Nature And Functions Of Management

What is management ?

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

Management is the force that unifies resources in the service of organisational goals. It is a process of getting results with and through people.


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
Management unifies all resources
Management unifies all resources

Nature of Management

Management is related to regulating human and physical resources in order to achieve organisational goals.

The nature of management can be highlighted as:

Management is Goal-Oriented

The accomplishment of several management activities advances by its appearance of its planned aims or objective. Management is involved in descriptive action. It continues a facility which supports the operation of communal as well as corporal revenues to fulfil the pre-determined approaches.

For simulation, the objective of a business is to claim maximum customer engorgement by developing specialty article additionally at feasible charges. This can be apprehended by exercising desirable persons furthermore bringing about favourable usage connectedly minimal reserves.

Management is Goal Oriented
Management is Goal Oriented

Management integrates Human, Physical and Financial Resources

In an organisation, communal presence functions with non-human reserves like instruments, components, financial inventories, frameworks etc. The entire establishment sticks together communal actions with those reserves. It carries about a conspicuous consonance among the communal, corporal as well as financial reserves.

Management is Continuous

Management is basically an on-going approach which encompasses responding of difficulties as well as handling various consequences. It exists while considering the determination of difficulties which will achieve adequate grades to recognize it.

It is analysed that the objective of an establishment continues as utmost development mechanism.various consequences. It exists while considering the determination of difficulties which will achieve adequate grades to recognize it. It is analysed that the objective of an establishment continues as utmost development mechanism.

Management is all Pervasive

Management continues imperative in conclusive categories of organisations whether it continues political, communal and cultural or business which will handle and commands complex behaviours towards a perfect approach.

We see that clubs, hospitals, political parties, colleges, hospitals, business firms all require management. If more that an individual person is engaged in common work, then under such situation, management plays an important role. It is immaterial of the small firm in trading or large firm, all requires management.

Management is a Group Activity

Management is not as concerned with individual efforts as it is about groups and team work. It involves the use of teamwork to achieve predetermined goal of management.

Principles are Dynamic in Nature

Principle is a fundamental truth, which establishes cause and effect relationships of a function within a set- up. Based on integration and supported by practical evidences, the management has framed certain principles.

However, these principles are flexible in nature and keep changing with the environment in which the organisation exists. Because of the continuous development in the field, many older principles are replaced by new principles. Continuous researches are being carried out to establish principles in changing society and no principle can be regarded as a final truth. In fact, there is nothing permanent in the landslide of management.

Principles are Relative, not absolute

Management principles are relative, not absolute and they should be applied according to the need of the organisation. The organisational difference between organisations may exist because of time, place, socio-cultural factors, etc.

However, individuals working within the same organisation 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. Allowance must be made for different changing environment.

Management is a Science, Art and Profession

There is a controversy whether management is science or art. However, management is both a science and an art because it follows principles of science and requires the skills of an art. Management has been regarded as a profession by many while many have suggested otherwise.

Management is Decision-Making

Management process involves decision making at various levels. This usually includes delegation of work. 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 organisations performance and the future of the entire organisation rests on the degree of right decisions are made by this class of executives. Therefore, the success or failure of managers can be judged by the quality of decisions that they make.

The nature of management suggests that:

  • It is a multidisciplinary phenomenon.

  • Its principles are flexible, relative and not absolute.

  • It is both science and art.

  • It can be taken as a profession.

  • Finally, it is universal.

  • It is an organised activity involving decision making, with existence of objectives.

It is working with the people, through establishing goals by utilising available resources.

Management as a Process

When considering management as a process, management refers to a series of inter–related functions. It is the process by which management creates, operates and directs purposive organisation through systematic, coordinated and cooperative human efforts.

According to George R. Terry, “Management is a distinct process consisting of planning organising, actuating and controlling, performed to determine and accomplish stated objective by the use of human beings and other resources.” As a process, management consists of three aspects:

Management is a social process

Since the human factor is most important among the other factors, management is concerned with developing relationships among people. It is the duty of the management to make interaction between people productive and useful for obtaining organisational goals.

Management is an integrating process

Management undertakes the job of bringing together human physical and financial resources so as to achieve the end-organisational purpose. Therefore, it is an important function to bring harmony between various factors.

Management is a continuous process

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

Management process
Management process

Management as a Science and an Art

Management is a wide concept which is not restricted to limited region but plays an important role in our everyday life. It begins with self-arrangement and serves as a mixture of planning organising, controlling, directing as well as coordinating. It involves both science and an art which stands clear among them with several strong constituents.

Management as a Science

Management continues as a science in experience which is accurate, scientific as well as correct arrangements possessing as comprehended as well as digested.

Many custodians will acquire a favourable control of assured quantitative mechanisms by encompassing financial as well as geometric documentation along with below scientific as well researched are checked as constituents which is similar as communal stimulation along with the consequence of contradictory incentive systems based on operation of no uniform assignments.

