This document discusses concepts related to management including definitions of management provided by various thinkers, the levels and functions of management, managerial skills and roles, and general principles of management. Some key points: - Management involves planning, organizing, staffing, directing, coordinating, and controlling organizational resources to achieve goals. - Top management establishes goals and policies, middle management implements plans, and lower management supervises workers. - Effective managers require technical, human, and conceptual skills as well as strong decision-making abilities. - Managers fulfill interpersonal, informational, and decisional roles such as leadership, monitoring information, and allocating resources. - Fayol outlined 14 general principles

1. Management Behavioral Process
Business:
It can be defined as an institution organized & operated to provide goods & services to
the society under the incentive of private gain.
Business means all those activities connected with the production & exchange of goods
or services & the financial affairs connected with these activities.
There are two components of Business:
1) Industry :
It is concerned with production of goods by adopting a process through utilization of the
available material resources. In other words industry signifies those business activities which
are producing processing & fabrication of products.
Industrial Products:
a) Consumer Goods
b) Capital Goods
c) Intermediate Goods
2) Commerce:
Commerce deals with buying & selling of goods, the exchange of commodities &
distribution of the finished products. Commerce is that business activity which aims at carrying
goods from the place of their production to the place of their demand or consumption.
Definition of management by some of leading management thinkers & practitioners:
F W Taylor

2. Management is the art of “knowing what you want to do & then seeing that it is done in
the best & cheapest way.”
The above definition shows the productivity oriented approach of Taylor. Managers
according to him should secure the maximum use of men, machine, money & materials. His
concern for people was low on account of this he was criticized by many.
Henry Fayol:
“To manage is to forecast & to plan, to organize, to command, to coordinate & to control.”
This definition for the first time, mentioned the functions of management for achieving desired
results. Fayol treated management as a process of planning , organizing, commanding,
coordinating & controlling.
Peter Drucker:
“Management is work & as such it has its own skills, its own tools, its own techniques,
management is the organ, the life giving, acting dynamic organ of the institution it manages.
Management is a discipline.
Management is also people.
Management is Practice.
The above statement of Peter Drucker, point out different facets of management. In the
ultimate analysis he looks upon management as a practice. He is thus concerned with results.
Concept of Management
The word management can be styled as manage-men-tactfully. This is with a view to
getting the things done, through others. Traditionally, management means managing men

3. tactfully to get the things done through others. But modern approach to management is much
broader it involves all kinds of activities which determine the objectives of the organization.
Modern concept of management is goal oriented & it creates an internal environment for
attaining the goals efficiently. The term management is also used as a process, as a group, as a
discipline and as an activity.
I] Management: ( A Process)
Management is considered as a process which includes all functions which transforms
resources such as men, material, money, machines, methods into products & services to satisfy
the consumer needs. These resources as a whole are termed as 5M’s. The activities performed
during the process of transformation of resources are known as management functions. Thus
the management function comprises of functions such as planning, organizing, staffing,
directing, coordinating & controlling.
Features of Management as a process:
1) Continuous Process:
The task of the manager does not finish even after performing the last functions of
management i.e. control. His job again starts with the planning function & so on. So
management is a continuous process.
2) Integrating Process:
All the functions of the management viz, planning, organizing, directing & controlling are
performed for integrating the human & material resources for attaining the goals of the
organization. Therefore the management is an integrating process.
3) Social Process:

4. Management deals with human beings. A manager directs, coordinates & controls the
activities of the human beings in order to achieve the predetermined objectives. So it is also
a social process.
4) Universal Process:
The principles of management are applicable to all types of enterprises whether small or
big units such as MNC. Therefore it is universal process.
5) Interactive Process:
The functions of the management are interwoven i.e. two or more functions may be
performed at a time. For e.g.: While preparing a plan a manger also sets the standards for
control.
II] Management ( A Group ):
Management as a group refers to those who carry the activities of the management. So the
management consists of all those persons who are managing the affairs of the business.
Therefore the term management represents the group of people i.e from chairman to
supervisors, because they are concerned with getting things done through others.
Characteristics:
1) It comprises persons right from chief executives to the supervisor, who have been
assigned managerial duties.
2) It refers to top management only.
3) The word management used as a collective noun.
III] Management: (A Discipline)

