Principles of Management and Organizational Behaviour

Public Management

Public management is the branch of management that deals with the planning, organising, directing, coordinating, controlling and accounting of public resources and public organisations to deliver public goods and services. It is the application of managerial principles and techniques to government institutions, public enterprises, constitutional bodies and local governments, with the twin objectives of efficiency (doing things right) and effectiveness (doing the right things) in serving citizens.

Its key features are:

• Public accountability — managers answer to the legislature, audit bodies and ultimately the people.
• Legal–constitutional framework — action is bound by law, rules, budget and procedure.
• Service motive over profit motive — the goal is public welfare, not private gain.
• Use of public funds — resources are collected through taxes and fees, so economy and transparency are essential.
• Multiple stakeholders — citizens, politicians, civil servants, donors and interest groups all influence decisions.

Public management has evolved from Traditional Public Administration (Weberian bureaucracy, Wilson's politics–administration dichotomy, focus on rules and process) to the New Public Management (NPM) of the 1980s–90s (Osborne and Gaebler's Reinventing Government), and further to New Public Governance and Digital Governance. NPM rests on market-based ideas: managerial autonomy, performance contracting, competition, outsourcing, citizen-as-customer, and "steering rather than rowing".

Challenges of NPM in Developing Countries like Nepal

NPM was designed in and for developed, mature democracies with strong institutions. Transplanted to developing countries, it faces the following challenges:

1. Weak institutional and legal foundation. NPM assumes enforceable contracts, independent regulators and reliable courts. In Nepal, weak enforcement, frequent legal amendments and political interference undermine contract-based management.

2. Political instability and short-termism. Coalition governments change frequently; ministers and secretaries are transferred often. Performance contracts and multi-year plans lose continuity before results appear.

3. Inadequate administrative capacity. NPM demands skills in costing, performance measurement, financial analysis and IT. Nepali civil service remains rule-bound, understaffed in technical areas, and resistant to change.

4. Corruption and weak accountability. Market mechanisms such as outsourcing and public–private partnership presume integrity. Where rent-seeking is high, contracting-out becomes a route for patronage rather than efficiency.

5. Weak private sector and market. Competition requires many capable service providers. In many districts of Nepal, monopoly or oligopoly conditions mean "choice" and "competition" exist only on paper.

6. Citizens as customers — a flawed analogy. Many Nepali citizens lack information, mobility and voice; treating them as customers ignores equity, inclusion of Dalit, Janajati, women and remote populations, and the reality that public services are rights, not commodities.

7. Fragmented donor-driven reform. NPM-style reforms (MTEF, performance-based budgeting, e-governance) are often pushed by donors as conditions, producing form without function — plans written but not implemented.

8. Resource constraints. Austerity, thin revenue base and dependence on foreign aid limit investment in the systems (MIS, training, monitoring) that NPM needs to work.

9. Cultural mismatch. Nepali public administration values seniority, hierarchy and process compliance; NPM values risk-taking, delegation and outcome orientation. This clash slows adoption.

10. Equity and regional imbalance. Performance-based funding can starve already disadvantaged areas (Karnali, Sudurpaschim) of resources, widening the development gap.

Conclusion. NPM offers useful tools — performance measurement, citizen charters, e-services, competition — but in Nepal these must be adapted, not transplanted. Sequencing matters: first strengthen the rule of law, audit, and administrative capacity; then introduce market-type mechanisms selectively. A hybrid model that blends NPM efficiency with the equity and accountability goals of New Public Governance is the realistic path for Nepal.

Career Development

Career development is the lifelong process by which an individual manages his or her own career — exploring, choosing, planning and progressing through work roles — while the organisation supports that progress through learning, training and planned job experiences. In human resource management, it is the deliberate effort to match the employee's career needs and aspirations with the present and future human resource requirements of the organisation. It is a continuous, lifelong and two-way process: the employee supplies the ambition and effort, the organisation supplies the structure, opportunities and support. Its main objectives are to develop the employee's potential, improve motivation and job satisfaction, reduce turnover of valuable staff, ensure a ready supply of internal talent for higher positions, and align individual growth with organisational strategy.

Career development is carried out through the following methods:

1. Individual methods (initiated by the employee)

• Career planning: The employee assesses his own strengths, weaknesses, interests and values, sets short-term and long-term career goals, and prepares an action plan to reach them. The organisation assists through counselling and by providing career information.
• Self-development: Self-study, reading professional literature, acquiring additional qualifications, learning new software or languages, and pursuing higher education on one's own initiative.
• Career counselling: Periodic discussion with the supervisor or HR officer to clarify career goals, identify development needs and receive feedback on performance and potential.
• Mentoring: A senior, experienced employee (mentor) guides a junior (protégé) over a long period, sharing knowledge, experience and networks, and giving advice on career moves.
• Networking: Building contacts within and outside the organisation to learn about opportunities and gain visibility.

