Chapter I
Chapter I
Chapter I
LEARNING OBJECTIVES
1. Describe the four management functions and the type of management activity associated
with each.
2. Explain the difference between efficiency and effectiveness and their importance for
organizational performance.
3. Describe management types and the horizontal and vertical differences between them.
4. Describe conceptual, human and technical skills and their relevance for managers and
non-managers.
5. Define the ten roles that managers perform in organization.
I. ORGANIZATION
WHAT IS ORGANIZATION?
CHARACTERISTICS OF ORGANIZATION
TYPES OF MANAGERS
A. VERTICAL DIFFERENCES
I. TOP MANAGERS
• Top of the hierarchy and are responsible for the entire organization
• Titles: President, Chairperson, Executive Director, Chief Executive Officer (CEO), etc.
• Responsible for setting goals, defining strategies for achieving them, monitoring and
interpreting the external environment and making decisions that affect the entire
organization.
• They communicate vision for the organization, shape corporate culture and nurture
entrepreneurial spirit that help the company keep pace with rapid change.
• Creating a context for change
B. HORIZONTAL DIFFERENCES
I. FUNCTIONAL MANAGERS
- Responsible for departments that perform a single functional task and have employees
with similar training and skills
- Includes Advertising, Sales, Finance, Human Resources, Manufacturing and Accounting
- Line Managers are responsible for manufacturing and marketing departments that make
or sell the product or service
- Staff Managers are in charge of departments such as Finance and Human Resources that
support Line Departments
MANAGEMENT
- The attainment of organizational goals in an effective and efficient manner through
planning, organizing, leading and controlling organizational resources.
2 IMPORTANT FACTORS
Getting Efficiency
work
done
through Effectiveness
others
EFFICIENCY AND EFFECTIVENESS
EFFECTIVENESS
- The degree to which the organization achieves a stated goal. It means that it succeeds in
accomplishing what it tries to do and providing a product or service that customers value.
- Goal attainment
- Doing the right things
EFFICIENCY
- The use of minimal resources to produce a desired volume of output.
- It can be calculated as the amount of resources used to produce a product or service.
- The relationship between inputs and outputs, the goal is to minimize resource cost
- Doings things right—most output for least input
PERFORMANCE
- The organization’s ability to attain its goals by using resources in an efficient and
effective manner. The ultimate responsibility of managers is to achieve high
performance
PLANNING
- The management function concerned with defining goals for future organizational
performance and deciding on the tasks and resources needed to attain them.
- Defining goals, establishing strategy and developing sub plans to coordinate activities
ORGANIZING
- The management function concerned with assigning tasks, grouping tasks into
departments, and allocating resources to departments.
- Determining what needs to be done, how will it be done, and who is to do it.
LEADING
- The management function that involves the use of influence to motivate employees to
achieve the organization’s goals.
- Directing and motivating all involved partners and resolving conflicts
CONTROLLING
- The management function concerned with monitoring employees’ activities, keeping the
organization on track toward its goals and making corrections as needed.
- Monitoring activities to ensure that they are accomplished as planned.
Note: Some management theorist identify additional management functions such as staffing,
communicating, or decision making. These additional functions will be discussed as subsets of
the four primary functions.
LEVELS OF MANAGEMENT
All managers perform the same basic functions, but their responsibilities differ according to their
management level.
TOP MANAGEMENT
- Those who make the planning decisions that affect the whole company. Their decisions
have the broadest effect on the company.
MIDDLE MANAGEMENT
- It’s the job of the middle management to implement the decisions of top management.
They plan ways that departments under them can work to reach top management’s goal.
They communicate with and support supervisory level managers.
SUPERVISORY LEVEL
- These frontline managers supervise the activities of employees who carry out the tasks
determined by the plans of middle and top management. They assign duties and evaluate
the work of production or service employees.
I. INTERPERSONAL ROLES
• Managing through people
• Pertain to relationships with others and are related to the human skills
Skills Approach
Technical skills
• Knowledge and proficiency in a specific field
• Includes mastery of the methods, techniques, and equipment involved in
specific functions such as engineering, manufacturing, or finance.
• It includes specialized knowledge, analytical ability, and the competent
use of tools and techniques to solve problems in that specific discipline.
• This is particularly important at lower organizational levels.
Human skills
• The ability to work well with other people and to work effectively as a
group member
• This is demonstrated in the way a manager relates to other people,
including the ability to motivate, facilitate, coordinate, lead, communicate
and resolve conflict.
• A manager with human skills allows subordinates to express themselves
without fear of ridicule and encourage participation.
• A manager with human skills likes other people and is liked by them.
• Human skills are becoming increasingly important for managers at all
levels, and particularly for those who work with employees directly on a
daily basis.
Conceptual skills
• The ability to think and conceptualize about abstract and complex
situations concerning the organization
• It involves the manager’s thinking, information processing and planning
abilities.
• It involves knowing where one’s department fits into total organization
and how the organization fits into the industry, the community, and the
broader business and social environment.
• It is needed by all managers but are especially important for the top
managers.
Figure 1
Conceptual Skills Human Skills Technical Skills
Top Manager
Middle Manager
First-Line Manager
Management Levels in the Organizational Hierarchy
CEO
Vice Presidents
Functional Heads
First Line Management First Line Managers
(Production, Sales, acctng., HRM)
Non-managerial employees
Line jobs, staff jobs
Set standards to
achieve goals
standards