DedicationTo all of the International MBA Institute students, thank you for inspiring us, keeping usfocused, and making sure we do our best to help you grow in your career with your skillsand knowhow. Without you, your engagement and your loyal support, International MBAInstitute could not come where it is today.

TABLE OF CONTENTSCLICKABLEWELCOME .5ABOUT INTERNATIONAL MBA INSTITUTE .6Introduction .7The Role of Management .11Functions of Managers .14Levels of Management .17Management Skills and Organizational Hierarchy .25Approaches to Management .28Management Planning .34Organizing, Staffing and Controlling .47Thank you .51

WELCOMEHi! I’m Yeliz.I love that you are taking your time to read your MBAbook. I want to briefly share with you why we wantedto write this book for you and how you can get thebest use out of it.Within the context of our MBA degrees we made athorough research in MBA education space.The conclusion was: We failed to find one singletextbook, we could sincerely recommend to ourstudents!We talked to our successful students and found outthat, almost none of the MBA books in the marketcould really help them make a smooth entry to MBAknowhow and practical business execution space.Significant number of MBA books in the marketplaceclaim that they cover all details of MBA, but whatthey are not telling is that, they don't haveunderstandable, clear and logical content to helptheir readers comprehend and most importantly loveMBA!Therefore, we wrote for you MBA books and broughtthem for your service!We are absolutely confident that your MBA books willmake you proficient in MBA subjects, so that you willhave an outstanding opportunity to love MBA andkeep on taking the tangible benefits of being an MBAprofessional.Take some coffee to enjoy and some paper totake your notes, and spend some quiet time toread your MBA books!Afterwards you will have a great understandingabout MBA domains and be prepared to pass yourMBA degree exam. You will be ready to deliver greatproducts and services to your clients and employersand to build your bright career and future!Yeliz ObergfellVice President - Student ExperienceInternational MBA Institute 5

ABOUT INTERNATIONAL MBA INSTITUTE International MBA Institute is an independentinstitute which helps organisations and professionalsget accredited with worldwide renowned and validMBA degrees and prove their competence in MBAdomains. We empower professionals worldwide tobuild their careers, and companies to create and selltheir outstanding products and services.Your MBA Leadership , MBA Management , MBASales , MBA Human Resources , MBA Finance ,MBA Marketing , MBA Business Strategy and MBARecruitment degrees have proven their worldwideacceptance and reputation by being the choice ofmore than 987’000 MBA professionals in 143countries.MBA is a set of open business execution, product,service delivery and leadership frameworks, and yetbefore International MBA Institute was established,there used to be no reasonable way for MBApractitioners like yourself to obtain your accreditedMBA degrees and to prove your competence in MBAdomains. MBA practitioners had to pay expensivefees for the one way profit-driven MBA degrees ofother MBA education providers.International MBA Institute aims to remove thesebarriers set in front of the MBA professionals indeveloped and emerging markets by saving themfrom paying unreasonable fees for MBA classroomtrainings and MBA degree examinations before theyaccredited their knowhow in MBA Domains.Moreover, feel free to check out "What makes YourMBA Degrees Best of the Industry?" section on web portal to read why weperform and serve you far more better than ourcompetition.International MBA Institute provides 8 major onlineMBA degrees which are designed by our consortiumof renowned business and people Leaders, coaches,mentors, experts and authorities from all majorindustries. You can check your MBA degrees fromthis List of MBA Degrees.6

