Theory of management

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Theory of management
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Management is a multi-disciplinary area of study. It encompasses all of the activities aimed at the organization’s resources of which aim is to achieve the organization’s objectives in an efficient and effective manner. The core of the word “manage” comes from the Latin word “manus” (hand), which clearly indicates its utility, manipulative character in the sense of which a man uses his hands when performing various tasks. Managing involves all actions undertaken to make the others (people, institutions, organizations) to act as the manager commands. Synonyms: directing, control, governance, leadership.

Forms of management

The term management has the widest range of conceptual forms such as:

  • management - where the exercise of power results from the ownership of the means of production,
  • governance - where power is based on the applicability of legal coercion,
  • forcing (compulsion) - where governance is an illegal action,
  • leadership - where governance refers to the informal influence on organization.

Both terms governance and leadership are derived from the concept of "control", which means "any intentional impact of one system to another in order to obtain such process changes or state of a system which is considered to be desirable." Management is the process of regulating the conduct of personnel, which leads to achievement of the objective pursued by the executive: the process takes place in the system of organizational dependence.

Management is also the sphere of practical activity (specific profession performed by officers, managers, etc.) in which it is necessary to solve a number of problems concerning the organization and functioning of modern institutions. It is also discipline of knowledge, which follows the practice, developing general concepts and methodological solutions in response to the demands by managers

Basic Management Functions

Management is structured process of planning, organizing, human resource management, and control performed to achieve common goals. The process of using of the organization's resources to achieve its objectives through the functions of planning and decision making, organizing, leadership and control.

There are four basic management functions: planning, organizing, leading and motivating and controlling.

  1. Planning is setting the goals (aims, objectives) for the organization, resource allocation and making decision how to accomplish them. It is the first function of management because all the others depend on it.
  2. Organizing is second major function of management which involves grouping of resources and activities to perform some end result in an effective and efficient manner, task allocation, coordination, communication, etc.
  3. Leading and motivating - refers to human resources within an organization. Leading can be defined as the process of influencing (encouraging) people to work to achieve common goals. Motivating encompasses providing reasons for people to work in the best interests of an organization. Leading, inspiring and motivating together are often referred to as directing.
  4. Controlling is the last step of the management process. Controlling can be defined as regulating and evaluating ongoing activities to ensure that goals are accomplished. This function involves three steps: setting standards, measuring actual performance and taking corrective action (if necessary).

Levels of management

Managers can be classified according to their level within an organization:

  1. Top-level managers - also called as “executives”; guiding and controlling the overall fortunes of an organization; job titles associated with this level of management are: president, vice president and CEO (chief executive president);
  2. Middle managers - involving the largest group of managers; job titles associated with this level of management are: department head, production manager, chief engineer, commercial manager.
  3. First-line managers - supervising the actions of operating employees; job titles associated with this level of management are: assembly supervisor, billing supervisor, office manager.

Main areas of interest of modern managers

See also:


  • Cole, G. A. (2004). Management theory and practice. Cengage Learning EMEA.
  • Drucker, P. F. (1995). People and performance: The best of Peter Drucker on management. Routledge.
  • Hersey, P., & Blanchard, K. H. (1993). Management of organizational behavior: Utilizing human resources. Prentice-Hall, Inc.
  • Likert, R. (1967). The human organization: its management and values.
  • Taylor, F. W. (1914). The principles of scientific management. Harper.
  • Weihrich, H. (2000). Management: Science, Theory, and Practice ‘. Software Engineering Project Management, 2nd edn., ed. RH Thayer (IEEE Computer Society Press, Los Alamitos, CA, 1997), 4-13.