Characteristics and Scope of Management
Table of Contents:-
- Scope of Management
- (1) Functional Areas of Management
- (2) Non-Functional Areas of Management
- 1. Financial Accounting
- 2. Cost Accounting
- 3. Financial Management
- 4. Budgeting and Forecasting
- 5. Inventory Management
- 6. Reporting to Management
- 7. Selection of Equities
- 8. Controlled Methodology
- 9. Internal Auditing
- 10. Tax Writing, and Tax Planning
- 11. Office Services
- 1. Economic Resources
- 2. System of Authority
- 3. Class or Elite
- Characteristics of Management
Scope of Management
Management is a comprehensive activity that plays an important role in all the areas where human beings work together. The structuring of an organization is also called management.
The scope of management is not only limited to the implementation or formulation of policies, but the use of physical and human resources also comes under management. Management scope is very wide as it includes policy-making, planning, organising, policy implementation, use of physical and human resources etc.
According to Taylor – “The basic principles of scientific management apply to all human activities, from the simplest individual tasks to the great corporations.”
According to Henry Fayol – “Management is a universal science which is equally applicable to all places of industry, politics, commerce, war religion, and public welfare.” etc.
Thus, management is a universal term and its scope is very wide, therefore no limit can be fixed for managerial activities because to bind them to one limit will have to narrow their scope.
Related article: Importance of management
(1) Functional Areas of Management
A committee of the Ministry of Education of England (Committee on Education for Management) in its report has divided business management into 9 categories which are known as functional areas of management.
These are as follows:
(i) Production Management:
Under this branch of management, the quantity of production, management of material of production, designing, production-planning, work-analysis, quality control, what is to be produced and when to get it done, etc.
(ii) Financial Management:
Under this, the work of making financial estimates, financial planning, finding out various sources of finance and collecting finance and making the best use of finance possible, financial control, etc.
(iii) Personal Management:
This branch of management includes recruitment, selection, training, job evaluation, merit-marking, labour welfare, promotion, reduction, retirement, transfer, social security, prevention of accidents, improvement in working conditions, settlement of disputes, industrial Improvement of relations, remuneration, etc. includes works in its field.
(iv) Development Management:
Under this, industrial and technical research and research in materials and plants, material development, consumer demand, etc.
(v) Distribution Management:
It is also called marketing management. Under this, sales advertisement of goods, sales promotion, market research, establishment and operation of sales branches, selection of distribution-chains, sales power management, pricing of the commodity, internal market and export arrangements, etc.
(vi) Transport Management:
Apart from this, packing of goods, setting up of Ware Housing and choosing different modes of transport like rail, road, air, water, etc. This branch of management is concerned with transporting goods and people from one place to another at a low cost and in less time.
(vii) Purchase Management:
Under this, asking for tender from the suppliers of goods, ordering goods, purchasing goods, maintenance of goods and material control, etc.
(viii) Installation or Maintenance Management:
Under this, the maintenance and proper care of buildings, plants, machines, and other equipment come.
(ix) Office Management:
Under this, correspondence, receiving and dispatching information, maintaining the contact chain within the organization, taking care of forms and documents, keeping records, etc.
(2) Non-Functional Areas of Management
Modern managers also include the following non-functional areas of management within the scope of management.
These are the following:
(i) Environment Management
(ii) Defense Management
(iii) Educational and Training Management
(iv) Technology Management
(v) Management of Public Utilities
(vi) Management of Change
(vii) Management of Conflict
(viii) Tourism Management
(ix) Management of Innovation
According to Peter F. Drucker the field of management includes three managerial functions which are as follows:
(i) Managing the business
(ii) Managing the managers,
(iii) Managing the employees,
The following activities are also included in the field of management:
(v) Co-ordination and
Related article: Levels of management
At present, the meaning of the word management is very deep and comprehensive. The scope of management is not limited to policy-making or policy implementation, but the use of physical and human resources also comes under management. Apart from this, structuring the organization is also called management.
In short, it can be said that policy-making, planning, organization, implementation of policies and use of physical and human resources, etc. all come under the purview of management. Due to the universality inherent element in management, its scope of work cannot be bound by any limits.
In modern times, due to the wide scope of management, it has been divided into various branches based on functions, such as production management, maintenance management, and office management. Office Management, Distribution Management, Purchasing Management, Financial Management, Personnel Management and Development Management, etc.
In this way, the scope of management has become so wide that today no area of human life is left untouched by management. This is the reason why Prof. Newman has described management as a social process.
1. Financial Accounting
Deals with historical data. Writing about an organization and useful for planning and future action. Planning is always done for the future but is based on past and present data.
2. Cost Accounting
The cost of manufacturing the products of the producers by writing the cost is arrived at by using various techniques to determine the cost of the service rendered. Standard Costing Standard Costing, Marginal Costing, and Differential Cost systems are helpful for management for business purposes.
3. Financial Management
The method of the firm is with the planning and control of resources. Fundraising and effective utilization of these funds are considered with the main goal of showing how to use them to maximize profits.
