Management I: Concept, Theories, Functions, Communication, Decision Making and Organisation Design

1. Planning — deciding in advance what, how, when and who: objectives, strategies, policies, procedures, rules, programmes, budgets. Types by level (strategic, tactical, operational), by time (long, medium, short), by repetition (standing versus single-use). Steps: awareness of opportunity, objectives, premises, alternatives, evaluation, selection, derivative plans, budgets. MBO (Drucker, 1954) sets objectives jointly and appraises against them. Planning is primary — every other function follows it.
2. Organising — identifying and grouping work, defining authority and responsibility, establishing relationships: departmentation (by function, product, territory, customer, process, matrix), delegation, decentralisation, span.
3. Staffing — manpower planning, recruitment, selection, placement, training, appraisal, compensation, promotion; the human-resource function seen as a managerial function.
4. Directing — leading, motivating, communicating, supervising; Koontz and O'Donnell's list; the syllabus names coordinating in its place, which Fayol listed as a separate element and Koontz called 'the essence of management' running through all functions rather than a function of its own.
5. Controlling — setting standards, measuring performance, comparing, correcting deviations. Types: feed-forward (before), concurrent (during), feedback (after). Techniques: budgets, break-even, ratios, PERT/CPM, MIS, audits, management by exception. Planning and control are the Siamese twins of management — control without a plan has nothing to measure against.

Communication is the transfer of information and understanding from one person to another. The process (Shannon and Weaver's model adapted to management) runs sender, encoding, message, channel, decoding, receiver, feedback, with noise at every stage. Types are classified by direction — downward (orders, policies), upward (reports, grievances, suggestions), horizontal or lateral (between peers), diagonal (across levels and departments); by channel — formal (chain, wheel, Y, circle, all-channel networks) and informal (the grapevine, in Keith Davis's four patterns: single strand, gossip, probability, cluster — cluster being the most common); by medium — verbal (oral, written) and non-verbal (body language, paralanguage, proxemics, time, silence).

A decision is a choice among alternatives; Herbert Simon called management 'decision making' and the manager a decision maker. His model has three phases — intelligence, design, choice — and his lasting contribution is bounded rationality: managers do not optimise, they 'satisfice', accepting the first alternative that is good enough, because information, time and cognitive capacity are limited. Decisions are programmed (routine, repetitive, handled by rules and procedures, taken at lower levels) or non-programmed (novel, unstructured, requiring judgement, taken at the top); strategic, tactical or operational; individual or group; and taken under certainty, risk (probabilities known) or uncertainty (probabilities unknown). The rational process runs: identify and define the problem, gather information and diagnose, develop alternatives, evaluate alternatives (Drucker's limiting or strategic factor — the one that stands in the way), select the best, implement, and follow up and evaluate.

Authority is the right to command and to make decisions, attached to a position; Weber's three sources are traditional, charismatic and rational-legal, and the formal theory says it flows down from ownership while Barnard's acceptance theory says it exists only when subordinates accept it. Responsibility is the obligation to perform the assigned duty, and it cannot be delegated: authority is delegated, responsibility is created for the subordinate but the superior's own remains, and accountability — answerability for results — flows upward. The principle of parity says authority and responsibility should be equal. Delegation is the entrustment of part of one's work and authority to a subordinate — assignment of duties, grant of authority, creation of accountability — and its barriers are the superior's fear of loss of control and the subordinate's fear of criticism. Centralisation concentrates decision authority at the top; decentralisation disperses it systematically to lower levels, and Fayol treated the degree of it as a matter of proportion. Delegation is between two persons; decentralisation is a philosophy of the whole organisation. Its measure (Ernest Dale) is the number, importance, scope of decisions taken lower down and how little checking they need.

Organisation design is the choice among these structures, and the contingency findings guide it. Burns and Stalker (1961) contrasted mechanistic structures (rigid, hierarchical, suited to stable environments) with organic ones (flexible, lateral, suited to change). Joan Woodward (1965) tied structure to production technology — unit, mass and process — finding successful firms matched structure to technology. Lawrence and Lorsch (1967) showed that firms in uncertain environments differentiated more and needed more integration. Chandler's thesis is that structure follows strategy; Mintzberg's five configurations are the simple structure, machine bureaucracy, professional bureaucracy, divisionalised form and adhocracy, each with a dominant part — strategic apex, technostructure, operating core, middle line, support staff. Formalisation, specialisation, standardisation, hierarchy of authority and centralisation are the dimensions along which any design is measured.