February 16, 2019

Leading - Global Management Challenges

Basic article on leadership
Leadership - Koontz and O'Donnell - Review Notes

Leading in organizations is the process of influencing people so that they will contribute to organizational aims. Leading involves communicating what is needed to be done by various persons in the organization, providing leadership which includes understanding the needs of the followers and matching them with the needs of the organization and motivating which is concerned once with the needs of the members of the organization with the rewards and job roles.

Leading is practiced differently in different countries.

Leading Japan

In Japan, managers are seen as social integrators and are also part of work group. Managers show paternalistic leadership approach and show great concern for the welfare of their subordinates. Managers do the same work their subordinates do often to develop the environment of esprit de corps. This was mentioned by Fayol in his principles. Managers avoid face to face confrontation to maintain harmony. In Japan, employees develop close personal relationships as they interact outside the offices also more frequently.  Japanese managers emphasize face to face communication instead of memos.

Leading in the United States

In the US culture the emphasis is on individualism. Leaders are seen as decision makers heading the group. They are expected to be directive, strong, firm, and determined.  Written communication is given emphasis and managers value their private life.

Asian and American Leadership Styles: How are They Unique? 2005 article by Harvard Professor Prof D. Quinn Mills,

Updated  17 Feb 2019, 18 August, 2014,  10.2.2012, 11.12.2011

February 12, 2019

Productivity Control - Productivity Management

Productivity is a major concern in 1990s and will be one of the major concerns in the future also.

Productivity implies measurement and thus is connected to control in which also measurement is important.

Industrial engineering is the profession with focus on efficiency and productivity in engineering products, activities, processes and production systems. IIE's describes itself as the global association of efficiency and productivity professionals.

Productivity of knowledge workers is yet to be operationalized for measurement and improvement.

Koontz and O'Donnell and Weirich covered Operation related productivity improvement techniques in this chapter.

Operations research
Time event networks
Value engineering
Work simplification
Quality circles

In some editions of the book on Management, Koontz, O'Donnell and Weirich said, in reality, the entire book of management is about productivity.

14th Edition

In 14th Edition, Chapter 20 is titled as  Productivity, Operations Management, and Total Quality Management.

The authors, say in a real sense, this whole book is about the improvement of productivity. How it will receive special attention in this chapter.

Undoubtedly, productivity is one of the major concerns of managers in the 21st century.

Productivity is the output-input ratio within a time period with due consideration for quality. Measurement of skill work is relatively easy, but it is more difficult for knowledge work.

Good management results in improvement of productivity.

Tools and Techniques for Improving Productivity

Value Engineering

Specific Steps:

1. Divide the product into parts.
2. Identify the costs for each part.
3. Identify the relative value of each part with respect to the  lowest cost design alternative for a similar function.
4. Find a new approach for those items that appear to have a high cost and low value.

Work Simplification

This is a process of obtaining the participation of workers in simplifying their work. Training sessions are conducted to teach concepts and principles of techniques such as time and motion studies, work flow analyses, and the layout analysis methods.

Just-in-Time Inventory System

In this inventory system, safety stocks are drastically reduced. , Set up cost or ordering cost is also drastically reduced giving low batch quantities for production and ordering. There is emphasis on zero defects, and any defective part found during the subsequent operation is immediately sent back to the earliest state for repair and the reasons for the defect occurrence is investigated and corrected. For the system to work, dependable relations with suppliers are required and also well planned transport arrangement that collect parts frequently in a day from many suppliers in small quantities is required. Japanese companies have made successful implementation of JIT systems and rest of the world is now redesigning its systems to implement JIT system and improve productivity.

Lean Manufacturing

A study by MIT team on American, Japanese and European car manufacturers showed that Japanese were more productive as they use fewer workers, a shorter development time, lower inventories, few suppliers, less production space, and less investment to produce more models. Their delivery times are also small. MIT team named the Japanese systems as Lean Systems and popularised Lean manufacturing.

Lean manufacturing is creative application of industrial engineering by the Japanese IEs and managers and is now a popular productivity improvement methodology all over the world.

