Organizational Control

Organizational Control is regulation of organizational activities, so that the performance remains according to the objectives.

Organizational Control has following role  in an organization:-

1. Provides an account of how the organization is performing in accordance with the set objectives

2. Are the different sub-systems and parts working according to their established roles?

3. Organizational control also keeps the organization in a direction

organizational control also serves following purposes 

1. Adapt to Environmental change:- If environment changes, a goal may be irrelevant, obsolete so control function helps to modify the goals itself, second thing is that it helps organization to keep up according to the goals , so control then direction in changing environmental

2.Limit the accumulation of the error: - Small errors may not be serious at the time but with the course of time , these errors may accumulate and become a serious problem.
for example:-

For example, Whistler Corporation, a large radar detector manufacturer, was once faced with such rapidly escalating demand that quality essentially became irrelevant. The defect rate rose from 4 percent to 9 percent to 15 percent and eventually reached 25 percent. One day, a manager realized that 100 of the firm’s 250 employees were spending all their time fixing defective units and that $2 million worth of inventory was awaiting repair 

3. Cope with Organizational complexity:-as the organization grows, it takes on various tasks, productions and it designs becomes complex.
To effectively manage such a complexity in product lines, designs and roles and effective control system is needed.

4.Minimize costs:- Resources are scarce and to be efficient it is necessary to minimize the costs. Organizational control helps in controlling the quality and quantity of resources and thus minimizing costs
of production.

Process of Control-

—  

1.Establish Standards

—  Control standard—a target against which subsequent performance will be compared.Control standards should be expressed in measurable terms.Control standards should be consistent with organizational goals.

Control standards should be identifiable indicators of performance

2.Measure Performance-—  Performance measurement is an ongoing process. Performance measures must be valid indicators (e.g., sales, costs, units produced) of performance.

3.Compare Performance Against Standards-—  Define what is a permissible deviation from the performance standard and—  Utilize the appropriate timetable for measurement.

4.Determine the Need for Corrective Action-   Maintain the status quo (do nothing) or,—  Correct the deviation to bring operations into compliance with the standard, or—  Change the standard if it was set too high or too low

Control System and forms of Organizational Control

Control System explained in this picture is composed of input , transformation and output subsystems. through feedback the corrective action is taken.

Different forms of Organizational control

Preliminary Control- This form of control focuses on controlling the quality and quantity of input resources- human, physical, informational and financial resources. If the quality and quantity of resources used will be good and appropriate, it will be better to ensure the performance according to standards. Preliminary control should be the part of an effective control system.

For example- If a school wants to become the best school, it should take good students through entrance test, good teachers through tough interviews and good educational materials because these are inputs. It will help to control the quality keep the performance according to the objectives.

Concurrent Control- This form of control means focusing on meeting the standards during the transformation process.
Dell computers are produced in assembly line fashion. After assembling each part it is checked that assembled parts are working properly. In this process it is clear that control is going simultaneously with production and assembling of computers.

Post-Action Control-   Checking the quality and quantity of the output or products after production or transformation process.

Organizational control should incorporate control at all type. Inputs should be controlled, transformation process should be controlled and also the feedback of product should be taken and quality should be improved. In Honda , all these control methods are followed.

ORGANIZING

Organizing is the process of identifying and grouping the work to be performed. Organizing is deciding how best to group organizational elements.

Organizing can also be defined as a process of creating a system of authority relationships and task responsibilities.

The process of organizing (creating the organizational structure)  involves following steps:-

1.  Identifying the work:

Organizations perform complex tasks that are beyond the scope of one man capacity to execute and supervise. It becomes necessary to identify the several works, jobs, tasks that are necessary in order to achieve the organizational goals. It helps in concentrating on important activities, avoiding unnecessary duplication, overlapping and wastage of efforts.

Job specialization,

2. Grouping the work:

 in the process of identifying work, numerous of activities are analyzed and found that some are closely related to each other and needed to put together in order to get the work done smoothly. Also some activities are separate in nature and needed to put separately to be done efficiently.

