PERCEPTION - CONCEPT OF PERCEPTION, IMPORTANCE OF PERCEPTION

 

                                                  PERCEPTION

Perception is the act of seeing what is there to be seen.

ROBBINS-  “A process by which individuals organize and interpret their sensory impressions in order to give meaning to their environment.”

CONCEPT OF PERCEPTION-

Perception is the process through which an individual organize & interprets his sensory impression to give meaning to his environment.

Basic feature-

·         Perception is an intellectual process.

·         Perception is the basic cognitive or psychological process.

·         It is a subjective process as different people may perceive the some environmental event differently.

There are two type of perception based on type of stimuli processed-

A.      INTERNAL PERCEPTION- tells us what is going on in our bodies like- hungry, tired etc.

B.      EXTERNAL PERCEPTION- tells us about the environment beyond our bodies- by using our sense of sight, hearing, touching etc we perceived our environment.

                            

IMPORTANCE OF PERCEPTION

In an organization perception is important in 3 major areas-

1.      1. INTERPERSONAL WORKING RELATIONSHIP- 

Managers in the organization need to know whether or not members share similar or atleast compatible perception. If they do not, the problem of the organization are greater & will require efforts to make perception more compatible. Because misperceptions usually lead to strained relations & may even result in open conflict.

2.      2. SELECTION OF EMPLOYEES-

Organization select new employees on the basis of select test, interviews & reviews of the applicants background. This is to avoid perceptual problems that may be-

a. The emotional  state of managers may vary from day to day causing unfair perceptions of the same applicants.

b. There may be strong tendencies to words logical error & stereotyping during initial interviews.

        3. PERFORMANCE APPRAISAL- Performance appraisal of a subordinate is highly affected by the accuracy of a manager’s perceptions. The major area of concern are-

a. Managers may have tendencies to positively evaluate some employees because they are better liked, or are on favorable tasks, or particularly noticeable. 

b. Because of halo effect performance will be affected.

 

Managerial Effectiveness

 

Managerial Effectiveness

Meaning of of Managerial Effectiveness:

The term ‘managerial effectiveness’ could mean achievement of organisational goals, increase in productivity, profit, workers’ satisfaction, growth, diversification etc. Managerial effectiveness aims at optimum allocation and utilization of scarce organisational resources in order to achieve the goals at minimum cost. It aims at deriving maximum output out of minimum input.

Successful managers keep the organisation going in the present and future. An organisation must be capable of performance, growth and change in the future. An organisation that does not account for future has destroyed capital, that is, capital not enough to produce wealth for its survival. Managerial effectiveness aims at survival, growth and adaptability of organisations to the external environment.

Managerial effectiveness consists of the following elements-

1. Manager: Manager is the key pin of a successful organisation. Well-defined objectives and strategies are required to effectively transform inputs into outputs. Managerial effectiveness is governed by managerial skills, competence, intelligence, knowledge, sincerity and creativity. It is judged by not what the managers do but by how well they do. Effective managers enable the business to grow in the dynamic environment.

2. Organisation:

Managerial effectiveness is also judged by the organisation itself. Highly innovative and creative managers may not perform well if the organisation structure does not permit them to do so. The structure, value system, design, culture, size and the work environment largely determine the way managers manage the organisation. A highly bureaucratic and formal organisation structure may not have committed and effective managers.

3. Entrepreneurship:

Success cannot be ensured unless managers have the quality of entrepreneurship. Managerial effectiveness ensures that business in future is different from business today. It requires hard work, intelligence, creativity and innovativeness to keep the business successful in future.

4. Environment:

Business operates in the dynamic and turbulent environment with ever changing factors (economic, political, legal, social etc.). Managers adapt the organisations according to demands of the environment. Successful and effective managers not only respond to environment; they also influence the environment and become market leaders in the industry.

Key Determinants of Effective Control Systems

 

Key Determinants of Effective Control Systems

Controls at every level focus on inputs, processes and outputs. It is very important to have effective controls at each of these three stages.

Effective control systems tend to have certain common Determinants. The importance of these characteristics or determinants varies with the situation, but in general effective control systems have following characteristics.

1. Accuracy:

Effective controls generate accurate data and information. Accurate information is essential for effective managerial decisions. Inaccurate controls would divert management efforts and energies on problems that do not exist or have a low priority and would fail to alert managers to serious problems that do require attention.