Managing Productivity

From Management, 11th Edition, Stephen P.. Robbins, and Mary Coulter

Improving productivity is an important and major goal in virtually every organization. For countries, 
high productivity can lead to economic growth and development. Employees can receive higher wages and company profits can increase without causing inflation. For individual organizations, increased productivity gives them a reduction in cost  and thus the ability to offer more competitive prices.

Over the past decade, U.S. businesses have made dramatic improvements to increase
their efficiency. 


The Latex Foam International’s state-of-the-art digital facility in Shelton, Connecticut, boosted capacity by 50 percent in a smaller space but with a 30 percent efficiency gain.

Service companies and departments  are also  pursuing productivity gains. 

Pella Corporation’s purchasing office improved productivity by reducing purchase order entry times anywhere from 50 percent to 86 percent, decreasing voucher processing by 27 percent, and eliminating 14 financial systems. Its information technology department slashed e-mail traffic in half and implemented work design improvements for heavy PC users such as call center users. The human resources department cut the time to process benefit enrollment by 156.5 days. And the finance department now takes 2 days instead of 6 to do its end-of-month closeout.

For global companies also improving productivity is an important objective and route to increase competitiveness. 

McDonald’s Corporation drastically reduced the time it takes to cook its french fries—65 seconds as compared to the 210 seconds it once took, saving time and other resources.

The Canadian Imperial Bank of Commerce, based in Toronto, automated its purchasing function, saving several million dollars annually.

Skoda, the Czech car company,  a subsidiary of Germany’s Volkswagen AG, improved its productivity through an intensive restructuring of its manufacturing process.

Productivity is a composite of people and operations variables. To improve productivity, managers must focus on both. 

The late W. Edwards Deming, a renowned quality expert, believed that managers, not workers, were the primary source of increased productivity. Some of his suggestions for managers included planning for the long-term future, never being complacent about product quality, understanding whether problems were confined to particular parts of the production process or stemmed from the overall process itself, training workers for the job they’re being asked to perform, raising the quality of line
supervisors, requiring workers to do quality work, and so forth.

High productivity can’t come solely from good “people management.” The truly effective organization will maximize productivity by successfully integrating people into the overall operations system. 

At Simplex Nails Manufacturing in Americus, Georgia, employees were involved as an integral part of the company’s much-needed turnaround effort.  Some production workers were made part of  a plant-wide cleanup and organization effort, which freed up floor space. The company’s sales force was retrained and were involved in developing ways to sell what customers wanted rather than what was in inventory. The results were dramatic. Inventory planning was changed on the basis of more accurate and reliable information, and was reduced by more than 50 percent.  The plant now has  20 percent more floor space, orders became more consistent, and employee morale improved. The company recognized the important interplay between people and the operations system.

Updated 13 February 2019,  12 Feb 2016,  12 Feb 2014

Design for Productivity - Productivity Engineering - Product Industrial Engineering

Design for Productivity - A Productivity Engineering Task

February 4, 2019

Summary - Principles - Staffing

Related to the Purpose of Staffing

Principle of staffing objectives

The positions provided by the organization structure must be staffed with personnel able and willing to carry out the assigned functions.

Principle of staffing

The quality of management personnel can be ensured through proper definition of the job and its appraisal in terms of human requirements, evaluation of candidates and incumbents, and appropriate training.

The process of staffing

Principle of job definition

Specifications for the job rest on organization requirements and on provision for incentives to induce effective and efficient performance of the tasks involved.

(I checked on 5 Feb 2019. Koontz and O'Donnell use the word incentives.)

Principle of managerial appraisal

Performance must be appraised against the management action required by superiors and against the standard of adherence in practice to managerial principles.

Principle of open competition in promotion

Managers should be selected from among the best available candidates for the job, whether they are inside or outside the enterprise.

Principle of management development

The objective of management development is to stengthen existing managers. The most effective means of developing managers is to have the task performed primarily by a manager's superior.

Principle of universal development

The enterprise can tolerate only those managers who are interested in their continuous development.