5. Management has developed as a full-fledged discipline in due course of time. The knowledge of
management is being developed by number of scholars & it is being formally taught to the
students of management. Thus the management has grown as a separate discipline of study.
Characteristics:
1) It is an organized body of knowledge.
2) It can be learned through teaching and training.
3) Its study produces qualified professionals.
IV] Management (An Activity):
The functional aspect of management is to organize the human & the material resources
to achieve the objectives of the enterprise. In this process the managers have to perform many
activities.
a) Communication:
All managers have to communicate with their superiors as well as subordinates either in
writing or orally.
b) Decision Making:
In an enterprise a manger has to take number of decisions, such as recruitment of
workers, selection of advertising media etc. Actually all the activities of the management
are regulated by decision making process.
c) Human Relations:
Management involves the activities for getting the work done through others. Therefore
the managers maintain good relations with their superiors as well as subordinates.
Process of Management

6. All business enterprises are started to attain some predetermined objectives. In order to
achieve these goals a manager has to undertake a number of activities. A series of activities
necessary to achieve specific goals is called as management process. The study of management
process basically involves the study of managerial functions.
Functions of Management.
1) Planning:

7. Planning is the first & most important function of management. It is determination of
course of action to be followed for achieving the organizational objectives.
In simple words, planning is deciding in advance what to do, how to do it, & who is to do it.
A plan is a future course of action. It can be characterized as the process thinking before doing.
2) Organizing:
Organizing is the process of dividing work into sections & departments. It involves allocation
of authority, responsibility & duties among all the members of the enterprise.
3) Staffing:
Another popular term for staffing is HRM. Staffing concerned with human resource of an
organization. Staffing includes personnel functions of recruitment, selection, placement,
training, promotion & retirement.
Staffing process provides the organization with adequate, competent & qualified personnel
at all levels of enterprise.
4) Directing:
The organization does not start working till the manager gives direction. Direction means
guiding & supervising the subordinates.
It deals directly with influencing guiding, supervising & motivating the subordinates for the
accomplishment of predetermined objectives.
5) Coordination:
Coordination is unifying the actions of a group of people for some common purpose. In simple
words, coordination is to unite all activities of the business. Coordination creates a team spirit
& helps in achieving goal through collective efforts. Coordination can not be achieved without
effective leadership.
6) Controlling:

8. Control is to guide somebody or something in the direction in which it is intended to go. It is a
process of checking actual performance against the agreed standards or plans with a view to
ensuring adequate progress or satisfactory performance.
Objectives or Purpose of Management:
1) Optimum Utilization of Resources:
The most important objective of the management is to use various resources of the enterprise
in most economic way. The proper use of men, machine, material & money will help a business
to earn sufficient profits satisfy various interests i.e. proprietor, customers, employees etc.

9. 2) Growth & Development of Business:
By proper planning, organizing directing & controlling management leads a business to growth
& development on sound footing. It helps in profitable expansion of the business. It provides a
sense of security among the employers & employee.
3) Better Quality Goods:
The aim of sound management has always been to produce the better quality products at
minimum cost. Thus, it tries to remove all types of wastages in the business.
4) Ensuring Regular Supply of Goods:
Another objective of management is to ensure the regular supply of goods to the people it
checks the artificial scarcity of goods in the market. Hence it keeps the prices of goods within
permissible limits.
5) Discipline & Morale:
The management maintains the disciplines & boosts the morale of individuals by applying the
principles of decentralization & delegation of authority. It motivates the employees through
monitory & non monitory incentives. It helps in creating & maintaining better work culture.
6) Mobilizing Best Talent:
The employment of experts in various fields will help in enhancing the efficiency of various
factors of production. The better pay scales, proper amenities, future growth potentialities will
attract more people in joining the concern.
7) Promotion of Research & Development:
Management undertakes the research & development to take the lead over its competitors &
meet the uncertainties of the future. Thus it provides the benefits of latest research &
technology to the society.
8) Minimize the Element of Risk:
Management involves the function of forecasting. Though the exact future can never be
predicted yet on the basis of previous experience and existing circumstances, management can
minimize the element of risk.
9) Improving Performance:

