Management: Principles and Techniques

By Yashu Bansal, Chanakya National Law University, Patna

Editor’s Note: This paper deals with the concept of management. It traces the evolution of trends of management. The paper analyses the development of administrative management with the industrial revolution through the contributions of Henri Fayol, Max Weber etc. It then goes on to study the development of scientific techniques of management by analyzing the contribution of Taylor and Emerson.”

Introduction

Management is the process of reaching organizational goals by working with and through people and other organizational resources. It is a process or series of continuing and related activities. It involves and concentrates on reaching organizational goals. It is the art of getting things done through others. Management means leadership. It reaches these goals by working with and through people and other organizational resources. Management can be an art as well as a science. It is based both on principles and observations. With the changing time, management has also become a profession. Management is a science since it is based on principles and observations. It has clear boundaries of application so that the theory is not used in situations for which it was never intended. Management is an art since it requires practice. With years and years of practice and experience, people become excellent managers. Therefore it is an art which cannot be learned by reading books. Lastly, management is a profession since it is being taught in various institutions across the globe.

What we consider to be a skill developed in the modern era by the developed mind has actually been in use even thousands of years back. Management has definitely gained great importance and skill in this age of modernization but it had evolved even before the Egyptian times. Though it is a relatively new field of academic interest, it has its foundation laid in the history of the world. Even today, there are many old practices followed in today’s principles of efficient management. It is true that every technique of today’s generation has evolved from the history and this is also the truth that many practices of the earlier times are followed even today. The great skills of management can be seen in the building of the Pyramids as well in the battles of the earlier times. With the passing of years, management is facing great changes. Its tools and techniques, principles and application are altering as per the comfort of the man and the benefit of the society.

Ancient Management

Management has developed and grown in leaps and bounds from a nearly insignificant topic in the previous centuries, to one of the integral ones of our age and economy. Management has evolved into a powerful and innovative force on which our society depends for material support and national well-being. The period between 1700 and 1850 is highlighted by the industrial revolution and the writings of the classical economists. The advent of the factory system during this period highlighted, for the first time, the importance of direction as a managerial function. As factories and jobs increased and a distinctive work culture began to take shape, appropriate management of all this became imperative. This development brought along with it new questions and problems to which adequate solutions were required. To find appropriate solutions to these problems, people began to recognize management as a separate field of study. In recent times, management has become a more scientific discipline having certain standardized principles and practices. The following is a breakdown of the evolution of management thought during its developmental period:

Early management approaches which are represented by scientific management, the administrative management theory and the human relations movement.

Modern management approaches which are represented by scientific management, the administrative/management science approach, the systems approach and the contingency approach.

Management has existed in some form for thousands of years. After all anything that requires an approach where humans organize effectively to a plan and achieve specific objectives can be loosely defined as a project. How else would have humans achieved some of stunning wonders and achievements? The History of Project Management is the history of mega projects of the last 4,500 years that include the Giza Pyramid, the Parthenon, the Colosseum, the Gothic Cathedrals of Europe, the Taj Mahal, and the Transcontinental Railway. These were not anomalies in history but projects delivered in a systematic way with very similar characteristics to today’s projects. Typically, they had a project charter, a business justification, and a project sponsor. In close analysis they also followed a similar life-cycle of phases that we use today.

For most people the starting point in the History of Management is the Great Pyramid at Giza, a monumental structure for its time, 2550 B.C.E. The project conjures up images of thousands of slaves serving a merciless pharaoh and toiling in inhospitable conditions. Yet in reality labour was not an inexhaustible supply but came at a higher price. From modern research there is little evidence to suggest the use of slave labour, only in the Great Wall of China project (221 B.C.E. – 206 B.C.E.) was peasant labour used. Giza’s project workforce lived on a middle-class diet of meat. Giza was built in 20 years and the astounding accuracy of measurements, the level base, and the precision with which 40 to 60 ton blocks were laid, stuns engineers today.

Turning back the pages of the history, we will see that in the book, The Art of War, written by Sun Tzu, a Chinese philosopher, he has given the best guidelines for military leaders, 2000 years back. His principles were:

  • When the enemy advances, we retreat!
  • When the enemy halts, we harass!
  • When the enemy seeks to avoid battle, we attack!
  • When the enemy retreads, we pursue!

An Italian, Niccolo Machiavelli had written down the work, The Prince. He gave the four main principles of management, which are relevant even today. Mass content, strive for cohesiveness, will to survive and set an example were his four main principles of management.

The growth of industrialization is usually attributed to two individuals- James Watt and Adam Smith. In 1781, Watt made a breakthrough in technology by developing an engine with a rotary, as opposed to an up and down movement. This made the technology more adaptable to factory use. Adam Smith in 1776 popularized the principle of division of labour. Likewise, management evolved, taking different forms and aspects.

