Principles of Management: Introduction

WHAT IS ORGANIZATION AND MANAGEMENT?

An organization is a group of people working together in a structured and coordinated fashion to
achieve a set of goals. (Ricky W. Griffin, Management 7th Edition, Houghton Mifflin Book Company, Boston, USA)

Organization is a systematic arrangement of people to accomplish some specific purpose.

(Stephen P. Robbins and Mary Coulter, Management, 5th Edition, Prentice Hall of India Ltd)

Organization implies a formalized intentional structure of roles or positions. (Heinz Weihrich and
Harold Koontz, Management: A Global Perspective, 11th Edition, Tata McGraw-Hill Book Company, India.)

An organization is a group of two or more people that exists and operates to

achieve clearly stated, commonly held objectives. (Straub and Attner, Introduction to
Business, Kent publishing, 2004.p. 9109.)

From the above definitions it is clear to us that people create organizations to help achieved some pre
-specific objectives or purposes.

WHAT IS MANAGEMENT?
Some people define management as managing people tactfully. People are the most valuable resources
used by any organization. Others defined it as getting things done throughout the effort of other people.
Here we are citing some definitions of eminent writers on management:

Management is the process aimed at accomplishing organizational objectives by: I) effectively

coordinating the procurement, allocation, and utilization of human, physical resources of the
organization; and 2) maintaining the organization in a state of dynamic equilibrium with the
environment. This definition plays important on two aspects namely, coordinating among different
resources and maintaining harmony with the environment in which the organization is continuing its
operations.( Arvind V. Phatak, International; Dimensions of Management, The Kent International
Business Series, PWS-KENT PUBLISHING COMPANY, BOSTON, USA)

Management is the process of efficiently getting activities completed with and through other people.
The management process includes the planning, organizing, leading and controlling activities that take
place to accomplish objectives (David A. DeCenzo and Stephen P. Robbins, Personnel/HRM 3rd Ed,
Prentice-hall of India).

Management can be defined as a set of activities (including planning and decision making, organizing,
leading, and controlling) directed at an organization’s resources (human, financial, physical and
information) with the aim of achieving organizational goals in an efficient and effective manner. (Ricky
W. Griffin, Management, 7th Edition, Houghton Mifflin Book Company , Boston, USA)

The term management refers to the process of getting activities completed efficiently and effectively
with and through other people. (Stephen P. Robbins and Mary Coulter, Management, 5th Edition, Prentice Hall of
India Ltd)

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Management is the process undertaken by one or more individuals to coordinate the activities of others
to achieve results not possible by one individual acting alone. (DONNELY, GIBSON, IVANCRVICH,
MANAGEMENT)

Management is the process of working with and through others to achieve organizational objectives in a
changing environment. Central to this process is the effective and efficient use of limited resource. Five
components of this definition requires close examination: 1) working with and through others, 2)
achieving organizational objectives, 3) balancing effectiveness and efficiency, 4) making the most of
limited resources and 5) coping with a changing environment (ROBERT KRETNER, Management, 7th Edition,
A.I.T.B.S. PUBLISHERS AND DISTYRIBUTORS, NEW DELHI, INDIA)

Management is the process of designing and maintaining an environment in which individuals, working
together in groups, efficiently accomplish selected aims.( (Heinz Weihrich and Harold Koontz, Management:
A Global Perspective, 11th Edition, Tata McGraw-Hill Book Company, India)

The basic definition needs to be expanded:

• As managers, people carry out the managerial functions of planning,
organizing, staffing, leading and controlling.
• Management applies to any kind of organization.
• It 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.

