01 Introduction to Management PDF

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01 – Introduction to ManagementManagement and OrganizationsIn today’s tough and uncertain economy, a company needs strong managers to lead its staff toward accomplishing business goals. But managers are more than just leaders – they are problem solvers, cheerleaders, and planners as well. And manage...

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Introduction to Management – Compiled by J. Langat

01 – Introduction to Management Management and Organizations In today’s tough and uncertain economy, a company needs strong managers to lead its staff toward accomplishing business goals. But managers are more than just leaders – they are problem solvers, cheerleaders, and planners as well. And managers don’t come in one-size-fits-all shapes or forms. Managers fulfil many roles and have many different responsibilities at each level of management within an organization. Organizations abound in today’s society. Groups of individuals constantly join forces to accomplish common goals. An organization is defined as a group of two or more people working together in a predetermined fashion to attain a set of goals. These goals may include such things as profit (Unilever, EABL, BAT, etc), spreading knowledge (Egerton, Kabarak, Moi, etc), national defence (Army, Navy, Air Force, etc), social satisfaction (college social groups, clubs, etc) etc (Griffin). Absence of organization means chaos, anarchy, and little or no productivity. Organized life requires direction or management. Management (from Old French ménagement “the art of conducting, directing”, from Latin manu agere “to lead by the hand”) characterises the process of leading and directing all or part of an organization, often a business, through the deployment and manipulation of resources (human, financial, material, intellectual or intangible). Early twentieth-century management writer, Mary Parker Follett defined management as “the art of getting things done through people.” Management has further been defined as the process of planning, organizing, leading, and controlling an organization’s human, financial, physical, and information resources to achieve organizational goals in an efficient and effective manner (Griffin). Management then is the process of achieving an organization’s goal through the coordinated performance of five specific functions: planning, organizing, staffing, directing (leading), and controlling. Managers appear in every organization – at least in organizations that want to succeed. These individuals have the sometimes-unenviable task of making decisions, solving difficult problems, setting goals, planning strategies, and rallying individuals. And those are just a few of their responsibilities! To be exact, managers administer and coordinate resources effectively and efficiently to achieve the goals of an organization. In essence, managers get the job done through other people. A manager, then, is someone whose primary activities are a part of the management process. In particular, a manager is someone who plans, organizes, leads, and controls human, financial, physical, and information resources.

Levels of management Two leaders may serve as managers within the same company but have very different titles and purposes. Large organizations, in particular, may break down management into different levels because so many more people need to be managed. Typical management levels fall into the following categories: •

Top level: Managers at this level ensure that major performance objectives are established and accomplished. Common job titles for top managers include chief executive officer (CEO), chief operating officer (COO), managing director (MD), president, and vice president. These senior managers are considered executives, responsible for the performance of an organization as a whole or for one of its significant parts. 1

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Introduction to Management – Compiled by J. Langat Middle level: Middle managers report to top managers and are in charge of relatively large departments or divisions consisting of several smaller units. Examples of middle managers include clinic directors in hospitals; deans in universities; and division managers, plant managers, and branch sales managers in businesses. Middle managers develop and implement action plans consistent with company objectives, such as increasing market presence. Figure 1: Levels of Management

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Low level: The initial management job that most people attain is typically a first-line management position, such as a team leader or supervisor – a person in charge of smaller work units composed of hands-on workers. Job titles for these first-line managers vary greatly, but include such designations as department head, group leader, and unit leader. First-line managers ensure that their work teams or units meet performance objectives, such as producing a set number of items at a given quality, that are consistent with the plans of middle and top management.

Figure 2: Kenya’s Vision 2030 and its pillars

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Introduction to Management – Compiled by J. Langat

Functions of Managers Managers just don’t go out and haphazardly perform their responsibilities. Good managers discover how to master five basic functions: planning, organizing, staffing, leading, and controlling. •

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Planning: This step involves mapping out exactly how to achieve a particular goal. Say, for example, that the organization’s goal is to improve company sales. The manager first needs to decide which steps are necessary to accomplish that goal. These steps may include increasing advertising, inventory, and sales staff. These necessary steps are developed into a plan. When the plan is in place, the manager can follow it to accomplish the goal of improving company sales. Organizing: After a plan is in place, a manager needs to organize her team and materials according to her plan. Assigning work and granting authority are two important elements of organizing. Staffing: After a manager discerns his area’s needs, he may decide to beef up his staffing by recruiting, selecting, training, and developing employees. A manager in a large organization often works with the company’s human resources department to accomplish this goal. Leading: A manager needs to do more than just plan, organize, and staff her team to achieve a goal. She must also lead. Leading involves motivating, communicating, guiding, and encouraging. It requires the manager to coach, assist, and problem solve with employees. Controlling: After the other elements are in place, a manager’s job is not finished. He needs to continuously check results against goals and Figure 3: The Functions of Management take any corrective actions necessary to make sure that his area’s plans remain on track.

