Bureaucratic management,

one of the schools of classical management, emphasizes the need for organizations to
function on a rational basis. Weber (1864 1920), a contemporary of Fayol, was one of the
major contributors to this school of thought. He observed that nepotism (hiring of relatives
regardless of their competence) was prevalent in most organizations. Weber felt that
nepotism was grossly unjust and hindered the progress of individuals. He therefore identified
the characteristics of an ideal bureaucracy to show how large organizations should be run.
The term bureaucracy (derived from the German buro, meaning office) referred to
organizations that operated on a rational basis. According to Weber, a bureaucracy is a highly
structured, formalized, and impersonal organization. In other words, it is a formal
organization structure with a set of rules and regulations. The characteristics of Weber's ideal
bureaucratic structure are outlined. These characteristics would exist to a greater degree in
ideal organizations and to a lesser degree in other, less perfect organizations.

Major Characteristics of Weber's Ideal Bureaucracy

Characteristic
Work specialization and division of labor
Abstract rules and regulations
Impersonality of managers
Description
The duties and responsibilities of all the
employees are clearly defined. Jobs are
divided into tasks and subtasks. Each
employee is given a particular task to
perform repeatedly so that he acquires
expertise in that task
The rules and regulations that are to be
followed by employees are well defined to
instill discipline in them and to ensure that
they work in a co-coordinated manner to
achieve the goals of the organization
Managers make rational decisions and
judgments based purely on facts. They try to
be immune to feelings like affection,
enthusiasm, hatred and passion so as to
remain unattached and unbiased towards

Hierarchy of organization structure
their subordinates
The activities of employees at each level are
monitored by employees at higher levels.
Subordinates do not take any decision on
their own and always look up to their
superiors for approval of their ideas and
opinions

Behavioral Approach

The behavioral school of management emphasized what the classical theorists ignored the
human element. While classical theorists viewed the organization from a production point of
view, the behavioral theorists viewed it from the individual's point of view. The behavioral
approach to management emphasized individual attitudes and behaviors and group processes,
and recognized the significance of behavioral processes in the workplace.

It gives an overview of the key contributions to management theory by the behavioral

management school of thought.

Elton Mayo: Focusing on Human Relations

Elton Mayo (1880 1949), the Father of the Human Relations Approach, led the team which
conducted a study at Western Electric's Hawthorne Plant between 1927 and 1933 to evaluate
the attitudes and psychological reactions of workers in on-the-job situations. The researchers
and scholars associated with the Hawthorne experiments were Elton Mayo, Fritz
Roethlisberger, T N Whitehead and William Dickson. The National Research Council
sponsored this research in cooperation with the Western Electric Company. The study was
started in 1924 by Western Electric's industrial engineers to examine the impact of
illumination levels on worker productivity. Eventually the study was extended through the
early 1930s.

Limitations of Human Relations Approach

Human relations theory recognizes the significance of human resources. This theory believes
that each individual is unique and the attitude and behavior of an employee determines the
way he or she works. This theory is against the view that people respond automatically to
monetary stimulus. Human relations theory was one of the greatest advances in management,
yet, it did not succeed in establishing new concepts. Human Relations theory has made
noteworthy contributions to the field of management. It provides valuable guidance in
understanding the employees and managing them. This theory also states the importance of
attitudes and behaviors in managing the workforce effectively. Human Relations is one of the
foundations on which the building of management is to be built. Although this theory has
given great insights, it has its limitations also. This theory focuses more on the informal
group and is very vague about the positive motivation aspects.

The limitations of the Human Relations theory are:

The Human Relations theorists are of the opinion that by removing fear, people would
perform effectively. This view attacked the assumption that workers can be motivated
to work only through fear.
The Human Relations approach made a significant contribution at a time when it was
generally being assumed that workers have to be coerced to work. Yet, this approach
has very little to say about positive motivation. The positive motivation aspect has
been generalized by the Human Relations theorists.
Human Relations theory does not provide enough focus on work. It emphasizes more
on interpersonal relations and on the informal group. Consequently, this approach
assumes that a worker's attitudes, behavior and effectiveness is predominantly
determined by his relation with his fellow-workers and not by the kind of work he
does. Human Relations does not understand the economic implications of
organizational problems. Therefore, most of the principles advocated cannot be
applied in the organizational context. Human Relations theory also tends to be very
vague. It stresses on giving the workers a sense of responsibility but hardly tells what
their responsibilities are:

Comparison of Mayo and Hawthorne Studies

Comparison of Elton Mayo and the Hawthorne Studies

Pre-judgments Findings
Job performance depends on the individual The group is the key factor in job
worker performance.
. Fatigue is the main factor affecting output. Perceived meaning and importance of the
 work determine output.
Management sets production standards. Workplace culture sets its own production
standards.

