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School of Management Thoughts.pptx

  1. Management Thoughts
  2. Types of Management Theories Management theories can be classified into three types 1.Classical Management Theory Behavioral Management Theory Modern Management Theory
  3. Classical Management Theory Classical approach to management stresses the manager’s role in a formal hierarchy of authority and focuses on the tasks, machines, and systems needed to accomplish the task efficiently.
  4. CLASSICAL APPROACH (cont.) Major managerial contributions can be discussed under the classical approach 1.Scientific Management Theory Administrative Management Theory Bureaucratic Management theory
  5. Scientific Management Theory This theory focuses on the improvement of operational efficiencies through the systematic and scientific study of work methods, tools, and performance standards. CLASSICAL APPROACH (cont.)
  6. Frederick Taylor’s Theory of Scientific Management Taylor’s theory of scientific management aimed at, improving economic efficiency, especially labor productivity. Taylor had a simple view about, what motivated people at work, - money. He felt that workers should get a fair day's pay for a fair day's work, and that pay should be linked to the amount produced. Scientific Management Theory (cont.) CLASSICAL APPROACH (cont.)
  7. Basic principles of scientific management 1. The development of management of scientific method of designing jobs. The principle involves gathering, classifying and tabulating data to arrive at the ―One best way‖ to perform task or a series of tasks. 2. The scientific selection of workers. The principle involves the scientific ―selection and progressive training and development of employees‖ so that each worker would be given responsibility for the task for which he/she is best suited. 3. Bringing together scientifically selected employees and scientifically developed methods of doing jobs by providing advice and explaining all issues. 4. A division of responsibility between management and labor. Scientific Management Theory (cont.) CLASSICAL APPROACH (cont.) Frederick Taylor’s Theory of Scientific Management (cont.)
  8. Henri Fayol’s Administrative Management Theory Fayol's administrative management theory can be described as an approach to management and increasing productivity by emphasizing organizational structure and human behavior. Fayol's theory is grounded in the five functions that represent management: planning, organizing, command, coordination, and control CLASSICAL APPROACH (cont.)
  9. CLASSICAL APPROACH (cont.) Functions of Management 1.Plan Organize Command 1.Coordinate 1.Control Henri Fayol’s Administrative Management Theory (cont.)
  10. Fayol’s 14 Principles of Management CLASSICAL APPROACH (cont.) 1. Division of Labor 8. Authority 2. Discipline 9. Unity of Command 3. Unity of Direction 10. Subordination of Individual Interest to the Common Goal 4. Remuneration 11. Centralization 5. The Hierarchy 12. Order 6. Equity 13. Stability of Staff 7. Initiative 14. Esprit de Corps Henri Fayol’s Administrative Management Theory (cont.)
  11. Max Weber’s Bureaucratic Theory of Management Weber made a distinction between authority and power. Weber believed that power educes obedience through force or the threat of force which induces individuals to adhere to regulations CLASSICAL APPROACH (cont.)
  12. Max Weber’s Six Principles Of Bureaucracy 1. Task Specialization 2. Formal Selection 3. Impersonal (Impersonality And Personal Indifference) 4. Hierarchical Layers Of Authority 5. Rules And Regulations 6. Career Orientation CLASSICAL APPROACH (cont.) Max Weber’s Bureaucratic Theory of Management (cont.)
  13. Elton Mayo’s Behavioral Theory of Management: This approach emphasized the importance of understanding human behavior, needs and attitudes in the workplace as well as social interactions and group processes.
  14. Hawthorne Effect Elton Mayo's experiments showed an increase in worker productivity was produced by the psychological stimulus of being singled out, involved, and made to feel important. Hawthorne Effect can be summarized as “Employees will respond positively to any novel change in a work environment like better illumination, clean work stations, relocating workstations, etc. Employees are more productive because they know they are being studied. BEHAVIORAL THEORY (cont.)
  15. Modern Management Theory Modern management theory emphasizes the use of systematic mathematical techniques to analyze and understand the inter- relationship of management and workers in all aspects.
