Module

Project1MANAGEMENT
Organization •“Management as a discipline has attracted the attention of Line Organization doing as they were directed.6.Coordinating:Means achieving harmony Line and Staff Organization
of individual effort goals for his organisation, for himself and for his team. This skill seems to increase in
academicians and practitioners
Project organization is nottoaa separate
very great type
extent.”
ofIMPORTANCE
organizationOF likeMANAGEMENT
the line, • It is perhaps the oldest and the simplest
towards the organizational
accomplishment of company objectives.Make plansIttoisregulate
structure. a combination
the activities of and
line and functional structures. importance as a manager moves up to higher positions of responsibility in the
Management
functionalisora line critical element
and staff inorganization;
the economic rathergrowth of
it the
is setcountry.•Management
up within an is Line functions are those which have direct responsibility for accomplishing the
communication of subordinates on the job.Informal relationships Under
within this
the organization
organization alwaysthe “line” authorities is supported by the “staff”.
organisation.2.Technical Skil:The technical skill is the manager's understanding of the nature of
essential in all organized efforts, be it a business activity or any other activity.•Management is
organization for the purpose of completing a project or accomplishing assigned objective of the enterprise. tend to facilitate coordination7.Controlling:Controlling involves identificationStaff personnel of actual acts as an advisory group adjacent to the line. job that people under him have to perform.It refers to a person's knowledge and proficiency in
the dynamic, life giving element in every organization.Definitions•According to Mary Parker
objectives in time and within cost and profit goals laid down by the management. results,comparison of actual results
In this kind of structure every manager exercise a direct authority over his with expected results as setIn
by this organization
planning structure, the authority flows in a vertical line andtype
any gets
of process or technique.In a production department, this would mean an understanding
Follet, Management is the art of getting things done through people.•According to Harold process,identification
subordinate who in turn directly reports of deviation between the two, if any and taking
to their superiors. the help of corrective
of staffaction so thatwho are in advisory.
specialist of the technicalities of the process of pro-duction.Whereas this type of skill and competence
The project structure consists of a number of horizontal organizational units
Koontz,Management is the art of getting things done through and with the people in formally actual results match with expected results.–1.Set standards–2.Measure Jobline
performance – need advice, information about any specific
to complete projects of a long duration. There is a hierarchical arrangement ofauthority. When the executives seems area,
to be more important at the lower levels of management, its relative importance as a
organized groups•According to Dalton E McFarland,Management is defined for conceptual, 3.Take corrective action 8.Decision Making : It is the process bythese which staff
a course of action is
specialists are consulted. part of the managerial role diminishes as the manager moves to higher positions.In higher
A team of specialists from different areas isbycreated for eachcreate,direct,maintain,
project. Each department is self-contained and works independently of other departmt
theoretical, and analytical purposes as that process which managers consciously chosen from a available alternatives for the purposeAdvantages of achieving desired results. • functional positions, such as the position of a marketing manager or pro-duction manager,the
andUsually
operatethis team is
purposive managedthrough
organization by thesystematic,coordinated,co-operative
project manager. human effort.•
Lines of authority are vertical i.e.Anfrom top to bottom.
out standing quality of a successful manager is his ability to make Line sound
managers are provided expert advice by these specialists. conceptual component, related to these functional areas becomes more important and the
and logical
The project staff is separate from and independent of the functional departmnt There are no staff specialists. decisions.MANAGERICAL ROLES Managerial roles refer to managerial Staff managers provide specialist advice which can improve quality of
Advantages
According to George R Terry, Management consists of planning, organizing, actuating and Advantages activities.This can be
technical component becomes less important.3.Human Realtion Skill:Human relations skill is
controlling,
Special performed
attentiontocan determine and accomplish
be provided to meet the theobjectives
complexbydemand the use ofof people and
the project. Simple to establish and operategrouped in to three.•Interpersonal Role>The figure head role:perform decisions in various
ceremonial departments.
and social
the ability to interact effectively with people at all levels.This skill develops in the manager
resources. Need For Management •Society has large and complex institutions with many Disadvantages
It allows maximum use of specialist knowledge thus chances of failure arepeople Promotes prompt decision making.
duties>The Leader Role >The Liaison Role:with outsiders•Informational Role>The recipient
sufficient ability(a)to recognise the feelings and sentiments of others;(b)to judge the possible
working together•The relationship between managers and managed has changed as compared Role:receiving information about the operation of an enterprise>The Linedisseminator
managersRole:passing
and staff managers might have conflicts on particular
very less. Easy to control as the managersinformation
have direct control over their subordinates. reactions to, and outcomes of various courses of action he may undertake;and(c)to examine his
to the older master-servant relation ship making it more complex•People have greater to subordinates>The spokesperson Role:transmittingissues. information to outside
Project staff works as a team towards common goal which results in hig Communication is fast and easy•Decision
as thereRole>The
is only vertical flow of communication.
expectations from their jobs.“In order to make all these things function properly, people have entrepreneurial Role >The disturbance–handler LineRole>The
and staff managers might not be clear as to what the actualown
resource areaconcepts and values which may enable him to develop more useful attitudes about himself.
h motivation level for its members. Disadvantages
been trying to evolve some methods and techniques.Such attempts have given the birth of allocator Role>The negotiator Role.LEVELS OF MANAGERS:TOP-LEVELMANAGERS•Most of operations is and what is expected of them. Co-ordination may This be atype of skill remains consistently important for managers at all levels.
problem.
Disadvantages Lack of specialization. EVOLUTION OF MANAGEMENT THOUGHTS • CLASSICAL MANAGEMENT THEORIES •
management as a separate discipline” Management Functions or Process of Management people who enter the field of management aspire to become top-level Line function:
managers—managers at
As the project staff consists thatofallpersonnel from diverse fields,should
it might be quite Managers might get overloadedthe with
top too
one many thingsin to
an do.
organization.•Top-level managersLine NEO-CLASSICAL MANAGEMENT THEORIES • MODERN MANAGEMENT THEORIES
“Management process suggests the managers in the organization perform certain or two levels managerstoare
are empowered makedirectly
major responsible for the achievement of
challenging
Matrix
functions Organization
to for the
get things project
done manager
by others”. to coordinate
Management Functions among them. is necessary
1.Forecasting:It Failure of one manager to take decisions
proper decisions might
affecting the affect
present and the
futureorgnistion
of the firm.•Only a top-level manager, forobjectives.
example, CLASSICAL THEORIES•F.W Taylor’s SCIENTIFIC MANAGEMENT THEORY•Henry Fayol’s
Functional Organization organizational ADMINISTRATIVE MANAGEMENT
Matrix organization
preliminary combinesestimates
to planning.Forecasting two structures
what should functional
be done instructure and begins
future.Forecasting would have the authority to purchase another company,initiate a new product line,or hire 10. Order:THEORY.•Max Weber’s BUREAUCRACY THEORY. F.W
with sales forecast,and Under this system, the whole task of management and direction of are the people who Staff function: Taylor’s SCIENTIFIC MANAGEMENT • This principle THEORY 1.Time
deals withandtheMotion study.2.Differential
arrangement of things and persons.
project structure. is followed by production forecast and forecasts for costs finance, hundreds of employees.•Top-level managers
(i)give the organization its
Staff managers are those individuals or groups in an organization who
purchase, profit/loss etc.2.Planning:It is the conscious determination of the future course subordinates is divided according to direction;they
the type of work decideinvolved. Payment.3.Drastic Reorganization of supervision.4.Scientific Recruitment and Training.5.
• Two types:
Functional department is a permanent feature of the matrix structure andof general where it is going and how it will get there.•The terms executive
provide services and advice to line managers in performing their Intimate functions.
action to achieve the desired results.What to achieve?When to achieve?How The organization is divided into
anda top-level
numbermanager
of functional
can be areas. friendly cooperation between management and workers.F.W Taylor’s SCIENTIFIC
• 1. Material order: A place for everything and everything in its place.
retains authority for overall operation of the functional units. to achieve?.It used interchangeably.MIDDLE-LEVELMANAGERS•Middle-level
(ii) The nature of staff relationship is advisory. It is for the line managers to
includes determination of objectives, setting rules and procedures, determining projects,setting This organization has grouping of activities
managers in accordance
are managers who are with
neithertheexecutives nor first-level supervisors,but who serve as MANAGEMENT THEORY1.Science, not rule of thumb.2.Harmony, not discord.3.Cooperation,
• 2. Social order: A place for everyone and everyone in his place.
Project teams are created whenever specific projects require a high degree of decide whether to take any decision with respect to the given advice. not individualism.4.Maximum output not restricted output.5 Specialization,not generalization.6.
policies and strategies, budgeting etc.3.Organizing:it is the process of dividing work in to functions of an organization such
a linkas production,
between the two marketing, finance,managers conduct most
groups.•Middle-level of the coordination • Scientific selection, training and placement are necessary so that
technical skill and other resources for a temporary period. (iii)and
Staff personnel
convenient tasks or duties,grouping of such duties in the form of positions,and grouping of human resource and so on. activities within the firm,and they disseminate information to upper FACTORS lower levels.•Thelack
AFFECTING SPAN
jobs the authority to implement their solutions
of CONTROL themselves.
