Management Basics

What is Management?

Management is a universal practice, like the conductor of an orchestra, harmonizing various efforts towards a common goal.

As Harold Koontz aptly put it, “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 can cooperate towards the attainment of group goals.“

Consider F.W. Taylor’s perspective: “Management is an art of knowing what to do, when to do, and seeing that it is done in the best and cheapest way.” This emphasizes the precision and efficiency that management demands.

At its core, management is a purposeful activity. Think of it as the captain steering a ship towards a predetermined destination.

As Peter Drucker famously said, “Management is doing things right; leadership is doing the right things.” This distinction underscores the importance of both effective execution and strategic decision-making.

Management is about more than just keeping things running. It’s a dynamic process that adapts to changing circumstances.

As Stephen Covey noted, “Management is efficiency in climbing the ladder of success; leadership determines whether the ladder is leaning against the right wall.” This highlights the critical role of leadership within the management process.

But what’s the ultimate goal of management? It varies from one organization to another.

To quote Peter Drucker again, “The best way to predict your future is to create it.” Management is about shaping the future of an organization.

Management also entails creating the optimal conditions for work, much like setting the stage for a play. This involves ensuring resources are available and rules are in place.

As Peter Drucker wisely stated, “The aim of marketing is to know and understand the customer so well the product or service fits him and sells itself.” Management includes aligning an organization’s offerings with the needs of its customers.

Management as a Process

Management isn’t a static concept; it’s a dynamic process that involves several interconnected functions. It’s the way organizations plan, organize, execute, and oversee activities, all guided by specific goals and carried out through the coordinated efforts of people.

According to George R. Terry, “Management is a distinct process consisting of planning, organizing, actuating, and controlling, performed to determine and accomplish stated objectives by using human beings and other resources.” This definition encapsulates the essence of management as a process.

Let’s break down the process of management into three key aspects:

1. A Social Process

Management is inherently social, primarily because the human element is paramount among all other factors. In essence, it’s about fostering relationships and interactions among people within an organization. The aim? To make these interactions not only productive but also conducive to achieving the organization’s goals.

Consider it akin to weaving the threads of a tightly knit fabric. Each thread (representing a person or resource) plays a vital role in creating a cohesive whole. Successful management ensures that these threads intertwine harmoniously to support the organization’s mission.

2. An Integrating Process

Think of management as the conductor of an orchestra, skillfully harmonizing different instruments (human, physical, and financial resources) to create a beautiful symphony. Management integrates these varied resources to achieve the organization’s overarching purpose.

Just like a puzzle, where each piece has its unique place and contributes to the whole picture, management aligns resources in a way that each one complements the others. This integration is crucial for the organization’s success, ensuring that all resources work in harmony to attain common goals.

3. A Continuous Process

Management is a marathon, not a sprint. It’s a continuous journey without a finish line. It involves a perpetual cycle of identifying challenges, solving problems, and making necessary adjustments. This process never stops because organizations operate in an ever-changing environment.

Picture it as a ship sailing through uncharted waters. The crew (management) must navigate obstacles and adapt to unforeseen circumstances to reach their destination safely. Similarly, management continually scans the horizon for potential issues and takes proactive steps to steer the organization in the right direction.

Management as an Activity

Management is not just an abstract concept; it’s a concrete activity, much like other actions we perform daily, such as writing, playing, eating, or cooking. At its core, management is about achieving objectives by guiding and coordinating the efforts of others. As Koontz succinctly puts it, “Management is what a manager does.“

Now, let’s delve into the various dimensions of management as an activity:

Informational Activities

In the realm of business, managers are information hubs. They constantly receive and disseminate information, whether through spoken words or written documents. Effective communication is key to the smooth operation of an enterprise. Managers must maintain open lines of communication with both their subordinates and superiors to ensure everyone is on the same page.

Think of it as a conductor in an orchestra, ensuring that each musician knows their part and follows the conductor’s lead. Without this flow of information, the ensemble can’t create harmonious music. Similarly, in a business context, well-maintained communication is essential for a productive and efficient organization.

Decisional Activities

Every aspect of management involves making decisions. Managers are decision-makers, and their choices shape the course of action for their teams and the organization as a whole. These decisions vary in scope and impact, from strategic choices that set the direction for the entire company to tactical decisions that guide daily operations.

