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Overview of Management - Management Process

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Management process is a subject by itself. In that the overview of management is shared with you.

Management process is a subject by itself. In that the overview of management is shared with you.

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  • 1. MANAGEMENT PROCESS Overview H Ramasubramanian (HRS)
  • 2. OVERVIEW OF MANAGEMENT Definitions of management Key aspects of management process Resource, Management Function, Attainment of Organisational Goals Role of management, including Mintzberg’s 10 managerial roles; Functions of management: Planning, organising, staffing, leading, controlling; Levels of management: Top, middle, and first levels, functions at various levels of management Top Management responsibilitiesleader, vision, decisions, management, board development; middle management; first level Approaches to management: • Empirical/ case approach; • Interpersonal behaviour approach; • Group behaviour approach; • Cooperative social systems approach; • Socio clinical system approach; • Contingency/ situational approach; • Managerial roles approach; • McKinsey’s 7S framework; • Operational approach. • Their characteristics and evaluation. Management skills and organisational hierarchy: • Technical skills; • Human skills; • Conceptual and design skills; • Their relative combinations at various managerial levels. Overview of management - MANGEMENT PROCESS 2
  • 3. Overview of management - Definition of Management • Definition – The organisation and coordination of the activities of an enterprise in accordance with certain policies and in achievement of clearly defined objectives. – Includes as one of the factors of production – along with machines, materials and money. • The basic task of a management – Peter Drucker 1. Marketing 2. Innovation • Marketing: Is a key essence for business success • Innovation: Product / Process innovation is a central strategic marketing issue. • • Key aspects of management process Resource: Manipulation of the human capital of an enterprise. – This implies • effective communication • Human motivation • Successful progress or system outcome. Overview of management - MANGEMENT PROCESS 3
  • 4. Overview of management - Definition of Management • Manipulation: Not of a mechanism (machine or automated program) • Not the herding of animals • Management must have humans, communication and a positive enterprise endeavour. Management Function – Henry Fayol (1841-1925) one of the most influential contributor to modern concept of management. – 6 functions 1. Forecasting 2. Planning 3. Organising 4. Commanding 5. Coordinating 6. Controlling – Towards the end of 20th century, it has become six separate branches 1. Human Resource management 2. Operations / Production management 3. Strategic management 4. Marketing management 5. Financial management 6. Information Technology management for MIS Overview of management - MANGEMENT PROCESS 4
  • 5. Overview of management - Definition of Management • Management Function Basic Functions What it is Forecasting What is the need of the market, when, how …… Planning Deciding what needs to happen in the future. Generate plans for action. Organising (Implementation)pattern of relationships among workers, making optimum use of the resources required to enable the successful carrying out of plans. Staffing Job analysis, recruitment and hiring for appropriate jobs. Leading / directing Determining what must be done in a situation and getting people to do it. Controlling / Checking progress against plans. monitoring: Motivation: Motivation is also a kind of basic function of management, because without motivation, employees cannot work effectively. If motivation does not take place in an organisation, then employees may not contribute to the other functions (which are usually set by top-level management). Overview of management - MANGEMENT PROCESS 5
  • 6. Overview of management - Definition of Management • Attainment of Organisational Goals – Define goals and plans and explain the relationship – Explain the concept of organisation mission – How the mission influences the goal setting and planning – Define the characteristics of effective goals – GOAL: a desired future state that the organisation attempts to realise. – PLAN: a blue print specifying the resource allocation, schedules and other actions necessary for attaining goals. Mission • concerns what an organization is all about. • answers the questions such as: – who we are, – who are our customers, – what do we do and – how do we do it. Overview of management - MANGEMENT PROCESS 6
  • 7. Overview of management - Definition of Management • Attainment of Organisational Goals Mission Statement Strategic Goals / Plans Senior Management Organisation as a whole Tactical Goals / Plans Middle Management Major Divisions, Functions External Message Legitimacy for: Investors Suppliers Customers Community Internal Message Legitimacy, Motivation Guides Rationale Standards Operational Goals / Plans Lower Management Departments, individuals Overview of management - MANGEMENT PROCESS 7
  • 8. Overview of management - Definition of Management • • Attainment of Organisational Goals Purposes of goals & plans – Legitimacy: • An organisation mission describes what the organisation stands for and its reason for existence. • It symbolises legitimacy to external audience such as investors, suppliers and customers – Source of motivation and commitment • Goals and plans facilitates employees’ identification with the organisation and help motivate them by reducing uncertainty and clarifying what they should accomplish. – Goals provides the “why” of an organisation existence – Plan tells “how” – Guides to action • Goals and plans provide a sense of direction. They focus attention on specific targets and direct employee efforts toward important outcome. Overview of management - MANGEMENT PROCESS 8
