CONTEMPORARY MANAGEMENT Powerpoints.pptx

Ch 1 Introduction
Contemporary management : is a modern approach to
overseeing(control) a business and involves activities
like planning, decision-making and monitoring.
• Today Economy is tough(hard) and uncertain
(inexact).
• Companies need strong managers to lead staff for
accomplishing business goals
• Managers are problem solvers and planners as well
• Managers fulfill many roles and have many different
responsibilities at each level of management within
an organization

cont
• Contemporary Management is the result of
manager’s experience over a long period of
time.
• Definitions of Management ( 10 )
• Management is the art of getting things done
through and with people in formally
organized group.

cont
• Management is the art and science of decision-
making and leadership.
• Management is a social process entailing
responsibility
• Management is a multipurpose organ that
manages a business
• Management is the creation and maintenance of
an internal environment where individuals,
working in groups, can perform efficiently.

cont
• Management is the coordination of all resources
• Management is the attainment of goals in an effective
and efficient manner (Match with Doing the right things
and Doing things right)
• Management is the coordination of activities
• Management is the process of designing and
maintaining an environment in which individuals work
to accomplish selected aims

Skills needed by managers/p.3
• Technical skills: requires ability to use a
special proficiency or expertise to perform
particular tasks
• Managers acquire these skills initially through
formal education and then further develop
them through training and job experience
• Technical skills are most important at lower
levels of management.

cont
• Human skills: ability to work well in
cooperation with others in the workplace as a
spirit of trust, enthusiasm, and genuine
involvement in interpersonal relationships.
• A manager with good human skills has a high
degree of self-awareness and a capacity to
understand the feelings of others.
• Some managers are naturally born with great
human skills,

cont
• Others improve their skills through classes or experience.
• Conceptual skills: ability to think analytically, this enable
managers to break down problems into smaller parts
• To recognize the implications of any one problem for others
• managers may acquire these skills initially through formal
education and then further develop them by training and
job experience.
• Designing skills: Ability to solve problems in ways they will
benefit enterprise. Particularly at upper organizational
levels

Other Skills needed by managers
• Leadership: ability to influence others to
perform tasks
• Self-objectivity: ability to evaluate yourself
realistically
• Analytic thinking: ability to interpret and
explain patterns in information
• Behavioral flexibility: ability to modify
personal behavior to react objectives

cont
• Oral communication: — ability to express ideas clearly
in words
• Written communication: — ability to express ideas
clearly in writing
• Personal impact: ability to create a good impression
and instill confidence
• Resistance to stress: ability to perform under stressful
conditions
• Tolerance for uncertainty: ability to perform in unclear
situations

Levels of Management
• Top level: ensure that major performance
objectives are established and accomplished.
• top managers include chief executive officer
(CEO), chief operating officer (COO),
president, and vice president
• These senior managers are considered
executives, responsible for the performance of
organization

cont
• Middle level: managers report to top
managers and are in charge of departments
• Middle managers develop and implement
action plans
• Low level: first-line management position,
such as a team leader
• A person in charge of smaller work units
composed of hands-on workers.

Is management a science or an art?
• Art is a practical application of personal skills
and knowledge to achieve concrete results
• It is also the practical way of doing specific
things
• Elements of Art: Personal skills, Practical
know-how, Results orientation, Creativity,
Constant practice aimed at perfection.

Management is an Art
Reasons:
• Manager applies knowledge and skills to
coordinate the efforts of people.
• Management seeks to achieve concrete practical
results
• It is creative…converts input into output utilize
new situations
• Personalized process… Individual managers adopt
their own approach to manage.

cont
• Science: is a body of knowledge acquired
through systematic learning and training
• Elements of Science: It establishes cause-effect
relationship between variables, It contains
principles/ theories developed through
continuous observation, experimentation and
research, Principles have universal applicability,
Organized body of knowledge can be taught
and learnt in the classroom and outside.

Management is a Science
• Reasons:
• Management is a systematized body of knowledge, cause-
effect analysis.
• Several principles are available, Principles of management
evolved through practical experience/ theoretical research,
Universal application can be demonstrated through the
case studies, It can be taught in classrooms and in industry.
• Management is a science but not exact science like
physics, Chemistry, biology, zoology etc…

Conclusion
• Management is neither exclusively an art nor
exclusively a science—but a combination of
both. It is both an art and science.

ADMINISTRATION VERSUS MANAGEMENT
Administration represents creating plans and
actions to achieve the objectives of the company.
• Administration predetermines the specific
goals and lays down the broad areas within
which these goals are to be attained
• The administration is a determinative function.
• It is a performance of executive duties

next
• Management is an executive function which is
mainly concerned with the broad policies laid
down by the Administration.
• Management is the process of implementing
these plans created by administration to
achieve the final goal

DISTINCTION BETWEEN ENTREPRENEUR AND
MANAGER
• An entrepreneur is the person (or group of
persons) at the top of any business concern
who undertakes financial and legal
responsibility for the success or failure of the
concern. The objectives and main policies of
the enterprise are set by the entrepreneur.
• A manager is an employee of the entrepreneur.
His job is to work for the accomplishment of the
goals and objectives set by the entrepreneur.