PRODUCTIVITY, EFFICIENCY AND EFFECTIVENESS:

What is Productivity?
In a general sense, productivity is an economic measurer of efficiency that summarizers the value of
outputs relative to the value of the inputs used to create them. Productivity can be and often is assessed
at different levels and in different forms. Successful companies create a surplus through productive
operations. Although there is no complete argument on the true meaning of productivity, let us define it
as the input-output ratio within a time period with due consideration for quality. Productivity is a
measure of how much value individual employees add to the goods or services that the organization
produces. The greater the output per individual, the higher the organization’s productivity. (Louis R.
Gomez-Mejia and others, Managing Human Resources, Prentice Hall India, 3rd Edition, New Delhi.)

Productivity is doing more with less. ( Michael Le Boeuf, The Productivity Challenge ( New York:
McGraw-Hill, 1982), p.8

Productivity is the efficiency with which outputs are produced-the ration of output to input.( Charles E.
Craig, and R. Clark Harris, “Total Productivity at the Firm Level,” Sloan Management Review,
Spring1973,pp.13-19.

Productivity designates how efficiently a business uses its resources. Le Boeuf, Productivity
Challenges, pp.9-10.)

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Productivity can be defined in simple terms as any ratio of output to one or more corresponding inputs.
The unit of output can be anything-dollars, units of products, customers served, patient treated or
whatever is meaningful to the job or organization. (Ivancevich & others, Fundamentals of
Management, fifth edition, p.49)

Productivity can be expressed as follows:

Productivity =Output/Input (with a time period, quality considered)

This formula indicates that productivity can be improved a) by increasing outputs with the same inputs,
b) by decreasing inputs but maintaining the same output, or c) by increasing output and decreasing
inputs such as labor, materials, and capital. Total factor productivity combines various inputs to arrive
at a composite input. In the past, productivity improvement program were mostly aimed at the worker
level. Yet, as P. F. Drucker, one of the most prolific writers in management observed, “ The greatest
opportunity for increasing productivity is surely to be found in knowledge work itself and especially in
management.”

WHAT IS EFFICIENCY AND EFFECTIVENESS?

Efficiency is a vital part of management. It refers to the relationship between inputs and outputs. If you
can get more outputs from the given inputs, you have increased efficiency. Since managers deal
with input resources that are scarce-mainly people, money, and equipment –they are concerned
with efficient use of these resources. Management, therefore, is concerned with minimizing
resource costs. Efficiency refers to as “doing things right.”

However, it is not enough simply to be efficient. Management is also concerned with getting activities
completed; that is, it seeks effectiveness. When managers achieve their organization’s goals, we say
they are effective. Effectiveness can be described to as “ doing the right things.” So efficiency is
concerned with means and effectiveness with ends.

By efficient, we mean using resource wisely and in a cost-effective manner. For example, if a
corporation like Square Pharmaceutical can produce high quality drugs at relatively low cost it is
efficient.

By effective, we mean making the right decisions and successfully implementing them. If a firm can
produce high quality product that are inspired by customers is effective.

Effectiveness entails promptly achieving a stated objective. While, efficiency, enters the picture when
resources required to achieve an objective are weighted against what was actually accomplished. The
more favorable the ration of benefits to costs, the greater the efficiency. (ROBERT KRETNER,
Management, 7th Edition, A.I.T.B.S. PUBLISHERS AND DISTYRIBUTORS, NEW DELHI, INDIA)

Efficiency denotes most effective use of society’s resource in satisfying people want and needs.
( Samuelson)

Effectiveness denotes right use of society’s resources. ( Samuelson)

Effectiveness refers to the achievement of objectives.

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 Effectiveness is achieving objectives (ends) with the least amount of resources.

Efficiency and effectiveness are interrelated. For instance, it is easier to be effective if one ignores
efficiency. A company can produce more accurate and attractive products if it disregarded labor and
material input costs. In Bangladesh, we often criticize our bureaucrats on the ground that they are
effective but extremely inefficient; that is, they get their jobs done but at a very high cost. Management
is concerned, then, not only with getting activities completed but also with doing so as efficiently as
possible.

