THEORIES AND PRACTICES OF MANAGEMENT THOUGHTS

THEORIES AND PRACTICE OF MANAGEMENT THE CONCEPT OF MANAGEMEENT A precise definition of management is not simple because the term management is used in a variety of ways. Being new disciplines, it has drawn concepts and principles from a number of disciplines such as economics, sociology, anthropology, and statics and so on. The result s that each group of contributors has treated management differently, e.g. economists have treated management as a factor of production, sociologists have treated it as a class or group of persons, practitioners have treated it has a process comprising different activities. Naturally all those divergent groups view the nature and scope of management from their own point of view. Thus taking, all these points of view together, it becomes difficult to define management in comprehensive way. In the present context, the term is used in three alternative ways. i) Management as discipline ii) Management as a group of people iii) Management as a process iv)Management as a profession MANAGEMENT AS A DISCIPLINE Discipline refers to a field of study having well-defined concepts and principles When mgt refers as discipline, it includes various relevant concepts and principles, the knowledge of which aids in managing. From this point of view, management can be treated either an art or science. 1. MANAGEMET AS SCIENCE The essential elements of science are as follows; 1. Science is systematized by body of knowledge pertaining to a particular field of inquiry .It is systematized in the sense that it establishes cause and effect relationship between different variables. 2. It contains underlying principles and theories developed through continuous observation, experimentation and research. 3. The principles have universal applicability. They can be applied under different situations barring a few expectations which can be logically explained. The principles are verifiable and lead to predictable results. 4. The organized body of knowledge can be taught and learn in the classroom and outside. Physics, chemistry, mathematics and Economics are some of examples. Therefore management is science because it contains all the essentials of science as follows. 1. In the management there is a systematized body of knowledge e.g functions of management. Principles and theories are now available in every area of management e.g there are several principles to serve as guidelines for effective delegation of authority. 2. Principles of management have been evolved through practical experience and theoretical research over several decades. 3. Managerial principles have a wide and repetitive range of application. Application of management theory can be demonstrated through the quasi-laboratory method of case studies 4. Management theory and principles can be taught in classrooms and in industry. NATURE OF SCIENCE OF MANAGEMENT Management is a social science like economics because it involves the study of human behavior. Its principles are not hard and fast laws like those of physics or chemistry. Rather, they are flexible, guidelines to be modified in different situations These cannot predict with certainty future behavior. This is because living and complex human beings in dynamic situations cannot be studied under controlled laboratory conditions. Validity of the principles cannot be tested through experiments. This is true not only of management but of all social sciences. Moreover, management is a comparatively young and a growing science which developed in the 20th centuries. It s not fully mature and management scientists cannot explain clearly. Why and how a human being behaves in a particular way and will behave in the same way in future. Therefore, management is called an inexact science or soft science. The human element and environment dynamics in management make it an imperfect science. Management is an applied science as a manager has to apply the principles just like a medical or legal practitioner. Management also is an interdisciplinary science as it draws freely on the knowledge from several other sciences like economics, mathematics, sociology, psychology and Anthropology Thus management is neither exclusively an art nor exclusively a science but a combination of both. Essentially managing is the art of doing and management is the body of knowledge which underlies Art. 2. MANAGEMENT AS AN ART Art is a personalized process and every artist has his own style. Art is essentially creative and the success of an artist is measured by the results he achieves .Art is practice-based and perfection in it requires continuous practice over a long period of time. Thus the main elements of an art are. (a) Personal skills (b) Practical know how (c) Result orientation (d) Creativity and (e) Constant practice aimed at perfection. Management is basically an art because of the following reasons 1. Like any other artist a manager applies his knowledge and skills to coordinate the efforts of his people. 2. Management seeks to achieve concrete practical results e.g. profit, growth, social services etc in a given situation. 3. Like any other art management is creative. It brings out new situation and converts resources into output. 4. Management is a personalized process. Every manager adopts his own approach towards problems depending upon his perception and the environmental conditions. 5. Effective management leads to realization of organizational goals. The success of a manager is measured by the results he achieves. It is very much like saying that the proof of the pudding lies in eating. Mastery in management requires a sufficiently and long period of experience in managing. The managerial art can be refined through continuous practice. MANAGEMENT AS A GROUP OF PEOPLE OR AS A TEAM Management consists of all personnel having managerial responsibilities i.e. those individuals who guide and direct the efforts of other individuals to achieve specified objectives. Managers occupy positions at different levels of authority but perform the same basic functions. Top level managers have greater authority than middle level managers who in turn, have greater authority than operating managers. In this way a system of authority is called chain of command is created in every organization The management group consists of different types of managers. 1. Professional managers- formally trained in management and divorced from ownership. 2. Family managers- owner managers having little formal training and 3. Civil servant managers- persons occupying managerial positions in public sectors undertakings. Top managers have become elite class or leading group in modern society on account of the enormous power and prestige at their command. Also management as a team or group of people includes all those personnel who perform managerial functions in organization. MANAGEMENT AS A PROCESS In studying management discipline, we generally refer to management as a process. A process can be simply be defined as a systematic method of handling activities. However, the management process can be treated as a complex one which can be referred to as an identifiable flow of information through interrelated stages of analysis directed towards the achievement of an objective or set of objectives. Management is a concept of dynamic rather than static existence in which events and relationships must be seen as dynamic, continuous and flexible. Thus, management as a process includes various activities and sub-activities. In simple way management can be defined as what managers do. However, this definition, through is simple suffers from two limitations. 1. There is a problem in identifying the people in the organization who can be called managers because there is no informality in the titles given to the people. E.g. people may be called as president, chief executive, managing director at the top level. Similarly at the middle level; they can be called as executive or accountant and at lower level as supervisors. Therefore it becomes difficult to identify who is a manager and who is not, whose activities should be treated as managerial and whose activities as non- managerial. Thus what should be studied is not clear. 