Abraham Maslow: Focusing on Human Needs

In 1943, Abraham H. Maslow (1908 1970), a Brandeis University psychologist,

theorized that people were motivated by a hierarchy of needs. His theory rested on three
assumptions. First, all of us have needs which are never completely fulfilled. Second,
through our actions we try to fulfill our unsatisfied needs. Third, human needs occur in
the following hierarchical manner:

physiological needs
safety or security needs
belongingness or social needs
esteem or status needs
Self-actualization or self-fulfilment needs.

According to Maslow, once needs at a specific level have been satisfied, they no longer act
as motivators of behavior. Then the individual strives to fulfill needs at the next level.
Managers who accepted Maslow's hierarchy of needs attempted to change their management
practices so that employees'needs could be satisfied.

Douglas McGregor: Challenging Traditional Assumptions about Employees

Douglas McGregor (1906 1964) developed two assumptions about human behavior, which
he labeled Theory X and Theory Y. According to McGregor, these two theories reflect the
two extreme sets of belief that different managers have about their workers. Theory X
presents an essentially negative view of people. Theory X managers assume that workers are
lazy, have little ambition, dislike work, want to avoid responsibility and need to be closely
directed to make them work effectively. Theory Y is more positive and presumes that
workers can be creative and innovative, are willing to take responsibility, can exercise self-
control and can enjoy their work. They generally have higher-level needs which have not
been satisfied by the job.
Like Maslow's theory, McGregor's Theory X and Theory Y influenced many practicing
managers. These theories helped managers develop new ways of managing the workers.
Classical Approach

Classical management thought can be divided into three separate schools: Scientific
management, administrative theory and bureaucratic management. Classical theorists
formulated principles for setting up and managing organizations. These views are labeled
classical because they form the foundation for the field of management thought. The major
contributors to the three schools of management thought scientific management,
administrative theory and bureaucratic management are Frederick W. Taylor, Henry Fayol
and Max Weber respectively.

Scientific Management
Scientific management became increasingly popular in the early 1900s. In the early 19th
century, scientific management was defined as that kind of management which conducts a
business or affairs by standards established, by facts or truths gained through systematic
observation, experiment, or reasoning. In other words, it is a classical management approach
that emphasizes the scientific study of work methods to improve the efficiency of the
workers. Some of the earliest advocates of scientific management were Frederick W. Taylor
(1856 1915), Frank Gilbreth (1868 1924), Lillian Gilbreth (1878 1972), and Henry
Gantt (1861 1919).

Frederick Winslow Taylor

Frederick Winslow Taylor took up Henry Towne's challenge to develop principles of

scientific management. Taylor, considered father of scientific management, wrote The
Principles of Scientific Management in 1911. An engineer and inventor, Taylor first began to
experiment with new managerial concepts in 1878 while employed at the Midvale Steel Co.
At Midvale, his rise from laborer to chief engineer within 6 years gave him the opportunity to
tackle a grave issue faced by the organization the soldiering problem. Soldiering refers to
the practice of employees deliberately working at a pace slower than their capabilities.
According to Taylor, workers indulge in soldiering for three main reasons:

1. Workers feared that if they increased their productivity, other workers would lose
their jobs.
2. Faulty wage systems employed by the organization encouraged them to work at a
slow pace.
 3. Outdated methods of working handed down from generation to generation led to a
great deal of wasted efforts.

Four Steps in Scientific Management Step Description

Step 1 Develop a science for each element of the job to replace old rule of thumb methods.

Step 2 Scientifically select employees and then train them to do the job as described in Step
1.

Step 3 Supervise employees to make sure they follow the prescribed methods for performing
their jobs.