Scientific selection,training and development of persons not on personal judgment.Henry
Project team from the horizontal chain and functional departments create a Fayol’s ADMINISTRATIVEmaterials MANAGEMENT can beTHEORY
easily taken outofand
1.Division men can be and
work.2.Authority easily located
various positions in to departments and sections and delegating authority to each position so The specialist in charge of a functional
middle-leveldepartment
managers vary has the authority
substantially in terms of responsibilitya)and income.A
Capacity ofbranch
Subordinates: Efficient and trained subordinates affect the
that the work is carried out as planned.4.Staffing:Here the Managers/HR department over all other employees for his function.
manager in a large firm might be responsible for over 100 workers.In contrast,a general Responsibility.3.Discipline.4.Unity11. Equity:
of Command.5.Unity of Direction.6.Subordination of Individual
vertical chain of command. Advantages degree of span of management.
select,train, place,promote and (retire) qualified people.It is a continuous supervisor in a small manufacturing firm might have 20 people reporting to him or her.•Other • The manager should treat the Scalar
Interest to General Interest.7.Remuneration.8.Centralization.9. employees equally and kindly.
Chain.10.Order.11.
Members of a particular team b) Nature of Work: Different types of work require different patterns of
process.5.Directing:When people are are drawn
available from
in the the functional
organization,they departments
must and
know what they Is logical and reflection of functions
important tasks for many middle-level managers include helping the company undertake Equity.12.Stability of tenure• The
of personnel.13.Initiative.14.Esprit
employee’s morale, sincerity de Corps. Max Weber’s
and loyalty will be improved.
are placedtounder theorganization.Superior
direction of a project manager management. For routine and standardized work, larger span can be kept as THEORY1.There is insistence in following standard rules.2.There is a
are expected do in the managers fulfill who has the overall
this requirement by Follows principle of occupation specialization.
profitable new ventures and finding creative ways to reach goals.•Quite often the middle-level BUREAUCRACY • There will not be any friction among the employees
Advantages:
responsibility
communicating of a particular
to subordinates aboutproject.
their expected behavior.Through directing the actual Simplifies training job requires only general instructions
manager conducts research on the Internet to gather ideas for new ventures.FIRST-LEVEL systematic division of work.3.Principle of hierarchy is followed.4.It is necessary for the individual
It attempts
performance of atosubordinate
retain theisbenefits of both
guided towards the structures
company (functional
objectives.Directing & project).
includes,1.Giving Better control as the manager inMANAGERS•Managers
charge of each functional department
who supervise
c) Degree of
operatives are referred to as firstlevel managers, first
Centralization or Decentralization: Degree of centralization
to have or
knowledge of and 12. Stability
training in the of tenure
application of
of personnel:
rules.5.Administrative acts, decisions and
Cross functional
instructions structure allows
to subordinates2.Guiding the for the access
subordinates and
to do thesharing of skilled the
work3.Supervising people is usually a specialist. -line managers, or supervisors.•Historically,first level managers were decentralization
promoted from productionaffects the span of management by affecting the degree
rules of
are recorded • Stable and
in writing.6.There secure
is rational work force
personnel is an asset
administration. NEOto -any organization.
CLASSICAL
and resources
subordinates to make from across
certain thatthe organization.
the work done by them is as per the plans established. Disadvantages involvement
or clerical positions into supervisory positions.Rarely did they have formal education beyond of the superior in decision making. THEORIES • HUMAN •
RELATION It will take
THEORY some
by time
Elton for
Mayo an
OR employee
BEHAVIOURALto work efficiently in his job
MANAGEMENT
Disadvantages:
Directing involves the following functionsa) Leadership b)Communication c)Motivation Reduced coordination between high functions.
school.•A dramatic shift has taken place in recent years,however.Many d) Degreeofoftoday’s Planning: Plans which can provide rules, procedures THEORY
first level in doing(Hawthorne
the even if he has the required
Experiments)–Illumination skill and Assembly
Experiments–Relay knowledge. test room–
Potential forLeadership:It
d)Supervision• conflict between functional
is the quality projectofgroups.
of the behavior a person by which he can inspire Conflicts between different functions
managers could be detrimental
are career for the
school graduates who are familiar with modern work higher would
management be the degree of span of management.
techniques.• Interviewing Programme–Bank • Thewiring
management should create SCIENCE
test room• BEHAVIOURAL favorableTHEORY
workingorconditions by
The current emphasis on productivity and quality has elevated thee)status Geographical distribution: locations where the subordinates are MOTIVATIONAL
placed will THEORY–Maslow’s providingNeed goodHierarchy Theory–McGregor’s
salary, promotion Theory Xwelfare
opportunities, and Theory
facilities
Membersand
confidence may suffer
trust in his confusion
subordinates, when taking orders
get maximum fromfrom
cooperation more than
them andone
guide their organization as a whole. of many supervisors.
The conceptual skill refers to the determine
ability of a the
managerspan toof control.
take Y Maslow’s Need Hierarchy Theory•Maslow stated that people are motivated to achieve
superior.
activities in organized effort.•Communication : Communication is the process by which ideas are Difficult for general managers to coordinate different departments.
Skills required: Conceptual skills: 13. Initiative:
certain needs and that some needs take precedence over others.Our most basic need is for
transmitted, received and understood by others for the purpose of achieving desired results. However, it is much suitable fora large
broad organizations
and farsighted view of the
where there is sation and its future,hisf)ability
organi- Time:toan think executive
in abstract, can hisgive necessary advice and direction only if the person • Initiative is the power of thinking and executing
physical survival, and this will be the first thing that motivates our behavior. Once that level is
any task with
Communication may be verbal or written. • Motivation:Inspiring the subordinates to do a work or ample scope for specialization. ability to analyse the forces working in a situation, his creative andhas the sufficient
innovative ability andtime his to devote for subordinates. enthusiasm voluntary.
fulfilled the next level up is what motivates us, and so on.1.Physiological needs-These are
to achieve company objectives effectively or efficiently.•Supervision:Supervision is necessary in ability to assess the environment
Once the harmony and proper coordination among differentand the changes
function is taking place in it.In short, it is his ability to biological requirements for•human When survival,e.g.air,food,drink,shelter,clothing,warmth,sex,sleep.If
employees come forward with new ideas, new methods
order to ensure,•1.That the work is going on as per the plan established•2.That the workers are conceptualise
achieved, it could lead to sure success for anthe environment, the organisation, and his own job, so that he can set appropriate
organization. etc., they must be encouraged
• It improves good morale among the employees
14. Espirit de corps:
• It is a French word meaning feeling of harmony and union among
personnel of an organization.
• Management should treat the employees kindly and equally to
develop co-operation among them.
• Management should avoid the policy of divide and rule

2. Authority and responsibility:

these needs are not satisfied
Management Functionsthe human body cannot function optimally.Maslow considered • Coordinating: Means achieving harmony
The strength of of
theindividual
contingencyeffort approach is that it encourages managers toFexamine I R S T -individual
LEVELMANAGERS of alternatives 5. Evaluation of alternatives 6. Selecting an alternative 7. Formulating derivative
• Authority is the power given to a person to extract work from his
physiological needs the :most
• Forecasting It isimportant
necessary as all the other needs
preliminary become secondary
to planning. Forecasting until estimates
these towards the accomplishmentand of company objectives.before
situational differences Makedeciding
plans on a course of action.Its major problem • Managers is that who
it is supervise operatives are referred to as first-
plans 8. Establishing sequence of activities TYPES OF PLANS • Based on the frequency of use
subordinates.
– StandingResponsibility
plans • Based onisscope the obligation ofPlanning
a person– Tactical
to perform his
needs are met.2.Safety
what should be needs-Once
done in future. an individual’s physiological
Forecasting beginsneedswithare satisfied,the
sales forecast,needs and is to regulate the activities andoften
communication
used as an excuse of subordinates
for not acquiring onformal knowledge about management. levelTASKS
managers, AND first-line managers, or supervisors. – Single-use plans – Operational
for security and safety become salient.People want to experience order,predictability and control RESPONSIBILITIES OF PROFESSIONAL MANAGERS •A Professional manager is an Planning – duties Planning
Strategic towards–aContingency
job. Planning • Based on time frame – Long-term plans
followed by production forecast and forecasts for costs finance, purchase, the job. Informal relationships within the organization always • Historically, first level managers were promoted from
in their lives.These needs can be fulfilled by the family and society(e.g.police,schools,business invaluable asset to the firm.His primary job is directing employees and coordinating various • Authority may be delegated whereas responsibility
– Intermediate plans – Short-term plans PLANS based on frequency of use• Standing cannot be delegated.
plans –
profit/loss etc. tend to facilitate coordination production or clerical positions into supervisory positions.
and medical care).For ex,emotional security,financial security(e.g.employment,social welfare), activities of the firm.For ofthis,he needs communication,technical,conceptual and human • People–often seek–authority
Strategies but not responsibility.
