ACADEMY OF COMMERCE ANOOP SINGH SACHDEVA (9971504050) BUSINESS STUDIES : NATURE & SIGNIFICANCE OF MGT. Meaning of Mgt. Mgt.

is the art of getting work done through others . It is the process of planning , organizing , staffing directing & controlling the enterprise resources efficiently & effectively for achieving the goals of the organization . In the words of Krietener , Mgt. is the process of working with & through others to effectively achieve organizational objectives by efficiently using limited resources in the changing environment . In the words of Koontz and O Donnel , Mgt. is establishing an effective environment for people operating in formal organizational groups. Concept of effectiveness & efficiency : The term effectiveness implies doing work effectively which basically means finishing the given task . Effectiveness in Mgt. is concerned with doing the right task , completing activities & achieving goals . In other words it is concerned with the end results . The term efficiency implies being efficient or doing work efficiently . Efficiency means means doing the work correctly & with minimum cost . Thus if by using less resources more resources are derived efficiency is said to exist . Effectiveness & Efficiency are two sides of the same coin . But these two aspects need to be balanced which is a challenging task for e.g it is easier to be effective & ignore efficiency i.e complete the given task but at a high cost for e.g suppose a co.s target production is 5000 units in a year . The manager is able to produce 5000 units but at a higher production cost . In this case the manager was effective but not so efficient since for the same output more than required cost is spent. Alternatively a business may concentrate more on producing goods at lesser cost but not able to achieve the target production . Consequently demand for them declines and competitors enter the market . This is a case of being efficient but not effective . Thus it is important for Mgt. to achieve goals (effectiveness) with minimum resources (efficiently)i.e maintain the balance between the two . Characteristics of Mgt. 1) Mgt. is goal oriented process :

An organization has a set of basic goals which are the basic reasons for its existence . These should be simple & clearly stated . Different organizations have different goals for e.g the goal of the retail store may be to increase sales but the goal of spastics society of India is to impart education to children with specific needs . Mgt. unites the efforts of different individuals in the organization towards achieving these goals 2) Mgt. is all pervasive : The activities involved in managing an enterprise are common to all organizations whether economic , social or political .A petrol pump needs to be managed as much as hospital or school. What managers do in INDIA, USA , GERAMNY or JAPAN are the same . How they do it may be quiet different This difference is due to difference in culture , tradition & history. 3) Mgt. is multidimensional : Mgt. is a complex activity that has three main dimensions . These are : ANOOP SINGH SACHDEVA(9971504050)

a)

Mgt. of work All organisations exist for performance of some work . In a factory a product is manufactured , in a hospital a patient is treated . Mgt. translates this work in terms of goals to be achieved and assigns the means to achieve it b) Mgt. of people People implies Human resource . Managing people has two dimensions : (i) (ii) It implies dealing with employees as individuals with diverse needs and behaviour It also means dealing with individuals as a group of people .

The task of Mgt. is to make people work towards achieving the organizational goals , by making their strengths effective & weaknesses irrelevant . c) Mgt. of operations Every organization provides some basic product or service in order to survive . This requires a production process / operational activity of transforming input material and the technology in to desired output for consumption. 4) Mgt. is a continuous process : Mgt. process is a series of continuous, composite but separate functions like planning, organising, staffing , directing & controlling . These functions are interlinked & interdependent . They are simultaneously performed by all the managers all the time . These are ongoing functions & Mgt. is continuously involved in the performance of these functions . 5) Mgt. is a group activity : An organization is a collection of diverse individuals with different needs. Every member of a group has a different purpose for joining the organization but as members of the organization they work as groups towards fulfilling the common organizational goal . Thus Mgt. is not a single individual.It is the group & requires teamwork & coordination of individual effort in a common direction to achieve goals .Mgt. as a team contributes more effectively & efficiently rather than individuals. 6) Mgt. is a dynamic function An organization interacts with external environment .In order to be successful , an organization must change itself and its goals according to the needs of the environment which consist of various social, economic& political factors Mgt. is a dynamic function & has to adapt itself to the changing environment for e.g Mc donalds , the fast food giant made major changes in its menu to be able to survive in the Indian market 7) Mgt. is an intangible force Mgt. is an intangible force that cannot be seen but its presence can be felt in the way the organization functions. The effect of Mgt. is noticeable in the organization where targets are met according to the plans, employees are happy & satisfied and there is orderliness instead of chaos. OBJECTIVES OF MGT. 1) ORGANISATIONAL OBJECTIVES : Mgt. is responsible for setting and achieving the objectives for the organization . Organisational objectives include those of survival, profit & growth ANOOP SINGH SACHDEVA(9971504050) Survival : Mgt. must strive to ensure the survival of the organization . In order to survive an organization must earn enough revenues to cover costs. Profit : Profit provides a vital incentive for the continued succesfull operation of the enterprise. Profit is essential for covering costs & risks of the business.

