Understanding Management: Organizations, Resources, and Systems
Understanding Management
Why Study Management?
Management plays a crucial role in today’s society.
- For those aspiring to administrative or managerial positions, management provides the knowledge to be more effective.
- For those not in administrative roles, it offers insight into how organizations function and how leaders behave.
The Concept of Organization
What is an Organization?
An organization is a systematic agreement between people to achieve a specific purpose, such as colleges, universities, churches, or businesses.
Common Characteristics of Organizations:
- Each organization has a distinct purpose.
- Each organization is composed of individuals.
- All organizations develop a systemic structure that defines and limits the conduct of its members (e.g., rules, regulations, fees).
Administration in Organizations
The Company
A company is an agency or institution whose main objective is to produce goods and/or provide services that meet the needs of a community.
Managing Resources
A company must manage different types of resources:
- Materials
- Human Resources
- Financial Resources
- Technical Resources
- Marketing Resources
The Role of Management
The role of management is to help companies achieve their goals by optimizing resources, focusing on both effectiveness and efficiency.
The Company as an Economic Entity
A company exists to meet the needs of individuals and communities. These needs are satisfied with goods, which typically require resources subject to a production process.
Due to the scarcity of resources and diverse needs, companies must operate effectively and efficiently. A company is part of an environment that aims to produce essential goods and services more effectively and efficiently than its competitors.
Effective management leads to rewards (profit), while failure results in penalties (loss). Continuous failure can lead to bankruptcy.
The social function of a company is to satisfy the real needs of consumers and provide a stable source of work and satisfaction for its employees, contributing to a better quality of life.
The Company as an Open System
An open system consists of interrelated elements or subsystems coordinated to achieve an overall goal.
Systems Approach
The systems approach is a general theory applicable beyond administrative science. A system is a set of interrelated elements working together to achieve a common purpose.
Characteristics of open systems include synergy and recursion.
Elements of an Open System:
- Input current
- Transformation process
- Output current
- Feedback
Organization as a Unified System
The organization is conceived as a unified and directed system with interrelated parts.
A system is viable if the output currents allow feedback to ensure its survival. Insufficient output for self-generation signals infeasibility.