hand suggests an active interrelationship between thevariables in a situation and the managerial actions devised. The implications of the contingencyapproach are given below. It is the sophisticated approach to understand the increasing complexity of organizations.It emphasizes the multivariate nature of organizations and attempts tounderstand how organizationsoperate under varying conditions. The approach is directed towards suggesting organizational designsand managerial actins most appropriate to specific situations. Inspite of the various contributions, contingency approach has not been acknowledged asa unified theory of management because it suffers from some limitations. 1. Inadequate Literature Contingency approach suffers from inadequacy of literature. 2. Complex : Determination of situation in which managerial action is to be taken involves analysis of alarge number of variables with multifarious dimensions. 3. Reactive not Proactive: Contingency approach is basically reactive in nature. It merely suggests what managers can do in given situation. BSPATIL 7
    • OPERATIONAL APPROACH This approach attempts to draw together the pertinent knowledge of management by relatingit to the functions of managers, commonly known as management process. As such this approach isalso known as management process approach. This approach views the management as a social processcomprising a series of actions leading to the accomplishment of certain objectives. The significance ofoperations approach is given below. 1. Operational approach offers a broad, easy to understand conceptual framework of management. The approach includes the entire scope of management and recognizes it as a separate discipline. 2. This approach suggests that management is a universal phenomenon irrespective of the type of organizations or levels of an organization. 3. Operational approach provides useful concepts for practicing managers. It helps the managers to put their knowledge to use. It offers practical suggestions by providing classification of managerial functions at first level into planning, organizing, staffing, directing and controlling. However the operational approach has been criticized on the following grounds. 1. The basic tenets of operational management that is , various management functions, are not universally accepted. 2. Another criticism against operational approach is that various terms used in this approach are not commonly shared. 3. The analysis of various approaches suggests that no approach is fully free from shortcomings. However, a positive sign is emerging in the form of convergence of various approaches. The convergence is provided by operational approach as compared to any other approach.FUNCTIONS OF MANAGEMENT The basic aim of managing is to achieve certain objectives or goals. The manager must be sure of theobjectives he desires to attain or of the end result to be ensured. The precise and the complete statementin this regard would make the objectives clear and understood by all concerned who have ot divert theiractivities towards its attainment. The desired result, objective or goal is attained by performing certainfundamental management functions which can be grouped under basic heads, namely 1. Planning 2. Organizing 3. Staffing 4. Motivating 5. Directing 6. Coordinating 7. ControllingPLANNING It means “Preparing a sketch or an outline of any proposed plan of actions”. It impliesconsidering and arranging in advance a projected course of action. It can also be definedas determiningwhat is to be done, making the decisions to do it, and devising a procedure, method and time table to doit. Planning is a general activity. It is a necessary part of all operations of an enterprise, and for theoperations of each of the departments and sections. It stimulates people to action and also determinestheir mode of action. BSPATIL 8
    • For eg. Sales manager plans his sales campaignThe purchasing Manager plans his purchasing and transporting operationsThe production Manager plans his production programs.Planning is an exercise in forecasting and decision making. It involves forecast of future conditions andan estimate of how the proposed plans would be affected by them.Thus planning involves two aspects. First it involves mental formulations of an idea of what is desiredto be achieved. Upto this, it remains at the thinking level and is based on forecasts and estimates.Secondly it determines the mode of action to be pursued to achieve what has been thought up. At thisstage, the idea takes a definite shape with a due regard to the ordinary and immediate circumstancesfacing the enterprise.ORGANISATION To organize means to put into working order and arrange in a system. In this sense, anorganization is an organized body or persons. Organising may be defined as arranging a number ofcomplex tasks into manageable units and defining the formal relationship among the people who areassigned the various units of tasks. This definition is in the context of attainment of the goals andobjectives of an undertaking. Generally, identifiable units of tasks are put under the charge of a department, section ordivision. The head of that department, section or unit being given with the authority to perform thosetasks. For eg. Business activities in an industrial concern may be grouped under : 1. Production 2. Sales 3. Finance and 4. PersonnelAfter classification and analysis of functions to be performed by each department, persons possessingrequisite qualifications and experience may be appointed as head of each of these departments. Suchpersons should also be given proper authority to discharge their functions efficiently.. Thus basically organization is concerned with grouping the activities required to attain theplanned objectives, defining responsibilities of the people in the organization, delegating theappropriate authority to them to discharge the respective responsibilities and establishing structuralrelationships to enable Co-ordination of the individual efforts towards accomplishment of the enterpriseobjectives. The main objective of organization is to establish well defined relationships as betweenindividuals and groups of individuals and between the activities performed by them.STAFFINGIt has been defined as manning and keeping manned the positions provided by the organizationstructure. Thus staffing involves four things:Assessment of personnel needs of the enterprise and selection and training of employees.Determination of employees remuneration.Evaluation of employees performance.Establishment of effective communication skills.Staffing is a difficult managerial function, because it is concerned with selection of properly qualified BSPATIL 9
    • and mentally well-adjusted persons and their retention in the enterprise as a contented and motivatedwork force.DIRECTINGTo direct means to guide and supervise any action or conduct. It implies guidance or instructions aboutwhat to do and how to do it. We have seen that in organisatin executives assign responsibilities andduties to their subordinates and delegate to them with requisite authority to perform the assignedresponsibilities of duties. This in fact is of very essence of management the art and process of gettingthings done by others. No doubt, executives have the authority to force their subordinates to complywith their directives. In case any subordinates faisl or refuses to comply, be may be thrown out orpunished in some other manner. But this a wrong view of the enterprise entire process of management.On any case, with strong trade unions and a number of labour laws to protect the worker, it would notbe wise to demand compliance from one’s subordinated. For securing whole-hearted compliance fromsubordinated, the function of direction assumes considerable significance.Direction function involves 1. Issuing orders and instructions to subordinated. 2. Guiding, training, energizing and leading the subordinates to perform the work methodically. 3. Exercising supervision over the work done by subordinates to ensure tat it is n conformity with aims and objectives of the enterprise.From all accounts, the function of directions is very important. Thus to make the organization click, itbecomes necessary to direct one’s subordinates in a manner that they become effective instruments inthe realization of enterprise goods. The process of direction comprises of the following elements viz. i. Leadership ii. Communication iii. Motivation and iv. SupervisionA detailed discussion about these aspects is given in the subsequent chapters.CO-ORDINATIONSome authorities emphasis co-ordination as a separate function of Management. This approach has notbeen adopted here because it is felt that co-ordination is emphasized in each of the functions ofmanagement process. Co-ordination must be sought from the very first step, namely, planning, so thatplans of all departments are integrated into a master plan, issuing the adequate co-ordination. Similarlyorganizing of people into groups and work into activities involves adequate co-ordination. It can alsobe secured through proper motivation of the workers towards organized efforts in terms oforganizational objectives and personal objectives of the employees through an integration of suchobjectives. Finally the controlling aspect also indicates further co-ordination is required resulting inimprovements and fresh plans.CONTROL BSPATIL 10
    • Controlling can be defined as “comparing results with plans and taking corrective actin whenresults deviate from plans.” In an organizational set up, It every Manager’s responsibility to control the performance ofwork and workers places under his charge.Pre-requisites of control: 1. Control is possible only where is there is a plan according to which actual performance is intended to proceed. 2. The second requirement of control to measurement of the results of actual operations. 3. The third requirement of control is taking corrective action as soon as deviation from the plan is discovered. Fundamentally, control is any process that guides activity towards some pre-determined goal. The essence of this concept is in determining in whether the activity is achieving the desire results. This is what control is all about. For control to be effective and fruitful, it must be based on a plan. Then on the basis of information received from the operational level, there must be measurement of actual performance to ascertain deviations. Thus the above functions are said to be the important functions of Management. ADMINISTRATION AND MANAGEMENT The two terms administration and management are being used interchangeably for all practical purposes. However these two terms are different from each other. Oliver Sheldon summaries the distinction as follows. Administration is the function in the industry concerned in the determination of corporate policy, the co-ordination of finance production and distribution, the settlement of complaints of the organization and ultimate control of executive”. “Management is the function in the industry concerned in the execution of policy within the limits setup by the administration and the employment of the organization for the particular object set before it”. William sprigeal distinguishes “Administration as the determinate function and “management” as the executive function. Management is primarly concerned with carrying out of the broad policies laid down by the administration”. Thus the administration is concerned with the thinking function and management with doing function. The essence of management is highlighted by the definition given by KOONTZ and O’ DONEL and by DONALD CLAGH. The later describe management a the art and science of decision making and leadership. Art of getting things done through people and with people. Human factor in industry has endless capacity for work provided planning and resources are made available to it. The manager’s goal of attainment of enterprise objectives in the more efficient manner can be accomplished only when the people in the enterprise work to the best of their ability in the spirit of cooperation and zeal. MANAGEMENT : AN ART OR SCIENCE BSPATIL 11
    • MANAGEMENT AN ART According to G. TERRY; Art is “Bringing about a desired result through the application of will in any activity is called as an art,’ The emphasis is on applying skills with knowledge and accomplishing an end through deliberate effort. Thus the function of the art is accomplishing concrete ends efforts, results; predict situations that would not come about without the deliberate effort, to secure them. MANAGEMENT IS A SCIENCE Science has been defined as “body of systemized knowledge accumulated and accepted with respect to the under standing of general tools concerning particular phenomenon subject or object of study. It is absolutely necessary that it should have codified principles and techniques that explains certain truth with respect to basic phenomenon. In this sense management is certainly regarded as science as it has also develop in to a systemized knowledge regarding a particular phenomenon, namely, managerial function. MANAGEMENT AS PROFESSION Profession is defined as an occupation based upon the specialized intellectual study and training, the purpose of which is to supply skilled service or advice to others for the definite fee or salary. CHARACTERISTICS OF PROFESSION 1. Existence of knowledge :Profession emerges from the establishment of fact that there is a body of knowledge which cannotstarted around but has to be studied for being a successful professional. 2. Acquisition of knowledge :An individual can enter profession only after acquiring knowledge and skills through formal trainingfor example, only the law graduates can enter the profession of legal practice. 3. Professional association :An occupation which claims to be profession should have an association. However manager do nothave single unified professional group like Indian medical council for medical practitioners from thisnew management cannot be termed as trade profession. 4. Ethical code :For every profession some ethical standards are provided and every individual of the profession isexpected to maintain conformity with these standards. In management also, code of conduct has beenformulated to suggest the behavioral pattern for professional managers. 5. Service motive: BSPATIL 12