Harold Koontz and Cyril O’Donnell, Principles of Management: An Analysis of Managerial Functions, 4th Ed., McGraw-Hill, New York, 1968

Harold Koontz and Cyril O’Donnell, Principles of Management: An Analysis of Managerial Functions, 2nd Ed., McGraw-Hill, New York, 1959

Updated  5 Feb 2019
First published on  11 December 2011

February - Management Knowledge Revision with Links


Frank Gilbreth
Picture Source:

Febuary 1st Week  1 - 5 ,

The Nature of Organizing - Review Notes
Departmentation in Organizations - Review Notes

Line-Staff Authority and Decentralization - Review Notes
Effective Organizing and Organizational Culture - Review Notes

Summary - Principles - Organizing
Human Resource Management and Selection

Performance Appraisal and Career Strategy
Manager and Organization Development

Summary - Principles - Staffing
Resourcing; A Function of Management

February 2nd week,  8 to 12

Human Factors and Motivation
Leadership - Koontz and O'Donnell - Review Notes

Supervision - Introduction - Public Administration Point of View
Committes and Group Decision Making - Review Notes

Communication - Koontz and O'Donnell - Review Notes
Summary of Principles - Directing - Leading

The System and Process of Controlling - Review Notes
Control Techniques and Information Technology

Productivity Control
Overall Control and Preventive Control - Review Notes

February 3rd Week  (15 - 19)

Summary - Principles of Controlling
Global and Comparative Management

Organizing - Global Management Issues - Review Notes
Staffing - Global Management Issues

Leading - Global Management Challenges
Controlling - Global Management Challenges - Review Notes

Management and Entrepreneurship: Science, Theory and Practice
Managerial Skills

Principles of Management - List
Principles of Management - Subject Update Articles Recent Years

February 4th Week  (22 to 26)

Marketing Management Revision Articles

The Marketing Concept Kotler
Marketing Strategy - Marketing Process - Kotler's Description

Scanning of Environment for Marketing Ideas and Decisions
Marketing Strategy - Differentiating and Positioning the Market Offering

Management of Marketing Department and Function
Marketing Research and Market Demand Forecasting

Consumer Behavior
Analysis of Consumer Markets

Organizational Buying Processes and Buying Behavior
Market Segmentation and Selection of Target Segments

To March - Management Knowledge Revision

Industrial Engineers support Engineers and Managers in Efficiency Improvement of Products, Processes and Systems

One Year MBA Knowledge Revision Plan

January  - February  - March  - April  - May   -   June

July  - August     - September  - October  - November  - December

Updated 2018 - 24 February

  1 Februry 2017, 16 Feb 2016, 22 Feb 2016

Resourcing - A Function of Management

A Manager's Job is to get results through people and other resources. Hence acquiring all resources (including human resources) is a function of management. - Narayana Rao (2010)

Resourcing is a function of Management. Resource Efficiency Improvement is a function of Industrial Engineering. Narayana Rao (5 February 2019)

Linkedin Post in IISE Group

The article was first published on Knol in 2010.

Replace the Function Staffing by Resourcing in Functions of Management

Koontz and O'Donnell outlined Planning, Organizing, Staffing, Directing and Controlling as the five functions of management and explained the process of management of these five functions.

In the place of staffing, using the word resourcing, could be a better description of management function at the current stage.

A plan to achieve something (objective) is to be  converted into an organizational plan that has resources,  facilities and people. The manager has to acquire these resources to set up the organization to implement his plan. Acquisition of human resources is staffing. But normally in modern business, the manager has to acquire money resources or finance. Then, using capital and finance, he has to  acquire land, buildings, machinery, materials and various other services. Then comes directing and resource allocation (execution).

During control phase, replanning takes place, reorganization can take place, resource adjustment (resource acquisition or disposal) may take place, and redirecting may take place to achieve the goals set forth for a period.

Planning involves choosing a direction and an intermediate destination. It has to be a profitable and a useful endeavor. In the process of planning cost benefit analysis is done.  Organizing follows and the means by which one reaches the chosen destination is defined during this activity of management.

Organizing is a process of

  • determining, grouping and structuring activities
  • creating roles for individuals for effective performance at work
  • allocating necessary authority (over resources) and responsibility for results for each role
  • determining detailed procedures and systems for different problem areas such as coordination, communication, decision-making, motivation, conflict resolution and so on.

