Ir Haery SihombingIP Pensyarah Pelawat Fakulti Kejuruteraan Pembuatan

Ir. Haery Sihombing/IP Pensyarah Pelawat Fakulti Kejuruteraan Pembuatan Universiti Teknologi Malaysia Melaka 7 INDUSTRIAL MANAGEMENT & COST Some parts of these presentation are taken from Chapter-1

MANAGEMENT n n n Technique, practice or science of managing or controlling; the skillful use of resources and time; the specific treatment of a disease or disorder. Function that organizes the execution of today’s business. The process of getting activities completed efficiently and effectively with and through other people. Traditionally, the term "management" refers to the set of activities, and often the group of people, involved in four general functions, including planning, organizing, leading and coordinating activities. (Note that the four functions recur throughout the organization and are highly integrated. )

MANAGEMENT Some writers, teachers and practitioners assert that the previous view is rather outmoded and that management needs to focus more on leadership skills, e. g. , establishing vision and goals, communicating the vision and goals, and guiding others to accomplish them. They also assert that leadership must be more facilitative, participative and empowering in how visions and goals are established and carried out. Some people assert that this really isn't a change in the management functions, rather it's re-emphasizing certain aspects of management.

Definition of Management n n The attainment of organizational goals in an effective and efficient manner through Four functions n n planning, organizing, leading, and controlling organizational resources. Managers use a multitude of skills to perform functions

MANAGEMENT Management functions: q Planning q Organizing q Staffing q Directing q Coordinating q Reporting q Budgeting The people who administer a company, create policies, and provide the support necessary to implement the owners' business objectives.

MANAGEMENT Management roles: Ø Interpersonal roles Figurehead, Leader, Liaison Ø Informational roles: Monitor, Disseminator, Spokesperson Ø Decisional roles Entrepreneur, Disturbance handler, Resource allocator, Negotiator

What Is Management? n Management n the process of coordinating work activities so that they are completed efficiently and effectively with and through other people n elements of definition n Process - represents ongoing functions or primary activities engaged in by managers n Coordinating - distinguishes a managerial position from a non-managerial one

What is Management? n (cont. ) Management (cont. ) n Efficiency - getting the most output from the least amount of inputs n “doing things right” n concerned with means n Effectiveness - completing activities so that organizational goals are attained n “doing the right things” n concerned with ends

Efficiency and Effectiveness in Management Efficiency (Means) Effectiveness (Ends) Resource Usage Goal Attainment Low Waste High Attainment Management Strives For: Low resource waste (high efficiency) High goal attainment (high effectiveness)

UNIVERSAL NEED FOR MANAGEMENT 1 -10

INDUSTRIAL REVOLUTION

INDUSTRIAL REVOLUTION The major inventions of the Industrial Revolution – American - British and European – the Industrial Revolution defined was the widespread replacement of manual labor by new inventions or machinery. Industrial Revolution, widespread replacement of manual labor by machines that began in Britain in the 18 th century and is still continuing in some parts of the world. The Industrial Revolution was the result of many fundamental, interrelated changes that transformed agricultural economies into industrial ones. The most immediate changes were in the nature of production: what was produced, as well as where and how.

INDUSTRIAL REVOLUTION n 1712 - Newcomen Steam Engine and the Industrial Revolution In 1712, Thomas Newcomen together with John Calley built their first steam engine on top of a water filled mine shaft and used it to pump water out of the mine. The Newcomen steam engine was the predecessor to the Watt steam engine and it was one of the most interesting pieces of technology developed during the 1700's. The invention of engines, the first being steam engines, was very important to the industrial revolution.

INDUSTRIAL REVOLUTION 1733 – Flying Shuttle, Automation of Textile Making & The Industrial Revolution In 1733, John Kay invented the flying shuttle, an improvement to looms that enabled weavers to weave faster. By using a flying shuttle, a single weaver could produce a wide piece of cloth. The original shuttle contained a bobbin on to which the weft (weaving term for the crossways yarn) yarn was wound. It was normally pushed from one side of the warp (weaving term for the series of yarns that extended lengthways in a loom) to the other side by hand. Before the flying shuttle wide looms needed two or more weavers to throw the shuttle.

