Time in which we live, – an epoch of changes. Our society carries out extremely difficult, in many respects inconsistent, but historically inevitable and irreversible reorganization. In a sociopolitical life it is transition from totalitarianism to democracy, in economy – from command system to the market, in a life of the separate person – its transformation from “clincher” in the independent subject of economic activities. Such changes in a society, in economy, in all our vital way are complex that they demand change ourselves.
The important part of this change as shows world experience, – comprehension of a science and art of management.
In the simplified understanding, management is a skill to achieve objects in view, using work, intelligence, motives of behavior of other people. Management – in Russian “management” – function, a kind of activity on a management people in the diversified organizations. Management is also area of the human knowledge, assisting to carry out this function. At last, management as collective from managers is the certain category of people, a social layer of those who works on management.
And management is considered as process because work on achievement of the purposes with the help of others is not any lump sum action, and a series of the continuous interconnected actions. These actions, each of which in itself is process, are very important for success of the organization. They name administrative functions. Each administrative function too represents process because also will consist of a series of the interconnected actions. Managerial process is a total sum of all functions.
Managerial process (management) has four interconnected functions: planning, the organization, motivation and the control.
• the organization
• the control
Function of planning assumes the decision on what should be the purposes of the organization and that members of the organization should do to reach these purposes.
Strategic planning represents a set of actions and the decisions undertaken by a management which conduct to development of the specific strategy, intended to help the organization to reach the purposes.
Process of strategic planning is the tool assisting in acceptance of administrative decisions. Its problem – to provide innovations and changes in the organization sufficiently. More precisely speaking, process of strategic planning is that umbrella under which all administrative functions are covered.
Essence of strategy.
The word “strategy” has taken place from Greek “strategos”, (art of the general). Strategy represents the detailed all-round comprehensive plan, intended to provide realization of mission of the organization and achievement of its purposes.
The strategic plan should be developed more likely from the point of view of prospect of all corporations, instead of the concrete individual. Though, at the personal enterprises the founder of the enterprise presumes relative luxury to combine to itself personal plans with strategy of the organization.
The strategic plan should be proved by extensive researches and the fact sheet. Effectively to compete in the today’s world of business, the firm should be engaged constantly in gathering and the analysis of huge quantity of the information on branch, the market, a competition and other factors.
The strategic plan gives to firm definiteness, individuality that allows it to involve the certain types of workers, and, at the same time, to not involve workers of other types. This plan opens prospect for the organization which directs its employees, involves new workers and helps to sell products or services.
At last, strategic plans should be developed so that not only to remain complete during the long periods of time, but also to be flexible enough that if necessary it was possible to carry out their updating and reorientation.
Planning and success of the organization.
Some organizations, as well as individuals, can excel the certain level, not spending the big work on formal planning. Moreover, strategic planning in itself does not guarantee success. The organization creating strategic plans, can fail because of mistakes in the organization, motivation and the control.
Process of strategic planning.
Nevertheless, formal planning can create number important and frequently essential favorable factors for the organization.
Modern rate of change and increase in knowledge is so big, that strategic planning is represented by unique way of formal forecasting of the future problems and opportunities. Strategic planning gives a basis for decision-making. Formal planning promotes decrease in risk at decision-making. Planning as it serves for a formulation of the established purposes, helps to create unity of an overall aim inside of the organization.
For strategic planning the following positions are characteristic.
1. The small planning section (less than 6 people) corporations are supplemented with planning at the lowest levels.
2. The age of function of planning even in the largest corporations is totaled less than ten years.
3. Strategic plans are developed at meetings of the top management of the corporation, spent annually.
4. The annual strategic plan is united with the annual financial plan.
5. In the majority of the organizations consider, that function of planning
Can be advanced.
The purposes of the organization. The first and, maybe, the most essential decision at planning will be a choice of the purposes of the organization.
The basic overall aim of the organization – the well defined reason of its existence – is designated as its mission. The purposes are developed for realization of this mission.
