Management Functions & Theories

Management

Management is a distinct process of planning, organizing, staffing, directing, and controlling, performed to determine and accomplish stated objectives by the use of human and other business resources.

POSDICON

Acronym for Planning, Organizing, Staffing, Directing, Controlling, and other business Resources.

Men

One of the resources used in management.

Money

One of the resources used in management.

Materials

One of the resources used in management.

Machines

One of the resources used in management.

Methods

One of the resources used in management.

Market

One of the resources used in management.

Nature of Management

Management is the force that runs an enterprise and is responsible for its success and failure.

Management Functions

Planning, organizing, staffing, directing, and controlling are the fundamental functions of management.

Organizing

Involves grouping people, establishing relationships among them, and defining authority and responsibility to attain goals.

Controlling

Measuring and correcting activities to assure conformity to plans.

Stated Objectives

End-results that management measures performance against.

Social Responsibility

Management's responsibility to consider profit and how to get back on track if corrections are needed.

Planning

Involves formulating objectives, programs, policies, procedures, rules, and regulations to achieve business goals.

Staffing

Involves filling and keeping positions in the organization structure.

Directing

Involves motivation, leadership styles, approaches, and communication.

Management as an Art

Results in accomplishing objectives through human efforts, requiring skill and careful study.

Management as a Science

A systematic body of knowledge that gathers and analyzes facts to formulate general laws or principles.

Classical Management Theory

Built on principles and emphasizes the division of work, authority, responsibility, unity of command, and remuneration.

Scientific Management Principles

Developing a science for each element of work, selecting and training workers, cooperating with workers, and dividing work and responsibility equally between management and workers.

Piece-Rate Incentive System

A system that emphasizes developing the best way to perform each job and establishing cooperation between management and workers.

Motion Study

A detailed analysis of motions to eliminate ineffective motions and improve work efficiency.

Scalar Chain

A chain of superiors from the highest to the lowest ranks in an organization.

Stability of Tenure

The need to avoid unnecessary labor turnover by giving employees enough time to prove their worth.

Span of Control

Refers to the specific and limited number of subordinates a manager can effectively handle.

Therbligs

Basic elemental motions in a motion study, such as Reach, Move, Grasp, Release, and Pre-Position

Business

Activity involving production and distribution of goods/services for profit, meeting consumer needs

Factors of Production

Economic resources (land, labor, capital, entrepreneur) used to produce goods and services

Maslow's Hierarchy of Needs

Hierarchical model of human needs: Physiological, Safety, Social, Esteem, Self-Actualization

Profit Motive

Prime motivator in business; entrepreneurs provide goods/services for consumer demand

Capitalism

Economic system where means of production are privately owned for personal gain

Communism

Economic system where the government owns and controls all means of production

Sole Proprietorship

Business owned by one person, easy formation, limited liability, ends with proprietor's death

Partnership

Business owned by two or more partners, easy formation, shared profits, may end with partner's death

Corporation

Business entity separate from owners, complex formation, extensive liability protection

Phases of Economic Development

Historical progression from hunting/fishing to industrial phases in economic activities

Entrepreneurship

Process of buying and organizing factors of production to provide goods/services for profit

International Business Environment

Business operations conducted across national borders, involving exporting, importing, and multinational corporations

Cooperative

Owned by members to provide needed goods and services, managed in their interest.

Franchise

Contract granting permission to operate a business using a set method.