What is a business

A business enterprise is created and managed by people. It is not managed by forces. Economic forces set limits to what management can do. They create opportunities for managements action. But they, by themselves, do not determine what a business is or what it does. Secondly a business cannot be defined or explained in terms of profit. Economic theory makes a fundamental assumption that maximising profits is the basic objective of every firm. But in recent years profit maximisation has been extensively qualified by theorists to refer to the long run; to refer to managements rather than to owners income; to include non-financial income such as increased leisure for highstrung executives and more congenial relations between executive levels within the firm. This does not mean that profit and profitability are unimportant. It does mean that profitability is not the purpose of business enterprise and business activity, but a limiting factor on it. Profit is not the explanation, cause or rationale of business behaviour and business decisions, but the test of their validity. The problem of any business is not the maximisation of profit but the achievement of sufficient profit to cover the risks of economic activity and thus to avoid loss.

General Mgmt. 2
The purpose of a business

To know what a business is, we have to start with its purpose. And its purpose must lie outside of the business itself. In fact, it must lie in society since a business enterprise is an organ of society. There is only one valid definition of business purpose: to create a customer. Markets are not created by God, nature or economic forces but by businessmen. The want they satisfy may have been felt by the customer before he was offered the means of satisfying it. It may indeed, like the want for food in a famine, have dominated the customers life and filled all his waking moments. But it was a theoretical want before; only when the action of businessmen makes it effective demand is there a customer, a market. It may have been an unfelt want. There may have been no want at all until business action created it by advertising, by salesmanship, or by inventing something new. In every case it is business action that creates the customer. It is the customer who determines what a business is. For it is the customer, and he alone, who through being willing to pay for a good or for a service, converts economic resources into wealth, things into goods. What the business thinks it produces is no of first importance especially not to the future of the business and to its success.

General Mgmt. 3

What the customer thinks he is buying, what he considers value, is decisive it determines what a business is, what it produces and whether it will prosper. The customer is the foundation of a business and keeps it in existence. He alone gives employment. And it is to supply the consumer that society entrusts wealth-producing resources to the business enterprise. The two entrepreneurial functions Because it is its purpose to create a customer, any business enterprise has two and only these two basic functions : Marketing and Innovation. are the entrepreneurial functions. Marketing is the distinguishing, the unique function of the business. A business is set apart from all other Neither Church nor Army, nor Any organisation that human organisations by the fact that it markets a product or a service. school, nor State does that. a business. They

fulfils itself through marketing a product or a service, is Any organisation in which marketing is either absent or incidental is not a business and should never be run as if it were one.

Marketing is not only much broader than selling, it is not a specialised activity at all. point of view of its final result, It encompasses the that is from the entire business. It is the whole business seen from the customers point of view. Concern and responsibility for marketing must therefore permeate all areas of the enterprise.
General Mgmt. 4

A business enterprise can exist only in an expanding economy, or at least in one which considers change both natural and desirable. And business is the specific organ of growth, expansion and change. The second function of a business is therefore innovation, that is, the provision of better and more economic goods and services. It is not enough for the business to provide just any economic goods and services; it must provide better and more economic ones. It is not necessary for a business to grow bigger; but it is necessary that it constantly grow better. Innovation goes right through all phases of business. It may be innovation in design, in product, in marketing techniques. It may be innovation in price or in service to the customer. It may be innovation in management organisation or in management methods.

Every other managerial unit of the business should also have clear responsibility and definite goals for innovation. It should be responsible for its contribution to innovation in the companys product or service; and it should in addition strive consciously and with direction toward advancement of the art in the particular area in which it is engaged: selling of accounting, quality control or personnel management.
General Mgmt. 5

Definition of management: Its nature & purpose Management is the process of designing and maintaining an environment in which individuals, working together in groups, efficiently accomplish selected aims. 1. As managers, people carry out the managerial functions of planning, organising, staffing, leading, and controlling. 2. Management applies to any kind of organisation 3. It applies to managers at all organisational levels. 4. The aim of all managers is the same : to create a surplus. 5. Managing is concerned with productivity; this implies effectiveness and efficiency.
Managerial skills

Technical skill Human skill Conceptual skill

 Design skill The functions of managers Planning Organising Staffing Leading Controlling

General Mgmt. 6

Planning Planning involves selecting missions and objectives and the actions to achieve them; it requires decision making, that is, choosing future courses of action from among alternatives. Types of plans: There are a number of different types of plans that often cause difficulty in making planning effective. In fact, a plan can encompass any course of future action, which clearly shows that plans are varied. They are classified here as: 1. 2. 3. 4. 5. 6. 7. Purposes or missions Objectives Strategies Policies Procedures Rules Programs

8.

Budgets.

The planning process: Decision making may be the easiest part of planning, although in involves techniques of evaluation and considerable skill in applying them. The real difficulties arise primarily in sharpening and giving meaning to objectives and critical premises, seeing the nature and relationships of the strengths and weaknesses of alternatives, and communicating goals and premises to those throughout the enterprise who must plan.
General Mgmt. 7

Organising Organising is that part of managing that involves establishing an intentional structure of roles for people to fill in an organisation. It is intentional in the sense of making sure that all the tasks necessary to accomplish goals are assigned and, it is hoped, assigned to people who can do them best. Types of Organisations Formal organisation : The intentional structure of roles. Flexible by nature. Room for discretion. Advantageous utilisation of creative talents. Recognition to individual capacities.

Group effort toward group and organisation goals.

Informal organisation : Any joint personal activity. Lack of concious joint purpose. Contribution to joint results. Informal relationships. Consultation from any department about organisation problem.

General Mgmt. 8

Staffing Staffing involves filling and keeping filled, the positions in the organisation structure. This includes identifying work-force requirements, inventorying the people available, and recruiting, selecting, placing, promoting, appraising, planning the careers of, compensating, and training or otherwise developing both candidates and current jobholders to accomplish their task effectively and efficiently. It is clear that staffing must be closely linked to organising, that is, to the setting up of intentional structures of roles and positions. The number of managers needed in an enterprise depends not only upon its size but also upon the complexity of the organisation structure, the plans for expansion, and the rate of turnover of

managerial personnel. The ration between the number of managers and the number of employees does not follow any law. The actual process of staffing is affected by many environmental factors. Specifically, external factors include the level of education, the prevailing attitude in society, the laws and regulations that directly affect staffing, the economic conditions, and the supply of and demand for managers outside the enterprise. internal factors that affect staffing. There are also many They include, for example,

organisational goals, tasks, technology, organisation structure, the reward system and various kinds of policies.
General Mgmt. 9

Leading
Leading is the influencing of people so that they will contribute to organisation and group goals; it has to do predominantly with the interpersonal aspect of managing. All managers would agree that their most important problems arise from people their desires and attitudes, their behaviour as individuals and in groups and that effective managers also need to be effective leaders. Understanding the human factor in enterprises is important for the managerial function of leading. How a manager views human nature A influences the selection of motivational and leadership approaches.

number of models presenting various conceptions of the nature of people have been proposed; however, no single view is sufficient to understand the whole person. suggested. People do not work in isolation; rather, they work to a great extent in groups towards the achievement of personal and enterprise objectives. Therefore, an eclectic view of the nature of people is

Unfortunately, these objectives are not always harmonious. Likewise the goals of subordinates are not always the same as those of the superior. Therefore, one of the most important activities of managers is to harmonize the needs of individuals with the demands of the enterprise.