IntroductionIn this chapter, you will: Study the definitions of management Functions of Management Importance of Management Your goal as a ManagerOne of the most important activities in business isthe management of the 4M’s - men, machines,material and money. The term ‘management’ can beinterpreted differently in different contexts. Hence,you will find it difficult to define. In one context, itmay comprise the activities of executives andadministrative personnel in an organization, while inanother, it may refer to a system of getting thingsdone. In a broad perspective, management can beconsidered as the proper utilization of people andother resources in an organization to accomplishd e s i re d o b j e c t i v e s . W i t h i n c re a s i n g g l o b a lcompetition, changes in the world of technology,changing business/practices and increasing socialresponsibility of organizations, your role as amanager has become all the more significant.In this chapter, you will study the definitions ofmanagement given by some eminent managementthinkers to understand the essence of management.Definitions of ManagementThe term ‘management’ can be interpreted in avariety of ways. For you to gain a better insight intothe nature of management, let us look at some ofthe definitions of management:H a ro l d K o o n t z a n d H e i n z We i h r i c h d e fi n emanagement as “the process of designing andmaintaining an environment in which individuals,working together in groups, efficiently accomplishselected aims”.E. Boone and David L. Kurtz define management as“the use of people and other resources toaccomplish objectives.” Dalton E. McFarland definesmanagement as “a process, by which managerscreate, direct, maintain, and operate purposiveorganizations through systematic, coordinated,cooperative human effort”.Mary Parker Follet termed management as “the actof getting things done through people”.7

Definitions by Follet and Louis E. Boone and Kurtzcall attention to the fact that as a manager, you willachieve organizational goals by getting others to dothe necessary tasks. The other two definitionssuggest that management is much more than “justgetting the work done” and (as shown in thefollowing Figure) suggest the following aspects ofmanagement:23Key Aspects of Management Process1Managers carry out the functions of planning,organizing, staffing, leading and controlling:Henry Fayol was the first management thinkerto outline the five basic functions carried outby managers. Every manager performs thesebasic functions. These functions are discussedin detail in the later part of this module.Management is essential to any kind oforganization: Wherever there are groups ofpeople working together to achieve somecommon objectives, it becomes essential toguide, organize and control them. The term‘management’ applies to any organizationirrespective of the size or nature of operations.The prime concern of a CEO of a multinationalcompany, the General Manager of a hotel, thefirst-level supervisor, the manager of a cricketteam and the student president in a college isto manage their people and resourceseffectively.Management is essential at all hierarchicallevels: Management is necessary at all levels.However, the type of skills and the degree towhich various skills are required at differentlevels of the hierarchy may vary. In order toperform their duties satisfactorily, managersneed technical, human, conceptual and designskills.8

45Your goal as a manager is to generate surplus:Your aim as a business managers is to create asurplus. To accomplish this objective, you haveto create an environment which encouragespeople to accomplish as much as possible withthe least amount of resources and personaldissatisfaction. Even in non-profitorganizations, your aim as a manager is toaccomplish your goals with the minimumamount of resources or to make as muchsurplus as possible with available resources.Your aim as a manager is to improveproductivity, efficiency and effectiveness:Productivity is defined as “the output-inputra t i o w i t h i n a t i m e p e r i o d w i t h d u econsideration for quality.” It can be expressedas:Formula of ProductivityProductivity can be improved in the following ways: By producing more output with the sameinputs By reducing inputs, but maintaining the samelevel of outputs By increasing outputs and reducing inputs,thereby, making the ratio more favorableProductivity can be improved by ensuring efficiencyand effectiveness in the operations of the firm.Effectiveness refers to achievement of statedorganizational objectives while, efficiency denotesthe judicious use of resources, to achieveorganizational objectives. In the words of PeterDrucker, efficiency means “doing things right”, whileeffectiveness means “doing the right things.” In hisbook, “Management — Tasks, Responsibilities,Practices”, Drucker states that effectiveness is thefoundation of success whereas efficiency is atminimum condition for survival after success hasbeen achieved.Summary:1 Management is the ability to achieve goals bygetting others to do the necessary tasks. It isalso referred to as much more than “justgetting the work done”.2 Management is essential to any kind of anorganization irrespective of their size or natureof operations.9

34Management is essential to all hierarchicallevels.A manager’s goal is to generate surplus,i m p rov e p ro d u c t i v i t y, e ffi c i e n c y a n deffectiveness.10