Organizations, on the other hand, can be efficient but not effective. By doing the wrong things well an
organization can be efficient. Many private universities in Bangladesh have become highly efficient in
processing students. By using computer-assisted learning, large lecture classes, and heavy reliance on
part time faculty, administrators have significantly cut the cost of educating each student. But the
quality of the students after graduating from these private universities is not beyond question. Of course,
high efficiency is associated more typically with high effectiveness. And poor management is often due
to both inefficiency and ineffectiveness. Or to effectiveness achieved through inefficiency.

In general, successful organizations are both efficient and effective.

Managerial Functions:

The function of managers provides a useful structure for organizing management knowledge.
Managerial functions are general administrative duties that need to be carried out in virtually all
productive organizations. Many management writers defined management from the context of functions
performed by managers. Henri Fayol, a French industrialist turned writer, became the father of the
functional approach in 1916 when he identified five managerial functions: planning, organizing,
command, coordination and control. Fayol claimed that these five functions were the common
denominators of all managerial jobs, whatever the purpose of the organization. Later on management
scholars classified managerial functions from their won point of views. ROBERT KRETNER,
identified eight functions as managerial functions and these are:

PLANNING: Commonly referred to as the primary management function, planning is the

formulation of future courses of action. Plans and objectives on which they based give purpose and
direction to the organization, its subunits, and contributing individuals. Planning involves selecting
missions and objectives as well as the actions to achieve them; it requires decision making, that is,
choosing future courses of action from among alternatives.

DECISION MAKING: Managers choose among alternative courses of action when they make
decisions. Making intelligent and ethical decisions in today’s complex world is a major management
challenge.

ORGANIZING: Structural considerations such as the chain of command, division of labor, and
assignment of responsibility are part of the organizing function. Careful organizing helps ensure the
efficient use of human resources. Organizing is that part of managing which involves establishing an
international structure of roles for people to fill in an organization.

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 STAFFING: Organizations are only as good as the people in them. Staffing consists of recruiting,
training, and developing people who can contribute to the organized effort. Stffing involves filling and
keeping filled, the positions in the organization structure.

COMMUNICATING: Today’s managers are responsible for communicating to their employees the
technical knowledge, instructions, rules and information required to get the job done. Recognizing that
communication is two-way process, managers should be responsive to feedback and upward
communications.

MOTIVATING: An important aspect of management today is motivating individuals to pursue

collective objectives by satisfying needs and meeting expectations with meaningful work and valued
rewards.

LEADING: Managers become inspiring leaders by serving as role models and adapting their
management styles to the demands of the situation. The idea of visionary leadership is popular today.
Leading is the influencing people so that they will contribute to organizational and group goals; it has to
do predominantly with interpersonal aspect of managing.

CONTROLLING: When managers compare desired results with actual results and take necessary
corrective action, they are keeping on track through the control function. Deviations from the past plans
should be considered when formulating new plans. Controlling is measuring and correcting individual
and organizational performance to ensure that events conform to plans.

Coordination, the Essence of Managership:

Some authorities consider coordination to be a separate function of the manager. It seems more
accurate, however, to regard it as the essence of managership; for achieving harmony among individual
efforts toward the accomplishment of group goals. Each of the managerial function is an exercise
contributing to coordination.

Even in the case of a church or a fraternal organization, individuals often interpret similar interest in
different ways, and their efforts toward mutual goals do not automatically mesh with the efforts of
others. It thus becomes the central task of the manager to reconcile differences in approach, timing,
effort, or interest and to harmonize individual goals to contribute organizational goals.

BASIC MANAGERIAL ROLES:

Regardless of their level or area within an organization, all managers must play certain roles if they are
to be successful. The concept of a role, in this sense, is similar to the role an actor play in a theatrical
production. A person does certain things; meet certain needs in the organization and has certain
responsibilities. To run an organization whatever the type may be, in a effective and efficient manner
they must play certain roles in their respective organizations. Some people defined role, as “A role is a
set of expectations of manager’s behavior.” Robbins defined roles as specific categories of managerial
behavior. While SKINNER defined role as a set of expected behaviors. Attner on the other hand defined
role, as “A role is any of several behaviors a manager displays as he or she functions in the
organization.”

