UNIT-1

INTRODUCTION TO MANAGEMENT AND ORGANISATION

1. Concepts of management

Management
A universal concept that is needed in every organisation whether it is a business organisation or a non-
business organisation such as hospital school, etc., is known as management.
Traditional definitions of management
“management consists of getting things done through others. A manager is one who accomplishes
objectives by directing efforts of others.” – c.s. george
“management is the art of getting things done through others.” – follett
Modern concept of management
Management is a process through which an organisation designs and maintains an environment in which
individuals work together with the motive of achieving organisational goals effectively and efficiently.

Three essential elements that come under the modern concept of management are as follows:

1. Management is a ‘process’: management involves a series of int-related functions like planning,

organising, staffing, directing, and controlling, which makes it a process. Every manager performs these
functions to achieve goals.
2. Management requires effective performance: effectiveness in management means achieving
goals on time. In simple terms, it aims at end result. For example, if an organisation achieves its sales
target within time, it is said to be effective.
3. Management needs efficiency: efficiency in management means doing tasks correctly and with
minimum cost. It is not enough to just complete the task on time, it should be accurate also. Besides,
management also aims at using its resources efficiently as it reduces the cost of the firm ultimately
resulting in higher profits.
Characteristics of management
1. Continuous process: management is a continuous process. It means that the process of business
management goes on until the company exists, as it helps in achieving the organisational goals.
2. Goal-oriented: every organisation has a set of predetermined goals or objectives that it aims to
accomplish during its existence. Every organisation has different goals.
3. All pervasive: the process of business management is universal in nature. Every organisation, whether
small scale, large scale, economic, social, etc., uses the process of management at every level or stage.
Besides, the activities involved in the management of an organisation are common for all whether it is a
social, political, or economic enterprise.
4. Multidimensional: management is a multidimensional process as it does not involve only one activity.
Management of work: every organisation is set up to perform some work or goal, and the management
aims at achieving these goals or tasks. The work of an organisation depends upon the nature of
business; for example, work to be fulfilled in a hospital is treating patients, in a university is educating
students, etc.
 Management of people: people are the most essential assets of an organisation and refer to human
resources.
 Management of operations: operations are the activities of an organisation’s production cycle, like
purchasing inputs, converting them into semi-finished goods, and finished goods.

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 5. Dynamic function: there are different internal and external factors that affect the working of an
organisation. An organisation has to change and adapt itself on the basis of changing environment to
accomplish the organisational goals and objectives. Hence, management is a dynamic function.
6. Management is a group activity: management involves a group of people performing managerial
activities.
7. Management is an intangible force: management is a function that cannot be physically seen but its
presence can be felt by watching the orderliness and coordination in work environment and happy faces of
the employees when the task is completed.

Objectives of management
1. Social objectives: these refer to the objectives which are desired to be achieved for the benefit of
society.
2. Organisational objectives: with the help of management, every organisation sets and achieves
organisational goals. The three major organisational objectives are survival, profit, and growth.
 Survival: one of the basic objectives of every organisation is survival. It does so by making positive
decisions for the organisation with the help of the business management process.
 Profit: survival is not enough for an organisation; it has to earn profits to grow and expand in the
future. Hence, every organisation has to ensure its profit so that it can cover its costs and risks.
 Growth: besides earning a profit, an organisation has to grow in order to remain in the industry. For
this purpose, the management of an organisation has to exploit its resources effectively and efficiently.
3. Personal or individual objectives: as discussed earlier, people are the main asset of an organisation
having different goals, backgrounds and personalities.
Importance of management
1. Increases efficiency: the management process of an organisation increases its efficiency by reducing
cost and increasing productivity by utilisation of the available resources in the best possible and optimum
way.
2. Helps in achieving group goals: effective management process creates teamwork and builds
coordination among the members of an organisation.
3. Creates a dynamic organisation: every organisation works in a changing environment. The managers
of an organisation have to help their members adapt to the changing environment, which ultimately helps
them ensure the survival and growth of the organisation.
4. Development of society: every organisation has various objectives toward different groups of society.
5. Helps in achieving personal objectives: every individual or employee of an organisation has different
objectives or goals they wish to accomplish while doing their jobs.

Levels of management – top, middle and lower

The chain of superior-subordinate relationships is known as the levels of management. The three levels
of management are top level management, middle-level management, and operational level management.

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Three levels of management
1. Top level management
The senior most executives of the organization are found at the top level of management. The top level of
an organization’s management consists of the board of directors, managing director, chairman, chief
executive officer, chief operating officer, vice-president, president, general manager, and other senior
executives.
2. Middle level management
The next level of management is the middle level, which serves as a link between the top level
management and the lower level management. The middle level management is superior to the lower or
operational level management and subordinate to the top level management. The middle level of an
organization’s management consists of different functional department heads, such as departmental
managers including production, purchase, finance, personnel, marketing managers, and other executive
officers for different departments such as plant superintendent, etc. The employees or members of the
middle level management are responsible to the top level management for their performance.
3. Lower level management
The last level of management is the lower level management and is also known as the supervisory or
operational level management. The managers at the lower level of management play a crucial role in the
proper management of an organization, as they directly interact with the actual work force and interpret
the instructions of the middle level managers to them. The responsibility and authority of the lower level
managers depend upon the plans and policies formed by the top level management. The lower level
management consists of foremen, supervisors, section officers, superintendents, and other managers who
have direct control over the operative employees of the organization.