  16. MODERN MANAGEMENT THEORY (cont.) Approaches of Modern Management Theory 1.Quantitative Approach Systems Approach Contingency or Situational Approach
  17. Quantitative Approach This approach is mainly focus on managerial decision making. Also known as management science approach. In this approach, all the decisions related to management are considered. Decisions should be according to need and requirement of organization which are created by management. Further three areas in this approach are: Operation research - gathering the all information related to specific tasks Operation Management - checks all the production process Management information system - helps to provide computerized information MODERN MANAGEMENT THEORY (cont.)
  18. Systems Approach This approach is specifically used to resolve the management problems .this is an integrated approach to find out the solutions of major management issues. This approach is working as all the points or systems are interconnecting with each other, their working depends on each other in a specified regularity to make a single product or achieve a single task MODERN MANAGEMENT THEORY (cont.)
  19. Contingency or Situational Approach This approach is helpful to resolve the problems of organizations with the help of analyzing the environment and conditions. This approach says that one set of rules are not enough to solve every type of problem. MODERN MANAGEMENT THEORY (cont.)

Hinweis der Redaktion

  1. Application of management knowledge is as old as human civilization. But development of management thought and theory is relatively of recent origin. The construction and completion of gigantic projects like Great Wall of China and construction of Egypt shows the use of management abilities by the people of ancient world. At that time probably, there was a jungle of management knowledge and people used it in their own way. However, Management was not emerged as a recognized discipline until the 20th century. The age of industrial revolution in the 19th century and subsequent emergence of large corporate organizations called for new approaches to management. During this period, previous management approaches (methods) no longer applied. No longer could managers make decision on-the-spot and maintain records in their heads. This is because, the industrial revolution of the 19th century had shifted the economy (USA) from a mainly agrarian one to an economy heavily involved with manufactured goods and industrial markets. This necessitates the need to standardize work methods for measuring work, and understand the psychological and physical aspects of a job such as monotony and fatigue. The environment that led to emergence of management thought is the subject of this chapter
  2. Types of Management Theories Management theories can be classified into three types Classical Management Theory Behavioral Management Theory Modern Management Theory
  3. Classical management theory is based on the belief that workers only have physical and economic needs and prescribes specialization of labor. Classical theories recommend centralized leadership and decision-making and focus on profit maximization. 
  4. Scientific Management Theory Administrative Management Theory Bureaucratic Management theory
  5. Its is believed that there is always a best standardized method of work for which the workers can be trained scientifically. Scientific Management The thought (approach) was formulated to increase productivity and make the work easier by scientifically studying work methods and establishing standards. The major contributors are Frederic W. Taylor, Frank and Lilian Gilbeth, Henery Gant & and Harrington Emerson. Frederic Taylor played the dominant role, and he is usually referred to as the father of scientific management. Taylorism of course, is a term used by many people to mean scientific management. The primary aim of scientific management was maximizing profits and minimizing costs of production. The guiding principle was ―getting the most out of the workers‖ Taylor developed a strong dislike for waste and inefficiency. He observed what he called soldiering, a term describing the actions of employees who intentionally restrict output because they feared they if all the work was completed they would be laid off. Taylor quickly understands that the wage system of that time which mostly based on attendance and position was the major factor for soldiering. Taylor believed a piece-rate system would work if the workers believed the standard had been fairly set and the management would stick to the standard. Taylor based his management system on production- line time studies. The system was also called time and motion studies. He used scientific and empirical methods rather than tradition and custom for setting work standards. Based on time and motion study Taylor and his associates developed the following basic principles.