Growth : To remain in the industry Mgt. must exploit fully the growth potential of the organization .Growth can be measured in terms of increased sales volume, increased capital investment etc.

2)

SOCIAL OBJECTIVES :

It involves the creation of benefit for the society . Social objectives include : a) b) c) 3) Using environment friendly techniques of production . Giving employment opportunities to the disadvantageous section of the society . Providing the basic amenities like schools & hospitals to employees. PERSONAL OBJECTIVES

Organisation are made up of people who have diverse needs & objectives . They have some personal goals apart from the organizational goals. Mgt. has to reconcile personal goals with organistional goals for harmony in the organization.Mgt. must satisfy diverse needs such as a) Financial needs ( competitive salary & perks ) b) Social needs ( peer recognition ) c) Higher level needs ( personal growth & development ) IMPORTANCE OF MGT.

1)

Mgt. helps in achieving group goals :

Mgt. is required not for itself but for achieving the goals of the organization . The task of manager is tomgive a common directions to the individual effort in achieving the overall goals of the organization.

2)

Mgt. increases efficiency :

The aim of the manager is to reduce costs and increase productivity through better planning , organizing , directing , staffing and controlling the activities of the organization .

3)

Mgt. creates a dynamic organization :

All organizations have to function in an environment which is constantly changing . It is generally seen that individuals in an organizations resist change as it often means moving from a familiar secure environment in to a newer & more challenging one . Mgt. help people adapt to these changes so that the organization is able to maintain its competitive edge.

4) Mgt. helps in achieving personal objectives : A manager motivates & leads his team in such a manner that an individual members are able to achieve personal goals while contributing to the overall organizational objectives . Through motivation & leadership Mgt. helps individuals to develop team spirit , cooperation & commitment to achieve success .
ANOOP SINGH SACHDEVA(9971504050) 5) Mgt. helps in the development of society An organization has multiple objectives to serve the purpose of the different groups that constitute it . In the process of fulfilling all these , Mgt. helps in the development of the organization and through that it helps in the development of the society . It helps to provide good quality products & services , creates employment opportunities , adopts new technology for the greater good of the people & leads the path towards growth & development . NATURE OF MGT MGT. AS AN ART

Art is the skilfull & personal application of existing knowledge to achieve desired results . It can be acquired through study, observation & experience Basic features of an Art : Existence of theoretical knowledge : Experts in their respective areas have developed certain basic principles which forms the theoretical knowledge of the art. Personalised application : The use of theoretical knowledge differ from person to person which make the art personalized e.g two dancers , two actors will always differ in demonstrating their art. Based on Practice & Creativity : Art involves thecreative practice of existing theoretical knowledge . Repeated practice makes the art more published.. Mgt. can be said to be an art because ; a) A successful manager practices the art of Mgt. in the day to day job of managing an enterprise based on study observation & experience. b) There are various theories of mgt. which prescribe certain universal principles . A manager applies these scientific methods & body of knowledge to the given situation , an issue or a problem in his own unique manner. A good manager works through a combination of practice , creativity , imagination, initiative & innovation. c) A manager applies his acquired knowledge in a personal & skillfull manner in the light of the realities of the given situation. He is involved in the activities of the organization , studies critical situation, and formulates his own theories for the use in a given situation. MGT. AS A SCIENCE Science is a systematized body of knowledge that explains certain general truths or the operations of general laws. The basic features of Science are as follows ; Systematised body of knowledge : Scientific principles are based on cause & effect relationship Principles based on experimentation ; Scientific principles are first developed through observation & tested through repeated experimentation Scientific principles have universal validity & application Based on the above features we can say that mgt. has some characteristics of science . 1) Mgt. has a systematized body of knowledge .It has its own theory & principles that have dev-eloped over a period of time but it also draws on other disciplines such as economics , sociology , psychology & mathematics . 2) Principles of Mgt. have evolved over a period of time based on repeated experimentation & observations in different types of organizations. However since Mgt. deals with human beings & human behaviour , outcomes of these experiments are not capable of being accurately predicted or replicated . Terefore Mgt. is called as inexact science 3) Since the principles of Mgt. are not exact as the principles of science , their application & use is not universal . They have to be modified according to the given situation. However they provide managers with certain standardized techniques that can be used in different situations . These principles are also used for training & development of managers . MGT. AS A PROFESSION A profession is an occupation backed by specialized knowledge & training.A profession has the following characteristics:

