Introduction to management

Mgmt 2062
CHAPTER ONE
FUNDAMENTALS/OVERVIEW OF
MANAGEMENT
Overview of Management
Objectives of the chapter
After studying this chapter, you should be able to
1. Understand the term management, basic concepts and
principles of management.
2. Demonstrate management skills and roles
3. Describe the primary types of managers and the roles they
play
1.1 Basics of Management
Organization:-
Systemic arrangement of people brought together to
accomplish specific purpose.
Every organization has a purpose and is made up of
people who are grouped in some fashion.
The distinct purpose of an organization is typically
expressed in terms of a goal or set of goals.
Clusters of peoples work in the organization?
• Managers: are persons in the position of authority who
make decisions to commit (use) their resources and the
resource of others towards the achievement of
organizational objective. i.e different from
operatives
Operatives: are peoples who work directly on a job or
task and have no responsibility for overseeing the
work of others.
 1.2 Meaning and Definition of Management
what is Management?

Management:.
• is the art of getting things done through other people
by making the atmosphere conducive for others.
• It is the process that emphasize on both the objectives
to be attained and the people who will be pursuing
them.
• is the utilization of scientifically derived principle to
examine and improve efforts or production.
Management may be defined as the art of securing
maximum results with a minimum of efforts so as to
secure maximum prosperity for both the organization and
the individual and give the public, the best possible
service.

It is the process of coordinating all resources

through the five major functions of planning,
organizing, staffing, directing/leading and
controlling to achieve organizational goals/desired
objectives.
Even though no universally accepted definition of
management,
It refers to the process of managing and completing
activities of organization efficiently and effectively.
Efficiency: doing things correctly, refers to the
relationship between inputs and outputs, seeks to
minimize resource costs.
Effectiveness: doing the right things, goal attainment,
 1.3. Significance of Management
The common significances of management are
o Achievements of group goals: management makes
group efforts more effective
o Optimum utilization of resources : there are eight `M`
in the business (men, money, materials, machines, methods,
motivation, market, and management). Management is the
top of the other because always concentrates on achieving
the objectives of the enterprise by effective utilization of
resources.
o Minimization of cost: base of business competition is
minimizing cost of production and distribution
Significance
o Change and growth: business enterprises operate in a
constantly changing environment.
o Effective functioning of business,
o Higher profit,
o Provide innovation,
o Tool for personal development
1.4 Basic Management Functions
There are five basic managerial functions in any
organizations. These managerial functions are
• planning,
• organizing,
• staffing,
• directing/leading and
• controlling
 1. Planning: Means deciding in advance what action to
take and when and how to take them
Planning includes defining goals, establishing strategy,
and developing plans to coordinate activities
Planning bridges the gap between where we are and
where we want to be in a desired future
Planning helps ,
firstly for allocating the organizations limited resources
towards achieving its objectives in the best possible manner
 secondly for anticipating the future opportunities and
problems
2. Organizing: refers to the formal grouping of people
and activities to facilitate achievement of the firm’s
objectives.
It focuses on organizing and arranging human and non
human resources so that plans can be carried out
successfully
In general Organizing is the process of identifying and grouping
the work to be performed, defining and delegating responsibility,
arranging money, material, machinery, personnel, and selecting the
optimal method of actual execution of work in order to accomplish
the objective effectively
3. Staffing: Staffing involves recruitment of personnel required
for managerial and non managerial positions in the organization
structure.
It is concerned with locating prospective employees to fill the jobs
created by the organizing process
It basically deals with
inventorying the people available,
announcing vacancies,
accepting,
identifying the potential candidates for the job,
recruiting, selecting, placing, orienting, training and
promoting both candidates and existing employees..
4. Directing/leading: termed as motivating, influencing,
guiding, stimulating of employees. It involves influencing people so
that they will contribute to the organization and group goal
Leading is the most complex managerial function
because it deals with complex human behavior,
It includes communicating with others, helping to
outline a vision of what can be accomplished, providing
direction, and motivating organizational members to put
forth the substantial effort required.
5. Controlling: planning and controlling go hand in hand.
There can’t be control without a plan and plans cannot be
successfully implemented in the absence of controls.
Controls provide a means of checking the progress of the
plans and correcting any deviations that may occur along the
way.
Controls may be used to measure physical quantities,
monetary results or to evaluate intangibles such as
employee loyalty, morale, and commitment to work
It deals with establishing standards, measuring
actual performance, comparing the actual
performance with standards, measuring the
variance or deviation and taking corrective actions
for deviations
1.5 Levels of Managers
Although all managers may perform the same basic
duties and play similar roles, the nature and scope of
their activities differ. These differences are the base for
the classification of managers.
Managers can be divided based on two criteria: levels
of management (vertical difference), and scope of
responsibilities (horizontal difference).
I. Types of managers based on levels of management:
Levels refer to hierarchical arrangement of managerial
positions or persons in an organization. In most
organization there are three distinct levels. Based on levels
of management or hierarchy we do have three types of
managers
1. The First Level Managers /First line managers
These managers are in direct contact with the
employees, who usually produce the goods or services out
puts of all organization.
They are referred to as supervisors or foremen in some
organizations
They are responsible for overseeing and coordinating the day-to-
day work of operating employees.
Serve as a bridge between managers and non managers. -Spent
much of their time in leading and little in planning
Are managers on which management depends on the execution of
its plan since their job is to deal with employees who actually
produces the organizations goods and services to fulfill the plan.
E.g. department head, supervisor personnel, sales manager, office
managers.. etc
2. The Middle Level Managers
Middle level managers occupy a position in an
organization that is above first line management and
below top management
They interpret and implement top management directives and
forward messages to and from first-line management