INDUSTRIAL REVOLUTION 1764 - Increased Yarn & Thread Production During Industrial Revolution In 1764, a British carpenter and weaver named James Hargreaves invented an improved spinning jenny, a hand-powered multiple spinning machine that was the first machine to improve upon the spinning wheel by making it possible to spin more than one ball of yarn or thread. {p] Spinner machines like the spinning wheel and the spinning jenny made threads and yarns used by weavers in their looms. As weaving looms became faster, inventors had to find ways for spinners to keep up.

INDUSTRIAL REVOLUTION 1769 - James Watt's Improved Steam Engine Powers the Industrial Revolution James Watt was sent a Newcomen steam engine to repair that led him to invented improvements for steam engines. Steam engines were now true reciprocating engine and not atmospheric engines. Watt added a crank and flywheel to his engine so that it could provide rotary motion. Watt's steam engine machine was four times more powerful than those engines based on Thomas Newcomen's steam engine design

INDUSTRIAL REVOLUTION 1769 - Spinning Frame or Water Frame Richard Arkwright patented the spinning frame or water that could produce stronger threads for yarns. The first models were powered by waterwheels so the device came to be first known as the water frame. It was the first powered, automatic, and continuous textile machine and enabled the move away from small home manufacturing towards factory production of textiles. The water frame was also the first machine that could spin cotton threads.

INDUSTRIAL REVOLUTION 1779 Spinning Mule Increased Variety in Threads & Yarns In 1779, Samuel Crompton invented the spinning mule that combined the moving carriage of the spinning jenny with the rollers of the water frame. The spinning mule gave the spinner great control over the weaving process. Spinners could now make many different types of yarn. Finer cloths could now be made.

INDUSTRIAL REVOLUTION 1785 - Power Loom's Effect on the Women of the Industrial Revolution The power loom was a steam-powered, mechanically-operated version of a regular loom. A loom is a device that combined threads to make cloth. When the power loom became efficient, women replaced most men as weavers in the textile factories

INDUSTRIAL REVOLUTION Ø IMPACT RESULTED (POSITIVE) n The social changes brought about by the Industrial Revolution were significant. n As economic activities in many communities moved from agriculture to manufacturing, production shifted from its traditional locations in the home and the small workshop to factories. n Large portions of the population relocated from the countryside to the towns and cities where manufacturing centers were found. n The overall amount of goods and services produced expanded dramatically, and the proportion of capital invested per worker grew.

INDUSTRIAL REVOLUTION Ø IMPACT RESULTED (POSITIVE) n New groups of investors, businesspeople, and managers took financial risks and reaped great rewards. n In the long run the Industrial Revolution has brought economic improvement for most people in industrialized societies. n Many enjoy greater prosperity and improved health, especially those in the middle and the upper classes of society.

INDUSTRIAL REVOLUTION Ø IMPACT RESULTED (NEGATIVE) n There have been costs, however. n In some cases, the lower classes of society have suffered economically. n Industrialization has brought factory pollutants and greater land use, which have harmed the natural environment. n In particular, the application of machinery and science to agriculture has led to greater land use and, therefore, extensive loss of habitat for animals and plants. n In addition, drastic population growth following industrialization has contributed to the decline of natural habitats and resources. These factors, in turn, have caused many species to become extinct or endangered.

