What is Management? Definitions, Features, Functions, Process, Importance

  • Post last modified:12 May 2023
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What is Management?

Management is a process of planning, organizing, actuating, and controlling to determine and accomplish the objectives by the people and resources. Management is the coordination of all resources through the process of planning, organizing, directing, and controlling in order to attain stated objectives.

Organizations have a variety of goals for which they usually direct their energies and resources to achieve these goals. Organizations possess human as well as non-human resources, i.e. – plan, equipment, land, money, etc.

They are put to use in the fulfillment of goals. Management is the force that unifies these resources in the service of organizational goals. It is a process of with and through people. Management is needed wherever people work together in an organization.

The managerial functions include planning, organizing, directing, and controlling by a person who is capable of managing organizing efforts, whether it is a business organization, religious organization, military organization, or a social. These functions are performed at all levels in an organization, regardless of its type or size. The service of management is essential in all types of endeavors.

Definitions of Management

These are definitions of management given by some economists:

Management is a process of planning, organising, actuating and controlling to determine and accomplish the objectives by the use of people and resources.

Terry G

Management is the art of getting things done through and with the people in
formally organized groups.

Koontz. H

Nature of Management

Following are features of management or nature management which discussed below:

Management is goal oriented

The purpose of management in any organization is to achieve the desired goals. These goals should also be achieved through efficiency, i.e. -using best resources, minimum time, and wastage of material. If a sales executive in a company is told to sell 200 units of laptop in each month, at the end of the year, his sales must reach to 2400 units. If he can not achieve, he has to identify the reasons not to achieve his targets/goals.

Management integrates human, physical and financial resources

Any organization need different type of resources to achieve its goal. These resources are in different forms. It can be people – who is the foundation of any organization, finance – life blood of any business or physical resources means technology and other machinery.

At present, information and computer technology are also very important resources for any organization. So combination of all these resources can be helpful to make the organization successful in practice.

Management is a continuous activity

Management is continuous or on going activity. All functions of management – planning, organizing, directing or controlling are performed on continuous basis. One activity of management will stop, other will start, but it never happens that everything will stop at one time.

A manager is doing planning for its production for next season and on other side an advertising department might be working for new advertisement of that product. So, in essence, it can be said that different activities of management continuously goes on.

Management is all pervasive

Management is a universal phenomenon. Management is required in financial planning for personal life and in doing job also. Management is required in business and non-business activity also. It is required in India as well as in other countries like Japan, New Zealand or United Kingdom also.

Understanding of Fundamentals of Management is required to run an educational organization or even to run a hospital also, so management is inevitable in the world.

Management is a group activity

Management is never done by an individual. To have management, any organization needs more people, that is group. People work as an individual for the job what they are assigned to, but to achieve organizational goals, it needs team or group of people. Group work or activity can make the organization goals accomplished.

Management is a dynamic function

George Bernard Show has said “Those who cannot change their minds, can not change anything.” This quotation is very much applicable in business life. There are two types of environment, one is internal – people, machinery etc. and another is external – it includes – government policy, competitors etc.

People of Management has to do continuously keep a watch on both the environment and do changes for the success of their organizational success. Here, if organization would do changes, it would grow or else, it would die.

Management principles are relative, not absolute

This feature indicate that management principles should be applied according to the need of the organization. Each organization is different from the other one. The difference may exist because of time, place, sociology-cultural factors etc.

However, individuals working within the same organization may also differ. Thus, a particular management principle has different strengths in different conditions. Therefore, principles of management should be applied in the light of prevailing conditions of both internal and external environment of the organization.

Management is a science, art and profession

There is a controversy whether management is a science or an art. However, management is both a science and an art, because it has many principles like science and it needs skill like an art. Management is also called profession by many management practitioners, while many have suggested that it has not achieved the status of a profession.

Management is decision-making

Management process needs decision-making at every levels. Decision making basically involves selecting the most appropriate alternative out of the several alternatives available. If there is only one alternative, the question of decision making does not arise.

The quality of the alternative that a manager selects determines the organization’s performance and journey of success. So being a manager, one has to take quality decisions, by taking various factors in mind and give better future to the organization.