Management as a Science
Management as a Science

It can be called as science since the organisations led to expert handling and monitoring that can achieve better adaptability to have good planning for running and maintaining business goals. Management uses precise measurement, research and planning which makes ‘scientific’ disciplines to gear up in getting faster response.

Management as an Art

We can say that management behaves as an art related to fixed and definite structures, which led to use of creativity, imagination, initiative and invention in the overall sphere of the occupation.

Management is an Art
Management is an Art

We can say that management behaves as an art related to fixed and definite structures, which led to use of creativity, imagination, initiative and invention in the overall sphere of the occupation.

  • Managers will fight for resources from all other organisations with correct skills and methods.

  • Managers should only design that gives great value.

  • Inventors should be rewarded.

  • Purchase apart from what is there and label it again.

  • Combine internal and external products in order to have more value.

  • Retain employees by being successful.

  • Become powerful and challengeable in the market.

Management can be an art if they possess:

  • Logical reasoning with step by step achievement of goals and purposes.

  • Clear and attractive development policies to attain goals.

  • Control of desired resources.

  • Logical design organisation, direction as well as monitoring of activities and resources for particular purposes.

  • Rewarding and Boosting qualities in getting work done.

It is seen that management is a mixture of both economic and cultural activities that aims to be applied everywhere. If the above combination gets disturbed than management will not function properly.

Management Functions

Management can be called off as a social process which is responsible for economic and accurate arrangement along with rules of operation for a particular organisation in fulfilling desired request. This is a dynamic way as it contains several constituents and activities that are different in terms of operations that could be in areas of marketing, finance, purchase, etc.

Instead, such activities are similar among each other as per the different levels of manager status. Logically, it is easy to bifurcate the function of management while practically such can place one above another in nature. Every function will take the shape into other and further will affect the performance.

Functions of Management
Functions of Management

Planning: Planning is the foremost feature of a management which behaves with plans for future course of action and decides for the most correct course of actions in getting fixed goals. According to Koontz, planning is the advance preparation of action to be taken related to any work. This will link from the starting of a phase to the implementation phase.

It is a future direction to be taken which could be worked in problem solving exercises and decision making. It is studied that planning shows related course of action to meet the required goals which involves straight and clear thinking about ways and means for doing fixed goals. Planning serves as a correct usage among human as well as non-human resources.

Organising: Organising is related to involvement of physical, financial, human resources as well as development of productive relationships which appears amongst themselves for obtaining organisational criteria‟s. Henry Fayol relates organisation as arranging a business which will give everything required for working and functioning. Practically, organising a business needs finding and showing human and non-human constituents for organisational arrangements. The process of Organising includes:

  • Exploring activities

  • Classifying activity groups

  • Declaration of responsibilities

  • Delegating authority and responsibility

  • Functioning with authority and coordination

Staffing: It involves association of manpower to support an organisation function. With the advent of new technologies and spreading of business avenues, staffing play an important role in catering services rendered by organisations. The idea of staffing is assign right job for right people. Kootz and O‟Donell explained staffing as manpower involvement in an organisation as per desired selection Staffing involves:

  • Recruitments after planning

  • Processes related to recruitment, selection along with placement

  • Activities related to Training and development

  • Basic remuneration to be offered

  • Appraisals

  • Promotions and transfers

Directing: This is the sector of managerial function which allows organisational methods to work correctly and efficiently in obtaining organisational challenges. This is an inter-personnel concern of a management that influences, guide, supervise and motivate sub-ordinates for obtaining organisational parameters. Direction has the following elements:

  • Supervision: Inspecting the work of sub-ordinates with the help of superiors.

  • Motivation: This involves the work of a superior to inspire, stimulate and encourage with passion to work.

  • Leadership: It is the capability which shows the guidance given by mangers to his subordinate to work in certain direction.

  • Communications: This involves sharing, communicating and passing of related information from one person to another. This serves as a bridge of understanding.

Controlling: It implies measurement of approach against particular standards with alterations in deflection, if any, will make sure the approach of organisational objectives. The idea behind controlling is to make sure that all will come in conformity with particular standards. A good effective mechanism will handle to think about deflection earlier at times when it actually occurs.

Controlling, as per Theo Haimann is basically a mechanism of analysing progress that happens towards particular aims and objectives if required to correct any deflection. Koontz and O‟Donell explained controlling as mechanism that involves correction of activities of subordinates to ensure about enterprise objectives with related plans to get them arrived. Therefore, controlling has the following steps:

  • Establishing constant measures

  • Measure real performance

  • Comparing performances with standards and locating deviations

  • Corrective action

Importance of Management

The importance of management may be traced in the following contexts:

  • Effective Utilisation of Resources: Management tries to make effective utilisation of various resources. The resources are scarce in nature and to meet the demand of the society, their contribution should be maximum for the general interests of the society. The management not only decides in which particular alternative a particular resource should be used, but also takes actions to utilise it in that particular alternative in the best way.