Chapter 2: THE EVOLUTION OF MANAGEMENT
SCIENCE
• Classical Schools of Management: developed
during the Industrial Revolution when new
problems related to the factory system began
to appear.
• Managers were unsure of how to train
employees(non-English speaking immigrants)
• Deal with increased labor dissatisfaction, so
they began to test solutions.

cont
• As a result, the classical management theory
developed from efforts to find the “one best
way” to perform and manage tasks.
• This school of thought is made up of two
branches: classical scientific and classical
administrative
• Classical scientific school: arose because of the
need to increase productivity and efficiency.

cont
• The emphasis was on trying to find the best
way to get the most work done
• The classical scientific school owes its roots to
several major contributors, including Frederick
Taylor, Henry Gantt, and Frank and Lillian
Gilbreth.
• Frederick Taylor (Taylor 1856-1915): is often
called the “father of scientific management.”

cont
• Focused on the productivity of individual
worker
• determined changes in management practices
as the solution to improving labor productivity
• observed that managers picked their skills
through trial and error
• there was a shortage of skills in USA and was a
great deal to increase productivity.

cont
• He wanted to find out how to do the job better
and increase productivity,
• want to determine the best way of doing the
job.
• Taylor introduced the differential rate system
of rewarding workers who surpass/go
beyond/exceed their previous performance
were paid more using the differential rate
system related to their effort.

PRINCIPLES
• Science not rule of thumb, (principle based on
practical experience and common sense rather than
theory easily learned and easily applied ) it’s a way of
making decisions without relying on detailed analysis.
• Harmony not rule of discord ( state of not agreeing
or sharing opinions )
• Cooperation not individualism
• The development of each man to his greatest
efficiency and prosperity

Henry Gantt:
Is famous for developing the Gantt chart,
a visual tool used for scheduling and
managing project tasks.
Gantt's chart provided a graphical
representation of project timelines, tasks,
and dependencies. It enabled managers to
plan, coordinate, and track project
progress more effectively.

Frank and Lillian Gilbreth
Frank and Lillian Gilbreth made significant
contributions to time and motion studies and
efficiency improvements in industrial settings.
The Gilbreths applied scientific methods to
study work processes and eliminate
unnecessary motions or wasteful actions
(known as motion studies). They also
pioneered ergonomic design principles to
improve workplace efficiency and worker well-
being.

CHARACTERISTICS OF SCIENTIFIC
MANAGEMENT
• Developed standard method for performing each
job.
• Selected workers with appropriate abilities for
each job.
• Trained workers in standard method.
• Supported workers by planning their work.
• Provided wages/Incentive to workers for
increased output.
• Specialization

Classical administrative school
• Whereas scientific management focused on the
productivity of individuals
• The classical administrative approach
concentrates on the total organization.
• The emphasis is on the development of
managerial principles rather than work methods
• Contributors to this school of thought include
Max Weber, Henri Fayol, Mary Parker Follett, and
Chester I. Barnard

BUREAUCRATIC ORGANIZATION
(Max WEBER—1864-1920—German).
• Many European organizations were managed on
a “personal” family based
• Employees were loyal to individual supervisors
rather than to the organization.
• He believed that organizations should be
managed impersonally where specific rules were
followed
• He didn’t think that authority should be based
on a person’s personality

cont
• He thought authority should be something
that was part of a person’s job and passed
from individual to individual as one person left
and another took over.
• This non-personal, objective form of
organization was called a bureaucracy (system
of administration based upon organization into
bureaus, division of labor, a hierarchy of
authority….in routine manner)

Characteristics of bureaucracy
• Hierarchy of authority, (formal design)
• All positions within a bureaucracy are
structured in a way that permits the higher
positions to supervise and control the lower
positions
• This clear chain of command facilitates control
and order throughout the organization.

cont
• Division of labor and specialization
• All responsibilities in an organization are
specialized so that each employee has the
necessary expertise to do a particular task.
• Rules and regulations
• Standard operating procedures govern all
organizational activities

cont
• Impersonal relationships between managers
and employees
• Managers should maintain an impersonal
relationship with employees
• Favoritism (unfair support shown to one
person ) and personal prejudice (unfair and
unreasonable opinion) do not influence
decisions.

cont
• Competence.
• Not “who you know,” should be the basis for
all decisions made in hiring, job assignments,
and promotions
• All personnel are selected and promoted
based on technical qualifications, which are
assessed by examination

cont
• Records.
• A bureaucracy needs to maintain complete
files regarding all its activities.
• Administrative acts and decisions are recorded
in writing
• Record keeping provides organizational
memory and continuity over time. (Formal
written documents).

Henri Fayol (1868-1925),
• A French mining engineer, developed 14
principles of management based on his
management experiences.
• These principles provide modern-day
managers with general guidelines on how a
supervisor should organize her/his
department and manage her/his staff.

cont
• Division of work: Division of work and
specialization produces more and better work with
the same effort.
• Authority and responsibility: Authority is the right
to give orders and the power to exact obedience.
• A manager has official authority because of her/his
position, as well as personal authority based on
individual personality, intelligence, and experience.
Authority creates responsibility.

cont
• Discipline: Obedience and respect within an
organization are absolutely essential
• Good discipline requires managers to apply
sanctions
• Unity of command: An employee should receive
orders from only one superior.
• Unity of direction: Organizational activities must
have one central authority and one plan of
action.

cont
• Subordination : From individual interest to
general interest.
• The interests of one employee are subordinate
to the interests of an organization.
• Remuneration of personnel: the price of
services rendered by employees should be fair
and provide satisfaction both to the employee
and employer.

cont
• Centralization:The objective of centralization
is the best utilization of personnel
• The degree of centralization varies according
to the dynamics of each organization.
• Scalar chain: A chain of authority exists from
the highest organizational authority to the
lowest ranks.

cont
• Order: Organizational order for materials and
personnel is essential.
• The right materials and the right employees
are necessary for each function and activity.
• Equity: is a combination of kindliness and
justice
• Both equity and equality of treatment should
be considered when dealing with employees.

cont
• Stability of tenure of personnel: To attain the
maximum productivity of personnel, a stable
work force is needed.
• Initiative: Thinking out a plan and ensuring its
success is an extremely strong motivator.
Work with zeal, energy, and initiative.
• Esprit de corps: Teamwork is fundamentally
important to an organization.

