This document provides an introduction and definitions of management. It discusses management as a universal activity that is goal-oriented, an intellectual process, and ongoing. The document outlines the functions of management including planning, organizing, staffing, directing, controlling and coordinating. It distinguishes between administration and management and discusses management as both an art and a science. The document describes the importance of management to organizations and the economy. Finally, it discusses the nature, need and importance of principles of management.

1. PRINCIPLES OF
MANAGEMENT
UNIT - I
R.RAJARAJESHWARI
ASSISTANT PROFESSOR
DEPARTMENT OF COMMERCE(HONS.)
ETHIRAJ COLLEGE FOR WOMEN

2. INTRODUCTION & DEFINITION
It is common knowledge that a single individual cannot do all work by himself. The work is always
shared with others. Management is basically concerned with the performance of planning, organizing,
directing, co-ordinating and controlling the activities.
 “Management is the art of getting things done through people” – Mary Parker Follet.
 “To manage is to forecast and plan, to organize, to command, to co-ordinate, and to control – Henry Fayol.
 “Management is the art of knowing exactly what you want your men to do and then seeing that they do it in the
best and the cheapest way” – F.W.Taylor
 “Management is the creation and maintenance of an internal environment in an enterprise where individuals,
working in groups, can perform efficiently and effectively towards attainment of group goals. It is the art of getting
the work done through and with people in formally organized groups” – Koontz and O’Donnel.

3. UNIVERSAL ACTIVITY
• It has relevance not only in business but also in household work, in army, in
government activities and so on
GOAL ORIENTED
• Focuses attention on the attainment of specific objectives
INTELLECTUAL ACTIVITY
• Requires application of mind and intelligence, every work needs to be properly
planned and executed.
PROCESS
• Consists of various stages/functions. Each of these functions will have to be done in
the sequential order.
INTEGRATED APPROACH
• The goal of an individual employee and that of his organisation much be integrated.
Multidisciplinary
• Engineering, sociology, psychology, economics, anthropology, etc..

4. ONGOING ACTIVITY
• It is a continuous activity, will exist as long as there are human activities
SOCIAL PROCESS
• Deals with behaviour of individuals and groups, works as a team.
INTANGIBLE
• Management is invisible and cannot be seen, but it can be felt.
PROFESSION
• Provides consultancy services to businessmen upon his area of specialisation.
FACTOR OF PRODUCTION
• Considered as a prominent factor to combine and coordinate all other available
resources.
Art as well as Science
• Theoretical knowledge involving practical application

5. DISTINCTION BETWEEN ADMINISTRATION
AND MANAGEMENT
ADMINISTRATION
 Determinative function – all Policy decision are made.
 Administrators are owners of the concern
 Top-level function
 Concentrates on results like Profitability, Future
prospects, etc
 Do not take part in daily activities
 Decisions are influenced by external factors like govt.
regulations, capital available…
 Permanent Body – no major changes takes place
 Concerned with planning and controlling function
 Requires conceptual and human skills
MANAGEMENT
 Executive function – implementation of the policies.
 Managers are paid employees of the concern
 Middle or Lower level function
 Concentrates on the attainment of gaols set by the
administration.
 Responsible for daily activities
 Decisions are influenced by opinions, values and beliefs,
past happenings
 Non-static body – many change, resign or removed.
 Concerned with Directing and controlling function
 Requires technical and human skills.

6. MANAGEMENT AS AN
ART
Applies principles,
techniques and
knowledge to address
the issues arising
Practical application
Manager applies his
own approach towards
problems depending
on his perception
Personal skills
Thinks innovatively &
foresightedly to tackle
peculiar challenges
Creative use
The success of a
manager is measured
by his success leading
to realisation of goals
Result-oriented
Applies knowledge
regularly in positive
and negative situations
Regular practice
Acts on best judgement
with past experience &
perception in many
contexts
Individual judgement

7. MANAGEMENT AS A
SCIENE
well defined
concepts, principles
and techniques
Systematic body
Based on observation,
experiments and
research
Scientific method
Organised knowledge
can be codified and
transferred
Knowledge tansferebility
Establishes
relationship among
various factors
Cause & effect
relationship
Validity is tested and
realizable based on
predictions
Validity of principles