General Mgmt. 10

Controlling
Controlling is the measuring and correcting of activities of subordinates to ensure that events conform to plans. It measures performance against goals and plans, shows where negative deviations exist, and, by putting in motion actions to correct deviation, helps ensure accomplishment of plans. Control activities generally relate to the measurement of achievement. Some means of controlling, like the budget for expense, inspection records and the record of labour hours lost, are generally familiar. and each shows whether plans are working out. correction is indicated. The basic control process, wherever, it is found and whatever is being controlled, involves three steps : Each measures If deviations persist,

1. Establishing Standards 2. Measuring performance against these standards. 3. Correcting variations from standards and plans. In practice, standards tend to be of the following types : 1. 2. 3. 4. 5. 6. Physical Standards Cost Standards Capital Standards Revenue Standards Program Standards Intangible Standards

To be effective, controls should be designed to point up exceptions at critical points, to be objective, to flexible, to fit the organisational climate, to be economical, and to lead to corrective action.
Delegation 1

Delegation
Delegation means that a Task/Function is committed to a person by someone in authority together with the necessary power to carry it out.

Features in Delegation Effective tool in the hands of a manager/supervisor if systematically. It is ultimately the managers responsibility but the power to do the job is passed on to someone else. Gives subordinates the attitude to make decisions about the way to reach results. Specific responsibility passed to a subordinate which can be handled by the superior. Making subordinates accountable for results. Goal oriented. It does not mean Dump a job onto your subordinates lap and walk away. Shed your ultimate responsibility for completing the job. Become unaccountable for results. used

Delegation 2

Delegation Process Briefing the delegates Specify the essential parameters Explain the desired outcome. Allow them freedom to decide how to perform the task Check they understand what is required Be enthusiastic. Be realistic about your expectations Indicate the need for progress reports, intermediate deadlines and that the needs of all are served if you are kept closely informed. Discuss which areas of the task are sensitive to error or risk.
Monitoring progress

Allow the delegates to proceed with the task without interference. Encourage delegates to follow their own way of working if you are sure you are agreed on the desired result. Be alert for signs that things are going wrong, but be prepared to allow trivial mistakes to be made. Intervene only if delegates do not spot their errors or where sensitive areas are threatened. Be ready with help, advice and encouragement, but avoid doing the task yourself. circumstances. Transfer the delegation only in extreme

Delegation 3

Encourage frequent informal discussion rather than formal feedback. Stand back from the process and retain a view of the bigger picture.
Evaluation & Feedback Did the task produce the results you expected ? If it was successful, say so. Give praise, recognition and credit to the people involved. Do not blame your delegates in public, to your boss or colleagues, but accept the responsibility yourself. Understand the differences A) Delegation of Responsibility V/s Delegation of Authority

Delegation of Responsibility Delegation is a process of passing on responsibility, yet delegation never relieves you of responsibility. Transferring on responsibility means making your subordinate accountable to you for results. Delegation is a method of fulfilling your responsibilities to somebody else not avoiding them.

Delegation 4

Delegation of Authority Authority is a resource that you make available to your subordinate - keeping in focus the result. In delegation, you might have to pass along the authority to spend money, or to give orders, or to make use of company property etc. needed to

complete the task.

B. Doing V/s Managing

Doing This means directly accomplishing results. It includes operating a machine or pushing a broom writing a legal brief making an engineering drawing closing a sale Managing This involves two aspects - Planning & Directing. In planning, you are not directly involved in the work but influence it from a distance. Such as : gic planning Strate

 ng a marketing campaign g out financial tactics

Devisi Layin
Delegation 5

In directing you are directly involved in supervising work. Such as : ing g instructions ng meetings Almost all managers / supervisors handle tasks at each of these levels. in.

Coach Givin Holdi

But the higher a manager / supervisor moves in the

organisation, the less doing and the more planning he or she engages You The

must eliminate the doing aspects of your job by delegating them.

more doing you can pass on to subordinates, the better you will manage. Why Should You Delegate ? Positive Results of Delegation

 Multiplies your Productivity Gives you time. Eliminates detailed work (Trivial) Develops management abilities Promotes organisation efficiency Shifts decision making to the appropriate level
Delegation 6

Facilitates decentralisation and diversification.

Provides variety and novelty

Subordinates Learn New Skills Improves evaluation of peoples potential

What Jobs To Delegate ?

Routine Necessary Trivial Specialty Jobs Chores Pet projects

What Jobs Not To Delegate? The slogan Delegate Everything warning Except............. has to be followed by the

 Ritual

Policy making

Specific personnel matters like evaluation, discipline, praise, resolution of disputes and delegation itself.

Handling crises Confidential matters

Delegation 7

Whom To Delegate ?
This calls for assessing your subordinates capabilities; picking your own goals for delegating; considering workloads, skills, and experience; knowing your companys internal politics; and how much weight you should give to the direct results that you want to achieve. Know your people : You cannot delegate effectively if you select the delegatee arbitrarily. And you cannot delegate effectively if you have only a superficial knowledge of your subordinates. Whats your goal? : Delegation has three general goals. which are the most important for this task. Direct results : When you delegate to a subordinate the compilation of an inventory report, for example, the main thing youre interested in is a list of figures. For most cases of delegation, the direct result is the most important goal. In choosing the right delegatee, you have to weigh these goals to decide

Development : When you delegate the task do consider if your are contributing towards the experience and development of your subordinate. Evaluation : It should be clear to you that your subordinates will sooner or later have to be tested under fire. In some delegations your main goal will be to see how the person performs in a given situation. But still, you dont delegate with the expectation of failure.
Delegation 8

Current work load : Whether a subordinate can handle a new task without it interfering with his current duties should always be considered when you choose a delegatee. Not only is it unfair to add to the work of an already burdened subordinate, but it invites poor performance in either the primary duties or the delegated task, or both. Skills required : When selecting the delegatee, ask yourself, Does this task require special skills or knowledge? If so, those skills should be a primary criterion for guiding your selection. Naturally, a person should pick up new skills in the process of completing the task. Independent experience : Experience differs from skills or knowledge. Recent Business Administration Graduates may have analytical skills and theoretical knowledge. But they need experience to teach them how to motivate others and how to exercise authority effectively before they can be assigned the task of managing an operation.

Personal qualities : An ability to work with people is often an important personal qualification for successful completion of a delegated job, duty, or task. Company politics : You can never neglect company politics when delegating. Social factors play an important role in the functioning of any organisation.