  • Development of Resources: Management develops various resources. This is true with human as well as non-human factors. Lawrence Appley has emphasised that, management is the development of people. However, most of the researches for resource development are carried on in an organised way and management is involved in these organised activities. Thus, through the development of resources, management improves the quality of lives of people in the society.

  • To Incorporate Innovations: Today, changes are occurring at a very fast rate in both technology and social process and structure. These changes need to be incorporated to keep the organisations alive and efficient. Business organisations are moving from primitive to sophisticated. Therefore, they require high degree of specialisation, high level of competence and complex technology. All these require efficient management so that organisations work in the most efficient way.

  • cIntegrating Various Interest Groups: In the organised efforts, there are various interest groups and they put pressure over other groups for maximum share in the combined output. For example, in the case of a business organisation, there are various pressure groups such as shareholders, employees, government, etc. These interest groups have pressure on an organisation. In a more advanced and complex society, more such pressure is on the organisation. Management has to balance these pressures from various interest groups.

  • 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 age, more emphasis is on new inventions for the betterment of human beings. These inventions make old systems and factors mostly obsolete and inefficient. Management provides integration between traditions and new inventions and safeguards society from the unfavourable impact of these inventions so that continuity in social process is maintained.

Management and Administration

According to Theo Haimann, “Administration means overall determination of policies, setting of major objectives, the identification of general purposes and lying down of broad programmes and projects.” It refers to the activities of higher level. It lays down basic principles of the initiative. According to Newman, “Administration means guidance, leadership and control of the efforts of the groups towards some common goals.”

Management involves conceiving, initiating and bringing together the various elements and coordinating, actuating, integrating the diverse organisational components while sustaining the viability of the organisation towards some pre-determined goals. In other words, it is an art of getting things done with the help of others in formally organised groups.

The difference between management and administration can be summarised under two categories:

  • Functions

  • Usage / Applicability

Difference between Management and Administration on the basis of Functions

1.Meaning MManagement is an art
wherein the efforts of others
are redirected to achieve a
particular goal via team
It is concerned with
formulation of broad
objectives, plans and
2.NatureManagement is an executing
Administration is a
decision-making function.
3.ProcessManagement decides who
should do something and
how he should do it.
Administration resolves
what is to be done and
when it is to be done. There
is no questioning them.
4.4 FunctionManagement is a doing
function because managers
get all the work completed
under their supervision.
Administration is a thinking
function because plans and
policies are determined
under it.
5.SkillsTechnical and Human skillsConceptual and Human
6.LevelMiddle and lower level
Top level function

Difference between Management and Administration on the basis of Usage

1.Applicability It is applicable to business
concerns i.e. profit-making
It is applicable to nonbusiness concerns i.e.
clubs, schools, hospitals
2.InfluenceThe management decisions
are predisposed by the
values, opinions, and beliefs
and decisions of the
The administration is
inclined to abide by
public opinion,
government policies,
religious organisations,
customs etc.
3.3 StatusManagement constitutes the
employees of the
organisation who are paid a
fixed monetary remuneration
(in the form of salaries and
Administration represents
owners of the enterprise
who earn return on their
capital invested and
profits in the form of

Practically, there is no difference between management and administration. Every manager is concerned with both – administrative management function and operative management function. However, the managers who are higher up in the hierarchy devote more time on administrative function and the lower level devote more time on directing and controlling worker‟s performance, i.e. management.

Management and Administration
Management and Administration

The Figure above clearly shows the degree of administration and management performed by the different levels of management.

Managerial Skills

Managerial Skills
Managerial Skills

A professional association of practicing managers, the American Management Association, has identified important skills for managers that encompass conceptual, communication, effectiveness and interpersonal aspects. These are briefly described below:

  • Technical skills: Adequate Knowledge of and proficiency in a certain specialised field, such as engineering, computers, financial and managerial accounting or manufacturing is essential.

  • Human skills: This includes ability to serve well individually or in group since the idea is that managers interact directly with people.

  • Conceptual Skills: This involves using logic to solve problems, locating opportunities, finding problems and locating faults. This skill will help in selecting critical information among a lots of data by understanding technology and business structure.

  • Communication Skills: This skill involves transposing thoughts into words or action. It serves to improve image among colleagues and subordinates with interaction involved among various grounds.

  • Effectiveness Skills: This involves contribution or sharing missions or objectives with focus on customer relation, project management and setting and maintaining performance levels.

  • Interpersonal Skills: It involves regulation and mentoring with diversified factors related to people and culture, to help cultivate a network inside an establishment along with commitment and cooperation.

