Chartered

Qualification in
Human Resource
Management

Level : Diploma in Professional HRM

Unit Code : DPHRM - U2

Session : Principles of Management and Management Process

Name & Index No: …………………………………………

Chartered Institute of Personnel Management Sri Lanka (Inc)

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Unit Title Principles of Guided Learning Hours

Management and
Management Process
Level Diploma in Professional The guided learning hours for this unit would be
HRM 06 with an additional 40 hours of self-managed
Competency HRM and Administrative learning
Expertise
Unit Code DPHRM/U2
Scope of the Session
Session Topic Scope of the Topic
Unit Review 12th July 2021
Date 1. Introduction 1.1 Principles and
to practices of
Management Management and
and Management
Purpose and aim of the unit Management Process
This unit provides core knowledge of Principles Process 1.2 Evolution of
of Management and the Management Process to Management and
enable learners to understand how management Management
concepts and practices play an important role in thought
delivering organizational performance outcomes. 1.3 Functions of
The unit also explains the interaction between Management
management principles and processes with the 1.4 Management and
practice of Human Resource Management. Management
Process
Learning Outcomes
2. Functions of 2.1 Planning
On the completion of this unit students will; Management 2.2 Organizing
2.3 Directing
Understand the principles and practices of
2.4 Controlling
management
2.5 Link between
Understand the impact of management in
Management
driving organizational performance.
Process and HRM
Understand the process of planning,
organizing, directing, and controlling which
are the functions of management.
Understand the strategic relationship
between management and Human Resource
Management.

Assessment modes
Closed book Examination.

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Contents
01. Principles of Management & Management Process........................................................ 4
02.Functions of Management ............................................................................................. 12

Table 1: Managerial Roles .......................10

Figure 1:Components of an Organization

System .....................................................6
Figure 2: Management Process .................7
Figure 3: Example for Vision & Mission .....8
Figure 4: Level of Management .................8
Figure 5: Function of Management .........11
Figure 6: Function of Management .........13
Figure 7:Basic Elements of Organizing .....15
Figure 8: Function of HRM ......................19

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01. Principles of Management Information overload

Supply chain
& Management Process Strategic thinking & problem solving
Introduction
We live in a very challenging business Today’s business changes
environment today. Globalization, increased
competition and the advancement & the Globalization & global competition
changes in technology has taken business to More sophisticated, knowledgeable and
a new level. Today’s customer is exposed to informed customer
various products & different levels of service Better choice for customers increasing
& this has resulted in an increase in the their bargaining power
customer bargaining power. The companies More demanding customer
that will survive these challenges are the Consumer rights
companies that are innovative & are prepared Online solutions
to adapt to the ever changing & increasing Rapid technological changes
customer needs. Scares resources
Shrinking organizations

Pre COVID and Post COVID

Adapting to Change in a Rapidly
Business environment
The unexpected strike of the COVID 19 virus
Changing Business Environment
in March 2020 has made businesses re-think
Supervisors’ job responsibilities are
their business models and operations. Today’s
changing. Supervisors need to prepare
we talk of a new normal Post COVID that
themselves to adapt successfully to a rapidly
involves different working methods such
changing business environment.
flexible working & work from home and also
Becoming aware of your situation
much leaner and cost-efficient business
Understanding change
models which means employees have to take
Building your skills and knowledge
over multitasks and do much more work than
they did before with much lesser assistance. Change Management Competencies
and Skills
Today’s managers need to be knowledgeable
Ten Problems face by organizations
& skilled to handle the business challenges of
Uncertainty today and tomorrow, which means new skills
Globalization have to be developed hence regular
Innovation upskilling and re-skilling themselves become
Government policy and regulation and absolute necessity.
Technology Some of the skills that today’s managers need
Diversity to continuously develop are as follows:
Complexity

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Decision making Definition of Management

Conflict resolution
Communication “Management is now defined as a leadership
Comfort and ambiguity role that provides over all leadership to
Multiskilling achieve goals of an organization.
Management is the process of Setting &
achieving goals by effectively utilizing
What is Management?
Human, Financial, & Material resources”
One of the most important activities in a Management also could be defined as the
business is the management of the 4 M’s – shift from:
Men, Machines, Material & Money. So, “doing to getting things done through
management can be considered as proper others & with others”
utilization of the Human, Financial &
Material Resource.
Evolution of Management Thought
Management is an art of getting work done
through others & with others in order to Classical Approach
achieve organizational goals effectively in Behavioral Approach
a changing environment Quantitative Approach
Management is the integration & co- Modern Approaches
ordinations of resources in order to move Emerging Approaches
effectively & efficiently towards
organizational goals
Classical Approach
Classical management thought can be
Management is setting & achieving goals
divided into three separate schools. This
by effectively utilizing Human, Financial
approach viewed the organization from a
& Material resources.
production point of view.
Modern Day Management
1. Scientific Management
Modern day Management is considered more a
This approach emphasized on scientific study
leader ship role than merely an administrative
of work methods to improve the efficiency of
oriented management role
the workers. This method mainly
Modern day managers leadership from the
concentrated on improving efficiency
front & by example
through establishing standards, systematic
More emphasis on the Human Resource
observations & experiments - “One best way
Less Hierarchical Management structures
to do each job”