Delegation 9

Special delegations : Some special tasks will lead you to select either an expert of a personal assistant as the delegatee. When you delegate to a personal secretary, an administrative assistant, or anyone else who closely works with you, you should be careful so as not to take delegation for granted, be sure of the qualifications/ experience etc. How Should You Delegate ? Be Clear of the Result Keep it Time bound Don't half-delegate resources Dont delegate half a task Advice and direct subordinates for complex tasks
Stress the delegatees accountability

Have a dialogue discussing the project Elicit acceptance from your subordinate

 Give credit to the delegatees efforts Boost the delegatees Enthusiasm for the task Prioritise delegated work Follow-up on the delegated task Back the subordinate up

Delegation 10
Delegation dos and donts

To sum up the process of delegation, here are the 10 most important dos and donts to keep in mind when delegating : Do Encourage the free flow of information to your subordinates. Focus on results. Delegate through dialogue. Fix firm deadlines Make sure the person has all necessary resources Delegate the entire task to one person. Dont Hoard information. Emphasise methods. Do all the talking yourself. Leave time scales uncertain. Half-delegate by giving assignments without the needed tools. Delegate half a task.

 Give advice without interfering. Build controls into the process of delegating Back up delegatees in legitimate disputes. Give the delegatee full credit for his or her accomplishments.

Fail to point out pitfalls Impose controls as an afterthought. Leave people to fight their own battles. Hog the glory or look for scapegoats.

Reading Material For Private Circulation Only

Contents Pg. No.

The purpose of a business.....................................................................2 Business Environment: Managing Expectations and Work Review.....22 Functions of a Manager.......................................................................26 Dimensions of Managerial Effectiveness.............................................27 Managerial Roles................................................................................. 32 Psychological Factors in Managerial Effectiveness.............................38

Managerial Problem Analysis and Decision Making............................43 Problem Solving v/s Decision Making..................................................47

Business

Environment: Review

Managing

Expectations

and

Work

Welcome to Nomads Land, where professional tribes with no permanent abode wander from organization to organization. The only permanent occupation for all of us will be getting ready for the coming battles undefined. Organisations like glass prisms will be transparent, quickly changing the direction and shape of anything passing through them, resisting discipline, and reflecting and refracting light, energy, talent and wisdom into a spectrum of colorful hues.

Expectations in the New Environment Everyone wants to land up with and keep a meaningful job that fairly rewards diligence, discipline, and good work. The obvious question becomes: What are the prospects of doing so? Whatever the title downsizing, rightsizing, or derecruiting staff cutbacks continue to be the corporate worlds tool of choice for becoming competitive. The key survival mode is positive projection: learning to look beyond the horizon with an optimistic perspective. Just as there are great threats in the current and future organizational climates, there are also exciting possibilities and opportunities. Some things are predictable; some trends can be easily spotted and reliably extended into the future. For example, the trend towards flattening organizations will continue. Who could have predicted the fall of the Berlin Wall, the unification of Germany, the breakup of the former Soviet Union, or the advent of a powerful three-pound notebook computer selling for less than a refrigerator? These events have had enormous ramifications for business in the global village. The trick is that you have to get ready for the twenty-first century organization that has not yet been invented. It will be shaped by two forces: some startling and unpredictable events and some things that you already know are happening. You must view every threat as an opportunity. Every technological advancement brings the promise of a higher standard of living. Consider this When he runs out of milk, he tells his refrigerator by tapping the keys on its door. The machine, made by Whirlpool, contacts online Shiv Dairy and gets a fresh one litre of milk delivered to his doors. He recently sent an email because he had spilled some Dal on his tie. The washer downloaded a special pesto-on-silk cleaning program from Whirlpools smart product website. The washer knew what cycle time; agitation level, water temperature and soap were needed to get rid of the spot. In the shrinking global village companies may have R&D in Silicon Valley, Engineering in India, Manufacturing in China, Customer support in Ireland, Sales across the globe. This is a Net wired world. Are you ready to face it? You have to get ready for the twenty-first century organization that has not yet been invented. Doing nothing is just not a wise option. Get ready now. No one knows exactly what tomorrows workplace will look like what your job will require, how your organization will be shaped. One thing is certain: Whatever the game turns out to be, you must be able to play it well. Just remember change is learning, and in the 21st century, you will have more opportunities to learn than you ever dreamed of. The first rule that Jack Welch, the CEO of General Electric, lives by is Control your destiny or someone else will!

Frank Ogden, the noted world futurist, has suggested that the single most important employee trait in the next century will be attitude. He believes that your predisposition toward change, adventure and risk will determine your success in the next century. He has suggested that recruiters will hire and organizations will promote on the basis of workers adaptability quotient, rather than their intelligence quotient. What you already know: Most of what managers traditionally do is now obsolete (i.e. acting as gatekeeper and information processor), thanks to the computer. The de-structuring and de-organisation is well under way, leading to flatter organizational structures. Businesses have begun to micro market, realizing that any product draws different responses from different types of customers. Structures have become more organic and less rigid (e.g. temporary project and product teams). You must work even harder to stay in the same place, and if you want to get anywhere, you must run twice as fast! Outsourcing is the resource of choice. Employee participation by everyone in everything is becoming the norm, rather than the exception. In the global village, everything you do is affected by the shock waves of world events. Anyone, anywhere, is a potential competitor and customer. Workforce diversity is increasing. What you may more dimly see: In the information age, place loses its meaning as a defining work variable. Work will be whenever the hard drive is. Organisations wont be buildings and land; they will be ideas, concepts, and networks. Work, home, and recreation may all occur in the same location. Work will give way to connectedness. In the wired world, your future challenge will be to manage selection and training, development, careers, expectations, and performance as measured by customer satisfaction. Every piece of new technology creates some new jobs, kills some old jobs, and, more important, upsets some old organizational processes. Work mirrors life. Like society, organizations are becoming more violent. Every day some CEO announces the coming dismissal of thousands of workers. The information-age is very much dissimilar to the industrial-age. Organisational Shifts

Old Paradigms Stability Predictability Continuity Hierarchy Hiring Seniority an asset Management 9-5 work schedule

New Paradigms Change Uncertainty Flexibility Empowerment Outsourcing Seniority a liability Leadership Teleworking & telecommuting

Work / Performance Review Performance Reviews enable a perspective to be obtained on past performance as a basis for making plans for the future. Managers should take an overall view of the progress made. Examples should be used to illustrate that overview, and the analysis of performance concentrates not only on what has happened but also on why it has happened so that data are obtained for planning purposes. Obtaining a historical perspective through analysis is a necessary part of a performance review but reaching agreement about what should be done in the future is what the discussion should be about. Performance reviews provide those involved with the opportunity to reflect on past performance as a basis for making development and improvement plans. The purpose of performance review is to enable those concerned to get together so that they can engage in a dialogue about the individuals performance and support can be provided if need be. A performance review should be regarded as a conversation with a purpose and it should be like a free-flowing, open meeting where views can be exchanged. Guidelines for a constructive performance review: Encourage subordinates to do most of the talking Listen actively to what they say Allow scope for reflection and analysis Analyse performance, not personality Keep the whole period on review, not concentrating on isolated or recent events Adopt a no surprises approach performance problems should have been identified and dealt with at the time they occurred Recognize achievements and reinforce strengths One important function the 21st Century manager has to play is managing performance. Performance management is concerned with improving individual and team performance. It should be a continuous self-renewing cycle. Performance review is a continuous process of monitoring

performance by giving feedback on performance, conducting informal progress reviews. The main activities involved are: Role definition, in which the key result areas and competence requirements are to be defined The performance agreement, which defines expectations. Both the manager and his subordinate have an important role to play in this whereby an agreed set of results to be achieved are charted through mutual discussions. The personal development plan sets out the actions managers intend to take to develop themselves in order to extend their knowledge and skills, increase their levels of competence and improve their performance in specified areas. Managing performance throughout the year, which includes a continuous process of providing feedback in performance.