Step 4 Continue to plan the work but use workers to actually get the work done.

Essence

In essence, scientific management as propounded by Taylor emphasizes:

1. Need for developing a scientific way of performing each job.

2. Training and preparing workers to perform that particular job.
3. Establishing harmonious relations between management and workers so that the job is
performed in the desired way.

Frank and Lillian Gilbreth

After Taylor, Frank and Lillian Gilbreth made numerous contributions to the concept of
scientific management. Frank Gilbreth (1868 1924) is considered the father of motion
study. Lillian Gilbreth (1878 1972) was associated with the research pertaining to motion
studies. Motion study involves finding out the best sequence and minimum number of
motions needed to complete a task. Frank and Lillian Gilbreth were mainly involved in
exploring new ways for eliminating unnecessary motions and reducing work fatigue.

The Gilbreths devised a classification scheme to label seventeen basic hand motions such as
search, select, position, and hold which they used to study tasks in a number of industries.
These 17 motions, which they called therbligs (Gilbreth spelled backward with the't and h'
transposed), allowed them to analyze the exact elements of a worker's hand movements.
Frank Gilbreth also developed the micromotion study. A motion picture camera and a clock
marked off in hundredths of seconds was used to study motions made by workers as they
performed their tasks. He is best known for his experiments in reducing the number of
motions in bricklaying. By carefully analyzing the bricklayer's job, he was able to reduce the
motions involved in bricklaying from 18 to 4. Using his approach, workers increased the
number of bricks laid per day from 1000 to 2700 (per hour it went up from 120 to 350 bricks)
without exerting themselves.

Lillian's doctoral thesis (published in the early 1900s as The Psychology of Management)
was one of the earliest works which applied the findings of psychology to the management of
organizations. She had great interest in the human implications of scientific management and
focused her attention on designing methods for improving the efficiency of workers. She
continued her innovative work even after Frank's death in 1924, and became a professor of
management at Purdue University. Lillian was the first woman to gain eminence as a major
contributor to the development of management as a science. In recognition of her
contributions to scientific management, she received twenty-two honorary degrees.

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Closed System Vs Open System

Closed System View of Organizations The classical management theorists assumed that the
primary goal of organizations was economic efficiency, and that organizations were
essentially closed systems. Consequently, they regarded organizations as rational and
economic entities.

According to Louis E. Boone and David L Kurtz, Closed systems are sets of interacting
elements operating without any exchange with the environment in which they exist. This
definition implies that closed systems require no inputs

human, technical, etc. From the external environment in which they exist. But no
organization can be a totally closed system. For instance, even a relatively closed system, like
a wind-up alarm clock, requires outside intervention when it slows down or goes out of order.
Thus, a totally closed system is only a theoretical concept. Different systems differ in the
degree to which they depend on the external environment for information, material and
energy inputs.

The two basic characteristics of a closed system are:

It is perfectly deterministic and predictable.

 There is no exchange between the system and the external environment.

If the initial conditions and the stimuli in a closed system are known, the final condition, i.e..
the result can be predicted with certainty. Let us consider the example of a pool table. Prior
knowledge of the following conditions and stimuli make it possible to accurately predict
where each ball will come to rest:

the position of every ball on the table

the elasticity of the bumpers
the coefficient of friction between the balls and the table
the force with which the cue ball is hit
the direction of the cue ball
the type of spin on the cue ball

Classical management theorists borrowed certain ideas from the closed-system concept that
was popular during that period of time. As a result, these theorists emphasized structure and
attempted to eliminate environmental disruptions that could affect their studies of planned
systems activities.

Open System View of Organizations

Traditional closed-system views (like scientific management, the universal process approach,
and bureaucracy) ignored the influence of the external environment. This sometimes led to
the failure of plans and inefficient handling of resources. Unlike the closed-system approach,
the open-system concept stressed the need for flexibility and adaptability in organizational
structure, and the mutual interdependence between the organization and its external
environment. According to this concept, organizations should be adaptive and should take
into consideration the influence of the external environment. According to Andy Groove,
former CEO of Intel Corp, A corporation is a living organism, and it has to continue to shed
its skin.