All managers at all levels of every organization perform these functions, but the amount of time a manager spends on each one depends on both the level of management and the specific organization.

Managerial Roles A manager wears many hats. Not only is a manager a team leader, but he or she is also a planner, organizer, cheerleader, coach, problem solver, and decision maker – all rolled into one. And these are just a few of a manager’s roles. A role is an organized set of behaviours. In his classic book, The Nature of Managerial Work, Henry Mintzberg describes a set of ten roles that a manager fills. Henry Mintzberg reduced to 10 roles the thousands of specific tasks that managers need to perform as they plan, organize, staff, lead, and control organizational resources. Mintzberg grouped the 10 roles into three broad categories: interpersonal, informational, and decisional. Managers often perform many of these roles from minute to minute while engaged in the more general functions of planning, organizing, staffing, leading, or controlling. Interpersonal roles are assumed by managers to provide direction and supervision for both employees and the organization as a whole. These roles arise from the manager’s formal authority, and include: (i) The figurehead or ceremonial role: a large part of a chief executive’s time is spent representing the company at dinners and conferences; he performs a number of routine duties of a legal or social nature such as greeting visitors and signing legal documents. 3

Introduction to Management – Compiled by J. Langat (ii) The leader role involves hiring, firing and training staff; motivating the employees of the organization, that is, to help the employees reach their full potential; reconciling individual needs with the requirements of the organization. (iii) The liaison role is what managers perform when making contacts outside the vertical chain of command. As a liaison, managers link and coordinate the activities of people and groups both inside and outside the organization. Mintzberg says that the purpose of these contacts is to build up an informal information system, but at the same time they are a means of extending influence both within an organization and outside. Figure 4: Henry Mintzberg’s Managerial Roles.

Informational roles are closely associated with the tasks necessary to obtain and transmit information. As a leader, a manager has access to every member of staff, and is likely to have more external contacts than any of them. A manager’s liaison contacts means that he or she is a channel of information from inside the department to outside and vice versa. Mintzberg, in an article published in the Harvard Review in 1975 states: “The manager does not leave meetings or hang up the telephone in order to get back to work. In a large part communication is his work.” Mintzberg identifies three types of informational roles: (i) The manager monitors the environment, and receives information from subordinates or peers in other departments. Note that much of this information is of an informal nature, derived from his or her network of contacts. It might be gossip or speculation. Managers monitor activities of consultants and organize and control them on a global level. (ii) As a disseminator, the manager disseminates information, which he or she has acquired both formally through the vertical chain of command and informally through the network of contacts, to subordinates in the department. He also makes memos and calls other personnel. (iii) As a spokesman, the manager provides information to interested parties, either within or outside the organization. He represents the company or division to the outside. This can be the media, other companies, clients, or even to the supply chain. Decisional roles: The manager’s formal authority and access to information means that no one else is in a better position to take decisions relating to the work of the department. Decisional roles are closely associated with the methods mangers use to plan strategy and utilize resources. 4

Introduction to Management – Compiled by J. Langat (i) A manager acts as a sort of entrepreneur by initiating projects, quite possibly of a small scale, a number of which may be on the go at any one time, to improve the department or to help it react to a changed environment. (ii) A manager has to respond to pressures over which the department has no control. A manager is therefore a disturbance handler, taking decisions in unusual situations which are impossible to predict. He is the one to contact when there are any disruptions. For example, when a production line fails or when the supply chains fail to deliver on time. (iii) A manager takes decisions relating to the allocation of scarce resources. As a resource allocator, the manager determines the department’s direction, and authorizes decisions taken by subordinates. He ensures that each process receives a fair and good number of resources in order to use for their sub process of transformation. (iv) Negotiation both inside and outside the organization takes up a great deal of management time, but is a vital component of managerial work. Managers also act as a negotiator¸ reaching agreements with other managers or groups claiming the first right to resources, or with the organization and outside groups such as suppliers or customers. The supervisor performs these managerial roles but with different emphasis than higher managers. Supervisory management is more focused and short-term in outlook. Thus, the figurehead role becomes less significant and the disturbance handler and negotiator roles increase in importance for the supervisor. Since leadership permeates all activities, the leader role is among the most important of all roles at all levels of management.

Skills Needed by Managers Not everyone can be a manager. Certain skills, or abilities to translate knowledge into action that results in desired performance, are required to help other employees become more productive. These skills fall under the following categories: •

Technical: This skill requires the ability to use a special proficiency or expertise to perform particular tasks. Accountants, engineers, market researchers, and computer scientists, as examples, possess technical skills. Managers acquire these skills initially through formal education and then further develop them through training and job experience. Technical skills are most important at lower levels of management.