Functions of management:

I.e. planning, organizing, staffing, directing and controlling.

For theoretical purposes, it may be convenient to separate the function of management but practically
these functions are overlapping in nature i.e. they are highly inseparable. Each function blends into
the other & each affects the performance of others.

planning

It is the basic function of management. It deals with chalking out a future course of action & deciding in
advance the most appropriate course of actions for achievement of pre- determined goals. According to
koontz, “planning is deciding in advance - what to do, when to do & how to do. It bridges the gap from
where we are & where we want to be”. A plan is a future course of actions. It is an exercise in problem
solving & decision making. Planning is determination of courses of action to achieve desired goals.
Thus, planning is a systematic thinking about ways & means for accomplishment of pre- determined
goals. Planning i s necessary to ensure proper utilization of human & non- human resources. It is all
pervasive, it is an intellectual activity and it also helps in avoiding confusion, uncertainties, risks,
wastages etc.

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organizing
It is the process of bringing together physical, financial and human resources and developing productive
relationship amongst them for achievement of organizational goals. According to henry fayol, “to
organize a business is to provide it with everything useful or its functioning i.e. raw material, tools,
capital and personnel’s”. To organize a business involves determining & providing human and non-
human resources to the organizational structure. Organizing as a process involves:

 Identification of activities.
 Classification of grouping of activities.
 Assignment of duties.
 Delegation of authority and creation of responsibility.
 Coordinating authority and responsibility relationships.

staffing
It is the function of manning the organization structure and keeping it manned. Staffing has assumed
greater importance in the recent years due to advancement of technology, increase in size of business,
complexity of human behavior etc. The main purpose o staffing is to put right man on right job i.e.
square pegs in square holes and round pegs in round holes. According to kootz & o’donell, “managerial
function of staffing involves manning the organization structure through proper and effective selection,
appraisal & development of personnel to fill the roles designed un the structure”. Staffing involves:

 manpower planning (estimating man power in terms of searching, choose the person and
giving the right place).
 Recruitment, selection & placement.
 training & development.
 remuneration.
 performance appraisal.
 Promotions & transfer.

directing
It is that part of managerial function which actuates the organizational methods to work efficiently for
achievement of organizational purposes. It is considered life-spark of the enterprise which sets it in
motion the action of people because planning, organizing and staffing are the mere preparations for
doing the work. Direction is that inert-personnel aspect of management which deals directly with
influencing, guiding, supervising, motivating sub-ordinate for the achievement of organizational goals.
Direction has following elements:

 Supervision
 motivation
 leadership
 communication

Supervision- implies overseeing the work of subordinates by their superiors. It is the act of watching &
directing work & workers.
Motivation- means inspiring, stimulating or encouraging the sub-ordinates with zeal to work. Positive,
negative, monetary, non-monetary incentives may be used for this purpose.
Leadership- may be defined as a process by which manager guides and influences the work of
subordinates in desired direction.
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Communications- is the process of passing information, experience, opinion etc from one person to
another. It is a bridge of understanding.
controlling
It implies measurement of accomplishment against the standards and correction of deviation if any to
ensure achievement of organizational goals. The purpose of controlling is to ensure that everything
occurs in conformities with the standards. An efficient system of control helps to predict deviations
before they actually occur. According to theo haimann, “controlling is the process of checking whether
or not proper progress is being made towards the objectives and goals and acting if necessary, to correct
any deviation”. According to koontz & o’donell “controlling is the measurement & correction of
performance activities of subordinates in order to make sure that the enterprise objectives and plans
desired to obtain them as being accomplished”. Therefore controlling has following steps:

 Establishment of standard performance.

 Measurement of actual performance.
 Comparison of actual performance with the standards and finding out deviation if any.
 Corrective action.

2. Evolution of management thought

The practice of management is as old as human civilization. The ancient civilizations of egypt (the
great pyramids), greece (leadership and war tactics of alexander the great) and rome displayed the
marvelous results of good management practices.

2.1. Taylor's scientific management

Frederick winslow taylor well-known as the founder of scientific management was the first to
recognize and emphasis the need for adopting a scientific approach to the task of managing an
enterprise. He tried to diagnose the causes of low efficiency in industry and came to the conclusion
that much of waste and inefficiency is due to the lack of order and system in the methods of
management. He found that the management was usually ignorant of the amount of work that could
be done by a worker in a day as also the best method of doing the job. As a result, it remained
largely at the mercy of the workers who deliberately shirked work. He therefore, suggested that those
responsible for management should adopt a scientific approach in their work, and make use of
"scientific method" for achieving higher efficiency. The scientific method consists essentially of

 Observation
 Measurement
 Experimentation
 Inference.
Taylor's principles of scientific management
Introduction
In an organization for work to proceed smoothly, it is needed that there is harmony and trust between the
workers and the managers. But this is not possible if they do not communicate well and understand what
the needs of each other are. It can hence also be said that scientific management is an attitude and a
philosophy that disregards the traditional hit and miss type of working method.
Scientific management

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Typically, scientific management can be considered as the art of delegation or as fredrick winslow taylor
stated: “scientific management means knowing exactly what you want men to do and seeing that they do it
in the best and the cheapest way.”

