Enrollment No.

MBISMCT10716140

MBA Information Systems 1st Year - Assignment

Annamalai University

1: Principle of Management

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Enrollment No. MBISMCT10716140

Question.1: Discuss the importance and application of principle of management in the present
day context.
Answer:

PRINCIPLE OF MANAGEMENT
Management
Management is a global phenomenon. It is a very popular and widely used term. All
organizations - business, political, cultural or social are involved in management because it is the
management which helps and directs the various efforts towards a definite purpose.
Management is a process of planning, organizing, leading and controlling the efforts of
organization members and using all other organizational resources to achieve stated
organizational goals. It is the process of working with and through others to effectively achieve
the goals of the organization, by efficiently using limited resources in the changing world.
Management involves creating an internal environment; it is the responsibility of management to
create such conditions which are conducive to maximum efforts so that people are able to
perform their task efficiently and effectively. It includes ensuring availability of raw materials,
determination of wages and salaries, formulation of rules & regulations etc. Good management
includes both being effective & efficient.
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 and
can co-operate towards attainment of group goals- Harold Koontz.
Management is an art of knowing what to do, when to do and see that it is done in the best and
cheapest way.- F.W. Taylor.
To manage is to forecast, to plan, to organize, to command to co-ordinate and control. -Henry Fayol

Management can be in following categories:

Management as Process
Management as Activity
Management as Discipline
Management as Science
Management as Art
Management as Profession

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Fayols Principle of Management

Hanery Fayol is widely acclaimed as the founder of the classical school of management. He was
the first to systemized the management is all about. In attempt to develop a science of
management he divided business operations in six activities:
Technical, Commercial, Financial, Security, Accounting, Managerial.
Fayol primary focus was managerial and he evolved fourteen principles of management which
may be briefly stated as follows:
1. Division of Labour
2. Authority and Responsibility
3. Discipline
4. Unity of Command
5. Unity of Direction
6. Subordination of Individual Interest to the Common Good
7. Remuneration
8. Centralization
9. The Hierarchy (Scalar Chain)
10. Order
11. Equity
12. Stability of Staff
13. Initiative
14. Esprit de Corps
1. Division of Labor: The object of division of work is to derive the benefits from the principle
of specialization which can be applied not only in technical work, put in all other work as well.
Fayol pointed out that division of work has its obvious limits.
2. Authority and Responsibility: Responsibility is the essential counterpart of authority and
they are correlated. An ideal manger is expected to have official authority arising from official
positions as well as his inherent personal authority. Such person authority is compounded of
intelligence experience, moral worth, ability to lead, past services, etc.
3. Discipline: Members in an organization need to respect the rules and agreements that govern
the organization. Discipline is what the leaders make it, through the observance of agreements,
because agreements spell out to formalities of discipline. Three requisites of discipline are (a)
good supervisors at all levels, (b) clear and fair agreements, and (c) judicious application of
penalties of sanctions.
4. Unity of Command: This principle requires that employee should receive orders form one
superior only. Dual command wreaks havoc in all concerns, when an employee reported to more
than one superior, conflict in instruction and confusion of authority would result.
5. Unity of Direction: While unity of direction is concerned with the functioning of the body
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corporate, unity of command is only concerned with the functioning of personnel at all levels.
For the accomplishment of a group of activities having the same objective, there should be one
manager and one plan. A body with two heads is in the social as in the animal sphere a monster,
and has difficulty in surviving.
6. Subordination of Individual Interest to the common Good: Common interest must prevail
over individual interest, but some factors like ambition, laziness, weakness and others tend to
reduce the importance of general interest.
7. Remuneration: As the prices of services rendered remunerations should be fair and
satisfactory to both the parties.
8. Centralization: Everything which goes to increase the importance of the subordinate's role is
decentralization; everything which goes to reduce it is centralization. Fayol believed that
manager should retain the final responsibility but also need to give their subordinated enough
authority to perform their jobs properly.
9. The Hierarchy (Scalar Chain): It is the chain of superiors or the line of authority form the
highest executive to the lowest one for the purpose of communication. The need for swift action
should be reconciled with due regard to the line of authority by using gang plank or direct
contact.
10. Order: This is a principle of organization relating to things and persons material order
requires a place for everything and everything in its place and social demands the engagement of
the right man in the right place.
11. Equity: Equity is greater than justice, since it results from the combination of kindliness and
justice. The application of equity requires much good sense, experience and good nature with a
view to securing devotion and loyalty form employees.
12. Stability of Staff: Stability of tenure is essential to get an employee accustomed to doing a
new work and to enable him in performing it well. Instability of tenure is an evidence of bad
running of affairs.
13. Initiative. The freedom to purpose a plan and to execute it is what is known as initiative that
increases zeal and energy on the part of human beings. Since initiative is one of the keenest
satisfactions for an intelligent man to experience. Fayol advised managers to secure as much
initiative from employees as possible.
14. Espirit de corps. This is an extension of the principle of unity of command whereby team
work is ensured. To maintain proper espirit de corps in the organization, personality politics and
abuse of written and communications are to be guarded against.