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In the late1960s, Henry Mintzberg of McGill University did a careful study of five chief executives in
work. He closely observed the day-to-day activities of a group of CEOs by literally following them
around and taking notes on what they did. From this observation Mintzberg concluded that managers
play ten different but highly interrelated roles and these roles fall into three basic categories:
interpersonal, informational and decisional. The basic managerial roles are shown in the following
table:

Category Role Sample activities

Interpersonal Figurehead Attending ribbon-cutting ceremony for new plant
Leader Encouraging employees to improve productivity
Liaison Coordinating activities of two projects groups
Informationa Monitor Scanning industry reports to stay abreast of
l developments
Disseminator Sending memos outlining new organizational initiatives
Making a speech to discuss growth plans
Spokesperson
Decisional Entrepreneur Developing new ideas for innovation
Disturbance handler Resolving conflicts between two subordinates
Resource allocator Reviewing and revising budget requests
Negotiator Reaching agreement with a key supplier or labor union

Table: Ten Basic Managerial Roles, Research by Henry Mintzberg.

Interpersonal Roles:
All managers are required to perform duties that are ceremonial and symbolic in nature-interpersonal
roles. When the president of a college hands out diplomas at commencement, he or she is acting in a
figurehead role. All managers have leader roles. Because, all managers are also leaders. This role
includes hiring, training, motivating and disciplining employees. The third role is liaison role. In the
word of Mintzberg, this role implies contacting external sources who provide the manager with
information.

Informational Role:
All managers, to some degree, fulfill informational roles -receiving and collecting information from
organizations and institutions outside their own. The informational role typically flows from
interpersonal role. The first informational role is that of monitor, one who actively seeks information
that may be of value. The manager is also a disseminator of information, transmitting relevant
information back to others in the workplace. When they represent the organization to outsiders,
managers also perform a spokesperson role. For example, a plant manager of ACME Pharmaceuticals
when transmits information to ACME head office executives so that they will be better informed about
the activities of the plant’s activities.

Decisional Roles:
Sometimes it is said that management means decision -making. Managers have to make choices from
different alternatives available to hum/her, which will best fit the organization. As entrepreneurs,
managers initiate and oversee projects that will improve their organization’s performance. As
entrepreneur managers have to initiate change. As disturbance handler, managers take corrective action

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in response to previously unforeseen problems. Managers are required to handle such problems as
strikes, copyright infringements, or problems in public relations or corporate image. As resource
allocator, managers are responsible for allocating human, physical, and monetary resources. Managers
decide how resources are distributed, and with whom he or she will work most closely. Last, managers
perform a negotiator role when they discuss and bargain with other groups to gain advantages for their
own units. In this role, managers enter into negotiation with other groups or organizations as a
representative of the company. These include a union contract, an agreement with a consultant, or a
long- term relationship with a supplier.

MANAGEMENT SKILLS:
Skills allow individuals to perform activities and to function in society. A management skill is the
ability to use knowledge, behaviors and training, and aptitudes to performing a task (SKINNER &
IVANCEVICH: 1992). During the early 1970s, research by Robert L. Katz found that managers need
three essential skills or competencies: technical, human and conceptual. In addition to fulfilling
numerous roles, mangers also need a number of specific skills if they are to succeed. The most
fundamental management skills are technical, interpersonal, conceptual, diagnostic, communication,
decision-making, and time management skills.

Technical Skills:
Technical skills include knowledge about methods, processes and equipments for conducting the
specialized activities of the manager’s organizational unit. Technical skills also include factual
knowledge about the organization (rules, structure, management systems, employee characteristics) and
knowledge about the organization’s products and services (technical specifications, strengths, and
limitations). This type of knowledge is acquired by a combination of formal education, training, and job
experience. Effective managers are able to obtain information and ideas from many sources and store it
away in their memory for use when they need it.

