Thursday, January 28, 2010

Management By Objectives: MBO

Motivating people by aligning their objectives with the goals of the organization.

For many people working in modern business environments, it's hard to remember a time when non-managerial employees weren't involved with, and interested in, corporate strategy and goals. We are regularly reminded about the corporate mission statement, we have strategy meetings where the "big picture" is revealed to us, and we are invited to participate in some decisions. And we're aware of how our day-to-day activities contribute to these corporate goals.

This type of managing hasn't been around forever: It's an approach called Management by Objectives; a system that seeks to align employees' goals with the goals of the organization. This ensures that everyone is clear about what they should be doing, and how that is beneficial to the whole organization. It's quite easy to see why this type of managing makes sense - when the parts work in unison the whole works smoothly too. And by focusing on what you're trying to achieve, you can quickly discriminate between tasks that must be completed, and those that are just a waste of valuable time.

Management by Objectives was introduced by Peter Drucker in the 1950s and written about in his 1954 book, The Practice of Management. It gained a great deal of attention and was widely adopted until the 1990s when it seemed to fade into obscurity.

Partly, the idea may have become a victim of its own success: It became so much a part of the way business is conducted that it no longer may have seemed remarkable, or even worthy of comment. And partly it evolved into the idea of the Balanced Scorecard, which provided a more sophisticated framework for doing essentially the same thing.

Peter Drucker used this term in 1954 and applied to planning.
In this approach the Boss and Subordinates function as a team in setting objectives and accomplishing those objectives through cooperation.
It has four steps:

Setting goals: supervisors and subordinates collectively set the goals for the organization.

Developing action plan: Action plans are made for both individual and departments. Who is responsible for what action?

Reviewing progress: Is a periodic review to ensure that action plans are working.

Appraising overall performance: weather goals are achieved or not. If goals are achieved, then giving rewards to employees for their good performance.
Evaluation of the whole process is done at the year end.

Types of Plans

Frequency of use: how frequently a plan is being used, one time or most of the time?
Single use plan: A plan which is used for a single purpose e.g. project.
Standing plan: A plan which is made for the activities performed on repeated basis e.g. discipline, hiring, dismissal, salaries, illness etc
Time frame:
Long term plan: Plan for the period of more than 3 years.
Intermediate plan: Plan for the period of 3 years.
Short term plan: Plan for the period of one year or less than a year.
To capture the whole market or to become a market leader (long term plan)
Opening of different offices in different locations (intermediate plan)
Hiring new employees and giving training to existing employees (short term plan)
Breadth (size) wise:
Strategic plans: long term plans involving a direction e.g. to become a market leader but how? By providing good quality product, good marketing etc.
Operational plans: plans which are made to carry out operational activities like activities in process, short term in nature.

Terms Which are Related to Planning

- Vision
- Mission
- Goals and Objectives
- Policies
- Program
- Rules
- Procedure
- Strategy

Vision is mental picture of an organization.
What do we want to become in the future?
Vision talks about future time.

Vision statement example (MRRD):
A healthy, poverty free and opium free afghansitan, base on independence, democratic governance, self reliability and equitable development.

It is the purpose or reason for the existence of an organization
Example: Marketing pharmaceutical products can be the mission of a drugs manufacturing company
Mission talks about present time.

Components of a mission statement:
Customer: Who are the customers?
Product or Service: What are the firms, Major products or services?
Market: Geographically, where does the firm compete?
Technology: is the firm technologically current?
Concern for survival, Growth and profitability: is the firm committed to growth and financial soundness?
Philosophy: what are the basic beliefs, values and ethical priorities of the firm?
Self Concept: What is the firm’s distinctive competence or major competitive advantage?
Concern for public image: Is the firm responsive to social, community and environmental concerns?
Concern for employees: Are employees being considered as valuable assets for the firm?

Mission Statement:
It is the purpose or reason for the existence of an organisation.
For Example: “What is our business?”
Shows what an organization wants to be and whom it wants to serve

Mission Statement example:
The Bellevue Hospital, with respect, compassion, integrity, and courage, honors the individuality and confidentiality of our patients, employees, and community, and is progressive in anticipating and providing future health care services.

Effective Missions/Visions:
- Broad in scope (meaningful)
- Not overly specific
- Reconciles interests among organisation members
- Finely balanced between specificity & generality

Effective Missions:
- Arouse positive feelings & emotions
- Motivate readers to action
- Generate favorable feeling of the firm

Mission Elements:
- Markets
- Technology
- Survival Growth Profit
- Philosophy
- Self-concept
- Public image
- Employees
- Customers
- Products/services

Goals and Objectives:
Quite frequently goals and objectives are used interchangeably
Goal: Is the end target or result
Strategic Goal: Broadly defined targets or future results set by top management. (Top Management)
Tactical Goal: targets or future results usually set by middle management for specific departments or units. (Middle-Management)
Operational Goal: are targets or future results set by lower management. (Lower Management)

Objectives are established at organisational, departmental or individual level
Policies: These are guidelines for action
Example 1: They indicate what is permitted and what is not permitted
Example 2: Promoting people is a personnel policy of a company

It is the actual course of action designed to carry out the established objective
Example: MBA, BBA,DBA etc.

These are very specific actions to be taken or not taken with respect to situation

Example: wearing uniform or reporting to work at a particular time

These are instructions as to how a particular thing should be done
Example: Operating a machine or handling employee complaints

It is the method of shaping a company's future and involves determining the long-run direction of an organisation

Example: A company may have the strategy of diversifying into related business within next few years

Wednesday, January 27, 2010

Process of Planning

The Planning is not one shot activity but an endless process as follows:
- Setting objectives or goals
- Situational Analysis
- Environmental Opportunities
- Course of Action
- Budget Allocations
- Implementation and Review

Setting Objectives:
Objectives are the prime parts of the plan or, planning involves determination of desired future.
Example: you might want to hire some salesmen to increase your market coverage

Situational Analysis:
An organisation must be realistic in assessing its own strengths and weaknesses in the planning process
Example: Rail road (Pen Central) lost its business because they focus only on weakness not strengths so that their sound strategy could be built on its strengths.

Environmental Considerations and Opportunities :
It is said that planning leads to success and to achieve this success, new opportunities must be explored.
Example: Technology developments and economic situation are vital considerations.

Course of Action:
Based on the assessment of internal and external conditions and keeping the objectives and goals in mind, an appropriate course of action must be taken.
Designing a course of action gives a formal structure to the plan itself.
In order to choose course of action, various alternative courses of action must be developed.
The alternatives must be realistic in terms of achievement.

Budget Allocation:
Once the best or optimal course of action is chosen, the next step in the planning process is to set specific targets and allocate resources; these allocations must be stated in quantitative terms

Fixed Budget: Is only for a stated period of time that does not provide allowance for any change in output

Zero-Based Budget: First used by Texas instruments in 1969, by examining the cost-benefit of all activities and ranking them according to the importance to the overall performance of the organization

Implementation and Review:
The last step in the planning process involves putting the plan into action and see whether it is working.

Implementation Involves:
Co-operation of all the members of an organization, to achieve this co-operation, participation must be encouraged.
A follow-up (top to bottom) procedure and other control mechanism must be provided to increase the effective implementation of a plan.

Nature of Planning

According to Koontz and O’Donnell, the four basic principles to be dealt with in understanding the nature of planning are:

Primacy of Planning: This deals with the importance of planning for its central role in linking all the other managerial functions.

Pervasiveness (to persuade planning) of Planning: This brings out the ideas that planning is a function and responsibility of every manager, supervisor, and foreman in an organization.

Contribution to Objectives: Plans are means to achieve some ends and without planning, we can not achieve goals and objectives of an organization.

Efficiency of Planning: Least costly and more beneficial.


- Selection of short- and long-term objectives and the drawing up of tactical and strategic plans to achieve those objectives. In planning, managers outline the steps to be taken in moving the organization toward its objectives. After deciding on a set of strategies to be followed, the organization needs more specific plans, such as locations, methods of financing, hours of operations, and so on. As these plans are made, they will he communicated throughout the organization. When implemented, the plans will serve to coordinate, or meld together, the efforts of all parts of the organization toward the company's objectives.
- Getting ready to do some thing.
- The design of a desired future and of effective ways of bringing it about (Ackoff).
- Planning is a continuing activity since this process goes on and on as long as organizations exist.

Planning exists everywhere and anytime in our lives. Without planning, we can do nothing and we can achieve nothing.

For example; if someone asks you the following question:

Do you want to go anywhere or somewhere?
Of course your answer will be somewhere because anywhere means you haven’t planned anything yet but if you say that you are going somewhere, it means you have planned about it.
By planning, you can save time, resources and energy.

What should a plan be?
A plan should be a realistic view of the expectations. Depending upon the activities, a plan can be long range, intermediate range or short range. It is the framework within which it must operate. For management seeking external support, the plan is the most important document and key to growth. Preparation of a comprehensive plan will not guarantee success, but lack of a sound plan will almost certainly ensure failure.