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Application of Principle of Management

Principles of management work together to help an organization to achieve a particular result and
reach its goals. It makes an individual contribution to an organization's overall effectiveness, and
they all interrelate. Management Principle are applicable in any type of organization for the
following purposes:
1. Planning
2. Organizing
3. Motivation
4. Controlling
5. Coordinating
6. Communicating
1. Planning: Planning involves formulating a course of action. The forecast plays an important
role in the organization plans to be prepared to meet the forecast, it is the process of calculating
or predicting a future event through analyzing available data. Planning can include identifying
how much work is required and what resources are needed.
2. Organizing: Organizing consists of arranging resources into a coherent whole. This can
include the creation of an administrative structure, but can also be as detailed as arranging the
flow of materials through a manufacturing facility or the flow of paperwork through an office.
Organizing describes in detail precisely how the plan will be accomplished.
3. Motivation: Motivation creates a desire in people to act. In the case of organizational
management, motivation is specifically directed towards getting people to act pursuant to the
structure defined by the organizing step. Motivation can be in the form of rewards, such as
compensation, or in the form of punishments, such as loss of compensation/employment.
4. Controlling: Controlling is the process of directing the use of resources and verifying that the
plan is being accomplished through the procedures identified in the organizing step. Controlling
also includes taking corrective action in event that the plan is not being accomplished because
procedures are not being followed. Identifying whether the problems exist in terms of
motivating, organizing, planning, or forecasting is essential to exerting control that will lead the
organization to the desired outcome.
5. Coordinating: Coordinating consists of getting disparate resources to work together. Not
only must an organization be coordinated within itself, but an organization must be coordinated
with its suppliers and customers if it is to be successful. Within the organization, coordination
plays the important role of ensuring that forecasting, planning, organizing, motivating, and
controlling are internally consistent and moving in all aspects of the organization towards
achieving its goals. Coordinating outside of the organization helps to refine the forecast,
planning, and organizing processes by gathering inputs from customers and suppliers regarding
their needs and capabilities.
6. Communicating: Communicating pulls all of the other principles of management together.
Each phase requires communication so that everyone involved can provide input and know the
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result. Further more, information has to be communicated between each of the processes so that
they remain consistent with the organization's overall objectives. Communication with
customers and suppliers is also critical so that as much information as possible is available at
each step. Communication is important in the event of a problem identified at a particular step
that affects other principles, such as identified problems with the forecasting or organizing steps,
so that it can be addressed.