The resources required to achieve a goal are to be identified during the organizing step of management. How many operators are required and how many supervisors are required is a function of technology employed in the organization and this decision has to be taken during the process of organization. Resourcing follows the organizing phase in the acquiring of the resources planned in the organizing phase. Organizing this way is just the planning stage. Resourcing is the stage during which all resources planned in the organizing stage are acquired by the manager.

Resource Planning 

Resource planning is an economic decision and entrepreneurs have to use it. It is discussed adequately in economics.

Choice of Inputs by the Firm

Every firm or entrepreneur has to decide how much of each input it should employ: how much labor, capital, land, energy, various materials and services.

The fundamental assumption that economists make in this context is that of cost minimization. Firms are expected to choose their combination of inputs so as to minimize the total cost of production.

Least-cost Rule: To produce a given level of output at the least cost, a firm will hire factors until is has equalized the marginal product per dollar spent on each factor of production. This implies that

Marginal product of labor/price of labor  = Marginal Product of Capital Equipment/Price of capital equipment = ...

Thus the firm will choose a factor combination or resource combination that minimizes the total cost of production.  (Source: http://nraomtr.blogspot.com/2011/12/economic-theory-of-production-and.html  )


Recognition of Role of Resources in Management Process by Various Authors of Principles of Management or Management Process Books

Ernest Dale

Goals and Resources

Once objectives have been set,the planners must decide how far they can proceed toward them in view of the resources available, which include the money on hand, the money that sales will bring, and the funds that may be obtained by borrowing or selling equities. The decision to borrow or sell new stock will, of course, be part of the planning process and will depend on the return expected on the investment.

Finally, the planners must decide on the allocation of the funds to the various company activities and the way in which these funds will be used to generate greater income in the form of sales.  The volume of sales is, in fact, the key factor in all corporate planning.

Ernest Dale, Graduale School of Business, University of Virginia, Management: Theory and Practice, McGraw-Hill Book Company, New York, 1965, p.352, Chapter 22. Planning and Forecasting.

An interesting entry in Wikipedia - Resource Management

In organizational studies, resource management is the efficient and effective deployment for an organization's resources when they are needed. Such resources may include financial resources, inventory, human skills, production resources, or information technology (IT). In the realm of project management, processes, techniques and philosophies as to the best approach for allocating resources have been developed. These include discussions on functional vs. cross-functional resource allocation as well as processes espoused by organizations like the Project Management Institute (PMI) through their Project Management Body of Knowledge (PMBOK) methodology to project management. Resource management is a key element to activity resource estimating and project human resource management. Both are essential components of a comprehensive project management plan to execute and monitor a project successfully
Resourcing and Resouce Planning Departments
Office of Resource Planning, Universit of Regina

A new concept being developed as enterprise architecting clearly brings out the need for organizing material and human organizations and provides a process for developing the both organization. From this organization output, resource requirements will be clearly specified and during the resourcing function, manager has to acquire the resources specified in the organization structure.

Harvard Business Essentials on Resource

In the book, Coaching and Mentoring: How to Develop Top Talent and Achieve Stronger Performance, published by Harvard Business School Publishing Corporation, in 2004

Page 2

A Manager's Job is to get results through people and other resources.

Industrial Engineering

Resourcing and resource allocation is Manager's job. Resource efficiency (using resources efficiently) is the concern of Industrial engineers

PPT of Salah R. Agha, Professor Industrial Engineering, Islamic University of Gaza on Facilities Planning and Materials Handling

Indicates role of IEs.

Facilities Planning

James A. Tompkins, John A. White, Yavuz A. Bozer, J. M .A. Tanchoco
John Wiley & Sons, 19-Jan-2010 - Technology & Engineering - 864 pages

When it comes to facilities planning, engineers turn to this book to explore the most current practices. The new edition continues to guide them through each step in the planning process. The updated material includes more discussions on economics, the supply chain, and ports of entry. It takes a more global perspective while incorporating new case studies to show how the information is applied in the field. Many of the chapters have been streamlined as well to focus on the most relevant topics. All of this will help engineers approach facilities planning with creativity and precision.


