Lecture notes –Institute of Accountancy Training

Lecture One: Nature and Purpose of Management

1 Definition of Management
2 Features, Objectives and Importance of Management
3 Management and Administration
4 Levels of Management
5 Management, Science or Art

Nature of Management
The origin of management can be traced back to the days when man started living
in groups. History reveals that strong men organized the masses into groups
according to their intelligence, physical and mental capabilities. Evidence of the
use of the well recognized principles of management is to be found in the
organization of public life in ancient Greece, the organization of the Roman
Catholic Church and the organization of military forces. Thus management in
some form or the other has been practiced in the various parts of the world since
the dawn of civilization. With the onset of Industrial Revolution, however, the
position underwent a radical change. The structure of industry became extremely
complex. At this stage, the development of a formal theory of management became
absolutely necessary. It was against this background that the pioneers of modern
management thought laid the foundations of modern management theory and
practice.

A comprehensive definition of Management:

In mid 1940s, academic people from various business schools in the United States
gathered together with the sole purpose of deciding whether a definition of
management could be written that businessmen would accept and practice and
academicians would teach. Ultimately they came up with the fallowing definition
which no individual is identified with this definition. According to the group;
“Management is guiding human and physical resources into a dynamic
organization units that attain their objectives to the satisfaction of those served and
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with the high degree of moral and sense of attainment on the part of those
rendering the services”

Definition of Management by some famous Management Thinkers;

According to Batal and Martins (1998), Management is the process of achieving
organizational goals by engaging in the four (4) functions of management (ie
planning, organizing, leading and controlling).
Koontz and Weihrich also define management as the process of designing an
environment in which individuals working together in a group efficiently
accomplish aims and objectives.

Management can also be defined as the process of planning, organizing, leading

and controlling the work of organizational members and using all the available
organizational resources to reach or achieve stated organizational goals.

Features of Management
1. Management is an ongoing activity- a process that is continuous.
2. It involves reaching important goals.
3. It involves how to perform major managerial functions of planning,
organizing, leading and controlling.
4. Management applies to all kinds of organizations ie profit making
organizations or nonprofit making organization, small or large organizations,
organizations that produces tangible goods or renders services.
5. It applies to managers at all organizational levels eg. Frontline, middle and
top managers.
6. The aims of all managers are the same ie to create resources in terms profit
making.
7. Management is concerned with productivity. This implies efficiency and
effectiveness.
Productivity= Output/Input ie output per input.

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Objectives of Management

1. Helps an organization to achieve its objectives successfully.

2. Promote effectiveness and efficiency in an organization
3. It develops the ability of managers.
4. It enhances human welfare
Functions of Management
PLANNING
Planning is an important function of management because it sets the pace for
all subsequent steps in the managerial process. You need to develop a
roadmap for the future—predefined steps—to accomplish organizational
goals. In this step, you will have to evaluate methods and strategies to
determine how you’ll progress toward your goal.

You may have to look at how things were done in the past to make any
adjustments to mitigate errors. You have to consider both internal factors—
people, time and cost—and external factors—competitors, policies and
general business environment—to arrive at a sound planning strategy.

ORGANIZING
This is where you put your plan into action by establishing a system of
authority or hierarchy in the context of your organizational structure.
Determine the tasks that need to be completed to achieve your goals before
assigning them to your staff. As opposed to the traditional ways of working
where a manager made all the decisions, today’s business world is more
dynamic and flexible. Every member of the organization—regardless of
position—shares accountability and responsibility.

So, define an organizational structure that aligns with your workplace and
assign tasks that map to your team’s skills and abilities. You have to get
everyone on the same page and delegate tasks the way you see fit.

STAFFING
This is another important function of management. You have to assign tasks
based on each team member’s knowledge, skills and abilities. You have to

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be careful here because you may have to hire new talent for specific tasks
that require specific technical expertise. Assessing the needs of your
employees in terms of incentives, training and development and
compensation are critical for the success of this step.

An effective manager will have the insight to evaluate the competency and
efficiency of their employees. This is to ensure that their assigned tasks
match their skills. You have to adopt an empathetic approach to connect
with your employees and understand their strengths and weaknesses.

DIRECTING
Directing is concerned with supervising your team’s progress. In this step,
you have to keep an open channel of communication and get regular updates
to stay on top of things. A great way to do this is by giving and receiving
feedback to address any problem areas and improve performance. This is
where you have to act as a leader, navigate conflict and motivate your
employees to take initiative.

Harappa Education’s Managing Teamwork course will teach you the Skill-
Will Matrix—attributed to leadership coach Max Landsberg. It’s a quick and
easy way to assign tasks based on the capabilities and motivation of each
member.

As a manager, you have to give each team member enough autonomy to

help them stay motivated and perform without constant supervision. Besides
monitoring your team, you also have to keep your manager and other
stakeholders informed with progress reports. The entire organization should
work like a well-oiled machine to achieve your goals in a time-effective
manner.

CONTROLLING
This is where you have to measure the progress of each step established in
the planning stage against your organizational goals. This step requires you
to coordinate with your employees to ensure that they’re moving in the right
direction and in the right manner. According to Gulick’s 7 functions of
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 management, controlling can be understood in terms of coordinating,
reporting and budgeting.

Not only do you have to ensure that every step is going according to plan, but also
watch out for potential problems to take corrective measures. Make timely
adjustments and modifications where necessary. It’ll help you accomplish your
goals faster within your timeframe and your budget. Take this opportunity to
cooperate with everyone on your team.

Management and Administration

There are two theoretical view points about management and administration. One
view point has stated that management is above administration and administration
is part of management. The other view point also stated that administration is
above management and management is part of administration.

Management is above Administration: This view has been advocated by British

authors, Breech, Kimball and Kimball, Richman etc. According to Breech,
“management is a social process entailing responsibilities for the effective and
economical planning and regulation of the operation of an enterprise in fulfillment
of given purpose or task”. Administration is part of management which concerned
with the installation and carrying out of the procedures by which the program is
laid down and communicated and progress of activities is regulated and checked
against plans. Thus according to this view point, management is a high level
function concerned with laying organizational plans and policies.

Administration is above management: This view point has been advocated by

American authors Oliver Sheldon, Spriegal , Theo Haimann, McFarland etc.
According to them administration is a high-level function of laying down policies,
plans and objective. According to Oliver Sheldon, “administration is concerned
with the determination of corporate policy, the coordination of finance, production
and distribution, and the ultimate control of executive”. Accordingly,
administration determines the organization; management uses it. Administration
defines the goal, management strives towards it.

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Management and Administration are the same: Chester Bernard, George R,
Terry etc, have advocated that management and administration are the same.
According to them the difference is not in their meaning, but in their application.
Administration and management are carried by managers at all levels –top, middle
and low. Whiles managers at top level performs more administration, those at
lower level perform more management.

Levels of Management

Managerial Job Time

The dimension of managerial job time are vertical and horizontal or hierarchical
and responsibility area respectively.

Vertical Levels
We can identify 3 levels of the vertical managerial job time (management levels)

Levels of Management

 First line managers.

 Middle managers.
 Top managers.

Top

Middle

First line

1. First line Managers: They are managers of the lower levels of hierarchy
who are directly responsible for the work of operating employees. They
include supervisors. First line managers are extremely important to the
success of the organization because they have the responsibility to see to it
that day-to-day activities are carried out smoothly in enhancing
organizational growth.
2. Middle Managers: These are managers located beneath the top levels of
management who are directly responsible for lower level managers.
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 Sometimes middle managers supervise operation personnel such as
administrative assistance. Middle managers are mainly responsible for
implementing overall organizational plans so that organizational goals can
be achieved as expected.
3. Top Managers: These are the managers at the very top level of the
hierarchy who are ultimately responsible for the entire organization. They
are few in number and their and their typical titles include chief executive
officers, Vice President, Executive Director etc. Top managers have direct
responsibility for the upper layer of middle managers.
They typically oversee the overall role or policies of the organization worth
some degree with middle managers in implementing that policy and
maintain overall control over the progress of the organization.

Management: Management as a Profession, science or arts.

According to the nature of management, there is a controversy that whether

management is a science or an art. This controversy is very old & is yet to be
settled. It should be noted that, learning process of science is different from
that of art. Learning of science includes principles while learning of art
involves its continuous practice.

Management as a Science

Science is a systematic body of knowledge relating to a specific field of

study that contains general facts which explains a phenomenon. It
establishes cause and effect relationship between two or more variables and
underlines the principles governing their relationship. These principles are
developed through scientific method of observation and verification through
testing.

Science is characterized by the following main features:

1. Universally accepted principles – Scientific principles represents basic

truth about a particular field of enquiry. These principles may be applied in
all situations, at all time & at all places. E.g. – law of gravitation which can
be applied in all countries irrespective of the time.

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 Management also contains some fundamental principles which can be
applied universally like the Principle of Unity of Command i.e. one man,
one boss. This principle is applicable to all type of organization – business
or non business.

2. Experimentation & Observation – Scientific principles are derived

through scientific investigation & researching i.e. they are based on logic.

E.g. the principle that earth goes round the sun has been scientifically
proved. Management principles are also based on scientific enquiry &
observation and not only on the opinion of Henry Fayol. They have been
developed through experiments & practical experiences of large no. of
managers.

E.g. it is observed that fair remuneration to personal helps in creating a

satisfied work force.

3. Cause & Effect Relationship – Principles of science lay down cause

and effect relationship between various variables.

E.g. when metals are heated, they are expanded. The cause is heating & result is
expansion.

The same is true for management; therefore it also establishes cause and effect
relationship.

E.g. lack of parity (balance) between authority & responsibility will lead to
ineffectiveness. If you know the cause i.e. lack of balance, the effect can be
ascertained easily i.e. ineffectiveness. Similarly if workers are given bonuses,
fair wages they will work hard but when not treated in fair and just manner,
reduces productivity of organization.

4. Test of Validity & Predictability – Validity of scientific principles can

be tested at any time or any number of times i.e. they stand the time of test.
Each time these tests will give same result. Moreover future events can be
predicted with reasonable accuracy by using scientific principles.

E.g. H2 & O2 will always give H2O.

Principles of management can also be tested for validity.

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 E.g. principle of unity of command can be tested by comparing two persons
– one having single boss and one having 2 bosses. The performance of 1st
person will be better than 2nd.

It cannot be denied that management has a systematic body of knowledge

but it is not as exact as that of other physical sciences like biology, physics,
and chemistry etc. The main reason for the inexactness of science of
management is that it deals with human beings and it is very difficult to
predict their behaviour accurately. Since it is a social process, therefore it
falls in the area of social sciences. It is a flexible science & that is why its
theories and principles may produce different results at different times and
therefore it is a behaviour science.

Management as an Art

Art means application of knowledge & skill to get the desired results. An art
may be defined as personalized application of general theoretical principles
for achieving best possible results. Art has the following characters –

Practical Knowledge: Every art requires practical knowledge therefore

learning of theory is not sufficient. It is very important to know practical
application of theoretical principles.

E.g. to become a good painter, the person not only should know about the
different colour and brushes but different designs, dimensions, situations etc
to use them appropriately. A manager can never be successful just by
obtaining degree or diploma in management; he must have also known how
to apply various principles in real situations, by functioning as a manager.

Personal Skill: Although theoretical base may be same for every artist, but
each one has his own style and approach towards his job. That is why the
level of success and quality of performance differs from one person to
another.

E.g

. there are several qualified painters but M.F. Hussain is recognized for his
style. Similarly management as an art is also personalized. Every manager
has his own way of managing things based on his knowledge, experience
and personality, that is why some managers are known as good managers
whereas others as bad.
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Creativity: Every artist has an element of creativity in line. That is why he
aims at producing something that has never existed before which requires
combination of intelligence & imagination. Management is also creative in
nature like any other art. It combines human and non-human resources in an
useful way so as to achieve desired results. It tries to produce sweet music
by combining chords in an efficient manner.

Perfection through practice: Practice makes a man perfect. Every artist

becomes more and more proficient through constant practice. Similarly
managers learn through an art of trial and error initially but application of
management principles over the years makes them perfect in the job of
managing.

Goal-Oriented: Every art is result oriented as it seeks to achieve concrete

results. In the same manner, management is also directed towards
accomplishment of pre-determined goals. Managers use various resources
like men, money, material, machinery & methods to help in the growth of an
organization.

Thus, we can say that management is an art therefore it requires application

of certain principles rather it is an art of highest order because it deals with
shaping the attitude and behaviour of people at work towards these desired
goals.

Management as both Science and Art

Management is both an art and a science. The above mentioned points

clearly reveal that management combines features of both science as well as
art. It is considered as a science because it has an organized body of
knowledge which contains certain universal truth. It is called an art because
managing requires certain skills which are personal possessions of
managers. Science provides the knowledge & art deals with the application
of knowledge and skills.

A manager to be successful in his profession must acquire the knowledge of

science & the art of applying it. Therefore management is a well-judged
combination of science as well as an art because it proves the principles and
the way these principles are applied is a matter of art. Science teaches to
’know’ and art teaches to ’do’. E.g. a person cannot become a good singer
unless he has knowledge about various ragas & he also applies his personal
skill in the art of singing. Same way it is not sufficient for manager to first
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 know the principles but he must also apply them in solving various
managerial problems that is why, science and art are not mutually exclusive
but they are complementary to each other (like tea and biscuit, bread and
butter etc.). To conclude, we can say that science is the root and art is the
fruit.

Management as a Profession:

Profession can be defined as an occupation backed by specialised knowledge and

training, in which entry is restricted.

The main features of profession are:

1. Well defined Body of knowledge:

In every profession there is practice of systematic body of knowledge which helps

the professionals to gain specialised knowledge of that profession. In case of
management also there is availability of systematic body of knowledge.

There are large numbers of books available on management studies. Scholars are
studying various business situations and are trying to develop new principles to
tackle these situations. So presently this feature of profession is present in
management also.

2. Restricted Entry:

The entry to a profession is restricted through an examination or degree. For

example a person can practice as Doctor only when he is having MBBS degree.

Whereas there is no legal restriction on appointment of a manager, anyone can

become a manager irrespective of the educational qualification. But now many
companies prefer to appoint managers only with MBA degree. So presently this
feature of profession is not present in management but very soon it will be
included with statutory backing.

3. Presence of professional associations:

For all the professions, special associations are established and every professional
has to get himself registered with his association before practicing that profession.
For example, doctors have to get themselves registered with Medical Association
of Ghana, lawyers with Ghana Bar Association etc.
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In case of management various management associations are set up at national and
international levels which have some membership rules and set of ethical codes,
for example, CIMA , etc., but legally it is not compulsory for managers to become
a part of these organisations by registration. So presently this feature of profession
is not present in management but very soon it will be included and get statutory
backing also.

4. Existence of ethical codes:

For every profession there are set of ethical codes fixed by professional
organisations and are binding on all the professionals of that profession. In case of
management there is growing emphasis on ethical behaviour of managers.

So presently this feature of profession is not present in management but very soon
it will be included with statutory backing.

5. Service Motive:

The basic motive of every profession is to serve the clients with dedication.
Whereas basic purpose of management is achievement of management goal, for
example for a business organisation the goal can be profit maximisation.

But nowadays only profit maximisation cannot be the sole goal of an enterprise. To
survive in market for a long period of time, a businessman must give due
importance to social objectives along with economic objectives. So presently this
feature of profession is not present but very soon it will be included.

We all strive to be a truly great Manager: a Manager who earns the respect of
many, someone who is inspiring, in short, a pleasure to work for. But it’s not easy,
and as many of us know, great managers are few and far between.

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ORGANISATIONAL ENVIRONMENT

Internal Environment
Internal factors like men, machine, money, material, etc., on which organisation
decision depends consists internal environment. The internal environment refers to
the forces that are within the organisation and affects its ability to serve its
customers. It includes marketing managers, production managers, procedures,
inventory, logistics, and anything within organisation which affects decisions and
its relationship with its customers.

External Environment
The external environment consists of the task environment and the broad or mega
environment. The task environment includes the immediate actors involved in
producing, distributing, and promoting the offering, including the company,
suppliers, distributors, dealers, and the target customers.

Types of External Environment

The world as we know is undergoing tremendous. These changes can be

understood by defining and examining components of the external environment.

The system theory in our previous lesson helps us to understand the importance of
the environment to organizations. According to the system theory organization is
likely to be more successful if it operates as an open system that continually
interacts with and receives feedback from its external environment. As a result of
the above therefore managers need to understand considerably the external
environment that organizations faces.

The external organizational environment includes all elements existing outside the
boundary of the organization that have the potential to affect the organization. The

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environment includes competitors, technology and economic conditions. The
external environment of an organization can be divided into two major segments.

MEGA ENVIRONMENT

TASK ENVIRONMENT

 Mega/general environment
 Task environment

Mega/General environment:- it is the segment of that is widely disperse and affects

organizations indirectly. The mega/general environment consists of five major
elements. They are as follows;

 Technological
 Economic
 Legal-political
 Socio-cultural
 International

These events do not directly change day-to-day operations transactions but they do
have affected all organizations eventually.

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Political and Legal:
This includes laws coming from Common Law, parliamentary legislation and
government regulations derived from it and obligations by the countries towards
certain treaties sign in the international scene.
Legal factors affecting companies.

Category Example

General Legal This covers basic ways of doing business,

Framework: Contract, negligence proceedings and so on
tort, agency

Criminal Law Theft, insider dealing, bribery, deception

Company Law Directors and their duties, reporting

requirements, takeover, insolvency

Employment Law Trade union recognition, minimum wage

unfair dismissal, redundancy

Health and Safety Fire Precautions, safety procedures

Environment Pollution control

Tax Law Company tax, income tax, VAT

Some legal and regulatory factors affect particular industries. the political
environment is not simply limited to legal factors. Government policy affects the
whole economy and government are responsible for enforcing and creating a stable
framework in which business can be done. A recent report by the World Bank

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indicated that the quality of government is important since it largely determines the
standard of important aspects of the national infrastructure. That is

 Physical infrastructure (transport)

 Social infrastructure (education, law enforcement)
 Market infrastructure (enforcement of contracts)

Government economic policy is conducted with a number of aims in mind, which

often conflict with each other.

 Economic growth
 Full employment
 Price stability

In additions to legislation and regulations for influencing economic activity,

government uses various policy tools.

 Fiscal policy:- taxation, government spending borrowing whenever exceeds

income, repaying debt when income exceed expenditure.
 Monetary policy:- interest rates, exchange rates, control of the money supply
and control over bank lending.

Economic

The element encompasses the system of producing, distribution and consuming

wealth. To be more specific, it is the consumer’s purchasing power, interest rates,
and unemployment. Countries normally operate different economic systems. We
have the capitalist system that the market forces govern economic activities that
are demand and supply forces. In capitalist economy, the means of production are
in the hand of individuals either directly or by companies. In such system to curb
abuses by private entrepreneurship government come out with regulating bodies

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that see to fairness in the market environment. In a socialist economy, the means
of production are owned by the stage and economic activity is co-ordinated by
plan.

In a capitalist state that we are much interested government policy influences

economic activity. The general state of the country’s economy will determine how
business prospers. Fr example if a company pursue prudent management and the
state of the economy is bad in terms of fiscal and monetary factors, no amount of
management techniques or model will help the company.

Social-cultural

 Demographic characteristics
 Norms
 Cultures

Demography is the study of the structure and distribution of human population

using statistics relating to birth, death, disease and social indicators such as wealth,
income and education. It is an important input into economic and business
planning because of the following;

 People create demand for goods and services

 Economic growth should exceed population growth to enhance standard
of living
 Population is the source of labour one of the factors of production
 Population creates demands on the physical environment and its
resources, a source of increased political concerned.

Culture is a term used by sociologist and anthropologist to encompass the sum total
of the belief, knowledge, attitudes of mind and customs to which people are

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exposed in their social conditioning. Through contact to a particular culture,
individuals learn a language, acquire and habits of behaviours and thought.

Technological

The technology dimension includes scientific advancement in a specific industry as

well as in society at large. Fifteen years ago, many organizations did not even use
desktop computers. Today, computer network, internet access, video conferencing
capabilities, cell phones, fax machines, pagers, laptops are practically taken for
granted as the minimum tool for doing business.

The technology environment is changing at a lighting speed. For example,

conductor firms are now working to develop new memory chips for personal
computers, other high-tech firms are trying to create technologies that will replace
the PC with even better computing architecture. At the same time, computers,
telephone, television and wireless forms of communication are being emerged to
create multi-media products and to allow users anywhere in the world to
communicate with each other. In addition, a growing number of people have
access to the internet allowing them to obtain information from literally millions of
sources and the number of websites is rising shapely.

In order to remain competitive, organization may stay abreast of current

technological developments that may affect their ability to offer desirable products
and services.

International

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This involves the development in countries outside an organization’s home country
that will have potential influence on the organization. For example, the war in Iraq
have pushed crude oil prices high thereby affecting almost every organization in
terms of transportation.

Task Environment

Is the segment of the external environment made up of the specific outside

elements with which an organization interferes in the course of conducting its
business. In other words, they are those sectors that have a direct working
relationship with the organization, among them are the following;

 Customers and clients

 Competitors
 Suppliers
 Labour market
 Government Agencies

Customers and clients

They are the people in organization in the environment who acquires goods or
services from the organization. As recipients of the organization’s output,
customers are important because they determine the organization’s success.
For example, patients are the customers of hospitals, students are the customers
of schools, and travelers are the customers of airlines. Every company whether
profit or non-profit making has to stay close to its customer. The business
model for today requires that companies have to produce for the market and
not to the market. Levy Strauss’s fortunes have faded faster than a pair of new

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jeans in recent years because of the company’s failure to respond quickly to
faction trends such as flared legs, cargo pockets and buggy trousers.

Competitors

Other organization in the same industry or type of business that provide goods
or services to the same set of customers are referred to as competitors. Each
industry is characterized by a specific competitive issues. The recording
industry differs from steel industry and the pharmaceutical industry.
Competitive wars are being waged in all industries. Coke and Pepsi continue
to battle it out for the soft drink market.

Suppliers

Suppliers provide the raw materials the organization uses to produce its output.
A steel mill requires iron ore, machine and financial resources. A small
university may utilize hundreds of suppliers for paper, pencils, cafeteria food,
computers, trucks, fuel, electricity and text books.

Label

The labour market represents people in the environment who can be hired to
work for the organization. Every organization needs a supply of trained,
qualified personnel. Employers can expect to recruit from a labour that is
becoming increased diverse.

Government agencies
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 This involves the interactions with representatives of specific government
agencies in the local area that is, tax office, VAT, Police as well as the National
level.

MANAGERIAL SKILLS AND COMPETENCIES

A skill is the ability to engage in a set of behaviors that are

functionally related to one another and that lead to a desire
performance level in a given area. For managers, there are three (3)
types of skills

 Technical Skills : These are skills that reflect both an understanding

off and proficiency in a specialized field e.g. a manager may have
technical skills in business administration, accounting, marketing etc
 Human skills: These are skills associated with the manager’s ability
to work well with others both as a manager of a group and as a leader
who gets things done through others.
 Conceptual skills: These are the skills related to the ability to
visualized the organization as a whole, discern into the inter-
relationship among organizational parts and understand how the
organization fix into the wider contest of the industry, community and
the world.

We all strive to be a truly great Manager: a Manager who earns the respect of
many, someone who is inspiring, in short, a pleasure to work for. But it’s not easy,
and as many of us know, great managers are few and far between.

Some Qualities that make a Manager effective

1. Integrity

Integrity fosters trust, which in turn builds loyalty. A manager with loyal
staff has the capability to be very effective. They have staff that they know
they can rely on and, in turn, their staff are confident in their abilities to
deliver knowing they have the support of their manager.

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2. Empower

An effective manager empowers his or her staff to perform at their best. This
means creating an environment for success: setting boundaries so that people
can take responsibility, creating opportunities that allow people to challenge
their abilities, motivating people to find new and innovative ways, all while
also ensuring support structures are in place.

3. Motivation

People perform at their best when they are happy and motivated. But there is
much more to motivation than salary or bonuses. A manager that
understands his or her employees can set challenging yet achievable goals
and rewards in a variety of ways. People can be motivated by interesting
work, by being part of an effective team, by the prospect of learning new
skills, or by the knowledge that their hard work will be recognised and
appreciated.

4. Delegate

An effective manager understands the skills and abilities of his or her staff,
and knows how to delegate. Effective delegation is selecting the right person
to do the work, given the constraints of skill requirements and time.
Delegation is entrusting the person with the responsibility to complete the
work. It includes setting clear guidelines and expectations as well as
boundaries for decision-making responsibilities.

