UNIT -1

BY – ANKUSH RAWAL

SUBJECT-

FUNDAMENTAL OF
MANAGEMENT
MEANING OF MANAGEMENT-
Management is the process of getting things
done with the aim of achieving goal effectively and
efficiently.
It is an activity which is necessary wherever there is a
group of people working in an organization. People in
an organization are
performing diverse tasks but they all are working
towards the same goal.
DEFINITIONS
“Management is the process by which a cooperative
group directs actions of others towards common goals.”
-Massie and Douglas

“ Management is the art of getting things done

through people” - Mary parker Follett

“ Management is the coordination of all resources through

the process of planning, organizing, directing &
controlling in order to attain stated objectives.”
- Henry L. Sisk
1. Goal oriented process
2. Group & not an individual activity
3. All pervasive
4. Dynamic in nature
5. Intangible force-
Management cannot be seen but its presence can be felt
when targets are achieved according to plans , employees
are happy and satisfied.
1. Continuous process
2. Art of getting work done from people
3. Management is multidimensional-
Management does not mean one single activity but it
includes three main activities:
a)Management of work
b)Management of people c)Manageme
nt of operations

Management of work-
All organization are setup to perform some tasks or
goal.
Management of people-
People refers to human resource & human resource are
the most important assets of an organization.
Management of operations-
Operations refers to activities of production cycle such as
buying inputs, converting them into semi-finished goods, f
inished goods.
There are mainly 3 objectives of management- 1
).Organizational objectives-
a) Survival
b) Profit
c) Growth
2) Social objectives-
Management is not only a representative of the owners &
workers but is also responsible to the various groups
outside the organization. It is expected to fulfill the
objectives of the society which are given below:
a) Quality products.
b) Reasonable price
a) Employment opportunities
b) Eco- friendly methods of production.
3)Personal objectives-
An organization consist of several persons who have th
eir own objectives. These objectives are as follows:
*Fair remuneration for work performed.
* Opportunities for training & development..
* Participation in management .
IMPORTANCE OF MANAGEMENT-
* Achievement of group goals
* Optimum utilization of resources
* Reduce wastage
* Increases efficiency
* Encourage initiative
*Motivates employees
* Encourage innovation
* Facilitates growth & expansion
*Helps in achieving personal goals.
 TOP LEVEL

MIDDLE LEVEL

LOWER
LEVEL
1)TOP LEVEL –
*Top level management do all the major decision making in
the organization.

* It includes, the Chairman, CEO, President, Vice President

, HOD, Board of Directors etc.
2) MIDDLE LEVEL-

*People of this group are responsible for executing the

plans & policies made by top level.

* It includes HR Manager, Production Manager ,

Marketing manager, Finance Manager etc.
*The lower level of management is directly responsible
for implementation of plans developed by top
management & instructions given by middle level
management.

*They are the lowest level in the hierarchy of the

organization with very limited authority.

*They mainly focuses on directing & controlling.

*It includes supervisors ,foreman, clerk etc.
1) Determining the objectives of the
enterprise.
2) Framing of plans & policies.
3) Organizing the activities to be performed by the middle
level managers.
4) Assembling all the resources such as finance,
fixed assets etc.
5) To be responsible for welfare & survival of
the organization.
1) They analyses business environment & its effect
on organization.
 FUNCTIONS OF MIDDLE LEVEL
MANAGEMENT-
1) To interpret the policies formed by top mgt. to
lower management.
2) Organizing the activities of their department.
3) To assign necessary duties & responsibilities to the
employees of their respective department for
implementation of the plan.
4) To motivate employees of their respective
department for higher productivity & to achieve the
desired goal.
1) To cooperate with other department for smooth
functioning of the organization.
2) Finding out or recruiting/selecting & appointing the
required employees.
FUNCTIONS OF LOWER LEVEL MANAGEMENT-
1) First line managers interact with actual work
force & transfer the information & instructions
provided by the top & middle level management.
1) They oversee the efforts of the
workforce to achieve the maximum output at
minimum cost of production.
2) They supervise & monitor the production process.
3) They ensure that there is minimum wastage of
resources & best quality of output is achieved.
4) They lead, direct & motivate workforce to achieve the
organizational goals more effectively.
5) They are responsible to maintain discipline
among the entire workforce.
6) They appraise the performance of their
subordinates & recognize their efforts in the form of
rewards, incentives or promotions.
Management as a science-