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2. Administrative Theory Behavioral Approach

Main focus of this approach was to coordinate This approach viewed the organization from
the internal activities of the organization. an individual & employee point of view. The
This method concentrated on division of behavioral approach to management
work, authority & responsibility, Discipline, concentrated on individual attitudes,
Unity of command (each employee should behaviors & group processes. This can be
receive orders from one superior) & remuneration considered the foundation of Human
etc. Recourse Management as this approach
considered the human factor & how
3. Bureaucratic Management
employees get motivated.
This management approach shows how to
Quantitative Approach
run organizations & emphasizes the need for
This approach focused on achieving
organizations to function on a rational basis.
organizational effectiveness through
The main characteristics of this approach are mathematical & statistical concepts. Quantitative
work specialization, strict rules & regulations, method included application of statistics,
impersonality of managers & hierarchical optimization models, information models &
structure. computer simulations.
Modern Approaches
1. Systems Theory
Management cannot function effectively
without considering the external
environmental factors. This approach viewed
the organization as a whole & a part of the
external environment. According to this
theory an organizational system has four
major components; Inputs, Transformation
Process, out – put & Feed back

Figure 1:Components of an Organization System

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Contingency Theory Management Process

According to this theory, there is no one best way to
The management process traditionally starts
manage all situations. In other words, there is no one
with an analysis of the internal and external
best way to manage. The manager’s task is to identify
business environments which includes a
the best technique for the particular situation.
SWOT analysis – a detail study of the
Emerging Approaches organization’s strengths, weaknesses and
also the opportunities & threats from the
1. Quality Management eternal environment that could directly or
This approach concentrates on continues indirectly affect the business. Analysis also
improvement of product & services to involves a MICRO environmental study of
achieve higher levels of customer competitors & customers and also a MACRO
satisfaction. environmental study using the PESTEL
2. Z – Theory model which is a study if political, economic,
This approach combines the positives of both socio cultural, technological and legal
the Japanese & American management style environments. Then goals are developed in
line with the Vision and Mission of the
organization

Figure 2: Management Process

Vision : Vision is a dream for the future with

the strength, courage & determination to
achieve it

Mission: The overall purpose of the

organization & what the organization wants to
accomplish

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Vision

Vision & Mission

Mission

Figure 3: Example for Vision & Mission

Management Levels

Figure 4: Level of Management

The above diagram

illustrates the different levels of management

within an organization and also the specific skill
set that is required at each different level.

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Top Management Low Level Management (Line

The Top Management is also called the policy Management)
level of management. Since it consists of the The low level management is also referred to as
Chief Executive Officer & his immediate the first line management or line managers. They
subordinates and also the directors of the are more involved in operations, such as work
company, most of the policy decision are schedules, organizing teams, assigning functions,
leading, motivating, supervising, reviewing
taken at this level it’s called the policy level
performance, deciding on training needs etc.
of management. The top management is
They are the people who gets the job done by the
responsible for the overall management of employees and is essential that they have good
the company. They establish the execution skills and people management skills
organization’s Objectives, goals & policies. and hands on experience.
They are also responsible for the corporate
strategies of the organization in order to
achieve the vision & corporate objectives of
the organization.

Middle Management
The middle management consists of
departmental and functional heads such as
the Head of HR, Head of Marketing, Head of
IT and Head of Operations etc. Middle
management is also called the strategic level
of management since its they who develop the
strategies to achieve the goals and objectives
set by the top management. Middle
management is also responsible for
implementation of those strategies &
organization’s policies in order to achieve the
objectives & goals set by the top
management. They are also responsible for
planning short term & more tactical strategies
to achieve short-term objectives that are
linked to the overall objectives of the
company.