Mary Parker Follett
Stressed the importance of an organization .
• She began to think somewhat differently than the other
theorists of her day where employees were treated like robots.
• She began to talk about such things as ethics, power, and
leadership.
• She encouraged managers to allow employees to participate in
decision making. Much of what managers do today is based
on the fundamentals that Follett established more than 70
years ago.

Chester Barnard
• Introduced the idea of the informal
organization.
• He felt that these informal organizations
provided necessary and vital communication
and help the organization accomplish its goals.
Informal Structure
• develop around social groups based on
camaraderie

cont
Informal structures develop because:
• people find new ways of doing things which
they find easier and save them time.
• patterns of interaction are shaped by
friendship and other relationship
• people forget what the formal structures are
• it is easier to work with informal structures.

Summary
• Henri Fayol-(1868-1925) French engineer
talked on 14 principles of management.
• Mary Parker Follet-(1868-1933) Shared goals
among managers.
• Chester I. Barnard-(1886-1961) Informal
organization.
• Taylor: Father of scientific management.
• Fayol: Father of principles of management.

Behavioral Management Theory
• Interactions and motivations of the individual
within organizations
• In short, classical theory ignored employee
motivation and behavior.
• The behavioral management theory is often
called the human relations movement
• It addresses the human dimension of work such
as motivation, conflict, expectations, group
dynamics, improved productivity.

cont
• This school viewed employees as individuals,
resources, and assets to be developed and
worked with not as machines, as in the past.
• Several individuals and experiments
contributed to this theory: Elton Mayo,
Abraham Maslow, Clayton Alderfer, Douglas
McGregor

Elton Mayo
• Employees are motivated by relational factors
such as attention and camaraderie than by
monetary rewards
• Organizations should treat people as
individuals not machines with individual
needs.
• Employees desire to be part of a supportive
team that facilitates development and growth

Abraham Maslow
• Employees are motivated by a series of five
universal needs
• These needs are ranked, according to the order
in which they influence human behavior, in
hierarchical fashion.
• Physiological needs are deemed to be the
lowest- level needs
• These needs include the need for food, oxygen,
sex, and drink.

cont
• Safety needs: include a desire for security,
shelter stability, dependency, protection,
freedom from fear and anxiety (worries)
• need for structure, order, and law, a minimal
degree of employment security
• Financial security, protection, Health and well-
being

cont
• Social needs include the need for
belongingness and love.
• As gregarious creatures, human have a need
to belong
• In the workplace, this need may be satisfied by
an ability to interact with one's coworkers

cont
• Ego and esteem needs include the desire for
self-respect, self-esteem, and the esteem of
others
• Desire for reputation, prestige, status, fame,
glory, dominance, recognition, attention,
importance, and appreciation.
• Seeking social approval and esteem from
other people

cont
• Self-actualization needs is the highest need in
Maslow's hierarchy, the need for self-
realization, continuous self-development, and
the process of becoming all that a person is
capable of becoming.
• Self-actualization can be seen as similar to
words and concepts such as self-discovery,
self-reflection, self-realisation and self-
exploration

Clayton Alderfer
• E-R-G THEORY
• Clayton Alderfer reworked Maslow's Need Hierarchy
to align it more closely with empirical research.
• Existence refers to our concern with basic material
existence requirements; what Maslow called
physiological and safety needs
• In the work area these include the salary/pay,
working conditions, job security and fringe
benefits(received in addition to normal benefit)

cont
• Relatedness refers to the desire we have for
maintaining interpersonal relationships;
similar to Maslow's social/love need, and the
external component of his esteem need.
• Growth refers to an intrinsic desire for
personal development; the intrinsic
component of Maslow's esteem need, and
self-actualization

cont
• Alderfer's E-R-G theory differs from Maslow's
Need Hierarchy:
• Insofar as E-R-G theory demonstrates that
more than one need may be operative at the
same time. ERG theory does not assume a
rigid hierarchy where a lower need must be
substantially satisfied before one can move
on.

Douglas McGregor
• Douglas McGregor believed that two basic
kinds of managers exist:
• Theory X (authoritarian management)
• Manager has a negative view of employees ;
they are inherently lazy and don’t want to
work, they dislike work.
• Employees want to avoid responsibilities and
want to be directed

cont
• Theory Y : (participative management)
• Employees take work as natural
• Seek responsibilities and work under good
conditions.
• Employees are creative, imaginative and solve
organizational problems
• Employees will apply self-control and self-
direction

Contingency School of Management theory
• Contingency management recognizes that there
is no one best way to manage, it all depends
• The appropriate management actions and
approaches depend on the situation
• Managers with a contingency view use a flexible
approach,
• It does not apply certain management
principles to any situation.

CHAPTER 3: MANAGERIAL FUNCTIONS
• Organizational Planning
• planning is the most fundamental among the
five functions of management, all others are
stemming from planning
• A plan is a blueprint (detailed plan) for goal
achievement
• It means determining the organization’s goals
and defining the means for achieving them

cont
• Planning increases the possibility of survival in
business and manage the risks that may occur
in the future
• In short, planning is preparing for tomorrow,
today
• It’s the activity that allows managers to
determine what they want and how they will
achieve it.

cont
• it also answers six basic questions in regard to
any activity:
• What needs to be accomplished?
• When is the deadline?
• Where will this be done?
• Who will be responsible for it?
• How will it get done?
• Which/how much time, energy, resources ?

