MANAGEMENT : CONCEPT AND NATURE
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1 I-11 CONTENTS About the author I-5 Preface I-7 Chapter-heads I-9 1 MANAGEMENT : CONCEPT AND NATURE 1.1 Concept of Management Features of Management Objectives of Management Importance of Management Aspects of Management Nature of Management Management and Administration Levels of Management Diagrammatic Representation of Levels of Management Managerial Skills Management Process/Management Functions Role of Managers 24 QUESTIONS 26 2 CO-ORDINATION 2.1 Co-ordination Features/Nature of Coordination Importance/Need for Coordination Limitations in Achieving Coordination 32 I-11
2 I-12 Fundamentals of Management 2.5 Types of Coordination Techniques of Coordination Principles of Coordination Coordination and Cooperation Coordination The Essence of Management 38 QUESTIONS 39 3 EVOLUTION OF MANAGEMENT THOUGHT 3.1 Introduction Management Theories Pre-Scientific Management Theories Classical Theory 42 I. Taylor s Scientific Management Theory 43 II. Henri Fayol s Classical Organisation Theory (Management Process Theory) Behavioural Theory 60 I. Human Relations or Neo-classical Theory 61 II. Behavioural Science Theory 65 QUESTIONS 68 3A CONTEMPORARY MANAGEMENT THEORIES Modern Management Theory 69 I. Systems Theory 69 II. Contingency Theory 73 III. Theory of Michael Porter (Born on May 23, 1947) 76 IV. Theory of Michael Hammer ( ) 79 V. Theory of Peter Senge (Born in 1947) 81 VI. Fortune at the Bottom of Pyramid 83 QUESTIONS 92 4 MANAGEMENT BY OBJECTIVES 4.1 Introduction 94
3 Contents I Features of MBO Elements of MBO Objectives of MBO Process of MBO Approaches to MBO Merits of MBO Limitations of MBO Effective MBO 102 QUESTIONS TRENDS AND CHALLENGES OF MANAGEMENT 5.1 Introduction The Global Scenario Knowledge Management in Global Scenario A Transition from Information Value to Knowledge Value Forms of Knowledge Meaning of Knowledge Management Management Functions in Global Scenario Contemporary Issues in Management Changes in the Management Arena 114 QUESTIONS PLANNING FUNCTION 6.1 Introduction Meaning Features of Planning Importance/Objectives of Planning Limitations of Planning Ways to Overcome Limitations Process of Planning Planning Premises Principles of Planning 127
4 I-14 Fundamentals of Management 6.10 Features of a Good Plan Types of Plans Plans on the Basis of Levels in the Organisation Classification on the Basis of Use Classification on the Basis of Time Classification on the Basis of Functional Areas 143 QUESTIONS STRATEGIC PLANNING 7.1 Meaning of Strategic Planning Features of Strategic Planning Importance of Strategic Planning Limitations of Strategic Planning Process of Strategic Planning Levels/Types of Strategies Evaluation of Strategies Business Growth Growth Strategy Importance of Growth Strategy Types of Growth Strategies Internal Growth Strategy Intensive Growth Strategy (Expansion) Diversification External Growth Strategy 163 QUESTIONS BUSINESS ENVIRONMENT (ENVIRONMENTAL ANALYSIS AND DIAGNOSIS) 8.1 Business Environment Relationship between Environment and Business Environment Analysis SWOT Analysis 184
5 Contents I ETOP BCG Matrix Competitor Analysis 191 QUESTIONS DECISION MAKING 9.1 Introduction Meaning of Decision-Making Features of Decision-Making Situations for Decision-Making Decision-Making and Planning Process of Decision-Making Types of Decisions Approaches to Decision-Making Techniques of Decision-Making Models of Decision-Making Information Technology and Decision-making Management Information System Decision Support System 225 QUESTIONS ORGANISING FUNCTION 10.1 Meaning of Organisation Nature of Organisation Process of Organising Importance of Organising Organisation Chart What Does Organisation Chart Show Merits of Organisation Charts Limitations of Organisation Charts Kinds of Organisation Charts 237