Functions of a Manager
The successful manager capably performs four basic managerial functions: planning organizing, leading, and controlling. However, as you will see, the amount of time a manager spends on each function depends on the level of the particular job. After further describing each of the four general managerial functions, we will highlight the differences among managers at various levels in organizations. Regardless of their level, most managers perform the four general functions more or less simultaneously-rather than in a rigid, preset order-to achieve organizational goals. Planning. In general, planning involves defining organization goals and proposing ways to reach them. Managers plan for three reasons: (1) To establish an overall direction for the organizations future, such as increased profit, expanded market share, and social responsibility; (2) To identify and commit the organizations resources to achieving its goals; and (3) To decide which tasks must be done to reach those goals. Jeff Bezos is a good example of a manager who plans. Through his research, he understood how important the Internet is, which products could be sold over the Internet, what channels of distribution would be needed to deliver products to customers, and how important motivated employees are. In other words, he had a good understanding of what planning involves. Organizing. After managers have prepared plans, they must translate those relatively abstract ideas into reality. Sound organization is essential to this effort. Organizing is the process of creating a structure of relationships that will enable employees to carry out managements plans and meet organizational goals. By organizing effectively, managers can

better coordinate human, material, and information resources. An organizations success depends largely on managements ability to utilize those resources efficiently and effectively. Organizing involves creating a structure by setting up departments and job descriptions. Leading. After management has made plans, created a structure, and hired the right personnel, someone must lead the organization. Leading involves getting others to perform the tasks necessary to achieve the organizations goals. Leading isnt done only after planning and organizing end; it is a crucial element of those functions. Controlling. The process by which a person, group or organization consciously monitors performance and takes corrective action is called controlling. Just as a thermostat sends signals to a heating system that the room temperature is too high or too low, so a management control system sends signals to managers that things arent working out as planned and that corrective action is needed. In the control process managers Set standards of performance, Measure current performance against those standards, Take action to correct any deviations, and Adjust the standards if necessary.

The Functions of Manager

Organizing Planning Directin g Controlling

Dimensions of Managerial Effectiveness

There is only one realistic and unambiguous definition of managerial effectiveness: effectiveness is the extent to which a manager achieves the output requirements of the position. The concept of managerial

effectiveness is the central issue in management. The managers job the only job is to be effective. Skills, theories, and roadmaps come and go. A primary survival capability of the future will be the ability to cast off what you have learned. For managers, changing environment offers many new challenges and opportunities. Managers are increasingly being asked to become generalists who step outside of traditional narrowly defined job descriptions in support of team objectives and goals. These changes are resulting in the development of new approaches to management. In this organization, continuous learning is a prerequisite to successful job performance and organizational effectiveness. Employees must be able to learn work, develop effective technical and people skills in order to assume new responsibilities, and keep pace with and anticipate the changing nature of work and the workplace. For managers and other employees alike, responding to these changes requires the ability to learn, adapt to change, solve problems creatively, and communicate effectively in diverse groups. In addition, they must take personal and proactive responsibility for their careers to ensure future employability and advancement. In the new environment there is need to focus on decision-making and accountability at the level where the work is done, development of a service culture that rewards team performance, and integration of operations. Critical to the success of this new model is the adoption of a customer service orientation, a flexible attitude in the face of constant change. The realities of the contemporary workplace will continue to challenge existing paradigms and should be considered in managing the performance of employees in a dynamic working environment.

With the disappearance of reliable management theories, it is very difficult to predict which characteristics will be critical to being an effective manager in the 21st Century. However there are some important traits that are important determinants of managerial effectiveness: Adaptability Change elicits a natural resistance, but the ability to accept and even embrace the alterations that will continue to occur will be prized. The ability to adjust your perspective, approach, and behaviour to new paradigms will become more important to successful employment, and

employees who cannot or will not make the needed transitions will quickly become second-class managers. Appreciation of ambiguity In the 21st Century, the ability to deal with unstructured, untested parameters and to arrive at satisfactory conclusions is necessary. Some people hate ambiguity; others love it. Whatever your predisposition, your best interests dictate that you learn to appreciate and deal with a lack of structure. Those who can successfully cope with ambiguity will prosper. Managers who cant or wont, will be left in the dust. You must learn to see structure where none exists and to create it out of swirling events. Accommodation Working effectively in the future will require participating in more and more intragroup and intergroup activities. Solo decision making is becoming less of an organizational reality. Learning the group and interpersonal leadership skills needed to assemble the right group and to value different cultural, functional, and organizational interests will be invaluable. Accomplishment Bang for the buck. The organizations of tomorrow will be even more achievement oriented than today companies. Perform or Perish! Getting things done will be the way of the world, and figuring out how to make a contribution and improve the way things work will be one of your passports to success. As telecommuting removes some people from the traditional workplace, people will be judged more on performance achievements than on style; keeping their level of performance high, year after year, will be the minimum for survival. What have you done for me recently? Is an enduring motto for the future. Performance appraisals will have short memories. Access ability Getting information that your people need to reach the goals will be of increasing value. Clarity derives from accurate information, including a full expression of feelings. Extracting information that counts from the everexpanding highway of data will enable your people to use their limited time well. Expanding your knowledge of personal and computer networks is extremely important. In the years ahead, you will have to know what you need, where to look for it, and how to retrieve it.

Accessibility

You must be available to your people. Accessibility translates into frequent and effective group experiences (meetings, training, presentations etc.) as well as intensive one-on-one time. The natural pressure of business encourages managers to distance themselves from their people. This separation will have negative consequences. Accessibility is more than an open door policy. You must seek out your people. Help them get what they need. Provide support, information, and resources, shield them, and share with them. These attitudes and orientations will allow you to take in information, make adjustments, learn new ways and move on in this great adventure. Three kinds of effectiveness The idea of managerial effectiveness can be clearly understood when managers learn to distinguish sharply between: Managerial effectiveness Apparent effectiveness Personal effectiveness Managerial Effectiveness Managerial effectiveness is not an aspect of personality. It is not something a manager has. Effectiveness is best seen as something a manager produces from a situation by managing it appropriately. It represents output, not input. The manager must think in terms of performance, not personality. It is not so much what a manager does, but what is achieved. Once managers have decided they want to become effective they should initially focus on how they can contribute more, or contribute more effectively, than they are doing now. Some managers have narrow views of their jobs. What they do, they may do well, but what they leave undone is enormous. Managerial effectiveness can seldom be obtained by achieving a single objective, no matter how broadly it is written. Profit, for instance, may be obtained at the risk of losing customers or by sacrificing human resources. Any manager who sees the effectiveness criteria in simple black-and-white terms may perform well in the short run, but may not in the long run. Effectiveness is multidimensional. Before managers can operate with full effectiveness they must: Understand the overall contribution the unit should make, which means knowing what the team top member is responsible for. Understand their role in the unit, which means knowing what they are responsible for achieving and knowing what the team member thinks is a good job. Establish specific objectives, which they intend to achieve in a determined time period. Have the help of the teams top member in overcoming obstacles, which may prevent the attainment of these objectives. These obstacles may

lie in the organization, the job, the team member or the managers themselves. Have the willingness to work to achieve the objectives, which may mean preparedness to change the behavior. Receive concrete periodic feedback on the progress towards their objectives. Receive help and guidance when needed. Be held responsible for their actions over the longer term.

