LEVELS OF MANAGEMENT

As we have already learnt that management does not refer to a single individual but it refer to a group of persons. In companies large number of persons are employed and placed at different places to perform different managerial activities. To carry on these activities these employees are given necessary authority and responsibility. This grant of authority results in creation of chain of authority. This chain is divided into three levels which result in creation of three levels of management.

The main levels of management are:

    1    Top level management.

    2    Middle level management.

    3.  Supervisory level, operational or lower level management.

        Top Level Management

Top level management consists of Chairman, Board of Directors, Managing Director, General Manager, President, Vice President, Chief Executive Officer (C.E.O.), Chief Financial Officer (C.F.O.) and Chief Operating Officer etc. It includes group of crucial persons essential for leading and directing the efforts of other people. The managers working at his level have maximum authority.

Main functions of top level management are:

a)      Determining the objective of the enterprise. The top level managers formulate the main objectives of the organization. They form long term as well as short term objectives.

b)      Framing of plans and policies. The top level managers also frame the plans and policies to achieve the set objectives.

c)      Organizing activities to be performed by persons working at middle level. The top level management assign jobs to different individuals working at middle level.

d)      Assembling all the resources such as finance, fixed assets etc. The top level management all the finance required to carry on activities in the organization.

e)      Controlling the performance of employees. The top level management keeps a check on employees and their performance. They make sure that plans are implemented in the right direction.

f)        Liaison with outside world, for example, meeting Government officials etc. The top level management remain in contact with government, competitors, suppliers, media etc.

Middle Level Management

This level of management consists of departmental heads such as purchase department head, sales department head, finance manager, marketing manager, executive officers, plant superintendent etc. People of this group are responsible for executing the plans and policies made by top level. They act as a link between top and lower level management. They also exercise the functions of top level for their department as they make plans and policies for their department, organize and collect the resources etc.

Main functions of middle level management are:

a)  Interpretation of policies framed by top management to lower level. Middle level management act as a linking pin between top level and lower level management. They only explain the main plans and policies framed by top level management to lower level

.

b)   Organizing the activities of their department for executing the plans and policies. Generally middle level managers are head of some department. So they organise  all the resources and activities of their department.

c)  Finding out or recruiting/selecting and appointing the required employees for their department. The middle level management select and appoint employees of their department.

d)   Motivating the persons to perform to their best ability. The middle level managers offer various incentives to employees so that they can get motivated and perform to their best ability.

Supervisory Level /Operational Level

      This level consists of supervisors, superintendent, foreman, sub-department executives, clerk etc. Managers of this group actually carry on the work to perform the activities according to the plans of top and middle level management. Their authority is limited. The quality and quantity of output depends upon the efficiency of this level of managers. They pass on the instruction to workers and report to the middle level management. They are also responsible for maintaining discipline among the workers.

      

      Functions of lower level management are:

a)      Representing the problems or grievances of workers before the middle level management. The supervisory level managers are directly linked with subordinates so they are the right persons to understand the problems and grievances of subordinates. They pass these problems to middle level management.

b)      Maintaining good working conditions and developing healthy relations between superior and subordinate. The supervisory managers provide good working conditions and crate supportive work environment which improve relations between supervisors and subordinates.

c)      Looking to safety of workers. Supervisory level managers provide safe and secure work environment for workers.

d)      Helping the middle level management in recruiting, selecting and appointing the workers. The supervisory level managers guide and help the middle level managers when they select and appoint employees.

e)      Communicating with workers and welcoming of their suggestions. The supervisory level managers encourage the workers to take initiative. They welcome their suggestions and reward them for good suggestions.

f)       They try to maintain precise standard quality and ensure steady flow of output. The supervisory level managers make sure that quality standards are maintain by the workers.

g)      They are responsible for boosting the morale of the workers and developing the team spirit in them. They motivate the employees and boost their morale.