Taylor’s principles of scientific management

The following are f.w taylor’s fundamental principles of scientific management -
1. To replace the ‘rule of thumb’ in work with the scientific method to analyze work and determine
the best way to perform them efficiently.
2. To delegate work based on workers’ capability and motivation. Additionally, to provide them with
the required training to maximize their work efficiency.
3. Allocation of work to both manager and workers, wherein, the managers would be entrusted with
planning work schedules and training workers.
4. Assessment and supervision of workers’ performance. Also, providing them with suitable
instructions to maximize their performance.

in a broad sense, the techniques of scientific management are as follows.

1. Functional foremanship
2. Standardization of work
3. Simplification of work
4. Work-study
5. Differential piece of wage rates
6. Mental revolution

What is functional foremanship?

Functional foremanship is essentially an administration system that is somewhat based on the principle –
‘division of labor’, to establish specialization in an organizational setup. Typically, in a functional
organization, the available work is divided into different parts and are delegated to workers who are
somewhat specialized in them.

In a broad sense, an organization is divided into two sub-departments with four experts in each
department –
i. Planning department
ii. Production department

In a functional organizational setup, the planning department is headed by a planning manager.

Other workers and their functions are as follows –
Planning department

1. Route clerk- this person is in charge of deciding a day’s work and is also responsible for ensuring
the work sequence is maintained and completed properly.
2. Instruction clerk- the instruction clerk is accountable for preparing instruction cards containing
information about the kind of work, procedures to apply and equipment and raw materials to be
used. Subsequently, the data compiled is handed to a gang boss.
3. Time and cost clerk- this clerk is mostly responsible for deciding the entire time frame of the
designated work. Also, the cost of producing a product is decided by them.
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 4. Discipline officer- this officer ensures that delegated tasks are performed in a disciplined manner.
production department and their functions –
1. Gang boss- he/she serves as the leader of a gang of workers. A gang boss is mostly responsible for
ensuring that equipment and workers are suitable for producing the required units of products.
Also, it is under his supervision to check if raw materials have been made available to workers.
2. Speed boss- his/her primary task is to make sure that workers are on par with the work schedule.
The speed boss is also responsible for identifying the reasons that tend to slow down work
productivity and formulating suitable solutions to remedy them.
3. Repair boss- he/she is responsible for keeping all equipment in good working condition and
solves problems about that promptly.
4. Inspector- an inspector checks the quality of goods produced and compares them with the
standard quality. Also, an inspector has the power to initiate corrective measures if there is a lag in
quality.

Standardization and simplification of work

Standardization and simplification of work can be looked at as a means to establish efficiency standards
for every activity in an industrial setup. Elements like time, production manner, machinery, raw material,
product and its processing can be standardized under this method. For instance, the number of products
that need to be produced on a single day or the work that is expected from a worker.

Standardization and simplification of work –

1. Standardization of work
 Standardization of raw material- it means that the materials used should be on par with the
quality of finished products one intends to manufacture. For instance, to produce aa+ quality of
apparel 5+ quality of textile would be required.
 Standardization of equipment- similarly, standardization of machines would ensure that manual
errors are reduced significantly. In turn, it would ensure the completion of work faster and with
negligible errors.
 Standardization of methods applied- standardizing the techniques of work would make the
production process less cumbersome and relatively quick. Notably, methods devised to complete a
particular work are put to use every time similar work is performed.
 Standardization of working conditions- workers tend to perform more efficiently under
favorable working conditions. When the working conditions, including safety, ventilation, hygiene,
temperature, lighting, etc. Are improved or standardized, it enhances productivity significantly.

2. Simplification of work
The primary objective behind simplification is to eliminate things, methods and practices that make the
work complex and cumbersome.

Study of work
One of the techniques of scientific management – the study of work is mostly concerned with the analysis
of organizational activities to produce high products cost-effectively.
Typically, scientific techniques of taylor about the study of work can further be divided into four types –
1. Method study- it tends to help producers to pick the most suitable method to finish a particular
organizational activity. For instance, this study helps to figure out the most cost-effective way of

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 procuring the required raw materials for production. Also, the objective of this study is to lower
the cost of production and to increase customer satisfaction.
2. Motion study- it is concerned with the analysis of movements of both workers and machines
through the course of a production. It helps to analyze if adding or subtracting an activity would
make the work faster and better in terms of quality or not.
3. Time study - it helps to compute the standard time that would be required to finish a specific
activity. In simple words it can be said, the major objective of this study is to estimate
 Cost of labor
 Number of workers required for a task
 Suitable incentive plan
4. Fatigue study- it helps to find out the acceptable rest intervals that can be given to prevent the
onset of mental fatigue among workers. However, the prospect of completing work on time is also
the main priority of this study.

Piece of the wage system

It is one of the techniques of scientific management that encourages the application of a piece wage
system as a means to motivate employees. As per this system, payment is based on the amount of work
done and not the time spent to complete it.

Mental revolution
Mental revolution is one of the techniques of scientific management that demands a change in employers’
and employees’ mindsets. As per this management technique, a positive mindset is quite crucial for
promoting the feeling of cooperation and boosting proficiency. In its absence, conflicts about the division
of labor and delegation of responsibility are bound to arise in an organization.

2.2 HENRY FAYOL'S 14 PRINCIPLES OF MANAGEMENT

The principles of management are given below:

1. Division of work: division of work or specialization alone can give maximum productivity
and efficiency. Both technical and managerial activities can be performed in the best manner
only through division of labour and specialization.