Changes in Industry n Continuous-Process Manufacturing An important American development was continuousprocess manufacturing. In continuous-process manufacturing, large quantities of the same product, such as cigarettes or canned food, are made in a nonstop operation. The process runs continuously, except for repairs to or maintenance of the machinery used. Continuous-Process Manufacturing In the late 18 th century, inventor Oliver Evans of Delaware created a remarkable waterpowered flour mill. In Evans’s mill, machinery elevated the grain to the top of the mill and then moved it mechanically through various processing steps, eventually producing flour at the bottom of the mill. The process greatly reduced the need for manual labor and cut milling costs dramatically. Mills modeled after Evans’s were built along the Delaware and Brandywine rivers and Chesapeake Bay, and by the time of the American Revolution (1775 -1783) they were arguably the most productive in the world. Similar milling technology was also used to grind snuff and other tobacco products in the same region.

Changes in Industry n The American System by the mid-19 th century American manufacturers shaped a set of techniques later known as the American system of production. n This system involved using special-purpose machines to produce large quantities of similar, sometimes interchangeable, parts that would then be assembled into a finished product. n The American system extended the idea of division of labor from workers to specialized machines. Instead of a worker making a small part of a finished product, a machine made the part, speeding the process and allowing manufacturers to produce goods more quickly. n This method also enabled goods of much more uniform quality than those made by hand labor.

Changes in Industry n The Second Industrial Revolution As American manufacturing technology spread to new industries 1. The first had come on a wave of new inventions in iron making, in textiles, in the centrally powered factory, and in new ways of organizing business and work. 2. In the latter 19 th century, a second wave of technical and organizational advances carried industrial society to new levels. While Great Britain had been the birthplace of the first revolution, the second occurred most powerfully in the United States.

Changes in Industry n FORDIANISM n It was in the automobile industry that continuous-process methods and the American system combined to greatest effect. In 1903 American industrialist Henry Ford founded the Ford Motor Company. His production innovation was the moving assembly line which brought together many mass-produced parts to create automobiles. Ford’s moving assembly line gave the world the fullest expression yet of the Second Industrial Revolution, and his production triumphs in the second decade of the 20 th century signaled the crest of the new industrial age. n n n

Changes in Industry n Organization and Work-Taylorism n Just as important as advances in manufacturing technology was a wave of changes in how business was structured and work was organized. n Engineers studied and modified production, seeking the most efficient ways to lay out a factory, move materials, route jobs, and control work through precise scheduling. Industrial engineer Frederick Taylor and his followers sought both efficiency and contented workers. They believed that they could achieve those results through precise measurement and analysis of each aspect of a job. n

INDUSTRIAL PROGRESS & ISSUES

Managing in Turbulent Times

1. Organizational Change Pace continues to accelerate n Change is major source of business risk n n Driving Forces n n n Telecommunications Diversity of Workers Public consciousness Global marketplace Community of stakeholders

A. Driving Force: Technology Ever-advancing Technology has shrunk the world

B. Driving Force: Diversity Increasing diversity of workers has brought in a wide array of differing values, perspectives, and expectations among workers

C. Driving Force: Public Consciousness Public consciousness has become much more sensitive and demanding that organizations be more socially responsible

D. Driving Force: Global Marketplace Strive to remain competitive in the face of increasingly tough global competition Much of the 3 rd-world countries have joined the global marketplace, creating a wider arena for sales and services

E. Driving Force: Stakeholders n n n Community of Stakeholders Organizations are responsible to stockholders, and Focus on building relationships with employees, customers, partners, and suppliers

2. Nature of Management n Cope with diverse, far-reaching challenges n Driving Forces n Telecommunications n Diversity of Workers n Public consciousness n Global marketplace n Community of stakeholders

A. Shift in Mindsets to Navigate Turbulence Managers are asked to. . . n Do more with less n Engage whole employees n See change rather than stability as natural n Create vision and cultural values that encourage collaborative workplace

B. Making a Difference Today Requires integrating. . . n Tried and true management skills + n New approaches that emphasize n Human touch n Enhance flexibility n Involve employees’ hearts, minds, and bodies Successful organizations don’t just happen. . . they are managed to be that way!