The modern open-system model of organizing allows an organization to interact with its
environment and evolve its organizational structure gradually over time. Thus, open systems
are based on a biological model rather than a physical one.

Boone and Kurtz define an open system as a set of elements that interact with each other and
the environment, and whose structure evolves over time as a result of interaction.
The open-system concept is based on the assumption that no system is totally deterministic or
predictable because of the uncertainties in the external environment. Here again, let us
consider the example of the pool table. As a player strikes the cue ball, his or her opponent
may pick up a ball from the table. This disturbs the game and it now becomes impossible to
predict where the balls will ultimately come to rest. This is analogous to the influence of the
environment on the system.

An organization is a system consisting of several subsystems which interact with one

another. The organization, in turn, is a subsystem of a larger system social, political,
economic or legal system. System-to-system interactions, like the movement of capital
(example: Corporate borrowings), the movement of goods and services (example:
International trade), and the movement of people in and out of the labour force, are as
important as the systems themselves. .
The Control Function

Introduction

Control is an essential function of management in every organization. The management

process is incomplete and sometimes useless without the control function. The management
process includes planning, organizing, staffing, leading, and controlling. Planning sets forth
the objectives a manager intends to achieve. Organizing provides the structure of an
organization by determining how and where the employees will be placed in the organization
and the responsibilities that they will need to fulfill to attain predefined objectives. Staffing
involves the managerial function of placing the right person in the right job in the
organization. Leading involves the managerial function of influencing, motivating and
directing the human resources of the organization to achieve organizational goals. The
control function is concerned with ensuring that the planning, organizing, staffing and leading
functions result in the attainment of organizational objectives. In other words, control is a tool
that helps organizations measure and compare their actual progress with their established
plan.

The term control has different meanings in different contexts. In the management context,
control refers to the evaluation of performance and the implementation of corrective actions
to accomplish organizational objectives. Some people confuse control with supervision.
Supervision is a part of control; it helps identify deviations from the established standards of
performance.

Importance Of Controlling

The control function is gaining importance in today's organizations due to a number of

factors. These factors include the need for accountability in organizations, the need to detect
environmental changes that significantly affect organizations, the growing complexity of
present day organizations and the need to identify operational errors in organizations to avoid
incurring excessive costs. In addition to addressing the above mentioned factors, controlling
plays an important role in helping managers detect irregularities, identify opportunities,
handle complex situations, decentralize authority, minimize costs, and cope with uncertainty.

Basic Control Process

Even though control systems need to be tailored to suit specific situations, they all involve the
same basic process. When exercising the control function, a manager measures the
performance of an individual, a plan, or a program against certain predetermined standards
and takes corrective action if there are any deviations.

The process involves the following steps:

1. Determining areas to control

2. Establishing standards
3. Measuring performance
4. Comparing performance against standards
5. Recognizing good or positive performance
6. Taking corrective action when necessary
7. Adjusting standards and measures when necessary

Types of Control

Controls Based on Timing

Major Control Types based on Timing

Stages of Production Type of Control Description

Input: Capital, Labor, Raw Feed forward control Inputs are monitored to
materials, Market ensure that they meet the
information, Equipment standards necessary for the
transformation process
Transformation process: Concurrent control Regulates ongoing activities
Planning, Organizing, that are a part of the
Staffing, Leading, transformation process to
Controlling ensure that they conform to
organizational standards
Output: Goods, Services, Feedback control Exercised after a product or
Profits, Waste materials service has been produced to
ensure that the final output
meets quality standards and
goals
Requirements For Effective Controls
 Controls should reflect plans, positions and structures
They should be understandable
They should be cost-effective
Controls should identify only important/major exceptions
Control systems should be flexible
Control systems should provide accurate information
Introduction

One of the most important activities in business is the management of the 4M's men,
machines, material and money. The term management can be interpreted differently in
different contexts. Hence, it is difficult to define. In one context, it may comprise the
activities of executives and administrative personnel in an organization, while in another, it
may refer to a system of getting things done. In a broad perspective, management can be
considered as the proper utilization of people and other resources in an organization to
accomplish desired objectives. With increasing global competition, changes in the world of
technology, changing business practices and increasing social responsibility of
organizations, the role of managers has become all the more significant.

