Principles of

Management
Definition
What is Management?

 "Management is a process of designing and

maintaining an environment in which individuals

working together in groups, efficiently accomplish

selected aims".

 Management is the process of achieving goals and

objectives effectively and efficiently through and with

the people.
Management defined…

 As managers, people carry out the

managerial functions of planning, organizing,
staffing, leading and controlling.
 Management applies to any kind of
organization.
 Organization: a group of people working
together to create a surplus.
 Profit making / business organization
 Nonprofit / service organization
Management defined…

 Management applies to managers at all

organizational levels.
 The aim of all managers is the same: to
create a surplus.
 Managing is concerned with productivity,
which implies effectiveness and efficiency.
Management is…

Efficiency
Efficiency
Getting
Getting work
work
done
done through
through
others
others Effectiveness
Effectiveness
Efficiency

 Efficiency refers to the ability to produce

maximum output from the given input with the
least waste of
 Time
 Effort
 Money
 energy
 raw materials
Effectiveness

 Effectiveness refers to the extent to which

something has been done, to achieve the targeted
outcome.
 It means the degree of closeness of the
achieved objective with the predetermined goal to
examine the potency of the whole entity.
Efficiency
Effectiveness

 The ability to produce maximum  The level of the nearness of the

output with limited resources actual result with planned
 ‘to do the things perfect’ result
  ‘to do perfect things’
outcome of actual output upon
given the number of inputs  an extroverted approach
 measures the performance of  highlights the relationship of
operations, processes, workers, the business organisation with
cost, time, etc. inside the the rest of the world
organisation
 To attain a competitive position
 clear focus on reducing the in the market
expenditure or wastage or
 it helps the organisation to
eliminating unnecessary costs
to achieve the output with a judge the potency of the whole
stated number of inputs organisation
Productivity.

 The output-input ratio within a time period

with due consideration for quality.

 Is a function of effectiveness and efficiency.

 Effectiveness: the achievement of

objectives.

 Efficiency: the achievement of the ends

with least amount of resources.
Levels of management
Organizational hierarchy

Top
Management
President, CEO,
Executive
Vice Presidents

Middle Management
Plant Managers, Division Managers,
Department Managers

First-Line Management
Foreman, Supervisors, Office Managers

Non- Managerial Employees

 Levels of management

 Top Level: Top management sets the mission and goals,

develops policies, evaluates the overall performance of
various departments, responsible for the business as a
whole and is concerned mainly with long-term planning

 Middle Level: Middle level management develops

departmental goals, executes the policies, plans and
strategies determined by top management, develops
medium- term plans and supervises and coordinate lower-
level managers’ activities
Levels of management

 Lower (Supervisory, frontline) Level: Lower level

management takes charge of day-to-day operations, is
involved in preparing detailed short-range plans, is
responsible for smaller segments of the business,
executes plans of middle management , guides staff in
their own subsections and keep close control over their
activities.
Importance of management functions to
managers in each level
Managerial skills

 Robert L Katz identified three kinds of skills

for managers.
 Technical skills
 Human skills
 Conceptual skills

 Design skills
 Managerial skills Cont’d

Technical skills:

 These skills include the knowledge, abilities of and

proficiency in activities involving methods, processes and
procedures in the relevant fields as accounting,
engineering, manufacturing etc.

Or in short:

 The ability to use the knowledge or techniques of a

particular discipline to attain ends
 Managerial skills Cont’d

Human skills:

 This includes the ability to understand other people and

interact effectively with them. The human skills are also
important in creation of an environment in which people
feel secure and free to express their opinions.

In short it is:

 The ability to work with other people in teams

 Managerial skills Cont’d

Conceptual skills:

 This refers to the ability to think and conceptualize abstract

situations. These abilities are required for making complex
decisions.

In short it is:

 The mental capacity to develop plans, strategies and vision

 Managerial skills Cont’d

Design skills:

 These skills enable a manager to handle and solve any kind

of unforeseen or actual problems, that may crop up in the
organization. Such problems could arise due to internal
factors or external factors and/or both.

