QUESTION 1
a). State and explain any ten (10) principles of management from one of the management theories. (20 marks)
b). Name and explain any five challenges management face in running businesses in the 21st century. (5 marks)
a). Henri Fayol, a French mining engineer, developed a general theory of business administration and is one of the most influential contributors to modern concepts of management. Fayol’s principles of management are widely accepted and are discussed below:
1. **Division of Work**: Specialization allows individuals to build up experience, and improve their skills. It leads to efficiency and productivity since workers are able to become proficient at a particular task.
2. **Authority and Responsibility**: Authority is the right to give orders and the power to exact obedience, while responsibility is a corollary of authority, meaning that managers must be held accountable for their actions.
3. **Discipline**: Discipline within an organization is essential for smooth operations. It relies upon good leadership, clear and fair agreements, and judicious use of penalties.
4. **Unity of Command**: Each employee should receive orders from only one superior. This reduces potential confusion and conflict arising from receiving conflicting orders from different managers.
5. **Unity of Direction**: Teams with the same objective should be working under the direction of one manager, using one plan. This will ensure that action is coordinated with consistent aims.
6. **Subordination of Individual Interests to the General Interest**: The interests of any one employee or group of employees should not take precedence over the interests of the organization as a whole.
7. **Remuneration**: Workers must be paid a fair wage for their services. This is crucial for their satisfaction and motivation.
8. **Centralization**: Refers to the degree to which decision-making is concentrated at a single point in the organization. It must be balanced with an appropriate amount of decentralization depending on the circumstances and the business environment.
9. **Scalar Chain**: The line of authority from top management to the lowest ranks represents the scalar chain. Communications should follow this chain. However, if following the chain creates delays, cross-communication should be allowed if agreed upon by all parties.
10. **Order**: There should be an appointed place for every employee and every employee should be in their appointed place. This principle is concerned with the organized arrangement of materials, people, and systems within the organization.
b). Five challenges management face in running businesses in the 21st century include:
1. **Globalization**: The expansion of markets and competition from around the world means managers must deal with a variety of cultural, economic, and political environments. Adjusting strategies to compete on a global scale can be complex.
2. **Technological Change**: Advancements in technology can rapidly make products or processes obsolete. Managers need to continuously innovate and adapt their business practices to survive and thrive.
3. **Sustainability**: Environmental and social responsibility are becoming more important to consumers and stakeholders. Managers must find ways to reduce the environmental impact, embrace ethical practices, and maintain profitability.
4. **Workforce Diversity**: With a diverse workforce in terms of culture, gender, and age, it is a challenge for management to handle different expectations and establish a harmonious work environment.
5. **Rapid Pace of Change**: The acceleration of change in markets and consumer preferences requires agility in decision-making and flexibility in organizational processes. Keeping pace with these changes while maintaining a coherent business strategy is a significant challenge.