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HEST 5002
Health Care Management
Management Theories:Organisational Theory
2 February 2011
(Week 18)
Learning Outcomes
To provide a critical appreciation ofdifferent management theories
To develop an understanding of thesedifferent theories and their application tohealth care
Outline of this sessionConsider briefly different managementtheories and their application to healthcare:
1. Scientific management
2. Classical management
3. Human relations school of management
4. Systems Theory
5. Contingency Theory
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A timeline of management theory
Theory
Time1800s 1900s 1980s
ScientificManagement
ClassicalManagement
Humanrelations
school
Contingency &
Systems Theory
1. Scientific Management
The founding father is credited as FWTaylor
Theories based on his own experience ofwork
Studied people at work, e.g. pig-iron
handlers in the late 1800s Theories geared towards efficiency of
working methods and workers rewardedfor their own efficiency
Scientific Management cont.
4 scientific principles:
Development of a true science for everyoneswork
Scientific selection, training and developmentof workers
Co-operation with workers to ensure it iscarried out in a prescribed way
Division of work and responsibility
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Scientific Management cont.
Taylors ideas takenforward by others:
Frank Gilbrethstudied bricklayers
Henry Gantt deviseda chart to representwhen tasks wereplanned and bywhen they should beachieved (seeexamples)
Scientific Management cont.
Q: What potentialbenefits do you thinkarose out of Scientific
Management?
Q: What potentialcriticisms do you thinkcould be made
against ScientificManagement?
2. Classical ManagementThe founding father is seen as Henri Fayol
To manage is to forecast and plan, to organise, to
command, to coordinate and to control
Fayol developed 14 principles of management,which have since been classified into areas suchas:
bureaucracy,
hierarchy,
workers rights (fairness and job stability)
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Classical Management cont.
6 key activities:
Technical
Commercial
Financial
Security
Accounting
Managerial
Classical & Scientific Management
These theories do apply to managementeven today:
plan ahead,
count things and movements,
allocate tasks and responsibilities,
limit your span of control, review results.
3. Human relations school of
management
Not to be mistaken with human resourcemanagement (main focus is on attitudes andbehaviour of employees) covered in HEST
5006
Origins in early 1900s as a response to scientificmanagement (Mary Parker Follett and EltonMayo and the Hawthorne experiments)
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Main focus
Emphasising the importance of socialprocesses at work
Meeting peoples needs for belonging andfor group membership
Management of people in teams andgroups and the effects they have on theorganisation
Hawthorne experiments (1924-1932)
A series of different experiments at theWestern Electric Company using:
Lighting conditions
Relay assembly room
Bank wiring roomInterviewing
4. Systems Theory a collection of parts unified to
accomplish an overall goal. If one part ofthe system is removed, the nature of thesystem is changed as well.
4/5 distinct parts: Inputs (Transformation)
Outputs
Outcomes
Feedback
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History of Systems Theory
Hegel (1800s): historical development is adynamic process
Marx & Darwin
Von Bertalanffy (1968/9): biologicalbackground, but used it as the basis of hisstudy of general system theory
Organisational Factors
1. Inputs (Transformation)
2. Outputs
3. Outcomes
4. Feedback
Systems TheoryI T O Oc
F
I = inputs
T = transformationO = outputs (Oc = outcomes)
F = feedback
E = environmentE
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Assumptions
1. Objects the parts, elements, or variables within thesystem. These may be physical or abstract or both,
depending on the nature of the system.
2. A system consists of attributes the qualities orproperties of the system and its objects.
3. A system had internal relationships among itsobjects.
4. Systems exist in an environment. A system, then, is aset of things that affect one another within an
environment and form a larger pattern that is different
from any of the parts.
System Theory Characteristics
Wholeness, interdependence and correlations
Suprasystems and subsystems
Self-regulation and control
Interchange with the environment
Balance/homeostasis
Change and adaptability (morphogenesis)
What has it added to
management theory?
Brought a new perspective for managers tointerpret patterns and events in the workplace.
Recognises the various parts of the organisation,and, in particular, the interrelations of the parts,e.g. manufacturing, supervisors with workers, etc.
In the past, managers typically took one part andfocused on that. Then they moved all attention toanother part, but the departments didnt synchronize at
all.