5. Adaptable

The business environment is an ever-changing one. All managers must be

able to quickly adjust, understanding the implications of the changes and
adjusting goals and strategies accordingly. An adaptable manager sets an
example to his/her employees and leads the way in demonstrating new ways
of working and/or behaving.

6. Takes action

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An effective manager takes action. If they see a problem they address it.
This may seem obvious, but all to often there are decisions that many
managers find to difficult to take, so they put it off until a later date. Or
perhaps they move the problem for someone else to solve, such as the poor
performing employee that gets moved around the organisation.

7. Networker

Anyone can obtain the organisation chart, but what is more useful for any
manager is to understand the real network within the business. Who are the
key people that can make things happen? It’s about understanding who
affect the decisions you make today and in the future, and ensuring you have
a good relationship with them.

8. Understands the Business Culture

For any manager to be successful in a business they need to understand it’s

culture. This means they understand the goals and strategic drivers, they
appreciate the future vision for the business, and they know how things
happen. Understanding how the ‘wheels turn’ within a business helps a
manager work more effectively and equally helps them contribute to the
overall strategy and goals.

9. Role Model

An effective manager sets an example, to all staff, of appropriate behaviour

and performance standards. It may seem obvious, but it is extremely difficult
to expect others to behave in a particular way, if you yourself do not set such
an example.

10.Value people above all else

A job well done is not about systems or processes or figures; it’s about
people. An effective manager recognises the importance of people in
business, and shows everyone respect regardless of the role that they play.
An effective manager listens to people; is fair and understanding. This does
not mean they can always keep everyone happy; because as a manager this
simply is not the case, however if a decision is reached though a fair process
people understand how the outcome was reached even if they don’t
necessarily agree with result.

23
EVOLUTION OF MANAGEMENT THEORIES

1. Introduction
2. Pre- classical Management theories
3. Classical theory:
 Scientific management theory- Fredrick Taylor
 Administrative theory- Henri Fayor
 Bureaucratic theory- Max Weber

Introduction

Organizations and managers have existed for thousands of years. The Egyptian
pyramids and the Great Wall of China were projects of tremendous scope and
magnitude, and required good management. Regardless of the titles given to
managers throughout history, someone has always had to plan what needs to be
accomplished, organize people and materials, lead and direct workers, and impose
controls to ensure that goals were attained as planned.

Two historical events significant to the study of management are work of Adam
Smith, in his book,’ The Wealth of Nations’, in which he argued brilliantly for the
economic advantages of division of labor (the breakdown of jobs into narrow,
repetitive tasks).
The Industrial Revolution is second important pre-twentieth-century influence on
management. The introduction of machine powers combined with the division of
labor made large, efficient factories possible. Planning, organizing, leading, and
controlling became necessary activities.

Pre-Classical Management Theories

The development of management as a field is mach recent. Much of the impetus
for developing management theories and principles stem from the industrial
revolution which the growth of factories in the early 1800s. With the proliferation
of factories came the spread need to coordinate the factories large of large numbers
of people.
These challenges brought forth a number of individuals who began to think about
innovative ways to run factories more efficiently. This group known as the pre-

24
classical contributors in management focuses on particular techniques that must be
applied to some specific problems.

The Pre-classical contributors operated in the middle and late 1800s. The ideas of
these contributors laid the ground work for subsequent broader enquiries into the
nature of management. Among the principals of Pre-classical contributors are:

a. Robert Owen (1771-1858)

b. Charles Babbage (1992-1871)
c. Henry R. Towne (1844-1924)

Robert Owen a successful British Entrepreneur advocated concern for the working
and living conditions of workers. He was well ahead of his time in recognizing the
importance of human resources. His cotton mill in New Lanark, Scotland
employed 400-500 young people. Although his business partners resisted some of
his ideas, Owen tried to improve the living condition of the employees by
upgrading streets, houses, sanitation and educational system in New Lanark. His
ideas laid the ground work for the human relations movement.

Charles Babbage an English Mathematicians is widely known as the father of

modern computing. He built the first mechanical calculation and prototype of
modern computers. He was enthralled with the idea of work specialization, the
degree to which work was divided into various jobs. He recognized that not only
physical work but mental work as well could be specialized. Babbage also devised
a profit- sharing plan that had to parts; a bonus that was awarded for useful
suggestion and a portion of wages that was depended on factory profit.

Henry R. Towne outlines the importance of management as a science and called

for development of principles.

Classical Management Theory

Classical organization and management theory is based on contributions from a
number of sources. They are scientific management, Administrative management
theory and bureaucratic model. This is a perspective of management that
emphasizes finding ways to manage work and organization more efficiently. The
view point is labeled classical because it encompasses early works and related
contributions that have formed the main root of the field of management.

25
Scientific Management Approach
Scientific management is defined as the use of the scientific method to determine
the “one best way” for a job to be done. Major with this method includes:
a. Fredrick Winslow Taylor (1856-1915)
b. Frank Gilbreth (1868-1924)
c. Lillian Gilbreth (1868-1924)

The most important contributor in this field was Frederick W. Taylor who is
known as the “father” of scientific management. Using his principles of scientific
management, Taylor was able to define the “one best way” for doing each job.
Frederick W. Taylor Started as an apprentice machinist in Philadelphia, USA and
rose to be the chief engineer at the Midvale Engineering Works and later on served
with the Bethlehem Works where he experimented with his ideas and made the
contribution to the management theory for which he is so well known. Frederick
Winslow Taylor well- known as the founder of scientific management was the first
to recognize and emphasis the need for adopting a scientific approach to the task of
managing an enterprise.
He tried to diagnose the causes of low efficiency in industry and came to the
conclusion that much of waste and inefficiency is due to the lack of order and
system in the methods of management. He found that the management was usually
ignorant of the amount of work that could be done by a worker in a day as also the
best method of doing the job. As a result, it remained largely at the mercy of the
workers who deliberately shirked work (soldiering). He therefore, suggested that
those responsible for management should adopt a scientific approach in their work,
and make use of "scientific method" for achieving higher efficiency. The scientific
method consists essentially of:
(a) Observation
(b) Measurement
(c) Experimentation and
(d) Inference.
He advocated a thorough planning of the job by the management and emphasized
the necessity of perfect understanding and co-operation between the management
and the workers both for the enlargement of profits and the use of scientific
investigation and knowledge in industrial work.

He summed up his approach in these words:

26
• Science, not rule of thumb
• Harmony, not discord
• Co-operation, not individualism
• Maximum output, in place of restricted output
• The development of each man to his greatest efficiency and prosperity.

Elements of Scientific Management:

The techniques which Taylor regarded as its essential elements or features may be
classified as under:
1. Scientific Task and Rate-Setting (work study): Work study may be defined as
the systematic, objective and critical examination of all the factors governing the
operational efficiency of any specified activity in order to effect improvement.
2. Planning the Task: Having set the task which an average worker must strive to
perform to get wages at the higher piece-rate, necessary steps have to be taken to
plan the production thoroughly so that there is no bottle neck and the work goes on
systematically.
3. Selection and Training: Scientific Management requires a radical change in the
methods and procedures of selecting workers. It is therefore necessary to entrust
the task of selection to a central personnel department. The procedure of selection
will also have to be systematized. Proper attention has also to be devoted to the
training of the workers in the correct methods of work.
4. Standardization: Standardization may be introduced in respect Tools and
equipment, Speed, Conditions of Work, Materials.
5. Specialization: Scientific management will not be complete without the
introduction of specialization.
6. Mental Revolution: At present, industry is divided into two groups –
management and labour. The major problem between these two groups is the
division of surplus. The management wants the maximum possible share of the
surplus as profit; the workers want, as large share in the form of wages. Taylor has
in mind the enormous gain that arises from higher productivity. Such gains can be
shared both by the management and workers in the form of increased profits and
increased wages.

Frank and Lillian Gilbreth were inspired by Taylor’s work and proceeded to study
and develop their own methods of scientific management. They devised a
classification scheme to label 17 basic hand motions called therbligs in order to
eliminate wasteful motions.
In Frank’s early career as an apprentice bricklayer, he was interested in
standardization and method study. He watched bricklayers and saw that some
workers were slow and inefficient, while others were very productive. He
27
discovered that each bricklayer used a different set of motions to lay bricks. From
his observation, Frank isolated the basic movements necessary to do the job and
eliminated the unnecessary motions. Workers using these movements raised their
output from 1,000 to 2,700 bricks per day. This was the first motion study designed
to isolate the best possible method of performing a given job. Later, Frank and his
wife Lillian studied job motions using a motion picture camera and split-second.
When her husband died at the age of 56, Lillian continued their work.

Administrative Theory
This focuses on principles that can be used by managers to co-ordinate the internal
activities of the organization. Major contributors of this approach include

a) Henry Fayor (1841-1925)

b) Chesta Barnard (1886-1961)

Fayor attempted to isolate main types of activities in industry and business. Within
the category of managerial activities, he identified five major functions; planning,
organizing, commanding, co-ordinating and controlling.

Thinking of management as encompassing these functions are known as functional

approach to management. Fayor came out with some general principles of
management.

Fayor’s General Principles of Management

a) Division of work: Work specialization can result in efficiency and is
applicable to both managerial and technical functions. Yet there are
limitations to how much that money could be divided.
b) Authority: It is the right given or orders and the power to exact obedience. It
derives from the formal authority from the office and from personal
authority base on factors like intelligence and experience. With authority
comes responsibility. Authority is simply the legitimate power to perform a
responsibility. Responsibility is simply the obligation to perform a duty.
c) Discipline: This is absolutely necessary for the smooth running of an
organization. Discipline is simply codes of conduct that a group of people
must observe. But the state of discipline essentially depends on the
worthiness of its leaders.
d) Unity of Command: This means an employee should receive orders or
command from one superior person.
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e) Unity of Direction: Activities aimed at the same objectives should be
organized so that there is one plan and one person in charge.
f) Subordination of Individual Interest to General Interest: The interest of one
employee or a group should not prevail over the interest and goals of the
organization.
g) Remuneration: Compensation should be fair to both employees and
employers. Remuneration is simply reward for work done.
h) Centralization and Decentralization: The proper amount of centralization
and decentralization depends on the situation. The objective is the optimum
use of the capabilities of personnel.
i) Scalar Chain: A Scalar (hierarchical) chain of authority extends from the top
to bottom of an organization and define the communication path. However,
the horizontal communication also encourage as long as the managers in the
chain are kept informed.
j) Order: Materials should be kept in well chosen places that facilitate
activities. Similarly, due to good organization and selection. The right
person should be in the right place.
k) Equity: Employees should be treated with kindness, fairness and justice.
l) Stability of personnel tenure: To attain the maximum productivity of
personnel, a stable workforce is needed. Since time is required to become
effective in new jobs, high turnover should be prevented.
m) Initiatives: Managers should be encouraging and develop subordinates’
initiatives to the fullness
n) Espirit de Corps: Since union is strength, harmony and team work are
essential.

Chester Barnard: He was president of New Jersey Bell Telephone Company

introduced the idea of the informal organization. He felt that these informal
organizations provide necessary and vital communication functions for the
overall organization and that they could help the organization accomplish its
goals. Barnard felt that it was particularly important for managers to develop a
sense of common purpose where a willingness to cooperate is strongly
encouraged. He is credited with developing the Acceptance Theory of
Management, which emphasizes the willingness of employees to accept that

29
 managers have legitimate authority to act. Barnard felt that four factors affected
the willingness of employees to accept authority;
a) The employees must understand the communication.
b) The employees accept the communication as being consistent with
organization’s purposes.
c) The employees feel that their actions will be consistent with the needs
and desires of the other employees.
d) The employees feel that they are mentally and physically able to carry
out the order.

Barnard’s sympathy for and understanding of employee needs positioned him as a

bridge to the behavioral school of management.

Bureaucratic Model/Management Approach

This is the approach that emphasizes the need for an organization to operate in a
rational manner rather than relying on arbitrary whims of owners and managers.
This approach is based mainly on the work of prominent sociologist Max Weber
(1864-1920).
In formulating this idea, Max Weber was reacting to the prevailing norms of class
consciousness and nepotism. He disliked the way many European organizations
were managed on a “personal” family-like basis and that employees were loyal to
individual supervisors rather than to the organization. He believed that
organizations should be managed impersonally and that a formal organizational
structure, where specific rules were followed, was important.

He also believed that running organization on the basis of whom one knows rather
than what one knows and engaging in nepotism turn to interfere organizations
effectiveness. In an attempt to visualize Weber formulated features/characteristics
of the ideal bureaucracy. He coined the word bureaucracy to identify large
organizations that operate on rational basis.
Major Characteristics of Weber’s ideal Bureaucracy

Characteristics Description
Division of Labour and Specialization Jobs are broken down into routine well
defined task so that members know
30
 what is expected of them and become
extremely competent in their particular
subset of task.
Formal Rules and Regulations Standard operating procedures govern
all organizational activities to provide
certainty and facilitate coordination.
Well-defined hierarchy All positions within a bureaucracy are
structured in a way that permits the
higher positions to supervise the lower
positions. This clear chain of command
facilitates control and order throughout
the organization.
Impersonal Relationship between Managers should maintain an
Managers and Subordinates impersonal relationship with employees
so that favoritism and personal prejudice
do not influence decisions.
Competence Selection and promotion is based on the
qualification and performance of
members.
Records A bureaucracy needs to maintain
complete files regarding all its activities.

LECTURE THREE: BEHAVIORAL MANAGEMENT THEORY

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Behavioral Management Theory:

a) The contributions of the early behavioral.

b) The Hawthorne studies
c) The human relation movement
d) The more contemporary behavioral science approach:
 Quantitative
 Systems
 Contingency

BEHAVIORAL MANAGEMENT THEORY

This is a perspective that emphasis the importance of attempting to understand the
various factors that affect human behavior in organization. In short, the classical
theory ignored employee motivation and behavior. As a result, the behavioral
school was a natural outgrowth of this revolutionary management experiment.
In exploring this viewpoint, we examine four (4) aspect of its development which
are:

e) The contributions of the early behavioral.

f) The Hawthorne studies
g) The human relation movement
h) The more contemporary behavioral science approach

The Early Behavioral

Two prominent of the early behavioral are:
a) Hago Munsterberg (1863-1916)
b) Mary Parker Follet (1868-1933)

Munsterberg contribution could be seen as his special interest in identifying the

conditions that will promote an individual’s conditions and individual best work
and find ways to influence workers to act in accordance with management interest,
conflict resolution and the integration of the organizational system were far in
advance of her time.

Follet place great importance in achieving what she called ‘Integration unity’
where by the organization would operate as a functional hole with the various
inter-related parts working together effectively to achieve organizational goals.

32
Hawthorne Studies
These are a group of studies conducted at Hawthorne works in Chicago of the
Western electricity company during the late 1920s and early 1930s
Three set of studies were done to establish their findings. One important outcome
of the studies was the identification of a famous concept that ultimately came to be
known as the Hawthorne effect.

The Hawthorne effect is the possibility that individuals singled out for a study may
improve their performers simply because of the added attention they receive rather
than any specific factors been tested in the study. As a result of the Hawthorne
study, the focus of the field of management was drastically changed. It led to the
human relation approach.

Human Relation Movement

Like Hawthorne research the human relation also emphasis the social dimension of
human behavior in an organization. The key to productivity from a managerial
point of view appears to lie in showing greater concern for workers so that they
will fill more satisfied with their jobs and be willing to produce more.
Consequently managers now need social skills. They also require better
understanding of how to make workers fill more satisfied with their jobs whiles the
Hawthorne studies provided some clues managers need more definitive guidance.
Two main theories, Abraham Maslow and Douglas McGregor were among those
who came forward with ideas that managers found helpful.
Abraham Maslow, a practicing Psychologist, developed a theory of motivation that
was base on three assumptions about human nature.

A. Human needs are never completely satisfied.

B. Human behavior is purposeful and is motivated by the need for satisfaction
C. Needs can be classified according to a hierarchical structure of importance
from the lowers to the higher.

The hierarchy outline by Maslow has five levels of needs namely;

A. Physiological needs (Food, Cloth and Shelter )

33
 B. Safety needs: These needs include the need for basic security, stability,
protection and freedom from fear. A normal state exists for an individual to
have all these needs generally satisfied. Otherwise, they become primary
motivators
C. Belonging and love needs; After the physical and safety needs are satisfy
and are no longer motivator, the need for belonging and love emerges as a
primary motivator. The individuals strives to establish meaningful
relationship with significant others.
D. Esteem Needs: An individual must develop self confidence and wants to
achieve status, reputation, fame and glory.
E. Self actualization needs: Assuming that all the previous needs in the
hierarchy needs are satisfied an individual feel a need to find himself i.e to
reach his potential.

Maslow’s work pointed out to managers that workers have needs beyond the basic
requirement of earning money to putting a roof over their head

Douglas McGregor also contributed very well to social or human dimension. He

develops the concept of theory X and theory Y. A dichotomy dealing with possible
assumption that managers make about workers. McGregor felt that such
assumptions exert a heavy influence on how managers operate.

Theory X managers turn to assume that workers are lazy and need to be forced,
they have little ambition and focus mainly on security needs. In contrast theory Y
managers assume that workers do not inherently dislike work, they are capable of
self control, they have the capacity to be creative and innovative and generally
have higher level needs that are often unmet on the job.

McGregor believes that managers who hold theory X assumption set up elaborate
controls and attempt to motivate strictly through economic incentives. As a result
workers are likely to respond in the manner that reinforces the manager’s original
assumption.

In contrast managers in theory Y assumptions have the potential of integrating

individual goal in organizational goals.

34
McGregor believes this integration could occur if managers give workers room in
performing their task, encouraging creativity and motivation, minimize the use of
controls and attempt to make the work more interesting and satisfied in regard to
higher levels needs. Under such conditions workers are likely to execute greater
commitment to organizational goal, because the goals coincide more closely with
their owns.

McGregor understood however that some relatively immature and dependent

workers might require greater control at first in order to develop the maturity need
for the theory Y approach.

Like Maslow hierarchy, McGregor theory X and Y approach help managers

develop a broader perspective in the nature of workers and new alternatives for
interacting with them.

Modern Management Theory

The contemporary view/Modern management theory is much more modern and
includes major advancement and innovation into the field of management. It is also
a bit more embracing.
The approaches of the modern management theory include:

a) Quantitative school of management

b) System Theory

c) Contingency Theory

Quantitative School of Management

During the World War II, Mathematicians, physicians and other scientist joined
together to solve military problems. The quantitative school of management is a
result of the research conducted during World War II. The quantitative approach to
management involves the use of quantitative techniques such as statistics, and
computer simulations to improve decision making. Some of the branches of this
school include:
a) Management Science: This school of thought emerged to treat the problems
associated with global warfare. This encourages managers to use statistics,
mathematics and other quantitative techniques to make management
decisions. Mangers can use computer models to figure out the best way to do

35
 something- saving both money and time. Mangers use several science
applications such as:

i) Mathematical forecasting which helps in making projections that are useful

in the planning process.

ii) Inventory modeling which helps in controlling inventories by

mathematically establishing how and when to order a product.

iii) Queuing theory which helps in allocating service personnel or

workstation to minimize customer waiting and service cost.

b) Operation Management: This is a narrow branch of the quantitative

approach to management. It focuses on managing the process of
transforming materials, labour and capital into useful goods and /or services.
The product outputs can be either goods or services. The resource inputs, or
factors of production include the wide variety of raw material, technologies,
capital, information, and people needed to create finished products. The
transformation process, in turn, is the actual set of operations or activities
through which various resources are utilized to produce finished goods or
services of value to customers or clients.

Operation management presently pays close attention to the demands of

quality, customer service, and competition. The process begins with
attention to the needs of customers: What do they want? Where do they want
it? Based on the answers to these questions, managers line up resources and
take any action necessary to meet customer expectation.

c) Management Information Systems (MIS): It is the most recent subfield of

the quantitative school. MIS organizes past, present and projected data from
both internal and external source and processes it into usable information,
which it then makes available to managers at all organization levels. The
information systems are also able to organize data into usable and acceptable
formats. As a result, managers can identify alternative quickly, evaluate
alternatives by using a spreadsheet program, pose a series of “what-if”
questions, and finally, select the best alternatives based on these questions.

Systems Theory

36
This is based on the notion that organizations can be visualized as systems. A
system is a set of interrelated part that operates as a whole in pursuance of
common goals. The system approach as applied to organization is based largely
on work in biology and the physical sciences.

Major Components a System

According to the system approach, an organization system has four main
components namely:
1. Input
2. Transformation
3. Output
4. Feedback
System View of an organization
Resources: Human, material, equipment, financial and informational.

Technical Abilities: Planning, organizing, leading, controlling and technology.

Outcome: Product and services, profit and losses and employment growth and
satisfaction.

Diagrammatic View of the System Approach

OUTPU
INPUT
T
TRANSFORMATIONAL
PROCESS

FEEDBACK FROM ENVIRONMENT

Input: Inputs are the various human, materials, financial, equipment and
informational resources require to produce goods and services.

37
 Transformational process: They are processes of the organization’s
managerial and technological abilities that are applied to convert input into
output.

Output: Outputs are the products, services and other outcomes produce by the
organization.

Feedback: It is the information about the results and organizational status

relative to the environment.

Advantages of the Systems theory

1. It can analyse systems at different levels.
2. The systems theory provides a frame work for accessing how well the various
part of an organization interact to achieve a common purpose.

3. It emphasize that a change in one part of the system may affect other parts. In
thinking about the interrelationships among us in an organization you might
visualize that the parts are interconnected by rubber bands.

4. The systems theory considers how an organization interacts with its

environment – the factors outside the organization that can affect its operations. In
order to consider the environment adequately an organization need to operate as an
open system.

Contingency School of Management

The contingency school of management can be summarized as an “it all depends”
approach. The appropriate management actions and approaches depend on the
situation. Managers with a contingency view use a flexible approach draw on a
variety of theories and experiences and evaluate many options as they solve
problems. Contingency theory recognizes that there is no one best way to manage.
In the contingency perspective, managers are faced with task of determining which
managerial approach is likely to be most effective in a given situation. For
example, the approach used to manage a group of people working in a restaurant
would be very different from the approach used to manage a group of people
working in Ghana Education Service. Contingency thinking avoids the classical
“one best way” arguments and recognizes the need to understand situational
differences and respond appropriately to them. It does not apply certain

38
management principles to any situation. Contingency theory is recognition of the
extreme importance individual manager performance in any given situation. The
contingency approach is highly dependent on the experience and judgment of the
manager in a given organizational environment.

Quality School of Management

The quality school of management is a comprehensive concept for leading and
operating an organization aimed at continually improving performance by focusing
on customers while addressing the needs of all stakeholders. In other words this
concept focuses on managing the total organization to deliver high quality to
customers. The quality school of management considers the following:
1. Organization Make up: Organizations are made up of complex systems of
customers and suppliers.

2. Quality of goods and services: meeting the customer’s requirements is a priority

goal and considered as a key to organizational survival and growth.

3. Continuous improvement in goods and services: Recognizing the need to

pinpoint internal and external requirements and continuously strive to improve.

4. Employees working in teams: these groups are primary vehicles for planning
and problem solving.

5. Developing openness and trust: confidence among members of the organization

at all levels is an important condition for success.

Management in the Future

Modern management approaches respect the classical, human resource and
quantitative approaches to management. However, successful managers recognize
that although each theoretical school has limitations in its application, each
approach also offer valuable insights that can broaden a manger’s opinions in
solving problems and achieving organizational goals.
Modern management approaches recognize that people are complex and variable.
Employees need change over time; people posses a range of talents and capabilities
that can be developed. Organizations and mangers, therefore should respond to
individuals with a wide variety of managerial strategies and opportunities.

39
Key themes to be considered as the twenty-first century progress:

1. The commitment to meet customer needs 100% guides organizations towards

quality management and continuous improvement of operation.

2. Today’s global economy is a dramatic influence on organizations and

opportunities abound to learn new ways of managing from practices in other
countries.

3. Organizations must reinvest in their most important asset (their people).

4. Mangers must excel in their relationship responsibilities to perform numerous

different roles.

LECTURE FOUR: PLANNING

Planning:
Meaning and purpose of planning; formal planning process; types of planning;

40
difference between strategic, tactical and operational planning.

Introduction
Planning is the first function of management. Planning makes decisions regarding
what to do, how to do, when to do, where to do and whom to do.
Planning is the process of thinking about and organizing the activities required to
achieve a desired goal. Planning involves the creation and maintenance of a plan.
As such, planning is a fundamental property of intelligent behavior. This thought
process is essential to the creation and refinement of a plan or integration of it with
other plans; that is, it combines forecasting of developments with the preparation
of scenarios of how to react to them. An important, albeit often ignored aspect of
planning, is the relationship it holds with forecasting. Forecasting can be described
as predicting what the future will look like, whereas planning predicts what the
future should look like.

