1. Corporate Governance in management

a) Meaning of corporate governance

Corporate governance is a set of rules that define the relationship between stakeholders,

management and the board of directors of an organization.

b) Importance of corporate governance in management.

It increases the accountability of a company.

It enhances the company’s image in the public eye as a self- policing company that is

responsible and worthy of shareholders and debtholder capital.

It keeps a company honest.

It dictates the shared philosophy, practices and culture of an organization and its

employees.

It translates to better performance of an organization thus aids growth.

c) Application of corporate governance in management.

A company or an organization must have a framework of rules and practices that guides the

day to day running of an organization. These may be in form of a board charter that guides

the board, Human resource policy that guides the employees of the organization, and

procurement policy that guide the relationship between the organization and its suppliers.

Every organization must have all the relevant policies and should implement them.

2 Governance Boards in management.

a) Meaning of Governance boards in management

A Governance board is a group of people that oversee or manage the running of an

organization.

The Governance board should be composed of competent, diverse and qualified members

capable of exercising objective and independent judgement.

The board membership should of an organization should not be less than five and should be

composed of both executive and non-executive members

b) Importance of Governance boards in management

It approves and authorizes the annual operating plan and the supporting operating and

capital budgets

It approve board committee appointments, board work plan and annual board budget

Approve all policies formulated by management that involve legal, regulatory and other

external issues.

Select the CEO and determine his or her compensation and annual increases

c) Application of Governance boards in management

The governance board provides the overall leadership and is responsible for the strategic

direction of an organization.

Every organization should have a Governance board to ensure that all the operations of the

organization run smoothly.

The Governance board approve policies which are then implemented by the management of

an organization.

3 Management by objective.

a) Meaning of management by objectives.

Management by objective is a technique and philosophy of management based on

converting an organizational objective into a personal objective on the presumption that

establishing personal objectives makes an employee committed, leading to better

performance.

Management by objective was introduced by Peter Drucker in 1954 and later was developed

by various writers like Douglar McGregor, John Humble and George Ordiorne.

b) Importance of management by objectives.

An effective system of Management by objective helps:-

To make a more systematic evaluation of performance in an organization.

To locate weak and areas with problems because of improved communication and

organization structure,

To stimulate the surbordinates’ motivation.

Serve as a device for organizational control integration.

In improving productivity as the management team concentrates on the important task

of reducing costs.

Provide managers with the opportunity for personal satisfaction because they participate

in the setting of objectives and rational performance appraisal.

c).Application of management by objectives

Management by objective is applied in the modern day management in a case where an

organization has a set of objectives for all employees starting from the top level to the

lowest level of management.

Resources are also allocated as per the set objectives in an economical manner to ensure

that the objectives are met.

4. Management by walking around.

a).Meaning of management by walking around

This means the unstructured approach to hands-on, direct participation by the managers in

the work-related affairs of their subordinates. In MBWA practice, managers spend a

significant amount of their time making informal visits to work area and listening to the

employees.

This method is common to individual who need very close supervisions to perform their

work and also if dealing with quality management system especially in production

functions. Otherwise, it may make some staff members feel untrusted hence not

performance well their tasks. The method should be strictly be applied in cases based on the

nature of work and need basis.

b).Importance of management by walking around.

It allows the management to collect qualitative information by listening to the

complaints and suggestions of the employees.

c).Application of management by walking around

Management by walking around can be applied by management in a flower farm.The

manager makes informal visit supervising the flower pickers and listening to their opinions

about their work.

5. Total Quality Management

a) Meaning of total quality management.

Total Quality Management according to pfau (1989) is an approach for continuously

improving the quality of goods and services delivered through the participation of all levels

and functions of the organization.

Kiritharan(2004) described Total quality management as a commitment to continuous

improvement of quality.

Total quality management suggest that for any organization to remain competitive the

customer requirements should be met at the lowest cost possible.

b) Importance of total quality management

Total quality management leads to:-

Establishment of effective goals and objectives.

Improved organizational performance capability.

Better performance in meeting the customers’ needs.

Increase in the profitability of an organization.

Greater knowledge and work satisfaction on the part of the members of an organization.

c) Application of total quality management

Every organization should work continuously to improve the service and products quality so

as to enhance the customers and employee satisfaction. Customer and employee satisfaction

is one of the managements’ objectives.

