Function of Management


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Presentation of Principle of Management by Biyan Belinda

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Function of Management

  1. 1. Function of management Organizing – to create structure Controlling – to ensure results Leading – to inspire effort Planning – to set the direction
  2. 2. Organizing  The process of arranging people and other resources to work together to accomplish a goal.  Organizing is needed to create the structures. 0 Divide up the work 0 Arrange resources 0 Coordinate activities
  3. 3. Organization Structure  A system of tasks, workflows, reporting relationships, communication channels that link together the work of diverse individuals and groups.
  4. 4. Organization Chart  A diagram that shows reporting relationships and the formal arrangement of work positions within an organization.  Shows the formal structure ; official structure of the organization.
  5. 5. The basics of an organization’s formal structure 0 Division of work – positions and titles shows work responsibilities 0 Supervisory relationship – lines show who report to whom 0 Communication channels – lines show formal communication flows 0 Major subunits – positions reporting to a common manager 0 Levels of management – vertical layer of management
  6. 6. Informal Structure  The set of unofficial relationship among an organization’s member.  Show who talks to and interacts regularly with whom, regardless of their formal titles and relationship.  Sources of emotional support and friendship that satisfy important social needs.
  7. 7. Social Network Analysis  A tool to identify the informal structures and their embedded social relationships that are active in organization.
  8. 8. Disadvantages from informal structure 0 Susceptible rumor 0 Carry inaccurate information 0 Breed resistance to change 0 Divert work efforts from important objectives
  9. 9. Traditional Organization Structure Ciri : Departementalization  The process of grouping people and jobs into work units Traditional Organization Structure is divided by 3 major types : 1. Functional structure 2. Divisional structure 3. Matrix structure
  10. 10. Functional Structure Grouping people with similar skills who perform similar tasks. Advantages : 1. Economic of scale with efficient use of resources 2. Task assignments consistent with expertise and training 3. High-quality technical problem solving 4. In-depth training and skill development within function 5. Clear career paths within function Disadvantages : Functional chimney problem A lack of communication, coordination, and problem solving across function. It’s because mind-sets of people become formalized.
  11. 11. Director Financial Marketing Operational Human Resources Commissioner
  12. 12. Divisional Structure Groups together people working on the same product, in the same area, with similar costumers, or on the same processes. Divided by 4 types of stuctures : 1. Product structure : groups together people and jobs focused on a single product or service 2. Geographical structure : groups together people and jobs performed in the same location 3. Customer structure : groups together people and jobs that serve the same customers or clients 4. Process structure : groups jobs and activities that are part of the same processes *work process : a group of related tasks that collectively creates a valuable work product.
  13. 13. Director Product Geography Customer Product Commissioner
  14. 14. 0 Advantages : 1. More flexibility in responding to environmental changes 2. Improved coordination across functional departements 3. Clear points of responsibility for product or service delivery 4. Expertise focused on spesific customers, products, and regions 5. Greater ease in changing size by adding or deleting divisions
  15. 15. 0 Disadvantages 1. Reduce economic of scale 2. Increase costs through the duplication of resources and effort across divisions 3. Create unhealthy rivalries as divisions compete for resources and top management attention 4. As they emphasize division needs over the goals of the organization as a whole
  16. 16. Matrix Structure Often called as matrix organization, combines the functional and divisional structure to emphasize project or program teams.  Found in multinational corporations, where they offer the flexibility to deal with regional differences while still handling multiple product, program, or project needs.