Similar activities are put together in forms of groups/departments. The basis of grouping may be according to some convenience or goal accomplishing ability of the grouping.

3. Establishing reporting relationships between jobs :

After grouping the tasks it is necessary to create relationship among these tasks, because there is an interrelation and complementary relationship of these tasks to achieve the organizational goal. So formal relationship between these tasks is established

4. Delegating authority and responsibility:

Once the different tasks have been identified, someone should be given the responsibility to perform them and also someone to supervise the same. In this stage, managers are authorized to get the work done in their departments/groups. They delegate the various tasks to their subordinates and supervise the same.

5. Coordinating activities among jobs:

After different units/departments are created, the interdependence between these all are established. Departments can coordinate with each other in three manners

Pooled interdependence represents the lowest level of interdependence. Units with pooled interdependence operate with little interaction—the output of the units is pooled at the organizational level.

In sequential interdependence, the output of one unit becomes the input for another in a sequential fashion. This creates a moderate level of interdependence. At Nissan, for example, one plant assembles engines and then ships them to a final assembly site at another plant, where the cars are completed.

Reciprocal interdependence exists when activities flow both ways between units. This form is clearly the most complex

6. Differentiating amongst positions: last step is creating difference between line and staff positions. Line positions (or managers) are directly  responsible for fulfillment of goals, staff positions are in supporting and advising  role.

Span of control

Span of control is number of people who directly report to a manager. In other words it is the  number of people, subordinates who are directly supervised, controlled, instructed and guided by a superior manager.

Span of control is directly related to the closeness of supervision. Narrow span of control , close supervision and wide span of control means lose supervision.

Span of control is directly related to the number of levels in an organization. Narrower the span of control, taller the organization and wider the span of control- flatter the organization.

Factors affecting span of control-

1.       Nature of organization

2.       Nature of work

3.       Complexity of work

4.       If the task requires machine paced, well learned or easily monitored behavior , then the span of control is wider

5.       The ability and personal quality of manager including the capacity to cope with interruption.

6.       Ability and training of staff

7.       The amount of time manager has available from other activities to spend with subordinates.

8.       Effectiveness of communications and control systems.

9.       The physical location or spread of subordinates

Little discussion on span of control:

If the span of control is too wide, it is difficult to a manager to supervise their subordinates, and manager will be stressed. Wide span of control means larger groups of subordinates so there will be possibility of informal grouping , cliques, and informal leaders in these groups that may operate contrary to the policy and plans.

Too narrow span of control results in tall organizations. Also this type of organizing is more expensive because no of managers is increased. There also becomes problem in communication flow because information must pass various layers.

The Delegation Process

Delegation is the establishment of a pattern of authority between a superior and one or more subordinates. Specifically, delegation is the process by which managers assign a portion of their total workload to others.

Reasons for Delegation The primary reason for delegation is to enable the manager to get more work done. Subordinates help ease the manager’s burden by doing major portions of the organization’s work. In some instances, a subordinate may have more expertise in addressing a particular problem than the manager does. For example, the subordinate may have had special training in developing information systems or may be more familiar with a particular product line or geographic area. Delegation also helps develop subordinates. By participating in decision making and problem solving, subordinates learn about overall operations and improve their managerial skills.

Creating accountability

Giving authority

Assigning responsibility

Steps in delegation

Delegation process involves three steps. First, the manager assigns responsibility or gives the subordinate a job to do. The assignment of responsibility might range from telling a subordinate to prepare a report to placing the person in charge of a task force. Along with the assignment, the individual is also given the authority to do the job. The manager may give the subordinate the power to requisition needed information from confidential files or to direct a group of other workers. Finally, the manager establishes the subordinate’s accountability—that is, the subordinate accepts an obligation to carry out the task assigned by the manager. For instance, the CEO of AutoZone will sign off for the company on financial performance only when the individual manager responsible for each unit has certified his or her own results as being accurate. The firm believes that this high level of accountability will help it avoid the kind of accounting scandal that has hit many businesses in recent times