Purpose of Plan
Just as no two organizations are alike, so also their plans. It is therefore important to prepare a plan keeping in view the necessities of the enterprise. A plan is an important aspect of business. It serves the following three critical functions:
Helps management to clarify, focus, and research their business's or project's development and prospects.
Provides a considered and logical framework within which a business can develop and pursue business strategies over the next three to five years.
Offers a benchmark against which actual performance can be measured and reviewed.

Sunday, January 24, 2010

Management Quotes

- “The conventional definition of management is getting work done through people, but real management is developing people through work.”
- “Management is efficiency in climbing the ladder of success; leadership determines whether the ladder is leaning against the right wall.”
- “Management is doing things right; leadership is doing the right things.”
- “Effective leadership is putting first things first. Effective management is discipline, carrying it out.”
- “Good management is the art of making problems so interesting and their solutions so constructive that everyone wants to get to work and deal with them.”
- “Organization doesn't really accomplish anything. Plans don't accomplish anything, either. Theories of management don't much matter. Endeavors succeed or fail because of the people involved. Only by attracting the best people will you accomplish great deeds.”
- “Effective leadership is not about making speeches or being liked; leadership is defined by results not attributes.”
- “All time management begins with planning.”
- “So much of what we call management consists in making it difficult for people to work”
- “A good manager is a man who isn't worried about his own career but rather the careers of those who work for him.”
- “In the modern world of business, it is useless to be a creative original thinker unless you can also sell what you create. Management cannot be expected to recognize a good idea unless it is presented to them by a good salesman.”
- “Management by objective works - if you know the objectives. Ninety percent of the time you don't.”
- “"Top" management is supposed to be a tree full of owls-hooting when management heads into the wrong part of the forest. I'm still unpersuaded they even know where the forest is.”
- “When a management team with a reputation for brilliance tackles a business with a reputation for bad economics, it is the reputation of the business that remains intact.”
- “Democracy is a form of government in which it is permitted to wonder aloud what the country could do under first-class management”
- “The secret of successful managing is to keep the five guys who hate you away from the four guys who haven't made up their minds.”
- “The smaller the function, the greater the management.”
- “Management means, in the last analysis, the substitution of thought for brawn and muscle, of knowledge for folklore and superstition, and of cooperation for force. . .”
- “Reduce the layers of management. They put distance between the top of an organization and the customers.”
- “No business in the world has ever made more money with poorer management.”
- “If you're playing baseball and thinking about managing, you're crazy. You'd be better off thinking about being an owner.”
- Never give an order that can't be obeyed.
- If you command wisely, you'll be obeyed cheerfully.

Saturday, January 23, 2010


Is a factual piece of writing based on a research you conduct.

Two kinds of Reports:
Short and Long

Short Report:
Are often presented in memorandum form. A short report is concise, accurate and all the inferences depend on supporting evidence to help readers make an informed decision.

Parts of a Report:
 Introduction
 Body
 Terminal Section

Aim or purpose, authorization, sources, scope, definition, background, limits, brief mention of results, list of topics to be discussed

Body (Text):
 Present all relevant facts accurately and impartially. Do not let your personal feelings and prejudices affect the facts.
 Emphasizing important ideas by capitalization, underscoring, boldface, italics, more space and repetitions.
 Include Visual Aids such as graphs, tables, pictures whenever they will help clarify information for your readers or listeners
 Use headings to guide the reader through the report,
 Numeral Letter Combination (II,A, 1, a, (1))
 Decimal System (1.0, 1.1, 1.2,1.21,1.22)
 Letter Numeral Combination (A,1,a,(1),(a))
 Use Topic Sentences for most paragraphs
 Apply the seven C’s writing principles and make your writing easy to read

Terminal Section:
 Summary: A summary condenses the Text
 Conclusion: Evaluates and Infers from the Text
 Recommendation: Offers Specific Courses of Action

Three Kinds of Reports:
Recommendation Justification

Informational Report:
 These reports are basically used to inform the reader about some event or progress in some project or activity

Kinds of Informational Report:
 Conference Report
 Progress Report
 Periodic Report

Conference Reports:
 Are used to talk about the meetings and sessions being held

Progress Reports:
 Are used to show progress, accomplishments, or activity over time or at a given stage of a major assignment

 Introduction will be similar as mentioned before
 Body
 Descriptions of accomplishments during the reporting period
 Unanticipated problems (If any)
 Plans for the next reporting period
 Summary (Overall appraisal of progress to date)
 Terminal Sections will be similar as mentioned before

Periodic Reports:
 Are written in a company’s fiscal year, others may be written weekly, monthly, quarterly or annually.

Analytical Reports:
 Are basically written to analyze a situation or issue
Note: In the Introductory section of the report determine whether you are to recommend a solution or simply analyze a series of alternatives

Recommendation-Justification Report:
• are basically used for persuasion purpose
– Introduction
– Body
• Current state of the problem
• Effects and causes of the problem
• Possible options to remove the problem
• Criteria in evaluating a solution
• Recommended solution
– Terminal Section
• Conclusion
• Recommendation

Letter Writing

Types of letters:

1- Business Letters
 Application for a Job
 Accepting or refusing the offers (employment)
 Complaint/ Reservation
 Requesting service

2- Social Letters
 Letter of congratulation / condolence / apology
 Letter to sick friends / relatives / acquaintances
 Letter of social invitation
 Thank – you –note

Parts of a Letter:
 Heading
 Date
 Inside Address
 Subject Line
 Greeting & Salutation
 Text of the letter
 Closing
 Signature

Theme of a Letter:
 Introduction
 Body (Explanation)
 Terminal Section (Complimentary Section)

Application for a Job

Points to keep in mind:
 An application for a job (Cover Letter) is your first impression making point. Thus, it should be complete, courteous, clear, concise and correct
 Before you write your cover letter, understand the vacancy announcement fully
 Try not to give every detail, mention only your last education and last work experience
 Mention as to where did you get the information from and that you would want to offer your services for which position
 State about your qualification, work experience and the languages that you are proficient in
 Mention your willingness and commitment to the post and your desire for an interview

Reservation Letter

Points to keep in mind:
 A Reservation letter is to book hotels, halls, restaurants, accommodations and seats on the plane etc
 You are to talk on behalf of an organization, so have complete information about the venue, contact person and address
 Provide very clear information in respect to your requirements
 State the purpose of your letter which is of course booking
 Provide complete information in respect to your part and explain the whole details as to what you expect from the opposite side
 Mention that you would want to have a confirmation

Recommendation Letter

Points to keep in mind:
 Recommendation Letters are written on the letterheads of an organization, representing the organization itself
 It states the character, personality, behavior, knowledge and work of an employee
 This letter is given to the employees in recognition to their valuable contribution to the organization
 Mention the name, position and period of time the employee rendered his services to the organization
 Mention as to who or what is your organization
 Elaborate the personality, knowledge and work performance of the employee
 Mention that you could be asked for more information on contact

Complaint Letter

Points to keep in mind:
 Try to be very diplomatic and polite in your statements
 Try to be solution oriented and not without a solution
 Know that this letter will be kept in your personnel file
 Know that incase of any severe criticism, the letter would also show your character and personality
 Know that this letter can damage your relationship in the organization
 Mention as to what is your complaint
 Provide the details and information as to why you are complaining
 State that you would want that some concrete and specific steps must be taken in order to tackle the problem

Resignation Letter

Points to keep in mind:
1. When you decide to tender resignation, you should keep one thing in mind that your letter should be positive and polite
2. Never mention the negative point of the company
3. You have to strive to write a resignation letter that is a bridge builder not bridge burner
4. Mention the effective date of your resignation letter
5. Offer an explanation that should clarify the reasons for your resignation
6. Briefly mention the positive aspects of working for the current employer

Job Interview

Job Interview: is a conversation between an employer and a potential employee for a position vacant in an organization.

Types of Interviews:
1. Chronological Interviews (Structured Interviews)
2. Unstructured Interviews (Informal chat, Interest, Career)
3. Technical Interviews
4. Portfolio based Interview
5. Case Study Interview

Manners in which Interviews are taken:
1. Individual interviews
2. Panel Interviews
3. Telephone Interviews
4. Group Interviews
5. Sequential Interviews

Two parties are involved in a Job Interview:
1. Interviewer
2. Interviewee

Manners of an Interview:
1. Introductory Period
2. Middle Assessment
Company Information, Candidate Assessment
3. Concluding Period

Interview Preparation:
1. Know Yourself
2. Know your resume
3. Know the Company
4. Know the Position
5. Know some questions and answers
6. Know that your Nonverbal appearance communicates loudly
7. Know that your oral delivery also communicates
(Pitch, rate, Volume)
8. Know about the meeting place, time and other details
9. Know some basic salary ranges
10. Know that you must rehearse

Activity During the Interview:
1. Show Enthusiasm, Interest
2. Be honest
3. Listen Attentively
4. Keep Answers Brief
5. Show interest in the company
6. Show analytical skills

Monday, January 18, 2010

The role of a Manager in Afghanistan

Managers in Afghanistan are often fairly paternalistic and for this reason their involvement may extend outside of the workplace into the personal lives of their employees.
The concept of personal strength is important to managers in Afghanistan and as such, it is key that you do not demonstrate any ‘weaknesses’.