If any of these are missing, full effectiveness is unlikely to occur. A well designed organization usually ensures that managerial effectiveness, and only managerial effectiveness, leads to personal rewards. While organizations do vary in the extent, speed, and adequacy of rewards for effectiveness, there can be little doubt that in the long run, the effective manager is the rewarded one. Apparent effectiveness It is difficult, if not impossible, to judge managerial effectiveness by observation of behavior alone. The behavior must be evaluated in terms of whether or not it is appropriate to the output requirements of the job. Conventional job descriptions often lead to an emphasis on what could be called managerial efficiency, the ratio of output to input. The problem with this is that even if both input and output are low, efficiency could still be 100 per cent. In fact, a manager or department could easily be 100 per cent efficient yet 0 per cent effective. The efficient manager is easily identified, as one preferring to : Do things right Solve problems Safeguard resources Discharge duties Rather than Rather than Rather than Rather than Do right things Produce creative alternatives Optimize resource utilization Obtain results

Conventional job descriptions lead to the kind of thinking on the left; job effectiveness descriptions lead to that shown on the right. Conventional job descriptions and, for that matter, management audits, usually focus on the internal efficiency of an organizational system rather than its external effectiveness or its output. It would be a simple matter to increase internal efficiency sharply and to decrease external effectiveness just as sharply. Paper work is usually quite unrelated to effectiveness. Personal Effectiveness

Poorly defined job outputs can also lead to what might be called personal effectiveness that is, the satisfying of personal objectives rather than the objectives of the organization. This is particularly likely to occur with ambitious people in an organization, which has only a few clearly defined management output measures. Meetings with these people are riddle with hidden agendas, which operate below the surface and lead to poor decision making.

Managerial Roles
Mintzbergs Ten Managerial Roles After reviewing earlier studies of managerial activities, Mintzberg (1973) came to the conclusion that the studies failed to provide much insight into what a manager does. The focus of these studies was usually on activities defined at a concrete level rather than in terms of activities content. The few studies that examined activity content used predetermined content categories that provide only an incomplete picture or a managers job. Mintzberg conducted a study designed to overcome these limitations. He used unstructured observation and developed new content categories during and after the initial observations. The meaning of the activities was interpreted by identifying a set of ten underlying managerial roles that accounted for all of the activities observed by Mintzberg. Each activity can be explained in terms of at least one role, although many activities involved more than one of the ten roles. Three of the managerial roles (figurehead, leader, liaison) deal with interpersonal behaviour. Three other roles (monitor, disseminator, spokesman) deal with information processing behaviour. The remaining four roles (entrepreneur, disturbance handler, resource allocator, negotiator) deal with the decision-making behaviour of managers. All of the roles are relevant for any manager or administrator, although their relative importance may very from one kind of manager to

another. A managers roles are largely predetermined for him by the nature of his position, but he can interpret them in different ways while carrying them out. Each of the roles will be described briefly. The ten roles are divided into three groups: interpersonal, informational, and decisional. The informational roles link all managerial work together. The interpersonal roles ensure that information is provided. The decisional roles make significant use of the information. The performance of managerial roles and the requirements of these roles can be played at different times by the same manager and to different degrees depending on the level and function of management. The ten roles are described individually, but they form an integrated whole. 1. Figurehead Role As a consequence of their formal authority as the head of an organisation or one of its subunits, managers are obliged to perform certain symbolic duties of a legal and social nature. These duties include signing documents (e.g. : contracts, expense authorisations), presiding at certain meetings and ceremonial events (e.g. : retirement dinner for a subordinate), participating in other rituals or ceremonies, & receiving official visitors. The manager must participate in these activities even though they are usually of marginal relevance to the job of managing. 2. Leader Role Managers are responsible for making their organisational sub-unit function as an integrated whole in the pursuit of its basic purpose. Consequently, the manager must provide guidance to subordinates, insure that they are motivated and create favourable conditions for doing the work. A number of managerial activities are expressly concerned with the leader role, including hiring, training, directing, praising, promoting, criticising, and dismissing. However, the leader role pervades all of a managers activities, even those with some other basic purpose. 3. Liaison Role The liaison role includes behaviour intended to establish and maintain a web of relationships with persona in groups outside of a managers organisational subunit. These relationships are vital as a source of information and favours. Development of such contacts and relationships is part of a chief executives responsibility for linking his organisation to the external environment. Horizontal relationships are also essential for middle and lower-level managers in order to obtain information and provide some influence over suppliers, clients service units & regulators. The essence of the liaison role is in making new contacts keeping in touch and doing favours that will allow the manager to ask for favours in return. Some examples of activities involving the liaison role include

attending social events or professional conferences, joining outside boards, clubs or associations, writing to congratulate a colleague, and calling another manager to provide some helpful information or offer assistance. 4. Monitor Role Managers continually seek information from a variety of sources. Some examples of activities with this purpose include reading reports and memos, attending meetings and briefings, and conducting observational tours. Some of the information obtained is passed on to subordinates (disseminator role) or to outsiders (spokesman role). Most of the information is analysed to discover problems and opportunities and to develop an understanding of outside events and of the internal processes within the managers organisational subunit. 5. Disseminator Role Managers have special access to sources of information not available to subordinates. Some of this information is factual in nature, and some of it concerns the stated preferences of individuals & organisations desiring to influence the manager, including persons at high levels of authority. Some of the factual information must be passed on to subordinates, either in its original form or after interpretation and editing by the manager. The information about preferences must be assimilated according to the influence of the source, and it is then expressed to subordinates either in the form of value statement (e.g. : rules, goals, policies, standards) or as specific responses to subordinates questions. 6. Spokesman Role Managers are obliged to transmit information and express value statements to persons outside their organisational subunit as well as to subordinates. Middle- and lower-level managers must report to their superiors: a Chief Executive must report to his Board of Directors. Each of these managers is also expected to serve as a lobbist and public relations representative for his organisational subunit when dealing with superiors and persons outside of the organisation (eg. suppliers, clients, government agencies, the press). As Mintzberg points out, To speak effectively for his organisation and to gain the respect of outsiders, the manager must demonstrate and up-to-the-minute knowledge of his organisation and its environment.

7.