Importance of Management Principle

Following are the main importance of the Principles of Management.
1. Improves Understanding.
2. Direction for Training of Managers.
3. Role of Management.
4. Guide to Research in Management.
5. Establishes Sound Organization
6. Essentials for Prosperity of Society
1. Improves Understanding: From the knowledge of principles managers get indication on
how to manage an organization. The principles enable managers to decide what should be
done to accomplish given tasks and to handle situations which may arise in management.
These principles make managers more efficient.
2. Direction for Training of Managers: Principles of management provide understanding of
management process what managers would do to accomplish what. Thus, these are helpful in
identifying the areas of management in which existing & future managers should be trained.
3. Role of Management: Management principles makes the role of managers concrete.
Therefore these principles act as ready reference to the managers to check whether their
decisions are appropriate. Besides these principles define managerial activities in practical
terms. They tell what a manager is expected to do in specific situation.
4. Guide to Research in Management: The body of management principles indicate lines
along which research should be undertaken to make management practical and more
effective. The principles guide managers in decision making and action. The researchers can
examine whether the guidelines are useful or not. Anything which makes management
research more exact & pointed will help improve management practice.
5. Establishes Sound Organization: To establish sound organizational structure is one of the
objective of management which is in tune with objective of organization and for fulfilment of
this, it establishes effective authority & responsibility relationship. Management fills up
various positions with right persons, having right skills, training and qualification. It enables
the organization to survive in changing environment. With the change is external
environment, the initial co-ordination of organization must be changed. It is responsible for
growth and survival of organization.
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6. Essentials for Prosperity of Society - Efficient management leads to better economical
production which helps in turn to increase the welfare of people. Good management makes a
difficult task easier by avoiding wastage of scarce resource. It improves standard of living. It
increases the profit which is beneficial to business and society will get maximum output at
minimum cost by creating employment opportunities which generate income in hands.
Organization comes with new products and researches beneficial for society.

Principle of Management in Day to Day Context

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.
3. Principles of Management have a Cause & Effect Relationship
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.
4. Principles of Management - Aims at Influencing Human Behavior
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.
5. 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.

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Question.3: Direction function of management involves dealing with human factor Explain this
statement.

Answer:

DIRECTION FUNCTION
Basic Concepts about Directing
Direction consists of the process and techniques utilizing in issuing instruction and making
certain that operations are carried out as originally planned. Direction is a complex function that
includes all those activities which are designed to which encourage subordinates to work
effectively and efficiently in both short and long run.
Direction is telling people what to do and seeing that they do it to the best of their ability.
Directing deals with the steps a manager takes to get subordinates and others to carry out plans.
Direction provides link between different functions in an organization.
Direction is moving to action and supplying simulative power to the group.-George R Terry.
Directing concerns the total manner in which a manager influences the actions of subordinates.
It is the final action of a manager in getting others to act after all preparations have been
completed. Massie

Directing Function of Management

Directing is influencing people's behaviour through motivation, communication, group
dynamics, leadership and discipline. The purpose of directing is to channel the behaviour of all
personnel to accomplish the organization's mission and objectives while simultaneously helping
them accomplish their own career objectives.
Managers give this function a variety of names i.e. leading, influencing, coaching, motivating,
interpersonal relations, and human relations. The directing function gives the manager an active
rather than a passive role in employee performance, conduct and accomplishments. Managers
accomplish their objectives through people. In blaming others for her or his human resource
problems, a manager is denying the management responsibilities inherent in the directing
function.
The directing function gives managers a second responsibility: helping people in the organization
accomplish their individual career goals. Organizations do not succeed while their people are
failing. Helping people in the organization with career planning and professional development is
an integral part of the directing function.
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Elements of Direction
The directing function of management consists of four elements or sub-functions:
(i) Leadership;
(ii) Communication;
(iii) Motivation;
(iv) Supervision;
(i) Leadership: A manager has to issue orders and instructions. He has to guide and counsel
his subordinates in their work in order to improve their performance and achieve enterprise
objectives. It is the process by which an executive or manager imaginatively directs/guides and
influences the work of others in choosing and attaining specified goals by mediating between the
individual and organization in such a manner that both will get maximum satisfaction. It is the
ability to build up confidence and zeal among people and to create an urge in them, to be led. In
order to be a successful leader, a manager must possess the qualities of foresight, drive, initiative,
self-confidence and personal integrity. Different situations demand different type of leadership,
such as autocratic leadership, democratic leadership and free rein leadership.