In short it is:

 The problem solving skill

Skill distribution at various
management levels
Characteristics of Excellent
Companies

 “In Search of Excellence” – Thomas peters

& Robert Waterman.
1. Were oriented toward action.
2. Learned about the needs of their customer.
3. Promoted managerial autonomy and
entrepreneurship.
4. Achieved productivity by paying close
attention to the needs of their people.
Characteristics of Excellent
Companies

5. Were driven by a company philosophy often

based on the values of their leaders.
6. Focused on the business they knew best.
7. Had a simple organization structure with a
lean staff.
8. Were centralized as well as decentralized,
depending on appropriateness.
Management: Science or Art?

 Science is a collection of systematic knowledge, collection of

truths and inferences after continuous study and
experiments. It has fundamental principles discovered.

 Art uses the known rules and principles and uses the skill,
expertise, wisdom, experience to achieve the desired result.

Management has got two faces like a coin; on one side it is art
and on the other it is science. Management has got scientific
principles which constitute the elements of Science and Skills
and talent which are attributes of Art.

Management is both art and science.

 Evolution of Modern
Management
1. Classical management approaches focus on developing universal
principles for use in management situations.

2. Behavioural (or human resource) management approaches

focus on human needs, the work group and the role of social factors in
the workplace.

3. Quantitative management approaches focus on applying

mathematical techniques to assist managerial decision making and
problem solving.

4. Modern (or systems/contingency) approaches to management

view organisations as a collection of interrelated parts, requiring
 Classical Approaches to
Management
 There are three main branches within the classical management
approach:

 Scientific management (Taylorism)

 Administrative principles (Fayolism)

 Bureaucratic organisation

 Each of these approaches shares a common assumption that

employees in the workplace act in a rational manner, and are
primarily driven by economic concerns. That is, employees rationally
consider opportunities made available to them and then do whatever
is necessary to achieve the greatest personal and financial gain.
Classical Approaches to
Management

 Prominent classical management theorists of the late 19th and

early 20th centuries included Frederick Taylor, Frank and Lillian
Gilbreth, Henry Fayol, Mary Parker Follett and Max Weber.
Frederick Taylor –
Scientific Management

 Known as father of scientific management

(Taylorism).
 Published “Principles of Scientific Management” –
1911.
 Focus heavily on individual worker productivity.
 Contributions:
 Time and Motion Studies
 (Time study- Taylor; Motion study- Frank & Lillian Gilbreth)
 Scientific selection of workers
 One best way of doing a job
Frederick Taylor –
Scientific Management

 Fundamental principles:
 Replacing rules of thumb with science (organized
knowledge).
 Obtaining harmony, rather than discord, in group action.
 Achieving cooperation of human beings, rather than
chaotic individualism.
 Working for maximum output, rather than restricted
output.
 Developing all workers to the fullest extent possible for
their own and their company’s highest prosperity.
Fayol’s Principles of
Management

 Father of Modern Management Theory

 He has proposed that there are six primary

functions of management and 14 principles of
management, Forecasting, Planning, Organizing,
Commanding, Coordinating, controlling Henri Fayol
(1841-1925)
 There are 14 Principles of Management (Fayolism)
described by Henri Fayol.
14 Principles of Henri Fayol

 Division of Labor
 Work of all kinds must be divided & subdivided and allotted to
various persons according to their expertise in a particular area.

 Authority & Responsibility

 Authority refers to the right of superiors to get exactness from
their sub-ordinates.

 A manager may exercise formal authority and also personal

power.

 A manager must be prepared to bear responsibility to perform

the work in the manner desired.
14 Principles of Henri Fayol
Cont’d

 Unity of Command
 A sub-ordinate should receive orders and be accountable to one and
only one boss at a time.

 He should not receive instructions from more than one person

 Unity of Direction
 People engaged in the same kind of business or same kind of
activities must have the same objectives in a single plan.

 Without unity of direction, unity of action cannot be achieved.