2. Authority and responsibility: the right to give order is called authority. The obligation to
accomplish is called responsibility. Authority and responsibility are the two sides of the
management coin. They exist together. They are complementary and mutually interdependent.

3. Discipline: the objectives, rules and regulations, the policies and procedures must be honoured
by each member of an organization. There must be clear and fair agreement on the rules and
objectives, on the policies and procedures. There must be penalties (punishment) for non-
obedience or indiscipline. No organization can work smoothly without discipline - preferably
voluntary discipline.
4. Unity of command: in order to avoid any possible confusion and conflict, each member of an
organization must received orders and instructions only from one superior (boss).
5. Unity of direction: all members of an organization must work together to accomplish common
objectives.

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6. Emphasis on subordination of personal interest to general or common interest: this is
also called principle of co-operation. Each shall work for all and all for each. General or common
interest must be supreme in any joint enterprise.

7. Remuneration: fair pay with non-financial rewards can act as the best incentive or
motivator for good performance. Exploitation of employees in any manner must be eliminated.
Sound scheme of remuneration includes adequate financial and nonfinancial incentives.

8. Centralization: there must be a good balance between centralization and decentralization of

authority and power. Extreme centralization and decentralization must be avoided.

9. Scalar chain: the unity of command brings about a chain or hierarchy of command linking all
members of the organization from the top to the bottom. Scalar denotes steps.

10. Order: fayol suggested that there is a place for everything. Order or system alone can create a
sound organization and efficient management.

11. Equity: an organization consists of a group of people involved in joint effort. Hence, equity
(i.e., justice) must be there. Without equity, we cannot have sustained and adequate joint
collaboration.

12. Stability of tenure: a person needs time to adjust himself with the new work and demonstrate
efficiency in due course. Hence, employees and managers must have job security. Security of
income and employment is a pre-requisite of sound organization and management.

13. Initiative: creative thinking and capacity to take initiative can give us sound managerial
planning and execution of predetermined plans.

14. Espirit de corps: this means team work; implying that there is unity in strength.

2.3 THEORY X AND THEORY Y

J DOUGLAS MCGREGOR presented two sets of assumptions managers make about the nature of
their employees; these sets are named as

Under theory x, it is assumed that

1. Employees are inherently lazy.
2. They require constant guidance and support
3. Sometimes they require even coercion and control
4. Given an opportunity, they would like to avoid 'responsibility
5. They do not show up any ambition but always seek security
O explain theory x, mcgregor elaborated taylor's observations about workers using the rule of thumb
approach.

Theory y focuses a totally different set of assumptions about the employees. Theory y states
that
1. Some employees consider work as natural as play or rest
2. These employees are capable of directing and controlling performance on their own.
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 3. They are much committed to the objectives of the organisation
4. Higher rewards make these employees more committed to organisation
5. Given an opportunity, they not only accept responsibility but also look for opportunities to
outer form others
6. Most of them are highly imaginative, creative, and display ingenuity in handling organisational
issues

2.4 HERZBERG’S TWO-FACTOR THEORY OF MOTIVATION

What is two-factor theory?

The two-factor motivation theory, otherwise known as herzberg’s motivation-hygiene theory or dual-
factor theory, argues that there are separate sets of mutually exclusive factors in the workplace that either
cause job satisfaction or dissatisfaction (herzberg, 1966; 1982; 1991; herzberg, mausner, & snyderman,
1959).

Generally, these factors encourage job satisfaction and relate to self-growth and self-actualization.
The two-factor motivation theory has become one of the most commonly used theoretical frameworks in
job satisfaction research (dion, 2006).
To herzberg, motivators ensured job satisfaction, while a lack of hygiene factors spawned job
dissatisfaction.
To herzberg, motivators ensured job satisfaction, while a lack of hygiene factors spawned job
dissatisfaction.

Frederick herzberg’s approach

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 Motivation factors

Herzberg et al. (1959) argue that motivation factors are necessary to improve job satisfaction.

According to herzberg, these motivators are intrinsic to the job and lead to job satisfaction because they
satisfy the needs for growth and self-actualization (herzberg, 1966).

1. Advancement: herzberg defined advancement as the upward and positive status or position of someone
in a workplace.
Meanwhile, a negative or neutral status at work represents negative advancement (alshmemri et al.,
2017, 2017).
2. The work itself: the content of job tasks can positively or negatively affect employees.
The job’s difficulty and level of engagement can dramatically impact satisfaction or dissatisfaction in
the workplace (alshmemri et al., 2017, 2017).
3. Possibility for growth: possibilities for growth exist in the same vein as maslow’s self-actualization;
they are opportunities for a person to experience personal growth and promotion in the workplace.
Personal growth can result in professional growth, increased opportunities to develop new skills and
techniques, and gaining professional knowledge (alshmemri et al., 2017, 2017).
4. Responsibility: responsibility encompasses both the responsibilities held by the individual and the
authority granted to the individual in their role.
People gain satisfaction from being given the responsibility and authority to make decisions.
Conversely, a mismatch between responsibility and level of authority negatively affects job satisfaction
(alshmemri et al., 2017, 2017).
5. Recognition: when employees receive praise or rewards for reaching goals or producing high-quality
work, they receive recognition.
Negative recognition involves criticism or blame for a poorly done job (alshmemri et al., 2017, 2017).
6. Achievement: positive achievement can involve, for example, completing a difficult task on time,
solving a job-related problem, or seeing positive results from one’s work.
Negative achievement includes failure to progress at work or poor job-related decision-making
(alshmemri et al., 2017, 2017).

