Principles of Management

Principles of management are broad and general guidelines for managerial decision making and behavior (i.e. they guide the practice of management).

Negative impacts of globalisation and liberalisation.

It does not allows our small scale producers to make profit.
Liberalisation leads to more export of goods produced by exploiting our resources.
It leads to the competition between MNCs and small scale producers.
MNCs occupies our India and companies and does not allow Indian to grow.
MNCs doesn't have any tax for particular years but Indian need to pay tax.

Positive effect

Scalar Chain- Effective communication of information

Cordial relations among employees

Equity- Satisfied employees

Motivated employees

Division of Work- Specialisation

Minimisation of wastage

Scientific management is a system of management that examines and integrates workflows. Its principal goal is enhancing economic performance, especially labour potency. It was one of the initial efforts to implement science to the design of methods and to management.

Management is an art of getting things done with and through others. Management can be defined as, the process of getting things done with the aim of achieving organizational goals effectively and efficiently.

Measurement of Actual Performance:

Once the standards have been determined, the next step is to measure the actual performance. The various techniques for measuring are sample checking, performance reports, personal observation etc. However, in order to facilitate easy comparison, the performance should be measured on the same basis as the standards.

Taking corrective action-

The final step in the control process is determining the need for corrective action. Managers can choose among three courses of action:

A)They can do nothing

B)They can correct the actual performance, or

C)They can revise the standard

Maintaining the status quo if preferable when performance essentially matches the standards. When standards are not met, managers must carefully assess the reasons why and take corrective action. Moreover, the need to check standards periodically to ensure that the standards and the associated performance

(A) It Helps in Identifying Opportunities and Making First Mover Advantage

• The environment provides numerous opportunities and it is necessary to identify the opportunities to improve the performance of a business.
• Early identification gives an opportunity to an enterprise be the first to identify opportunity instead of losing them to competitors.
• Example: ‘Airtel’ identified the need for fast internet and took first-mover advantage by providing 4G speed to its users followed by Vodafone and Idea.
• Asian paints lost market share to Nerolac because of its failure to match its technology.

(B) It Helps the Firm Identify Threats and Early Warning Signals

• The business environment helps in understanding the threats which are likely to happen in the future.
• Environmental awareness can help managers identify various threats on time and serve as an early warning signal.
• Example: Patanjali products have become a warning signal to the rest of the FMCG
• The sector to develop similar products. Similarly, if an Indian firm finds that a
• Foreign multinational is entering the Indian market with new substitutes, it needs to prepare accordingly.
• Chinese mobile phones have become a threat for Indian mobile phone manufacturers.

(C) It Helps in Tapping Useful Resources

• Business and industry avail the resources (inputs) from the environment
• and convert them into usable products (outputs) and provide to society.
• The environment provides various inputs (resources) the like finance, machines, raw materials, power and water, labour, etc.
• The business enterprise provides outputs such as goods and services to the
• Customers, payment of taxes to the government, to investors and so on.

Example: With the demand for the latest technology, manufacturers will tap the resources from the environment to manufacture LED TVs and Smart TVs rather than collecting resources for colour or Black & White TVs.

Management is defined as the procedure of organising, directing, planning and controlling the efforts of organisational members and of managing organisational sources to accomplish particular goals.

• Planning is the purpose of ascertaining in advance what is supposed to be done and who has to do it. This signifies establishing goals in advance and promoting a way of delivering them effectively and efficiently. In an establishment, the aim is the obtainment and sale of conventional Indian handloom and workmanship articles. They trade furnishings, readymades, household items and fabrics made out of classical Indian textiles.
• Organising is the administrative operation of specifying grouping tasks, duties, authorising power and designating resources needed to carry out a particular system. Once a definite plan has been set for the completion of an organisational intent, the organising party reviews the actions and resources expected to execute the program. It ascertains what actions and resources are needed. It determines who will do a distinct job, where and when it will be done.
• Staffing is obtaining the best resources for the right job. A significant perspective of management is to make certain that the appropriate people with the apt skills are obtainable in the proper places and times to achieve the goals of the company. This is also called the human resource operations and it includes activities such as selection, placement, recruitment and coaching of employees.

Limitations of Informal Organisation: Following are the limitations of Informed Organisation:
(i) It creates Rumours: All the persons in an informal organisation talk carelessly and sometimes a wrong thing is conveyed to the other person which may bring in horrible results.
(ii) It resists Change: This organisation resists change and lays stress on adopting the old techniques.
(iii) Pressure of Group Norms: In this organisation, people are under pressure to observe group norms. Sometimes the people assembled in informal group lose sight of their objective and all decide to oppose their superiors unanimously. Such a situation adversely affects productivity.

1. Legal environment: The court passed an order to ban polythene bags.
2. Social environment: The bags are creating many environmental problems which affect the life of people in general. Social in general is more concerned about quality of life.
3. Political environment: The government decided to give subsidy to jute industry to promote this business.
4. Technological environment: Innovative techniques are being developed to manufacture jute bags at low rates.
5. Economic environment: Incomes are rising and people can afford to buy these bags.

Business environment refers to forces and institutions outside the firm with which its members must deal to achieve the organisational purposes. Here

• Forces = economical, social, political, technological etc

• Institutions = suppliers, customers, competitors etc

It includes all those constraints and forces external to a business within which it operates. therefore,

• The firm must be aware of these external forces and institutions and

The firm must be nagged keeping in mind these forces and institutions so that the organisational objectives are achieved. .

Fayol's principles are listed below:

1. Division of Work – When employees are specialized, output can increase because they become increasingly skilled and efficient.
2. Authority – Managers must have the authority to give orders, but they must also keep in mind that with authority comes responsibility.
3. Discipline – Discipline must be upheld in organizations, but methods for doing so can vary.
4. Unity of Command – Employees should have only one direct supervisor.
5. Unity of Direction – Teams with the same objective should be working under the direction of one manager, using one plan. This will ensure that action is properly coordinated.
6. Subordination of Individual Interests to the General Interest – The interests of one employee should not be allowed to become more important than those of the group. This includes managers.
7. Remuneration – Employee satisfaction depends on fair remuneration for everyone. This includes financial and non-financial compensation.
8. Centralization – This principle refers to how close employees are to the decision-making process. It is important to aim for an appropriate balance.
9. Scalar Chain – Employees should be aware of where they stand in the organization's hierarchy, or chain of command.
10. Order – The workplace facilities must be clean, tidy and safe for employees. Everything should have its place.
11. Equity – Managers should be fair to staff at all times, both maintaining discipline as necessary and acting with kindness where appropriate.
12. Stability of Tenure of Personnel – Managers should strive to minimize employee turnover. Personnel planning should be a priority.
13. Initiative – Employees should be given the necessary level of freedom to create and carry out plans.
14. Esprit de Corps – Organizations should strive to promote team spirit and unity.