Principles of Management and Total Quality Management Unit I – Planning Prabhu Krishnamurthy Assistant Professor KCT Business School

Objectives Understand managerial functions such as Planning, Organizing, Staffing, Leading and Controlling Understand TQM concepts and Tools

Management - Definition Art of getting things done by others - Mary Parker Follett To forecast, plan, organise, command, coordinate and control - Henry Foyal (Father of Modern Management)

Management - Definition Process consisting of planning, organizing, actuating and controlling, performed to determine and accomplish the objectives by the use of people and resources - George R Terry Planning – thinking in advance on the actions to be performed Organizing – coordinating human and material resources of the organization Actuating – motivating and directing the subordinates to perform the tasks efficiently and effectively Controlling – ensuring there is no deviation from the plan Finally, this definition states that the management involves the act of achieving the organization’s objectives.

Frederick Winslow Taylor American Mechanical Engineer Focused on industrial efficiency through scientific techniques (7) Referred as Father of Scientific Management One of the first few Management Consultants 1. Work Study Time study – recording the time of commencement and completion of the several elements of a job. Motion Study – studying the motions / actions performed by the worker when performing the job. 2. Application of scientific methods: Observation and recording of the facts of a problem – situation with a view to determine the best method to perform a job. 3. Incentive method: Differential piece wage rate – One for the worker achieved or exceeded the standard output. The other for the standard worker. 4. Principles of Management: Developed theory on functional authority. 5. Experiments: Shovelling – different sizes of shovels for different types of materials Metal cutting – most effective way of cutting metals while keeping them cool 6. Standardization Cost and time for each piece of work – optimum processes of production for different products 7. Mental revolution Workers and managers had to work in harmony for mutual progress and prosperity. (1856 -1915)

Henry Foyal French Industrialist Principles of Administration to be applied in any field of organized activity Focus provided on top management 14 principles of management Referred as father of Modern Management 14 Principles of Management 1. Division of Work 2. Authority and Responsibility 3. Discipline 4. Unity of Command 5. Unity of Direction 6. Sub-ordination of individual interest to group interest 7. Remuneration of personnel 8. Centralization 9. Scalar Chain 10. Order 11. Equity 12. Stability of tenure of personnel 13. Initiative 14. Esprit de corps (Loyalty and Devotion) (1841-1925)

Mary Parker Follett American Social Worker and Management consultant Focused on psychology behind group actions Referred as Mother of Scientific Management She admonished overmanaging employees, a process now known as micromanaging, as “bossism”. She felt that business ought to promote unity of society . She believed that the principle executive of an undertaking should be less of an autocrat and more of a coordinator and organiser of the skills of other men– a skill which would give him authority in the matters in which he was an expert. (1865-1933)

George Elton Mayo Australian psychologist, sociologist and organization theorist Focused on workers attitude Raising productivity level (1880 - 1949)

Management - Qualities Dynamic and life giving element Coordinates current activities and plan future ones Arbitrates disputes and provides leadership Dynamic and life giving element – No business runs on its own, even on momentum. Every business needs repeated stimulus or encouragement and support from the management. Hence, management is dynamic and life giving element without which resources will remain as mere resources and there will be no production. Ex: Breathing in different environment; Watering a plant; Refueling the vehicle; Sleeping (to manage one’s system in shape) etc

Management - Importance Accomplishment of Group Goals Efficient running of an organization Sound organizational structure Accomplishment of Group Goals - Sound resource planning - Changing needs - Consistent direction and control Efficient running of an organization - Management involves its employees mentally and emotionally - Involvement creates motivation - Motivation results in quality output, increase in productivity and reduction in wastage Sound Organizational Structure - Creates organization structure - Defines authority and responsibility - Staffing with appropriate skills - Environment

Management - Functions Planning Organizing Staffing Directing Leading Controlling

Functions - Planning Looking ahead and preparing for future Process of deciding business objectives and identifying methods to accomplish What is to be done? How and where is it to be done? Who is to do it? How results are to be evaluated? Is a function performed by managers at all levels – Top, Middle and Supervisory

Functions - Organizing Require humans and materials Create organization Staffing Success of organization depends on how well it can coordinate the various resources

Functions - Directing Can also be referred as leading, motivating, actuating Involves communication, leadership and motivation Communication – process of passing information and understanding from one person to the other Leadership – process by which manager guides and influences his team members to accomplish certain tasks Motivation – Act of stimulating or inspiring workers Financial – salary hike, bonus, profit – sharing etc Non – financial – job security, promotions, recognition, praise etc

Functions - Controlling Establishing standards of performance Measuring current performance and comparing it against the established standards Taking action to correct any performance that does not meet standards

Concept of Scientific Management Science, not Rule of Thumb : The time and methods of doing any part of the work are fixed objectively. Tools and working conditions arranged scientifically. 2. Harmony, not Discord: Provide adequate remuneration to workers Workers perform their jobs sincerely and enthusiastically Management will gain increased productivity.

3. Cooperation, not Individualism: The Management should promote cooperation between workers and management and between workers. Adopt an enlightened attitude towards workers Acknowledging their importance in raising productivity levels. Provide them Standard Materials, Tools, Working conditions and Training 4. Maximum Output, Not restricted Output For the management, maximum output leads to increased profits. For the workers , it leads to increase in wages and bonus

5. Development of each man to his greatest efficiency and prosperity. Taylor emphasized on Scientific observation of each element of a workers job. Job specialization Proper selection, training and development Planning and Scheduling of work Standardization in operations , working conditions Rewards for efficiency , wage incentives

Elements or Techniques of Scientific Management 1.Work Study Method Study Selection of job to be studied Recording of details of the job and methods employed to perform it. Critical analysis of the job Development of the new method Installation of the new method Maintenance of the new method

Time Study - Using a special watch to note the time of commencement and completion of each of the elements of a job. It necessitates splitting up of a job into number of parts to know how long it takes each of the different workers engaged therein to perform it. Motion Study - Studying the motions performed by a worker while executing a job. Fatigue study - Study of levels of physical and mental exhaustion . Taylor introduced suitable rest intervals as also the optimum size of tools to be used while performing any job.

2.Application of Scientific methods Consists of recording the facts of a problem – situation to determine the best method to perform a job. 3.Incentive method Taylor evolved Differential Piece Wage Rate System One for the worker who achieved the standard output and the other for the standard worker. 4. Principles of Management Taylor developed a theory on Functional Authority (Functional Foremanship). Everything in the organization had to be done by a plan Planning and Execution to be done separately. Profitability and Efficiency is improved through specialised knowledge and skill

5. Experiments Shovelling - Designed different types of shovels for different types of materials. Metal cutting – Designed most effective way of cutting metals while keeping them cool. 6. Standardisation - There are predetermined standards such as task , methods, material , quality and time. 7. Mental Revolution For Effective management workers and managers had to work in harmony , not as two hostile groups but as partners in mutual progress and prosperity.

Merits of Scientific Management For Business Reduction in Costs Production Planning and Controlling Standardisation Rise in Profits For Workers Improved working conditions Improvement in Standard of living Free training For Society Increased Production Industrial peace Greater Economic Prosperity