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Chapter 19 Management functions
Management • Management is generic. Management principles are general rather than specific to a type of firm or organization. However, management is universal only if the manager has become familiar with the specific situation in which it is applied. Production technology, customer characteristics and the culture of the industry are examples of specifics that managers need to learn to be effective in applying their generic management skills.
The definition of management • Management is creative problem solving. This creative problem solving is accomplished through four functions of management: planning, organizing, leading and controlling. The intended result is the use of an organization's resources in a way that accomplishes its mission and objectives. • This standard definition is modified to align more closely with our teaching objectives and to communicate more clearly the content of the organizing function. Organizing is divided into organizing and staffing so that the importance of staffing in small businesses receives emphasis along side organizing. In the management literature, directing and leading are used interchangeably.
Planning • Planning is the ongoing process of developing the business' mission and objectives and determining how they will be accomplished. Planning includes both the broadest view of the organization, e.g., its mission, and the narrowest, e.g., a tactic for accomplishing a specific goal.
Organizing • Organizing is establishing the internal organizational structure of the organization. The focus is on division, coordination, and control of tasks and the flow of information within the organization. It is in this function that managers distribute authority to job holders.
Staffing • Staffing is filling and keeping filled with qualified people all positions in the business. Recruiting, hiring, training, evaluating and compensating are the specific activities included in the function. In the family business, staffing includes all paid and unpaid positions held by family members including the owner/operators.
Directing • Directing is influencing people's behavior through motivation, communication, group dynamics, leadership and discipline. The purpose of directing is to channel the behavior of all personnel to accomplish the organization's mission and objectives while simultaneously helping them accomplish their own career objectives.
Controlling • Controlling is a four-step process of establishing performance standards based on the firm's objectives, measuring and reporting actual performance, comparing the two, and taking corrective or preventive action as necessary. • Each of these functions involves creative problem solving. Creative problem solving is broader than problem finding, choice making or decision making. It extends from analysis of the environment within which the business is functioning to evaluation of the outcomes from the alternative implemented.
Conceptual Skills • Conceptual skill is the cognitive ability to see the organization as a whole and the relationship among its parts. Conceptual skill involves the manager’s thinking, information processing, and planning abilities. It involves knowing where one’s department fits into the total organization and how the organization fits into the industry, the community, and the broader business and social environment. • As managers move up the hierarchy, they must develop conceptual skills or their promo ability will be limited. A senior engineering manager who is mired in technical matters rather than thinking strategically will not perform well at the top of the organization.
Human skills • Human skill is the manager’s ability to work with and through other people and to work effectively as a group member. This skill is demonstrated in the way a manager relates to other people, including the ability to motivate, facilitate, coordinate, lead, communicate, and resolve conflicts. A manager with human skills allows subordinates to express themselves without fear of ridicule and encourages participation.
Technical skills • Technical skill is the understanding of and proficiency in the performance of specific tasks. Technical skill includes mastery of the methods, techniques, and equipment involved in specific functions such as engineering, manufacturing, or finance. Technical skill also includes specialized knowledge, analytical ability, and the competent use of tools and techniques to solve problems in that specific discipline. Technical skills are particularly important at lower organizational levels.
Manager roles • A role is a set of expectations for a manager’s behavior. These roles are divided into three conceptual categories: informational; interpersonal; and decisional. Each role represents activities that managers undertake to ultimately accomplish the functions of planning, organizing, leading, and controlling. Although it is necessary to separate the components of the manager’s job to understand the different roles and activities of a manager, it is important to remember that the real job of management cannot be practiced as a set of independent parts; all the roles interact in the real world of management.
Informational roles • Informational roles describe the activities used to maintain and develop an information network. General managers spend about 75 percent of their time talking to other people. The manager acquires information from others and scans written materials to stay well informed.
Interpersonal roles • Interpersonal roles pertain to relationships with others and are related to the human skills. The manager represents the organization in his or her formal managerial capacity as the head of the unit.
Decisional roles • Decisional roles pertain to those events about which the manager must make a choice and take action. These roles often require conceptual as well as human skills. Managers are constantly thinking about the future and how to get there. Managers become aware of problems and search for innovations that will correct them.