  • 9. Overview of management - Definition of Management • • Attainment of Organisational Goals Purposes of goals & plans – Rationale for decisions • Through goal setting and planning, managers learn what the organisation is trying to accomplish. – Standard of performance • Because goals define desired outcomes for the organisation, they also serve as performance criteria. Overview of management - MANGEMENT PROCESS 9
  • 10. Overview of management - Definition of Management Mission Manufacture both standard and custom metal products for various applications in the machine tool industry Strategic Goals     President 12% Return On Investment 5% Growth No employee layoff Excellent service to the customer Tactical Goals     Finance VP Keep outstanding accounts below Rs 5 Lacs Keep borrowing below Rs 40 Lacs Provide monthly budget statements for departments. Have delinquent accounts of no more than 2% of total Production VP  Manufacture 10 lac products at an average cost of Rs 20  Increase manufacturing productivity by 2%  Resolve employee grievances within 3 working days Operational Goals     Accounts Manager Issue invoices within 5 days of sale Check new customers’ credit within 1 working day Allow no account to be overdue more than 5 months Call delinquent accounts weekly Overview of management - MANGEMENT PROCESS Production Manager  Produce 1.5 lac standard units at average cost of Rs 17  Have machine downtime of less than 7%  Respond to employee grievances within 24 hours 10
  • 11. Overview of management - Definition of Management • Basic roles – Interpersonal: roles that involve coordination and interaction with employees – Informational: roles that involve handling, sharing, and analysing information – Decisional: roles that require decision-making Mintzberg's Management Roles The ten roles are: 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. Figurehead. Leader. Liaison. Monitor. Disseminator. Spokesperson. Entrepreneur. Disturbance Handler. Resource Allocator. Negotiator. Overview of management - MANGEMENT PROCESS Category Interpersonal Informational Decisional Role Figurehead Leader Liaison Monitor Disseminator Spokesperson Entrepreneur Disturbance Handler Resource Allocator Negotiator 11
  • 12. Overview of management - Definition of Management Mintzberg’s Managerial Roles Category Role Activity Examples Perform social and legal duties, act as symbolic leader Greet visitors, sign legal documents, attend ribbon cutting ceremonies, host receptions, etc. Leader Direct and motivate subordinates, select and train employees Includes almost all interactions with subordinates Liaison Interpersonal Figurehead Establish and maintain Business correspondence, contacts within and outside participation in meetings with the organisation representatives of other divisions or organisations. Overview of management - MANGEMENT PROCESS 12
  • 13. Overview of management - Definition of Management Mintzberg’s Managerial Roles Category Role Activity Examples Seek and acquire work- Scan/read trade press, periodicals, related information reports; attend seminars and training; maintain personal contacts Disseminator Informational Monitor Send memos and reports; inform Communicate/ disseminate information staffers and subordinates of decisions to others within the organisation Spokesperson Communicate/transmit Pass on memos, reports and information to outsiders informational materials; participate in conferences/meetings and report progress Overview of management - MANGEMENT PROCESS 13
  • 14. Overview of management - Definition of Management Mintzberg’s Managerial Roles Category Role Activity Examples Identify new ideas and Implement innovations; Plan for the initiate improvement future projects Disturbance Handler Deals with disputes or Settle conflicts between subordinates; problems and takes Choose strategic alternatives; corrective action Overcome crisis situations Resource Allocator Decide where to apply Draft and approve of plans, schedules, resources budgets; Set priorities Negotiator Decisional Entrepreneur Defends business interests Overview of management - MANGEMENT PROCESS Participates in and directs negotiations within team, department, and organisation 14
  • 15. Overview of management - Definition of Management In the real world, these roles overlap and • a manager must learn to balance them in order to manage effectively. • While a manager’s work can be analysed by these individual roles, • in practice they are intermixed and interdependent. • According to Mintzberg: • “The manager who only communicates or only conceives never gets anything done, while the manager who only ‘does’ ends up doing it all alone.” Levels of management • Most organisations have three management levels first-level, middle-level, and top-level managers. • These managers are classified in a hierarchy of authority, and perform different tasks. • In many organisations, the number of managers in every level resembles a pyramid. Overview of management - MANGEMENT PROCESS 15
  • 16. Overview of management - Definition of Management Top-level managers • The top consists of the board of directors (including non-executive directors and executive directors), president, vice-president, CEOs and other members of the C-level executives. • They are responsible for controlling and overseeing the entire organisation. • They set a tone at the top and develop strategic plans, company policies, and make decisions on the direction of the business. • In addition, top-level managers play a significant role in the mobilisation of outside resources and are accountable to the shareholders and general public. • The board of directors is typically primarily composed of non-executives which owe a fiduciary (trust, confidential, responsible) duty to shareholders and are not closely involved in the day-to-day activities of the organisation, although this varies depending on the type (e.g., public versus private), size and culture of the organisation. • These directors are theoretically liable for breaches of that duty and typically insured under directors and officers liability insurance. • Fortune 500 directors are estimated to spend 4.4 hours per week on board duties, and median compensation was Rs 1.2 crore in 2010. Overview of management - MANGEMENT PROCESS 16