8. MANAGEMENT AS A
PROFESSION
Concepts and Principles
interdependent with
other disciplines
Body of knowledge
Prescribed code of
conduct to be followed by
managers
Ethical code
Imparted by
management
institutions and
universities
Formal training
Renders social obligation
to employees and
society
Service motive
Recognized apex
body to promote the
interest & values
Representativebody
Observes norms and
observe self control
Self Discipline

9. IMPORTANCE OF MANAGEMENT TO THE
ORGANISATION
 GOAL ACCOMPLISHMENT : All establishments are goal driven. Managers drive the organization
towards goals.
 REOURCES MOBILIZATION : Enables the organisation to assemble men, money, material and
technology grouping them on a logical basis, determining a structure to execute work.
 SYSTEMATIC APPROACH: Meticulous planning avoids chaos in the organization to frame policies,
procedures, rules, budgets and schedules.
 DIVISION OF WORK : The process of departmentation is followed to divide work among various
specialisation facilities.
 ENGAGEMENT OF RIGHT PERSON : Staffing enables an organization to identify and persuade the
potential candidates to apply , thus filter out the right personnel for the right job.
 HUMAN RESOURCES DEVELOPMENT : Employees are exposed to the latest development in their
respective fields and skill competence.
 MOTIVATION OF EMPLOYEES : The morale and motivation of employees are kept high by providing
various monetary and non-monetary incentives.

10. IMPORTANCE OF MANAGEMENT TO THE
ORGANISATION
 COMMUNICATION : The flow of communication goes horizontally, vertically and
diagonally so as to elicit right action to accomplish the goals of the organization.
 LEADERSHIP : Managers across the levels influence the subordinates through
active leadership qualities to accomplish the targets.
 CONTROL FUNCTION ; Verifies whether all actions and operations aimed at goals
are proceeding as per the planned schedule. If there is any shortfall in the
performance, corrective action are taken.
 INTEGRATION OF DIVERSE FUNCTION : Mobilises the divergent functional
performance and systematically directs it towards the overall goals of the
organisation.

11. IMPORTANCE OF MANAGEMENT TO THE
ECONOMY
 EFFICIENT UTILIZATION OF RESOURCES : Resources available in the economy are
effectively and efficiently harnessed by the application of management concepts.
 WEALTH CREATION : Managers create tangible wealth for the nation in the form of
goals, services and other resources.
 HEALTHY COMPETITION : Application of management concepts aid in
professionalizing the operations of business enterprise and it promotes healthy
competition among them thereby benefitting the final consumers.
 STANDARD OF LIVING : Facilitates saving in material and labour cost. This make
product cost effective which ultimately improves the standard of living of the
people.

12. WORKFORCE LEVEL
OPERATING LEVEL
MIDDLE LEVEL
INTERMEDIATE
LEVEL
TOP LEVEL CEO/BOD
MARKETING
MANAGER
BRANCH HEAD
SALES OFFICERS
SALESMEN
PRODUCTION
MANAGER
PLANT
SUPERINTENDENT
FOREMAN /
SUPERVISORS
WORKERS
FINANCE
MANAGER
CHIEF
ACCOUNTANT
ACCOUNTS /
FINANCE OFFICERS
CLERKS

13. • Corporate plan
• Objectives
• Design organisation structure
• Formulating strategies
• Coordinating various departments
• Decisions on mergers, acquisitions, expansion,
modernization, etc
• Appointment of Heads of functional
departments
• Investment decisions
• Distribution of profit TOP LEVEL
• Command of the entire department
• Accountable for the performance
• Coordinates and controls different segments
• Gives detailed instructions regarding job
performance to middle level management
INTERMEDIATE LEVEL
• Interpreting plans, polices and regulations
devised by top management
• Monitoring and controlling
• Training the operating manager
• Prescribing rules and regulations to be
followed by operating managers
• To motivate supervisory personeel
MIDDLE LEVEL
• Getting the work executed by the operatives
• Scheduling the work
• Giving detailed instructions and assigning work to the
workers on daily basis
• Ensuring adherence to quality standards
• Transmitting workers grievances to upper level management
• Maintaining team spirit among the workers
OPERATING/LOWER LEVEL