They direct the activities of firs-line mangers, for

example, an academic deans, division heads, plant
managers, army captain are belonged to middle level
managers.
3. The Top Level Managers
Top-level managers are managers who are at the top of
the organizational hierarchy and are responsible for the
entire organization
They are a small group of policy makers responsible for
the overall strategic management of the organizations and
develop overall structure of the organization.
Are persons who are responsible for making decisions
and formulating policies that affect all aspects of the
firm’s operation.
 A president or a chief executive officer, vice presidents
are example of top managers.

All managers carry out managerial functions. However,

the time spent for each function varies according to their
managerial hierarchy. Top level managers spent more time
on planning and organizing than lower-level managers
Levels of Management
Top managers

Middle managers

First-line managers

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Areas of Management
Distribution of Time per Activity by Organizational
Level
II. Functional and General Managers
Mangers are also classified on the scope of the
activities they manage in to functional and general
managers
1. Functional managers: are managers who are
responsible for a department that performs a single
functional task and has employees with similar
training and skills.
 Supervise employees with specialized skills in
specific areas of operations such as accounting,
payroll, finance, marketing, production, or sales.
They are responsible for only one
organizational activities; i.e. their responsibility
is limited to their specialization/ specification
2. General Managers: are managers who are
responsible for several departments that
perform different functions
They are responsible for the entire operations
of the organization without being specific.
They will be responsible for all activities of
that unit, such as its production, marketing,
sales and finance.
A small company may have only one
general manager-but a large organization
may have several, each at the head of a
relatively independent division.
1.6.The Managerial Skills at Various Levels
Skills are specific abilities that result from knowledge,
information, practice, and aptitude. These skills refer to the
personal ability put to use by the manager in specific
position that he/she holds in the organizational hierarchy.
Management success depends both on: a fundamental
understanding of the principle of management and the
application of technical, human and conceptual skills
For the purpose of discussion, managerial skills are
classified in to three distinct categories: technical,
human/interpersonal and conceptual/diagnostic skills.
1.Technical Skill
It involves process or techniques, knowledge and
proficiency.
It is the ability to use the tools, procedures, or
techniques of equipment involved in specific functions
such as engineering, manufacturing, finance, computer
programming.
The ability to do right job in right manner.
Technical skills are most important at the lower levels of
management. It becomes less important as we move up the
hierarchy.
2.Human Skill /interpersonal
Human skill is the ability to work with, understand and
motivate other people either as individuals or groups
 It is the manager’s ability to work effectively as a
group member and to build cooperative effort within the
team whereas technical skill is primarily concerned with
working things (process or physical objects).
These skills are demonstrated in the way a manager
motivates, facilitates, coordinates, leads, communicates,
and resolves conflicts.
The first level manager is involved on a regular basis
with the personal problems and life events of many non-
managers.
3. Conceptual Skill
This skill means the ability to see the organization as a
whole and it includes recognizing how the various
functions of the organization depends one another.
It also makes the individual aware how changes in any one part of
the organization affect all the others.
 It extends to visualizing the relationship of the individual
business to the industry, the community and the political, social and
economic forces of the nation as a whole.
 Conceptual skills are more important in strategic (long range)
planning: therefore, they are more important to the top-executive
than middle managers and supervisors