2. Even if the problem of identifying people as managers is solved, the problem of identifying managerial activities still exists because people known as managers may perform different kinds of activities, some of which may not really be a managerial. Therefore, unless some yardsticks are prescribed to distinguish between managerial and non-managerial activities, managerial activities can not be identified. In order to overcome the limitations, the total activities of an organization, can be divided into two. (a) Operational (b) Managerial Those activities which are of operative nature through which actual work is accomplished such as handling machine by workers, putting the materials into the godown etc are called operational activities. Some activities are performed to get things done like a supervisor instructing a worker to do a particular job or marketing manager instructing his sales man to contact the customers to sell the product etc. such activities are different from the first group and are known as managerial activities. Thus, management can be defined as the process of getting things done by others. Management is invariably defined as the process of getting things done through the efforts of others; getting from where we are to where we want to be with the least expenditure of time, money and efforts or coordinating individual and group efforts towards super ordinate goals, Though these definitions of management as a process use different terms all of them convey the same set of meaning in their final analysis. MANAGEMENT AS PROFESSION Profession is an occupation for which specialized knowledge, skills and training are required and the use of these skills is not meant for self satisfaction but these are used for larger interests of the society and the success of the use of these skills is measured not in terms of money alone. Thus all professions are occupations in the sense that they provide means of livelihood. Characteristics of profession 1. Existence of an organized and systematized body of knowledge. 2. Formal method of acquisition of knowledge. 3. Existence of an association with professionalization as its goal. 4. Formulation of ethical codes 5. Service motives Let us discuss the extent to which all these characteristics are found in management to determine whether management is profession or not. 1. Existence of knowledge A profession emerges from the establishment of fact that there is a body of knowledge which cannot be skirted around but has to be studied for being a successful professional. The development of knowledge in management field has been due to the need for managing complex and large organizations in a better way. This management satisfies the requirement of a profession in the form of existence of knowledge. However the concept of management is still evolving and continuously new principles are being developed though this does not affect its status as being a profession. 2. Acquisition of knowledge. An individual can enter a profession only after acquiring knowledge, skills through formal training. A professional is one who practices a profession and is regarded as an expert since he has mastery of a specific branch of learning upon which his occupation is based so that he may offer services to his clients. However, the emphasis is put on the initial acquisition of knowledge through some formal method. Therefore management graduates can put in better performance in the organization because of their familiarity with the various techniques of management 3. Professional Association A professional association consists of firms and individuals whose membership is based on common professional, scientific or technical aims. The representative body of professional is needed to regulate and develop the professional activities. The body may also prescribe the criteria for individuals who want to enter the profession. 4. Ethical Codes. For every profession, some ethical standards are provided and every individuals of the profession is expected to be maintained conformity with these standards. The need for the ethical codes arises because of the fact that occupations whose practitioners have mastery over an area of knowledge have degree of power by virtue of the expertise and this power can be used for the benefit of the professionals at the cost of the society. This has resulted in many occupations issuing a code of ethics of professional practice so that clients may know the standard and commitment that they should receive from a professional. In management also, a code of conduct has been formulated to suggest the behavioral pattern for professional managers. Though there is a lack of universally accepted ethical codes for managers through the world. In most of the countries, managers are supposed to be socially responsible and it is their duty to protect the interest of all parties associated with the organization. These parties may be customers, suppliers, employees, financiers, creditors, government, and the general public 5. Service Motives While ethical code provides the behavioral motive concept suggest that professionals should keep social interest in their mind while charging fees for their professional services, it is essential because the monetary value of professional service cannot be measured easily in the absence of market mechanism except the competition among the professionals themselves. Since the professionals are in position to charge higher fees by virtue of their expert knowledge, hence associating high monetary value for their service, the success of any profession is measured not in terms of money it earns but the amount of social service it provides. This is true for management also. Management is an integrating agency and its contribution in the society by way of integrating various resources into productive units is very important for the stability of the society. This contribution of management cannot be measured in terms of money alone because without the integrating effort of management, resources worth millions of money are useless. FEATURES OF MANAGEMENT Features of management are as follows 1. Organized Activities Management is a process of organized activities. Without organized activities, two groups of people cannot be involved in the performance of activities. Where a group of people are involved in working towards common objectives, management comes into existence. The organized activities may take variety of forms ranging from a tightly –structured organization to every loosely-knit organizations. There can be different organizations but all have one thing in common, they want to progress efficiently towards the achievement of their objectives, through the coordinated efforts of people. This is done by management process. Therefore, a single individual pursues his personal objectives, management has no operational objectives, and management has no operational meaning. However, when an attempt and is made to channel the individuals quest for personal objectives along the lines that contribute to the overall objectives of the group, management becomes the means by which random action is controlled. 2. Existence of objectives. An objective or set of objectives should exist towards which the organized group activities are directed. Without objectives it becomes difficult to define the direction where organized group activities would lead to. The existence of objective is basic criterions of every human organization because all organizations are deliberate and purposive creation and therefore, they should have some objectives are agreed upon by the members or the organization. The organizational objectives are the desired state of affairs which an organization attempts to realize. These realizations of objectives are sought through the coordinated efforts of the people constituting an organization. 