CHAPTER

“Good decision come from

5
[Please insert any
relevant photo experience; Experience
around t comes from making bad
his box] decision”- Mark Twain

Main Functions of
Management
Subtopics:-
5.1 Planning, Organizing, Leading and Controlling
5.2 How Does These Function Works in An Organization
5.3 Who Is Responsible for Each Function
5.4 The Importance to Carry Out Each Function Effectively
5.5 Discussion Questions

5.1 PLANNING, ORGANIZING, LEADING AND CONTROLLING

Management is a process of planning, organizing, leading and controlling the organizing

resources like human, financial, physical and information to achieve organization objective.
There are 4 management function:

1. Planning - Defining goals, establishing strategies to achieve goals, developing plans

to integrate and coordinate activities.
2. Organizing - Arranging work to accomplish organizational goals. Build a relationship
structure to execute plans.
3. Leading - Working with and through people to accomplish goals. And motivate
individuals in organization to completed task.
4. Controlling - Monitoring, comparing, and correcting the work.

21 | P a g e C h a p t e r 5 : M a i n F u n c t i o n s o f M a n a g e m e n t
5.2 HOW DOES THIS FUNCTION WORKS IN AN ORGANIZATION?

1. Planning

Planning is the function of management that involves setting objectives and determining a
course of action for achieving these objectives. Planning requires that managers be aware
of environmental conditions facing their organization and forecast future conditions. It also
requires that managers be good decision-makers.

Planning is a process consisting of several steps. The process begins with environmental
scanning, which simply means that planners must be aware of the critical contingencies
facing their organization in terms of economic conditions, their competitors, and their
customers. Planners must then attempt to forecast future conditions. These forecasts form
the basis for planning.

Planners must establish objectives, which are statements of what needs to be achieved
and when. Planners must then identify alternative courses of action for achieving
objectives. After evaluating the various alternatives, planners must make decisions about
the best courses of action for achieving objectives. They must then formulate necessary
steps and ensure effective implementation of plans.

Finally, planners must constantly evaluate the success of their plans and take corrective
action when necessary.

There are many different types of plans and planning.

i. Strategic planning

Strategic planning involves analyzing competitive opportunities and threats, as well as the
strengths and weaknesses of the organization, and then determining how to position the
organization to compete effectively in their environment. Strategic planning has a long-
time frame, often three years or more.

Strategic planning generally includes the entire organization and includes formulation of
objectives. Strategic planning is often based on the organization's mission, which is its
fundamental reason for existence. An organization's top management most often
conducts strategic planning.

22 | P a g e C h a p t e r 5 : M a i n F u n c t i o n s o f M a n a g e m e n t
 ii. Tactical planning

Tactical planning is intermediate-range planning that is designed to develop relatively

concrete and specific means to implement the strategic plan. Middle-level managers often
engage in tactical planning. Tactical planning often has a one- to three-year time horizon.

iii. Operational planning

Operational planning generally assumes the existence of objectives and specifies ways to
achieve them. Operational planning is short-range planning that is designed to develop
specific action steps that support the strategic and tactical plans. Operational planning
usually has a very short time horizon, from one week to one year.

2. Organizing

Organizing is the function of management that involves developing an organizational

structure and allocating human resources to ensure the accomplishment of objectives. The
structure of the organization is the framework within which effort is coordinated. The
structure is usually represented by an organization chart, which provides a graphic
representation of the chain of command within an organization. Decisions made about the
structure of an organization are generally referred to as "organizational design" decisions.

Organizing also involves the design of individual jobs within the organization. Decisions must
be made about the duties and responsibilities of individual jobs as well as the way the duties
should be carried out. Decisions made about the nature of jobs within the organization are
generally called "job design" decisions.

Organizing at the level of the organization involves deciding how best to departmentalize,
or cluster jobs into departments to effectively coordinate effort. There are many ways to
departmentalize, including organizing by function, product, geography, or customer.

Many larger organizations utilize multiple methods of departmentalization. Organizing at

the level of job involves how best to design individual jobs to most effectively use human
resources.

23 | P a g e C h a p t e r 5 : M a i n F u n c t i o n s o f M a n a g e m e n t
Traditionally, job design was based on principles of division of labor and specialization,
which assumed that the narrower the job content, the more proficient the individual
performing the job could become.

However, experience has shown that it is possible for jobs to become too narrow and
specialized. When this happens, negative outcomes result, including decreased job
satisfaction and organizational commitment and increased absenteeism and turnover.

Recently many organizations have attempted to strike a balance between the need for
worker specialization and the need for workers to have jobs that entail variety and
autonomy. Many jobs are now designed based on such principles as job enrichment and
teamwork.

3. Leading

Leading involves influencing others toward the attainment of organizational objectives.

Effective leading requires the manager to motivate subordinates, communicate
effectively, and effectively use power. If managers are effective leaders, their subordinates
will be enthusiastic about exerting effort toward the attainment of organizational
objectives.