2. Organisational methods (initiated by the employer)

• Training and development programmes: In-house and external training, workshops, seminars, e-learning and executive development programmes that build the competencies required for present and future jobs.
• Job rotation: Moving employees periodically from one job or department to another so that they acquire a broad range of skills and understand the whole organisation. It is widely used for management trainees.
• Job enlargement and job enrichment: Enlargement adds more tasks of the same level to widen the job; enrichment adds responsibility, autonomy and decision-making to deepen the job. Both increase competence and prepare the employee for higher duties.
• Promotion and transfer: Promotion moves an employee upward to a position of greater responsibility, authority and pay; transfer moves him laterally to a job that better suits his abilities or widens his experience. Both are powerful career-development tools.
• Succession planning: Identifying key positions and developing a pool of capable internal candidates to fill them when they fall vacant, so that the organisation is never left without ready replacements.
• Career pathing / dual career ladder: Charting the sequence of positions an employee may hold, and offering parallel technical and managerial ladders so that specialists can advance without being forced into management.
• Performance appraisal and feedback: Systematic evaluation that tells the employee where he stands, what his potential is and what he must improve — the base on which all further development is planned.
• Tuition reimbursement and study leave: Financial and time support for employees to obtain higher degrees or professional certifications.
• Special assignments and committees: Giving employees task-force membership, project leadership or committee duties that test and develop their capabilities.
• Career resource centres and information systems: Providing employees with information on vacancies, job requirements and career paths, and maintaining a human resource inventory/skills bank so that talent can be matched to openings.

Conclusion: Career development succeeds only when individual methods and organisational methods work together. The employee must take charge of his own growth, and the organisation must create a supportive climate — training, fair promotion, mentoring and succession planning — so that both the individual and the organisation grow together.

Performance Appraisal

Definition: Performance appraisal is the systematic, periodic and impartial evaluation of an employee's job performance, potential and suitability for future roles against pre-determined standards. It measures what an employee does (results) and how he/she does it (behaviour), and provides the basis for decisions on promotion, transfer, reward, training and development. In the context of the Employees Provident Fund, it is the formal process through which the performance of an employee is assessed periodically against assigned targets and organisational norms.

Methods of Performance Appraisal

The methods are broadly classified into two groups:

A. Traditional Methods

1. Straight Ranking Method — All employees of a unit are ranked from best to worst on overall performance. Simple but lacks objectivity and gives no feedback on specific strengths or weaknesses.
2. Paired Comparison Method — Each employee is compared with every other employee, one pair at a time, and the number of times an employee is judged better determines the rank. More reliable than straight ranking but becomes unwieldy with many employees.
3. Grading Method — Employees are placed in predefined grades such as outstanding, very good, good, satisfactory and poor, based on specified criteria.
4. Forced Distribution Method — Raters are compelled to distribute employees into a fixed pattern (e.g., 10% top, 20% next, 40% middle, 20% next, 10% bottom), which reduces central tendency but may be unfair to a uniformly good group.
5. Checklist Method — The rater ticks statements describing the employee's traits and behaviour; weights are assigned to each statement and the total score gives the appraisal.
6. Critical Incident Method — The supervisor maintains a record of critical (especially effective or ineffective) incidents of an employee's behaviour and discusses them at the appraisal time.
7. Confidential Report — A confidential report on the employee's performance, conduct and character is prepared by the superior, commonly used in government and public enterprises.
8. Essay Method — The rater writes a free-form narrative describing the employee's performance, potential and training needs.

B. Modern Methods

1. Management by Objectives (MBO) — Superiors and subordinates jointly set specific, measurable and time-bound goals; performance is appraised against the achievement of these mutually agreed goals.
2. 360-Degree Appraisal — Feedback is collected from all around the employee — superiors, peers, subordinates, self and sometimes customers — giving a comprehensive picture of performance.
3. Assessment Centre — Employees are assessed through simulations, in-basket exercises, group discussions and role plays observed by trained assessors, mainly for identifying managerial potential.
4. Human Resource Accounting — Performance is evaluated in terms of the cost and contribution of the employee to the organisation, i.e., the value the employee adds over the cost incurred.
5. Behaviourally Anchored Rating Scales (BARS) — Rating scales are anchored with specific, observable examples of job behaviour ranging from poor to excellent, combining the benefits of rating and critical incident methods.
6. Key Performance Indicators (KPI) / Balanced Scorecard — Performance is measured through quantified indicators linked to financial, customer, internal process and learning perspectives.

Conclusion

Traditional methods focus on traits and comparison among employees, while modern methods focus on results, potential and multi-source feedback. For an organisation like the Employees Provident Fund, a combination of MBO/KPI-based appraisal with elements of 360-degree feedback is most suitable, as it aligns individual performance with organisational objectives and supports objective decisions on promotion and rewards.