Approach to change The need to maintain the status quo and to mitigate any negative impacts on the ‘group’ is greatly valued in Afghanistan. For this reason, you are likely to find that managers in Afghanistan are averse to change. Change therefore takes considerable time to implement and decisions concerning change are preceded by a detailed analysis of risk. Managers in Afghanistan are only likely to follow through with changes if they believe that the change will not threaten the working cohesion of the team. You are unlikely to find people in Afghanistan who are inspired and motivated by opportunities for change.

Decision Making Since managers in Afghanistan are chosen on the basis of their advanced technical and broader business knowledge, then it is not considered appropriate for a manager to liaise with his / her subordinates when making business decisions. In fact, this would result in a loss of respect for managers in Afghanistan as employees may come to the conclusion that they have insufficient knowledge to make the decisions themselves.
Decisions are typically made by the most senior person in an organisation in Afghanistan. Consequently, if a decision needs to be made, then it is more time efficient to direct the request to the most senior respective contact.

Approach to time and priorities Afghanistan is a fluid time culture, and as is the case with many fluid time cultures, it is also very relationship-oriented. People in Afghanistan will not want to upset others in order to force adherence to a deadline, and while appointments and schedules need to be set well in advance as a sign of respect for the individual, you need to understand that those schedules are seen as flexible, not necessarily needing to be adhered to.
Nevertheless, because of the requirements of global business standards, local managers may understand and appreciate the important of adherence to schedules and deadlines.
When working with people from Afghanistan, it’s advisable to reinforce the importance of the agreed-upon deadlines and how that may affect the rest of the organization.

Boss or team player?Due to the hierarchical set up in Afghanistan, it is important that the manager maintains his / her role as ‘boss’ as this engenders respect from within the team.
When the manager needs to work collectively with his / her team however, then it is important that the need to work collectively is stated and that the team are encouraged to operate openly in a non-threatening environment. If contributions are made from a member of the team which are not useful / necessary to the discussion, then the manager will ensure that this is dealt with sensitively as to protect the honour of the individual. To do otherwise, would result in the individual feeling shamed and the rest of the team stepping back from participating.

Communication and negotiation styles The concept of ‘strength’ is important in Afghanistan and as such the win-lose mentality is prevalent. Managers in Afghanistan feel that compromise is a weakness and resist compromise even if it would be of mutual benefit to all concerned. Likewise, if a manager is trying to sell something then securing the highest price is testament to his / her strength.

Being a Manager in Afghanistan

The business set up in Afghanistan is extremely hierarchical and as such strictly defined roles exist.
Managers in Afghanistan are often very paternalistic and relationships with their employees usually overlap into the personal sphere. You may find that managers in Afghanistan give their employees help and assistance with family and even money problems – loaning money where this is considered necessary.
The concept of honour is extremely important and managers in Afghanistan will go to great lengths to protect the honour of their employees. They do this by ensuring that employees are always taken to one side to discuss issues as it would be considered great shame on behalf of the employee if other employees became aware of any issues being discussed. If someone is fairly close to them in status, then the manager will only speak to that individual indirectly about the issue, i.e. describing the issue as a third party act as opposed to something that the individual concerned may have done directly.
Managers in Afghanistan rarely communicate the real reasons to an individual that is being dismissed. Again, this is to protect honour. They will typically tell the individual that the reason for their dismissal is due to budgeting problems for example.

Sunday, January 17, 2010

Peter Ferdinand Drucker’s Biography

Peter Ferdinand Drucker (November 19, 1909 – November 11, 2005) was a writer, management consultant, and self-described “social ecologist.” His books and scholarly and popular articles explored how humans are organized across the business, government and the nonprofit sectors of society. His writings have predicted many of the major developments of the late twentieth century, including privatization and decentralization; the rise of Japan to economic world power; the decisive importance of marketing; and the emergence of the information society with its necessity of lifelong learning. In 1959, Drucker coined the term “knowledge worker" and later in his life considered knowledge work productivity to be the next frontier of management.

Personal life and roots of his philosophyThe son of a high-level civil servant in Austria-Hungary – his mother Caroline Bondi had studied medicine and his father Adolf Drucker was a lawyer – Drucker was born in Vienna, the capital of Austria, in a small village named Kaasgraben (now part of the 19th district of Vienna, Döbling). He grew up in a home where intellectuals, high government officials, and scientists would meet to discuss new ideas. After graduating from Döbling Gymnasium, Drucker found few opportunities for employment in post-Habsburg Vienna, so he moved to Hamburg, Germany, first working as an apprentice at an established cotton trading company, then as a journalist, writing for Der Österreichische Volkswirt (The Austrian Economist). Drucker then moved to Frankfurt, where he took a job at the Daily Frankfurter General-Anzeiger. While in Frankfurt, he also earned a doctorate in international law and public law from the University of Frankfurt in 1931. Among his early influences was the Austrian economist Joseph Schumpeter, a friend of his father’s, who impressed upon Drucker the importance of innovation and entrepreneurship. Drucker was also influenced, in a much different way, by John Maynard Keynes, whom he heard lecture in 1934 in Cambridge. “I suddenly realized that Keynes and all the brilliant economic students in the room were interested in the behavior of commodities,” Drucker wrote, “while I was interested in the behavior of people.”
Over the next 70 years, Drucker’s writings would be marked by a focus on relationships among human beings, as opposed to the crunching of numbers. His books were filled with lessons on how organizations can bring out the best in people, and how workers can find a sense of community and dignity in a modern society organized around large institutions.
As a young writer, Drucker wrote two pieces — one on the conservative German philosopher Friedrich Julius Stahl and another called “The Jewish Question in Germany” — that were burned and banned by the Nazis. In 1933, Drucker left Germany for England. In London, he worked for an insurance company, then as the chief economist at a private bank. He also reconnected with Doris Schmitz, an acquaintance from the University of Frankfurt. They married in 1934. (His wedding certificate lists his name as Peter Georg Drucker.) The couple permanently relocated to the United States, where he became a university professor as well as a free-lance writer and business consultant. (Drucker disliked the term “guru,” though it was often applied to him; “I have been saying for many years,” Drucker once remarked, “that we are using the word ‘guru’ only because ‘charlatan’ is too long to fit into a headline.”)
In 1943, Drucker became a naturalized citizen of the United States. He taught at Bennington College from 1942-1949, then at New York University as a Professor of Management from 1950 to 1971. Drucker came to California in 1971, where he developed one of the country's first executive MBA programs for working professionals at Claremont Graduate University (then known as Claremont Graduate School). From 1971 to his death he was the Clarke Professor of Social Science and Management at Claremont Graduate University. The university's management school was named the "Peter F. Drucker Graduate School of Management" (later known as the "Peter F. Drucker and Masatoshi Ito Graduate School of Management") in his honor in 1987. He taught his last class at the school in 2002 at age 92.

CareerHis career as a business thinker took off in 1942, when his initial writings on politics and society won him access to the internal workings of General Motors (GM), one of the largest companies in the world at that time. His experiences in Europe had left him fascinated with the problem of authority. He shared his fascination with Donaldson Brown, the mastermind behind the administrative controls at GM. In 1943 Brown invited him in to conduct what might be called a "political audit": a two-year social-scientific analysis of the corporation. Drucker attended every board meeting, interviewed employees, and analyzed production and decision-making processes.
The resulting book, Concept of the Corporation, popularized GM's multidivisional structure and led to numerous articles, consulting engagements, and additional books. GM, however, was hardly thrilled with the final product. Drucker had suggested that the auto giant might want to reexamine a host of long-standing policies on customer relations, dealer relations, employee relations and more. Inside the corporation, Drucker’s counsel was viewed as hypercritical. GM's revered chairman, Alfred Sloan, was so upset about the book that he “simply treated it as if it did not exist,” Drucker later recalled, “never mentioning it and never allowing it to be mentioned in his presence.”
Drucker taught that management is “a liberal art,” and he infused his management advice with interdisciplinary lessons from history, sociology, psychology, philosophy, culture and religion. He also believed strongly that all institutions, including those in the private sector, have a responsibility to the whole of society. “The fact is,” Drucker wrote in his 1973 Management: Tasks, Responsibilities, Practices, “that in modern society there is no other leadership group but managers. If the managers of our major institutions, and especially of business, do not take responsibility for the common good, no one else can or will.”
Drucker was interested in the growing effect of people who worked with their minds rather than their hands. He was intrigued by employees who knew more about certain subjects than their bosses or colleagues and yet had to cooperate with others in a large organization. Rather than simply glorify the phenomenon as the epitome of human progress, Drucker analyzed it and explained how it challenged the common thinking about how organizations should be run.
His approach worked well in the increasingly mature business world of the second half of the twentieth century. By that time, large corporations had developed the basic manufacturing efficiencies and managerial hierarchies of mass production. Executives thought they knew how to run companies, and Drucker took it upon himself to poke holes in their beliefs, lest organizations become stale. But he did so in a sympathetic way. He assumed that his readers were intelligent, rational, hardworking people of good will. If their organizations struggled, he believed it was usually because of outdated ideas, a narrow conception of problems, or internal misunderstandings.
During his long consulting career, Drucker worked with many major corporations, including General Electric, Coca-Cola, Citicorp, IBM, and Intel. He consulted with notable business leaders such as GE’s Jack Welch; Procter & Gamble’s A.G. Lafley; Intel’s Andy Grove; Edward Jones’ John Bachmann; Shoichiro Toyoda, the honorary chairman of Toyota Motor Corp.; and Masatoshi Ito, the honorary chairman of the Ito-Yokado Group, the second largest retailing organization in the world. Although he helped many corporate executives succeed, he was appalled when the level of Fortune 500 CEO pay in America ballooned to hundreds of times that of the average worker. He argued in a 1984 essay that CEO compensation should be no more than 20 times what the rank and file make — especially at companies where thousands of employees are being laid off. “This is morally and socially unforgivable,” Drucker wrote, “and we will pay a heavy price for it.”
Drucker served as a consultant for various government agencies in the United States, Canada and Japan. He worked with various nonprofit organizations to help them become successful, often consulting pro bono. Among the many social-sector groups he advised were the Salvation Army, the Girl Scouts of the USA, C.A.R.E., the American Red Cross, and the Navajo Indian Tribal Council.
In fact, Drucker anticipated the rise of the social sector in America, maintaining that it was through volunteering in nonprofits that people would find the kind of fulfillment that he originally thought would be provided through their place of work, but that had proven elusive in that arena. “Citizenship in and through the social sector is not a panacea for the ills of post-capitalist society and post-capitalist polity, but it may be a prerequisite for tackling these ills,” Drucker wrote. “It restores the civic responsibility that is the mark of citizenship, and the civic pride that is the mark of community.”