2. Timeliness:

There are many problems that require immediate attention. If information about such problems does not reach management in a timely manner, then such information may become useless and damage may occur. Accordingly controls must ensure that information reaches the decision makers when they need it so that a meaningful response can follow.

3. Flexibility:

The business and economic environment is highly dynamic in nature. Technological changes occur very fast. A rigid control system would not be suitable for a changing environment. These changes highlight the need for flexibility in planning as well as in control.

Strategic planning must allow for adjustments for unanticipated threats and opportunities. Similarly, managers must make modifications in controlling methods, techniques and systems as they become necessary. An effective control system is one that can be updated quickly as the need arises.

4. Acceptability:

Controls should be such that all people who are affected by it are able to understand them fully and accept them. A control system that is difficult to understand can cause unnecessary mistakes and frustration and may be resented by workers.

Accordingly, employees must agree that such controls are necessary and appropriate and will not have any negative effects on their efforts to achieve their personal as well as organizational goals.

5. Integration:

When the controls are consistent with corporate values and culture, they work in harmony with organizational policies and hence are easier to enforce. These controls become an integrated part of the organizational environment and thus become effective.

6. Economic feasibility:

The cost of a control system must be balanced against its benefits. The system must be economically feasible and reasonable to operate. For example, a high security system to safeguard nuclear secrets may be justified but the same system to safeguard office supplies in a store would not be economically justified. Accordingly the benefits received must outweigh the cost of implementing a control system.

7. Strategic placement:

Effective controls should be placed and emphasized at such critical and strategic control points where failures cannot be tolerated and where time and money costs of failures are greatest.

The objective is to apply controls to the essential aspect of a business where a deviation from the expected standards will do the greatest harm. These control areas include production, sales, finance and customer service.

8. Corrective action:

An effective control system not only checks for and identifies deviation but also is programmed to suggest solutions to correct such a deviation. For example, a computer keeping a record of inventories can be programmed to establish “if-then” guidelines. For example, if inventory of a particular item drops below five percent of maximum inventory at hand, then the computer will signal for replenishment for such items.

9. Emphasis on exception:

A good system of control should work on the exception principle, so that only important deviations are brought to the attention of management, In other words, management does not have to bother with activities that are running smoothly. This will ensure that managerial attention is directed towards error and not towards conformity. This would eliminate unnecessary and uneconomic supervision, marginally beneficial reporting and a waste of managerial time.

 

COORDINATION - NEED OF COORDINATION, Importance of coordination, Technique of Effective co-ordination

 

COORDINATION

According to various experts, coordination means:

“Coordination is the essence of management for the achievement of harmony of individual efforts towards the accomplishment of group goals.                                                                  -koontz & O’Donnell

NEED OF COORDINATION-

Main points of the need of coordination are as follows:

                                i.            Unity of command may only be exercised, if effective coordination is there.

                              ii.            Coordination establishes unity among the various factors of management having difference.

                            iii.            Coordination increases total accomplishment of the employed resources.

                             iv.            Through coordination energy, money and time wasted upon conflicts can be minimized.

                               v.            Coordination expands the creative and the constructive power of human.

                             vi.            It establishes a balance in the organization.

Importance of coordination-

 “men must be induced to cooperate and to work together.”

Koontz and O’Donnell says, “Coordination is the essence of management not simply a function.”

The importance of coordination is as follows:

§  Unity of command: “unity of command is important cannon of management. Without coordinating various activities in a whole, this principle cannot be attained in organization.

§  Unity amidst diversity: In an organization, a variety of persons work to achieve a common goal. Though, they are directed and diverted towards common goals. Though, they are directed towards a common goal but they have their own type of brain, working and ideology.

§  Total accomplishment: if it is assumed that persons of an organization are individually potent, devoted and skilled, their total accomplishment will be greater than their individual efforts, therefore coordination is important to establish. Mary Parker Follet had favored this theory. She says it “positive”.

§  High Employee Morale: coordination gives job satisfaction to the employees because of mutual help and optimum relationship. Consequently, there morale uplifts and they work with more devotion, more zeal and more industry.

§  Creative and constructive power: Coordination is an effective, creative and constructive power. New and beneficial personal and collective efforts. Without coordinating, factors of production remain unproductive.

§  To establish balance: it is evident that all persons working in an organization cannot be equal at every point. Some persons may have intellect where as some persons may have strength. Coordination balances these variances.

