business management

Basics of Business Management

The success of any organization relies tremendously on the functioning of its management. Read the following article that discusses this concept in detail.

Management involves handling and controlling the activities of men, machines, material, and money effectively and efficiently. Efficiency refers to getting the maximum output from the available scarce resources, i.e., "doing things right." Effectiveness refers to "doing the right things" to achieve desired business objectives. Every organization works towards achieving some common goals and formulates methods to achieve them. Managers are the people within the organizations who play a vital role towards achieving these goals by monitoring and controlling the organizational activities. Definition It is the process of planning, organizing, leading, staffing, and controlling the activities of various resources within the organization through systemic, coordinated, and cooperative human efforts to achieve business objectives. Functions of Managers They typically perform five basic functions within an organization: Planning It is the process of selecting goals for the organization and designing necessary programs to achieve them. This helps managers to decide the activities to be performed with available resources. Organizing It is the process of assigning and allocating tasks, authority, and resources for enabling the firm to achieve its organizational objectives. Staffing This involves manning the various positions created by the organizing process. It involves activities such as identifying workforce requirements, recruitment, selection, and orientation of new employees. Leading It involves directing, influencing, and motivating employees towards achieving organizational objectives. Controlling The main elements of the control process include establishing the standards of performance, measuring the actual performance, comparing the actual performance with the standards, and taking corrective action in case of deviation. Organizational Hierarchy The size of the organization determines its structure. Responsibilities of a manager differ according to his or her position in the hierarchy. Management can be categorized into three major levels: Top-level The top-level management is responsible for the overall activities of the organization. It establishes plans and goals that influence the business in entirety. Professionals in this category are few in number and mainly occupy the posts of Chief Executive Officers, Chairman, President, Vice-president, Director, etc. Middle-level These professionals are directly responsible for managing the performance of first-level managers. They are responsible for the operational efficiency of various departments in an organization. They hold designations such as Department Heads, Project Leader, Plant Manager, and Divisional Head. First-level Managers at the first-level have the responsibility to manage the performance of the non-managerial personnel in an organization and ensure implementation of operational plans. They are also called supervisors. They are given different titles in different companies, like Foremen, Clerical Supervisor, Technical Supervisor, etc. Management Skills There are four essential skills that are needed by a manager. They are as follows: Technical Skills A person's ability to use methods, processes, and procedures in a specialized field is known as a technical skill. Human Skills They refer to the ability to work with other people as individuals and in groups. They help employees to communicate, motivate, lead, and inspire others in an organization. These skills are equally important for all the levels. Conceptual Skills These are the skills that are required to conceptualize abstract and complex situations. They are essential for top-level managers, as they need to possess a clear understanding of the overall functioning of the organization and relate it to the external environment. Design Skills These are required by top-level managers to find solutions to problems in a manner that would benefit the organization. These professionals should suggest a rational and feasible solution to a problem apart from recognizing it. Managerial Roles In today's turbulent times, a manager has to perform different roles every day, whether it is training his team or handling clients. He has to remain flexible and calm to carry out these roles, irrespective of the situations and tasks. According to management expert, Henry Mintzberg, a manager's functions can be categorized into ten primary roles, classified under the following three categories:
  • Interpersonal (Figurehead, Leader, Liaison)
  • Informational (Monitor, Disseminator, Spokesperson)
  • Decisional (Entrepreneur, Disturbance Handler, Resource Allocator, Negotiator)
Let us understand each of these roles in the following part in brief: Figurehead As the name suggests, he is a person with authority and performs social and legal responsibilities. Leader This involves leading a team from the front, directing and managing the performance of individuals in a team, and choosing and training new employees. Liaison This responsibility emphasizes the importance of networking and building relations within and outside the organization. Monitor This involves gathering industry-related information for bringing in favorable changes, in the business or at the workplace. This also includes tracking team performance individually and combinedly. Disseminator This role encompasses the task of presenting and communicating critical information to the team within the organization. Spokesperson In this role, a manager represents his organization and communicates its goals and agendas to industry-related outsiders; for example, in a conference meet, etc. Entrepreneur This involves envisioning new ideas and choosing the best ones for the progress of the business. Disturbance Handler An organization or team is always vulnerable to unexpected setbacks, and this is where a manager should come to the rescue. This role emphasizes taking charge, handling disputes or problems within the organization, and coming up with right measures. Resource Allocator Correct utilization of resources proves to be more beneficial for an organization than just collecting or having the same. In this role, the manager considers all the factors and determines where to use them, allocates funds, and assigns responsibilities to the staff for their effective usage. Negotiator As the name suggests, this role may require a manager to be a part of or direct negotiations within his team or organization. As mentioned earlier, these responsibilities are a part of day-to-day business activities, and a manager has to balance them well to facilitate the growth of the team or organization in general.

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