Management: Both Science and Art

Management is both science as well as art. Like science it has systematic and well-organised body of knowledge and like art it requires personal skill, creativity and practice to apply such knowledge in the best possible way. Science and art are not in contrast to each other; both exist together in every function of management.

 Management as a Profession

Profession can be defined as an occupation backed by specialized knowledge and training, in which is restricted.

The main features of profession are:

1. Well defined Body of knowledge. In every profession there is practice of systematic body of knowledge which helps the professionals to gain specialized knowledge of that profession. In case of management also there is availability of systematic body of knowledge. There are large numbers of books available on management studies. Scholars are studying various business situations and are trying to develop new principles to tackle these situations.

2. Restricted Entry.   The entry to a profession is restricted through an examiner or degree. For example a person can practice as Doctor only when he is having M.B.B.S degree. Whereas there is no legal restriction on appointment of a manager, anyone can become a manager irrespective of the educational qualification. But now many companies prefer to appoint managers only with MBA degree. So presently this feature of profession is not present in management but soon it will be included with statutory backing.

3. Service Motive. The basic motive of every profession is to serve the clients with dedication. Whereas basic purpose of management is achievement of management goal, for example for a business organization the goal can be profit maximization.

But nowadays only profit maximization cannot be the sole goal of an enterprise. To survive in market for a long period of time, a businessman must give due importance to social objectives along with economic objectives. 

So presently this feature of profession is not present but very soon it will be included.

4. Existence Of Ethical Codes.  For every profession there are set of ethical codes fixed by professional organizations and are binding on all the professionals of that profession. In case of management there is growing emphasis on ethical behavior of managers. All India Management Association (AIMA) has devised a code of conduct for Indian managers. But legally it is not compulsory for all the managers to get registered with AIMA and abide by the ethical codes.

So presently this feature of profession is not present in management but very soon it will be included with statutory backing.  

5. Presence Of Professional Associations.  For all the professions, special associations are established and every professional has to get himself registered with his association before practicing that profession. For example, doctors have to get themselves registered with Medical Council of India, lawyers with Bar Council of India etc.

In case of management various management associations are set up at national and international levels which have some membership rules and set of ethical codes, for example, AIMA in New Delhi, National Institute of Personal Management at Calcutta etc., but legally it is not compulsory for managers to become a part of these organizations by registration.

So presently this feature of profession is not present in management but very soon it will be included and get statutory backing also.

1.5.2

Management as an Art

Art can be defined as a systematic body of knowledge which requires skill, creativity and practice to get perfection.

The main features of art are:

1.      Systematic body of knowledge/Existence of theoretical knowledge. In every art there is systematic and organized study material available to acquire theoretical knowledge of the art. For example, various books on different ragas are available in music. In management also there is systematic and organised body of knowledge available which can help in acquiring managerial studies. So this feature of art is present in management also.  

                          

2.      Personalized application. In the field of art only theoretical knowledge is not enough. Every artist must have personal skill and creativity to apply that knowledge. For example, all musicians learn some ragas according to their personal skill and creativity which makes them different. In management also all managers learn same management theories and principles. But their efficiency depends how well they use these principles under different situations by applying personal skills and creativity so this feature of art is present in management.  

       

1.5

NATURE OF MANAGEMENT

Some authors regard management as science because there are well tested and experimented principles of management, some authors describe management as an art because more practice      is required in management and some authors consider that management is going towards the paths of profession. To conclude whether management is science, art and profession and compare them with management meaning and features.

 Management as a Science

Science can be defined as a systematic and organised body of knowledge based on logically observed findings, facts and events.

Science comprises of exact principles which can be verified and it can establish cause and effect relations.

Main characteristics/features of science are:

                                      

1.      Systematic body of knowledge. In science organised and systematic study of material is available which is used to acquire the knowledge of science. Like science in management also there is availability of systematic and organised study material. So first feature of science is present in management.