Total quality management allows an organization to remain competitive because the

customers’ needs are being met at the lowest cost possible

6. Balanced score card

7. Use of consultants

a) Meaning of use of consultants.

A consultant is a professional who provides professional or expert advice in a particular area

to others to help them understand what they need to do to make better profits.

The use of a consultant is the bringing in of an expert to an organization to help the

management understand what they need to do and how they should do it so as to remain or

become relevant in the market.

b) Importance of use of consultants.

Consultant help analyse the market and devise the kind of plans that will help with

growth of an organization especially with the fierce competition nowadays

They provide solutions to specific challenges and situations in an organization.

They help validate ideas that have already been created in the organization

Consultants bring in an experienced “outsiders” evaluation and point of view

Consultant facilitate the search for ideas and solutions with existing team members of an

organization

They facilitate creation and implementation of methodologies and systems that enhance

efficiency in an organization

Consultants help bring, teach or implement “new” business ideas and procedures.

d) Application of use of consultants.

A company manufacturing soft drinks can use consultants to find out what market they are

in and who their target market is. The consultants will help survey potential customers and

find out what they want and what they would buy, so that the company can find a way to

gain the most number of customers for their soft drinks.

8. The historical background of management.

a) Meaning of historical background of management

Management is the planning, organizing, leading and controlling of human and other

resources to achieve organizations’ goals effectively and efficiently.

The study of management as a separate discipline started in the last century.

Most writers agree that the origin of management can be traced to the work performed by

F.W. Taylour and his associates who generated the scientific management movement

around 1900.

b).Importance of historical background of management.

9. Theories of management.

Classical Management Theory

This theory is among the first schools of management thought, it developed during the

Industrial Revolution (1900-1930) when new problems related to the factory system began

to appear. Managers were unsure of how to train employees (many of them non‐English

speaking immigrants) or deal with increased labor dissatisfaction, so they began to test

solutions. As a result, the classical management theory developed from efforts to find the

“one best way” to perform and manage tasks. This school of thought is made up of two

branches: classical scientific and classical administrative, described in the following sections.

1. The classical scientific branch arose because of the need to increase productivity

and efficiency. The emphasis was on trying to find the best way to get the most work

done by examining how the work process was actually accomplished and by

scrutinizing the skills of the workforce.

The classical scientific school owes its roots to several major contributors, including

Frederick Taylor, Henry Gantt, and Frank and Lillian Gilbreth.

Frederick Taylor is often called the “father of scientific management.” Taylor believed that

organizations should study tasks and develop precise procedures.

Henry Gantt, an associate of Taylor's, developed the Gantt chart, a bar graph that measures

planned and completed work along each stage of production. Based on time instead of

quantity, volume, or weight, this visual display chart has been a widely used planning and

control tool since its development in 1910.

Frank and Lillian Gilbreth, a husband‐and‐wife team, studied job motions. In Frank's early

career as an apprentice bricklayer, he was interested in standardization and method study.

He watched bricklayers and saw that some workers were slow and inefficient, while others

were very productive. He discovered that each bricklayer used a different set of motions to

lay bricks. From his observations, Frank isolated the basic movements necessary to do the

job and eliminated unnecessary motions. Workers using these movements raised their

output from 1,000 to 2,700 bricks per day.

Based on the studies by the above pioneers, basic ideas regarding scientific management

developed. They include the following:

Developing new standard methods for doing a job

Selecting, training, and developing workers instead of allowing them to choose their

own tasks and train themselves

Developing a spirit of cooperation between workers and management to ensure that

work is carried out in accordance with devised procedures

Dividing work between workers and management in almost equal shares, with each

group taking over the work for which it is best fitted

2. The classical administrative approach concentrates on the total organization. The

emphasis is on the development of managerial principles rather than work methods.

Contributors to this school of thought include Max Weber, Henri Fayol, Mary Parker Follett,

and Chester I. Barnard. These theorists studied the flow of information within an

organization and emphasized the importance of understanding how an organization

operated.

In the late 1800s, Max Weber disliked that many European organizations were managed on

a “personal” family‐like basis and that employees were loyal to individual supervisors rather

than to the organization. He believed that organizations should be managed impersonally

and that a formal organizational structure, where specific rules were followed, was

important. In other words, he didn't think that authority should be based on a person's

personality. He thought authority should be something that was part of a person's job and

passed from individual to individual as one person left and another took over. This non

personal, objective form of organization was called a bureaucracy.