Problems in delegation

Unfortunately, problems often arise in the delegation process. For example, a manager may be reluctant to delegate. Some managers are so disorganized that they are unable to plan work in advance and, as a result, cannot delegate appropriately. Similarly, some managers may worry that subordinates will do too well and pose a threat to their own advancement. And, finally, managers may not trust the subordinate to do the job well. Similarly, some subordinates are reluctant to accept delegation. They may be afraid that failure will result in a reprimand. They may also perceive that there are no rewards for accepting additional responsibility. Or they may simply prefer to avoid risk and therefore want their boss to take all responsibility.

Departmentalization

  The process of grouping jobs according to some logical arrangement, like function(activity), product, customers, location etc.

Logic for departmentalization:

When organisations are small owner can supervise and guide all the employees, but as the organization grows it becomes difficult for owner manager to supervise personally. As a result new managerial positions are created to supervise the work of employees. Employees are not assigned to managers randomly, jobs are grouped according to some logic, plan and people are assigned the work and managers are authorised to supervise them.

So the logic for departmentalization is it helps in coordination and better supervision.

Types of departmentalization –

1. functional 2. Product 3. Customer 4. Geographical

Functional departmentalization:- is grouping of jobs according to similarity of activities. This requires similar set of skills to perform these activities

In order to produce some good or service there are four essential functions that the organisation must perform.

1. The good or service must be developed (research and development activity – R&D department)

2. Something of value must be created. (Production activities)

3. The product and service must be sale and marketed. They must be made available to those who are to use them (Marketing activity)

4. Finance is needed in order to make available resources used in the development, creation, and distribution of the products (financing activity)

Benefits of functional structure:

-          Best use of expert staff

-          Supervision is facilitated in that managers only need to be familiar with a narrow set of skills

-          Coordination inside each department is easy

-          Shared use of expertise

Disadvantages of functional departmentaion :

-          Coordination between departments becomes difficult

-          Slow and bureaucratic decision making

-          Competition between departments for resources

-          Narrow focus to departmental goals and lose sight to organisational goals

-          Accountability and performance difficult to monitor

-          Departments develop their homogeneous work culture

Example of functional departmentalization :-

Britannia Industries, Bata India, Maruti Udyog, MOdi Xerox follow this departmentalization

2. Product departmentalization:

Grouping of activities /roles/jobs around different products. If a company is offering different products it may group the jobs according to these products.

Different specialists come together into separate product departments with collective responsibility for producing a product. Here in each product department , specialists of production, finance, marketing , H.R take joint responsibility . These product departments or organisational units are autonomous from each other,

This form of grouping is used in diversified organizations. In india Hindustan Uniliver, ITC Larsen&Toubro, Siemens, Thremax have been using this model successfully.

Advantage of this departmentalization:

-          All activites related to one product can be integrated and coordinated

-          Speed and effectiveness of decision making is enhanced

-          Performance of individual products can be assessed easily

Disadvantages of this departmentalisation –

-          Managers may focus on their product to the exclusion of the rest of organisation

-          Administration cost may increase due to each department having functional are experts

-          Divisions may become too autonomous

Pic : product departmentalisation

Customer departmentalisation

Grouping of jobs according to respond to and interact with specific customer groups/segments.

Advantage : skilled specialists can deal with unique or customers or customer groups

Disadvantage: Large administrative staffs is needed to integrate activities of various departments.

Planning

 Planning is Process of thinking in advance before doing any thing.Management is all about achieving organisational goals, furtherance of organizational mission.

Goals are what an organisation wants to achieve in a particular time period. Goals are set at each and every level of organization.In every organization, there are three levels of management.

At Top level of management( Board of Directors,Executives, CFOs, CEOs and COOs) strategic goals are set.  At this level, strategic intent directs the formation of strategic goals. In strategic intent, vision, mission, direct the  formation of goals. 