4. Budgeting and Forecasting
The purpose of budgeting is to state the planning policies and goals of the organizations for a certain period in the future. Goals are set for different departments and responsibility is assigned to achieve these goals. The actual achievements are compared with the budgeting.
5. Inventory Management
Inventory Control is from raw material, WIP, and manufacturing. Inventory control is important as it involves a huge amount of funds. It involves determining the minimum level, and maximum session. Helps in controlling the cost of the product
6. Reporting to Management
Managerial accounting is to keep informed about the various activities of a task manager organization through reports. Profit loss statements, cash flow reports, absentee statements, etc. are mentioned in the reports. Reports help review the functioning of the business.
7. Selection of Equities
Financial statements are selected for use by managerial accounting management. These statements describe the financials and position of the organization and can be compared with the statements of other organizations.
8. Controlled Methodology
Control requires systematic policies to use the various components of production in a more and more economical manner.
9. Internal Auditing
To assess the performance of each department, it is necessary to have an internal auditing system.
10. Tax Writing, and Tax Planning
Planning is also an important part of tax writing under the present complex tax system. How to save text by adopting it methodically
11. Office Services
How to maintain records in the office, but whatever data is there in the correct file, and report about the utility of the equipment used in the office and to run smoothly inside the office. Records are maintained properly. Records are kept.
Scope of Management
Economic Resources, System and Class or Elite
The concept of management has broadened with the introduction of new perspectives from different fields of study.
The study of management has evolved into more than just the use of means to achieve given ends. Nowadays, it includes moral and ethical values which are related to the selection of the right ends, which the managers should strive for.
Harbison and Myers give three-fold concepts to emphasize a broader scope for management.
They oversee management:
- An economic resource
- A system of authority, and
- A class or aristocracy
1. Economic Resources
Viewed by economists, management is one of the factors of production along with land, labour, and capital. With the increase in the industrialization of a nation, the need for management becomes more and more with more and more industrialization a nation.
An enterprise’s managerial resources determine its productivity and profitability. Management should be used more in industries experiencing innovations. Executive development is essential for enterprises in which growth is rapid.
2. System of Authority
The experts in administration and organization think that management is a system of authority. Historically, management developed:
(a) An authoritarian philosophy with a small number of higher officials prescribing all the functions of the employees.
(b) Later, the humanistic view of some managers developed the parental approach.
(c) Still later, there is a concern for definite and consistent policies and procedures to deal with the constitutional management rank and file.
(d) As more employees got higher education, management tended towards a democratic and participatory approach.
Thus modern management can be considered a synthesis of these four approaches to authority.
3. Class or Elite
A sociologist views management as a class and status system. The increasing complexity of relationships in modern society demands that managers become the elite of the mind and academia.
Some view this development with alarm while others state that the manager’s power increases; Their number increases to such an extent that there is no need to curtail this tendency toward managerial autocracy. The board’s approach to management requires that students consider this larger perspective of management’s place in society.
An industrial manager might argue that technology is of utmost importance. A psychologist will emphasize human needs and adjustment to organizational pressures. The theologian will focus on the spiritual implications of managerial actions.
Many chief executives and academics believe that the most essential outlook of top managers should be based on a “liberally educated outlook on life”. The overall concept of management requires an understanding of the meaning of liberal education and its relation to managerial functions.
A liberal approach is not simply the sum of a finite number of narrow perspectives. Its stress is on the freedom to choose from a wide range of possibilities by exploring new possibilities and recalling already developed but forgotten possibilities.
The liberally oriented manager extends his freedom to strive towards his ultimate aim in life. Management is concerned with both ends as well as means, it must maintain a broad perspective, unpunished by particular restrictions.
Characteristics of Management
Based on definitions the following characteristics of management can be stated:
1. Management is a Process
Management is a continuous process. This process continues till the time the set goals are achieved, this process is operated by the manager.
2. Management is a Profession
It is essential to have specialized knowledge for management. Acquisition of specialized knowledge is possible only after tireless hard work. All the characteristics of a business are found in management. Management is developing as a business in all developed countries, and ‘Managerial Education Institutes and Courses’ are being run to develop managers as professionals.
3. Management is a Human Activity
Management is a human activity because all the activities like planning, organization, motivation, direction, control, and coordination in any enterprise are human activities. Without these activities, the operation of management is not possible.
4. Management is a Social Process
Management is a human process and man is a social animal. Human actions are directed, controlled, and coordinated by light.
5. Management is a Social Responsibility
Management through innumerable employees creates essential goods and services for the consumption of society. The manager should get such goods produced which are useful for society and can be obtained by society at reasonable prices.
6. Management is a Universal Activity
The process of management is not found in any one country or region but in every country. For every organization whether it is economic or non-economic, its main basis is management. In other words, the operation of any organization is not possible without management.
7. Management is an art as well as a Science
Along with art, the characteristics of science are also found in management. Managerial art is a personal art, which is achieved based on intuitive feeling and intuition, apart from this scientific methods are also adopted in management. Decisions in scientific management are not based only on intuition but are the result of patient scientific research, but they cannot be placed in the category of natural sciences.
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