In this chapter, we will first examine the definitions of management given by some eminent
management thinkers to understand the essence of management. Secondly, we will discuss
the five basic functions of management i.e.. planning, organizing, staffing, leading and
controlling. The chapter also focuses on the managerial skills required at various levels of
the organizational hierarchy and briefly explains the various approaches to management.

Definitions Of Management

The term management can be interpreted in a variety of ways. To gain a better insight into
the nature of management, let us look at some of the definitions of management:

Harold Koontz and Heinz Weihrich define management as the process of designing and
maintaining an environment in which individuals, working together in groups, efficiently
accomplish selected aims.

Louis E. Boone and David L. Kurtz define management as the use of people and other
resources to accomplish objectives.

Dalton E. McFarland defines management as a process, by which managers create, direct,

maintain, and operate purposive organizations through systematic, coordinated, cooperative
human effort.

Mary Parker Follet termed management as the act of getting things done through people.

Definitions by Follet and Louis E. Boone and Kurtz call attention to the fact that managers
achieve organizational goals by getting others to do the necessary tasks. The other two
definitions suggest that management is much more than just getting the work done and
suggest the following aspects of management:

1. Managers carry out the functions of planning, organizing, staffing, leading and
controlling: Henry Fayol was the first management thinker to outline the five basic
functions carried out by managers. Every manager performs these basic functions.
These functions are discussed in detail in the later part of this chapter.
2. Management is essential to any kind of organization: Wherever there are groups of
people working together to achieve some common objectives, it becomes essential
to guide, organize and control them. The term management applies to any
organization irrespective of the size or nature of operations. The prime concern of a
CEO of a multinational company, the General Manager of a hotel, the first-level
supervisor, the manager of a cricket team and the student president in a college is to
manage their people and resources effectively.
3. Management is essential at all hierarchical levels: Management is necessary at all
levels. However, the type of skills and the degree to which various skills are
required at different levels of the hierarchy may vary. In order to perform their
duties satisfactorily, managers need technical, human, conceptual and design skills.
4. The goal of all managers is to generate surplus: The aim of all business managers is
to create a surplus. To accomplish this objective, the manager has to create an
environment which encourages people to accomplish as much as possible with the
least amount of resources and personal dissatisfaction. Even in non-profit
organizations, the aim of managers is to accomplish their goals with the minimum
amount of resources or to make as much surplus as possible with available
resources.
5. The aim of all managers is to improve productivity, efficiency and effectiveness:
Productivity is defined as the output-input ratio within a time period with due
consideration for quality. It can be expressed as:

Improving Productivity

Productivity = Outputs/Inputs (within a time period, quality considered)

Productivity can be improved in the following ways:

By producing more output with the same inputs.

 By reducing inputs, but maintaining the same level of outputs.
By increasing outputs and reducing inputs, thereby, making the ratio more
favorable.

Productivity can be improved by ensuring efficiency and effectiveness in the operations

of the firm. Effectiveness refers to achievement of stated organizational objectives
while efficiency denotes the judicious use of resources to achieve organizational
objectives. In the words of Peter Drucker, efficiency means doing things right, while
effectiveness means doing the right things. In his book, Management Tasks,
Responsibilities, Practices, Drucker states that effectiveness is the foundation of
success whereas efficiency is a minimum condition for survival after success has been
achieved
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Evolution of Management

Thought According to one school of thought, history has no relevance to the problems
faced by managers today. Some are also of the opinion that management theory is too
abstract to be of any practical use. However, both theory and history are indispensable
tools for managing contemporary organizations.

Like most modern disciplines, contemporary management thought has its foundations
in the history of management and the many significant contributions of theorists and
practitioners. A theory is a conceptual framework for organizing knowledge that
provides a blueprint for various courses of action. Hence, an awareness and
understanding of important historical developments and theories propounded by early
thinkers is important for today's managers.

In this chapter, we first take a look at the early approaches to management. We then
focus on four well-established schools of management thought (see below):

the classical approach

the behavioral approach
the quantitative approach
the modern approaches to management

Finally, some emerging approaches in management thought are discussed.

