The nature of Management
Management is multidisciplinary because it includes knowledge/information from various disciplines- economics, statistics, maths, psychology, sociology, ecology, operations research, history, etc. Management integrates the ideas and concepts taken from these disciplines and presents newer concepts which can be put into practice for managing the organizations.
Management is dynamic: Management has framed certain principles, which are flexible in nature and change with the changes in the environment in which an organization exits.
Key dimensions of the discipline of Management
Planning: planning can become a management process, concerned with defining goals for a future direction and determining on the missions and resources to achieve those targets. To meet the goals
Organising: 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.
Leading: Leading involves the social and informal sources of influence that you use to inspire action taken by others. If managers are effective leaders, their subordinates will be enthusiastic about exerting effort to attain organizational objectives.
Controlling: Controlling involves ensuring that performance does not deviate from standards. Controlling consists of three steps, which include (1) establishing performance standards, (2) comparing actual performance against standards, and (3) 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 quality or customer service
Directing: process in which the managers instruct, guide and oversee the performance of the workers to achieve predetermined goals. Directing is said to be the heart of management process. Planning, organizing, staffing has got no importance if direction function does not take place
Staffing: staffing involves manning the organization structure through proper and effective selection, appraisal and development of the personnel to fill the roles assigned to the employers/workforce.
Management theory originated with “scientific” and “bureaucratic” management that used measurement, procedures and routines as the basis for operations. Organizations developed hierarchies to apply standardized rules to the workplace and punished workers for not following them. With the “human relations” movement, companies started emphasizing individual workers. Contemporary management theories, including system theory, contingency theory and chaos theory, focus on the whole organization, with employees as a key part of the system.
Management theories have evolved to acknowledge that corporate culture can be a contributor to performance. If you can develop a sense of belonging to a group for your company, you can manage the business for improved financial performance and return on investment. To work well with a positive corporate culture as a manager, you must work through the culture and not try to control it. A positive corporate culture takes care of a lot of informal exchange of information and behavioral norms.
All contemporary management theories emphasize measurement and quantitative analysis. Management has evolved to focus on fundamental company operating results and business variables that are relevant, specific to goals and quantifiable. Information technology allows you to analyse large data sets and extract trends. You can evaluate key performance indicators, which track data affecting your objectives, to tell you how well you are advancing toward your goals. You can perform these evaluations independently of the management style and organizational structure of the company.
Management theories have evolved into two competing orientations. Theory X assumes employees don’t want to work and act out of self-interest. Managers have to put in place a disciplinary structure to guide employees in the execution of their work. If you function with theory X, you have to tell employees what to do and encourage them to do it.
Theory Y assumes employees want to carry out interesting and rewarding work and seek reward in the achievement. Managers must set goals and allow employees to find creative ways to reach them. If your company culture is in line with theory Y, you facilitate employee effort and act more like a coach.
Having a clear strategic direction and strategic plan with a focused implementation process in place is important. Business success isn’t going to happen by accident. You must look into the future and create a plan for wherever you’re trying to go.
What will your business be like in three years? Do you have a road map to get from today to your envisioned tomorrow? Will you be a few steps closer to realizing your vision by next year? No one can predict the future. But if you don’t change anything, the future won’t be any different than the past.
One sure-fire way to impact your company’s future (and profitability) is to dust off a timeless tool — the strategic plan — and intentionally drive your organization forward. No one strategic model fits all organizations, but the planning process includes certain basic elements that all businesses can use to explore their vision, goals, and next steps of an effective strategic plan. A good strategic plan achieves the following:
Reflects the values of the organization
Inspires action to achieve a big future
Explains how you’ll win in the market
Clearly defines the criteria for achieving success
Guides everyone in daily decision making
Effective leaders aren’t sitting around waiting for something to happen. They’re anticipating what lies ahead. Managers and business owners aren’t waiting for their competitors to swoop in and put them out of business. Instead, they’re using their strategic plans to get ahead of the game.
So, the fact that many people avoid strategic planning because they consider it complex, costly, and time-intensive is just odd. Most of the time, businesses shelve the plan before it can be implemented, even knowing that some other company may invade their market.
Decision making is crucial for running a business enterprise which faces a large number of problems requiring decisions.
Which product to be produced, what price to be charged, what quantity of the product to be produced, what and how much advertisement expenditure to be made to promote the sales, how much investment expenditure to be incurred are some of the problems which require decisions to be made by managers.
The five steps involved in managerial decision-making process are explained below:
1. Establishing the Objective:
The first step in the decision-making process is to establish the objective of the business enterprise. The important objective of a private business enterprise is to maximise profits. However, a business firm may have some other objectives such as maximisation of sales or growth of the firm.