The Role of ManagementIn this chapter, you will: Use of “structured observations” by HenryMintzberg Understand the various types of roles of amanagerAs mentioned in the earlier chapter, as a manageryou perform five functions — planning, organizing,staffing, leading and controlling. Since thesef u n c t i o n s a re v e r y e s s e n t i a l f o r e ff e c t i v emanagement, they have been used as the basicframework for this module.In order to understand the role of management, inthe late 1960s, Henry Mintzberg devised a newapproach — the managerial roles approach — byobserving what managers actually do. He did acareful study of five chief executives at work andfound that they were involved in a number of varied,unpatterned activities of short duration. Using amethod called structured observation, Mintzbergisolated ten roles which he believed were common toall managers. As shown in the below list, these tenroles were grouped into three categories —interpersonal roles, informational roles anddecisional roles.As a manager you are required to interact with manypeople, both within and outside the organization andhence, the need to perform interpersonal roles. Thethree interpersonal roles of a manager arefigurehead, leader and liaison. In your role as afigurehead, you would perform all the ceremonial orsymbolic duties. Example, it would be the duty of acollege dean to award diplomas at the convocationceremony. In the leadership role, you are required tomotivate the employees to perform at their best toachieve the company’s objectives. In the liaison role,you are required to interact with people both withinand outside the organization.As a manager, you act as a channel of informationwithin the organization. The three informationalroles of a manager are that of a recipient,disseminator and spokesperson. In the role of arecipient, you receive information pertaining tochanges, opportunities and problems that theorganization may face. As a disseminator, youprovide information to subordinates that wouldinfluence their performance at work. And finally, you11

perform the role of a spokesperson when yourepresent the organization in public. InterPersonal: Figurehead: You perform ceremonialand symbolic duties such as greetingvisitors, signing legal documents. Leader: You direct and motivatesubordinates, training, counselling, andcommunicating with subordinates. Liaison: You maintain information linksboth inside and outside organization; usemail; phone calls; meetings.Informational: M o n i t o r : Yo u s e e k a n d r e c e i v einformation, scan periodicals andreports, maintain personal contacts. Disseminator: You forward informationto other organization members; sendmemos and reports, make phone calls. Spokesperson: You transmit informationto outsiders through speeches, reports,memos.Decisional: Entrepreneur: You initiate improvementprojects, identify new ideas, delegateidea responsibility to others. D i s t u r b a n c e H a n d l e r : Yo u t a k ecorrective actions during disputes orcrises; resolve conflicts amongsubordinates; adapt to environmentalcrises.Resource Allocator: You decide whogets resources, scheduling, budgeting,setting priorities.Negotiator: You represent departmentduring negotiation of union contracts,sales, purchases, budgets; representdepartmental interests.The third category deals with the most importantrole of a manager. In this role, as a manager youperform the most crucial task i.e. you take decisionswhich may affect an organization’s well-being. Thefour decisional roles of a manager are that of anentrepreneur, disturbance handler, resourceallocator and negotiator. In an entrepreneurial role,you as a manager seek innovative methods toimprove the performance of at unit or the firm as awhole. As a disturbance handler, you take remedialactions for situations, which may affect the credibilityof a firm. In the role of a resource allocator, youallocate various resources of the organization suchas money, time, material etc. to the employees for12

running the business effectively. Finally, in the role ofa negotiator, you negotiate with other units or otherparties like suppliers, customers and government,keeping in mind the interests of his unit ororganization.Summary:1 Categories of different roles of a manager asstudied by Henry Mintzberg: Interpersonal Informational Decisional2 Each category is further divided into differentroles of a manager: Figurehead, Leader and Liaison belong toInterpersonal category. Monitor, Disseminator andSpokesperson belong to Informationalcategory. Entrepreneur, Disturbance Handler,Resource Allocator and Negotiatorbelong to Decisional category.13