    • It is essential because the monetary value of professional service cannot be measured easily in absenceof market mechanism except the competition among the professionals themselves. The success of anyprofession is measured not in terms of money. It earns but by the amount of social service it provides.Similarly contributions of management cannot be measured in terms of money alone because withoutintegrating effort of management, resources worth millions of rupees may be useless.Once organization grows beyond certain size, changes in the nature of management process demandsthat ownership and management should be divorced. So management positions should be held bypersons who have professional skill and adequate training. BSPATIL 13
    • LESSON – 2 PLANNINGMEANINGIt means determining what is to be done, how, when and by whom it is to be done. It lays down andobject to pursuit and chalks out a specific course of action to achieve it. It is the first step in themanagement process concerned with establishment of objectives and goals to be attained in the futurein the light of an analysis of present limitations for attaining such goals with a views to their removal orreduction, anticipation and designing the course of action and programmes for attaining such pre-determined goals.DEFINITION“Planning is the selecting and relating of facts and the making and using of assumptions regarding thefuture in the visualization to achieve desire results.” GEORGE TERRY“Planning is deciding advance what to do, how to do it, when to do it, who is to do it. It bridges the gapform where we are, to where we want to go. It makes it possible for things to occur which would nototherwise happen.” - KOONTZ & O’DONNEL“Planning is the thinking process, the organized, foresight, the vision based on facts and experience thatis required for intelligent action.” - ALFORD & BEATTYFEATURESAs a process, planning has certain features as given below.- It s the thinking process.- “Choosing” is at the root of planning.- It is pervasive – prevailing in all activities- Accomplishment of enterprise objectives.- Primacy of planning – Prime- It is all embracing.- It leads to increase in efficiency.- It is an integrated process consisting of objectives, policies, proceduresIMPORTANCE OF PLANNINGThe significance of planning function could be indentified from the follows- To tackle increasing complexity in modern business.- To face increasing competition.- To provide for complex technological changes.- To insure against business failure.- To meet the changing economic and political situations.- To exercise effective control.- To bring greater economy. BSPATIL 14
    • Merits of planningPlanning process facilities the managerial function on the following ways:-Selection of best objectives can be made with the help of planning Profits, prestige, Favourableconsumer reaction, High morale of workers, Man-power development.- Unity of action could be ensured.- Aid to co-ordination and control- Aid to growth and Expansion.- Aid to employee co-operation.- Aid to economy.- Aid to foreseeing the future.- Increases the effectiveness of manager.Limitations of planningThe effectiveness of planning process may be affected on the following reasos1. Uncertainty Planning is based on forecasted results which will not Hold good in uncertain situations.2. Rigidity Prior determination of policy, programme, etc. Makes it regid.3. Unsuitability Business is a dynamic activity and hence plan May not be suitable in all situations.4. Costly Planning is time consuming and costly affairKINDS OF PLANNINGOn the basis of the time factor, planning may be Long Ranging planning - 5 – 10 years Short Range planning - Not more than one yearOn the basis of business function for when planning is to be drawn Product planning, project andactivity planning.DECISION MAKING“It is ht process selection an alternative from two or more alternatives to determine an opinion or acourse of action.” - GEORGE TERRYFactors involved in decision making : Tangible factors: Profits, Quality of output and all other quantitative factors Such as Man-hours, Machine hours. BSPATIL 15
    • Intangible factors: a.) Employee morale. b.) The prestige of business concern. c.) Consumer behaviour. d.) Such other abstract factors.Need : Weighing the consequences of each alternative course of action.Steps in Decision-making process: Defining and analyzing the problem, Finding relevant facts. Developing alternative solutions. Selecting the best solution. Converting the decision into effective action.Decision-making Process Formulation Selection Deliberation Investigation Conception PtionCRITERIASome of the rationales to be adopted indecision-making process are:Reduction of cost, Maximization of profit, saving of time, development of managerial skill, increasingproductivity etc.TYPES OF PLANS 1. Standing or repeated use plans 1. Objectives 2. Policies 3. Procedures. 4. Rules 5. Strategies. 2. Single use of plans: 1. Programmes. 2. Budgets BSPATIL 16
    • A brief description about these sub-types of plans are given below: a.) ObjectivesIt may be defined as the specific goals or targets to be accomplished viz., profit making, cost reduction,increase in productivity goodwill, personnel development. Healthy employee relations, socialresponsibility.Fixing of objectives in an organizational planning function ensures the following advantages.It is vital to planning function.It helps to Integrate planning.It ensure performance control.Limitations :However, fixation of objectives is subject to certain limitations viz.,Difficult to define the objectives.Difficult to devise suitable means.Difficult to avoid conflict.Remedies: 1. Objectives should be specific, 2. Objective should be realistic, 3. Objective should be backed by suitable sub-goals. 4. Objectives should be flexible. b. PoliciesIt may be defined as a guide to thinking and action of those who have to make decisions in the courseof accomplishment of the enterprise objectives. They are formulated in broad forms and provide acompressive and flexible course of action to be pursued to attain the given objectivesFEATURESIt is a broad outlines about the things to be done and the way in which they an to e done.It is Consistent with that of the organizational plan.It is to be adequate in number to achieve organisationals goals.It should be a sound one.It must ensure flexibility.KINDS OF POLICIES 1. Internal or originated polices. 2. External or imposed policies. 3. Addealed policies. 4. State or explicit policies. 5. Unstated or implied policies. BSPATIL 17
    • Factors to be considered while formulation policies are : 1. Values, Beliefs, Ambitions, and Foresight of the owners and members of the top management. 2. Prevalent Technology. 3. Finance availability. 4. Employee reaction. 5. Accomplishment and activities of competitors, 6. Governmental regulation and control. 7. General business environment. 8. Price levels. 9. Public attitudes and behaviour.Merits : 1. Guide to think and act. 2. Ensures Consistency in all actions. 3. Broader applicability. 4. Confidence booster.Demerits : 1. It won’t help to solve all problems. 2. Instant solutions to problems may not be available. 3. It cannot substitute human judgment. 4. It may nor encourage initiative.c. Procedures“The process of establishing time sequences for work to be done.”They may be described as plans prescribing the exact chronological sequence of specific tasks requiredto perform designated work.To determine the specific tasks to be performed.The time when those tasks will be performed.The person who will perform them.Merits : 1. Basis of control 2. Standardisation of activities can be done. 3. Ensure consistency in all operations. 4. Aid to communication and co-ordination.Limitations : 1. Redundacy may takes place in course of time. 2. Updating becomes must. BSPATIL 18
    • d. Rule :It is decision made by the management regarding what is to be done and what is not to be done in agiven situation. It applies to specific situations. Rules do not leave any scope for decision making nordo they permit any deviation.e. Strategies :It is derived form the greek word strategies, meaning general,It means the art of projecting and planning the choice of means by which the enterprises forces ay beemployed most effectively in order to accomplish it’s intended goal. It is said to be formulated only tomeet the challenge posed by competitions policies and activity. The following factors may beconsidered for formulating strategies.- Correct assessment of reaction of the parties concerned.- What human and physical resources are available to draw up a strategy.- Temperamental make-up of the persons to check-mate whom the strategy is being would up.TYPES OF STRATEGIES- Strike while the iron is hot-act prompt a while the action is likely to get results.- Camel’s head in the tent – creation of confidence regarding plan to some- Unity is strength- Time is greater heater.- Offence if the best form of a defence.- Divide and rule.Successful implementation of strategies : 1. Communicating strategies to all key decision-making managers. 2. Developing and communicating planning premises. 3. Ensuring that action plans contribute to and reflect major objectives and strategies. 4. Reviewing strategies regularly. 5. Developing contingency strategies and program. 6. Making the organization structure fit planning needs. 7. Continuing to emphasis planning implementing strategy. 8. Creating a company climate that forces planning. f. ProgrammeIt lays down the operation to be carried out to accomplish a given work. It prescribes how enterpriseresources should be used.Merits 1. Action based – practical guide to managerial action. 2. Greater motivation.Demerits 1. Greater risk of failure 2. Inadequate motivation. BSPATIL 19
    • g. BudgetIt is a plan relating to a period of time expressed in numerical terms. “as a pre-determined statement ofmanagement policy, during a given period, which provide a standard for comparison with the resultsactual achieved.Objectives of Budgeting : 1. To ensure effective planning. 2. to facilitate Co-ordination function. 3. To exercise Controlling effective and achieving desire goals. 4. To motivate the workforce for achieving desired results.Merits :Instrument of management policy 1. Time bound 2. Specific targets. 3. Synthesis of past, present and future. 4. Right motivation. 5. Basis of control.Limitations 1. Cabined and confined. 2. Excessive reliance on past experience. 3. Danger of inaccuracy in estimates. 4. Hampers initiative – rational and pragmatic initiative is stiffed.PLANNING PREMISESManagerial plans are based on certain assumptions which are called planning premises. They constitutethe ground on which plans will stand. Meaningful premises facilitate consistency and coordination ofplans. The premises may be ofNon-controllable premises such as economic conditions, political situations, tastes, preferences ofpeople etc.Semi-controllable premises such as firms market shares, union management relations etc.Controllable premises such as policies of the organization, procedures, rules etc.Effective Premising :To effectuate the planning premises following guidelines may be adopted.Selection of the premises that bear materially on program.Development of alternative premises for contingency planning.Verification of the consistency of premisesCommunication of the premises. BSPATIL 20
    • LESSON – 3 ORGANISATIONThe term organization is derived form the word “organism” which means structure with parts sointegrated that their relation to each other is governed by their relation to whole.The term organization is used both structural and functional sense. As a structure it means a developedenterprise being operated t achieve the given goals. As a function it refers to establishing relationshipbetween activities and authority pertaining to an enterprise.Organization is nothing but a process of integrating and co-ordinating the efforts of men and materialsfor the accomplishment of a set objective.DEFINITION“Orgnisation is the process of identifying and grouping work to be performed defining and delegatingresponsibility and authority and establishing relationship for the purpose of enabling people to workmost effectively together in accomplishing objectives. -ALLENOrganisation thus is an arrangement for internal administration of the enterprise. It describes the partwhich each employee is intended to play in the operation of an enterprise and ensures that concernedendeavour of all of them will be conductive to the full implementation of the plans of the enterprise.FACTORS INCLUDED IN THE CONCEPT OF ORGANIZATION a) Assembly of business elements such as men, money and materials. b) Creation of formal relationships between men employed at different levels through a hierarchy of authority. c) Defining the functional role of the personnel and laying down the range of their responsibility for business performance. d) Operating the organizational activities in conformity with the establishment objectives of the enterprise.PRINCIPLES OF ORGANIZATION 1. Principles of objectives. 2. Principles of authority. 3. Principles of ultimate authority. 4. Principles of formal authority 5. Principles of the span of control 6. Principles of decision 7. Principles of Exception 8. Principles of Definition 9. Principles of Balance 10. Principles of Continuity 11. Principles of Organisation cost 12. Principles of Effective communication. BSPATIL 21
    • ELEMENTS OF ORGANIZATION 1. Division of work 2. Grouping of activities. 3. Assignment of Duties. 4. Delegation of Authority 5. Establishment of relationship.Hence internal organization, implies designing an administrative set-up consisting of individuals withdefined task and responsibility to be performed according to an orderly sequence procedures forattaining the result.ORGANISATIONAL CHARTIt is important tool for portraying net work of an organization structure. It shows 1. The main portion, nature of relationship between 2. Levels of management.“It is diagrammatic form which shows important aspects of an organization, including the majorfunction and their respective relationship, the channels of supervision and the relative authority of eachemployees who is incharge of each respective functions.” -FEORGE TERRYTYPES OF CHARTS 1. Vertical chart 2. Horizontal chart 3. Circular chart 4. Tree chartMerits of Organisational Chart : 1. Clarity in relationship 2. Easy to understand at a glance 3. Familiarizing new employees 4. Helps in formulating training programme 5. Helps to organizational change 6. It serves as a better method of visualizing the tone and character of an organisation.Limitations 1. Likely to be outdated 2. Rigidity 3. It shows only relationships 4. Shifting of responsibility to somebody else 5. Does not show extents of authority or responsibility. 6. It may go against teamsprit 7. It ignores the informal aspects of orgnisation. BSPATIL 22