IMPORTANCE OF PLANNING.
• Planning helps better performance
• Planning does not guarantee success
• Companies which plan perform better than
those which do not.

cont
• The military adage (says)
• “If you fail to plan, you plan to fail,” is very
true
• Without a plan, managers are set up to
encounter errors, waste, and delays.
• A plan, on the other hand, helps a manager
organize resources and activities efficiently
and effectively to achieve goals

Discussion
• “If you fail to plan, you plan to fail,”

USES OF PLANNING
• Planning focuses on objectives and results
• It reduces uncertainty and risk.
• It provides sense of direction
• It encourages innovation.
• It helps coordination.
• It guides decision making.
• It provides a basis for decentralization
• It provides efficiency in operations.
• It facilitates control

advantages of planning
• Gives an organization a sense of direction: Without plans
and goals, organizations merely react to daily occurrences
without considering what will happen in the long run.
• Focuses attention on objectives and results: Plans keep
the people who carry them out focused on the anticipated
results. In addition, keeping sight of the goal also
motivates employees.
• Establishes a basis for teamwork: Diverse groups cannot
effectively cooperate in joint projects without an
integrated plan. E.g military activities require the
coordination of Army[ Navy/ sea force, Air force unity]

next
• Helps anticipate problems and cope with
change: it can help forecast future problems
and make any necessary changes up front to
avoid them. Planning for these potential
problems helps to minimize mistakes and
reduce the “surprises” that inevitably occur.

next
• Provides guidelines for decision making:
Decisions are future-oriented. If management
doesn’t have any plans for the future, they will
have few guidelines for making current decisions.
If a company knows that it wants to introduce a
new product three years in the future, its
management must be mindful of the decisions
they make now. Plans help both managers and
employees keep their eyes on the big picture.

next
• Serves as a requirement to employing all
other management functions: Planning is
primary, because without knowing what an
organization wants to accomplish,
management can’t intelligently undertake any
of the other basic managerial activities:
organizing, staffing, leading, and/or
controlling.

Using Plans to Achieve Goals
• Planning is a crucial activity, for it designs the
map that lays the groundwork for the other
functions.
• The plan itself specifies what should be done,
by whom, where, when, and how.
• But before an organization can plan a course
of action, it must first determine what it wants
to achieve.

next
• Objectives, the end results desired by the organization,
are derived from the organization’s mission statement.
• The mission statement explains what the organization
stands for and why it exists.
• The mission statement is the basis for all goals and
plans outlined throughout the organization. Therefore,
managers must use effective planning and goal-setting
techniques to ensure that internal policies, roles,
performances, structures, products, and expenditures
are in line with the mission of the organization.

Criteria for effective goals
A goal is a desired future state that the organization
attempts to realize.
• Goals specify future ends :plans specify today’s means.
• Goals must be specific and measurable: When possible,
use quantitative terms, such as increasing profits by 2
percent or decreasing by 1 percent, to express goals.
• Goals should cover key result areas: Because goals
cannot be set for every aspect of employee or
organizational performance, managers should identify a
few key result areas.

next
• Goals should be challenging but not too
difficult: When goals are unrealistic, they set
employees up for failure and lead to low
employee morale. However, if goals are too
easy, employees may feel motivated.
Managers must be sure that goals are
determined based on existing resources and
are not beyond the team’s time, equipment,
and financial resources.

next
• Goals should specify the time period over which
they will be achieved: Deadlines give team
members something to work toward and help
ensure continued progress. It would be more
appropriate to provide a short term goal such as,
“Establish a customer database by June 30.”
• Goals should be linked to rewards: People who
attain goals should be rewarded with something
meaningful and related to the goal.

Goal Formulation and MBO
• Management by objectives (MBO) is a
management technique for setting clear goals for a
specific time period and monitoring the progress.
• The business unit sets these objectives and then
manages by objectives (MBO).
Unit’s objectives must be hierarchical
Objectives should be quantitative
Objectives should be realistic
Objectives must be consistent

cont
• Management by objectives (MBO) is a
strategic management model that aims to
improve the performance of an organization
by clearly defining objectives that are agreed
to by both management and employees.

cont
• Management by objectives uses the top company
goals to determine employee objectives.
• MBO allows everyone in the company to see what
they have accomplished pertaining to the top
goals and priorities of the company while they
perform tasks.
• This shows how activity and outcome go together
and may drastically/rapidly increase productivity.

Benefits of MBO
Performance improvement: MBO can greatly improve
employee performance in the workplace. Detailed
planning leads to better performance and more profit.
Sense of identity: MBO can give employees a greater
sense of identification. Employees feel proud that they
are involved in the goals of the organization and
therefore become more productive employees.
Everyone knows what role they play within the
organization.

cont
Career growth: Employees have the opportunity to
further their careers.
• Management takes a big interest in improving and
enriching the skills of employees and provides
many opportunities for these trainings to happen.
• Performance evaluations give employees feedback.
• It allows the employee to become stronger in areas
where they are struggling and shows them these
areas.

How to create your own MBO/Quiz
• Define organizational goals
• Create employee objectives
• Continuously monitor performance and
progress
• Evaluate performance
• Provide feedback
• Performance appraisal

Goal Formulation and MBWA
• Management by Walking Around. MBWA basically refers
to managers spending some part of their time listening
to problems and ideas of their staff, while wandering
around an office or plant.
• The management by walking around or management
by wandering around (MBWA), also, refers to a style of
business management which involves managers
wandering around, in an unstructured manner, through
the workplace(s), at random, to check with employees,
equipment, or on the status of ongoing work.