14. FUNCTIONS/PROCESS OF MANAGEMENT
- NATURE
• The entire management process is regarded as a social process as the success of all
organizational efforts depends upon the willing co-operation of people. Managers
guide, direct, influence and control the actions of others to achieve stated goals.
SOCIAL PROCESS
• Management functions are universal in the sense that a manager has to perform them
irrespective of the size and nature of the organization. Each manager performs the
same functions regardless of his rank or position in the organization.
UNIVERSAL
• The process of management is on-going and continuous. Managers continuously take
up one or the other function. Management cycle is repeated over and over again
CONTINUOUS
• Managerial functions are contained within each other the performance of the next
function does not start only when the earlier function is finished. Various functions are
taken together. So all functions can be thought of as sub-functions of each other.
ITERATIVE
• There cannot be any sequence which can be strictly followed for performing various
functions. Any function may be taken up first or many functions may be taken up at
the same time.
COMPOSITE

15. PLANNING
 Planning is the first and foremost function of the management. All other functions are
based on planning. Manager has to determine in advance what is to be done, when it is
to be done and how it is to be done. It is a process of determining objectives,
discovering alternative courses of action and selecting an appropriate course of action
for accomplishing goals. It is an ongoing process, a pervasive function done at all
levels of management.
Planning involves the following activities :
 Determination of objectives for the organisation
 Formulation of policies, budgets, programmes and schedules.
 Formulation of plans of action both strategic and operationsl
 Forecasting
 Decision making

16. ORGANIZING
 The term organizing refers to assembling men, money, material and technology
together. It is a process of establishing harmonious relationship among the members
of an organisation and the creation of network of relationship among them.
Organizing involves the following activities:
 Determining the total activities of business essential to accomplish organizational
objectives.
 Diving and sub dividing the activities into identifiable groups
 Grouping of activities of similar nature in terms of departments/sections/units.
 Delegation of authority to respective departments
 Co-ordinating the functions of different departments for accomplishing the overall
goals.

17. STAFFING
 Once the plans and the structure of the organisation has been designed, managers seek to fill up the
slots with suitable manpower. Work will be assigned to employees who are given authority to carry out
the work and made accountable for it.
 Staffing involves the following activities :
 Determination of manpower requirements
 Arranging to identify eligible candidates and persuading them to apply for vacancies.
 Selecting suitable candidates
 Formulating HR policies for governing manpower
 Periodical training and evaluation of a manpower and their development
 Compensating with incentives, transfer, promotions or disciplinary actions
 Installing grievance redressal mechanism
 Maintaining overall wellbeing of the employees and career development

18. DIRECTING
 Directing denotes motivating, leading, guiding and communicating with subordinates on an
ongoing basis in order to accomplish pre-set goals. Employees are kept informed of all necessary
matter by circulars, instructions, manuals, meetings, participative mechanism etc
 The process of directing involves the following :
 Issuing orders and instructions regarding the work to be performed.
 Guiding, counselling, mentoring and educating the employees
 Supervising the work of employees on a regular basis.
 Maintaining discipline among employees and rewarding those who perform their jobs efficiently.
 Motivating the employees and inspiring subordinates to follow the orders and instructions.
 Providing effective leadership to employees.

19. CONTROLLING
 The process of controlling is the final function carried out. It is performed to evaluate the
performance of employees and deciding increments and promotion decisions. It is the control
function which facilitates synchronisation of actual performance with predetermined standards.
 Controlling function involves the following :
 Fixing performance standards for subordinates
 Measuring the actual performance in the light of standards
 Comparing the actual performance with standards
 Finding out the causes for deviation and anlayzing them
 Undertaking corrective measures in order to bring actual performance to the standards set.
 Various devices like accounting, auditing, management information system, cost control and
financial tools are also used for control purpose.

20. CO-ORDINATION
 Coordination is the process of synchronising the diverse functions of domains and
securing unity of action. It is a conscious and rational process of pulling together
various department of an organization and unifying them into a team to accomplish
the goals in an effective manner.
 The process of coordination involves the following :
 It is the basis responsibility of management
 The purpose is to secure uniformity of action
 It is an ongoing process
 It is imperative in group effort.
 It is secured through committees, communications, co-operation, goal setting, liason
officer, harmonized policies and authority structure.