Imagine a sales manager determining the advertising strategy, including the choice of media and content. This decision, in turn, affects how other managers must allocate resources and adjust their plans. In essence, management is a continuous stream of decisions, each building upon the decisions of others.

Inter-Personal Activities

At its heart, management is about people. Managers lead and achieve goals through individuals. This requires them to interact with superiors and subordinates alike. Building and maintaining positive relationships is crucial.

Think of managers as navigators steering a ship through both calm and turbulent waters. They must not only guide the vessel but also ensure that the crew (subordinates) works together effectively. This might involve addressing issues and concerns, such as determining bonuses for subordinates, to keep morale high and operations smooth.

Management as a Discipline

In essence, management as a discipline establishes a set of guidelines that managers should adhere to. It outlines a code of conduct that helps them navigate the complexities of leadership and decision-making. Additionally, it presents a toolkit of methods and strategies for efficiently managing an enterprise.

Consider it as a road map for managers, showing them the path to effective leadership and resource management.

Formal Education in Management

Management isn’t just theoretical; it’s a practical field of study. Today, you can formally learn about management in institutes and universities. By completing a prescribed course or obtaining a degree or diploma in management, individuals can prepare themselves for managerial roles.

This education equips future managers with the knowledge and skills needed to excel in their roles. It’s akin to providing them with a toolbox filled with instruments for tackling real-world challenges.

Qualifying as a Discipline

For any field of knowledge to be recognized as a discipline, it must meet specific criteria:

Scholarly Foundations: There should be scholars and thinkers who contribute valuable insights through research and publications. In the case of management, there is a growing body of knowledge, with experts continually exploring new ideas and practices.
Formal Education and Training: The knowledge should be formally imparted through educational and training programs. Management fulfills this requirement by offering structured courses and degree programs, making it accessible to aspiring managers.

A Growing Discipline

While management is relatively young as a discipline, it’s advancing rapidly. As businesses evolve and the global landscape changes, the need for effective management becomes increasingly apparent. Consequently, management as a discipline continues to expand and adapt to meet these evolving demands.

Management as a Group

Management as a group refers to the collective effort of individuals who take on the task of steering an enterprise towards its objectives. When we praise the management of a company like ABC & Co., we are acknowledging the contributions of a team of individuals responsible for its operations.

When we discuss management as a group, we are talking about all the managers involved, from the top executives down to the first-line supervisors. However, in common practice, the term “management” often specifically pertains to the upper echelon of leaders, such as the Chief Executive, Chairman, General Manager, and members of the Board of Directors.

In other words, these are the individuals entrusted with significant decision-making authority. They have the power to allocate resources effectively to achieve the organization’s objectives and are also accountable for ensuring these resources are utilized efficiently.

Two Perspectives on Management as a Group

Management as a group can be viewed in two distinct ways:

All Managers Taken Together: This perspective considers the collective effort of every manager within an organization, regardless of their level or specific role. It recognizes that effective management requires contributions from individuals at all levels.
Only the Top Management: Alternatively, management as a group can focus solely on the top-tier executives who hold the highest positions in the organization. These leaders play a pivotal role in shaping the company’s direction and strategy.

The interpretation of “management as a group” depends on the context in which it is used. It’s important to note that within the realm of management, we encounter different types of managers:

Patrimonial/Family Managers: These individuals assume managerial roles by virtue of being owners or relatives of the company’s owners.
Professional Managers: They are appointed based on their specialized knowledge and qualifications.
Political Managers/Civil Servants: These managers oversee public sector undertakings.

In contemporary society, managers occupy a unique and esteemed position. They belong to an elite group because they not only play a crucial role in an organization’s success but also enjoy a higher standard of living within society. Their decisions impact not only the enterprise but also the livelihoods of the people it employs and the broader community it serves.

Management as a Science

Management as a science is akin to peering into the intricate workings of a well-oiled machine. Just as science delves into specific fields of study to explain phenomena, management uncovers fundamental truths about organizing and leading people effectively. Let’s explore the science of management and its unique characteristics.

The Scientific Essence

At its core, science is a structured body of knowledge that seeks to understand specific subjects. It deals in general facts that explain the natural world. Science excels in establishing cause-and-effect relationships among variables, revealing the underlying principles governing these connections. This understanding is attained through systematic observation and rigorous testing, adhering to the scientific method.

