BUSINESS MANAGEMENT

1. BUSINESS MANAGEMENT CHAPTER 2 LEADERSHIP:STYLES AND THEORIES Acc. To Franklin G.Moore,”Leadership is the ability to make men act the way the leader wants.”

2. Followers Personal Ability Influencing process No need of coercion Full capability utilisation Ideal conduct Leadership is a continuing process Leadership is a part of management but not all of it Characteristics or Nature of Leadership

3. 9.Leadership is ever a new process 10.Leadership is something a person does, not something he has 11.Leadership transforms potential into reality 12.Leaders exist because of the need of the people to follow someone

4. Peter F.Drucker. ”A business leader is the basic and not easily available source of a business enterprise. The chief factor in the failure of many business enterprises has been inefficient leadership.” Acc. to Koontz and O’Donnell : Impact of leadership on employees’ utilization of capability: 1. Social Pressure 2. Need for a job 3.Authority of Superior A) Normal Expectancy: 1.Social Pressure 2.Need for a job 3.Authority of superior B) Expectancy Through Leaderhship: 1.Induced by Leadership. Importance of leadership

5. 1. Source of Motivation 2.Basis for Cooperation 3.Directing Group Activities 4.Promoting the Spirit of Coordination 5.Facility to the Executives 6.Fulfilling Social Responsibility 7.Basis for Success of Business

6. 1. To define Organisational Goals 2. To divide the Work as per Capability 3. To Guide the Activities 4. To Maintain Discipline 5. To Create Effective Communication 6. To Understand the Feelings if his Subordinates 7. To Secure Cooperation 8. To Represent the Organisation 9. To Make Decisions 10. To Design Environment as per Result Expectations Functions of a Leader

7. 1. Ability to Motivate 2. Ability to Communicate 3. Quick Decision-making Power 4. Integrity 5. Full of Courage 6. Self-confidence 7. Flexibility of Mind 8. Ability to Understand the Feelings of Others 9. Sense of Responsibility 10. Tolerance 11. Alertness 12. Technical Ability 13. Psychological Expert 14. Human Ability 15.Physical and Mental Fitness Qualities of a Leader

8. THE TRAIT THEORY- Bernard and Ordway Teed Leadership ability is inborn and it cannot be achieved by making any effort Acc. To Stogdill- 40 qualities divided into 5 parts Physical traits Intelligence and ability traits Personality traits Task related traits Social traits THEORIES OF LEADERSHIP

9. CRITICISM- Lack of uniformity Ignorance about situations Unclarity about the degree Problem of measuring the traits

10. 2. THE SITUATION THEORY- CRITICISM- Whether a leader will be successful in all situations. What qualities required in different situations

11. 3.THE FOLLOWERS THEORY- CRITICISM- Followers alone does not determine the leadership ability

12. 4.BEHAVIOURAL THEORY- Acc to Ray A Killian- a leader should present an ideal behaviour before his followers. Factors creating behaviour- Level of qualities of a leader Followers’ faith Nature of goals Available environment CRITICISM- time an important factor was ignored

13. 5.GROUP APPROACH THEORY- BY Kurt Lewin leader should adopt the norms of the group 6.X AND Y THEORY- By Mc Gregor 7.PATH GOAL THEORY- based on expectancy model of motivation. Motivation=valence x expectancy valence= all round development of employees Expectancy=preparing the way for the attainment of the goals

14. MOTIVATIONAL STYLE- POSITIVE STYLE- by economic and non economic incentives. NEGATIVE STYLE-by coercion and fear. 2.POWER BASED STYLE- AUTOCRATIC STYLE- CHARACTERISTICS: a)Formal relations, b)centralised authority, c)single man decisions, d)negative motivation, e)wrong belief regarding employees, f)employees’ behaviour, g)only downward communication, h)tight and close supervision and control. LEADERSHIP STYLES

15. ADVANTAGES- a)quick and clear decisions, b)satisfactory work, c)necessary for less educated employees, d)source of motivation for employees. DISADVANTAGES-a)lack of motivation, b)less productivity, c)agitation by employees, d)possibility of partiality.

16. ii.DEMOCRATIC STYLE- CHARACTERISTICS: a)cooperative relations, b)positive motivation,c)belief in employees, d)open communication, e)group decision making, f)cooperative behaviour among employees, g)no need of tight control. ADVANTAGES: a)high morale, b)creation of more efficiency and productivity, c)peaceful industrial relations, d)quick acceptance of changes, e)availability of sufficient time for constructive work.

17. DISADVANTAGES- a)requirement of educated subordinates, b)delay in decisions, c)lack of responsibility in managers, d)many types of employees. iii.FREE-REIN STYLE- CHARACTERISTICS: a)full faith in subordinates, b)independent decision making system, c)decentralisation of authority, d)cooperative relations, e)motivation through authority, f)two way communication, g)self directed, supervisory and controlled, h)sense of responsibility in employees

18. ADVANTAGES-1)Devlpt of self confidence in subordinates, 2)high level motivation, 3)helpful in devplt and extension of the enterprise. DISADVANTAGES-1)difficulty in cooperation, 2)lack of importance of managerial post, 3)suitable only for highly educated employees.

19. 3. RESULT BASED STYLE- I.EMPLOYEE ORIENTED STYLE: human behaviour is required. *not suitable where employees are careless. The manager should have be a psychologist. ii.PRODUCTION ORIENTED STYLE: production more stressed. *not suitable in the long run.

20. Nature of leader Nature of followers Size of the organisation Situations of work Determinants of leadership style

21. A blend of different leadership styles is called continuum of leadership behaviour given by Robert Tannenbaum and Warren H.Schmidt. Leadership as a continuum

22. A leader take decision and announce it A leader tells his decision A leader presents ideas and invites questions A leader presents a tentative decision subject to change A leader invites ideas before taking a final decision A leader defines the limits within which the subordinates take decisions A leader permits the group to take decision acc. To the situation.