3. Relationship among resources. Organized activities meant to achieve common goals are brought about to; establish certain relationships among the available resources. Resources include money, machine, materials and people. All these resources are made available to those who managed; they apply knowledge, experience principle for getting the desired results. Thus the essence of management is integration of various organizational resources. However, since people at operative do the things by the use of various physical and other resources, it is more important for the management to take care of integration of human resources. Thus management is concerned with the proper utilization of human resources which in turns utilize .other resources. 4. Working with and through people. Management involves working with people and getting organizational objectives achieved through them. The idea of working through people interpreted in terms of assigning activities to subordinates. The superior- subordinate relationships are created because of organized activities. Through the process of assignment and reassignment of activities the actual work is performed by people at operative level which is the lowest level in the organization. Thus, a sizeable proportion of management principles relates to how human beings can put for better efforts in the organization. 5. Decision making. Management process involves decision making at various levels for getting things done by others. Decision making basically involves selecting the most appropriate alternative out of several, the quality of alternatives which a manager selects determines the organizations performance and the entire future of the organization rests on the degree to which the right decisions are made by managers, therefore, the success of failure of managers can be judged by the quality of the decisions that they make. IMPORTANCE OF MANAGEMENT Management has been important to the daily lives of people in groups since long. The importance of management can trace in the context of emergence of large sized organizations. The management of these organizations has become much more complex than what is used to earlier. Along with the size, another dimension which has added to the complexity of managing is the changing nature of society and its various constituents, therefore, the issue before the present day managers is how to take care of these changes so that organizations achieves their objectives. Thus management has become crucial not only for the organizations but for the society too. The survival and growth of an organization depends largely on the competence and character of its management. Every organization needs repeated stimulus which only managers can provide, management is the dynamic life growing element in every organization. Without management the resources of production remain the resources and can never become output. Organizations stand or fall on the quality of their management because sounds management provides the following benefits: 1. Achievements of group goals Management enables an enterprise to achieve its desired objectives through proper planning and control. It decides what should be done and how. It lays down the long-term and short- term goals keeping n mind the resources of the organizations. Management maintains order and coordination and without that will be utter chaos. Management also creates a sound organization structure that provides specialization. Through well organized system of direction and control management keeps a close watch on the activities of the organization. Thus mgt makes an organization successful through sound resources planning and effective control. 2. Optimum utilization of resources Materials, machinery and money are physical factors of production. The efficient use of these resources depends upon the efficiency and motivation of workers. Management makes the workers efficient and motivated through training, supervision and inspiring leadership. Managers guide and motivate workers towards best performance. They tell workers what to do and how to do their jobs. Managers develop a spirit of mutual co-operation and sense of responsibility among workers. Fulfillments of social obligation sound management monitors environment of business and makes necessary changes in business policies and practices so that to keep consumers and workers satisfied. In this way managers help an enterprise to fulfill its obligations towards different sections of society. Management balances and integrates various interests in group efforts. 3. Economic Growth. Management is the catalyst of economic growth. We no longer talk of capital and labour ‘Development is a matter of human energies than of economic growth, and the generation of human energies is the task of management. Management is the mover and duty is the consequence. 4. Stability Management ensures the survival of an organization in a fast changing environment. It coordinates the activities of different departments in an organization and maintains team spirit amongst the personnel. Just as mind controls the body, similarity management directs and controls the organization to keep it on the right track. 5. Human Development Management is not simply the direction of things but the duty of men. It improves the personality and caliber of people to raise their efficiency and productivity. A good manager serves as a friend and guides his subordinates. 6. Meet the challenge of change. Management is the catalytic force that enables an organization to face the challenge of change. The environment of business has become very turbulent. Managers maintain a dynamic equilibrium between an enterprise and its environment through innovation and creativity. Thus good management achieves both economic and social objectives by making best use of human and material resources and by providing satisfaction to people. Therefore management is an art of securing maximum results with a minimum of effort so as to ensure maximum prosperity for the employer and employee and give the public the best possible service. The recent years the role of management has increased due to the following challenges i. Growing size and complexity of business ii. Changing technology iii. Need of optimum utilization of resources iv. Cut-throat competition in the market v. Uncertain business environment vi. Increasing expectations of social groups vii. Growth of trade union movement NATURE OF MANAGEMENT The nature of management can be described as follows 1. Multidisciplinary Management is basically multidisciplinary. This implies that, although management has been developed as a separate discipline, it draws knowledge and concepts from various disciplines. It freely draws ideas and concepts from such disciplines as psychology, sociology, anthropology, economics, ecology, statistics, separations, operation research, history etc. Management integrates the ideas and concepts taken from these disciplines and presents new concepts which can be put into practice for managing the organizations. In fact the integration of knowledge of various disciplines is the major contribution of management and this integrated discipline is known as management. Therefore the contributions in the field can be expected from any discipline which deals with some aspects of human beings. 2. Dynamic nature of principles Principal is a fundamental truth which establishes cause and effect relationships of a function. Based on integration and supported by practical evidences, management has framed certain principles. However these principles are flexible in nature and change with the changes in the environment in which an organization exists. Because of the continuous development n the field, many older principles are being changed by new principles. Continuous researches are being carried on to establish principles in changing society and no principle can be regarded as a final truth. N fact there is nothing permanent n the land slide of management. 