  • 17. Overview of management - Definition of Management Top-level managers • The board sets corporate strategy, makes major decisions such as major acquisitions, and hires, evaluates, and fires the top-level manager (Chief Executive Officer or CEO) and the CEO typically hires other positions. • However, board involvement in the hiring of other positions such as the Chief Financial Officer (CFO) has increased. • In 2013, a survey of over 160 CEOs and directors of public and private companies found that the top weaknesses of CEOs were "mentoring skills" and "board engagement", and 10% of companies never evaluated the CEO. • The board may also have certain employees (e.g., internal auditors) report to them or directly hire independent contractors; for example, the board (through the audit committee) typically selects the auditor. • In addition, the CEO is responsible for executing and determining (within the board's framework) the broad policies of the organisation. • Executive management accomplishes the day-to-day details, including: instructions for preparation of department budgets, procedures, schedules; appointment of middle level executives such as department managers; coordination of departments; media and governmental relations; and shareholder communication. Overview of management - MANGEMENT PROCESS 17
  • 18. Overview of management - Definition of Management Middle-level managers • Consist of general managers, branch managers and department managers. • They are accountable to the top management for their department's function. • They devote more time to organisational and directional functions. • Their roles can be emphasised as – executing organisational plans in conformance with the company's policies and the objectives of the top management, – they define and discuss information and policies from top management to lower management, and – most importantly they inspire and provide guidance to lower level managers towards better performance. Their functions include: – Design and implement effective group and inter-group work and information systems. – Define and monitor group-level performance indicators. – Diagnose and resolve problems within and among work groups. – Design and implement reward systems that support cooperative behaviour. Overview of management - MANGEMENT PROCESS 18
  • 19. Overview of management - Definition of Management First-level managers • Consist of supervisors, section leads, foremen, etc. • They focus on controlling and directing. • They usually have the responsibility of – assigning employees tasks, – guiding and supervising employees on day-to-day activities, – ensuring quality and quantity production, – making recommendations, suggestions, and up channeling employee problems, etc. • First-level managers are role models for employees that provide: – Basic supervision – Motivation – Career planning – Performance feedback Overview of management - MANGEMENT PROCESS 19
  • 20. Overview of management - Management skills and organisational hierarchy: Management skills and organisational hierarchy: • A manager’s job is varied and complex. • Hence, managers need certain skills to perform the functions associated with their jobs. • During the early 1970s, Robert K. Kalz identified three kinds of skills for administrators. • These are technical, human and conceptual skills. • A fourth skill – the ability to design solutions – was later added to the above mentioned skills. Technical Skills • Technical skills refer to the ability of a person to carry out a specific activity. • In order to do so, one needs to have knowledge of methods, processes and procedures. • Engineers, computer specialists, accountants and employees in manufacturing departments all have the necessary technical skills for their specialized fields. • Technical skills are essential for first-level managers. • For example, employees at the operational level work with tools, and their supervisors must be able to teach them how to perform the tasks assigned to them using these tools. • First-level managers spend much of their time in training subordinates and clarifying doubts in work-related problems. Overview of management - MANGEMENT PROCESS 20
  • 21. Overview of management - Management skills and organisational hierarchy: Human Skills • Human skills or interpersonal skills refer to the ability of a person to work well with other people in a group. • It is the ability to lead, motivate, and communicate with people to accomplish certain objectives. • Human skills are of paramount importance in the creation of an environment, in which people feel comfortable and are free to voice their opinions. • These skills aid employees during interaction with their supervisors, peers and people outside the work unit such as suppliers, customers and the general public. • These skills are important for all levels in the organization. Conceptual Skills • Conceptual skills refer to the ability of a person to think and conceptualise abstract situations. • It is the ability to understand and coordinate the full range of corporate objectives and activities. • These skills are most important at the top management level, as top-level managers have the greatest need to see the “big picture,” to understand how the various parts of the organization relate to one another and associate the organization with the external environment. Overview of management - MANGEMENT PROCESS 21
