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Historical Background of ManagementMajor Approaches To Management

Classical Approaches

Panel 2.1: The Historical PerspectiveClassical ViewpointEmphasis on ways to manage work more efficiently Scientific ManagementEmphasized scientific study of work methods to improve productivity of individual workersProponents: Frederick W. Taylor Frank & Lillian GilbrethAdministrative ManagementConcerned with managing the entire organizationProponents: Henry Taylor Max WeberBehavioral science approachRelies on scientific research for developments theory to provide practical manager toolsBehavioral ViewpointEmphasis on importance of understanding human behavior & motivating & encouraging employees toward achievementEarly BehavioristsProponents: Hugo Munsterberg, Elton MayoHuman Relations MovementProposed better human relations could increase worker productivity Proponents: Abraham MaslowDouglas McGregorQuantitative ViewpointApplies quantitative techniques to management Operations ManagementFocuses on managing the production and delivery of an organizations products or services more effectivelyManagement ScienceFocuses on using mathematics to aid in problem solving and decision making5Scientific Management Scientific Management: emphasized the scientific study of work methods to improve the productivity of individual workers Two of its chief proponents were Frederick W. Taylor, & Frank and Lillian Gilbreth

Scientific Management

Credit for Scientific Management goes to Frederick Taylor who was hired by Midvale Steel company in the US in 1878.Taylor discovered that production and pay were poor ,inefficiency and waste were prevalent ,and most companies had unused potential .He concluded that management decisions were unsystematic and no efforts were made to determine the best means of production Scientific Management

The Taylor introduced Scientific Management (he is called the Father of Scientific Management ) which recommended the application of scientific methods to analyze work and to determine the methods to complete the tasks efficiently8Principles of Scientific Management Workers are essentially economic beings Workers should be developed to their maximum potential Competitive pay systemCooperation between managers and workersOrganizational and individual goals should be compatible

9Scientific management

Study jobs systematically with a view to improving the way tasks are performedSelect the best employees for the various jobs.Train the employees in the most efficient methods Offer incentives (higher wages) to the most ableemployees and use piece-rate system of payment to encourage greater effort.Use rest pauses to combat fatigueEntrust to supervisor the task of ensuring that employees are using the prescribed methods

Scientific Management

The ideas of scientific Management dramatically increased productivity across all industries ,and they are still important today. 11Administrative Management Administrative Management: concerned with managing the total organizationAmong the pioneering theorists were Henry Fayol & Max Weber

12Henry Fayol and the Functions of ManagementPlanning You set goals and decide how to achieve themOrganizing You arrange tasks, people, & other resources to accomplish the workLeadingYou motivate, direct & otherwise influence people to work hard to achieve the organizations goalsControllingYou monitor performance, compare it with goals and take corrective action as neededHenry Fayol was the first to systematize management management behavior he was the first to identify the major functions of management: planning, organizing, leading, controlling, as well as coordinating13Fayal's 14 Principles of ManagementDivision of labor-Divide work into specialized tasks and assign responsibilities to specific individuals.

Authority -Delegate authority along with responsibility

Discipline Make expectations clear and punish violators Fayal's 14 Principles of Management4-Unity of commandEach employee has one and only one boss5-Unity of Direction- Employees efforts should be focused on achieving organizations direction.6-Subordination of Individual interest to the general interest When at work, only work things should be pursued or thought about.

Fayal's 14 Principles of ManagementRemunerationEmployees receive fair payment for services,Centralization- Decisions are made from the top. Scalar Chain(line of authority). Formal chain of command running from top to bottom of the organization, like military Order-All materials and personnel have a prescribed place, and they must remain there.

Fayal's 14 Principles of ManagementEquity-Equality of treatment Stability and tenure of personnel-Promote employee loyalty and longevity

Initiative-Thinking out a plan and do what it takes to make it happen.

Fayal's 14 Principles of ManagementEsprit de corps-Promote a unity of interest between employees and management 18Max Weber & the Rationality of Bureaucracy: To Weber, a bureaucracy(Successful implement the actions of an organization of any size in achieving its purpose.) was a rational, efficient ideal organization based on principles of logiche felt good organizations should have five bureaucratic featuresMax Weber & the Rationality of BureaucracyLabor is divided with clear definitions of authority and responsibility.Positions are organized in a hierarchy of authority ,with each position under the authority of a higher one

Max Weber & the Rationality of BureaucracyRules and regulations determine and standardize behavior Administrative acts and decisions are recorded in writingManagement is separate from ownership in any organization.

