Professional Documents
Culture Documents
CHAPETR I
INTRODUCTION TO MANAGMENT: AN OVERVIEW
In this chapter the answers to questions like what is general management? Why is
management important? What do managers do? And the Development of General
Management theories will be briefly explained.
There is no single and comprehensive meaning and definition of management, because of the
various aspects of management, the perspective of the theorist and lack of clarity of concepts
and principles as the field is relatively young. The following meanings and definitions of
management are found to be important.
Meaning:
The word management has several meanings, the most important of which are:
a. Management refers to a group of people who are responsible for guiding and
controlling the organization (managerial personnel).
b. Management is the process of running an organization (planning, organizing, staffing,
directing/leading and controlling).
c. Management is a body of knowledge, a discipline.
__________________________________________________________________
1
CUEG5194 Construction Management
CEng5204 Lecture Note
Defining Management:
There are several definitions of management given by different authorities in the field:
a. Management is the art of getting things done through and with people in a formally
organized group.
b. Management is the process of coordinating all resources through the five major
functions of planning, organizing, staffing, directing/leading and controlling to
achieve organizational objective.
General Management is a broad area dealing with wider aspects of managing an ongoing
organization and it covers the following among other topics:
These aspects have developed over centuries conceptually and in the management Practice.
__________________________________________________________________
2
CUEG5194 Construction Management
CEng5204 Lecture Note
Early contributions: Most management thinkers in the 18th century classify management as
applicable to only business or industry related discipline. This indicates that the management
thought to the construction industry has been considered long ago. But historical evidences
show that people were more concerned with the management of organizations such as the state,
church, military, tribes, household, etc. These include:
Industrial era contributions: The movement of manufacturing to a factory system during the mid
1700s had significant contributions to management theories. This era is customarily called
industrial revolution era. In this era three major contributions can be identified, these are;
Human Resources Management, Scientific Management and Importance & initiatives for
Management Training.
__________________________________________________________________
3
CUEG5194 Construction Management
CEng5204 Lecture Note
operations. Babbage believed that management and employee interests were closely linked
to each other.
3. Management Training: Andrew Ure and Charles Duprin believed in management training
that they educate managers of many factories for offsetting factory systems problems.
Classical contributions: The classical contributions towards the management thoughts includes
two general features, these are Administrative theories, and Developed Scientific Management
concepts. The two major contributions are best represented by the work of Henri Fayol and
Fredric W. Taylor.
Henri Fayol (1841-1925) is known for the first general administrative theory developer of
management. He divided the whole task of the organization into operational and managerial.
The operational activities or functions include:
planning, coordination,
organizing, control.
command,
Fayol concentrated on the management theory and developed the first general theory of
management with the identification of fourteen basic principles:
__________________________________________________________________
4
CUEG5194 Construction Management
CEng5204 Lecture Note
Frederick W. Taylor (1856 - 1915) is father of Scientific Management and assumed that there is ''
One Best Way of Doing a Thing''.
Taylor is credited for the development of scientific management and outlined four principles:
1. Develop a science for each element of work, replacing the old rule of thumb,
2. Scientifically select and then train, teach and develop the workers,
3. Cooperate with the workers so as to insure all the work to be carried out in accordance with
the principles of the science that was developed, and
4. Provide equal division of work and responsibility to the management and the workers.
Classical contributions are also well known for its bureaucratic Management in addition to
Administrative Management. Prominent contributor in this field was Max Weber.
Max Weber (1846 1920) concerned with the how overall structure of an organization
influences managerial effectiveness, tried to look at the other administration types the likes of
administration by charisma and by tradition and concluded that bureaucracy is the best, ideal,
rational and legal administration mechanism.
Max Weber analyzed bureaucracy as the most logical and rational structure for large
organizations. Bureaucracies are founded on legal or rational authority which is based on law,
procedures, rules, and so on. Positional authority of a superior over a subordinate stems from
legal authority. Charismatic authority stems from the personal qualities of an individual.
