Key Functions and Levels Explained môn Principle of Management | Trường Đại học Quốc tế, Đại học Quốc gia Thành phố Hồ Chí Minh

PRINCIPLE OF MANAGEMENT: CHAPTER 1: POLC
Planning: is the first and the most important function of management
that involves setting objectives and determining a course of action for
achieving those objectives. Planners are essentially the managers who are
best aware of environmental conditions facing their organization and are
able to effectively analyze and predict future conditions. It also requires
that managers should be good decision makers. E xample:
when Coca-Cola wanted to enter Pakistan market, they have
researched about customer needs and preferences goods, competitors,
conditions economic and cultural, and give the suitable strategy. Organizing
: is the function of management that involves developing an
organizational structure and allocating human resources to ensure the
accomplishment of objectives. The structure of the organization is the
framework within which effort is coordinated. The structure is usually
represented by an organization chart, which provides a graphic
representation of the chain of command within an organization. For example
: when a software company wants to develop a new
application, it will have to define employee roles and responsibilities,
divide the work into phrases and timeline, and create communication
channels and coordination between departments.
Leading involves influencing and inspiring others to take action.
Managers who lead well inspire their employees to be enthusiastic about
working to achieve organizational goals and objectives. For example
: A good leader will have the ability to communicate clearly,
listen and respond, resolve conflicts, evaluate and reflect, and create a
positive and supportive work environment. C ontrolling
function requires monitoring performance so that it meets the
performance standards established by the organization. Controlling
consists of three steps—setting performance standards based on the
company’s objectives, measuring and comparing actual performance
against standards, and taking corrective action when necessary. For example
: A manager will have to establish performance standards
and indicators, collect and analyze data, compare actual results with expected results. Levels of Management: T
op-level management
is the head of the organization also known as the
organization’s administrative body. They have the authority and
responsibility relating to maintaining the overall function, image,
direction, and performance of the organization. they make formal long-
term plans and strategies, manage organizational resources, and control middle level management.
Their function: Set the vision, mission, goals, and strategies of the organization.
For example: Chief Executive Officer (CEO)- Chairman.
Middle-level manag ement:
is the position of management hierarchy that
lies between top management and lower management. They are
responsible for implementing the plans and strategies developed by top
management and translating them into their work area. They also oversee
the performance and productivity of lower level managers and employees. Their function:.
- Execute the plans and strategies according to the instruction given by top management.
- Make plans and policies for department or function base on the organization goals.
- Control and train lower-level managers.
For example: Production Manager- Marketing Manager First-line manage ment:
have direct relations with operative employees.
They are responsible for the implementation of works laid down by the middle level.
For example: Supervisors - Foreman - Sales Officers Types of Management Skills Technical Skills
(first-line, employees)
These skills give the
manager knowledge and ability to use different techniques to achieve
what they want to achieve. Technical skills are not related only to
machines, production tools or other equipment, but they are also skills
that will be required to increase sales, design different types of products
and services, market the products and services.
Technical skills are most important for first-level managers. When it
comes to the top managers, these skills are not something with a high significance level.
Conceptual Skills (Top manager)
Conceptual skills enable a manager to use their knowledge or ability for
more abstract thinking. That means they can easily envisage the whole by
means of analysis and diagnosis of the different states. As such, they
would be in a position to predict the future of a business or department as a whole.
Conceptual skills are vital for top managers, as we go from the bottom of
the managerial hierarchy to the top, the importance of these skills will rise.
Human or Interpersonal Skills
( T-M-F equally important)
Human or interpersonal management skills facilitate a
manager’s knowledge and ability to work with people. One of the most
critical management tasks is working with people. Without people, the
existence of management and managers becomes redundant.
These skills enable managers to become leaders and motivate employees
for better accomplishments. Additionally, they help them to make more
effective use of human potential in the company.
---------------------------------------------------------------------------------------- CHAPTER 2 + 3: Strategic planning
is a process that organizations use to determine their
goals and objectives. Strategic planning is usually used for long-term
operations, while tactical and operational planning are used in short-term
goals and resource projection. Tactical planning is a significant part of the
planning process, and it is the step in which employees identify and prioritize their goals.