Although all three of these skills are essential to effective

management, their relative importance to specific manager
depends on the rank in the organization.
technical skill deals with things, human skill concerns
people and conceptual skill has to do with ideas.
1.7 Managerial Roles
Role is an organized set of behavior that is associated with a
particular office or position.

Managerial roles represent specific tasks that managers undertake

to ultimately and accomplish the five managerial functions
Henry Mintzberg indicated 10 managerial roles which are in turn
grouped in to three categories: interpersonal, informational and
decisional role. Informational Decisional
Interpersonal Roles roles
• Entrepreneur
roles •Monitor •Disturbance Handler
•Figurehead •Disseminator •Resource Allocator
•Leader •Spokesperson •Negotiators
•liaison
1. Interpersonal Roles: involves developing and
maintaining positive relationships with significant others in
the organization. It is communication oriented
A. Figurehead Role: in the figurehead role, the manager
represents the organizations at ceremonial and symbolic
functions. It is the most basic and the simplest of all
managerial roles
Example signing documents presiding at the ceremonial
events, greeting visitors, attending a subordinate’s
wedding, taking a customer to lunch, university president
hands out a diploma for graduates-in
 B. Leadership Role: the leadership role involves
responsibility for directing and coordinating the activities
of subordinates in order to accomplish organizational
objectives.
The leader builds relationship and communicates with
employees, motivates and coaches them.
 As a leader, the manager is responsible for hiring,
training, motivating and encouraging employees or
subordinates.
C. Liaison Role: the liaison role refers to dealing with
people outside the organizations.
It maintains a network of contacts outside the work unit
to obtain information. She/he fulfill his/her role through
community service, conferences, social events, etc.
 It also refers to dealing with managers in other
departments, staff specialists, and other department
employees. manager seeks support from people who can
affect the departments’ and the organizations’ success.
2. Informational Roles: effective managers build networks
of contacts and sharing information, because of these
contacts, managers serve as the nerve system centers of
their organizations
A. Monitor Role: is also called information gathering role.
This role refers to seeking, receiving, screening and getting
information..
The monitor seeks internal and external information
about issues that can affect the organization. Information is
gathered from news reports, trade publication, magazine,
clients, attending seminars and exhibitions.
 B. Disseminator Role: In the disseminator role, the
manager shares information with subordinates and other
members of the organization.
After the information has been collected, it has to be
disseminated to superior, subordinator, peers, and other
concerned body.
The type of information to be forwarded to members
could be facts, opinions, interpretations, and influences.
C. Spokesperson/Representative Role: the spokesperson
transmits information about the organization to outsiders.
The manager is the person who speaks for his/her work
unit to people outside the work unit.
One aspects of it is to communicate outside the
organization like press, government agencies, customers
and labor union
3. Decisional Roles: manager use information to make
decisions about when and how to commit their organization
to new objectives and actions.
Managers are the core of the organization’s decision-
making since they play the following four decisional roles.
A. Entrepreneur Role: the manager acting as an
entrepreneur recognizes problems and opportunities and
initiates actions that will move the organization in the
desired direction.
Often manager creates new projects, change
organizational structure, and institutes other important
programs for improving the company’s performance.
The entrepreneur acts as an initiator, designer, encourager
of change and innovation.
B. Disturbance Handler Role: the manager responds to
situations over which he/ she has little control, i.e. that are
beyond his/her control and expectation such as conflict
between people among groups, strikes, breach of contract
or unexpected events outside the organization that may
affect the firm’s performance.
The disturbance handler is responsible for taking
corrective action when the organization faces important,
unexpected difficulties.
C. Resource Allocator Role: deciding on the allocation of the
organization’s physical, financial and human resources.
the manager is responsible for deciding how and to whom the
resource of the organization and the manager’s own time will be
allocated.
The resource allocator distributes resources of all types, including
time, funding (finance), equipment and human resources.
D. The Negotiator Role: closely linked to the resource
allocator role is the negotiator role.
 In this role managers meet and discuss their differences
with individuals or groups for the purpose of reaching an
agreement.
Managers spend a great deal of their time as negotiators,
because only they have the information and authority that
negotiators require.
Examples include negotiations to buy firms, to get credit,
with government, with suppliers, with labor union, etc.
1.8. Is management Science or Art?
The question whether management is an art or science has
been an issue of debate for a long period of time.
Science is characterized by making conclusions based on
actual facts and verifies knowledge through cause-effect
relationship.
It can be generally learnt, thought, and researched to
know the universal truth.
Managers can work better by using the organized
knowledge about management, and it is this knowledge that
constitutes a science
Art is characterized by using common sense, personal
feeling, beliefs, impulses, etc. management like all other
practices is an art.
It is know-how, skill or how to accomplish the desired
objectives with insufficient data and information or when
there is limited use of secondary sources of information
Therefore, management in actual sense is neither an art
nor science, but it requires both to be successful.
 Management is one of the most creative arts as it requires
a vast knowledge and the innovative skills to apply
Managers should develop new ideas, techniques and
strategies and be able to communicate them effectively in
the work environment
1.9. Management as Profession and Principles of
management
A profession is a vocation founded upon specialized
educational training, the purpose of which is to supply
unbiased counsel and service to others for a direct and
definite compensation, wholly apart from expectation of
other business gain.
The essentials of a profession are that it provides
specialized knowledge, formal education and training; it
creates sense of social desire to serve society and teaches code of
conduct etc.
Management fulfils several essentials of a profession; even
then it is not a full-fledged profession because of the following
reasons:
• It does not restrict the entry in managerial jobs for account of
one standard or other.
• No minimum qualifications have been prescribed for managers.
No management association has the authority to grant a
certificate of practice to various managers.
• Managers are responsible to many groups such as
shareholders, employees and society.
• Managers are known by their performance and not
just their educational qualifications or university
degrees.
Principles of Management
14 Principles of Management – Henry Fayol
1. Division of Work: allows for job specialization. Work
should be divided among individuals and groups.
2. Authority and Responsibility: Authority right to
give orders. Responsibility involves being answerable.

