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Management and adminstration

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Page 1: Management and adminstration



Principles and Practice of


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Administration is above management

Administration is a part of


Administration and management are

the same.

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Administration is above management

Administration :Determination of objectives and policy formulation for achieving the objective

Management :Executive function which is primarily concerned with carrying out broad policies laid down by the administration.

* Administration determines the basic framework of the organization within which managerial functions are taken.

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Administration is a part of management

* Management-Social process involving responsibility for the effective and economical planning and the regulation of the operation of an enterprise, in the fulfillment of a given purpose or task

* Administration is that part of management which is concerned with the installation and carrying out of the procedures by which it is laid down and communicating the process of activities ,regulated and checked against plans.

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Administration and management are same Higher policy formulation level – higher

levels ,Lower at lower levels

Board of Directors and Chief Executive- administration

Managers and supervisors – Execution

Everyone performs all managerial functions, only relative importance of these function varies

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CLASSICAL PERSPECTIVE SCIENTIFIC MANAGEMENT : Emphasized the scientific study of work methods to

improve the productivity of individual workers Features of scientific management Separation of planning and doing Functional Foremanship Job Analysis Standardization Scientific Selection and training of Workers Financial Incentives Economy Mental Revolution

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Bureaucratic Organizations

Bureaucratic Organizations Approach- Max Weber

Management on an impersonal, rational basis through elements such as clearly defined authority and responsibility, formal record-keeping, and separation of management and ownership

Focuses on the total organization rather than the individual worker and delineates the management functions of planning, organizing, commanding, coordinating, and controlling.

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Characteristics of Bureaucracy:• Division of Labor, with clear definitions of authority

and responsibility.

Positions organized in a hierarchy of authority.

Managers subject to rules and procedures that will ensure reliable, predictable behavior.

Management separate from the ownership of the organization.

Administrative acts and decisions recorded in writing

Personnel selected and promoted based on technical qualifications

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Henry Fayol is a French Industrialist known as the real father of modern management

Administration’ instead of ‘management’ Classified the activities of an industrial

organization into six groups:Technical (relating to production)Commercial (buying, selling and exchange)Financial (Search for capital and its optimum use)Security (protection of property and person)Accounting (including statistics); andManagerial (planning, organization, command,

coordination and control)

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FAYOL’S MANAGEMENT Fayol six types of qualities that a

manager requires physical, mental, moral, educational, technical experience

The most important ability for a worker is technical; the relative importance of managerial ability increases as one goes up the scalar chain, with insight becoming the most important ability for top level executives

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Fayol's principles of management:

DIVISION OF WORK Centralization

Authority Scalar chain

Discipline Order

Unity of command Equity

Unity of direction Stability of tenure of personnel

Subordination of individual interest to

general interest


Remuneration Esprit de corps

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FAYOL’S MANAGEMENT Elements of managementPlanningOrganizationCommandingCoordination Controlling

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HUMANISTIC PERSPECTIVE• Advocates of humanistic approach were Mary

Parker Follett and Chester Barnard

• The acceptance theory of authority, which states that people have free will and can choose whether to follow management orders.

The human relations movement

The human resource perspective

The behavioral sciences approach.

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The human relations movement

Effective control comes from within the individual worker rather than from strict, authoritarian control.

Elton Mayo, F.J. Roethlisberger-famous experiments at the Hawthorne plant of the Western Electric Company between 1927 and 1932.

Small group of workers were placed in a separate room and number of variables were altered : wages were increased ,rest periods were introduced of varying length ,work day and work week were shortened

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Contributions of human relations movement A business organization is not merely a techno-economic system

but is also a social system

No correlation between improved working conditions and productivity.

Production norms for workers are set by their group and not by the time, motion and fatigue studies

Workers who deviate from the production norms set by the group are isolated, harassed and penalized by their co-workers

Non-financial factors such as affection and respect of his co-workers play a significant role in influencing his behavior.

Employee centered, democratic and participative style of supervisory leadership is more effective than task-centered leadership.

As informal groups play an important role in influencing workers’ behavior, the informal group and not the individual is the dominant unit of analysis in the organization

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The human resource perspective

Two of the best-known contributors to the human resources perspective were Abraham Maslow and Douglas McGregor.

The human resources perspective combines prescriptions for design of job tasks with theories of motivation.

Jobs should be designed so that tasks are not perceived as dehumanizing or demeaning but instead allow workers to use their full potential.

Douglas McGregor (1906-1964) formulated Theory X and Theory Y

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The Human Relations Movement: Douglas McGregor & Theory X

versus Theory Y Theory X Theory Y

* Pessimistic negative view towards workers

• Optimistic positive view of workers: human relations proponents’ view

* Workers are irresponsible Workers are capable of accepting responsibility

* Workers are resistant to change

Workers are capable of self-direction

*Workers lack ambition, hate to work

Workers are capable of self-control

* Workers would rather be led than lead

• Workers are capable of being imaginative and creative

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Behavioral Sciences Approach

* Scientific methods and draw from sociology, psychology, anthropology, economics, and other disciplines to develop theories about human behavior and interaction in an organizational setting.