10. Management should aim at improving the performance of each & every factor of production,
the environment should be so congenial that workers are able to contribute their maximum to
the enterprise.
10) Planning for Future:
Another important purpose of management is to prepare a prospective plan. No management
should feel satisfied with today’s work. Future plans should take into consideration what is to
be done next. Future performance will depend upon present planning. So planning for future is
essential to every organization.

11. Levels of Management:
Meaning:
An organization may have different levels of management. Levels of management refer
to a line of demarcation between various managerial positions in an organization. The level of
management depends upon its size, technical facilities & the range of production.
Considering the hierarchy of authority & responsibility management has been classified
in three levels:
Departmental Managers or Section Officers
Production Sales HR Purchase Finance
1) Top Management:
Top management of a company consists of owners/ shareholders, Board of directors, its
Chairman, Managing directors, General Managers, Executive committee having key officers etc.
Top management is the ultimate source of authority of authority & it lays down goals,
policies & plans for the enterprise. It devotes more time on planning & coordination functions.
It is accountable to the owners of the business for the overall management.
Top Management
Owners/Shareholders,Boardof
Directors, MD, Ex Commitee
Middle Management
Superintendents,Forman,Supervisors
Loweror SupervisoryManagement

12. Functions of Top Management
1) To establish the objectives or goals of the enterprise.
2) To make policies & frame plans to attain the objectives.
3) To setup an organizational framework to conduct the operations as per plans.
4) To assemble the resources of money, men, materials, machines & methods to put the
plans into action.
5) To exercise effective control over the operations.
6) To provide overall leadership to enterprise.
2) Middle Management:
Middle management of company consists of heads of functional departments viz.
purchase manager, production manager, marketing manager, financial controller etc.
The job of middle management is to implement the policies & plans framed by the top
management. It serves as an essential link between the top management & the lower level
management. They are responsible to the top management for the functioning of their
departments. They devote more time on organization & motivation functions of management.
Functions of Middle Management:
1) To interpret the policies chalked out by top management.
2) To recruit & select suitable operative & supervisory staff.
3) To assign activities, duties & responsibilities for timely implementation of plans.
4) To motivate personnel to attain higher productivity & to reward them properly.
5) To cooperate with the other departments for ensuring a smooth functioning of the
entire organization.
6) To report to top management.
3) Lower or Operative Management:
Lower level or operating management of a company consists of superintendents,
foreman, supervisors etc.
It is placed at the bottom of the hierarchy of management. Lower management
authority & responsibility is limited. They pass on the instructions of the middle management to
workers. They are also involved in the process of decision making. They have to get the work

13. done through the workers. They allot various jobs to the workers evaluate performance &
report to the middle level management. They are more concerned with direction & control
functions of the management. They devote more time on the supervision of workers.

14. Managerial Skills
There are different levels of management. So different types of skills are required for
each level of management. An effective manager generally makes use of the following skills:
1) Technical Skill:
Technical skill is a kind of knowledge which involves the use of requirements, techniques
and procedure for the accomplishment of specific tasks. It requires specialized knowledge &
proficiency in the area of job. Thus technical skill is the ability to work in a specified area.
2) Human skill:
Human skill refers to the ability to work effectively with other people as an individual & as
member of the team. A manager has to get the things done through other people & hence
must have human skills or ability to select, motivate, guide & control people.
3) Conceptual skill:
Conceptual skill is the ability to integrate & coordinate various activities. A manager needs
to have the qualities or skills so as to able to view situations & coordinate various factors.
4) Decision Making skill:
Management is the art of decision making. At all levels, managers have to take certain
decisions. To be a successful manager, one must have ability to analyze & examine a problem &
also the ability to work out a practical solution for the problem.
“To sum up conceptual skill deals with ideas, while human skill concerns people &
technical skill is with things.”
Top
Middle
Lower