Figure 5: Skills Needed by Managers at Different Levels

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Introduction to Management – Compiled by J. Langat Human: This skill demonstrates the ability to work well in cooperation with others. Human skills emerge in the workplace as a spirit of trust, enthusiasm, and genuine involvement in interpersonal relationships. A manager with good human skills has a high degree of self-awareness and a capacity to understand or empathize with the feelings of others. Some managers are naturally born with great human skills, while others improve their skills through classes or experience. No matter how human skills are acquired, they are critical for all managers because of the highly interpersonal nature of managerial work. Conceptual: This skill calls for the ability to think analytically. Analytical skills enable managers to break down problems into smaller parts, to see the relations among the parts, and to recognize the implications of any one problem for others. As managers assume ever-higher responsibilities in organizations, they must deal with more ambiguous problems that have long-term consequences. Again, managers may acquire these skills initially through formal education and then further develop them by training and job experience. The higher the management level, the more important conceptual skills.

Importance of Management •

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It helps in Achieving Group Goals – It arranges the factors of production, assembles and organizes the resources, integrates the resources in effective manner to achieve goals. It directs group efforts towards achievement of pre-determined goals. By defining objective of organization clearly there would be no wastage of time, money and effort. Management converts disorganized resources of men, machines, money etc. into useful enterprise. These resources are coordinated, directed and controlled in such a manner that enterprise work towards attainment of goals. Optimum Utilization of Resources – Management utilizes all the physical & human resources productively. This leads to efficacy in management. Management provides maximum utilization of scarce resources by selecting its best possible alternate use in industry from out of various uses. It makes use of experts, professional and these services leads to use of their skills, knowledge, and proper utilization and avoids wastage. If employees and machines are producing its maximum there is no under employment of any resources. Reduces Costs – It gets maximum results through minimum input by proper planning and by using minimum input & getting maximum output. Management uses physical, human and financial resources in such a manner which results in best combination. This helps in cost reduction. Establishes Sound Organization – No overlapping of efforts (smooth and coordinated functions). To establish sound organizational structure is one of the objective of management which is in tune with objective of organization and for fulfilment of this, it establishes effective authority & responsibility relationship i.e. who is accountable to whom, who can give instructions to whom, who are superiors & who are subordinates. Management fills up various positions with right persons, having right skills, training and qualification. All jobs should be cleared to everyone. Establishes Equilibrium – It enables the organization to survive in changing environment. It keeps in touch with the changing environment. With the change is external environment, the initial coordination of organization must be changed. So it adapts organization to changing demand of market / changing needs of societies. It is responsible for growth and survival of organization. Essentials for Prosperity of Society – Efficient management leads to better economical production which helps in turn to increase the welfare of people. Good management makes a difficult task easier by avoiding wastage of scarce resource. It improves standard of living. It increases the profit which is beneficial to business and society will get maximum output at minimum cost by creating employment opportunities which generate income in hands. Organization comes with new products and researches beneficial for society.

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Introduction to Management – Compiled by J. Langat

The Evolution of Management Thought The schools of management thought are theoretical frameworks for the study of management. Each of the schools of management thought are based on somewhat different assumptions about human beings and the organizations for which they work. Since the formal study of management began late in the 19th century, the study of management has progressed through several stages as scholars and practitioners working in different eras focused on what they believed to be important aspects of good management practice. Over time, management thinkers have sought ways to organize and classify the voluminous information about management that has been collected and disseminated. These attempts at classification have resulted in the identification of management schools. Disagreement exists as to the exact number of management schools. Different writers have identified as few as three and as many as twelve. Table 1: Five Major Schools of Management Thought Those discussed below include (1) the classical school, (2) the behavioural school, (3) the quantitative or management science school, (4) the systems school, (5) and the contingency school. The formal study of management is largely a twentiethcentury phenomenon, and to some degree the relatively large number of management schools of thought reflect a lack of consensus among management scholars about basic questions of theory and practice. Table 1 provides a brief summary of five major schools of management thought, their approximate dates of origin, and their relative areas of emphasis. The following sections discuss each of the management.

Classical Schools of Management The classical school is the oldest formal school of management thought. Its roots pre-date the twentieth century. It developed during the Industrial Revolution when new problems related to the factory system began to appear. Managers were unsure of how to train employees or deal with increased labour dissatisfaction, so they began to test solutions. As a result, the classical management theory developed from efforts to find the “one best way” to perform and manage tasks. The classical school of thought generally concerns ways to manage work and organizations more efficiently. Three areas of study that can be grouped under the classical school are scientific management, administrative management, and bureaucratic management.

Classical scientific school In the late 19th century, management decisions were often arbitrary and workers often worked at an intentionally slow pace. There was little in the way of systematic management and workers and management were often in conflict. Scientific management was introduced in an attempt to create a mental revolution in the workplace. It can be defined as the syst...