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5. Contingency Theory
The study of any complex system
Often applied to strategic andorganisational management
The it depends approach: environment
Contingency Theory
Coined by Lawrence and Lorsch (1965)
the amount of uncertainty and rate of changein an environment impacts the development ofinternal features in organisations
Galbraith (1973)
There is no one best way to organise
Any way of organising is not equally effective
Contingency Theorythe best way to organise depends onthe nature of the environment to which theorganisation relatesContingency theoryis guided by the general orientinghypothesis that organisations whoseinternal features best match the demandsof their environments will achieve the bestadaptation.
Scott (2003)
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Conflict in contingency theory
Inter-departmental conflict caused by: mutual task dependence,
task-related asymmetries,
conflicting performance criteria,
dependence on common resources,
communication obstacles,
ambiguity of goals, and
organisational differentiation
Contingency & Systems Theory
Clear relationship between the two
One describes the concepts that existwithin an environment
The other describes the complexity thatexists by being part of an environment
A system in health care
Naylor (2004) p.35
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A system in health care cont.
Application to the NHS
Consider the changing nature of illness, diseaseand technological innovation
The NHS operates in an uncertain environment
Many complex factors cause multiple effects onhealth service delivery
Environment is key in both these theories andthe NHS
Impact on the NHS Additional management schools of thought
that fit better than traditional scientific orclassical theories.
Helps managers and leaders to accept thecomplexity of their decisions but doesprovide a framework of sorts to helprationalise it.
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Summary
Considered a number of key historical managementtheories and their application to health care
Classical and scientific management: the firstrecorded principles of management
Human relations school: focus on workers aspeople and their interactions
Systems and contingency theory add to existingmanagement and organisational theory by allowingfor the acceptance of disorder, uncertainty, chaos andcomplexity
All have a role to play in real-life application to theNHS operating environment
References & Further Reading
1. Bertalanffy, von, L. (1968). General systems theory.New York: Braziller.
2. Bertalanffy, von, L.(1969), General System Theory:Foundations, Development, Applications
3. Boddy, D. (2002) Management: An IntroductionFTPrentice-Hall
4. Cole G. A. (2004) Management Theory and Practice(6th Edition). London: Thompson.
5. Dawson, S.J.N. (1999). Managing, Organising and
Performing in Health Care: What do we Know and Howcan we Learn? in Mark, A. L., Dopson, S. (eds)Organisational Behaviour in Health Care. Basingstoke:Macmillan.
6. Infante, D.A., Rancer, A.S. & Womack, D.F. (1997).Building communication theory. Prospect Heights,Illinois: Waveland Press.
7. Laarmans, R. (1999). Communicatie zonder Mensen.
Amsterdam: Uitgeverij Boom.8. Littlejohn, S.W. (2001). Theories of Human
Communication. Belmont, CA: Wadsworth/ ThomsonLearning.
9. Lorsch, J. W. & Lawrence, P. R. (1965) Organisation forproduct innovation, Harvard Business Review, 43: 109-120
10. Luhmann, N. (1984). Soziale Systeme. Grund einerallgemeinen Theorie. Frankfurt am Main: Suhrkamp.
11. McNamara, C. (1997-2008).Brief Overview ofContemporary Theories in Management. [online].Available from:http://www.managementhelp.org/mgmnt/cntmpory.htm
12. Midgley, G. (Ed.) (2003). Systems thinking. London:Sage.
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13. Morgan, G. (1986). Images of Organisation. London:Sage.
14. Scott, W. R. (2003). Organizations: Rational,natural, and open systems(5th ed.). Upper Saddle
River, NJ: Prentice Hall.
15. Skyttner, L. (1996). General Systems Theory: An
Introduction
16. Thompson, D. (1987). Coalitions and Conflict in theNHS: Some Implications for General Management,
Sociology of Health and Illness, 9(2) 127-53.
APPENDIX 1:The 14 principles of Classical Management
1. Division of work
2. Authority
3. Discipline
4. Unity of command
5. Unity of direction
6. Subordination ofindividual intereststo the generalinterest
7. Remuneration
8. Centralisation
9. Scalar chain
10.Order
11.Equity
12.Stability of tenure ofpersonnel
13.Initiative
14.Esprit de corps
Class Work (optional) Why is management important to you in your
job?
With reference to your workplace, consider howthe management theories weve examined today
help you / your team function?
How would you improve on those theories?
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