Unit 4. A short course in management concepts of management and organization

Management has as many definitions as there are managers. Some, like a personnel manager, have a natural bias towards the sociological approach*, being concerned mainly with human activities. Others such as a financial tycoon*, can just as easily show a preference for the quantitative aspects*.

Somewhere in between is the managing director, or general manager, with an integrated and balanced viewpoint – a bird's-eye view* – taking in the whole scene at once. That is at least in the theory. Yet all too often, despite promotion to general management, the former accountant, for example, still remains an accountant. For one of the problems of any specialist in this context is learning how to stand back from his profession in order to look at the business objectively, as a whole*, instead of from one side or the other.

There are debates whether management is an art or a science and whether managers are born or made. From a sociological point of view management would seem to be mainly an art (for example, how to motivate people to give of their best), whereas from a quantitative point of view it appears to be far more scientific. But even on the sociological side we are now familiar with behavioral scientists*.

As to whether managers are born or made, there must, of course, be certain minimal innate qualities (i.e. potential) which can be added to effectively by proper training and planned experience. Fortunately, or unfortunately, we have already been created; but at least we can build on nature, such as it is in our case, by adopting the right management attitudes and using every possible means to come to grips with a fascinating career*. The personal satisfaction arising from even modest managerial achievements usually makes such efforts "well worth while."*

In practical business, management is the art and science of getting things done through other people, but it also includes effective use of your own time. To operate a successful business you need strong management skills. Effective management is the key to business success.

Management and Organization Defined

Management includes those personnel who have the right to make decisions that affect company's affairs. Organization is the means by which management coordinates the efforts of employees to attain the company's objectives*.

Organizational Structure

Organization involves structure. An organizational structure is a framework enabling management to delegate and control the responsibilities of individuals and departments. In this way, a company can function as a unit with the same efficiency as a business run by one person.

Once organizational structure has been established, areas (and sub-areas) of activities, levels of authority, and duties must be clearly defined.

Yet with this structure, allowance must be made for initiative. Good management permits employees (and managers) to grow according to individual abilities. This is a valuable asset to a company in that individual talents contribute to organizational growth. Where workers feel they are mere cogs in a wheel*, their morale falls and their work efficiency decreases, and the firm loses the benefits it might have otherwise derived from its employees.

Thus, communication is of great importance in organizational structure. A smooth, two-way flow (from management to employees and from employees to management) ensures efficient functioning through feedback, suggestions, and grievances.

Levels of Management

There are three management levels: top management, middle management, and operating management. Top management includes the president, vice presidents, and the general manager. Middle management includes department managers, plant managers, and production superintendents. Operating management includes supervisors, foremen, etc.

Decision Making

The most important responsibility of a manager at any level is decision making. (It is often said that decisions are the motor of business.) Successful management is a matter of skill in choosing from alternatives.

Decision making can be broken down into five components: (1) recognizing the problem, (2) defining and analyzing the problem, (3) evaluating alternative solutions, (4) choosing the most favorable solution, and (5) implementing the approach chosen.

Management Functions

The overall responsibility for decision making encompasses the following managerial functions.

Planning. The process of establishing organizational goals and a strategy for their accomplishment is known as the planning function. It is concerned with the future – immediate and/or long range. Middle and operational management planning generally stems from the goals (i.e. the plan) set by top management.

Organizing. Once goals and strategies have been formulated, organizing makes things happen as planned. This is an operational function; it depends heavily on the coordinated effort of an entire organization.

Directing. This is the motivational function. An organized effort requires complete cooperation and, in directing operations, management seeks to obtain a high level of production from employees through motivation and proper guidance.

Controlling. The control function monitors the achievement of goals, and compares actual results with those projected in planning as well as actual performance in past periods. It is directly related to the plans and performance standards established by other managerial functions.

Staffing. This is the process of finding the right person for each job. It involves matching individual qualifications to job specifications. Staffing is an on-going function* because once a position is filled, performance must be evaluated and employee growth encouraged. Further, the chain of promotions, retirements, resignations and terminations is never-ending and always results in staffing needs*.

Innovating. This is the creative function. Changing times require new approaches, advancing technology demands new procedures. Finding new and better ways to do the job, handling the staff, and getting additional money are only some of the creative tasks managers often deal with.

Managerial Performance

It should be clear from the preceding section that successful managerial performance rests on three basic elements – leadership, motivation and communication.

Leadership. The leadership style a manager adopts depends as much on personal goals and needs as on those of the subordinates involved. The general work environment also influences that style. While three basic styles can be isolated (i.e. autocratic, democratic and laissez-faire*), effective managerial performance generally reflects a mix – choosing the right approach for each situation.

Motivation. The modern concept of motivation refers to the process of creating a work environment that will stimulate employees to perform at superior levels. On the manager's part, it means presenting a clear picture of what is expected of employees, providing them with necessary guidance, and giving them the feeling that their work is important and contributes to end results. Basically, managers must make employees feel that they are valued in the total effort. For employees, performing at superior levels generally reflects the satisfaction of various personal needs – social, psychological, self-fulfillment*, etc.

Communication. In order for leadership and motivation to be effective, the manager must be able to communicate well with subordinates, and encourage feedback from them. A lack of effective communication leads to artificial barriers where there is little understanding between managers and subordinates, and where operational results are based on abuses of authority* rather than strong leadership and motivation. In the latter case, operational results are generally less fruitful than they might otherwise have been.