Technique of Effective co-ordination-

The basic objective of all management function is to get things done by coordinated efforts.

1)      Coordination by chain of command-

Vertical coordination is required to synchronize the work the work allocated to several mgt. level in the organization . A Manager can achieve vertical coordination by using his authority & issue order & instructions.

 

2)      Coordination by leadership-

If coordination cannot be achieved by authority, managers can use leadership to bring coordination among  their subordinates. Leadership is the process of influencing and supporting  others  to work willingly & enthusiastically to achieve desired results.

3)      Coordination by committees-

The role of a committee is significant in achieving  horizontal coordination , i.e , coordination of efforts of functional or divisional units. Committee ensures that problems which arise out of relationship among various units can be solved by group decision. This creates better understanding of each other which helps in coordination .

 

4)      Staff meetings-

Periodic staff meeting can be highly effective in promoting coordination.

 

5)      Special coordinators- in large orgnisation , special  coordinators are  appointed. The normally work in staff capacity to facilitate the working of line managers. A coordination cell may be created whose responsibility is to collect the relevant information and send this to various heads of department or sections so that inter-department  work and relationship are coordinated.

 

6)      Self coordination-  it  involves functioning of each dept. in such a way that each dept. coordinates with other departments. Each dept. , section , or individual affect others and is also affected by others.  Therefore, if these dept. , section or individuals adopt a method of working which facilitates others, self-coordination is achieved. This can be done by better horizontal communication.

Control Techniques - 10 Types of Techniques of Controlling

 

Control Techniques - 10 Types of Techniques of Controlling

1. Direct Supervision and Observation

'Direct Supervision and Observation' is the oldest technique of controlling. The supervisor himself observes the employees and their work. This brings him in direct contact with the workers. So, many problems are solved during supervision. The supervisor gets first hand information, and he has better understanding with the workers. This technique is most suitable for a small-sized business.

2. Financial Statements

All business organisations prepare Profit and Loss Account. It gives a summary of the income and expenses for a specified period. They also prepare Balance Sheet, which shows the financial position of the organisation at the end of the specified period. Financial statements are used to control the organisation. The figures of the current year can be compared with the previous year's figures. They can also be compared with the figures of other similar organisations.

3. Ratio analysis can be used to find out and analyse the financial statements. Ratio analysis helps to understand the profitability, liquidity and solvency position of the business.

4. Budgetary Control

A budget is a planning and controlling device. Budgetary control is a technique of managerial control through budgets. It is the essence of financial control. Budgetary control is done for all aspects of a business such as income, expenditure, production, capital and revenue. Budgetary control is done by the budget committee.

5. Break Even Analysis

Break Even Analysis or Break Even Point is the point of no profit, no loss. For e.g. When an organisation sells 50K cars it will break even. It means that, any sale below this point will cause losses and any sale above this point will earn profits. The Break-even analysis acts as a control device. It helps to find out the company's performance. So the company can take collective action to improve its performance in the future. Break-even analysis is a simple control tool.

6. Return on Investment (ROI)

Investment consists of fixed assets and working capital used in business. Profit on the investment is a reward for risk taking. If the ROI is high then the financial performance of a business is good and vice-versa.

ROI is a tool to improve financial performance. It helps the business to compare its present performance with that of previous years' performance.  It also shows the areas where corrective actions are needed.

7. Management by Objectives (MBO)

Management by objective (MBO) is regarded as one of the most important contribution of Drucker to the discipline of Management.

MBO includes:

                               I.            Method of Planning

                            II.            Setting standards

                         III.            Performance appraisal

                         IV.            Motivation

MBO facilitates planning and control. It must fulfill following requirements :-

1. Objectives for individuals are jointly fixed by the superior and the subordinate.
2. Periodic evaluation and regular feedback to evaluate individual performance.
3. Achievement of objectives brings rewards to individuals.

8. Management Audit

Management Audit is an evaluation of the management as a whole. It critically examines the full management process, i.e. planning, organizing, directing, and controlling. It finds out the efficiency of the management. To check the efficiency of the management, the company's plans, objectives, policies, procedures, personnel relations and systems of control are examined very carefully. Management auditing is conducted by a team of experts. They collect data from past records, members of management, clients and employees. The data is analysed and conclusions are drawn about managerial performance and efficiency.