Meaning of Planning
Deciding about all the aspect is called planning. A problem about taking decision
on these matters rises when there is more than one possible answer. Therefore it
can be said to be a process of choosing. Managers plan business activities at all
levels though more planning is required at top levels than lower levels. Business
organisations make long term planning, medium term and short term planning
upon the nature of their operations.

Definition of planning:

According to koontz and O’donnell,” Planning is deciding in advance What to do,

how to do it, when to do it, and who is to do it.”

According to Terry and Franklin “Planning is selecting information and making

assumptions regarding future to formulate activities necessary to achieve
organizational objectives”

Importance of planning
Planning is the first and most important function of the management. It is needed at
every level of the management. In the absence of planning all the business
activities of the organization will become meaningless. The importance of planning

41
has increased all the more in view of the increasing size of organizations. In the
absence of planning, it may not be impossible but certainly difficult to guess the
uncertain events of future.
1 Planning facilitates Decision making: Decision making means the process of
taking decision. Under it, a variety of alternatives are discovered and the best
alternative is chosen. But it is important to determine the objectives before the
discovery of alternatives. Objectives are determined under the process of planning.
So it can be said that planning facilitates decision making.

2 Planning reduce risk of Uncertainty: planning is always done for future and
future is uncertain. With the help of planning possible changes in future are
anticipated and various activities are planned in the best possible way.

3. Planning reduces overlapping and wasteful activities: Under planning, future

activities are planned in order to achieve objectives. The problems of when,
where ,what and almost decided. This puts an end to disorder. In such situation
coordination is established among different activities and departments. It puts an
end ot overlapping and wasteful activities.

4. Planning provides Direction: Under the process of planning the objectives of

the organization are defined in simple and clear words. The outcome of this is that
the entire employee’s important roles in the attainment of the objectives of the
organization are defined.

5. Planning establishes Standards for controlling: By determining the

objectives the objectives of the organisation through planning all the people
working in the organization and all the departments are informed about when, what
and how to do things. Standards are laid down about their work, time and cost.
Under controlling, at the time of completing the work, the actual work done is
compared with the standard work and deviations are found out and if the work has
been done as desired the person concerned are held responsible.

6. Development of managers: Planning involves imagination, thought and

creativity by managers. While planning, managers develop their conceptual and
analytical skill to coordinate organizational activities with external environment.

42
7. Moral boost up: If organizational plans succeed and goals are achieved,
employees feel satisfied and morally boost up to further concentrate on activities.

8. Stability to Organization: Organizations that plan their operation are more

stable than others. Managers foresee risk and prepare their organisations to face
them when they occur.

FORMAL PLANNING PROCESS

Establish Goals

The first step of the management planning process is to identify specific company
goals. This portion of the planning process should include a detailed overview of
each goal, including the reason for its selection and the anticipated outcomes of
goal-related projects. Where possible, objectives should be described in
quantitative or qualitative terms. An example of a goal is to raise profits by 25
percent over a 12-month period.

Identify Resources

Each goal should have financial and human resources projections associated with
its completion. For example, a management plan may identify how many sales
people it will require and how much it will cost to meet the goal of increasing sales
by 25 percent.

Establish Goal-Related Tasks

Each goal should have tasks or projects associated with its achievement. For
example, if a goal is to raise profits by 25 percent, a manager will need to outline
the tasks required to meet that objective. Examples of tasks might include
increasing the sales staff or developing advanced sales training techniques.

Prioritize Goals and Tasks

Prioritizing goals and tasks is about ordering objectives in terms of their

importance. The tasks deemed most important will theoretically be approached and
completed first. The prioritizing process may also reflect steps necessary in
completing a task or achieving a goal. For example, if a goal is to increase sales by
25 percent and an associated task is to increase sales staff, the company will need
to complete the steps toward achieving that objective in chronological order.

43
Create Assignments and Timelines

As the company prioritizes projects, it must establish timelines for completing

associated tasks and assign individuals to complete them. This portion of the
management planning process should consider the abilities of staff members and
the time necessary to realistically complete assignments. For example, the sales
manager in this scenario may be given monthly earning quotas to stay on track for
the goal of increasing sales by 25 percent.

Establish Evaluation Methods

A management planning process should include a strategy for evaluating the

progress toward goal completion throughout an established time period. One way
to do this is through requesting a monthly progress report from department heads.

Identify Alternative Courses of Action

Even the best-laid plans can sometimes be thrown off track by unanticipated
events. A management plan should include a contingency plan if certain aspects of
the master plan prove to be unattainable. Alternative courses of action can be
incorporated into each segment of the planning process, or for the plan in its
entirety.

TYPES OF PLANING

I. Strategic Plan

A strategic plan is a high-level overview of the entire business, its vision,

objectives, and value. This plan is the foundational basis of the organization and
will dictate decisions in the long-term. The scope of the plan can be two, three,
five, or even ten years.

Managers at every level will turn to the strategic plan to guide their decisions. It
will also influence the culture within an organization and how it interacts with
customers and the media. Thus, the strategic plan must be forward looking, robust
but flexible, with a keen focus on accommodating future growth.

The crucial components of a strategic plan are:

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1. Vision

Where does the organization want to be five years from now? How does it want to
influence the world?

These are some of the questions you must ask when you delineate your
organization’s vision. It’s okay if this vision is grandiose and idealistic. If there is
any room to wax poetic within a plan, it is here. Holding ambitions to “make a dent
in the Universe” (Apple/Steve Jobs) is acceptable, as is a more realistic vision to
create the most “customer-centric company on Earth” (Amazon).

2. Mission

The mission statement is a more realistic overview of the company’s aim and
ambitions. Why does the company exist? What does it aim to achieve through its
existence? A clothing company might want to “bring high street fashion to the
masses”, while a non-profit might want to “eradicate polio”.

3. Values

Your values are the things that you believe are important in the way you live and
work. Values exist, whether you recognize them or not. Life can be much easier
when you acknowledge your values – and when you make plans and decisions that
honor them.

If you value family, but you have to work 70-hour weeks in your job, will you feel
internal stress and conflict? And if you don't value competition, and you work in a
highly competitive sales environment, are you likely to be satisfied with your job?

In these types of situations, understanding your values can really help. When you
know your own values, you can use them to make decisions about how to live your
life, and you can answer questions like these:

 What job should I pursue?

 Should I accept this promotion?
 Should I start my own business?
 Should I compromise, or be firm with my position?
 Should I follow tradition, or travel down a new path?

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II. Tactical Plan

The tactical plan describes the tactics the organization plans to use to achieve the
ambitions outlined in the strategic plan. It is a short range (i.e. with a scope of less
than one year), low-level document that breaks down the broader mission
statements into smaller, actionable chunks. If the strategic plan is a response to
“What?”, the tactical plan responds to “How?”.

Creating tactical plans is usually handled by mid-level managers.

The tactical plan is a very flexible document; it can hold anything and everything
required to achieve the organization’s goals. That said, there are some components
shared by most tactical plans:

1. Specific Goals with Fixed Deadlines

Suppose your organization’s aim is to become the largest shoe retailer in the city.
The tactical plan will break down this broad ambition into smaller, actionable
goals. The goal(s) should be highly specific and have fixed deadlines to spur action
– expand to two stores within three months, grow at 25% per quarter, or increase
revenues to $1mn within six months, and so on.

2. Budgets

The tactical plan should list budgetary requirements to achieve the aims specified
in the strategic plan. This should include the budget for hiring personnel,
marketing, sourcing, manufacturing, and running the day-to-day operations of the
company. Listing the revenue outflow/inflow is also a recommended practice.

3. Resources

The tactical plan should list all the resources you can muster to achieve the
organization’s aims. This should include human resources, IP, cash resources, etc.
Again, being highly specific is encouraged.

46
4. Marketing, Funding, etc.

Finally, the tactical plan should list the organization’s immediate marketing,
sourcing, funding, manufacturing, retailing, and PR strategy. Their scope should be
aligned with the goals outlined above.

If you’re struggling to create a strong tactical plan, this course on drafting great
business plans will point you in the right direction.

III. Operational Plan

The operational plan describes the day to day running of the company. The
operational plan charts out a roadmap to achieve the tactical goals within a realistic
timeframe. This plan is highly specific with an emphasis on short-term objectives.
“Increase sales to 150 units/day”, or “hire 50 new employees” are both examples
of operational plan objectives.

Creating the operational plan is the responsibility of low-level managers and

supervisors.

Operational plans can be either single use, or ongoing, as described below:

1. Single Use Plans

These plans are created for events/activities with a single occurrence. This can be a
one-time sales program, a marketing campaign, a recruitment drive, etc. Single use
plans tend to be highly specific.

2. Ongoing Plans

These plans can be used in multiple settings on an ongoing basis. Ongoing plans
can be of different types, such as:

 Policy: A policy is a general document that dictates how managers should

approach a problem. It influences decision making at the micro level.
Specific plans on hiring employees, terminating contractors, etc. are
examples of policies.
 Rule: Rules are specific regulations according to which an organization
functions. The rules are meant to be hard coded and should be enforced
stringently. “No smoking within premises”, or “Employees must report by 9
a.m.”, are two examples of rules.
47
  Procedure: A procedure describes a step-by-step process to accomplish a
particular objective. For example: most organizations have detailed
guidelines on hiring and training employees, or sourcing raw materials.
These guidelines can be called procedures.

Ongoing plans are created on an ad-hoc basis but can be repeated and changed as
required.

Operational plans align the company’s strategic plan with the actual day to day
running of the company. This is where the macro meets the micro.

Differences Between Strategic, Tactical and Operations Planning

Strategic Planning: Refers to the process through which an organization defines its
strategy, allocate its resource and lead the direction that the company will follow to
achieve its goals.

Strategic Planning is the formal planning for the future and help the company to
define:

What we do?

For whom we do it?

How do we successes?

Tactical Planning: Refers to the process of taking the strategic plan and divided
into specific activities, short term actions and plans to achieve the planned
objectives.

Operations Planning: Refers to the action plan for the day-to-day functioning of an
organization. It defines the short term methods to achieve the strategic objectives
set while strategic planning is done. In other words, Operation planning allows the
company to determine how to do it.

How can corporate governance support ethical strategic decisions?

Corporate governance should support ethical strategic decision base on:

48
Guarantee that shareholder’s interest will be serve, as well product market
shareholders and organizational stakeholders.

49
LECTURE FIVE: DECISION MAKING

Decision Making:
Nature and purpose of decision making; decision making process; techniques used
in decision making process.

Meaning of decision

To decide means to come to some definite conclusion for follow-up action.

Decision is a choice from among a set of alternatives. The word 'decision' is
derived from the Latin words de ciso which means 'a cutting away or a cutting off
or in a practical sense' to come to a conclusion. Decisions are made to achieve
goals through suitable follow-up actions. Decision-making is a process by which a
decision (course of action) is taken.

According to Peter Drucker, "Whatever a manager does, he does through decision-

making". A manager has to take a decision before acting or before preparing a plan
for execution. Moreover, his ability is very often judged by the quality of decisions
he takes. Thus, management is always a decision-making process. It is a part of
every managerial function. This is because action is not possible unless a firm
decision is taken about a business problem or situation.

This clearly suggests that decision-making is necessary in planning, organising,

directing, controlling and staffing. For example, in planning alternative plans are
prepared to meet different possible situations. Out of such alternative plans, the
best one (i.e., plan which most appropriate under the available business
environment) is to be selected. Here, the planner has to take correct decision. This
suggests that decision-making is the core of planning function. In the same way,
decisions are required to be taken while performing other functions of management
such as organising, directing, staffing, etc. This suggests the importance of
decision-making in the whole process of management.

The effectiveness of management depends on the quality of decision-making. In

this sense, management is rightly described as decision-making process. According
to R. C. Davis, "management is a decision-making process." Decision-making is an
intellectual process which involves selection of one course of action out of many

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alternatives. Decision-making will be followed by second function of management
called planning. The other elements which follow planning are many such as
organising, directing, coordinating, controlling and motivating.

Definition

 The Oxford Dictionary defines the term decision-making as "the action of

carrying out or carrying into effect".
 According to Trewatha & Newport, "Decision-making involves the selection
of a course of action from among two or more possible alternatives in order
to arrive at a solution for a given problem."

Decision making is the mental process resulting in the selection of a course of

action among several alternatives. Every decision making process produces a final
choice in an action or an opinion of choice. If a person neither takes an action nor
gives an opinion, this is also decision.

Purpose of decision making

1. Implementation of managerial function: Without decision making different
managerial function such as planning, organizing, directing, controlling, staffing
can’t be conducted. In other words, when an employee does, s/he does the work
through decision making function. Therefore, we can say that decision is important
element to implement the managerial function.

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2. Pervasiveness of decision making: the decision is made in all managerial
activities and in all functions of the organization. It must be taken by all staff.
Without decision making any kinds of function is not possible. So it is pervasive.

3. Evaluation of managerial performance: Decisions can evaluate managerial

performance. When decision is correct it is understood that the manager is
qualified, able and efficient. When the decision is wrong, it is understood that the
manager is disqualified. So decision making evaluate the managerial performance.

4. Helpful in planning and policies: Any policy or plan is established through

decision making. Without decision making, no plans and policies are performed. In
the process of making plans, appropriate decisions must be made from so many
alternatives. Therefore decision making is an important process which is helpful in
planning.

5. Selecting the best alternatives: Decision making is the process of selecting the
best alternatives. It is necessary in every organization because there are many
alternatives. So decision makers evaluate various advantages and disadvantages of
every alternative and select the best alternative.

6. Successful; operation of business: Every individual, departments and

organization make the decisions. In this competitive world; organization can exist
when the correct and appropriate decisions are made. Therefore correct decisions
help in successful operation of business.

Relationship Between Planning and Decision-making

There is close relationship between planning and decision-making. Decision-
making has priority over planning function. It is the starting point of the whole
management process. In fact, decision-making is a particular type of planning. A
decision is a type of plan involving commitment to resources for achieving specific
objective. According to Peter Drucker, it is the top management which is
responsible for all strategic decisions such as the objectives of the business, capital
expenditure decisions as well as operating decisions such as training of manpower
and so on. Without management decisions, no action can take place and naturally
the resources would remain idle and unproductive. The managerial decisions
should be correct to the maximum extent possible. For this, scientific decision-
making is essential.

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Steps Involved In Decision Making Process
Decision-making involves a number of steps which need to be taken in a logical
manner. This is treated as a rational or scientific 'decision-making process' which is
lengthy and time consuming. Such lengthy process needs to be followed in order to
take rational/scientific/result oriented decisions. Decision-making process
prescribes some rules and guidelines as to how a decision should be taken / made.
This involves many steps logically arranged. It was Peter Drucker who first
strongly advocated the scientific method of decision-making in his world famous
book 'The Practice of Management' published in 1955. Drucker recommended the
scientific method of decision-making which, according to him, involves the
following six steps:
1. Defining / Identifying the managerial problem,
2. Analyzing the problem,

3. Developing alternative solutions,

4. Selecting the best solution out of the available alternatives,

5. Converting the decision into action, and

6. Ensuring feedback for follow-up.

The figure given below suggests the steps in the decision-making process:-

53
1. Identifying the Problem: Identification of the real problem before a
business enterprise is the first step in the process of decision-making. It is
rightly said that a problem well-defined is a problem half-solved.
Information relevant to the problem should be gathered so that critical
analysis of the problem is possible. This is how the problem can be
diagnosed. Clear distinction should be made between the problem and the
symptoms which may cloud the real issue. In brief, the manager should
search the 'critical factor' at work. It is the point at which the choice applies.
Similarly, while diagnosing the real problem the manager should consider
causes and find out whether they are controllable or uncontrollable.
2. Analyzing the Problem: After defining the problem, the next step in the
decision-making process is to analyze the problem in depth. This is
necessary to classify the problem in order to know who must take the
decision and who must be informed about the decision taken. Here, the
following four factors should be kept in mind:

1. Futurity of the decision,

2. The scope of its impact,

3. Number of qualitative considerations involved, and

4. Uniqueness of the decision.

Collecting Relevant Data: After defining the problem and analyzing its
nature, the next step is to obtain the relevant information/ data about it.
There is information flood in the business world due to new developments in
the field of information technology. All available information should be
utilised fully for analysis of the problem. This brings clarity to all aspects of
the problem.
3. Developing Alternative Solutions: After the problem has been defined,
diagnosed on the basis of relevant information, the manager has to determine
available alternative courses of action that could be used to solve the
problem at hand. Only realistic alternatives should be considered. It is
equally important to take into account time and cost constraints and
psychological barriers that will restrict that number of alternatives. If

54
 necessary, group participation techniques may be used while developing
alternative solutions as depending on one solution is undesirable.
4. Selecting the Best Solution: After preparing alternative solutions, the next
step in the decision-making process is to select an alternative that seems to
be most rational for solving the problem. The alternative thus selected must
be communicated to those who are likely to be affected by it. Acceptance of
the decision by group members is always desirable and useful for its
effective implementation.

5. Converting Decision into Action: After the selection of the best decision,
the next step is to convert the selected decision into an effective action.
Without such action, the decision will remain merely a declaration of good
intentions. Here, the manager has to convert 'his decision into 'their decision'
through his leadership. For this, the subordinates should be taken in
confidence and they should be convinced about the correctness of the
decision. Thereafter, the manager has to take follow-up steps for the
execution of decision taken.

6. Ensuring Feedback: Feedback is the last step in the decision-making

process. Here, the manager has to make built-in arrangements to ensure
feedback for continuously testing actual developments against the
expectations. It is like checking the effectiveness of follow-up measures.
Feedback is possible in the form of organised information, reports and
personal observations. Feed back is necessary to decide whether the decision
already taken should be continued or be modified in the light of changed
conditions.

Every step in the decision-making process is important and needs proper

consideration by managers. This facilitates accurate decision-making. Decision-
making is important as it facilitates entire management process. Management
activities are just not possible without decision-making as it is an integral aspect of
management process itself. However, the quality of decision-making should be
always superior as faulty/irrational decisions are always dangerous.

55
Main Techniques of Decision-making

Decision taken must be accurate and should not lead to confusion; the decisions
taken must also be scientific and available for accuracy and verification. The
important techniques that aid the manager in decision making are operations
research and other quantitative techniques.

1. Operations Research:

Definition:"Operations Research is the application of methods of science to

complex problems arising in the direction and management of large system of men,
machines, materials and money in industry, business, government and defense".

Robert Thierauf:

"Operations Research utilized the planned approach and an interdisciplinary team

in order to represent functional relationships as mathematical models for the
purpose of providing a quantitative basis for decision making and uncovering new
problems for quantitative analysis".

Operations Research helps the decision maker to make objective decisions. OR

does this by providing factual basis to guide and support judgment, easing the
burden of effort and time on the executive.

Operations Research is a particular way of viewing the problem, team, task force
and mathematical reasoning to the alternatives meant for solving them. The
common approach in any operations research is the construction and study of a
mathematical model.

Some of the managerial problems usually subjected to operations research analysis

include production scheduling, inventory control, sales policies, expansion of plant
etc.

Management accountant holds key for the ultimate success or failure of operations
research. The quality of decision making will improve with the application of
mathematical model but the feasibility of a mathematical model application will

56
depend on the adequacy and accuracy of accounting information. (More details on
OR at the later pages of this chapter).

2. Models:

Model building is the central concept in the application of OR while making use of
quantifying models. Models are simple convenient and relatively economic
resource conservation device for testing hypothesis.

Mathematical models help the optimization concept in decision making. This is

very important in the calculation and choice of best possible alternative solutions
for a given problem.

3. Simulation:

This technique is used to test the feasibility and possible outcome of various
decision alternatives. "Simulation is a quantitative technique for evaluating
alternative courses of action based upon facts and assumptions with a
computerized mathematical model in order to represent actual decision making
under conditions of uncertainty.

4. Linear Programming:

This is defined as "How could a company with limited resources make optimum
use with their resources, combination for the achievement of the desired objective,
or goal was, the central idea of this mathematical technique".

A linear or straight line relationship exists between variables and that the limits of
variation can be determined. It adopts an analytical instead of intuitive approach in
decision making. It is also concerned with problem of planning. A group of
complex independent activities are expressed by means of developing
mathematical formula.

5. Games Theory: Games theory attempts to work out optimum solution in which
an individual in a given situation can develop a strategy irrespective of what a
competition does with maximizing gains or minimizing losses. It involves
mathematical study of tactics under conditions of uncertainty.

57
6. PERT and CPM: Programme Evaluation and Review Technique is useful to
analyze and control the timing aspects of programmes. In planning and controlling
a programme, PERT helps in obtaining lower costs and reducing programme time,
bringing about better utilization of human and physical resources.

Critical Path Method (CPM) is a commonly used term for all network analysis and
for a particular version of these techniques.

PERT relies on three estimates, an optimistic, most likely and pessimistic of the
time each activity may take. CPM relies only one 'most likely'.

7. Probability Theory Analysis: Probability refers to a chance that a particular

event will occur. The events must be random and be effected by chance and not by
design. The probability of success is defined as the number of successful outcomes
divided by the total number of outcomes. It cannot be denied that some element of
probability does exist in all decision making.

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LECTURE SIX: LEADERSHIP

Leadership:
Meaning of Leadership; management style; management style and organizational
effectiveness.

There are many definitions of leadership. Many lines have been written attempting
to capture the essence of leadership in just a few words.

Leadership Definitions

"Leadership is a function of knowing yourself, having a vision that is well

communicated, building trust among colleagues, and taking effective action to
realize your own leadership potential." (Warren Bennis).

"Leadership defines what the future should look like, aligns people with that vision
and inspires them to make it happen despite the obstacles." (John Kotter).

"The art of mobilising others to want to struggle for shared aspirations." (James
Kouzes and Barry Posner).

"Leadership is a process that involves: setting a purpose and direction which

inspires people to combine and work towards willingly; paying attention to the
means, pace and quality of progress towards the aim; and upholding group unity
and individual effectiveness throughout." (James Scouller).

A leadership definition is obviously quite limited because it's only a few words or
a couple of sentences.

Some definitions of leadership convey a particular essence of leadership very well,

but that is all a single definition can represent - just an essence.

Any single definition of leadership can only attempt to convey the essence or most
important quality of leadership from a particular standpoint or point of view.

59
Therefore when we try to understand leadership we should avoid placing too
much reliance on a single definition, or even several definitions of leadership,
and especially when we try to explain leadership to others.

Definitions of leadership do not explain leadership - leadership definitions can

at best merely convey the essence of leadership from a particular point of view.

To understand, explain, and apply leadership, we must be able to describe

leadership in greater depth.

Types of Management Styles

Several management styles have evolved hitherto as distinct managers utilized
differing approaches in performing responsibilities in the course of their official
work. Sequel to the emergence of styles of management
,scholars have identified and described a variety of formal styles of management
since the 1950’s. Likert (1967) classified four approaches of management that
constitute a continuum of participative, paternalistic, exploitative and autocrative,
and consultative management style while Burn and Stalker (1961) identified
organic and mechanistic styles of management. Furthermore, Minzberg (1973)
considered entrepreneurial and strategic planning as forms of management styles
adopted by managers in organizational entities. In recent times, commonly
exhibited styles of management includes authoritarian, coercive, authoritative,
democratic, affiliative, permissive, indifferent, coaching, pacesetting, visionary,
bureaucratic and defensive styles of management (Effere, 2005).

Different Management Styles

1. Autocratic Style of Working
 In such a style of working, the superiors do not take into consideration
the ideas and suggestions of the subordinates.
 The managers, leaders and superiors have the sole responsibility of
taking decisions without bothering much about the subordinates.
 The employees are totally dependent on their bosses and do not have
the liberty to take decisions on their own.
 The subordinates in such a style of working simply adhere to the
guidelines and policies formulated by their bosses. They do not have
a say in management’s decisions.

60
  Whatever the superiors feel is right for the organization eventually
becomes the company’s policies.
 Employees lack motivation in autocratic style of working.

