Free Principles of Management revision

i. Strategy: What the company wants to achieve and how it plans to do it.
ii. Structure: How the company is organized, including reporting structure and employee tasks.
iii. Systems: Formal processes and tools the company uses to get things done.
iv. Shared values: The core beliefs and principles that guide behavior and decision-making in a company.
v. Skills: Employees’ abilities and expertise.
vi. Style: The leadership and management approach within a company, including the leadership style of top executives and the overall company culture.
vii. Staff: The company workforce, including the number of employees, their roles, and their distribution across different functions.

McClelland affirms that people have three motivating drivers, which do not depend on their gender or age. One of these drives will be dominant in each person’s behavior and the dominant driver depends on an individual’s life experiences.
The three motivators are:
i. Achievement: A need to accomplish and demonstrate own competence. Individuals with a high need for achievement prefer tasks that provide personal responsibility and results based on their efforts.  They also prefer quick acknowledgment of their progress.
ii. Affiliation: A need for love, belonging, and social acceptance. Individuals with a high need for affiliation are motivated by being liked and accepted by others.  They tend to participate in social gatherings and may be uncomfortable with conflict.
iii. Power: A need for controlling own work or the work of others. Individuals with a high need for power desire situations in which they exercise power and influence over others.  They aspire for positions with status and authority and tend to be more concerned about their level of influence than about effective work performance.

The expectancy theory of motivation suggests that employees are motivated when they believe—or expect—that :(i) Their effort will lead to high performance, (ii). Their high performance will be rewarded, and (iii). The rewards they will receive are valuable to them.

According to the path-goal theory of leadership, the leader’s main job is to make sure that all three of these conditions exist. Thus, to create satisfied and high-performing employees, leaders ensure employees’ efforts lead to performance, and their performance is rewarded. The leader removes roadblocks along the way and creates an environment that subordinates find motivational.

The theory identifies four leadership styles: (i). Directive leaders,(ii). Supportive leaders,(iii).Participative leaders, and (iv).Achievement-oriented leaders.
Each of these styles can be effective, depending on the characteristics of employees) and characteristics of the work environment.

Authoritative leadership: Authoritative leaders make the decision alone without necessarily involving employees in the decision-making process.
Advantages: Authoritative leaders bring clarity, provide direction and vision, and breed goodwill.
Disadvantages: Authoritative leaders can appear overbearing, and must own their mistakes

Democratic leadership: Democratic leaders allow employees to participate in the making of decisions.
Advantages: Creates inspiration and cooperative spirit, uses diversity and expertise, boosts morale and motivation, and has the option to choose from many opinions and solutions.
Disadvantages: Promotes indecisiveness, can cause conflict in the group, requires a lot of time, and can lead to frustration if a contributor’s ideas are not accepted.

Laissez-faire leadership: This type of leadership leaves employees alone to make the decision, with the leader providing minimum guidance and involvement in the decision.
Advantages: Enables employees to practice leadership & independence while using their expertise to make decisions quickly, and boosts employees’ morale.
Disadvantages: Lowers role awareness, some employees may avoid work by taking advantage of limited supervision, and may increase conflicts if some employees act on self-interest.

Introduced by psychologist Douglas McGregor, the X and Y theory states that managers are guided by their perception of their team members’ motivations, and therefore use two different theories.
Managers who conclude employees are apathetic or not happy in their work use Theory X, which is a more authoritarian approach, whereas managers who see employees as responsible, self-motivated, and committed use Theory Y, which leads to a more collaborative work environment.

Setting objectives is the most crucial step in the planning process.

i. Leadership (good guidance, ownership and responsibility, strategic thinking, inspiring and motivating others.
ii. Self-awareness (personality, values, needs, and cognitive style).
iii. Stress management (time management, personal goals, and activity balance)
iv. Creative problem solving (divergent thinking, conceptual blocks, and redefining problems).
v. Good communication (listening, communication job responsibilities and expectations, understanding body language, empathy and counseling).
vi. Respect for and motivating others (needs/expectations, rewards, and timing)
vii. Effective delegation and joint decision making (assigning tasks, evaluating performance autonomously versus joint decision making).