Major Classification of Management Approaches and their Contributors

Classical approach

Scientific management: Frederick W. Taylor, Frank and Lillian Gilbreth and

Henry Gantt
Bureaucratic management: Max Weber
Administrative management: Henri Fayol
Behavioral approach

Group influences: Mary Parker Follet

Hawthorne studies: Elton Mayo
Maslow's needs theory: Abraham Maslow
Theory X and Theory Y: Douglas McGregor
Model I versus Model II values: Chris Argyris

Quantitative approach

Management science
Operations management
Management information system

Modern approaches

The Systems Theory

Contingency Theory

Emerging approaches

Theory Z and Quality management: William Ouchi

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Functions Of Managers

The functions of a manager provide a useful framework for organizing management

knowledge under the various heads of planning, organizing, staffing, leading and
controlling. Managerial functions are effective tools for managers to achieve the
organization's planned objectives. They include the general administrative duties that
need to be carried out in virtually all organizations. The management process and
shows the various functions that managers are involved in. It is evident from the figure
that managers are involved in more than one activity at the same time.

Planning

Planning can be defined as the process, by which, managers decide the mission and
objectives of the firm and take necessary steps to achieve the desired objectives. At the
same time, managers need to determine the future trends in business and incorporate
change and innovation into the organization from time to time.

There are various types of plans and they may range from planning to define the
overall purposes and objectives of an organization to planning for a specific action.
Planning helps a firm decide its future course of action.

Organizing

Organizing is the process of assigning tasks and allocating resources to individuals to

enable them to accomplish organizational goals. Organizing is a continuous process of
determining

1. Which tasks are to be performed

2. how tasks can best be combined into specific jobs
3. how jobs can be grouped into various units
4. the authority and reporting relationships within the corporate hierarchy The
organizational structure of a firm is a key element in determining its success or
failure. If plans are not organized properly even the best of plans can fail. On the other
hand, the pitfalls associated with a poor plan can be eliminated by excellent
organization.
Staffing

Today, staffing is better known as human resource management and involves manning or
filling the various positions in the organizational hierarchy. Activities like determining
manpower requirements, assessing the number of people presently available in the
organization, recruiting and selecting candidates, training and placing them in the
organization come under the purview of staffing. This function also deals with compensation,
performance appraisal, promotion and career planning.

Leading

Leading is defined as the management function of influencing, motivating, and directing

people towards the achievement of organizational goals. It is the management function that
involves influencing and inspiring team members to perform well and accomplish corporate
objectives.

Leading involves

communicating with others

leadership styles and approaches
motivating people to put forth the effort required to achieve organizational goals. In
simple words, it is the act of making things happens through others.

Controlling

The final step in the management process is to monitor the progress of an organization
towards its goals. Controlling can be defined as the continuous measurement and analysis of
actual operations against the established industry standards developed during the planning
process and corrections of deviations, if any.

The basic control process involves

comparing performance with standards

determining where negative deviations occur
developing remedial measures to correct deviations.
Labour Laws

As per workmen's compensation act-1923 what are the privileges and benefits those are
included in wage, also state employer's obligation and rights towards employees.

The following are the privileges and benefits included in the wages:

Free accommodation
Maternity benefit payable to women delivering a child
Dearness allowances
Overtime allowance
Overtime pay
Benefits in the form of food or clothing
Value of any other concessions, benefits or privileges capable of being estimated in
money
Gratuity payable to a workman on retirement
Bonus earned in the date of accidents
Employer's obligations and rights towards employees:
The obligation and rights of employers and employees under the workmen's
compensation act given below

Section 3: Employer's liability for compensation

If personal injury is caused to a workman by accident arising out of and. In the course of his
employment, his. Employer shall be liable to pay compensation in accordance with the
provisions of this Chapter: Provided that the employer shall not be so liable-

in respect of any injury which does not result in the total or partial disablement of
the workman for a period exceeding three days
in respect of any injury, hot resulting in death or permanent total disablement caused
by an accident which is directly attributable to
1. the workman having been at the time thereof under the influence of drink or drugs,
or the wilful disobedience of the workman to an order expressly given, or to a rule
expressly framed, for the purpose of securing the safety of workmen, or
2. the wilful removal or disregard by the workman of any safety guard or other device
which he knew to have been provided for the purpose of securing the safety of
 workmen Provided that if it is proved. that a workman whilst in the service of one or
more employers in any employment specified in Part C of Schedule III has
contracted a disease specified therein as an occupational disease peculiar to that
employment during a continuous period which is less than the period specified under
this sub-section for that employment, and