STRATEGIC GOAL AND STRATEGIC PLAN

Strategic goals are concerned with overall profitability, growth, direction of the organization. In spite of being concerned with a particular department, strategic goals are concerned with overall company, corporate.Strategic goals are set for a long time period i.e, for 5-10 years  For example- 

To earn 10% profits annually for next five years.

To reduce costs @ 5% annually for next five years.

To be the no.1 in market in next 5 years.

These goals are not mentioning performance of any departments, rather they are mentioning the direction - to be no. 1 ,and also mentioning the overall profit and cost reductions of the whole company. 

Strategic Planning and strategic plan: - Strategic Plan is outcome of strategic planning process. strategic planning process is as following.

1. Strategic Analysis is carried out.

2.Mission statement is revised or produced.

3.Corporate strategy is developed.

4.Business level is developed.

5.implementation is determined.

6.Strategies and implementation are assessed.

7.Strategic documents are formulated and approved.

Strategic plan consists of following parts:-

1. Mission statement.- Description of product, customer group, technology, and philosophy of an organisation.

2. Corporate strategy- Resource allocation between different businesses, which business to enter and which to exit, how to manage the portfolio of businesses? Corporate strategy is set at corporate level which deals with the organisation as a whole.

3. Business level strategy- Business level strategy is concerned with competition in particular business, industry. Business level strategies deal with how to face the competition?, how to beat the competitors in market. What strategies- cost leadership, differentiation or mix of strategies should be adopted?

4. Program and projects- structures, responsibilities,resources etc.

TACTICAL GOAL AND TACTICAL PLANNING- 

Tactical Goal setting and tactical planning is done at middle level management, by divisional and departmental managers. Tactical goals are formed with the help of strategic goals and strategic plans and are middle range goals covering 3-5 years. 

Tactical goals are set by middle level managers at departmental/divisional levels to support strategic goals, and accomplishment of strategic plans. Every department sets tactical goals for itself ( departmental managers, divisional managers are involved in this exercise.

Tactical goals are what departments wants to achieve in order to accomplish strategic goals and plans. 

For example- A company set a strategic goal  that it has to reduce its cost @ 10% for next five years. now tactical goals are set by different departments describing how much cost reduction is to be done by different departments. like marketing departments sets its cost reduction ratio at 15%,finance sets it @ 5 % , R&D sets it 12% and HR @8%. You can see how these departments set their cost reduction tactical goals so  that strategic goal can be achieved.

Tactical Plan is the plan ( mean and way ) to achieve tactical goal.A plan aimed at achieving tactical goals and developed to implement specific parts of a strategic plan. Tactical goals determine the resource needs and responsibilities at departmental level.

OPERATIONAL GOALS AND OPERATIONAL PLANS:- 

Operational Goals are set at lower level of management, by lower level managers. Operational goals are set for individuals and sub-departments within a department. A supervisor /foreman is a lower level manager who sets operational goals for himself, his team and his subordinates. Operational goals are in form of specific objectives and targets.

Operational plans are detailed description of means and ways to achieve operational goals.

Hawthrone studies

Hathrone studies were conducted by Elton mayo and his associates.

These experiments were conducted in Western Electric’s Hathrone plant near Chicago (1927-32)

The four experiments of Mayo

1. Illumination experiment
2. The relay assembly test room
3. Interview experiments
4. Bank wiring observation

1Illumination Effect:-

The productivity of workers increased both the times when light was increased or decreased.

2. The relay assembly test room experiment

Friendly observation and value given to employees resulted in higher productivity

3. Interview experiments

Revealed the importance of listening to the employees feelings, problems and use of counseling interviews

4. Bank wiring observation

Informal organization

Rate busters

Rate chiselers

Group pressure on individual workers worked stronger than financial incentives.