3. Functions of Management Planning Select goals and ways to attain them Organizing Controlling Monitor activities and make corrections Assign responsibility for task accomplishment Leading Use influence to motivate employees

A. The Process of Management Planning Select goals and ways to attain them Resources • Human • Financial • Raw Materials • Technological Performance • Attain goals Organizing Controlling Monitor activities and make corrections Assign responsibility for task accomplishment • Information Leading Use influence to motivate employees • Products • Services • Efficiency • Effectiveness

Planning Function n Definition n Defines goals for future organizational performance n Decides tasks and use of resources needed n Corporate Examples n Planning – AOL Time Warner – The Lord of the Rings p. 8 n Lack of planning – Merry-Go-Round – p. 8

Organizing Function n Definition n Follows planning Reflects how organization tries to accomplish plan Involves assignment of tasks into departments n authority and allocation of resources across organization n n Corporate Examples - Structural reorganizations n n Hewlett-Packard, Sears, Xerox: accommodate changing plans Voyant Technologies: increased sales; faster product development

Controlling Function Definition ● Monitoring employees’ activities ● Determining whether the organization is on target toward its goals ● Making corrections as necessary

Controlling Function New Trends n n Empowerment and trust of employees = training employees to monitor and correct themselves New information technology provides control without strict top-down constraints Lack of Control Information can lead to Organizational Failure

B. Organizational Performance Attainment of organizational goals in an efficient and effective manner The Process of Management

Organizational Performance n Organization - social entity that is goal directed and deliberately structured n Effectiveness - degree to which organization achieves a stated goal n Efficiency - use of minimal resources (raw materials, money, and people) to produce the desired volume of output n Performance – organization’s ability to attain its goals by using resources in an efficient and effective manner

4. Management Skills Manager’s Job • Complex • Multidimensional • Range of skills

Management Skills n Conceptual Skills – Cognitive ability to see the organization as a whole and the relationships among its parts n Human Skills – ability to work with and through n Technical Skills – understanding of and proficiency n When skills Fail other people and to work effectively as a group member in the performance of specific tasks

A. Management Types - Vertical Managerial Levels in the Organizational Hierarchy Levels. Hierarchy in the Managerial. Management Levels in the Organizational Hierarchy

B. Management Types - Horizontal n Functional Managers n Responsible for a department that performs a single functional task and n Has employees with similar training and skills n General Managers n Responsible for several departments that perform different functions

Managerial Types - Horizontal n Functional Managers n n n Advertising Sales Finance Human Resources Manufacturing Accounting n General Managers n Self-contained division such as a Dillard’s department store n Project managers have general management responsibility as they coordinate people across several departments

C. What is it like to be a Manager? n Manager Activities n Multitasking Fragmentation n Life n Variety Brevity on Speed Dial Manager’s Role n n Set of expectations for one’s behavior Diverse activities 3 roles

Who Are Managers? n Manager n someone who works with and through other people by coordinating their work activities in order to accomplish organizational goals n changing nature of organizations and work has blurred the clear lines of distinction between managers and nonmanagerial employees

Classifying Managers n First-line Managers n n Middle Managers n n Individuals who manage the work of non-managerial employees. Individuals who manage the work of first-line managers. Top Managers n Individuals who are responsible for making organization-wide decisions and establishing plans and goals that affect the entire organization.

Classifying Managers

Manager Roles Category Informational Role Monitor Disseminator Spokesperson Interpersonal Figurehead Leader Liaison Decisional Entrepreneur Disturbance handler Resource allocator negotiator

What Do Managers Do? 1. Functional Approach n Planning n n Organizing n n Arranging and structuring work to accomplish organizational goals. Leading n n Defining goals, establishing strategies to achieve goals, developing plans to integrate and coordinate activities. Working with and through people to accomplish goals. Controlling n Monitoring, comparing, and correcting work.