__________________________________________________________________
5
CUEG5194 Construction Management
CEng5204 Lecture Note
Efficiency in bureaucracies comes from: (1.) clearly defined and specialized functions; (2.) use
of legal authority; (3.) hierarchical form; (4.) written rules and procedures; (5.) technically
trained bureaucrats; (6.) appointment to positions based on technical expertise; (7.)
promotions based on competence; (8.) clearly defined career paths. However it does mean
that bureaucracy has no problems. The main problems might be caused due to worshiping of
rules, sabotage of rules and red tape situations.
Abraham H. Maslow (1908-1970) theorized that people are driven by several needs, not just one
and developed a hierarchy of human needs. These are:
Physical needs are related to food, clothing and shelter. Safety needs include insurance, job
security, retirement benefits, etc. Social needs include the need to express themselves to associate
with others, etc. Ego needs involve the provision of status in the job. Self actualization can be
expressed by a phrase what a man can be he must be.
__________________________________________________________________
6
CEng5204
CUEG5194 Construction Management Lecture Note
On the other hand, Theory Y managers believe that all subordinates view work as rewarding if
given the chance by their superiors and implied that improved communications and greater
employee participation in decisions would be most desirable for the success of management.
way of some driving process. Systems are often visualized or modeled as component blocks
that have connections drawn between them. This management theory assumes the
organization as a system. Most systems share the same common characteristics. These
common characteristics include the following:
__________________________________________________________________
7
CUEG5194 Construction Management
CEng5204 Lecture Note
Environment
Political Economic
Inputs Outputs
Transformation
Process
Social
Technologic
al
Feed Back
The environment of a given organization can be classified as internal to the organization and
external to the organization. The internal environment renders the organization its strength
or weakness where as the external environment will provide a treat or an opportunity. SWOT
analysis is usually carried out to identify the Strengths, Weaknesses, Opportunities and
Threats of an organization.
Strengths and Weaknesses are internal factors that create value or destroy value. They can be
measured using internal assessments or external benchmarking. Opportunities and Threats
are external factors that again create value or destroy value. The organization cannot control
them. But they emerge from either the competitive dynamics of the industry/market or from
the economic, political, technical, social, legal or cultural factors (PEST). Table 1.1 below
indicates a SWOT analysis summary for a given prefab production company here in Addis
Ababa:
__________________________________________________________________
8
CUEG5194 Construction Management
CEng5204 Lecture Note
Strengths Weaknesses
Established facility Lack of marketing expertise
Abundant Space Lack of research and development unit
Skilled and Experienced Staff Low staff motivation
Acceptable reputation Need of erection equipments for
Location of Enterprise construction
Cost advantage Lack of ambition
Speed of Construction
Quality processes and products
Opportunities Threats
Highly Developing Market both public Competitors have a good standing in the
and private sector market
Mergers, joint ventures or strategic Lack of Information on the products and
alliances with other partners the system
Moving into new attractive market Psychological fear among customers
segments Globalization fierce competition from
Increasing need for speedy construction the Chinese Contractors
Increased cost of raw materials specially
cement
By using the Confrontation Matrix, which combines the internal factors with the external
factors the necessary strategies can be developed.
Opportunities Threats
Adjust
Strengths Offensive
Restore strengths
Make the most of these
Defensive Survive
Weaknesses
Watch competition closely Turn around
__________________________________________________________________
9
CUEG5194 Construction Management
CEng5204 Lecture Note
involve almost all industries and sectors in realizing their infra structural needs
use wide variety of resources and their scarcity
exhibit fierce competition nationally and globally
and the human, cultural and ecological aspects make their management complex, risk
undertaking, and working in an uncertain environment.
Due to this a number of recent contributions are being introduced. To state some: Total
quality management (TQM), Management by projects (MBP), Business process re-engineering
(BPR), Value engineering/ management (VE/ VM), and Concurrent engineering (CE).
1.3.1. Planning
PLANNING: Planning involves setting visions, missions and goals of organizations or projects or
programs together with the activities to achieve them. All levels of managers develop goals that
corresponds to the efforts of the top management overall goals and strategy. This requires
operational plan aimed at administration and coordination of Stakeholders, Processes and
__________________________________________________________________
10
CUEG5194 Construction Management
CEng5204 Lecture Note
1.3.2. Organizing
ORGANIZING: It is the process of arranging people and physical resources to carryout plans
and accomplishes organizational objectives. This helps how responsibilities of individuals who
are required to execute the works are defined and staffing and directing can be performed. Such
things can easily be shown by the use of Organization Chart. Organization makes sure the flow
of information resources and tasks logically and efficiently. Besides, the organization of sites,
specifically to construction, together with the physical resources is also considered as the part of
the organizing functions of management.
