MANAGEMENT PRINCIPLES
CHAPTER 1
INTRODUCTION TO MANAGEMENT
1.2 ORGANISATIONS AND MANAGERS
All the products and services required to satisfy the consumer’s and, ultimately, society’s needs are
produced and provided by specialised organisations such as hypermarkets, sports clubs, universities, car
manufacturers, banks, guest houses, bicycle shops, hospitals, and airlines to mention but a few.
People’s lives are influenced in some way or another by the managers of these numerous business
organisations.
The following resources are used:
• Human resources
• Capital or financial resources
• Physical resources
• Information resources.
1.3 THE NATURE OF MANAGEMENT
Managers therefore combine, allocate, coordinate, and deploy resources or inputs in such a way that the
organisation’s goals are achieved as productively as possible. In doing so, management follows a
specific process. A process is a systematic way of doing things.
The entails 4 fundamental management functions: -
Planning
Organizing
Leading
Controlling
Organising
Resources Performance
Human Planning Leading Achieve goals
Financial Products
Physical Services
Controlling
Information Productivity
Profit
THE MANAGEMENT PROCESS COMPRISES PLANNING, ORGANISING, LEADING AND
CONTROLLING.
A model is a simplification of the real world in order to explain complex relationships in easy-to-
understand terms.
1|Page
, The fundamental functions of a manager link up in a specific sequence to form a process . Figure 1.2
illustrates the process as a logical sequence of actions.
Planning (Part II)
Managers determine the organisations
mission and goal and decide on a
Planning (Part II)
vision, strategy to achieve them
Controlling (Part V) Managers Organising (Part III) Managers group
monitor progressive and take corrective activities together, establish authority,
steps to reach mission and goals. allocate resources and delegate.
Leading (Part IV)
Managers direct and motivate members
of the organisation to achieve the mission
and goals
1.4 A DEFINITION OF MANAGEMENT
Management can be defined as the process ofplanning, organizing, leading, and controlling the
resources of the organisation to predetermined stated organisational goals as productively as possible.
Planning is the managementfunction that determinestheorganisation’svision, mission and goals. It
involves identifying ways of reaching the goals and finding the resources needed for the task. Tactical
plans are made by functional managers (such as financial, human resources, research and development,
marketing, and operations managers) to support the organisation’s long-term plans. Operationalplans
are made by lowermanagement (often called “first line” or “supervisory management”) to plan ahead
for short periods such as weekly and monthly schedules.
Organising is the second step in the management process. Tasks, roles, and responsibilities have to be
defined and policies and procedures established to achieve the goals. Organising involves developing a
framework or organisationalstructure to indicate how and where people and other resources should be
deployed to achieve the goals.
Leading refers to directing the human resources of the organisation and motivating them in such a way
that their actions are aligned with predetermined goals and plans. Leading the organisations means
making use of influence and power to motivateemployees to achieve organisational goals. Leading can
also mean change, which may be necessary to keep the organisation on track.
Controlling means that managers should constantly make sure that the organisations is on the right course
toattainitsgoals. To monitor performance and action, ensuring that they conform to plans to attain the
predetermined goals. Control also includes the measurement of performance to determine how well
the goals have been achieved. Feeding back results is an important aspect of control.
1.5 DIFFERENT LEVELS AND KINDS OF MANAGEMENT IN THE ORGANISATION.
Managers are usually classified into two categories; -
2|Page
,1. According to their level in the organisation (the top, middle, and lower or first-line managers)
and
2. By the functional or specialist area of management for which they are responsible (the
functional managers)
Figure 1.4 indicates how managers within an organisation can be differentiated according to level and
functional area.
1.5.1 TOP MANAGEMENT
Top management represents the relatively smallgroupofmanagers who leadtheorganisation. Top
management is usually responsible for the organisationasawhole, as well as for determining its vision,
mission, goals, and overall strategies of the entire organisation. Top management is concerned mainly
with long-term planning, designing the organisation’s broad organisational structure, leading the
organisation (through the topexecutive), and controlling it. It also influences the corporate culture.
1.5.2 MIDDLE MANAGEMENT
Middle management is responsible for specificdepartments of the organisation and is primarily
concerned with implementingthepolicies, plans, and strategies formulated by top management. It is
responsible for medium-term and short-term planning, organizing functional areas. Middle managers also
continually monitor environmental influences that may affect their own departments.
1.5.3 LOWER/FIRST-LINE MANAGEMENT
Lower or first-line management is responsible for even smaller segments of the organisation, namely
the different sub-sections. First-line managers are centered on the daily activities of their
departments or sections, on short-term planning, and on implementing the plans of middle management.
Their primary concern is to apply policies, procedures, and rules to achieve a high level of productivity.
These managers hold the power to increase or decrease the productivity of most organisations. They
also maintain the crucial interface between management and the major body of employees in the
organisations.
Figure 1.5 illustrates how the four functions of planning, organizing, leading, and controlling differ for
the three management levels at a specific organisation.