What Managers Actually Do (Mintzberg) n Interaction n with others with the organization n with the external context of the organization n n Reflection n n thoughtful thinking Action n practical doing

What Do Managers Do? (cont’d) 2. Skills Approach n Technical skills n n Human skills n n Knowledge and proficiency in a specific field The ability to work well with other people Conceptual skills n The ability to think and conceptualize about abstract and complex situations concerning the organization

Skills Needed at Different Management Levels

Conceptual Skills n Using information to solve business problems n Identifying of opportunities for innovation n Recognizing problem areas and implementing solutions n Selecting critical information from masses of data n Understanding of business uses of technology n Understanding of organization’s business model Source: Based on American Management Association Survey of Managerial Skills and Competencies, March/April 2000, found on AMA Web site (www. ama. org), October 30, 2002.

Communication Skills n Ability to transform ideas into words and actions n Credibility among colleagues, peers, and subordinates n Listening and asking questions n Presentation skills; spoken format n Presentation skills; written and/or graphic formats Source: Based on American Management Association Survey of Managerial Skills and Competencies, March/April 2000, found on AMA Web site (www. ama. org), October 30, 2002.

Effectiveness Skills n Contributing to corporate mission/departmental objectives n Customer focus n Multitasking: working at multiple tasks in parallel n Negotiating skills n Project management n Reviewing operations and implementing improvements Source: Based on American Management Association Survey of Managerial Skills and Competencies, March/April 2000, found on AMA Web site (www. ama. org), October 30, 2002.

Effectiveness Skills (cont’d) n Setting and maintaining performance standards internally and externally n Setting priorities for attention and activity n Time management Source: Based on American Management Association Survey of Managerial Skills and Competencies, March/April 2000, found on AMA Web site (www. ama. org), October 30, 2002.

Interpersonal Skills n Coaching and mentoring skills n Diversity skills: working with diverse people and cultures n Networking within the organization n Networking outside the organization n Working in teams; cooperation and commitment Source: Based on American Management Association Survey of Managerial Skills and Competencies, March/April 2000, found on AMA Web site (www. ama. org), October 30, 2002.

D. Hierarchical Levels

E. Managing in Small Businesses and Nonprofit Organizations n Role Differences n Source of Financial Resources n Unconventional Bottom-line

E 1. Management and the New Workplace Characteristics n Resources = Bits--information n Work = Flexible, virtual n Workers = Empowered employees, free agents Forces on Organizations Management Competencies n Leadership = Dispersed, empowering n Focus = Connection to customers, employees n Doing Work = By teams n Technology = Digital, e-business n Relationships = Collaboration n Markets = Global, including internet n n Workforce = Diverse Design = Experimentation, learning organization n Values = Change, speed n Events = Turbulent, more frequent crises

E 1. Management and the New Workplace Forces on organizations n New Management Competencies n n Dispersed leadership n Empowering others n Collaborative relationships n Team-building skills n Learning organization

E 2. Managing During Turbulent Times Stay Calm n Be Visible n Put People Before Business n Tell the Truth n Know When to Get Back to Business n

PERSPECTIVE: As An Example of Current Industrial

Stages of Economic Development Features Society Game Pre. Against Industrial Nature Pre. Use of dominant human Unit of Standard of living activity Agriculture Mining labor social life measure Structure Raw muscle power Extended household Subsistence Routine Simple hand Traditional tools Authoritative Industrial Against Goods fabricated production nature Machine Individual tending Quantity of goods Postindustrial Artistic Community Creative Intellectual Quality of life in terms of health, education, recreation Among Persons Services Technology Bureaucratic Machines Hierarchical Interdependent Global Information

Faster Growth and More Good Jobs Once an economy reaches the middle income level of development, service industries become a more important source of job growth than manufacturing

Trends in U. S. Employment by Sector

Percent Service Employment for Selected Industrialized Nations Country United States Canada Japan France Israel Italy China 1980 1987 1993 1999 67. 1 67. 2 54. 5 56. 9 63. 3 48. 7 13. 1 71. 0 70. 8 58. 8 63. 6 66. 0 57. 7 17. 8 74. 3 74. 8 59. 9 66. 4 68. 0 60. 2 21. 2 80. 4 73. 9 72. 4 70. 8 70. 7 61. 1 26. 4