2. Paternalistic Style of Working

 In paternalistic style of working, the leaders decide what is best for
the employees as well as the organization.
 Policies are devised to benefit the employees and the organization.
 The suggestions and feedback of the subordinates are taken into
consideration before deciding something.
 In such a style of working, employees feel attached and loyal towards
their organization.
 Employees stay motivated and enjoy their work rather than treating it
as a burden.
3. Democratic Style of Working
 In such a style of working, superiors welcome the feedback of the
subordinates.
 Employees are invited on an open forum to discuss the pros and cons
of plans and ideas.
 Democratic style of working ensures effective and healthy
communication between the management and the employees.
 The superiors listen to what the employees have to say before
finalizing on something.
4. Laissez-Faire Style of Working
 In such a style of working, managers are employed just for the sake
of it and do not contribute much to the organization.
 The employees take decisions and manage work on their own.

61
  Individuals who have the dream of making it big in the organization
and desire to do something innovative every time outshine others who
attend office for fun.
 Employees are not dependent on the managers and know what is
right or wrong for them.
5. Management by Walking Around Style of Working
 In the above style of working, managers treat themselves as an
essential part of the team and are efficient listeners.
 The superiors interact with the employees more often to find out
their concerns and suggestions.
 In such a style of working, the leader is more of a mentor to its
employees and guides them whenever needed.
 The managers don’t lock themselves in cabins; instead walk around to
find out what is happening around them.

The relationship between management styles and organizational effectiveness

cannot be overemphasized. Management styles are one of the important factors
that affect organizational effectiveness. A good match between the style of
management and operating realities of an organization will substantially influence
its level of effectiveness. In each organization, management style influences the
performance of individual employee and work groups, and thereby the whole
organization’s performance.

Leadership Vs Management

Key word Leadership Management

Management comprises
Leadership means "the
directing and controlling a
Definition ability of an individual to
group of one or more
influence, motivate, and
people or entities for the
enable others to
purpose of coordinating and
contribute toward the
harmonizing that group
effectiveness and success
towards accomplishing a
62
 goal.
of the organizations of
which they are
members."

Personality Styles Are often called brilliant Tend to be rational, under

and mercurial, with great control problem solvers.
charisma. Yet, they are They often focus on goals,
also often seen as loners structures, personnel, and
and private people. They availability of resources.
are comfortable taking Managers’ personalities
risks, sometimes lean toward persistence,
seemingly wild and crazy strong will, analysis, and
risks. Almost all leaders intelligence
have high levels of
imagination
Focus Leading people Managing work

Outcomes Achievements Results

Approach to tasks Simply look at problems
Create strategies, policies,
and devise new, creative
and methods to create
solutions. Using their
teams and ideas that
charisma and
combine to operate
commitment, they excite,
smoothly. They empower
motivate, and focus
people by soliciting their
others to solve problems
views, values, and
and excel.
principles. They believe
that this combination
reduces inherent risk and
generates success
Approach to risk
Risk-taking Risk-averse

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Role in decision-
Facilitative Involved
making

Styles Transformational, Dictatorial,

Consultative & Authoritative,Transactional
Participative , Autocratic, Consultative
and Democratic

Power through Charisma & Influence Formal authority &

Position
Leaders have followers Managers have
Organization
subordinates

Appeal to Heart Head

LECTURE SIX: MOTIVATION

Leadership:
Meaning of motivation; content and process theories of motivation.

Motivation
Some people are found to be more efficient than others. The difference in their
performance can be attributed either to their urge or willingness to perform as best
as possible or difference in their abilities. Omitting the ability and skill, it is the
motive of employees which determines whether they will be more or less efficient.
Motivation, the bringing about an inner urge or desire in employees to work to the
best of their ability is an important function of management.

Concept of Motivation
Motivation may be defined as the complex forces inspiring a person at work to
intensify his willingness to use his maximum capabilities for the achievement of
certain objectives. In other words, motivation is something that motivates a person
into action and induces him to continue in the course of action enthusiastically. At

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the work, it determines the behavior of a person.

Dalton E. McFarland defines motivation as: Motivation refers to the way in which
urges, desires, drives, striving, aspirations, or needs direct, control or explain the
behavior of human being".

The term 'motivation' is derived from the word 'motive'. Motive may be defined as
wants, drives, needs or impulses within the individual. Motives are personal and
internal because it is an expression of a person's needs. The term 'need' should not
be associated with pressing desire or urgency for something. Simply it means
something within an individual that prompts him to action. Behavior of a person
starts from this needs or motives. These needs and motives start and maintain
activity and eventually it determine the direction of a person. These motives give
direction to human behavior because they are directed towards certain 'goals'
which may be conscious or sub-conscious.

The starting points in the motivation process are motives or needs of a person.
Motives are directed towards the achievement of certain goals which in turn
determine the behaviour of individuals. This behaviour ultimately leads to goal
directed activities such as preparing food and a goal activity such as eating food.
Unsatisfied needs result in tension within an individual and engage him search for
the way to relieve this tension. He will develop certain goals for himself and try to
achieve them. If he is successful in his attempt, certain other needs will emerge
which will lead to setting a new goal. But if he is unsuccessful he will engage
himself in either constructive or defensive behavior. This process keeps on
working within an individual.

Theories of Motivation

The Content Theories of Motivation

In a historical perspective, the content theories tend to be the earliest theories of
motivation or later modifications of early theories. Within the work environment
they have had the greatest impact on management practice and policy, whilst
within academic circles they are the least accepted.

Content theories are also called needs theories, because they are generally
associated with a view that concentrates on the importance of determining 'what'

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motivates us. In other words they try to identify what our 'needs' are and relate
motivation to the fulfilling of these needs.

 Maslows Hierarchy of Needs

 "Management Assumptions" (Theory X and Theory Y)
 ERG Theory
 McClellands Need for Achievement, Affiliation and Power
 Herzbergs' Two Factor Theory

Maslows Hierarchy of Needs

This is the most widely known theory of motivation and was hypothesised by
American psychologist Abraham Maslow in the 1940s and 1950s. Maslow put
forward the idea that there existed a hierarchy of needs consisting of five levels in
the hierarchy. These needs progressed from lower order needs through to higher
level needs.

The basic premise of the theory is that we all have these five levels of needs and
that starting at the lowest level we are motivated to satisfy each level in ascending
order. As each level is sufficiently satisfied we are then motivated to satisfy the
next level in the hierarchy. The five different levels were further sub-categorised
into two main groups, these being:

Deficiency needs - Maslow considered these the very basic needs required for
survival and security. These needs include:

 physiological needs
 safety needs
 social needs

Growth needs - These are needs associated with personal growth and fullfilment
of personal potential.

 esteem needs
 self-actualisation needs

In Maslow's theory we can never run out of motivation because the very top level,
self-actualisation, which relates to the achievement of our full potential, can never
be fully met.

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"Management Assumptions" (Theory X and Theory Y)
Douglas McGregor further developed the needs concept of Maslow and
specifically applied it to the workplace. McGregor maintained that every manager
made assumptions about their employees and adopted a management approach
based upon these assumptions. He maintained there were two main categories and
that managers adopted one or the other.

The first category, which he termed Theory X, he maintained was the dominant
management approach and assumed:

 the average human being has an inherent dislike of work and will avoid it if
possible,
 because of this most people needed to be coerced, controlled, directed and
threatened with punishment to get them to put adequate effort into the
achievement of organisational objectives, and
 the average person prefers to be directed, wishes to avoid responsibility, has
very little ambition and wants security above all else.

McGregor maintains that the application of this approach, as well as

misunderstanding the real needs of employees, creates a self-fulfilling outcome
because it forces people to become like this—they have no alternative.

McGregor proposed an alternative set of assumptions which he called Theory Y.

The assumptions here are virtually the opposite to Theory X. They are :

 Work is as natural as play or rest.

 External control and threat of punishment are not the only means of bringing
about effort towards organisational objectives. People will exercise self-
direction and self-control towards the achievement of objectives they are
committed to.
 Commitment to objectives is a function of the rewards associated with their
achievement.
 The average person learns under proper conditions to not only accept
responsibility but also seek it.
 The ability to seek and develop innovative problem solving approaches is
widely, not narrowly distributed across the whole population.

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  In most work organisations the abilities of most employees is only partially
utilised.

McGregor advocated that the application of Theory Y, would not only meet the
needs of the organisation but also those of the employee. He believed that Theory
X at best only met Maslows Deficiency needs, whilst Theory Y also met the
Growth Needs. You would thus have more motivated employees if you adopted
Theory Y.
Maslows theory has been widely embraced and taught within the business world
and few people who have attended a company supervision or basic management
training course are unlikely not to be familiar with this theory.

ERG Theory
Clayton Alderfer revised Maslow's theory in 1972. He reduced the levels in the
hierarchy from five to three and termed these Existence needs, Relatedness needs
and Growth needs. His most significant contribution, however, was to alter
Maslow's concept of a one-way progression up the hierarchy, to one that allowed
for regression to lower levels if these needs are no longer being met. This is a more
realistic approach as it recognises that, because a need is met, does not mean it will
always remain met. For example, if I were to remove all the air from the room you
are in, would you be motivated to keep learning?

McClellands Need for Achievement, Affiliation and Power

David McClelland (Studies in Motivation, 1955) identified three basic types of
motivating needs present in people. He shows that all three needs can be present in
a person but the weight attached to each can vary. The three needs are:

(a) Need for achievement - where this is high then people have an intense desire to
succeed and an equally intense fear of failure.

(b) Need for affiliation - where this is high people tend to seek acceptance by
others, need to feel loved and are concerned with maintaining pleasant social
relationships.

(c) Need for power - people with a high need for power seek opportunities to
influence and control others, seek leadership positions and are often articulate,
outspoken and stubborn.

He further maintains that there is a direct link between high-performing managers

and their need for achievement, and to a lesser extent their need for power and

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affiliation. In other words, people with a high drive to succeed are more likely to
be more highly motivated than people with a low drive to succeed. He also
maintains that it is possible to arrange work situations and conditions to gain the
high motivational benefits from those with a high need for achievement—starting
by employing people with a high need for achievement.

Herzbergs' Two Factor Theory

Herzberg's theory has probably received the most attention within the workplace.
He developed a theory that differentiated between factors that satisfied employees,
and factors that dissatisfied employees. In his theory the opposite of 'satisfaction' is
not 'dissatisfaction' but rather 'no satisfaction'. Likewise, the opposite of
'dissatisfaction' is 'no dissatisfaction'.

Herzberg related job satisfaction to five factors:

 achievement
 recognition
 work itself
 responsibility
 advancement

He termed these factors 'motivators' and related them back to growth needs.

Herzberg related job dissatisfaction to:

 company policy and administration

 supervision
 salary
 interpersonal relationships
 working conditions

These he termed 'hygiene factors' and equated them with deficiency needs.

His major impact was to argue that providing hygiene factors (more money, better
working conditions, etc) would not create more motivation, only less
dissatisfaction. Only motivators could motivate.

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Criticism of the content theories
Despite their wide use and impact on the workplace, major criticisms exist of these
theories. Whilst specific criticisms can be leveled at particular theories, the
following general criticisms apply to all of the content theories.

 Universality - the theories pertain to be universal theories and apply to

everyone. They take no account of gender, age, culture, religious or other
factor differences. Most were developed in the USA and at best can only
represent middle-class Ameri can business needs and values in the 1940s to
1970s.
 Research support and methodology biases - despite many research
projects little to no support has been established for these theories. Many of
the theories, such as Maslow's, were not based on research at all, but
opinion, whilst others researched biased samples (only males, only
accountants and engineers, etc). In some instances where evidence was
found that did not support the theory, it was re-defined to make it fit.

 Work focus - the theories tend to assume that our workplaces are the places
(and only places) where our needs and personal development is met. They
ignore the importance of other aspects of our lives and their impact on our
work lives.

 Individual differences and stability over time - not only do the theories
ignore the significance of individual differences but they largely fail to
recognise that individual needs are constantly changing, and consequently
what may be a motivator one day may not the next. Their static nature
doesn't relate to the real world.

 Process simplicity - The theories assume that the connection between needs
and behaviour is non-problematic. They ignore the processes that must be
evaluated and implemented to achieve the desired end result. Overall they
are far too simplistic to account for the complexity of the real world and the
complex decision making process that individual must often make in the
motivation process.

Despite these criticisms, these theories have been critical in focusing attention on
the area of motivation and the importance of 'needs'. They have helped managers
evaluate their own perceptions about their employees and themselves. They have
also helped to provide a basis for further study in this area.

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The Process Theories of Motivation
Whereas the content theories concentrate on the question of 'what' motivates, the
process theories address more the issues relating to how the process works and
sustains itself over time, such as factors that determine the degree of effort, the
continuation of effort, the modification of effort, etc. As with content theory, there
are a number of process theories. These include:
 Equity theory
 Expectancy theory

 The Porter-Lawler Model

Adams’Equity theory
In this theory employee constantly assesses their level of effort against fellow
workers and the reward they receive for their effort. If they perceive there is a
significant difference between their level of effort and their fellow workers, they
will endeavour to bring about equality of effort for everyone—by adjusting up or
down their own performance or by taking measures to adjust the level of their
fellow workers. Likewise, the relative reward for effort is also monitored. The
message for managers is that employees need to be seen to be rewarded on a fair
and equitable basis, and inequities quickly adjusted.

Expectancy Theory
This has been an important theory in the history of the study of motivation.
Vroom’s expectancy theory highlights that motivation is partly a decision-making
process that evaluates effort for outcomes. It highlights the involvement of the
active cognitive processes and user choice in the process. It also highlights the
importance of the outcome representing a valued reward for the individual
involved.

The common themes in expectancy theories are:

 conscious decisions by individuals to behave in certain ways

 individual values with regard to choosing desired outcomes
 individual expectations concerning the amount of effort required to achieve
a specific outcome
 individual expectations concerning the probability of being rewarded for
achieving a desired outcome.
Motivation is a function of the relationship between:

 effort expended and perceived level of performance

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  the expectation that rewards (desired outcomes) will be related to
performance.

There must also be the expectation that rewards are available. These relationships
determine the
strength of the motivational link.
 the strength of the individual’s preference for an outcome
 the belief in the likelihood that particular actions will achieve the required
goal

This process may be illustrated in the following way:

Effort Required Outcome eg.

Performance Promotion

Force = Valence × Expectancy

 Force is strength of motivation.

 Valence is strength of preference for an outcome.
 Expectancy is the level of belief that changes in behaviour will achieve the
required outcome.

The recommendations to management that go with this model are outlined as

follows:

 Discover what outcome each employee values most.

 Define for employees the kinds of performance that are desired or required,
ie explain what constitutes a ‘goal’ and ‘adequate performance’.
 Ensure that the desired levels of performance are achievable.
 Link the outcomes desired by employees to the specific performance desired
by management.
 Ensure that the overall motivation strategy avoids conflict between the
positive expectations it seeks to create and other factors in the work
situation.
 Make sure that outcome or rewards are sufficiently attractive to motivate the
desired level of performance.
The Porter-Lawler Model
This model of motivation although based on the expectancy theory, is probably the
most complete theory of workplace motivation. It is an integrated approach that
includes elements of nearly all the other motivation theories. This is important as it
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helps explain why each of the various theories have contribution to make but also
serious limitations. If we consider each as part of a more complex model of
motivation this starts to make sense.

The model thus suggests that using individual theories will not work. A more
integrated approach is needed. It also differs from content theories, particularly
'two factor' theory, in suggesting that performance leads to job satisfaction, rather
than job satisfaction leading to performance

The complexity of the model, and the need to evaluate and provide valued rewards
on an individual basis, are practical limitations. However it is difficult to argue
with the process of the model. The area of motivation is complex and the model
highlights this—rather than presenting an unrealistically simple approach, as is the
case with many of the alternative theories.

Basically, Porter and Lawler’s model (shown below) shows that the amount of
effort generated depends upon: the value of the reward, the amount of effort seen
to be necessary, the probability of receiving the reward
The amount of effort deemed necessary and the probability of receiving the reward
are in turn influenced by the individual’s record of performance to date, and range
of skills, personality, perception of his role, and any number of other environment
factors.

Skills, Abilities
and Personality

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 Value for Reward

Performance
Effort

Probability of
achieving reward

Role Perception

Rewards may be:

(a) external rewards that are given by others and form part of the job situation (eg
wages, status, security)

(b) intrinsic rewards which the individual manager awards himself. These arise
from the performance of the tasks (eg feelings of self-esteem, accomplishment)

Organizational Control
Controlling is the process whereby managers monitor and regulate how efficiently
and effectively an organization and its members are performing the activities
necessary to achieve organizational goals.
In controlling, managers monitor and evaluate whether their organization’s
strategy and structure are working as intended, how they could be improved, and
how they might be changed if they are not working. Control involves keeping an
organization on track and anticipating events that might occur. It is also involved
with keeping employees motivated, focused upon important problems facing the
organization, and working together to take advantage of opportunities.

Types of Control

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Management can implement controls before an activity commences, while the
activity is going on, or after the activity has been completed. The three respective
types of control based on timing are feedforward, concurrent, and feedback.

Feedforward Control
Feedforward control focuses on the regulation of inputs (human, material, and
financial resources that flow into the organization) to ensure that they meet the
standards necessary for the transformation process.

Feedforward controls are desirable because they allow management to prevent

problems rather than having to cure them later. Unfortunately, these controls
require timely and accurate information that is often difficult to develop.
Feedforward control also is sometimes called preliminary control, precontrol,
preventive control, or steering control.

However, some authors use term "steering control" as separate types of control.
This types of controls are designed to detect deviation some standard or goal to
allow correction to be made before a particular sequence of actions is completed.

Concurrent Control
Concurrent control takes place while an activity is in progress. It involves the
regulation of ongoing activities that are part of transformation process to ensure
that they conform to organizational standards. Concurrent control is designed to
ensure that employee work activities produce the correct results.

Since concurrent control involves regulating ongoing tasks, it requires a thorough

understanding of the specific tasks involved and their relationship to the desired
and product.

Concurrent control sometimes is called screening or yes-no control, because it

often involves checkpoints at which determinations are made about whether to
continue progress, take corrective action, or stop work altogether on products or
services.

Feedback Control
This type of control focuses on the outputs of the organization after transformation
is complete. Sometimes called postaction or output control, fulfils a number of
important functions. For one thing, it often is used when feedforward and
concurrent controls are not feasible or are too costly.

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Sometimes, feedback is the only viable type of control available. Moreover,
feedback has two advantages over feedforward and concurrent control. First,
feedback provides managers with meaningful information on how effective its
planning effort was. If feedback indicates little variance between standard and
actual performance, this is evidence that planning was generally on target.

If the deviation is great, a manager can use this information when formulating new
plans to make them more effective. Second, feedback control can enhance
employees’ motivation.

The major drawback of this type of control is that, the time the manager has the
information and if there is significant problem the damage is already done. But for
many activities, feedback control fulfils a number of important functions.

Importance of Organizational Control

A control system contains the measures or yardsticks that allow managers to

assess how efficiently the organization is producing goods and services.

1. Without a control system in place, managers have no idea how their organization
is performing and how its performance can be improved.
2. Organizational control is important in determining the quality of goods and
services because it gives managers feedback on product quality.
3. Effective managers create a control system that consistently monitors the quality
of goods and services so that they can make continuous improvements to quality.
4. By developing a control system to evaluate how well customer-contact
employees are performing their jobs, managers can make their organizations more
responsive to customers.
5. Monitoring employee behavior can help managers find ways to increase
employees’ performance levels.
6. Controlling can raise the level of innovation in an organization by deciding on
the appropriate control systems to encourage risk taking.

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THE MANAGERIAL ROLE CONCEPT
Organisation

Organization-“social units (or human groupings) deliberately constructed and

reconstructed to seek specific goals”

Types of Organizations

Private for profit (market sector organizations)-includes business and corporation

organized with the primary goal of making an economic profit.
Governmental – includes local, state, national, and international government
organizations. (Examples are public health, education, and human service
organizations).
Private not for profit (non-governmental organizations) NGO’s/Voluntary or
service sector (Lions Club), provides civic and human services which are funded
by private citizens (donations) fundraising organizations (example is united way),
or privately funded foundations (example is Ford)

Forms of organisation

Formal Organisation is formed when two or more persons come together. They
have a common objective or goal. They are willing to work together to achieve this
similar objective.

Formal Organisation has its own rules and regulation. These rules must be
followed by the members (employees and managers). A formal organisation has a
system of co-ordination. It also has a system of authority. It has a clear superior-
subordinate relationship. In a formal organisation, the objectives are specific and
well-defined. All the members are given specific duties and responsibilities.
Examples of formal organisation are:- a company, a school, a college, a bank, etc.

Main features of formal organization

1. Delibrately planned and created
2. Concerned with the co-ordination of activities
3. Hierarchically structured with stated objectives.
4. Based on certain principles such as the specialization of task.
5.Organization structure is laid down by top management to achieve organizational
goals.

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Importance/Advantages

(1) Easy to Fix Accountability: Since the authority and responsibility of all the
employees have been already fixed, inefficient employees can easily be
apprehended and in this way their accountability can be fixed.

(2) No Overlapping of Work: Everything moves in an orderly manner. Therefore,

there is no possibility of any work being left out or unnecessarily duplicated.

(3) Unity of Command Possible: It is possible to observe the principle of unity of

command in view of the presence of scalar chain of authority.

(4) Easy to Get Goals: It is easy to achieve the goals of the organisation because
there is an optimum use of all the material and human resources.

(5) Stability in Organisation: All the people work by observing rules and remain
confined within the domain of their authority. This leads to the establishment of
good relationship which, in turn, leads to stability to the organisation.

6) Clarity in chain of command: In a formal organization the chain of command

is clearly drawn so that personnel in the organization can follow them as per and
ordered to do so. In a formal organization the chain of command is strictly
followed to achieve the company goal.

Disadvantages of Formal Organization

A formal organization has many advantages both for its internal and external
environment but it has some disadvantages too. The common disadvantages can be
listed as follows:

1. Limited Flexibility: As this type of organization is very specific in every

activates there is very little margin of flexibility and spontaneous decision
making in the company. Such practice in the company can be demotivating
to the employees.
2. Slowness of processing: In a formal organization for performing a task
needs many formal procedures to accompany. Such formalities often slow
down the implementations of decision making.
3. Communication Barrier: As in a formal organization a task needs the co-
ordination of different departments so communication needs to clear in this
process. Any kind of miscommunication may lead to ultimate inefficiency.

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 4. Quality of decision: Sometimes the quality of the decision made in the top
management may not be most compatible for the company but the chance of
correction is very scarce.
5. Slowness in Problem detection and processing: As every procedure goes
through lot of formalities any problem detected in the operation level can’t
be instantly corrected. The right process will take some time to detect the
problem and correction and its implementation. In such a process the
organization may suffer financial loss.

Informal Organisation exists within the formal organisation. An informal

organisation is a network of personal and social relationships. People working in a
formal organisation meet and interact regularly. They work, travel, and eat
together. Therefore, they become good friends and companions. There are many
groups of friends in a formal organisation. These groups are called informal
organisation.

An informal organisation does not have its own rules and regulation. It has no
system of co-ordination and authority. It does not have any superior-subordinate
relationship nor any specific and well-defined objectives. Here in informal
organisation, communication is done through the grapevine.

Features informal organization

1. Flexible and loosely structured

2. Relationship may be left undefined
3. Membership is spontaneous
4. Source of information may not be known as anybody can communicate.
5.The existence of informal structure depends on the formal organization structure.

Distinguish between formal and informal organization

1. Formed by Whom?

A formal organisation is formed by the top level management.

An informal organisation is formed by social forces within the formal organisation.

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2. Rules and Regulations

The members of a formal organisation have to follow certain rules and regulations.
These rules are available in writing (documented). They are made by a formal
authority (superiors). If the members follow these rules properly, then they will be
rewarded. However, if they do not follow these rules, they will be punished.

The members of an informal organisation do not have to follow any rules and
regulations.

3. Duties and Responsibilities

In a formal organisation, the duties, responsibilities, authority and accountability of

each member is well-defined.

In an informal organisation, there are no fixed duties, responsibilities, authority,

accountability, etc. for the members.

4. Objectives or Goals

In a formal organisation, the objectives or goals are specific and well-defined. The
main objectives of a formal organisation are productivity, growth, and expansion.

In an informal organisation, the objectives are not specific and well-defined. The
main objectives of an informal organisation are friendship, security, common
interest, individual and group satisfaction, etc.

5. Stability

A formal organisation is stable.

An informal organisation is not stable.

6. Channels of Communication

A formal organisation uses formal channels of communication.

An informal organisation uses informal channels of communication (i.e. grapevine)

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7. Organisation Chart

A formal organisation is shown on the organisation chart.

An informal organisation is not shown on the organisation chart.

8. Superior-Subordinate Relationship

In a formal organisation, there exist a superior-subordinate relationship.

In an informal organisation, there is no such superior-subordinate relationship.