    • TYPES OF ORGANIZATIONThe problem of organization is to select and combine the efforts of men of proper characteristics so asto produce the desired result. Although character and type of organization would depend largely on thesize and nature of enterprise, the following broad patterns of organizing the personnel have beenevolved.Line organization Staff OrganisationFunctional Organisation Line and Staff OrganisationMatrix Organisation Projectised OrganisationA brief outline about the three basic organization structures are given belowLINE ORGANISATIONIt is the oldest type of organisation in use in which authority flows from the men at the top to the lowestman vertically. i.e., the directionsare issued by the person incharge of the whole organization and aredirectly conveyed to the persons responsible forhte execution of the work. The advantages of thisstructure are: Simple to understand and develop. Clear-cut division of authority and responsibility is possible Discipline can be easily maintained. It makes for quick actionHowever, this structure has following shortcomings: Makes the organization more regid and inflexible Lack of expert advice may be there. Key man are loaded heavily. Loss of one or two capable men may mar the organisatioin. Line Organisation Chart General Manager Manager Manager Eastern Region Western RegionManager 1 Manager 2 Manager 3 Manager 4 Manager 5 Manager 6LINE AND STAFF ORGNISATIONA manager today cannot hope to think of all possible factors in a given situation. Therefore, he hs a set BSPATIL 23
    • of expert advisers. Those functions which have direct responsibility for accomplishing the majorobjectives of the firm are called line functions. The staff functions are supposed to help and assist theline in discharging their responsibility. The staff position established as a measure of support for theline organization may be of personal staff, specialished staff and general staff. This form has certainadvantages and limitations. They are It is based planned specialization It brings expert knowledge to bear upon management It provides more opportunity for advancement for able workers.Limitations:Relationship between line and staff member may creates confusion.Lack of authority may affect the interest of the staff member.Prestige and influence of line member ay suffer in front of specialist.FUNCTIONAL ORGANISATIONHere the whole task of management and direction of subordinates should be divided according tothe type of the work involved. The functional management carries this idea to its logical limit anddivides up management into a number of functions such as production, sales, finance and personae, andresearch and development etc. Each of these departments would serve its best for the organization. Itsadvantages are;It ensures a greater division of labourIt Improves the efficiency of the organization.It brings specialization and innovations.It facilitates mass productin. However, it has certain limitations as given below;Strict enforcement of discipline is questionable.Creates complexity in structuring activities.Responsibility cannot be fixed effectively.A model of line staff and functional organization structure is given below.Chairman PA to ChairmanDirector Personal Director Production Director Purchasing Director FinanceGM 1 GM 2 Manager Manager Manager Manager Manager Manager Personal Production Finance Personal Production Finance BSPATIL 24
    • FORMAL ORGANISATION“A Network of personal and social relation not established or required by the formal organization butarising spontaneously as people associate with one another.”Types of informal groups 1. Social overlays 2. Functional overlays 3. Decision overlays 4. Power overlays 5. Communication overlaysBenefits 1. Sense of belonging 2. Safety value for emotional problem 3. Aid to the job 4. Breeding ground for innovation and originality 5. Important channel of communication 6. Social control 7. Check of authority 8. Self – policing 9. Fills gaps in a managers abilities 10. Gives the managers feedback about employees and their work experienceLimitations 1. Resistance to change 2. Suboptimization 3. Rumor 4. Group think philosophyAUTHORITY AND RESPONSIBILITY Authority is the basis of organization in as much as organization is described as a system ofauthority relationships. Authority is the power to command others to act in a manner deemed by thepossessor of the authority to further enterprise or departmental purpose. It is the power to makedecisions which guide the actions of others. The person who makes the decisions is the superior and theperson who accepts them and is guided by them is called one subordinate.Authority is the right to give orders and the power to exact obedience. - HENRI FAYOLAuthority may be of formal authority, acceptance authority, authority of situation, position authority,and technical authority. Authority Power1 It is the institutionalized right of a It is the ability of a person to influence superior to command and compel his another person to perform an act. subordinates to perform a certain act. BSPATIL 25
    • 2 It rests in the chair It rests in the person3 It is delegated It is earned by own efforts4 It is well defined It is undefined5 It is what exists in the eye It exists in fact. It is a dejure concept It is defacto concept6 Basis for formal organization Basis for informal organResponsibility is an obligation of the individual to perform assigned duties to the best of his abilityunder the direction of his executive leader. - KEITH DAVISResponsibility refers to duty, activity or sometimes even authority. It really means that the obligation ofa subordinate to perform the duty assigned to him. The essence of responsibility is, then obligation. Inthe normal functioning of an enterprise much of the responsibility in the nature of continuing obligationwhich means that the subordinate has an obligation to discharge his functions as required by thesuperior continually. Responsibility involves Compliance, obedience and Dependability. A failure toobserve these elements may call forth a penalty, punishment or disciplinary action against the erringsubordinate. The term accountability can also be used as a substitute for responsibility. Accountabilityrefers to the liability of a subordinate for a proper discharge of his functions. It includes responsibilityand arises from it. But accountability cannot be delegated. Thus to be accountable is to be answerablefor the fulfillment or non-fulfillment of the authority or responsibility assigned.DELEGATION To delegate means to grant or confer. Delegation means conferring authority from one managerto organizational unit to another in order to accomplish particular assignments. Delegation determinesthe effectiveness of the manager in his work. The way in which delegation will influence therelationship between the subordinate and his superior and through it the performance of thesubordinate. In the absence of delegation, he may receive orders from many people and may, therefore,be unsure of his job.ELEMENTS OF DELEGATIONThe process of delegation involves three basic actions whether expressed or implied. They areThe delegator should assign duties to subordinates.He has to grant authority to subordinates to the delegated part of his work.Delegation should create obligation on the part of subordinate to complete the job.Merits 1. Relieves manager’s workload. 2. Leads to better decisions. 3. Speed up decision – builds up morale. 4. Train subordinates and 5. Helps to create formal organization structure. BSPATIL 26
    • BARRIERS TO DELEGATION.On the manager’s side: 1. Fear of loss of power 2. Lack of confidence in subordinates. 3. Fear of being exposed. 4. Difficulty in briefing.On the subordinates side: 1. Fear of criticism 2. Lack of adequate information 3. Lack of self confidence and initiative and resources. 4. No positive personal gain.GUIDELINES FOR EFFECTIVE DELEGATION 1. Clarity in assigning the task 2. Proportionate authority. 3. Limits of subordinates authority. 4. Positive incentive for accepting responsibility. 5. Proper training of subordinates. 6. Create climate for mutual trust and goodwill 7. No over laps or slips in delegation.STEPS IN DELEGATIONThe entire process of delegation of authority can be completed through the following steps.Determination of results protected.Assignment of duties.Authorization for action.Creation of obligation.SPAN OF MANAGEMENTIt is one of the organization principle. It refers to the number of subordinates for whose activities anexecutive should be held responsible. The limit to the number of subordinates who can be effectivelymanaged by a manager.The factors determining span of control of a superior are: 1. Nature of activities involved. 2. Ability of the superior (knowledge) 3. Nature and ability of subordinates. 4. Time available. 5. Place available etc.GRAICUNA’S FORMULAFrench management consultant V. A. Graicuna offer analyzing subordinate and superior relationshipdeveloped a mathematical formula. His theory identifies three types of the subordinates & superiorrelationships namely. BSPATIL 27
    • 1. Direct single relationships. 2. Direct group relationships. 3. Cross relationship between subordinates.These relationships vary (considenancy) with the size of the subordinates group while the supervisionsown direct relationship with individuals increase n (proption) to the addition to subordinates the groupsand cross relationships increase much more than proportionately.He said the total number of relationships grows in geometrical ratio, every time a new subordinates isadded.FORMULA R= Nx [2n-1+(n-1) Where N = Number of subordinates R= Total relations. 1. When two subordinates R=6 2. 4 Subordinates R = 44 = 4 x ( 24-1+(4-1)) = 4 x [23+(3)} = 4 x{8+3} = 44 Span of supervision require following skills : Supervision requires attention. Supervision requires Emotional stability. Supervision requires time. Supervision requires ability of subordinates. Supervision requires nature of work.USE OF GRAICUNAS FORMULA It clearly shows complexity and difficulty of wider spans. 1. It reminds manager of wisdom of striking to narrower spans.Limitation 1. Mathematical precision is debatable 2. Direct group relation may be far – fetched. 3. The main problem is not number of RL but their frequency and the volume of stress and strain they generate. BSPATIL 28
    • 4. It does apply in cases of cross relations of a big enterprise.Limited span of control ensures the following 1. Tighter control and closer supervision 2. Ease of managing fewer. 3. Availability of time to think and planOn the other hand limited span of control has some shortcomings also as given below 1. Additional costs having more manager 2. Complexities in communication will arise 3. Prevention of democratic participationDECENTRALIZATIONIt is the situation which exists as a result of systematic delegation of authority through out theorganization.The term decentralization carries different meanings to different people.Decentralization is an extension of delegation.Decentralization implies a systematic delegation of authority through out the whole organization.WHY DECENTRALIZATION ?Large companies having independent product or service lines may adopt a form of decentralization.Under decentralization the whole organization is divided in to self-sufficient divisions.Having experienced many difficulties in the smooth running of such centralizes organizations,decentralizations of authority has been suggested and largely resorted to particularly to achieve thefollowing purposes. - Easing burden of chief executive. - Facilitating diversification, - Providing product of market emphasis. - Developing managers and - Improving motivation.ADVANTAGES OF DECENTRALIZATION- Decentralization leads to specialization.- Encourages decision making and assumption of authority and responsibility.- Decentralization makes the sub – ordinates to work with involvement- Facilitates diversification in large scale.- Promote the development of general managers.- Aids in adoption of fast changing Environment. BSPATIL 29
    • DISADVANTAGES OF DECENTRALIZATION- Makes it more difficult to have a uniform policy.- Decentralization leads to problem in co – ordination.- May be limited to External forces.- Leads to increase in cost.- May some time leads to mis-use of power in high levels.- Leads to expenses in training a manager.- May be limited by the availability of qualified managers.DELEGATION Vs DECENTRALIZATION 1. Delegation is the process while decentralization is the end result. 2. Superior is responsible for delegation where as in decentralization subordinates are responsible. 3. Delegation is vital and decentralization is optional.DEPARTMENTATIONFirst task in designing an organization structure is the identification of activities and to group themproperly. The process of grouping activities is commonly known as departmentation.NEED AND IMPORTANCE OF DEPARTMENTATINThe basic need for departmentation arises because of specialization of work and the limitation on thenumber of subordinates controlled by a superior. 1. Advantages of specialization :Thus if the managerial function is conceived as a set of activities facilitating the work of organization,these activities can be carried out more efficiently and effectively through the division of work leadingto a specialization of managerial function. 2. Fixation of responsibilityDepartmentation helps in fixing the responsibility and consequently accountability for the results. 3. Developed of managersDepartmentation helps in the development of managers. 4. Facility in AppraisalManagerial performance can be measured when the area of activities can be specified and standards inrespect of these can fixed. Depertmentation provides helps in both these areas. BSPATIL 30