Importance of Hawthrone experiments

•          Impetus to human relations approach, personnel management and O.B

•          Focus on workers and people’s perspective

•          Informal organizations

Maslow Hierarchy of needs( Under Human Relations Approach)

•          Maslow’s hierarchy suggests that human needs can be classified into five categories and that these categories can be arranged in a hierarchy of importance.

•           A manager should understand that an employee may not be satisfied with only a salary and benefits; he or she may also need challenging job opportunities to experience self-growth and satisfaction

Physiological  needs

•          Things like food, sex, and air, which represent basic  issues of survival and biological function. In organizations, these needs are generally satisfied by adequate wages and the work environment itself, which provides restrooms, adequate lighting, comfortable temperatures, and ventilation.

Security Needs

•          These needs can be satisfied in the workplace by job continuity (no layoffs), a grievance system (to protect against arbitrary supervisory actions), and an adequate insurance and retirement benefit package (for security against illness and provision of income in later life

Belongingnes needs

•          relate to social processes. They include the need for love and affection and the need to be accepted by one’s peers. These needs are satisfied for most people by family and community relationships outside of work and by friendships on the job. A manager can help satisfy these needs by allowing social interaction and by making employees feel like part of a team or work group

Self Esteem needs

•          comprise two different sets of needs: the need for a positive self-image and self-respect, and the need for recognition and respect from others. A manager can help address these needs by providing a variety of extrinsic symbols of accomplishment, such as job titles, nice offices, and similar rewards as appropriate. At a more intrinsic level, the manager can provide challenging job assignments and opportunities for the employee to feel a sense of accomplishment

Self Actualization

•          These involve realizing one’s potential for continued growth and individual development. needs must be met entirely from within the individual.

A manager can help by promoting a culture wherein self-actualization is possible. For instance, a manager could give employees a chance to participate in making decisions about their work and the opportunity to learn new things.

Theory X and Theory Y

Theory X and Theory Y

McGregor’s theory X and Y are opposite to each other. Theory X is more like scientific Management and theory Y resembles to Human relations approach.

Theory Y is positive and optimistic view about workers but theory X is negative and pessimistic view about workers.

	Theory X	Theory Y
	Work is an un- natural activity	Work is a natural activity like eating, sleeping, playing and leisure.
	Workers are naturally lazy and don’t want to work	Workers are not naturally lazy , they want to work in favorable conditions
	Since workers don’t like work there is need of foolproof planning and perfect control to get work from them	Workers need favorable conditions and friendly environment to work
	There is a need of guiding workers at each and every step	Workers are self guided and self directed to achieve their goals.
	Workers don’t take responsibility	Workers want to take responsibility in favorable working conditions
	Workers are  not innovative and good problem solvers	Workers are innovative and good problem solvers.

According to McGregor, Theory Y is most preferable and applicable view for good managers. 

Importance of Management

In this world, resources are limited, but human needs are insatiable.Management has important role to play at society , organisational and individual levels.

At larger context management has following importance for society.

1. Sustainable use of resources- Since civilizations have to satisfy their needs but also to care the needs of next generations, since use of resources should be made in the way that they should not deplete but enough restored and conserved for next generations.
2. Need satisfaction of society- Management is responsible for the functioning of organizations which are established to satisfy the needs of society. Organisations serve the society by offering goods and services to satisfy the needs.
3. Employment to public- Management offers employment to workers.
4. Increased per capita income- By employment people earn their livelihood and their income is increased
5. Improved quality of life- Increased income and good service and production facilities are resulted in good quality of life for people.
6. Management is needed in any type of social organisation regardless of what product it offers.

At organisational level Management is very important because- 

1. It makes efficient use of resources. 
2. Gives organisations a clear purpose and direction
3. No organisation can exist without some sort of 'management' and few people who can take care of managerial roles.
4. Management is a major factor of production like man, machinery, manpower and material.
5. Management brings innovations and new energy in the organisation and prevents the natural decline of an organisation. It means each organisation can go to decline with course of time due to entropy, but this is management who brings innovations and new energy,skills and technology into organisations and prevent them from decline( responsible for maintaining negative entropy

 An individual also needs to manage his daily affairs,career, public and even personal life. Avoidance of management at present times is not possible. It is all pervasive.