Faster Growth and More Good Jobs Once an economy reaches the middle income level of development, service industries become a more important source of job growth than manufacturing

Percent of U. S. Labor Force by Industry 80 70 60 50 40 30 20 10 0 1929 1948 1969 1977 1984 1999 Year n Services n Manufacturing n Mining & Agriculture Source: Survey of Current Business, April 1998, Table B. 8, July 1988, Table 6. 6 B, and July 1992, Table 6. 4 C; Eli Ginzberg and George J. Vojta, “The Service Sector of the U. S. Economy, ” Scientific American, 244, 3 (1981): 31 -39.

Percent of U. S. Gross Domestic Product by Industry Percent of GDP 80 70 60 50 40 30 20 10 0 1948 1959 1967 1977 1987 1999 Year Source: Survey of Current Business, August 1996, Table 11, April 1998, Table B. 3; Eli Ginzberg and George J. Vojta, “The Service Sector of the U. S. Economy, ” Scientific American, 244, 3 (1981): 31 -39. n Services n Manufacturing n Mining & Agriculture

PERSPECTIVE: Management as one process and system

EMERGING CHALLENGES FOR MANAGEMENT 1. Globalization: Managers need to think globally and act locally. 2. Technology: The new economy will base on digital revolution. The development in information technology will provide greater access to management. Management will need to manage changing technology effectively. 3. Quality: Quality assurance is getting important. 4. Social responsibility: Management will pursue long term goals that are good for society. 5. Empowerment: To empower worker is a challenge to management.

EMERGING CHALLENGES FOR MANAGEMENT Human resource management: Management needs to deal with diversified work force, requires visionary leadership on the part of management. 7. Organization design: Organization will be lean flat and less hierarchical 8. Cultural sensitivity: Cultural value will change cross cultural influences. Organizations are emerging as cultural systems. 9. Change management: Manager will face the challenge of managing change. They will need to aware specific changes and their likely impact on the practice of management. 10. Learning organization: Management needs to create learning environment. Organization of future will be predominantly knowledge based. 6.

Management can be defined in detail in following categories : 1. 2. 3. 4. 5. 6. 7. Management as a Process Management as an Activity Management as a Discipline Management as a Group Management as a Science Management as an Art Management as a Profession

Management as a Process n 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 cooperated 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:

Management as a Process • 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. 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. 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 as a Activity n Like various other activities performed by human beings such as writing, playing, eating, cooking etc, management is also an activity because a manager is one who accomplishes the objectives by directing the efforts of others. According to Koontz, “Management is what a manager does”. Management as an activity includes –

Management as a Activity n Informational activities – In the functioning of business enterprise, the manager constantly has to receive and give information orally or in written. A communication link has to be maintained with subordinates as well as superiors for effective functioning of an enterprise. n Decisional activities – Practically all types of managerial activities are based on one or the other types of decisions. Therefore, managers are continuously involved in decisions of different kinds since the decision made by one manager becomes the basis of action to be taken by other managers. (E. g. Sales Manager is deciding the media & content of advertising). n Inter-personal activities – Management involves achieving goals through people. Therefore, managers have to interact with superiors as well as the sub-ordinates. They must maintain good relations with them. The inter-personal activities include with the sub-ordinates and taking care of the problem. (E. g. Bonuses to be given to the sub-ordinates).

Management as a Discipline n n Management as a discipline refers to that branch of knowledge which is connected to study of principles & practices of basic administration. It specifies certain code of conduct to be followed by the manager & also various methods for managing resources efficiently. Management as a discipline specifies certain code of conduct for managers & indicates various methods of managing an enterprise. Management is a course of study which is now formally being taught in the institutes and universities after completing a prescribed course or by obtaining degree or diploma in management, a person can get employment as a manager.