9. Benefits for Members

The members of the formal organisation get financial benefits and perks like wages
or salaries, bonus, travelling allowances, health insurance, etc.

The members of informal organisation get social and personal benefits like friend
circle, community, groups, etc.

Distinguish between private sector and public sector organisation

Public sector refers to government-owned organizations and government-

provided services. Private sector refers to 1) organizations that are not
government owned, and 2) the goods and services provided by organizations
outside of the government. For example, companies owned by individuals are part
of the private sector.

THE CONCEPT OF STAKEHOLDERS

A person, group or organization that has interest or concern in an organization.

Stakeholders can affect or be affected by the organization's actions, objectives and

policies. Some examples of key stakeholders are creditors, directors, employees,
government (and its agencies), owners (shareholders), suppliers, unions, and the
community from which the business draws its resources.

Not all stakeholders are equal. A company's customers are entitled to fair trading
practices but they are not entitled to the same consideration as the company's
employees.

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An example of a negative impact on stakeholders is when a company needs to cut
costs and plans a round of layoffs. This negatively affects the community of
workers in the area and therefore the local economy. Someone owning shares in a
business such as Microsoft is positively affected, for example, when the company
releases a new device and sees their profit and therefore stock price rise.

Corporate social responsibility (CSR) promotes a vision of business accountability

to a wide range of stakeholders, besides shareholders and investors. Key areas of
concern are environmental protection and the wellbeing of employees, the
community and civil society in general, both now and in the future.

The concept of CSR is underpinned by the idea that corporations can no longer act
as isolated economic entities operating in detachment from broader society.
Traditional views about competitiveness, survival and profitability are being swept
away.

Some of the drivers pushing business towards CSR include:

1. The shrinking role of government

In the past, governments have relied on legislation and regulation to deliver social
and environmental objectives in the business sector. Shrinking government
resources, coupled with a distrust of regulations, has led to the exploration of
voluntary and non-regulatory initiatives instead.

2. Demands for greater disclosure

There is a growing demand for corporate disclosure from stakeholders, including

customers, suppliers, employees, communities, investors, and activist
organizations.

3. Increased customer interest

There is evidence that the ethical conduct of companies exerts a growing influence
on the purchasing decisions of customers. In a recent survey by Environics
International, more than one in five consumers reported having either rewarded or
punished companies based on their perceived social performance.

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4. Growing investor pressure

Investors are changing the way they assess companies' performance, and are
making decisions based on criteria that include ethical concerns. The Social
Investment Forum reports that in the US in 1999, there was more than $2 trillion
worth of assets invested in portfolios that used screens linked to the environment
and social responsibility. A separate survey by Environics International revealed
that more than a quarter of share-owning Americans took into account ethical
considerations when buying and selling stocks. (More on socially responsible
investment can be found in the 'Banking and investment' section of the site.)

5. Competitive labour markets

Employees are increasingly looking beyond paychecks and benefits, and seeking
out employers whose philosophies and operating practices match their own
principles. In order to hire and retain skilled employees, companies are being
forced to improve working conditions.

6. Supplier relations

As stakeholders are becoming increasingly interested in business affairs, many

companies are taking steps to ensure that their partners conduct themselves in a
socially responsible manner. Some are introducing codes of conduct for their
suppliers, to ensure that other companies' policies or practices do not tarnish their
reputation.

Some of the positive outcomes that can arise when businesses adopt a policy of
social responsibility include:

1. Company benefits:

 Improved financial performance;

 Lower operating costs;
 Enhanced brand image and reputation;
 Increased sales and customer loyalty;
 Greater productivity and quality;
 More ability to attract and retain employees;
 Reduced regulatory oversight;
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  Access to capital;
 Workforce diversity;
 Product safety and decreased liability.

2. Benefits to the community and the general public:

 Charitable contributions;
 Employee volunteer programmes;
 Corporate involvement in community education, employment and
homelessness programmes;
 Product safety and quality.

3. Environmental benefits:

 Greater material recyclability;

 Better product durability and functionality;
 Greater use of renewable resources;
 Integration of environmental management tools into business plans,
including life-cycle assessment and costing, environmental management
standards, and eco-labelling.

Nevertheless, many companies continue to overlook CSR in the supply chain - for
example by importing and retailing timber that has been illegally harvested. While
governments can impose embargos and penalties on offending companies, the
organizations themselves can make a commitment to sustainability by being more
discerning in their choice of suppliers.

The concept of corporate social responsibility is now firmly rooted on the global
business agenda. But in order to move from theory to concrete action, many
obstacles need to be overcome.

A key challenge facing business is the need for more reliable indicators of progress
in the field of CSR, along with the dissemination of CSR strategies. Transparency
and dialogue can help to make a business appear more trustworthy, and push up the
standards of other organizations at the same time.

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The Global Reporting Initiative is an international, multi-stakeholder effort to
create a common framework for voluntary reporting of the economic,
environmental, and social impact of organization-level activity. Its mission is to
improve the comparability and credibility of sustainability reporting worldwide.

There is increasing recognition of the importance of public-private partnerships in

CSR. Private enterprise is beginning to reach out to other members of civil society
such as non-governmental organizations, the United Nations, and national and
regional governments.

An example of such a partnership is the 'Global Compact'. Launched in 1999 by

the United Nations, the Global Compact is a coalition of large businesses, trade
unions and environmental and human rights groups, brought together to share a
dialogue on corporate social responsibility.

The 'Working with NGOs' section offers some insights into the way businesses and
lobby groups are working together to mutual benefit.

Management training plays an important role in implementation of CSR strategies,

and there is a growing number of conferences and courses available on the subject.
Organizations that provide such training include Global Responsibility, Business
for Social Responsibility and the Corporate Social Responsibility Forum.

ORGANISATIONAL STRUCTURE

An organisational structure is defined as the arrangement and the

interrelationships of the component parts and position of a company.

IMPORTANCE/ADVANTAGES OF ORGANISATIONAL STRUCTURE

1. Personal Identity: Every member of the organisation can see his/her

position and department as a whole.

2. Determination of Responsibility: The structure also determines the

responsibilities of the individual workers. This enables each worker to know
what is expected of him/her.

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3. Co-ordination: The structure is an effective means of harmonising
individual and group efforts towards the accomplishment of individual and
groups objectives.

4. Specialisation: The structure shows individual functions and allows the

use of specialisation of skills to be practised. This enables productivity to
increase.

5. Establishment of Authority: Organisational structure establishes authority

relationships in a company. It makes individuals to know their immediate
superiors. This helps to avoid conflicts as far as the unity of command
principle is concerned.

LIMITATIONS/DISADVANTAGES OF ORGANISATIONAL
STRUCTURE

1. Inflexibility: The structure may introduce inflexibility into a company’s

operations since employees come to know and accept their areas of
responsibilities, they might not want to do jobs in other departments.

2. Complex: Designing the structure is very complex and time consuming. It

may also need constant revision to mach changes needs of the organisation.

3. Misleading: The structure at a glance might indicate that all those on the
same management levels have the same authority and of equal status.
However, some are more superior to others.

4. Bureaucracy: It encourages bureaucracy and slows the decision making

process of the organisation.

TYPES OF ORGANISATIONAL STRUCTURES

A. LINE STRUCTURE: It is an organisation structure in which

authority and responsibility flow directly from top to bottom and
bottom to top respectively. This organisation makes it possible to the
owners at the apex of the structure. Each employee is responsible to
one superior person above him or her only. The pattern of line

86
 organisation can be illustrated in the vertical organisational chat
shown below.

LINE ORGANISATION STRUCTURE

CHIEF EXCUTIVE

CHIEF MARKETING PRODUCTION

ACCOUNTANT MANAGER MANAGER

FINANCIAL MANAGEM HOME OVERSEAS ADVERTI- PRODUCTION FACTORY

ENT SEMENT
ACCOUNT- SALES SUPERVI-SOR
ANT
ADVANTAGES OF LINE
ACCOUNT- SALES
ANT STRUCTURE PLANNING SUPERVISOR

SUPER- SUPERVISOR SUPERVISOR

1. It is simple and easily understood.
VISOR

2. Discipline is always easier to maintain in the organisation.

3. It is the best form of an organisational structure especially for small
enterprise.
4. Division of authority and responsibility are clearly shown and defined.
5. Duties of employees are clearly shown and defined.

DISADVANTAGES OF LINE STRUCTURE

1. The structure does not provide specialist staff assistance for the line
managers.
2. It is not flexible.
3. Duties of staff are so limited that they do not gain the broad experience
needed for assuming managerial position.
4. The system is not suitable for large organisations where duties of
managers are made more complex.
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B. FUNCTIONAL STRUCTURE: The functional manager has an
authority which enables him to control all those performing work relating to
his function irrespective of where they are working. The auditing manager
for instance has the responsibility to audit activities all over the place
irrespective of where it is performed and so is the maintenance manager.
Below is a Functional Organisation Structure.
FUNCTIONAL ORGANISATION STRUCTURE

ACCOUNTS PERSONNEL MARKETING PRODUCTION PURCHASING

DEPARTMENT DEPARTMENT DEPARTMENT DEPARTMENT DEPARTMENT

ADVANTAGES OF FUNCTIONAL STRUCTURE

1. It improves control since each activity is being controlled by its

specialist.
2. There is better co-ordination resulting from team work between line and
functional managers. ANAMmmGING
DIRECTOR
3. The system is flexible and less autocratic.
4. There is much specialisation in this type of organisation.
5. It is most useful for a large and expanding organisation.

DISADVANTAGES OF FUNCTIONAL STRUCTURE

1. There is overlapping of authority and lack of fix line responsibility.

2. There are delays in decision making.
3. Since instruction comes from functional specialists, supervisors may not
be able to use their initiative to take decisions.
4. The cost of maintaining such a system is very high since several
specialists must be paid.
5. Workers become confused when they have instruction from more than
one superior.

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 C. LINE AND STAFF STRUCTURE: As the company keeps expanding,
its operations and management becomes complex. There is thus the need to
employ specialist to assist the line managers.

The staff managers are thus specialists who are employed to advice the line
managers. The advice may be accepted, rejected or modified by the line
managers.

Below is a Line and staff Organisation structure.

LINE AND STAFF ORGANISATIONAL STRUCTURE

MANAGING DIRECTOR

PERSONNEL RESEARCH PRODUCTION MARKETING FINANCE

INDUSTRIAL RECRUIT- TRAIN-ING ADVERTI-SING SALES MARKETING

MENT
RELATIONS RESEARCH

ADVANTAGES OF LINE AND STAFF ORGANISATION

1. Introduction of specialist brings efficiency into the system.
2. Line managers are free from the performance of specialised duties.
3. There is better co-ordination.
4. There is the principle of specialisation. It enables an organisation to make
full use of the expertise of staff personnel.

DISADVANTAGES OF LINE AND STAFF STRUCTURE

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 1. There is the danger of line personnel managers undermining the staff
personnel by refusing to take the advice given to the staff personnel.
2. There can be risk of misunderstanding or misinterpretation when
instructions are given to workers by experts.
3. Duties might not be clearly defined and this can cause confusion among
junior staff.
4. Conflict between line managers and staff managers can prevent a
business from moving forward.

MATRIX ORGANIZATION.

Matrix management structures combine functional and product

departmentalization. They simultaneously organize part of a company along
product or project lines and part of it around functional lines to get the advantages
of both. For example, a diagram of a matrix model might show divisions, such as
different product groups as shown on the table. Along the left side of the same
table would be different functional departments, such as finance, marketing, and
production. Within the matrix, each of the product groups would intersect with
each of the functional groups, signifying a direct relationship between product
teams and administrative divisions. In other words, each team of people assigned
to manage a product group might have an individual(s) who also belonged to each
of the functional departments, and vice-versa.

Theoretically, managers of project groups and managers of functional groups have

roughly equal authority within the company. As indicated by the matrix, many
employees report to at least two managers. For instance, a member of the
accounting department might be assigned to work with the consumer products
division, and would report to managers of both departments. Generally, however,
managers of functional areas and divisions report to a single authority, such as a
president or vice president.

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Linear-functional structure-based project organization

 The project activities are carried out by the professionally competent

employees of the functional organizational units led by the function leaders
 The project leader does not have a formally assigned scope of authority over
the participants of the project
 The scope of authority formally ensured for the project leader is not in
balance with the responsibility pertaining to the implementation of the
project (exception: functional project – within a functional organization unit,
or if the project leader is also a senior manager)

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Factors affecting organisation structure

The "structure" of any organisation is the way in which the work required to
achieve the organisation's mission is divided into "jobs" that are then allocated to
individuals to fulfil.

There is no perfect solution to developing an organisation structure, and no perfect

way to divide the total work among the people of the organisation.

However there are factors that will likely influence the makeup of the
organisation's workforce. Among the more important factors are:

 The mission of the organisation

 The priorities of the organisation
 Goals and objectives to be achieved
 Capability of the organisation's human resource
 Financial resources available

92
These factors are :

93
 An organisation with a mission to provide service will be
structured differently to an organisation that exists
The mission of primarily to sell products.An organisation that is a non-
the organisation profit organisation will be structured differently to an
organisation that is a for-profit business.

Managing an organisation is about dealing with the

problem that there is always too much to do and too few
staff to carry out the work. Management must determine
The priorities of which tasks are most important and assign personnel to
the organisation them. Therefore the organisation structure will depend on
what decisions have been made by management with
respect to priorities.

Statements of "Goals" and "Objectives" represent what the

organisation wants to achieve. They change from time to
Goals and
time as a result of the changing environment in which the
objectives to be
organisation lives. As Goals and Objectives change so will
achieved
the organisation's structure.

Generally the human resources of any organisation is the

key factor determining success. With enough good people,
organisations can achieve all that is desired. However
Capability of finding good people is often very difficult, especially when
Human you need them as volunteers (unpaid) in non-profit
Resource organisations. It is often the case that priorities, goals and
objectives and funding are determined according to what
"good people" can be found,

Organisations cannot solve problems by simply employing

Financial
more people, if only this was the case! The number of paid
resources
people in an organisation is limited by the availability of
available
funding. Even when organisations rely on volunteers, the

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 need for money does not subside.

ORGANISATIONAL CHARTS

An organisational chart is a diagrammatic representation of the structure of a

business. It shows the functions, departments and positions of the
organisation’s members and how they are related.

An organisational chart is illustrated below;

TYPES OF ORGANISATION CHARTS

1. Vertical charts: These refer to charts that are drawn from top to bottom.
The top

executives are shown at the top of the chart and the lowest at the bottom .
VERTICAL CHART

BOARD OF DIRECTORS

MANAGING DIRECTOR

GENERAL MANAGER

PRODUCTION PERSONNEL FINANCE MARKETING PURCHASING

MANAGER MANAGER MANAGER MANAGER MANAGER

. Horizontal
2PRODUCTION charts: These refer to charts that ADVERTISING
FACTORY
are drawn from left
SALES
to right. The
top executives are shown on the extreme left, followed by successive managers and
PLANNING
OFFICER
OFFICER OFFICER OFFICER
the lowest subordinates at the extreme right. The diagram of horizontal chart is
drawn simply by rotating the vertical chart 90° anti-Clock wise (left).

95
 3. Circular charts: These refer to charts that are drawn in circular forms. The
highest position is indicated in the inner most circle and the lowest in the outer
most circle. The diagram below represents a circular chart.

CIRCULAR CHART

MD

4.17 4.27
677 677 3
4.37
677

2 1

KEY:

MD: Managing Director

1. – Production Department
2. - Finance Department
3. - Personnel Department
4. - Marketing Department
4.1 - Advertising
4.2 - Sales
4.3 - Market Research

USES/ADVANTAGES OF ORGANISATION CHARTS

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 1. It helps to show the channel of communication flow. The lines show the formal
communication flow in the company.
2. It also helps to show superior-subordinate relationship, that is who reports to
whom in the organisation.
3. The chart also indicates the management levels. All workers who report to the
same superior are on the same level of management regardless of where they may
appear on the chart.
4. The chart reveals the span of management control, that is, the number of
subordinates who report to a superior.
5. It enables management to pin point areas of organisational defects for corrective
action to be taken.
6. The chart enables employees and others to see at a glance how the organisation
is structured.

DISADVANTAGES OF ORGANISATION CHARTS

1. The chart does not show many or it obscures them. For instance, it does not
show who has the greater degree of authority and responsibility at each
management level.

2. It does not show organisation informal relationships which are powerful

groupings at any work situation.

3. People read into charts things the charts do not intend to show. For instance
employees may infer status and powers on the basis of distance from the managing
director’s box.

4. The chart may at times be misleading in many respects. For instance, the
secretary to the managing director has no formal relationships with the functional
heads yet (s)he may determine their futures with the company.

5. It is difficult to design an organisational chart.

PRINCIPLE OF ORGANISATION

1. Objectives: The objectives of the organisation should be clearly defined. Every

single individual in the organisation should understand these objectives. This will
enable them to work efficiently and help the organisation to achieve its objectives.

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2. Specialisation : Every single individual in the organisation should be asked to
perform only one type of function (work). This function should be related to his
educational background, training, work-experience, ability, etc., in other words,
there should be a division of work and specialization in the organisation. This will
increase the efficiency, productivity and profitability of the organisation.

3. Co-ordination

The efforts of all the individuals, departments, levels, etc. should be co-coordinated
towards the common objectives of the organisation. Therefore, managers must try
to achieve co-ordination.

4. Authority

Every individual should be given authority (power) to perform his responsibilities

(duties). This authority should be clearly defined. Authority should be maximum at
the top level and it should decrease as we come to the lower levels. There should
be a clear line of authority which joins all the members of the organisation from
top to bottom. This line of authority should not be broken. It should be short, i.e.
there should be few levels of management.

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5. Responsibility

The responsibility (duties) of every individual should be clearly defined. This

responsibility is absolute, i.e. it cannot be delegated. The responsibility given to an
individual should be equal to the authority given to him.

6. Span of Control

Span of control means the maximum number of subordinates which one superior
can manage effectively. The span of control should be as small as possible.
Generally, at the top level, the span of control should be 1:6, while at the lower
level, it should be 1:20. Span of control depends on many factors such as nature of
job, ability of superior, skill of subordinate, etc.

7. Balance

There should be a proper balance between the different levels, functions and
departments of the organisation. Similarly, there should be a proper balance
between centralisation and decentralisation, authority and responsibility, etc. If
there is no balance between these factors then the organisation will not function
smoothly.

8. Chain of Command

The chain of command should be very short. That is, there should be very few
levels of management. If not, there will be many communication problems and
delays in execution of workflow.

9. Delegation

Authority and responsibility should be delegated to the lowest levels of the

organisation. Therefore, the decisions can be made at the lowest competent level.
The authority delegated to an individual should be equal to his responsibility.

10. Continuity

The organisation structure should have continuity. That is, the enterprise should be
able to use the organisation structure for a long period of time. The organisation
structure should be able to achieve not only present objectives but also future
objectives of the enterprise.
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11. Remuneration

Employers must remunerate their employees in a satisfactory manner.

Remuneration is a reward in the form of money for work done.
AUTHORITY, RESPONSIBILITY, ACCOUNTABILITY,
DELEGATION AND POWER IN AN ORGANISATION

1. AUTHORITY: This may be defined as a legitimate power which

enables superiors to act in a prescribed way to get things done through
other people. It is the right to make certain decisions and to ensure that
they are implemented. It also involves giving orders and expecting them
to be obeyed. For instance, if a superior gives orders to subordinates to
perform certain assignments and the orders are not obeyed and the
superior is not able to employ any disciplinary action he is said to have
no authority.
2. RESPONSIBILITY: This refers to the obligation to do something for
and on behalf of an organisation. Unlike authority, responsibility can not
be delegated. Responsibility is the obligation associated with one’s
official duties. E.g. we often hear people say “He is a responsible
husband”. This means that the husband does what is expected of him as a
married man.
3. ACCOUNTABILITY: This is the act of being held answerable for one’s
conduct in respect of certain responsibilities or obligations either
successfully or unsuccessfully performed. To be held accountable for
certain duties is to be blamed when the duties are poorly done.
4. POWER: This is the ability to influence the behaviour or acts of
subordinates.

CENTRALISATION
This refers to the concentration of authority in a single unit so that major decisions
are made by that single unit. This means the control and detail instruction with
regards to what should be done, how it should be done etc. is done by the head
office. ling, typing, mailing, duplicating etc. can be centralised.

ADVANTAGES OF CENTRALISATION

1. There is effective control and supervision of personnel and their performances.

2. Machines and equipment can be used more economically.
3. The cost of establishing centralised service is relatively low.
4. The absenteeism of one or few staff will have less effect on the workload
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 5. There is uniformity in the procedure of doing things since instructions come
from one source.
6. Peak loads of work can be easily handle since there is proper planning of work
in centralised unit.
DISADVANTAGES OF CENTRALISATION

1. Too rigid or strict in the control of activities may cause frustration.

2. Centralised unit is unsuitable for work of confidential nature.
3. Much errors may be committed as centralised staff may have little or less
understanding in the document they handle.
4. The physical remoteness of some facilities may cause delay in work.
5. There may be conflicts of priorities as personnel may put in pressure for their
work to be done before others who may have presented their work first.
6. Bureaucracy may set in since paper work and records are likely to increase.

DECENTRALISATION

This refers to the process whereby authority to command and absolute

responsibility for results are delegated to individual units or departments. It could
also be referred to as the diffusion of authority to individual units or departments.
Decentralisation is also termed Depermentalisation.

ADVANTAGES OF DECENTRALISATION
1. Most services are carried out to meet the special needs of individual
departments.
2. Confidential work can be carried out without inconveniences.
3. There is reduction in errors since staffs in decentralised units are more
conversant with documents and operations they handle.
4. Pressure on office staff is reduced in terms of urgency.
5. It enhances innovations since initiative can be exercise in decentrlised units.

DISADVANTAGES OF DECENTRALISATION
1. The movement from unit to unit to perform control and supervisory jobs renders
these activities ineffective.
2. The cost of creating decentralised units is expensive than cetralised unit.
3. Uneconomical use of machines and equipment since each decentralised unit
must be provided with office equipment and machines which may not be fully
used.
4. There is no uniformity in work procedure since each department adopts its own
procedure in office services.
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5. Staff absence adversely affects work in the department since there may be no
one to take over the work.

Delegation

Delegation means assigning of certain responsibilities along with the necessary

authority by a superior to his subordinate managers. Delegation does not mean
surrender of authority by the higher level manager. It only means transfer of
certain responsibilities to subordinates and giving them the necessary authority,
which is necessary to discharge the responsibility properly. Delegation is quite
common in all aspects of life including business. Even in the college, the principal
delegates some of his authority to the vice-principal.

 According to F.C. Moore, "Delegation means assigning work to the others and
giving them authority to do so."
 According to O. S. Miner, "Delegation takes place when one person gives
another the right to perform work on his behalf and in his name and the second
person accepts a corresponding duty or obligation to do that is required of him."
 According to Louis Allen, "Delegation is the dynamics of management, it is the
process a manager follows in dividing the work assigned to him so that he
performs that part which only he, because of his unique organizational placement,
can perform effectively, and so that he can get others to help him with what remain

Delegation is not a process of abdication. The person who delegates does not
divorce himself from the responsibility and authority with which he is entrusted.
He remains accountable for the overall performance and also for the performance
of his subordinates. Delegation is needed when the volume of work to be done is in
excess of an individual's physical and mental capacity.

Delegation involves the following three basic elements:

a. Assignment of duties to subordinates,

b. Granting of authority to enable the subordinates to perform the duties
assigned, and
c. Creation of obligation on the part of subordinate to perform duties in an
orderly manner.