Management as art and science

Management as a science:

Management is a science because:

1. As a discipline it is having a systematic collection( or body ) of knowledge, facts, information, theories, principles
2. It uses advance scientific analysis and synthesis of information for forecasting and understanding the situations and problems.
3. It is dependent on systematic scientific inquiry.
4. Like other sciences it also tries to explain, predict and control the behavior of people teams and structure- The organisational behavior , thus it is not only science but applied science
5.  it is based on systematic planning( thinking ) and then execution( doing) rather than doing things with trial and error, in unplanned manner with intuition.

Management is an Art because:

1.  some times managers use intuition, personal mastery and subjective judgments to solve the problems in organisations
2. Managers don't do all the work with prior planning and then doing, rather than they also involve most often in the unplanned work and problems which require their personal experience and use of subjective judgments
3. Managers deal with human being and thus have to understand the emotions, relations with their subordinate employees and team. Dealing with the team and human relations is an based on personal understanding and empathy rather than use of science and laboratory methods. It is totally art of a manager that how to manage the emotions and keep up the team spirit.
4. Getting things done by others: this is what some time called getting results either hook or by crook. This is not the science but art of the manager to achieve the target in anyway.

Management is art as well science:

Above discussed points reveal that management is science as well as art because managers use both methods: 

Managers work in systematic, planned and scientific manner, use the theories of management to get the solution of the problems: so it is a science.

Managers also face situations and problems out of the scope of their plan and then they use their personal skill, mastery and intuition to solve the problem and get the results.

Both the things are practiced by managers and are complementary to each other. Management as science gives managers a scientific orientation and art focus on human aspects and result orientation. Thus management is science as well art both., 

MBA 011 : PRINCIPLES & PRACTICE OF MANAGEMENT
Max. Hours : 40
UNIT I (8 Sessions)
Management: Concept, Nature, Importance; Management : Art and Science, Management As a
Profession, Management Vs. Administration, Management Skills, Levels of Management,
Characteristics of Quality Managers.
Evolution of Management: Early contributions, Taylor and Scientific Management, Fayol’s
Administrative Management, Bureaucracy, Hawthorne Experiments and Human Relations, Social
System Approach, Decision Theory Approach.
Social Responsibility of Managers and Ethics in Managing.
UNIT II (10 Sessions)
Introduction to Functions of Management
Planning: Nature, Scope, Objectives and Significance of Planning, Types of Planning, Process of
Planning, Barriers to Effective Planning, Planning Premises and Forecasting, Key to Planning,
Decision Making.
Organizing: Concept, Organisation Theories, Forms of Organisational Structure, Combining Jobs:
Departmentation, Span of Control, Delegation of Authority, Authority & Responsibility, Organisational
Design.
UNIT III (10 Sessions)
Staffing: Concept, System Approach, Manpower Planning, Job Design, Recruitment & Selection,
Training & Development, Performance Appraisal
Directing: Concept, Direction and Supervision
Motivation: Concept, Motivation and Performance, Special Motivational techniques: Money,
participation, reward systems, Quality of Work Life, Job Enrichment & Morale Building.
UNIT IV (12 Sessions)
Leadership: Concept and Functions, Process and models of Leadership Development, Contemporary
views on Leadership: Transformational-Transactional, Charismatic-Visionary leadership.
Controlling: Concept, Types of Control, Methods: Pre-control: Concurrent Control: Post-control, An
Integrated Control System, The Quality Concept Factors affecting Quality, Developing a Quality
Control System, Total Quality Control, Pre-control of Inputs, Concurrent Control of Operations. Post
Control of Outputs.
.
Suggested Reading:
1. Stoner, Freeman & Gilbert Jr - Management (Prentice Hall of India, 6
th
Edition)
2. Koontz Harold & Weihrich Heinz – Essentials of management (Tata Mc Graw Hill, 5th Edition 2008)
3. Robbins & Coulter - Management (Prentice Hall of India, 9th
Edition)
4. Robbins S.P. and Decenzo David A. - Fundamentals of Management: Essential Concepts and
Applications (Pearson Education, 6th
Edition)
5. Weihrich Heinz and Koontz Harold - Management: A Global and Entrepreneurial Perspective (Mc
Graw Hill, 12
th
Edition 2008)

