Management Theories


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Management Theories

  1. 1. Theories of Management By: Hazel Melanie A. Tan
  2. 2. Management Theories  A collection of ideas which set forth general rules on how to manage a business or organization. Management theory addresses how managers and supervisors relate to their organizations in the knowledge of its goals, the implementation of effective means to get the goals accomplished and how to motivate employees to perform to the highest standard.
  3. 3. Different Management Theory  Focuses on empowerment of the individual workers as the source of control, motivation and productivity organizing
  4. 4. A. Motivation Theories  They help explain why people act the way they do.  Motivation is a complex phenomenon. Several theories attempt to explain how motivation works. In management circles, probably the most popular explanations of motivation are based on the needs of the individual.
  5. 5. 1. Taylor’s Monistic Theory  Is derived from the principles of scientific management.  Believes that if energetic people with high productivity learn that they earn no mote than a lazy worker who does as little as possible, they will lose interest in giving optimal performance.
  6. 6. 2. Maslow’s Hierarchy of Needs  Abraham Maslow maintained that people are motivated by a desire to satisfy a hierarchy of needs.
  7. 7. 3. Alderfer’s Modified Need Hierarchy  By Clayton Alderfer, Existence relatedness-growth theory
  8. 8. 4. McClelland’s Basic Needs Theory  By David McClelland that identified 3 basic needs.
  9. 9. 5. Herzberg Hygiene Theory  By Frederick Herzberg found that work motivators include;
  10. 10. 6. Argyris Psychological Energy Theory  Chris Argyris believes that people will exert more effort and energy to meet their own needs than those of the organization.  According to Argyris, following bureaucratic or pyramidal values leads to poor, shallow, and mistrustful relationships. Because these relationships do not permit the natural and free expression of feelings, they are phony or non-authentic and result in decreased interpersonal competence. "Without interpersonal competence or a 'psychologically safe' environment, the organization is a breeding ground for mistrust, intergroup conflict, rigidity, and so on, which in turn lead to a decrease in organizational success in problem solving."
  11. 11. 7. Vroom’s Expectancy Theory  Victor Vroom popularized the expectancy theory which states that motivation is dependent on how much people want something and their estimate of the probability of getting it.
  12. 12. 8. Skinner’s Positive Reinforcement Theory  B.F Skinner’s believe that behavior may be strengthened or weakened depending on what follows it.
  13. 13. 9. Douglas Mcgregor  Formulated 2 contrasting sets of assumption
  14. 14. 10. Theory Z  From Willian Ouchi a japanese, theory z is a form of participatory management.  Loyalty is the most important focus and a long term employment that involves slower promotions and less direct supervision
  15. 15. B. Scientific Management Theories  Used on the concepts of planning of works to achieve efficiency, standardization, specialization and simplification.
  16. 16. 1. Frederick Taylor  Scientific management technique has been employed to increase productivity and efficiency both in private and public services, it has also had the disadvantages of ignoring many of the human aspects of employment. This led to the creation of boring repetitive jobs with the introduction of systems for tight control and the alienation of shop floor employees from their managers.
  17. 17.  For the managers, scientific management required them to: 1. Develop a science for each operation to replace opinion and rule of thumb. 2. Determine accurately from the science the correct time and methods for each job (time and motion studies). 3. Set up a suitable organization to take all responsibility from the workers except that of the actual job performance. 4. Select and train the workers (in the manner described above). 5. Accept that management itself be governed by the science deployed for each operation and surrender its arbitrary powers over the workers, i.e. cooperate with them.  For the workers, scientific management required them to: 1. Stop worrying about the divisions of the fruits of production between wages and profits. 2. Share in the prosperity of the firm by working in the correct way and receiving wage increases. 3. Give up their idea of time wasting and co-operate with the management in developing the science. 4. Accept that management would be responsible for determining what was done and how. 5. Agree to be trained in new methods where applicable.
  18. 18. 2. Henry Gantt  Gantt charts, and their modern equivalent, program evaluation and review technique (PERT) charts are graphic management tools, providing visual methods of scheduling both time and resources for work projects. Henry Gantt management theory incorporates the record of the work that has been done, balanced with the work that still needs to be completed.
  19. 19. Gantt Chart
  20. 20. 3. Gilbreth, Frank and Lillian  Pioneer in time and motion studies by the use of motion-picture films.  Developed the flow diagram and process chart of work and written instruction.
  21. 21. C. Bureaucratic Theories  Focus on superior subordinate communication transmitted from the top to bottom via a clear chain of command, a hierarchy of authority and a division of labor chain  Uses rational and impersonal management.
  22. 22. 1. Max Weber  Weber identified three basic types of legitimate authority: Traditional, Charismatic, Rational-Legal. Authority has to be distinguished from power in this discussion. Power is a unilateral thing - it enables a person to force another to behave in a certain way, whether by means of strength or by rewards. Authority, on the other hand, implies acceptance of the rules by those over whom it is to be exercised within limits agreeable to the subordinates that Weber refers to in discussing legitimate authority.