To become effective at leading, managers must first understand their subordinates'

personalities, values, attitudes, and emotions. Therefore, the behavioral sciences have
made many contributions to the understanding of this function of management. Personality
research and studies of job attitudes provide important information as to how managers
can most effectively lead subordinates.

Studies of motivation and motivation theory provide important information about the ways
in which workers can be energized to put forth productive effort. Studies of communication
provide direction as to how managers can effectively and persuasively communicate.

Studies of leadership and leadership style provide information regarding questions such as,
"What makes a manager a good leader?" and "In what situations are certain leadership
styles most appropriate and effective?"

24 | P a g e C h a p t e r 5 : M a i n F u n c t i o n s o f M a n a g e m e n t
4. Controlling

Controlling involves ensuring that performance does not deviate from standards.
Controlling consists of three steps, which include establishing performance standards,
comparing actual performance against standards, and taking corrective action when
necessary.

Performance standards are often stated in monetary terms such as revenue, costs, or profits,
but may also be stated in other terms, such as units produced, number of defective
products, or levels of customer service.

The measurement of performance can be done in several ways, depending on the

performance standards, including financial statements, sales reports, production results,
customer satisfaction, and formal performance appraisals. Managers at all levels engage
in the managerial function of controlling to some degree.

The managerial function of controlling should not be confused with control in the behavioral
or manipulative sense. This function does not imply that managers should attempt to control
or manipulate the personalities, values, attitudes, or emotions of their subordinates.

Instead, this function of management concerns the manager's role in taking necessary
actions to ensure that the work-related activities of subordinates are consistent with and
contributing toward the accomplishment of organizational and departmental objectives.

Effective controlling requires the existence of plans, since planning provides the necessary
performance standards or objectives. Controlling also requires a clear understanding of
where responsibility for deviations from standards lies. Two traditional control techniques are
the budget and the performance audit.

Although controlling is often thought of in terms of financial criteria, managers must also
control production/operations processes, procedures for delivery of services, compliance
with company policies, and many other activities within the organization.

The management functions of planning, organizing, leading, and controlling are widely
considered to be the best means of describing the manager's job as well as the best way
to classify accumulated knowledge about the study of management.
25 | P a g e C h a p t e r 5 : M a i n F u n c t i o n s o f M a n a g e m e n t
Although there have been tremendous changes in the environment faced by managers
and the tools used by managers to perform their roles, managers still perform these essential
functions.

5.3 WHO IS RESPONSIBLE FOR EACH FUNCTIONS?

Managers are someone who works with and through other people by coordinating their
work activities in order to accomplish organizational goals. However, keep in mind that
managers may have other work duties not related to integrating the work of others.

The changing nature of organizations and work has blurred the clear lines of distinction
between managers and non-managerial employees. Many workers’ jobs now include
managerial activities. Definitions used in the past no longer work.

A good manager should have these three basic management skills:

I. Technical Skills:

• Involves process or technique knowledge and proficiency. Managers use the

processes, techniques and tools of a specific area.
• This skill is especially important for first line managers because many of this manager
spend time helping employees solve worked related problems, training, then in most
efficient procedures and monitoring performance.

II. Human Skills:

• Involves the ability to communication effectively with people. Managers interact and
cooperate with employees.
• Although the interpersonal skill is important for al level of people, but it is most
importance for middle manager since they are the bridge of communication
between lower level and top-level manager.

III. Conceptual Skills:

• involves the formulation of ideas. Managers understand abstract relationships,

develop ideas, and solve problems creatively.

26 | P a g e C h a p t e r 5 : M a i n F u n c t i o n s o f M a n a g e m e n t
 • The ability to think and to conceptualize about abstract and complex situations, to
see the organization, and to understand the relationships among the various subunits,
and to visualize how the organization fits into its broader environment.

Figure 5.1

5.4 THE IMPORTANCE TO CARRY OUT EACH FUNCTION EFFECTIVELY

The importance of management function

i. Will be used to organize organization resources like raw material, human, physical
and information.
ii. Management will reduce the wastage level of resources.
iii. To achieve effectiveness in using resources, management function must be
implemented efficiently.
iv. The importance of management will be implemented by a manager.

27 | P a g e C h a p t e r 5 : M a i n F u n c t i o n s o f M a n a g e m e n t
5.5 DISCUSSION QUESTION

1. Define the term manager.

2. Discuss FOUR (4) functions of management in an organization.
3. Compare strategic planning, tactical planning and operational planning.
4. List and explain THREE (3) managerial skills that all manager should have.
5. Controlling consists of three steps which include establishing performance standards,
comparing actual performance against standards, and taking corrective action
when necessary. Explain.

28 | P a g e C h a p t e r 5 : M a i n F u n c t i o n s o f M a n a g e m e n t