Competitive Intelligence

Today's Business Environment of organisations is characterized by hypercompetition, where too many organisations are pursuing too little business. There is not enough demand to go around for all providers and services.
The knowledge base and capability to manage in this hyper- competitive world is called Competitive intelligence. It is the process of insight about future scenario and requires that we go from data to intelligence.

for example-
Data- Prices for our products have dropped by 5%
information - It is because of lower labor costs
intelligence- our key competitors is about to acquire new facility in India and that will increase the competition in next year/months.


Difference between data, information and intelligence


Data- Unrelated pieces of information and

Information- Increase knowledge derived by understanding the relation of data.

Intelligence- Organizing information to fully appreciate the implication and impact on the organisation.



Competitive intelligence has some basic forms such as market research and benchmarking. Good Competitive goes beyond simple research. It attempts to answer specific critical questions that can impact the organisations.

1. How is the competitor XYZ is able to to grow XYZ able to grow and capture market share.
2. What new products will competitor ABC develop and when will release this products.
3. What are the core competencies of competitor DEF?
4. Can we compete with new business lines or should we acquire another company to establish our market share.


Competitive Intelligence requires old fashioned analysis and filtering, somewhat like a detective who wants to solve a case- you can't automate the insights derived form C.I. It takes very intense and serious focus in a very short period of time.

Regardless of the tools businesses use, the single indispensable element to C.I is the human factor : the smart experience and instinct that can turn huge collection of dead facts into live intelligence that plays a central part in making business decisions

Competitive intelligence helps in decision making in the illusive and uncertain conditions. Strategy formulation process deals with incomplete options, ambiguous strategic options, difficult to evaluate . Competitive intelligence helps in this process.

Importance of Competitive intelligence

1. Sources of best practices
2. Strategy formulation and strategic analysis.
3. Isolates performance gaps in relation to competion.
4. Helps areas of improvement risks threats opportunities.

Tools of C.I
1.Environmental mapping - five forces model.
2.Organisational Appraisal
3. Wargames
4.Four Concerns analysis

5. Market Research 

6.Bench Marking- 

Imitating the industry leader, comparing resource, capabilities, processes strategy at the industry best practices

.

Management Vs. Administration

Management and administration are the terms used as synonymous in the business.Few people use them interchangeably and few use them as different terms.

Every word has its meaning in its context- American scholars and European scholars have different thinking on Management and Administration.

American scholars like  Oliver Sheldon, Schultz, are having of this view that Administration and Management are two different concepts and have different use in business world. According to these American scholars, Administration is superior than Management because,  it involves thinking,decision making,high level planning, policy and strategy formulation. Management is subordinate or inferior to administration because it is doing or, executing or,and implementing function. Management is responsible for the implementation of the policies and major plans  , strategies laid down by Administration.
Thus according to American view, Administration and management are different, administration is superior than management because management has to follow the policies, plans, strategies, decisions laid down by administration. Administration is concerned with the function of top level managers but management is concerned with middle and lower level.

European scholars like Breach are opposite the American viewpoint. According to them Management is broader and superior than administration because it is responsible for formulation of strategies, policies, plans and higher level decision making and is function of top level managers in the organisation. Administration is inferior to management because it is responsible for implementation of these plans,strategies, policies and installation of systems to execute the decisions of Management( top level managers). Thus management is determinative function and administration is implementing function( Management is thinking and administration is doing).