Weber believed that all bureaucracies have the following characteristics: A well‐defined

hierarchy, Division of labor and specialization, Rules and regulations, Impersonal

relationships between managers and employees and Competence.

Henri Fayol, a French mining engineer, developed 14 principles of management based on

his management experiences. These principles provide modern‐day managers with general

guidelines on how a supervisor should organize her department and manage her staff.

Mary Parker Follett stressed the importance of an organization establishing common goals

for its employees. She stressed the importance of people rather than techniques — a

concept very much before her time.

Chester Barnard, introduced the idea of the informal organization — cliques (exclusive

groups of people) that naturally form within a company. He felt that these informal

organizations provided necessary and vital communication functions for the overall

organization and that they could help the organization accomplish its goals.

Neo-classical Theory

Neoclassical approach of management (1930-1960): The Neoclassical approach began with

the Hawthorne studies in the 1920s (Wikipedia, 2013). It grew out of the limitations of the

classical theory. Under classical approach, attention was focused on jobs and machines.

After some time workers resisted this approach as it did not provide the social and

psychological satisfaction. Therefore, attention shifted towards the human side of

management. George Elton Mayo (1890- 1949) is considered to be the founder to the

neoclassical theory (Gupta C B, 1992). He was the leader of the team which conducted the

famous Hawthorne Experiments at the Western Electric Company (USA) during 1927-1932.

There are mainly three elements of neoclassical theory of management. They are

Hawthorne Experiment, Human Relation Movement, and Organizational Behavior.

Human Relations Movement

The human relations movement was a direct result of Elton Mayo and Fritz J.

Roethlisberger's Hawthorne studies, which were designed to find ways to

increase worker productivity at Western Electric's Hawthorne Works factory by

assessing working conditions related to things such as lighting levels, rest periods,

and the length of a work day. Those participating in the experiments were watched

closely by the researchers. During the experiment, productivity levels of those

participating in the experiment increased but not directly due to the conditions that

Mayo and Roethlisberger were imposing on them.

Because they could not correlate the increase in productivity to the working

conditions that they were controlling in the experiment, alternative causes were

explored. Eventually, the researchers attributed the increase in productivity to the

higher morale that was witnessed in the group during the experiment. This morale

and productivity boost was indirectly caused by the changes the researchers made

to working conditions, including:

Workers feeling special because they were selected to participate in the study

and were being paid so much attention by the researchers.

Workers developing strong interpersonal relationships with one another and

their supervisor as they determined how to manage their work together under

the new structure. They all valued the contributions of their coworkers.

The strong interpersonal relationships also created a pleasant and enjoyable

work environment.

Application/Appraisal of neoclassical approach

Neoclassical theory has made significant contribution to an understanding of human

behavior at work and in organization. It has generated awareness of the overwhelming role

of human factor in industry. Contributors to this approach recognize an organization as a

social system subject to the sentiments and cultural patterns of the member of the

organization, group dynamics, leadership, motivation, participation, job environmental, etc

constitute the core of the neoclassical theory. This approach changed the view that

employees are tools and furthered the belief that employees are valuable resources. It also

laid the foundation for later development in management theory. Neoclassical approach is

not free from limitations. First, it lacks the precision of classical theory because human

behavior is unpredictable. Secondly, its conclusions lack scientific validity and suffer from a

clinical bias, its findings are tentative. Lastly its application in practice is very difficult

because it requires fundamental changes in the thinking and attitude of both management

and workers.

Modern Management Theory (1960 to present)

The modern business ideologists have recognized the social responsibilities of business

activities and thinking on similar lines. During the period, the principles of management

reached a stage of refinement and perfection. The formation of big companies resulted in

the separation of ownership and management.

This change in ownership pattern inevitably brought in ‘salaried and professional managers’

in place of ‘owner managers’. The giving of control to the hired management resulted in the

wider use of scientific methods of management. But at the same time the professional

management has become socially responsible to various sections of society such as

customers, shareholders, suppliers, employees, trade unions and other Government

agencies.

Under modern management thought three streams of thinking have been noticed:

(i) Systems Approach.

(ii). Contingency Approach

(iii) Quantitative or Mathematical Approach.