3. Relative and not absolute principles Management principles are relative, not absolute and they should be applied according to the need of the organization. Each organization may be different from others. The difference may exist because of time, place, social cultural factors etc. However, individuals working within the same organization may also differ. Thus a particular management principles of management should be applied n the light of prevailing conditions. 4. Management: Science or art. There is a controversy whether management is science or art. However, management is both science and art. 5. Management as profession Management has been regarded as a profession by many while others argue that management has not achieved the status of profession. 6. Universality of management Management is a universal phenomenon. However management principles are not universal applicable but are to be modified according to the needs of the situation. The nature of management suggests that s a multidisciplinary phenomenon, its principles are flexible relative and not absolute it is both science and art. It can be taken as a profession and finally s universal. MANAGEMENT V/S ADMNSTRATION It is desirable to resolve the terminological conflict between management and administration as there is often a terminological conflict between the two. Some authors suggest that there is no fundamental difference between management and administration. Whether difference between the two exists, t exists only n terms of their usage n different walks of life. Other authors suggest that these two terms are different and involve different set of activities. Therefore, resolution of this conflict is necessary. At the initial level of development of management thought, no distinction was made between management and administration and both of the terms was raised by Olver Sheldon (1923) in his book the philosophy of management when he emphasized administration as a decision making function and management as execution function. After that distinction between the two terms was emphasized by many and terminological conflict proceeded further. Various views expressed in this regard have led to the emergence of three approaches which are as follows 1. Administration is above management 2. Administration is a part of management 3. Management and administration are same ADMINISTRATION IS ABOVE MANAGEMENT According to many classical thinkers, administration is above management so far as different functions n the organization are concerned. They perceive that both administration and management activities are different though both of them may be performed by a single individual in an organization. The general view is that administration is relates to policy formulation and management relates to policy execution and these two activities are not the same. Eg Spriegal states that “Administration is that phase of business enterprise that concerns itself with the overall determination of institutional objectives and the policies necessary to be followed in achieving those objectives. Management on other hand, s an executive function which is primarily concerned with carrying out broad policies lay down by the administrators” FUNCTONS IN THE ORGANISATON The basic approach of these authors is that administration determines the basic framework of the organization within which managerial functions are undertaken. Since these sets of functions are different, different sets of qualities are required. ADMINISTRATION IS A PART OF MANAGEMENT European school of thought holds that management s a comprehensive term and administration s a part of t. Brench (1985) argues that management is the generic term for the total process of executive control involving responsibly for effective planning and guidance of the operations of an organization. Administration is that part of management which is concerned with the installation and carrying out of the procedures by which the programme is laid down and communicated and the progress of activities is regulated and checked against plan. Other authors in their opinion say that management comprises both policy making and execution. Administration is that part of management which involves dong routine things in a known setting. The other and more important part of management is risk taking, dynamic and innovative function. Thus the European view of point is exactly opposite to the American view of point 3. ADMINISTRATION AND MANAGEMENT ARE THE SAME (ONE) According to the third approach which is the most popular and practical one, management and administration are same. Both involve the same functions, principles and objectives. Fayol says that “all undertakings require planning, origination, command, coordination and control and in order to function properly all must observe the same general principles. He added by saying that we are no longer confronted with several administrative science but with one which can be applied equally well to public and private affairs. Thus there is no difference between management and administration. McFarland, who made distinction between management and administration in an earlier addition of his book, revised his stand and viewed that, it is difficult to make distinction between management and administration; both are similar to each other. Thus management and administration are synonymous. The difference between the two terms lies mostly in their usage. N different countries or different fields of human organizations E.g. Lepawsky has made observation that “The British conception seems to be the general European usage in which management is given a broader meaning than administration. In American usage, administration includes management and organization. The distinction between the two terms may be drawn by analyzing the origin of the word administration. Its origin is found in the bureaucratic structure of government or in regulations of some laws. The government often uses the word administrator instead of a manager to handle and manage its affairs. When handling the government affairs those administrators are to execute the broad policies laid down by the government, though they may also participate in policy formulation. On the other hand management is normally used in business sphere.. However, whether administration is used in non- business field and management is used in business field does not make fundamental distinction between the two because of similarity of the process involved in these. In practice the two terms are used interchangeably because both involve the same principles and functions. In order to resolve the terminological conflict between administration and management, management may be classified into 1. Administrative management 2. Operative management Administrative management involves determination of objectives and policies where as operative management is primarily concerned with the execution of plans for the achievement of objectives. At every level of management an individual manger performs both types of functions. Every manager spends a part of his time on administrative management and the remaining time on operative management Administrative and management comprises Board of directors Managing directors Production manager Plant superintendent Supervisor It is clear from the figure that higher-level managers spend major portion of their time on decision making and policy formulation (administration) while lower level managers spend comparatively greater time on execution of plans and policies (management). But every manager, irrespective of his position or level in the organization, must plan as well as execute the plans. This approach appears to be more logical because of two reasons 1. Two separate of sets of people are not required to perform administrative and managerial functions 2. Planning and doing are two faces of the same coin and it is not desirable to separate them DISTINCTION BETWEEN ADMINISTRATION AND MANAGEMENT The following are the distinction between management and administration. NOTES ARE MISSING UNIVERSALITY OF MANAGEMENT Universality of management is another controversy which exists in management. As the area of management has increasingly commanded worldwide interest and recognition, the question whether it is a science with universal application has concerned scholars and practitioners alike. Settlement of the controversy is necessary to determine the extent to which managerial knowledge developed in one country can be transmitted to other countries. F it is universal, there is no problem of transferability of management knowledge. However in its absence, there is serious question on the universal use of management knowledge developed in a country. The concept of universality of management suggests that transmission of management knowledge may be undertaken by 1. Managers from one-industrially developed country working in developing countries 2. People from a developing country coming to study and work in an industrial- advanced country and returning back to their countries. 