In essence, nature of management suggests that

  • Management is goal oriented activity;
  • It is multidisciplinary and pervasive function;
  • It is a dynamic activity;
  • It is a combination of science, art and profession;
  • It is a dynamic activity, where its principles are relative, not absolute;
  • And organization with good management has to achieve its goals with the best use of available resources and quality decisions.

Functions of Management

Function is nothing but the activity of a person in the work. When we connect the word function with management, it becomes management functions. In any organization, there are various departments, like production, finance, marketing, human resource and in all these departments, which management functions are performed by managers?

That is discussed here. Luther Gulick, an American political scientist, was an expert on public administration, has given the functions of chief executive in the acronym POSDCORB. In POSDCORB, each letter stands for Planning, Organizing, Staffing, Directing, Co-ordinating, Reporting and Budgeting.

Koontz and O’donnelhave given five functions of management, they are Planning, Organizing, Staffing, Directing and Controlling. Here, functions of management are discussed based on the functions given by Koontz and O’donnel.

Functions of Management
Functions of Management


Planning is the first activity in the area of functions of management. Planning is nothing but deciding how the entire work will done. It is first function, because a manager has to be clear in the beginning of the work, that how the entire project or activity or task will be done in future.

This clarity will help to managers as well as his subordinates or junior how to proceed in the entire work process. According to Koontz, “Planning is deciding in advance – what to do, when to do & how to do.

It bridges the gap from where we are & where we want to be”. So planning is a systematic thinking about ways and means for future goals and objectives of the organization. Planning is required in every type of organization and in every type of work. It needs good use of intellectual capacity and it is a primary or main function of management.


Organizing is deciding where different types of decisions will be made, who will do what work or task and who will work under whom. Organizing not only related with people, but also related with the distribution of physical, financial, information and other resources of the organization. Organizing process covers the following tasks.

  • List of activities
  • Grouping of activities
  • Assignment of duties and responsibilities
  • Delegating authority and creation of responsibility
  • Coordinating authority and responsibility relationship


Staffing is process of hiring best people for the organization and allotting a specific work based on their skill to perform it. It covers procurement, development. Compensation, integration and maintenance of people in the organization to achieve individual, organizational and social goals. Staffing function is also known as human resources management. Staffing function includes.

  • Good manpower planning
  • Recruitment, Selection and Placement processes
  • Training and Development activities
  • Compensation planning
  • Performance Appraisal
  • Promotions and Transfer.


Next logical step after planning, organizing and staffing is directing. The willing and effective cooperation of employees for the attainment of organizational goals is possible through direction. Directing is dealing with relationship or communication between people to influence, supervise, motivate subordinates to achieve the organizational goals. Direction has mainly four elements.

  • Supervision: It is the overseeing the work of subordinates by their supervisor to check that whether work is done in a proper way or not to achieve the objectives of the organization.
  • Motivation: Motivation is inspiring the employees to do the work with great enthusiasm. Here different types of monetary or non-monetary rewards like promotion or company car is offered as a part of motivation.
  • Leadership: It is the function to guide, direct and influencing the employees by a manager to achieve the desired goals.
  • Employee by a manager to achieve the desired goals.  Communication: It is the process of exchanging different types of information, ideas, instructions, opinions among members of the organization, which creates a better understanding between different levels of people in the organization.


Controlling is observing and checking the progress of goal achievement and taking necessary action, when goal is not achieved. This function is used to check the progress of organizational goals and all type of resources – human, finance, machinery etc.

Koontz and O’donell explained that “Controlling is the measurement & correction of performance activities of subordinates in order to make sure that the enterprise objectives and plans desired to obtain them as being accomplished”. This controlling function needs to follow these steps

  • Establishing the standards
  • Measuring the actual performance
  • Comparison of actual performance with standards and identify the deviations
  • Taking corrective action for deviations.

Process of Management

As a process, management refers to a series of inter-related functions. It is the process by which management creates, operates and directs purpose organization through systematic, coordinated and cooperative efforts. According to George R. Terry, “Management is a distinct process consisting of planning, organizing, actuating and controlling, performed to determine and accomplish the objectives by use of people and resources.” As a process, management consists of three aspects.