Conflict Management

Conflict is a disagreement or clash between two or more individuals or groups arising from differences in interests, goals, values, perceptions or expectations. Conflict management is the process of identifying, addressing and resolving such disagreements in a constructive way so that their negative effects are minimised and their potential benefits (better decisions, innovation, stronger relationships) are used. It does not always mean eliminating conflict; often it means keeping it at an optimal, functional level. The main approaches are avoidance, accommodation, competition, compromise and collaboration — of which collaboration (win–win problem solving) is generally the most effective.

Causes of Conflict in an Organization

1. Structural causes

• Goal incompatibility: Different departments pursue different goals — e.g. sales wants large stocks for quick delivery while finance wants low inventory to cut costs.
• Scarce resources: Limited budget, manpower, equipment or space force units to compete for the same resources.
• Task interdependence: When one unit's output is another's input (e.g. production depends on procurement), delays or errors create friction.
• Unclear responsibility: Overlapping duties, vague job descriptions and unclear authority lead to disputes over "whose job it is".
• Organizational change: Restructuring, downsizing, mergers or new technology create uncertainty, fear of job loss and resistance.

2. Communication causes

• Semantic barriers: Ambiguous words, poor wording and different interpretations of the same message.
• Insufficient or excessive information: Too little information breeds suspicion; too much causes overload and confusion.
• Poor channels: Faulty reporting lines, rumours through the grapevine and lack of feedback.
• Communication style: Aggressive tone, interruption and non-listening behaviour.

3. Personal and behavioural causes

• Personality differences: Clash of attitudes, values, ego and temperament among individuals.
• Perceptual differences: People see the same situation differently due to different backgrounds, experience and expectations.
• Emotional states: Stress, frustration, anger or insecurity make people react sharply.
• Cultural and value differences: Differences in language, religion, ethnicity, generation or work ethic.

4. Leadership and managerial causes

• Unfair or autocratic supervision: Favouritism, biased appraisal, close supervision and denial of autonomy.
• Inconsistent rules and policies: Selective enforcement of discipline, promotion or reward systems.
• Inadequate leadership: Failure to define roles, set standards or resolve grievances in time.
• Competition for power and status: Rivalry for promotion, recognition and control over resources.

Conclusion

Conflict is natural and unavoidable in organizations. Its causes lie mainly in structure, communication, personal differences and managerial practice. A good manager therefore diagnoses the real cause, chooses the right style — collaboration for important issues, compromise for quick settlements — and channels conflict towards constructive outcomes rather than suppressing it.

Organizational Change

Organizational change refers to any alteration in the structure, technology, processes, people, or culture of an organization. It is the process by which an organization moves from its present state to a desired future state in order to improve its effectiveness, survive in the environment, or gain competitive advantage. Change may be incremental (small, continuous adjustments) or transformational (radical shifts such as restructuring, mergers, or adoption of new technology). It is a continuous phenomenon because an organization is an open system that must constantly adjust to its internal and external environment.

According to Robbins and Coulter, change is "an alteration in people, structure, or technology." Change typically involves three stages — unfreezing (preparing for change), changing (implementing the change), and refreezing (stabilizing the new state), as described in Kurt Lewin's model.

Reasons for Resistance to Change

Employees and groups resist change for several reasons, which may be individual or organizational:

1. Habit and comfort with the status quo — People are used to existing routines; changing them requires new learning and effort.
2. Fear of the unknown — Employees worry about how the change will affect their jobs, roles, and future.
3. Threat to job security — Change such as automation, downsizing, or restructuring creates fear of job loss.
4. Economic factors — Fear of reduced income, loss of allowances, or the cost of learning new skills.
5. Loss of power, status, and control — Those who hold authority or expertise may feel their influence will decline.
6. Threat to expertise and skills — Employees with specialized skills may fear their competence will become obsolete.
7. Group and social factors — Work groups resist change that disrupts established social relationships and norms.
8. Organizational structure and culture — Rigid structures, bureaucratic rules, and conservative cultures discourage change.
9. Lack of trust in management — If employees distrust the motives of those introducing change, they resist it.
10. Poor communication and participation — When employees are not informed or involved, uncertainty and resistance increase.
11. Resource constraints and past failures — Limited resources or memories of unsuccessful change efforts create scepticism.
12. Selective perception and inertia — People filter information to fit their existing views and prefer stability.

Conclusion

Organizational change is essential for survival and growth, but it inevitably faces resistance. Managers must reduce resistance through effective communication, participation of employees, education and training, leadership support, negotiation, and, where necessary, coercion. In an organization like the Employees Provident Fund, where change affects employees and millions of contributors, a planned and participative approach to change is vital for success.