  6. Taylor’s theory of scientific management aimed at, improving economic efficiency, especially labor productivity. Taylor had a simple view about, what motivated people at work, - money. He felt that workers should get a fair day's pay for a fair day's work, and that pay should be linked to the amount produced. In 1909, Taylor published "The Principles of Scientific Management.“ In this, he proposed that by optimizing and simplifying jobs, productivity would increase. He also advanced the idea that workers and managers needed to cooperate with one another. This was very different from the way work was typically done in businesses beforehand. A factory manager at that time had very little contact with the workers, and he left them on their own to produce the necessary product. There was no standardization, and a worker's main motivation was often continued employment, so there was no incentive to work as quickly or as efficiently as possible. Taylor believed that all workers were motivated by money, so he promoted the idea of "a fair day's pay for a fair day's work." In other words, if a worker didn't achieve enough in a day, he didn't deserve to be paid as much as another worker who was highly productive. Taylor's Differential Piece Rate Plan: If Efficiency is greater than the defined Standard then workers should be paid 120 % of the Normal Piece Rate. If Efficiency is less than standard then workers should be paid 80% of the Normal Piece Rate.
  7. 1. Replace working by "rule of thumb," or simple habit and common sense, and instead use the scientific method to study work and determine the most efficient way to perform specific tasks. 2. Rather than simply assign workers to just any job, match workers to their jobs based on capability and motivation, and train them to work at maximum efficiency. 3. Monitor worker performance, and provide instructions and supervision to ensure that they're using the most efficient ways of working. 4. Allocate the work between managers and workers so that the managers spend their time planning and training, allowing the workers to perform their tasks efficiently. The principle underlines division of responsibility between management and a worker is very essential. The principle also stress that management should work together with the workers to enhance intimacy, friendship and cooperation between them.
  8. In this Theory, He identified 5 elements of management Planning (Prevoyance)-To anticipate and outlining the path through which the goals can be achieved. Planning is looking ahead. According to Feyol, drawing up a good plan of action is the hardest of the five functions of management. Organization- Systematic way of material organization and human organization. The organizational structure with a good division of functions and tasks is of crucial importance. Commanding(Directing)-Administration should be able to direct the man power. It should be clear of the responsibilities of the subordinates and authorities it enjoys. Return from all employees will be optimized if they are given concrete instructions with respect to the activities that must be carried out by them. Coordination- Bringing harmony among various units and individual functionaries. When all activities are harmonized, the organization will function better. Control- Ensuring the performance of the workers are within the limits of norms and regulations of organization through techniques of reward and punishment. By verifying whether everything is going according to plan, the organization knows exactly whether the activities are carried out in conformity with the plan.
  9. Division of Work: Specialization of labor produces more and better work with the same effort. But he cautioned that the division of work should be optimum otherwise it may lead to overlapping and confusion. Discipline: Obedience should be observed in accordance with the standing agreements between the firm and its employees. Unity of direction: One head and one plan for each activity. Remuneration of personnel: The payment should be fair and just and afford satisfaction of both personnel and the firm. Scalar chain (Hierarchy): Hierarchy  is a vertical perspective. When all the layers or hierarchies or positions are taken together from top to bottom, then it is referred as the Scalar Chain. Each layer is bind to another layer through a relation called line of control or chain of command. He believed that the line of authority should not be broken, as it enables to maintain authority and discipline the organization. But Fayol came up with an exception called Gangplank, which is a jumping technique in which the concerned official establishes a relation with the immediate superior and they interact directly and solve the problem. Equity: For the personnel to be encouraged to fulfill their duties with devotion and loyalty there must be equity based on kindness and justice in employer-employee relations i.e, equity in terms of distribution of responsibility and reward. Initiative: The ability to think afresh would act as a powerful motivator of human behavior. Authority & Responsibility: Authority is the right to extract obedience from subordinates. The authority of individual should commensurate with responsibility Unity of Command: It means one subordinate should be accountable to only one super ordinate. This idea is contradictory to Taylor’s ‘Functional foremanship’ where one worker was working under 8 functional foremen. However, Taylor’s foremanship was defended on the idea that one worker had to do one specific job, thus each worker worked under a forman. Subordination of individual interest to general interest: The interest of one employee or group of employees should not prevail over that of the total organization. 11. Centralization: The power was concentrated at the hands of higher functionaries. The degree of initiative left to managers varies depending upon top managers, subordinates and business conditions. For instance, if the employer trusts the employee then the employer may decentralize the authority to the employee. 12. Order(Placement): Once the basic job structure has been devised, it is the placing of the right man at the right place. 13. Stability of tenure: Tenure is critical to the growth of organization as it should not be short that the position of an individual is undermined. On the other hand, it should not be long that complacency creeps in. Suitable conditions are to be created to minimize turnover of employees. 14. Esprit de Corps: Harmony, union among the personnel of an organization is a source of great strength in the organization. Develop trust and mutual understanding
  10. This theory stressed the need for a strictly defined hierarchy governed by clearly defined rules and regulations and line of authority in an organization. Managers do not like the word “bureaucracy” as it brings to mind frustration and waste. But bureaucracy would allows for orderly and systematic management of large groups of people.