2.      Scientific principles are derived on the bases of logical and scientific observations. The scientists perform logical observation before deriving any principle or theory. They are very objective while doing the observations. But when managers are observing they have to observe human beings and observation of human being cannot be purely logical and objective. Some kind of subjectively enters in the observations so this feature of science is not present in management.

3.      Principles are based on repeating experiments. Before developing scientific principles scientists test these principles under different conditions and places. Similarly, managers also test and experiment managerial principles under different conditions in different organizations. So this feature of science is present in management.

4.      Universal Validity. Scientific principles have universal application and validity. Management principles are not exact like scientific principles so their application and use is not universal. They have to modify according to the given situation. So this feature of science is not present in management.

5.      Replication is possible .In science replication is possible as when two scientists are undertaking the same investigation working independently and treating the same data under the same conditions may desire or obtain the identical or exactly same result. 

But in management managers have to conduct research or experiments on human beings. So if two managers are investigating same data, on different sets of human beings they will not get identical or same result because human beings never respond in exactly identical manner. So this feature of science is also not present in management.

Good Management Makes A Good Professional Working Environment

1.4

Importance Of Management

The major importance of management are :

1. Management helps in achieving group goal: Management tries to integrate the objectives of individuals along with organisational goal. Management directs the efforts of all the individuals in the common direction of achieving organisational goal.

2. Management improves efficiency: Managers try to reduce the cost and improve the productivity with minimum wastage of resources. Management insists on efficiency and effectiveness in the work through planning, organizing, staffing, directing and controlling.

3. Management creates a dynamic organisation: Organisations have to survive in dynamic environment so managers keep making changes in the organisation to match the environmental changes. The employees in the organisation are generally resistant to change. Efficient management motivate employees to adopt changes willingly by convincing them that change is not only beneficial for organisation but it improve the employee's work also in the competitive world.

4. Management helps in achieving personal objectives: An efficient manager is the one who brings maximum prosperity for employer and employees as well. Manager lead the people in such a manner that along with organisational goal individual goal of employees is also achieved. As organisational goal and individual goal are in one direction only. Individual wants to earn more and organisation wants maximum production. Employees can earn more by producing more. This will fulfill the objectives of both the groups.

5. Management help in developing of society: Efficient management always has multiple objectives, they give due importance to social obligations, towards different groups of people such as employees, customers, suppliers etc. It insists on providing quality goods, competitive salary, create employment opportunities etc. By increasing production management also contributes to increase in GDP (gross domestic product) and leads to growth of nation .

6. Management brings harmony in work: In an organisation employees come from different backgrounds, they have different attitudes and different styles of working and if every one start following his own style, it can lead to chaos and confusion in the organisation. By giving directions managers bring uniformity and harmony in the action of employees.  

                           Objectives Of Management

Objectives are the ends towards which the activities of an organisation are directed and the standards against which the performance is assessed.

The managerial objectives of an organisation can be classified into three major categories :

1. Organisational Objectives 

2. Social Objectives

3. Personal Objectives

1.3.1    

Organisational Objectives

These objectives aim at prosperity and growth of the organisation. Generally it is assumed that profit maximization is the main objective of every organisation but it is not true. The managers try to develop and attain variety of objectives in all management areas which reduces cost and brings maximum prosperity for organisation.

The three important organisational objectives of a manager are :

1. Survival:  The basic purpose of every organisation is to survive and exist in the competition market for a long period of time and it is possible only when it is able to cover its cost and earn profits.

2. Profit: The most important objectives of every organisation is earning adequate amount of profit. Profit is essential for survival, growth and expansion of business. Profit is the reward given to businessman for bearing risk.

 3. Growth: Business organisation must grow and expand their activities. The success of any organisation is measured by the growth rate and growth is measured in terms of sales, number of branches, number of products, number of employees etc.

1.3.2 

Social Objectives

Social objectives of the organisation deal with the commitment of the organisation towards the society. Business organisations are the part of society. They earn by using the resources of society so they must do something for society also.

The major social objectives of organisation are :

(a)  Supply of quality products at reasonable prices.