AuthorDrucker's 39 books have been translated into more than thirty languages. Two are novels, one an autobiography. He is the co-author of a book on Japanese painting, and made eight series of educational films on management topics. He also penned a regular column in the Wall Street Journal for 20 years and contributed frequently to the Harvard Business Review, The Atlantic Monthly, and The Economist. He continued to act as a consultant to businesses and non-profit organizations well into his nineties. Drucker died November 11, 2005 in Claremont, California of natural causes at 95.

Basic ideasSeveral ideas run through most of Drucker's writings:
Decentralization and simplification. Drucker discounted the command and control model and asserted that companies work best when they are decentralized. According to Drucker, corporations tend to produce too many products, hire employees they don't need (when a better solution would be outsourcing), and expand into economic sectors that they should avoid.
A profound skepticism of macroeconomic theory. Drucker contended that economists of all schools fail to explain significant aspects of modern economies.
Respect of the worker. Drucker believed that employees are assets and not liabilities. He taught that knowledge workers are the essential ingredients of the modern economy. Central to this philosophy is the view that people are an organization's most valuable resource and that a manager's job is to prepare and free people to perform.
A belief in what he called "the sickness of government." Drucker made nonpartisan claims that government is often unable or unwilling to provide new services that people need or want, though he believed that this condition is not inherent to the form of government. The chapter "The Sickness of Government" in his book The Age of Discontinuity formed the basis of the New Public Management, a theory of public administration that dominated the discipline in the 1980s and 1990s.
The need for "planned abandonment". Businesses and governments have a natural human tendency to cling to "yesterday's successes" rather than seeing when they are no longer useful.
A belief that taking action without thinking is the cause of every failure.
The need for community. Early in his career, Drucker predicted the "end of economic man" and advocated the creation of a "plant community" where individuals' social needs could be met. He later acknowledged that the plant community never materialized, and by the 1980s, suggested that volunteering in the nonprofit sector was the key to fostering a healthy society where people found a sense of belonging and civic pride.
The need to manage business by balancing a variety of needs and goals, rather than subordinating an institution to a single value.This concept of management by objectives forms the keynote of his 1954 landmark The Practice of Management.
A company's primary responsibility is to serve its customers. Profit is not the primary goal, but rather an essential condition for the company's continued existence.
An organization should have a proper way of executing all its business processes.
A belief in the notion that great companies could stand among humankind's noblest inventions.

Awards and honorsDrucker was awarded the Presidential Medal of Freedom by U.S. President George W. Bush on July 9, 2002[1]. He also received honors from the governments of Japan and Austria. He was the Honorary Chairman of the Peter F. Drucker Foundation for Nonprofit Management, now the Leader to Leader Institute, from 1990 through 2002. In 1969 he was awarded New York University’s highest honor, the NYU Presidential Citation. Harvard Business Review honored Drucker in the spring of 2005 with his seventh McKinsey Award for his article, "What Makes an Effective Executive", the most awarded to one person. Drucker was inducted into the Junior Achievement U.S. Business Hall of Fame in 1996. Additionally he holds 25 honorary doctorates from American, Belgian, Czech, English, Spanish and Swiss Universities. In Claremont, California, Eleventh Street between College Avenue and Dartmouth Avenue was renamed "Drucker Way" in October of 2009 to commemorate the 100th anniversary of Drucker's birth.

Criticism (This article's Criticism or Controversy section(s) may mean the article does not present a neutral point of view of the subject. It may be better to integrate the material in those sections into the article as a whole.)
The Wall Street Journal researched several of his lectures in 1987 and reported that he was sometimes loose with the facts. Drucker was off the mark, for example, when he told an audience that English was the official language for all employees at Japan’s Mitsui trading company. (Drucker’s defense: “I use anecdotes to make a point, not to write history.”) And while he was known for his prescience, he wasn’t always correct in his forecasts. He anticipated, for instance, that the nation’s financial center would shift from New York to Washington.
Others maintain that one of Drucker’s core concepts—“management by objectives”—is flawed and has never really been proven to work effectively. Specifically, critics say that the system is difficult to implement, and that companies often wind up overemphasizing control, as opposed to fostering creativity, to meet their goals.

List of publicationsFriedrich Julius Stahl: konservative Staatslehre und geschichtliche Entwicklung (1932)
The End of Economic Man: The Origins of Totalitarianism (1939) Google Booksearch Preview
The Future of Industrial Man (1942)
Concept of the Corporation (1945) (A study of General Motors)
The New Society (1950)
The Practice of Management (1954)
America's Next 20 Years (1957)
Landmarks of Tomorrow: A Report on the New 'Post-Modern' World (1959)
Power and Democracy in America (1961)
Managing for Results: Economic Tasks and Risk-Taking Decisions (1964)
The Effective Executive (1967)
The Age of Discontinuity (1968)
Technology, Management and Society (1970)
Men, Ideas and Politics (1971)
Management: Tasks, Responsibilities and Practices (1973)
The Unseen Revolution: How Pension Fund Socialism Came to America (1976)
An Introductory View of Management (1977)
Adventures of a Bystander (1979) (Autobiography)
Song of the Brush: Japanese Paintings from the Sanso Collection (1979)
Managing in Turbulent Times (1980)
Toward the Next Economics and Other Essays (1981)
The Changing World of the Executive (1982)
The Last of All Possible Worlds (1982)
The Temptation to Do Good (1984)
Innovation and Entrepreneurship: Practice and Principles (1985)
The Discipline of Innovation, Harvard Business Review, 1985
The Frontiers of Management (1986)
The New Realities (1989)
Managing the Non-Profit Organization: Practices and Principles (1990)
Managing for the Future: The 1990s and Beyond (1992)
The Post-Capitalist Society (1993)
The Ecological Vision: Reflections on the American Condition (1993)
The Theory of the Business, Harvard Business Review, September-October 1994
Managing in a Time of Great Change (1995)
Drucker on Asia: A Dialogue Between Peter Drucker and Isao Nakauchi (1997)
Peter Drucker on the Profession of Management (1998)
Management Challenges for the 21st century (1999)
Managing Oneself, Harvard Business Review, March-April 1999
The Essential Drucker: The Best of Sixty Years of Peter Drucker's Essential Writings on Management (2001)
Leading in a Time of Change: What it Will Take to Lead Tomorrow (2001; with Peter Senge)
The Effective Executive Revised (2002)
They're Not Employees, They're People, Harvard Business Review, February 2002
Managing in the Next Society (2002)
A Functioning Society (2003)
The Daily Drucker: 366 Days of Insight and Motivation for Getting the Right Things Done (2004)
What Makes An Effective Executive, Harvard Business Review, June 2004.
The Effective Executive in Action (2005)
Classic Drucker (2006)

Quotes "In fact, that management has a need for advanced education – as well as for systematic manager development – means only that management today has become an institution of our society."[28]
"The best way to predict the future is to create it."
"Management is doing things right; leadership is doing the right things."
"What's measured improves."
“Company cultures are like country cultures. Never try to change one. Try, instead, to work with what you've got.”
“Efficiency is doing better what is already being done."
“Follow effective action with quiet reflection. From the quiet reflection will come even more effective action.”
“People who don't take risks generally make about two big mistakes a year. People who do take risks generally make about two big mistakes a year.”
“The most important thing in communication is hearing what isn't said.”
“The purpose of business is to create and keep a customer.”
“There is nothing so useless as doing efficiently that which should not be done at all.”
“When a subject becomes totally obsolete we make it a required course.”
"Rank does not confer privilege or give power. It imposes responsibility."
"To focus on contribution is to focus on effectiveness."
"People in any organization are always attached to the obsolete – the things that should have worked but did not, the things that once were productive and no longer are."
"Wherever you see a successful business, someone once made a courageous decision."
"Most of what we call management consists of making it difficult for people to get their work done."
"You can only manage what you can measure."
"What everybody knows is frequently wrong."
"Do not simply cling to your past successes, be willing to change, adopt new ideas and continually review all the different segments of business."
"success breeds success" "nothing succeeds like success" This statement from "A Class With Drucker" states that if you know you can succeed at something, then automatically you'll have the self confidence to do it. If you have been successful in the past, you have a better chance at being successful again.
"A leader, any leader, must act for the benefit of others and not for oneself,"