Management as science

Feature of science Feature of

Feature of
which is also science which is
science partially
present in not present in
present
management management

Principles are
based on Universal
Systematic body validity
of knowledge repeated
experiments
Management as an art-
The basic features of an art are as follows:
1)EXISTENCE OF THEORETICAL KNOWLEDGE
1) BASED ON CONTINUOUS PRACTICE
2) CREATIVITY

MANAGEMENT IS AN ART BECAUSE IT SATISFIES ALL

THE FEATURES OF AN ART.
1) EXISTENCE OF THEORETICAL KNOWLEDGE-
A successful manager practices the art of mgt. in the day-
to-day job of managing an enterprise based on study,
observation & experience.
1) BASED ON CONTINUOUS PRACTICE-
Management satisfies this criteria as a manager gains
experience through regular practice & becomes more
effective.
Henry Fayol’s Contribution to
Management
Henry Fayol’s Contribution to
Management # Introduction to Fayol
and His Work:
Henry Fayol (1841 -1925) was a French mining
engineer who turned a leading industrialist and a
successful manager.
He was a mining engineer in a French mining company
and rose to the position of the Chief Managing Director.
His life-long experience, in the field of managing, was
reproduced in a monograph titled ‘Administration
Industrial and General’. Fayol’s work gained popularity
and was made known to scholars and practitioners of
management; only when his monograph was published
in English in the U.S.A. in 1949.
 (a) Fayol’s classification of
business functions:
(i) Technical activities (relating to production)
(ii) Commercial activities (relating to buying, selling or
exchange).
(iii) Financial activities (relating to search for and optimum
use of capital i.e. finances)
(iv) Security activities (relating to protection of the
properties and personnel of the enterprise)
(v) Accounting activities (relating to a systematic recording
of business transactions, including statistics also).
(vi) Managerial activities
(b) Fayol’s classification of
managerial functions:

1. Planning
2. Organizing
3. Commanding
4. Coordinating
5. Controlling
 (c) Qualities required in
managers:
1. Physical
2. Mental
3. Moral
4. Education
5. Technical
6. Experience
 (d) General principles of
management:
By far, the most significant contribution by Fayol is the
general principles of management listed by him, in his
monograph titled ‘General and Industrial Administration.
Based on his long managerial experience, Fayol advocates
fourteen general principles of management.
(1) Division of work:
Division of work leading to specialization results in
increased human efficiency; as through the application
of this principle, much more production is possible with
the same amount of human efforts. Fayol recommends
the application of this principle at both the levels in an
organisation operational and managerial.

(2) Authority and responsibility:

Authority, in management, is the key to a managerial job.
It is the power inherent in a managerial position which
enables a manager to command subordinates to work
towards the attainment of enterprise objectives.
Responsibility, is the reverse of authority; whose
essence is an obligation owed by a subordinate to the
superior.
(3) Discipline:
Discipline, in simple terms, means obedience to the
rules of the organisation, on the part of both-managers
and subordinates – including outward marks of respect
shown by subordinates towards superiors. Discipline is
necessary in an organisation; if the organisation is to
function properly and prosper and grow.

(4) Unity of command:

Unity of command, is perhaps, one of the most useful
and significant principles of management advised by
Fayol. According to this principle, a subordinate must get
orders and instructions, only from one superior at a time.
(5) Unity of Direction:
To avoid confusion of this principle from the preceding
one viz., the unity of command, unity of direction might
be given a new nomenclature i.e. ‘similarity of guidance’.
Unity of direction (or similarity of guidance) implies that
for each group of activities having the same objective,
there must be ‘one head and one plan’; or similar
activities must be guided in similar ways.
For example, if in an industrial enterprise, there are
10,000 workers; then there must be only one overall
production plan and only one overall Production In-
charge, imparting similar instructions to all workers of
course, through their respective foremen (or production
superintendents).
(6) Subordination of individual to general
interest:
According to this principle the interest of an individual
must be given less importance than interest of an
organization.

(7) Remuneration of personnel:

Remuneration of personnel is the price paid or payable
to people – managers and workers – for their services
rendered towards the attainment of the enterprise
objectives. Since the question of remuneration is of vital
importance for a smooth functioning of organizational
life, making for good or bad industrial relations;
(8) The degree of centralization
According to this principle there must be a proper
balance between centralization and decentralization in
the organization.