Technical skills are those involved in making a product or providing a service (SKINNER &
IVANCEVICH: 1992). Technical skill is the knowledge of and ability to use the processes, practices,
techniques, or tools of a specialty responsibility area. (Straub and Attner, Introduction to Business,
Kent publishing, 2004.p. 96.) Technical skills are necessary to accomplish or understand the specific
kind of work being done in an organization. Technical skills are especially important for first line
managers. The managers spend much of their time training subordinates and answering questions about
work-related problems. They must know how to perform the tasks assigned to those they supervise if
they are to be effective managers. Technical skill refers to a person’s knowledge and ability in any type
of process or technique. Examples are the skills learned by accountants, Engineers, Word Processing
operators and toolmakers.

Human Skills/Interpersonal skills:

Interpersonal skills (or social) skills include knowledge about human behavior and group processes,
ability to understand the feelings, attitudes, and motives of others and ability to communicate clearly
and persuasively. Specific types of interpersonal skills such as apathy, social insight, charm, tact, and
diplomacy, persuasiveness and oral communication ability are essential to develop and maintain
cooperative relationships with subordinates, superiors, peers, and outsiders. Someone who understands
people and is charming, tactful, and diplomatic will have more cooperative relationship than a person
who is insensitive and offensive.

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Human relations skills involve relating and interacting with subordinates, peers, superiors, and customers or
clients (SKINNER & IVANCEVICH: 1992). Human skill is the ability to interact with other persons
successfully. A manager must be able to understand, work with and relate both individuals and groups to build a
teamwork environment. (Straub and Attner, Introduction to Business, Kent publishing, 2004.p. 97.)
Human skill is the ability to work effectively withy people and to build teamwork. In the other words it is the
ability of a person to work well with other people both individually and in groups. Since managers deal with
people, this skill is crucial. Managers have to spend considerable time interacting with people both inside and
outside the organization. For obvious reasons, then, managers also need interpersonal skill –the ability to
communicate with, understand and motivate both individuals and groups.

Conceptual Skills:
In general terms, conceptual (or cognitive) skills involve good judgment, foresight, intuition, creativity, and the
ability to find meaning and order in ambiguous, uncertain events. Specific conceptual skills that can be measured
with aptitude test include analytical ability, logical thinking, concept formation, inductive reasoning, and
deductive reasoning.

Conceptual skills are the managers’ ability to organize and integrate information to better understand the
organization as a whole (SKINNER & IVANCEVICH: 1992). Conceptual skill deals with ideas and
abstract relationships. It is the mental ability to view the organization as a whole and to see how the
parts of the organization relate to and depend on one another. In addition, conceptual skill is the ability
to imagine the integration and coordination of the parts of an organization- all it processes and systems.
(Straub and Attner, Introduction to Business, Kent publishing, 2004.p. 97.)Conceptual skills depend
on the manager’s ability to think in the abstract. They must be able to see the organization as a whole and the
relationships among its various subunits and to visualize how the organization fits into broader environment.
Conceptual skill is the ability to think in terms of models, frameworks, and broad relationships, such as long-
range plans. These conceptual skills allow managers to think strategically, to see the ‘big picture”, and to make
broad-based decisions that serve the organization. These types of conceptual skills are needed by all managers at
all levels but become more important as they move up the organizational hierarchy.

Diagnostic Skills:
Successful managers also posses diagnostic skills or skills that enable a manager to visualize the most appropriate
response to a situation. This skill is as like the skill of a physician who diagnoses a patient’s illness by analyzing
symptoms and determining their probable causes.