14 Principles of Henri Fayol
Cont’d

 Equity
 Equity means combination of fairness, kindness & justice.

 The employees should be treated with kindness & equity if devotion

is expected of them.

 Order
 This principle is concerned with proper & systematic arrangement of
things and people.

 Arrangement of things is called material order and placement of

people is called social order.
14 Principles of Henri Fayol Cont’d

 Discipline
 Discipline means sincerity, obedience, respect of authority &
observance of rules and regulations of the enterprise.

 Subordinate should respect their superiors and obey their order.

 Initiative
 Initiative means eagerness to initiate actions without being asked to
do so.

 Management should provide opportunity to its employees to suggest

ideas, experiences & new method of work.
14 Principles of Henri Fayol Cont’d

 Remuneration
 Remuneration to be paid to the workers should be fair, reasonable,
satisfactory & rewarding of the efforts.

 It should accord satisfaction to both employer and the employees.

 Stability of Tenure
 Employees should not be moved frequently from one job position to
another i.e. the period of service in a job should be fixed.
 14 Principles of Henri Fayol
Cont’d
 Scalar Chain
 Scalar chain is the chain of superiors ranging from the ultimate authority to
the lowest.

 Communications should follow this chain. However, if following the chain

creates delays, cross-communications can be allowed if agreed by all parties
and superiors are kept informed.

 Sub-ordination of Individual Interest to common goal

 An organization is much bigger than the individual it constitutes, therefore
interest of the undertaking should prevail in all circumstances.

 The interests of any one employee or group of employees should not take
precedence over the interests of the organization as a whole.
14 Principles of Henri Fayol
Cont’d

 Espirit De’ Corps

 It refers to team spirit i.e. harmony in the work groups and mutual
understanding among the members.

 Espirit De’ Corps inspires workers to work harder.

 Centralization
 Centralization refers to the degree to which subordinates are
involved in decision making. Whether decision making is centralized
(to management) or decentralized (to subordinates) is a question of
proper proportion. The task is to find the optimum degree of
centralization for each situation.
BEHAVIORAL MANAGEMENT

 Emerged because the classical approach did not

achieve the productivity.
 Human relations
 Employees- the backbone of the company
 Employees participated in taking the key decision.
 Training and counseling were provided
BEHAVIORAL MANAGEMENT

 Workers treated as like humans not as machines

 Behavior is defined as the way a person
conducts themselves towards others
 If all management had to do was spend time,
express interest in workers' personal well-being,
and reward them for a job well done, workers
would feel motivation to work harder
BEHAVIORAL MANAGEMENT

 Human needs are never completely satisfied.

 Human behavior is purposeful and is motivated by
the need for satisfaction.
 Needs can be classified according to a hierarchical
structure of importance, from the lowest to
highest.
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Hawthorne Studies

 By Elton Mayo & F.J. Reothlisberger during1924-1927

 Conducted by The National Research Council (NRC) of
the National Academy of Sciences with engineers from
MIT
 Measured Light Intensity Vs. Worker Output
 Result :
 Higher worker productivity and satisfaction at all light
levels
 Conclusions:
 Light intensity has no conclusive effect on output
 Productivity has a psychological component
 Concept of “Hawthorne Effect” was created
Hawthorne Effects

 The major finding was that almost regardless of the

experimental manipulation (brightness of lights, humidity,
breaks, group pressure, working hours, managerial
leadership), the production of the workers seemed to
improve.

 One reasonable conclusion is that the workers were pleased

to receive attention from the researchers who expressed an
interest in them.

 Work-group norms affect productivity.

 The workplace is also a social system.

Management science theory

 Started at the beginning of world war II in Britain.