Management as a Discipline Any branch of knowledge that fulfils following two requirements is known as discipline: n There must be scholars & thinkers who communicate relevant knowledge through research and publications. n The knowledge should be formally imparted by education and training programmes. Since management satisfies both these problems, therefore it qualifies to be a discipline. Though it is comparatively a new discipline but it is growing at a faster pace

Management as a Group n Management as a group refers to all those persons who perform the task of managing an enterprise. When we say that management of ABC & Co. is good, we are referring to a group of people those who are managing. Thus as a group technically speaking, management will include all managers from chief executive to the first – line managers (lower-level managers). But in common practice management includes only top management i. e. Chief Executive, Chairman, General Manager, Board of Directors etc. In other words, those who are concerned with making important decisions, these persons enjoy the authorities to use resources to accomplish organizational objectives & also responsibility to for their efficient utilization.

Management as a Group Management as a group may be looked upon in 2 different ways: n n All managers taken together. Only the top management The interpretation depends upon the context in which these terms are used. Broadly speaking, there are 3 types of managers – n n n Patrimonial / Family Manager: Those who have become managers by virtue of their being owners or relatives of the owners of company. Professional Managers: Those who have been appointed on account of their specialized knowledge and degree. Political Managers / Civil Servants: Those who manage public sector undertakings. Managers have become a part of elite group of society as they enjoy higher standard of living in the society.

Management as a Science n Science is a systematic body of knowledge pertaining to a specific field of study that contains general facts which explains a phenomenon. It establishes cause and effect relationship between two or more variables and underlines the principles governing their relationship. These principles are developed through scientific method of observation and verification through testing. n Science is characterized by following main features: n Universally acceptance principles – Scientific principles represents basic truth about a particular field of enquiry. These principles may be applied in all situations, at all time & at all places. E. g. – law of gravitation which can be applied in all countries irrespective of the time. Management also contains some fundamental principles which can be applied universally like the Principle of Unity of Command i. e. one man, one boss. This principle is applicable to all type of organization – business or non business. n Experimentation & Observation – Scientific principles are derived through scientific investigation & researching i. e. they are based on logic. E. g. the principle that earth goes round the sun has been scientifically proved. Management principles are also based on scientific enquiry & observation and not only on the opinion of Henry Fayol. They have been developed through experiments & practical experiences of large no. of managers. E. g. it is observed that fair remuneration to personal helps in creating a satisfied work force.

Management as a Science n Cause & Effect Relationship – Principles of science lay down cause and effect relationship between various variables. E. g. when metals are heated, they are expanded. The cause is heating & result is expansion. The same is true for management, therefore it also establishes cause and effect relationship. E. g. lack of parity (balance) between authority & responsibility will lead to ineffectiveness. If you know the cause i. e. lack of balance, the effect can be ascertained easily i. e. in effectiveness. Similarly if workers are given bonuses, fair wages they will work hard but when not treated in fair and just manner, reduces productivity of organization. n Test of Validity & Predictability – Validity of scientific principles can be tested at any time or any number of times i. e. they stand the test of time. Each time these tests will give same result. Moreover future events can be predicted with reasonable accuracy by using scientific principles. E. g. H 2 & O 2 will always give H 2 O. Principles of management can also be tested for validity. E. g. principle of unity of command can be tested by comparing two persons – one having single boss and one having 2 bosses. The performance of 1 st person will be better than 2 nd.

Management as an Art implies application of knowledge & skill to trying about desired results. An art may be defined as personalized application of general theoretical principles for achieving best possible results. Art has the following characters – n Practical Knowledge: Every art requires practical knowledge therefore learning of theory is not sufficient. It is very important to know practical application of theoretical principles. E. g. to become a good painter, the person may not only be knowing different colour and brushes but different designs, dimensions, situations etc to use them appropriately. A manager can never be successful just by obtaining degree or diploma in management; he must have also know how to apply various principles in real situations by functioning in capacity of manager. n Personal Skill: Although theoretical base may be same for every artist, but each one has his own style and approach towards his job. That is why the level of success and quality of performance differs from one person to another. E. g. there are several qualified painters but M. F. Hussain is recognized for his style. Similarly management as an art is also personalized. Every manager has his own way of managing things based on his knowledge, experience and personality, that is why some managers are known as good managers (like Aditya Birla, Rahul Bajaj) whereas others as bad.