Element of Leadership are as follows:

It is a process of influence. Its purpose is to influence the behavior of followers to get willing
cooperation of a members or the group.
It involves interaction between two or more person. The interaction between the leader and
his followers is based on interpersonal relationship which grows out of the leaders support
and help to the followers in achieving their individual and group goals.
It Involve pursuit of common goal under the advice and guideline of the leader in the interest
of individuals group and organization.
It s Always related to Situation. The style of leadership differs from situation to situation.

(ii) Communication: Communication is said to be the number one problem of management

today. Managers spend 75 to 90 per cent of their working time in communicating with others.
Communication is the means by which the behaviour of the subordinates is modified and change
is effected in their actions.
Communication means sharing of ideas in common. The essence of communication is getting the
receiver and the sender tuned together for a particular message. It refers to the exchange of ideas,
feelings, emotions, knowledge and information between two or more persons. Nothing happens
in management till communication takes place.
Communication is a two way process. It involves both information and understanding. It may be
written, oral or gesture. It is said to be formal when it follows the formal channels provided in
the organization structure. It is informal communication, when it does not follow the formal
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channels. It flows downward from a superior to subordinates and upward from subordinates to
superior. It also flows between two or more persons operating at the same level of authority.
Communication is essential at all level of management for decision-making and planning. It
increases managerial capacity and facilitates control. Good managers are good communicators
and poor managers are poor communicators.
(iii) Motivation: Motivation is the psychological process of creating urge among the
subordinates to do certain things or behave in the desired manner.
"Motivation means the act of stimulating some one or oneself to get a desired course of action to push the right button to get a desired reaction - a compliment, dollar raise, a smile, a promise
of a raise, a new typewriter, a preferred location or a new desk. - Michael Jucius
The importance of motivation can be realised from the fact that performance of a worker
depends upon his ability and the motivation. There are many strategies adopted by managers for
increasing the motivation of subordinates.
A manager bas to provide some personal incentive to the subordinates to motivate, persuade and
inspire them for contributing their best towards the achievement of enterprise objectives. The
incentives may be financial, such as increase in wages, or non-financial, like better working
conditions, job security, recognition, etc. A sound motivational system must be productive,
competitive, comprehensive and flexible, and it must consider the psychological, social, safety,
ego and economic needs of the workers.
(iv) Supervision: Supervision is an important directing function of management. After issuing
instructions, the manager or the supervisor bas to see that the given instructions are carried out.
Supervision refers to the job of overseeing subordinates at work to ensure maximum utilization
of resources, to get the required and directed work done and to correct the subordinates whenever
they go wrong. Though supervision is performed at all levels of management, the major
responsibility for it lies with the first line of management. Sound organizational set-up, effective
delegation, human approach, effective communication and management by exception make
supervision effective.

Features of Direction
Following are the main features of direction:
1. An Important Management Function;
2. Pervasive Function;
3. Continuing Function;
4. Chain of Command;
5. Creative Function;
6. Linking Function;
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7. Delegate Function;
8. Human Factor;

1. An Important Management Function: Direction is an important function of

management. Through it the management initiates actions in the organization. It starts after plans
are drawn up, organization properly designed, and able persons are appointed on the responsible
posts. Planning, organizing and staffing functions of management are useless unless there is
proper direction of the people in the use or various resources. It helps in achieving co-ordination
in the organization.