Entrepreneur Role

The manager of an organisation or one of its subunits acts as an initiator and designer of controlled change to exploit opportunities for improving the existing situation. Such change takes place in the form of improvement projects such as development of a new product, purchase of new equipment, or reorganisation of formal structure. Some of the improvement projects are supervised directly by the manager, and some are delegated to subordinates. Mintzberg offers the following descriptions of the way a manager deals with improvement projects: The manager as a supervisor of improvement projects may be likened to a juggler. At any one point of time he has a number of balls in the air. Periodically, one comes down, receives a short burst of energy, and goes up again. Meanwhile, new balls wait on the sidelines and, at random intervals, old balls are discarded and new ones added. 8. Disturbance Handler Role The crisis are caused by unforeseen events such as conflict among subordinates, the loss of a key subordinate, a fire or accident, a strike, and so on. A manager typically gives this role priority over all of the others. Since managers usually spend much of their time reacting to sudden disturbances, little time is left for reflective planning or general strategy formation. 9. Resource Allocator Role Managers exercise their authority to allocate resources such as money, manpower, materials, equipment, facilities, and services. Resources allocation is involved in managerial decisions about what decisions, in the preparation of budgets, and in the managers scheduling of his own time. By retaining the power to allocate resources, the manager maintains control over strategy formation and acts to coordinate and integrate subordinate actions in support of strategic objectives. 10. Negotiator Role Any negotiations requiring a substantial commitment of resources will be facilitated by the presence of a manager having the authority to make this commitment. The manager may also aid negotiations by serving as an expert spokesman for his organisational subunit. Finally, the managers participation as the figurehead for his subunit adds credibility to the negotiations. Thus, when a manager services as a chief representative of his unit during negotiations, his activities are likely to involve the resource allocator, spokesman, and figurehead roles in addition to the negotiator role. A chief executive is likely to participate in several different types of negotiations, including labour-management negotiations with unions, contract negotiations with important customers, suppliers, or consultants, employment negotiations with key personnel, and other non-routine negotiations (e.g.: acquisition of another firm, application for a larger loan). Middle-level and lower-level managers also perform a negotiator role.

The Managerial Roles

Figurehead Interperso nal Leader Liaison Monitor Disseminator Spokesperson Entrepreneur Disturbance Handler Resource Allocator Negotiator

Provide Information

Feedback

Informatio nal

Process Information

Decisional

Use Information

The three interpersonal roles are primarily concerned with interpersonal relationships. In the figurehead role, the manager represents the organization in all matters of formality. The top level manager represents the company legally and socially to those outside of the organization. The supervisor represents the work group to higher management and higher management to the work group. In the liaison role, the manger interacts with peers and people outside the organization. The top level manager uses the liaison role to gain favors and information, while the supervisor

uses it to maintain the routine flow of work. The leader role defines the relationships between the manger and employees. The direct relationships with people in the interpersonal roles place the manager in a unique position to get information. Thus, the three informational roles are primarily concerned with the information aspects of managerial work. In the monitor role, the manager receives and collects information. In the role of disseminator, the manager transmits special information into the organization. The top level manager receives and transmits more information from people outside the organization than the supervisor. In the role of spokesperson, the manager disseminates the organization's information into its environment. Thus, the top level manager is seen as an industry expert, while the supervisor is seen as a unit or departmental expert. The unique access to information places the manager at the center of organizational decision making. There are four decisional roles. In the entrepreneur role, the manager initiates change. In the disturbance handler role, the manger deals with threats to the organization. In the resource allocator role, the manager chooses where the organization will expend its efforts. In the negotiator role, the manager negotiates on behalf of the organization. The top level manager makes the decisions about the organization as a whole, while the supervisor makes decisions about his or her particular work unit. The supervisor performs these managerial roles but with different emphasis than higher managers. Supervisory management is more focused and short-term in outlook. Thus, the figurehead role becomes less significant and the disturbance handler and negotiator roles increase in importance for the supervisor. Since leadership permeates all activities, the leader role is among the most important of all roles at all levels of management. Managers create and maintain an internal environment, commonly called the organization, so that others can work efficiently in it. A manager's job consists of planning, organizing, directing, and controlling the resources of the organization. These resources include people, jobs or positions, technology, facilities and equipment, materials and supplies, information, and money. Managers work in a dynamic environment and must anticipate and adapt to challenges. The job of every manager involves what is known as the functions of management: planning, organizing, directing, and controlling. These functions are goal-directed, interrelated and interdependent. Planning involves devising a systematic process for attaining the goals of the organization. It prepares the organization for the future. Organizing involves arranging the necessary resources to carry out the plan. It is the

process of creating structure, establishing relationships, and allocating resources to accomplish the goals of the organization. Directing involves the guiding, leading, and overseeing of employees to achieve organizational goals. Controlling involves verifying that actual performance matches the plan. If performance results do not match the plan, corrective action is taken.

Psychological Factors in Managerial Effectiveness

Managerial effectiveness is difficult to measure in purely objective and observable terms. Profits of a unit, department or company need not be indicators of the effectiveness of a manager because these depend on a number of other factors like the overall capabilities of other managers, their co-operation, the nature of tasks undertaken by the organisation, favourable socio-economic environment of the country etc. No manager works in isolation. The interdependence of managers and other employees in an organisation makes the measurement of any given managers effectiveness difficult. There are certain criteria, however, that can be used to assess the extent to which managers are effective. If a manager is able to recognise his own strengths and weaknesses, understand the requirements of job well, use his strengths and overcome weaknesses through continuous learning on the job, he may be considered effective. He understands his job and job requirement well his role; the various functions he is expected to perform; and the capabilities (technical, managerial and behavioural) required to perform the various functions. Through his interactions with various tasks and being sensitive to the outcomes of different actions taken by him, he is constantly aware of his strengths and weaknesses. Using this self-awareness as well as his awareness of the capabilities of others, he so plans his activities that his own strengths and the strengths of his subordinates are well utilised in the tasks he and his subordinates perform. In the process of his performing various takes he is also continuously growing and acquiring newer capabilities.

Implied are the managers sensitiveness to the environment; his sensitiveness to the needs and capabilities of the subordinates and others who work with him; his ability to plan and organise; his ability to forecast future requirements; and above all, his ability to create a climate where his

subordinates are bale to give their best and feel happy about it. Certain qualities (behavioural dimensions) that contribute to managerial effectiveness are: 1. Personal Efficacy One of the important factors that contribute to managerial effectiveness is personal efficacy. This can be defined as the general sense of adequacy in a person. It influences the individuals general orientation and style of life, by virtue of which his effectiveness in working for a task-related goal is likely to increase. The roots of efficacy (potential effectiveness) of an individual are in his perceptions and beliefs about himself. These beliefs may be the result of an individuals self-concept and his perception of his own strengths. Efficacy can be quantified on two aspects: a) its strength the extent to which it is dominant, and b) its multi-facetness the number of dimensions on which the individual carries efficacious feelings. The different factors constituting personal efficacy of an individual, may vary in strength and direction of their contribution. The following dimensions have been found to characterise the thought processes and self-concept of people with a high sense of efficacy. Action Goal Orientation People with a high sense of personal efficacy have clear goals about their future and are directed by these goals. These goals may either be long term or short term. These goals are action goals rather than essence goals. Action goals depict the person as involved in doing something when he achieves his goal whereas essence goals depict the person as being something when he achieves the goal. For example person likes the state of being called Chief, GM, Minister, etc., rather than doing the activities associated with the role. Initiative versus Conformity A person with a high sense of efficacy sees himself as an initiative taker or as a proactive person. A proactive person does things on his own without having to be told by any one. Such initiative taking behaviour leads to a high level of activity and experimentation. Proactive behaviour is a reflection of a high level of self-confidence and drive. Internal Resources People with a high sense of efficacy are also aware of their internal strengths. They may also be aware of their weaknesses but such

awareness helps them to look for opportunities for self-improvement rather than getting too paralysed to act positively.