  17. 17. 0 Advantages 1. Better communication and cooperation across function 2. Improved decision making; problem solving takes place at the team level where the best information is available 3. Increased flexibility adding, removing, or changing operations to meet changing demands 4. Better customer service ; there is always a program, product, or project manager informed and available to answer questions 5. Better performance accountability through the program, product, or project managers 6. Improved strategic management ; top managers are freed from lower-level problem solving to focus time or more strategic issues
  18. 18. 0 Disadvantages 1. The two-boss system is susceptible to power struggles if functional supervisors and team leader compete with one another to exercise authority 2. The two-boss system can be frustrating it creates task confusion and conflicting work priorities 3. The teams may develop “groupitis”, then the strong team loyalties can cause a loss of focus on larger organizational goals
  19. 19. Horizontal Organization Structure Part of broader movement to organize structure from matrix structure. Goals : 1. Improve communication 2. Collaboration 3. Flexibility by decreasing hierarchy, increasing empowerment, better mobilizing human talents
  20. 20. Team Structure Uses permanent and temporary cross-functional teams to improve lateral relations. Cross-functional team  brings together members from different functional departement Project teams  convened for a particular task or project and disband once it is completed
  21. 21. 0 Advantages 1. Team assignment can break down barriers as people from different parts of an organization to get know one another  boost morale 2. People working in teams oftem experience a greater sense of involvement and identification  increase enthusiasm for job 3. Improve the speed and quality of decisions in many situations
  22. 22. 0 Disadvantages 1. Conflicting loyalties with both team and functional assignments 2. Issues of time management and group process 3. Teams spend a lot of time in meetings, but not all of that time is productive
  23. 23. Network Structure Uses information technologies to link with networks of outside suppliers and service contractors. Strategic alliance : cooperation agreement with another organization to jointly pursue activities of mutual interest.
  24. 24. 0 Advantages Lean and streamlined, helping organizations stay cost- competitive by reducing overhead and increasing operating efficiency. 0 Disadvantages  The more complex the business or mission of the organization, the more complicated it is to control and coordinate the network of contracts and alliances.
  25. 25. Boundaryless Structure Eliminates internal boundaries among subsystems and external boundaries with the external environment. Virtual organization  uses IT and the internet to engage a shifting network of strategic alliances. e.g. : MySpace, Facebook, LinkedIn
  26. 26. Research and Development Sales Purchasing Production Distribution
  27. 27. Organizational Designs The process of creating structures that accomplish mission and objectives. Contingency in Organizational Design  Beaureaucracy, emphasizes formal authority, order, fairness, and efficiency
  28. 28. Mechanistic and Organic Design Mechanistic design  centralized, with many rules and procedures, a clear-cut division of labor, narrow spans of control, and formal coordination Organic design  decentralized, with fewer rules and procedures, open divisions of labor, wide spans of control, and more personal coordination Adaptive design  operates with minimum of beaureaucratic features and encourages worker empowerment and teamwork
  29. 29. Trends in Organizational Design 0 Fewer level of management Shows the chain command : links all persons with successively higher levels of authority Including : 1. Span of control : number of subordinates directly reporting to a manager 2. Tall structure : have narrow spans of control and many hierarchical levels, or 3. Flat structure : have wide spans of control and few hierarchical levels
  30. 30. 0 More delegation and empowerment Delegation  process of distributing and entrusting work to other persons Empowerment  allows others to make decisions and exercise discretion in their work
  31. 31. 0 Decentralization and centralization Centralization  concentration of athority for most decisions at the top level of an organization Decentralization  dispersion of authority to make decisions throughout all organization levels
  32. 32. 0 Reduced use of staff Staff positions : provide technical expertise for other parts of the organization
  33. 33. Leading Leadership : process of inspiring others to work hard to accomplish important tasks. Power : the ability to get someone else to do something you want done or to make things happen the way you want.
  34. 34. Position Power Reward Power The capacity to offer something of value as a means of influencing other people. Coercive Power The capacity to punish or withhold positive outcomes as a means of influencing other people. Legitimate Power  The capacity to influence other people by virtue of formal authority, or the rights of office
  35. 35. Reward Power • “If you do what I ask, I’ll give you a reward.” Coercive Power • “If you don’t do what I ask, I’ll punish you.” Legitimate Power • “Because I am the boss ; you must do as I ask”
  36. 36. Personal Power Expert power The capacity to influence other people because of specialized knowledge. Referent power  The capacity to influence other people because of their desire to identify personally with you.
  37. 37. Leadership and Vision Vision : a clear sense of the future Visionary leadership  brings to the situation a clear sense of the future and an understanding of how to get there.