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Mintzberg’s Ten Managerial Roles

Table 1:Managerial Roles

Interpersonal 01. Figurehead - Performs ceremonial roles

02. Leader - Directs & motivates subordinates
03. Liaison - information links both outside & inside

Informational 04. Monitor - Receives information, reports, performance

05. disseminator - Giving out information (reports, memo’s etc.)
06. Spokesman - Giving information outside the company

Decisional 07. Entrepreneur - Initiate improvement projects & new ideas etc.
08. Disturbance Handler - Take corrective action & resolve conflicts
09. Resource Allocator - Deeside who gets what resource
10. Negotiator - Represent department interests & handling unions

The Manager as a Leader Social Responsibilities of

Managers and leaders are not automatically Management
one and the same, but managers have the
Every organization in a business derives their
ability to become good leaders.
existence from the society. They draw various
Communicating well and celebrating team
resources from the external environment &
differences are among the ways to embrace
the society in order to convert them to product,
your natural leadership skills. Leaders have
services & profits which are outcomes of any
several positive traits, such as resilience,
business. Hence every organization has a
integrity and self-control. The
responsibility towards the society as a whole.
main difference between leaders and
managers is that leaders have people follow “Managers should pay attention to the welfare
them while managers have people who work of the workers, consumer needs & their
for them. A successful business owner needs safety, the interests & the rights of the
to be both a strong leader and manager to get creditors, government regulations & the
their team on board to follow them towards obligation of the organization towards
their vision of success. society as a whole”
Managers must be leaders because
their managers have tasked them with
achieving tasks and leadership is the best
way to motivate and inspire the team. i don't
agree that managers must be leaders

- www.business.com

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Introduction to Functions of
Management
Management is all about setting and
achieving goals and has four important
functions that should be carefully
management in order for the management
effort to be successful in any organization.

The four management functions are as

follows and will be discussed in more detail
in the next session

Figure 5: Function of Management

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02.Functions of Management management, and good social skills. All of

these competencies are important, and they
lead to great connections with people. They
Introduction lead to stronger and more effective
“Simple can be harder than complex: You managerial performance. EQ is a very
have to work hard to get your thinking clean important component for excelling as a
to make it simple.” By understanding and supervisor.
learning to apply these universal principles,
you are more likely to excel as a manager in Know the Business
any organization A common axiom in management is that a
The Functions of Management qualified manager can manage any business.
This point is only partially true. It is true that
Planning, Organizing, Staffing, Leading & most managers are generalists rather than
controlling specialists; however, many very successful
managers began their careers in specialist
The Types and Roles of Managers within roles.
the Organization
Management
Organizational structure is important in
driving the business forward and every Management is a process of planning,
organization has a structure. No matter the decision making, organizing, leading,
organizationally specific title, organizations motivation and controlling the human
contain front-line, middle, and top managers resources, financial, physical, and
information resources of an organization to
Effective Management of Organizational reach its goals efficiently and effectively.
Resources
Functions of Management
An essential component of operationalizing
the organization’s strategic plan is allocating Planning
Organizing
resources where they will make the most
Staffing
impact
Directing (Leading)
Understanding and Applying the Four Controlling
Dimensions of Emotional Intelligence
(EQ) in Maximizing Human Potential
Effective managers understand the context
and culture in leadership situations. What
helps these managers succeed? It is simple;
they understand EQ (the
competencies in each dimension of emotional
intelligence). Those four dimensions are: a
high self-awareness, social awareness, self-

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Figure 6: Function of Management

Planning Planning Horizons

Planning is the process 0f identifying & Planning horizon refers to the length of time,
setting goals, deciding on how to achieve of the plan. A company will have long range
them & in what time frame. plans, intermediate plans & short range plans.
What do we need to achieve? (Goal)
Where are we now? (SWOT – Situational Long Range Plan (5 Years or more)
Analysis) A long range plan is usually for 5 or more
How do we achieve it? (Strategy) years. A long range plan will tell you what the
What do we need to achieve? (Resources) organization wants to achieve in the long run
By when do we achieve it? (Time frame) & how to achieve it.