Cyril O'Donnell’s Biography

(December 1900 – February 16, 1976) Cyril O’Donnell was a prolific professor and teacher of management at the University of California at Los Angeles. He consulted on operations management topics for some of the largest US corporations such as Hughes Aircraft, as well as the government of Jamaica . He was a co-author of the book Principles of Management with Harold Koontz which sold more than two million copies worldwide with translations in 15 languages.
Cyril O'Donnell was a pioneer along with others such as George Terry, Harold Koontz and Ralph Davis. All of which published management textbooks in the 1950s that defined management as a process consisting of a set of interdependent functions. These and several other management experts became identified with what came to be known as the process school of management.
Professor O'Donnell was born in Lincoln, Nebraska in December 1900. He grew up in rural Alberta, Canada, and attended the University of Alberta, from which he received the Bachelor of Commerce degree in 1924 and the Master of Arts degree in 1926. He returned to the United States and in 1930 was appointed chairman of the Department of Economics at DePaul University. In 1944 Professor O'Donnell received his Ph.D. from the University of Chicago.
In 1948, Cyril joined the faculty at UCLA where he taught business and management to undergraduate, graduate and business executives. He also served as chairman of the board of control for UCLA. He retired in 1968 and continued to consult for various corporations and entities.
Cyril J. O'Donnell died at home in Bel Air, California on February 16, 1976 at the age of seventy-six.

Harold Koontz’s Biography

Harold Koontz, was a consultant for US's largest business organizations. He co-authored the book Principles of Management with Cyril J. O'Donnell which has sold around two million copies and has been translated into 15 languages. He died at the age of 75 on Feb 11 1984, after suffering from arthritis.
Mr. Koontz, was a professor of business management at University of California, Los Angeles. He started as a cost analyst in 1936, he received his doctorate from Yale University. his approach to management was "human relations". He rightly said manage-men-t. where "t" stands for tactfully.
Harold Koontz, an adviser to many of the country's largest industries and author of the best-selling book ''Principles of Management,'' is dead at the age of 75.
Mr. Koontz, a professor emeritus of business management at the University of California at Los Angeles, died in Encino on Feb. 11, university officials announced Friday.
He had suffered from arthritis.
His ''Principles of Management,'' now in its eighth edition, has sold nearly two million copies and has been translated into 15 languages.
Mr. Koontz started his career as a cost analyst for the New York, New Haven and Hartford Railroad in 1936, a year after he received a doctorate from Yale University.
He had been a consultant for the Federal Office of Price Administration in World War II, an executive with Trans World Airlines, a research aide for the Association of American Railroads and a director of many other companies.
A university spokesman, Debbie Dutra, said funeral services were held Tuesday in Los Angeles.

Russell Lincoln Ackoff’s Biography

Russell Lincoln Ackoff (12 February 1919 - 29 October 2009) was an American organizational theorist, consultant, and Anheuser-Busch Professor Emeritus of Management Science at the Wharton School, University of Pennsylvania. Ackoff was a pioneer in the field of operations research, systems thinking and management science.
Russell L. Ackoff was born in 1919 in Philadelphia to Jack and Fannie (Weitz) Ackoff. He received his bachelor degree in Architecture at the University of Pennsylvania in 1941. He stayed at this university for one year as assistant instructor in philosophy. From 1942 to 1946 he joined the U.S. Army. He returned to study at the University of Pennsylvania, where he received his doctorate in philosophy of science in 1947 as C. West Churchman’s first doctoral student. He also received a doctorate of science from the University of Lancaster in 1967.
From 1947 to 1951 Ackoff was assistant professor in philosophy and mathematics at the Wayne State University. He was associate professor and professor of operations research at Case Institute of Technology from 1951 to 1964. In 1961 and 1962 he was also visiting professor of operational research at the University of Birmingham. From 1964 to 1986 he was professor of systems sciences and professor of management science at the Wharton School at the University of Pennsylvania.
In the 1970s and 1980s the Social Systems Sciences Program at the Wharton School, according to Nicholson and Myers (1998), was "noted for combining theory and practice, escaping disciplinary bounds, and driving students toward independent thought and action. The learning environment was fostered by distinguished standing and visiting faculty such as Eric Trist, C. West Churchman, Hasan Ozbekhan, Thomas A. Cowan, and Fred Emery".
Since 1979 Ackoff worked together with John Pourdehnad as consultants in a broad range of industries including aerospace, chemicals, computer equipment, data services and software, electronics, energy, food and beverages, healthcare, hospitality, industrial equipment, automotive, insurance, metals, mining, pharmaceuticals, telecommunications, utilities, and transportation.
From 1986 to 2009, Ackoff was professor emeritus of the Wharton School, and chairman of Interact, the Institute for Interactive Management. From 1989 to 1995 he was visiting professor of marketing at Washington University in St. Louis.
Ackoff was president of Operations Research Society of America (ORSA) in 1956–1957, and he was president of the International Society for the Systems Sciences (ISSS) in 1987.
Ackoff was awarded an honorary Doctor of Science at the University of Lancaster, UK in 1967. He got a Silver Medal from the Operational Research Society in 1971. Other honors came from the Washington University in St. Louis in 1993, the University of New Haven in 1997, the Pontificia Universidad Catholica Del Peru, Lima in 1999 and the University of Lincolnshire & Humberside, UK in 1999. That year from the UK Systems Society he got an Award for outstanding achievement in Systems Thinking and Practice.
Ackoff married Alexandra Makar on July 17, 1949.[1] This union produced three children: Alan W., Karen B., and Karla S.[1] After the death of Alexandra in February, 1987, Ackoff married Helen Wald on December 20, 1987.
Ackoff died on October 29, 2009.

WorkThroughout the years Ackoff's work in research, consulting and education has involved more than 250 corporations and 50 governmental agencies in the U.S. and abroad.

Operations researchRussell Ackoff started his career in Operations Research at the end of the 1940s. His 1957 book Introduction to Operations Research, co-authored with C. West Churchman and Leonard Arnoff, was one of the first publications that helped define the field. The influence of this work, according to Kirby and Rosenhead (2005), "on the early development of the discipline in the USA and in Britain in the 1950s and 1960s is hard to over-estimate".
In the 1970s he become one of the most important critics of the so called "technique-dominated Operations Research", and starting proposing more participative approaches. His critics, according to Kirby and Rosenhead (2005), had "resonance within the USA, but were picked up both in Britain, where they helped to stimulate the growth of Problem Structuring Methods, and in the systems community world-wide", such as Soft systems methodology from Peter Checkland.

Purposeful systemsIn 1972 Ackoff wrote a book with Frederick Edmund Emery about purposeful systems, which focused on the question how systems thinking relates to human behaviour. "Individual systems are purposive", they said, "knowledge and understanding of their aims can only be gained by taking into account the mechanisms of social, cultural, and psychological systems".
Any human-created systems can be characterized as "purposeful system" when it's "members are also purposeful individuals who intentionally and collectively formulate objectives and are parts of larger purposeful systems". Other characteristics are:
"A purposeful system or individual is ideal-seeking if... it chooses another objective that more closely approximates its ideal".
"An ideal-seeking system or individual is necessarily one that is purposeful, but not all purposeful entities seek ideals", and
"The capability of seeking ideals may well be a characteristic that distinguishes man from anything he can make, including computers".
According to Kirby and Rosenhead (2005), "the fact that these systems were experiencing profound change could be attributed to the end of the "Machine Age" and the onset of the "Systems Age". The Machine Age, bequeathed by the Industrial Revolution, was underpinned by two concepts – reductionism (everything can in the end be decomposed into indivisible parts) and mechanism (cause-effect relationships)". Hereby "all phenomena were believed to be explained by using only one ultimately simple relationship, cause-effect", which in the Systems Age are replaced by expansionism and teleology with producer-product replacing cause-effect. "Expansionism is a doctrine maintaining that all objects and events, and all experiences of them, are parts of larger wholes." According to Ackoff, "the beginning of the end of the Machine Age and the beginning of the Systems Age could be dated to the 1940s, a decade when philosophers, mathematicians, and biologists, building on developments in the interwar period, defined a new intellectual framework".

f-LawsIn 2006, Ackoff worked with Herbert J. Addison and Sally Bibb. They developed the term f-Law to describe a series of over 100 distilled observations of bad leadership and the misplaced wisdom that often surrounds management in organizations. A collection of subversive epigrams published in two volumes by Triarchy Press, these f-Laws expose the common flaws in both the practice of leadership and in the established beliefs that surround it. According to Ackoff "f-Laws are truths about organizations that we might wish to deny or ignore - simple and more reliable guides to managers' everyday behavior than the complex truths proposed by scientists, economists, sociologists, politicians and philosophers".