3 - 5 years: strategic goals (top management, strategy) Tactical plan ning
can be used for many purposes, such as developing
strategies for marketing, designing marketing campaigns, developing
organizational policies, etc. Tactical plans can be used to develop and
measure the functionality of lower-level departments within a company.
2 years - tactical goals (middle management, tactical)
Operational planning
is a process that helps organizations to set goals
and objectives. It also helps them by making sure that they have a
strategy in place for the future. Operational plans are essential for
completing tactical plans. Properly fulfilling tactical plans will result in
completing the overarching strategic plans. Managers can use operational
plans to manage the day-to-day tasks of a department.
6 months - plans (first-line management)
STRATEGIC PLANNING PROCESS: 1. Define mission and vision
Create a mission statement describing organizational values and how intend to reach the vision. 2. Environment analysis (SWOT)
Gathering data from internal and external environments and respective
stakeholders takes place at this time. Involving employees and customers in the research.
*External: Macro (PEST) Opportunities and Threats +
Political factors
: These factors determine the extent to which a
government may influence the economy or a certain industry.
For example, a government may impose a new tax or duty due to which
entire revenue generating structures of organizations might change. +
Economic factors
: These factors are determinants of an economy’s
performance that directly impacts a company and have resonating long term effects.
For example, inflation, which is a rise in the general level of prices and a
decrease in the purchasing power of money. + Social factors :
These factors scrutinize the social environment of the
market, and gauge determinants like cultural trends, demographics, population analytic, etc.
An example of this can be buying trends for Western countries like the
US where there is high demand during the Holiday season. +
Technological factors
: These factors pertain to innovations in
technology that may affect the operations of the industry and the market favorably or unfavorably.
For example: The internet and social networks are technologies that
allow users to connect, exchange, and share information. In addition, it
has also opened up new marketing, sales, and distribution channels for businesses. Task environment:
1/ supplier: the providers of production or service materials
2/ customers and buyers: pays money for the organization’s products and services
3/ competitors and new entrants: understand the competitive position in the industry
4/ regulators: are units which have the potential to control, legislate or
otherwise influence an organization’s policies and practices
Take MC Donald for an example:
Competitors of McDonald: Burger King - Starbucks - Dairy Queen
Customers of McDonald: Individual customers
Suppliers of McDonald: Coca cola - packaging manufacturers
Strategic Partners of McDonald: Walmart - Disney
Regulators of McDonald: Food & drug Administration
*Internal environment: Strengths and Weaknesses
The organizational internal factors such as goals, policies, resources,
structure, culture, etc. are the source of strengths and weaknesses that
resides in different functional units such as HR, marketing, finance,
production, accounting, and R&D.
BOD: Board of Directors is corporate body who is in charge and
responsible collectively in carrying out the Company’s management and
representatives of the shareholders’ meeting elect top management and manage them.
Founders: The founder of an institution, organization, or building is the
person who got it started or caused it to be built, often by providing the necessary money.
Top management: is the head of the organization also known as the
organization’s administrative body. They have the authority and
responsibility relating to maintaining the overall function, image,
direction, and performance of the organization..Top-managers does make
formal long-term plans and strategies, bring coordination to the
organization, manage organizational resources, and guide & control other lower managerial positions.
3/ Set the strategic goals: BSC ( Balance Score Card)
BSC is a strategic management model that helps business measure and
evaluate their performance according to four main metrics: financial,
customer, internal processes, and learning and development.
For example: A manufacturing business can use the BSC to improve
product quality, reduce production costs, increase sales and profits, and
enhance customer satisfaction and loyalty. Some possible indicators are:
product defect rate, production time, sales revenue and net profit.
4/ Develop alternative strategies - Corporate level: + Merge + Acquisition + Diversification - Generic strategies: + Differentiation + Cost leadership - Company levels: + Market penetration + Market development + Product development
5/ Select the most appropriate strategy to implement.