3. through training and development programmes for managers n developing country. Thus managerial knowledge can be transferred from one person to another person, from one firm to another firm in the same country and from one country to another country. This transferability of managerial knowledge is meaningful only when it has universal application. However, opinions about universal applicability of management are uniform. There are two divergent groups of arguments 1. One suggests that management is universal 2. Another suggests that management s not universally applicable Therefore, it is essential to overcome this problem so that managers can take adequate precaution while applying management concepts developed n other countries most in developed countries. ARGUMENTS FOR UNIVERSALITY Experts subscribing to the concepts of universality of management suggest that the basics of management are universal and can be found n all types of originations situated n any country or culture. Different researches about the universality management come with different conclusions. E.g. Richman (1997) has found that the evolving soviet approach to management utilizes that management functions that s planning, organizing, coordination, control and direction, leadership, motivation and staffing which have been essentially the same as long-held American concepts. Similarly any other studies also support the view that management fundamentals throughout the world are almost the same, only their applications may differ because of various factors Thus, management can be treated as universal phenomenon. Following arguments can be advanced to suggest the view of universality of management 1. Management as a process Management as a process is universal. It s argued that management as a process is found in all organized activities irrespective to country, culture or size. The various elements of management process that is planning, organizing, staffing, directing and controlling are universal for all organizations and as a manager, each one must at one time or another, carry all these duty characteristics of managers. Only the intensity of a particular element may differ depending on the variables affecting management practices. This is the principle of universality of management. It implies that any theory or principle about particular managerial function will apply to all managers irrespective of their level in the organization, culture or a country 2. Distinction between management fundamentals and techniques In order to ascertain the universality of management, it is proper to make distinction between management fundamentals and management techniques because it is the specific techniques which vary according to the needs of the situation. Management fundamentals are the basic principles and theories while management techniques are the tools for performing managerial functions. Whereas management techniques may differ from country to country management fundamentals will remain the same. 3. Distinction between management fundamentals and practices Universality of management suggests that management fundamentals are the same only practices differ. This is so because management is both science and art. The most productive art s always based on an understanding of the science and arts are complementary. The art of managing or the practice of managing makes use of organized knowledge that is science. However, its practice is subjected to variations under different conditions. This may be true with science also. URGUMENTS AGAINST UNIVERSALITY According to this view, management is entirely situational and there is nothing like universal principles management. Therefore there is no such a way as the right way for a manager to operate or behave. There is only ways that are appropriate for specific tasks of specific enterprise under specific conditions faced by managers of specific temperaments and styles Thus, what managers do depends on the circumstances with the results. With the results, we have various management principles which can be applied effectively most of the time but they cannot be applied effectively all the time. This happen because of lack of universality of management principles which are effective n one country may not be effective n another country. Not only may that even two organisatons within the same country apply different management principles. According to different researches findings in 1960s, 1970s various studies were conducted to test the universality of management and most of these studies have concluded that application of management principles varies in different countries because of differences in characteristics of these countries. Most of these studies have taken limited number of countries for comparison purposes. During 1980 and 1990s Hofstede a Dutch management scholar, studied the management practices of 40 countries as concluded that not a single management principle has been applied uniformly in all these countries The argument against the universal application of management principles suggest that there are certain factors which affect the application of principle or a set of principles of management. These are 1. Cultural characteristics 2. Management philosophy 3. Organization objectives CULTURAL CHARACTERISTICS The application of management principles is determined by the culture of the country. Culture is a set of beliefs, attitudes and values that are shared commonly by the members of the society. Culture affects people’s behavior significantly and any people oriented process. Therefore management is affected by the cultural characteristics of the country concerned. Since cultural characteristics of one country differ from others hence applicability of management principles differ too. Hofstede (1993) has concluded that people vary on five dimensions as follows 1. National culture 2. Individualism and collectivism 3Uncertainty avoidance 4. Masculinity 5. Time orientation 1. Individualism and collectivism Hofstede (1993) has concluded that people differ in terms of individualism and collectivism Individualism is the extent to which people place value on themselves, they define themselves by referring themselves as singular persons rather than as part of group of organization. For them individual tasks are more important than relationships .Countries that value individualism are USA, Great Britain, Australia, Canada, Netherlands and News land Collectivism is the extent to which people emphasize the good of the group society. They tend to base their identity on the group or organization to which they belong. At work this means that relationships are more important than individuals or tasks; employer-employee links a more like family relationships. Countries that value collectivism are Japan, Columbia, Pakistan, Singapore, Venezuela and Philippines. 