 Formation of OR – Mathematical techniques for
the modeling, analysis, and solution of
management problems.
 To solve the complex problems in the war field.
Management science theory

 Definition- Management science approach, also

known as mathematical or quantitative
measurement approach, visualizes management
as a logical entity, the action of which can be
expressed in terms of mathematical symbols,
relationships, and measurement data
Management science theory

 Features-
 Management is regarded as the problem-solving
mechanism with the help of mathematical tools
and techniques.
 This approach covers decision-making, systems
analysis, and some aspects of human behaviour.
 Various mathematical tools like sampling, linear
programming, game theory, regression analysis,
simulation, waiting line theory, network diagrams
like CPM, PERT are using for decision making.
 Bureaucratic Organizations

 Suggested by Max Weber

 Bureaucratic organisation approaches can be described as an organisation

striving for maximum efficiency based on the following principles:

 A clear division of labour with jobs being well defined and done by
people who are (or can become) highly skilled at performing the tasks of
the particular job

 A clear hierarchy of authority

 Formal rules and procedures that are impartially and universally applied
to guide staff behaviour

 Employee selection and promotion based on merit.

 Bureaucratic Organizations

Board of
Directors

Chief Executive

Production Marketing & Accounting Personnel Quality Health &

Department Sales & Finance Department Department Safety
Department Department
Approaches to Management

 Empirical or Case Approach

 Managerial Roles Approach
 Contingency or Situational Approach
 Mathematical or Management Science
Approach
 Decision Theory Approach
 Reengineering Approach
 Systems Approach
Approaches to Management

 Socio-technical Systems Approach

 Cooperative Social Systems Approach
 Group Behavior Approach
 Interpersonal Behavior Approach
 McKinsey’s 7-s Framework
 Total Quality Management Approach
 Management Process or Operational
Approach
 Empirical or Case Approach

 Studies experience through cases.

 Identifies successes and failures.
 No principles are identified.

Case
situation

Failure Success

Why?
Managerial Roles Approach

 Henry Mintzberg studied the activities of five

CEOs in a variety of organizations.
 Observed what managers actually do and from
such observations came to conclusions as to what
managerial activities (roles) are.
 Executives do not perform the classical
managerial functions.
 10 managerial roles.
 Managerial Roles Approach

 Interpersonal roles
1. The figurehead role
2. The leader role
3. The liaison role
 Informational roles
4. The recipient role
5. The disseminator role
6. The spokes person role
 Decision roles
7. The entrepreneurial role
8. The disturbance-handler role
9. The resource-allocator role
10. The negotiator role
 Roles of manager

 Role: a set of expectation for one’s behavior

Roles of Manager

Decisional Informational
Interpersonal
• Entrepreneur
• Figurehead • Recipient
• Disturbance
• Leader • Disseminator
handler
• Liaison • Spokesperson
• Resource allocator
• Negotiator
 Roles of manager Cont’d

 Inter-personal Role

 Figurehead: Represents the company on social occasions. Attending the

flag hosting ceremony, receiving visitors or taking visitors for dinner etc.

 Leader: In the role of a leader, the manager motivates, encourages, and

builds enthusiasm among the employees. Training subordinates to work
under pressure, forms part of the responsibilities of a manager.

 Liaison: Consists of relating to others outside the group or organization.

Serves as a link between people, groups or organization. The negotiation of
prices with the suppliers regarding raw materials is an example for the role
of liaison.
 Roles of manager Cont’d

 Decisional Role:

 Entrepreneur: Act as an initiator and designer and encourage changes

and innovation, identify new ideas, delegate idea and responsibility to
others.

 Disturbance handler: Take corrective action during disputes or crises;

resolves conflicts among subordinates; adapt to environmental crisis.

 Resource allocator: Decides distribution of resources among various

individuals and groups in the organization.

 Negotiator: Negotiates with subordinates, groups or organizations- both

internal and external. Represents department during negotiation of
union contracts, sales, purchases, budgets; represent departmental
 Roles of manager Cont’d

 Informational role:

 Recipient: Receives information from the external environment.

 Disseminator: Transmits information received from other

employees to members of the organization.

 Spokesperson: Transmits information to the people who are

external to the organization, i.e., government, media etc. For
instance, a manager addresses a press conference announcing a
new product launch or other major deal.
Contingency or Situational
Approach
 Contingency approach to management views organisations as a
collection of interrelated parts requiring management practices
to adapt to situational demands.