Problem Solving Capability People with a high sense of efficacy see themselves as problem solvers rather than problem avoiders. They have a positive orientation to problems and approach problem situations with optimism. They do not run away from problems. 2. Role Efficacy Role efficacy is the potential effectiveness of a person in his role. Managers with the following perceptions of their roles are likely to be more effective: The role is central in the organisation characterised by a feeling that the functions performed are important to the functioning of the organisation. The role offers an opportunity to be creative, characterised by a feeling that one has opportunity to innovate and try out many new ideas and do new things. The role offers enough scope to take initiative and to be proactive, characterised by a feeling that he has the freedom to do what he wants and can initiate action at his own level without being pressurised to conform. The role offers an opportunity to apply his capabilities with a feeling that he enjoys performing the role and there are inter-dependencies in which his role also is an important link point. The role gives opportunities to learn new things and increase meaningful experience. The role offers an opportunity to help others or contribute to the development of others, and get help when it is needed. The role offers opportunities to continuously learn new things, capabilities and grow. The role can be used to serve super-ordinate goals like working for the needs of the larger society, welfare of human beings, a good cause, etc. The role offers an opportunity to influence others. 3. Motive Combinations Motives are driving forces. They can be inferred from consistence in behaviour. Higher order motives are acquired in the process of socialisation. Six motives that have been found to play an important role in determining managerial effectiveness are: the motivation for achievement characterised by a concern for taking challenges and accomplish unique things; the motivation for influencing others; the motivation for helping

others (called extension motivation), the motivation to establish and maintain effective relationship with others (called affiliation motivation); the motivation to control others; and the motivation to be dependent on others (called as dependency motivation). Need for Achievement The need to excel known as n achievement is the single psychological factor that has been extensively researched. Achievement motive is a critical factor that leads a person towards entrepreneurship and other forms of accomplishments. Achievement-oriented people are, by and large, those with a high drive and activity level, constantly struggling to achieve something, which they could call their own accomplishment. They strive to accomplish apparently difficult things, wanting to take the challenge. They accept challenges, which they are confident of achieving with their own efforts. Need for Influencing Others Dealing with people effectively needs a drive on the part of the manager to influence them, to sell his ideas to them, and to lead them in the process of establishing, stabilising and expanding his organisation. The drive to influence people and lead them may be called the need for power. Successful managers have this need ranking very high and have become successful institution builders. They can predict the stumbling blocks (personal and environmental) in their efforts to influence others and make attempts to overcome these. They use their influencing abilities sparingly and discriminately. Need for Affiliation/ Extension Concern for the welfare of others and the benefit of the subordinates, or a concern for larger organisational goals and national interests characterise extension motivation. This motivation is very helpful to be an effective manager. On the other hand, the need to control others for the sake of feeling powerful or enjoying status has been found to be quite dysfunctional for managerial effectiveness. Similarly the need for dependency, which leads to the tendency not to do anything, without confirming with somebody else or consulting the rulebook, etc., is quite dysfunctional in managerial life. To, be effective as a manager some need for achievement, a high need for influence, high need for extension, and low need for dependency, control and affiliation are likely to be helpful. 4. Openness to Feedback and Learning from Experience Learning from experience and feedback is a great quality for anyone to have. These managers continuously modify their goal-setting behaviour on

the basis of the feedback they receive from their environment. There is an orientation and flexibility of mind to test out capabilities whenever an opportunity arises and is open to feedback. 5. A Belief that they can change the Environment Effective managers also tend to believe in their own capacity to influence the environment and change it rather than leaving everything to luck, God or forces beyond their control. They believe that they can shape their own destiny. Whenever they achieve something or get rewarded they tend to attribute it to their own efforts rather than to luck or someone elses grace. In psychological terms, such a characteristic is referred to as an internal locus of control. This helps them in making their efforts with vigor so that they can make things happen rather than leave them to happen on their own. This also helps them to accept their mistakes and improve upon them. When they fail, they are candid enough to own up their mistakes as they claim their successes.

6. Time Orientation A past-oriented person lives in his past. He is so taken up by his past achievements and failures that he is all the time overwhelmed by such thoughts about the past and cannot live in the present effectively nor can be he project himself into the future. A future-oriented person is one who is entirely living in daydreams of the future. An effective manager is a rational balance between the two extremes. He is neither completely future-oriented nor completely past-oriented. He is pragmatic and realistic. He projects himself into the future to the extent that he has clear goals and plans. But the present is important for him. 7. Expectations from Employees Effective managers tend to have high expectations from their employees. Managers set high goals for themselves and their workers and drive everyone hard to achieve the goals. They provide necessary support and guidance for their employees in their work. They are constantly giving them feedback and helping their subordinates also to advance. 8. Inner Directedness

Effective managers are more inner-directed. An inner-directed person lives by his own capacities, desires and action, rather than trying to survive or thrive on those of others. He is, thus, continuously trying to experiment, exploring his capabilities, and using them in the best interest. 9. Tolerance for Ambiguity Managers as decision-makers have to continuously work with uncertainties. People who have high intolerance for ambiguity are those who feel very uncomfortable when they face uncertainties and act fast in order to reduce their own anxiety or tension. Such mangers are impatient and fast decision-makers. They give themselves little time to collect relevant data, generate new alternatives or to evaluate the available alternatives. Such decisions may turn out to be more emotional than rational. On the other extreme are managers who can be too tolerant of ambiguity and may delay decisions for unusually long periods. Obviously, this is also not desirable either. Just the correct amount of tolerance therefore, is very essential for a manager to be effective. Extremes are dysfunctional. 10. Interpersonal Trust Those who have high interpersonal trust accept what others say at face value. They have a positive attitude to other human beings, whereas those who have very low interpersonal trust do not seem to believe what others say, always look at them with suspicion and continuously seek evidence. Managers need to have a certain amount of trust in their subordinates. If a manager has low interpersonal trust he may create a climate of suspicion and a very low morale in his own department. Effective managers have a positive view of human nature, and try to build a climate of trust in their departments. Organisations that have trusting culture are likely to utilise human energy better and are likely to have fewer interpersonal conflicts and tensions.

Managerial Problem Analysis and Decision Making

Managerial problem analysis and decision making can be divided into four steps; problem analysis, developing alternatives, analyzing alternatives, and decision implementation. A systematic approach to the problem analysis phase has four distinct components. The first involves the initial statement of what is wrong, the situation that needs improvement, or the area where results might be better. Once this initial statement has been presented, the decision maker must gather the facts, investigate possible causes and identify the real problem. Next the requirements of a satisfactory solution, as objectives, are established; and finally any restrictions or limits on a solution are specified.