2. Power distance Power distance shows the degree to which people in a country accept that power. Power in the organizations can be distributed equally or unequally. Power distance is low when there is equal power distribution and it is high when there is unequal power distribution. People of a country with lower power distance prefer management practices that allow them freedom of work and self control. People of a country with high power distance prefer management practices that prescribe the work in a structured from with high degree of supervision and control 3. Uncertainty avoidance Uncertainty avoidance is the degree to which people in the country prefer certainty which is the result of structure situation or uncertainty which is the result of unstructured situations. In many countries people prefer unambiguity while n many other countries people can tolerate ambiguity easily. 4. Masculinity Masculinity includes quantity and quality of life. It indicates the degree to which people of a country are assertive and money-minded. In a country which has masculine culture, people put emphasis I quantity of life and prefer assertiveness and competition for acquisition of money and material goods In a country having feminine culture, people put emphasis on quality of life and prefer relationships and shows sensitivity and concern for the welfare of others. 5. Time orientation Time orientation is the degree to which people of a country put emphasis on future or past and present. Thus, people have either long-term orientation or short term orientation In a country having long-term orientation, people look to the future and prefer thrift and persistence. They prefer to work on projects having a distance payoff In a country having short-term orientation, people value past and present and have respect for traditions and social obligations MANAGEMENT PHYLOSOPHY Differences in philosophies of various originations put a limit on a person being a good manager in all types of organizations. Philosophy can mean attitude toward certain activities in a person’s philosophy of doing business. It may be an evaluation or interpretation of what is important or meaningful of life. Every organization, like an individual has philosophy of doing business. Differences of philosophies of various organizations require different kinds of managerial techniques. Even two organizations having different philosophy may require different types of managerial approaches. It may be pointed out that with a given culture, different organizations may adopt their own cultures and management philosophy. ORGANISATIONAL OBJECTIVES The objectives of an enterprise determine the type of management required. The skills, competence and experience of a management cannot as such be transferred and applied to the business organizations and running of other institutions. The basis of this view is that business organizations exist for economic ends and management consists of skills and techniques for attaining these ends. Since the main objective of the business-profit consistent with security and welfare of the business-differs from that of non-business organization, management can transfer only analytical and administrative types of skills ability and experience Transferability of management is determined b the extent of difference between the two types of industries Thus, further way a manager moves n terms of organization and industry characteristics, the longer s the learning period and lower s the extent of transferability. Therefore, it implies that a person cannot demonstrate equal effectiveness n different types of organizations. CONCLUSION The argument for and against the universality of management concept should be analyzed in an integrated way so as to arrive at a particular conclusion. This conclusion is important because developing countries can import managerial know-how and principles developed by the advanced countries if they are universal. An integrated analysis suggests that there is certain management principles which are universal though their practices may differ from country to country or from organization to organization even within the same country. Therefore, the knowledge of management can be transferred from one country to another country. Bulk management knowledge has been developed in the USA from where other countries have borrowed. The process of management transfer has been undertaken n the following ways 1. Through the use of American literature in the curriculum of management education in various countries 2. Through training of managerial personnel of developing countries in the United States 3. Through the consultancy assignment undertaken by management experts from USA n developing countries 4. Through the management practices adopted by multinationals operating n the developing countries ORGANIZATION THE CONCEPT OF ORGANIZATION The classicist has used the term organization in the form of organizing which is a part of management process. Presently the term organization is used in the following ways 1. Organization as entity 2. Organization as group of people 3. Organization as a structure and 4. Organization as a process. ORGANIZATION AS AN ENTITY Most frequent use of the term organization on is an entity and it is referred to as enterprise as a whole like company, corporation, partnership firm e.g. in this form organization is defined as collectivity of people for achieving common objectives. William Scott has defined organizations as a collective of people that have been established for the pursuit of relatively specific objectives on more or less continuous basis. FEATURES OF ORGANIZATION AS AN ENTITY Identifiable aggregation of human beings. The identification is possible because human group is not merely a number of persons collected at random, but it is a group of persons who are interrelated. The identifiable group of human beings determines the boundary of the organisation. Such boundary separates the elements belonging to the organization from other elements in its environment . However the separation is rarely absolute, that is some of elements in the organization will interact with its environment. The amount of interaction can be thought of in terms of permeability of the organization’s boundary. This refers to the flow of both people and information across the boundary. Deliberate and conscious creation. Organization is a deliberately and consciously created human group. It implies that relationship between organization and its members is contractual. The enter in the organization through and can be replaced also. The organisation can also recombine it’s personnel through promotion demotion and transfer. Such deliberate and conscious creation of human groups differentiates between casual or focused gathering having transitory relationships like a mob and social units. Other social units like family community have some conscious planning e.g. family budget, power center (community chief) and replaceable membership (through divorce) but the extent to which these social units are consciously planned and deliberately structured with replaceable membership are much less as compared to organisation. Thus, companies, armies, hospitals e.t.c are included in the category of organization while tribes’ families’ friendship groups e.t.c are excluded. 3. Purposive creation. The organization is a purposive creation i.e. all organizations have some objectives or set of objectives. The objectives are mutual agreed upon by members of the group. An organizational objective is desired states of affairs which the organization attempts to realize. Organizations are contrived social instruments through which society or portion of it, obtained things that either could not be had as easily or cheaply. Organizations are thus, intervening elements between needs and their satisfaction. The success or failure of an organization is measured in terms of achievement of its objectives. 