Con’t
• The opportunity is for the leader to connect with staff,
and when used effectively, to gain hugely valuable
information,
• Managers spend a significant time making informal
visits to work area and listening to employees
• When done well, the habit also can better connect
employees to your team and organization.
• What are your goals in talking with employees? What
might you learn that will help you run the business
better

Con’t
• The emphasis is on the word wandering as an
unplanned movement within a workplace,
rather than a plan where employees expect a
visit from managers at more systematic, pre-
approved or scheduled times
• Despite its informality, MBWA is an extremely
effective management style.

cont
• The Management by Walking Around (MBWA)
approach is quite possibly the solution you are
looking for. This is a simple technique that
involves walking the halls and casually
checking in with your team.
• There are five reasons why even the busiest
managers should adopt the MBWA approach:

cont
1. MBWA makes you more accessible
• One of the biggest criticisms faced by busy managers is
that they are hard to track down
• Adopting the MBWA technique resolves this by having
you find them.
• They no longer experience the frustration of having to
hunt you down.
• Also, when you go to their desk you might find them
more comfortable and willing to speak freely about
any challenges or issues.

cont
2. MBWA helps to address issues in the early (and
easier) stages
 MBWA helps to identify issues or obstacles in the early
stages when they tend to be easier to manage.
 Simply asking about how projects are going helps you
to see and hear things sooner (or possibly wouldn’t
have otherwise heard about).
 It has been said that by the time a problem has
reaches the manager’s office door, it has become too
big for the employee to handle.

Con’t
3. MBWA reduces interruptions
• Ironically, walking around to see our team may be the
best way to deal with interruptions
• We seek out the interruptions before they find us.
• The MBWA approach forces us to protect time for the
inevitable questions. It also encourages us to deal with
questions in person rather than over email, which is so
much more effective.
• Getting away from our computers and out there with
our team can be refreshing for everyone.

cont
4. MBWA improves team productivity
• They say that we get the behaviour that we
pay attention to.
• As Tom Peters said, “The simple act of paying
positive attention to people has a great deal to
do with productivity.”

cont
5. MBWA makes people more engaged
• Great leadership does not happen when sitting in
front of a computer.
• Fully engaging your team requires you to connect
with them
• Use MBWA to provide positive attention by
acknowledging some of the great things they are
doing and provide some real-time, constructive
feedback.

Types of Plans
Operational , tactical , strategic & contingency plans
1. Operational plans: “Operational plans are about how things need to
happen,”
• Single-use plans
• apply to activities that do not recur or repeat; it is one-time
occurrence
Examples
• A budget
• Programs
• Schedules
• Projects
• Methods

cont
• Multiuse plans
• Continuing or ongoing plans usually made
once and retain their value over a period of
years
Examples
• A policy
• A procedure
• A rule

next
• Policies are general statements that explain
how a manager should attempt to handle
routine management responsibilities
• A procedure is a set of step-by-step directions
that explains how activities or tasks are to be
carried out
• A rule is an explicit statement that tells an
employee what he or she can and cannot do.
Rules are “do” and “don’t”

cont
2. Tactical plans
• A tactical plan is concerned with what the
lower level units within each division must do,
how they must do it, and who is in charge at
each level.
• Tactics are the means needed to activate a
strategy and make it work with shorter time
frames and narrower scopes than are strategic
plans (one year or less )

cont
3. Strategic plans
• A strategic plan is an outline of steps designed
with the goals of the entire organization
• Strategic plans look ahead over the next two,
three, five, or even more years to move the
organization
• Top-level management develops the directional
objectives for the entire organization

cont
4. Contingency plans
• Intelligent and successful management
depends upon a constant pursuit of
adaptation, flexibility, and mastery of changing
conditions.
• Strong management requires a “keeping all
options open” approach at all times
• that’s where contingency planning comes in.

cont
• Contingency planning involves identifying
alternatives when the original plan proves
inadequate because of changing circumstances
and unexpected problems even events
frequently occur or in case things don’t go as
expected
• Contingency plan gets the manager in the
habit of being prepared and knowing what to
do if something goes wrong.

PLANNING PREMISES.
• Planning premises are the anticipated
environment in which plans are expected to
operate.
• Planning premises are the building blocks on
which the super- structure of planning is based.
• Plans are prepared for future which is uncertain
• The assumptions about the future delivered from
forecasting and used in planning are known as
PLANNING PREMISES.

cont
• Premises are planning assumptions about the
environment in which the plan is to be
carried out.
• Major purpose of premises is to facilitate the
planning process by: Guiding, Directing,
Reducing the degree of uncertainty

STRATEGIC PLANNING Versus OPERARIONAL
PLANNING.
Strategic planning and operational planning are two key
processes in organizational management:
• Strategic Planning: This involves setting long-term goals
and objectives for the organization, usually spanning several
years.
• Strategic planning focuses on the big picture and involves
analyzing the external environment, identifying
opportunities and threats, and determining the direction the
organization should take to achieve its mission.
• It involves top-level management and aims to align the
organization's resources and capabilities with its long-term
goals.
• Strategic planning typically involves decisions regarding
market positioning, resource allocation, and major
investments.

Con’t
Operational Planning: Operational planning, on the other hand, deals
with the day-to-day activities and short-term objectives of the
organization.
It involves translating the strategic goals and objectives into specific
actions and plans that guide the daily operations of the organization.
Operational planning is more detailed and focuses on the implementation
of strategies to achieve immediate goals and targets.
It typically involves middle and lower-level management and includes
activities such as budgeting, scheduling, staffing, and task.
summary, strategic planning sets the overall direction and goals of
the organization, while operational planning focuses on implementing
strategies and managing daily activities to achieve those goals.

Barriers to Planning or limitations of planning.
• Lack of accurate information.
• Time and cost.
• Inflexibility (rigidity ).
• Resistance to change.
• Lack ability to plan.
• False sense of security.
• Environnemental constraints

DECISION MAKING.
• Decision Making is a process of selection from
a set of alternative courses of action which is
thought to fulfill the objectives of the decision
problem more satisfactorily than others.

STEPS
• Identify the problem,
• Analyze the problem.
• Develop alternative solutions.
• Evaluate alternative solutions
• Select best alternatives (which maximize the
results).
• Implementation and follow up.