(ii) Systems Approach:

In the 1960, an approach to management appeared which tried to unify the prior schools of

thought. This approach is commonly known as ‘Systems Approach’. Its early contributors

include Ludwing Von Bertalanffy, Lawrence J. Henderson, W.G. Scott, Deniel Katz, Robert L.

Kahn, W. Buckley and J.D. Thompson.

They viewed organization as an organic and open system, which is composed of interacting

and interdependent parts, called subsystems. The system approach is to look upon

management as a system or as “an organised whole” made up of subsystems integrated

into a unity or orderly totality.

System approach is based on the generalization that everything is inter-related and inter-

dependent. A system is composed of related and dependent element which, when in

interaction, forms a unitary whole. A system is simply an assemblage or combination of

things or parts forming a complex whole.

One of its most important characteristic is that it is composed of hierarchy of sub-systems.

That is the parts forming the major systems. For example, the world can be considered to be

a system in which various national economies are sub-systems.

In turn, each national economy is composed of its various industries, each industry is

composed of firms; and of course, a firm can be considered a system composed of sub-

systems such as production, marketing, finance, accounting and so on.

The basic features of systems approach are as under:

(i) A system consists of interacting elements. It is set of inter related and interdependent

parts arranged in a manner that produces a unified whole.

(ii) The various sub-systems should be studied in their inter- relationships rather, than in

isolation from each other.

(iii) An organisational system has a boundary that determines which parts are internal and

which are external.

(iv) A system does not exist in a vaccum. It receives information, material and energy from

other systems as inputs. These inputs undergo a transformation process within the system

and leave the system as output to other systems.

(v) An organisation is a dynamic system as it is responsive to its environment. It is vulnerable

to change in its environment.

The systems approach is considered both general and specialized systems. The general

systems approach to management is mainly concerned with formal organizations and the

concepts are relating to technique of sociology, psychology and philosophy. The specific

management system includes the analysis of organisational structure, information, planning

and control mechanism and job design, etc.

(iii) Contingency or Situational Approach:

The contingency approach is the latest approach to the existing management approaches.

During the 1970’s, contingency theory was developed by J.W. Lorsch and P.R. Lawrence,

who were critical of other approaches presupposing one best way to manage. Management

problems are different under different situations and require to be tackled as per the

demand of the situation.

One best way of doing may be useful for repetitive things but not for managerial problems.

The contingency theory aims at integrating theory with practice in systems framework. The

behaviour of an organisation is said to be contingent on forces of environment. “Hence, a

contingency approach is an approach, where behaviour of one sub-unit is dependent on its

environment and relationship to other units or sub-units that have some control over the

sequences desired by that sub- unit.”

Thus behaviour within an organisation is contingent on environment, and if a manager

wants to change the behaviour of any part of the organization, he must try to change the

situation influencing it. Tosi and Hammer tell that organization system is not a matter of

managerial choice, but contingent upon its external environment.

Contingency approach is an improvement over the systems approach. The interactions

between the sub-systems of an organisation have long been recognised by the systems

approach. Contingency approach also recognises that organisational system is the product

of the interaction of the sub systems and the environment. Besides, it seeks to identify exact

nature of inter-actions and inter-relationships.

Contingency views are ultimately directed towards suggesting organisational designs

situations. Therefore, this approach is also called situational approach. This approach helps

us to evolve practical answers to the problems remanding solutions.

Kast and Rosenzweig said, “The contingency view seeks to understand the inter-

relationships within and among sub-systems as well as between the organization and its

environment and to define patterns of relationships or configurations of variables

contingency views are ultimately directed toward suggesting organization designs and

managerial actions most appropriate for specific situations.

IMPORTANCE OF MANAGEMENT

1) Acquisition and utilization of resources Management performs efficient acquisition

effective development and utilization and proper coordination of resources.

2) Environmental adaptation. Management adopts organization to changing environmental

forces.

3) Goal achievement Management achieves goals by balancing the requirement of jobs and

people.

4) Problem solving. Management solves organizational problems. It identifies and evaluates

various alternatives and choose appropriate course of action.

5) Performance control. Management measures and evaluates the actual performance.

6) Social responsibility Management anticipates and acts beforehand to social expectations.