6 I-16 Fundamentals of Management Span of Management Principles of Organising 244 QUESTIONS AUTHORITY RESPONSIBILITY RELATIONSHIPS 11.1 Introduction Meaning of Authority Features of Authority Sources of Authority Types of Authority Limitations of Authority Power Sources of Power Authority and Power Responsibility Authority and Responsibility Parity between Authority and Responsibility Accountability 257 QUESTIONS DELEGATION AND DECENTRALISATION 12.1 Meaning of Delegation Features of Delegation What should be Delegated Process of Delegation Forms of Delegation Importance of Delegation Principles of Delegation Elements of Delegation Barriers to Delegation Overcome Barriers to Delegation Centralisation and Decentralisation 268
7 Contents I Decentralisation Importance of Decentralisation Limitations of Decentralisation Factors affecting Decentralisation Delegation and Decentralisation 272 QUESTIONS FORMAL AND INFORMAL ORGANISATIONS 13.1 Introduction Formal Organisation Features of Formal Organisation Merits of Formal Organisation Limitations of Formal Organisation Theories of Formal Organisation Informal Organisation Features of Informal Organisation Merits of Informal Organisation Limitations of Informal Organisation Linking Formal and Informal Relationships on the Organisation Chart Formal and Informal Organisations Integration of Formal and Informal Organisations 285 QUESTIONS TYPES OF ORGANISATION STRUCTURE 14.1 Organisation Structure Elements of Organisation Structure Mechanistic and Organic Structures Factors Affecting Organisation Structure Organisation Formats/Theories Classical Organisational Formats Contemporary Organisational Formats 303 QUESTIONS 313
8 I-18 Fundamentals of Management 15 STAFFING : NATURE AND PROCESS 15.1 Meaning Nature of Staffing Importance of Staffing Staffing Process Job Analysis 321 QUESTIONS RECRUITMENT AND SELECTION 16.1 Introduction Recruitment Sources of Recruitment Selection Differences between Recruitment and Selection Selection Process Selection Tests Interviews 333 QUESTIONS ORIENTATION, TRAINING AND DEVELOPMENT 17.1 Attracting and Retaining Human Resource What is Orientation Facts to Orient Employees Training Need for Training Importance of Training Methods of Training On-the-job and off-the-job training methods Development Need for Development 347
9 Contents I Methods of Management Development Effective Management Development Programme Training and Development 349 QUESTIONS CAREER DEVELOPMENT AND PERFORMANCE APPRAISAL 18.1 Career Development Objectives of Career Development Stages of Career Development Process Performance Appraisal Objectives of Appraisals Merit Rating and Performance Appraisal Importance of Appraisals Approaches to Performance Appraisal Methods of Performance Appraisal Essentials of a Good Appraisal System Performance Appraisal Process Barriers to Appraisal How to make Appraisals Effective 362 QUESTIONS MOTIVATION 19.1 Meaning of Motivation Model of Motivation Motivators Nature of Motivation Importance of Motivation Theories of Motivation Need Theories Behavioural Theories 379 QUESTIONS 386
10 I-20 Fundamentals of Management 20 LEADERSHIP 20.1 Meaning of Leadership Nature of Leadership Importance of Leadership Management and Leadership Leadership Styles Theories of Leadership Behavioural Theories Situational or Contingency Theories Effective Leadership Transactional vs. Transformational Leadership 408 QUESTIONS COMMUNICATION 21.1 Introduction Meaning of Communication Nature of Communication Importance of Communication Process of Communication Channels of Communication Dimensions of Communication Medium of Communication Verbal Communication Non-verbal Communication Channels of Communication on the Organisation Chart Communication Networks Communication Barriers Causes of Communication Barriers Effective Communication (Overcoming Barriers to Communication) 443 QUESTIONS 445
11 Contents 22 CONTROL - CONCEPT AND PROCESS I Meaning Nature of Control Importance of Control Relationship between Planning and Control Types of Control Control Process Management or Control by Exception Effective Control System Principles of Control 458 QUESTIONS TECHNIQUES OF CONTROL 23.1 Introduction Techniques of Control Budgetary Control Network Techniques PERT and CPM Ratio Analysis Economic Value Added (EVA) Market Value Added (MVA) 473 QUESTIONS 473
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