Tag: Roles and Skills

Management – Concept, Process, Theories and Approaches, Roles and Skills

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1. Meaning and Nature of Management

Definition:
Management is the process of planning, organizing, leading, and controlling organizational activities to achieve predetermined goals effectively and efficiently.

Nature / Characteristics:

1. Goal-Oriented – focuses on achieving organizational objectives.

2. Continuous Process – management is ongoing at all levels.

3. Universal – applicable in all types of organizations.

4. Integrative Force – unites efforts of individuals.

5. Dynamic Function – adapts to changes in environment.

6. Multidisciplinary – draws knowledge from economics, psychology, sociology, etc.

7. Group Activity – always done through people.

Levels of Management:

1. Top Level – Policy making (Board, CEO, MD).

2. Middle Level – Interprets policies and coordinates (Department Heads).

3. Lower Level – Supervisory, day-to-day control (Supervisors, Foremen).

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2. Process of Management

The management process involves a series of interrelated functions:

1. Planning: Setting objectives and deciding the future course of action.

2. Organizing: Arranging resources and activities to implement plans.

3. Staffing: Recruiting, training, and developing human resources.

4. Directing: Guiding, motivating, and leading subordinates.

5. Coordinating: Integrating efforts of different departments.

6. Controlling: Measuring performance and taking corrective actions.

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3. Theories and Approaches of Management

A. Classical Approach

1. Scientific Management (F.W. Taylor):

   • Emphasizes efficiency through scientific methods.

   • Principles:

     • Science, not rule of thumb

     • Harmony, not discord

     • Cooperation, not individualism

     • Development of each worker to greatest efficiency

   • Tools: Time and motion study, standardization, differential wage system.

2. Administrative Management (Henri Fayol):

   • Focused on management functions.

   • 14 Principles: Division of work, Authority, Discipline, Unity of Command, Unity of Direction, Subordination of individual interest, Remuneration, Centralization, Scalar Chain, Order, Equity, Stability of Tenure, Initiative, Esprit de Corps.

3. Bureaucratic Approach (Max Weber):

   • Focused on structured hierarchy, formal rules, and merit-based promotion.

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B. Neo-Classical Approach

• Human Relations Approach (Elton Mayo – Hawthorne Studies):
  Emphasized the role of social factors, teamwork, and motivation in productivity.
  Recognized informal groups and worker satisfaction.

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C. Modern Approaches

1. Systems Approach: Organization as an open system interacting with its environment.

2. Contingency Approach: “It depends” – management style depends on situation.

3. Quantitative Approach: Use of mathematical models and statistics for decision-making.

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4. Management Roles and Skills

A. Mintzberg’s Managerial Roles

B. Managerial Skills (Katz)

1. Technical Skills – Knowledge of specific tools and techniques.

2. Human Skills – Ability to work effectively with people.

3. Conceptual Skills – Ability to view the organization as a whole.

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5. Management Functions (Detailed)

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6. Communication

Definition: Process of transmitting information, ideas, and understanding from one person to another.

Types of Communication:

• Formal and Informal

• Upward, Downward, Horizontal, Diagonal

• Verbal, Non-verbal, and Written

Communication Process:
Sender → Message → Channel → Receiver → Feedback → Noise

Barriers:

• Physical (noise, distance)

• Semantic (language issues)

• Psychological (attitudes, emotions)

• Organizational (hierarchy, authority gaps)

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7. Decision Making – Concept, Process, Techniques and Tools

Concept:

Decision making is the selection of the best alternative from available options.

Process:

1. Identify problem

2. Analyze situation

3. Generate alternatives

4. Evaluate alternatives

5. Choose the best option

6. Implement the decision

7. Review and feedback

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A. Techniques of Decision Making

1. Qualitative Techniques

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2. Quantitative Techniques

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B. Tools of Decision Making

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Conditions of Decision Making

1. Certainty: Outcomes are known.

2. Risk: Probabilities of outcomes known.

3. Uncertainty: No information about probabilities.

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Common Decision-Making Errors:

• Overconfidence Bias

• Anchoring Bias

• Confirmation Bias

• Escalation of Commitment

• Availability Bias

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8. Organisation Structure and Design

Meaning:
The framework that defines roles, responsibilities, authority relationships, and communication channels.

Types of Structures:

1. Line Structure: Simple, authority flows top to bottom.

2. Functional Structure: Based on specialization (e.g., HR, Finance).

3. Line and Staff Structure: Combines authority and expert advice.

4. Matrix Structure: Dual authority (project + function).

5. Project and Network Structures: Temporary, flexible structures for innovation.

Key Concepts:

• Authority: Legal right to command.

• Responsibility: Obligation to perform assigned duties.

• Delegation: Assigning authority to subordinates.

• Centralization: Decision-making at top level.

• Decentralization: Decision-making distributed.

• Span of Control: Number of subordinates under one manager.

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9. Managerial Economics

Meaning:
Application of economic principles to solve managerial problems and improve decision-making.

Importance:

• Demand forecasting

• Pricing decisions

• Production and cost analysis

• Profit management

• Capital budgeting

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10. Demand Analysis

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11. Market Structures

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12. National Income

Concepts:

• GDP: Value of goods/services within a country.

• GNP: GDP + income from abroad – income to foreigners.

• NNP, NDP, PCI: Derived measures.

Measurement Methods:

1. Product Method

2. Income Method

3. Expenditure Method

Difficulties: Non-monetary output, double counting, informal sector.

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13. Inflation

Meaning: Continuous rise in the general price level.

Types:

• Demand-pull

• Cost-push

• Creeping, Walking, Galloping, Hyper

Measurement:

• CPI (Consumer Price Index)

• WPI (Wholesale Price Index)

• GDP Deflator

Effects:

• Reduces purchasing power

• Hurts fixed income groups

• Encourages speculation

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14. Business Ethics and CSR

Business Ethics:

Set of moral principles guiding business behavior.

Importance: Builds trust, reputation, and long-term success.

Corporate Social Responsibility (CSR):

Company’s responsibility toward society beyond profit-making.

Carroll’s Model:

1. Economic

2. Legal

3. Ethical

4. Philanthropic responsibilities

Ethical Dilemmas: Conflict between profit and moral principles.

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15. Corporate Governance

Meaning: System of rules, practices, and processes by which a firm is directed and controlled.

Principles:
Transparency – Accountability – Fairness – Responsibility

Mechanisms:

• Board of Directors

• Audit Committees

• Independent Directors

• SEBI Guidelines

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16. Value-Based Organisation

Definition:
An organization guided by shared ethical values such as trust, honesty, and transparency.

Benefits:

• Strong culture

• Employee commitment

• Customer loyalty

• Long-term sustainability