Ref;

Bertalanffy, Ludwig von. 1968. General System Theory: Foundations, Development,

Applications.

Robbins, S.P. and David A. Decenzo (2001) Fundamental of Management. Delhi: Pearson

10. Professionalism.

Professionalism is defined as the skill, good judgment, and polite behavior that is expected

from a person who is trained to do a job well.

The Merriam-Webster dictionary defines professionalism as "the conduct, aims, or qualities

that characterize or mark a profession or a professional person"; and it defines a profession

as "a calling requiring specialized knowledge and often long and intensive academic

preparation." The above definitions imply that professionalism encompasses a number of

different attributes, and, together, these attributes identify and define a professional.

The key attributes of professionalism include:

Specialized Knowledge: the deep personal commitment to develop and improve their skills,

and, where appropriate, they have the degrees and certifications that serve as the foundation

of this knowledge. These professionals have worked in a serious, thoughtful and sustained

way to master the specialized knowledge needed to succeed in their fields; and that they

keep this knowledge up-to-date, so that they can continue to deliver the best work possible.

Competency: Professionals get the job done as they are reliable, keep their promises, by

managing expectations up front.

Honesty and Integrity: Professionals exhibit qualities of honesty and integrity by keeping

their word and will do the right thing even when it means taking a harder road. This implies

that the professionals will immediately ask for help when they need it, and are willing to

learn from others.

Accountability: Professionals hold themselves accountable for their thoughts, words, and

actions, especially when they have made a mistake. This personal accountability is closely

tied to honesty and integrity, and it is a vital element in professionalism.

Self-Regulation: Genuine professionals show respect for the people around them, no matter

what their role or situation. They exhibit a high degree of emotional intelligence   (EI) by

considering the emotions and needs of others, and they don't let a bad day impact how they

interact with colleagues or clients.

Image: Professionals look polished, and they dress appropriately for the situation as this

exudes an air of confidence, and they gain respect for this.

11. Ethics in management.

11. Ethics in management

Dfn: Management ethics is a set of principles and rules dictated by upper

management that define what is right and wrong in an organization. It is the guideline

that helps direct a lower manager's decisions in the scope of his or her job when a

conflict of values is presented.

Ethical management refers to corporate management that not only fulfills economic

goals and legal responsibilities, but also meets the ethical expectations imposed by

social norms in conducting business.

Importance

i. A positive and healthy corporate culture improves the morale among

workers in the organization, which may increase productivity and

employee retention; this, in turn, has financial benefits for the organization.

Higher levels of productivity improve the efficiency in the company, while

increasing employee retention reduces the cost of replacing employees.

ii. make employees want to stay with the business, reduce labor turnover

and therefore increase productivity

iii. attract more employees wanting to work for the business, reduce

recruitment costs and enable the company to get the most talented

employees

Application of management ethics in the modern day

The point of a corporate ethics code is to promote ethical behavior – not to enhance

productivity, profits or public relations. Still, a sound, well-administered code can

benefit a company and its stakeholders in a variety of ways. It can:

i. Guide employees in situations where the ethical course of action is not

immediately obvious.

ii. Help the company reinforce – and acquaint new employees with – its

culture and values. A code can help create a climate of integrity and

excellence.

iii. Help the company communicate its expectations to the staff to suppliers,

vendors and customers. Also, by soliciting feedback and questions, a

company can use the code to encourage frequent, open and honest

communication among employees.

iv. Minimize subjective and inconsistent management standards. A code

explicitly outlines the rights and responsibilities of staff members and helps

guard against capricious and preferential treatment of employees.

v. Help a company remain in compliance with complex government

regulations. The landmark Sarbanes-Oxley Act of 2002 requires public

companies to have an ethics code for senior financial officers.

vi. Build public trust and enhance business reputations. Also, a code helps

demonstrate the company’s values to socially responsible investors.

vii. Offer protection in preempting or defending against lawsuits.

viii. Enhance morale, employee pride, loyalty and the recruiting of outstanding

employees.

ix. Help promote constructive social change by raising awareness of the

community’s needs and encouraging employees and other stakeholders to

help.

x. Promote market efficiency – especially in areas where laws are weak or

inefficient – by rewarding the best and most ethical producers of goods and

services.

Adapted from Josephson Institute’s Good Ideas for Creating a More Ethical and

Effective Workplace, by Steve Nish