(9) Equity:
The concept of ‘equity’ implies a sense of ‘fairness and
justice’ to all working in an enterprise. Observance of
equity, alone would make personnel loyal and devoted to
the organisation.
(10) Scalar chain:
Scalar chain might be defined as the chain of superiors
(i.e. managers) with grades of authority ranging from the
highest to the lowest.
The following simple figure illustrates the above
concept:

(11) Order:
The principle of ‘order’ implies a systematic arrangement of things
and personnel.
(12) Stability of tenure:
According to this principle at the time of recruitment of
employees, the management should assure them about
stability of tenure or job security.

(13) Initiative:
Initiative, refers to volunteering to do the work in an
innovative way.
(14) Esprit de corps (or union is strength):
Esprit de corps or union is strength is a simple common
proverb, which refers to the strength or power
associated with a group, when the members of the group
work whole-heartedly in full co-operation with one
another.
F. W. Taylor (1856-1915) was an American mechanical engineer
who sought to improve industrial efficiency. He was one of the
first management consultants. Taylor was one of the intellectual
leaders of the Efficiency Movement and his ideas, broadly
conceived, were highly influential in the Progressive Era(1890s–
1920s). Taylor summed up his efficiency techniques in his book
The Principles of Scientific Management.
Four Principles of Scientific
Management
1. Science, not the Rule of Thumb-
Replace working by "rule of thumb," or simple habit and
common sense, and instead use the scientific method to
study work and determine the most efficient way to
perform specific tasks.

2. Harmony, Not Discord-

Taylor indicated and believed that the relationship
between the workers and management should be cordial
and completely harmonious. Difference between the two
will never be beneficial to either side. Management and
workers should acknowledge and understand each
other’s importance
3. Mental Revolution-
This technique involves a shift of attitude of
management and workers towards each other. Both
should understand the value of each other and work with
full participation and cooperation. The aim of both should
be to improve and boost the profits of the organisation.
Mental Revolution demands a complete change in the
outlook of both the workers and management; both
should have a sense of togetherness.
4. Cooperation, not Individualism-
It is similar to ‘Harmony, not discord’ and believes in
mutual collaboration between workers and the
management. Managers and workers should have
mutual cooperation and confidence and a sense of
goodwill.
KEY POINTS
To learn more about the current tools and practices of
effective team management, visit our Team
Management section.
 MAX WEBER
A bureaucratic theory introduced by Max Weber includes two
essential elements, including structuring an organization into
a hierarchy and having a clearly defined role to help
administer an organization and its members. A German
Sociologist, Max Weber, described a theory to operate an
organization effectively which is known as the Bureaucratic
management approach or Weberian Bureaucracy. Read the
article below to know more about the Max Weber
Bureaucracy Theory.
What do You mean by Bureaucracy?
"Bureaucracy is an organizational structure
characterized by many laws, standardized procedures,
procedures and requirements, number of desks, the
meticulous division of labour and responsibility, clear
hierarchies and professional interactions between
employees that are almost impersonal."- Max Weber.
The Concept of Max Weber Bureaucracy
Theory
A German scientist, Max Weber, describes bureaucracy
as an institution that is highly organized, formalized, and
also impersonal. He also developed the belief that there
must be a fixed hierarchical structure for an organization
and clear rules, regulations, and lines of authority that
regulate it.
•Specialization of labour
•A formal set of rules and regulations
•Well-defined hierarchy within the organization
•Impersonality in the application of rules
Max Weber’s Bureaucratic Form – 6 Major Principles

A Structured Hierarchical Structure: In a

bureaucratic organization, each level governs the level
below it. Also, the level below it governs it. The
foundation of central planning and centralized decision
making is a formal hierarchy.

Rules-Based Management- To exercise control,

the company uses rules. Therefore at higher levels, the
lower levels effortlessly execute the decisions made.
Organization of Functional Specialties -
Specialists do the job. The company often breaks
workers into groups depending on the type of work they
do or the abilities they possess.
Impersonal - All workers are handled fairly by
hierarchical organizations. They also fairly treat all
clients and do not allow individual differences to affect
them.

Employment-oriented Professional Qualifications -

Selection is based on technical qualifications and skills
as well as employee promotion.