Moin-Ul-Atiq

Today’s talk

• What is Management?

• Historical Background of management

• Early Years Approaches includes – Classical approach, Human resource approach and quantitative approaches

• Fredrick's 4 Principles

• Henry 14 Golden rules

• Recent Years Integrative Approaches includes– Process– System – Contingency

•

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What Is Management ?

• The term refers to the process of getting activities done efficiently and effectively with and via people

• Coulter Robins 2004

• The process of getting activities completed efficiently with and through other people; 2. The process of setting and achieving goals through the execution of five basic management functions: planning, organizing, staffing, directing, and controlling; that utilize human, financial, and material resources.

• Mark Shead2009

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Historical Background: Management

• Organized endeavors or effort directed by people responsible for Planning, organizing, leading and controlling activities have existed for thousands of years.

• The Egyptian pyramids and the Great Wall of China for instance are tangible evidence that projects of tremendous scope, employing tens of thousands of people, were undertaken well before modern times.

• The pyramids are particularly interesting example.

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Continued

• The construction of a single pyramid occupied more than 100,000 workers for 20 years. Who told each worker what to do?

• Who ensured that there would be enough stones at the site to keep workers busy? The answer to such questions is manager.

• What was to be done organize people and material to do it Regardless of what managers were called at the time someone had to plan what was to be done, organize people and material to do it and direct the workers and impose some controls to ensure that everything was done as planned.

• So this is all about the management and from recent times the daily routine worked resulted in the modern management.

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Continued

• These examples from the past demonstrate that organizations have been with us for thousand of years and the management has been practiced for an equivalent period

• In 1776 Adam Smith published a classical economic doctrine, ‘The wealth of Nations” in which he argued the economic advantages that organizations and society would gain from the division of work, Master Slave Relationship Concept means performance which is based on 2 principles

1. As mentioned above division of labor/ work

2. Replacing humans with machines

• Smith concluded that Division Of Work increased productivity by increasing each worker's skill dexterity, by saving time,

• For example an assignment is to be completed by a group of for members

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THE EARLY YEARS

• Early years : The management divide into 3 approaches:

1. Classical Approach…

2. Human Resource approach

3. Quantitative approach

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THE EARLY YEARS

• Classical Approach…further divide in2 two approaches

1. Scientific Management …….Fredrick Taylor has discussed the 4 principles to achieve the goals effectively and efficiently:

1. Developing specialize task.. What is to be done / who will do, manager should know on the basis of passion/ personality traits

• Hiring and teaching individuals……..teach them how to perform e.g. NCA • Cooperativeness with each other…… team work• Divide work equally

2. General Administrative Theorists

• Henry Fayol and Mex Weber are the main persons of GA concepts • On the basis of the above 4 principles of Fredrick, Henry expanded these princi• ples into 14 principles • Next slide

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Golden Rules of Henry Fayol

1. Division of work/ Labor…….Specialization increases output by making employees more efficient

2. Authority:…….. • Dhoni Vs Kumble… Authority is exercised responsibility arises.

3. Discipline:• employee must obey and respect the rules that govern the organization• Happy atmosphere having good results

4. Unity Of Command: • Every employees should get order or work from one person, too many captains lead to

disaster

5. Unity of Direction:….. • Car example only comes every single employees know the firms goal if concealing the data

conflict arise

6. Subordination of individuals interest to the general interest• Zardari/ Ejazz Butt… many More

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Golden Rules of Henry Fayol

7. Remuneration……. Pay scale must be justified

8. Centralization…….. Varies situation to situation mashwara

9. Scalar chain……… Communication is important EVS system

10. Order……………….people and material should be in the place at the right time

11. Equity………………Managers should be Kind and fair enough to their subordinates

12. Stability of tenure of personnel……manager make sure that appropriate replacement are available . Muhammad Asif , M Amir

13. Initiative……………Always welcome ideas

14. Espirit de Corps……promoting team spirit will build harmony and unity within organization

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Human Resource Approach

1. Early Advocators

1. Late 1800 to early 1900s normally the children under 13 worked 13 hours, with miserable working conditions but few individuals Chester Barnard , Bell company president debate that Hawthorne study does not work [properly human relationships are more important than any thing else

2. Hawthorne study

1. A series of studies during the 1920’s environment has a great reflection on performance.2. For example Agha Khan Hospital

3. Human relations movement

1. Maslow Theory……. Driver perform well when his basic needs are fulfilled2. Douglas McGregor sets 2 assumptions about human nature Theory X …. Negative view of

people and Theory Y he suggested that T Y is fruitful The Holy Prophet Sallallaho Wassalamthan

T X

4. Behavioral science1. Based on sociology and psychology of the human2. Makro London3. Eastkil Bride Glasgow Moin Vs Bryan

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Quantitative Approach• After world war 2 many quantitative techniques applied to military problems

but 1n1940s a military man joined ford motor company immediately using quantitative methods to improve decisions making process.

• Recent years integrative approaches:

1. Process1. This approach initially originally introduced by Henri Fayol is based on Management functions

2. System

1. The main purpose is communicate must be integrated with different department…….horizontal….vertical

2. 2 basic types of system does work in the organization open system and closed system3. In the contemporary organizations normally open system is working in this system 4. Interact with upstream channels and lower stream channels plus customers, government

agencies, financial institutions …….

3. Contingency1. Reactive approach responding to situational variable as they arise

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Conclusion

Without good management ,not a single organization will get success in the

competitive world

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Firms Business Functions

• Procurement and purchase functions

• HRM functions

• Sales function or revenue function

• Marketing functions

• Financial management and cost control functions

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Financial Management & CCF

• FM/Financial Accounting it as art of book keeping and is different from science, it is just an art and not a science

• In order to standardized financial reporting IASB (international accounting standard board) has issued IAS (international accounting standards) to globalize financial reporting worldwide

– IAS 2(inventory management) purchase 800 to get the licensed copy of all the standard from ICAP

– IAS 16( property plant equipments)

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5 Components Of Financial Statements

1. Statement of comprehensive income / Profit and loss account

2. Statement of financial position or Balance Sheet

3. Statement of changes in equity

4. Cash flow statement

5. Notes to the Accounts

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Income Statement – Function wise

• It represent all the revenue and all the expenses incurred by the small business in an accounting period

• Illustrative Profit and loss account is as follows:• Sales

– (Cost of Goods Sold)

• Gross Profit• Operating cost includes

– (Administrative cost)– (Selling cost)

• Operating profit– (Financial charges)

• PBT (Profit before tax)– (Taxation) for registered firms

• PAT (Profit after tax)

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Income Statement – Cost wise

• Sales– (Cost of Goods Sold)

» Cost of Material Purchased

• Gross Profit• Operating cost includes

– (Administrative cost) includes» Salaries and wages, depreciation, rent, travelling cost of admin. Staff, running cost

of generator, repair and maintenance

– (Selling cost)» Salaries and wages of selling staff, depreciation of sales car, travelling cost

• Operating profit– (Financial charges)

• PBT (Profit before tax)– (Taxation) for registered firms

• PAT (Profit after tax)

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Balance Sheet

• It represent the assets owned by the company on the basis of either debt financing or equity financing.

• At the time of purchasing the business person must record all the entries update the balance sheet.