Functions of ManagersIn this chapter, you will: Understand the framework of management: Planning Organizing Staffing Leading ControllingThe functions of a manager provide a usefulframework for organizing management knowledgeunder the various heads of planning, organizing,staffing, leading and controlling. Managerialfunctions are effective tools for you as a manager toachieve the organization’s planned objectives. Theyinclude the general administrative duties that needto be carried out in virtually all organizations.Following figure depicts the management processand shows the various functions that managers areinvolved in. It is evident from the figure thatmanagers are involved in more than one activity atthe same time.PlanningPlanning can be defined as the process, by which,you decide the mission and objectives of the firmand take necessary steps to achieve the desiredobjectives. At the same time, you need to determinethe future trends in business and incorporate changeand innovation into the organization from time totime.Management FunctionsThere are various types of plans and they may rangefrom planning to define the overall purposes andobjectives of an organization to planning for aspecific action. Planning helps a firm decide its futurecourse of action.14

OrganizingOrganizing is the process of assigning tasks andallocating resources to individuals to enable them toaccomplish organizational goals. Organizing is acontinuous process of determining (1) which tasksare to be performed, (2) how tasks can best becombined into specific jobs, (3) how jobs can begrouped into various units, and (4) the authority andreporting relationships within the corporatehierarchy. The organizational structure of a firm is akey element in determining its success or failure. Ifplans are not organized properly even the best ofplans can fail. On the other hand, the pitfallsassociated with a poor plan can be eliminated byexcellent organization.performance appraisal, promotion and careerplanning.StaffingToday, staffing is better known as “human resourcemanagement” and involves manning or filling thevarious positions in the organizational hierarchy.Activities like determining manpower requirements,assessing the number of people presently availablein the organization, recruiting and selectingcandidates, training and placing them in theorganization come under the purview of staffing.This function also deals with compensation,ControllingThe final step in the management process is whereyou monitor the progress of an organization towardsits goals. Controlling can be defined as thecontinuous measurement and analysis of actualoperations against the established industrystandards developed during the planning processand corrections of deviations, if any.LeadingLeading is defined as “the management function ofinfluencing, motivating, and directing people towardsthe achievement of organizational goals.” It is themanagement function that involves influencing andinspiring team members to perform well andaccomplish corporate objectives. Leading involves (1)communicating with others, (2) leadership styles andapproaches, and (3) motivating people to put forththe effort required to achieve organizational goals. Insimple words, it is the act of making things happenthrough others.The basic control process involves (1) comparingperformance with standards, (2) determining where15

negative deviations occur, and (3) developingremedial measures to correct deviations.Summary:1 Planning: helps in crafting mission andobjectives of the firm.2 Organizing: helps assign tasks and allocateresources to enable individuals achieveorganizational goals.3 Staffing: involves manning or filling variouspositions in organizational hierarchy.4 Leading: defined as the management functionof influencing, motivating, and directing peopletowards organizational goals.5 Controlling: The process of continuousm e a s u re m e n t a n d a n a l y s i s o f a c t u a loperations against standards is controlling.16

Levels of ManagementIn this chapter, you will: Understand different levels of management Top-level managers Middle-level managers First-level managers Understand the different roles of individuals ateach level of management Understand the time spent by different levelsof managersIn many small business enterprises, the owner is theonly member of the management team. But, as thesize of an organization increases, a moresophisticated organizational structure is required. Itis a normal practice to categorize management intothree basic levels: (1) top-level management, (2)middle-level management, and (3) supervisory orfirst-level management. Following figure illustratesthe levels of management. The duties andresponsibilities at these three levels of managementvary from organization to organization, dependingupon the size, technology, culture, etc. prevailing inyour organization.The number of managerial positions at each levelvaries from organization to organization. In most ofthe organizations, there are more positions at thefirst-level, fewer in the middle, and very few at thetop. Many describe this kind of an organizationalstructure as a pyramid, as the managerial positionsgradually decline as one progresses towards thehigher levels of management. The various activitiesperformed at each of these levels of managementare illustrated below.Levels of Management17