Planning Organising Leading Controlling
Top managers 28% 36% 22% 14%
Middle managers 18% 33% 36% 13%
Lower Managers 15% 24% 51% 10%
1.6 AREAS OF MANAGEMENT
The general management function includes an examination of the management process as a whole.
The marketing function entails the marketing of the products or services of the organisation.
The financial function includes the acquisition, utilization, and control of the money the
organisation need to finance its activities.
The production or operations management function includes that group of activities concerned
with the physical production of products, namely the establishment and layout of the production
unit.
The purchasing function entails the acquisition of all products and materials required by the
business to function profitably, namely raw materials, components, tools, equipment and the
inventory.
3|Page
, The researchanddevelopment function is responsible for developingnewproducts and improving old
products.
The human resource function entails the appointment, development, and maintenance of the
human resources of the organisation.
The publicrelations function of an organisation is to create a favourable, objective image of the
organisation and to establish good relations with those directly or indirectly concerned with the
business and its products or services.
1.7 THE ROLE DISTRIBUTION OF MANAGERS
In Figure 1.6 can be classified into three overlapping groups, namely and interpersonal role, and
information role, and a decision-making role.
The interpersonal role
- Acts as a figureheadforthemine.
- Second, all managers have a role as a leader.
- The third role within the set of interpersonal roles is liaison, which aims at maintaining good
relations within and outside the organisation.
The information role
- Enables them to obtaininformationfromcolleagues, subordinates, and departmentheads, as well as
outsidepersons, and they can use this information for making decisions. I
- Involves monitoring or gathering information on trends and passing on relevant information to
colleagues, superiors, and subordinates.
- Also entails acting as a spokesperson for the department or for the whole organization.
The decision-making role
- Manager is regarded as an entrepreneur, using information to introduce a new product or idea.
- A manager also has to deal with and solveproblems such as strikes, shortages, or broken
equipment.
- Managers must makedecisions about the resources available to the organisation. Resource
allocated, or deciding to whom resources such as money, people, and equipment are to be assigned.
- As negotiators, managers often have to negotiate with individuals, other departments or
organisation and trade unions about goals, standards of performance and resources.
Interpersonal Role
Figurehead Leader
Relationship builder
Decision-making role Information Role
Entrepreneur Problem Monitor Analyser
solver Spokesperson
Allocator of resources
Negotiator
1.8 MANAGERIAL SKILLS AND COMPETENCIES AT VARIOUS MANAGERIAL
LEVELS.
The following three main skills are identified as prerequisites for sound management.
1. Conceptual skills refer to the mentalability to view the operation of the organisation and its parts
holistically. Skills involve the manager’s thinking and planning abilities and are mostly demanded
by top management,
4|Page
CHAPTER 1
INTRODUCTION TO MANAGEMENT
1.2 ORGANISATIONS AND MANAGERS
All the products and services required to satisfy the consumer’s and, ultimately, society’s needs are
produced and provided by specialised organisations such as hypermarkets, sports clubs, universities, car
manufacturers, banks, guest houses, bicycle shops, hospitals, and airlines to mention but a few.
People’s lives are influenced in some way or another by the managers of these numerous business
organisations.
The following resources are used:
• Human resources
• Capital or financial resources
• Physical resources
• Information resources.
1.3 THE NATURE OF MANAGEMENT
Managers therefore combine, allocate, coordinate, and deploy resources or inputs in such a way that the
organisation’s goals are achieved as productively as possible. In doing so, management follows a
specific process. A process is a systematic way of doing things.
The entails 4 fundamental management functions: -
Planning
Organizing
Leading
Controlling
Organising
Resources Performance
Human Planning Leading Achieve goals
Financial Products
Physical Services
Controlling
Information Productivity
Profit
THE MANAGEMENT PROCESS COMPRISES PLANNING, ORGANISING, LEADING AND
CONTROLLING.
A model is a simplification of the real world in order to explain complex relationships in easy-to-
understand terms.
1|Page
, The fundamental functions of a manager link up in a specific sequence to form a process . Figure 1.2
illustrates the process as a logical sequence of actions.
Planning (Part II)
Managers determine the organisations
mission and goal and decide on a
Planning (Part II)
vision, strategy to achieve them
Controlling (Part V) Managers Organising (Part III) Managers group
monitor progressive and take corrective activities together, establish authority,
steps to reach mission and goals. allocate resources and delegate.
Leading (Part IV)
Managers direct and motivate members
of the organisation to achieve the mission
and goals
1.4 A DEFINITION OF MANAGEMENT
Management can be defined as the process ofplanning, organizing, leading, and controlling the
resources of the organisation to predetermined stated organisational goals as productively as possible.
Planning is the managementfunction that determinestheorganisation’svision, mission and goals. It
involves identifying ways of reaching the goals and finding the resources needed for the task. Tactical
plans are made by functional managers (such as financial, human resources, research and development,
marketing, and operations managers) to support the organisation’s long-term plans. Operationalplans
are made by lowermanagement (often called “first line” or “supervisory management”) to plan ahead
for short periods such as weekly and monthly schedules.
Organising is the second step in the management process. Tasks, roles, and responsibilities have to be
defined and policies and procedures established to achieve the goals. Organising involves developing a
framework or organisationalstructure to indicate how and where people and other resources should be
deployed to achieve the goals.