Mission details the status of firm and provides a direction and reference points for definition of the purposes and strategy at various organizational levels. Formulation missions of the organization should contain the following:
1. A problem of firm from the point of view of its basic services or products, its basic markets and the basic technologies. Easier speaking, in what enterprise activity the firm is engaged?
2. An environment in relation to firm which defines working principles of firm.
3. Culture of the organization. What type the working climate exists inside of firm? What type of people involves this climate?
To choose corresponding mission, the management should answer two questions: (who our clients?) And (we can satisfy what needs of our clients?) The client in the given context will be anyone who uses results of activity of the organization. Clients of non commercial organizations will be those who use its services and provides with its resources.
Overall aims of firm are formulated and established on the basis of the general mission of the organization and the certain values and the purposes by which the top management is guided. To bring in the true contribution to success of the organization, the purposes should possess a number of characteristics.
1. First, the purposes should be concrete and measurable. Expressing the purposes in concrete measurable forms, the management creates precise base of readout for the subsequent decisions and estimations of a course of work.
2. The concrete horizon of forecasting represents other characteristic of the effective purposes. The purposes are usually established on long or brief time intervals. The long-term objective has horizon of planning approximately equal to five years. The short-term objective in most cases represents one of plans of the organization which should be finished within the limits of a year. The intermediate term purposes have horizon of planning from one till five years.
3. The purpose should be achievable, – to serve increase of efficiency of the organization.
4. To be effective, the plural purposes of the organization should be mutually supporting – i.e. actions and the decisions necessary for achievement of one purpose, should not prevent achievement of other purposes.
The purposes will be a significant part of process of strategic management only in the event that the top management correctly will formulate them, and then is effective informs on them and stimulates their realization in all organization. Process of strategic management will be successful in that degree in what the top management participates in a formulation of the purposes and in what measure these purposes reflect values of a management and a reality of firm.
Realization of the strategic plan.
Strategic planning gets sense when it is realized.
After a choice of basic general strategy she is necessary for realizing, having united with other organizational functions.
The important mechanism of coordination of strategy is development of plans and reference points: tactics, policies, procedures and rules.
Tactics represents concrete short-term strategy. The policy represents the general reference points for actions and decision-making. Procedures order actions which should be undertaken in a concrete situation. Rules specify that it is necessary to do in a concrete situation.
Estimation of the strategic plan.
Development and the subsequent realization of the strategic plan seems simple process. Unfortunately, too many organizations apply a method “to introduce immediately” in relation to planning and catastrophic fail. The continuous estimation of the strategic plan has extreme value for long-term success of the plan.
The estimation of strategy is carried out by comparison of results of work with the purposes. Process of estimation is used as a feedback mechanism for updating strategy. To be effective, the estimation should be carried out is system and is continuous. Properly developed process should cover all levels – from top to down. At an estimation of process of strategic planning it is necessary to answer five questions:
1. Whether strategy of organization internally compatible with opportunities is?
2. Whether evaluate strategy an allowable degree of risk?
3. Whether the organization by sufficient resources for realization of strategy possesses?
4. Whether strategy takes into account external dangers and opportunities?
5. Whether this strategy by the best way of application of resources of firm is?
To organize – means to create a certain structure. The organization is a process of creation of structure of the enterprise which enables people to work effectively together for achievement of its purposes.
The organization of interaction and power.
That plans were realized a management should to find an effective way of a combination of plans, i.e. with optimum result.
The organization as process represents function on coordination of many problems: there are two basic aspects of organizational process:
1. Division of the organization into divisions according to the purposes and strategy.
2. Delegation of powers.
Delegation as the term used in the theory of management, means transfer of problems and powers to the person who takes up the responsibility for their performance.
To understand, how effectively to carry out delegation, – and we shall consider this problem later, – it is necessary to understand the concepts of the responsibility connected to it and organizational powers.
The responsibility represents the obligation to carry out available problems and to be responsible for their satisfactory sanction.