• Planning : It is the conscious determination of the future course of action to • Controlling : Controlling involves identification actual results, Rarely didskills.–
they have formal education beyond high school. Missions or Purposes Objectives – Policies – Procedures – Rules • Single-use
law and order,freedom from fear,social stability,property,health and wellbeing(e.g.safety against Envisioning Goals_Managing Growth–Improving and Maintaining Efficiency–Innovation– plans – Programs• The– fearBudgets of responsibility
– Schedules – Methodsspoils initiative
– Projects and destroys
STANDING other• Missions
PLANS good qualities.
achieve the desired results. What to achieve ? When to achieve ? How to comparison of actual results with expected results as set by • A dramatic shift has taken place in recent years, however.
accidents and injury).3.Love and belongingness needs-after physiological and safety needshave Looking out for the competition–Leadership–Change Management–Choosing correct (or) Purposes•–Authority
Each organizationwithouthas responsibility and responsibility
a mission or purpose. without
– It is a statement authority are the
that identifies
achieve third
?. Itlevel
includes determination ofandobjectives, settingofrules and procedures, planning process , identification of deviation between the two, if Many of today’s first level managers are career school
been fulfilled,the of human needs is social involves feelings belongingness. Information Technology>Envisioning Goals:The first and most important task of any manager is major
the basic function defects
or tasks oforganization/company/enterprise
of an any organization. or any part of it. – Purpose of
determiningtoprojects, setting policies
need forand strategies, budgeting etc. any and taking of corrective providing
action soa that actual results match graduates who are familiar with modern management housing board is to design, build and distribute the houses to people with nominal price. –
Belongingness,refers a human emotional interpersonal relationships,affiliating, direction to the organization.This entails mapping out their visions and missions. • Management should clearly arrange and distribute the Authority and
• Organizing : it part
is theof aprocess of dividing work in to convenient tasks or with expected results. techniques.
connectedness,and being group.Examples of belongingness needs include friendship, This is one task the manager must not delegate,but perform himself.Defining the company’s Purpose of any Responsibility.
business is the production and distribution of goods and services. – Normally,
3. Discipline:
duties, grouping
intimacy,trust,and of such duties
acceptance,receiving in theaffection,and
and giving form of positions, and grouping
love.4.Esteem needs are of the – 1.Set standards objectives helps unify the employees and gets them working towards a common • Thegoal.
current emphasis on productivity and quality has elevated mission or purpose are often used interchangeably.• Objectives are the basics of every
various
fourth level positions
in Maslow’s hierarchyin toanddepartments and sections and delegating
include self-worth,accomplishment authority to
and respect.Maslow – 2.Measure Job performance>Managing Growth:One of the main roles and responsibilities of the manager theis status
to manage of many
the supervisors. • Discipline is respect of agreements, sincere effort for completing a
company and the desired objective/result that the company plans on achieving, so they are the
classifiedeach
esteemposition
needs so intothat the work is carriedforout
two categories:(i)esteem as planned.
oneself(dignity,achievement,mastery, – 3.Take corrective action growth and ensure the survival of the firm.There are both internal and external•factors SYSTEMS APPROACH
that are a endpoint of every given task activity.
planning and outward marksone
• For example of respect.
of the objectives of an organization could
• Decision Making : It is the process by which a course of action – The systems approach to management is more a be to increase sales • To maintain
• Staffing : Heredesire
independence)and(ii)the the Managers/
for reputationHR department
or respect select, train, place, promote and
from others(e.g.,status,prestige). by 20%. Sodiscipline requires
is consciously chosen from athreat to this growth and survival of the firm. Internal factors(such as choosing the right
available alternatives for the perspective for viewing problems than a school of thought.
the manager will plan all activities of the organization with this
Maslow • Directing:
(retire)
indicatedqualified
When
that people
the need people.
for areIt available
is aorcontinuous
respect in theisorganization,
reputation process.
most important they must and
for children know what technology,hiring the correct people,etc.)are mostly in the firm’s control.External factors end objective in• mind.
GoodWhile supervisors
framing the at all levels. of the organization some points should be
objectives
adolescents andexpected
precedes to realdo self-esteem or dignity.5.Self-actualization needs fulfill
are thethishighest
purpose of achieving desired(government
results. policy,economic conditions,etc.)pose a concern the manager must– It dealis with.
based on the concept that an organization is a system,
kept in mind. – •Objectives
Clear andshould fair agreements
be framed for a single activity in mind. – They should be result
they are in the organization. Superior managers • An out standing quality of a>Improving
successful manager is his ability to
level in Maslow's hierarchy, and refer to theto realization of a person's or an entity of interrelated parts. • Judicial application of actions
penalty– Objectives should not be vague, they
requirement by communicating subordinates aboutpotential,self-fulfillment,
their expected behavior. make sound and logical decisions.
and Maintaining Efficiency:The manager has many roles and responsibilities oriented. The objective must not frame any
seeking personal growth and peak experiences.Maslow (1943) describes this level as the desire – If you adjust one part of the system, other parts willshould
regarding the efficiency of the firm. Firstly he must ensure that the firm is efficient,i.e.resources be be quantitative
• Effective communication
and measurable. – They should not be unrealistic. Objectives must be
Through directing the actual performance of a subordinate is guided towards T O P - L E V E L M A N A G E are
R S not being wasted.And then this efficiency has to be effectively maintained.>Innovation:It 4. Unity of Command:
to accomplish everything that one can, to become the most that one can be.McGregor’s affected automatically.
is achievable.• Strategy : This obviously is the next type of plan, the next step that follows
company objectives. • Most people who enter the thefield of ofmanagement aspire to • For any action, an employee must receive orders and instructions
Theory X and Theory Y• THEORY X–Dislike their work.–Avoid responsibility and need task the manager to be innovative in his job. He must find new and creative – The organization
solutions to transforms inputs into outputs andobjectives. A strategy is a complete and all-inclusive plan for achieving said objectives. A
Directing includes, from
constant direction.–Have to be controlled forced and threatened to deliver work.–Need to be become top-level managers—managers
the problemsat theby
faced toptheone or
firm.Innovation not only means having new ideas but supplies them to the outside world. If these outputs are
also cultivating strategy is a plan that the supervisor
has three specificonly.
dimensions – Establishing long-term objectives –
1. Giving instructions to subordinates two levels in an organization.and implementing them. This is one of the on-going jobs of a professional manager.>Looking • Multiple commands will cause confusions and conflicts.
supervised at every step.–Have no incentive to work or ambition, and therefore need to be perceived as valuable, the organization will survive and Selecting a specific course of action – allocating the necessary resources needed for the plan •
enticed2.Guiding
by rewards theto subordinates
achieve goals•THEORY to do theY–Happy work to work on their own initiative.–More • Top-level managers are empowered
out for the to make major
competition:A decisions
manager has to plan and prepare for the competition prosper.in the market.He Forming strategy • Sound
is generally management
reserved forshould
the top avoid
level ofdual commands.
management. It actually defines all
3.Supervising
involved the subordinates totomake
in decision making.–Self-motivated certain
complete their that the work
tasks.–Enjoy done
taking by themofis as
ownership affecting the present and future
must of thebe
never firm.
caught unaware, he must prepare for new and/or increased competition. future decisions5.and Unity of direction:
the company’s long-term scope and general direction.•Policies are generic
– The feedback loop indicates that acceptance of the outputs
per the plans
their work.–Seek and established.
accept responsibility,and need little direction._ View work as fulfilling and • Only a top-level manager, for example, would
>Leadership:The have
quality theleadership usually dictates the future of a firm.Hence
of the the gives the organization new inputs for statements, which • There shouldabe
are basically onetohead
guide and one
channelize plan towards
energies for eacha group of strategy.
particular activitiesIt is
by society
Directing involves
challenging.–Solve problems thecreatively
following andfunctions,
imaginatively. MODERN MANAGEMENT authority to purchase another company,
manager mustinitiate
also be aagoodnew leader.He
product should be able to inspire and motivaterevitalization
people to workand expansion. an organization’s having
generalthe way same objectives. interpreting and implementing strategies. Like
of understanding,
a) Leadership
THEORIES • QUANTITATIVE APPROACH–Provides managers with a scientific basis for towards the goals of the company. A leader leads from the front, and the manager must also
line, or hire hundreds of employees. for example, most • All the
companies groupshavework together
a return policy or to achieve
recruitment the common
policy or pricing goal.
policy etc. •
14 principles of management
solvingb)problems
Communication
and making decisions.-It uses a wide array of mathematical and statistical • Top-level managers are thepossess
people exceptional
who give the qualities and work ethic that his team members can learn from.>Change
organization Policies are made • Unity
acrossofallcommand cannot function
levels of management, from majorwithout unity
policies of top-most
at the direction. level to
1. Division of work: This principle leads to specialization in any field 6. Subordination ofform
individual interest
c) Motivation
techniques.–The primary strength of management science is that it enables managers to solve Management:In any company or organization, change is a given. The manager has to be the minor policies. The managers need to policies to help theto general interest:
employees navigate a situation
its general direction; they decide where it is going and how it of activity. If a worker concentrates his efforts on a particular task,
d) Supervision
problems that are so complex they cannot be solved by common sense alone.–A weakness of agent of change in such cases. It is his roles and responsibilities to ensure the process of with predetermined • Andecisions.
employee’s Theyinterest
also help is to earn money
employees to maketo meet his
decisions personal needs where
in unexpected
• Leadership : It is will get there.
management science is that thethe quality
answers of the behavior
it produces are often lessof aprecise
personthan by which he can
they appear. • change is smooth and uneventful for the company.>Choosing correct Information he will becomeTechnology: more skilled in that activity. It increases situations.• Procedures organization interest
are the next types is
of to maximize
plan. They are the production
a stepwise guide forandthedevelop the
routine to
SYSTEMSinspire confidence and trust in histosubordinates,
management isget maximum cooperation • The terms executive and top-level manager can be used
This is a problem that all managers of today’s era are facing. There are productivity, quantity and quality of output. It got some carry out the activities.