Herzberg’s hygiene factors

Hygiene factors are those which decrease job dissatisfaction. Herzberg, mausner, and snyderman used the
term hygiene as “medical hygiene…[which] operates to remove health hazards from the environment”
(1959; alshmemri et al., 2017).

Herzberg also states that hygiene factors are extrinsic to the job and function in “the need to avoid
unpleasantness” (herzberg, 1966).

Hygiene factors, rather than relating to the content of the job in itself, tend to relate to contextual factors
such as interpersonal relations, salary, company policies, and administration, relationship with
supervisors, and working conditions:
1. Interpersonal relations: interpersonal relationships involve the personal and working relationships
between an employee and his supervisors, subordinates, and peers.
This can manifest in, for example, job-related interactions as well as social discussions in both the work
environment and during informal break times.

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2. Salary: salary includes wage or salary increases and negative unfulfilled expectations of wage or salary
increases (alshmemri et al., 2017).
3. Company policies and administration: company policies and administration include factors such as
the extent to which company organization and management policies and guidelines are clear or unclear.
For example, a lack of delegation of authority, vague policies and procedures, and communication may
lead to job dissatisfaction (alshmemri et al., 2017).
4. Supervision: supervision involves an employee’s judgments of the competence or incompetence and
fairness or unfairness of the supervisor or supervision.
For example, this could include a supervisor’s willingness to delegate responsibility or teach and their
knowledge of the job.
Poor leadership and management can decrease job dissatisfaction (alshmemri et al., 2017).
5. Working conditions: finally, working conditions involve the physical surroundings of the job and
whether or not they are good or poor.

2.5 MASLOW’S HIERARCHY OF NEEDS THEORY

1. Physiological needs- these are the basic needs of air, water, food, clothing and shelter. In
other words, physiological needs are the needs for basic amenities of life.
2. Safety needs- safety needs include physical, environmental and emotional safety and
protection. For instance- job security, financial security, protection from animals, family
security, health security, etc.
3. Social needs- social needs include the need for love, affection, care, belongingness, and
friendship.
4. Esteem needs- esteem needs are of two types: internal esteem needs (self- respect,
confidence, competence, achievement and freedom) and external esteem needs (recognition,
power, status, attention and admiration).
5. Self-actualization need- this include the urge to become what you are capable of becoming /
what you have the potential to become. It includes the need for growth and self-contentment.
It also includes desire for gaining more knowledge, social- service, creativity and being
aesthetic. The self- actualization needs are never fully satiable. As an individual grows
psychologically, opportunities keep cropping up to continue growing.

2.6 HAWTHORNE EXPERIMENTS

Hawthorne studies in management refer to the modification of employee behavior based on the perception
that they are being observed by management. Hawthorne studies are recognized for exploring the socio-
psychological factors of human behavior as a strategy for managing employees in the workplace.
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 Elton mayo’s hawthorne experiment and it’s contributions to management

The term “hawthorne” is a term used within several behavioral management theories and is originally
derived from the western electric company’s large factory complex named hawthorne works. Starting in
1905 and operating until 1983, hawthorne works had 45,000 employees and it produced a wide variety of
consumer products, including telephone equipment, refrigerators and electric fans. As a result, hawthorne
works is well-known for its enormous output of telephone equipment and most importantly for its
industrial experiments and studies carried out.

Hawthorne experiment by elton mayo

In 1927, a group of researchers led by elton mayo and fritz roethlisberger of the harvard business school
were invited to join in the studies at the hawthorne works of western electric company, chicago. The
experiment lasted up to 1932. The hawthorne experiment brought out that the productivity of the
employees is not the function of only physical conditions of work and money wages paid to
them. Productivity of employees depends heavily upon the satisfaction of the employees in their work
situation. Mayo’s idea was that logical factors were far less important than emotional factors in
determining productivity efficiency. Furthermore, of all the human factors influencing employee behavior,
the most powerful were those emanating from the worker’s participation in social groups. Thus, mayo
concluded that work arrangements in addition to meeting the objective requirements of production must at
the same time satisfy the employee’s subjective requirement of social satisfaction at his work place.

Elton mayo
hawthorne experiment consists of four parts. These parts are briefly described below:-

1. Illumination experiment.
2. Relay assembly test room experiment.
3. Interviewing programme.
4. Bank wiring test room experiment.