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(A) Obstacles / Barriers on the Part of Manager / Superior / Delegator
1. Unwillingness of the manager to delegate authority : Some
superiors/managers tend to think that they can do the job better when they
themselves handle the job. The attitude that 'I can do it better myself' on
the part of superior acts as an obstacle to delegation. Some managers
(superiors) who are autocratic and power worshippers feel that delegation
will lead to reduction of their influence in the Organisation. A manager may
feel that if he has a competent subordinate and if he delegates authority to
the subordinate, quite likely he will outshine him (manager) and may be
promoted.
2. Fear of competition : A manager may feel that if he has a competent
subordinate and if he delegates authority to the subordinate, quite likely he
will outshine him. Fear of subordinate's excellence may come in the way of
delegation.
3. Lack of confidence in subordinates : A manager may hesitate to delegate
authority, if he feels that his subordinate is not competent to deal with the
problem and take decisions. Even fear of losing control over the
subordinates acts as an obstacle to delegation. In addition, fear of being
exposed due to personal shortcomings may act as an obstacle in the process
of delegation.
4. Lack of ability to direct : Sometimes, a manager may experience difficulty in
directing the efforts of his subordinates because of his inability to identify
and communicate the essential features of his long-range plans and
programmes.
5. Absence of controls that warn of coming troubles : An Organisation might
not have developed the controlling techniques to know in advance the
serious problems lying ahead. It may happen due to concentration of power
in the hands of few people. As a result, manager may resist delegation.
6. Conservative and cautious temperament of the manager : If a manager has a
conservative and over-cautious approach, there will be psychological barrier
in the way of delegation. A manager avoids delegation as he feels that
something may go wrong even when the instructions given are clear and the
subordinates are reliable.
7. Desire to dominate subordinates : Managers (Superiors) normally, have a
desire to dominate the subordinates functioning under their control. They
feel that their domination will reduce if the powers are delegated to

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 subordinates. They also feel that due to delegation, the subordinates will
know their managerial deficiencies. In order to maintain their superior status
and in order to dominate the subordinates, they avoid delegation itself.

(B) Obstacles / Barriers on the Part of Subordinates (Why Subordinates

Resist Delegation? )
1. Too much dependence on the manager for decisions : Some subordinates
avoid responsibility even when the superior/manager is prepared to delegate
authority. They want the manager to tackle problems and take decisions. A
subordinate who is not confident about his performance/ability will certainly
try to shirk responsibility even though his superior is prepared to delegate
functions and authority.
2. Fear of criticism : Subordinates express unwillingness to accept delegated
authority because of the fear of criticism in the case of mistakes. They fear
that they may be criticized by others if they commit mistakes. Such
subordinates have the following feeling in their mind, "Why should I stick
my neck out for my boss?"
3. Lack of information : A subordinate may hesitate to accept a new
assignment, when he knows that necessary information to perform the job is
not likely to be made available to him. He is reluctant to accept delegated
functions and authority as he feels that he will not be able to perform well
due to inadequate information available.
4. Absence of positive incentives : Positive incentives like recognition of work
and rewards go a long way in building up the morale of subordinates. In the
absence of such incentives in the form of recognition, appreciation or
monetary benefit, a subordinate may not be prepared to accept delegation of
authority.
5. Absence of self-confidence : A subordinate may lack self-confidence about
his ability to take quick and correct decisions. He may not like to accept new
challenging functions as he lacks self-confidence. Thus, lack of self-
confidence on the part of subordinates is one obstacle which comes in the
way of delegation of authority.
6. Difficulty in decision-making : A subordinate may not have the skill and the
expertise to take quick and correct decisions. He prefers to go to his superior
(boss) and ask for his guidance or opinion. Such psychology acts as a cause
for non-acceptance of delegation. A subordinate avoids delegation due to
such mental tension or inferiority complex.

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 7. Poor superior-subordinate relations : Absence of cordial relations in between
the superior and the subordinates hampers the process of delegation of
authority. The attitude of the superior towards subordinate may not be
friendly but hostile. There may be undue interference in the work assigned to
the subordinate. Even the good work of subordinate may not be appreciated
by the superior. Such situation creates unfavorable attitude of subordinate
towards delegation. He avoids delegation as and when offered.
8. Undue interference by superior : A superior should not interfere in the duties
delegated to the subordinate. He may offer guidance as and when asked for.
Some superiors interfere in the work of his subordinate and try to control
him often and again. In the absence of legitimate freedom, the subordinate
becomes uneasy and prefers to remain away from the process of delegation.
9. Fear of being exposed : Some subordinates may have inferiority complex.
They feel that they have limited capacity to accept the challenges which are
bound to come out to delegation. They feel that their inability to deal with
new problems will be exposed due to delegation. This fear acts as an
obstacle to delegation.

Co-ordination

The synchronization and integration of activities, responsibilities, and command

and control structures to ensure that the resources of an organization are used most
efficiently in pursuit of the specified objectives. Along with organizing,
monitoring, and controlling, coordinating is one of the key functions of
management.

Co-ordination Techniques

Establishing Structure

Creating an effective workflow starts by establishing a clear chain of command.

Clearly defining job roles and associated responsibilities ensures that everyone
knows what to do. Establishing an organizational chart lets everyone know who to
contact when things go wrong. This can be distributed by email, newsletter or
company website. Each department should produce regular status reports and
communicate with other departments to ensure work flows from one part of the
organization to another. Process improvement initiatives examine workflow
processes to eliminate waste, reduce errors and improve customer satisfaction.

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Planning Tasks

Project coordinators usually develop comprehensive plans to describe the work

involved with producing a company’s products and services. They use the
techniques recommended by professional organizations, such as the Project
Management Institute. For example, these coordinators use standard templates to
complete a stakeholder analysis, develop a project charter, create a work
breakdown structure, assign resources and monitor task completion. According to
the Project Management Institute, during the planning process, the project manager
defines the objectives and gathers stakeholder needs to coordinate the team and
direct efforts. Team members can review the details associated with a project so
there is no confusion about what needs to be done and when it needs to occur.

Communicating Decisions

Good communication prevents disputes, conflicts and delays. Project coordinators

can foster effective communication by conducting regular team meetings,
distributing status reports and documenting decisions made. Effective leadership
often involves influencing and motivating team members to adhere to established
policies and procedures so operations run smoothly. Coordinating the efforts of
many different employees, particularly when they are not located in the same place
or time zone, typically requires arranging regular meetings to exchange
information and using written communication to document procedures.

Aligning Activities

Developing and marketing a new product takes time and planning. To achieve an
aggressive deadline, several teams may be working in parallel. Coordinating the
efforts requires an effective liaison, ensuring supplies are ordered and delivered in
time to use in production activities. Volunteers may contribute to completing
checklists or formal quality control processes can be implemented to coordinate
work flow effectively.

Importance of coordination

1. Unity of action: – an enterprise has diverse resources; technique, activities etc

and they all must be coordinates to bring unity through unity in action.

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2. Increase in efficiency and economy: – coordination brings efficiency because
it is an effort of all organizational members. It also helps to maintain good relation
among all levels of management.

3. Development of personnel: – coordination helps to obtain information about

job, qualities of a job holder which helps to analyze about the potentialities of the
job holder and improve coordination system

4. Differential perception: – different people have different perception. When all

people are coordinated effectively their effort and power are concentrated to
achieve organizational goals.

5. Survival of the organization: – coordination helps o harmonize the work

resources and physical facilities. When there activities are not harmonized the
organization can’t achieve the goal and it can’t survive in the society

6. Accomplishment of objectives: – when the employees , their task and available

resources are coordinated, their production will be increased and it helps to
accomplish the objectives of the organization

7. Basis of managerial function: – all managerial functions such as planning,

organizing, directing, controlling etc can’t be conducted effectively without
communication.

8. Specialization: – in the absence of coordination in the organization the activities

can’t be moved in specialized areas. Therefore, it helps in specialization

Organisational Culture

The values and behaviors that contribute to the unique social and psychological
environment of an organization.

Organizational culture includes an organization's expectations, experiences,

philosophy, and values that hold it together, and is expressed in its self-image,
inner workings, interactions with the outside world, and future expectations. It is
based on shared attitudes, beliefs, customs, and written and unwritten rules that
have been developed over time and are considered valid. Also called corporate
culture, it's shown in:

(1) the ways the organization conducts its business, treats its employees,
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customers, and the wider community,
(2) the extent to which freedom is allowed in decision making, developing new
ideas, and personal expression,
(3) how power and information flow through its hierarchy, and
(4) how committed employees are towards collective objectives.

It affects the organization's productivity and performance, and provides guidelines

on customer care and service, product quality and safety, attendance and
punctuality, and concern for the environment. It also extends to production-
methods, marketing and advertising practices, and to new product creation.
Organizational culture is unique for every organization and one of the hardest
things to change.

Types of Organizational Culture

Before we get into the specific details of the different types of cultures, there are
two overarching models that companies will fall into, strong culture and weak
culture. In a strong culture, employees have a sense of empowerment and
understanding of the company goals, regulations and philosophy. This kind of
culture allows employees to be driven and feel respected which benefits the overall
health of a company. In a weak organizational culture, employees are lost,
unmotivated and operate under a regime of fear. Fear may motivate individuals but
not for long and for all of the wrong reasons. Employees should never feel like
they will be wrongly reprimanded for making mistakes or needing a little extra
guidance.

 Academy Culture

The name says it all. Academy culture depends on employees who are highly
skilled, studious and welcome further training and advancement. This type of work
place environment thrives off of intense training for employees being brought on
board and ongoing training for the employees already there. Organizations that
choose to follow this culture are very particular about who they hire, their existing
skill sets and their willingness to learn and grow. This format of management
keeps turn-over rates low and the employees eager to do their job to the best of
their ability. Many hospitals, universities and other educational institutions rely on
academy culture to stay up to date on the newest information and technology.

 Normative Culture

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This is your everyday corporate workplace. Normative culture is very cut and dry,
following strict regulations and guidelines that uphold the policies of the
organization. Employees rarely deviate from their specific job role, break rules or
do anything other than what is asked of them. These type of organizations run a
tight ship and are not suited for every type of employee. Know anything about The
Carrot, The Whip or The Plant? These are object-oriented approaches to
motivating your employees. Learn more about these techniques and others in
Motivating Employees.

 Pragmatic Culture

You know that saying the customer is always right? Well, that is the first and only
rule of a pragmatic culture workplace. The customer or client comes before
anything or anyone else. Because every customer is different, these type of work
places are very opposite of the normative culture environment as employees don’t
adhere to strict rules. Whatever the customer wants, the customer gets (within
reason, of course).

 Club Culture

Nothing but the best. This type of culture requires employees to be very skilled and
competent in their niche of work. Educational qualifications, prior work experience
and even personal interests are taken into consideration before an employee is
hired. (Learn effective hiring methods if your organization follows club culture.)
Club culture can be seen in organizations like the FBI, commercial pilots and
specialty branches of the military. The hiring process can be pretty intense for
these work environments, requiring multiple interviews, a stellar resume (and
references to back it up), background checks and so on. The upside of being a part
of a club culture is your hard work will pay off. These types of employers often
reward hard work with promotions but with that are frequent appraisals of your
work and role within the company.

 Baseball Team Culture

This could be the best type of organizational culture from an employee’s stand
point. Remember how pragmatic culture focuses on the customers? Well, baseball
team environments say it’s all about the employees. As long as the workers are
happy, comfortable and feel respected, the work will get done and the employees
will want to stick with the company for the long haul. Google is a good example of
a baseball team culture, the employees get to pretty much do what they want, soup
up their offices with whatever makes them feel creative – and it’s on the company
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dime. Company outings are a regular thing, social events within the office and
incentives are a big component of this type of culture. Sounds good, right?

 Fortress Culture

Contrary to baseball culture, fortress culture could be the worst (or the best if
you’re really good at what you do) for employees. This type environment is all
about the numbers. If the organization is doing well as a result of the employee’s
productivity then the employees continue to have a job. If the organization begins
to see a downfall in success then the individuals that aren’t pulling their weight are
terminated. An example of a company that follows this structure is WorldStrides
and more specifically their sales department. Salespeople have a very important
job to do, they seek out business, secure business and retain business. If a
salesperson is not fulfilling their quota or cannot meet the demands of the
department then the company will replace them in hopes of a better outcome with
someone else. Another downside to this type of work culture is the time and money
invested in training these employees. With such a high termination rate these
companies will hire a new set of people and be forced to train them only to find out
they cannot stay up to speed. However, if you are good at what you do you will
often be praised and will not have to worry about job security.

 Tough Guy Culture

Tough guy culture is basically another way of saying micro-management.

Employees are monitored every step of the way and when something does not meet
the standards or expectations of the company the employee is given guidance and
monitored further. It can be a tough (hence the name) environment for some to
work in especially if you are independent and have a creative mind. An example of
this would be in a customer service role. Most companies have scripts that
customer service representatives must follow when answering calls in a call center.
If you stray from the script at all, even just a word, it can mean the difference
between being in good standing with management – or bad. Calls are often
recorded for quality assurance and the employees will be reviewed consistently to
ensure that they are following the protocol. Sometimes these cultures follow the
three-strikes-you’re-out practice in which you can be terminated if you do not act
on any corrections provided to you during your review. It’s hard to be watched all
the time but these type of companies just want to ensure consistency and
commitment to their customers and they need employees that can be shaped to do
just that. Performance reviews can be tricky, try not to intimidate your employees,

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instead find tactful ways to say what you need to say in Performance Evaluation
Comments.

 Process Culture

This type of office culture provides a set of regulations and procedures that the
employees follow. It’s different than the normative culture as the regulations are
not a bullet-pointed list of do’s and don’ts so much as it is an ideology that the
employees adhere to. Employees know what they are getting into when they sign-
up and are often self-starters. Unlike tough guy culture, these employees are not
micro-managed and they rarely are given performance reviews. If they are given
reviews it’s annually and it’s to assess their work on a large scale, their aspirations
within the company and potentially a discussion about salary. More often than not,
government agencies run operate under the process culture.

 Bet Your Company Culture

This culture is for the patient risk-takers. Organizations that follow this culture are
known to literally bet the success or failure of their company on single decisions of
which the outcome is completely unknown. It can be a wild ride working for this
type of company as you don’t know what each day is going to bring. The
consequences of the decisions made by the individuals working in the bet-your-
company culture can be so dire that the company goes under; contrarily, they can
be so excellent that the company thrives more than ever before.

Now you see that there are many different types of culture that develop within a
company. Some companies practice more than one of these and some are strictly
one of the above. Overall, rooting your employees on while ensuring the customers
are happy is the best balanced culture there is. Try talking to your employees about
what they like and dislike about the work place and you can begin understanding
what changes need to be made for the health of your organization.

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According to Robert E. Quinn and Kim S. Cameron at the University of Michigan
at Ann Arbor, there are four types of organizational culture: Clan, Adhocracy,
Market, and Hierarchy.

 Clan oriented cultures are family-like, with a focus on mentoring, nurturing,

and “doing things together.”
 Adhocracy oriented cultures are dynamic and entrepreneurial, with a focus
on risk-taking, innovation, and “doing things first.”
 Market oriented cultures are results oriented, with a focus on competition,
achievement, and “getting the job done.”

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  Hierarchy oriented cultures are structured and controlled, with a focus on
efficiency, stability and “doing things right.”

There’s no correct organizational culture for an arts organization. All cultures

promote some forms of behavior, and inhibit others. Some are well suited to rapid
and repeated change, others to slow incremental development of the institution.

For example, Quinn and Cameron associate the lower two cultures (Hierarchy and
Market) with a principal focus on stability and the upper two (Clan and
Adhocracy) with flexibility and adaptability. A Hierarchy culture based on control
will lead mainly to incremental change, while a focus on Adhocracy will more
typically lead to breakthrough change.

The right culture will be one that closely fits the direction and strategy of a
particular organization as it confronts its own issues and the challenges of a
particular time.

Importance of organizational culture

 The culture decides the way employees interact at their workplace. A

healthy culture encourages the employees to stay motivated and loyal
towards the management.
 The culture of the workplace also goes a long way in promoting healthy
competition at the workplace. Employees try their level best to perform
better than their fellow workers and earn recognition and appreciation of the
superiors. It is the culture of the workplace which actually motivates the
employees to perform.
 Every organization must have set guidelines for the employees to work
accordingly. The culture of an organization represents certain
predefined policies which guide the employees and give them a sense of
direction at the workplace. Every individual is clear about his roles and
responsibilities in the organization and know how to accomplish the tasks
ahead of the deadlines.
 No two organizations can have the same work culture. It is the culture of an
organization which makes it distinct from others. The work culture goes a
long way in creating the brand image of the organization. The work
culture gives an identity to the organization. In other words, an organization
is known by its culture.
 The organization culture brings all the employees on a common
platform. The employees must be treated equally and no one should feel

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 neglected or left out at the workplace. It is essential for the employees to
adjust well in the organization culture for them to deliver their level best.
 The work culture unites the employees who are otherwise from different
back grounds, families and have varied attitudes and mentalities. The
culture gives the employees a sense of unity at the workplace.

Certain organizations follow a culture where all the employees irrespective of their
designations have to step into the office on time. Such a culture encourages the
employees to be punctual which eventually benefits them in the long run. It is the
culture of the organization which makes the individuals a successful professional.

 Every employee is clear with his roles and responsibilities and strives hard
to accomplish the tasks within the desired time frame as per the set
guidelines. Implementation of policies is never a problem in organizations
where people follow a set culture. The new employees also try their level
best to understand the work culture and make the organization a better place
to work.
 The work culture promotes healthy relationship amongst the employees.
No one treats work as a burden and moulds himself according to the culture.
 It is the culture of the organization which extracts the best out of each
team member. In a culture where management is very particular about the
reporting system, the employees however busy they are would send their
reports by end of the day. No one has to force anyone to work. The culture
develops a habit in the individuals which makes them successful at the

Corporate social responsibility (CSR)

Corporate Social Responsibility is a management concept whereby companies

integrate social and environmental concerns in their business operations and
interactions with their stakeholders. CSR is generally understood as being the way
through which a company achieves a balance of economic, environmental and
social imperatives (“Triple-Bottom-Line- Approach”), while at the same time
addressing the expectations of shareholders and stakeholders. In this sense it is
important to draw a distinction between CSR, which can be a strategic business
management concept, and charity, sponsorships or philanthropy. Even though the
latter can also make a valuable contribution to poverty reduction, will directly
enhance the reputation of a company and strengthen its brand, the concept of CSR
clearly goes beyond that.

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Corporate social responsibility (CSR) is also known as corporate citizenship,
corporate philanthropy, corporate giving, corporate community involvement,
community relations, community affairs, community development, corporate
responsibility, global citizenship, and corporate social marketing.

Corporate social responsibility has stepped boldly and unabashedly into the
limelight in the 21st century, with many firms professing an undying love for CSR.
But has it always been so?

Scholars note that for many years, the concept of social responsibility has been the
object of intense ideologically influenced debates:

Antagonists have asserted that the business of business should remain business —
simply making profits; while protagonists have spoken of the firm’s responsibility
to maintain an equitable and working balance among the claims of the various
directly interested groups — stockholders, employees, customers and the public at
large.

It is now widely accepted that corporate governance and its CSR component has
moved from the profit-centred model to the socially responsible model, a concept
referring to the way in which companies exercise responsibility and accountability
for the economic, social and environmental impact of their business decisions and
behaviours.

Consequently, Henry Ford can boldly assert that a good company delivers
excellent products and services, but a great company does all that and also strives
to make the world a better place.

Major Perspective of CSR

Three (3) major perspective of CSR are

a) Invisible hand

b) The hand of government

c) Hand of Management

The Invisible Hand: The chief spokesperson for the invisible hand or classical
perspective of CSR is economist Milton Friedman, but its root can be traced back
to eighteen century Adams Smith. The invisible hand view holds that the entire

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social responsibility can be summed up as “make profit and obey the law”.
According to this view, each corporation should actively attempt to increase profit
through legal means. In this way corporate responsibility will be guided by the
invisible hand of free market forces which ultimately ensures that resources are
allocated efficiently for the betterment of society. Otherwise, business executives
will take on the right to allocate resources, thereby gaining excessive power while
having little accountability to society for their allocation decisions.

The Government Hand: The Government’s involvement in CSR seems to rest

mainly with the legal dimension – which enjoins businesses to obey the law.
However, there is no comprehensive CSR policy or law in Ghana.

The Management Hand: The hand of management perspective states that

corporations and their managers are expected to act in ways that protect and
improve the welfare of society as a whole as well as advance corporate economic
interests. Three major arguments are typically advanced in the favour of
organizational social responsibility. The ant freeloader argument holds that since
business benefits from a better society, they should bear part of the cost of
improving it by actively working to bring about solutions to social problems. The
capacity argument states that the private sector, because of its considerable
economic and human resources must up for recent government social programmes.
The enlighten self interest argument holds businesses exist at society’s pleasure
and that for their own legitimacy and survival, businesses should meet the
expectations of public regarding social responsibility. Otherwise, they are likely to
eventually suffer financially and go out of business

Theories of Social Responsibility

1. Stakeholder Theory: This theory simply state that, there are a lot of stakeholders
that an organization must be responsible to.
2. Social Contract Theory: This says that every organization has a contractual
obligation towards society. Otherwise the society would not allow the organization
to exist in the first place.
3. Legitimate theory: It says that the society allows or decides that a particular
organization is good and proper so it should continue to exist. That is to say the
society gives the organization the legitimate existence.

Why Business Undertake Social Responsibility

1. Long term profitability: It is argued that supporting social activities contribute to
long term profitability of the business organization.

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2. Survival motive: It is in the best interest of a business organization to promote
and improve the community where it does business. Social responsibility increases
the viability of the business. If a business fails to take initiative in helping society
solve their problems. Society will retaliate by organizing product boycotts and
protest. This can lead to the closure of the business.
3. Moral (Ethical) obligation: Since the activities of many businesses have adverse
effect on the society, many businesses see it as a moral obligation to be socially
responsible. Eg providing employment and infrastructure among others in the
society.
4. Legal requirement: Businesses behave responsibly to maintain an orderly legal
society in order to avoid government intervention.
5.Subsidies and tax incentives: Some businesses have enjoyed government
incentives in a form of either government subsidies or tax holidays or tax rebates
for been socially responsible.

Dimension of social responsibility

1. Economic dimension: It states that companies have responsibility to produce

goods and provide services at a profit.
2. Legal dimension: This states that companies have the duty to obey the law.
3. Ethical dimension: Businesses have to exhibit behavior and ethical norms
beyond which is required by law.
4. Discretionary dimension: Business has to exhibit voluntary law driven by
social norm.

The balancing of all the dimensions stated above will enhance enlighten self
interest for the organization.
Enlighten self interest states that it is in the best interest of an organization to act in
ways the community consider socially responsible.

Ethical Responsibility
Business ethics are rules of conduct accepted to those directly involved and the
community at large. These rules are based on values, rights, duties and moral
concepts which spell out what a business organization feels it is right to do when
conducting business activities.
Ethics are principles of conduct within an organization that guides decision
analysis and behaviours. Each organization must also be concern about business
conduct. Ethics are also important for business because it is a pre-requisite for a
good business. Code of business ethics provides the bases in which policies can be

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derived to guide daily behaviour and decision in the work place. Examples of
business ethics may include the following.
 Avoiding nepotism in matters concerning promotions and transfers etc.
 Avoiding scape goating when one knows that one has committed an
offence and not the other.
 Avoiding excessive secrecy when one knows that revelation of vital
information to a firm is vital for its success.
 Avoiding discrimination on irrelevant grounds.
 Avoiding decision taken without consultation.
 Avoiding falsification of records.

Ethical Tools
1. Values: Values are broad ideas regarding what is desirable, correct and good
that most members of society share. Values are so general and abstract that they do
not explicitly specify which behaviours are acceptable and which are not. Instead,
values provides us with criteria and conception by which we evaluate people,
objects and events as to their relative worth, merit, duty or morality (Zanden
1990:33)
2. Right: It refers to things or possessions or properties that cannot be taken away
from one because the moral and legal laws are backing the entitlement of such
things, possessions or properties.
3. Norms: They are defined as social rules that specify appropriate and
inappropriate behavior in a given situations. They tell us what we should not aught
not and must not do. Norms are both prescription, which are the definition of the
acceptable and proscription which are definition of act which are not acceptable.
4. Morals: They are simply doing the right things ie things that are naturally
acceptable by a given society.

Legal Requirement of Business

Law may be defined as a body of rules statutes, legal codes, and regulations that
are enforceable by court. Legal practices of a business are therefore those statutes,
rules, legal codes and regulations that business enterprises are expected to comply
within the conduct of their business. Examples of legal requirement of business
include the following:
 Law on minimum wage
 Workers’ compensation law
 Law on payment of tax
 Price control act
 Food and drug act.
Differences Between Business Ethics and Legal Requirement of Business
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  Business ethics are rules design by the business herself while legal
requirement of a business are designed by the state.
 Business ethics are observed by specific business entity whereas legal
requirement of a business are observed by all business.
 Business ethics are based on normal grounds but legal requirements of a
business are based on law.
 Legal requirement of business are enforced by public but non-complaints of
business ethics are not enforced by public authorities.