Whoever assumes authority assumes responsibility

3. Discipline: Common efforts of workers. Penalties
4.Unity of Command: Employees should have only
one boss.
5. Unity of Direction: A single plan of action to guide
the organization.
6. Subordination of individual interests to the
general interests of organization
7. Remuneration: An equitable uniform payment
system that motivates and contribute to success.
8. Centralization: The degree to which authority rests
at the top of the organization.
9. Scalar Chain: Chain like authority scale.
10. Order: The arrangement of employees where they
will be of the most value to the organization
11. Equity: The provision of justice and fair dealing
12. Stability of Tenure of Personnel
13. Initiative
14. Esprit de corps: Harmony, general good feeling
among employees
1.10 Universality of Management
oRegardless of title, position, or management level, all
managers do the same job
oManagers are the same whether the organization is
privet or public, profit making or nonprofit making,
manufacturing or service giving, and industrial or small
firms
Hence, management is universal for the following reasons
All managers perform the five managerial functions
even if with different emphasis.
It is applicable for all human efforts; be it business, non-
business, governmental, private. It is use full from
individual to institutional efforts.
Management utilizes scientifically derived operational
principles.
Management, in all organizations, helps to achieve
organizational objectives
In sum, management theories and principles have
universal application in all kinds of organized and
purposeful activity and at all levels of management.
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