Management and administration are same: Many writers like Henri Fayol, William Newman, Chester Barnard, George Terry, Louis. A. Allen, Koontz and O’ Donnell make no distinction between management and administration.
According to these scholars, Management and administration both are made on similar set of principles( like henry fayol's 14 principles) and have to perform overall managerial functions(planning, directing, commanding, controlling, coordinating etc.) Management can be classified in to two parts-
1. Administrative Management- Thinking, Planning
2. Operative Management- Implementing
and every manager at each level has to do perform these two functions. So there is no any practical difference between Administration and management.

Henry Fayol: Administrative theory and 14 Principles of Management

Henry Fayol was a French scholar. He was a mining engineer who worked for a French mining company Commentry-Fourchamboult-Decazeville. In his career he attained the highest managerial position of CEO.

He wrote a famous book - 1916 book Administration Industrielle et Generale in French which was translated in 1949 in English. In this classic book he popularized the famous fourteen principles and five managerial functions.

1. Division of Labour

This principle states that work can be performed more efficiently and productively if it is divided into smaller elements and assigning these specific elements to specific workers. This is similar to one best way of doing job as in scientific management and job specialisation in Bureaucracy. Each employee or a group of employee performs a specific task. Division of labour according to job specialisation is the main function.

2. Authority

Authority is the given power ( based on legitimate rule by organization) to an official to issue orders to subordinates and take work from them. This principle states that managers require authority to perform their managerial responsibilities.

3. Discipline

Discipline is related with regulation of behaviour of employees at workplace. Without discipline, authority has no meaning; there should be someone to obey the orders.

This principle suggests that there is requirement of a set of rules and procedures aimed at attaining good employee discipline and obedience.

4. Unity of command

This is the “one man one boss rule”. An employee should receive orders from only one boss only.

If a worker will receive orders from several bosses he will be confused and over burdened. Also there will be a problem regarding reporting.

So this principle emphasizes on only one boss for a worker.

5. Subordination of individual interests to the organizational interest.

Employees must sacrifice their interests for the good of the organization. The organizational goals/ tasks/work would be preferred over interest of worker or group of workers.

Thus an organization should employ only those individuals who are fully committed to its objectives and are willing to readily follow the organization’s mandates/rules.

6. Unity of direction

This principle supposes that there should be only one plan and only one boss for each group of activities having same objectives. This is to ensure that the organization is pursuing it all activities not in contradictory directions but there is alignment between activities.

7. Remuneration of personnel

Fair wages work as a good motivation for employees. Compensation for work done should be reasonable to both – employees and organization and it should be sufficiently motivational, neither overpaid nor underpaid.

8. Centralization

Too much centralization leads to ineffectiveness and so does the decentralization. There should be a balance of centralization and decentralization in organizations.

The best approach to get the balance is top management designs the broader strategy, policies and middle level and lower level of managers interpret and operationalise them to work.

9. Scalar chain

This principle assumes that there should be clear hierarchy in organization from top to down. The flow of communication must follow the hierarchy that it should be strictly vertical.

Horizontal communication is needed only when there is urgent need and permission from superiors has been obtained.

10. Order

Order means doing things in rational and logical manner. There should be a place for everything and everything should be in its place.

An organization’s materials/resources should be at right place at right time, and its employees should be assigned to the jobs best suited to them.

11. Equity

Equity means being kind, fair and just to your subordinates or employees. Equal and fair treatment, impartiality and bias free environment promotes employee motivation commitment and loyalty.

12. Stability of personnel tenure

Employees perform well when their job is secured; they are protected from arbitrary dismissals. It is necessary to retain employees with organization because high turnover rate may result high cost to organization and leads to inefficiency.

13.  Initiative

Organizations require managers who possess ability to conceive and implement new ideas. They should be having ability to  self start and take on the risk independently.

14. Esperit de corps

The maintainance of high moral and unity among employees is an essential thing for success of organization.