White House Communications AgencyIn collaboration with Dr. J. Gerald Suarez, Ackoff's ideas were introduced and implemented at the White House Communications Agency and The White House Military Office during the Clinton and Bush administrations, a historic effort to bring the White House into the age of systems thinking.

Relationship to Peter DruckerRussell Ackoff was friends with Peter Drucker from the earliest days of their careers. Mr. Drucker acknowledged the early, critical contribution Ackoff made to his work - and the world of management in general - in the following letter, which was delivered to Ackoff by former General Motors V.P. Vince Barabba on the occasion of the 3rd International Conference on Systems Thinking in Management (ICSTM) held at the University of Pennsylvania, May 19-24, 2004:
“I was then, as you may recall, one of the early ones who applied Operations Research and the new methods of Quantitative Analysis to specific BUSINESS PROBLEMS -- rather than, as they had been originally developed for, to military or scientific problems. I had led teams applying the new methodology in two of the world’s largest companies -- GE and AT&T. We had successfully solved several major production and technical problems for these companies -- and my clients were highly satisfied. But I was not--we had solved TECHNICAL problems but our work had no impact on the organizations and on their mindsets. On the contrary: we had all but convinced the managements of these two big companies that QUANTITATIVE MANIPULATION was a substitute for THINKING. And then your work and your example showed us--or at least, it showed me--that the QUANTITATIVE ANALYSIS comes AFTER the THINKING -- it validates the thinking; it shows up intellectual sloppiness and uncritical reliance on precedent, on untested assumptions and on the seemingly “obvious.” But it does not substitute for hard, rigorous, intellectually challenging THINKING. It demands it, though -- but does not replace it. This is, of course, what YOU mean BY system. And your work in those far-away days thus saved me -- as it saved countless others -- from either descending into mindless “model building” -- the disease that all but destroyed so many of the Business Schools in the last decades -- or from sloppiness parading as ‘insight.’”

Saturday, January 16, 2010

Henry Mintzberg's Biography

From Wikipedia…Professor Henry Mintzberg, OC, OQ, FRSC (born in Montreal, September 2, 1939) is an internationally renowned academic and author on business and management. He is currently the Cleghorn Professor of Management Studies at the Desautels Faculty of Management of McGill University in Montreal, Quebec, Canada, where he has been teaching since 1968, after earning his Master's degree in Management and Ph.D. from the MIT Sloan School of Management in 1965 and 1968 respectively. His undergraduate degree in mechanical engineering was from McGill University. From 1991 to 1999, he was a visiting professor at INSEAD.
Henry Mintzberg writes prolifically on the topics of management and business strategy, with more than 150 articles and fifteen books to his name. His seminal book, The Rise and Fall of Strategic Planning (Mintzberg 1994), criticizes some of the practices of strategic planning today.
He recently published a book entitled Managers Not MBAs (Mintzberg 2004) which outlines what he believes to be wrong with management education today. Rather controversially, Mintzberg claims that prestigious graduate management schools like Harvard Business School and the Wharton Business School at the University of Pennsylvania are obsessed with numbers and that their overzealous attempts to make management a science are damaging the discipline of management. Mintzberg advocates more emphasis on post graduate programs that educate practicing managers (rather than students with little real world experience) by relying upon action learning and insights from their own problems and experiences.
Ironically, although Professor Mintzberg is quite critical about the strategy consulting business, he has twice won the McKinsey Award for publishing the best article in the Harvard Business Review. Also, he is credited with co-creating the organigraph, which is taught in business schools.
In 1997 he was made an Officer of the Order of Canada. In 1998 he was made an Officer of the National Order of Quebec. He is now a member of the Strategic Management Society.
MIntzberg runs two programs which have been designed to teach his alternative approach to management and strategic planning at McGill University: the International Masters in Practicing Management (I.M.P.M.) in association with the McGill Executive Institute and the International Masters for Health Leadership (I.M.H.L.). With Phil LeNir, he owns CoachingOurselves International, a private company using his alternative approach for management development directly in the workplace.
He is married to Sasha Sadilova and has two children from a previous marriage, Susie and Lisa.
Theory on Organizational Forms
The organizational configurations framework of Mintzberg is a model that describes six valid organizational configurations
Mutual adjustment, which achieves coordination by the simple process of informal communication (as between two operating employees)
Direct supervision, is achieved by having one person issue orders or instructions to several others whose work interrelates (as when a boss tells others what is to be done, one step at a time)
Standardization of work processes, which achieves coordination by specifying the work processes of people carrying out interrelated tasks (those standards usually being developed in the technostructure to be carried out in the operating core, as in the case of the work instructions that come out of time-and-motion studies)
Standardization of outputs, which achieves coordination by specifying the results of different work (again usually developed in the technostructure, as in a financial plan that specifies subunit performance targets or specifications that outline the dimensions of a product to be produced)
Standardization of skills (as well as knowledge), in which different work is coordinated by virtue of the related training the workers have received (as in medical specialists - say a surgeon and an anesthetist in an operating room –responding almost automatically to each other’s standardized procedures)
Standardization of norms, in which it is the norms infusing the work that are controlled, usually for the entire organization, so that everyone functions according to the same set of beliefs (as in a religious order)
According to the organizational configurations model of Mintzberg each organization can consist of a maximum of six basic parts:
Strategic Apex (top management)
Middle Line (middle management)
Operating Core (operations, operational processes)
Technostructure (analysts that design systems, processes, etc)
Support Staff (support outside of operating workflow)
Ideology (halo of beliefs and traditions; norms, values, culture)

Horizontal Dimension: Responsibility areas

In horizontal differentiation, there are three major types of managerial jobs:
Functional, general and project.
- Functional managers: who are responsible for a specific, specialized organization area such as procurement officer and finance manager…
- General Managers: who are responsible for a whole unit or department of an organization or a substantial sub nit including most of the common specialized areas.
- Project managers: who are responsible for coordinating efforts involving individuals in several different organizational units all working on a particular project.

Promoting Innovation: The Entrepreneurial role

- Innovation: A new idea applied to initiating or improving a process, product or service.
Example: discovering and exploiting new opportunities.
- Intrapreneurs: individuals who engage in entrepreneurial roles inside organizations.
- Intrapreneurship: the process of innovating within and existing organization.
- Idea Champion: Individuals who generate a new idea or believe in the value of a new idea.

Managerial Roles

A role is organized set of behavior associated with particular office or position.
Every action you perform in an organization is equal to behavior.
3 general types of roles by Henry Mintzberg are:
1- Interpersonal rules: involves developing and maintain positive relationship with others.
We can develop relationships by coordinating and participating, using good behavior and ethics, strong communication between departments. When we developed relationship, we should maintain them as well. Interpersonal roles include the followings:
- Figurehead: Performs symbolic duties or representation. They participate in ceremonial activities, who are the responsible of an organization, owner of a company, chief executive, top level managers.
- Leaders: build relationship with subordinates and communicates with them and also motivates them.
- Laison: maintain networks of contacts with outside, it may be, company to company, department to department and unit to unit….

2- Informational rules: receiving and transmitting information.
- Monitor: seeks internal and external information about issues affecting organization.
- Disseminator: transmits information internally obtained to either internal or external sources. Getting information from inside and transmit them to outside.
- Spokesperson: transmits information about the organization to outsider.

3- Decisional rules: making significant decisions affecting the organization.
- Entrepreneur: acts as initiator and encourager of change and innovation. Creates new ideas for the company.
- Disturbance handler: takes corrective actions when the organization faces unexpected problems.
- Resource allocator: distributes resources of all types including time, funding, equipment and human resources.
- Negotiator: sometimes negotiates with other managers.

Fayol's definition of Management

Fayol's definition of management roles and actions distinguishes between Five Elements:
Prevoyance (Forecast & Plan): Examining the future and drawing up a plan of action. The elements of strategy.
To organize. Build up the structure, both material and human, of the undertaking.
To command. Maintain the activity among the personnel.
To coordinate. Binding together, unifying and harmonizing all activity and effort.
To control. Seeing that everything occurs in conformity with established rule and expressed command.

