CPA Advanced LevelLeadership and Management
Chapters
Chapter 1

Part A: Management foundations

Introduction to management

Last updated November 20268 sectionsabout 6 min read

Key takeaways

  • Management is planning, organising, staffing, leading and controlling an organisation's resources to achieve defined objectives efficiently and effectively; it is both a science and an art.
  • Top management sets strategy and direction, middle management turns strategy into departmental plans, and first-line management supervises day-to-day operational work.
  • Mintzberg's ten roles describe what managers actually do: interpersonal (figurehead, leader, liaison), informational (monitor, disseminator, spokesperson) and decisional (entrepreneur, disturbance handler, resource allocator, negotiator).
  • Katz: technical skill matters most at supervisory level, conceptual skill matters most at the top, and human skill matters roughly equally at every level.
  • Management focuses on execution, getting things done through people; administration focuses on policy and overall direction, though the two overlap at senior levels.

Nature of management

Management is the process of planning, organising, staffing, leading and controlling an organisation's resources to achieve defined objectives efficiently and effectively, both a science (systematic principles) and an art (judgement in applying them).

Why management matters

  • Coordinates diverse resources toward common goals
  • Improves efficiency and reduces waste
  • Adapts the organisation to a changing environment
  • Provides direction and motivation for people

Levels of management

Top management
Sets overall strategy and direction (e.g. board, CEO).
Middle management
Translates strategy into departmental plans, coordinates between top and operational levels.
Lower (operational/first-line) management
Directly supervises day-to-day operational work.

A multi-disciplinary field

Management draws on economics, psychology, sociology, mathematics and law, among other disciplines, since managing people, resources and decisions genuinely requires insight from all of them rather than one narrow technical field.

Mintzberg's managerial roles

Interpersonal roles
Figurehead, leader, liaison.
Informational roles
Monitor, disseminator, spokesperson.
Decisional roles
Entrepreneur, disturbance handler, resource allocator, negotiator.

Mintzberg's contribution was empirical rather than theoretical, and that is the point worth making in an answer. He watched what managers actually did and found that it bore little resemblance to the orderly planning, organising and controlling the classical writers described. Managers:

  • Worked in short, fragmented bursts
  • Were constantly interrupted
  • Preferred verbal to written communication
  • Spent most of their time reacting rather than planning

The ten roles he identified are therefore a description of real work, grouped as interpersonal, informational and decisional.

The ten roles fall into three groups:

  • The interpersonal roles: figurehead, leader and liaison; they come from the manager's formal authority.
  • The informational roles: monitor, disseminator and spokesperson; they come from the manager's position at the centre of information flows.
  • The decisional roles: entrepreneur, disturbance handler, resource allocator and negotiator; they depend on the information gathered in the second group.

The dependency runs in that order, which is why a manager cut off from information cannot decide well however much authority they hold.

How the manager's role is changing

Modern management has shifted from purely directive, hierarchical control toward more facilitative, collaborative styles, driven by flatter organisational structures, remote/hybrid work, and employees expecting greater autonomy and purpose.

Qualities of an effective manager

  • Strong communication skills
  • Sound decision-making judgement
  • Emotional intelligence and empathy
  • Adaptability to change
  • Technical and industry competence

Katz's three skills explain how the manager's job changes with level, and the change is examinable. Technical skill, the ability to use specific methods and equipment, matters most at supervisory level and least at the top. Conceptual skill, the ability to see the organisation as a whole and how its parts depend on each other, matters most at the top. Human skill, the ability to work with and through people, matters roughly equally at every level. A good technician promoted into a senior post fails most often because the job has moved from the first skill to the second and the person has not.

Management and administration

Management
Focuses on execution, getting things done through people, more operationally oriented.
Administration
Focuses on setting policy and overall direction, more strategically oriented, though in practice the two overlap significantly at senior levels.

Exam tip

Mintzberg's ten managerial roles (grouped into interpersonal, informational, decisional) is a frequently named-and-tested framework, be ready to classify a described managerial activity into the correct one of the ten specific roles, not just the broader category.

Self-check

(a) A branch manager represents the bank at a community fundraiser as its formal representative. Identify the specific Mintzberg role and its broader category. (2 marks)

(b) List the three levels of management, with the primary focus of each. (6 marks)

(c) Distinguish management from administration. (3 marks)

(d) State two qualities of an effective manager. (2 marks)

Show worked answer

(a) Figurehead, an interpersonal role (2 marks).

(b) Top management: sets overall strategy and direction. Middle management: translates strategy into departmental plans, coordinating between top and operational levels. Lower (operational/first-line) management: directly supervises day-to-day operational work (6 marks).

(c) Management focuses on execution, getting things done through people, more operationally oriented; administration focuses on setting policy and overall direction, more strategically oriented, though the two overlap significantly at senior levels (3 marks).

(d) Any two of: strong communication skills; sound decision-making judgement; emotional intelligence and empathy; adaptability to change; technical and industry competence (2 marks).

Test Your Knowledge

3 questions on this chapter
Question 1 of 3The managing director of a Mombasa logistics firm spends the afternoon bargaining with a port services supplier over contract terms. Under Mintzberg's classification, which group of roles is she performing?
Pick an option first
Question 2 of 3An excellent accountant who supervised the payables team is promoted to finance director and struggles in the new post. Using Katz's three skills, what is the most likely reason?
Pick an option first
Question 3 of 3What did Mintzberg find when he watched what managers actually did?
Pick an option first