Communication Skills:
Communication skill is now a day considered to be an important skill of successful managers. Communication
skills refer to the manager’s abilities both to convey ideas and information effectively to others and to receive
ideas and information effectively from others. These skills enable a manager to transmit ideas to subordinates so
that they know what is expected, to coordinate work with peers and colleagues so that they work together
properly, and to keep higher -level managers informed about what is going on.

Decision-Making Skills:
Management means decision-making. Decision-making skills refer to the manager’s ability to recognize
and define problems and opportunities correctly and then to select an appropriate course of action to
solve problems and capitalize on opportunities. No managers make right decision all the time. However,
effective managers make good decisions most of the time. And when they do make a bad decision, they
usually recognize their mistake quickly and then make good decisions to recover with as little cost or
damage to their organization as possible.

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 Time Management Skills:
Finally, effective managers usually have good time management skills. Time management skills refer to
the manager’s ability to prioritize work, to work efficiently, and to delegate appropriately. Managers,
work with different pressures and challenges. So, managers need to use their time effectively in order to
run their organizations in an effective manner.

Managerial Skills and Organizational Hierarchy:

Managers need many types of skills to fulfill their role requirements, but the relative importance of the
various skills depends on the leadership situation. Relevant situational moderator variables include
managerial level, type of organization, and the nature of the external environment. Robert L. Katz
identified three kinds of skills for administrators. These skills are prerequisites for successfully running
an organization. But the relative importance of these skills is not equally important for all levels of
managers in the organizational hierarchy. Basically, we find three levels in an organization: top, middle
and lower. The relative importance of these skills for managers is discussed below:

Figure :

One aspect of the situation influencing skill importance is a manager’s position in the authority
hierarchy of the organization. Skills priorities at different levels of management are related to differing
role requirement at each level. Managerial level affects not only the relative importance of the three
broad categories of skills described earlier, but also the relative importance of the specific types of skills
within each category.

In general, higher levels of management have a greater number and variety of activities to be
coordinated, the complexity of relationship that need to be understood and managed is greater, and the
problems that need to be solved are more unique and ill-defined. Whereas a department supervisor may
have to coordinate the work of employees with mostly similar jobs, a CEO must coordinate the diverse
activities of several organizational units, each with large number of people. Increasing complexity as
one ascends to higher levels in an organization is reflected in increased requirements for conceptual
skills. Top executives need to analyze vast amounts of ambiguous and contradictory information about
the environment in order to make strategic decisions and to interpret events for other members of the
organizations. Executives need to have a long-term perspective and the ability to comprehend complex
relationships among variables relevant to the performance of the organization. A top executive must be
able to anticipate future events and know how to plan for them. The quality of strategic decisions
ultimately depends on conceptual skills, even though some technical knowledge is necessary to make
the decisions, and interpersonal skills are necessary for developing relationships, obtaining information,
and influencing subordinates to implement decisions.

The role of middle-level managers is primarily one of supplementing existing structure and developing
ways to implement policies and goals established at higher levels. This role requires a roughly equal
mix of technical, interpersonal, and conceptual skills. Low-level managers are mainly responsible for

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implementing po9licy and maintaining the workflow within the existing organizational structure; for
these managers, technical skills are relatively more important than conceptual skills or interpersonal
skills.

The skill requirements for managers at each level vary somewhat depending on the type of organization,
its size, the organization structure, and the degree of centralization of authority. For example, technical
skills are more important for top executives in organizations where operating decisions are highly
centralized. Likewise, more technical skill is needed by top executives who have functionally
specialized roles (e.g., selling to key customers, product design) in addition to general administrative
responsibilities. More conceptual skills are needed by middle-and lower-level managers who are
expected to participate in strategic planning, product innovation, and leading change.