4. Coordination of activities. In the organization there is a coordination of closely relevant activities of the members. The coordination is necessary because all the members contribute to commonly agreed goals. From this point of view the organization must spell out the activities or roles which must be fulfilled in order to achieve the goals. Structure The coordination of human activities requires a structure where in various individuals are fitted. The structure provides power centers which coordinate and control concerted efforts of the organization and direct them towards its goals. Coordination among many diverse individuals is not possible without some means of controlling, guiding and timing the various individuals or groups. The very idea of coordination implies that each individual or units submits to some kind of authority for the sake of achievement of common objective since the individuals are structured in the hierarchy there is also hierarchy of authority and depending upon the size and nature of particular of organization, there may be many centre of authority in the organization. This does not mean that authority is always external coordination can be achieved by self disciplining activities but some kind of authority is essential for coordination in organization. This may vary between complete self- discipline and complete autocracy. 6. Rationality There is rationality in coordination of activities or behavior. Every org. has some specified norms and standards of behavior, such norms of behavior are set up collectively by the individual and every member of the organization is expected to behave according to these norms or standards. The behaviors are governed by reward and penalty system of the organization which acts as a binding force on its members. The desirable behavior is rewarded and undesirable one is penalized. To enforce rationality in behaviors, organization also provides way for substitution of its members. The characteristics differentiate an organization from other social units such as community, family and friendship group e.t.c. Such characteristics are the important from the point of view of their management. In large organization, the members are arranged in a number of hierarchies which present some specific problems besides the usual ones associated with every organization large or small. Such problems may be in form of increased distance between decision centres and actual operative levels. This feature makes the coordination more difficult. ORGANIZATION AS A GROUP OF PEOPLE. An organization comprise with a group of people who enable the organisation to achieve its goals. When organization is referred to as a group of people, it is mostly referred to as different groups created either formally or informally .In this form, an organization has the following features. 1. An organization always refers to people 2. The organization is composed of people who interact among themselves. 3. The interactions are specified by sort of structure i.e. who will interact with whom. 4. The interactions are meant to achieve some sort of objectives. D. ORGANISATION AS A PROCESS The term organization as a process is in the form of process of organizing through which organization structure is created. In the present context, the term organization is mostly referred to as an entity. Whenever it is used as a process it is termed as organizing rather as organization. In this context organizing is through which organization structure is designed. CHARACTERISTICS OF ORGANIZATION The main characteristic of an organization are as follows. 1. Common purpose Every organization exists to accomplish some common goals e.g. a school, a hospital an army e.t.c 2. Division of labour The total work of an organization is divided into function and sub- functions. This is necessary to avoid the waste of time, energy and resources which arises when people have to constantly change from one work to another. It also provides benefits of specialization. 3. Authority structure There is an arrangement of positions into a graded series. The authority of every position s defined. It is superior the position above and subordinate to the below. This chain to the superior- subordinate of relationship is known as chain of command. 4. People: An organization is a group of persons. Therefore activity groupings and authority provisions must take into account the limitations and customs of people. 5. Communication Every org has its own channels of communication. Such channels are necessary for mutual understanding and cooperation among the member of an organization. 6. Coordination There is a mechanism for coordinating different activities and parts of an organization so that it functions as an integrated whole. Cooperative efforts are a basic feature of organization. 7. Environment An organization functions in an environment comprising economic, social, political and legal factors. Therefore, the structure must be designed to work efficiently in a changing environment. It cannot be static or mechanistic. 8. Rules and regulations. Every organization has some rules and regulations for orderly functioning of people. These rules and regulations may be in writing or implied from customary behavior. TYPES OF ORGANIZATIONS There are two major types of organization 1. Formal organizations 2. Informal organization. FORMAL ORGANIZATIONS Formal organisaton refers to the organization structure deliberately created by management for achieving its objective(s). Also Formal organisaton refers to the structure of well defined jobs, each bearing a definite authority, responsibility and accountability. According to classical theorists the formal organization is built on four pillars as follows (i) Division of labor 2. Scalar and functional processes 3. Structure and 4. Span of control These also referred as principle of organisations. From this point of view characteristic of formal organizations are as follows. 1. Organization structure is designed by the top management to fulfill certain requirements performance of necessary activities there by achieving organizational goals. 2. Organization structure is based on the principles of division of labor and efficiency in operations 3. Organization concentrates more on the performance of jobs and not on the individual performing the jobs. 4. The authority and responsibility assigned to each job have to be adhered to by the job holders. Based on the concept of authority and responsibility people are placed in hierarchy and their status is determined accordingly. 5. Coordination among members and their control are well specified through processes procedures and rules. INFORMAL ORGANIZATION Informal organization refers to the pattern of activities interaction and human relationships which emerged spontaneously due to social and psychological forces operating at the work place. Informal oganisation arises naturally on the basis of friends or some common interests which may or not be related with work. Informal oganisation is an unintended and non planned network of unofficial and social patters of human relationships. Formal organization represents the pattern of interpersonal and intergroup relations that develop within the formal organization e.g. friendship groups, religion, home mates (people from the same area or region e.g. CHARACTERISTICS OF INFORMAL ORGANIZATION 1. An Informal organization is a natural outcome at the work place. It is not designed and planned. 2. An Informal organization is created on the basis of some similarity among its members. The basis of similarity may be age, sex, place of origin, social group, religion, personal characteristics, linking’s e.t.c 3. Membership in an informal organization is voluntary. A person may become member of several informal organizations at the same time. 4. Behaviors of members of the informal organization is coordinated and controlled by group norms and not by the norms of the formal organization. DIFFERENCES BETWEEN FORMAL AND INFORMAL ORGANIZATIONS Formal and informal organization may be distinguished in the following ways. Origin Formal organization is created deliberately and consciously by management while informal organization emerges spontaneously on account of socio- psychological forces operating at the workplace. People working together develop certain linking and disliking each other. Purpose. Formal organisation is created for achieving the legitimate objectives of the organization while informal organization created by the members of the organization for their social and psychological satisfaction. 