Your Guide to The Functions of Management

By Indeed Editorial Team

Updated 28 August 2022 | Published 2 August 2021

Updated 28 August 2022

Published 2 August 2021

The Indeed Editorial Team comprises a diverse and talented team of writers, researchers and subject matter experts equipped with Indeed's data and insights to deliver useful tips to help guide your career journey.

Organisations, regardless of business model or industry, depend on capable managers to achieve goals, earn profits and maintain consistent operations. Professionals in leadership positions who have a firm grasp on the functions of management can better fulfil their responsibilities and deliver great results for their employers. If you aspire to succeed in a managerial position, you might benefit from reviewing what a company might expect of you. In this article, we define the five functions of management and explore each one.

Related: Management Skills: Definition and Examples

What Are Functions Of Management?

Functions of management are the general categories of responsibilities professionals in oversight roles perform. They condense many specific tasks and duties into simplified groups so organisations can efficiently delegate responsibilities and analyse distinct issues separately. For instance, a company might recognise that it needs to improve how it manages hiring and training. Rather than review all of its managers' performances, it would assess those who perform the management function of staffing.

5 Management Functions

Many organisations divide management into five key functions that cover a wide range of duties. Although distinct from one another, each function interacts with the others and affects a company's overall success. These five functions are:

1. Planning

In the planning stage, managers establish organisational goals and create a course of action to achieve them. During the planning phase, management makes strategic decisions to set a direction for the organisation. Managers can brainstorm different alternatives to achieve the objective before choosing the best course of action. While planning, managers typically conduct an in-depth analysis of the organisation's current state of affairs, taking into consideration its vision and mission and evaluating what resources are available to meet its objectives.

While planning, managers usually evaluate internal and external factors that may affect the execution of the plan, such as economic growth, customers and competitors. They also establish a realistic timeline for achieving goals based on the organisation's available finances, personnel and resources. Managers may have to take additional steps, such as seeking approval from other departments, executives or their board of directors before proceeding with the plan. Approaches to planning include:

  • Strategic planning: Strategic planning usually creates goals for the entire organisation. It analyses threats to the organisation, evaluates the organisation's strengths and weaknesses and creates a plan of how the organisation can best compete in its environment. Strategic planning usually has a long timeframe of three years or more.

  • Tactical planning: Tactical planning is the shorter-term planning of an objective that takes a year or less to achieve. Organisations usually use tactical planning to improve a department or area such as its facilities, production, finance, marketing or personnel.

  • Operational planning: Operational planning links strategic and tactical goals, specifying the daily actions that can achieve them. Operational planning also creates a timeframe for putting each portion of the strategic goal into practice.

Related: 19 Essential Project Management Skills To Master

2. Staffing

Management determines the staffing needs of the organisation, deciding how large of a team is necessary to maximise productivity and work quality. Aside from calculating how many employees to hire, managers build candidate profiles for each position, specifying the qualifications they would like an applicant to have. Staffing is critical when beginning a business, but it remains an equally important function throughout a company's lifecycle. As employees change roles or leave, staffing needs evolve, requiring constant attention. The key staffing functions are:

  • Recruiting: Managers use various channels to advertise openings and find suitable candidates. They might post online, rely on professional networks for referrals or use a recruitment service to locate the best talent.

  • Interviewing: Managers use the interview process to learn more about compelling applicants. Interviews enable organisations to confirm someone would work well with their team and contribute positively.

  • Hiring: Managers ensure employees join the organisation legally, collecting required documents and completing necessary paperwork.

  • Training: Managers develop onboarding routines that introduce new hires to the company and provide them with the training they need. They also train established employees to further develop their skills or teach them new ones.

  • Evaluating: Managers monitor individual employees' performance to evaluate their future potential. They typically decide whether to promote or reassign employees who offer value and determine which employees do not fit with the company.

Related: How To Develop Effective People Management Skills

3. Organising

Organising is the process of structuring an enterprise and dividing its resources to accomplish goals efficiently. Managers need to have a comprehensive knowledge of the materials, personnel and budgets available to them so they can create optimally productive systems and relationships. For instance, managers decide how to structure departments or pair employees who work well together on assignments. Organising often focuses on preserving accountability, ensuring each member of a team understands their duties and reports their progress correctly.

When companies are well-organised, employees can collaborate productively and access all the information and resources they need to complete their jobs. When problems occur or questions arise, team members know who to seek help from and can do so quickly. Here are the major responsibilities that fall under the organising function:

  • Delegation: Management defines roles in an organisation, specifying responsibilities for each position. It also establishes individual employees' day-to-day priorities, which regularly change.

  • Department structuring: Management decides which departments their organisation would benefit from having or makes adjustments to existing ones. Sometimes, managers combine or break up departments to meet better focus on specific objectives.

  • Distributing authority: Management establishes the reporting structures that organisations depend on for accurate communication and efficient oversight. It also grants different degrees of authority for each level of management, enabling employees in some positions to make key decisions or enforce standards.

4. Leading

Leading consists of motivating employees and influencing their behaviour to achieve organisational objectives. Usually, leading focuses on managing people, such as individuals and teams, rather than tasks. Though managers direct team members by giving orders and assigning duties, successful leaders connect with their employees by using interpersonal skills to encourage, inspire and motivate team members.

Managers can foster a positive working environment by identifying moments when employees need support or direction and using positive reinforcement when employees have done their jobs well. They usually incorporate different leadership and management styles to adapt to different situations. Examples of situational leadership styles include:

  • Directing: The manager leads by making decisions with little input from the employee. This is an effective leadership style for new employees who need a lot of initial direction and training.

  • Coaching: The manager is more receptive to input from employees, sharing ideas with them to receive feedback and build trust. This style of leadership is effective for individuals who need managerial support to further develop their skills.

  • Supporting: The manager makes decisions in collaboration with employees but primarily focuses on building relationships within the team. This style of leadership is effective for employees who have fully developed skills but are sometimes inconsistent in their performance.

  • Delegating: The leader provides a minimum level of guidance to employees and is more concerned with the long-term vision of the project than day-to-day operations. This style of leadership is effective with employees able to work and perform tasks independently, enabling the leader to focus on overarching goals instead of individual tasks.

5. Controlling

Controlling is how managers respond to feedback, analysing the outcomes of their initial plans to determine necessary adjustments. Since plans rarely unfold exactly as intended, controlling is a critical function that ensures an organisation can adapt as circumstances change and new challenges appear. Managers control all aspects of operations, including employee performance, policies, task delegation and marketing. Since each of these activities produces feedback, managers receive a constant flow of information they can assess. Managers act on feedback by:

  • Conducting performance reviews: Managers consider key performance indicators that summarise how well an employee is completing their job. They meet with team members to identify where they need to improve and offer advice on how to do so.

  • Reducing inefficiencies: Managers review production processes and workflows to locate inefficiencies. They revise procedures and systems to reduce or eliminate them wherever possible, saving time and money.

  • Adjusting budgets: Managers confirm budgets are in line with initial spending estimates. Where they find significant differences, they make adjustments by cutting spending or raising more capital.

  • Developing improved products: Managers collect feedback from consumers to determine how their products could better meet customers' needs. The improvements they make help them remain competitive in their market and earn their audience's loyalty.

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