The relative importance of these skills may differ at various levels in the organization hierarchy.
Technical skills are of greatest importance at the supervisory level. Because they have to train
subordinates and answer the questions as raised by the employees in the workplace. They spend most of
their time with the employees. Although, technical skills become less important as managers move into
higher levels of management, even top managers need some proficiency in technical aspects of the
organization. Technical skills often help top-level managers to run the organization effectively. For
example: Horst Schulze, the CEO of Ritz-Carlton, started his career as a dishwasher and other related
jobs. But these skills helped him to become the CEO of Ritz-Carlton, the top of the industry. Human
skills-the ability to communicate, understand and motivate both individuals and groups. A manager who
has good interpersonal skills is likely to be more successful. The skill is equally important for all levels
in the organization hierarchy. Conceptual skill depends on manager’s ability to think in the abstract.
Conceptual skill is needed by all managers but is especially important for top-level managers in the
organization. It is assumed, especially in large companies, that chief executive officers (CEO) can
utilize the technical abilities of their subordinates. In smaller firms, however, technical experience may
still be quite important.

TRANSFERABILITY OF SKILLS ACROSS ORGANIZATIONS.

An interesting question about managerial skills is the extent to which they are transferable from one
type of organization to another. Writers generally agree that lower level managers cannot easily transfer
to a different functional specialty (e.g., from sales manager to engineering manager), because the
technical skills needed at this level of management are so different across organizations. However, less
agreement is evident about the transferability of skills across organizations at executive level

Katz (1955) proposed that top-managers with ample human relations and conceptual skills can be
shifted from one industry to another with great ease and no loss of effectiveness. Some other writers
contend that the transferability of skills for top executive is limited due to variations in ownership,
traditions, organizational climate, and culture. Different industries have unique economic, market, and
technological characteristics. Familiarity with technical matters, products, personalities, and traditions is
a type of knowledge that is acquired only through long experience in the organization. Only the general
components of conceptual and technical skills can be used in a different situation. Moreover, an
executive who moves to a different industry must develop a network of external contact, whereas the
old network would still be relevant for a move to another organization in the same industry. In general,
it seems to be more difficult for an executive to make a successful transition to a different industry or
type of organization, especially if the new position requires extensive technical expertise and an
extensive network of external contacts.

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 Levels of Management:

Who is a manager?
A manager is someone who works with and through other people by coordinating their work activities
in order to accomplish organizational goals. That may mean coordinating the work of a departmental
group, or it may mean supervising a single person. It could involve coordination the work activities of a
team composed of people from several different departments or even people outside the organization
such as temporary employees or employees who work for the organization’s suppliers. Keep in mind,
also, that managers may have other work duties not related to coordinating and integrating of others.
For example, an insurance claims supervisor may also process claims in addition to coordinating the
work activities of other claims clerks.
Managers are people who are in charge of others and are responsible for timely and correct execution of
actions that promote their units’ successful performance. As enterprises grow from an owner to a group
of to a corporation, a number of managerial levels are created and they begin to take on a shape. Three
distinct levels of management –executive, middle, and first-line –are usually portrayed as a managerial
hierarchy. Thus, hierarchy depicts what is called a chain of command, or simply a channel of
communication, coordination, and control. The first-line manager reports to a middle-line manager, who
reports to an executive level manager.

FIG:

EXECUTIVE/Top Managers:

At or near the top of the organization are the top managers, who are responsible for making
organization-wide decisions and establishing the plans and goals that affect the entire organization.
These individuals typically have titles such as executive vice president, president, managing director,
chief operating officer, chief executive officer, or chairman of the board.
As the top of management pyramid sits the president or chief executive officer and other managers
engaged primarily in charting the overall mission, strategy, and objectives of the business. They
function externally for the business and are important spokes person for everything the company is
attempting to accomplish.

MIDDLE Managers:
Middle managers include all levels of management between the first-line level and the top level of the
organization. These managers manage the work of first line managers and may have titles such as
department head, project leader, plant manager, or division managers. The middle level of the
management hierarchy includes plant supervisors, college deans, project directors, and regional sales
coordinators. These managers receive the broad overall strategies, mission, and objectives from
executive-level managers and translate them into specific action programs. The emphasis is on
implementing the broad organizational plans. Basically, the middle manager is a conduit between the
top policy makers and the supervisory personnel responsible for producing and /or services so that the
company achieves its objectives.