Henry Fayol's Biography

Henri Fayol (1841-1925) was a French management theorist whose theories in management and organization of labor were widely influential in the beginning of 20th century. He was a mining engineer who worked for a French mining company Commentry-Fourchamboult-Decazeville, first as an engineer. Then he moved into general management and became Managing Director from 1888 to 1918. During his tenure as Managing Director he wrote various articles on 'administration' and in 1916 the Bulletin de la Société de l’ Industrie Minérale, printed his "Administration, Industrielle et Générale – Prévoyance, Organisation, Commandement, Coordination, Contrôle". In 1949 the first English translation appeared: ‘General and Industrial Management’ by Constance Storrs.
Henri Fayol (Istanbul, 29 July 1841–Paris, 19 November 1925) was a French mining engineer, director of mines, and management theorist, who developed independent of the theory of Scientific Management, a general theory of business administration[1] also known as Fayolism. He was one of the most influential contributors to modern concepts of management.
Fayol was born in 1841 in a suburb of Istanbul, Turkey, where his father, an engineer, was appointed superintendent of works to build a bridge over the Golden Horn[1] (Galata Bridge). They returned to France in 1847. Fayol studied at the mining school "École Nationale Supérieure des Mines" in Saint-Étienne.
When 19 years old he started as an engineer at a mining company "Compagnie de Commentry-Fourchambeau-Decazeville" in Commentry. He became director in 1888, when the mine company employed over 1,000 people, and held that position over 30 years until 1918. By 1900 the company was one of the largest producers of iron and steel in France and was regarded as a vital industry.[1]
In 1916 he published his experience in the book "Administration Industrielle et Générale", only a few years after Frederick Winslow Taylor had published his theory of Scientific Management.
Fayolism is one of the first comprehensive statements of a general theory of management,[2] developed by Fayol. He has proposed that there are six primary functions of management and 14 principles of management[3]

Controlling is described in the sense that a manager must receive feedback about a process in order to make necessary adjustments. Principles of Management
Division of work. This principle is the same as Adam Smith's 'division of labour'. Specialisation increases output by making employees more efficient.
Authority. Managers must be able to give orders. Authority gives them this right. Note that responsibility arises wherever authority is exercised.
Discipline. Employees must obey and respect the rules that govern the organisation. Good discipline is the result of effective leadership, a clear understanding between management and workers regarding the organisation's rules, and the judicious use of penalties for infractions of the rules.
Unity of command. Every employee should receive orders from only one superior.
Unity of direction. Each group of organisational activities that have the same objective should be directed by one manager using one plan.
Subordination of individual interests to the general interest. The interests of any one employee or group of employees should not take precedence over the interests of the organisation as a whole.
Remuneration. Workers must be paid a fair wage for their services.
Centralisation. Centralisation refers to the degree to which subordinates are involved in decision making. Whether decision making is centralised (to management) or decentralised (to subordinates) is a question of proper proportion. The task is to find the optimum degree of centralisation for each situation.
Scalar chain. The line of authority from top management to the lowest ranks represents the scalar chain. Communications should follow this chain. However, if following the chain creates delays, cross-communications can be allowed if agreed to by all parties and superiors are kept informed.
Order. People and materials should be in the right place at the right time.
Equity. Managers should be kind and fair to their subordinates.
Stability of tenure of personnel. High employee turnover is inefficient. Management should provide orderly personnel planning and ensure that replacements are available to fill vacancies.
Initiative. Employees who are allowed to originate and carry out plans will exert high levels of effort.
Esprit de corps. Promoting team spirit will build harmony and unity within the organisation.
Fayol's work has stood the test of time and has been shown to be relevant and appropriate to contemporary management. Many of today’s management texts including Daft[4] have reduced the six functions to four: (1) planning; (2) organizing; (3) leading; and (4) controlling. Daft's text is organized around Fayol's four functions.

14 Principles of Management

The 14 Management Principles from Henri Fayol (1841-1925) are as follows
Division of Work: Specialization allows the individual to build up experience, and to continuously improve his skills. Thereby he can be more productive
Authority: The right to issue commands, along with which must go the balanced responsibility for its function
Discipline: Employees must obey, but this is two-sided: employees will only obey orders if management play their part by providing good leadership
Unity of Command: Each worker should have only one boss with no other conflicting lines of command
Unity of Direction: People engaged in the same kind of activities must have the same objectives in a single plan. This is essential to ensure unity and coordination in the enterprise. Unity of command does not exist without unity of direction but does not necessarily flows from it
Subordination of individual interest (to the general interest): Management must see that the goals of the firms are always paramount
Remuneration: Payment is an important motivator although by analyzing a number of possibilities, Fayol points out that there is no such thing as a perfect system
Centralization (or Decentralization): This is a matter of degree depending on the condition of the business and the quality of its personnel
Scalar chain (Line of Authority): A hierarchy is necessary for unity of direction. But lateral communication is also fundamental, as long as superiors know that such communication is taking place. Scalar chain refers to the number of levels in the hierarchy from the ultimate authority to the lowest level in the organization. It should not be over-stretched and consist of too-many levels
Order: Both material order and social order are necessary. The former minimizes lost time and useless handling of materials. The latter is achieved through organization and selection
Equity: In running a business a ‘combination of kindliness and justice’ is needed. Treating employees well is important to achieve equity
Stability of Tenure of Personnel: Employees work better if job security and career progress are assured to them. An insecure tenure and a high rate of employee turnover will affect the organization adversely
Initiative: Allowing all personnel to show their initiative in some way is a source of strength for the organization. Even though it may well involve a sacrifice of ‘personal vanity’ on the part of many managers
Esprit de Corps: Management must foster the morale of its employees. He further suggests that: “real talent is needed to coordinate effort, encourage keenness, use each person’s abilities, and reward each one’s merit without arousing possible jealousies and disturbing harmonious relations

Functions of Management

Following are the key functions of Management:
PlanningPlanning is the process of setting goals and deciding how best to achieve them.
OrganizingOrganizing is the process of allocating and arranging human (staffs) and non human (budget) resources so that plans can be carried out successfully.
Leading The process of influencing others to engage in the work behaviors necessary to reach organizational goals.
Controlling The process of regulating organizational activities so that actual performance conforms to expected organizational standards and goals.
In controlling we compare actual performances with expected goals and see whether they give results or not.

Friday, January 15, 2010

Management is a science or an art?

Management is both science and art because when we study it, it is theory and science and when we apply it in an organization, then it is art and practical
Science of Management
Those who view management as science feel that organizational and managerial problem-solving requires the knowledge and application of scientific methods
Science is practical application of formulas, methods, statistics and books
Reading management is equal to science
Science is equal to knowledge
Art of ManagementThose who view management as an art feel that one gains expertise in the field of management only by practice
Art: is practical implementation of formulas, methods, statistics and the books
Art is equal to practical knowledge
Doing management is equal to art
Reading management is a science which is theory
Doing management is an art which is practical

Managerial Skills

Robert Katz identified three managerial skills that are essential to successful management
Conceptual skills: the ability to think about the future of an organization as a whole or the ability to think in the long run
Human skills: ability to interact or coordinate effectively with people
Technical skills: involves process or techniques of knowledge and proficiency
Distributed skills to different levels of management
Top management Higher conceptual skills, equal human skills and lower technical skills
Middle managementConceptual skill is less than top management and higher than lower management with equal human skills and higher technical skills than top management and lower technical skills than lower management
Lower management Lower conceptual skills, equal human skills and most technical skills

Levels of Management

There are three Managerial Levels which are described as follows :
Top level management: Ultimately responsible for the entire organization. Work with managers in implementing the planning, and control over organization
Like: President, CEO (Chief Executive Officer), VP (Vice President), CFO (Chief Financial officer), COO (Chief Operating Officer), CTO (Chief Technical Officer), MD (Managing Director
Top level managers have the responsibilities of making long-term plans, establishing policies, representing the company and also some other activities
Middle level Management: Directly responsible for their own activities and for the work of lower level managers
Like: Sr. PM (Senior Programmer), PM (Program Manager), Marketing Manager, Sales Manager
Middle level managers have the responsibilities of implementing goals, making decisions, directing first-line managers
Lower/First level management: Operate at the lowest hierarchical level and they are responsible for day-to-day operations
Like: Office manager, Supervisor, Foreman, Department head
Lower level managers have the responsibilities of implementing plans, overseeing workers, assisting middle managers

Manager, Organizational Performance and benefits of studying Management

Why do we study management?We are faced with managing our daily activities everyday but still you might have this question in your mind that why we study management and what is the need for it
So we have come up with some of the ideas as to why we study management
They are as follows
Proper management directly impacts improvements in the well-being of a society
Helps people to accomplish managerial goals
Studying management helps people to understand what management is and prepares them accomplish managerial activities in their organization
Studying management opens a path to a well-paying job and a satisfying career

ManagersManagers are the people responsible for supervising the use of an organization's resources to meet its goals

The following resources are organizational assetsPeople
Raw Materials
Financial Capital

Organizational PerformanceA measure of how efficiently and effectively managers are using organizational resources to satisfy customers and achieve goals
EfficiencyEfficiency means to do the things right
Efficiency is achieving goals and objectives of an organization with least amount of money , time and energy
Efficiency is a measure of how well or productively resources are used to achieve a goal
Effectiveness means to get the right things done
Effectiveness is a measure of the appropriateness of the goals an organization is pursuing and the degree to which they are achieved


Before coming to management introduction, we have to learn and know about the following issues and terms
SystemA system is one which has interrelated parts and functions as a whole
Types of systemsIn general, system is classified into open and close system
Close systemClose system is closed in relation to their external environment. Relation is totally closed, no interaction with media
Open systemOpen system has relationship and interaction with its external environment. Whatever is negative in close system is positive here
System frameworkIt means how an organization works by beginning with inputs and ending with impact
Input: the initial items we need to run a project are called inputs
Process: bringing inputs in processing. Starting phase of a project is called process
Output: is the result
Outcome: further checking of output is called outcome
Impact: after outcome, there is impact
We have two types of impact; direct and indirect impact
For example: building a university has direct impact on students and indirect impact on the people
Two or more persons engaged in a systematic effort to produce goods or services
Three common characteristics of an organization (it means without these three characteristics we can not form an organization) are as follows
PeopleOrganizations are made up of people. Making a goal into reality entirely depends on people’s decisions and activities in the organization. Without people you can not form an organization or achieve goals
PurposeEvery organization has different purposes, which is typically expressed in terms of goal or set of goals
Structure: (Organizational structure/chart)
All organizations develop a systematic structure that defines and limits the behavior of its members/employees
Definition of behaviorEvery structure must show that who is responsible for what
Limitation of behaviorEvery structure must show that who has the authority to do what