The planning process involves the Intermediate Plan (1 – 5 Years)

following activities: Intermediate plans are usually between 1 – 5
Vision, Mission & Objectives years. These plans are built based on your
A detailed business environmental long range plans & are interconnected &
analysis both internal & external explains what & how you are going to
Designing strategies achieve in the intermediate range in order to
Developing policies achieve your long range goals.
Developing procedures & rules
Detailed action plans & budgets

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Short Range Plans (01 year or less) and other functions in order for the
Short range plans are usually for 1 year or organization to achieve its overall goals.
less. These are tactical plans that need to be It should be noted that objectives set at the
achieved in the short run to help the corporate level & also the functional levels
organization to achieve their long range plan. need to be “SMART” objectives which
means Specific, Measurable, Achievable,
Planning Process Realistic and Time Bound.
Vision & Mission
Setting objectives Environmental Analysis
Environmental Analysis Next step in the planning process is to
Designing strategies conduct a detailed environmental analysis of
Developing policies the business environment both internal
Developing procedures and rules external.
Deciding & finalizing budgets Stated below are two of the most commonly
used tools for such analysis:
Vision & Mission
Vision is a dream that you want to achieve in PESTEL Analysis
the future. The vision is long term & not short PESTEL is an external environmental
term & will explain where your organization analysis. It involves a critical analysis of the
wants to be in the future. Mission is Political, Economic, Socio Cultural,
developed from the Vision. A Mission Technological, Ecological & Legal
statement is a detailed statement about “The environmental factors that affect your
purpose of the organization” and answers the business. Hence a study of these factors &
question “why are we in business” and how it affects your business is crucially
explains the value it adds to the stakeholders important if a business is to be successful.
of the organization.
SWOT Analysis
Re-visiting the Vision & the Mission is the SWOT analysis is more an internal analysis
first step in the management process since of your Strengths & Weaknesses and also an
objectives need to be developed in line with analysis of the external Opportunities &
the Vision & Mission of the organization. Threats that may have an impact on the
business. A SWOT analysis will tell you the
Setting Goals & Objectives
strengths that the organization currently
The next step in the planning process is to set
possess & also the weaknesses that should be
goals and objectives for the organization. This
overcome & also opportunities that can be
includes development of long term, medium
used & also the future threats that you need
term and short term objectives and also
to guard against, plan & be prepared for.
breaking down these objectives function wise
While above Two tools are the most
for Example: What should be the objectives
commonly used, there are some other very
of Sales, Marketing, HR, Finance
useful tools such as the Porter Five force
model, McKinsey 7S framework & the

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stakeholder analysis and many other tools an

organization could choose from to further Budgets
strengthen their business environmental The final step is to do the budget. The budget
analysis will be the total estimated expenses to
Designing Strategies implement your plan. Developing budgets is
A strategy will explain how you are going to a crucial function of the planning process
achieve your objectives. In other words it’s since adequate resourcing is needed to
the methodology adapted to achieve your accomplish goals while striking cost
goals. Strategies are more long term efficiencies is also very important in a
compared to what are referred to as tactics. competitive environment such as today.
Hence this also involve some intelligent
Developing Polices decisions being made on some trade-offs that
Policies are developed from your strategies. may seem appropriate.
Polices will be a broad set of guidelines that
the organization needs to follow. Organizing
Organizing refers to the function of sourcing,
Procedures & Rules allocating & arranging of resources, activity
Procedures are developed from the polices in & authority in order to achieve
order to implement the policy. This will be a organizational objectives.
set of very clear procedures, practices & rules
that the employees need to follow

Figure 7:Basic Elements of Organizing

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Resources Organizational Chart

Resources need to be sourced & allocated in An organizational chart is a diagram that
a cost effective & an efficient manner in order represents the positions & the relationships
to be competitive, as it has a major impact on within an organization. It shows how the
the price of the final produce company is structured. Basically it is a chart
that shows the organizational structure of the
Activity company.
Activity needs to be allocated in a manner Common Organizational Structures
that will give the best productivity. This will
basically answer the question “who will do
Functional Structures
what” An organization needs to be structured
This is the most common of
in a way that will help achieve organizational
departmentalization and it is based on
goals
specialized function such as production,
marketing, engineering, finance and
Authority
personnel.
Proper allocation of authority and
empowerment is a mandatory requirement to Product Based Structures
achieve a high level of efficiency and achieve Here the main focus is on the products. Work
pre-set organizational goals. The final goal of is formed according to the where product
the organizing function is for the expansion & degeneration and
organization have a highly effective and manufacturing and marketing characteristics
efficient organizational structure that will of the products are primary concern. When
help achieve organizational goals, quickly you have products that are very different to
respond to the changes that occurs in the each other each product category needs to be
business environment and also innovate and handled differently.
grow Example: Director consumer goods,
Organizational Design Director industrial goods, Director Sports
The final result of the organizing function is goods & there will be divisions created under
the organizational structure. The each of these Directors who handles a
organizational structure will show you how particular range of products
Activity, Authority & Resources are divided.
Customer based structures
An organizational structure can also be This type of departmentalization is used by
defined a fixed pattern of: those organizations which deal differently
Positions within the company with different types of customer. The
Relationships among those positions customers are key, to the way the activities
are grouped.
Example: Whole sale division & Retail
division