  11. Let’s look at these in detail. Task Specialization The Max Weber Theory Of Bureaucracy Proposes That All Business Tasks Must Be Divided Among The Employees. The Basis For The Division Of Tasks Should Be Competencies And Functional Specializations. In This Way, The Workers Will Be Well Aware Of Their Role And Worth In The Organization And What Is Expected Of Them.  The Theory States That Division Of Labor Based On Expertise And Skills Is Immensely Beneficial For Any Business. This Also Ensures That Each Department Has Specific Tasks And Workers To Oversee Those Tasks.  The Tasks Are Carried Out Smoothly And Easily In This Manner Because Managers Know Who Is Working On Exactly What. The Accountability Of Each Task And Each Department Is Transparent. In Max Weber’s Bureaucracy, Each Employee Is Clearly Aware Of Their Responsibilities And Going Beyond Your Specialty Or Helping Your Colleagues Is Not Allowed.  Formal Selection Hiring And Onboarding Of Employees In The Bureaucracy Are Done Exclusively According To The Specialties And Technical Skills Of The Candidates. These Skills May Have Been Acquired By The Candidates Through Education, Training And Experience.  After Onboarding, Workers Must Be Compensated For Their Services, Which Depends On Their Position In The Organization. Their Contract Must Be Designed According To The Rules And Regulations Of The Organization And The Employee Can’t Hold Any Ownership Interest In The Organization.  Impersonal Relationships Another Principle Of The Bureaucratic Theory Is That The Relationships Among Employees And Between Managers And Employees Must Be Impersonal. They Should Only Be Of A Professional Nature And, Thereby, Distant. Weber Included This Principle In His Theory Because He Felt It Would Eliminate Nepotism, Politics And Outsider Involvement.  The Impersonal Relationships Are A Prominent Feature Of Max Weber’s Bureaucracy. Employees Are Not Allowed To Interfere With The Affairs Of Other Employees, Managers And The Organization. Communication Among The Employees Should Not Involve Emotions, Personal Sharing And Feelings. The Decision-Making Process Must Only Involve Rationality Instead Of Emotions.  Hierarchical Layers Of Authority In Bureaucratic Management, The Managerial Structure Is Organized Into Hierarchical Layers. Each Layer Of Management Has A Team Of Employees Under Them. These Managers Are Responsible For The Performance Of Their Team.  These Hierarchical Positions In Bureaucratic Organizations Are Essentially The Trademark And Foundation Of Max Weber’s Bureaucracy. In This Hierarchy Of Authority, Positions Are Ranked In Order Of Precedence And The Highest Position In The Ladder Generally Has The Highest Authority In The Organization. The Bottom Hierarchical Layers Are Generally The Positions That Are Supervised By Higher Layers.  Such Hierarchy In A Bureaucracy Reflects The Degree Of Delegation And Gives A Clear Picture Of The Division Of Authority And Responsibilities.  Rules And Regulations Max Weber’s Theory Of Bureaucracy Clearly Lays Out That Every ‘Rational Organization’ Must Have A Set Of Rules And Regulations. These Rules And Regulations Must Be Followed Without Any Fault. This Ensures Uniformity In The Business And The Staff Members Know What Is Expected Of Them.  Strict Rules Allow Better Coordination Of Employee Performance And Efforts. Administrative Processes Should Also Be Clearly Defined In The Official Rule Book Or Reports. When New Rules Are Introduced In The Organization, The Senior Management Must Be Notified. They Will Then Pass On The Information To Their Respective Departments.  Career Orientation The Weberian Model Of Bureaucracy Selects Employees On The Basis Of Technical Skills, Which Helps Optimize Human Capital. According To Max Weber, Selecting Candidates According To Their Competency And Skills Ensures That The Right People Are In The Right Jobs.  Consequently, Max Weber’s management theory states that through the formation of a bureaucracy, people can build a career upon their expertise and competency. A bureaucracy offers lifetime employment and the right division of labor lets employees improve their expertise in a given field. 