i. Simple: The control system should be easy to understand and operate to avoid unnecessary mistakes, confusion, and frustration among employees. When the control system is understood properly, employees can interpret the same in the right way and ensure its implementation.
ii. Sound and economical: The system of control should be economical and easy to maintain. To minimize costs, management should try to impose the least amount of control that is necessary to produce the desired results.
iii. Suitable: The control system must be suitable to the needs of an organization by conforming to the nature and needs of the job and the area to be controlled. For example, the control system used in the finance department will be different from that used in the operations department.
iv. Selective: The control system must focus attention on key, strategic, and important factors that are critical to performance. This will ensure managers save their time and meet problems head-on effectively.
v. Reasonable: Controls must be reasonable and attainable. Unattainable control demotivates employees whereas very low controls do not pose any challenge to employees nor stretch their talents.
vi. Flexible: The system must be flexible enough to adjust to adverse changes or to take advantage of new opportunities.
vii. Forward-looking: An effective control system should be forward-looking, providing timely information on deviations to ensure managers take remedial steps immediately before things go out of gear.
viii. Objective: A control system should not be subjective and arbitrary, but should be objective and impersonal to be effective. Standards set in clear terms are easy to understand and evaluate. They should also be accurate and unbiased.
ix. Responsibility for failures: An effective control system must indicate responsibility for failures, and should also point out what corrective actions are needed to keep actual performance in line with planned performance
x. Acceptable: Controls will not work unless people want them to. They should be acceptable to whom they apply, controls will be acceptable when they are (i) quantified, (ii) objective (iii) attainable, and (iv) understood by one and all

i. Traditional Authority: This type of power is historical and accepted because it has been traditionally the case. Here, the ruler has no real force to carry out their will and their position depends on a group’s respect. This type of power can also be intertwined with race, gender and class
Examples include patriarchy and monarchy (royal families with no political power but social influence).

ii. Charismatic Authority: This type of power draws followers to the leader’s personal qualities which inspire the followers to make unusual sacrifices or persevere amid great persecution and hardships. Emerging mostly in times of crises, they offer innovative or radical solutions or visions of a new world order. This type of leader holds power for a short time (e.g. Malcom X, Winston Churchill, Napoleon, Hitler).

iii. Rational-Legal Authority: This refers to the power that is made legitimate by laws, regulations, and written rules. The power here is vested in a particular rationale, ideology, or system, and not necessarily in the person who implements the specifics of the doctrine. Thus, the power to influence falls on specific structured, bureaucratic offices and individuals holding positions with authority to act in the name of such positions.
Examples in an organization that follows set standards and a country following the constitution.

Strategic Control: Strategic control helps managers to know if the company is headed in the right direction. It involves monitoring a strategy as it is being implemented, evaluating deviations, and making necessary adjustments. Strategic control may also involve the reassessment of a strategy due to an immediate, unforeseen event. For example, if a company’s main product is becoming obsolete, the company must immediately reassess its strategy.

Operational Control: Operational control involves control over intermediate-term operations and processes but not business strategies. It focuses more on internal sources of information and affects smaller units or aspects of the organization, such as production levels or the choice of equipment.

Operational control systems ensure that activities are consistent with established plans. Mid-level management uses operational controls for intermediate-term decisions, typically over one to two years. When performance does not meet standards, managers enforce corrective actions, which may include motivation, training, discipline, or termination.

Tactical Control: Tactical control emphasizes the current operations of an organization. Managers determine what the various parts of the organization must do for the organization to be successful in the near future (one year or less).

This is an example of external risk controls which are put in place to protect an organization from an external force.
Internal risk controls involve putting procedures and processes in place to prevent problems coming from inside the organization. They ensure everything operates smoothly and mistakes are limited.

Holistic management theory
Sometimes called the integral theory or the organizations as learning systems theory, the holistic management theory is based on the idea that businesses are stronger when all parts are integrated and working together. In this theory, management’s responsibility is to provide transparency, provide clear goals and align their workforce toward a common purpose. Under this theory, learning and change are the order of the day, with an emphasis on teamwork, information sharing and empowerment of the individual.