15. Managerial Roles:
A manager’s job is very crucial in an enterprise. More complex the organization the more
crucial his role. The success of the organization will depend upon the caliber of a manager in
utilizing the resources for achieving enterprise objective.
According to Mintzberg, managerial roles are as follows:
1) Interpersonal Role:
This role involves activities with people working in the organization. This is supportive role
for informational & decisional roles.
a) As a Figure Head:
Formal authority of a manager enables him to occupy a special position of the status in the
enterprise. A manager has to perform many symbolic functions as a figure head of the
organization. He has to sign various papers for the organization, attend social functions of the
subordinates, greet people, speak at functions etc.
b) Leadership Role:
A manager is responsible for the activities of his subordinates. He has to act as a leader of the
group. He has to set the example of hard work & dedication so that subordinates follow his
direction with respect. He has to communicate, motivate & activate them to work to achieve
the desired goal.
c) Liaison Officer:
A manager has to establish contacts with higher management & subordinates. Similarly he has
to keep a watch on external environment, competitor’s strength, government policies etc. he
has to maintain liaison by attending meetings, conference, functions etc.
2) Information Roles:
This involves the role of assimilating & disseminating information as & when required.
Following are the main sub roles which managers often perform.
a) Monitoring information:
Collecting information from organizations both from inside & outside of the organization.
b) Disseminating Information:

16. Communicating information to organizational members.
c) Spokesperson:
Representing the organization to outsiders.
3) Decisional Role:
a) As an entrepreneur:
As an entrepreneur a manager has to take strategic decisions. He decides about expansion or
diversification. The decisions such as source of funds, arranging various inputs marketing
strategies etc. are taken by manager.
b) As a Disturbance handler:
There may be conflicts among employees or some grievances against management. A manager
has to act as an arbitrator in resolving disputes of employees. The employees may demand
higher wages, bonus, or other benefits. He tries to settle various disputes so that a cordial
relations are maintained in the organization.
c) As a Resource allocator:
A manager makes budgetary allocations for different departments. There may be a demand for
more personnel, more inputs or other resources. He allocates resources in such a way that
these are used in a optimum way & no activity suffers for their inadequacy.
d) As a Negotiator:
A manager has to negotiate with outsiders for taking certain decisions. The prices may be
negotiated with suppliers, the rates may be fixed with customers, the purchase of various
assets may be negotiated with manufacturers.

17. General Principles of Management
Fayol pointed out in his work the fourteen principles of management. According to him the list
is not exhaustive, but he has tried to describe only those which he had to follow at most of the
occasions.
1) Division of Work:
The work should be divided among persons based on their specialization. One man one work at
a time. All works cannot be handed over to a single man. It expects specialist to handle a special
job in all areas.
2) Authority & Responsibility:
The authority & responsibilities of a person are to be balanced. But in reality, people expect
more authority but less responsibility. It should not happen. Both should go hand in hand.
3) Discipline:
The obedience to rules & regulations is discipline. He considered discipline s absolutely
essential for the smooth running of business. At all the levels of management, adherence to set
practices should be followed by personnel. Contrary to this penalties are just impartial.
4) Unity of Command:
Unity of command means that a person should get orders & instructions from only one
superior. The more completely an individual has a reporting relationship to a single superior,
the less is the problem of conflict in instructions & the greater is the feeling of personal
responsibility for result.
5) Centralization:
The authority & necessary powers should be concentrated at top level management. The
degree of centralization depends upon the nature of organization & situation.
6) Unity of Direction:
According to this principle the direction to the group activities must be provided with one head
& with one plan. Unity of direction provides better coordination among various activities to be
undertaken by an organization.