It is important to realize, that delegation is realized only in case of acceptance of powers, and actually the responsibility cannot be delegated. The head cannot wash away the responsibility, transferring its subordinate. Though the person, to whom the responsibility for the decision of any problem is assigned, is not necessary to carry out her personally, it remains responsible for satisfactory end of work.
If it is supposed, that any person will accept the responsibility for satisfactory performance of a problem – the organization should give to it required resources. The management carries out it by delegation of powers together with problems.
Powers represent the limited right to use resources of the organization and to direct efforts of its some employees to performance of the certain problems.
Powers are limited to plans, procedures, rules and oral orders of chiefs, and also factors of an environment, for example, laws and cultural values. Limits of Formal powers are frequently broken owing to authority and the informal organizations.
In some cases limits of powers change character of powers in such significant degree that it is necessary to consider attitudes between levels of authority which are shown as two general types. They are designated as linear and hardware (staff) powers and both types can be applied in various forms.
Linear powers are powers which are transferred directly from the chief to the subordinate and further to other subordinates.
Delegation of linear powers creates hierarchy of levels of management of the organization. Process of creation of hierarchy refers to as scalar process. As powers dispose of people are usually transferred by means of the scalar process, the resulting hierarchy refers to as a scalar circuit or a circuit of commands. So, result of delegation of linear powers is the circuit of commands.
Before to define staff powers, we shall briefly consider an origin of the administrative device.
The administrative device carries out so many functions in the modern organizations, that all cannot be listed them. However it is possible to classify the staff device on two or three basic types, taking into account functions which it carries out. To three types of the device concern the advisory, serving and personal device which is sometimes considered as a variant of the serving device. However it is necessary to remember, that in practice it is seldom possible to lead sharp border between these types.
Classifications of advisory, serving and personal devices describe the staff device according to directions of its use.
Hardware (staff) powers help the organizations to use experts without infringement of a principle of one-man management. Staff powers include recommendatory powers, the obligatory coordination parallel and functional powers. Linear heads frequently possess hardware powers in some areas, and the chapter of the staff device possesses linear powers concerning the device.
Restriction of norm of controllability. The number of the workers submitting directly to the head makes its norm of controllability. If the norm of controllability will not be in appropriate way limited, there will be a mess and an overload of the head. The potential opportunity of mess in powers can be reduced by means of a principle of one-man management – the worker should receive direct orders only from one chief and answer only before it.
Delegation seldom happen effective if the management does not adhere to a principle of conformity according to which the volume of powers should correspond to the delegated responsibility.
Construction of the organizations.
1. It is necessary to choose such organizational structure which corresponds to strategic plans and provides to it effective interaction with an environment and achievement of the planned purposes.
2. The structure of the organization cannot remain constant because varies both external, and its internal environment.
3. The majority of the organizations are used today by bureaucratic structures of management. Traditional structure of bureaucracy is the functional organization at which last is broken into the divisions which are carrying out specialized functions.
4. As only functional structures appeared not too effective, the large organizations went to use divisional structures. The basic types of such structure are divisional structures, Focused or on various kinds of production, or on various groups of consumers, or on various regions. The choice for the benefit of this or that structure is defined by importance of this element in strategic plans of the organization.
5. The structures providing the international branches are used in situations when the volume of foreign sales of firm is rather insignificant in comparison with sales inside of the country more often. When the volume of foreign sales essentially is rising, the most suitable becomes global organizational structure.
6. Advantage of bureaucratic structures of management will consist in clear split of work, hierarchical subordination of employees and controls, the professional growth basing competence, and of the ordered system of rules and the standards determining functioning of the organization. The potential negative influences rendered by bureaucratic structures on functioning of the organization, will consist in rigid zadanosti behavior, difficulties of communication inside of the organization and inability to fast innovations. Scales of these problems quickly grow, if the organization collides with fast changes of an environment or hi-tech production.
