After reading this article you will learn about:- 1. Concept of Management 2. Functions of Management 3. Nature 4. Importance.

Concept of Management:

Every business requires planning for the future to find a way to successful business for which the person in the helm of affairs has to take decisions and is responsible for the consequences for his decision making whether favourable or unfavorable.

In short this is the crux of the science of management. According to Bradford and Johnson, “Management is an intangible part of production which develops within the lives of men. It is first a mental process, a concentration of desires, a will power. Management functions when a farmer (manager of the farm or business) is, (1) Observing and conceiving ideas, (2) Analysing with further observations, (3) Making decisions on the basis of analysis, (4) Taking action, and (5) Accepting responsibilities.”

The management is viewed as:


1. An economic resource. cr

2. A system of authority.

3. A class or elite.

In economic terms management is one of the factors of production together with land, labour and capital.


According to specialists in administration and organization, management is a system of authority.

In view of sociologists, management is a class and status system. A manager should be a person elite of brains and education.

According to Newman and Summer, management is considered to be a process consisting of organizing, planning, leading and controlling.

Organization deals with assigning various tasks to different people and coordinat­ing their efforts as well maintaining a careful balance between different parts of the enterprise. Planning is concerned with setting goals, objectives and targets and delineating mechanisms for attaining them at various levels throughout the organization as well as for the total organization.


Leading is concerned with the manner in which the manager integrates the needs of the employee with those of the departments or total organization. Leading necessitates clear direction, coupled with a spirit of cooperation. Leadership is also concerned with the maintenance of high standards, discipline and occasionally the judicious mix of authority, power and influence in order to attain target objectives.

Controlling is concerned with measuring and narrowing the gap between planned performance and actual performance, and with the monitoring of perfor­mances, as well as, taking corrective actions wherever necessary. Management is thus a complex, integrated and ongoing dynamic process.

Functions of Management:

The basic functions of management are:

(i) Decision making:


The process by which, a course of action is consciously chosen from the available alternatives for the purpose of achieving the desired results.

(ii) Organizing:

The process by which, the structure and allocation of jobs are determined.

(iii) Staffing:


The process by which managers select, train and promote as well as retire subordinates.

(iv) Planning:

The process by which a manager anticipates the future and discovers alternative courses of actions open to him.

(v) Controlling:


The process that measures current performances and guide it towards some pre-determined goals.

(vi) Communication:

The process by which ideas are transmitted to others for the purpose of affecting the desired results.

(vii) Direction:


The process by which actual performances of subordinates is guided towards common goals.

Characteristics of Good Manager:

Since management is the most important task it cannot be entrusted to novices devoid of certain qualities which makes the difference between good and bad management performance.

These qualities are:

1. Knowledge.

2. Decision-making power.


3. Self-reliance.

4. Self-assertion.

5. Regard for others and social sensitivity.

6. Emotional stability.

Nature of Management:

It is purely scientific and having tools and techniques which are scientific. It is also taken as profession which is based on proven, systematic body of knowledge and thus requires intellectual training. It should maintain an experimental attitude towards information thus requires a search for new ideas. It involves service not only profit as a motive.

Importance of Management:

In order to give sophisticated life to people and a wide choice of consumption goods it will improve the standard of living. Management carries ethical and moral behaviour.


Now let us discuss the functions of management in details:

1. Decision Making and Policy Formulation.

Managers are directly concerned with decision-making that will influence the action of others.

Since decision is the course of action consciously chosen from available alternatives for the purpose of achieving a desired result hence, decision involves:

(a) Choice from amongst available alternat  ives,

(b) Mental process at conscious level, and


(c) Purpose behind the decision and therefore attain objectives laid.

The criterion of a good decision are:

(i) Depends on decision-makers being consciously aware of factors that set the stage for decisions.

(ii) It depends upon the recognition of the right problem. A right question should be looked for and problems which are solved by putting the right question. Right problem is defined within the limiting factors. Search for correct questions which depends on ethical problems of determining the ends. So differentiate between end and means.

(iii) Search for and analysis of available alternatives and their probable consequences in the step most subject to logical and systematic treatment. The approach of logic is the key to this step. The study of logic involves the way in which the human mind poses from premises to propositions based on the premises.

A premise is the statement of the relationship between a cause and consequences. The process of decision making involves the consideration of a number of these. The premise is the fundamental unit of consideration in decision-making.


First, it is desirable to recognize the premises upon which an approach is based.

Secondly, we need to test the validity of our premises. We must anticipate whether the consequences will actually follows from the course.

Thirdly, we should distinguish between value premise and factual premises. The validity is a measurement concept and the validity lies in clarity on value judgment in which decision lies.

(iv) Selection of the solution—we rank the preferences.

(v) A decision be accepted by the organization.

These steps depend on the organization of the business.


Policy Formulation:

A policy is a guide for making decisions. If a decision provides help for decisions in other situations it is said to be a policy decision, because it sets a precedent and provides some guidelines for decision-making in future.

A good policy should have characteristics as:

1. Related to objectives of the firm.

2. Stated in an understandable words.

3. It must provide yardsticks for future actions.

4. It must be subject to change but relatively stable.

5. It must be reasonable and capable of being accomplished.

The limitations to policy are:

(a) It may become a crunch for the subordinate and put the ball in top bosses count as policy is of his.

