Scope of Management: Economic Resource, System of Authority and Class or Elite!

The concept of management broadened in scope with the coming of new perspective by various areas of study.

The study of management has evolved into more than the use of means to achieve given ends. Now-a-day, it comprises moral and ethical values concerning the selection of the right ends towards which managers should strive.


Harbison and Myers give three fold concepts for emphasising a broader scope for the management.

They observe management as:

1. An economic resource

2. A system of authority : and


3. A class or elite

1. Economic Resource:

As viewed by the economists, management is one of the factors of production together with land, labour and capital. With the growth in industrialization of a nation the need for management becomes greater with more and more industrialization of a nation.

The managerial resources of an enterprise determine its productivity and profitability. Management should be used more vigoursely in the industries experiencing innovations. Executive development is essential for those enterprises in which development is fast (rapid).

2. System of Authority:

Experts in administration and organization think that management is a system of authority. Historically, management developed:


(a) An authoritarian philosophy with a small number of high officials determining all actions of the employees.

(b) Later, humanitarian considerations of some managers led to the development of paternalistic approach.

(c) Still later, constitutional management emerged/characterized by a concern for definite and consistent policies and procedures for dealing with rank and file.

(d) As more employees received higher education, the trend of management was towards a democratic and participative approach.


Thus modern management can be considered synthesis of these four approaches to authority.

3. Class or Elite:

A sociologist view management as a class and status system. The rising complexity of relationships in modern society demands that managers become elite of brain and education.

Entrance into this class is based more and more on education and Knowledge rather than on family or political connections. Some students view this development as a “managerial revolution” in which the managerial class obtains increasing amount of power and threatens to become an autonomous class.

Some people view this development with alarm while others point out that as the power of manager’s increases; their number expands so that there is little need to worry this tendency towards a managerial autocracy. A board view of management requires that the students should consider this larger perspective of the place of management in society.


These three perspectives are not the only important ones for the manager to recognize. An industrial manager can argue that the technology is of utmost importance. A psychologist would emphasize the needs of the human-being and his adjustment to organizational pressures. The theologian would concentrate on the spiritual implications of managerial actions.

Many chief executives and educationists consider that the most essential perspective of top managers should be based on a “liberally educated outlook on life.” The total concept of management requires an understanding of the meaning of liberal education and its relationship to managerial functions.

A liberal point of view is not merely the sum of a finite number of narrow approaches. Its stress is on freedom to select from the large range of possibilities by discovering new possibilities and by recalling possibilities earlier developed but forgotten.

The liberally oriented manager continues to expand his vision with utmost freedom in an effort to strive towards our ultimate aim in life. Management is concerned both with ends as well as means, it is clear that it must maintain a broad perspective, unfettered by specialized restrictions.