COMMUNICATION
Communication in business refers to the process by which information is
transmitted between individuals and organisations so that an understanding
response or feedback results. It may also be explained as the practice whereby
people in an organisation exchange information or give instructions concerning the
operation of business. This implies that the process of communication involves the
passing on of ideas from one person to another, the latter who is the receiver
accurately getting the same ideas as was passed on and the transmitter being
assured of the accurate reproduction of ideas so transmitted by a feedback from the
receiver. The ideas so transmitted may be done orally, written or by gesture. It is a
two-way process of reaching mutual understanding, in which participants not only
exchange (encode-decode) information, news, ideas and feelings but also create
and share meaning. In general, communication is a means of connecting people or
places. In business, it is a key function of management--an organization cannot
operate without communication between levels, departments and employees.

Communication is the exchange and flow of information and ideas from one
person to another; it involves a sender transmitting an idea, information, or feeling
to a receiver (U.S. Army, 1983).

Effective communication occurs only if the receiver understands the exact

information or idea that the sender intended to transmit. Many of the problems that
occur in an organization and in our society is due to lack of effective
communication.

During the transmitting of the message, two elements will be received: content and
context. Content is the actual words or symbols of the message that is known as
language — the spoken and written words combined into phrases that make
grammatical and semantic sense. We all use and interpret the meanings of words

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differently, so even simple messages can be misunderstood. And many words have
different meanings to confuse the issue even more.

Context is the way the message is delivered and is known as paralanguage — it is

the nonverbal elements in speech such as the tone of voice, the look in the sender's
eyes, body language, hand gestures, and state of emotions (anger, fear, uncertainty,
confidence, etc.) that can be detected. Although paralanguage or context often
cause messages to be misunderstood as we believe what we see more than what we
hear; they are powerful communicators that help us to understand each other.
Indeed, we often trust the accuracy of nonverbal behaviors more than verbal
behaviors.

Some leaders think they have communicated once they told someone to do
something, “I don't know why it did not get done. I told Jim to do it.” More than
likely, Jim misunderstood the message. A message has NOT been communicated
unless it is understood by the receiver (decoded). How do you know it has been
properly received? By two-way communication or feedback. This feedback tells
the sender that the receiver understood the message, its level of importance, and
what must be done with it. Communication is an exchange, not a give, as all parties
must participate to complete the information exchange.

DIRECTION OF COMMUNICATION
Vertical Communication
This is how information from superiors gets to subordinates and from subordinates
to superiors, that is to say downwards and upwards respectively. Vertical
communication occurs between hierarchically positioned persons and can involve
both downward and upward communication flows. Downward communication is
more prevalent than upward communication. Larkin and Larkin (1994) suggest that
downward communication is most effective if top managers communicate directly
with immediate supervisors and immediate supervisors communicate with their
staff. A wealth of evidence shows that increasing the power of immediate
supervisors increases both satisfaction and performance among employees. One
way to give supervisors power is to communicate directly with them and to have
them provide input to decisions. Ensuring that supervisors are informed about
organizational issues/changes before staff in general, and then allowing them to
communicate these issues/changes to their staff, helps reinforce their position of
power. When the supervisor is perceived as having power, employees have greater
trust in the supervisor, greater desire for communication with the supervisor, and
are more likely to believe that the information coming from the supervisor is
accurate (Roberts and O’Reilly 1974).
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Downward Communication is more than passing on information to subordinates. It
may involve effectively managing the tone of the message, as well as showing skill
in delegation to ensure the job is done effectively by the right person. Although the
content priorities of downward communication have not been definitively
demonstrated, there is some level of certainty with respect to the best approach to
downward communication.

 Top managers should communicate directly with immediate supervisors

 Immediate supervisors should communicate with their direct reports
 On issues of importance, top managers should then follow-up by
communicating with employees directly

Upward Communication is even less popular in the organisational settings. One

consistent finding is that employee satisfaction with upward communication tends
to be lower than their satisfaction with downward communication (Gibson 1985.
Larkin and Larkin (1994) found low levels of satisfaction with all the strategies
commonly used to enhance upward communication, including employee surveys,
suggestion programs, employee grievance programs, and employee participation
programs such as quality circles and team meetings. Gibson and Hodgetts (1991)
note several management-based reasons for this lack of satisfaction, particularly,
that these strategies often do not involve two-way communication, are not
packaged well, are poorly timed, and are apt to trigger defensiveness on the part of
managers. In addition, McCelland (1988) found a number of employee-based
reasons why upward communication tends to be poor, including:

 Fear of reprisal – people are afraid to speak their minds

 Filters – employees feel their ideas/concerns are modified as they get
transmitted upward
 Time – managers give the impression that they don’t have the time to listen
to employees

Horizontal or Lateral
This is how communication takes place between people of the same rank, in the
same section of a department or in different section of a department. Horizontal
communication involves communication among persons who do not stand in
hierarchical relation to one another. The horizontal type of communication can also
be called the lateral communication. It is a type of communication in which
workers or managers who have the same level of authority in an organization
communicate directly among themselves. For instance, a good example of a

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horizontal communication can be as follows: When a Human Resource manager
communicates directly to a Production Manager. These two are people at the same
level of authority within the organization or business. However, with the greater
importance of teams, more attention is now being directed at communication
between team members. Lateral communications between workers in different
functional areas is also becoming a bigger concern as greater attention is being
directed at increasing the speed of production through simultaneous, as opposed to
sequential, work processes. And there is greater emphasis on communication
across distributed workers and geographically separated work groups doing similar
kinds of work in an attempt to promote learning and the sharing of expertise, best
practices, and lessons learned.
Diagonal Communication

Diagonal communication refers to communication between managers and workers

located in different functional divisions (Wilson 1992). A diagonal communication
in an organization is the process whereby the flow of information is between
people who work in different departments and are at different levels of the
organization. A good example of a diagonal communication is – an instance where
a Human Resource Manager is sending out information to an accounts officer in
the Accounting Department. Some experts in this field also define Diagonal
communication as the process of sharing information between different structural
levels within an organization or establishment. Although both vertical and
horizontal communication continue to be important, these terms no longer
adequately capture communication needs and flows in most modern organizations.
The concept of diagonal communication was introduced to capture the new
communication challenges associated with new organizational forms, such as
matrix and project-based organizations.

Bypassing Communication
The bypassing channel of communication normally happens as a result of either
urgency or privacy of a particular piece of information being delivered. This type
of information as the name suggests, happens when lower employees bypass
middle managers and communicate directly with a higher level manager or vice
versa. Most of the times, the main reason this form of communication is used
within an organization is because an issue is so urgent that a shorter route is needed
to get the message to the final recipient.

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 Communication Tools
1. Voice 8. Audio tape-recorder
2. Video tape-recorder 9. Typewriter
3. Telephone 10. Intercom
4. Film 11. Public address system
5. Loud-speakers 12. Motorola
6. Computer 13. Overhead projector
7. Posters 14. Notice board

Types of Communication

Based on style and purpose, there are two main categories of communication and
they both bears their own characteristics. Communication types based on style and
purpose are:

1. Formal Communication
2. Informal Communication

Formal Communication

In formal communication, certain rules, conventions and principles are followed

while communicating message. Formal communication occurs in formal and
official style. Usually professional settings, corporate meetings, conferences
undergoes in formal pattern.

In formal communication, use of slang and foul language is avoided and

correct pronunciation is required. Authority lines are needed to be followed in
formal communication.

Informal communication

Informal Communication: informal communication is done using channels that are

in contrast with formal communication channels. It’s just a casual talk. It is
established for societal affiliations of members in an organization and face-to-face
discussions. It happens among friends and family. In informal communication
use of slang words, foul language is not restricted. Usually. Informal
communication is done orally and using gestures.

Informal communication, Unlike formal communication, informal

communication do not follow authority lines. In an organization, it helps in

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finding out staff grievances as people express more when talking informally.
Informal communication helps in building relationships.

Methods of Communication
People communicate with each other in a number of ways that depend upon the
message and its context in which it is being sent. Choice of communication
channel and your style of communicating also affects communication. So, there are
two methods of communication.
1. Verbal Communication
2. Nonverbal Communication

Verbal Communication:
Verbal communication refers to the form of communication in which message is
transmitted verbally; communication is done by word of mouth and a piece of
writing. Objective of every communication is to have people understand what we
are trying to convey. Verbal Communication is further divided into:
 Oral Communication and
 Written Communication

Oral Communication: In oral communication, Spoken words are used. It includes

face-to-face conversations, speech, telephonic conversation, video, radio,
television, voice over internet. In oral communication, communication is influence
by pitch, volume, speed and clarity of speaking.

Factors affecting oral communication

1. Courtesy: As an effective communicator, be patience courteous and avoid
contradicting and interrupting others because it will not augur well for effective
communication.
2. Listening: Attention must be given to what is being said and after critically
considering the implication, provide a feedback to the speaker.
3. Styling: The manner in which one speaks must be appropriate to the
circumstances. Words and expressions should be chosen bearing in mind the
background of audience.
4. Thinking: One must think before speaking because once a statement is made, it
may be difficult to retract such statement.
5. Timing: The right time to communicate to your audience is the time they are
ready to listen to you.
6. Structuring: One must present his/her points logically.
7. Appearance: It is necessary to check your appearance because it shows how we
wish to be accepted by audience.

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 Advantages
1) It produces an immediate impact on the recipient.
2) Misunderstanding can be corrected.
3) Feedback can be obtained immediately.
4) It shows facial and other non-verbal communication.

Disadvantages
1) It may leave no records for future references.
2) Argument can generate thus causing poor working relationship.
3) Poor listening skills by the recipient can distort the facts or meaning.
4) Oral communication cannot present illustrations and figures.
Written Communication: In written communication, written signs or symbols are
used to communicate. A written message may be printed or hand written. In
written communication message can be transmitted via email, letter, report, memo
etc. Message, in written communication, is influenced by the vocabulary &
grammar used, writing style, precision and clarity of the language used.

Advantages
1) The message can be accurately and precisely presented.
2) It provides records for future references.
3) The written message may be supplemented with illustration and figures.

Disadvantages
1) It does not produce an immediate impact on the recipient.
2) Misunderstanding may take much time to be corrected.
3) An immediate feedback cannot be obtained.
4) It does not show facial and other non-verbal communication.

Nonverbal Communication
Nonverbal communication is the sending or receiving of wordless messages. We
can say that communication other than oral and written, such as gesture, body
language, posture, tone of voice or facial expressions, is called nonverbal
communication. Nonverbal communication is all about the body language of
speaker.
Nonverbal communication helps receiver in interpreting the message received.
Often, nonverbal signals reflect the situation more accurately than verbal
messages. Sometimes nonverbal response contradicts verbal communication and
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hence affects the effectiveness of message. Nonverbal communication has the
following three elements:

Advantages
1) It is used to compliment the verbal and written communication.
2) It helps to carry messages faster.
3) It makes messages more understandable.

Disadvantages
1) Different meaning can be attached to a message due to varied
interpretations.
2) No records exist on it.

Grapevine communication

What is grapevine communication? By definition, grapevine is a form of informal

communication that is usually based on rumors. In an organization setting,
grapevine communication is prevalent at the lower levels of an establishment or
organization. Many have asked why such type of communication is called
grapevine.

The reason Grapevine communication is called ‘grapevine’ is because of its

similarity to a grape vine. If you know grape vines then you’d know one interesting
thing about them, which is the fact that it is extremely difficult to find its origin.
Same can be said about grapevine communication because it is all based on
rumors. The origin of the information might never be known.

A typical example of grapevine communication in an organization or establishment

is conversations that go on between co-workers during lunch breaks, on their way
home from work or even in company parking lots.

In this brief article on grapevine communication, we are going to take a look at

some of the advantages and disadvantages of grapevine communication.

Features/characteristics
1) Grapevine spreads fast.
2) It dose not have a source.

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 3) Grapevine is normally made in oral form.
4) It can sometimes turn to be untrue.
5) It is difficult to destroy its stronghold.

Advantages of grapevine communication

1. The first advantage of a grapevine communication is the fact that

information through this channel is extremely fast. Many have said of
grapevine communication to be one of the fastest forms of communication.
It spreads faster than wild fire.
2. Another advantage of grapevine communication is that it tends to bring a
sense of unity among employees of an organization when they meet to share
and discuss certain issues. Experts say that because of the nature of
grapevine communication, it enhances group cohesiveness in many
organizations all over the world.
3. Grapevine communication is an informal mode of communication but it
plays an instrumental role in aiding the formal methods of communication in
every organization.
4. In organizations or establishments where formal communications do not
function properly, grapevine communication comes to the rescue.
Information through grapevine ends up being the only way employees can
get any information about things going on around them.
5. It serves as a feedback to management.
6. Personnel use it to express their emotions.
7. Management can use it in place of the official channels.
8. Management use grapevine to know the reaction of workers about a
particular policy.

Disadvantages of Grapevine communication

1. Grapevine information since it is largely based on rumors tends to carry

along with it partial information which ends up not giving the real state of
affairs in an organization.
2. Information received through grapevine might not be true.
3. Another great disadvantage of grapevine communication is the fact that it
can damage an organization’s goodwill. For instance imagine a situation

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 where lower ranking employees of an organization begin peddling false
information about people at the top. This action can gradually destroy the
goodwill of the organization.
4. The fourth disadvantage with grapevine communication is one that is
common in many organizations all over the world. This is when employees
become unproductive. Grapevine communication can make organizations
lose a lot of money because employees spend work hours talking about the
latest rumor circulating around them. The organization pays dearly for this.
5. Grapevine communication cannot be relied on because it is not trustworthy.
If not managed properly, it can have serious implications.
6. There is no means of checking its validity because it has no source.
7. The fast nature of it makes it difficult to control.

Bypassing Communication
The bypassing channel of communication normally happens as a result of either
urgency or privacy of a particular piece of information being delivered. This type
of information as the name suggests, happens when lower employees bypass
middle managers and communicate directly with a higher level manager or vice
versa. Most of the times, the main reason this form of communication is used
within an organization is because an issue is so urgent that a shorter route is needed
to get the message to the final recipient.

FACTORS TO CONSIDER WHEN CHOOSING A MEANS OF

COMMUNICATION
1) Speed: The speed in which the information needs to be delivered must be bore
in mind before choosing a means of communication.
2) Distance: The distance involved is an important factor for determining a
means of
communication.
3) Cost: The cost involve in sending the message should not be beyond the budget
of the organization.
4) Accuracy: The means of communication chosen must provide accuracy i.e.
sending the message without mistakes.
5) Safety: The means of communication must provide safety to the message.

Importance of communication

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1) Life-Blood: Communication is often seen as the life-blood of an
organisation. As the continuous flow of blood keeps an individual
moving, so is the continuous flow of information necessary for the proper
functioning of an organisation.
2) Employee Trust: Clear, open communication can create a sense of
transparency in your organization, which builds trust between levels of
employees. Where keeping employees in the dark can result in
resentments, tension, and a feeling of low job security, strong
communication can help them feel valued and trusted. Open
communication can reduce feelings of uncertainty and cluelessness about
the state of the company, which makes for a more-positive work
environment and staff who feel secure and safe.
3) Relationships: Communication is essential to building relationships
between staff members and between levels of employees, both on a
professional and social level. An atmosphere of open communication
makes it safe for employees to express their ideas; as a result, you will
have the benefit of your staff's combined experience in coming up with
innovative solutions. Communication prevents employees from feeling
isolated, builds teamwork, and creates a more collegial atmosphere in the
office. When relationships are strong, employees are better able to trust
one another and work together more effectively.
4) Clarity: In an organization, confusion and ambiguity can create negative
feelings and a tense atmosphere. By making roles and responsibilities
clear to everyone on staff, you can give your employees the information
they need to get their jobs done; this is particularly important when your
employees are dispersed or come from different backgrounds.
Communication reduces misunderstandings and cuts the costs associated
with mistakes.
5) Collaboration: Communication can help your employees collaborate
effectively, which will make for a more-productive team overall. When
you have multiple departments who are working on different facets of the
same project, communication can streamline the process and improve the
end result. When your staff talks openly to each other, they can
communicate potential issues, requirements and feedback that can make
the result stronger. Communication can ensure that everyone is on the
same page and prevent problems down the road.
6) Policy Formulation: Policy is a statement of management intention and
guiding principles. They direct conduct and cause management to
behave in a certain way. The policy must therefore be communicated to
those with the responsibility of implementing them.
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 7) Participation / Feedback: Communication is used to get subordinates to
participate in company’s activities as well as obtain their reactions on
management activities among others.
8) Controlling: This is the process of monitoring activities to determine
whether individual units and the organisation itself are obtaining
objectives effectively and for this to be effectively done, there is the need
for communication
9) Discipline: This involves rules for ensuring adherence to a code of
conduct and effective discipline entails recognition of communication
Barriers to Effective Communication
Recognizing barriers to effective communication is a first step in improving
communication style. Do you recognize these barriers from your own personal and
professional experience?

Encoding Barriers:

The process of selecting and organizing symbols to represent a message requires

skill and knowledge. Obstacles listed below can interfere with an effective
message.

1. Lack of Sensitivity to Receiver. A breakdown in communication may result

when a message is not adapted to its receiver. Recognizing the receiver’s needs,
status, knowledge of the subject, and language skills assists the sender in preparing
a successful message. If a customer is angry, for example, an effective response
may be just to listen to the person vent for a while.

2. Lack of Basic Communication Skills. The receiver is less likely to understand

the message if the sender has trouble choosing the precise words needed and
arranging those words in a grammatically-correct sentence.

3. Insufficient Knowledge of the Subject. If the sender lacks specific information

about something, the receiver will likely receive an unclear or mixed message.
Have you shopped for an item such as a computer, and experienced how some
salespeople can explain complicated terms and ideas in a simple way? Others
cannot.

4. Information Overload. If you receive a message with too much information, you
may tend to put up a barrier because the amount of information is coming so fast

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that you may have difficulty comfortably interpreting that information. If you are
selling an item with twenty-five terrific features, pick two or three important
features to emphasize instead of overwhelming your receiver (ho-hum) with an
information avalanche.

5. Emotional Interference. An emotional individual may not be able to

communicate well. If someone is angry, hostile, resentful, joyful, or fearful, that
person may be too preoccupied with emotions to receive the intended message. If
you don’t like someone, for example, you may have trouble “hearing” them.

6. The use of strange words or jargons: Strange words or jargons may be

misinterpreted.

7. Source of the message: The source of the message could make workers take it
serious or reject it. For instance a message from the Managing Director would have
a high source of credibility than one from the Security man.

Transmitting Barriers:

Things that get in the way of message transmission are sometimes called “noise.”
Communication may be difficult because of noise and some of these problems:

1. Physical Distractions. A bad cellular phone line or a noisy restaurant can

destroy communication. If an E-mail message or letter is not formatted properly,
or if it contains grammatical and spelling errors, the receiver may not be able to
concentrate on the message because the physical appearance of the letter or E-mail
is sloppy and unprofessional.

2. Conflicting Messages. Messages that cause a conflict in perception for the

receiver may result in incomplete communication. For example, if a person
constantly uses jargon or slang to communicate with someone from another
country who has never heard such expressions, mixed messages are sure to result.
Another example of conflicting messages might be if a supervisor requests a report
immediately without giving the report writer enough time to gather the proper
information. Does the report writer emphasize speed in writing the report, or
accuracy in gathering the data?

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3. Channel Barriers. If the sender chooses an inappropriate channel of
communication, communication may cease. Detailed instructions presented over
the telephone, for example, may be frustrating for both communicators. If you are
on a computer technical support help line discussing a problem, it would be helpful
for you to be sitting in front of a computer, as opposed to taking notes from the
support staff and then returning to your computer station.

4. Long Communication Chain. The longer the communication chain, the greater
the chance for error. If a message is passed through too many receivers, the
message often becomes distorted. If a person starts a message at one end of a
communication chain of ten people, for example, the message that eventually
returns is usually liberally altered.

Decoding Barriers.

The communication cycle may break down at the receiving end for some of these
reasons:

1. Lack of Interest. If a message reaches a reader who is not interested in the

message, the reader may read the message hurriedly or listen to the message
carelessly. Miscommunication may result in both cases.

2. Lack of Knowledge. If a receiver is unable to understand a message filled with

technical information, communication will break down. Unless a computer user
knows something about the Windows environment, for example, the user may have
difficulty organizing files if given technical instructions.

3. Lack of Communication Skills. Those who have weak reading and listening
skills make ineffective receivers. On the other hand, those who have a good
professional vocabulary and who concentrate on listening, have less trouble
hearing and interpreting good communication. Many people tune out who is
talking and mentally rehearse what they are going to say in return. We’ll see some
techniques for improving listening skills in Chapter 2.

4. Emotional Distractions. If emotions interfere with the creation and transmission

of a message, they can also disrupt reception. If you receive a report from your
supervisor regarding proposed changes in work procedures and you do not
particularly like your supervisor, you may have trouble even reading the report

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objectively. You may read, not objectively, but to find fault. You may
misinterpret words and read negative impressions between the lines.
Consequently, you are likely to misunderstand part or all of the report.

5. Physical Distractions. If a receiver of a communication works in an area with

bright lights, glare on computer screens, loud noises, excessively hot or cold work
spaces, or physical ailments, that receiver will probably experience communication
breakdowns on a regular basis.

6. Time Element: For communication to be effective, the message should be given

at the right time. For instance a student who is hungry may not understand what is
being taught

Responding Barriers:

The communication cycle may be broken if feedback is unsuccessful.

1. No Provision for Feedback. Since communication is a two-way

process, the sender must search for a means of getting a response
from the receiver. If a team leader does not permit any interruptions
nor questions while discussing projects, he may find that team
members may not completely understand what they are to do. Face-
to-face oral communication is considered the best type of
communication since feedback can be both verbal and nonverbal.
When two communicators are separated, care must be taken to ask for
meaningful feedback.
2. Inadequate Feedback. Delayed or judgmental feedback can interfere
with good communication. If your supervisor gives you instructions
in long, compound-complex sentences without giving you a chance to
speak, you may pretend to understand the instructions just so you can
leave the stress of the conversation. Because you may have not fully
understood the intended instructions, your performance may suffer.

How to make communication effective

1) Timely: Communication must be given at the time it is needed if possible, that is
it must be given at the right time.
2) Minimise Jargons: The communicator should use simple expression so that the
receiver will understand the message well.
3) Target audience: The status and background of the target audience must be
seriously considered to make communication effective.
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4) Clear objective: The sender must have clear idea of what to say in mind as well
as the desire results to be achieved.
5) Noise: Noise should be reduced to the barest minimum in order not to create
distortion
BUSINESS CORRESPONDENCE
The principal means by which a firm establishes business relations with the outside
world, its customers and other interested people is the business letter. It is,
therefore, very important that letters sent out, must be attractively set, devoid of
grammatical errors, and with correct spellings and punctuations. For, customers
form their impression about the firm from the tone and quality of the letters they
receive from a firm. The message carried in a business letter is important, therefore
accurate and plain, straightforward language that is clear and can be readily
understood must be used.

A. LETTER OF ENQUIRY
Pattern and Outline
Like all other formal letters, a letter of enquiry must follow this pattern.

Sender’s Address Date

Reference (where necessary) Receiver’s Address
Salutation Subject Heading
Signature Complimentary Close
Writer’s Name

Institute of Accountancy Studies

Adenta, Accra
10th January, 2016.
The Sales Manager,
Kingdom Books and Equipment Ltd,
Accra.

Dear Sir,

LETTER OF ENQUIRY

We have opened a DPFA Department in the institute which will offer Business studies (Diploma
in Public Finance and Administration). We would therefore be glad if you could provide us
information with regards to books on the following subjects;
1. Management and Business Communication.
2. Business Law
3. Accounting
4. Economics

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 We wait patiently for a prompt reply.

Yours faithfully,
( A.. Alfa )
Purchasing Manager
B. QUOTATION;

Kingdom Books and Stationery Ltd

Box 123
Accra.
20th January, 2016.
The Purchasing Manager
Institute of Accountancy Studies
Adenta, Accra

Dear Sir,

QUOTATION

We thank you for your enquiry of January 10, 2006.

Our business deals in the following books on the subject areas you made mentioned of;
a) Principles of Management
b) Business Communication
c) Business Law
d) Element of Economics
e) Principles of Accounting
I enclose a price list for the above mentioned books. We can promise prompt delivery when
order is placed.
We hope you will be satisfied with our prices, and we are looking forward to receiving an order
from you.

Yours faithfully,
(J.K. Yaro )
Sales Manager

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 C. ORDER;

Institute of Accountancy Studies

Adenta, Accra
30th January, 2016.
The Sales Manager
Kingdom Books and Equipment Ltd
Box 123
Accra.

Dear Sir,

ORDER

We write to order for the following books.

Particulars of book No. of books

Principles of Management 250

Element of Economics 150
Business Law 250
Total 650

We wait for prompt delivery.