(b) Under the conditions of change it becomes absolute.

(c) Subordinates take advantage of the policy if not stated in broad and definite terms.


“Organisation is a pattern of ways in which a large number of people of a size too great to have intimate face to face contact and engaged in a complexity of task, relate themselves to each other in a conscious, systematic establishment and accomplishment of mutually agreed purposes.”

Assumption on which the above definition is based:

1. Large organizations do not permit face to face leadership.

2. Organizations are complex.

3. Organizations are attempt at conscious rationality.

4. Organization must have a purpose.

5. Organizations are universal.

Organization is one of the basic process a manager must use to unite the work of different people in order to achieve company’s goal.


Planning is crucial to managerial activity. Planning is best with problems and difficulties such as the determination of overall objectives, the formulation of product-market strategies, and the evaluation of the joint efforts of combined programmes. Better steps towards solving of top management planning problem is to discover a better way of exploring the anatomy of the planning process and determining just what goes on.


Control is the process that measures current performances and guides it towards some predetermined goals. The essence of control lies in checking existing actions against some desired results determined in the planning process.

The essential elements of any control system are:

1. A predetermined goal, plan, policy, standard, norm, decision rule, criterion or yardstick.

2. A means of measuring current activity, quantitatively if possible, viz. Production Function Analysis.

3. A means of comparing current activity with a criteria.

4. Some means of correcting the current activity as to achieve the desired results.

The above elements point out to the fact: The questions answered are: What should be the result? A useful control system does not evaluate the goodness of the goal; it merely provides a means by which an activity could be directed towards an actual goal. A predetermined criterion should be stated explicitly hence quantitative statement are preferred.

The degree of accuracy to which measurement is carried will depend upon the needs of the specific application. The accuracy of measurement be maintained. Comparison of performances with criteria set up will show variation and variation be quantified. The criteria and performance be expressed in graphical language.

The relationship in the central system such as ratio, trend, mathematical equations, and charts help and add meaning to the measurement of actual performance. This comparison helps in prediction of future problems. Thus, quick information be given.

The central system should make correction if performance does not fall within the desired criterion, if not, no action is needed. The manager should avoid taking action when it is not needed and failing to take action when correction is needed.

Principles of Control:

1. Strategic Point control:

This is done by identifying critical, key or limiting points and close attention is given to adjust them. But choose imitating points and close attention is given to adjust them. But choose important and unimportant factors.

2. Feedback:

Feedback is the adjustment of future action on the basis of post performances.

3. Flexible Control:

It should be responsive to the current situation.

4. Organizational Suitability:

Control should be tailored to fit in the organization.

5. Staff Control:

Unit may be planned to control themselves as a sub-system of control.

6. Direct Control:

Any control system should be designed to maintain direct contact between the controller and the controlled.

7. Human Factor:

The system of control should be such as not to disturb the psychological feelings of the human beings connected with the organization.


The communication of thoughts and ideas is important aspects of management. The media could be extensively used either-orally, mathematically or illustratively.

Types of Communication Problems:

1. The Turbulent Problem:

How accurately the symbols are understood.

2. The Summatic Problem:

The symbol conveys the desired meaning.

3. The Effectiveness Problem:

Meaning effects the desired results.

The flows of communications are of three types:

(a) Vertical,

(b) Horizontal, and

(c) Informal.

The vertical is the flow of information from superior boss downwards (supervisor or other subordinates). Authority lines are important channels of communication but they compose only one type of channel.

The horizontal channel provides means by which managers of the same level of organization coordinated their activities without referring the matter to superior.

The formal communication are planned to meet the specific needs of the organization but many communications are formal.

There are certain communication barriers: Distortion—due to noise pollution.

Leading or Leadership:

Leading is a matter of dynamic man to man relationship between a manager and his subordinates. It is the process by which a manager directly and personally influences the behaviour of those who work with him, and by which his subordinates in turn feed information—ranging for highly subjective, personal responses to data on operating conditions—that is vital to the manager in his subsequent actions:

The role of leadership:

1. To guide and motivate the behaviour to fit the plans and jobs that have been established.

2. To understand the feelings of his subordinates and the problem they face as they translate plans into complete actions.

These two actions are vital, if effective cooperative action is to take place.

In order to guide and motivate the action of the subordinates:

Plan has to be communicated to them meaningfully with reasons behind it. Help managers to understand the operating problems and feelings of the subordinates through personal communication, hence decision-making becomes easier. Personal communication has a positive effect on the feelings of the subordinates which should be a two way communication.

Basic leadership attitude should be cultivated in the manager:

(a) Empathy,

(b) Self-awareness, and

(c) Objectivity.

Empathy helps looking at problems from some other person’s point of view, self- awareness is knowing oneself how to appear to others, objectivity does not permit encroachment of emotions while dealing with problems.

Leadership functions are:

(i) To guide and motivate,

(ii) To understand.

Major leadership activities are:

1. Developing voluntary cooperation,

2. Directing and disciplining,

3. Two way communication.

Prerequisite for leadership are:

(a) Clear organization,

(b) Job related needs,

(c) Men matched to jobs,

(d) Communication network,

(e) Sound objectives,

(f) Policies and programmes,

(g) Control system.

Leaderships are viewed from three points of view:

(i) Democratic,

(ii) Autocratic,

(iii) Charismatic.