APPROACH –The systems approach more a perspective for so many choices business. These The interest
stepwise of organization
sequences is morebyimportant
are to be followed than the
all the employees so interest of
from them
viewing problems than and
a schoolguide their activities
of thought.–It is based inonorganized
the concept effort.
that an organization is a
interchangeably.
M I D D L E - L E V E L M A N available
A G E R Sin the market for various IT processes. disadvantages. the activities canan be employee.
fulfilled in an organized manner. • The procedures are described in a
system, or• an Communication
entity of interrelated : Communication
parts.–If you adjust is the
oneprocess
part of thebysystem,other
which ideasparts arewill be • Middle-level managers are MODmanagers who are• Most
2:PLANNING neither basic executives nor
of all management 1. Worker
functions.•It is the process suffers boredom because of repetition of the samechronological
of selecting type 7. Remuneration
order. So when the employees of personnel:
follow the instructions in the order completely, the
transmitted, received
affected automatically.–The and understood
organization transforms inputs by others for the
into outputs andpurpose of achieving
supplies them to the first-level supervisors, but who serve as
objectives andadetermining
link between the two
the course action required to achieve theseofobjectives.
of groups. work. NEED • Remuneration
success of the activity is pretty much isguaranteed.
the money• paid Take forto the
exampleemployees for their
the procedure of
desired
outside world.If theseresults.
outputsCommunication
are perceived as may be verbal
valuable,the or written.
organization will survive and • Middle-level managers conduct most of theorcoordination
FOR PLANNING PURPOSE OFactivities PLANNING within 2. Difficult
• The increasing time spans betweentopresentreschedule if any worker is absent. physical
admission of a student in aand mental
college. efforts instarts
The procedure carrying out aout
with filling work.
an application form. It
prosper.–The • Motivation
feedback loop : Inspiring
indicatesthe thatsubordinates
acceptance of the to do a work
outputs or to achieve
by society gives thecompany the firm, and they disseminate decisions and future
information to results.
upper and • Increasing organization complexity • Increased
lower levels. 9. Scalar
externalChain:
change • will be followed by • Ita collection
should beof fair and satisfy
documents both the
and sorting theapplications
employeesaccordingly.•
and employers. Rules are
8. Centralization:
organization objectives
new inputs effectively or efficiently.
for revitalization and expansion.•CONTINGENCY APPROACH–Also Planning vary
• The jobs of middle-level managers and other management
substantially terms of IMPORTANCE OF PLANNING•or
in functions. Scalar chain means line of authority
OBJECTIVES very specific statements that define an action or non-action. Also, rules allow for no flexibility at
known as •SITUATIONAL
Supervision APPROACH
: Supervision TOisMANAGMEMENT.–The
necessary in order tocontingency ensure, approach to • Instructions and orders should be sent from top level toall,the • Ifemployees
most of the power and responsibilities arefollow
retained at top level
responsibility and income. A OF PLANNING
branch manager • Planning
in a largeprovides
firmdirection.
might be • Planning reduces risks of uncertainty. • Planning they are final. All of the organization must compulsorily and implement the
management • 1. That the work is going onone
emphasizes that there is no as best
per way
the to
plan manage people or work.–A method
established reduced uncertainty and wasteful activities. • Planning promotes innovative bottom level only through the line of authority.
ideas. • Planning rules. Not following management,
rules can havethe organization
severe consequences. is centralized.
• Rules create an environment of
responsible for over 100 workers. In contrast, a general supervisor in a
that leads•to2.high
That productivity
the workers or morale in oneas
are doing situation may not
they were achieve the same results in
directed facilitates decision making. • Planning established standards for controlling.• •There should• be an unbroken line of power and command
Economical. discipline • All the decisions
from in the organization. They guide arethetaken
actions only
andby thethe top executive
behaviour of all the at the centre.
employees of
small manufacturing firm might have 20 people reporting to him or her.
another.–Common sense also contributes heavily to the contingency approach.–Experienced Utilization of resources. • Effectiveness. • Coordination.STEPS IN PLANNING top1.level
Identification
to bottom of level. the organization. The • If the
rule ofpower is delegated
“no smoking” is one to suchtheexample
subordinates,
SINGLE USE the PLANS
organization
•Programsis
• Other important tasks for many middle-level managers include helping the
managers know that not all people and situations respond identically to identical situations.– Opportunities 2. Establishment of Objectives 3. Developing planning premises 4. Identification
• Overlapping decentralized.
are an in-depth statement
any one in the organization structure will spoil Management
that outlines a company’sispolicies,
effective forobjectives,
rules, a decentralized
procedures form.
etc.
company undertake profitable new ventures and finding creative ways to
the performance of the management system. • Delegation of authority to subordinates helps to take quick decision on all
reach goals.
important problems.
• Quite often the middle-level manager conducts research on the Internet to
gather ideas for new ventures.
These programmes are important in the implementation of all types of plan.They create a link time periods up to one year.•These plans take care of individual activities needed to achieve the company. In an organic structure, the business is made up of a network of people or teams who
between the company’s objectives, procedures and rules. • Primary programmes are made at overall objectives outlined by longterm planning. • They guide manager by stating what he has work together in varying capacities to achieve the goals of the business.• Functional structure
the top level of management. To support the primary program all managers will make other to do, how, where and when he has to do, and resources available for performing the specified – A functional organizational structure groups employees together based on their functions or
programs at the middle and lower levels of management.•Budget is a statement of expected task. • Short term plans helps managers make better use of manpower and other resources in roles and areas of specialization. Typical departments are marketing, human resources, finance,
results the managers expect from the company. Budgets are also a quantitative statement, so the immediate future.ORGANIZING•Organizing means identifying and grouping of activities engineering, sales and customer service. – Departments in a functional structure are often
they are expressed in numerical terms. A budget quantifies the forecast or future of the required to attain the objectives, defining and delegating authority, creating responsibility and called "silos" because they work independently from each other. The employees communicate
organization. • There are many types of budgets that managers make. There is the obvious establishing relationship for the people to work effectively. • It is a mechanism or structure which exclusively with others in their group and report to a department head. Department heads
financial budget, that forecasts the profit of the company. Then there are operational budgets helps the activities to be performed effectively. • Organization is established for the purpose of communicate with their peers in other departments. Managers of departments report directly to
generally prepared by lower-level managers. Cash budgets monitor the cash inflows and achieving the business objectives.STEPS INVOLVED IN ORGANIZING1.Establishment of top management or the CEO. – This type of organizational structure works best in a stable
outflows of the company.•Methods prescribe the ways in which specific tasks of a procedure objectives. 2. Departmentation. 3. Defining authority and responsibility. 4. Delegation of environment with few changes where job tasks are standardized and continuous.•Divisional
must be performed. Also, methods are very specific and detailed instructions on how the authority. 5. Establishment of structural relationship.PRINCIPLES OF ORGANIZING•Principle of structure – An organization which is very large in size and is producing more than one product,
employees must perform every task of the planned procedure. So managers form methods to objective. • Principle of efficiency. • Principle of span of control. • Principle of unity of command. they need to evolve a design to cope with the complexity. – The activities related to one product
formalize routine jobs. • Methods are very important types of plan for an organization. They help • Principle of unity of direction. • Principle of scalar chain. • Principle of division of work. • are grouped under one division. – This organizational structure consists of separate divisions,
in the following ways – give clear instructions to the employees, removes any confusion – Principle of authority and responsibility. • Principle of flexibility and continuity. • Principle of each such division has its own manager. Within each division, functions like production,
Ensures uniformity in the actions of the employees – Standardizes the routine jobs – Acts as an stability.ORGANIZATION STRUCTURES • It is the formal pattern of interactions and marketing, finance etc. are performed. – In other words, each division tends to adopt a
overall guide for the employees and the managers• Schedules specifies time limits within which coordination designed by management to link the tasks of individuals and groups in achieving functional structure. However, functions may vary across divisions in accordance to their
activities are to be completed.•It is the process of establishing a time sequence for the work to the organizational goals. • Organization structure should be designed to clarify who is to do, product line.• Matrix structure – Matrix structure most often refers to a group project within a
be done. • It is essential for avoiding delays and for ensuring continuity of operations.•Projects is what task and who is responsible for what results. • Organization structure consists simply of large company that uses workers from a variety of departments without actually transferring
similar to program but is smaller in scale and less complex. • It may be a component of a those aspects of pattern of behaviour in the organization that are relatively stable and change those workers. Each worker then moves between his / her day-to-day work and the special
program, or it may be self-contained, single-use plan. • Project helps in the precise allocation of only slowly.•Types of Organization structures–Based on power flow within organization 1. project. – For example:- Say a company launches a new project that requires workers from
duties and effective control and easy implementation of your planPLANS based on Scope1. Bureaucratic or mechanistic structure. 2. Organic or adaptive structure. – Based on the several departments, including research and design, legal and graphic design. However, the