21. PRINCIPLES OF MANAGEMENT - NATURE
Universal Applicability: The principles of management are also universal in nature. All business (industrial
etc.) and non-business organisations (educational institutions, government
playgrounds, agricultural farms, army, clubs and other social organisations), in
achieve their objectives have to apply more or less the same principles
General Guidelines: The principles of management are not definite. They are of the nature of general
guidelines, and they cannot be applied strictly.
Formed by Practice and
Experimentation:
Principles of management are the results of various problems faced by the professional
people. First of all problems appeared and then through careful research work solutions
were found.
Flexibility: As and when political, economic and social changes take place, new kinds of problems
arise. Therefore, the principles of management are dynamic in nature and cannot be
called stagnant or fixed.

22. PRINCIPLES OF MANAGEMENT - NATURE
Mainly Behavioural directly concerned with human behaviour. The
management activity is mainly concerned with
management of man, who is a social animal having his
own nature, desires and expectations which cannot be
repressed or eliminated.
Contingent: The principles of management are not fixed or permanent.
They are affected by situations or circumstances.
Therefore, the decision to implement them or not is taken
according to the situations or circumstances.
Relationship between Cause and Effect: They specify what the ultimate outcome will be if in a
particular situation, work is done in a particular manner.

23. PRINCIPLES OF MANAGEMENT –
NEED/IMPORTANCE
(1) Providing managers with useful insight into reality:
 Management principles act as guidelines for the managers. These principles improve knowledge, ability and
understanding of managers under various managerial situations.
(2) Optimum utilisation of resources:
 The management principles insist on planned activities and systematic organisation of men and materials in the
organisation. Principles are designed to get maximum benefits from the human efforts and other resources.
(3) Scientific decisions:
 Managers have to take number of decisions every day. So they need to assess the resources of organisations very carefully
so that the appropriate decision can be taken by using the available resources in best possible manner. The management
principles enable the managers to approach various problems systematically and scientifically.
(4) Meeting changing environment requirement:
 Every businessman has to make changes in the organisation according to changes taking place in the business
environment. Management principles train the managers in implementing the changes in right direction and at right level
in the organisation.

24. PRINCIPLES OF MANAGEMENT –
NEED/IMPORTANCE
(5) Effective administration:
 Administration is the function of top level management. In this function major plans and policies are formed. The
management principles act as guidelines and base to form various administrative policies to have systematic
working in the organisation. Management principles make administration more effective by discouraging personal
prejudices and biases.
(6) Fulfilling Social responsibilities:
 A business is creation of society and makes use of resources of society so it must do something for society also by
performing some social responsibilities. Management principles not only act as guidelines for achieving
organisational objectives but these principles also guide the managers to perform social responsibilities.
(7) Management Training, Education and Research
 The management principles stress on scientific judgements and logical thinking. As a result these principles act as
base of doing research and development in management studies. As these principles provide organised body of
knowledge to perform research work and generate more and more knowledge, they have provided new ideas,
imagination and base for research and development.

25. • Total work to be divided into small parts, each entrusted to a particular individual. As individual
performs only a particular activity, he becomes a specialist in due course.
DIVISION OF
WORK
• Authority is the official right of a manager. Responsibility is the obligation on the part of a
subordinate to account for the work done by him. Authority can be delegated. Responsibility
remains intact with each person. Responsibility without authority will be ineffective. On the
other hand authority without responsibility may lead to misuse of authority
AUTHORITY &
REPONSIBILITY
• Employees should adhere to the agreement reached with the employer by being obedient and
engaging in the task assigned fully. Discipline can be enforced by leaders who practice it.
DISCIPLINE
• An employee should receive orders from one superior only and is accountable to him alone.
Dual command is a perpetual source of conflict. It will undermine authority, endanger discipline.
UNITY OF
COMMAND
PRINCIPLES OF MANAGEMENT – HENRY FAYOL

26. • Each group of activity having the same objective should have one head and one plan. The
efforts of all the members of a department must be directed towards the attainment of that
departmental target.
UNITY OF DIRECTION
• The interest of the organisation if often ignored in favour of individual interest. When there is
such a conflict, the organisational interest must be made to prevail by constant supervision, fair
agreement, firmness and supervisors as role models
SUBORDINATION OF
INDIVIDUAL INTEREST TO
GROUP INTEREST
• Remuneration payable to the employees must be fair and should give maximum satisfaction to
both employees and the employers. Factors such as cost of living, availability of personnel, the
financial position of the business will influence remuneration.
REMUNERATION OF
PERSONNEL
• Concentration of authority at a particular place is centralisation and dispersal of authority in
different place is Decentralisation. Degree of centralisation will vary from organisation to
organisation. Small concerns generally prefer Centralised setup as the orders if the superiors
can be directly conveyed to the subordinates.
CENTRALISATION
• It is the chain of superiors ranging from the highest to the lowest level in the organisation.
Every communication should follow the prescribed line of authority.
SCALAR CHAIN