Provided further that if it is proved

that a workman who having served under any employer in any employment
specified in Part B of Schedule III or who having served under one or more
employers in any employment specified in Part C of that Schedule, for a
continuous period specified under this subsection for that employment and he
has after the cessation of such service contracted any disease specified in the
said Part B or the said Part C, as the case may be, as an occupational disease
peculiar to the employment and that such disease arose out of the employment,
the contracting of the disease shall be deemed to be an injury by accident within
the meaning of this section.
Save as provided by 37 sub-sections (2) (2A), and (3), no compensation shall be
payable to a workman in respect of any disease unless the disease is 38 * * *
directly attributable to a specific injury by accident arising out of and in the
course of his employment. Nothing herein contained shall be deemed to confer
any right to compensation on a workman in respect of any injury if he has
instituted in a Civil Court a suit for damages in respect of the injury against the
employer or any other person; and no suit for damages shall be maintainable by
a workman in any Court of law in respect of any injury if he has instituted a
claim to compensation in respect of the injury before a Commissioner; or if an
agreement has been come to between the workman and his employer providing
for the payment of compensation in respect of the injury in accordance with the
provisions of this Act.

Section 4: Amount of compensation

1. Subject to the provisions of this Act, the amount of compensation shall be as

follows, namely: Where death results from the injury an amount equal fifty per
cent of the monthly wages of the deceased workman multiplied by the relevant
factor; or an amount of 39b eighty thousand rupees, whichever is more
2. where permanent total dis-an amount equal to sixty per cent ablement results
from the in-of the monthly wages of the injured jury workman multiplied by the
relevant factor; or an amount of ninety thousand rupees, whichever is more.
Explanation I: For the purposes of clause a and clause b, relevant factor in
relation to a workman means the factor specified in the second column of
Schedule IV against the entry in the first column of that Schedule specifying the
number of years which are the same as the completed years of the age of the
workman on his last birthday immediately preceding the date on which the
compensation fell due; Explanation II: Where the monthly wages of a workman
exceed 39e four thousand rupees, his monthly wages for the purposes of clause a
and clause b shall be deemed to be 39e four thousand rupees only
3. where permanent partial dis-ablement results from the injury
in the case of an injury specified in Part II of Schedule I, such percentage of the
compensation which would have been payable in the case of permanent total
disablement as is specified therein as being the percentage of the loss of earning
capacity caused by that injury, and Explanation I: Where more injuries than one
are caused by the same accident, the amount of compensation payable under
this head shall be aggregated but not so in any case as to exceed the amount
which would have been payable if permanent total disablement had resulted
from the injuries; Explanation II: In assessing the loss of earning capacity for
the purposes of sub-clause
the qualified medical practitioner shall have due regard to the percentages of
loss of earning capacity in relation to different injuries specified in Schedule I

4. Where temporary disablement, whether total or partial, results from the injury a
half monthly payment of the sum equivalent to twenty-five per cent of monthly
wages of the workman, to be paid in accordance with. The provisions of sub-
section (2).

a. Notwithstanding anything contained in sub-section (1), while fixing the

amount of compensation payable to a workman in respect of an accident
occurred outside India, the Commissioner shall take into account the
amount of compensation, if any, awarded to such workman in accordance
with the law of the country in which the accident occurred and shall reduce
 the amount fixed by him by the amount of compensation awarded to the
workman in accordance with the law of that country.
b. The half-monthly payment referred to in clause a of sub-section (1) shall be
payable on the sixteenth day
i. from the date of disablement where such disablement lasts for a period of twenty-
eight days or more, or
ii. after the expiry of a waiting period of three days from the date of disablement where
such disablement lasts for a period of less than twenty-eight days; and thereafter half-
monthly during the disablement or during a period of five years, whichever period is
shorter:
Leadership

Introduction

The success or failure of managers depends on their leadership qualities. They can be
successful leaders by helping subordinates to find solutions to their problems. Managers are
involved with bringing together resources, developing strategies, organizing and controlling
activities in order to achieve objectives. At the same time managers, as leaders, have to select
the goals and objectives of an organization, decide what is to be done and motivate people to
do it. Thus, leadership is that function of management which is largely involved with
establishing goals and motivating people to help achieve them. Leaders set goals and help
subordinates find the right path to achieve these goals.