Operational Planning2.Tactical Planning3.Strategic Planning4.Contingency Planning• formation of departments/groups 1. Functional structure. 2. Divisional structure. 3. Matrix company does not want those participating in the project to ignore the responsibilities of the
Operational Planning is the planning that a manager uses to accomplish his or her job structure. 4. Team structure. 5. Network structure.• Bureaucratic or Mechanistic structure – home department. Each worker is then said to move horizontally between the project and home
responsibilities. • These plans are stated in specific, quantitative terms and serve as the This type of organizational structure derives from the bureaucratic management theory, which department, as neither duty should take precedence over the other. Project members will report
department manager’s guide to day to day operations. • Developed by Low level managers. • was first used and described by German sociologist Max Weber. He believed that this was the to the project leader and the home department head. The project leader's ability to manage
Time frame is less than an year. • Clearly depicts what must be accomplished over short time most efficient way to run an organization. – The bureaucratic organizational business model is members from different departments also gives him a horizontal role. Department heads remain
periods in order to achieve operational goals. • All information can be attained completely from characterized by standardized processes and strict rules. – Each employee has a clearly the direct boss of only those in lower positions within their department, which is why this position
within the organization.•Tactical Planning aims at achieving tactical or short term goals. • Tactics defined role and responsibilities. – Employees are hired based on their ability to perform the is said to function vertically.• Team structure – Organizations are typically comprised of a
are the means needed to activate a strategy and make it work. • Concerned with what the lower tasks assigned to them, and personality has little to do with their success. – In a bureaucratic variety of teams that help accomplish company goals and meet projections. – While individuals
level units within each division must do, how they must do it and who is in charge at each level. organization, the recruiting process is formal and involves job-specific tests. – Promotions are cycle through times of higher and lower productivity, teams hold the potential of offering a more
• These plans usually span one year or less. • Developed by Middle level managers in merit-based, not dependant on seniority. – Employees are highly specialized, which is why this steady level of achievement within the organization as a whole. – Depending on company
consultation with Low level managers.•Strategic Planning begins with organization’s mission. • type of company may have hundreds of job titles.•Organic or adaptive structure–An organic structure, there could be permanent teams, temporary teams, committees, workforce teams,
These look over to next 2,3,4 or even more years from where it is currently is to where it wants organizational structure is a flat organization that allows for horizontal communications and crossfunctional teams, self-managed teams, task forces and/or virtual teams. – Each type of
to be. • These plans demand harmony among all levels of management within the organization. interactions and is more suited to creative businesses. This type of organizational structure is team has a different team structure and function designed to achieve a certain end. – The intent
•Contingency Planning is devised for a specific situation when things could go wrong. • During decentralized, giving employees at all levels a chance to participate in business-related decision is to breakdown barriers among departments and create a more effective relationship for solving
times of crisis, these plans are often developed to explore and prepare for any eventuality. • making. – Businesses with an organic structure often encourage group participation and the ongoing problems.• Network structure – Network structure relies on other organizations to
This planning involves identifying alternative courses of actions that can be implemented if and sharing of work responsibilities. Communication channels are open to employees, managers perform critical functions on a contractual basis . – For example:- A core company may give
when the original plan proves inadequate because of changing circumstances.PLANS based and business owners and contact between all levels of employees usually occurs on a regular contract to specialized company for development of software & website on their behalf.
on Time frame 1. Long-term plans 2. Intermediate plans 3. Short term plan•Long term plans are basis. Lower-level employees tend to have more face-time with executives than in a Similarly, the design work, accounts and tax calculation, marketing, etcLEADERSHIP •
plans which have a time frame exceeding 5 years. • It is derived from the vision developed for mechanistic organization. The type of communication most often used in organic structures is Leadership is the process of influencing the behaviour of others towards the accomplishment of
the organization by its founders or top managers. • It involves setting up broad objectives and verbal. – The flat nature of organic businesses allows this type of organizational structure to be goals in a given situation. • It is the art of process of influencing people so that they will strive
establishing procedures for achieving these objectives•Intermediate plans generally covers time more flexible to change if needed. Employees take part in a joint specialization based on the willingly towards the achievement of group goals. • It is an important factor for making any type
periods ranging from 1 to 5 years. • These plans specify the activities to be carried out. • Define jobs at hand, providing expertise on a wide array of functions within the business. Status is tied of organizational successful. • IMPORTANCE OF LEADERSHIP – Motivating Employees –
the organizations activities and provide direction for middle management•Short term plans cover to the perceived intelligence and aptitude of the employee rather than their position within the Develops team work – Better utilization of man power – Creating confidence to followers –

Directing group initiatives – Building morale – Maintaining discipline LEADERSHIP QUALITIES ALTERNATIVES•Point of ultimate decision making. • Quantitative and Qualitative factors. • representation is characterized by a tree-like structure in which the problems in decision making
• Honesty • Confidence • Patience • Focus • Dedication • Consistency • Motivate others • Techniques for evaluation of alternatives – Marginal Analysis – Cost Benefit Analysis (CBA) = can be seen in the form of a flowchart, each with branches for alternative choices. • A Decision
Effective communication • Multiplicity of roles • Individuality • Personal dignity LEADERSHIP Benefit/CostSELECTING FROM ALTERNATIVES •Experience •Experimentation •Research and Tree Analysis is created by answering a number of questions that are continued after each
BEHAVIOUR AND STYLES • Autocratic or Dictatorial Leadership • Participative or Democratic Analysis TYPES OF DECISIONS>PROGRAMMED DECISIONS • These decisions are affirmative or negative answer until a final choice can be made.• This Analysis is commonly
Leadership • Laissez-faire or Free rein LeadershipMANAGERS V/S LEADERS Managers • recurring in nature. • Problems are structured. • Decisions are simple and have a small impact. • represented by lines, squares and circles. – The squares represent decisions – The lines
Managers develop policies and procedures. • Managers direct and control. • Managers get Decisions are guided by organizational policies, procedures, etc. • Decisions are taken by lower represent consequences – The circles represent uncertain outcomes. – By keeping the lines as
people to do what needs to be done. • Managers explain “what we have to do.” • Managers are management. NON PROGRAMMED DECISIONS • These decisions are non recurring. • far apart as possible, there will be plenty of space to add new considerations and ideas. • The
concerned with the here and now. • Managers are task oriented • Managers are concerned with Problems are unstructured. • Decisions are relatively complex and have a long term impact. • representation of the decision tree can be created in four steps: 1. Describe the decision that
projects. • Management is doing things right. Leaders • Leaders develop vision and strategy. • Decisions are guided by the factors of particular situation. • Decisions are taken by top level needs to be made in the square. 2. Draw various lines from the square and write possible
Leaders motivate and inspire. • Leaders get people who want to do what needs to be done. • management.TECHNIQUES FOR NON PROGRAMMED DECISIONS• Delphi Method • solutions on each of the lines. 3. Put the outcome of the solution at the end of the line. Uncertain
Leaders explain “where we are going”. • Leaders are concerned with he long view. • Leaders are Nominal Group Technique • Experience • Quantitative Decision making tools • Quality Circles or unclear decisions are put in a circle. When a solution leads to a new decision, the latter can
vision oriented. • Leaders are concerned with people. • Leadership is doing the right things. 8 DECISION MAKING ENVIRONMENT • Decision making under RISK. • Decision making under be put in a new square. 4. Each of the squares and circles are reviewed critically so that a final
DIMENSIONS OF LEADERSHIP Leadership Dimensions Pioneering Leader Energizing Leader CERTAINITY. • Decision making under UNCERTAINITY.RISK•Risk refers to a decision making choice can be made. PRODUCTIVITY & COMPETITIVENESS PRODUCTIVITY • Productivity is
Affirming Leader Inclusive Leader Humble Leader Deliberate Leader Resolute Leader situation where there are different possible outcomes and the probabilities of these outcomes defined as an index that measures output (goods and services) relative to the input (labor,
Commanding Leader can be measured in some way.•It involves choices with multiple outcomes where the probability materials, energy, etc. used to produce output). • It is the measure of how specified resources
MOD3:DECISION MAKING•It is defined as the selection of a course of action from among of each outcome is known or can be estimated. • Every business involves risks and most people are managed to accomplish timely objectives as stated in terms of quantity and quality.
alternatives. • A plan cannot be said to exist unless a decision has been made. • People must do not like being involved in any risky enterprise.DECISION MAKING ENVIRONMENT • Productivity = Output / Input • Increase in production may or may not be an indicator of increase
have a clear understanding of alternative courses by which a goal can be reached under Decision-making under Certainty:A condition of certainty exists when the decision-maker in productivity. • Objective of productivity measurement – Study the performance of the system.
existing circumstances and limitations. • They must find a best solution by selecting the knows with reasonable certainty what the alternatives are, what conditions are associated with – Compare with different systems. – Compare actual productivity with desired productivity.