2. Pervasive Function: Direction is a pervasive function of management, performed at every

level of management in the context of superior subordinate relationship. Direction or issuing
instructions or providing guidance and leadership flow from top to bottom among the scalar
chain as every manager in the organization is superior as well as subordinate except manager at
the extreme top and manager at extreme bottom. Direction is thus performed by every manager
as he guides, leads and motivates his subordinates. Managers at the bottom guide workers of
rank and file.

3. Continuing Function: Directing activity continues throughout the life of the organization.
A manager never ceases to guide, lead and inspire his subordinates. He continuously supervises
whether his orders and instructions are strictly carried out by his subordinates.

4. Chain of Command: Direction initiates at the top level and follows to bottom through the
hierarchy. Every subordinate is to be directed by his own superior only.

5. Creative Function: Direction is a creative function of management which converts plans

into action. Directing is management in action. It is the process around which performance
revolves. Without direction, human factor in the organization becomes inactive and useless and
other resources in the organization remain unutilized.

6. Linking Function: Direction provides link between preparatory functions such as planning,
organizing, staffing and controlling. It provides necessary materials for the comparison of
performance with the plans.

7. Delegate Function: Direction is supposed to be a function dealing with human beings.

Human behaviour is unpredictable by nature and conditioning the peoples behaviour towards the
goals of the enterprise is what the executive does in this function. Therefore, it is termed as
having

8. Human Factor: Directing is concerned with the human factor in the organization which is
guided, motivated and supervised so as to ensure that it contributes to the objectives of the
organization effectively and efficiently. Human factor is dynamic. It is conditioned by a
complexity of forces about which not much is known and over which management has little
control. It is, therefore, a very difficult and challenging function of management.
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IMPORTANCE OF DIRECTION
Directing or Direction function is the heart, the essence, of the management process in the sense
that it works as a nucleus around which all other management functions like planning organizing
staffing revolve. It is also called as Life spark of an organization. Being the central character
of enterprise, it provides many benefits to a concern which are as follows:1. Initiates Action;
2. Integrates Employees' Efforts;
3. Means of Motivation;
4. Provides Stability & Balance in the Organization;
5. Facilitates Changes;
6 Works as a Nucleus;
7. Efficient Utilization of Resources;

1. Initiates Action: It makes use of the preconditions created by planning, organizing, and
staffing and initiates action by issuing instructions to subordinates and by supervising their work.
Thus, without direction, all these managerial activities remain ineffective.

2. Integrates Employees' Efforts: It is the integrating function of management in the sense

that it integrates the individual and group goals with organizational objectives. It integrates the
efforts of employees by supervising, guiding and counselling.

3. Means of Motivation: It motivates the employees to contribute to the best of their abilities
for the achievement of organizational objectives. This can be done by providing incentives or
compensation, whether monetary or non - monetary, which serves as a Morale booster to the
subordinates to the best of their abilities which ultimately helps in growth of organization.

4. Provides Stability & Balance in the Organization: It brings about stability and balance
in the organization through interpersonal communication, effective leadership and motivation.

5. Facilitates Changes: It enables the organization to cope with the changing conditions of the
environment through effective communication and persuasive leadership. Human behaviour
resist to change, before the change is introduced, the employees may be informed about the
nature of changes and the benefits that are likely to follow, and they may be taken into
confidence through persuasive leadership and information sharing.

6. Works as a Nucleus: It works as a nucleus around which all other management functions,
planning, organizing, and staffing evolve.
7. Efficient Utilization of Resources: Direction function helps in clarifying the role of every
subordinate towards his work. Through direction, the role of subordinates become clear as
manager makes use of his supervisory, the guidance, the instructions and motivation skill to
inspire the subordinates. This helps in maximum possible utilization of resources of men,
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machine, materials and money which helps in reducing costs and increasing profits