18. 7) Subordination of Individual Interest to general Interest:
The organizational objectives are to be collectively achieved by individuals. The individual
interest should go hand in hand with organizational interest.
8) Scalar Chain:
According to Fayol, scalar chain is “the chain of superiors” ranging from the ultimate authority
to the lowest ranks.
The diagram shows that ‘A’ holds the ultimate authority in the two departments. ‘A’ will give
orders to ‘B’ & ‘B’ will pass on to ‘C’ & so on. Similarly ‘A’ will issue instructions to ‘W’, who will
pass on these to ‘X’ & so on. Now if ‘C’ wants to consult ‘X’ then ‘C’ approach to ‘B’ & ‘B’ to ‘A’.
‘A’ will inform ‘W’ & ‘W’ to ‘X’. So it will take long time. Fayol felt that departure from the chain
is necessary to make the communication fast & effective. If ‘C’ talks directly to ‘X’ & both get
the approval of their superiors about the agreement, there is no harm. Communication should
be short circuited as far possible.
9) Remuneration of Personnel:
Remuneration of employees should be fair & provide maximum possible satisfaction to
employees & employer. The remuneration method should promote efficient worker with fair
return.
10) Order:
This is a principle relating to the arrangement of things & people. This principle says that there
should be the right person for the right job & right material in right place. Everything & men be
placed in the right order.
11) Initiative:
Within the limits of authority & discipline managers should encourage their employees for
taking initiative. Initiative is concerned with thinking out & execution of plan. Initiative
increases zeal & energy on the part of human beings.

19. 12) Stability of tenure of Personnel:
No employee should be removed within short time. There should be reasonable security of
jobs. Stability of tenure is essential to get an employee accustomed to new work & succeeding
in doing it well. Unnecessary turnover is both cause & effect of bad management.
13) Equity:
Equity is the combination of justice & kindness. Equity in treatment & behavior is liked by
everyone & it brings loyalty in the organization. The management should treat men with
humanity & kindness.
14) Esprit de Corps:
This is the principle of “Union is strength” & extension of unity of command for establishing
team work. Literally speaking, the phrase ‘esprit de corps’ means the spirit of loyalty & devotion
which unites the members of a group.

20. Hawthorne Experiment
Elton Mayo & his associates conducted Hawthorne studies between 1927-1932 at
Hawthorne Plant of Western Electric Co. near Chicago in USA. The initial objective was to
examine the effective of fatigue on workers but this was greatly extended to evaluate attitudes
& psychological reactions of the workers in on the job situations, under varying conditions of
work( Illumination, hours of work, rest pause, financial & non financial benefits). These studies
were conducted to determine the effect of better physical facilities on workers output. A
number of experiments were conducted on the workers to know the effect of different
situations on their efficiency.
Following are the four phases of Hawthorne Experiment:
1) Illumination Experiment
2) Relay Assembly Test Group
3) Interviewing Program
4) Bank wiring Observation Room Experiment
1) Illumination Experiment:
This experiment was conducted to observe the effect of illumination on two groups of
employees making telephone relays. In one group (Test Group) the intensity of light was
changed whereas in the other group (Control Group), illumination was kept constant.
Surprisingly, the productivity increased even when the light in the first group was redused.
The researchers concluded that illumination was not the cause of low productivity,
certain other factors might be responsible for low productivity.
2) Relay Assembly Test Group:
In this experiment two groups of female relay assembler were put under observation in
separate rooms. One observer was also put in first room to record the work & create a friendly
atmosphere. In first room a number of experiments were made & in second room number
changes were made.
Tests; Rest pause, changes in incentive system, changes in work days & working hours etc.