Evolution of Administrative Management

Administrative management focused on the development of broad administrative principles applicable to general and higher managerial levels. There were many purists who gave their views on the evolution of management. Some of the major theories were given by:

Henri Fayol (1841-1925)

Henri Fayol was a mining engineer and a successful manager. Fayol’s work became more generally known with the 1949 publication of ‘General and industrial administration’, the English translation of the 1916 article “Administration industrielle et générale”. In this work, Fayol presented his theory of management, known as Fayolism. Before that Fayol had written several articles on mining engineering, starting in the 1870s, and some preliminary papers on administration. For him, a manager should possess skills. All activities happening in an organization can be divided into six groups:

  • Technical
  • Commercial
  • Financial
  • Security
  • Accounting
  • Managerial

He was the man who thought that there were five basic functions of administration: planning, organizing, commanding, coordinating and controlling. Planning is the formulation of objectives and deciding the course of action. Organizing is the effective coordination of resources for accomplishing the pre-determined objectives. Commanding is the art of effective leadership. Coordinating entailed the unity of group efforts to provide unity of action, ensured the harmony necessary for the smooth functioning of the organization. Controlling is identifying any deviations from the adopted plans. Fayol also set forth the fourteen principles of administration. These principles played a great role in the evolution of management. They are as follows:

Division of Work: This principle of Fayol tells us that as far as possible the whole work should be divided into different parts and each individual should be assigned only one part of the work according to his ability and taste rather than giving the whole work to one person. When a particular individual performs the same job repeatedly, he will become an expert in doing that particular part of the whole job. Consequently, the benefits of specialization will become available.

Authority and Responsibility: According to this principle, authority and responsibility should go hand in hand. It means that when a particular individual is given a particular work and he is made responsible for the results, this can be possible only when he is given sufficient authority to discharge his responsibility.

Discipline: Discipline is essential for any successful work performance. Fayol considers discipline to mean obedience, respect for authority, and observance of established rules. Discipline can be established by providing good supervision at all levels, clearly explaining the rules, and implementing a system of reward and punishment. A manager can present a good example to his subordinates by disciplining himself.

Unity of Command: According to the principle of unity of command, an individual employee should receive orders from only one superior at a time and that employee should be answerable only to that superior. If there are many superiors giving orders to the same employee, he will not be able to decide as to which order is to be given priority. He thus finds himself in a confused situation

Unity of Direction: Unity of direction means that there should be one head for one plan for a group of activities having the same objective. In other words, there should be one plan of action for a group of activities having the same objective and there should be one manager to control them.

Subordination of Individual Interest to General Interest: According to this principle, the general interest or the interest of the organization is above everything. If one is asked to place individual interest and the general interest in order of priority, definitely the general interest will be placed at the first place.

Remuneration to Employees: Employees should get a fair remuneration so that the employees and the owners find equal amount of satisfaction. It is the duty of the manager to ensure that employees are being paid remuneration according to their work. If, however, they are not paid properly for their work, they will not do their work with perfect dedication, honesty and capacity.

Centralization and Decentralization: According to this principle, the superiors should adopt effective centralization instead of complete centralization and complete decentralization. By effective centralization, Fayol does not mean that authority should be completely centralized.

Scalar Chain: It refers to a formal line of authority which moves from highest to the lowest ranks in a straight line. This chain must be followed in a strict manner. It means each communication must move from top to bottom and vice-versa in a straight line. The important condition here is that no step should be overlooked during communication.

Order: According to the principle of order, a right person should be placed at the right place.

Equity: This principle tells that the managers should treat their subordinates in a just and kind manner so that they develop a feeling of dedication and attachment for their work. All the employees should be treated equally and impartially.

Stability of Personnel: From the point of view of management it is absolutely harmful to change the employees frequently as it is a reflection of inefficient management. Therefore, according to this principle there should be stability of tenure of the employees so that the work continues efficiently.

Initiative: Initiative means the capacity to work while expressing one’s thoughts. According to Fayol, it is the duty of the manager to encourage the feeling of initiative among his employees for doing some work or taking some decision but within the limits of authority and discipline.

Esprit de corps: As per this principle, a manager should continuously make efforts to develop a team spirit among the subordinates. To do this, he/she should use the word ‘We’ instead of” during the conversation with subordinates.

Max Weber(1864-1920)

He was a German sociologist. He defined an ideal organization as one which has clear division of labour, hierarchy of authority, formal selection and formal rules. He believed that an organization which has clearly defined authorities and responsibilities has the ideal atmosphere. He said that every organization should have hierarchy of authority and formal selection of its employees following the formal rules and regulations.