Organizing and the Organizational Structure
• After a manager has a plan in place, he/she can
structure his/her teams and resources
• This can profoundly affect an organization’s success
• The organizational structure influences employees’
attitudes toward their work.
• A suitable structure can minimize a business’s
costs, as well as maximize its efficiency and
increases its ability to compete in a global
economy

Organizational Process
• Organizing, like planning, must be a carefully
worked out and applied process.
• This process involves determining what work
is needed to accomplish
• Assigning those tasks to individuals
• The end result of the organizing process is an
organization

cont
• Organizational process consists of five steps:
• Review plans and objectives: Objectives are the
specific activities that must be completed to
achieve goals.
• Determine the work activities necessary to
accomplish objectives: Managers simply list
and analyze all the tasks that need to be
accomplished in order to reach organizational
goals.

next
• Classify and group the necessary work activities
into manageable units: A manager can group
activities based on four models (functional,
geographical, product, and customer).
• Assign activities and delegate authority: Managers
assign the defined work activities to specific
individuals
• Design a hierarchy of relationships: A manager
should determine the vertical and horizontal
relationships of the organization as a whole.

cont
Principles developed by Henri Fayol:
Work specialization
• sometimes called division of labor, is the degree
to which organizational tasks are divided into
separate jobs.
• Employees within each department perform only
the tasks related to their specialized function
• When specialization is extensive, employees
specialize in a single task

cont
Chain of command
• The chain of command is an unbroken line of
authority that links all persons in an
organization and defines who reports to
whom.
• This chain has two underlying principles: unity
of command and scalar principle.

cont
Unity of command:
• This principle states that an employee should have one
and only one supervisor to whom he or she is directly
responsible
• No employee should report to two or more people.
• Otherwise, the employee may receive conflicting
demands or priorities from several supervisors at once
• Management should ensure that each has one boss,
and only one boss to whom he or she directly reports

cont
Scalar principle:
• The scalar principle refers to a clearly defined
line of authority that includes all employees in
the organization
• There should be a clear and unbroken chain of
command linking every person in the
organization

cont
Authority
• Authority is the formal and legitimate right of a
manager to make decisions, orders, and allocate
resources to achieve organizationally desired
outcomes.
Organizational authority has three principles:
• Authority is based on the organizational position
• Authority is accepted by subordinates
• Authority flows down the vertical hierarchy

cont
In addition, authority comes in three types:
• Line authority : gives a manager the right to
direct the work of his or her employees and make
many decisions without consulting others
• Staff authority : supports line authority by
advising, servicing, and assisting
• Functional authority : is authority delegated to an
individual or department over specific activities
undertaken by personnel in other departments

Delegation
• Delegation is the downward transfer of
authority from a manager to a subordinate.
• Why? to provide maximum flexibility in meeting
customer needs, delegation leads to
empowerment, in that people have the
freedom to contribute ideas
• This involvement can increase job satisfaction
for the individual and frequently results in
better job performance

cont
• Without delegation, managers do all the work
themselves and underutilize their workers
The ability to delegate is crucial to managerial success
using the four steps :
assign tasks to individual team members : employees
know that they are responsible for carrying out
specific assignments.
Give team members the correct amount of authority to
accomplish assignments: employee is assigned
authority proportionate with the task

cont
Make sure that team members accept
responsibility:
• Responsibility is the duty to perform the task
or activity an employee has been assigned.
• An important distinction between authority
and responsibility is that the supervisor
delegates authority, but the responsibility is
shared

cont
• Delegation of authority gives a subordinate
the right to make commitments, use
resources, and take actions in relation to
duties assigned.
• The obligation created is not shifted from the
supervisor to the subordinate — it is shared.
• A supervisor always retains some
responsibility for work performed

cont
Create accountability
• Accountability means answering for one’s
actions and accepting the consequences
• Managers can build accountability into their
organizational structures by monitoring
performances and rewarding successful
outcomes.

cont
Managers find difficult to accomplish delegation
for the following reasons:
• Delegation requires planning, and planning
takes time
• Managers may simply lack confidence in the
abilities of their subordinates (“If you want it
done well, do it yourself.” ) If managers feel that
their subordinates lack abilities, they need to
provide appropriate training

cont
• Managers experience dual accountability
Managers are accountable for their own actions
and the actions of their subordinates.
(If a subordinate fails to perform a certain task or
does so poorly, the manager is ultimately
responsible for the subordinate’s failure)
• Finally, managers may refrain from delegating
because they are insecure about their value to
the organization

cont
How do managers learn to delegate effectively?
The following additional principles may be
helpful for managers who’ve tried to delegate in
the past and failed:
• Match the employee to the task :
• Managers should carefully consider the
employees to whom they delegate tasks.
• The individual selected should possess the skills
and capabilities needed to complete the task.

cont
• Be organized and communicate clearly:
• The manager must have a clear understanding
of what needs to be done, what deadlines
exist, and what special skills are required.
• Managers must be capable of communicating
their instructions

cont
• Transfer authority and accountability with
the task.
• This means providing the employees with the
necessary resources and power to succeed,
giving them timely feedback on their progress,
and holding them fully accountable for the
results of their efforts.

cont
• Choose the level of delegation carefully
• The manager must maintain some control of
both the process and the results of the
delegated activities.
• the manager can choose to delegate at several
levels, depending upon the confidence the
manager has in the subordinate and the
importance of the task

Centralization versus decentralization
• A centralized organization concentrates
authority at the upper levels
• one individual makes decisions and provides
direction for the company.
• all decisions and processes are handled strictly
at the top or the executive level.

cont
• In a decentralized organization is to spread
authority to the lower organization levels.
• Decentralized organizational structures have
several individuals responsible for making
business decisions
• Decentralization is the transfer of decision
making power and assignment of
accountability and responsibility for results