Knowledge worker theory
Developed by Peter Drucker, the knowledge worker management theory became popular in the latter half of the 20th century as organizations began incorporating his ideas of balancing business needs with community. In his theory, the employee is seen as an asset, with skills that must be managed and developed. Management is responsible for training employees or providing learning pathways through outside resources to close skill gaps.

Vroom and Yetton’s normative decision model is a guide leaders can use to decide how participative they should be given decision environment characteristics.

Budgeting is an essential tool for effective planning and control in an organization. The budget helps to ensure that resources are allocated appropriately to achieve the organization's objectives.

Effective Budgeting helps organizations to:
i. Set and Prioritize Objectives: Budgeting enables organizations to set specific objectives and prioritize them according to their importance. This helps organizations to focus on the most critical activities and allocate resources accordingly.
ii. Allocate Resources: Budgeting enables organizations to allocate resources efficiently and effectively. By identifying the resources required to achieve the objectives, organizations can allocate their resources in a way that maximizes their impact.
iii. Manage Cash Flow: Budgeting enables organizations to manage their cash flow by forecasting future revenues and expenses. This helps organizations plan their cash flow requirements and ensure that they have sufficient funds to meet their obligations.
iv. Monitor Performance: Budgeting helps organizations monitor their performance by comparing actual results to budgeted results. This helps organizations to identify areas where they are performing well and areas where they need to improve.
v. Make Informed Decisions: Budgeting provides organizations with financial data that can be used to make informed decisions. By having a clear understanding of the organization's financial position, organizations can make informed decisions about where to invest their resources.
vi. Effective Planning: The budget is an essential tool for effective planning. It helps an organization to identify its goals and objectives and to develop a plan to achieve them. The budgeting process involves setting targets and determining the resources required to achieve those targets. This helps an organization to prioritize its activities and allocate resources accordingly.

1. Organizational or Transformational Change: This refers to large change management projects that are large in scale and scope. These change transformations are often dramatic, such as altering the organizational hierarchy, launching a new product, or undergoing digital transformation.
2. Adaptive or Gradual Change: These change projects are smaller in scope and involve smaller changes to products, processes, strategies, and workflows. Adaptive change projects include hiring a new team member, implementing new software tools, or updating a work-from-home policy.
3. Individual Change Management: These change projects help individuals manage change to grow in their role and/or achieve specific goals. This could include learning a new skill.

Porter’s five forces analysis is a technique for understanding an industry by considering the interactions among the competitors in an industry, potential new entrants to the industry, substitutes for the industry’s offerings, suppliers to the industry, and the industry’s buyers .
• Competitors refers to firms that produce similar goods or services within an industry.
• Potential new entrants to the industry refers to firms that do not currently compete in an industry but might join in the industry.
• Substitutes for the industry’s offerings refers to offerings from other industries that fulfill the same need as an industry’s products or services.
• Suppliers to the industry refers to providers of inputs that the competitors in an industry need to create goods or services.
• The industry’s buyers refer to purchases of the goods or services that competitors in an industry create.

Environmental scanning can be defined as the process of gathering, evaluating, and delivering information for a strategic purpose (e.g. To help management determine the future direction of the organization).

Components include:
i. Internal environmental components: This refers to components that lie within the organization whose changes affect the general performance of the organization(e.g. Human resources, capital resources, and technological resources).
ii. External environmental components: This refers to components that fall outside the business organization. They are divided into microenvironmental components and macroenvironmental components.
*Microenvironmental components include competitors, markets, consumers, suppliers, organizations, etc.
*Macroeconomic components include legal, political, cultural, economic, demographic, and technological factors.

i. Offering growth opportunities: Investing in employee development through training programs, workshops, and career advancement opportunities to only enhance their skills and boost job satisfaction.
ii. Fostering a positive work culture: Creating an inclusive and supportive environment where employees feel valued and respected, and encourage open communication while providing regular feedback.
iii. Engaging employees in decision-making: Involve employees in decision-making, especially on matters that affect their work. This will empower them and make them feel more connected to the company’s goals and vision
iv. Recognizing and rewarding achievements: Acknowledging hard work and accomplishments through awards, bonuses, and public recognition to foster a sense of achievement and motivation.
v. Supporting a healthy work-life balance: Implementing flexible work arrangements, encouraging regular breaks, and supporting mental health initiatives.