 Contingency thinking tries to match managerial responses with

problems and opportunities unique to different situations, with
the underlying principle that there is no one best way to
manage; the appropriate way to manage depends on the
situation.

 An appreciation of how management thinking has evolved over

time provides a useful framework for managers to apply a
Mathematical or Management Science
Approach

 Purely logical analysis.

 Expressed in mathematical symbols and relationships.
 Quantitative Management approaches focus on
applying mathematical techniques and analysis to
assist managerial decision making and problem solving.
 Today, these quantitative applications are increasingly
driven by computer technology and software programs.
 Many aspects can not be modeled.
Decision Theory Approach

 Decisions decide the future.

 Manager – Decision maker.
 Organization – Decision making unit
 Focuses on decision making and people
involved in it.
 Features
 Management is decision making.
 Members of Organization - decision makers and
problem solvers.
 Decision making - control point in management
 Increasing efficiency - the quality of decision
 Focuses only on one aspect.
Reengineering Approach

 "the fundamental rethinking and radical redesign

of business processes to achieve dramatic
improvements in critical, contemporary measures
of performance, such as cost, quality, service and
speed.“- Hammer & Champy

James Champy

Michael Hammer
 Organizational Environment
Theory (System Approach to
Management)
 An organized enterprise depend on its external
environment – economic system, society
 Enterprise receives input and transforms them in
to output to the environment.
 The transformation process are the managerial
functions like planning, organizing, staffing,
leading and controlling.
 Open system includes interactions between the
enterprise and its external environment.

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Systems Approach

 Organizations are open systems.

 Recognizes the importance of studying the
interrelations of the managerial functions in an
organization.

Reenergizing the
system

Inputs Transformation Outputs

process

External
environment
  Inputs
 Human, capital(Land, equipment, building),
technology, information.
 Goals
1. Employees
2. Consumers
3. Suppliers
4. Stockholders
5. Governments

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  Managerial transformation process
 Transforms the input into output
1. Basis of global management theories
2. Planning
3. Organizing
4. Staffing
5. Leading
6. Controlling

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  Outputs
 Vary with the enterprise
1. Products
2. Services
3. Profits
4. Satisfaction
5. Goal Integration

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  The communication System
1. Integrates the managerial functions
 Objectives set in planning are communicated
 Essential in the selection, appraisal, and training
 Ensure the events and performance confirm to
plans
2. Link enterprise with the external environment

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  Reenergizing the system
 Some of the outputs becomes inputs again
1. New knowledge of employees
2. Profits, surplus reinvest

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Sociotechnical Systems
Approach

 Relates technical systems and social systems.

 Focuses on production systems.
 Ignores other managerial functions.
Cooperative Social Systems
Approach

 Concerned with both interpersonal and group

behavioral aspects leading to a system of co-
operation.
Group Behavior Approach

 Focuses on behavior of people in group.

 Related to organizational structure, staffing.,
Interpersonal Behavior
Approach

 Focuses on interpersonal behavior.

 Psychological training is not enough for becoming
an effective manager.
McKinsey’s 7-s Framework

1. Strategy
2. Structure Hard elements
3. Systems
4. Style
5. Staff
Soft elements
6. Shared values
7. Skills
 1980s by Tom Peters and Robert Waterman
 Ensure that all parts of the organization work in harmony.
 Takes the company from current position to next higher level.
McKinsey’s 7-s Framework
Shared Values

 Involves creating economic value in a way that also

creates value for society by advertising its needs and
challenges.
 Business should reconnect company success with
social progress.
 Adidas low cost shoes
 BMW mobile laboratory
 Micronutrient campaign
Total Quality Management
Approach