    • 5. Feeling of Autonomy :Deprtmentation provides motivation by developing feeling of autonomy to the extent possible. Thereare several bases of departmentation. The more commonly used bases are function, produt, territory,process, customer, time etc. Some of these bases are internal-operation – oriented like function,process, time while others like product, territory and customer are output-oriented.FUNCTIONAL DEPARTMENTATION The grouping of common or homogeneous activities to form an organization unit is known asfunctional departmentation. Functional departmentation is the most widely used basis for organizingactivities and is present almost in every large organization at some level. Functional departmentation is most commonly used because it offers certain advantages whichinclude advantages of specialization, ensuring performance of activities necessary for the achievementof organizational objectives, elimination of un-necessary activities, easier control over functions, easierway for pinpointing training need of the managers and maintaining the relative importance of functionsin the organization.PRODUCT WISE DEPARTMENTATION Product departmentation involves the grouping together of all actibities necessary tomanufacture a product or product line. Product departmentation is preferred for product expansion anddiversification when manufacturing and marketing characteristics of each product are of primaryconcern. Product departmentation offers several advantages places attention to product lines, reducesproblems of coordination for different products, provides opportunities for further diversification andexpansion of organization and provides product specialization necessary for managers specially wheneach product is different from other.TERRITORY – WISE DEPARTMENTATION Territorial or geographical departmentation is specially useful to large-sized organizationshaving activities which are physically or geographically spread such as banking, insurance,transportation etc., Territorial departmentatin provides certain efficiency in operation. Local factorssuch as customers, culture, styles, preferences etc., always affect organizational functioning.PRODUCTION PROCESSES – WISE DEPARTMENTATION In process departmentation, processes involved in production or various types of equipmentsused are taken as basis for departmentation. When the production activities involve the use of severaldistinctive processes, these can be used as the base for grouping of activities. Such activities may betextiles, oil production etc., The process are set in such a way that a series of operations is feasiblemaking operations economic. It provides advantages of specialization required at each level of totalprocesses, maintenance of plant can be done in better way, and manpower can be utilized effectively.CUSTOMER – WISE DEPARTMENTATIONCustomer based departmentation is basically market – oriented in which departments are createdaround the markets served or around marketing channels. The basic idea of this departmentation is toprovide services to clearly identified groups of customers. Each group of customers has differentpurchase behavior, payment schedule, demand pattern etc., Therefore they can be attracted to theorganization’s business by satisfying them by providing services, payment schedule demand patternetc. BSPATIL 31
    • CHOICE OF BASES FOR DEPARTMENTATIONThe selection of bases for departemntation involves a consideration of the relative advantages of eachbase for the organization. Ideally speaking, a suitable basis of departmentation is one which facilitatesthe performance of organizational functions efficiently and effectively so that its objective areachieved. 1. Specialization:The basis of departmentation should reflect the specialization in performing the work. 2. Coordination:Coordination involves that all the related activities are performed in a way that their performance issynchronized so that each activity contributes to others. 3. EconomyA balance should be maintained between the cost of creating a department and its contribution. Theexistence of a department is desirable only when it contributes more than its cost. 4. Focus on ResultThose activities which contribute to the achievement to these results should be given proper attention. 5. Local Conditions :Local requirements of the organization should also the taken into account while creating departments. 6. Human Considerations :Departments should be created on the basis of availability of personnel, their aspirations and valuesystems, informal work groups and attitudes of people towards various forms of organization structure. BSPATIL 32
    • Lesson – 4 DirectionDirection is instructing the subordinates to follow a certain process to attain a give objectives. It isgetting the work done through instructions and orders. It is the function of diversion in the managementprocess to get the work from the subordinates by means of guiding, motivation, communication,supervising, leading and if need be commanding.It is sum of total of managerial efforts that is applied for guiding and inspiring the working teams tomake better accomplishments in the organization.It is the heart and soul of management.PROCESS OF DIRECTION 1. Defining the objectives. 2. Organizing the efforts. 3. Measuring the work. 4. Developing the people.Ever manager in the organization gives direction to his subordinates as superior and receives direction ssubordinate from his superior.Direction may be defined as the function of management which is related with instructing, guiding andinspiring human factor in the organization to achieve organization objective. The direction is notmerely issuing orders and instructions by a superior to his subordinates, but is includes the process ofguiding and inspiring them. The analysis of definition reveals that direction function consist of threeelements.- Motivation- Leadership- CommunicationDirection has the following characteristics- Direction is an important managerial function. Through direction management can initiatesactions in the organization.- Direction function is performed at every level of management.- Direction is a continuous process and it continuous through out the life of the organization.- Direction initiates at the top level in the organization follows and bottom through therehierarchy. It emphasizes that a subordinates is to be directed by his own superior only.IMPORTANCE OF DIRECTIONThe importance of direction function in the organization can be presented as follows.- Direction initiates action.- Direction integrates employees efforts.- Direction attempts to get maximum out of individuals.- Direction facilitates charges in the organization.- Direction provides stability and balance in the organization. BSPATIL 33
    • PRINCIPLES OF DIRECTIONDirection is one of the most complex function of the management as it ideals with people whose natureitself is quite complex and unpredictable.1. Principles of relating to the purpose of directing a. Principles of maximum individual contribution. b. Principle of harmony of objectives. c. Principle of efficiency of direction.2. Principle relating to direction process: a. Principle of unity of command. b. Principle of appropriateness of direction technique. c. Principle of managerial communication. d. Principle of comprehension. e. Principle of use of informal organization. f. Principle of leadership. g. Principle of follow through.Thus one of the basics functions of management is direction. Direction means the use of leadership andmotivation to guide the performance of subordinates towards the achievement of the organization’sgoals. Important requirements for effective direction are : Harmony of objectives, Unity of command,direct supervision, efficient communication and follow-up. BSPATIL 34
    • LESSON – 5 MOTIVATIONMotivation is an art of stimulating someone or oneself or oneself to get designed course of action, topush the right button to get desire action. Motivation is an act of inducement.Motivation Results Satisfaction M = is a drive t satisfy a want S = is experienced when the outcome has been achieved.The basic principle of motivation is based upon the following policy i.e., carrot or stick policy.“Put a carrot in front of donkey to make it move or Jab his with a stick being.”NATURE OF MOTIVATION- It is a psychological concept- It is total not piecemeal.- Determined by human needs.- May be financial or non financial.- Constant processNEED FOR MOTIVATION* Maximum utilization of factors of production.* Reduce labour turnover.* Easy availability of right personnel.* Increased the efficiency and output.* Create sense of belonging.KINDS OF MOTIVATION 1. Positive motivation 2. Negative motivation 3. Financial motivation 4. Non-financial motivationTHEORIES OF MOTIVATIONManagement experts have formulated different theories on motivation at different dimensions. Theyare : 1. Maslow’s theory of motivation. 2. Herzberg’s theory 3. Mcgegor’s theory 4. Vrooms theory.Need hierarchy theory: Abraham Maslow’s book on motivation and personality emphasizesmultiplicity of human needs are arranged in an order. BSPATIL 35
    • * Physiological needs* Safety needs* Social needs* Esteem needs* Self actualization.The first two sets of needs are called Lower order needs (1,2)The other sets of needs are called Higher order needs (3,4)According to him when one needs fulfils another need will emerge automatically. While going forachieving the particular need, people like to give priority to the pressing needs first and the rest in next.Short – coming of Maslow’s theory are:- Order cannot be regarded as rigid.- No indication regarding satisfaction of needs.- It may not have universal applicatibility.- Motivation is piecemeal exercise by means of splitting of human needs.HERZBERGS’ THEORYAccording to Herzberg, factors that give real satisfaction to an individual are motiators. He classifiedthe factors in to two viz,Factors that prevent dissatisfaction - Hygiene factors.Factors that give satisfaction - Motivators (feeling of achievement, significance of growth) Maintenance factors Motivators1. Fair co policy and administration Opportunity to accomplish something significant.2. Supervisor knows the work Recongnition.3. Supervisors relationship Chance for development4. Peers relationship Opportunity to grow5. Fair salary Chance for increased responsibility6. Job security The job inself7. Subordinates relationship8. Personal life9. Status10. Good working conditionNeeds priority, to a great extent, characterizes the types of behavior. It will be either directed towardsachieving certain desirable positive goals, or conversely, towards avoiding other undesirable negativeconsequences. Thus, a question may arise as to what variables are perceived to be desirable goals toachieve and conversely undesirable conditions to avoid. In this connection a research study wasconducted by Frederick. Herzbergls of Case-Western reserve University and associates. This studyconsisted of an intensive analysis of the experiences and feeling of 200 Engineers and accountants in 9different companies in Pittsbrug area, U.S.A. During the structured interview. They were agreed to BSPATIL 36
    • desirable a few previous job experience in which they felt exceptionally good or exceptionally badabout jobs. They were also agreed to rate the degree to which their feelings were influenced for betteror worse by each experience which they described.In concluding the information from the interview, Herzberg concluded that there were two categoriesof needs essentially independent of each other affecting behavior indifferent ways. His findings are thatthere are some job conditions which operate primarily to dis-satisfy employees when the conditions areabsent, their presence does not motivate them in a strong way. Another set of job conditions operatesprimarily to build strong motivation and high job satisfaction, but their absence carely proves stronglydissatisfying. The first 80 job conditions has refused to as maintain or hygiene factors and second setjob conditions as motivational factors.HYGIENE FACTORS According to Herzberg there are 10 maintenance or hygiene factors. They are companypolicy and Administration technical supervision, inter-personal relationship with supervisors withpeers, with subordinates, salary, job security, personal life, working conditions and status. These arenot intrinsic part of job but they are related to conditions under which a job is performed. They produceno growth in a worker’s output; they only prevent prevent losses in workers performance due to workrestrictions. These maintenance factors are necessary to maintain a reasonable level to satisfactionemployees; however any cut below this level will dis-satisfactory them. As such these are also calleddis-satisfiers since any increase to these factors will not affect employee’s level of satisfaction. Hence,these are in no way motivation them.MOTIVATIONAL FACTORS These factors are capable of having a positive effort on job satisfaction often resulting inan increasing one’s total output. Herzberg includes 6 factors that motivate employees. These areachievement, recognition, advancement work itself, possibility of growth and responsibility. Most ofthese factors are related with job contents. An increase in these factors will satisfy the employees;however, any decrease will not affect their level of satisfaction. Since, thee increase level ofsatisfaction in the employees can be used in motivating them for higher output. Herzgerg maintains thatpotency to various factors is not entirely a function to factors themselves. It is also influenced by thepersonality characteristics to the individuals. From this point of view, individuals may be classified intotwo parts. Motivation seekers, maintenance seekers. The motivation seekers generally are individualswho are primarily motivated by the satisfier’s such as advancement, achievement and other factorsassociated with work itself. On the other-hand, the maintenance seekers tend to be more concernedwith factors surrounding the job such as supervision; working conditions, pay etc.The shortcomings of Herzberg’s theory are: 1. Infact job satisfaction and dis-satisfaction are two opposite points on a single continuum Individuals on the job are affected by any change either in the job environment or in the job content. 2. Herzberg model is method bound and a number of other methods used for similar study have shown different results not supporting his contentions other the theory has limitation is general acceptability. 3. This theory does not attach much importance to pay, status, or inter-personal relationships which are help generally as important contents of satisfaction. BSPATIL 37