7. Some problems of bureaucratic structures can be solved at introduction of organic or adaptive structures. The basic type of adaptive structures is a design organization, the matrix organization and conglomerates.
8. In the design and matrix organization there is an imposing specially created, time target structures on constant structure of the organization. The event thus imposing of powers sometimes leads to struggle for authority, to conformism at development of group decisions and to excessive expenses.
9. Conglomerates will consist of the basic firm and the affiliated companies considered as the separate economic centers. The basic, matrix firm buys and sells daughter enterprises according to the strategy of growth.
10. Many large organizations use the complex compound structure consisting of structures of various types.
11. Within the framework of any structure it is possible to emphasize on decentralization to give subordinate heads the right to make the important decisions. Potential advantages of such scheme consist in improvement of interaction and information interchange between a management of different levels (i.e. on a vertical), increase of efficiency of decision-making process, amplification of motivation of activity of heads, improvement of preparation of heads of different levels. Decentralized structures are usually expedient for applying when the environment of the organization is characterized by the dynamical markets, a competition and also quickly varying technology. The expediency of introduction of such structures also grows in process of increase in the sizes of the organization and its complexity.
12. If changes in an environment occur rather slowly, and the organization is rather insignificant, for it there can be preferable a centralized structure of management. Advantages of the centralized structure will consist in economically effective utilization of the personnel, a high degree of coordination and the control over the specialized kinds of activity and in reduction of probability of that divisions will start to grow to the detriment of the organization as a whole.
13. To use advantages of specialization effective integration of the organization is necessary. For integration of the organizations working in a steady environment and using technologies of mass production, the methods connected to development and an establishment of rules and procedures, hierarchical structures of management approach. The organizations working in more changeable environment and using various technological processes and technologies of release of separate products, frequently count more correct to carry out integration by an establishment of individual interrelations, the organizations of work of various committees and carrying out of meetings between departments.
At planning and the head defines the organizations of work that the given organization, when as well as who, in its opinion, should make it particularly should execute. If the choice of these decisions is made effectively, the head receives an opportunity to embody the decisions in affairs, putting into practice main principles of motivation.
The motivation is a process of prompting of and others to activity for achievement of the personal purposes or the purposes of the organization. Regular studying of motivation from the psychological point of view does not allow to define precisely, that induces the person to work. However research of behavior of the person in work gives some general explanations of motivation and allows creating pragmatical models of motivation of the employee on a workplace.
Various theories of motivation divide on two categories: substantial and remedial.
However, to understand sense of the theory of substantial and remedial motivation, it is necessary to acquire sense of basic concepts all over again: needs and compensations.
Needs is the realized absence something causing prompting to action. Primary needs are incorporated genetically, and secondary are developed during knowledge and finding of life experience.
Needs cannot be observed or measured directly. It is possible to judge their existence only on behavior of people. Needs serve as motive to action.
The simplified model of motivation of behavior through needs.
The need can satisfy with compensations. Compensation is that the person considers for itself valuable. Managers use external compensations (monetary payments, promotion) and internal compensations (feeling of success at achievement of the purpose), received by means of the work.
Substantial theories of motivation.
Substantial theories of motivation first of all try to define the needs inducing people to action, especially at scoping and maintenances of work. At a bookmark of bases of modern concepts of motivation works three people had the greatest value: Abraham Maslou, Frederic Hertzberg and David MakKlellanda.
According to theory Maslou five basic types of needs (physiological, safety, social, success, and self-expression) form hierarchical structure which as dominants defines behavior of the person? Needs of highest levels do not motivate the person, needs of the bottom level are not satisfied yet, at least, in part. However this hierarchical structure is not absolutely rigid and strict.
Hierarchy of needs on Maslow.
The managers working on international scene, as well as their colleagues working inside of any country, should provide opportunities for satisfaction of needs of employees. As in the various countries relative importance of needs is defined differently, heads of the organizations working at the international level, should know these distinctions and take them into consideration.