alternative that most effectively satisfies goal achievement.DECISION MAKING each alternative, and the outcome of each alternative. – Under conditions of certainty, accurate, BENEFITS OF PRODUCTIVITY MEASUREMENT • Higher profit • Employee’s welfare • Better
PROCESS1.Defining the problem. 2. Analyzing the problem. 3. Developing alternative solutions measurable, and reliable information on which to base decisions is available. – The cause and return • Nice relations • Customer satisfaction • Good credit rating • Goodwill • Low labour
(Principle of limiting factor). 4. Deciding upon the best solution. 5. Implementing the decision. 6. effect relationships are known and the future is highly predictable under conditions of certainty. – turnover.FACTORS AFFECTING PRODUCTIVITY>Controllable Factors•Production factors•
Follow up. FACTORS AFFECTING DECISION MAKING•Decision situation.•Decision Such conditions exist in case of routine and repetitive decisions concerning the day-to-day Organizational factorsFinance factors•Technological factors•Personnel factors•Managerial
makers.•Time.• Decision support techniques.•People affected by the decision.•Decision criteria. operations of the business. – Eg :- LINEAR PROGRAMMING (LP)•Decision-making under factors>Uncontrollable Factors•Natural resources•Government and Infrastructure
CHARACTERISTICS OF DECISION MAKING•Decision making implies choice.•Continuous Risk:When a manager lacks perfect information or whenever an information asymmetry exists, MEASUREMENT OF PRODUCTIVITY•SINGLE FACTOR PRODUCTIVITY•When consumption
activity/process. • Inbuilt uncertainty and risk. • Goal oriented process. • Time consuming risk arises. – Under a state of risk, the decision maker has incomplete information about of only one resource is taken to calculate the productivity, it is called single factor productivity or
activity.IMPORTANCE OF DECISION MAKING•Better utilization of resources. • Facing available alternatives but has a good idea of the probability of outcomes for each alternative. – partial productivity. • Comparison of output with all the input factors ( like labour, material,
problems and challenges. • Achieving objectives. • Increases efficiency. • Facilitate innovation. • While making decisions under a state of risk, managers must determine the probability machinery, etc.) taken together is called total productivity index and comparison of output with
Motivates employees.LIMITATIONS OF DECISION MAKING•Time consuming. • Compromised associated with each alternative on the basis of the available information and his experience. – anyone of the input factors keeping other factors constant is called partial productivity index.
decision. • Biased decisions. • Limited analysis. • Uncontrollable environmental factors. • Eg :- 1. EXPECTED MONETARY VALUE (EMV) 2. EXPECTED OPPORTUNITY LOSS (EOL) Single factor productivity = Total output / Individual input • Following types are present – Capital
Uncertain future.MODELS OF DECISION MAKING•Decision making models are tools used to 3. DECISION TREE ANALYSIS•Decision-making under Uncertainty:Conditions of uncertainty productivity – Labour productivity – Material productivity.MULTI FACTOR PRODUCTIVITY•This
make effective decisions.•Models suggest different approaches to decision making, depending exist when the future environment is unpredictable and everything is in a state of flux. – The type utilizes more than a single factor. • It is the ratio of total output to a subset of inputs. • Multi
on the context and nature of decision that needs to be made. RATIONAL DECISION MODEL decision-maker is not aware of all available alternatives, the risks associated with each, and the factor productivity measures reflect the joint effects of many factors including new technologies,
(Classical Model) • This model follow logical steps to find a solution to a problem. • Steps consequences of each alternative or their probabilities. – The manager does not possess economics of sale, managerial skill and changes in the organization of production.TOTAL
followed in rational decision making model are: – Define the goal or obstacle. – Determine the complete information about the alternatives and whatever information is available, may not be PRODUCTIVITY•It is the ratio of total output to the sum of all input factors. Total productivity =
relevant information. – Create list of options. – Arrange options by their values. – Choose the completely reliable. – In the face of such uncertainty, managers need to make certain Total output / Total input • Total productivity index gives the absolute measurement between the
best option.INTUITIVE DECISION MODEL•In this model, feelings and instincts are used to assumptions about the situation in order to provide a reasonable framework for decisionmaking. output and the input.TOTAL FACTOR PRODUCTIVITY•It is defined as the ratio of net output o
make decisions. • This is less structured because of lack of time and may use previous – They have to depend upon their judgment and experience for making decisions. – Eg :- 1. the sum of associated labour and capital (factor) inputs. TFP = Net output / (Labour + Capital)
knowledge of similar goals or obstacles to determine a useful solution. • Steps followed are: – MAXI-MAX CRITERION (OPTIMISTIC APPROACH) 2. MAXI-MIN CRITERION (PESSIMISTIC inputs • Here, Net output = Total output–Intermediate goods or services purchased.PROBLEMS
Define the goal or obstacle. – Identify similar goals or obstacles. – Determine a usable solution. APPROACH) 3. MINI-MAX CRITERION (COST ANALYSIS) 4. LAPLACE CRITERION (EQUAL IN MEASURING PRODUCTIVITY•Difficulty in measuring inputs • Difficulty in measuring outputs
RECOGNITION-PRIMED MODEL•Similar to intuitive model except that this model is little more PROBABALITY APPROACH) 5. MINIMAX REGRET (SAVAGE PRINCIPLE)DECISION TREE • Factorial productivity • Changing conditions • Service sector • Different periods • Difficulty in
structured.•Steps followed are: – Define the goal or obstacle. – Consider relevant information ANALYSIS•A decision tree is the graphical depiction of all the possibilities or outcomes to solve measuring man-hours • Technological change COMPETITIVENESS•It is the ability and
and similar situations. – Create a potential solution. – Consider if the solution works. – If a specific issue or avail a potential opportunity. It is a useful financial tool which visually performance of a firm to sell and supply goods and services in a given market, in relation to the
needed, change the solution. – Finalize your decision and take actionEVALUATION OF facilitates the classification of all the probable results in a given situation. • This graphic ability and performance of other firms. • Competitive advantage is the leverage a business has
over its competitors. – Cost / Price – Quality – Product / Service differentiation – Flexibility / necessary for the completion of the project is reduced substantially. 2. Scheduling The ultimate the transformation of an idea, needs, or requirements by consumers or the market place into a
Service objective of the scheduling phase is to prepare a time chart showing the start and finish times product that satisfies these needs. • Process design : Process planning is defined as the
MOD 4:There are three kinds of floats:Total float – The amount of time by which the completion for each activity as well as its relationship to other activities of the project. Moreover the systematic determination of the methods by which a product is to be manufactured economically
of an activity could be delayed beyond the earliest expected completion time without affecting schedule must pinpoint the critical path activities which require special attention if the project is and competitively. It consists of devising, selecting and specifying processes, machine tools and
the overall project duration time. Mathematically (Tf)ij = (Latest start – Earliest start) for activity ( to be completed in time. For non-critical activities, the schedule must show the amount of slack other equipment to convert raw material into finished and assembled products. •Production and
i – j) (Tf)ij = (Ls)ij - (Es)ij or (Tf)ij = (Lj - Dij) - Ei Free float – The time by which the completion or float times which can be used advantageously when such activities are delayed or when planning control : Routing is the selection of path where each part of the product will follow,
of an activity can be delayed beyond the earliest finish time without affecting the earliest start of limited resources are to be utilized effectively. 3. Allocation of resources Allocation of which being transformed from raw material to finished products. Scheduling is the fixation of
a subsequent activity. Mathematically (Ff)ij = (Earliest time for event j – Earliest time for event i) resources is performed to achieve the desired objective. A resource is a physical variable such time and date for each operation as well as it determines the sequence of operations to be
– Activity time for ( i, j) (Ff)ij = (Ej - Ei) - Dij Independent float – The amount of time by which as labour, finance, equipment and space which will impose a limitation on time for the project. followed. • Quality control : Quality is defined as fitness for purpose. Controlling in an
the start of an activity can be delayed without effecting the earliest start time of any immediately When resources are limited and conflicting, demands are made for the same type of resources organization is he process of setting standards, measuring actual performance and taking
following activities, assuming that the preceding activity has finished at its latest finish time. a systematic method for allocation of resources become essential. Resource allocation usually corrective action. Quality control is the means by which actual quality performance is observed
Mathematically (If)ij = (Ej - Li) - Dij The negative independent float is always taken as zero. incurs a compromise and the choice of this compromise depends on the judgment of managers. and then compared it with standard quality performance and then taking action if the observed
Event slack - It is defined as the difference between the latest event and earliest event times. 4. Controlling The final phase in project management is controlling. Critical path methods quality performance is different from the standard quality performance. • Materials management
Mathematically Head event slack = Lj – Ej, Tail event slack = Li - Ei.Critical event – The events facilitate the application of the principle of management by expectation to identify areas that are : Aspect of management function which is concerned with acquisition, control and use of
with zero slack times are called critical events. In other words the event i is said to be critical if critical to the completion of the project. By having progress reports from time to time and materials needed and flow of goods and services connected with the production process.•
Ei = Li Critical activity – The activities with zero total float are known as critical activities. In updating the network continuously, a better financial as well as technical control over the project Maintenance management : maintenance is a set of organized activities that are carried out in
other words an activity is said to be critical if a delay in its start will cause a further delay in the is exercised. Arrow diagrams and time charts are used for making periodic progress reports. If order to keep an item in its best operational condition with minimum cost acquired. Activities of
completion date of the entire project. Critical path – The sequence of critical activities in a required, a new course of action is determined for the remaining portion of the project. maintenance function could be either repair or replacement activities, which are necessary for
network is called critical path. The critical path is the longest path in the network from the MOD 5: OPERATIONS MANAGEMENT • A manufacturing organization engages in converting an item to reach its acceptable productivity condition and these activities, should be carried out