Management as a social process

Since the human resource is a most 9 key resource among the other resources, so management is concerned with developing better relationship among people. It is the very important responsibility of a manager to develop productive and useful interaction among employees for achieving desired goals.

Management is an integrated process

Management needs to work with all resources – human, physical, financial and information and functions to be linked. To work in practice, all four functions do not work in a sequence or in isolation, but they are interrelated to each other – planning, organizing, staffing, directing and controlling, so it can be said management is an integrated process.

Management is a continuous process

It is a never ending process. Management is concerned with constantly identifying the problem and solving them by taking adequate steps. It is an on-going process, never stops.

Process of Management
Process of Management

Importance of Management

Why management matters ? There are many reasons which indicate why management is very important in study and practice. They are explained here.

Optimum utilization of resources

Management always tries to do best use of their resources – human, financial, physical, information and information technology. This activity would help and contribute in three ways:

  1. It is very helpful in the situation of scarcity of resources.
  2. It reduces the waste of time, money, energy and other resources, when it will be planned and executed properly.
  3. It contributes in achieving individual, group and organizational goals.

In addition to that, those organization who have expert and professional people, can make lot of differences in their resource utilization because of their talent. So good management plays a vital role in best use of limited resources for a company to achieve its goals.

Establishes Sound Organization

Good management produces no overlapping of efforts (smooth and coordinated functions). To establish a sound organizational structure, there is a need to allot the work according to the ability of a person.

Management fills up various positions with right persons, having right skills, training and qualification. All jobs should be cleared to everyone, all these efforts ultimately results into a sound organization.

Development of Resources

Management develops various resources. This is true with human as well as non-human factors. Lawrence Apply has emphasized that, effective management does development of people.

However, most of the researchers for resource development are carried out in an organized way and management is involved in these organized activities. Thus, through the development of resources, management improves the quality of lives of people in the society.

Integrating various Interest Groups

In the direction of organized efforts, there are various groups – like – shareholders, employees, suppliers, customers, government etc. – all these put pressure on each other to bring better output and quality performance. As a result of these combined efforts, all groups are able to get better reward in their respective area and it gives better satisfaction to them and multiplies the activity with better efforts for future.

It Incorporate Innovations

Today, changes are taking place at very high speed in technology, structure and even in society. These all changes pushes to all organizations to become more active and efficient. Business organizations have become primitive to modern and modern to ultra-modern. Therefore they require high degree of specialization, high 11 level of competence and complex technology. All these require efficient management so that organizations work in the most efficient way.

Stability in the Society

Management provides stability in the society by changing and modifying the resources in accordance with the changing environment of the society. In the modern era, more emphasis is on new inventions for the betterment of human beings. These inventions make old systems and factors obsolete and inefficient.

Management provides integration between traditions and new inventories and safeguards society from the unfavorable impact of these inventions, so that continuity with quality and need base development in social process is maintained.

Management and Administration

Different writers and thinkers of management have given different views about the concepts of management and administration. In total, there are three different views, which are explained here.

According to first view of management thinkers:

Points of
1.MeaningIt involves policy making,
formulation of
vision, mission,
objectives and strategies.
It involves executing the
plans and strategies and
carrying out various
activities determined by
the administration.
Who are the
role player ?
Administration is the
function of top
Management is the work
of lower level of
ActivityIt decides the
structure and prepares
the plan.
It directs and controls the

Second view is advocated by E. F. L. Breech, who says that Management is a comprehensive and integrated term.It includes planning, organizing, directing and controlling.It can be classified further into two categories:

1.Administrative Management

2. Operative Management.

Points of
Levels of
management represents
the top level management.
represents the lower
level management
management performs the
functions of formulation
of vision, mission and
It performs the
functions of
execution, directing
and controlling.
Who are
It includes board of
directors, managing
director, general
managers and chief
It involves the
people of middle
level and lower
level managers.

Third view about management and administration is given by Peter F. Drucker:

Points of
ExampleIt is applicable to non-profit
organization like government
organizations, hospitals,
educational organization,
church, military, temple – who
are basically service oriented.
Management is
concerned with
business and profit
making organizations,
e.g. – any business
MeasurementAdministration is measured by
efficiency in rendering
Management is
measured by the
DefinitionGovernance of non-profit
organization is called
Governance of
business organization
is termed

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