    In today’s demanding and dynamic workplace, employees who are invaluable to an organisation must be willing to constantly upgrade their skills and take on extra work outside their own specific job areas. There is no doubt that skills will continue to be an important way of describing what a manager does. An up gradation of individual skills helps in the overall improvement of the organisation as a whole. It gives it the cutting edge over all other contemporaries.

  • Design skill: Koontz and Weibrich added one more skill to the above list. Design skill is the ability to solve problems in ways that will help the organisation. At higher levels, managers should be able to move beyond perceiving a potential problem. They are expected to design a workable solution to a problem in the light of realities they face. If managers merely see a problem and become problem watchers, they will fail.

Role of a Manager

Interpersonal Role

  • Figurehead: This includes the traditional role akin to that of the head of a big family; these gestures go a long way in building a rapport with the employees. This role would expect the manager to perform duties of welcoming and felicitating dignitaries, going for business lunches and attending important functions of employees.

  • Leader: As a leader, every manager must encourage and persuade his employee to work. He must try to bring together their interpersonal needs with the goal of organisation. He is the sole motivator of the employees working under him which means he must enjoy not just their trust but also their respect.

  • Liaison: In his role as a liaison, every manager must develop contacts outside his perpendicular chain of command to collect information for his organisation.

Informational Role

  • Monitor: As a monitor, the manager has to constantly scan his environment for information, debrief his contacts and his subordinates and decide on unsolicited information, where much of it a result of the network of personal contact developed.

  • Disseminator: In the role of a disseminator, the manager passes some information openly to his subordinates who would otherwise have no access to it.

  • Spokesman: In this role, the manager informs to satisfy various groups and people who influence his organisation. He assures his shareholders of financial performance. He assures consumer groups that the organisation is fulfilling its social responsibilities. He satisfies the government that the organisation is abiding laws.

Decision Role

  • Entrepreneur: In this role, the manager is an idea- seeker who seeks to improve his unit by adapting it to changing conditions in the environment.

  • Disturbance Handler: In this role, the manager is expected to seek solutions of various unforeseen problems – for example if there is a strike, lockdown or a major customer goes bankrupt it is the duty of the manager to find a solution.

  • Resource Allocator: In this role, the manager must divide work and delegate authority among his subordinates. He must decide who will get what.

  • Negotiator: The manager has to spend considerable time in negotiation. As a representative of his company it is the duty of the manager to negotiate with the management for the welfare of the workers, he needs to negotiate with the union leader if there is a strike issue, or the foremen may negotiate with the workers on any grievances they may have.

Levels of Management

convertcase.netIn an organisation, there are certain levels defined by the management wherein each level is confined with its nature and activities involved. The levels of management can be classified in three broad categories:In an organisation, there are certain levels defined by the management wherein each level is confined with its nature and activities involved. The levels of management can be classified in three broad categories:

  • Top level / Administrative level

  • Middle level / Executor level

  • Low level / Supervisory / Operative / First-line managers

It is seen that different levels has different work area and functions. The role of managers at all the three levels is discussed below:

Levels in Management
Levels in Management

Top Management

  • Determines objectives and policies.

  • Designs the basic operating and financial structure of an organisation.

  • Provides guidance and direction.

  • Lays down standards of performance.

  • Maintains good public relations.

Middle Management

  • Interprets and explains the policies framed by the top.

  • Issues detailed instructions.

  • Participates in operating decisions.

  • Trains other managers.

Lower Management

  • Plans day-to-day operations.

  • Assigns jobs to workers.

  • Provides supervision and control over work.

  • Arranges material tools and equipment.

  • Maintains discipline.

Table Points of distinction between managerial levels

Point of
Middle Level
Lower Level
Action FocusA small group of
policy makers
deciding the fate of
an organisation.
Act as a liaison
between top and
lower level people
and manage
activities of other
These managers
are in direct
contact with
RepresentationChief Executive
Officer President,
Chairman Managing
Director, etc.
Functional Heads
Manager, Personnel
Manager, etc.) and
Section Head,
Supervisor, FirstLine manager, etc.
Nature of
They generally
spend most of their
time with peers,
outsiders and to a
lesser extent,
subordinates. A top
manager‟s schedule
is typically hectic
Middle level
managers, as
compared to
supervisors, are far
less physically
active and far more
involved in paper
work and meeting.
Their job is less
hectic, more
reflective and more
Lower level
managers are
physically active,
experience request
interruption, often
shift back and
forth between
tasks and spend
most of their time
with subordinates
and peers caring
for monetary


What is Definition of Management?

It is not easy to define the term management. There are as many definitions of management for the following reasons:facilities, training and development etc.

What is Management and Administration?

According to Theo Haimann, “Administration means overall determination of policies, setting of major objectives, the identification of general purposes and lying down of broad programmes and projects.” It refers to the activities of higher level.

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