Chester Barnard (1886-1961)

A Bell telephone Executive, he developed theories about the functions of a manager. According to him, people came together in a formal organization to achieve ends whih they cannot accomplish on working alone. But while achieving the goals of the organization, an individual seeks to achieve his personal goals as well. He therefore concluded that for any organization to operate efficiently, its goals must be balanced with the goals of the individuals working for it. Barnard believed in an informal organization for the accomplishment of the goals of an organization. His recognition of the importance of ‘informal organization’ was a major contribution to the management thought.

James D. Mooney (1884-1957)

He was a General Motor executive. He strongly believed that coordination was the first principle of organizing. He also said about functional distinction.

These were the purists who brought about a revolutionary change in the thought of management in the administrative field, the field of application. Their efforts and contributions did wonders and they will forever be credited for their works.

Evolution In The Scientific Field

Scientific management was a system that investigated and developed ways of increasing the output by determining the best way to solve operating problems. There were many purists who gave their theories for the evolution of management in the scientific field.

Charles Babbage (1792-1871)

He was an English mathematician who was concerned about developing the the efficiencies of labour production. He propagated specialization and division of labour. He believed that managers who increase the standards of their performances with regard to time should be rewarded. This was his belief.

Fredrick Winslow Taylor (1856-1915)

He is known as the Father of Scientific Management. He worked in a shop where he picked up the trades of a pattern maker and machinist. He gave four basic principles of management. They were:

Taylor’s four principles are as follows:

  • Replace working by “rule of thumb,” or simple habit and common sense, and instead use the scientific method to study work and determine the most efficient way to perform specific tasks.
  • Rather than simply assign workers to just any job, match workers to their jobs based on capability and motivation, and train them to work at maximum efficiency.
  • Monitor worker performance, and provide instructions and supervision to ensure that they’re using the most efficient ways of working.
  • Allocate the work between managers and workers so that the managers spend their time planning and training, allowing the workers to perform their tasks efficiently.

H.L. Gantt (1861-1919)

He was a consulting engineer who specialized in control systems to stop scheduling. He saw the importance of the human element in productivity and introduced the concept of motivation as used in industry today. He believed that industrial efficiency can only be produced by the application of scientific analysis to all aspects of the work in progress. The industrial management role is to improve the system by eliminating chance and accidents. In the Task and Bonus System, he linked the bonus paid to managers to how well they taught their employees to improve performance. He believed that businesses have obligations to the welfare of the society in which they operate. Gantt also came up with Gantt chart. A Gantt chart is constructed with a horizontal axis representing the total time span of the project, broken down into increments (for example, days, weeks, or months) and a vertical axis representing the tasks that make up the project (for example, if the project is outfitting your computer with new software, the major tasks involved might be: conduct research, choose software, install software). Horizontal bars of varying lengths represent the sequences, timing, and time span for each task. Using the same example, you would put “conduct research” at the top of the vertical axis and draw a bar on the graph that represents the amount of time you expect to spend on the research, and then enter the other tasks below the first one and representative bars at the points in time when you expect to undertake them. The bar spans may overlap, as, for example, you may conduct research and choose software during the same time span. As the project progresses, secondary bars, arrowheads, or darkened bars may be added to indicate completed tasks, or the portions of tasks that have been completed. A vertical line is used to represent the report date.

Gantt charts give a clear illustration of project status, but one problem with them is that they don’t indicate task dependencies – you cannot tell how one task falling behind schedule affects other tasks. The PERT chart, another popular project management charting method, is designed to do this. Automated Gantt charts store more information about tasks, such as the individuals assigned to specific tasks, and notes about the procedures. They also offer the benefit of being easy to change, which is helpful. Charts may be adjusted frequently to reflect the actual status of project tasks as, almost inevitably; they diverge from the original plan.

Emerson (1853-1931)

He emphasized the importance of a correct organization and gave the following principles of efficiency:

  • A clearly defined ideal
  • Common sense
  • Competent counsel
  • Discipline
  • A fair deal
  • Reliable, immediate, adequate and permanent records
  • Standardized conditions and operations
  • Standards and schedules
  • Written standard practice instructions
  • Reward for efficiency
  • Dispatching

Contemporary Management Trends

The world of managers today is totally different from that which existed decades ago. Communities are increasingly heterogeneous, economies and communication are more accessible and global, connections between partnerships and organizations, public and private sectors, and policy arenas multiply, and members of the public are better able to scrutinize problems and search for better and improved performance. Scientific Management was developed in the first quarter of the 20th Century; its father is commonly accepted to be F.W. Taylor, although some variations of the theory have been developed by Gantt and Gilbreth. Through this study, Taylor could see that work was more efficient when broken down into its constituent parts, and the management, planning, and decision-making functions have been developed elsewhere. Taylor’s system insured the most efficient way would be used by all workers, therefore making the work process standard. Invariably managers found that maximal efficiency was achieved by a subdivision of labor. This subdivision entailed breaking the workers tasks into smaller and smaller parts; in short, specifying not only what is to be done but how it is to be done and the exact time allowed for doing it.