1. Illumination experiment:
This experiment was conducted to establish relationship between output and illumination. When the
intensity of light was increased, the output also increased. The output showed an upward trend even when
the illumination was gradually brought down to the normal level. Therefore, it was concluded that there is
no consistent relationship between output of workers and illumination in the factory. There must be some
other factor which affected productivity.
2. Relay assembly test room experiment:
This phase aimed at knowing not only the impact of illumination on production but also other factors like
length of the working day, rest hours, and other physical conditions. In this experiment, a small
homogeneous work-group of six girls was constituted. These girls were friendly to each other and were
asked to work in a very informal atmosphere under the supervision of a researcher. Productivity and
morale increased considerably during the period of the experiment. Productivity went on increasing and
stabilized at a high level even when all the improvements were taken away and the pre-test conditions
were reintroduced. The researchers concluded that socio-psychological factors such as feeling of being
important, recognition, attention, participation, cohesive work-group, and non-directive supervision held
the key for higher productivity.
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3. Mass interview programme:
The objective of this programme was to make a systematic study of the employees attitudes which would
reveal the meaning which their “working situation” has for them. The researchers interviewed a large
number of workers with regard to their opinions on work, working conditions and supervision. Initially, a
direct approach was used whereby interviews asked questions considered important by managers and
researchers. The researchers observed that the replies of the workmen were guarded. Therefore, this
approach was replaced by an indirect technique, where the interviewer simply listened to what the
workmen had to say. The findings confirmed the importance of social factors at work in the total work
environment.
4. Bank wiring test room experiment:
This experiment was conducted by roethlisberger and dickson with a view to develop a new method of
observation and obtaining more exact information about social groups within a company and also finding
out the causes which restrict output. The experiment was conducted to study a group of workers under
conditions which were as close as possible to normal. This group comprised of 14 workers. After the
experiment, the production records of this group were compared with their earlier production records. It
was observed that the group evolved its own production norms for each individual worker, which was
made lower than those set by the management. Because of this, workers would produce only that much,
thereby defeating the incentive system. Those workers who tried to produce more than the group norms
were isolated, harassed or punished by the group. The findings of the study are:-
 Each individual was restricting output.
 The group had its own “unofficial” standards of performance.
 Individual output remained fairly constant over a period of time.
 Informal groups play an important role in the working of an organization.

3. MORALE
Understanding 'morale' is essential in any group or organizational context. Morale refers to the collective
attitude, overall satisfaction, and emotional outlook of a group, be it a team, community, or an entire
organization. It includes factors such as collective spirit, enthusiasm, and the level of dedication members
feel towards their group's goals or objectives. High morale in any group is usually marked by optimism, a
strong sense of purpose, and a positive environment. In contrast, low morale can result in disengagement
and lower effectiveness. Recognizing and enhancing morale is key to fostering a productive and
harmonious environment, whether in sports, community projects, or business teams.

Employee morale
employee morale is specifically concerned with the morale within a workplace. It is defined as the overall
satisfaction, attitude, and outlook of employees during their tenure with an organization. This concept
plays a crucial role in various aspects of business dynamics, including workplace culture, employee
engagement, and the overall employee experience. High employee morale is typically characterized by job
satisfaction, strong team cohesion, and a positive attitude towards the organization and its objectives.
Conversely, low employee morale can lead to reduced workplace productivity and higher employee
turnover. Understanding and improving employee morale is thus a strategic imperative for leaders aiming
to achieve optimal organizational performance and employee well-being.

Importance of employee morale

Understanding why and how to boost morale in the workplace is vital for any successful business
strategy. Employee morale is directly correlated to your organization’s overall productivity,
competitiveness in the market, and, in turn, your profitability. Understanding and improving employee

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morale is not just an aspect of good leadership; it's a strategic initiative that can lead to significant
business gains. In the following sections, we're going to dive deeper into how boosting morale can
enhance productivity, elevate competitiveness, and ultimately drive profitability.

 Morale and productivity

While employee morale impacts individual productivity, team morale is equally crucial as it boosts morale
and enhances collaboration and efficiency in team projects and goals.

Employees with a higher level of employee morale tend to be more productive, more satisfied with their
jobs, and more engaged at work. This can give you a significant advantage because happy and fulfilled
people at work tend to stay in place (low employee turnover), tend to go to bat for your brand (employee-
led brand recognition), and tend to boost customer satisfaction ratings.

 Enhancing market competitiveness

Morale also plays a crucial role in boosting an organization's market competitiveness. When employees
are satisfied, it positively impacts their performance, which can set a company apart from its competitors.
Similarly, improved customer service naturally follows high morale, contributing to a strong market
reputation.

 The profitability factor

Lastly, employee morale and profitability are directly linked. High morale can lead to lower turnover
rates, which in turn reduces costs associated with hiring and training new employees. Simultaneously,
increased productivity and better customer service can drive higher sales, directly impacting the bottom
line.

Factors affecting employee morale

So, what factors affect employee morale? Because employee morale is something that people feel – both
individually and collectively – here are five factors that can influence it:

1. Leadership
Effective leadership doesn't just shape the work environment; it's a key component to boost employee
morale and elevating team morale by fostering a sense of unity and purpose among team members.

2. Communication
Effective two-way communication is vital for maintaining morale. Employees feel empowered when their
voices are heard and acknowledged.

3. Reward & recognition

Recognition can make employees feel more connected, engaged, and productive. It makes them feel
valued and eager to continue performing well.

4. Work-life integration
Encouraging a healthy balance between work and home life is another crucial part of boosting employee
morale. Recognition can make employees feel more connected, engaged, and productive. It makes them
feel valued and eager to continue performing well. Employees who feel like their work is negatively
impacting their personal life quickly become despondent, dissatisfied, and disengaged with their work.

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5. The nature of work in relation to your organization
The kind of work employees do impacts their morale. Organizations must understand how the nature of
work influences employee morale and strive to make even mundane tasks satisfying.

The work that your employees do every single day is the soul of your organization. No matter your
industry or size, this work is the lifeblood of who you are as a company and, regardless of the employee’s
role, is how your organization collects revenue.