Though, apparently, the theory of human needs Maslou has given heads rather useful description of process of motivation, the subsequent experimental researches have confirmed her not completely.
Believing, that the classification of needs offered Maslou, not full, MakKlelland has added her, having entered concept of needs of authority, success and an accessory.
The need of authority is expressed as desire to influence other people. Verandah hierarchical structure Maslou the need of authority gets somewhere between needs for respect and self-expression. Management very much frequently involves people with need of authority as it gives many opportunities to show and realize her.
The need of success also is somewhere in the middle between need for respect and need for self-expression. This need is satisfied not with declaration of success of this person, that only confirms its status, and with process of finishing of work before successful end.
In second half 50th years Frederic Hertzberg with employees has developed one more model of motivation based on needs.
Hertzberg has come to the conclusion, that the factors working during work, influence satisfaction of needs. Hygienic factors (the size of payment, a working condition, interpersonal attitudes and character of the control over the immediate superior), only do not allow to develop to feeling of a dissatisfaction with work. For achievement of motivation it is necessary to provide influence of motivating factors – such, as sensation of success, promotion, recognitions on the part of associates, the responsibility, and growth of opportunities.
Remedial theories of motivation.
Substantial theories of motivation are based on needs and the factors connected to them determining behavior of people. Remedial theories consider motivation in other plan. In them how the person distributes efforts for achievement of the various purposes and as chooses a concrete kind of behavior is analyzed. Remedial theories do not challenge existence of needs, but consider, that the behavior of people is defined not only them. According to remedial theories the behavior of the person is also function of its perception and the expectations connected to the given situation, and possible consequences chosen him such as behavior.
There are three basic remedial theories of motivation: the theory of expectations, the theory of validity and model of Malt liquor – Louder.
The theory of expectations is based on the assumption, that the person directs the efforts to achievement any purpose only when will be confident a high probability of satisfaction for this account of the needs or achievements of the purpose. The motivation is function of the factor of expectation (expenses of work – results), expectations – (results – compensation) and valences (i.e. a relative degree satisfaction). The most effective motivation is reached, when people trust, that their efforts will necessarily allow them to reach the purpose and will lead to reception of especially valuable compensation. The motivation weakens, if the probability of success or value of compensation is estimated by people is low.
Within the framework of the theory of validity maintains that, that people subject to value judgment the attitude of compensation to the spent efforts and compare it that as they consider, other workers for similar work have got. Unfair, by their estimations, compensation leads to occurrence of a psychological pressure. As a whole if the person counts the work not evaluated, it will reduce spent efforts. If it counts the work overvalue it, on the contrary, will leave volume of spent efforts at a former level or even will increase it.
The model which has received broad support of Malt liquor – Louder is based that the motivation is function of needs, expectations and perception workers of fair compensation. Productivity of work of the worker depends on the efforts enclosed by him, its prominent features and opportunities, and also estimation him of the role. The volume of spent efforts depends on estimation the worker of value of compensation and confidence that it will be received. According to model of Malt liquor – Louder productivity of work continues satisfaction, and at all on the contrary as supporters of the theory of human attitudes consider.
The control is the process providing achievement of the purposes of the organization. It is necessary for detection and the sanction of arising problems earlier, than they become too serious, and can be used also for stimulation of successful activity.
Process of the control will consist of installation of standards, change of actually achieved results and carrying out of updating in the event that the achieved results essentially differ from the established standards.
The control is a crucial and complex function of management. One of basics features of the control which should be taken into account first of all, will be that the control should be universal. Each head, irrespective of the rank, should carry out the control as an integral part of the official duties even if anybody specially did not charge it to it.
The control is a fundamental element of managerial process. Neither planning, nor creation of organizational structures, motivation cannot be considered completely in a separation from the control. Really, actually all of them are integral parts of the general monitoring system in the given organization. This circumstance becomes clearer after we shall get acquainted to three basic kinds of the control: preliminary, current and final. In the form of realization all these kinds of the control are similar, as have the same purpose: to promote that actually received results were as it is possible closer to require. They only differ with time of realization.
