Keys to Management

1. The manager’s role

Our society is made up of all kinds of organizations, such as companies, government departments, unions, hospitals, schools, libraries, and the like. They are essential to our existence, helping to create our standards of living and our quality of life. In all this organizations there are people carrying out the work of manager. They have a responsibility to use the resources of their org. effectively and economically to achieve its objectives.

A French industrialist, Henry Fayol, wrote in 1960 a classic definition of the manager’s role. He said that to manage is to ‘forecast and plan, to organize, to command, co coordinate and to control’. This definition is still accepted by many people today, although some writers on management have modified Fayol’s description. Instead of talking about ‘command’, they say a manager must motivate or direct and lead other workers.

In most companies the activities of manager depend on the level at which he is working. Top manager, such as chairmen and directors, will be more involved in long range planning, policymaking, and the relations of the company with the outside world. They will be making decisions on the future of the company, the sort of product lines it should develop, how it should face up to the competition, whether it should diversify. On the other hand middle management is generally making the day-to-day decisions, which help an organization to run efficiently and smoothly. They must respond to the pressures of the job, which may mean dealing with an unhappy customer, meeting an urgent order, chasing up suppliers or sorting up a technical problem. They spend a great deal of time communication, coordinating and making decisions affecting the daily operations of their organization.

An interesting modern view on managers is supplied by an American writer, Mr. Peter Drucker. In his opinion, the managers perform 5 basic operations. Firstly, managers set objectives. They decide what they should be and how the organization can achieve them. Secondly, managers organize. They must decide how the recourses of the company are to be used, how the work is to be classified and divided. The third task is to motivate and communicate effectively. Managers must be able to get people work as a team and to be as productive as possible. The forth activity is measurement. Having set targets and standards, managers have to measure the performance of the organization, and of its staff. Finally, Mr. Peter Drucker says that managers develop people, including themselves. They help to make people more productive, and grow as human beings. Successful managers are the people, who command the respect of workers and who set high standards. Good managers must bring character to the job. They are people of integrity, who will look for that quality in others.

2. Frederick W.Taylor, scientific management

No one has had more influence on managers in 20s century than Frederick Taylor, an American engineer. He said a pattern for industrial work, which many others had followed, and although his approach to management has been criticized, his ideas are still of practical importance.

T. founded the school of scientific management just before the First World War. He argued that work should be studied and analyzed systematically. The operations required to perfume a particular job could be identified then arranged in a logical sequence. After this was done, workers productivity would increase, and so would his/her wages. The new method was scientific. The way of doing a job would no longer be determined by guesswork. Instead, management would work out scientifically the method for producing the best results.

When T. started work in the end of 19s century, the industrial revolution was in full swing. Factories were being set up all over the USA. There was a heavy investment in plant and machinery, and labour was plentiful. He worked for 20 years with the Midvale Steel Company. Throughout this time, he studied how to improve the efficiency of workers on the shop floor. He conducted many experiments to find out how to improve their productivity. His solutions to these problems were based on his own experience.

T. criticized management and workers. He felt that managers were not using the right methods and that workers did not put much effort into their job – they were always ‘soldering’. He wanted both groups to adopt a new approach to their work, which would change their thinking completely. The new way was as follows:

1. each operation of a job was studied and analysed;

2. using this info, management worked out the time and method for each job, and the type of equipment to be used;

3. work was organized so that the worker’s only responsibility was to do the job in the prescribed manner;

4. men with the right physical skills were selected and trained for the job.

The tasks of management were: observing; analyzing; measuring; specifying the work methods; organizing and choosing the right person for the job.

T. approach produced results! He made a lasting contribution to management thinking. His main insight, that work can be systematically studied to improve working methods and productivity, was revolutionary.

The weakness of his approach was that it focused on the system of work, rather than on the worker. With this system the worker becomes a tool in the hands of management. Another criticism is that it leads to de-skilling because the task is simplified, workers become frustrated. Finely some people think that it is wrong to separate doing from planning. A worker will be more productive if he/she is engaged in such activities as planning, decision making, controlling and organizing.

3. The Quality of Working life

Over the last thirty years, a new approach to management has been developing. The main idea was that the way to increase worker’s efficiency is to improve their job satisfaction and motivation. Followers of QWL have been trying out various methods of making work more interesting. These include job enlargement and job enrichment and new forms of group work.

With job enlargement, the worker is given additional tasks to perform. Job enrichment involves giving extra responsibilities to workers such as production planning, quality control and technical development of equipment. In some organizations, special types of work groups have been formed where workers share responsibility for certain tasks (e.g. at Volvo car plant).

The basic idea of QWL is that a worker should have an interesting, even challenging job. QWL encourages managers, therefore, to be sensitive to the need of employees.

The roots of QWL movement can be traced back to the 1920s and 1930s. Numerous studies were carried out . Their aim was to evaluate the factors influencing productivity. However, the researchers soon directed their attention towards studying people, esp. their social relationships at work and their morale. This led them to look for the human factor influencing efficiency.