starting event to ending event and defines the minimum time required to complete the project. a variety of inputs into products that are useful for individuals and organizations. • A service with a minimum possible cost. Marketing ■ Marketing is an organizational function and set
CPM (Critical Path Method) was the discovery of M.R.Walker of E.I.Du Pont de Nemours & organization responds to the requirements of customers and satisfies their needs through a processes for creating,communicating and delivering value to customer and for managing
Co. and J.E.Kelly of Remington Rand, circa 1957. The computation was designed for the service delivery process. • An operations system is defined as one in which several activities are customer relationships in way that benefit the organization and its stakeholders Marketing
UNIVAC-I computer. The first test was made in 1958, when CPM was applied to the performed to transform a set of inputs into a useful output using a transformation management ■ The art and science of choosing target markets and getting,keeping and
construction of a new chemical plant. In March 1959, the method was applied to maintenance process.Elements of Operations System • Open system interacts with its environment. • growing customers through creating,delivery and communicating superior customer value ■
shut-down at the Du Pont works in Louisville, Kentucky. Unproductive time was reduced from Closed system do not interact with its environment. OPERATIONS MANAGEMENT • Marketing management is the process of planning and executing the
125 to 93 hours. PERT (Project Evaluation and Review Technique) was devised in 1958 for Operations management refers to the activities, decisions and responsibilities of managing the conception,pricing,promotion,and distribution of ideas,goods,and services to create exchange
the POLARIS missile program by the Program Evaluation Branch of the Special Projects office resources which are dedicated to the production and delivery of products and services. • that satisfy indivitual and organizational goals (philip kotler) Marketing management task ■
of the U.S.Navy, helped by the Lockheed Missile Systems division and the Consultant firm of Operations Managers are hose who are responsible for overseeing and managing the Developing marketing strategies and plan ■ Capturing marketing insights ■ Connecting with
Booz-Allen & Hamilton. The calculations were so arranged so that they could be carried out on resources that make up the operations function OBJECTIVES OF OPERATIONS customers ■ Building strong brands ■ Shaping the market offering ■ Delivering value ■
the IBM Naval Ordinance Research Computer (NORC) at Dahlgren, Virginia.Benefits of MANAGEMENT 1. Customer Service 2. Resource utilization SCOPE OF OPERATIONS Communicating value ■ Creating long term growth Market segmentation- is the act of dividing
PERT/CPM >Useful at many stages of project management>Mathematically simple>Give MANAGEMENT • Plant Location: Plant location refers to the choice of region and the selection a market into smaller group of buyers with distinct needs,Characteristics or behaviors who might
critical path and slack time>Provide project documentation>Useful in monitoring costs of a particular site for setting up a business or factory. But the choice is made only after require separate production or marketing mixes ■ Geographical segmentation- nations,
Limitations of PERT/CPM>Clearly defined, independent and stable activities>Specified considering cost and benefits of different alternative sites. It is a strategic decision that cannot states,country etc■ Demographic segmentation- age, education,income,family ,occupation ■
precedence relationships>Over emphasis on critical paths.Applications of CPM / PERT>These be changed once taken. If at all changed only at considerable loss, the location should be Behavioral segmentation ■ Psychographic segmentation-value and beliefs,lifestyle,hobbies
methods have been applied to a wide variety of problems in industries and have found selected as per its own requirements and circumstances. Each individual plant is a case in itself. ForcastingCan be difined as an estimate of future events,that can be obtained bysystematically
acceptance even in government organizations. These include Construction of a dam or a canal Businessman should try to make an attempt for optimum or ideal location. • Plant layout : It may combining past and present data in a predetermined way and arrive at the future data Sources
system in a region>Construction of a building or highway>Maintenance or overhaul of airplanes be defined as a technique of locating machines, processes and plant services within the factory of forcasting data 1. Primary data 2. Secondary data Sales forcasting- sales forcasting is the
or oil refinery>Space flight>Cost control of a project using PERT / COST>Designing a prototype so as to achieve the right quantity and quality of output at the lowest possible cost of method of accurate determination of the demands of sales Purpose of sales forcasting ■
of a machine>Development of supersonic planes.Basic Steps in PERT / CPM Project manufacturing. It involves a judicious arrangement of production facilities so that workflow is Determines the volume of production and production rate ■ It forms the basis for production
scheduling by PERT / CPM consists of four main steps 1. Planning The planning phase is direct.• Material handling : It is the movement, protection, storage and control of materials and budget,labour budget,meterial budget etc ■ It suggest the need For plant expansion ■ It suggest
started by splitting the total project in to small projects. These smaller projects in turn are products throughout their lifespan of manufacturing, warehousing, distribution, consumption, the needs for production method Limitations ■ Lack of efficient and experianced forecasters ■
divided into activities and are analyzed by the department or section. The relationship of each and disposal. Material handling encompasses a range of components to keep the supply chain Lack of demand history ■ Change in consumer ‘needs ,fashion, style etc ■ Complex psychology
activity with respect to other activities are defined and established and the corresponding running. This includes a variety of equipment types (manual, semi-automated, and automated) of consumer Essentials of good sale forecasting sysytem ■ Simplicity ■ Accuracy ■
responsibilities and the authority are also stated. Thus the possibility of overlooking any task and systems (single-level storage, multi-level storage, conveyors, etc.). • Product design : It is Availability ■ Stability ■ Economy Demand forcasting methods Qualitative method ■ Jury of

executive opinion ■ The delphi technique ■ Sales force opinion ■ Survey of customers buying of capital, which is required to keep the flow of production smooth and continuous. Working 12. Information seeking. 13. Efficiency orientation. 14. Concern for employee welfare.
Quanditative method ■ Moving average method ■ Regression analysis Differents between capital, being lifeblood for enterprise, its management becomes a crucial exercise. The need of 15.Persistence. 16. Self confidence. WAGE EMPLOYMENT ENTREPRENEURSHIP *Work for
qualitative and quantitative Qualitative ■ This method is used when situation is vague and working capital arises due to the time gap between production and realization of cash from others. *Own boss. *Follow instructions. *Make own plans. *Routine job. *Creative activity.
little data available ■ Methods are used for new production ■ Mathematical techniques are not sales. difference between working and fixed capital is that working capital is more liquid. *Earning is fixed. *Earning is flexible. *Does not create wealth. *Creates wealth, contribute to
used in qualitative methods Quantitative ■ This method is used in stable situation where Working capital is needed for the following purposes. 1.Adequate working capital is required to GDP. *Government service Public sector Private sector. *Industry Trade Service enterprise.
historical data is available ■ Quantitative methods are used existing products ■ Quantitative continue uninterrupted business operations. 2. For the purchase of raw materials, components CHARECTERISTICS OF ENTREPRENEURSHIP ECONOMIC ACTIVITY INNOVATION RISK
methods involve mathematical techniques.FINANCIAL MANAGEMENT Financial management and spaces, 3. To pay wages and salaries. 4. To incur day to day expenses and overhead costs PROFIT TEAMWORK ENTREPRENEURAL PROCESS IDEA GENERATION DEVELOPING
is that managerial activity which is concerned with planning and controlling of the firm's financial such as fuel, power. 5. To meet the selling costs as packing, advertising, etc. 6. To provide credit BUSINESS MODEL RESOURCING PROMOTION ACTUALIZATION HARVESTING
resources. In other words, it is concerned with acquiring, financing and managing assets to facilities to the customers. 7. To meet the short-term obligation of a business enterprise. Assets IMPORTANCE OF ENTREPRENEURSHIP • Reduces poverty level. • Increases employment. •
accomplish the overall goal of a business enterprise (mainly to maximize the shareholder's Assets are the resources acquired by the business from the funds available either by owners of Fulfills the demand of people. • Helps to develop economic condition of a country. CAUSES OF
wealth). In today's world where positive cash flow is more important than book profit. Financial the business or others. It includes all rights or properties which a business owns, Cash FAILURE OF ENTREPRENEURSHIP • Lack of visible concept. • Lack of market knowledge. •
management can also be defined as planning for the future of a business enterprise to ensure a investments, stock of raw materials, land, building, patent rights, etc., are some examples of Lack of technical skill. • Lack of speed capital. • Lack of business knowledge. • Lack of
positive cash flow. Some experts also refer to financial management as the science of money assets Types of assets may be categorized as follows. Current assets Current assets include motivation. • Time pressure & distractions. CORPORATE SOCIAL RESPONSIBILITY (CSR)
management. IMPORTANCE OF FINANCIAL MANAGEMENT Financial management is cash and other assets that, under normal husmess conditions, can be converted into cash (CSR) focuses on the idea that a business has social obligations above and beyond making
indeed, the key to successful business operations. Without proper administration of finance, no within a short time frame (i.c., 1 year or less) Current assets include cash in hand, cash in bank, profit and follows a decision to expand traditional governance arrangements to include
business enterprise can reach its full potentials for growth and success. Financial management accounts receivable, etc Fixed assets Fixed assets have relatively permanent existence and accountability to the full range of stakeholders. Scope of CSR CSR is a way of integrating the
is all about planning investment, funding the investment, monitoring expenses against budget are not readily converted into cash. Fixed assets are held for the purpose of earning income and economic, social, and environmental imperatives of business activities. The term corporate
and managing gains from the investments. Financial management means management of all they are not sold in the course of business. Fixed assets include land, building, equipment and citizenship denotes the extent to which business enterprises meet the (a) legal, (b) ethical. (c)
matters related to an organization's finances. The best way to demonstrate the importance of machinery, furniture, transport vehicles, etc. Other assets Other; assets are those which do not economic and (d) voluntary / discretionary responsibilities, placed on them by their