  23. 23.  Weber presented three types of legitimate authority: Traditional authority: where acceptance of those in authority arose from tradition and custom. Charismatic authority: where acceptance arises from loyalty to, and confidence in, the personal qualities of the ruler. Rational-legal authority: where acceptance arises out of the office, or position, of the person in authority as bounded by the rules and procedures of the organization.  It is the rational-legal authority form that exists in most organizations today and this is the form to which Weber ascribed the term 'bureaucracy'. The main features of bureaucracy according to Weber were:  a continuous organization or functions bounded by rules  that individuals functioned within the limits of the specialization of the work, the degree of authority allocated and the rules governing the exercise of authority  a hierarchical structure of offices  appointment to offices made on the grounds of technical competence only  the separation of officials from the ownership of the organization  the authority was vested in the official positions and not in the personalities that held these posts. Rules, decisions and actions were formulated and recorded in writing.
  24. 24. D. Administration Management Theory  Refer to accomplishment of tasks and include principles of management and concepts of line and staff committees and function of management.  Focus on the science of management and principles of an organization applicable in any setting.
  25. 25. 1. Henry Fayol  Fayol's "14 Principles" was one of the earliest theories of management to be created, and remains one of the most comprehensive. He's considered to be among the most influential contributors to the modern concept of management, even though people don't refer to "The 14 Principles" often today.  The theory falls under the Administrative Management school of thought (as opposed to the Scientific Management school, led by Fredrick Taylor).
  26. 26.               Division of Work – When employees are specialized, output can increase because they become increasingly skilled and efficient. Authority – Managers must have the authority to give orders, but they must also keep in mind that with authority comes responsibility. Discipline – Discipline must be upheld in organizations, but methods for doing so can vary. Unity of Command – Employees should have only one direct supervisor. Unity of Direction – Teams with the same objective should be working under the direction of one manager, using one plan. This will ensure that action is properly coordinated. Subordination of Individual Interests to the General Interest – The interests of one employee should not be allowed to become more important than those of the group. This includes managers. Remuneration – Employee satisfaction depends on fair remuneration for everyone. This includes financial and non-financial compensation. Centralization – This principle refers to how close employees are to the decision-making process. It is important to aim for an appropriate balance. Scalar Chain – Employees should be aware of where they stand in the organization's hierarchy, or chain of command. Order – The workplace facilities must be clean, tidy and safe for employees. Everything should have its place. Equity – Managers should be fair to staff at all times, both maintaining discipline as necessary and acting with kindness where appropriate. Stability of Tenure of Personnel – Managers should strive to minimize employee turnover. Personnel planning should be a priority. Initiative – Employees should be given the necessary level of freedom to create and carry out plans. Esprit de Corps – Organizations should strive to promote team spirit and unity.
  27. 27. E. Human Relation Management Theory  Focus on the empowerment of the individual worker as the source of control, motivation and productivity in organization.  Human relations as fitting people into work situations so as to motivate them to work together harmoniously.
  28. 28. 1. Elton Mayo  Where Classical theorists were concerned with structure and mechanics of organizations, the theorists of human relations were, understandably, concerned with the human factors.  The foci of human relations theory is on motivation, group motivation and leadership. At the centre of these foci are assumptions about relationship between employer and employee. Best summarized by Schein (1965) or Elton Mayo  they were academic, social scientists  their emphasis was on human behavior within organizations  they stated that people's needs are decisive factors in achieving an organization's effectiveness  they were descriptive and attempted to be predictive of behavior in organizations A 'motive' = a need or driving force within a person. The process of motivation involves choosing between alternative forms of action in order to achieve some desired end or goal
  29. 29. 2. Willian Ouchi  Theory Z of Ouchi is Dr. William Ouchi's so-called "Japanese Management" style popularized during the Asian economic boom of the 1980s.  For Ouchi, Theory Z focused on increasing employee loyalty to the company by providing a job for life with a strong focus on the well-being of the employee, both on and off the job. According toOuchi, Theory Z management tends to promote stable employment, high productivity, and high employee morale and satisfaction.
  30. 30.  While Theory X refers to the old-fashioned, autocratic approach to management which is sometimes referred to as "hard" management and Theory Y represents a more "enlightened" and empowering management style generally thought of as "soft" management, Theory Z incorporates elements that make it an even more participative style than Theory Y. Some features of William Ouchi theory include: 1. Collective decision-making is a core tenet of Ouchi management theory. 2. Long-term employment and job security also mark William Ouchi theory. 3. Job rotation, generalization and overall understanding of company operations, replace job specialization as a key component of the model. 4. Slow advancement/promotion is another feature of William Ouchi's theory. 5. Emphasis on training and continual improvement of product and performance are common to the model. 6. Holistic concern for the worker and his or her family further personalize management in Ouchi's theory. 7. Explicit, formalized measures, despite implicit, informal control, ensure efficiency of operations. 8. Individual responsibility for shared accomplishments rounds out the theory.