(b)  Contribution towards desirable civic activities.

(c)  Generation of economic wealth.

(d)  Generation of employment opportunities.

(e)  Financial support to community.

(f)  Organizing educational, health and vocational train programmers.

(g) Participating actively in social service projects of Govt. and N.G.Os.

(h) Using environmental friendly methods of productions.

(i)  Providing employment opportunities to weaker section of society.

For example, Asian Paints contributed large amounts funds to enable farmers to use local resources effectively

Steel Authority of India Ltd. contributed regularly for agriculture, industry, education, health, care and drinking water supply to the people living nearby their steel plants.

1.3.3

Personal Objectives

Individual objectives are related to the employees of the organisation. As employees are most important resources of every company and satisfied and motivated employees contribute maximum for the organisations.

The main individual objective of management are :

(a) Competitive salary

(b) Personal growth and development (promotion, training etc.)

(c) Peer  recognition (self respect and respect for colleagues.) 

(d) Good and Healthy working conditions.

(e) Social recognition.

Workers may lose interest in work if their objectives are neglected. Management must try to integrate the personal objectives with the organisational objectives. 

1.2 Characteristics Or Features Of management

1: Management is goal oriented process: Management always aims at achieving the organisational objectives. The functions and activities of manager lead to the achievements of organisational objectives; for example, if the objective of a company is to sell 1000 computers then manager will plan the course of action, motivate all the employees and organize all the resources keeping in mind the main target of selling 1000 computers.

2: Management is Pervasive: Management is a universal phenomenon. The use of  management is not restricted to business firms only, it is applicable in profit-making, non-profit making, business or non-business organisations ; even a hospital, school, club and house has to be managed properly. Concept of management is used in the whole world whether it is in USA, UK, Australia or India etc.

3: Management is Multidimensional: Management does not mean one single activity but it includes three main activities:

•  Management of work
• Management of people 
• Management of operations

(i) Management of work: All organisations are set up to perform some task or goal. Management activities aim at achieving goals or tasks to be accomplished. The task or work depends upon the nature of Business for example  work to be accomplished in a school is product. Management makes sure that work is accomplished effectively and efficiently.

(ii) Management of people : People refers to human resources and human resources are the most important assets of an organisation. An organisation can win over competitor with efficient employees only because two organisations can have same physical, technological and financial resources but not human resources. Management has to get task accomplished through people only.

Managing people has two dimensions

(a) Taking care of employee's individual needs.

(b) Taking care of group of people

4: Management is a continuous process: Management is a continuous or never ending function. All the functions of management are performed continuously, for example planning, organizing, staffing, directing and controlling are performed by all the managers all the time. Sometimes, they are doing planning, then staffing or organizing etc. Managers performs ongoing series of functions continuously in the organizing.

5: Management is a group activity: Management always refers to a group of people involved in managerial activities. The management functions cannot be performed in isolation. Each individual performs his/her role at his/her status and department,then only management function can be executed. Even the result of management affects every individual and every department of the organisation so it always refers to a group effort and not the individual effort of one person.

6: Management is dynamic function : Management has to make changes in goal, objectives and other activities according to changes taking place in the environment. The external environmental such as social, economical, technical and political environment has great influence over the management. As changes take place in these environments, same are implemented in organisation to survive in the competitive world.

7: Intangible: Management functions cannot be physically seen but its presence can be felt. The presence of management can be felt by seeing the orderliness and co-ordination in the working environment. It is more easy to feel the presence of mismanagement as it leads to chaos and confusion in the organisation.

8: Composite process: Management consists of series of functions which must be performed in a proper sequence. These functions are not independent of each other. They are inter -dependent on each other. As the main function of management are planning, organizing, directing, and controlling ; organizing cannot be done without doing planning. similarly directing function cannot be executed without staffing and planning and it is difficult to control the activities of employees without knowing the plan. All the functions inter-dependent on each other that is why management is considered as a composite process of all these functions. 

