CSEET · Business Laws and Management

Management Knowledge for Company Secretaries: formula sheet

Full chapter guide

Key formulas

Definition of management: Management = Planning + Organising + Staffing + Directing + Controlling, to achieve goals; Functions can be listed slightly differently in different books; check the options given.
Effectiveness vs efficiency: Effectiveness = doing the right task; Efficiency = doing the task right (least cost); Effectiveness is about the end, efficiency is about the means.
Levels of management: Top (strategic) → Middle (tactical) → Lower/supervisory (operational); Top level decides policy; middle level implements; lower level supervises workers.
Nature of management: Art (skill in application) + Science (organised principles) + Profession (partly); Management does not meet every test of a full profession, such as a compulsory licence.
Three groups of objectives: Organisational + Social + Personal; Organisational objectives include survival, profit and growth.
Five functions of management: Planning → Organising → Staffing → Directing → Controlling; Learn the order. Planning comes first because every other function depends on the goals it sets. Controlling feeds back into planning.
Planning: Planning = deciding in advance what to do, how to do it and who will do it; Key words: goals, objectives, forecast, policy, budget, strategy, 'look ahead'.
Organising: Organising = assigning duties + grouping jobs + setting authority relationships + allocating resources; Key words: structure, departments, delegation, reporting lines, chain of command.
Staffing: Staffing = recruitment + selection + training + appraisal + remuneration of people; Key words: hiring, placement, training, promotion, performance appraisal.
Directing: Directing = supervision + motivation + leadership + communication; Key words: guide, instruct, inspire, lead, 'getting people to work'.
Controlling: Controlling = set standards → measure actual performance → compare → take corrective action; Key words: standards, deviation, corrective action, comparing actual with planned.
Fayol's 14 principles: 1 Division of work; 2 Authority and responsibility; 3 Discipline; 4 Unity of command; 5 Unity of direction; 6 Subordination of individual interest to general interest; 7 Remuneration of personnel; 8 Centralisation and decentralisation; 9 Scalar chain; 10 Order; 11 Equity; 12 Stability of tenure of personnel; 13 Initiative; 14 Esprit de corps; Memory aid: count them in this order. Unity of command means one boss for one employee. Unity of direction means one plan for one group of activities with the same objective.
Taylor's principles of scientific management: Science not rule of thumb | Harmony not discord | Cooperation not individualism | Maximum output not restricted output | Development of workers; Learn the 'not' pairs. MCQs often swap one half of a pair to create a wrong option.
Taylor's techniques: Time study, motion study, fatigue study, method study, standardisation, differential piece-rate, functional foremanship; Time study measures how long; motion study checks how the body moves.
Taylor vs Fayol focus: Taylor = shop floor, efficiency of work | Fayol = top management, general administration; Taylor is the father of scientific management. Fayol is the father of general (administrative) management.
Order of management schools: Classical (scientific + administrative) → Behavioural/Human relations → Quantitative → Systems → Contingency; Use this order to answer 'which came later' questions.
Steps in the planning process: Be aware of opportunity → Set objectives → Develop premises → Identify alternatives → Evaluate alternatives → Choose the best → Formulate supporting plans → Implement and follow up; Textbooks word and number these steps a little differently. Learn the order and the logic: objectives first, action last.
Standing plans: Policies, procedures, methods, rules; Reused for recurring situations.
Single-use plans: Programmes, projects, budgets; Made for one occasion or period. Not reused.
MBO cycle: Set objectives together → Plan action → Work and monitor → Review performance → Give feedback and reset objectives; Joint goal setting is the key feature.
Decision making process: Identify problem → Gather information → Develop alternatives → Evaluate → Select → Implement → Follow up; Follow-up checks whether the decision worked.
Types of decisions: Programmed vs non-programmed; strategic, tactical, operational; individual vs group; Programmed decisions are routine. Non-programmed ones are new and unstructured.
Delegation elements: Delegation = Assignment of duty + Granting of authority + Creation of obligation; Learn the three elements in this order. Questions often ask which one is missing.
Authority and accountability: Authority flows downward; accountability flows upward; Accountability cannot be delegated. The delegating manager remains answerable.
Parity principle: Authority should match responsibility; Responsibility without enough authority makes a subordinate ineffective.
Line vs staff: Line = command; Staff = advice and support; Staff have no power to command line managers.
Delegation vs decentralisation: Delegation = process between two people; Decentralisation = organisation-wide policy; Decentralisation is delegation applied systematically at all levels.
Maslow's order of needs (bottom to top): Physiological → Safety → Social → Esteem → Self-actualisation; Lower needs must be reasonably met before higher needs motivate. Remember it as: Please Say Sorry, Everyone Slips.
Herzberg's two factors: Hygiene factors prevent dissatisfaction; Motivators create satisfaction; Hygiene: pay, policy, conditions, supervision, security. Motivators: achievement, recognition, responsibility, growth.
McGregor's assumptions: Theory X = people dislike work, need control; Theory Y = people are self-directed, seek responsibility; Theory X suits close supervision; Theory Y suits participation and delegation.
Leadership styles: Autocratic = leader decides; Democratic = leader consults; Laissez-faire = group decides; Decision-making power is the clue that identifies the style.
Communication process: Sender → Encoding → Message through Channel → Decoding → Receiver → Feedback; Noise can interfere at any stage. Feedback completes the cycle.
Control process steps: Set standards → Measure actual performance → Compare with standards → Analyse deviations → Take corrective action; Keep this order. Many MCQs ask which step comes first or next.
Deviation: Deviation = Actual performance − Standard; Management by exception: attend only to significant deviations.
Types of barriers: Semantic, Psychological, Organisational, Personal; Classify each example by its cause.
Coordination: Coordination = Unity of action toward a common goal; Called the essence of management because it runs through all functions.
Control techniques: Budgetary control, Standard costing, Ratio analysis, Break-even analysis, Internal audit, MIS, PERT/CPM; Traditional and modern techniques are both asked. Match the technique to its use.
CS as manager: CS = Adviser + Compliance officer + Governance guardian + Administrator; A memory aid for the main roles. Use it to classify a task in an MCQ.
Position in the company: CS = Key Managerial Personnel (KMP) = part of top management; The CS is a KMP where the law requires the company to have one. Do not describe the CS as a mere clerk or outsider.
Bridge function: Board ↔ CS ↔ Shareholders, regulators, auditors, other stakeholders; The CS communicates in both directions and keeps all parties informed.
Skill groups: Knowledge skills + People skills + Ethical and personal qualities; Knowledge: law, finance, governance. People: communication, leadership, teamwork. Ethical: integrity, confidentiality, objectivity.

