What is Management?

Management is a universal phenomenon. It is a very popular and widely used term. All
organizations - business, political, cultural or social are involved in management because it is the
management which helps and directs the various efforts towards a definite purpose. According to
Harold Koontz, “Management is an art of getting things done through and with the people in
formally organized groups. It is an art of creating an environment in which people can perform
and individuals and can co-operate towards attainment of group goals”. According to F.W.
Taylor, “Management is an art of knowing what to do, when to do and see that it is done in the
best and cheapest way”.

Management is a purposive activity. It is something that directs group efforts towards the
attainment of certain pre - determined goals. It is the process of working with and through others
to effectively achieve the goals of the organization, by efficiently using limited resources in the
changing world. Of course, these goals may vary from one enterprise to another. E.g.: For one
enterprise it may be launching of new products by conducting market surveys and for other it
may be profit maximization by minimizing cost.

Management involves creating an internal environment: - It is the management which puts into
use the various factors of production. Therefore, it is the responsibility of management to create
such conditions which are conducive to maximum efforts so that people are able to perform their
task efficiently and effectively. It includes ensuring availability of raw materials, determination
of wages and salaries, formulation of rules & regulations etc.

Therefore, we can say that good management includes both being effective and efficient. Being
effective means doing the appropriate task i.e, fitting the square pegs in square holes and round
pegs in round holes. Being efficient means doing the task correctly, at least possible cost with
minimum wastage of resources.

The concept of management has acquired special significance in the present competitive and
complex business world. Efficient and purposeful management is absolutely essential for the
survival of a business unit. Management concept is comprehensive and covers all aspects of
business. In simple words, management means utilising available resources in the best possible
manner and also for achieving well defined objectives. It is a distinct and dynamic process
involving use of different resources for achieving well defined objectives. The resources are:
men, money, materials, machines, methods and markets. These are the six basic inputs in
management process (six M's of management) and the output is in the form of achievement of
objectives. It is the end result of inputs and is

The term 'management' is used extensively in business. It is the core or life giving element in
business. We expect that a business unit should be managed efficiently. This is precisely what is
done in management. Management is essential for the conduct of business activity in an orderly
manner. It is a vital function concerned with all aspects of working of an enterprise
Management can be defined in detail in following categories :

1. Management as a Process

2. Management as an Activity

3. Management as a Discipline

4. Management as a Group

5. Management as a Science

6. Management as an Art

7. Management as a Profession

As a process, management refers to a series of inter - related functions. It is the process by which
management creates, operates and directs purposive organization through systematic,
coordinated and co-operated human efforts, according to George R. Terry, “Management is a
distinct process consisting of planning, organizing, actuating and controlling, performed to
determine and accomplish stated objective by the use of human beings and other resources”. As a
process, management consists of three aspects:

1. Management is a social process - Since human factor is most important among the other
factors, therefore management is concerned with developing relationship among people. It is the
duty of management to make interaction between people - productive and useful for obtaining
organizational goals.

2. Management is an integrating process - Management undertakes the job of bringing

together human physical and financial resources so as to achieve organizational purpose.
Therefore, is an important function to bring harmony between various factors.

3. Management is a continuous process - It is a never ending process. It is concerned with

constantly identifying the problem and solving them by taking adequate steps. It is an on-going
process.
Management is an activity concerned with guiding human and physical resources such that
organizational goals can be achieved. Nature of management can be highlighted as: -

1. Management is Goal-Oriented: The success of any management activity is assessed by its

achievement of the predetermined goals or objective. Management is a purposeful activity. It is a
tool which helps use of human & physical resources to fulfill the pre-determined goals. For
example, the goal of an enterprise is maximum consumer satisfaction by producing quality goods
and at reasonable prices. This can be achieved by employing efficient persons and making better
use of scarce resources.

2. Management integrates Human, Physical and Financial Resources: In an organization,

human beings work with non-human resources like machines. Materials, financial assets,
buildings etc. Management integrates human efforts to those resources. It brings harmony among
the human, physical and financial resources.

3. Management is Continuous: Management is an ongoing process. It involves continuous

handling of problems and issues. It is concerned with identifying the problem and taking
appropriate steps to solve it. E.g. the target of a company is maximum production. For achieving
this target various policies have to be framed but this is not the end. Marketing and Advertising
is also to be done. For this policies have to be again framed. Hence this is an ongoing process.