9. Management Information System (MIS)

In order to control the organisation properly the management needs accurate information. They need information about the internal working of the organisation and also about the external environment. Information is collected continuously to identify problems and find out solutions. MIS collects data, processes it and provides it to the managers. MIS may be manual or computerized. With MIS, managers can delegate authority to subordinates without losing control.

10. Self-Control

Self-Control means self-directed control. A person is given freedom to set his own targets, evaluate his own performance and take corrective measures as and when required. Self-control is especially required for top level managers because they do not like external control.

The subordinates must be encouraged to use self-control because it is not good for the superior to control each and everything. However, self-control does not mean no control by the superiors. The superiors must control the important activities of the subordinates.

 

 

CONTROLLING PROCESS - Controlling is a forward looking process and backward looking function

 

CONTROLLING PROCESS

Controlling is a systematic process involving the following steps:

Step 1- setting performance standard – standards provide the yardsticks against which actual performance is measured.

Standards can be set in both quantitative as well as qualitative terms.

·         Standards should be flexible so that they may be modified as per changes taking place in the business environment.

·         Sometimes standards may also be set in qualitative terms. Improving goodwill and motivation level of employees are examples of qualitative standards.

Step 2- MEASUREMENT OF ACTUAL PERFORMANCE – once the standards have been established, the second step is to measure the actual performance.

·         The performance can also be measured through calculation of certain ratios the like gross profit ratio, return on investment, etc.

·          To make the comparison easier, performance should be measured in the unit in which standards are set.

Step 3- COMPARISON OF ACTUAL PERFORMANCE WITH STANDARDS- The third step in controlling process is to compare the actual performance with the standards.

·         Such comparison will reveal the deviation between the planned and actual performance.

·         Comparison is easy when standards are set in quantitative terms. For instance, it is easy to compare performance of a worker in terms of units produced in a week.

·         However, the comparison becomes difficult when they require subjective evolution.

Step 4- ANALYSING DEVIATION- some deviation in performance is expected in all activities so, the next step in controlling process is to analyze the deviations.

·         For this, an acceptable range of deviation must be fixed as significant deviations need more attention as compared to minor deviations.

·         Moreover, deviation in key areas of business needs to be attended more urgently as compared to deviations in certain insignificant areas.

CONTROLLING- Concept, FEATURES, NEEDS OF CONTROL SYSTEM and IMPORTANCE OR SIGNIFICANCE OF CONTROL

CONTROLLING

Concept

“Controlling is the process of evaluating actual performance and, if necessary, taking corrective actions so that the performance is in accordance with planned performance’’

It means to know that all work is performed according to the Predetermine planning, objectives and principles or not, what are the reasons, who is responsible and what are the methods of improving it.

FEATURES

·         Controlling is both backward and forward looking function.

·         It is relevant at all management level.

·         It is continuous process.

·         Controlling system is action-oriented.

NEEDS OF CONTROL SYSTEM:

To run an enterprise smoothly and perfectly in accordance with the set goals, a healthy and effective control system is a must. But, it is a well known fact healthy and effective control depends solely upon:

         i. The effective plans.

        ii. The good and continuous system to develop progress report in the enterprises.

      iii. The system for corrective steps if there is some difference between the set plans and the progress report.

       iv.The system to analyses the whole work at a glance.

 

IMPORTANCE OR SIGNIFICANCE OF CONTROL

Control is the most important aspect of a manger’s function .the significance of control in an organization can be judged from the following:

Ø  INSURANCE VALUE OF CONTROL: control eliminates the risk of non-conformity of actual performance with the main goal of the organization.

Ø  BASIS FOR FUTURE ACTION: Control provides the information and facts to the management for planning and organizing when the work in complete and the result is evaluated.

Ø  SIMPLIFIES SUPERVISION: The systematic control helps in finding out the deviation existing in the organization which simplifies the subordinates.

Ø  FACILITY OF COORDINATION: Control plays a very important role in coordinating the business activities and worker it binds all the workers and other activities and motivates them to move towards the common objectives through coordination.

Ø  EXTENSION OF DECENTRALIZATION: Control system helps the top management to extend the decentralization without the loss of control.

Ø  HELPS IN IMPROVING EFFICIENCY: the control system helps in improving organizational efficiency. Various control devices act as motivators to manager.

Ø  PSYCHOLOGICAL PRESSURE ON EMPLOYEES: Control put psychological pressure on employees in the organization to work and to act collectively as and when required.