Management as an Art n Creativity: Every artist has an element of creativity in line. That is why he aims at producing something that has never existed before which requires combination of intelligence & imagination. Management is also creative in nature like any other art. It combines human and non-human resources in useful way so as to achieve desired results. It tries to produce sweet music by combining chords in an efficient manner. n Perfection through practice: Practice makes a man perfect. Every artist becomes more and more proficient through constant practice. Similarly managers learn through an art of trial and error initially but application of management principles over the years makes them perfect in the job of managing. n Goal-Oriented: Every art is result oriented as it seeks to achieve concrete results. In the same manner, management is also directed towards accomplishment of pre-determined goals. Managers use various resources like men, money, material, machinery & methods to promote growth of an organization.

Management as Profession A profession may be defined as an occupation that requires specialized knowledge and intensive academic preparations to which entry is regulated by a representative body. The essentials of a profession are: n Specialized Knowledge – A profession must have a systematic body of knowledge that can be used for development of professionals. Every professional must make deliberate efforts to acquire expertise in the principles and techniques. Similarly a manager must have devotion and involvement to acquire expertise in the science of management. n Formal Education & Training – There are no. of institutes and universities to impart education & training for a profession. No one can practice a profession without going through a prescribed course. Many institutes of management have been set up for imparting education and training. For example, a CA cannot audit the A/C’s unless he has acquired a degree or diploma for the same but no minimum qualifications and a course of study has been prescribed for managers by law. For example, MBA may be preferred but not necessary.

Management as Profession n Social Obligations – Profession is a source of livelihood but professionals are primarily motivated by the desire to serve the society. Their actions are influenced by social norms and values. Similarly a manager is responsible not only to its owners but also to the society and therefore he is expected to provide quality goods at reasonable prices to the society. n Code of Conduct – Members of a profession have to abide by a code of conduct which contains certain rules and regulations, norms of honesty, integrity and special ethics. A code of conduct is enforced by a representative association to ensure self discipline among its members. Any member violating the code of conduct can be punished and his membership can be withdrawn. The AIMA has prescribed a code of conduct for managers but it has no right to take legal action against any manager who violates it. n Representative Association – For the regulation of profession, existance of a representative body is a must. For example, an institute of Charted Accountants of India establishes and administers standards of competence for the auditors but the AIMA however does not have any statuary powers to regulate the activities of managers.

Features of Principles of Management 1. Principles of Management are Universal • Management principles are applicable to all kinds of organizations – business & non business. • They are applicable to all levels of management. • Every organization must make best possible use by the use of management principles. • Therefore, they are universal or all pervasive. 2. Principles of Management are Flexible • Management principles are dynamic guidelines and not static rules. • There is sufficient room for managerial discretion i. e. they can be modified as per the requirements of the situation. • Modification & improvement is a continuous phenomenon in case of principles of management.

Features of Principles of Management n Principles of Management have a Cause & Effect Relationship • • n Principles of Management - Aims at Influencing Human Behavior • • n Principles of management indicate cause and effect relationship between related variables. They indicate what will be the consequence or result of certain actions. Therefore, if one is known, the other can be traced. Human behavior is complex and unpredictable. Management principles are directed towards regulating human behavior so that people can give their best to the organization. Management is concerned with integrating efforts and harmonizing them towards a goal. But in certain situations even these principles fail to understand human behavior. Principles of Management are of Equal Importance • • • All management principles are equally important. No particular principle has greater importance than the other. They are all required together for the achievement of organizational goals.

DISCUSSION: MANAGEMENT AS PROCESS AND SYSTEM