* 1970s- Organization development - behavioral sciences to improve the organization’s health and effectiveness through its ability to cope with change, improve internal relationships, and increase problem-solving capabilities

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QUANTITATIVE PERSPECTIVE Quantitative perspective involves mathematics ,statistical

techniques and computer technology

Helps in solving complex problems and facilitates

management decision making

* Operations research

* Operations management

* Information technology

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Operations research :Consists of mathematical model building and other applications of quantitative techniques to managerial problems

Operations management : Specializes in the physical production of goods Quantitative techniques to solve manufacturing

problems such as forecasting , inventory modeling ,linear and nonlinear programming ,queuing theory, scheduling ,simulation and break even analysis

Information Technology Management information systems have adopted

technology to provide relevant information to managers in timely and cost efficient manager

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Mc Kinsey’s 7-S approach Strategy: Systematic action and allocation of resources

to achieve company objectives. Structure: Organization structure and

authority/responsibility relationships. Systems: Procedures and processes such as information

systems, manufacturing processes, budgeting and control processes.

Style: The way management behaves and collectively spends its time to achieve organizational goals.

Staff: The people in the enterprise and their socialization into the organizational culture.

Shared values (super –ordinate goals): The values shared by the members of an organization that shape its destiny.

Skills: Distinctive capabilities of an enterprise.

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The hard S’sStrategy



The soft S’sStyle/Culture:

Organizational culture

Management Style



Mc Kinsey’s 7-S approach

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Contributions of Peter F. Drucker* Emphasized management with creative

and innovative characteristics.

* Managers should not only have skills and techniques but should have right perspective putting the things into practice

* Need to be good practitioners so that they can understand the social and cultural requirements of various organizations and countries.

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Contributions of Peter F. Drucker Manager has three basic functions which he

must perform to enable the institution to make its contributions for:

(I)The specific purpose and mission of the institution

(II)Making work productive and the worker achieving

(III)Managing social impacts and social responsibilities

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Contributions of Peter F. Drucker

Replacement of bureaucratic structure Three basic characteristics of an effective

organization structure.

(i)Enterprise should be organized for performance

(ii)It should contain the least possible number of managerial levels

(iii) It must make possible the training and testing of tomorrow’s top managers-giving responsibility to a manager while still he is young.

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Contributions of Peter F. Drucker

Three basic aspects in organizing:

Activity Analysis: Shows what work has to be performed, what kind of work should be put together, and what emphasis is to be given to each activity in the organization structure..

Decision analysis: Takes into account the four aspects of decision; the degree of futurity in the decision, the impact of a decision over other functions, number of qualitative factors that enter into it, and whether the decision is periodically recurrent or rare. Such an analysis will determine the levels at which the decision can be made

Relation Analysis: Analysis helps in defining the structure and also to give guidance in manning the structure

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Systems Thinking A system is a set of interrelated parts that function as

a whole to achieve a common purpose

Subsystems are parts of a system, such as an

organization, that depend on one another.

Systems thinking is the ability to see both the distinct

elements of a system or situation and the complex and

changing interaction among those elements

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Systems Approach• A perspective for viewing problems than a

school of thought

• Organization is a system or an entity of interrelated parts ,one part of system effects the other automatically

* E.g. : Offering low compensation to job candidates will affect product quality

(“Low quality “employees –accept low wages- produce low quality goods)

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Systems Approach* Organization is an open system – one that

interacts with environment* It transforms input into output supplies to

outside world* Outputs are perceived as valuable ,organization

prosper and survive * Feedback loop indicates that acceptance of the

outputs by society gives the organization new inputs for revitalization and expansion

* Managers can benefit from by recognizing that whatever work they undertake should contribute something of value to external people (such as customers and clients).

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Contingency approach* Business organizations are open and

adaptive system * Open and adaptable systems approach

which is called contingency or situational approach can be adjusted to the demands of changing environmental situations

* Recognizing all subsystems of an organization and supra – system of environment, are interconnected and interrelated, and by analyzing their interrelationships, it helps the management in finding solutions to specific situations.

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Total Quality Management Focuses on managing the total organization to deliver

better quality to customers High-quality values throughout every activity within a

company, with front-line workers intimately involved in the process

Four aspect are : Employee involvement, focus on the customer,

benchmarking, and continuous improvement, often referred to as kaizen.

TQM is not a quick fix, but companies such as General Electric, Texas Instruments, Procter & Gamble, and DuPont achieved astonishing results in efficiency, quality, and customer satisfaction through total quality management.

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Contemporary Management Tool

Customer Relationship Management Using the latest information technology to keep in close

touch with customers and to collect and manage large amounts of customer data.

Helping employees and managers act on customer insights, make better decisions, and provide superior customer service

63 percent of surveyed managers reported their companies used CRM in 2008 as against 35% companies used CRM in 2000.

Provides a tremendous boost to customer service and satisfaction by knowing really what they want

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Contemporary Management Tool

Outsourcing* Contracting out selected functions or activities to

other organizations that can do the work more cost efficiently

Supply Chain management • Managing the sequence of suppliers and purchasers,

covering all stages of processing from obtaining raw materials to distributing finished goods to consumers.

• A network of multiple businesses and individuals that are connected through the flow of products or services.

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