    • Comparison of maslows and herzberg theoryMASLOW’S NEED THEORY HERZBERG THEORY M1. Self actualization O Challenging work, achievement, growth in T the job. I2. Esteem or status V A Responsibility, Advancement and T O recognition R M3. Social needs A Status, Interpersonal, working conditions. I N F Job security, salary5. Physiological needs T A E C N U A L N T C Y EMC GREGORE’S THEORYProf. Douglas Mc. Gregore has introduced a fresh dimension in the discussion on theories relating tomotivation. He has classified the prevalent theories into two groups viz., 1. Traditional or X theory and 2. Modern or y theory.Traditional or X theory. It completely excludes workers from the process of managerial decision making the theory stressthat would here only when forced to do so through ruthless exercise of managerial authority over themthrough constant rebuking scolding reprimanding. Decisions whether right or wrong have to be madeby managers only, the only rule assigned to workers being to mainly incline the decision.Assumptions of X theory 1. Lack of inclination to work. 2. Fear can alone force action. 3. Inbuilt dislike for responsibility 4. Living – off others. 5. Obession with security. 6. Money alone can make the people to work. 7. Labour is only a factor of production. 8. Authority is synonymous with control. BSPATIL 38
    • Modern theory or Y theoryIt is the exact opposite of x theory, it gives workers a pride of place in the process of management. Itemphasis fuel and active cooperation, between workers and management to accomplish the enterpriseobjectives as per theory if workers are properly maturated, they would willingly accept responsibilityand show the sense of creativity and imagination in their work performance. It can be said to bepositive and optimistic outlook.Assumptions of Y theory 1. Work is reward in itself 2. Inherent sense of responsibility 3. Recongnition. 4. Sense of security. 5. Financial reward is not the only inspiration. 6. Decision – making ability is not the monopoly 7. Democratically inclinedGROUP DYNAMICS Essentially dynamics is a branch of physics which means any matter in motion. It alsomeans a moral force that produce activity or change. Group dynamics means the action of a groupengaged in a common endeavor. The world dynamics comes from the Greek work meaning force. Thephrase Group Dynamics thus means a study of cohesive and disruptive force operating within a group. The importance of group dynamic to a manager lies in the fact that many people tent tobehave differently as individual and member of a group. The manager must thus study them both asindividual and as group, as these are two interrelated elements of a motivational situation. The groupdynamic will be structured around the three key element such as basic element of group behaviour,group cohesiveness and the group structure. The three basic elements which generally of use in understanding the behavior of a groupare activities, interactions and sentiments. Group cohesiveness refers to the degree to which itsmembers are attracted to the group, are motivated to remain in the group, and mutually influence onanother. Highly cohesive groups are more likely to conform to group pressures than are members oflow-cohesive groups. Group structure if meant that the nature and characteristics of theinterrelationships among the members of a group and the roles they play in it.THE EXPECTANCY THEORY OF MOTIVATION – VICTOR H. VROOM People will be motivated to do things to reach a goal if they believe in the worth of that goal andif they can see that what they do will help them in achieve it. Vroom makes the point that motivate is a product of the anticipated worth that an individualplaces on a goal and the chances the or she sees of achieving that goal. He states that: FORCE = VALENCE * EXPECTANCY Force = Strength of the person motivation. Valence = Strength of an individual preference for an outcome. Expectancy = Probability that a particular action will lead to a desired outcomes. BSPATIL 39
    • Basic concepts of the theory are : 1. First and second level outcomes. 2. Instrumentality 3. Expectancy 4. Motivation.Motivation is the multiplicative function of the valence for each first level outcome (Vi) and thebelieved expectancy (E) that a given effort will be followed by a particular first level outcome.Merits of Vrooms Theory are: 1. It recognizes the importance of various individual needs and motivations. 2. It fits the concept of harmony of objectives 3. It is completely consistent with the system of management by objectives.Demerits of Vrooms Theory are 1. Perception of value vary among individuals at different times and in various places. 2. Difficulty to apply the practice.THE PORTER AND LAWLER MODELLyman W Porter and Edward Lawler III derived a substantially more complete model of motivation.The strength of motivation and energy exected = value of reward + amount of energy required +probability of receiving reward.Motivation is an extremely significant subject for managers get work done through others. Importantcharacteristics of motivation are individual differ in their motivation, individuals are unaware ofmotivation sometimes, motivation may change and vary, motivation is a complex one. Maslow,Herzberg, Mc Gregore, V Room and Porter and Lawler are some the important writers on motivation. BSPATIL 40
    • LESSON – 6 COMMUNICATIONThe word communication originates from the latin word “communis” denoting common. It involvesimparting a common idea or understanding and covers any type of behavior resulting in an exchangeof facts, ideas, opinions, or emotions by two or more persons.Management tasks of planning, directing, coordinating and motivation can be carried out by the processof receiving issuing recording and interpreting.The information of facts and figures related to the varied aspects of business activities necessarilyimplies transmission of information intended to convey the idea of what is desired or required to bedone. This would necessitate determination of information to link all the leavels and enable theconcerned officers and operative to act upon such information. This process of transmitting informationas between different levels of authority and among the officers at the same level is calledcommunication. - Louise AllenCHARACTERISTICS OF COMMUNICATION 1. Giving information on matters regarding things done or to be done. 2. Receiving information on matters of actins expedited or yet to be expedted 3. Creating under standing in others about their responsibility and position and prospects of a situation concerning then. 4. Making others listen attentively to the facts, figures, views, opinions under transmissions. 5. Identifying the common intentions and interest by interaction of views through channels of commutations.IMPORTANCE OF COMMUNICATIONS Communication is described as one of the crucial fouls of management. It helps in handling the major managerial tasks of planning direction coordination motivating and controlling. It enables the top management. To formulate the comprehensive plans and policies on scientific basis. To put the policies and decisions into action results in accurate and efficient performance. Helps the management to remain informed to the problems difficulties, grievances of personnel. They arise mainly due to communication gap. It is essential for coordination which is the essence of management. It brings about mutual understanding between the officers and personnels at all levels and fosters the sprit of cooperation. It helps in securing largest possible participation or consumption indecision making, planning and general administration. This will give democratic character to managerial process and strengthen the moral of the staff. BSPATIL 41
    • ELEMENTS OF COMMUNICATION Communicator or sender or issuer. Communicate or rece4iver or addressee Message – orders reports Communication channel. Response – reply reaction.ESSENTIALS OR PRINCIPLES OF GOOD COMMUNICATION 1. Principle of clarity - It must give clear message n simple words and easily understandable form. 2. Principle of attention - 3. Principle of adequacy - It should be consistent with plans, policies program and objective of the enterprise. 4. Principle of adequacy - It must be a complete one. 5. Principle of time - It should be give at proper time. 6. Principle of integration - It should ensure cooperation at all levels. 7. Principle of informality 8. Principle of feed back - Communication must be a two way traffic message polices, programs, direction, opinions etc are communicated downwardGrievances, complaints and suggestions etc are communicated upward.TYPES OF COMMUNICATION On the basis of nature of passing information - Formal communication - Informal communication On the basis of direction i.e. flow of message : On the basis of mode of operation - Oral communication - Written communication - Gesture communication Each business house is concerned with two types of communication, external and internal. Externally, it has to communicate with the other business houses, banks, government officers. The press the customers and the general public Internal communication consists in transmitting information with in the organization. Here we discuss about internal communication. Internal communication may again the be f two types. 1. Formal or official 2. InformalFormal communication flows along prescribed channel which all members desires of communicatingwith one another are obliged to follow. Formally a clerk in any of the sections cannot directlycommunicate with the managing director. BSPATIL 42
    • He must talk to his supervisor who wil pass on the passage to departmental managers, from where itwill go to the managing director. Formal communication may more vertically or horizontally.Vertical communication can flow downward or upward. Horizontal communication flows betweenemployees of equal or comparable status. When a number of people irrespective of status sit down andconfer with another to arrive at a decision acceptable to all. It is called consensus. The format for thiscommunication is predetermined and cannot be altered.In addition to this formal channels of communication, there exists in every organization an informalchannel, often called a grape vine, that does not arise out of the organizational needs but that is neverthe less, an integral part of his communication system.DOWNWARD COMMUNICATION As explained earlier communication flows from a superior to a subordinate. The managingdirector communicating with the departmental heads. A manager giving a directive an assistantmanager or supervisor, a foreman instructing a worker. Orders, individual instructions policies, astatement job sheets, circular etc fall under downward communication. It is eminently suited to anorganization in which the line of authority runs distinctly downwards with each tank clearly belowanother t which it is directly related.Main objectives of downward communication 1. To give specific direction about the job being entrusted to a subordinate. The decision fallen at managerial levels are transmitted to states in the form of directives so an action may be initiated. 2. To explain the policies and organizational procedures. A clear understanding of policies given the lower state. A wider perspective so that they can grasp and relay their role more meaningfully. 3. To appraise the subordinates of their performance:If the performance of the subordinates is objectively assessed and the assessment communicated to himin a considerate tone, it will definitely promote efficiency. Appreciation to good work will raise hismorale and strengthen his dedication pointing out has shortcomings will enable him to over come them. 4. To give information about the rational of the job.i.e. To explain to a subordinate the significance of the job assigned to him and why he has beenentrusted with it. The importance of the objective of downward communication has only been recentlyrecognized.MEDIA FOR DOWNWARD COMMUNICATIONDownward communication may be both oral and written. Important directives to initiate action may becommunicated through letters policies and procedures may be announced house organs, manuals,bulletins etc, But the downward follow of communication is dominated by oral means.It is more natural to the foreman to issue oral instructions to his workers. BSPATIL 43
    • LIMITATION OF DOWNWARD COMMUNICATION 1. Under – Communication and over communicationDownward communication is often made by either under – communication or over communication i.e.a superior may either talk to little or too much about a job under communication may also involvedincomplete instructions, which will inevitably lead to unsatisfactory performance over communicationor talking too much, on the other hand may lead to the leakage of confidential information. 2. Delay :The lines of communication in downward communication being very long transmitting information tothe lowest worker in time – consuming process. By the time information reaches him it may have lostmuch of as significance, or it may have caused damaging delay. 3. Loss of information :Unless the communication is fully written, it is not likely to be transmitted downwards in its entirely. Apart of it is almost contains to be lost. 4. DistortionIn long lines of communication, information is not only distorted. Exaggerating making understatements giving unconscious taints to facts are a part of human nature. 5. Built – in resistanceDownward communication causes of too much authority flow. The subordinates do not get anyopportunity of participating in the decision making process they are expected to receive policydecisions and directive without questioning their appropriateness, utility or validity which they resent.ESSENTIALS OF EFFECTIVENESS DOWNWARDS COMMUNICATION. 1. Managers should keep themselves well informed of the objectives and achievements of their organization. It they are themselves in possession of adequate information, they will be also to transmit information to their re-subordinated in an effective manner. 2. Managers must work according to communication plan. They must decide before how much information is to be communicated and at what time. 3. There should not be over communication of authority at the highest level. If an organization is so structured that orders and instructions can originate at various levels, the lines of communication will be shortened. 4. The information must be passed on to correct persons inherently.UPWARD COMMUNICATIONIf the managers have transmit information down the lines of authority they have also to receiveinformation continuously emanation from levels below them the communication channel which pushesthe flow of information upwards is known as the upward channels of communications. Managers haveonly recently come to the recognize the importance of upward communication. BSPATIL 44
