Management is the art of securing maximum prosperity with a minimum effort. Wherever, there is an organised group of people working towards a common goal, some type of management becomes essential. According to P.F. Drucker, “Management is a dynamic life giving element in an organisation. In its absence the resources of production remain resourses and never become production”. The following points further highlight the importance of management.
1. Achievement of group objective: It is the management which makes people to realise the objectives of the group.
2. Optimum utilisation of resources: The four factors of production viz., land, labour, capital and enterprise may prove ineffective in the absence of management. It is the management which makes the optimum utilisation of resourses possible.
3. Minimisation of cost: Through better planning, sound organisation and effective control, management enables a concern to reduce costs and enable the enterprises to face cut-throat competition.
4. Increased profit: Profits can be increased either by increasing the sales revenue or by reducing the cost.
5. Smooth running of business: Management ensures efficient and smooth running of business through better planning, sound organisation, and effective control.
6. Provides innovation: Management provides new ideas, imagination and vision to the organisation.
7. Change and growth: Management is needed to meet the challenges and complexities of advanced technology.
8. Social benefits: Management is beneficial to the society. It raises standard of living by providing quality products and services at the lowest possible rates.