MGT 3200 Lecture : Introduction To Management Notes Mat
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MGT 3200 (CHAPTER 1)
INVITATION TO MANAGEMENT
I. WHAT IS MANAGEMENT?
Management is catholic. In other words, it is universal. It’s everywhere. We talk about
managing on the job; managing the home; managing the family budget; managing one’s
career; etc. Management, however, is a relatively young field and as such, many of its
terms and concepts have yet to be standardized. In terms of defining what management
is, there is no single, universally accepted definition. But for our purposes, we will
define management as the process of achieving desired results through the efficient
utilization of human and material resources (Bedeian, 1993).
The above definition of management points out two key concerns in managing others: 1)
effectiveness and 2) efficiency. Effectiveness is concerned with doing the right thing at
the right time in the right way. In other words, it’s concerned with goal attainment.
Efficiency, on the other hand, is concerned with reducing waste or minimizing resource
costs since many resources are scarce (i.e., money, good people, equipment). That is, it’s
concerned with getting more bang for the buck such as increasing outputs while
maintaining the same level of inputs or keeping the same level of outputs while
decreasing the level of inputs. So, effectiveness is concerned with the ENDS and
efficiency is concerned with the MEANS to those ends.
These two goals are related in that it’s much easier to be effective if one disregards
efficiency. For example, Seiko could produce more accurate and attractive timepieces if
it disregarded labor costs and material input costs. Conversely, it becomes increasingly
more difficult to be effective when one becomes more and more concerned with
efficiency. For example, a state university will find it very difficult to give its students a
high quality education if it has a shoe-string budget.
Just because organizations are efficient does not necessarily make them effective.
Sometimes organizations can do the wrong things well! However, high efficiency is
more typically associated with high effectiveness than with low effectiveness. Poor
management is most often due to both ineffectiveness and inefficiency or effectiveness
achieved through inefficiency. The hallmark of good management is effectiveness
combined with efficiency. But remember out of the two: effectiveness is more critical.
The definition of management also points out another major fact concerning
management. That is, the only way a manager gets things accomplished in an
organization is through other people. A manager’s performance is contingent upon the
performance of people underneath him/her. As the old saying goes “you’re only as good
as the people underneath you.” Thus, as a manager, it’s your human resources that are
your most important resources. In fact, this is something that we need to learn from the
Japanese who put a premium on developing their human resources.
Management can also be considered a science. (You may hear it called a “bastard”
science since it borrows heavily from so many fields such as psychology, sociology,
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anthropology, and economics.) It is considered a science since we develop theories of
managing, test these theories empirically using the scientific method, and refine,
reformulate or discard these theories based upon the results of these studies.
Conversely, management, as practiced, is really an art form. For some, managing is
really just a natural extension of their personalities. It comes easy or natural to them.
One piece of evident that convinces this instructor that management is an art form is,
there are many roads to managerial success or many widely different styles of
management that can be successful. If the practice of management were a pure science, I
could give anyone a step-by-step formula and provided that person followed that formula
that person would become a managerial success. But in reality, this is simply not the
case.
II. HOW DID MANAGEMENT BECOME SIGNIFICANT AND WHY IS IT
STILL IMPORTANT TODAY?
With the advent of the Industrial Revolution in the late 18th Century the world of work
was revolutionized. Prior to the Industrial Revolution, goods were produced by highly
skilled craftsmen who through the use of simple tools produced an entire product from
beginning to end and sold this good directly to the consumer. The basic change that
occurred in the Industrial Revolution was the transfer of skills from the craftsmen to the
machines. During and after the Industrial Revolution, factories became common. In
these factories, there were unskilled laborers who simply fed the machines the raw
material, removed the finished material, and passed it on to the next unskilled laborer to
feed it into his machine. In other words, the labor was divided in these factories, the skill
level of the employee decreased as a result, and these employees and their efforts needed
to be supervised and coordinated to get the goods produced. Thus, you needed someone
to manage these workers. So, the Industrial Revolution brings about the advent of
management.
In the beginning of the Industrial Revolution, these factories were relatively small and the
owner was the manager. However, as result of the enormous increase in productivity
brought on by the addition of machinery and the division of labor to the transformation
process, prices dropped and consumption (demand) grew. Modern capitalism was born.
In order to keep up with this growing demand, factories had to become larger. This
growth in size presented a problem for the owner who no longer could manage all the
operations of the factory due to its increased size. As a result, the owner had to hire
people to help him manage. These were people who managed for a profession and did
not own the means of production. These people were professional managers. According
to Peter F. Drucker, the switch from owner/manager to professional manager is the
pivotal event of our time. So, the changes brought about by the Industrial Revolution
create the need for professional management. This is how professional management
became significant.
Why are managers still important today?
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Professional management is still important today because it’s the key to the efficient
accomplishment of organizational and societal objectives. On an organizational level,
while organizations fail for many reasons, poor management is cited most often as the
reason for business failure. Peter F. Drucker called management the lifeblood of every
organization. Likewise, on a societal level, management still persist today because we
need these organizations to provide the goods and services that we both want and need
and that the craftsmen could not make themselves.
III. THE MANAGEMENT PYRAMID
The management pyramid refers to the various levels of management within an
organization. There are three distinct but overlapping levels of management in a typical
organization, each having a different emphasis: first-line, middle, and top.
A) First-line managers: They are called, for example, supervisor or foreman. They are
usually the largest number of managers in an organization. Most people enter
management at this level. They are the first contact with labor or operative level
employees. In essence, they are the middle men caught labor and “management”. They
manage operating employees and resources. They are the only managers not to manage
other managers. Their primary objective is to ensure that plans developed by top
management are fulfilled by their operating employees (i.e., those people who actually
produce the basic product or service of the company). In recent years the power of the
first-line supervisor has been dramatically reduced due to unions and their grievance
procedures and to the passage of anti-discrimination laws such as the Civil Rights Act of
1964. In the case of the latter, employment the Equal Employment Opportunity
Commission who also publishes a set of guidelines on fair employment practices
carefully monitors practices.
B) Middle-managers: They are called plant manager, division head, etc. They manage
other managers. This is a testing ground from which many organizations fill top
management positions. There are two Is of middle management: integrator and
interpreter. One of their duties is to integrate (i.e. coordinate) the activities of different
work groups so they operate in harmony with one another and are better able to cope with
the demands made upon them. As for the latter I, they act as interpreters and transform
top management directives into first-line management. They are a communication
channel between different levels of management.
Due to the increased foreign and domestic competition, there has been an increasing
emphasis on corporate downsizing in American organizations. Corporate downsizing is
when a company adopts a “lean and mean” philosophy, an efficiency orientation.
Companies who are going through corporate downsizing are trying to cut the fat by
eliminating layers of management, asking retained managers/employees to do more,
implementing new computer and information technologies, and farming out what had
been staff managerial activities such as legal counsel and training and development of
employees to outside consulting firms. The result of this efficiency orientation has been
that many middle level management jobs have been eliminated altogether or have been
replaced by new information technologies or have been farmed out to outside consulting