27. • Material order – A place for everything in its place(necessary to avoid material losses)
• Social order – A place for everyone in his place(Selection of right man for the right job)
ORDER
• Ensures fairness, kindness and justice in the treatment of employees by their managers. The
managers shall be impartial in their dealings with their subordinates. It promotes cordial
relationship between workers and management
EQUITY
• Employee shall not be unnecessarily shifted from one job to another. He should be given
enough opportunity to learn every aspect of his work. Only then he will become an expert in his
line of work.
STABILITY OF TENURE
OF PERSONNEL
• An employee who has the freedom to think and act in an organisation will show greater
interest in his work and will lead to a higher level of job satisfaction.
INITIATIVE
• Team work and co-operation among the members of an organisation are essential for its
success. Informal relationships among the employees should be encouraged. The employees
should also have the conviction that the management is really interested in their welfare.
ESPIRIT DE CORPS

28. SKILLS OF
A
MANAGER
TECHNICAL SKILL
HUMAN
RELATIONS SKILL
CONCEPTUAL
SKILL
ANALYTICAL
SKILL
ADMINISTRATIVE
SKILL
ROLE OF A
MANAGER
INTER
PERSONAL
ROLE
INFORMATIONAL
ROLE
DECISIONAL
ROLE

29. MANAGERIAL SKILLS - EXPLAINED
TECHNICAL
 Ability to grasp things in quick time
 Proficiency in using various
methods, procedures and
techniques
 Knowledge of sequence of
procedures to be followed in a work
 Ability to operate computer and
updated technology
 It can be acquired through formal
education
HUMAN RELATIONS
 Motivating, counselling and
facilitating team building
 Understanding the behaviour of the
employees
 Knowledge of factors influencing
human behaviour at work
 Providing effective leadership
 Building team spirit among the
employees
 Maintaining rapport with employees
CONCEPTUAL
 Ability to develop a holistic view
about the organisation
 knowledge of interdependence of
work
 Analytical and decision making skills
 Scanning the environmental
dynamics and unearthing
opportunities
 Making SWOT analysis
 Determining overall objectives of an
organisation

30. MANAGERIAL SKILLS - EXPLAINED
 ANALYTICAL
 Studying a problem in a systematic way
 Collecting information on various aspects
 Establishing and describing relationship
among the variables
 Breaking a problem into number of
components and getting an insight
 ADMINISTRATIVE
 Ability to coordinate the activities of
various departments
 Seeking effective use of utilization of
allocated resources in the light of ground
reality
 Examining work on practical situations

31. INTERPERSONAL ROLE
FIGURE HEAD  Doing ceremonial duties like
receiving visitors
 Signing documents
 Delivering speeches at social
gatherings
LEADERSHIP ROLE  Motivating subordinates and
directing them towards goal
accomplishment
LIASON ROLE  Integrating organisation internally
and externally
 Integrating individuals with the
organisation vertically and
horizontally
 Integrating the organisation with its
environment to assess the level of
competition, magnitude of social
change, impact of government
policies and legislative enactments.
MANAGERIAL ROLES - EXPLAINED
INFORMATIONAL ROLE
MONITORING  Receiving from several sources to
obtain thorough knowledge about
environment influencing
organisation
DISSEMINATOR  Transmitting information collected
from different sources to other
members of the organisation
SPOKESPERSON  Representing organisation to the
outside world and explaining
goals, policies, programmes and
results of certain actions

32. DECISIONAL ROLE
ENTREPRENEURS  Whenever opportunities manifest, he initiates action for
capitalizing it
 Absorbing changes or bring in changes into the organisation
through environmental scanning
 Conducting viability study, organising strategy meeting with
the project manage and R&D personnel
TROUBLE SHOOTER  Intervening whenever unexpected events unfold like strike,
grievances, cash flow shortage, accident etc.
RESOURCE PERSON  Deciding the priorities of organisational activities and
allocating resources to those activities.
NEGOTIATOR Representing an organisation in negotiating deals within the
organisation and also with external agencies like suppliers,
contractors, banks and the like.