Science is characterized by several key features, including:

Universally Acceptable Principles: Scientific principles embody fundamental truths applicable across various situations and settings. For example, Newton’s law of gravitation holds true regardless of location or time. Similarly, management principles offer universal insights, such as the Principle of Unity of Command, which asserts that each individual should have one direct supervisor. This principle applies universally, whether in business or other organizations.
Experimentation and Observation: Scientific principles are rooted in logical inquiry, derived from thorough investigation and research. For instance, the heliocentric model, where Earth orbits the sun, is scientifically validated. Management principles, too, are grounded in empirical observations and experiments conducted by numerous managers. For instance, fair compensation is observed to contribute to a contented workforce.
Cause-and-Effect Relationships: Science excels in establishing the causal links between various variables. For example, heating metals causes them to expand. Likewise, management identifies cause-and-effect relationships. For instance, a lack of balance between authority and responsibility leads to ineffectiveness. Treating workers fairly results in increased productivity.
Test of Validity and Predictability: Scientific principles are subject to rigorous testing, standing the test of time and providing consistent results. Furthermore, these principles enable the prediction of future events with reasonable accuracy. For instance, the chemical reaction of hydrogen (H2) and oxygen (O2) will always yield water (H2O).

Management principles are similarly amenable to validity testing. For instance, the principle of unity of command can be tested by comparing the performance of an individual with a single supervisor to one with two supervisors, with the former typically performing better.

However, it’s important to acknowledge that management science, while systematic and structured, differs from traditional physical sciences like biology, physics, and chemistry. The main reason for this distinction lies in the complex and unpredictable nature of human behavior. Management deals with people, and predicting human behavior with precision is exceptionally challenging.

Management, as a social science, falls into the realm of social sciences. It’s a flexible science, producing different outcomes in different contexts and times. Ernest Dale aptly characterizes it as a “Soft Science.”

Ernest Dale’s characterization of management as a “Soft Science” reflects the idea that management, while possessing scientific elements, exhibits a degree of subjectivity and flexibility that distinguishes it from traditional “Hard Sciences” like physics or chemistry.

Here’s an elaboration of why management is often referred to as a “Soft Science”:

Human-Centric Nature: Management deals primarily with human beings and their behavior. Unlike in the hard sciences where natural laws govern physical phenomena, human behavior can be highly variable and influenced by emotions, culture, and individual personalities. This variability makes it challenging to apply strict scientific principles and predict outcomes with absolute certainty.
Subjective Decision-Making: While management incorporates scientific principles, many decisions managers make involve subjective judgment calls. For example, when resolving conflicts among team members or determining the most effective leadership style for a particular situation, there may not be a one-size-fits-all answer. This subjectivity contrasts with the objective, quantifiable nature of many hard sciences.
Context Dependency: Management practices often depend on the specific context of an organization, its culture, industry, and the evolving external environment. What works well in one organization or situation may not be equally effective in another. This context dependency introduces an element of unpredictability and adaptability not typically seen in hard sciences.
Interdisciplinary Nature: Management draws from various disciplines, including psychology, sociology, economics, and organizational behavior. This interdisciplinary approach contributes to the “soft” aspect of management as it integrates insights from multiple fields, making it less rigid and more adaptable to different scenarios.
Ever-Evolving Dynamics: Organizations and the business world continually change and adapt to new challenges and opportunities. Management principles must evolve alongside these dynamics. This adaptability and the need for constant adjustment are hallmarks of a “soft” science.

Management as an Art

Management as an art is akin to the deft strokes of a painter or the harmonious notes of a musician.

It involves the application of knowledge and skills to achieve desired outcomes. In essence, it’s the personalized use of general theoretical principles to attain the best possible results.

Let’s delve into the artistry of management.