1 ) Well defined body of knowledge All profession are based on well defined body of knowledge that can be acquired through instruction , formal teaching & learning. 2) Restricted Entry - The entry to a profession is restricted through an examination or through acquiring an educational degree. 3) Professional Association All professions are affiliated to a professional association which regulates entry & grants certificate of practice. 4) Ethical Code of Conduct All professions are bounded by a code of conduct which guides the behavior of its members. 5) Service Motive The basic motive of the profession is to serve their clients interests by rendering dedicated & committed services. Mgt. does not meet the exact criteria of a profession. However it does have some of the features of profession : 1) All over the world there is a marked growth in Mgt. as a discipline . It is based on a systematic body of knowledge comprising well defined principles. This knowledge can be acquired at different colleges & professional institutes & through a no.of books & Journals. 2) There is no restriction on anyone being designated or appointed as a manager in any business enterprise. Unlike Professions such as medicine or Law which require a practicing Lawyer or a Doctor to possess valid degrees nowhere in the world is it mandatory for a manager to possess any such specific degree but Professional knowledge & Training is considered to be a desirable qualification . 3) There are several associations of Practising managers in India Like the AIMA (All India Mgt. Association) that has laid down the code of conduct to regulate the activities of its members . There is however no compulsion for managers to be the members of such associations . 4) The basic purpose of the Mgt. is to help the organization achieve its stated goal . This may be profit maximization . But Profit maximization as the objective of the objective mgt. does not hold true & is fast changing. Conclusion : Mgt. is not a full fledged profession. LEVELS OF MGT. In a company , the whole relationship between managers & subordinates is arranged in a series of levels. There is a chain of authority - responsibility relationship. This chain is called Levels of mgt. There are three levels in the hierarchy of the Mgt. 1) TOP LEVEL MGT They consist of the Chairman , Board of Directors , the chief operating officer , President , the Chief executive officer, Vice president etc. Their functions are :, a) Integerating diverse elements & coordinating the activities of different departments . b) Formulating overall organizational goals and strategies for their achievement . c) Analysing the business environment and its implications for the survival of the firm . d) Framing the plans & Policies to achieve the determined objective. e) Ensuring that the work is being carried out according to schedule & plans laid down. 2) MIDDLE LEVEL MGT They consist of the Divisional / Departmental heads like Production manager , Sales Manager , Operations manager, Plant Superintendent etc. They are subordinate to Top managers & Superior to first line managers .Their functions are : a) Interpretation of Plans & Policies framed by the Top Mgt. to lower Level mgt. b) Organising resources & activities of their concerned departments for executing plans & policies c) Implementing the Plans & Policies developed by the Top level Mgt.