    • IMPORTANCE OF UPWARD COMMUNICATION 1. Providing feed backThis communication provides the management with necessary feed back. The management is able toascertain whether the directive issued the lower statuses have been properly understood and followed italso gets the valuable information on what the employees think of the organization and its policies. 2. Out let for the sent-up emotions:Upward communication is the employee and opportunity to sent their problems and grievances.Although the management often these things and it knows and realizes the grievances of theemployees, The later hardly feel convinced and satisfied. 3. Constructive suggestionsOften employees often constructive suggestion to promote the welfare of the organization. Some ofthese suggestion when implemented definitely prove beneficial. They develop source of participation inthe decision making process. 4. Easier introduction of new schemesSince the employees feels themselves to be party to the decision making process, it helps theorganization to introduce new schemes without unduly antagonizing the employees. 5. Greater harmony and cohesion :It art as a kind of lubricant. It makes the atmosphere more congenial are creates great harmony andcohesion between the management and the employees.METHODS OF UPWARD COMMUNICATIONSome of the more commonly used methods of upward communication are discussed below. 1. Open door policy:The employees are given a feeling that the managers doors are always open to them, whenever the likethey can walk in to his room, without any hesitation what so where and talk to him about theirproblems. 2. Complaints and suggestions boxes:In some convenient places n the offer or the factory complaints and suggestions boxes are installed.The employees are encouraged to drop their complaints or suggestion if any, in to these boxes. Theseboxes are opened at regular intervals and the inform gathered scrutinized. 3. Social gatherings:Social gathering are frequently arranged in different departments. These gatherings offer a veryinformal atmosphere in which ate employees shed the inhibitions and feel free to talk about theirproblems. BSPATIL 45
    • 4. Direct correspondence:Some times the manager may directly write to an employees and ask him to communicate with him. 5. Reports:Employees may be required to submit repatriates about the progress of their work a regular intervals. 6. CounselingIn some organization workers are encouraged to seek the counsel of their superiors on their personalproblems. As they feel encouraged to talk about themselves freely, they provide the managers withvaluable information.LIMITATIONS OF UPWARD COMMUNICATIONThe shortcomings of the upward communication are: 1. Employees are usually reluctant to initiative upward communication. The managers might keep their doors open, but they cannot force the employees to walk in to their problem. 2. Employees often feel that if they communicate their problems to their superiors, it may adversely reflect on their own efficiency. 3. Upward communication is more prone to distortion them downward communication. In downward communicate distortion is often unconscious. But upward communication is deliberately distorted. 4. Sometimes in the process of upward communication, workers become to bold, ignore their immediate superiors and directly approaches the top most authorities with their suggestions or complaints.ESSENTIALS OF EFFECTIVE UPWARD COMMUNICATION 1. In order to enable the workers to over come the awe of authority, the managers should keep on encouraging them to come out of their shell and communicate freely. 2. Distortion by editing can be avoided if the lines of communication are kept as shortest possible. 3. All communicate should be properly analyzed genuine grievances deserve to be immediately resolved.HORIZONTAL COMMUNICATIONCommunication between departments or people on the same level in the managerial hierarchy of anorganization may be termed as horizontal or lateral communication. It is the most frequently usedchannels of communication. Workers communicating with one another, &&&&&&& exchanginginformation with one another, supervisors holding a coffee break section s to discuss some organizationare all engage in horizontal communication.Diagrammatical representation of horizontal communication BSPATIL 46
    • Production Purchase Accounts Sales Public relations AdministrationIMPORTANCE OF HORIZONTAL COMMUNICATION Horizontal communication is extremely important for promoting understanding andcoordinating among various departments. Not much imagination is needed to visualize he embracingsituations that the lack of co-ordination might create for the organization. The purchasing departmentmight keep on purchasing material which is neither immediately needed nor can be adequately stored.The stores may report shortage of material when production is fully given up. Scarcity of raw materialmay cause the production to slow down but the sales department may continue booking orders freeflow of horizontal communication among various departments can easily avert the incidents of suchsituations. In a small organization these functions are concentrated the same person or in the few personwho are stationed in close proximity to one another. They do not face any communication problem forthe moment problem crops up, it is thronged out through mutual consultation. But in large organizationwith complex routines, a deliberate effort has to be made to maintain a free of horizontalcommunication. Some managers discourage horizontal communication feeling that workers may getfriendly with one another and may tops and insist on their unqualified acceptance.METHODS OF HORIZONTAL COMMUNICATION Horizontal communication is most effectively carried on through oral means. Face to faceexchanges of views or a brief conversation over the telephone in very convenient for horizontalcommunication. Formal channels tend to move managers status conscious so that they express theirview in extremely measured items. This includes the free flow of communication takes place allowfreedom of expression there is immediate feed back and all doubts and misunderstanding are sorted out.GRAPEVINE So for we have been discussing the formal channels of communication which follow certaindefinite predetermined directions apart from them, they operates in every organization an informalchannel of communication called the grapevine. It follows no set lines, nor any definite rules, butspreads like the grapevine, in any direction any where and spared fast. It is quite natural for to group of people working together to be entrusted in one another andtalk about appointments promotions retrenchments or even domestic affairs like the estranged relationof an employee with his wife or the romantic involvements of another. Information on most of thesematters is supposed to be secret. But some people drive great pleasure from gathering such “secret”information ad transmitting it to others. They are the leaders who control the grapevine. When one ofthem come across any peace of information interesting enough to be transmitted to the grape vine in avery mysterious manner he whispers it to another exhorting him to keep the information secret.Keith davis rightly pointed out that the grapevine is more a product of the situation then it is of the BSPATIL 47
    • person. The grapevine is basically a channel of horizontal communication, for it is only people workingat the same level of hierarchy who can informally communicate with one another with prefect case.Thus the workers may have one grapevine and the first line supervisors another. But the fact is that thegrapevine does not follow any set pattern and it can be effective horizontal, vertically, and evendiagonally.HOW THE GRAPEVINES OPERATES Professor Keith davis who has done some research in the nature of grapevine or the informalchannel of communication classifies in the four basic types: Single strand, Gossi, Probability and Cluster.The single strand chain involves the passing of information through a long line of persons to theultimate recipient. A tells B who tells C who tells D and son on, till the information has reached mostof the persons concerned. In the gossip chain, A actively seeks and tells every one. This chain is justlike the wheel where A is at the centre and the information passes along the spokes of the wheel toothers stationed on the rim. The probability chain is a random process in which a transmits theinformation to others in accordance with the law of probability and them these others tell still others ina ultra manner. This chain may also be called random. In the cluster chain, A feels selected personswho may in turn relay the information communication follows this chain.A model if different forms of grapevines are depicted in the chart.IMPORTANCE OF THE GRAPEVINE 1. Safety value:Apprehension experienced by workers on matters like promotion and retrenchments become anobsertion with them. Talking about them may not alleviate their fears, but it certainly provides thememotional relief. Since the grapevine does not follow any formal channel, nobody can held accumulatefor any thing he has said.TYPES OF INFORMAL CHANNELS OF COMMUNICATION While relaying the information to another fellow, a person is quit free to give it any twists he likes. BSPATIL 48
    • This twists helps him to express his personal emotions. Thus the grapevine act as a kind of safety value for the dent up emotions of the subordinates. 2. Organizational solidarity and cohesion : The existence of grapevine provides that the workers are interest in the associates. The very facts that they talk among themselves helps to promote organizational solidarity and cohesion. Properly used grapevine may even raise the morale of the workers. 3. Supplement to other channels :All information cannot be transmitted to the employees through he official channels. If there is someuseful information and suitable for being transmitted through officials channels. It can be transmittedthrough the grapevine. Thus the grapevine supplements others channel of communication. 4. Twice Transmission :The speed with which information is transmitted through the grapevine is just remarkable. 5. Feed Back:The grapevine provide feed back to the management. It enable them to know what the subordinatesthink about the organization and its various activatesDemerits of grapevine: 1. Distortion : One of the major drawbacks of the grapevine is that it may speed baseless or distorted news which may sometimes prove harmful even to the employees. 2. Incomplete information: The grapevine information is usually incomplete. So here is lively likelihood of its being misunderstood or misinterpreted. 3. Damaging swiftness: The swiftness with which the grapevine transmits information may even be damaging.BARRIERS IN COMMUNICATIONTheir might be a number of such barriers impeding the flow of communication in the organization.This may be classified as (i) External (ii) Organizational, (iii) Personal factors.EXTERNAL BARRIERSBarriers to communication may be either external to the parties involved or they might be internal tothem. 1. Semantic barriers :Semantic barriers are obstruction caused in the process of receiving or understanding of the message BSPATIL 49
    • during the process of encoding and decoding ideas and words. - Badly expressed message. - Faulty translations - Un-clarified Assumption. - Specialist’s language. 2. Emotional or psychological barriersEmotional or psychological factors are the prime barriers in inter-personal communication. Themeaning ascribed to a message depends upon the emotional or psychological status of both the partiesinvolved.- Premature evaluation.- Inattention- Loss by transmission and poor retention.- Undue reliance on the return word.- Distrust of communicator.- Failure to communicate. 3. Organizational barriers :An organization being a deliberate creations for the attainment of certain specified objectives, day-to-day happening within it require being regulated in such a manner that they contribute to attain theseobjectives in the most efficient manner.- Organizational policy- Organizational rules and regulations.- Status relationships.- Complexity in organization structure- Organizational facilities. 4. Personal barriers :While the organizational factors discussed above are, no doubt important influences operating oncommunication, a host of factors internal to the two parties-sender and receiver-to this process alsoexert important influences on its operation, s communication is basically an inter – personal processes.METHODS OF OVERCOMING THE BARRIERS Considering the importance of effective communication in the successful functioning ofbusiness organizations, it is essential on the part of the management to overcome these barriers. 1. It is imperative that organizational policy must be clear explicit and encouraging the communication flow so that people at all levels realize the full significance of communication. 2. This policy should also specify the subject matter to be communicated. 3. Though the communication through proper channel is essential for orderly flow of information. BSPATIL 50
    • 4. Even person in the organization shares the responsibility of good communication. 5. Organization should have adequate facilities for promoting communication. 6. Communication being an inter-personal process, the development of inter-personal relationship based on mutual respects, trust and confidence is essential for its promotion. 7. There should be continuous programme of evaluating the flow of communication in different directions.Thus communication may be defined as the process of passing information and understanding from oneperson to another. Communication provides employees both the skill to work and the will to work. Itmay be formal and informal. Whether it is formal or informal it must be done in a proper manner toserve the purpose. Ideation, encoding, transmission, receiving, decoding and acting are some ofimportant steps in communication process. Badly expressed messages, faulty organization, distrust ofthe communicator, restricting communication, poor retention, different backgrounds are called asbarriers to effective communication. BSPATIL 51