Definition of Management

Management is the process of achieving goals and objectives effectively and efficiently by using management functions such as POLCA (Planning, Organizing, Leadership, Controlling and Assurance).
Some would define management as an art, while others would define it as a science. Whether management is an art or a science isn't what is most important. Management is a process that is used to accomplish organizational goals; that is, a process that is used to achieve what an organization wants to achieve. An organization could be a business, a school, a city, a group of volunteers, or any governmental entity. Managers are the people to whom this management task is assigned, and it is generally thought that they achieve the desired goals through the key functions of (1) planning, (2) organizing, (3) directing, and (4) controlling. Some would include leading as a managing function, but for the purposes of this discussion, leading is included as a part of directing.
The four key functions of management are applied throughout an organization regardless of whether it is a business, a government agency, or a church group. In a business, which will be the focus here, many different activities take place. For example, in a retail store there are people who buy merchandise to sell, people to sell the merchandise, people who prepare the merchandise for display, people who are responsible for advertising and promotion, people who do the accounting work, people who hire and train employees, and several other types of workers. There might be one manager for the entire store, but there are other managers at different levels who are more directly responsible for the people who perform all the other jobs. At each level of management, the four key functions of planning, organizing, directing, and controlling are included. The emphasis changes with each different level of manager, as will be explained later.
Planning Planning in any organization occurs in different ways and at all levels. A top-level manager, say the manager of a manufacturing plant, plans for different events than does a manager who supervises, say, a group of workers who are responsible for assembling modular homes on an assembly line. The plant manager must be concerned with the overall operations of the plant, while the assembly-line manager or supervisor is only responsible for the line that he or she oversees.
Planning could include setting organizational goals. This is usually done by higher-level managers in an organization. As a part of the planning process, the manager then develops strategies for achieving the goals of the organization. In order to implement the strategies, resources will be needed and must be acquired. The planners must also then determine the standards, or levels of quality, that need to be met in completing the tasks.
In general, planning can be strategic planning, tactical planning, or contingency planning. Strategic planning is long-range planning that is normally completed by top-level managers in an organization. Examples of strategic decisions managers make are who the customer or clientele should be, what products or services should be sold, and where the products and services should be sold.
Short-range or tactical planning is done for the benefit of lower-level managers, since it is the process of developing very detailed strategies about what needs to be done, who should do it, and how it should be done. To return to the previous example of assembling modular homes, as the home is nearing construction on the floor of the plant, plans must be made for the best way to move it through the plant so that each worker can complete assigned tasks in the most efficient manner. These plans can best be developed and implemented by the line managers who oversee the production process rather than managers who sit in an office and plan for the overall operation of the company. The tactical plans fit into the strategic plans and are necessary to implement the strategic plans.
Contingency planning allows for alternative courses of action when the primary plans that have been developed don't achieve the goals of the organization. In today's economic environment, plans may need to be changed very rapidly. Continuing with the example of building modular homes in the plant, what if the plant is using a nearby supplier for all the lumber used in the framing of the homes and the supplier has a major warehouse fire and loses its entire inventory of framing lumber. Contingency plans would make it possible for the modular home builder to continue construction by going to another supplier for the same lumber that it can no longer get from its former supplier.
Organizing: Organizing refers to the way the organization allocates resources, assigns tasks, and goes about accomplishing its goals. In the process of organizing, managers arrange a framework that links all workers, tasks, and resources together so the organizational goals can be achieved. The framework is called organizational structure, which is discussed extensively in another article. Organizational structure is shown by an organizational chart, also discussed extensively in another article. The organizational chart that depicts the structure of the organization shows positions in the organization, usually beginning with the top-level manager (normally the president) at the top of the chart. Other managers are shown below the president.
There are many ways to structure an organization, which are discussed extensively in the articles referred to previously. It is important to note that the choice of structure is important for the type of organization, its clientele, and the products or services it provides—all which influence the goals of the organization.
Directing (leadership) Directing is the process that many people would most relate to managing. It is supervising, or leading workers to accomplish the goals of the organization. In many organizations, directing involves making assignments, assisting workers to carry out assignments, interpreting organizational policies, and informing workers of how well they are performing. To effectively carry out this function, managers must have leadership skills in order to get workers to perform effectively.
Some managers direct by empowering workers. This means that the manager doesn't stand like a taskmaster over the workers barking out orders and correcting mistakes. Empowered workers usually work in teams and are given the authority to make decisions about what plans will be carried out and how. Empowered workers have the support of managers who will assist them to make sure the goals of the organization are being met. It is generally thought that workers who are involved with the decision-making process feel more of a sense of ownership in their work, take more pride in their work, and are better performers on the job.
By the very nature of directing, it should be obvious that the manager must find a way to get workers to perform their jobs. There are many different ways managers can do this in addition to empowerment, and there are many theories about the best way to get workers to perform effectively and efficiently. Management theories and motivation are important topics and are discussed in detail in other articles.
Controlling The controlling function involves the evaluation activities that managers must perform. It is the process of determining if the company's goals and objectives are being met. This process also includes correcting situations in which the goals and objectives are not being met. There are several activities that are a part of the controlling function.
Managers must first set standards of performance for workers. These standards are levels of performance that should be met. For example, in the modular home assembly process, the standard might be to have a home completed in eight working days as it moves through the construction line. This is a standard that must then be communicated to managers who are supervising workers, and then to the workers so they know what is expected of them.
After the standards have been set and communicated, it is the manager's responsibility to monitor performance to see that the standards are being met. If the manager watches the homes move through the construction process and sees that it takes ten days, something must be done about it. The standards that have been set are not being met. In this example, it should be relatively easy for managers to determine where the delays are occurring. Once the problems are analyzed and compared to expectations, then something must be done to correct the results. Normally, the managers would take corrective action by working with the employees who were causing the delays. There could be many reasons for the delays. Perhaps it isn't the fault of the workers but instead is due to inadequate equipment or an insufficient number of workers. Whatever the problem, corrective action should be taken.
Managerial SkillsTo be an effective manager, it is necessary to possess many skills. Not all managers have all the skills that would make them the most effective manager. As technology advances and grows, the skills that are needed by managers are constantly changing. Different levels of management in the organizational structure also require different types of management skills. Generally, however, managers need to have communication skills, human skills, computer skills, time-management skills, and technical skills.
Communication Skills Communication skills fall into the broad categories of oral and written skills, both of which managers use in many different ways. It is necessary for a manager to orally explain processes and give direction to workers. It is also necessary for managers to give verbal praise to workers. Managers are also expected to conduct meetings and give talks to groups of people.
An important part of the oral communication process is listening. Managers are expected to listen to their supervisors and to their workers. A manager must hear recommendations and complaints on a regular basis and must be willing to follow through on what is heard. A manager who doesn't listen is not a good communicator.
Managers are also expected to write reports, letters, memos, and policy statements. All of these must be written in such a way that the recipient can interpret and understand what is being said. This means that managers must write clearly and concisely. Good writing requires good grammar and composition skills. This is something that can be learned by those aspiring to a management position.
Human Skills Relating to other people is vital in order to be a good manager. Workers come in about every temperament that can be imagined. It takes a manager with the right human skills to manage this variety of workers effectively. Diversity in the workplace is commonplace. The manager must understand different personality types and cultures to be able to supervise these workers. Human skills cannot be learned in a classroom; they are best learned by working with people. Gaining an understanding of personality types can be learned from books, but practice in dealing with diverse groups is the most meaningful preparation.
Computer Skills Technology changes so rapidly it is often difficult to keep up with the changes. It is necessary for managers to have computer skills in order to keep up with these rapid changes. Many of the processes that occur in offices, manufacturing plants, warehouses, and other work environments depend on computers and thus necessitate managers and workers who can skillfully use the technology. Although computers can cause headaches, at the same time they have simplified many of the tasks that are performed in the workplace.
Time-Management Skills Because the typical manager is a very busy person, it is important that time be managed effectively. This requires an understanding of how to allocate time to different projects and activities. A manager's time is often interrupted by telephone calls, problems with workers, meetings, others who just want to visit, and other seemingly uncontrollable factors. It is up to the manager to learn how to manage time so that work can be completed most efficiently. Good time-management skills can be learned, but managers must be willing to prioritize activities, delegate, deal with interruptions, organize work, and perform other acts that will make them better managers.
Technical Skills Different from computer skills, technical skills are more closely related to the tasks that are performed by workers. A manager must know what the workers who are being supervised are doing on their jobs or assistance cannot be provided to them. For example, a manager who is supervising accountants needs to know the accounting processes; a manager who is supervising a machinist must know how to operate the equipment; and a manager who supervises the construction of a home must know the sequence of operations and how to perform them