Management

Management (Russian: upravlenie):

• an element and function of organized systems of various kinds — biological, social, and technical — that ensures the preservation of their specific structure, the maintenance of their mode of activity, and the realization of their program and goals;

• an influence exerted on a controlled system in order to ensure its required behavior;
• a process of organizing the activity of a managed object by a managing subject in order to achieve stated goals;
• an action taken by a subject, directed at itself or at external objects or subjects, with the aim of transforming them or altering their properties.

Management:

• as a process — the set of managerial actions that ensure the achievement of stated goals by transforming resources at the "input" into products at the "output";
• as a science — a body of organized knowledge in the form of concepts, theories, principles, methods, and forms of management;
• as a function — purposeful informational influence on people and economic entities, carried out in order to direct their actions and obtain desired results;
• as an apparatus — the set of structures and people that ensure the use and coordination of all resources of social systems in pursuit of their goals.

There are also many other definitions, according to which management is described as an element, a function, an influence, a process, a result, a choice, and so on. When performed by a subject, management should be viewed as managerial activity. This perspective explains its multifaceted nature and reconciles the various approaches to the concept.

If management is performed by a governing body, then performing that activity is a function of the governing system; the management process matches the process of (managerial) activity, and the control action matches its result. When both the governing body and the controlled system are subjects, management involves organizing the activities of the governed subjects.

Managerial activity, as one form of professional practical activity, possesses a number of general characteristics. Among them are: the uniqueness and unpredictability of human activity under specific conditions (including constraints of limited capabilities and resources), the ability to adapt to changing conditions, the capacity for goal-setting, and the capacity for self-organization and development. In addition, managerial activity is characterized by several distinctive features:

1. Subjectivity of managerial activity. Managerial activity is fundamentally subjective. Any activity is subjective, since it is always carried out by some subject. However, in managerial activity, managers' personal qualities, professional experience, and ethical stance are particularly significant.
2. Autonomous goal-setting by the managing subject is an integral feature of managerial activity. As a rule, the manager independently formulates not only the goal of their own activity, but also the goal of the managed system's activity, decomposes these into tasks, and devises ways of achieving them. In some cases, however, the manager merely conveys goals formulated at a higher level of the system.
3. Indirectness of results. The immediate result of managerial activity is the control action exerted on the managed system. But this action is not an end in itself — it is undertaken to ensure the required behavior of the managed system. The subject matter of managerial activity is the activity of the managed system. In other words, the ultimate (indirect) result of managerial activity is the state (the outcome) of the managed system. It is precisely by this result that the effectiveness of management is assessed.
4. Creative character of managerial activity. Management is essentially decision-making. The decision-making process cannot be fully formalized. It always involves uncertain factors and creativity. However, creativity is constrained by legal, ethical, and other norms, as well as by resource and other limitations.
5. The need for modeling, prediction, and forecasting of the managed system's behavior in response to control actions.
6. Responsibility of the managing subject for the process and outcomes of their own activity and of the subjects and/or objects they manage. The managing subject bears responsibility not only for the immediate results of their own activity but also for its indirect result — the state of the managed system and the outcomes of its activity.
7. Development and adaptation. A distinctive feature of managerial activity is the need for the development of both the managing subject and the managed system, as well as their adaptation to changing external and internal conditions.

To describe the functioning of organizational management systems, the concept of a management cycle is used — that is, a model describing the management process as a repeated sequence of standard stages. To date, several dozen models of the management cycle have been proposed, for example:

• Henri Fayol's cycle: Planning – Organizing – Motivating – Controlling;
• W. Edwards Deming's PDCA cycle: Plan – Do – Check – Act;
• the cycle of Information Gathering – Planning – Implementation – Accounting – Control – Analysis – Adjustment.

At the heart of any managerial activity lies the idea of a continuous management cycle that makes pervasive use of metrics and indicators (for "description and measurement") and quantitative models. The primary focus is on methods, tools, and decisions aimed at improving the quantitatively expressed performance of an activity. All components of a performance management system are represented in the management cycle models through a system of specific quantitative descriptions, indicators, and models.

The systems approach analyzes objects and management structures from the general to the particular. It proposes that organizations be viewed as systems of elements, for which goals and tasks must be set to ensure optimal development.