    • Lesson – 7 LeadershipLeadership is an abstract quality in a human being to induce his followers to do whatever he is directedto do with the zeal and confidence.Leadership is generally defined simply as the art of influencing people so that they will strive willinglytowards the achievement of group goals. KOONTZ & O’ DONNELIMPORTANCE OF LEADERSHIP 1. Driving force group efforts. 2. Aid to authority 3. Better utilization of man power. 4. Basis for co-operation.INGREDIENTS OF LEADERSHIP- Ability to use power effectively and in a responsible manner.- Ability to comprehend the temperaments of human beings.- Ability to inspire.- Ability to act in a manner that will develop a climate conducive to and arousing motivations.LEADERSHIP QUALITIES I. Physical qualities 1. Sound health to fulfill his obligation. 2. Vitality and endurance to face al hardships. 3. II. Psychological qualities. 1. Personal magnetism 2. Enthusiasm. 3. Co-operation. 4. Exerting 5. Resourcefulness. 6. Ability to inspire and integrate. 7. Tact and skillful handling. III. Intellectual traits 1. High degree of intelligence. 2. Sound judgment. 3. Capacity to deal with every situation. 4. Scientific approach. 5. Open mind. 6. Best teacher. BSPATIL 52
    • IV. Qualities of character 1. Integrity 2. Self discipline 3. Good natured 4. Willingness to work hard. 5. Willingness to accept and share responsibilities.APPROACHES TO STUDY OF LEADERSHIP : A. Personal Trait Approach This approach says that all of us are possessing certain abilities and share responsibilities. Such qualities are considered as god given and hence leaders are born. B. Situational / Contingency approach : (Fielder’s model) :This is viewing that leadership qualities are determined by the situation in which he/she operates. It isnot individuals characteristics. C. Group approach :A leader is one who comes attuned to he feelings and actins of people whom he is supposed to lead.Thus, the leader is one who comes closest to living up to the norms and standards of his group. D. Path goal theory:It suggests that the main functions of the leader is to clarify and set goals with subordinates the themfind the best path for achieving the goals and remove obstacles.Leader behavior may be grouped into four : 1. Supportive leadership. 2. Participative leadership. 3. Instrumental leadership. 4. Achievement oriented leadership.TYPES OF LEADERSHIPFrom the point of view of authority, leadership can be autocratic and democratic or free rein.AUTOCRATIC LEADERSHIPThe leader alone determines policies and makes plans. He demands strict obedience and relies onpower.Merits:1. It can increases the efficiency, save time and get good result.2. It works well employees who have a low tolerance for ambiguity feel insecure withfreedom.3. Chain of command, and division of work are clear and full understood by all. BSPATIL 53
    • Demerits : 1. One – way communication may create costly errors. 2. Individual decision making may be dangerous in the changing environment. 3. Resentment in form of massive resistance, low morale and low productivity.DEMOCRATIC LEADERSHIPThe entire group is involved in and accepts responsibility for goal setting and achievement.Subordinates have considerable freedom of action.Merits : 1. The leader has the built-in personal motivation working for him. 2. The leader consistently receives the benefit of the best information, ideas, suggestions and talents of his people.This style permits and encourages people to develop grow and rise in the organization.Demerits : 1. Time consuming. 2. Leaders may avoid responsibility.Free rein leadership :Leader exercises absolutely no control. He provides only information, materials and facilities to himen to enable them to accomplish group objectives. This type does not hold good when the leaderdoes not know well the competence and integrity of his people and their ability to handle this kind offreedomSpectrum of Leadership Styles :Leader centered Participative Employee centered[Autocratic] [Democratic] [Laissez faire] Area of freedom permitted to subordinates1 2 3 4 5 6 7 BSPATIL 54
    • This spectrum depicts that a leader can adopt number of ways to relate himself with a group. The leftside of the spectrum emphasizes that his style is leader centered. Such leaders are more care aboutproduction than for the welfare of his subordinates.The right side of the spectrum denotes that the leadership style employee centered. They care aboutmore for the welfare of their subordinates than for production.The centre of the spectrum finds a more equitable balance between the authority exercised by the leaderand the amount of participation the grotto exercise.The different scales in the spectrum describe the following :Point 1 : Leader makes decision and announces it.Point 2: Making the subordinate to accept the decision.Point 3: Leader presents his idea and initiate discussion.Point 4: Presents tentative decision subject to change.Point 5: Present the problem, gets opinion and makes decision.Point 6: Leader allows the group to make decision within limits.Point 7: Leader allows the group to make decision within limits defined the situation.MANAGERIAL GRID It is a form of continuum which emphasize that leadership style consist of factors of both thetask-oriented and people relations oriented behavior in variying degrees. It explains that whatever maybe the type of leadership styles it ultimately relates with tasks to e performed and people with whom itis to be performed. Some styles emphasize on concern for production which means that the attitudes ofsuperiors towards a variety of things, such as, quality of policy decisions, procedures and processes,creativeness of research, quality of staff service, work efficiency and volume of output. On the otherhand there are certain leadership styles which emphasize on concern for people which means thatdegree of personal commitment towards goal achievement, maintaining the self-esteem of workers,responsibility based on trust, and satisfying inter-personal relations, Based on these two factorsleadership styles can be identified n to 5 types as given in the diagram. 1.9 9.99876 5.554 BSPATIL 55
    • 321 1.1 9.1 1 2 3 4 5 6 7 8 9 Low Concern for Production High This managerial grid concept has been developed by Blame and Mour The 5 styles depicted bythe diagram are : 1.1 Impoverished style where exertion of minimum effort is require get work done and sustain organization morale.1.9 Country club style where thoughtful attention to needs of people leads to friendly and comfortableorganization atmosphere and work tempo. 9.1 Task oriented style which says that efficiency results from arranging work in such a way that human elements have little effect. 9.9 Team model style which highlights that work accomplished is from committed people with interdependence through a common stake in organization purpose and with trust and respect. 5.5 Middle Road style rightly pointed out that adequate performance through balance of work requirements and maintaining satisfactory morale.Among the five different styles, the most desirable leader behaviour is 9.9. So efforts have to be takenby developing suitable training programs that attempts to change managers towards 9.9 leadershipstyle. Managerial gird helps the managers to identify and classify managerial styles and it helps tounderstand why he gets the reaction that he does from his subordinates. However, the mid point of thegrid i.e. 5.5 is highly emphasized in the pure form of working conditions.To summarize, leadership may be defined as the ability to influence and direct the task-relatedactivities of the members of group. A leader is a goal-setter, planner, executive, expert, grouprepresentative, administrator of rewards and punishments and a symbol of the group. There are threeapproaches to the study of leader ship such as. The trans approach, Behavioral approach andContingency approach. In that Behavioral approach has emphasized different leadership styles. BSPATIL 56
    • LESSON – 8 CO-ORDINATIONIt is the integration, synchronization or orderly pattern of group efforts in the enterprise towards theaccomplishment of objectives. It may be defined as balancing and keeping the teams together byensuring a suitable allocation of working activities to the various members and seeing that they areperformed with due harmony among the members themselves.NEED FOR COORDINATION • Systematic sequence of operation • Fulfillment of activities as per planned schedules • Avoidance of interruptions in the operations • Eliminating inconsistencies in objectives and policies • Removal of conflicts among individuals • Developing the team spirit and cooperation.ADVANTAGES OF CO-OPERATION 1. Increases the efficiency, Increases in the productivity, economizing the activities etc. 2. Improve the morale of the employees 3. Develop and retain good personnelTYPES OF CO-ORDINATION 1. Internal co-ordination. It is the establishment of relationship with a view to coordinate the employees of all the departments. It may be vertical or horizontal. 2. Eternal Co-ordination. It refers to establishment or relationship with a view to coordinate the activity of those who are not part of the organization.PRINCIPLES OF COORDINATION 1. Early beginning 2. Direct contact 3. Reciprocity 4. ContinuityTECHNIQUES OF COORDINATION“A manager in managing must coordinate the work for which he is accountable by balancing, timingand integrating. Balancing - Support, Timing - Time schedule BSPATIL 57
    • Integrating - UnificationPROBLEMS OF COORDINATION - Complex organizational structure - Improper communication - Higher labour turnover - Lack of motivation and morale - Favoritism - Red-tapism - Improper leadership - Weak public relations BSPATIL 58
    • LESSON – 9 CONTROL SYSTEM AND PROCESSCONTROLLING Control is any process that guide activity towards some predetermined goals. Thus control canbe applied is n any field such as price control, distribution control pollution control etc. Thus controlprocess tries to find out deviations between planned performance and actual performance and tosuggest corrective action wherever these are needed. For example terry has defined control as follows :“controlling is determining what is being accomplish, that is evaluating the performance and, ifnecessary, applying corrected measures so that the performance takes place according to plan.Control is checking event performance against pre-determined standards contained in the plans, with aview to ensuring adequate progress and satisfactory performance.Controlling consists in verifying whether everything occurs inconformity with the plan adopted, theinstructions issued and principles established. Its object is to point but weakness and errors in order torectify them and prevent recurrence. 1. Control is forward looking 2. Control is both executive process and from the point of view of the organization of the system, a result 3. Control is a continuous process. 4. A control system is a coordinated – integrated system.IMPORTANCE OF CONTROL Thus control is an integrated action of an organization or manager. It offers help in thefollowing directions. 1. Adjustment in operations A control system acts as an adjustment in organizational operations. Every organization has certain objectives to achieve which become the basis for control. 2. Policy verificationVarious policies in the organization generate the need for control. For organizational functioning,managers set certain policies and other planning elements which later become the basis and reason forcontrol. 3. Managerial responsibilityIn every organization, managerial responsibility is created through assignment of activities to variousindividuals. This process starts at the top level and goes to the lower levels. BSPATIL 59
    • 4. Psychological pressureControl process puts a psychological pressure on the individuals for the better performance. Theperformance of the individuals is evaluated in the light of targets set for them. 5. Coordination in actionControl system area designed n such a way that they focus not only on the operating responsibility of amanager but also on his ultimate responsibility. This forces a manager to co-ordinate the activities ofhis subordinate in such a way that each of them contributes positively towards the objectives of thesuperior. 6. Organizational efficiency and effectivenessProper control ensures organizational efficient and effectiveness various factors of control, namely,making managers responsible, motivating them for higher performance, and achieving coordination intheir performance, control, ensures that their organization works efficiently.STEPS IN CONTROLLINGThe various steps in control process which are necessary for its relationship to planning. This steps maybroadly be classified into four parts. 1. Establishment of control standards 2. Measurement of performance 3. Comparison between performance and standards and the communication and 4. Correction of deviations from standards (1) Establishment of control standardsEvery function in the organizations begins with plans which are goals, objectives or targets to beachieved. In the light of these standards are established which are criteria against which actual resultsare measured. (2) Measurement of performanceThe second major step in control process is the measurement of performance. The step involvesmeasuring the performance in respect of a work in terms of control standards. (3) Comparing Actual and Standard PerformanceThe third major step in control process is the comparison of actual and standard performance. Itinvolves two steps- finding out the extent of deviations and- identifying the causes of such deviations. BSPATIL 60
    • (4) Correction of deviationsThis is the last step in the control process which requires that actins should be taken to maintain thedesired degree of control in the system or operation.ESSENTIALS OF EFFECTIVE CONTROL SYSTEMControl is necessary in every organization to ensure that everything is going properly. Every manager,therefore, should have an effective and adequate control system to assist him in making sure that eventsconform to plans.In this tailoring of control system, there are certain requirements which should be kept in mind. 1. Reflecting Organizational Needs ;All control systems and techniques should reflect the jobs they are to perform. 2. Forward Looking :Control should be forward looking. Though many of the controls are instance, they must focusattention as to how future actions can be conformed with plans. 3. Promptness in Reporting DeviationsThe success of a thermostat lies in the fact that it points the deviation promptly and takes correctiveactions immediately. 4. Pointing out Exceptions at Critical points :Control should point exception at critical points and suggest whether action is to be taken for deviationsor not. 5. Objectives :The control should be objective, definite and determinable in a clear and positive way. 6. FlexibleControl system should be flexible so that it remains workable in the case of changed plans, unforeseencircumstances or failures. 7. EconomicalControl should be economical and must be worth its costs. Economy is relative since the benefits varywith the importance of the activity, the size of the operation the expense that might be incurred in theabsence of control and the contribution the control system can make. BSPATIL 61