 Quality = features and attributes

= absence of deficiencies
 People committed to employ organizational resources to
provide value to the customer by doing the right things,
right at the first time, every time.
 management approach to long–term success through
customer satisfaction.
 US Navy in 1984,to improve the operational effectiveness.
 Philip B Crosby, W Edwards Deming, Joseph M Juran
 all members of an organization participate in improving
processes, products, services, and the culture in which they
work.
Total Quality Management
Approach
 Depends on feedback system
 Performance superiority in delighting customers
Management Process or Operational
Approach

 Management is a process.
 Emphasizes on management functions and various
concepts and principles involved in performing these
functions.
 Management functions are universal irrespective of the
type of organizational or level of management in an
organization, though there may be differences on
emphasis on a particular function in a particular
organization or at particular level.
 central core of managing - planning, organizing,
staffing, directing and controlling
 Characteristics of
Management
 Management as a continuous process

 It consists of planning, organizing, activating and controlling the

resources (personnel and capital) of an organization.

 None of the managerial functions would produce the ultimate

results in the absence of all other basic functions.

 Management as a discipline

 Its status as a discipline increases because it continuously

discovers many aspects of business enterprises and also passes
on the verified knowledge to the practitioners of the managerial
process.
Characteristics of
Management
 Management as a career:

 Management itself can be regarded as a career, but it also presents a

variety of interesting and challenging careers focused on specialized
occupations in the fields such as marketing, finance and personnel.

 Management as an Applied Science:

 It possesses a systematized body of knowledge and uses scientific

methods of research

 Universal Application:

 Management is a universal activity, applied to any form of activity,

economic or otherwise.
Characteristics of
Management

 Goal Oriented:

 Management has the task of attaining certain objectives. The success or

failure of the management depends on how far it is able to attain the
desired goals. It is judged by the extent to which it achieves its targets.

 Guidance:

 The main task of the management is guidance in the utilization of

material and human resources in the best possible way.

 The essential element of management is that it gets the work done by

coordinating the performance of those who actually perform diverse and
specific jobs.
Characteristics of
Management
 Divorced from proprietorship(Single Owner):

 Management does not signify proprietorship. It refers to a

specialized group of people who have acquired the ability to carry
out a project.

 An activating factor:

 A manager's skill lies in motivating his workers through guidance,

training, incentives, rewards, status, security, control, etc.

 Management is a human activity:

 Management functions are discharged only by individuals. No

corporate body or an artificial being can perform the work of a
management
 Characteristics of
Management
 Management signifies authority:

 Authority is the power to compel others to work and behave

in a particular manner. Management cannot discharge its
function without authority. It is the foundation of
management.

 Leadership:

 The management has to lead a team of workers. It must be

capable of inspiring, motivating and winning their confidence.
Manager

 A manager is someone whose primary

responsibility is to carry out the
management process within an organization
to achieve the organizational goals.
 Functions of management

1
Planning is the process of setting goals, and charting
Planning
the best way of action for achieving the goals. This
function also includes, considering the various steps to
be taken to encourage the necessary levels of change
and innovation.

2 Organizing is the process of allocating and arranging

Organizing
work, authority and resources, to the members of the
organization so that they can successfully execute the
plans.
 Functions of management
3
A: Staffing is the process of filling the positions in the
Staffing
organization and keeping them filled.
B: Staffing is the process of recruiting and selecting the
right person for the right job at the right time in the
right place.
4
Leading involves directing, influencing and motivating
Leading
employees to perform essential tasks. This function
involves display of leadership qualities, different
leadership styles, different influencing powers, with
excellent abilities of communication and motivation.
 Functions of management
5
Controllin Controlling is the process of devising various checks to
g ensure that planned performance is actually achieved.
It involves ensuring that actual activities conform to the
planned activities. Monitoring the financial statements,
checking the cash registers to avoid overdraft etc.,
form part of this process.
Planning

 Think through their goals and actions in advance

 Give the idea about objectives of the organization
 Set the goals for organization and also for
subunits
 Programs are evolved for achieving the goals
 Gives the ideas about the future circumstances.
 Long term and short term plan
Organizing

 Relationships and time are central to organizing

activities
 Organizing produces a structure for the
relationships in an organization.
 Designing an effective organization structure is
not an easy managerial task.
Staffing

 It involves filling, and keep filled, the positions in

the organization structure
 Identifying work-force requirements
 Inventorying the people available- recruiting,
selecting, placing, promoting, appraising, planning
the careers, compensating and training
Leading

 Influencing people so that they will contribute to

the organization
 Effective managers also need to be effective
leaders
 People will follow the leader those who offer a
means of satisfying their own needs.
 It involves motivation, leadership styles and
approaches, and communication.
 Controlling

 Measuring performance against goals and plans.