Staffing as a Management Function
• Staffing is filling, keeping filled, and positions in the
organization structure
• it needs people with the right skills, knowledge, and
abilities to fill in that structure because people are
resources
• staffing, is the management function devoted to acquiring,
training, appraising, and compensating employees
• Staffing is an ongoing process that begins with finding the
right people through proper planning, recruiting, and
selecting.

cont
• This function of staffing is known as human resource
management. The sub-functions include the following:
• Job analysis
• Recruitment
• Selection
• Placement
• Induction
• Training
• Compensation
• Performance evaluation.

cont
• JOB ANALYSIS (It is work related activity)
• Job is a group of positions that are similar as
to kind level of work.
• Position is a group of tasks assigned to one
individual
• JOB IS IMPERSONAL WHILE POSITION IS
PERSONAL

cont
Job analysis has four dimensions:
• Job description
• Job specification
• Job performance standards
• Job evaluation
JOB DESCRIPTION: A written statement of what
a jobholder does, how it is done and why it is
done. It is also called task statement

cont
• It gives the details of title, department, job summary,
job duties, working condition etc…
• JOB SPECIFICATION: States the minimum acceptable
qualification that an employee must possess to
perform a given job successfully.
• It gives the details of physical demands, mental
demands of a job etc….
• it provides, title, location, supervisor, skill factors,
education, experience communication level . It is also
called skill statement

cont
• JOB PERFORMANCE STANDARDS: Statement
of attainable performance
• It gives the details of quantitative and
qualitative factor to be achieved on job.
• JOB EVALUATION: This is a systematic and
orderly process of determining the worth of a
job in relation to other job. Its objective is to
determine the correct rate of pay.

cont
• RECRUITMENT. (It is a person related activity).
• Recruitment is a process of searching for
prospective employees and stimulating them
to apply. The need for recruitment may arise
because of the vacancies in the organization
due to:

cont
SIDE OF EMPLOYEES
• Transfer,
• Promotion,
• Retirement and
• Death of employees
SIDE OF BUSINESS
• Diversification
• Expansion and
• Growth of the business

cont
• SELECTION: Selection is the process of
identifying and appointing a suitable person to
hold a specific job in the organization.
• It consists of the following procedures:

cont
Screening or Preliminary Selection
• Notification,
• Receipt of applications,
• Elimination of ineligible applicants,
• Application blank/ forms,
• Preliminary testing.
• Screening interview
• Background investigation (Reference check).
• Physical examination (Medical).
• Appointment order.

cont
PLACEMENT
• This is defined as determining job to which an
accepted candidate is to be assigned and his
assignment to job.
• INDUCTION
• It is called welcoming process of a new employee to
organization.
• This is defined as introducing new employee to work,
work environment, work practices, policies and
purposes of organization

cont
Induction Procedure
• Reporting of new employee—time, place.
• Welcome by boss.
• Finish administrative formalities.
• Department orientation—Verbal.
• Printed information about organization

cont
Techniques:
• General orientation by staff,
• Specific orientation by supervisor,
• Follow-up orientation by personnel
department.

cont
TRAINING.
• Most training takes place on the job (on-the-job
training methods including):
• Job rotation: assigning people to different jobs or tasks
to different people
• Mentoring programs: this type of training is usually
called an apprenticeship, it is also called a coaching or
mentoring relationship.
• The new employee works under the observation of an
experienced worker.

cont
• Sometimes, training goals cannot be met
through on-the-job training (Off-the-job
training ) this rely on outside consultants
• The employer needs to look to other
resources.
• The more popular off-the-job training
methods are classroom lectures, videos, and
simulation exercises.

cont
COMPENSATION.
• The employees of the organization need to be
paid compensation for his/ her services.
• This is also called Remuneration.
• The compensation is decided on the basis of
the job evaluation.

Controlling- The Linking Function
• Controlling is the management function in
which managers establish and communicate
performance standards for people, processes,
and devices.
• organizational control is the process of
assigning, evaluating, and regulating resources
on an ongoing basis to accomplish an
organization’s goals and share that information
with employees

cont
• Control can be defined as the process a manager
takes to assure that actual performance
conforms to the organization’s plan
• The six major purposes of controls are as
follows:
• Controls make plans effective
• Controls make sure that organizational
activities are consistent

cont
• Controls make organizations effective
• Controls make organizations efficient
• Controls provide feedback on project status
• Controls aid in decision making
The Control Process
• Establish standards to measure performance
• Measure actual performance

cont
• Compare performance with the standards
• Take corrective actions
Types of Controls
• Feed-forward controls (its reacts proactively to keep the
system stable)
• Concurrent controls (refer to monitoring and regulating
processes as they happen, this one focus on real time
management)
• Feedback controls ( it responds to changes after they occur
using the information from outputs or results)

Discussion
‘’ If you try to control everything, you may end
up by controlling nothing’’

cont
Characteristics of Effective Control Systems
• A focus on critical points: controls are applied
where failure cannot be tolerated or where
costs cannot exceed a certain amount
• Integration into established processes:
Controls must function harmoniously within
these processes and should not block
operations.

cont
• Acceptance by employees: . Employee
involvement in the design of controls can
increase acceptance.
• Availability of information when needed:
Deadlines, time needed to complete the
project, costs associated with the project, and
priority needs are apparent in these criteria

cont
• Economic feasibility: Effective control systems
answer questions such as, “How much does it
cost?” “What will it save?” or “What are the
returns on the investment?”
• Accuracy: Effective control systems provide
factual information that’s useful, reliable, valid,
and consistent
• Comprehensibility: Controls must be simple
and easy to understand.

cont
Control Techniques:
Control techniques provide managers with the
type and amount of information they need to
measure and monitor performance
• Financial controls: After the organization has
strategies in place to reach its goals, funds are
set aside for the necessary resources and
labor.