21. 3) Interviewing Program:
Mayo initiated a three year long interviewing program & covered more than twenty one
thousand employees to find out the reasons for increase in production. Interviews were
conducted by direct questions. The method was not successful due to direct questions &
workers did not answer the questions properly. The method was then changed to indirect
interview talking just made the difference.
4) Banking Wiring Observation Room Experiment:
In this experiment hourly wage for each worker was fixed on the basis of average output of
each worker. Bonus was also payable on the basis of group effort. It was expected that highly
efficient workers would bring pressure on less efficient workers to increase output & take
advantage of group incentive plan. But the strategy did not work.
The Hawthorne Experiments clearly showed that a man at work is motivated by more
the satisfaction of economic needs. Management should recognize that people are essentially
social beings & not merely economic beings. As a social group they are members of a group &
the, management should try to understand group attitudes & group psychology.

22. Management is an art or Science:
There is controversy about identifying management with art or science. The experts
opine that management is an old art & modern science. It is an old art because the roots of
management can be seen with the growth of civilization and it is modern science as it has
incorporated with principles explaining the cause & effect of an organization.
Management is an Art:
Management is an art of getting things done through others. Here the term art means
the know-how required to accomplish the desired result. This know how requires creative
power & skill in performance. The thrust is on searching the ways of doing things. The skill
required for the same is obtained from the constant practice of the theoretical concept.
It basically expects the application of knowledge to the practical business world.
Because the management executives are not expected to depend on luck. Therefore
management is called an art due to the following reasons:
 Management involves creativity.
 Managerial personnel have skill in performance.
 The practice of management needs the sound theoretical knowledge.
 The principles of management are applied to manage the affairs of an organization.
 Skill differs from individual to individual.
Management is a Science:
Science refers to a systematized body of knowledge. It explains about truth, cause &
effect relationship. The relationship between two variables is explained through experiments.
The ultimate object is to draw a set of principles. When this is applied to management, the
process & practice of it is based on principles.
 It has the following features:
 It is a systematized body of knowledge.
 It uses scientific methods to observe.
 The management principles are based on continuous experiments & observation.
 Principles drawn are universally applicable to the similar situations.
Though the features of science are clearly visible with management, it cannot be equated
with exact science or natural science. In science we can exactly prove that two atoms of
Hydrogen & One atom of Oxygen form one molecule of water. Such things cannot happen
in management due to the involvement of human factor.

23. Management is a Profession:
In depth knowledge of any subject is a profession. The experts feel that the
management is a profession. The management of an organization needs the requisite
knowledge & right mental ability.
The following features support to identify the management as a profession.
 Management has code of conduct.
 Management deals with honesty & integrity.
 Management professionals are governed by organization.
 Management has become a discipline of higher studies at the university level. There are
number of institutions to train the management professionals.
 Management is a distinct function which demands the academic & professional training.
 Growing business world expect the consultation services of professions.
In general words management is an art, science & a profession too. Management as a
discipline has all the elements of science & art. The skill component is required to make use
of principles of science. Its growth as a profession in recent years is worth noticing. It is
mainly due to the growth of corporate sectors.

24. Scientific Management:
According to F.W.Taylor, scientific management is “knowing exactly what to do & seeing
that it is done in the best & cheapest way.”
In simple words scientific management implies the art of knowing exactly what is to be
done & how it is to be done. Under this approach, scientific techniques are applied in the
recruitment, selection & training of workers & are also used in tackling various industrial
problems.
Characteristics of Scientific Management:
1. It is systematic, analytical & objective approach to tackle industry problems.
2. It uses scientific techniques in methods of work, recruitment, selection & training of
workers.
3. It strives to discover the best method of doing a work at the cheapest cost.
4. It brings a complete change in the mental attitude of workers as well as the
management.
5. It puts stress on all factors of production, men, material & technology.
Objectives of Scientific Management:
1. Acceleration in the rate of productivity by the use of standardized tools, equipments &
methods.
2. Betterment in the quality of the product by research, quality control & effective
inspection.
3. Decrease in the cost of production of systemplanning & regulation & cost control
techniques.
4. Avoidance of wastage in the use of resources, time & method of production.
5. Placement of the right person on the right job through scientific selection & training.
6. Setting up a sound systemof wage payment so as to attain maximum efficiency.
7. Ensuring a regular supply of goods to consumers at reasonable prices.