Resourcing Activity is well described in Project Management Literature.

Resourcing - An Important Activity in Project Management

Related topics

The Nature and Purpose of Planning
The Nature of Organizing
Resourcing - A Function of Management
Leading - Introduction
Planning and Execution - Theory and Practice
The System and Process of Controlling

Updated  5 February 2019,  10 August 2018,  3 July 2017,   26 July 2016,  1 Feb 2016, 17 Sep 2015, 25 Feb 2014
Updated 17.3.2012
Original knol - resourcing-a-function-of-management    2utb2lsm2k7a/ 2345

Details of the Knol

Resourcing - A Function of Management

Narayana Rao

All Rights Reserved

Version 14

Last edited: 02 Mar 2010

Exported: 26 Nov 2011

Original Knol Number 2345

January 23, 2019

Peter Drucker - Business Organization - Economic Function - Social Responsibility

In the book, In The End of Economic Man, published in 1939, Drucker explained what had happened when central European managers had failed to meet social responsibilities. The managers had valued people only for their labor and treated them as factors of production. As they were treated like things, people had felt isolated and governed by irrational, "demonic forces" that do not think of their weillbeing. Society had ceased to be a community of individuals bound together by a common purpose in various institutions.

In a desperate situation, some were drawn to Marxism, which in turn undercut traditional values and institutions and paved the way for Fascist dictatorships. Both Fascism and Marxism, as Drucker saw them, were escapist; they could thow out established order using existing discontent as leverage but never fulfill human needs.

People need a society that could provide freedom, "status," and "function," and it is the task of business managers to help create such a society by shaping the workforce into the industrial citizens and the company into a community.

In subsequent works, particularly in The Future of Industrial Man (1942), Concept of the Corporation (1946), and The New Society (1949), Drucker emphasized that only satisfying work could fulfill the needs of individuals for autonomy, security, dignity, usefulness, belonging, and peer respect. Work was needed as much to provide "status and function" as income. People will be frustrated when managers valued labor only as a commodity. Through responsible acts of "citizenship" by manager and worker alike, the social and the economic needs of the individual, could be brought into "harmony" and thus fulfilled in the business organization.

In the case of managerial goals, Drucker acknowledged that economic goals must come before social ones. If the firm went bankrupt, managers would be unable to sutain the corporate community. Corporate "survival" depended on making a profit that not only covered costs but provided insurance against future risks. To make such a profit, managers must "create" customers by providing them with useful products and services.

The primacy of economic performance, however, should not obscure the thought that the business corporation was "as much a social organization, a community and society" as it was "an economic organ." In the "new society," which was an employee society, the firm had a responsibility to realize social values and fulfill individual needs.

Drucker expanded his ideas in later years by insisting that managers select socially responsible goals for the enterprise. He rejected the power of the market and the notion that a "hidden-hand" in the marketplace naturally converted "private vices" into "public virtues." He had never believed that competition automatically solved social problems. He diagreed with Milton Friedman's argument that businessmen should stick to "business" and should refrain from appointing themselves guardians of the common good. According to Drucker, business men were running social organizations that could help society and realize "social values." Like anyone else, they also had "a self-interest in a healthy society," and so they should follow normal ethical imperatives. Moreover, for Drucker, managers were the only true "leadership group" in modern society. If they did not "take responsibility for the common good," then no one else could or would.

Stephen P. Waring, "Peter Drucker, MBO, and the Corporatist Critique of Scientific Management" in
A mental revolution: scientific management since Taylor, Nelson, Daniel

Joint article for Management Revision of the day: Business Conceptualization - Management Insights from Economics, Engineering Economics, Managerial Economics, Industrial Economics

January Month Management Knowledge Revision Plan

MBA Core Management Knowledge - One Year Revision Schedule

Updated 24 Jan 2019, 22 Jan 2016, 28 Nov 2011

Business Firm and Society - The External Environment, Social Responsibility and Ethics - Review Notes

Koontz and O'Donnell - Principles of Management Book Chapter

Managers of business firms or organizations in other walks of life are operating in pluralistic societies in which many groups represent various interests.