A person may be an effective manager-a good planner, and an organized administrator-but

lack the motivational skills of a leader. Another may be an effective leader-skilled at
inspiring enthusiasm and devotion-but lack the managerial skills to channel the energy he/she
arouses in others. Given the challenges of dynamic engagement in today's business world,
most organizations today are putting a premium on managers who also possess leadership
skills.

Definition and Meaning Of Leadership

Leadership is the use of non-coercive influence to shape the group or organization's goals,
and motivate behaviour towards the achievement of those goals.

It is a process in which one individual exerts influence over others.

Leadership involves other people-employees or followers-who by the degree of their

willingness to accept direction, help to define the leader's status.

It involves authority and responsibility, in terms of deciding the way ahead and being held
responsible for the success or failure in achieving the agreed objectives.

Leadership involves an unequal distribution of power between leaders and group members.
Group members are not powerless; they can and do shape group activities in a number of
ways. Still, the leader will usually have more power.
Key Elements Of Leadership

It has been observed that every group that attains its goals or performs efficiently has a
skilled leader. A leader's skill comprises of four major elements: (1) the ability to use power
effectively and in a responsible manner (2), the ability to understand the fact that people are
motivated by different forces at different times and in different situations (3), the ability to
inspire and (4) the ability to behave in a manner that will develop a harmonious work culture.

Leadership Theories

Trait Theory of Leadership According to this theory, leaders are born, not made. Many
researchers have tried to identify the physical, mental, and personality traits of various
leaders. Leaders do not possess all the traits mentioned in these theories, whereas many non-
leaders possess many of them. Moreover, the trait approach does not give one an estimate of
how much of any given trait a person should possess. Different studies do not agree about
which traits are leadership traits, or how they are related to leadership behavior. Most of these
traits are really patterns of behavior.

Behavioral Theories

When it became evident that effective leaders did not seem to have a particular set of
distinguishing traits, researchers tried to study the behavioral aspects of effective leaders. In
other words, rather than try to figure out who effective leaders are, researchers tried to
determine what effective leaders do-how they delegate tasks, how they communicate with
and try to motivate their followers or employees, how they carry out their tasks, and so on:

Situational or Contingency Theories

The use of the trait and behavioral approaches to leadership showed that effective leadership
depended on many variables, such as organizational culture and the nature of tasks. No one
trait was common to all effective leaders. No one style was effective in all situations.
Researchers, therefore, began trying to identify those factors in each situation that influenced
the effectiveness of a particular leadership style. They started looking at and studying
different situations in the belief that leaders are the products of given situations. A large
number of studies have been made on the premise that leadership is strongly affected by the
situations in which the leader emerges, and in which he or she operates. Taken together, the
theories resulting from this type of study constitute the contingency approach to leadership.
Situational or contingency approaches obviously are of great relevance to managerial theory
and practice. They are important for practicing managers, who must consider the situation
when they design an environment for performance. There are four popular situational theories
of leadership: (1) Fiedler's contingency approach to leadership (2) The path-goal theory (3),
The Vroom-Yetton model and (4) Hersey and Blanchard's situational leadership model.

The contingency theories focus on the following factors.

1. Task requirements
2. Peers'expectations and behaviour
3. Organizational culture and policies

Path-goal theory

This theory was developed largely by Robert J. House and Terence R. Mitchell. The path-
goal theory of leadership attempts to explain how a leader can help his subordinates to
accomplish the goals of the organization by indicating the best path and removing obstacles
to the goals.

The path-goal theory indicates that effective leadership is dependent on, firstly, clearly
defining, for subordinates, the paths to goal attainment; and, secondly, the degree to which
the leader is able to improve the chances that the subordinates will achieve their goals. In
other words, the path-goal theory suggests that the leaders should set clear and specific goals
for subordinates. They should help the subordinates find the best way of doing things and
remove the impediments that hinder them from realizing the set goals