Artistic Characteristics

Art, whether in painting or management, exhibits several key characteristics:

Practical Knowledge: Art demands practical knowledge. Merely grasping theory isn’t enough. For instance, a good painter doesn’t just know about colors and brushes but also understands how to use them in various designs and situations. Similarly, a successful manager can’t rely solely on a management degree; they must apply principles in real-world managerial roles.
Personal Skill: Every artist, whether a painter or a manager, infuses their work with a personal touch. Each individual has their style and approach. This uniqueness influences the level of success and quality of performance. Just as renowned painters have distinctive styles, effective managers employ their own methods based on knowledge, experience, and personality.
Creativity: Artists thrive on creativity, aiming to produce something unique. This requires a blend of intelligence and imagination. Management is no different; it’s inherently creative. Managers combine human and non-human resources in innovative ways to achieve desired results, much like composing music by harmonizing chords.
Perfection through Practice: The path to mastery is paved with practice. Every artist hones their skills through continuous effort. Similarly, managers learn through trial and error, gradually perfecting their craft by applying management principles over the years.
Goal-Oriented: Art, in all its forms, is result-oriented, striving to achieve tangible outcomes. Management shares this trait, as it is directed toward accomplishing predetermined goals. Managers harness various resources—people, finances, materials, machinery, and methods—to propel organizational growth.

Management as an Art and a Science

Now, it’s crucial to recognize that management is both an art and a science. Let’s unravel this duality:

Management as a Science: It embodies an organized body of knowledge with universal truths. Management principles, akin to scientific laws, provide a systematic framework for understanding and improving organizational performance.
Management as an Art: It requires the application of knowledge and skills in practice. Managers use their unique approaches and styles to address real-world challenges. Just as a singer combines knowledge of ragas with personal skill, managers blend their understanding of principles with their artistry in problem-solving.

In short, science equips us with knowledge, while art imparts the ability to apply that knowledge effectively.

They are not mutually exclusive but rather complementary, much like the pairing of tea and biscuits or bread and butter.

The old notion that “Managers are Born” has given way to the belief that “Managers are Made.”

Management is often described as the oldest of arts and the youngest of sciences.

To summarize, science provides the foundation, and art brings it to life—the root and the fruit of management’s success story.

Management as a Profession

Management as a profession has undergone significant transformations in recent decades. Factors like the expanding size of business entities, the separation of ownership and management, and intensifying competition have fueled a growing demand for managers with professional qualifications.

The role of a manager has become increasingly specialized, leading to the professionalization of management. Let’s explore the journey of management as a profession.

What is a Profession?

A profession can be defined as an occupation that necessitates specialized knowledge and rigorous academic preparation, with entry into the field regulated by a governing body. Several essential attributes define a profession:

Specialized Knowledge: A profession must possess a structured body of knowledge that serves as the foundation for professional development. Professionals are expected to actively acquire expertise in the principles and techniques of their field. Similarly, managers must dedicate themselves to mastering the science of management.
Formal Education and Training: Professions typically require individuals to complete prescribed courses and training programs offered by institutes and universities. For example, becoming a Certified Public Accountant (CPA) necessitates specific educational qualifications. While there are management institutes and MBA programs, there is no legal requirement for managers to hold specific qualifications.
Social Obligations: Professionals are driven not only by livelihood but also by a sense of duty to society. Their actions are guided by societal norms and values. Likewise, managers have responsibilities not only to their organizations but also to society. They are expected to provide quality products or services at reasonable prices.
Code of Conduct: Professions enforce a code of conduct comprising rules, regulations, and ethical standards. This code is overseen by a representative association, ensuring self-discipline among members. Violating the code can lead to penalties and even expulsion. While management has a code of conduct established by organizations like the All India Management Association (AIMA), it lacks legal authority to enforce it.
Representative Association: A representative body is essential for regulating a profession. These bodies establish and maintain competence standards and oversee professional conduct. For example, the Institute of Chartered Accountants of India regulates auditors. However, management lacks a centralized body with statutory powers to regulate managerial activities.

Despite these resemblances to a profession, management falls short in some key aspects:

No Entry Restrictions: There are no stringent entry restrictions into managerial positions based on specific qualifications or standards.
Lack of Minimum Qualifications: Unlike many professions, there are no minimum educational qualifications mandated for managers.
Absence of Certificate of Practice: Management associations do not possess the authority to grant a certificate of practice to managers.
Limited Education and Training Facilities: Competent education and training facilities for management are not universally accessible.
Multiple Responsibilities: Managers have obligations to various stakeholders, including shareholders, employees, and society, which may conflict with a strict regulatory code.
Performance vs. Degrees: In management, success is often measured by performance rather than degrees or qualifications.

In nutshell, while management exhibits several characteristics of a profession, it is not considered a full-fledged one.

The evolving landscape of management emphasizes the balance between serving society and achieving profitability.

The path to professionalism continues to shape the role of managers, ultimately guided by the principle that those who serve best also profit most.