 Showing where deviations occurs from standards
exist.
 It helps to accomplish the plans
 Measurement of achievement.

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 PLANNIN
G
Plannin Organizin
Staffing Directing Controlling
g g
 PLANNING

 Selection of missions and objectives as well as the

actions to achieve them, which requires decision-
making, that is, choosing a course of action from among
alternatives.
PLANNING
What IS PLANNING…?

 Planning is the process of deciding in advance

what is to be done, where, how and by whom it is
to be done.

 It is basically a process of thinking before acting.

 Planning is a continuous process.

 It is called as the principle of navigational change.

 Decision making is the integral part of planning.

What IS PLANNING…?

 Planning is one of the executive function of the

brain.

 Planning is a key component of the problem

solving skills necessary to achieve the objective.

 It holds the relationship with forecasting.

 The counterpart to planning is spontaneous order.

NATURE OF PLANNING

 Mental activity

 Goal-oriented

 Forward looking

 The primary function

 Based on facts

 Flexible

 Essentially decision making

 Planning and controlling

New plans
No
undesirable
deviations
Controlling:
from plans
Implementatio Comparing
Planning
n of plan plans
With results

Undesirabe
deviation

Corrective
action
Types of plans

 Missions or purposes
 Objectives or goals
 Strategies
 Policies
 Procedures
 Rules
 Programs
 Budgets
Missions or purposes

 The basic purpose or function or tasks of an enterprise or

agency or any part of it.

 A Mission Statement defines the company's business, its

objectives and its approach to reach those objectives

 A mission statement is a statement of the purpose of

company, organization or person, its reason for existing.

 The mission statement should guide the actions of the

organization, spell out its overall goal, provide a path, and
guide decision-making.
Missions or purposes

COMPONENTS
 Key market: Who is your target client or
customer (generalize if needed)?

 Contribution: What product or service do you

provide to that client?

 Distinction: What makes your product or service

unique, so that the client would choose you?
Nit Calicut

 To develop high quality technical education and

personnel with a sound footing on basic
engineering principles, technical and managerial
skills, innovative research capabilities, and
exemplary professional conduct to lead and to use
technology for the progress of mankind, adapting
themselves to changing technological
environment with the highest ethical values as
the inner strength..

 International standing of the highest calibre.

 Purpose, Mission, Vision
104

 When we begin any journey, we subconsciously have an inner

conversation around these three questions:

 Why are we going to a particular

destination? (Purpose)
 How will we get there? (Mission)
 What will it be like when we arrive?
(Vision)

 Mission is vision in action, connecting purpose with the impact to be

made.
 Examples of Higher Purpose 105
(Mackey and Sisodia 2014)

 Disney: To use our imaginations to bring happiness to

millions.

 Johnson & Johnson: To alleviate pain and suffering.

 Google: To organize the world’s information and make it

universally accessible and useful.

 BMW: To enable people to experience the joy of driving.

 American Red Cross: Enabling Americans to perform extra

 106

BBC’s Vision statement: To be the most creative

organisation in the world.
Mission statement: To enrich people’s lives with
programmes and services that inform, educate
and entertain.
Purpose statements:
 Sustaining citizenship and civil society
 Promoting education and learning
 Stimulating creativity and cultural excellence
 Representing the UK, its nations, regions and communities;
 Bringing the UK to the world and the world to the UK;
 Delivering to the public the benefit of emerging communications technologies
and services.
Objectives or goals

 The ends towards which activity is aimed.

