Areas of Management

It is convenient to classify the kinds of managers into three categories: 1) administrators and managers; 2) line managers and staff managers; 3) general managers and functional managers.

Administrators and managers. In fact, these terms are basically equivalent. The main distinction is that administrators are managers who work in public or nonprofit organizations, like hospital administrators, while managers are engaged in business areas.

Line managers and staff managers. Line managers have responsibility for work activities that are directly connected with the production of the organization’s final product or service. Their efforts influence the process of transforming resource inputs into product or service outputs. The president, production manager, and production supervisor all have line responsibilities. Staff managers, by contrast, use their special technical knowledge to support the work of line personnel.

General managers and functional managers. General managers are responsible for complex organizational subunits that include multiple functional areas of activity, whereas functional managers have responsibility for a single area of activity such as finance, marketing, production, personnel, accounting or sales. Compare the general manager of a department store who oversees purchasing, warehousing, sales, personnel and accounting, and the sales manager, who is directly responsible for sales only.

Functional managers have various areas of specialization. The most common areas of management are marketing, operations, finance, and human resources.

Marketing managers are those whose primary duties are related to the marketing function – getting whatever the organization produces (automobiles, magazines, dairy products) into the hands of consumers. They conduct market research, plan advertising campaigns, set prices and oversee distribution networks.

Finance managers deal with the organization’s financial resources. Their areas of concern include accounting, cash management and investments. They are responsible for maintaining and providing relevant information to the CEO about the organization’s financial health.

Operations managers are primarily concerned with creating the organization’s goods and services. Their typical responsibilities include production control, inventory control, quality control, and plant layout.

Human resource managers, or HRM, are responsible for hiring, maintaining and discharging employees. They are typically involved in human resource planning, employee recruitment and selection, training, designing compensation and benefit systems, and discharging low-performing and problem employees.

Functions of Management

Management functions are the sets of activities inherent in most managerial jobs. These activities can be grouped into four general functions: planning and decision making, organizing, leading and controlling.

Planning and decision making involve determining the organization’s goals and deciding how best to achieve them. The purpose of planning is to provide managers with a programme of what they should be doing in the future.

The second basic managerial function is organizing. Organizing is a process of allocating human and material resources in appropriate combinations to implement plans. Organizing turns plans into action by defining tasks, assigning personnel, and supporting them with resources.

The third basic function inherent in manager’s job is leading – the set of processes associated with guiding and directing employees toward goal attainment. Key parts of leading are motivating employees, managing group processes, and dealing with conflict and change.

The final basic managerial function is controlling. Controlling is the process of monitoring performance, comparing results with goals, and taking corrective action. Controlling involves gathering and interpreting performance feedback as a basis for constructive action and change.

Another way to keep the four functions in mind is to think of them as of a series of task-related decisions made by managers. These decisions are:

• Planning – Deciding what must be done.

• Organizing – Deciding how it must be done and who has to do it.

• Leading – Deciding how to make sure it gets done.

• Controlling – Deciding if it is or it is not getting done, and what to do if it isn’t.

Responsibility for the four management functions rests with all managers working in all types of organizations. Research shows, however, that time spent on planning and organizing tends to increase at higher management levels; time spent on controlling is proportionally greater at lower management levels; time spent on leading is relatively similar at each management level.