4. Management is all Pervasive: Management is required in all types of organizations

whether it is political, social, cultural or business because it helps and directs various efforts
towards a definite purpose. Thus clubs, hospitals, political parties, colleges, hospitals, business
firms all require management. When ever more than one person is engaged in working for a
common goal, management is necessary. Whether it is a small business firm which may be
engaged in trading or a large firm like Tata Iron & Steel, management is required everywhere
irrespective of size or type of activity.

5. Management is a Group Activity: Management is very much less concerned with

individual’s efforts. It is more concerned with groups. It involves the use of group effort to
achieve predetermined goal of management of ABC & Co. is good refers to a group of persons
managing the enterprise

The main objectives of management are:

1. Getting Maximum Results with Minimum Efforts - The main objective of management is
to secure maximum outputs with minimum efforts & resources. Management is basically
concerned with thinking & utilizing human, material & financial resources in such a manner that
would result in best combination. This combination results in reduction of various costs.

2. Increasing the Efficiency of factors of Production - Through proper utilization of various

factors of production, their efficiency can be increased to a great extent which can be obtained by
reducing spoilage, wastages and breakage of all kinds, this in turn leads to saving of time, effort
and money which is essential for the growth & prosperity of the enterprise.

3. Maximum Prosperity for Employer & Employees - Management ensures smooth and
coordinated functioning of the enterprise. This in turn helps in providing maximum benefits to
the employee in the shape of good working condition, suitable wage system, incentive plans on
the one hand and higher profits to the employer on the other hand.

4. Human betterment & Social Justice - Management serves as a tool for the upliftment as
well as betterment of the society. Through increased productivity & employment, management
ensures better standards of living for the society. It provides justice through its uniform policies.

Administration means overall determination of policies, setting of major objectives, the

identification of general purposes and laying down of broad programmes and projects”. It refers
to the activities of higher level. It lays down basic principles of the enterprise. According to
Newman, “Administration means guidance, leadership & control of the efforts of the groups
towards some common goals”.

Whereas, management involves conceiving, initiating and bringing together the various
elements; coordinating, actuating, integrating the diverse organizational components while
sustaining the viability of the organization towards some pre-determined goals. In other words, it
is an art of getting things done through & with the people in formally organized groups.

The difference between Management and Administration can be summarized under 2 categories:
-
1. Functions

2. Usage / Applicability

On the basis of functions

Basis Management Administration

Meaning Management is an art of It is concerned with formulation of broad

getting things done through objectives, plans & policies.
others by directing their
efforts towards
achievement of pre-
determined goals.

Nature Management is an Administration is a decision-making function.

executing function.

Process Management decides who Administration decides what is to be done & when
should as it & how should it is to be done.
he dot it.

Function Management is a doing Administration is a thinking function because

function because managers plans & policies are determined under it.
get work done under their
supervision.

Skills Technical and Human Conceptual and Human skills

skills

Level Middle & lower level Top level function

function

On the Basis of Usage: -

Basis Management Administration

Applica It is applicable to business It is applicable to non-business concerns i.e. clubs,
bility concerns i.e. profit-making schools, hospitals etc.
organization.

Influen The management decisions The administration is influenced by public

ce are influenced by the opinion, govt. policies, religious organizations,
values, opinions, beliefs & customs etc.
decisions of the managers.

Status Management constitutes Administration represents owners of the enterprise

the employees of the who earn return on their capital invested & profits
organization who are paid in the form of dividend.
remuneration (in the form
of salaries & wages).

Practically, there is no difference between management & administration. Every manager is

concerned with both - administrative management function and operative management function
as shown in the figure. However, the managers who are higher up in the hierarchy denote more
time on administrative function & the lower level denote more time on directing and controlling
worker’s performance i.e. management.

The Figure above clearly shows the degree of administration and management performed by the
different levels of management

Co-ordination is the unification, integration, synchronization of the efforts of group members so

as to provide unity of action in the pursuit of common goals. It is a hidden force which binds all
the other functions of management. According to Mooney and Reelay, “Co-ordination is orderly
arrangement of group efforts to provide unity of action in the pursuit of common goals”.
According to Charles Worth, “Co-ordination is the integration of several parts into an orderly
hole to achieve the purpose of understanding”.

Management seeks to achieve co-ordination through its basic functions of planning, organizing,
staffing, directing and controlling. That is why, co-ordination is not a separate function of
management because achieving of harmony between individuals efforts towards achievement of
group goals is a key to success of management. Co-ordination is the essence of management and
is implicit and inherent in all functions of management.