    • 8. SimpleControl system must be simple and understandable so that all managers can use it effectively. 9. Motivating :Control system should motivate both controller and controlled 10. Reflecting Organizational Pattern:The control should reflect organizational pattern by focusing attention on positions in organizationstructure through which deviations are corrected.Feed back loop of management control Desired performanceImplementation of Actualcorrections performanceProgramme of Measurement ofcorrective action performanceAnalysis of causes Comparison of Performance Identification of deviations.TECHNIQUES OF CONTROL BSPATIL 62
    • To control the activities in the organization, managers can use variety f tools and techniques. They arebroadly grouped under two heads. 1. Traditional techniques. 2. Modern techniques.Traditional techniques are those which have long been used by the managers. Some of the importanttechniques under this heads are budgetary control, financial statement and ratio analysis, auditing,break-even analysis and report writing etc.“Budgetary control is a process of comparing the actual results with the corresponding budgeting datain order to approve accomplishments or to remedy differences by either adjusting the budget estimatesor correcting the cause of the difference.” - GEORGE R TERRYThe different budgets such as production budget, sales budget, overhead budget, labour budget etc.clearly indicate the limits for expenses and also the results to be achieved in a given period. It ensureseffective co-ordination of the work of the entire organization. It promotes co-operation and team spiritamong the employeesStandard Costing is one of the techniques of cost control and it is being increasingly used by modernbusiness concerns for the purpose of cost reduction and cost control. It involves a comparison of actualwith the standards and the discrepancy is called variance.Break-even analysis is useful in planning and control because it emphasize the marginal cost andbenefit concept. It helps to make profit estimation at the different levels of activity, ascertainingturnover for desire profit and estimating the impact of the variations of fixed and variable costs. Itmagnifies a set of relationships of fixed costs, variable cost, price, level of output and sales mix to theprofitability of the organization.Financial statement analysis such as Found Flow analysis, Cash Flow analysis and Ratio analysishelp to know the financial performance and financial position of the business unit. The liquidity,profitability and solvency position of the business unit can be ascertained and efforts can be taken tomaintain these factors in an optimum proportion,Auditing is the process of investigating financial and other operation of a business establishment. Itmay be carried out by internal and external members. It helps to scrutinizes the applicability andrelevance of policy, procedure and method which have a tendency to become obsolete. This it helps inchoosing a suitable working procedures and methods.Adoption of reporting system helps to analyse a particular problem and to take necessary correctiveaction over it. Reports may be prepared regarding taxation, legislation and its effect on profit, make orbuy decisions, replacement f capital equipment, social pricing analysis etc.A manager can also exercise effective control over his subordinates by observing them while they areengaging in work. Personal observation helps the managers not only in knowing the workers attitudetowards work but also n correcting their work and method, if necessary. BSPATIL 63
    • MODERN TECHNIQUESThese are of recent origin, which provide information not readily available with traditional methods.These techniques help to give sharper focus and promise increasingly to improve the quality of control.Program Evaluation Review Technique (PERT) and Critical Path Method (CPM) are two majortechniques coming under this head.PERT has been, developed by an U.S. Office in 1958 in connection with the Polaris Weapon Systemand is credited with reduction the completion time of the program by two years. CPM has been jointlydeveloped by DUPoint and Remington Rand USA in order to facilitate the control of large, complexindustrial projects. These techniques are used to minimize total time, minimize to cost, minimize idleresources etc. It is helpful in solving problems of scheduling the activities of on-time projects. Thesetools re widely being used in construction industry, planning and launching a new projects, schedulingship construction etc. It ensures improved management of resources by facilitating better decisionmaking. It aims to have future oriented control mechanism for the organization.Management Information System provides needed information to each manager at the right time, inright form which aids his understanding and stimulate his action. MIS is a refined form of traditionalinformation collection and supply to the organization points.Management Audit is an evaluation of management as a whole. It examine the total managerialprocess of planning, staffing, directing and controlling. To evaluate the management achievement, theorganization plans, policies, procedures, organization structure, system of control personnel relationshould be measure with its end results.1. Budgetary control - Financial performance2. Cost control - Cost performance3. Production control - PERT CPM Production, performance, quality4. Inventory control - Stores function performance5. Profit & Loss Control ROL control - Overall organizational objective performance.6. External audit control - Statutory performance7. Management self audit - DIRECT CONTROL VERSUS PREVENTIVE CONTROLDIRECT CONTROL: 1. Cause of negative Deviations from standards. Un certain, Lac of knowledge, experience or judgment 2. Questionable assumptions underlying direct control Assumption that that performance can be measured Assumption that personal responsibility exists Assumption that time expenditure if warranted BSPATIL 64
    • Assumption that mistake can be discovered in time Assumption that the person responsible will take. Corrective steps.PREVENTIVE CONTROLAssumption : Qualified managers make a minimum of errors. Management fundamental can e used to measure performance Application of management fundamentals can be evaluated.Advantages : 1. Greater accuracy 2. Encourage self control 3. Lighten the managerial burden 4. ImpressiveThus control is a very important process through which managers ensure that actual activities confirmto planned activities. It is mainly used to measure progress, to uncover deviations and to indicatecorrective action.MANAGEMENT BY OBJECTIVESIt is a process whereby the superior and subordinate managers of an enterprise jointly identify itscommon goals, define each individual’s major areas of responsibility in terms of the results expected ofhim and use these measures as guides for operating the unit and assessing the contribution of each of itsmembers. - GEORGE S. ODIORNEMBO is comprehensive managerial system that integrates many key managerial activities in asystematic manner and that is consciously directed toward the effective and efficient achievement oforganizational and objective.MBO PROCESSStep – 1: Set down informally the goals of the enterprise.Step – 2: Objective the goal so set out and define measures of performance.Step – 3: The goals and sub-goals at all management levels must them be set out.Step – 4 : Adjustment in the organization structure.Step – 5: The goals to be set at all levels must be joint and agreed ones. BSPATIL 65
    • Step – 6: Continuous feedback from appraisal of internal Goals and the enterprise goal as it is set.Step – 7: Appraisal of results proceed continuously against the goals at all levels.Step – 8: Review of sub-results throws light on organization results.BENEFITS OF MBO 1. Improvement of managing 2. Clarification of organization. 3. Encouragement of personal commitment 4. Development of effective controls.WEAKNESS OF MBO 1. Failure to teach the philosophy of MBO 2. Failure to give guidelines to goal setters. 3. Difficulty of setting goals 4. Emphasis on short-term goals 5. Danger of inflexibility 6. Other dangers.MANAGEMENT BY EXCEPTION (M.B.E.)It is a system of identification and communication that signals the manager when his attention isneeded: conversely, it remains silent when his attention is not required.The primary purpose of such a system is to simplify the management process itself.It permits the manager to find the problems that need his action and to avoid dealing with these the arebetter handled by his subordinates.ELEMENTS OF MBEThe MBE system’s structure is constituted by the following elements1. Measurement - by assigning values to performance2. Projection - towards business objective & expectations.3. Selection - follow progress towards its objectives4. Observation - to know current state of performance.5. Comparison - actual with expected and identify the exceptions.6. Decision making - Prescribes the action that must be fallen in order (i) Bring performance back into control (ii) Adjust expectations to reflect changing BSPATIL 66
    • conditions (iii) Exploit opportunityIt is also deeply rooted in the principles of the decision of labour, delegation or responsibility andauthority and span of control.MeritsThe practice of MBE in management yields benefit in the following way : 1. It save personal time 2. Concentrative executive effort 3. Reduces distortions 4. Facilitates broader management coverage 5. Lessens frequency of decision making. 6. Makes fuller use of knowledge of trends history and available business data. 7. Fully utilizes highly paid people on high-return work. 8. Identify crises and critical problems. 9. Provides qualitative and quantitative yardsticks for judging situations and people. 10. Enables inexperienced managers to handle new assignments with a minimum of related experience and training. 11. Alerts management to opportunity as well as difficulties. 12. Encourages more comprehensive knowledge of all phases of business operations. 13. Stimulates communication between different segments of an organization. Demerits : Peter Druker’s critically viewed MBE as follows : 1. It breeds organization man thinking 2. It is often dependent upon unbelievable data. 3. It rewires a comprehensive observing and reporting system. 4. It tends to proliferate paper work 5. It often assumes an un relational stability in business affairs. 6. It gives false sense of security to management. 7. Standard of comparison tend to become obsolete. 8. Some critical business factors are difficult to measure 9. It can’t be a substitute for thinking.PRINCIPLES OF MBEThe make the MBE system effective the following principles may be followed. 1. Practice of Self-control 2. Discard pre-conceived notions. 3. Be guided by policy 4. Learn to live with accountants. 5. Delegate for result. 6. Sharpen your observational power BSPATIL 67
    • 7. Use MBE to describe subordinates in different phases.8. Invite enough participation9. Expect some people to call you lazy10. Differentiate between “Big” and “Little” jobs11. Don’t be an “Over-the-Shoulder” supervisor12. Avoid the “organization – man” attitude13. Expect to work harder but to enjoy it more. BSPATIL 68
    • MODEL QUESTION PAPER Time : 3 Hours (Max : 100 Marks) Part – A (5 X 8 = 40) Answer any 5 questions1. Are Management and administration different? Explain.2. Explain the Characteristics of management as profession?3. What do you mean by planning premises and how it can be made effectively?4. What do you mean by Span of Management?5. Distinguish between “Delegation” and Decentralization”?6. Discuss the principles of effective directing?7. What is Group Dynamics?8. What is managerial Grid? Part – B (4 X 15 = 60) Answer ay 4 Questions1. Discuss the significance of leadership as an integral part of management. Explain different leadership styles.2. What do you mean by Management Control? Explain the Control process is an organization.3. Define Communication and describe the important steps is a communication process Explain the principal barriers to communication.4. Discuss the merits and demerits of different types of organizational structure.5. Explain the significance of different approaches of management in management theory. BSPATIL 69
    • PRINCIPLES OF MANAGEMENTTime : Three hours Maximum : 100 Marks Section A – (5 x 8 = 40 marks) Answer any FIVE questions. All questions carry equal marks. 1. Explain the nature of management? 2. Discuss in detail, the differences between formal organization and informal organization. 3. What do you mean by programmed and non-programmed decisions? 4. What are the characteristics of organization? 5. What are the techniques of direction? 6. Explain the different levels of management? 7. What are the problems of co-ordination? 8. What are the different types of planning 9. Explain the functions of management? 10. Explain the significance of planning? 11. What are the barriers to communication? How can one overcome them? 12. Explain Herzberg’s Motivation-Hygiene theory? 13. Write in short the different steps in control process? 14. Explain the principles of direction? 15. What are the different types of co-ordination and explain any two of them in detail? PRINCIPLES OF MANAGEMENTTime : Three hours Maximum : 100 Marks Section A – (5 x 8 = 40 marks) BSPATIL 70
    • Answer any FIVE questions. All questions carry equal marks.1. Define Management-State the importance of Management?2. Explain different types of decision?3. What is planning? Explain in the nature of planning?4. Explain span of control?5. Define Authority and Responsibility?6. What is meant by motivation? What are the non-monetary factors of motivation?7. What are the qualities of good leadership?8. Explain the need for control? SECTION B – (4 x 15 = 60 marks) Answer any FOUR questions. All questions carry equal marks.9. Explain the modern approaches of Management?10. Discuss the various steps to be followed in planning?11. What are the barriers to effective communication? How to overcome the barriers to communication?12. Explain Maslow’s theory of motivation?13. Explain different theories of Leadership?14. Explain the principles of co-ordination and techniques to be used for effective co-ordination?15. What is control? What are its steps? What are the techniques of control? BSPATIL 71