George Ritzer in his book ‘The McDonaldization of Society’ notes a similar philosophy in a McDonalds staff manual. It told the operators’ precise cooking times for all products and temperature settings for all equipment. It specified that French fries be cut at nine-thirty-seconds thick. Grill men were instructed to put hamburgers down on the grill moving left to right, creating six rows of six patties each. In many ways McDonalds is the archetypical example of an organization employing Scientific Management in production. Within this restaurant chain, uniformity is complete; no matter what country you are in every branch of McDonalds is the same, as are the methods used to prepare food, clean floors, promote staff and lock up on closing. It is this ability to efficiently supply standard food and service throughout the world that has allowed McDonalds to become the biggest restaurant chain on the planet. This is the best example to show how the practices are used even today.

The principles used then for administrative management are even used in today’s world. The principle of ‘division of work’ which had evolved in the ancient times proposed that work should be divided among the workers for faster outputs and work specialization. In today’s world we see that the employees are all hired for different departments of jobs. There are categories like human resources, economic analysis, financing and many more. Work has been divided well. The order of positions is followed very precisely today. We see that the worker has to communicate to the leader. He communicates to the manager and then the message goes upwards. The organizations prefer employees who are willing to work and take the initiative to work. The principle of equity is being fair to all the employees. This principle is followed even today. Wall Mart gives his entire employees share from the profit, incentives and bonuses. Even today, the bosses have more authority and thus more responsibility. The scalar chain is still followed in big organizations. All the ancient principles of management are followed even today. Though there are some principles which have lost their value and importance, they somehow help an organization to flourish.

Tata Consulting Services is one example of how the principles of management are used in today’s world and how the organization gains benefits from them. The company has more than 130,000 employees located in 42 countries and achieved revenues of $5.7 billion in fiscal 2008. Subramaniam Ramadorai, former CEO of TCS, has written an autobiographical book about his experiences in the company called “The TCS Story…and Beyond.” There are several other companies which use the old principles of management.

Therefore, even if management has become a global word now with many applications, rules and principles, it still has the essence of the decades old principles. These principles form the base of management. They are still used in many organizations and in different forms.

Conclusion

Management has existed in some form for thousands of years. After all anything that requires an approach where humans organize effectively to a plan and achieve specific objectives can be loosely defined as a project. How else would have humans achieved some of stunning wonders and achievements? The History of Project Management is the history of mega projects of the last 4,500 years that include the Giza Pyramid, the Parthenon, the Colosseum, the Gothic Cathedrals of Europe, the Taj Mahal, and the Transcontinental Railway. These were not anomalies in history but projects delivered in a systematic way with very similar characteristics to today’s world. Management is the process of reaching organizational goals by working with and through people and other organizational resources. It is a process or series of continuing and related activities. It involves and concentrates on reaching organizational goals. Management means decision making. It is the art of getting things done through others. Management means leadership. It reaches these goals by working with and through people and other organizational resources. Management can be an art as well as a science. It is based both on principles and observations. With the changing time, management has also become a profession.

In decades and decades, management has evolved to a great scale. Scientific management was a system that investigated and developed ways of increasing the output by determining the best way to solve operating problems. There were many purists like Taylor, Emerson and Gantt who gave their theories for the evolution of management in the scientific field. Administrative management focused on the development of broad administrative principles applicable to general and higher managerial levels. There were many purists like Fayol, Chester Barnard and Max Weber who gave their views on the evolution of management. Therefore, even if management has become a global word now with many applications, rules and principles, it still has the essence of the decades old principles. These principles form the base of management. They are still used in many organizations and in different forms. Though the world of managers today is totally different from that which existed decades ago, the ancient principles still exist.

Edited by Kudrat Agrawal

References

  • Gupta, meenakshi, Principles of Management, PHI Learning, 2012
  • Verma, A.P., Human Resource Management, S.K. Kataria and Sons, 2012
  • Koontz and Weihrich, Harold and Heinz, Essentials of management, Mc Graw Hill, 2013
  • Performance Appraisal Case Study, available at http://www.managementparadise.com/forums/human-resources-management-h-r/206371-case-study-performance-appraisal.html
  • Gantt Chart, available at http://www.gantt.com/
  • Tata Consultancy Services, available at http://www.tata.com/company/profile.aspx?sectid=YrxJG1Zt1BU=
  • Ancient Chinese theories of Control, available at http://people.stern.nyu.edu/wstarbuc/ChinCtrl.html’

One Reply to “Management: Principles and Techniques”

Leave a Reply

Your email address will not be published. Required fields are marked *