Good management is evidenced by:

• Cleanliness and tidiness of the premises,
• Arrangement of machinery and processes so that work proceeds smoothly,
• Efficient, regular maintenance and adjustment of the machinery,
• Strict adherence to all statutory rules, regulations and expressed requirements,
• The steady activity of the employees.
• Discipline and control of employees;
• Good labor relations
• Good lubrication methods
• Satisfactory clearance and disposal of waste and salvage.
• Good factory set up (layout)

Factory Layout

The layout of a factory’s production processes is a good indicator as to the quality of management. A good factory lay out is a clear indicator of good management and vice versa. A good layout ensures that:

• Raw materials enter one end of the factory, travels straight through the factory during its conversion by machining or trade process into the finished product, and emerges at the other end ready for packing and conveniently placed for dispatch and conveyance.
• Work flows smoothly, and the cost of carrying work in progress back and fourth is minimized.
• Employees do not have to make unnecessary journeys about the factory.
• Convenient position of stores
• Good factory systems for recording jobs, obtaining materials from stores, checking and temporary storage of partly finished goods.

Bad Management with inadequate supervision is shown by features such as:

• Lack of cleanliness and untidiness;
• Bad arrangement of machinery, and processes so that everyone seems to be in the way of someone else;
• Spasmodic maintenance of machinery;
• Carelessness on the part of the management and or employees;
• Preponderance of cheap labor which is usually inefficient.

 Labor Relations

• The type of Labour force and
• Working Conditions

Moral hazards may also arise from the actions of employees and third parties.  Discontented or disinterested employees carelessly or even criminally cause fire damage to the property of their employer. A good relationship between the employer and the employee is therefore essential for the efficient operations of a business.

When the staff is controlled by good management with the proper enforcement of rules, it is certain that routine duties such as the regular filling of fire buckets, and the closing of fire proof doors will be observed; packing materials will be kept in their proper bins, not left  strewn about the floor; supplies of flammable materials will be kept in their proper store places and not left lying where they were last used.

Type of labor: The type of labor is an important issue to be considered. The employment of skilled, permanent labor implies a reliable staff whereas casual laborers may be less reliable and disinclined to observe rules, regulations and precautions.

Well-disciplined staff means that care is taken to prevent losses.

Working Conditions: Good working conditions together with a carefully selected and contented labor force are major factors in controlling property damage. The comfort and welfare of employees is an essential feature of good management, which leads to a well-disciplined staff.

Staff comfort which includes adequate lighting, heating, ventilation, and reasonable break periods leads to discipline, which eventually results in good work and careful operation by the employees.

Uncomfortable and dissatisfied staff do not care much about anything in the place where they work. This may lead to neglect of precautions, carelessness or even deliberate acts of arson.