Enterprises do not live unto themselves alone. They are interlocking institutions that man has found it beneficial to organize to serve his needs. The family came into existence, then tribe, government, army, education, religion etc. slowly came into existence. The proliferation of institutions and enterprises has proceeded down to our day, where they often exist in bewildering confusion.

No ideal situation exists. People or individuals vary from stupid to the genius, from the passive to the  aggressive, from kind to the cruel, from the slothful to the energetic, from the cunning to the artless, from the humble to the proud. In an ideal society, the individuals would in concert determine when and which institutions and enterprises they would create to better serve themselves. But in practice many institutions and enterprises which have been created to serve them are the products of aggressive leaders-the few who care for many. They may not create always with care motive, they may do it for self-aggrandizement also.

The Historical Function of Business

Koontz and O'Donnell cite the explanation by economists. Economics conceives a business to be any activity that is concerned with the production (or purchase) for sale of scarce goods and services.The purpose of economic activity is always the same: it is to employ human and natural resources, and the man made capital equipment and components in the production of goods and services which the ultimate consumers want. Thus the purpose of business is to satisfy the economic wants of people, and since resources are scarce, their efficient use is a moral requirement.

Economic Organization of the Society or Country

The typical organizational patterns include free enterprise, socialism, communism, and the welfare state.

The Business of Business

There is no doubt whatever that the function of business is to make economic goods and services available for consumption. But it is not enough to produce economic goods; the first duty of business is to produce them efficiently.

Efficiency in resource employment is undoubtedly best achieved through free enterprise. It is the business of state to make sure through legislation and regulation that the private economy does not fail in its function to efficiently utilize resources to maximize the satisfaction of consumer wants for economic goods and services. The states are not able to do it by means of a monolithic bureaucracy as per the available experience.

External Environment and Stakeholders



Price Levels

Government policies

The term technology refers to the sum total of the knowledge we have of ways to do things.



Social attitudes, beliefs, and values

Business Ethics

The practice of ethics is one of the social responsibilities of business. Unethical conduct is highly publicized whenever it is found, but most of the "sharp practices" remain hidden within the organizations or their networks.

Morals are customs with a high degree of social acceptance.

Business and professional codes

Koontz and O'Donnell note that widespread tendency of business groups and professional people to adopt codes of conduct has scope to further ethical practices and development of science of ethics. Examples of codes of conduct include those of medical, legal and accounting professions.

Purpose of declaring codes of conduct

The usual reasons are two. In the first place, it is considered that the publication of a code of ethics will improve the confidence of the customer, client, patient, or voter in the quality of service he may expect. A second reason is to assure standard practices in the relationships between members themselves. McGuire pointed out two additional reasons. They can be used as a crutch by the weak to refuse to do unethical acts. They also help in detection of unethical behavior in competitors and employees.

Businessmen have an obligation to all others in society to use scarce resources efficiently and, in so doing, to make certain that every decision stands firmly upon the applicable moral customs and any generally accepted ethical principles.

Sentences from Harold Koontz and Cyril O'Donnell,  Principles of Management, Fourth Edition, McGraw-Hill, New York, 1968, on Efficiency.

p. 742

The goal of all managers in all enterprises must be the effective accomplishment of purpose (whatever it is) with the most efficient utilization of resources-human and material-at their disposal.

The purpose of business is to satisfy the economic wants of people, and, since resources are scarce, their efficient use is a moral requirement.

p. 744
It is not enough to produce economic goods; the first duty of business is to produce them efficiently.

Since businessmen obtain control scarce resources by the purchase or lease of land and capital and hire human services, they have a moral responsibility for using them efficiently in the production

It is the business of the state to make sure through legislation and regulation that the private economy does not fail in its function to efficiently utilize resources to maximize the satisfaction of consumer wants for economic goods and services.

Updated 24 January 2019, 29 Jan 2015, 12 December 2011

Part of

January - Management Knowledge Revision


January - Industrial Engineering Knowledge Revision Plan