Time of realization of the basic kinds of the control.
The preliminary control is usually realized in the form of the certain policy, procedures and rules. First of all it is applied in relation to labor, material and to financial resources. The current control is carried out, when work already goes and is usually made as the control of work subordinated by its immediate superior. The final control is carried out after work is finished or time allocated for it has expired.
The current and final control is based on feedback. Managing systems in the organizations have an open feedback as the executive being in relation to system an external element; can interfere with its work, changing both the purposes of system, and character of its work.
Process of the control.
During the control there are precisely distinct three stages: development of standards and criteria, comparison to them of real results and acceptance of necessary adjusting actions. At each stage the complex of various measures is realized. The first stage of process of the control is an installation of standards, i.e. the concrete purposes giving in to measurement having time borders. For management in the form of parameters of productivity of object of management standards are necessary for all its key areas which are defined at planning.
At the second stage of comparison of parameters of functioning with the set standards the scale of maximum deviations is defined. According to a principle of the exception, only essential deviations from the set standards should cause operation of the monitoring system, differently she becomes uneconomical and unstable.
The following stage – measurement of results – is usually most expensive. Comparing the measured results with the set standards, the manager receives an opportunity to define, what actions are necessary for undertaking.
Such actions can be changes of some internal variables of system, change of standards or non-interference to work of system.
Behavioral aspects of the control.
People are the integral element of the control, as, however, and all other stages of management. Therefore by development of procedure of the control the manager should consider behavior of people.
Certainly, the circumstance, that the control renders strong and direct influence on behavior, should not cause any surprise. Managers frequently intentionally do process of the control deliberately seen to affect behavior of employees and to force them to direct the efforts to achievement of the purposes of the organization.
Unfortunately, though the majority of managers well know that process of the control can be used for rendering positive influence on behavior of employees, the some people forget about opportunities of the control to cause inadvertent failures in behavior of people. These negative phenomena frequently are by-product of presentation of action of the monitoring system.
The control frequently renders strong influence on behavior of system. Unsuccessfully designed monitoring systems can make behavior of workers focused on them, i.e. people will aspire to satisfaction of requirements of the control, instead of over achievement of objects in view. Such influences can lead to delivery of the incorrect information also.
The problems arising owing to influence of the monitoring system, it is possible to avoid, setting intelligent comprehensible standards of the control, establishing bilateral communication, setting intense, but achievable standards of the control, avoiding the excessive control, and also remunerating for achievement of the set standards of the control.
Characteristics of an effective control.
Behavior of people, naturally, not the unique factor determining efficiency of the control. That the control could carry out the true problem, i.e. to provide achievement of the purposes of the organization, it should possess several important properties.
The control is effective if it has strategic character, is aimed at achievement of concrete results, is duly, flexible, simple and economic.
When the organizations carry out the business in the foreign markets, function of the control gets an additional degree of complexity.
The control over the international scale is especially difficult business because of the big number of various spheres of activity and communication barriers. Productivity of the control can be improved, if periodically to carry out meetings of responsible heads in headquarters of the organization and abroad. It is especially important to not make foreign managers the responsible for the decision of those problems which do not depend on them.
Four functions of management – planning, the organization, motivation and the control – have two general characteristics: all of them demand decision-making, and the communications, information interchange is necessary for all to receive the information for acceptance of the correct decision and to make this decision clear for other members of the organization. Because of it and also because these two characteristics connect all four administrative functions, providing their interdependence, communications and frequently name decision-making by binding processes.
Decision-making is a choice of that as well as what to plan, organize, motivate and supervise. In the most general features it makes the basic maintenance of activity of the head.
The basic requirement for acceptance of the effective objective decision or even for understanding of true scales of a problem is presence of the adequate exact information. Unique way of reception of such information is the communications.
The communications is a process of information interchange, its semantic value between two or more people.