Key elements of the systems approach to management:

• solving any problem begins with a clear formulation of goals;
• any problem or task should be viewed as a goal tree, relating each individual decision to the ultimate goals;
• when determining ways to achieve goals, alternative options must be considered;
• the goals of individual subsystems must not contradict the ultimate goals of the system as a whole.

From the standpoint of the systems approach, management is a complex process with two distinct layers: operational control (regulation) and strategic direction. The task of operational control is to maintain certain parameters of the system at a given level. Strategic direction consists of determining precisely what that given state of the system should be. Strategic direction encompasses design and planning, while operational control encompasses day-to-day supervision and all functions associated with it.

To study the functioning of a complex stochastic system, it is useful to represent it as a controlling subsystem and a controlled subsystem. Having set the parameters of the controlled subsystem, the controlling subsystem must maintain them at the specified level based on the principle of feedback.

Feedback-based regulation ensures the compensation not only of disturbances of a particular kind, but of any disturbances whatsoever. In this way, the influence of disturbances on the system is compensated even when their cause is, in general, unknown. This is especially important when dealing with highly complex systems that resist detailed description.

Systems analysis defines a system as a set of components united to achieve a strategic goal. This leads to a goal or task that the system was created to accomplish. Since this goal is strategic, the system must also solve many tactical tasks to pursue it.

It is quite understandable that some managers wish to concentrate their efforts on individual, particular issues. They try to broaden the scope of these particulars while leaving the task of integrating results from numerous divisions to others, even though the problem of management integration is central to them. The essence of leadership lies in coordination, and it is clear that a process of synthesis like the one described can be useful to managers at every level. When managers focus on individual specialized areas, they risk losing sight of the overall goals of their enterprises and their role within larger systems. If they maintain a clear picture of the "big picture," they will be able to carry out their responsibilities more effectively.

Ignoring the overall systems approach may be deliberate — because heads of departments or functional units tend to overestimate the significance of their own actions for the results of the whole enterprise. Sometimes such neglect is unintentional, arising from a decision-maker's inability to foresee the consequences of their decisions for other areas of the enterprise's activity. The central point of applying the systems approach to management is to obtain a clear picture of the network of subsystems and interconnected parts that form a unified whole.

The ideas of the systems approach are inconceivable without a clear understanding of what a system is. A system is an integral complex of dynamically interconnected elements. A system can only be considered in unity with its environment. As a rule, any system is an element of a higher-order system, and any element of a system can in turn be viewed as a lower-order system.

The integrity of a system and the interconnection of its elements are determined solely in relation to the system's goal. At the same time, a system must not be equated with a real-world object, since any object can be examined from different perspectives, and depending on the perspective chosen, many different systems can be identified, each reflecting one aspect of the object's functioning. Studying the operation of complex systems by examining individual elements alone is impossible, because complex systems possess the property of emergence — the ability of a system to exhibit properties that are not inherent in any of its individual elements.

The use of the systems approach and systems theory made it possible to see organizations and all management hierarchies as unities of their constituent parts, as well as within the global system of the external world. At the same time, it became possible to integrate the ideas and approaches of other schools that had dominated management practice and theory at different times. The systems approach brought into management theory the methods and achievements of the exact sciences, engineering, natural sciences, and the humanities.

However, the most important contribution of the systems approach to management theory was the formation of a new way of thinking. The systems approach enabled managers to determine the place of the organization they lead within the external world, to understand that any management structure is an open system, and consequently, that managing an organization cannot be built as if for a closed system — that is, without taking into account the influence of the external environment on internal management processes. Only with the advent of the systems approach did the environment come to be regarded as a fundamental variable in management.

An important outcome of applying the systems approach to management theory and practice is the integration of the ideas and achievements of different schools of management. For this, it was sufficient to treat them not as separate systems but as subsystems within management theory. This immediately revealed the limitations of each approach and the possibilities for their use — especially since each school of management had concentrated its efforts on just one facet (subsystem) of organizations: people, structures, management methods, and so on. The behaviorist school investigated the social domain of management. The schools of scientific management and quantitative methods studied primarily the management of technical systems. Only the systems approach made it possible to unite all the components of organizations into a coherent whole.

The systems approach made it possible to represent an organization as an open system whose "inputs" are human, material, financial, and information resources, which — depending on the algorithms, approaches, methods, tools, and technologies of management — are transformed into "outputs" in the form of achieved goals and organizational outcomes (profit, increased output and product quality, improved performance indicators, material incentives, higher labor productivity, and so on).