21Classical bureaucracyMax Weber, 1947Hierarchy of authorityRights and duties are attached to the various positions Division of labourRules and proceduresDocumentation in which info is recorded in written form Technical competenceSeparation of ownership from control22The Problem with the Classical Viewpoint The classical viewpoint tends to be too mechanistic: it tends to view humans as cogs within a machine, not taking into account the importance of human needs

Behavioral Management Theory

Human Relations ManagementHawthorne Studies

Hawthorne studies was conducted at the western Electric Company in the US between 1924-1932Elton Mayo was a professor of Industrial Research at the Harvard School of Business Administration He is called the Father of human relations movement . 24Elton Mayo & the Supposed Hawthorne Effect

Elton Mayo and his colleagues conducted studies at Western Electrics Hawthorne Plant and began with an investigation to see if different lighting affected workers productivity

Hawthorne studiesThe Hawthorne project involved three sets of studies Illumination StudiesThe Relay Assembly Room StudyThe Bank Wiring Room Illumination Studies

Illumination studies constituted the first set of experiments and took place between 1924 and 1927Experiment -Lighting was decreased Result-The researches concluded that factors other than lighting were at workExperimentThe first study was conducted by a group of engineers seeking to determine the relationship of lighting levels to worker productivity. Surprisingly enough, they discovered that worker productivity increased as the lighting levels decreasedThe Relay Assembly Room studyA few years later, a second group of experiments began. Harvard researchers Mayo and F. J. Roethlisberger supervised a group of five women in a bank wiring room. They gave the women special privileges, such as the right to leave their workstations without permission, take rest periods, enjoy free lunches, and have variations in pay levels and workdays. This experiment also resulted in significantly increased rates of productivity.The Bank Wiring Room StudyFor this study a group of 14men who wired telephone banks was observed in a standard shop condition An observer was stationed in the room with instructions to take continuous notes on the workers actions .The observer were not allowed to give orders or to get involved in conversations with the workers .

The Bank wiring Room StudyThe researches concluded that the behavioral norms set by the work group had a powerful influence over the productivity of the group.The power of the peer group and the importance of group influence on individual behavior and productivity were confirmed in the bank wiring room. Human Resource ApproachThe Human relations approach highlighted the impact of behavior on performance .Interpersonal behavior has its impact on satisfaction which in turn may lead to improved performance .Abraham Maslow and Douglas Ac Greg or .Their contribution form the human resource approachMaslow Hierarchy Of NeedsSelf-Actualization Esteem Needs Social Needs Safety Needs Physiological NeedsBehavioral Science ApproachPsychologist ,sociologists and others began studying people at work .The behavioral science approach believes that an individual is motivated to work for many reasons in addition to making money and forming interpersonal relationships.Behavioral Science ApproachThe principals of behavioral science approach are being practiced in every organization and behavioral science as a course more popularly known as Organization Behavior. 36Panel 2.2: The contemporary perspective: Three ViewpointsThe System ViewpointRegards the organization as a system of interrelated parts that operate together to achieve a common purposeThe Contingency ViewpointEmphasizes that a managers approach should vary according toI.e. be contingent onthe individual and environmental situationThe Quality Management ViewpointsThree approachesQuality ControlStrategy for minimizing errors by managing each state of productionProponent: Walter StewartQuality AssuranceFocuses on the performance of workers urging employees to strive for zero defectsTotal Quality ManagementComprehensive approach dedicated to continuous quality improvement, training, and customer satisfactionProponents: W. Edward DemingJoseph M. Juran37Systems Approach (60-70s)A system is set of interrelated and interdependent parts arranged in a manner that produces a unified whole 38 Open and Closed Systems Open System continually interacts with its environment

Closed System has little interaction with its environment; it receives very little feedback from the outside

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The Systems Viewpoint The Systems Viewpoint regards the organization as a system of interrelated parts By adopting this perspective you can look at your organization in two waysA collection of subsystemsparts making up the whole systemA part of the larger environment

40The Four Parts of a SystemInputsThe people, money, information, equipment, and materials required to produce and organizations goods or services OutputsThe products, services, profits, losses, employee satisfaction or discontent, and the like that are produced by the organizationTransformational ProcessesThe organizations capabilities in management and technology that are applied to converting inputs to outputs FeedbackInformation about the reaction of the environment to the outputs that affect the inputs

41Contingency approachThe contingency approach sometimes called the situational approach says that organizations are different ,face different situations ,and require different ways of managing.42Contingency approachA good way to describe contingencyIf this is the way my situation is then this is the best way for me to manage in this situationThis approach is intuitively logical because organizations and even units within the same organization differ-in terms of size ,goals , work activities. 43The Contemporary Perspective: The Contingency Viewpoint The Contingency Viewpoint emphasizes that a managers approach should vary according tothat is, be contingent onthe individual and the environmental situation

Contingency approachThe Primary value of the contingency approach is that it stresses that there are no simplistic or universal rules for managers to followQuantitative ApproachThe Quantitative approach evolved from mathematical and statistical solutions developed for military problems during word war II.After the war was over , many of these techniques used for military problems were applied to businessQuantitative ApproachOne group of military officers ,nicknamed the whiz kids joined Ford Motor Company in the mid -1940s and immediately began using statistical methods and Quantitative models to improve decision making47The Contemporary Perspective: The Quality Management Viewpoint The Quality Management Viewpoint includes quality control, quality assurance, and total quality management

48Total Quality Management: Creating an Organization Dedicated to Continuous ImprovementTotal Quality Management is a comprehensive approachled by top managers and supported throughout the organizationdedicated to continuous quality improvement, training and customer satisfaction

Four Components of TQM:

Make Continuous Improvement a PriorityGet Every Employee InvolvedListen to and Learn from Customers and EmployeesUse Accurate Standards to Identify and Eliminate Problems