Question

Why have the 'Principle of Management' gained importance these days?

Answer 1

• Provides insights : Management principles play a key role in providing insights to facilitate efficient decision making. These principles adds to their knowledge and ability to deal with various situations and also helps in handling recurring contemplated problems. Thus it plays a role in increasing managerial efficiency.
• Optimal Utilization of Resources : Resources are the life blood of a business. Its optimal usage is a sine qua non for the success of a business. Management principles helps in ensuring optimal usage by laying down broad frameworks on how to use these resources and how not to. This when applied in proper situations can make for efficient resource decisions. These principles are also applicable to resource collection or organisation, so as to prevent wasteful accumulation of scarce resources.
• Effective Administration : Administration of a business is a part and parcel of management. Principles of Management plays a key role in administering the business by helping in the regulation of the human resources among each other and also by prescribing norms of relations. These norms when followed leads to established beneficial results. For example, decentralization as a principle helps in administration by giving adequate power to many units across the business to ensure compliance and efficiency.
• Scientific Decisions : The decisions made by following these principles are scientific decisions. It is scientific in the sense that it is made with due regard to logic, reason and facts and it is rational. Rational decisions always ensures efficiency within a business and helps in its success.
• Adapting to Changes : Management principles as already mentioned are general guidelines which is to be applied differently in different situations. Different management principles are contemplated for different situations. So when a situation changes, a different management principle apt to the new situation thereby allows adapting to changes.
• Fulfilling Social Responsibility : Management principles plays a vital role in fulfilling the responsibility the business owes to the society. Businesses being social entities have social responsibilities for the benefits they derive from the society. Management principles such as ensuring optimal resources etc makes sure that the business does not bring harm to the society and also that it benefits the society.
• Basis of Management Studies : Management principles lie at the base of management education. All the knowledge imparted to the students of management are derived from management principles. This understanding conferred by virtue of being based on management principles helps in developing managerial talent.