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Functions of Management - Clearly Explained

Updated on November 24, 2012

There is enough discrepancy among management writers on the categorization of Functions of Management. Some writers classify these functions into four types, some into five and some into six or seven. The terminology is also not always similar, different authors contribute dissimilar names for the same functions of management. Newman and Summer recognize only four functions of Management, namely, organizing, planning, leading and controlling.

Luther Gulick states seven tasks under the catchword "POSDCORB" which stands for planning, organizing, staffing, directing, coordinating, reporting and budgeting. Henry Fayol recognizes five functions of management, they are planning, organizing, commanding, coordinating and controlling.

Functions of Management
Functions of Management | Source

Warren Haynes and Joseph Massie classify management functions into decision-making, organizing, staffing, planning, controlling, communicating and directing.

Koontz and O'Donnell break up these functions into planning, organizing, staffing, directing and controlling. For our purpose, we shall assign the following four as the functions of a manager: planning, organizing, directing and controlling. We will also briefly look at innovation and representation as two supplementary managerial functions considered significant by Ernest Dale.

Planning Function of Management

Planning is the function that establishes in advance what should be done. It is looking in advance and getting ready for the future. It is a technique of deciding the business objectives and charting out the methods of achieving those objectives. In other words, it is the determination of what is to be done, how and where it is to be done, who is to do it and how consequences are to be assessed. This is done not only for the organization as a whole but for every division, subdivision or sub-section of the organization. Thus planning is a function which is carried out by managers at all levels in an organization - top, middle and supervisory. Plans made by top management for the organization as a whole may cover time as long as five or ten years. Plans carried out by middle or first line managers, cover much shorter periods. Such plans may be for the next day's work, for example, or for a two-hour gathering to take place in a week.

Organizing Function

To organize a business is to make available it with everything useful to its functioning, say personnel, raw materials, tools and capital. All this may be separated into two main segments, the human organization and the material organization. Once managers have established objectives and developed plans to accomplish them, they must design and develop a human organization that will be capable to perform those plans effectively. According to Allen, this human organization refers to "the structure which results from identifying and grouping work, defining and delegating responsibility and authority, and establishing the relationships".

Staffing may also be considered as one of the significant Functions of Management involved in constructing the human organization. In staffing, the manager challenges to find the right person for each job. Staffing fixes a manager's responsibility to recruit and to make sure that there is adequate manpower available to fill a variety of positions needed in the organization. Staffing involves the selection and training of future managers and an appropriate system of reward. Staffing apparently cannot be done once and for all, since people are frequently leaving, getting fired, retiring. Often too, the transformations in the organization generate new positions, and these must be filled.

Books to Improve Management Skills

Directing Functions of Management

After plans have been ready and the organization has been established and staffed, the next step is to progress towards its distinct objectives. This role of manager can be called by various names like "actuating", "leading", "directing", "motivating" and so on. But whatsoever the name used to recognize it, in carrying out this function the manager clarify to his people what they have to do and facilitate them do it to do the best of their capability. Directing thus engages three sub-functions; they are communication, leadership and motivation. Communication is the process of passing information and understanding from one person to another person. Leadership is the process in which a manager guides and influences the effort of his subordinates. Motivation means arousing desire or wish in the minds of workers to give their greatest to the enterprise. It is the act of inspiring or rousing workers. If the workers of an organization are appropriately motivated they will pull their weight efficiently, give their loyalty to the enterprise, and perform their duty effectively. Motivation is classified under two broad categories; financial and non-financial. Financial motivation takes the form of bonus, profit-sharing, distribution of company share etc. whereas non-financial motivation takes the form of opportunity of advancement, job security, recognition, praise, etc.

Controlling Function of Management

The manager must make certain that the whole thing occurs in compliance with the plans adopted, the directions issued and the principles established. This is the controlling function of management, and involves three essentials.

  1. Establishing performance standards
  2. Evaluating current performance and comparing it against the established performance standards.
  3. Taking corrective action to any performance that doesn’t meet established standards.

In the lack of sound control, there is no assurance that the objectives which have been put will be realized. The management may go on committing faults without knowing them. Control forces actions to conform to plans.

Innovation function

Nowadays, it is not essential for an organization to grow bigger. But it is essential that it continuously grows better. This creates innovation important functions of management. Innovation refers to generating new ideas which may either result in the development of new products or finding new customers for the old products. One may, though, consider innovation not a separate management functions but only a part of planning.

Representation function

A manager is also required these days to spend a part of his time in representing his organization in front of various outside groups which have some stake in the organization. These stake-holders can be government officials, financial institutions, labor unions, vendors, customers, etc. They exert influence over the organization. A manager must win their support by efficiently managing the social impact of his organization.

            It should be implicit that every function has two dimensions: substantive and procedural. Substantive dimension is what is being done and procedural dimension is how it is done. The above description and Functions of Management not only help us to recognize a manager but they tell us about how he manages. A highly useful way to know this is to think of management as an operational procedure and its function as sub-processes in a circular continues movement.


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