d) Cooperating with other departments for smooth functioning of the organization e) Motivating the Personnel for higher productivity to achieve desired objectives. 3) LOWER LEVEL MGT. It is also called Supervisory or Operational Level Mgt. They consist of Foremen & Supervisor , Inspector etc. who directly control the actual workers performing the task of production. Their functions include : a) Representing the workers grievancies before the Mgt. b) They interact with actual work force & pass on instructions of the middle Mgt.to the workers . c) Through their efforts quality of output is maintained , wastage of material is minimized and safety standards are maintained . d) They ensure adequate lightning , ventilation , orderliness in the working area & providing other amenities to the workers. e) The quality of workmanship, and the quantity of output depends on the hardwork , discipline & loyalty of workers . FUNCTIONS OF MGT. 1) PLANNING Planning is deciding in advance what to do and how to do . It is one of the basic managerial functions . It involves setting objectives and developing an appropriate course of action to achieve these objectives . 2) ORGANISING It is the process of defining and grouping activities and establishing authority relationships among them. It consist of identification & division of work & Departmentalisation . 3) STAFFING It is described as the managerial function of filling and keeping filled the positions in an organization structure . This is done through Recruitment , Selection, Placement , Promotion , Appraisal , Development of Personnel. 4) DIRECTING It is the complex managerial function consisting of all the activities that are designed to encourage subordinate to work efficiently . It includes Supervision , Motivation , Communication & Leadership 4) CONTROLLING Controlling is the process of ensuring that actual activities conformed to the palnned activities . In case of any deviations corrective measures are taken. Controlling makes the plans effective. COORDINATION The process by which Manager synchronises the activities of different departments is known as Coordination. Coordination is the process of achieving unity of action among interdependent activities and harmonious implementation of plans for the achievement of desired goals . In the words of E.F.L. Brech Coordination is balancing & keeping together the team by ensuring suitable allocation of tasks to the various members & seeing that the tasks are performed with harmony among the members themselves . COORDINATION IS THE ESSENCE OF MGT. Coordination is the force that binds all the other functions of Mgt.It is the common thread that runs through all activities such as purchase, production, sales & finance to ensure continuity in the working of the organization. Coordination is the essence of Mgt. . It is required for achieving harmony among individual efforts towards the accomplishment of group goals . 1) The process of coordinating the activities of the organization begins at the planning stage itself . Top Mgt. plans for the entire organization . Coordination is required between the master plan & the supportive plans of the different departments. 2) According to the plans the organization structure is developed . Coordination is required between different resources of an organization and also between authority , responsibility & accountability.

3) In staffing the coordination is required between skills of a person and the job assigned to him, between efficiency & compensation etc. 4) In order to ensure that the plans are executed according to plans , directing is required . Coordination is required between superior and subordinates , between orders , instructions , guidelines , suggestions etc. 5) Any discrepancies between actual & standard performance are than taken care of at the stage of controlling . In controlling function of Mgt. , coordination is required between standards & actual performance . CONCLUSION : Coordination is not a separate function of mgt. but its very essence. For an organization to effectively & efficiently achieve its objectives , coordination is required. Like a thread in the garland , coordination is the part of all Mgt. functions . COORDINATION IS REQUIRED AT ALL THE LEVELS OF MGT. 1) Top level managers need to coordinate with their subordinates to ensure that the overall policies for the organization are duly carried out . 2) Middle level Mgt. coordinates with both the top level & First line managers. 3) Operational level Mgt. coordinates the activities of its workers to ensure that work proceeds according to plans . DIFFERENCE BETWEEN COORDINATION & COOPERATION BASIS COORDINATION COOPERATION Cooperation refers to the voluntary efforts of Individuals

MEANING n Coordination is the process of achieving unity ) Coordinati of action among interdependent activities and harmonious implementation of plans for the achievement of desired goals.

NATURE

Coordination does not arise automatically from the voluntary efforts of people. It is a conscious & deliberate action of manager

Cooperation is voluntary in nature

SCOPE

It includes cooperation & hence it is wider in Scope

It has a narrow scope as it is towards establishing coordination

NATURE OF COORDINATION 1) Coordination integrates group efforts : Coordination unifies diverse activities in to purposeful work activity. It gives a common focus to group efforts to ensure that actual performance is as per the planned performance. 2) Coordination ensures unity of action : The purpose of coordination is to secure unity of action in the realization of a common purpose .

3) Coordination is a continuous process : Coordination is not a on e time function but a continuous process . It begins at the planning stage but continuous till controlling. 4) Coordination is all pervasive function : Coordination is required at all levels of Mgt. & in all departments of the organization. 5) Coordination is a deliberate function : A manager has to coordinate the efforts of the people in a conscious & deliberate manner. IMPORTANCE OF COORDINATION 1) Growth in size As an organisation grows in size , the no. of employees also increases. They differ in their habits of work , background, approaches to situations & relationships with others . So it becomes quite essential to integrate their efforts & activities so that the organizational goals are achieved effectively & efficiently. 2) Functional differentiation In an organisation there may be separate departments of production , finance , marketing & human resource .. All departments have their own objectives , policies, strategies etc. , so thrte may arise conflicts between them. Therefore coordination is essential to link the activities of various departments. 3) Specialisation In modern organisation there is high degree of specialisation arising out of the complexities of modern technology & diversification . So organisation need to employ specialists who think that they only are qualified to evaluate judge & decide .They do not take adviceor suggestions from the departmental heads .this often leads to conflicts among soecialities and the managers .Therefore coordination is needed to reconcile the differences in their approaches.