Leading refers to directing the human resources of the organisation and motivating them in such a way
that their actions are aligned with predetermined goals and plans. Leading the organisations means
making use of influence and power to motivateemployees to achieve organisational goals. Leading can
also mean change, which may be necessary to keep the organisation on track.
Controlling means that managers should constantly make sure that the organisations is on the right course
toattainitsgoals. To monitor performance and action, ensuring that they conform to plans to attain the
predetermined goals. Control also includes the measurement of performance to determine how well
the goals have been achieved. Feeding back results is an important aspect of control.
1.5 DIFFERENT LEVELS AND KINDS OF MANAGEMENT IN THE ORGANISATION.
Managers are usually classified into two categories; -
2|Page
,1. According to their level in the organisation (the top, middle, and lower or first-line managers)
and
2. By the functional or specialist area of management for which they are responsible (the
functional managers)
Figure 1.4 indicates how managers within an organisation can be differentiated according to level and
functional area.
1.5.1 TOP MANAGEMENT
Top management represents the relatively smallgroupofmanagers who leadtheorganisation. Top
management is usually responsible for the organisationasawhole, as well as for determining its vision,
mission, goals, and overall strategies of the entire organisation. Top management is concerned mainly
with long-term planning, designing the organisation’s broad organisational structure, leading the
organisation (through the topexecutive), and controlling it. It also influences the corporate culture.
1.5.2 MIDDLE MANAGEMENT
Middle management is responsible for specificdepartments of the organisation and is primarily
concerned with implementingthepolicies, plans, and strategies formulated by top management. It is
responsible for medium-term and short-term planning, organizing functional areas. Middle managers also
continually monitor environmental influences that may affect their own departments.
1.5.3 LOWER/FIRST-LINE MANAGEMENT
Lower or first-line management is responsible for even smaller segments of the organisation, namely
the different sub-sections. First-line managers are centered on the daily activities of their
departments or sections, on short-term planning, and on implementing the plans of middle management.
Their primary concern is to apply policies, procedures, and rules to achieve a high level of productivity.
These managers hold the power to increase or decrease the productivity of most organisations. They
also maintain the crucial interface between management and the major body of employees in the
organisations.
Figure 1.5 illustrates how the four functions of planning, organizing, leading, and controlling differ for
the three management levels at a specific organisation.
Planning Organising Leading Controlling
Top managers 28% 36% 22% 14%
Middle managers 18% 33% 36% 13%
Lower Managers 15% 24% 51% 10%
1.6 AREAS OF MANAGEMENT
The general management function includes an examination of the management process as a whole.
The marketing function entails the marketing of the products or services of the organisation.
The financial function includes the acquisition, utilization, and control of the money the
organisation need to finance its activities.
The production or operations management function includes that group of activities concerned
with the physical production of products, namely the establishment and layout of the production
unit.
The purchasing function entails the acquisition of all products and materials required by the
business to function profitably, namely raw materials, components, tools, equipment and the
inventory.
3|Page
, The researchanddevelopment function is responsible for developingnewproducts and improving old
products.
The human resource function entails the appointment, development, and maintenance of the
human resources of the organisation.
The publicrelations function of an organisation is to create a favourable, objective image of the
organisation and to establish good relations with those directly or indirectly concerned with the
business and its products or services.
1.7 THE ROLE DISTRIBUTION OF MANAGERS
In Figure 1.6 can be classified into three overlapping groups, namely and interpersonal role, and
information role, and a decision-making role.
The interpersonal role
- Acts as a figureheadforthemine.
- Second, all managers have a role as a leader.
- The third role within the set of interpersonal roles is liaison, which aims at maintaining good
relations within and outside the organisation.
The information role
- Enables them to obtaininformationfromcolleagues, subordinates, and departmentheads, as well as
outsidepersons, and they can use this information for making decisions. I
- Involves monitoring or gathering information on trends and passing on relevant information to
colleagues, superiors, and subordinates.
- Also entails acting as a spokesperson for the department or for the whole organization.
The decision-making role
- Manager is regarded as an entrepreneur, using information to introduce a new product or idea.
- A manager also has to deal with and solveproblems such as strikes, shortages, or broken
equipment.
- Managers must makedecisions about the resources available to the organisation. Resource
allocated, or deciding to whom resources such as money, people, and equipment are to be assigned.
- As negotiators, managers often have to negotiate with individuals, other departments or
organisation and trade unions about goals, standards of performance and resources.
Interpersonal Role
Figurehead Leader
Relationship builder
Decision-making role Information Role
Entrepreneur Problem Monitor Analyser
solver Spokesperson
Allocator of resources
Negotiator
1.8 MANAGERIAL SKILLS AND COMPETENCIES AT VARIOUS MANAGERIAL
LEVELS.
The following three main skills are identified as prerequisites for sound management.
1. Conceptual skills refer to the mentalability to view the operation of the organisation and its parts
holistically. Skills involve the manager’s thinking and planning abilities and are mostly demanded
by top management,
4|Page
