Management functions Four management functions can be identified. These were firstly formally set out by Fayol and are Planning, Organising, Directing, and Controlling

Planning

This is the starting point for all management activity. It involves:

- setting clear objectives

- devising strategies to achieve those objectives

Organising

This is essential in order to achieve organisational goals. It involves:

- developing on organisation structure

- creating departments within that structure

- establishing communication networks

Directing

This may be also referred to as coordinating or motivating. It involves:

- finding and training staff for specific tasks

- ensuring they are motivated to perform those tasks

Controlling

This is essential to ensure that organisational goals are achieved. It involves:

- collecting and analysing key management information

- comparing actual with planned performance

- critically reviewing plans and organisational structure

According to Fayol these functions are common to managers at all levels within the organisation, though the emphasis placed on each activity will vary according to their position in the hierarchy.

Table 1 Functions of Management

	PLANNING	ORGANISING	DIRECTING	CONTROLLING
SENIOR MANAGEMENT	Long-term planning and policy decisions Time horizon 5-10 years Determining profit targets.	Determining the basic structure e.g. division, departments. Whether to organise by product or territory.	Provide leadership and motivation Acting as a figure head for line organisation Span of control small.	Measurement of long-term planned against actual performance. Reviewing plans and organisational structure.
MIDDLE MANAGEMENT	Development of detailed operational plans and procedures to attain organisational goals. Time horizon normally 1 year.	Delegation of work to subordinates and coordination of their work. Development of horizontal relationships.	Creating situations where subordinates are motivated to achieve organisational goals e.g. monetary incentives, job rotation, enlargement and enrichment. Span of control 4-9.	Comparison of actual with budgeted results, action to prevent deviation from the budget.
SUPERVISORY MANAGEMENT	Development and implementation of short-range plans e.g. detailed schedules of work. Time horizon 1 week-1 month.	Implementation of work schedules.	Application of motivation and discipline to overcome resistance.	Ensuring that work completed is of the correct quality and on schedule.

In carrying out these functions of management, managers use three broad categories of skills:

1 Technical skills. These embody the ability to use the tools and techniques of a particular profession. Technical skills are of particular importance for supervisors.

2 Human skills. It is difficult to underestimate the importance of the human resource within the organisation. Managers have to work through and rely on their subordinates. They therefore need high levels of inter-personal skills. Human skills are important to all managers.

3 Conceptual skills. This is the intellectual ability to see and understand the whole problem. A manager needs to be able to see first, how factors in a situation are inter-related, and second, how a change in one part will affect the whole. Conceptual skills are particularly important amongst senior managers.

The organisation chart The formal organisation structure may be best represented by an organisation chart, as in Fig. 2, which represents the structure of a typical manufacturing company. This diagram indicates a number of features of organisational structures:

- The grouping of activities, on the basis of function.

- The division of labour. The degree of specialisation by function and technical skills is indicated, both between and within departments.

- The chain of command. The lines of control and responsibility are clearly shown.

- The communications channels.

Fig. 2 Organisational Chart of a Typical Manufacturing Firm

Production Director

Market Research officer

Advertising officer

Product Development

Production workers

Technical Services Manager

Chief Executive

Commercial Director

Personnel Manager

Computer Service Manager

Chief Accountant

Marketing manager

Distribution Manager

Production Manager

Materials Manager

Cost accountant

Internal auditor

Financial Accountant

Production engineer

Supervisors

Sales Manager

There are alternative ways of representing structure in diagrammatic form, but the vertical arrangement remains the most commonly used.

Comprehension

1.4.1Answer the questions using the active vocabulary and Unit 1 Glossary.

1. What is the objective of a private business?

2. What is an organisational structure?

3. How is management best seen?

4. What basic management functions were set out by Fayol?

5. What do you know about Henri Fayol?

6. What does planning involve?

7. What does organising involve?

8. What does directing involve?

9. What does controlling involve?

10. Which three basic management levels can be identified?

11. How does the time horizon for planning change from the top level to the supervisory level?

12. Whose prerogative is to draw long-term, medium-term and short-term plans?

13. How does the organising function at the middle management level differ from those of supervisory level and senior management level?

14. Whose task is to develop horizontal relationships?

15. Whose prerogative is to choose the organisational structure?

16. Why do you think senior managers have a small span of control in performing their directing function?

17. What is the basic element in directing at all levels of management?

18. Can we say that the basic idea of controlling is measuring results against plans, budgets, quality standards and schedules? Why?

19. Which skills are particularly important to supervisors?

20. Which skills are particularly important to all managers?

21. Which skills are particularly important to senior managers?

22. What are the main features of an organisational structure?

23. What managers are directly responsible to the Chief Executive in a typical manufacturing firm?

24. What is Chief Accountant responsible for?

25. What is the chain of command for the marketing manager?

26. What is the chain of command for the production manager?

27. How is the division of labour principle implemented in the organisational chart of a typical manufacturing firm as shown in Fig. 2?