  38. 38. Leadership as Service Servant leadership follower-centered and committed to helping others in their work Empowerment enables others to gain and use decision- making power.
  39. 39. Leadership Traits and Behaviors 0 Leadership traits 1. Drive 2. Self-confidence 3. Creativity 4. Cognitive ability 5. Job-relevant knowledge 6. Motivation 7. Flexibility 8. Honesty and integrity
  40. 40. 0 Leadership behavior 1. A leader high in concern for task ; plans and defines the work to be done 2. A leader high in concern for people ; acts with warmth and supportiveness toward followers
  41. 41. Classic Leadership Styles 0 Leadership style : the recurring pattern of beahaviors exhibited by a leader 0 Autocratic : acts in command-and-control fashion 0 Human relations : leader emphasizes people over task 0 Laissez-faire : leader has a do “do the best you can and don’t bother me” attitude 0 Democratic style : leader emphasizes both tasks and people
  42. 42. Fiedler’s Contingency Model 0 Understanding Leadership Style The least-preffered co-worker scale  to measure a person’s leadership style 0 Understanding Leadeship Situations Three factors of situations control : 1. Quality of leader-member relations 2. Task structure 3. Position power 0 Matching Leadership Style and Situation
  43. 43. Hersey-Blanchard Situational Leadership Model 0 Delegating 0 Participating 0 Selling 0 Telling
  44. 44. Path-Goal Leadership Theory 0 Directive leadership 0 Supportive leadership 0 Achievement-oriented leadership 0 Participative leadership
  45. 45. Leader-Participation Model 0 Authority decision : made by the leader and then communicated to the group 0 Consultative decision : made by a leader after receiving information, advice, or opinions from group member 0 Group decision : made by group members themselves
  46. 46. Personal Leadership Development 0 Charismatic and transformational leadership 0 Emotional intelligence 0 Gender 0 Interactive leadership 0 Moral leadership
  47. 47. Drucker’s “Old-Fashioned” Leadership Drucker’s Leadership Wisdom 0 Define and communicate a clear vision 0 Accept leadership as a responsibility, not a rank 0 Surround yourself with talented people 0 Don’t blame others when things go wrong 0 Keep your integrity ; earn the trust of others 0 Don’t be clever, be consistent
  48. 48. Controlling The process of measuring performance and taking action to ensure desired results Make sure that the things happen in the right way and the right time
  49. 49. Types of Controls Feedforward Controls Ensures that directions and resources are right before the work begins Concurrent Controls Focuses on what happens during the work process Feedback Controls  Takes places after an action is completed. Also called as post-action controls.
  50. 50. Internal and External Control Self-control Internal control that occurs through self-dicipline in fulfilling work and personal responsibilities Beaureaucratic control Influences behavior through authority, policies, procedures, job descriptions, budgets, and day-to-day supervision Clan control Influences behavior through norms and expectations set by the organizational culture Market control Essentially influence of the market competition on the behavior of organizations and their members
  51. 51. The Control Process STEP 1 : Establish objectives and standards 0 Output standards  measures performance results in terms of quantity, quality, cost, or time. 0 Input standards  measures work efforts that go into a performance task
  52. 52. STEP 2 : Measure performance results STEP 3 : Compare results with objectives and standards The control equation states : Need for action = Desired performance – Actual performance STEP 4 : Take corrective action Management by exception : the practice of giving attention to situations that show the greatest need for action.
  53. 53. Control Tools and Techniques 0 Employee dicipline systems 0 Project management and control  use gantt chart ; graphically displays the scheduling of tasks required to complete a project 0 CPM/PERT techniques CPM/PERT : combination of the critical part method and the program evaluation and review technique. 0 Financial Controls
  54. 54. Gantt Chart  timeline of job Date/ Tasks 1 2 3 4 5 6 7 8 9 T-I T-II T-III T-IV T-V T-VI T-VII
  55. 55. 0 Balanced Scorecard Tallies organizational performance in financial, customer service, internal process, and innovation and learning areas. Balanced Scorecard Financial Internal (SOP) Learning and Grow Customer