  • 22. Overview of management - Management skills and organisational hierarchy: Design Skills • Design skills refer to the ability of a person to find solutions to problems in ways that would benefit the organisation. • Top managers should not only recognize a problem but also suggest ways to overcome them. • If they only see the problem, they become mere “problem watchers,” and will prove ineffective. • Managers at upper organisational levels should be able to design a rational and feasible solution to the problem by considering the various internal and external factors. Overview of management - MANGEMENT PROCESS 22
  • 23. Overview of management - Management skills and organisational hierarchy: Relative Need for the Main Categories of Skills • First-level managers require more technical skills in order to supervise operational employees. • They need to have good human skills for they need to interact with their subordinates on a regular basis. • However, conceptual skills are usually not very essential for the managers at the supervisory level. • The need for technical skills is lesser at the middle-management level. Here, human skills and conceptual skills are more significant. • At the top-management level, conceptual, design and interpersonal skills are of greatest importance; there is little need for technical skills. Overview of management - MANGEMENT PROCESS 23
  • 24. Overview of management - Management skills and organisational hierarchy: Management skills and organisational hierarchy: • Technical skills; • Human skills; • Conceptual and design skills; • Their relative combinations at various managerial levels. Technical skills expertise in one's particular functional area. Interpersonal used to communicate, motivate, mentor and delegate Conceptual used to analyse complex situations. Diagnostic ability to visualise most appropriate response to a situation Political used to build a power base and establish connections Overview of management - MANGEMENT PROCESS 24
  • 25. Overview of management - Approaches to management Approaches to management: • Since based on cases and past experiences, it has not contributed anything fundamental to the development of management as a discipline because of contradictions in various management experiences. • The proposition that a successful technique applied in the past will be good for future is untenable. • 1) Management is not based on precedents • 2) Situations can not be exactly identical. Approach Empirical/ case approach What it is Study of managerial experiences and cases Overview of management - MANGEMENT PROCESS Features –Study of Managerial Experiences –Managerial experience passed from industry to students for continuity in knowledge management. –Study of Successful & failure cases help practicising managers. –Theoretical research combined with practical experiences. Uses Learning through experience of others Limitations No Contribution for the development of management as a discipline Situations of past not the same as present. 25
  • 26. Overview of management - Approaches to management Approaches to management: Approach What it is Organisation as people a) Interpersonal Behaviour Interpersonal Approach behaviour Individual approach Psychology b) Group Behaviour ApproachOrganisation Overview of management - MANGEMENT PROCESS Features Uses –Draws heavily from psychology & sociology. Demonstrates how –Understand human management can relations. be effective by –Emphasis on greater applying knowledge productivity through motivation & good human of organisation behaviour. relations –Motivation, leadership, participative management & group dynamics are core of this approach. Limitations Treating management as equivalent to human behaviour. Talks about organisation & organisation behaviourin vague terms. 26
  • 27. Overview of management - Approaches to management Approaches to management: Approach What it is Features Uses Social System, a system of cultural relationship Relationship exist between external and internal Organisational environment of the decisions should organisation. Cooperative Understanding the Formal Organisationnot be based on social behaviourof desires of one Cultural relationships of systems groups & group alone but social groups approach individuals. should reflect the working within the interests of all the organisation. Co-operation necessary parties. Efforts directed -harmony between goals of organisation & goals of groups. Overview of management - MANGEMENT PROCESS Limitations Broader than management & its practice Overlooks many management concepts principles & techniques that are important to practising managers. 27
  • 28. Overview of management - Approaches to management Approaches to management: Approach Socio technical system approach What it is Features Uses Organisational effectiveness Social & technical systems depends on looking interact. This interaction is at people and their important for interactions and The socioorganisational also at the technical systems effectiveness. technical approach of environment in management which they operate. views an organization as a combination of 2 –Organisation–governed Change in systems – a social by social laws as well as technology psychological forces. system and a technical system. –Technical aspects of organisation modified by the social aspects. Overview of management - MANGEMENT PROCESS Limitations Lack of total managerial view Concentrate on factory or other production system No new contribution People aware about Change in social the role of interactions at work technology of the place social system of the work place 28
  • 29. Overview of management - Approaches to management Approaches to management: Approach W hat it is Features it is the most recent development in the field of management.This attempts to integrate all the management approaches. In developing management concepts the Appropriateness of a environment within management technique which the depends on situation. concepts are to be applied has to be considered. Contingency / Internal situational environment approach Structure, Processess, Technology. If -Then approach. External Environment Social, Economic, Political etc. Overview of management - MANGEMENT PROCESS 29