cont
• As money is spent, statements are updated to
reflect how much was spent, how it was spent,
and what it obtained
• Managers use these financial statements, such
as an income statement or balance sheet, to
monitor the progress of programs and plans
• Financial statements : provide management
with information to monitor financial resources
and activities.

cont
• Income statement : shows the results of the
organization’s operations over a period of
time, such as revenues, expenses, and profit or
loss
• Balance sheet : shows what the organization is
worth (assets) at a single point in time, and the
extent to which those assets were financed
through debt (liabilities) or owner’s investment
(equity).

cont
• Financial audits: are regularly conducted to
ensure that financial management practices
follow generally accepted procedures, policies,
laws, and ethical guidelines. Audits may be
conducted internally or externally
• Financial ratio analysis : examines the
relationship between specific figures on the
financial statements and helps explain the
significance of those figures:

cont
• Liquidity ratios : measure an organization’s
ability to generate cash.
• Profitability ratios : measure an
organization’s ability to generate profits.
• Debt ratios : measure an organization’s ability
to pay its debts.
• Activity ratios : measure an organization’s
efficiency in operations and use of assets

cont
• Budget controls: A budget depicts how much
an organization expects to spend (expenses)
and earn (revenues) over a time period
• Budgets not only help managers plan their
finances, but also help them keep track of
their overall spending
• A budget, in reality, is both a planning tool and
a control mechanism.

cont
• Some budget development methods are as
follows:
• Top-down budgeting: Managers prepare the
budget and send it to subordinates
• Bottom-up budgeting: Figures come from the
lower levels and are adjusted and coordinated
as they move up the hierarchy.

cont
• Zero-based budgeting: Managers develop each new
budget by justifying the projected allocation against
its contribution to departmental or organizational
goals. All expenses must be justified for each new
period. The goal is that your income minus your
expenditures equals zero by the end of the month.
• Flexible budgeting: Any budget exercise can
incorporate flexible budgets, which set “meet or beat”
standards that can be compared to expenditures.

cont
• Marketing controls: help monitor progress toward goals
for customer satisfaction with products and services,
prices, and delivery
• The following are examples of controls used to evaluate
an organization’s marketing functions:
• Market research : gathers data to assess customer
needs—information critical to an organization’s success.
• Ongoing market research reflects how well an
organization is meeting customers’ expectations and
helps identify competitors.

cont
• Test marketing : assess customer acceptance. Using
surveys and focus groups, test marketing goes beyond
identifying general requirements and looks at what
(or who) actually influences buying decisions.
• Marketing statistics : measure performance by
analyzing results
• Managers look at marketing ratios, which measure
profitability, activity, and market shares as well as
sales quotas, which measure progress toward sales
goals and assist with inventory controls

cont
• Human resource controls: help managers regulate the
quality of newly hired personnel, as well as monitor
current employees’ developments and daily performances
• On a daily basis, managers can go a long way in helping to
control workers’ behaviors in organizations
• Managers can also institute policies and procedures to
help guide workers’ actions.
• Managers can consider past experiences when developing
future strategies, objectives, policies, and procedures

cont
• Computers and information controls:
Controlling access to computer databases is
the key to this area.
• Computers are being used to collect and store
information for control purposes.
• Almost all organizations have confidential and
sensitive information that they don’t want to
become general knowledge

cont
Limitations of the use of information technology:
Performance limitations:
• replacing long-time organizational employees with
information systems technology may result in the
loss of expert knowledge that these individuals hold.
• computerized information systems are expensive
and difficult to develop
• information systems do not work all the time,
resulting in costly downtime.

cont
Behavioral limitations:
• Information technology allows managers to
access more information than ever before.
• Too much information can overwhelm (defeat
someone, passive) employees, cause stress, and
even slow decision making
• Health risks: Potentially serious health-related
issues associated with the use of computers
have been raised in recent years.

cont
• Performance evaluation: is a process appraising an
employee’s performance of a job in terms of its requirements
Process:
• To establish performance standards,
• To communicate performance expectations to employees,
• To measure actual performance,
• To compare actual performance with standard performance,
• To discuss the appraisal with employee,
• To initiate corrective actions if necessary

cont
Evaluating Employee Performance
• Employee performance should be evaluated
regularly.
• Employees want feedback—they want to
know what their supervisors think about their
work
• provide employees with an opportunity to
correct deficiencies.

cont
Evaluations help in making key personnel decisions,
such as the following:
• Justifying promotions, transfers, and terminations
• Identifying training needs
• Providing feedback to employees on their
performance
• Determining necessary pay adjustments
• Employee must be terminated because of poor
performance

Cont
• Compensating Employees : refers to all work-
related payments, including wages, commissions,
insurance, and time off.
• Wages and salaries are the most obvious forms of
compensation and are based on job evaluations
• employees are paid a fixed amount for each hour
they work.
• Salaried employees receive a fixed sum per week
or month, no matter how many hours they work.

cont
• the reality is that these jobholders typically
work in excess of a “minimum” 45-hours per
week.
• Some occupations are compensated through
incentive pay programs
• Some employees are offered merit awards as
a reward for sustained superior performance.

cont
• Other benefits are optional and help build
employee loyalty to an organization, including the
following:
• Health insurance
• Pension plans
• Employee discounts
• Vacation, sick, and personal days
• Bonuses
• Profit-sharing

Group Work+ Presentation
• CHAPTER 4.
MANAGERS AND ENVIRONMENT:
ORGANIZATIONAL ENVIRONMENTAL
ADAPTATION, EXTERNAL AND ETHICAL
ENVIRONMENTS
• CHAPTER 5.
COMMUNICATION SKILLS AND
ORGANIZATIONAL PERFORMANCE

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