Ø  REDUCES UNCERTAINTIES: control minimizes variability and predictability in the use of means and attainment of end. 

Techniques of motivation, Significance of Motivation

 

Techniques of motivation

1. Financial incentives:  First techniques of motivation are financial incentives as money is indicator of success. Therefore, it fulfills psychological safety and status need as people satisfy their needs by money. Wages, salary motivates employees to perform better.

2. Job enlargement: Under this technique, task assigned to do job are increased by adding simile task.   So the scope of job enlargement is high for the motivation of subordinates. It is also known as horizontally leading of job.

3. Job enrichment: Under this technique jobs are made challenging and meaningful by increasing responsibility and growth opportunities. In such technique of motivation, planning and control responsibility are added to the job usually with less supervision and more self evaluation. It is also called vertical leading.

4. Job rotation:  it refers to shifting an employee from one job to another. Such job rotation doesn’t mean hanging of their job but only the employees are rotated. By this it helps to develop the competency in several jobs which helps in development of employees.

5. Participation : Participation refers to involvement of employee in planning and decision-making .it helps the employees feel that they are an asset of the organization which helps in developing ideas to solve the problems.

6. Delegation of authority:Delegation of authority is concerned with the granting of authority to the subordinates which helps in developing a feeling of dedication to work in an organization because it provides the employees high morale to perform any task.

7. Quality of work life:It is the relationship between employees’ and the total working environment of organization. It integrates employee needs and well-being with improves productivity, higher job satisfaction and great employee involvement. It ensures higher level of satisfaction.

8. Management by Objectives: It is used as a motivation and technique for self-control of performance. By this technique supervisor and subordinates set individual and organizational goals. Each individual’s responsibilities are clearly defined which would help identify the skill sets one has to make the best use of the same to meet organizational mission and vision. This also helps the organization function effectively.

9. Behavior modification:The last technique of motivation is behavior modification. It develops positive motivation to the workers to do the work in desired behavior in order to modify behavior.

 

 

Significance of Motivation

Motivation is one of the important parts of managerial functions. A manager becomes unsuccessful if he fails to motivate his subordinates. It refers to a willingness to do something in order to achieve organizational objectives and goals. It is the reason for people’s actions, desires, and needs. The reasons behind its significance are as follows:

1.     Effective Utilization of Human Resources

Manpower is the main active factor of production and is responsible for the best utilization of organizational resources. Motivation helps to utilize the human resources effectively and efficiently towards the attainment of organizational goals and objectives. Motivation is the main instrument which creates the willingness among workers to do their work in the best possible way. Because motivated people show a greater degree of job performance ability and skills.

2.                 Effective Utilization of Other Resources

Along with human resources, motivation promotes the effective mobilization of other non-human resources. The development of self-responsibility among the workers contributes to the best utilization of available resources like materials, money, machines, and others. Motivated people can find better ways to do the jobs thereby reducing the wastage and damages of resources. Hence, motivated employees can utilize organizational resources effectively.

3.                 Willingness to Work

Motivation is a willingness to do a particular task in order to achieve organization’s goals and objectives. This inspires, induces, and stimulates individual for a higher level of performance. Through intrinsic and extrinsic factors people will be motivated towards better performance. Hence, such motivational factor increases willingness for work in them.

4.                 Acceptance of Change

Motivation makes employees ready for accepting change in organizational environment. It means, motivation can be found in the present and future technology required for production. Hence, it prepares people for adoring such change. On the other hand, demotivated employees try to resist change.

5.                 Public Image

Motivated employee performs the task with utmost care and with a positive comment about their organization; thereby resulting from less wastage and damages; as a result of which they can build a strong public image in the society. If employees are motivated, they work for the organization, which enhances the quality output and productivity. This ultimately enhances a good public image.

6.                 Co-operation between Employees

Motivated employees are working friendly; so they coordinate with each other while performing the tasks. They share their ideas, feelings, attitudes, and experiences with each other. Hence, this brings the feeling of co-operation.

7.                 Better Supervision

Motivated employees are self-controlled and self-managed. They perform the tasks without any reluctance; hence, the work performed by such motivated and committed employee requires no supervision at all.

8.                 Organizational Effectiveness

When the employees are motivated, they perform organizational activities with an utmost care. They introduce creative and innovative ideas in the workplace and accept organizational challenges easily. Hence, the organizational effectiveness can be maintained.