9: Balancing effectiveness and efficiency: Effectiveness means achieving targets and objectives on time. Efficiency refers to optimum or best utilization of resources. Managements always try to balance both and get the work done successfully. Only effectiveness and only efficiency is not enough for an organisation : a balance must be created in both.

INTRODUCTION

Management is necessary for all the organisations irrespective of its size, nature and functions. The concept of management is not restricted to business organisation but not even non-business organisation needs to manage its functions. Management is a pervasive and universally accepted function.

No organisation can work smoothly and efficiently without management.

Few examples are:

•  Infosys has become a leading IT Company due to managerial efficiency of Narain Murthy and his managerss
• HCL has grown into a big and famous company because of its management.
• Wipro is running successfully due to managerial efficiency of Assem Premjee and his group of managers.
• Pepsi, Coke, Reliance are running due to efforts of management.

Management is essential for all types of organisations i.e business as well as non-business and when we talk management it, includes series of activities performed by managers by working at different levels.

1.1

Concept Of Management (Meaning and Definition)

To understand the concept of management we must know the meaning of management.

Management is defined differentyly by different authors.

Traditionally Management was Defined as 

1 "Management is the art of getting work done through others".

                                                                                                             Mary Parker Follet

2 "Management consists of getting things done through others". A manager is one who accomplishes       organisational objectives by directing the efforts of others.

                                                                                                            C.S George

The Traditional Viewpoint of management is considered inappropriate in the present day environment where workers are educated and have higher level of aspirations. In present day environment it is not possible  to direct the efforts of employees by force. It is necessary to create an environment so that employees perform in a desired manner ; on the other hand,traditional definition does not define functions of management.

Definition by different authors {Modern Concept}

1 "To manage is to forecast, to plan to organize, to command, to coordinate and to control".

2 "Management is the creation of an internal environment where individuals working in a group can perform effectively and efficiently for the achievement of organisational goal".

3 "Management is establishing an effective environment for people operating in a formal organisational group".

                                                                                                     Koontz and O'Donnel    

4 "Management is the art of knowing exactly what you want your men to do and then seeing that they do it in the best and cheapest way".

                                                                                                    James  L. Ludney

5 "Management is the co-ordination of all resources through the process of planning, organizing, directing and controlling in order to attain stated objectives".

                                                                                                    F.W. Taylor

6 "Management is the process by which a co-operative group directs actions of others towards common goals".

                                                                                                     Marrie and Douglas

Modern Concept of Management

According to modern concept "management is a process of getting things done with the aim of achieving goals effectively and efficiently".

Modern definition insist on  :

1. Process: Process refers to the series of steps or basic functions necessary to get the things done. These steps are planning, organizing, staffing, directing and controlling.

2. Effective and efficient performance: Modern concept of management says that employees must be effective as well as efficient. Effectiveness refers to completion of work or achievement of target on time. Efficiency refers to optimum utilization of resources or no wastage of resources, both are must for every organization ; for example, if the annual target of a worker is to produce 1000 units of output, the employee achieves this target by wasting various resources and by mishandling the machinery then the organization will have no benefit so only effectiveness is not required. It must be accompanied by efficiency.

3: Achievement of group, common or organisational goal: The modern concept of management insist that all the functions and activities of managers must be directed towards the achievement of organisational goal  and this goal should be the goal of every employee and must be considered as group or common goal.

  

 NATURE AND SIGNIFICANCE OF MANAGEMENT

1.1 Concept of Management (Meaning and Definition)
1.2 Characteristics or Features of Management
1.3 Objectives of Management

1.4 Importance of Management

1.5 Nature of Management 

1.6 Levels of Management

1.7 Functions of Management

1.8 Co-Ordination

                                   Business Studies 

Contents 

Part A : Principles and Functions Of Management

1: Nature and Significance of Management 

2: Principles of Management

3: Business Environment

4: Planning

5: Organizing

6: Staffing

7: Directing

8: Controlling