  12. Mayo's management theory states that employees are motivated far more by relational factors such as attention and camaraderie than by monetary rewards or environmental factors, such as lighting, humidity and more. Mayo developed a matrix to illustrate the likelihood that a given team would be successful.
  13. Hawthorne Effect Definition The Hawthorne effect is a term referring to the tendency of some people to work harder and perform better when they are participants in an experiment. Examples of the Hawthorne Effect The following are real-life examples of the Hawthorne effect in various settings: Healthcare: One study found that patients with dementia who were being treated with Ginkgo biloba showed better cognitive functioning when they received more intensive follow-ups with healthcare professionals. Patients who received minimal follow-up had less favorable outcomes.4 School: Research found that hand washing rates at a primary school increased as much as 23 percent when another person was present with the person washing their hands—in this study, being watched led to improved performance.5 Workplace: When a supervisor is watching an employee work, that employee is likely to be on their "best behavior" and work harder than they would without being watched. The Hawthorne effect occurs when a participant’s behavior changes as a result of being observed, rather than as a result of an intervention. In other words, when groups or individuals realize they are being observed, they may change their behavior. This change can be positive or negative, depending on the research context. For example, people participating in a nutrition-related experiment may improve their diet solely because they are taking part in the experiment.
  14. Modern Management Theory: The new thought of management theory was introduce in 1950s. Organizations want to adopt new techniques and methods that improve their working efficiency and also give more attention to employees and customers. Modern management theory gives more attention on the satisfaction of employees. According to this theory, employee work not only to earn money, it doesn’t mean that they work free but their main focus is different instead of earning money. They want respect and proper attention between their other employees and want some appreciation towards their working abilities, which increase their working productivity in a positive manner. This methodology encourages employees to work with more loyalty and efficiency and give maximum benefit to organization and improve its profitability. In other words, we can say that modern management theory not only focus on working setup, strategies and techniques but also pay attention on employees satisfaction area to enhance the productivity of organization.
  15. This approach is mainly focus on managerial decision making. Also known as management science approach. In this approach, all the decisions related to management are considered. Decisions should be according to need and requirement of organization which are created by management. Further three areas in this approach are: Operation research, Operation Management and Management information system. Operation research is work in gathering the all information related to specific tasks. All previous and current data related to all operations in organization is collected. And different techniques are used like query, linear programming etc. Operation Management checks all the production process; supervise all the system by suing different methods like statistical quality control, networking etc. Management information system helps to provide computerized information which helps management to make a better decision , all meaning full information helps to improve business process and working techniques. Meanwhile, this approach is focus on informative data and its maximum usage of making better decision.
  16. This approach focuses on units and its sub units. It means with great care study the every part of system. Verify the starting and ending of system boundaries. Every system is produce due to some specific reason. To accomplish any task or producing any product, a complete and improved system should be developed. A system is produced with interdependent and interlinked elements and parts to make a complete and single unit. It focus on hierarchy of subsystem which is a major part of every system. In simple words, this approach is helpful to study any system by parts and then improve the quality and efficiency of system. This approach is used in both general and specialized systems. It helps to achieve the objective of organization and also view all organization as an open system to verify each and every portion and part of system.
  17. Different problems needs different solutions and it’s the responsibility of management to study the problem and then make its solution according to requirement but not according to specified rules. Management face different problems in different situations and need a solution according to demand of problem. This approach is better than system approach. This approach is focus on behavior of one unit in environment and in specific relationship that affect the other sub unit. Managers should use contingency approach because it directly suggesting solutions according to organization designed situation. This approach is focus on practical answers of current organizational problems instead of old rules and standards.