Yours Faithfully,
( A:A:Alfa)
Purchasing Manager.

D. MEMORANDUM
The memorandum is a written communication used within an establishment or
organisation. It could be formal or informal depending on the content and the way
it is prepared.

Purpose of memorandum
a) To make proposal for the future to enable personnel plan or get upon the flow of
business activities.
b) To convey information.
c) To convey instruction.

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 d) To draw attention to a situation.
e) To remind management about routines in the organization.

Features of memorandum
a) No salutation or complimentary close.
b) It is usually initialed but not signed.
c) A memo is not usually put in an envelop except it contains confidential
information.
d) Memo is mostly short and addresses only one subject.

MEMORANDUM

TO: All Sales Representatives

FROM: Sale manager

DATE: January 31, 2006

SUBJECT: ACHIEVEMENT OF SALES TARGETS: JANUARY, 2006.

I want to thank you all for the excellent sales performance you achieved in
surpassing the company’s national sales turnover target for January, 2006 by $
9000

Well done to you all.

A.A.A.

E. REPORT

A report refers to a document that provides an account of something witnessed or

examined, or of work carried out, or an investigation together with conclusions
arrived at as a result of the investigation.

Types of report
a) Oral reports: These are usually made at societies and communities
meetings.
b) Routine reports: These are reports on sales and production.

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c) Special repo rts: These reports are called for under special circumstances,
e.g. a committee report.
d) Occasional report: these reports are carried out when there is an
occurrence that needs to be investigated, like accident report.

Format and Outline of a report.

A report may have the following component
a) The Heading or Title Page: This is where the title or heading is written on.
b) Terms of Reference: This aspect states clearly the instruction or circumstances
that called for the report.
c) Procedure: This contains the means by which the information is obtained.
d) Finding: This aspect looks at how the information obtained is being
analysed and summarised based on the precise heading.
e) Conclusion: This contains a summary of the principal findings.
f) Suggestions: These are personal opinion given by the one preparing the
report.
g) Signature: Those who prepare the report must append their signatures in
it

PRESS RELEASE

Definition
Press release refers to written, audio taped, or video taped matter about a book,
event, person, or program, presented by its promoters or principals to the media for
editorial comment and free coverage. Also called media release or news release.

How to write an effective press release

Make sure your story is newsworthy

Before you even attempt to write a press release, think about the things you like to
read, watch and listen to in the media. Most of us are generally interested in things
we haven't heard before, find surprising or help solve our problems. So before
drafting your press release, it's worth asking yourself these questions:

1. Is there anything "new" in my story?

2. Is there anything unusual or unexpected about it?

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3. Would this be of interest to anyone outside my business?

4. Will anyone actually care?

The last one sounds harsh, but is probably the most important: you might be
excited about your new marketing director or the launch of your new product, but
will anyone else be interested? If the answer is "no", hold off on that press release
until you have got a better story.

If you are not sure whether your story is newsworthy, read, watch or listen to the
publications or programmes you would like coverage in to get a feel for the kind of
stories they typically cover.

Write killer headlines

Most journalists get hundreds of emails every day, so it is a good idea to label
emails containing press releases with the phrase "press release" or "story idea". A
great subject line is also a must.

But do not try to be clever: most journalists will spend just a few seconds deciding
whether something looks interesting. If they don not immediately understand what
your story is about, they will move on to the next thing in their inbox.

So if your story is about the launch of the first financial planning consultancy for
women, say exactly that. "Women cash in on financial planning" might sound like
a better headline, but may mean nothing to a busy journalist scanning their inbox.

Get your top line in the first line of your press release

Getting a journalist to open your email is important, but if your first sentence
doesn't grab them, they may not read any further – which is why you need to get
the "top line" (the most important bit) of your story right at the beginning of your
release. Your first line should be a summary of the story (in no more than around
15-20 words) and read like the opening of a news story.

Journalists are generally taught to get as many of the "five Ws" (who, what, where,
why and when) in the opening line of news stories, so if you want examples of
great first lines for press releases, look no further than your daily newspaper.

Another trick is to imagine your story is going to be covered on a TV or radio

programme. A presenter generally has around 5-6 seconds to introduce each item

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eg "And coming up next ... why a local cafe owner is giving a free coffee this
weekend to anyone born in July." If your story was going to be featured on the
radio today, how would the presenter introduce it? Asking yourself that question
should give you the top line of your story.

Be concise

The ideal length of a press release is about an A4 side or about 300 to 400 words
(the length of a short news item). That is just three or four short paragraphs and a
couple of quotes. If yours is longer than that, you have probably got unnecessary
waffle that does not add anything to your story.

Do not be tempted to include background information about your company in the

opening paragraph. This – along with any other additional information – can
always be included in a "notes to editors" section at the end (it is fine to run over to
a second page for this).

Sub-headings and bullet points can be useful to make information easy to digest,
particularly if you're including figures or statistics.

Use quotes to provide insight, not information

Including quotes from people in your company can be helpful for journalists (and
on regional or trade publications are often used, word for word). A common
beginner's mistake is to use quotes to provide information, for example, "last year,
we employed 100 staff in 12 different countries and turned over £5m."

Quotes should be used to provide insight and opinion and sound like a real person
said them. They definitely shouldn't be full of jargon or technical language

Sample Press Release for Fashion Show

FOR RELEASE June 28, 2013

Media Contact: Mike Smith, mike@email.com

We are pleased to announce that Fit Fashion Show is taking a giant leap forward
and moving our annual event to San Francisco's Pier 16 on September 2, 2013.

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After two fantastic seasons of unparalleled success at Pitchford University, we
have decided to take advantage of new opportunities. This year, you will still see
your favorite elements of Fit Fashion Show: a world class production, the hottest
up-and-coming designers, and an exclusive slice of the Bay’s fashionable elite. Our
mission of multicultural arts promotion, ethnic diversity, and positive image
remain strong, and we are proud to continue our popular high school internship
program.

With a new year and a new location, Fit Fashion Show will also be making some
changes. The production has been revamped to make every seat feel like a front
row seat. With the shift away from Pitchford, Fit Fashion Show is happy to open
modeling opportunities and volunteer positions to the entire Bay. The 2013
beneficiary will be announced in the coming weeks.

We look forward to continuing our great relationships with sponsors, designers,

press, and all of our fans—and with only 64 days until show time, our staff has
kicked into full gear. Directors Mike Smith, Cate Parker, Rahul Singh, and Tina
Campos, along with the staff of Fit Fashion Show, are committed to making this
year's production one that goes down in history.

Open casting calls will take place in early July for models. Anyone interested in
getting involved as a sponsor, designer, member of the press, or volunteer should
contact info@fitfashionshow.org

For more information, please visit www.fitfashionshow.org

We look forward to seeing you at Pier 16 in San Francisco on September 2nd!

ARTICLE FOR PUBLICTION IN THE NEWS PAPER

A news article discusses current or recent news of either general interest (i.e. daily
newspapers) or of a specific topic (i.e. political or trade news magazines, club
newsletters, or technology news websites).A news article can include accounts of
eyewitnesses to the happening event. It can contain photographs, accounts,
statistics, graphs, recollections, interviews, polls, debates on the topic, etc.
Headlines can be used to focus the reader’s attention on a particular (or main) part
of the article. The writer can also give facts and detailed information following
answers to general questions like who, what, when, where, why and how.

An article.

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• is a piece of writing usually intended for publication in a newspaper, magazine or
journal
• is written for a wide audience, so it is essential to attract and retain the readers’
attention
• may include amusing stories, reported speech and descriptions
• can be formal or informal, depending on the target audience
• should be written in an interesting or entertaining manner
• should give opinions and thoughts, as well as facts
• is in a less formal style than a report

Other types of articles

 Academic paper – an article published in an academic journal. The status of

academics is often dependent both on how many articles they have had
published and on the number of times that their articles are cited by authors
of other articles.
 Scientific paper – an article published in a scientific journal.
 Blog – some blog articles are like magazine or newspaper articles; others are
written more like entries in a personal journal.
 Encyclopedia article – in an encyclopedia or other reference work, an
article is a primary division of content.
 Marketing article – an often thin piece of content which is designed to
draw the reader to a commercial website or product.
 Usenet article – a message written in the style of e-mail and posted to an
open moderated or unmoderated Usenet newsgroup.
 Spoken article – an article produced in the form of an audio recording, also
referred to as a podcast.
 Listicle – an article whose primary content is a list.
 Portrait – a portrait of a person (article).

Elements of an article

Headline

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A headline is text that is at the top of a newspaper article, indicating the nature of
the article. The headline catches the attention of the reader and relates well to the
topic. Modern headlines are typically written in an abbreviated style omitting many
elements of a complete sentence and almost always including a non-copula verb.

Byline
A byline gives the name and often the position of the writer, along with the date.

Lead

The lead (sometimes spelled lede) sentence captures the attention of the reader and
sums up the focus of the story. The lead also establishes the subject, sets the tone
and guides reader into the article.[1]

In a news story, the introductory paragraph tells the most important facts and
answers the questions: who, what, where, when, why and how. In a featured story,
the author may choose to open in any number of ways, including the following:
See also: Narrative hook

 an anecdote
 a shocking or startling statement
 a generalization
 pure information
 a description
 a quote
 a question
 a comparison

Body

 For the news story, details and elaboration are evident in the body of the
news story and flow smoothly from the lead.
 Quotes are used to add interest and support to the story.
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  The inverted pyramid is used with most news stories.

A featured article will follow a format appropriate for its type. Structures for
featured articles may include, but are not limited to

 chronological — the article may be a narrative of some sort.

 cause and effect — the reasons and results of an event or process are
examined.
 classification — items in an article are grouped to help aid understanding
 compare and contrast — two or more items are examined side-by-side to see
their similarities and differences
 list — A simple item-by-item run-down of pieces of information.
 question and answer — such as an interview with a celebrity or expert.

Conclusion

 a final quote
 a descriptive scene
 a play on the title or lead
 a summary statement
 the writer's opinion

Characteristics of well-written articles

 Article is usually on a well-defined topic or topics that are related in some

way, such as a factual account of a newsworthy event.
 The writer is objective and shows all sides to an issue.
 The sources for this news story are identified and are reliable.
 Show, don't tell.

Authorship

Publications obtain articles in a few different ways:

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  staff written — an article may be written by a person on the staff of the
publication.
 assigned — a freelance writer may be asked to write an article on a specific
topic.
 unsolicited — a publication may be open to receiving article manuscripts
from freelance writers.

Write your article. (250 words) First think about:

• Where is the article going to appear? (In a magazine.)
• Who are the intended readers? (Probably a fairly wide age group.)
• What is the aim of the article? (To talkabout your experiences, good and bad,
while studying abroad.) Then you need to decide:
• Which country have you studied in?
• Howlong were you there for?
• What did you study?
• What problems did you have while you were there?
• Howhave you changed?

SAMPLE OF ARTICLE - LEARNING ABOUT LIFE

Studying abroad is an exciting experience, giving you the opportunity to learn

more about the traditions and culture of the host country and its people. Apart from
the excellent education I received during three years in England, I also made a
wide circle of friends and improved my language skills. I learned how to face and
deal with various problems, and as a result, have become more independent and
self-confident.
I studied English Literature and this, along with making many friends both at
university and through the part-time job I had, helped improve my English.
Although I already spoke the language quite well, when I first arrived I had trouble
understanding some accents and the slang or colloquialisms that are in everyday
use. Now I am a much more fluent and natural speaker, and my writing has
improved, too.
The biggest problems I faced were finding somewhere to live when I did not know
the area well, getting the electricity and phone connected and generally learning to
look after myself. I had to get used to shopping, cooking and doing the housework,
as well as studying and working, so I quickly mastered the art of planning my time

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sensibly. Although adapting to living in a new country is not easy, once the initial
homesickness and missing the family has been overcome, learning to fend for
yourself certainly makes you a more independent person, and definitely more self-
confident. My time abroad helped me grow as a person and I feel I could tackle
any problem now in a calm and confident manner, without having to immediately
ask someone for their help.

MEETINGS

A meeting is the coming together of at least two people for the discussing of their
common interest.

Purposes of meetings
1. to give information
2. to obtain information
3. to bring together knowledge and experiences to solve a problem
4. presenting a proposal for discussion and usually for ultimate resolution
5. to air grievance
6. to take decisions within the area of authority

Advantages of meetings
1. Time is devoted to affairs in which members show interest.
2. It enhances the flow of communication downward and upward.
3. Discussion is always profitable as ideas are developed or new solutions
proposed through the medium of the meeting itself.
4. More experience and knowledge could be brought together.
5. Management gets to know better the feelings and reactions of employee.

Disadvantages of meetings
1. There is always a delay in convening a meeting and this may cause
inconvenience when management needs an instant decision.
2. It is sometimes frustrating and annoying when irrelevant discussions are
made.
3. It is usually difficult to arrange a convenient date and time for all
representatives.

Types of meetings

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 1. Formal meetings: This type of meeting follows a well recognized and
conventional procedure with a chairman and a set of rules. Examples of
such meetings include meetings of parliament, annual general meetings,
board meetings, executive meetings, etc.
2. Informal meetings: These meetings may have procedures but will
normally be more like discussion groups, very often acting in an advisory
capacity or political meetings like rallies where members of the public
are invited. On some occasions they may have no chairman. They include
departmental meetings, briefing meetings, working parties, etc.

Types of formal meeting

1. Annual General Meeting: This meeting is usually called by shareholders of
public company every year. During the meeting, the shareholders
assess the performance of their company whether it is progressing or retrogressing
and to know what dividend to declare. A minimum of 14 days’ notice in writing
must be given for an A.G.M. However, if a special resolution is to be passed, 21
days’ notice must be given. For unlimited companies, only 7 days’ notice is
necessary but 21 days’ notice must be given if a special resolution is to be passed.

2. Extra-Ordinary Meeting: This is a meeting which becomes necessary after an

Annual General Meeting had already taken place. An E.O.M. may be called when
it
becomes necessary to call shareholders again within the year to deliberate on
issues of importance. Adequate notice is required for an Extra-Ordinary Meeting.
3. Statutory Meeting: All companies limited by shares and those limited by
guarantee and having share capital are required to hold at least one Statutory
Meeting during their existence. This Statutory Meeting must be held not less than
one month and not more than three months after the company has been issued
certificate of commencement. At least 14 days’ notice in writing is required, but if
a special resolution is to be passed, 21 days’ notice is required. Private companies
are excluded.
4. Board Meeting: Directors of an incorporated body are by law required to hold
their first meeting as soon as possible after their appointment has been made and
the company has already been issued a certificate of incorporation.
5. Committee Meeting: This meeting is usually convened by members of a
particular committee.

Requirements of a valid meeting

1. There must be a chairman to steer the affairs of the meeting.

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2. There must be a quorum.
3. Adequate notice must be provided to every member expected to attend
the meeting.
4. There should be a secretary to write down the minutes of the meeting.
5. There must be rules governing the actions of the meeting.

Some terms used at meetings

1. EX-OFFICIO: A member appointed to a committee by reason of the

office he already holds.
2. CO-OPTED: A person brought into a committee by the members where
it is desirable because of his specialized knowledge in a special field.
3. STANDING ORDERS: These are special rules formed for the control of
regular important meeting e.g. quorum.
4. QUORUM: This specifies the minimum number of members that must
be present before a meeting can be held.
5. POINT OF ORDER: This is a question regarding the procedure at a
meeting or query relating to the standing orders or constitution raised by
members during the course of a meeting.
6. STANDING COMMITTEE: A committee elected to carry out a
particular but permanent work.
7. AD HOC COMMITTEE: A committee formed for one special purpose
and when this has been accomplished it is dissolved.
8. CASTING VOTE: A second vote usually allowed to the chairman if
there is equal number of votes for and against a motion.
9. ADJOURNMENT: This is the discontinuing of a meeting so that it may
be resumed at another day. When a meeting is adjourned ‘sine die’ it
means indefinite adjournment and that a new date will have to be decided
upon.
10.POSTPONEMENT: This is a situation where the date of a meeting is
re-scheduled.
11.QUESTION: When a motion is put before the meeting it becomes a
‘question’.
12.ORIGINAL MOTION: The proposal as first presented to the meeting.
13.MOTION: A formal proposal put forward by a member at a meeting. It
may be put forward in writing to the chairman or the secretary before the
meeting or may be proposed during the discussion of the items of
business. Motion may be discussed, amended and voted upon.
14.AMENDMENTS: A proposal to alter a motion either by adding or
deleting words.
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15.SUBSTANTIVE MOTION: It is an approved amendment embodied in
the original motion.
16.RESOLUTION: When a motion have been passed / carried by the
meeting.
17.LIE ON THE TABLE: This is where a meeting takes note of a matter
but does not discuss it yet.
18.NEM COM (NEMINE CONTRADICONTE): No one contradicts it
i.e. no vote against the motion. But some members may have not voted at
all.
19.PROXY: Voting by post or by appointing another person to vote on
one’s behalf.
20.UNANIMOUS VOTE: This occurs when all members of a meeting have
voted in favour of a resolution.
21.VOTE OF NO CONFIDENCE: This occurs when members are
aggrieved or are at variant with the chairman and they want him to vacate
the post of chairperson. In short, members have lost confidence in the
chairperson.
22.ANY OTHER BUSINESS: These are certain urgent / important issues
that arise in a meeting. These issues are treated separately after the
general business of the day has been transacted.
23.ADDENDUM: This is an amendment which adds words to a motion.
24.CLOSURE: This is a motion submitted with the object of ending the
discussion on a matter before the meeting.
25.RIDER: This is an additional clause or sentence added to the resolution
after it has been passed.
26.TELLER: A person appointed at a meeting to count votes.
27.STATUS QUO: This refers to a meeting about which there should not be
any change.
28.ENBLOC: This is a voting procedure where all members of a committee
are re-elected by the passing of one resolution.
29.IN CAMERA: This is a situation whereby a meeting is held behind
closed doors. In camera simply means “a meeting held not in opening to
the public”.
30.VOTING: This is the right of every member at a meeting to give an
expression of opinion about a matter under discussion.
31.INTRA VIRES: It means within the powers of the person or body
concerned.
32.ULTRA VIRES: It means beyond the powers or authority of the person
or body concerned.

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 33.SCRUTINER: Some one who counts and closely examines votes at
meetings.
34.PROPOSER: Some one who tables a motion at a meeting.

NOTICE OF MEETING

A meeting is convened by sending out notice of meeting and the agenda to each
person entitled to attend the meeting. This notification should show the venue, date
and time of meeting, type of meeting, business to be transacted, details of any other
business, date of notice and signature of the person convening the meeting.

Example of a Notice:

IAT, DPFA STUDENTS ASSOCIATION

NOTICE OF ANNUAL GENERAL MEETING

Notice is hereby given that the 6th Annual General Meeting of the IAT, DPFA Students
Association will be held in The Conference Room on Tuesday, 4th April, 2016 at 9.00am.

AGENDA
The agenda is the list of programmes of the items of business to be discussed at a meeting in the
order in which they are to be taken. The agenda must have a heading to indicate the kind of
meeting, where and when it is to be held.

FORMS OF AGENDA
A. ‘Skeleton’ Agenda: This contains only a summary of issues to be discussed at the meeting. In
this, it is only headings of the item to be discussed are written. This form of agenda is usually
combined with notice of meeting.

Example of ‘Skeleton’ Agenda:

AGENDA
1. Apologies
2. Reading of previous minutes.
3. Matters arising from previous minutes.
4. Annual Dinner/Dance.
5. Election of Executives.
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 7. Any Other Business (A.O. B.) or Other Matters.
8. Date of next meeting.

B. The Detailed Agenda: This contains details of headings to be discussed and sets out in a draft
form the resolution to be submitted at the meeting.

Example of Detailed Agenda:

AGENDA
Item No. Agenda Notes:
1. Reading of apology by Secretary own notes
2. Reading of minutes by Secretary
3. Discussing of matters by Members, etc.

C. Chairman’s Agenda: This Agenda contains additional information to assist the

chairman in his/her conduct of the meeting.

Example of Chairman’s Agenda:

AGENDA NOTES
1. Apologies Received from Mr. Ali; he is sick.
2. Minutes Copies sent to all members.
3. Matters Arising
a. Printing of T-shirts Miss Forsia to report.
b. Annual Dinner Miss Akos to report.

THE MINUTES: Minutes are records of proceedings of a meeting and are taken by the
secretary when a meeting is in process. In short, minutes are summaries of the
important matters discussed and decision reached for future reference.

THE PROCEDURES OF MINUTES

1. The description of the meeting.

2. Name of members present with the Chairman’s name being the first on the list.
3. Apologies for absence.
4. The minutes of previous meeting (either taken as read, if previously circulated to
members or read aloud and signed by the chairman if the meeting approves them as
correct.
5. Matters arising out of the minutes.

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 6. Correspondence.
7. Business for the day.
8. Any other business.
9. Date of next meeting.
10. The signature block for the chairman.

MINUTES WRITING

Types of Minutes
1. Resolution Minutes: In writing this minute, it is only decisions reached at that are
recorded. This occurs where members or participants accepts collective responsibility
for any decision arrived at. Resolution minute conceals debates, strong disagreement
and conflicts during the meeting. It is usually prepared at Board of Directors meetings.
2. Narrative Minutes: These minutes record the summary of the main points of a
discussion which proceeds the reaching of a decision.
3. Action Minutes: The secretary records the proceedings briefly; recording the name
of the person delegated to act upon a particular item and entered in a column usually
on the right hand side of the minutes page opposite to the item.

Example of Action minutes

MINUTES ACTION BY
Visit to Khakum National Park:
Member decided that this year’s visit should be made
before examination starts and air condition cars should Miss Salla Kojo
be used this time. Miss. Salla Kojo, Miss. Akosua John Miss Akosua John
and Mr. Ali Afrifa were chosen to plan the visit and Mr. Ali Afrifa
report to members at the next meeting.

SAMPLE MINUTES IN A RESOLUTION MINUTES FORM

IAT, DPFA STUDENTS ASSOCIATION
MINUTES OF THE IPS, DBS MEETING HELD AT
THE GREAT HALL ON MONDAY,
3RD APRIL, 2016.

1. Present:
Mr. A. A. Jack (Chairman)
Mr. R. A. Amponsa
Miss Y. A. Forsia
Mr. M. C. Ayine
Miss N. Clara (Secretary)

2. Apologies: Apologies were received from Mr. A. F. Ayoure.

3. Opening: The meeting started at 9.00am with a prayer by Mr. M.C. Ayine.

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 4. Minutes: The Minutes was read and accepted by the house as a true copy of
the proceedings of the previous meeting.

5. Matters Arising: It was reported that most of the furniture and fittings of the DBS
lecture rooms leave much to be desired.

6. Annual General: It was resolved that this year’s Annual General Meeting for all
Meeting: DBS students will be held on the 10th November, 2006.

7. Any Other Matter: Miss N. Clara suggested that the next get- together should be
made earlier so that those who want to travel could have
sufficient time to prepare.

8. Next Meeting: It was decided that the date of the next meeting will be
communicated to members later.

9. Closing: The meeting ended at 2.00pm with a prayer by Miss N. Clara.

Signed:

Date:
The powers of the chairman at meetings

1. The Chairman has the power to maintain order at meetings.

2. To decide on ‘point of order’ at meetings.
3. To call for the adjournment of a meeting.
3. To order that someone be sent out of the meeting premises if such a person is
causing disorder.

Duties of a chairman at meetings

1. To make sure that the meeting is properly convened or organised.
2. To ensure that the quorum is present.
3. To maintain order at meetings.
4. To give adequate opportunity to those who wish to speak.
5. To ensure that standing orders are observed.
6. To ensure that relevant discussions are made.

Duties of the secretary before meeting

1. Issues out notices to members.
2. Prepares agenda after consulting the Chairman and the agenda should be sent to those
who are called to the meeting.
3. To make sure that the venue for the meeting is ready or is in order.
4. Gets all the necessary items needed at the meeting.
5. The secretary prepares the Chairman’s agenda.
6. Recording of minutes or meeting procedures.

Duties of the secretary on the day of the meeting

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1. Must be at the venue early with all the necessary items for the meeting.
2. Provide writing materials for members who may not come with writing material.
3. Must ensure that those present sign the attendance register.
4. Reading of the previous minutes, any apology letters and any other correspondence.
5. Taking down the records of proceedings.
6. Assisting chairman in supplying information from relevant files when the need arises.

Duties of the secretary after the meeting

1. To ensure that all items and documents sent to the meeting are returned to their
appropriate places.
2. Prepare draft minutes for approval by the chairman before the final write up.
3. Typing of correspondence resulting from the meeting.

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