Quick revision

Management is getting work done through people to achieve organisational goals.
The main functions are planning, organising, staffing, directing and controlling, with coordination running through all of them.
Management is both a science and an art, and it is widely treated as a profession with some limits.
Planning looks ahead and decides what to do; decision making is choosing one course from alternatives.
Authority is the right to give orders; responsibility is the duty to complete the task; accountability is answering for results.
Delegation means assigning authority to a subordinate, but the delegator remains accountable.
Scientific management is linked with F. W. Taylor; the 14 principles of management are linked with Henri Fayol.
Maslow's theory arranges human needs in a hierarchy from basic to self-actualisation.
Leadership is influencing people to work willingly towards goals; know the common styles such as autocratic, democratic and laissez-faire.
Communication is a two-way process of sharing information and understanding between sender and receiver.
Control compares actual results with standards and corrects deviations.
A company secretary acts as a link between the board, shareholders, regulators and management.

Common mistakes

Saying management is a full profession like medicine or law. Fix: Remember that there is no compulsory licence and no single statutory body for all managers. Call it a developing or emerging profession.
Calling management an exact science. Fix: Management principles are flexible because they deal with human behaviour. Say it is a science with less exactness, or a 'soft' science.
Treating unity of command and unity of direction as the same. Fix: Unity of command is about one employee receiving orders from one superior. Unity of direction is about one head and one plan for activities with the same objective.
Calling hiring and training 'directing'. Fix: Recruitment, selection, training and appraisal belong to staffing. Directing is about supervising, motivating, leading and communicating.
Attributing the 14 principles to Taylor. Fix: Link Fayol with 14 principles and administration. Link Taylor with five principles and the shop floor.
Mixing up time study and motion study. Fix: Time study fixes the standard time. Motion study removes unnecessary movements.
Calling a budget a standing plan. Fix: A budget is made for a specific period and purpose. Treat it as single-use in exam answers.
Mixing up objectives and plans. Fix: Objective is the end result. Plan is the way to reach it.
Saying a manager can delegate accountability along with authority. Fix: Remember that authority and the task are delegated, while the manager stays answerable for the final result.
Treating delegation and decentralisation as the same thing. Fix: Delegation is a process between a manager and a subordinate. Decentralisation is a policy of spreading decision power across the whole organisation.

Exam tips

In Paper 4 there is no negative marking, so attempt every question. Eliminate extreme options first and guess among the rest.
Learn the seven characteristics as one-word keywords. Questions usually describe a feature and ask you to name it.
Prepare a three-line table in your head: top, middle, lower, each with its typical designations and main task.
For nature questions, the correct option is usually the balanced one: art and science, and a developing profession.
Use the 15 minutes of reading time to mark management questions in Part B that you can answer in seconds.
Memorise the five functions in order and one key word for each. Most MCQs reduce to this matching.
Learn all 14 principles with a one-line meaning each, and give extra time to the look-alike pairs.
In case-based questions, name the function by what the manager is doing, not by the manager's job title.