In the second step of decision making (developing alternatives) the manager has two directions in which he can turn. He can rely on his own experience is valuable and also the most logical direction in which to turn in developing alternative solutions to problems, it should be noted that in todays changing world, it usually is not adequate by itself. Ideally, the decision maker will also draw on the experience of others to develop alternatives. 1. Steps in Decision Making a. Analysis of the Problem i. Statement of what is wrong ii. Getting the Facts iii. Requirements of satisfactory solution as objectives. iv. Restrictions on solutions. Developing Alternative Solutions. Analyzing Alternative Solutions Implementing the Decision i. Developing a plan of action. ii. Communication. iii. Participation. 2. Consensus Decision Making Group think 3. Group Decision Making i. Developing a plan of action. ii. Communication. iii. Participation. Analyzing alternative involves considering both the advantages and disadvantages of each alternative, as they relate to accomplishing the objective of the decision, which were outlined, in step one. Examining the potential disadvantages is particularly important since they may reveal problems that could occur in the implementation step. In that way provision can be made before hand for overcoming those problems if an when they do appear.

b. c. d.

The final step of decision making, implementation, involves developing a plan of action, communicating the decision, and participation. In developing a plan of action, the questions of what must be done, in what sequence must it be done, who should do them, and how can they be most effectively accomplished must be answered. The decision must also be communicated to those effected, and people should be given the

opportunity to participate in various phases or steps in the total decision making process. The two latter procedures determine the degree to which the people who must implement the decision will be committed to having it carried out successfully. Participation in decision-making is useful because it utilizes the potential of subordinates. It is a vehicle for improving the quality of decisions as well as increasing the acceptance level on the part of those who must carry them out. These two factors (quality and acceptance) along with certain moderating variables will determine which of several possible degrees of participation is appropriate. Before utilizing participation it will benefit the manager to become familiar with its advantages, potential disadvantages and here groups are involved some of the characteristics of group think which can inhibit effective group actions. Various group decision making techniques have been devise for all owing more than one person to have inputs in the decision process. Brainstorming is useful in generating creative ideas. The Nominal Group Technique is the device for arriving at consensus when allowing large numbers of people to participate in decision making. The Delphi Technique is a means of aggregating the judgments of knowledgeable individuals in order to improve the quality of decision-making. Types of Managerial Decisions Managerial decisions may be classified on the following bases : Organisational and Personal Decisions Barnard has divided decisions into organisational decisions and personal decisions. Decisions taken by an individual executive himself are known as individual decisions or personal decisions. When an executive takes a decision in his official capacity, i.e. on behalf of the organisation, it is known as organisational decision. Organisational decisions can be delegated but authority for personal decisions is never delegated to any one else.

Routine and Strategic Decisions Routine or tactical decisions are taken in the context of day-to-day operations of the organisation. They are of a repetitive nature and do not require much thought and deliberation. They concern standard procedures to that individual cases can be handled by subordinates on a uniform basis. The general pattern is set by management but the particular circumstances are interpreted by the person involved and action is taken accordingly.

Such decisions are normally taken at lower levels of management within the policy framework laid down by top management.

On the other hand, strategic or basic decisions are generally taken by the top management. They concern policy matters and have fundamental effects on the organisation. They involve long-term commitment and heavy investment or expenditure of funds. Therefore, strategic decisions are taken after careful analysis and evaluation of various alternatives. Examples of strategic decision are plant location, product diversification, choice of channels of distribution, etc. Policy and Operating Decisions Policy decisions are those which are taken by top management and which are of a fundamental character affecting the entire organisation. Operating decisions or administrative decisions are concerned with day-today operations of the enterprise. These are taken by lower management for the purpose of executing policy decisions. They translate policies into actions by determining how policy will be carried out. Programmed and Non-Programmed Decisions Programmed decisions are of a routine and repetitive nature for which systematic procedures have been devised so that the problem need not be treated as a unique case each time it arises. The non-programmed decisions are unstructured and have to be taken by higher management. There is no standard procedure for handling them and each decision has to be treated as a unique case. Individual and Group Decisions A decision taken by an individual is known as individual decision. Individual decisions are taken in small organisation and for matters of a routine nature. In large organisations, specialised knowledge and experience is needed for decision-making. Therefore, a number of people participate in decision-making. Group decisions refer to decisions taken by a group of persons, e.g., Board of Directors, executive committee, etc. Participation in decision-making improves decisions by combining different viewpoints, complementing skills, avoiding motivational deadlocks, and facilitating coordination. Group decision-making, however, tends to be more expensive and time consuming.

Decision Analysis Decision making is undoubtedly the most difficult and most essential task a manager performs. One kind of decision he makes is not connected with problems; he may decide to take an action that will set entirely new standards of performance, or will attain some new goal or establish a new direction for his companys operations. Decisions of this kind are extremely important but relatively rare. Usually, the manager is making decisions connected with problems, present or future, and many of the difficulties are eliminated. When he has mastered problem analysis and can recognize and specify problems and determine their causes accurately.

A decision is always a choice between various ways of getting a particular thing done or an end accomplished. Making such a choice is often difficult, because a decision can be made only when a great many separate judgements have been made, derived from the examination of many facts. Most likely, a decision will be a compromise between what the manager wants, in an ideal sense, and what can actually be done. How does a manager do this? Many of the decisions that he faces in everyday operations involve very simple choices and relatively small amounts of information. But when major decisions arise, and he is faced with a large amount of complicated information, he often does not bother to put down and assess all the factors involved. The process of decision making is difficult because it involves not only experience, knowledge, common sense, and judgment, but also a great many future uncertainties that may threaten the action decided upon. Problem Solving v/s Decision Making Problem solving Identify and try to understand the problem Collect relevant information and reflect on it Generate some ides Develop solutions Select the best solution Implement it Decision making Identify the objectives (goals) of the decision Find alternative ways of meeting these objectives Determine evaluation criteria / techniques Select best course of action Implement it

The Ideal Problem Solving System? The features of an ideal problem solving system are listed below. Musts Search out and assimilate both hard and soft data (especially, political and cultural aspects of problem situation). Provide the means for looking at the problem situation from many viewpoints. Provide ways of generating ideas, by getting away from the problem situation. Actively involve the problem-owners, and accept input from them at various stages during the problem solving process. Provide the means of nurturing and developing ideas/possible solutions. Provide the problem-owners with a way of learning about the problem situation. Provide a conflict-resolving process. Provide the problem-owners with the means for evaluating possible solutions. Monitor its own performance and provide corrective feedback when appropriate.

Wants Take a holistic view of the problem situation. Incorporate the perceptions of everyone with a stake in the problem situation. Be flexible in its application. Encourage the participation/involvement of problem-owners in the problem solving/decision-making process, preferably in groups. Facilitate subsequent cultural changes. Possess the means to allow problem-owners to incubate/reflect upon ideas. Check out the motivation of the problem-owners. Many of these wants are essential, but keep in mind that musts have to be something that we can definitely say an option does or does not satisfy. Although highly desirable, it seems unreasonable to insist that certain problem solving system takes into account the perceptions of all those that have a stake, takes in the whole problem situation, etc. It is more realistic

to compare problem solving systems on the extent to which they achieve these wants.