3. Size Formal organisation may be quite large in size particular when these groups are constituted to give representation to various interest groups. But informal groups tend to be small in size so as to maintain group cohesiveness. 4. Nature of groups Formal groups are stable and may continue for a very long period of time while informal groups are quite unstable in nature. They tend to disappear or cease to be attractive for members when changes take place in personal linking and delinking. Members may form alternative groups. 5. Number of informal groups The number of informal groups is larger than the number of formal groups. Moreover, there may be overlapping because an individual may become members of several information groups. 6. Authority Formal organization is bound together by a hierarchical structure in which authority flows from higher to lower levels. Members of a formal group derive their authority from the process of delegation. In informal groups all members are equal although some may command more authority by virtue of their personal qualities. 7. Behavior of members Behaviors of the members in the formal Organization are governed by formal rules and regulations. The rules are normally directed towards efficiency and rationality. In the informal groups or the behavior of the member is governed by norms belief and value of the group. 8. Communication In formal organization communication normally flows through the prescribed chain of command in informal groups communication, pass through the informal channels which do not have one single form. 9. Abolition. Management can abolish the formal groups at any time. But management has no control over informal groups which are the creation of natural desire of human beings to interact. 10. Leadership In Formal Organsation, leadership is vested in managers but in informal organizations leadership is not associated with managership 11. Status. There are sharp status differentials among the members of Formal Organisaton, Such differentials inhibit free interaction and socialization. In informal organization, there may be social rankings among people but these do not prevent free interaction among people. WHY INFORMAL GROUPS ARE FORMED Basic reason for the emergence of the inform groups is that the formal organistion does not satisfy all the needs of employee. Informal, groups emerged due to the following reasons 1. Desire to socialize with others. The need for relationship with others is a basic human need. Man is a social being and he wants to associate with others. He does not like to work in isolated loneliness. This quest for social satisfaction prompts people to form informal groups. Informal groups provide social satisfaction and a sense of belonging to the members. It provides an opportunity for people behave in a natural and uninhibited manner free from rigidity and oppressiveness. It provides them a sense of identity and self –respect and helps in solving their personal problems and difficulties. 2. Job satisfaction Informal organization adds a human touch to the cold and in human qualities of the formal structures. It provides a means for developing friendships and fellow feelings. Informal fills the psychological vacuum or avoid created by dull boring and monotonous jobs. It allows people to satisfy their psychological needs. It creates a pleasant and satisfying work environment. People resort to informal interactions to release their tension and frustrations. Informal relationships provide them a sympathetic ear to their problems and provide an outlet to ventilate their grievances. In this way, informal organizations serve as a safety value to release daily tensions and frustration. Thus, informal organization exercises significant influence on job satisfaction and productivity. 3. Source of protection Informal organization offers a powerful protection against such threatening and oppressive forces. It provides a sense of security by protecting the individual against arbitrary treatment by management .It provides stability to work groups and psychological support to the members. Informal croups also protect their members from outside pressure and work pressure. 4. Support to formal structure. Informal organizations provide support to the informal structure. It blends with the formal organization to make a workable system for getting the work done. Formal structure tends to be inflexible and cannot meet every problem in a dynamic environment. Informal organization leads flexibility and dynamist to the formal structure. It also brings cohesive to formal organization. Informal organization can overcome the deficiency in the formal structure through suitable innovations. 5. Communication Device. Formal organization lays down the lines of communication which tend to be slow. Informal organizations provide the management with an addition channel of communication in the form of grapevine supplements official communication. It provides valuable feedback to managers on their style of functioning. 6. Overcoming managerial limitations. Authority may not always be effective and managers may have to relay on voluntary compliance of people out of people out o sheer good working of the organization several ticklish situations arise for which the prescribed procedures provided no guidance in such situations informal organization has its own ways of coping with problems 10 can fill in the mgt gaps by educating people how to really per formal the task. 7. Training and Development 1nformal organiston is a form for socialization of new managers and for helping them to learn the work practices and rules. Moreover, informal organization provides training ground for the development of informal leaders. 8. Coordination and control. An informal organization helps to develop team spirit and group pride. As a result need for close supervision is reduced. Members of the cohesive groups feel less nervous and express less anxiety Groups develop performance standards and group cohesiveness reduces turnover and absenteeism Informal leaders can help managers in solving problem like absenteeism late- coming e.t.c. A properly motivated informal group can achieve much better results than a formal group. According to Chester Barnard “informal organization brings cohesiveness to a formal organization, a feeling of belonging of status of self respect and of gregarious satisfaction”. HOW TO MANAGE INFORMAL GROUPS A manager must recognize that informal groups are a fact life and cannot be done away with.A manager can modify behavior of informal groups to make it more useful to the organization. Manager should adopt a flexible and accommodating approach towards informal organization rather than repressive approach. Repressive attitude of a manager hardens the attitude of informal group members leading to destructive conflicts. Therefore the best approach is to recognize the existence of informal organizations and to integrate it with the formal organization. Management should understand the goals, structure processes and norms of informal organization. A manager should find ways and means of taking advantage of the informal processes and behavior of the one hand to neutralized their adverse effects on the other. A manager should take the following measures to handle informal groups successfully 1 Let employees know that management accepts and understands informal organization. 2. Consider possible influence upon informal groups when taking any decision or action. 3. Integrate interests or goals of informal groups with those of the formal organisation. 4. Involve group in Decision Making process 5. Make use of group method of supervision. 6.Resolve inter- group conflicts by locating a common enemy, bringing sub- groups into interaction with each other and locating a super ordinate goal. 7. Keep formal activities from unnecessarily threatening informal organization in general 8. Maintain an objective atmosphere where correct information is easily available. Seminar question Clearly discuss the advantages and disadvantages of organization within the formal organization