A manager can be compared to an orchestra conductor since both of them have to create rhythm
and unity in the activities of group members. Co-ordination is an integral element or ingredient
of all the managerial functions as discussed below: -

a. Co-ordination through Planning - Planning facilitates co-ordination by integrating

the various plans through mutual discussion, exchange of ideas. e.g. - co-ordination between
finance budget and purchases budget.

b. Co-ordination through Organizing - Mooney considers co-ordination as the very essence

of organizing. In fact when a manager groups and assigns various activities to subordinates, and
when he creates department’s co-ordination uppermost in his mind.

c. Co-ordination through Staffing - A manager should bear in mind that the right no. of
personnel in various positions with right type of education and skills are taken which will ensure
right men on the right job.

d. Co-ordination through Directing - The purpose of giving orders, instructions & guidance
to the subordinates is served only when there is a harmony between superiors & subordinates.

a.e. Co-ordination through Controlling - Manager ensures that there should be co-ordination
between actual performance & standard performance to achieve organizational goals.

From above discussion, we can very much affirm that co-ordination is the very much essence of
management. It is required in each & every function and at each & every stage & therefore it
cannot be separated.

Co-ordination is an orderly arrangement of efforts to provide unity of action in the fulfillment of

common objective whereas co-operation denotes collective efforts of persons working in an
enterprise voluntarily for the achievement of a particular purpose. It is the willingness of
individuals to help each other.

Co-ordination is an effort to integrate effectively energies of different groups whereas co-

operation is sort to achieve general objectives of business.
The term “Levels of Management’ refers to a line of demarcation between various managerial
positions in an organization. The number of levels in management increases when the size of the
business and work force increases and vice versa. The level of management determines a chain
of command, the amount of authority & status enjoyed by any managerial position. The levels of
management can be classified in three broad categories: -

1. Top level / Administrative level

2. Middle level / Executory

3. Low level / Supervisory / Operative / First-line managers

Managers at all these levels perform different functions. The role of managers at all the three
levels is discussed below:

1. Top Level of Management

It consists of board of directors, chief executive or managing director. The top management is
the ultimate source of authority and it manages goals and policies for an enterprise. It devotes
more time on planning and coordinating functions.

The role of the top management can be summarized as follows -

a. Top management lays down the objectives and broad policies of the enterprise.

b. It issues necessary instructions for preparation of department budgets, procedures,

schedules etc.

c. It prepares strategic plans & policies for the enterprise.

d. It appoints the executive for middle level i.e. departmental managers.

e. It controls & coordinates the activities of all the departments.

f. It is also responsible for maintaining a contact with the outside world.

g. It provides guidance and direction.

h. The top management is also responsible towards the shareholders for the performance of
the enterprise.

2. Middle Level of Management

The branch managers and departmental managers constitute middle level. They are responsible
to the top management for the functioning of their department. They devote more time to
organizational and directional functions. In small organization, there is only one layer of middle
level of management but in big enterprises, there may be senior and junior middle level
management. Their role can be emphasized as -

a. They execute the plans of the organization in accordance with the policies and directives
of the top management.

b. They make plans for the sub-units of the organization.

c. They participate in employment & training of lower level management.

d. They interpret and explain policies from top level management to lower level.

e. They are responsible for coordinating the activities within the division or department.

f. It also sends important reports and other important data to top level management.

g. They evaluate performance of junior managers.

h. They are also responsible for inspiring lower level managers towards better performance.

3. Lower Level of Management

Lower level is also known as supervisory / operative level of management. It consists of

supervisors, foreman, section officers, superintendent etc. According to R.C. Davis,
“Supervisory management refers to those executives whose work has to be largely with personal
oversight and direction of operative employees”. In other words, they are concerned with
direction and controlling function of management. Their activities include -

a. Assigning of jobs and tasks to various workers.

b. They guide and instruct workers for day to day activities.

c. They are responsible for the quality as well as quantity of production.

d. They are also entrusted with the responsibility of maintaining good relation in the
organization.

e. They communicate workers problems, suggestions, and recommendatory appeals etc to

the higher level and higher level goals and objectives to the workers.

f. They help to solve the grievances of the workers.

g. They supervise & guide the sub-ordinates.

h. They are responsible for providing training to the workers.

i. They arrange necessary materials, machines, tools etc for getting the things done.

j. They prepare periodical reports about the performance of the workers.

k. They ensure discipline in the enterprise.

l. They motivate workers.

m. They are the image builders of the enterprise because they are in direct contact with the
workers.
Best Wishes:-

Dr.Divya