good financial management is to describe some of the tasks that it involves the following. 1. fell into either current assets or fixed assets categories. Other assets include patents, stakeholders. Definition of CSR CSR is the continuing commitment by business to behave
Taking care not to over-invest in fixed assets 2. Balancing cash-outflow with cash-inflows 3. copyrights, franchises, goodwill, etc Functional budget 1. Sales budget 2. Production budget 3. ethically and contribute to economic development while improving the quality of the life of the
Ensuring that there is a sufficient level of short-term working capital 4. Setting sales revenue Capital expenditure budget 4. Selling and distribution cost budget 5. Administration expenses workforce and their families as well as of the local community and society at large. Need for
targets that will deliver growth 5. Increasing gross profit by setting the correct pricing for budget 6. Cash budget . ENTREPRENEURSHIP • Process of starting a new enterprise and CSR Corporate Social Responsibility is an important business strategy because, to some
products or services 6. Controlling the level of general and administrative expenses by finding operating it, so as to create a product, having value for people by giving necessary time and extent. ● A consumer wants to buy products from companies he trusts,A supplier wants to form
more cost-efficient ways of running the day-to-day business operations,and 7.Tax planning that effort, and bearing all the financial risks, difficulties and challenges, with an intention to make business partnership with companies he can rely on, ● An employee wants to work for a
will minimize the taxes a business has to pay. Objectives of financial management1.Profit profit. CONCEPT OF ENTREPRENEURSHIP • It is an innovation function. • It is a leadership company he respects. ● Other concerns want to establish business contacts with companies
maximization 2.Wealth/value maximization 3.Proper estimation of total financial requirements rather than an ownership. • The process of innovation may be in the form of: • Introduction of a seeking feasible solutions and innovations in areas of common concern.Corporate social
4.Proper utilization of finance 5.Proper coordination 6.Reduce cost of capital 7.Reduce new product. • Use of a new method of production. • Opening a new market. • The conquest of responsibility is basically a new business strategy to reduce investment risks and maximise
operating risks Functions of financial management Step 1 • Estimating capital requirement new source of supplying raw materials. ENTREPRENEUR • . A person with a unique idea, who profits by taking all the key stakeholders into confidence. It is a tool to increase the reputation of
Step 2 • Determining capital structure Step 3 • Estimating cash flow Step 4 • Investment takes initiative of developing a new venture, arranges all the resources and is ready to bear all the company in the eyes of society. It is certainly a business approach that creates a long term
decisions Step 5 • Dividend decisions Step 6 • Checking the performance Capital Capital the risks and takes all the necessary decisions to provide products and services that has value consumer and employee value by not only creating a 'green strategy' on natural environment
generally refers to saved-up financial wealth, especially which used to start or maintain a to the customer TYPES OF ENTREPRENEUR • 1) According to types of business: • Business but also considering every dimension of how a business operates in social, cultural and
business. Capital is necessary for an enterprise to keep it dynamic and covers money, land, entrepreneurs. • Trading entrepreneurs. • Industrial entrepreneurs. • Corporate entrepreneurs. • environment. The company should meet the needs of its all stakeholders (consumer,
building, machinery, materials, etc., develops products, keeps workers and machines at work Agricultural entrepreneurs.• 2)According to use of technology: • Technical entrepreneurs. • employees, shareholder. clients and other related persons) without sacrificing the ability to meet
and is necessary for the firm's progress and creating value. Every business needs funds for two Professional entrepreneurs. • Non-technical entrepreneurs. • High tech entrepreneurs.• the needs of the future stakeholders. Significance of CSR to Sustainability of Business The
purposes for its establishment and to carry out its day-to-day operations. Capital required for a 3)According to motivation of entrepreneurs: • Pure entrepreneurs. • Induced entrepreneurs. • CSR is important to the corporate to sustain in the environment and thus has the following
business can be classified under two main categories viz., fixed capital and working capital. Motivated entrepreneurs. • Spontaneous entrepreneurs. • 4)According to growth: • Growth significance: 1. Reduction in operative cost: Corporate social responsibility helps companies in
Fixed capital Long terms funds are required to create production facilities through purchase of entrepreneurs. • Super growth entrepreneurs. • 5)According to stages of development: • 1st reduction in operating cost, this may include recycling, water conservation, energy efficiency etc.
fixed assets such as land, plant and machinery, building, furniture, etc. Investments in these generation entrepreneurs. • Modern entrepreneurs. • Classical entrepreneurs. • 6)According to 2. Increased Sales and Customer Loyalty: The customers also recognize those companies
assets represent that part of firm's capital which is blocked on permanent or fixed basis and is scale of operation: • Small scale entrepreneurs. • Large scale entrepreneurs. which are socially responsible. This results in increased sales and content customers. 3. Higher
called fixed capital. The 'fixed' capital cannot be disposed of without breaking up the business. CHARECTERISTICS OF A SUCCESSFUL ENTREPRENEUR 1. High degree of commitment. productivity and Quality: Company as an essential of its triple bottom line, focuses on improving
Working capital Funds are also needed for short-term purposes for the purchase of raw 2. High energy level. 3. Foresightedness. 4. Desire for responsibility. 5. Risk taking ability. 6. the working conditions of employees. people in its suppy/distribution chain, which helps in
material, payment of wages and other day-to-day expenses, etc. These funds are known as Leadership and managerial skills. 7. Value for achievement over money. 8. Open-mindedness increased productivity with better quality. 4. Access to Capital: The companies with strong CSR
working capital. From the viewpoint of manufacturing process, working capital means that part and optimism9. Systematic planning. 10. Problem solving. 11. Concern for high quality of works. have increased access to capital that might not otherwise have been available. Even the lending
institutions are cautious and are considering this as an important parameter of granting loans. 5. successful inventions. As such they serve as an incentive for inventors to invent. With a patent,
Boost in Brand Image and Reputation: CSR is an essential brand building tool used by an inventor or small business knows there is 1. a good chance that they will get a return on the
companies to enhance its reputation amongst the stakeholders. INTELLECTUAL PROPERTY time, effort and money they invested in developing a technology. In sum. it means they can earn
RIGHTS INTELLECTUAL PROPERTY RIGHT Intellectual property (IP) is a category of a living , from their work. 2. . When a new technology comes onto the market. society as a
property that includes intangible creations of the human intellect. There are many types of whole stands to benefit both directly. because it may enable us to do something what was
intellectual property, and some countries recognize more than others. The best-known types are previously not possible, and indirectly in terms of the economic opportunities (business
copyrights, patents, trademarks, and trade secrets. Types of intellectual property rights development and employment) that can flow from it. 3. The revenues generated from
Copyright:- protects artistic expressions like music. films. plays. photos artwork. works of commercially successful patentprotected technologies make it possible to finance further
architecture and other creative works. The term "creative works" is defined very broadly for technological research and development (R&D), thereby improving the chances of even better
copyright purposes. such that copyright may be used to protect functional texts such as user technology becoming available in the future. 4 .A patent effectively turns an inventor's know-how
guides and product packaging as well as works of art.Design rights:- protect the shape and into a commercially tradable asset. opening up opportunities for business growth and job
form of a product, i.e., what it looks like (whereas the functionality of a product how it works - is creation through licensing and joint ventures 5 .Holding a patent also makes a small business
protected by a patent). Companies in vest a great deal of time and money in coming up with more attractive to investors who play a key role in enabling the commercialization of a
new and attractive designs that attract consumers into buying their products. Design is now technology.
widely recognized as a key determinant of commercial success.Trademarks:- signs that are
capable of distinguishing the goods or services of one enterprise from those of others.
Trademarks are indispensable tools in today's business world. They help companies expand
their market share and they help consumers identity the products they want to buy in a crowded
market place.Patent: A patent is an intellectual property (IP) right for a technical invention. It
allows you to prevent others from using your invention for commercial purposes for up to 20
years. You decide who is allowed to produce, sell or import your invention in those countries in
which you own a valid patent. Inventions and patents An invention is a new solution to a
technical problem and can be protected through patents. Patents protect the interests of
inventors whose technologies are truly groundbreaking and commercially successful, by
ensuring that an inventor can control the commercial use of their invention. An individual or
company that holds a patents has the rights to prevent others from making ,selling,retailing or
importing that technology .This creates opportunities for inventors to sell, trade or license their
patented technologies with others who may want to use them. The criteria that need to be
satisfied to obtain a patent are set out in national IP laws and may differ from one country to
another. But generally, to obtain a patent an inventor needs to demonstrate that their technology
is new (novel), useful and not obvious to someone working in the related field. To do this, they
are required to describe how their technology works and what it can do. * A patent can last up to
20 years, but the patent holder usually has to pay certain fees periodically throughout that 20-
year period for the patent to remain valid. * The patent holder may decide to abandon the
patent, at which point the technology falls into the public domain and may be freely used.
Patent information To recognizing and rewarding inventors for their commercially successful
technologies. patents also tell the world about inventions. To gain patent protection for their
invention, the inventor must provide a detailed explanation of how it works. In fact, every time
patent is granted, the amount of technological information that is freely available lo the general
public The International Patent System A patent is a private right that is granted by a
government authority I only has a legal effect in the country (or region) in which it is granted. So
inventors or companies that want to protect their technology in foreign markets need to seek
patent protection for their new technologies in those countries. How patents can support
inventors and improve lives 1. Patents recognize and reward inventors for their commercially