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Geographical Structures Chain of Command

This type of structure is especially useful for
large scale enterprise which is geographically The chain of command answers the question:
spread out such as banking, insurance or chain “To whom do individuals & groups report
stores. This type of structure helps the to & what is the chain or reporting”
organization to be more sensitive to the
customer needs in these specific geographical Span of control
areas. Span of control says how many people one
Example: Regional Head America, Regional individual manager can effectively manage.
Head Asia, Regional Head Middle East It is generally accepted that the ideal number
of people under one manager should be
somewhere between 10 to 15. If it is much
Matrix Structures
more than this acceptable level it is called
The idea behind the matrix structure is quite
“Broad Span of Control” here the
simple. The major project is assigned to a
disadvantage is that there is less attention per
project General Manager and he is given a
individual employee.
team of needed specialists from different
disciplines & is asked to complete the If there are only a very few employees under
project. The team may consist of functional one manage it is called “Narrow Span of
representatives from various areas such as Control” here the disadvantage is the waste
research and development, production of management time.
design, electronic data processing etc. Matrix
structure in a sense, there is a combination Unity of command
and interaction of functional managers & The unity of command theory says that one
product managers. employee should receive orders only from
one superior.
Project Structures
These are temporary organizational
structures formed for specific projects for a
Staffing
specific period of time and are dismantled, The staffing function of management pertains
once the goal and objective are achieved to recruitment, selection, training,
Example: The goal may be to construct a development, appraisal and remuneration of
bridge. personnel. It is the duty of every manager to
For this project, the specialists from different perform this function. The responsibility for
functional departments will be drawn to work the efficient planning and execution of
together, these functional departments are staffing function rests upon every manager at
production, engineering, quality control, etc. all levels. Sourcing employees to fill the jobs
when the project is completed, and these created by the organizing process.
specialists go back to their respective duties.

- www.economicsdiscussion.net -

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Matching job demands with the Today’s teams are different from the teams of
applicant’s ability (Right people at the the past: They’re far more diverse, dispersed,
right place) digital, and dynamic (with frequent changes in
Orientation of the new employees to the membership). But while teams face new
new organizational environment hurdles, their success still hinges on a core set
Training on job functions & required of fundamentals for group collaboration.
knowledge & skills.
Retaining qualified & experience staff.
- Harvard Business Review -
Job rotation, Jobs enlargement, Job
enrichment Controlling
Performance appraisals, rewards &
recognition. Controlling can be defined as that function of
Compensation, benefits & other staff management which helps to seek planned
welfare. results from the subordinates, managers and
at all levels of an organization.
Directing (Leading) The controlling function helps in measuring
the progress towards the organizational goals
DIRECTING is said to be a process in which & brings any deviations, & indicates
the managers instruct, guide and oversee the corrective action.
performance of the workers to achieve
predetermined goals. Directing is said to be
- www.toppr.com -
the heart of management process. Planning,
organizing, staffing have got no importance Establishing standards for performance
if direction function does not take place. (Ex. Targets, Lead times etc.)
Monitoring & measuring actual
- www.managementstudyguide.com -
achievements
Comparing actual achievements with
Directing & Leading the members of the established standards
organization to move in the direction that will Corrective action.
achieve the objectives of the organization.
This involves providing over all leadership & Importance of control
directions towards clear goals of the Increasing size of business
organization though effective Motivation for efficient employees
communication, clear work procedures, For complete discipline
responsibility, delegation & empowerment. Helpful in future planning
Directing (Leading) will ensure that all the Aids efficiency
members of the organization are aware of all Decrease in risk
the goals & objectives of the company & are Helpful in coordination
moving in the direction that will achieve the Helpful in decentralization
objectives

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The link between Management Definition of Human Resource

Process and HRM Management
Overall, the relationship between HRM can be defined as the effective
HR and management is becoming management of people in an organization.
mutual. HR executives are trying to become HR management helps bridge the gap
a part at the management table and they are between employees' performance and the
concerned in everyday management organization’s strategic objectives. Moreover,
activities. However, there is still a long an efficient HR management team
way to go if HR is to become a strategic can give firms an edge over their
partner at all levels. competition.

- www.ukessays.com - - www.gisma.com -
Human Resource Management is
the process of recruiting, selecting, inducting
employees, providing orientation, imparting
training and development, appraising the
performance of employees, deciding
compensation and providing benefits,
motivating employees, maintaining proper
relations with employees and their trade.

Figure 8: Function of HRM

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