 What an organization wants to accomplish in a
future period of time.
 A desired future state an organization wants to
realize.
 Goals are general statement about profitability,
growth and survival of business for a longer
period of time.
 Ends of all the managerial functions
Objectives or goals

 Objectives are desired targets in specific relevant

areas that an organization wants to achieve
during a fixed time period.
 Objectives are concrete , specific and
quantitative.
 Objectives are statement of results, a firm seeks
to achieve during a specified period of time.
Strategies

 The determination of the basic long term

objectives of an enterprise and the adoption of
courses of action and allocation of resources
necessary to achieve these goals.
 The art of working out how to win in business and
life.
 Involves understanding the environment, crafting
a unique and valuable competitive position, and
using the resources in such a way that the best
use of the opportunities are made.
Policies

 General statements or understandings that guide

or channel thinking in decision making.
 Define an area within which a decision is to be
made and ensure that that the decision will be
consistent with and contribute to an objective.
 Every policy statement must be definite, clear and
easily understandable.
 Discretions are applicable.
Procedures

 Plans that establish a required method of handling

future activities.
 They are guide to action, rather than to thinking.
 Chronological sequences of required actions.
 May be inter-departmental.
 A procedure has to be consistent with the
objectives and within the broad areas of a policy.
Procedures and policies

 Example: granting employee vacations.

Rules

 Spell out specific required actions or non-actions

allowing no discretion.
 A rule is different from a policy, procedure or
method.
 Example: Traffic rules, Exam rules.
Programmes

 A complex of goals, policies, procedures, rules,

task assignments, steps to be taken, resources to
be employed, and other elements necessary to
carry out a given course of action.
 Programs are precise plans or definite steps in
proper sequence which need to be taken to
discharge a given task.
 The essential ingredients of every program are
time phasing and budgeting.
Budgets

 A statement of expected results expressed in

numerical terms.
 A quantified plan.
 May be expressed in: financial terms, labor-hours,
units of product, machine hours etc.,
 Acts as a control device.
 A fundamental planning instrument.
 Forces a company to make in advance- whether for a
week or for five years- a numerical compilation of
expected cash flow, expenses and revenues, capital
outlays, labor or machine-hour utilization.
Steps in planning

Being
Setting Considerin
aware of
objectives g planning
opportunit
or goals premises
y
Comparing
Identifying
alternative
alternative
s in light
s
of goals
Formulatin Quantifying
Choosing
g plans by
an
supporting making
alternative
plans budgets
 Being aware of
“ opportunity

In light of:
The market
Competition
What consumers want
Strengths
Weaknesses
”
Pre-planning process
Internal and external opportunities
Helps to set the objectives
“ Setting objectives or
goals
Where we want to be and what we

”
want to accomplish

For entire enterprise and the subordinate work units

Long term and short term
Give direction to the major plans
Form a hierarchy
 “ Considering planning
premises
In what environment- internal or

”
external –will our plans operate.?

Premises: Assumptions about the environment in which the plan

is to be carried out

Principle of planning premises: the more thoroughly

individuals charged with planning understand and agree to utilize
consistent planning premises, the more coordinated enterprise
planning will be.
“ Identifying
alternatives
What are the most promising
alternatives to accomplish our
objectives.?
”
Reduce the number of alternatives
Mathematical techniques and computer can be used
 Comparing
“ alternatives in light of
goals
Which alternative will give us the
best chance of meeting our goals
at the lowest cost and highest
profit.? ”
Evaluate the strong and weak points.
“ Choosing an
alternative
Selecting the course of action we

”
will pursue.

Adoption of the plan.

It is decision making.
 Formulating supporting
“ plans
Such plans are to:
Buy equipment
Buy materials

”
Hire and train workers
Develop a new product
 Quantifying plans by
“ making Budgets

Develop such budget as:

Volume and price of sales
Operating expenses necessary for
plans
Expenditures for capital equipment ”
Sum total of income and expenses, with resultant profit or surplus,
and budgets of major balance sheet items like cash and capital
expenditures.