Vice President” and “Executive Director.” As a toplevel manager, you are responsible for taking majordecisions for the organization as a whole. You areresponsible for the overall activities of the businessand are accountable for its impact on the society atlarge. You work to some extent with the middle-levelmanagers in implementing the plans, andmaintaining overall control over organizationalperformance.Managerial Levels and AreasTop-Level ManagersAs a top-level managers are usually appointed,elected or designated by the organization’s governingbody. They are few in number, and they include jobclassifications such as the “Chief ExecutiveOfficer” (CEO), “President”, “Vice President”, “SeniorIn public limited companies, top-level managersreport to the Board of Directors. Members of theboard are selected by shareholders. Depending onthe size of the company, the number of boardmembers vary from 15 to 25. When a boardcomprises a majority of individuals who have closeties with the management, they essentially act as“rubber stamps”. But, on the other hand, boards withmore outsiders operate more independently and aremore proactive. Though it is a usual practice to electthe CEO as the chairperson of the board, a study hassuggested that companies having an outsider as aboard chairperson perform better, as he/she helpsthe board to monitor the performance of the topmanagement objectively.18

Functions at Various Levels of ManagementTop Management: Develops and reviews long-range plans andstrategies. Evaluates overall performance of variousdepartments and ensures cooperation. Involved in selection of key personnel. Consults subordinate managers on subjects orproblems of general scope.Middle Management: Makes plans of intermediate-range andprepares long-range plans for review by topmanagement. Analyzes managerial performance todetermine capability and readiness forpromotion. Establishes departmental policies. R ev i ew s d a i l y a n d w e e k l y re p o r t s o nproduction or sales. Counsels subordinates on production,personnel or other problems. Selects and recruits personnel.Supervisory Management: Makes detailed, short-range operational plans. Reviews performance of subordinates. Supervises clay-to-day operations.Makes specific task assignments.Maintains close contact with employeesinvolved in operations.General Responsibilities of a Chief ExecutiveThe Chief Executive bears the followingresponsibilities:Leader: Acts as an adviser to the board Formulates a mission for the organization andincorporates change and innovation Supports organizational programs to improveorganizational effectivenessVisionary Ensures availability of relevant information tothe board members Anticipates future trends and looks out foropportunities Acts as an interface between the board and theemployees Acts as an interface between the organizationand the community and functions as aspokesperson for the organization19

Decision-maker: Formulates the mission, policies andprocedures for the smooth functioning of theorganization Devices action plans for the staffManager: Ensures the running of an organization withoutany bottlenecks Oversees the implementation of plans Manages the material, financial and humanresources of the organizationBoard Developer: Helps in selecting and evaluating boardmembersKeeps the board updated regarding theorganization's activitiesA Guide to Middle Manager SurvivalIn today’s world, restructuring and downsizing haveled to the emergence of flatter organizations. Middlemanagers have been the most affected by thesechanges. You will find that many managementwriters consider middle managers as “excessorganizational baggage.” Ironically, middle managersare the most potential assets of the organization.Many organizations have the false notion that byremoving these managers, they can restructurethemselves better. To ensure continued survival ofmiddle managers, a number of individual andorganizational actions can be undertaken. These arelisted below:1 Focus on important strategic issues: Middlemanagers should move away from the day-todays operations (which can be delegated to thefirst-line managers) and devote their attentionto the more important strategic issues.2 Think like senior managers: They should usetheir extensive knowledge to deal with moresubstantive issues that would lead toorganizational benefit.3 Analyze why change is needed: They mustunderstand the underlying causes forintroducing change and how the organizationshould adapt itself in the light of opportunitiesand threats.4 Ensure greater participation: Middle managershave a great deal of technical expertise andgood knowledge of organizational processes.This knowledge should be disseminatedthroughout the organization.5 Manage change and people together: Middlemanagers should take the initiative for20