4. MOTIVATION

Motivation can be defined as the driving force behind your actions. It is often associated with ‘why’ you
want to do something. It is intertwined with your goals, feelings, dreams and hopes. Motivation at work
can drive the employees of an organisation to meet their individual goals as well as the company’s overall
goals.

Characteristics of motivation:

Motivation is the unifying force behind the actions of a person. Motivation decides the goal and provides
the power to chase the goal and the energy to work on the steps necessary to obtain the goal.

 Psychological concept: motivation comes from within an individual. It's driven by feelings and
needs that influence their behaviour. Think of it as a psychological push to act.
 Need-satisfying activity: for example, hunger is a basic need that motivates most people to cook,
earn, buy or borrow to be able to eat. In this context, a person cooking a meal is motivated by the
need to eliminate their hunger.
 Goal-directed behaviour: motivation is all about working towards something. It propels us to
take action in order to achieve a specific goal or desired outcome.
 Holistic approach: motivation considers the whole person, not just separate parts. Our various
needs and desires are interconnected and influence our behaviour.
 Multifaceted: motivation can be driven by both financial and non-financial factors. Financial
motivators include things like salary, bonuses or perks. Non-financial motivators could be praise,
recognition, feeling valued or having more responsibility.
 Ongoing process: motivation isn't a one-time thing. Our needs and goals can change, so what
motivates us today, might not motivate us tomorrow.

Types of employee motivation at the workplace

People are motivated by various factors. You can motivate employees with the promise of progression,
appreciation, financial benefits and so on. Some of the most common methods of motivating employees
are based on external factors like rewards, recognition and career growth.

All motivators fall within two categories: financial motivation and non-financial motivation.
Financial motivation
This type of motivation is anything that pushes an employee to give their all for the promise of financial
reward.
Non-financial motivation

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This type of motivation can be anything that motivates an employee through factors like personal goals,
recognition, desire to be famous, self-esteem, a luxurious life, career growth, stability or even a desire for
acceptance in society.
Motivation at work can be further classified as either intrinsic motivation or extrinsic motivation.
Intrinsic motivation: intrinsic motivation is driven by your internal emotions like joy, happiness,
determination or pride. These factors are present within you and not outside you.
Extrinsic motivation: extrinsic motivation is based on factors outside of the person. Some examples of
extrinsic motivation are deadlines, annual bonuses, prizes, appraisals or even negative aspects based on
external factors like law and order, punishment and societal rejection.

Factors impacting employee motivation at work

Motivation at the workplace is not an unattainable dream, as a manager you shouldn’t waste time thinking
of a plan to motivate your employees.

Top factors affecting employee motivation:

1. Employee treatment: when employees feel respected and valued, they are more likely to be
motivated.
2. Promise of career growth: when the workplace offers a positive scope for career growth,
employees are likely to be motivated to work.
3. Good leadership: high quality leaders help employees meet performance expectations and
develop a clear vision for their lives. This factor also increases motivation at work and helps teams
stick together for a long time.
4. Industry-standard salary and compensation benefits: another one of the main motivators at
work is when an employee receives a salary on par with the industry rate. This makes them feel
valued and respected. This is one of the primary motivation techniques used by most employee-
centric corporations.

Importance of motivation

Motivation is imperative for an organisation’s growth. Here are a few benefits of motivation in an
organisation:

 Increases productivity and proactivity: motivators, like promotions, create a drive for employees
to work to the best of their capabilities. As such, motivation in an organisation will lead to an
increase in the productivity of an employee, who will contribute more than a disheartened
employee.
 Ensures organisational efficiency: motivators can also help in changing the work culture of an
organisation. With bigger and better rewards to look forward to, employees will be more dedicated
to their work and more motivated to reach their targets. This can increase overall work efficiency
and the attitude of an entire organisation.
 Promotes loyalty among employees: motivating your employees to do their best and rewarding
their hard work can also be beneficial in igniting a sense of loyalty towards the company. A well-
motivated workforce is loyal and has higher levels of morale, being more committed to the
organisation and its goals. Ensuring your staff are motivated can also reduce employee turnover
and therefore the company costs of hiring new employees.

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  Facilitates direction: direction is an important aspect of any business. It involves the creation and
implementation of specific plans and strategies, contributing to the organisation’s main goals. A
motivated workforce will be enthusiastic about helping to develop and innovate the company.
They will also be more likely to suggest strategies or directions that can help the company expand
further.

Benefits of motivating employees at work

The main benefit of motivating employees lies in the results you can obtain. High motivation at work can
lead to a rise in performance, resulting in a win-win situation for your business and employees.

Here are some of the top benefits of motivated employees at work:

1. A highly motivated employee is 59% less likely to burn out during work
2. Highly motivated teams can increase business profitability by a whopping 21%
3. Did you know that proper motivation at work can increase employee retention?
4. Absenteeism is reduced in highly motivated teams by 41%
5. Feeling motivated at the workplace ensures that employees are 17% less likely to resign from their
roles
6. Companies that invest in motivating employees see a 50% rise in customer loyalty, a 38% rise in
productivity and a 27% increase in overall profits.