A great deal of studies were directed by Elton Mayo, a Harvard University psychologist. He directed a series of experiments on how working conditions affected output. It was found out that there was an increase in productivity whether conditions such as lunch times, rest periods, wall colors, pay and temperature were made better.

The researchers later came to conclusion that social relations among workers, and between workers and their bosses affect output, the quality of work and motivation. The good relationships and social contacts make the work more enjoyable. Another important finding was that a worker need more than money and good working conditions to be productive. The feeling of belonging to a group and his status within that group, strongly affect his behavior.

It is said that Elton Mayo founded the Human Relations School, whose offspring is the QWL movement, and he changed the course of management thinking completely/entirely.

4. Decision-making

In carrying out management functions, such as planning, organizing, motivating and controlling a manager will be continually making decisions. Decision-making is a key management responsibility. Some decisions are of the routine kind. They are decisions which are made fairly quickly, and are based on judgement. Other decisions are often intuitive ones. They are not really rational. The manager may have a hunch or a gut feeling that a certain course of action is the right one. He will follow that hunch and act accordingly.

Many decisions are more difficult to make since they involve, problem-solving. Very often they are strategic decisions involving major courses of action which will affect the future direction of the enterprise. In practice, decisions are usually made in circumstances which are not ideal. They must be made quickly, with insufficient info. It is probably rare that a manager can make an entirely rational decision.

When a complex problem arises, the manager has to collect facts and weight up courses of action. A useful approach to decision-making is as follows: the process consists of 4 phases:

1) defining the problem. The manager must identify and define the problem. And it is important that manager does not mistake the symptoms of a problem for the real problem he must solve. At the early stage, he must also take into account the rules and principles of the company which may affect the final decision. These factors will limit the solution of the problem. Rules and policies of the company act as constraints, limiting the action of the decision-taker.

2) analyzing and collecting information. The second step is to analyze the problem and decide what additional information is necessary before a decision can be taken. Getting the facts is essential in decision-making, because making decisions involves a degree of risk. It is the manager’s job to minimize that risk.

3) working out options. Once the problem has been defined and the facts collected, the manager should consider the options available for solving it. This is necessary because there are usually several ways of solving a problem (a number of actions): introducing new products, advertising, refurbishment etc. In some situations, one of the options may be to take no action at all.

4) deciding on the best solution. Before making decision, the manager will carefully assess the options, considering the advantages and disadvantages each one. Having done this, he will have to take a decision.

Before making a decision, the manager has to carefully assess the options, considering the advantages and disadvantages of each one. Perhaps he will compromise, using more than one option. Having done this, he will have to take a decision.

5. Top management – planning and strategy

The top management of a company have certain unique responsibilities. One of their key tasks is to make major decisions affecting the future of the organization. These strategic decisions determine where the company is going and how it will get there. For example, top managers must decide which markets to enter and which to pull out of; how expansion is to be financed end so on.

Before doing any kind of strategic planning, the management must decide what is the mission and purpose of their business and what it should be in the future. In other words, they must know why the business exists and what its main purpose is. Deciding the mission and the purpose is the foundation of any planning exercise.

One example will make this point clear. Most people have heard of Marks and Spencer, one of the biggest and most successful retailers in the world. Michael Marks, as the owner of penny bazaars, and his cashier Tom Spencer became public company after opening 9 market stores. At that point, they could have rested on their laurels. However, around that time, they developed a clear idea of M&S mission and purpose. Their later success was founded on this idea. Their company was in business to provide goods of excellent quality, at reasonable prices, to customers from the working and middle classes. This became the overall objective of M&S company. Providing value for money was their mission and their purpose.

Having decided on its mission and purpose, an organization will have worked out certain more specific objectives. It could be increasing market share, producing new model of car in the medium-price range and so on.

As soon as company has established its medium-term objectives, it can draw up a corporate plan. Its purpose is to indicate the strategies the management will use to achieve its goals.

Before deciding strategies, the planners have to look at the company’s present performance, and at any external factors which might affect its future. To do this, it carries out an analysis, sometimes called SWOT analysis (strengths, weaknesses, opportunities and threats). First organization examines its current performance, assessing its strength and weaknesses. It looks at performance indicators like market share, sales revenue, output and productivity. And also examines its resources – financial, human, products and facilities. Next, the company looks at external factors, from the point of view of opp. and threats. It is trying to assess technological, social, economic and political trends in the market where it is competing.

Having completed the SWOT analysis the company can now evaluate its objectives and perhaps work out new ones. They will ask themselves questions about growth rate, new markets to break into etc. The remaining task is to develop appropriate strategies to achieve the objectives. So that is why company planning and strategic decision-making are key activities of top management.

6.Goal-setting (MBO)

Management by Objectives (MBO) is a system which was first described by Peter Drucker in his book ‘The practice