1.3.3. Implementing
IMPLEMENTING: It is the process where by the actual work is executed. This helps in
executing the task defined in the planning stage with proper organization system together with
monitoring quality, time and cost of the works. Proper inspection and supervision, recording
data of executed works, availing all necessary resources at the right place and at the right time
with their proper coordination are necessary to achieve the required goal efficiently and
successfully. The most important aspect in implementation of works is leading / directing.
Leading is the act of motivating or causing people to perform certain tasks intended to achieve
specified objectives. In general, it is the art of making things happen. Leading requires to
understand the dynamics of individual and group behaviors, motivation of employees, effective
visionary and effective communication capabilities.
__________________________________________________________________
11
CUEG5194 Construction Management
CEng5204 Lecture Note
future planning. Such things are done against the planned data with the help of communication
in the form of reporting, assessment and checking mechanism of any kind which is suitable for
the purpose of the executed works.
Effective management can take place when proper planning, organizing, implementing,
continuous communication, feed back for monitoring purpose and future planning are carried
out successfully.
According to widely known references, Henry Mintzberg brought forward ten most common
roles by managers and classified them into three managerial role categories: Interpersonal,
Informational and Decision Making Roles (Table 1.2).
Interpersonal Roles These roles are related to formal authority base of managers.
Figurehead Roles related to ceremonial in nature.
Leadership Roles related to ensuring achievement of goals.
Liaison Roles related to communication with internal and external stakeholders to
develop favorable relationships and networks.
Informational Roles These roles are related to availing sufficient information to carryout jobs
effectively. Because they are information centers for information and
communication source.
Monitor Roles related to scanning internal and external environments of their
organizations for selecting useful information.
Disseminator Roles related to sharing and distributing useful information to employees.
Spokesperson Roles related to information communications to external stakeholders.
Decision Roles These roles are related to processing information to reach conclusions.
Entrepreneur Roles related to initiating new developments.
Disturbance Handler Roles related to conflict resolution and problem solving.
Resources Allocator Roles related to distribution and assignment of different resources to
Negotiator projects.
Roles related to win comparative & competitive advantages to achieve goals.
__________________________________________________________________
12
CUEG5194 Construction Management
CEng5204 Lecture Note
Besides, recent trends enlarged managerial roles due to changed environments such as:
Globalization of markets
Increasing predominance of Entrepreneurial Firms
Growth in Service - based organizations
Increasing Diversity
New organizational Model, and
Increasing customer focus.
This has brought new competencies in the managerial roles. These are Effective
Communicator; Team Player; Technology Master for information age; Problem Solver;
Diplomat and politically astute; Change Maker and Promoter of Empowerment and
Delegatory roles.
Managers could be classified into different categories depending upon the scopes and levels of
management they are involved in. Depending on the nature and scope of the job managers
are performing, they can be classified under either functional or general managers. While
functional managers are responsible for a work group segmented according to functions;
general managers involve in managing several different functions or departments which are
responsible for different tasks. While Functional managers greatest challenge is lack of
communication skill; that of General Managers is technical skills.
Managers exist at various levels in the organizational hierarchy but are dependent on their
sizes and forms. That is, while small organizations may have only one, big ones several layers.
Generally speaking, a relatively large organization possesses three levels of managers: Top,
Middle and First line or Lower managers and could resemble pyramidal shape (Figure 1.1).
These levels of managers do perform certain job or level specific skills which are more
important to their respective levels.
__________________________________________________________________
13
CUEG5194 Construction Management
CEng5204 Lecture Notes
Conceptual Conceptual
Middle
Human
Management Conceptual
Human
Figure 1.1. Levels of Managment and Relative Importance of managerial skills at different
levels of management.
From the figure above, Technical skills are more important to lower management levels;
Human skills are more important to middle management levels and Conceptual skills are
more important to top management levels.
__________________________________________________________________
14