5. WORK ENVIRONMENT

A work environment is the setting, social features and physical conditions in which you perform your job.
These elements can impact feelings of well-being, workplace relationships, collaboration, efficiency and
employee health. Here are the significant aspects of a work environment:
Elements of a work environment
Use the following descriptions of each work environment element to identify a positive and productive
workplace:
Physical environment
The physical conditions you work under will play a crucial role in enabling you to reach your full
potential. Some critical aspects of your physical environment to consider include:
Size
The size of your working area can have an impact on whether you have everything at hand to accomplish
your job, while at the same time significantly influencing how you feel at work. To evaluate the size of
your workspace, consider the amount of space you have to move freely, whether you have all the
equipment you need nearby and if the area is large enough to accommodate all staff members.
Layout
Some indoor workplaces have an open floor plan, while others use cubicles or other dividers to separate
spaces. The design of a workplace may depend on the type of work. For example, a more collaborative
environment may benefit from an open layout, while a job that requires discretion would better operate
with separate offices or cubicles to ensure privacy.
Furnishings
Desks, chairs, conference tables and other workplace furniture can also impact employees on the job.
Access to comfortable and adequate seating, clean workspaces and functional desks can ensure indoor
workplaces remain efficient. Outdoor workplaces may include comfortable furniture for break times.
Equipment
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Some roles require special equipment to do their job, and depending on the company, the employer may or
may not provide it. Some roles, such as a mechanic, may be required to bring their own set of tools.
Indoor office spaces are more likely to provide the necessary equipment, such as computers, printers and
other essential technology used on the job.
Facilities
Other facilities can influence how you feel physically and mentally during your working life. Being able
to take a break or go to the bathroom are essential parts of any productive daily routine, so the location of
these facilities can also impact the work environment. Additional facilities such as relaxing spaces and on-
site gyms can also have a positive influence on employees.
Location
Some roles predominantly work inside, some spend most of their working day outside and certain roles
may have a mixture of both indoor and outdoor work. Many employers may provide additional facilities
or equipment to ensure employees are comfortable while working and productivity is maintained.
Company culture
Code of conduct
Some companies may explain their business culture in a formal code of conduct or provide guidelines for
employees. These documents can have you following certain conditions when performing tasks as well as
when interacting with coworkers, workplace leaders and external stakeholders. These guidelines are often
found in an employee handbook.
Encouragement and development
Some employers directly promote collaboration and teamwork, emphasize positive feedback and
consistently celebrate employees who succeed. Other employers may provide more constructive feedback
to encourage employees to improve.
Company mission statement
This statement is a set of values the company seeks to advance through its work. While these values may
not be discussed daily, they guide every task you do and each goal you set as a contributor to the
organization.
working conditions
The following elements determine what the day-to-day may look like and how your employment impacts
areas of your life unrelated to work:
Work-life balance
The number of hours worked each week and when can vary depending on the role, company and industry.
Some organizations may promote work-life balance by offering generous paid time off or flexible work
schedules. Other employers may encourage employees to work overtime to meet deadlines or provide 24/7
service to clients.
Terms of employment
In addition to set hours, these terms may include whether your work is a temporary contract or permanent
employment. This element may also include benefits and paid time off stipulations as well.
Workplace safety
There are nationally mandated workplace safety regulations that all employers must follow. Your
employer might display the regulations in public spaces to ensure all employees understand and adhere to
these policies. Also, the safe use of equipment, as well as accessibility to exits, emergency equipment and
first-aid, impacts this element of working conditions.
Healthy lifestyle
Some employers may encourage employees to stay fit and eat balanced meals to improve their overall
well-being. They may even stock healthy snacks, partner with a nearby gym or host team events that
incorporate physical activity.

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7. SYSTEMS APPROACH TO MANAGEMENT
A systems approach is a holistic and interdisciplinary way of understanding and solving complex
problems. It views the world as a collection of interconnected and interdependent elements or people, and
emphasises the relationships and interactions between them.

Features of systems approach to management

Some of the features of the systems approach are:
1. Interconnected sub-systems: an organisation is like a big puzzle made up of smaller pieces that work
together. These pieces, called sub-systems, interact and depend on each other for the organisation to
function properly.
2. No isolation: we can’t understand the sub-systems by looking at them individually. Instead, we need
to see how they relate to each other and to the organisation as a whole. It’s like understanding how
each puzzle piece fits into the larger picture.
3. Boundary: an organisation has a boundary that sets it apart from other systems. It helps us identify
which parts are inside (like employees) and which parts are outside (like customers). This boundary
defines the organisation’s scope and limits.
4. Changing environment: organisations are dynamic systems because they are affected by their
environment. They can be influenced by things, like power cuts, strikes, or shifts in customer
preferences. That’s why management needs to keep an eye on what’s happening outside and make
adjustments when needed.
5. Sensitivity to the environment: because organisations are influenced by their environment, they need
to be sensitive to changes. Just like we react when something unexpected happens, organisations must
be responsive and adapt to external factors that may affect their operations.
6. Monitoring and taking action: to ensure a healthy organisation, it’s crucial to constantly monitor its
well-being. Management needs to pay attention to signs of problems and take corrective action
promptly. It’s like regularly checking the pulse of the organisation to make sure everything is running
smoothly.

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Assignment question
Unit-1
1. What is management? Explain its functions.
2. Discuss the administrative theory of management of Henri Fayol.
3. Describe the scientific management of F W Taylor.
4. Contrast between Maslow’s hierarchy needs and Mc Gregory X and Y Theory.
5.

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