implementing change in the organization. Theyshould act as mentors for those with lesserwork experience.6 Utilize their role as intermediaries: Middlemanagers can comprehend the internal andexternal pressures faced by the organization.They can resolve conflicting issues bynegotiating with the parties concerned.7 Implement the vision: Middle managers mustattempt to convert top-level strategies intoworkable actions. They should take up theresponsibility to implement the vision of theorganization.8 Incorporate change into the organization:Middle managers must understand how toimplement change in the organization. Theyshould introduce work practices that bring ininnovation and “shifts in thinking.”In the words of Rory Chase, Managing Director of IFSInternational in Bedford, “The new role of the middlemanager embraces three key areas; team leadership,change maker and facilitator.” There is no doubt thatin order to survive in this rapidly changing era,middle managers have to make themselvesindispensable.Middle-Level ManagersMiddle-level managers deal with the actual operationof various departments in an organization. As amiddle-level manager, you are directly responsiblefor the performance of managers at lower levels. Thetypical titles include “manager”, “director”, “chief”,“department heads and “divisional head.” Thenumber of middle-level managers in complexorganizations is far higher than other managers. Inthe capacity of a middle-level manager, you areresponsible for implementing the plans andstrategies developed by top management for theaccomplishment of organizational goals. You look tothe top management for direction and guidance andare answerable to them. In many organizations,middle-level managers serve as a source ofinnovation and creativity. Thus, you play a vital role inthe success of the organization.Due to the advent of information technology, onlinetechnical assistance has become available to firstlevel managers. This has resulted in making middlelevel managers redundant and has thus reduced thenumber of middle-level managers in manyorganizations.21

The Role of the SupervisorThe first-line supervisor (irrespective of the formaldesignation “foreman”, “chief clerk” or “sectionengineer”), can ensure that his employees performthe best. A worker’s ability to perform depends onthe capacity of the first-line supervisor to plan,organize well. The training that a supervisor providesto his employees will determine the worker’sperformance. It is the responsibility of a supervisorto ensure that the workers have the necessarymaterials and equipment to do the work. He shouldcreate a good working environment for all hisemployees. The supervisor sets goals in accordancewith the organization’s plans and makes sure thateach worker achieves the determined targets.For a supervisor to perform his job well, he needs tohave crystal clear objectives. These objectives mustbe in line with the organizational goals. He shouldhave adequate information about the company’soperations, its structure, its goals and itsperformance.Secondly, the supervisor should have a thoroughunderstanding of promotional opportunities andperformance benchmarks. Promotionalopportunities would determine the motivation levelsof the supervisor. It is essential for the supervisor toknow that there are better chances for a person whoperforms well. In the words of Peter Drucker,“Manager development must begin withsupervisors.” This means that today’s supervisorscan be the managers of tomorrow. The supervisorsmust be considered for positions in middlemanagement as they have both technical andinterpersonal skills. In other words, they are aware ofthe way in which the organization functions as wellas the needs of the workers.Finally, the job of a supervisor should give himsatisfaction. He must be accorded a status that willmake him feel important. He must he in a position todirect employees and get the management, to listento him.It is imperative that a supervisor’s job is properlyplanned so that, over a period of time, they can bepromoted as managers. The supervisor has toassume greater responsibilities and therefore, he hasto be prepared to set objectives, to organize and toplan. Proper organization of a supervisor’s job willlead to conceptual and analytical integration and willprepare him to take up larger responsibilities infuture.22

First-Level ManagersFirst-level managers are directly responsible for theperformance of employees involved in operations.They are usually called supervisors. If you are a firstlevel

MBA Marketing , MBA Business Strategy and MBA Recruitment degrees have proven their worldwide acceptance and reputation by being the choice of more than 987'000 MBA professionals in 143 countries. MBA is a set of open business execution, product, service delivery and leadership frameworks, and yet .