  • 30. Overview of management - Approaches to management Approaches to management: Approach What it is Management is a process. Universalist/ Classist/ Traditional Approach. Features Functions of managers remain same Functions of management Uses Limitations core of good management Operational Flexible & practical but not universal. This concentrates Framework of approach. on the role and management functions of managers and Principles of management distills the principles to be followed by them. Overview of management - MANGEMENT PROCESS 30
  • 31. Overview of management - Approaches to management Approaches to management: Approach What it is Features Uses Problem Solving mechanism with the help of mathematical tools and Managementtechniques. logical entity Problems Expressed in Provided mathematical symbols. Mathematical Variables in management Exactness in approach management –quantified. Scope -Decision making, discipline. •Actionssystem analysis & some Mathematical aspect of human symbols, behaviour. Relationships and Tools -Operations measurable data. research, simulation etc. Overview of management - MANGEMENT PROCESS Limitations Not a separate school Technique in decision making. 31
  • 32. Overview of management - Approaches to management Approaches to management: Approach What it is Features Uses Management is decision making. Manager Members of Organisation –Decision maker decision makers and Managerial problem solvers. roles Decision making -control Tools for making approach or suitable decisions •Organisation–Dec point in management Decision ision making unit. Increasing efficiency -the in organisations. Theory quality of decision approach MIS, process & techniques of decision making are the subject matter of study. Overview of management - MANGEMENT PROCESS Limitations Does not take the total view of management Decision making one aspect of management 32
  • 33. Overview of management - Approaches to management Approaches to management: • McKinsey’s 7S framework • It is a management model developed by well-known business consultants Robert H. Waterman, Jr. and Tom Peters in the 1980s. This was a strategic vision for groups, to include businesses, business units, and teams. • The 7S are – structure, – strategy, – systems, – skills, – style, – staff and – shared values. • The model is most often used as a tool to assess and monitor changes in the internal situation of an organization. • The model is based on the theory that, – for an organization to perform well, – these seven elements need to be aligned and mutually reinforcing. Overview of management - MANGEMENT PROCESS 33
  • 34. Overview of management - Approaches to management • McKinsey’s 7S framework Strategy Way to achieve competitive advantage Structure Ways in which task and people are specialised and divided and authority is distributed. Systems Formal processes and proceedures to manage the organisation Staffing People, their background and competencies Skills Style Shared Values Distinctive competencies in the organisation Leadership style of top mangement and overall operating style of organisation Core values shared in the organisation and serve as guiding principles of what is important Overview of management - MANGEMENT PROCESS Low-cost strategy through economic production or delivery Product differentiation through distinct features or innovative sales Four main structures Functional Structure Divisional Structure Matrix Structure Network Structure Performance Measurements Reward Systems Planning Budgeting Resource Allocation Information System Distribution Organisation's approach to recuitment, selection, socialisation, training and employee development Can be of people, Management Practices, systems and / or technologies. Impacts norms followed by people, how they work and interact with each other and customers. Helps focus attention and provides a broader sense of purpose. 34
  • 35. Overview of management - Approaches to management • McKinsey’s 7S framework – So, the model can be used to help identify what needs to be realigned to improve performance, or – to maintain alignment (and performance) during other types of change. • Whatever the type of change – – restructuring, – new processes, – organizational merger, – new systems, – change of leadership, and so on • the model can be used to understand how the organizational elements are interrelated, and so ensure that the wider impact of changes made in one area is taken into consideration. Using the 7-S model Each S is consistent with and reinforces the other S's Recognise the full range of elements that need to be changed and focus on the ones that will have the greatest effects. All seven variables are interconnected- it is decided by diagnosis of the alignment of the organisation. Overview of management - MANGEMENT PROCESS 35
  • 36. Overview of management - Approaches to management • McKinsey’s 7S framework • Objective of the model: – To analyse how well an organization is positioned to achieve its intended objective • Usage: – Improve the performance of a company – Examine the likely effects of future changes within a company – Align departments and processes during a merger or acquisition – Determine how best to implement a proposed strategy • The Seven Interdependent Elements – The basic premise of the model is that there are seven internal aspects of an organization that need to be aligned if it is to be successful • Hard Elements: (Easier to change) Strategy, Structure, Systems • Soft Elements: (Harder to change directly and take longer) Shared Values, Skills, Style, Staff Overview of management - MANGEMENT PROCESS 36