Direction function of management involves dealing with human factor

Organization are social system, compose of roles, interactions and relationship among people
occupying various positions in its structure. Success of an organization is in accomplishing its
goals significantly depend on the nature and patterns of cooperation among individuals and
formal and informal groups. As such, people, as individuals as well as group members, constitute
the pillars of organising effort. Technological product, or strategic superiority of an organization
over its competitors provides it only a temporary gain as all these things lend themselves to
adaptation by competitors. But employee motivation, capabilities and climate of human
endeavour are the things which one organization can not copy from another.
The importance of human factor in the success of organization effort also arises from the fact
that people are not subject to manipulation like machines, as they have their attitudes, motives,
feelings, apprehensions, aspirations, etc. No doubt, these all are influenced by organizational
policies and practices but not determined and governed by it. Human assets of organization,
unlike physical assets, continuously appreciate in value, as knowledge, abilities and skills all
grow with training and experience.
Direction is one of the most complex function of the management as it ideals with people whose
nature itself is quite complex and unpredictable. Directing is the function of guiding, inspiring,
overseeing and instructing people towards accomplishment of organizational goals. Direction
represents one of the essentials functions of management works on the following principles
which deals with human relations directly.
1. Principle of Harmony of Objectives;
2. Principle of Maximum Individual Contribution;
3. Principle of Efficiency of Direction;
4. Principle of Unity of Command;
5. Principle of Managerial Communication;
6. Principle or Comprehension;

1. Principle of Harmony of Objectives: Individuals join an organization to achieve certain

objectives. They want to satisfy their physiological and psychological needs while working in the
organization. The organization has its own objectives which it wants to achieve with the help of
individuals. Through proper direction techniques the management should try to integrate these
two objectives. Common interest must prevail upon personal objectives.

2. Principle of Maximum Individual Contribution: Every individual in the organization

has some capability and ability to perform the task. These capabilities should be harnessed so as
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to achieve maximum contribution to the organization through individuals. The management
should adopt such direction technique that may elicit maximum possible contribution from each
subordinate. This needs effective leadership and motivation.

3. Principle of Efficiency of Direction: Direction should be efficient to lead to

accomplishment of objectives without adversely affecting needs satisfaction of individuals. To
provide adequate satisfaction to subordinates, it is necessary to develop correct direction
techniques, effective communication system and leadership etc. suitable to the situation.

4. Principle of Unity of Command: According to this principle a person in the organization

must get orders and instructions only from one superior. If he gets orders and instructions from
more than one superior, it will create confusion and instability in the organization.

5. Principle of Managerial Communication: The success of an organization depends very

much on the effectiveness of communication system between the superior and his subordinates.
There should be two-way communication, downward carries the orders, ideas, instructions to the
subordinates and upward enables a manager to understand the subordinates performance and
opportunity to express their feelings. Two-way communication makes direction effective.

6. Principle or Comprehension: Direction conveys to subordinates what to do? how to do?

and when to do? The manager should ensure that subordinates understand his instructions and
orders correctly in the same sense in which they are conveyed. Clear understanding or direction
enables them to get clear situation and avoid unnecessary explanation from superior.

Conclusion
Directing is the process of integrating the people with the organization so as to obtain their
willing and zealous cooperation for the achievement of its goals. This requires integration of
organizational goals with individual and group goals. Employees as individual and as a group
members will contribute their abilities and efforts for the achievement of organizational goals to
the extent that they perceive that it simultaneously results an advancement towards their own
individual and group goals. Without proper direction and supervision employees become
inactive, dull and inefficient and consequently the physical assets like machinery and plant will
be put to ineffective use.
Directing is the interpersonal aspects of managing by which subordinates are led to understand
and contribute effectively and efficiently to the attainment of enterprises objectives. Human
factor is very dynamic and is conditioned by a complex of forces about which not much is
known and over which management has little control.
From above we can say direction, is the heart of management process. Heart plays an important
role in a human body as it serves the function pumping blood to all parts of body which makes
the parts function. In the similar manner, direction helps the subordinates to perform in best of
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their abilities and that too in a healthy environment. The manager makes use of the four elements
of direction here so that work can be accomplished in a proper and right manner.

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