23. Rensis Likert- worked at the Michigan University, U.S.A. Included 7 variables in his research- Leadership Motivation Communication Interactive influence Decision making process Goal setting Control process Management system of likert

24. Four models- Exploitative authoritative: system 1 Benevolent authoritative:system 2 Consultative: system 3 Participative: system 4 Test of management systems- Productivity Employees’ turnover rate Employees’absenteeism rate Quality control Wastage of resources Wastage of scrap

25. Allen- poorly motivated people can nullify the soundest organisation. Motive means the hidden will power in an individual which impels or encourages him to work. Acc. To Koontz and O’Donnell- To motivate is to induce people people to act in a desired manner. CHAPTER 3MOTIVATION: nature and theories

26. Characteristics or nature of motivation- Motivation is an internal feeling Motivation is a continuous process Each person has different motivational factors Motivation may be given in many ways It’s an important function of management It stimulates people to do work It help in securing industrial peace It creates morale It is the only solution to the problem It relates with all levels of organisation It relates with human factor of production

27. Renis Likert- The core of management. High level of performance Low employees turnover & absenteeism Easy acceptance of organisational changes Sweet relations between owner & employees Good image of organisation Increase in morale Proper use of human resources possible Helpful in achieving goals Builds good relations among employees Advantages or importance of motivation

28. Robbins & Coulter- need- satisfying process Unsatisfied need Tension Drives Search behaviour Need satisfied Reduction of tension Motivation process

30. Physiological needs Safety needs Social needs Esteem & status needs Self actualisation needs Assumptions- a)people’s behaviour is affected by their needs, b)there are many needs of people and they can be arranged in an order, c)motivation ends with the satisfaction of needs,d)people move to next need only when the lower need is satisfied. Criticism-a)the hierarchy of needs is not permanent, b)not necessary that only one need is strong at a time. Maslow’s need hierarchy theory

31. A)Maintenance or Hygiene or Dissatisfiers- 1.company’s policy & administration 2.technical Inspection 3.mutual personal relation with inspector 4.mutual relation with other team members 5.salary 6.working conditions 7.personal life 8.security of employment 9.status 10.environment. B)Motivators or satisfiers- 1.achievement 2.recognition 3.advancement 4.job itself 5.opportunities for growth 6.resposibility Criticism- the classification is not practical. Herzberg,s motivation-hygiene theory

32. Theory X Man by nature is sluggish and shirker Mostly people are not ambitious and don’t want to take resposibility People want to be directed Only physical and security needs motivate Strict control,threat and punishment are used to get the work done. Theory Y Man wants to work in favourable conditions People are enthusiastic, responsible & full of effort People are self directed Physical & security needs motivate for short run only McGregor’s X & Y theory

33. Features of Japanese Management System- Planning- a)more attention to long term objectives b)subordinates are given importance in decision making c)no hasty decisions are taken d)quick decision implementation. Organizing- a)collective responsibility b)informal organizing c)changes with collective consultation d) internal change agents are used to implement change. Ouchi’s Z Theory

34. 3) Staffing- a) recruitment through technical institutions b)employment for the whole life c)change of company by the employees is almost non existent d)slow promotion e)long term performance appraisal f)training is considered as long term investment g)arising spirit of dedication amongst employees. 4) Directing- a)a leader is like a helper b) effort to reduce quarrels & creating friendly relations e) face to face communication. 5) Controlling – a) importance to quality b)close control c) collective control

35. Features of Z theory- Involvement of employees Establishment of informal organisational structures Establishment of trust Establishment of strong relation between organisation & employees Establishment of coordination among people Criticism- Lack of reqd efficiency for participation Lack of reciprocal loyalty Lack of group feeling Lack of tolerance in investors Informal organisation cannot work independently Horizontal movement reduces specialisation Z Theory: A practical experience in india- MARUTI UDYOG LIMITED

36. Positive motivators- acc to Flippo- positive motivation is a process of attempting to influence others to do their work through the possibility of gain or reward. Negative motivators- acc to Likert- in the long run negative motivation reduces the productivity. Financial/monetary incentives- i.pay & allowances, ii.productivity linked wage incentive, iii.bonus, iv.profit sharing, v.co-partnership, vi.retirement benefits, vii.perquisites. Non-financial/non-monetary incentives- i.status, ii.organisational climate, iii.career advancement opportunity, iv.job enrichment, v.employee recognition programmes, vi.job security, vii.employee participation, viii.employee empowerment, ix.praise, x.guarantee of justice, xi.knowledge of secret information, xii.fearless environment, xiii.job rotation. Techniques of motivation

37. 5)Individual motivators- Advantages: i. attraction for other employees, ii.increases efficiency, iii.gives the employee a sense of prestige, iv.job evaluation is simple, v.attraction for new entrants. 6)Group motivators- Advantages: i.checks the feeling of mutual conflict, ii.establish industrial peace, iii.all employees work with a team spirit, iv.more work at less time & less cost, v.raises the reputation of the enterprise. 7)Extrinsic motivators- get the benefit afterwards. 8)Intrinsic motivators- get the benefit at the same time.

38. A costly effort Trouble making employees It is an internal feeling Opposition to changes Essentials/principles of motivation- Productive Competitive Comprehensive Flexible Easily understandable Easy implementation Increase in reputation Problems or hurdles in motivation

39. 8. Regular motivation 9. Based on organizational goals 10. Based on standards 11. Related to efforts 12. Justifiable 13. Less expensive