FIRST-LINE:

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First line managers are the lowest level of management and manage the work of non-managerial
individuals who are involved with the production or creation of the organization’s products. They’re
often called supervisors, but may also be called line managers, office managers or even foreman. The
third level of management, the first-line or supervisory level is directly responsible for the minute
details needed to coordinate the work of nonmanagers. Supervisors must work directly with employees
and motivate them to perform satisfactorily. The supervisor in a factory, the departmental chairperson in
a university, and the product manager in a marketing department must translate overall corporate goals
into plans. This management level is the link between managers and non-managers. Organizational
objectives eventually meet the test of reality at the supervisory level.

Managers at Different Organizational Levels in Three Types of Organizations.

Type of Business Organization Educational Government
Organization/Level of Institution Organization
Management
Top level Managing Director President Cabinet Secretary
Middle level Vice President Commissioner
Divisional Managers Dean Division Director
First level Supervisor, foreman Department Program manager
Chairperson
* Different organizations use various terms to identify managers at different
organizational levels

The cornerstone that separates the three levels of managers from non-mangers is decision making. Managers at
any level, performing any managerial function and applying any managerial principle, must make decisions.
Executive-level managers must determine the overall direction of the company. The middle manager must decide
how to implement the overall plan at the supervisory level: How should the plan be communicated? How should
supervisors be motivated? When should the supervisor be informed about the overall plans? The first-line
supervisors must decide how to motivate employees and reward the best performance.

Principles:
Henri Fayol, a Frenchman, was one of the first writers to introduce the ideas of principles of
management. A principle is defined as ‘ a fundamental, primary, or general truth, on which other truths
depend.
A principle can be defined as a fundamental statement or truth providing a guide to thought or action.
Principles in management are fundamental truth (or what thought to be truth in a given time),
explaining relationship between two or more set of variables, usually an independent variable and a
dependent variable.

A Principle may be defined as a fundamental statement or truth providing a guide to thought or action.
They are guide to action. They are basic but not absolute. They are working hypotheses that are
reasonably well established, accepted and used in many successful organizations. As more research is
conducted, new principles will emerge, other management principles will be modified, and some will be
discarded as not truly representative of management practice today.

A good management principle should be a) practical, which means they can be applied almost any time
in the organization’s life and be appropriate, b) relevant to the broad forms of organization structure, c)
consistent in that for similar sets of circumstances, similar results will occur and d) flexible in that their
application should take into account particular differences or changes in the conditions that affect the
organization.

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The use of management principle is intended to simplify management work. Keys to what actions
should be taken are suggested by these principles. They provide the benchmarks from which the
comprehensiveness mastery of a subject may be stated and they can be viewed as capsules of what is
believed to be major considerations in current management thought.

Management: Science or Art?

Essential Elements of Science:

Systematic body of knowledge
Universal Principle
Scientific Enquiry and experiment
Cause and effect relationship
Test of validity and predictability

The term management refers to the process of getting activities completed effectively and efficiently
with and through others.

Characteristics of Science:
Certain general principles and facts those are universally applicable
Establish cause and effect relationship
Improve through scientific enquiry and experiments
It serves as a guide to action.

Characteristics of Art:
Personal skills
Creativity
Achievement oriented
Development through continuous practice
Practical application

Management is both art and science.

Management is Inexact Science.

Management science is the body of systemized knowledge accumulated and accepted with the
understanding of general truth concerning management. Management is an inexact science and it is not
a pure science as physical science. Because the inclusion of human elements in managing makes this
discipline not only complex but also controversial as a pure science. Human behavior is unpredictable,
different people think, act or react differently not identical circumstance.

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