Principles of Management


•Management: Management is 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.
•Efficient: Using resources wisely and in a cost effective way.
•Effective: Making the right decisions and successfully implementing them.
•Manager: A manager is someone whose primary responsibility is to carry out the management process. In particular, a manager is someone who plans and makes decisions, organizes, leads, and controls human, financial, physical, and information resources.

The Management Process:

Management involves four basic functions:

•Planning and Decision Making:

—Planning means setting an organization’s goals and deciding how best to achieve them.

— Decision making, a part of the planning process, involves selecting a course of action from a set of alternatives.


— Organizing means grouping activities and resources in a logical fashion.


— Leading is the set of processes used to get people to work together to advance the interests of the organization.


— Controlling means monitoring organizational progress toward goal attainment.


Kinds of Managers

1. Managers at Different Levels of the Organization:

Top Managers:

•Top managers make up the relative small group of executives who manage the overall organization.
•Titles found in this group include president, vice president, and chief executive officer (CEO).
• An organization’s top managers establish its goals, overall strategy, and operating policies.
•They officially represent the organization to the external environment by meeting with government officials, executives of other organizations, and other parties important to the organization.
•The job of a top manager is likely to be complex and varied.
•Top managers make decisions about such activities as acquiring other companies, investing in research and development, entering or abandoning various markets, and building new plants and office facilities.

Middle Managers:

•Middle managers is probably the largest group of managers in most organizations.
•Common middle-managers titles include plant manager, operations manager, and division head.
•Middle managers are primarily responsible for implementing the policies and plans developed by top managers and for supervising and coordinating the activities of lower-level managers.

First-Line Managers:

•First-line managers supervise and coordinate the activities of operating employees.
•Common titles for first-line managers are supervisor, coordinator, and office manager.
•In contrast to top and middle managers, first-line managers typically spend a large proportion of their time supervising subordinates.

Managers in Different Areas of the Organization

Marketing Managers

•Marketing managers work in areas related to the marketing function—getting consumers and clients to buy the organization’s products or services.
•They are responsible new product development, promotion, and distribution.

Financial Managers

•Financial managers deals primarily with organization’s financial resources.
•They are responsible for activities such as accounting, cash management, and investments.

Operations Managers

•Operations managers are concerned with creating and managing the systems that create an organization’s products and services.
•Typical responsibilities of operating managers include production control, inventory control, quality control, plant layout, and site location.

Human Resource Managers

•Human resource managers are responsible for hiring and developing employees.
•They are typically involved in human resource planning, recruiting, and selecting employees, training and development, designing compensation and benefit systems, formulating performance appraisal systems, and discharging low-performing and problem employees.

Administrative Managers

•Administrative, or general, managers are not associated with any particular management specialty.
•They tend to be generalists; they have some basic familiarity with all functional areas of management rather than specialized training in any one area.

Other Kinds of Managers

•Public relations managers, for example, deal with the public and media for  firms.
•Research and Development managers coordinate the activities of scientists and engineers working on scientific projects in organizations.


Regardless of their level or area within an organization, all managers must play certain roles and exhibit certain skills if they are to be successful.


According to Henry Mintzberg, managers play ten different roles and that these roles fall into three basic categories: interpersonal, informational and decisional.

Interpersonal Roles:

•Interpersonal roles entail the role of figurehead, leader, and liaison, which involve dealing with other people.
•The manager is often asked to serve as a figurehead—taking visitors to dinner, attending ribbon-cutting ceremonies, and the like. These activities are typically more ceremonial and symbolic than substantive.
•The manager is asked to serve as a leader—hiring, training, and motivating employees. That is, encouraging employees to improve productivity.
•Managers can have a liaison role. This role involves serving as a coordinator or link between people, groups, or organizations.

Informational Roles:

The roles of monitor, disseminator, and spokesperson, which involve the processing of information.

•The first informational role is that of monitor, one who actively seeks information that may be of value. The manager questions subordinates, is receptive of unsolicited information, and attempts to be as well informed as possible.
•The manager is also disseminator of information, transmitting relevant information back to others in the workplace.
•The spokesperson formally relays information to people outside the unit or outside the organization.

Decisional Roles:

Decisional roles are the roles of entrepreneur, disturbance handler, resource allocator, and negotiator, which primarily relate to making decisions.

•Entrepreneur is the voluntary initiator of change.
•Manager responds to her role as disturbance handler by handling such problems as strikes, copyright infringements, and energy shortages.
•As resource allocator, the manager decides how resources are distributed, and with whom he or she will work most closely.
•As negotiator, manager enters into negotiations with other groups or organizations as a representative of the company. (e. g., with union contract, an agreement with a consultant, or a long-term relationship with a supplier). It may also be internal: e.g., mediate a dispute between subordinates, negotiate with other department.


One classic study revealed three important types of managerial skills: technical, interpersonal, and conceptual.

Technical Skills:

•Technical skills are skills necessary to accomplish or understand the specific kind of work being done in an organization.
•Project engineers, physicians, and accountants all have the technical skills necessary for their respective profession.
•They each develop basic technical skills by completing recognized programs of study at colleges and universities.
•These skills are specially important for first-line managers.

Interpersonal Skills:

•The ability to communicate with, understand, and motivate both individuals and groups is referred to as interpersonal skills.
•Managers spend considerable time interacting with people both inside and outside the organization.
•Thus managers must be able to get along with subordinates, peers, and those at higher levels of the organization.
•A manager must also be able to work with suppliers, customers, investors, and others outside the organization.

Conceptual Skills:

•It is the manager’s ability to think in the abstract.
•Managers need the mental capacity to understand the overall workings of the organization and its environment, to grasp how all the parts of the organization fit together, and to view the organization in a holistic manner.

Diagnostic Skills:

•A manager’s ability to visualize the most appropriate response to a situation.
•As a physician, a manager can diagnose and analyze a problem in the organization by studying its symptoms and then developing a solution.
•The Science and the Art of Management

The Science of Management:

•Many management problems and issues can be approached in ways that are rational, logical, objective, and systematic.
•Managers can gather data, facts and objective information.
•They can use  quantitative models and decision-making techniques to arrive at a ‘correct’ decision.
•They need to take such a scientific approach to solving problems whenever possible, especially when they are dealing with relatively routine and straightforward issues.

The Art of Management:

•Even though managers may try to be scientific as much as possible, they must often make decisions and solve problems on the basis of intuition, experience, instinct, and personal insights.
•Relying heavily on conceptual and interpersonal skills, a manager may have to decide between multiple courses of action that look equally attractive.

Classical Management Perspective

Scientific Management:

•Frederick Winslow Taylor (1856—1915) is said to be the father of scientific management.
•Scientific management is concerned with improving the performance of individual workers. The four steps of scientific management are:

—Develop a science for each element of the job to replace old rule-of-thumb methods.

—Scientifically select employees and then train them to do the job as described in step 1.

—Supervise employees to make sure they follow the prescribed methods for performing their jobs.

—Continue to plan the work, but use workers to actually get the work done.

Administrative Management:

•Administrative management focuses on managing the total organization.
•The primary contributors to administrative management were Henri Fayol, Lyndall Urwick, Max Weber, and Chester Bernard.
•Henri Fayol was administrative management’s most articulate spokesperson. His fourteen principles of management are as follows:

1. Division of labor;

2. Authority and responsibility

3. Discipline:

4. Unity of command;

5. Unity of direction;

6. Subordination of individuals to the common goal;

7. Remuneration;

8. Centralization;

9. Scalar chain;

10. Order;

11. Equity;

12. Stability;

13. Initiative;

14. Team spirit.