But the objective of a public enterprise is normally not of maximisation of profits but to follow benefit-cost criterion. According to this criterion, a public enterprise should evaluate all social costs and benefits when deciding whether to build an airport, a power plant, a steel plant, etc.
2. Defining the Problem:
The second step-in decision-making process is one of defining or identifying the problem. Defining the nature of the problem is important because decision making is after all meant for solution of the problem. For instance, a cotton textile firm may find that its profits are declining.
It needs to be investigated what are the causes of the problem of decreasing profits. Whether it is the wrong pricing policy, bad labour-management relations or the use of outdated technology which is causing the problem of declining profits. Once the source or reason for falling profits has been found, the problem has been identified and defined.
3. Identifying Possible Alternative Solutions (i.e. Alternative Courses of Action):
Once the problem has been identified, the next step is to find out alternative solutions to the problem. This will require considering the variables that have an impact on the problem. In this way, relationship among the variables and with the problems must be established.
Regarding this, various hypotheses can be developed which will become alternative courses for the solution of the problem. For example, in case of the problem mentioned above, if it is identified that the problem of declining profits is due to be use of technologically inefficient and outdated machinery in production.
The two possible solutions of the problem are:
(1) Updating and replacing only the old machinery.
(2) Building entirely a new plant equipped with latest machinery.
The choice between these alternative courses of action depends on which will bring about larger increase in profits.
4. Evaluating Alternative Courses of Action:
The next step in business decision making is to evaluate the alternative courses of action. This requires, the collection and analysis of the relevant data. Some data will be available within the various departments of the firm itself, the other may be obtained from the industry and government.
The data and information so obtained can be used to evaluate the outcome or results expected from each possible course of action. Methods such as regression analysis, differential calculus, linear programming, cost- benefit analysis are used to arrive at the optimal course. The optimum solution will be one that helps to achieve the established objective of the firm. The course of action which is optimum will be chosen. It may be further noted that for the choice of an optimal solution to the problem, a manager works under certain constraints.
The constraints may be legal such as laws regarding pollution and disposal of harmful wastes; the way be financial (i.e. limited financial resources); they may relate to the availability of physical infrastructure and raw materials, and they may be technological in nature which set limits to the possible output to be produced per unit of time. The crucial role of a business manager is to determine optimal course of action and he must make a decision under these constraints.
5. Implementing the Decision:
After the alternative courses of action have been evaluated and optimal course of action selected, the final step is to implement the decision. The implementation of the decision requires constant monitoring so that expected results from the optimal course of action are obtained. Thus, if it is found that expected results are not forthcoming due to the wrong implementation of the decision, then corrective measures should be taken.
Information, as we know it today, includes both electronic and physical information. The organizational structure must be capable of managing this information throughout the information lifecycle regardless of source or format (data, paper documents, electronic documents, audio, video, for delivery through multiple channels that may include cell phones and web interfaces.
Information management (IM) is the collection and management of information from one or more sources and the distribution of that information to one or more audiences. This sometimes involves those who have a stake in, or a right to that information. Management means the organization of and control over the structure, processing and delivery of information.
AIIM agrees with this definition. Information, as we know it today, includes both electronic and physical information. The organizational structure must be capable of managing this information throughout the information lifecycle regardless of source or format (data, paper documents, electronic documents, audio, social business, video, etc.) for delivery through multiple channels that may include cell phones and web interfaces. Given these criteria, we can then say that the focus of IM is the ability of organizations to capture, manage, preserve, store and deliver the right information to the right people at the right time.
Information management environments are comprised of legacy information resident in line of business applications, Enterprise Content Management (ECM), Electronic Records Management (ERM), Business Process Management (BPM), Taxonomy and Metadata, Knowledge Management (KM), Web Content Management (WCM), Document Management (DM) and Social Media Governance technology solutions and best practices. Information management requires the adoption and adherence to guiding principles that include:
Information assets are corporate assets. This principle should be acknowledged or agreed upon across the organization otherwise any business case and support for IM will be weak.
Information must be made available and shared. Of course, not all information is open to anyone, but in principle the sharing of information helps the use and exploitation of corporate knowledge.
Information the organization needs to keep is managed and retained corporately. In other words, the retention and archiving, of information. If you save a document today, you expect it to be secured and still available to you tomorrow.
Information management is a corporate responsibility that needs to be addressed and followed from the upper most senior levels of management to the front line worker. Organizations must be held and must hold its employees accountable to capture, manage, store, share, preserve and deliver information appropriately and responsibly. Part of that responsibility lies in training the organization to become familiar with the policies, processes, technologies and best practices in IM. That training is available through AIIM.