2011.02.cesa sustain 02

Review

Strategic Stretch

Creative Destruction

Groupthink

3 Common Mistakes of Management

Too self satisfied
Lack of Change
Underestimate Significance of Vision
3 Common Mistakes of Management

Week Two

Prof. K.B Akhilesh,
Dept. of Management Studies, IIScBangalore
“Unless you build culture, unless you build rituals, unless you build collective mindsets, it is very difficult to sustain the performance of the organization”

Book: Scott’s Three Levels of Analysis

Book: Three Focuses

High performance leading organizations are increasingly distinguished by 7 features
Management Development

Management Development

Development of Management

Frederick Taylor (1856-1915)

Elements of Scientific Management

Underlying Themes

Application in the Modern Workplace

Henri Fayol (1841-1925)

Five Elements of Management -- Managerial Objectives

Fourteen Principles of Management (Tools for Accomplishing Objectives)
Division of work - limited set of tasks
Authority and Responsibility - right to give orders
Discipline - agreements and sanctions
Unity of Command - only one supervisor
Unity of Direction - one manager per set of activities
Subordination of Individual Interest to General Interest
Remuneration of Personnel - fair price for services
Centralization - reduce importance of subordinate’s role
Scalar Chain - Fayol’sbridge
Order - effective and efficient operations
Equity - kindliness and justice
Stability of Tenure of Personnel - sufficient time for familiarity
Initiative - managers should rely on workers’ initiative
Esprit de corps - “union is strength” “loyal members”

Fourteen Principles of Management (Tools for Accomplishing Objectives)

Fayol’s Administrative Theory

Weber’s Theory of Bureaucracy
Max Weber (1864-1920)
German Sociologist
Theory of Social and Economic Organization (1947)
Principles and Elements of Management - describe an ideal or pure form of organizational structure (general policy and specific commands
PRIMARY FOCUS: Organizational Structure
Worker should respect the “right” of managers to direct activities dictated by organizational rules and procedures

Weber’s Ideal Bureaucracy
29
Exhibit 2.4
Q: Are bureaucracies alive today?

Bureaucracy allows for the optimal form of authority - “rational authority”
Three types of Legitimate Authority
Traditional Authority - past customs; personal loyalty
Charismatic Authority - personal trust in character and skills
Rational Authority - rational application of rules or laws

Tenets of Bureaucracy

Concerned with describing the ideal structure of an organization
Cornerstone: existence of written rules

The rational application of written rules ensures the promotion of legitimate authority and the effective and efficient functioning of the organization.

Application in the Modern Workplace

“Modern Times”Discussion Questions
35
What evidence did you see of Scientific Management (SM)?
What is the intention of the movie?
What evidence did you see of a bureaucracy?
What are the benefits of SM/bureaucracy?
What are the drawbacks of SM/bureaucracy?

1927-1933 WESTERN ELECTRIC CO.
Cicero, Illinois
Hawthorn Plant
Dr. Elton Mayo

Hawthorne Studies
Conducted in late 1920’s
Western Electric Hawthorne plant
Showed importance of the individual in the workplace
Showed the presence of a social system in the workplace

Hawthorne studies defined
A series of experiments in which the output of the workers was observed to increase as a result of improved treatment by their managers.
Named for their site, at the Western Electric Company plant in Hawthorne, Illinois.

Originally intended to examine effects of lighting on productivity
Scientific management proposed that physical conditions affect productivity
Result: Productivity increased regardless of lighting level
Conclusion: Increased productivity was due to workers’ receiving attention
Hawthorne Studies: Workplace Lighting

Illumination Studies
The first illumination study was made in three departments
The illumination level in each department was increased at stated intervals
Puzzling results
Increased production did not correspond with increased lighting
Reduced production did not correspond with reduced lighting

The second illumination study utilized a test group and a control group.
Illumination intensities were varied in the test group and compared to the control group.
Both groups showed increases in production rates that were not only substantial but also nearly identical.

The third illumination study reduced the lighting for the test group and held the control group constant.
Efficiency of both groups increased.
Production rates increased in the test group until the light became so poor that the workers complained.

Conclusions:
Employee output was not necessarily related to lighting conditions, and
Too many variables had not been controlled in the experiments.

Examined effects of group piecework pay system on productivity
Workers under piecework system should produce as much as possible
Scientific management assumes that people are motivated only by money
Result: Production less than maximum
Conclusion: Social pressure caused workers to produce at group-norm level
Hawthorne Studies: Piecework Pay

Elton Mayo &
Fritz Roethlisberger
ILLUMINATION STUDY
RELAY ROOM STUDY
BANK WIRING

Study Background
Hawthorne studies were conducted from 1927 to 1932 by HARVARD BUSINESS SCHOOL PROFESSOR ELTON MAYO.
Purpose of study was to EXAMINE WHAT EFFECT MONOTONY AND FATIGUE had on productivity and how to control them with variables such as rest breaks, work hours, temperature, and humidity.

Normal conditions
Under normal conditions, the work week was 48 hours, including Saturdays. There were no rest pauses.

Experiment One
The workers were put on piece-work for eight weeks.
Output went up.

Experiment Two
The workers were given two rest pauses, five minutes each, in the morning and afternoon for a period of five weeks.
Output went up again.

Experiment Three
The rest pauses were increased to ten minutes each.
Output went up sharply.

Experiment Four
The workers were given six five minute breaks.
Output fell slightly.
The workers complained that the work rhythm was broken by frequent pauses.

Experiment Five
The two original rest pauses were put back in place, and the workers were given a free hot meal by the company.
Output went up.

Experiment Six
The workers were dismissed at 4:30 p.m. instead of 5:00 p.m.
Output went up.

Experiment Seven
The workers were dismissed at 4:00 p.m.
Output remained the same.

Experiment Eight
All improvements were taken away and the workers returned to their original working conditions.
Output was the highest ever recorded!

CONCLUSION
Level of production is set by social norms, not by physical capacities
Non-economic rewards and sanctions affect the behavior of workers
Often workers react as members of a group, not as individuals
Management should recognize group behavior and act accordingly

Hawthorne Studies
Hawthorne Effect:
The phenomenon that employees perform better when they feel singled out for attention or feel that management is concerned about their welfare

A Very Brief History of Organizational Behaviour
Scientific Management
F.W. Taylor – 1890’s.
“One Best Way” to perform a task.
Management is responsible for removing obstacles that prevent “first-class” work.
Labour is responsible for becoming “first-class men”.
Systematic evaluation of work.
Labour productivity standards (piece work).
Expanded on by Gilbreth.
Human Relations Movement
Elton Mayo – 1920’s.
Western Electric (GE) Hawthorne, IL plant.
Varied illumination levels and measured output.
Varied placement and duration of breaks.
Interviewed workers about work practices.
Rather unexpected results…

In general, productivity
increased with each change
in work conditions
THE HAWTHORNE STUDIES:SOME PUZZLING RESULTS
132
124
116
Percentage of Standard Output
108
100
Standard work
conditions
Standard
Six 5-min. rests
Two 5-min. rests
Two 10-min. rests
Same + 4 p.m. stop
15-min. rests + lunch
Same + Sat. a.m. off
Same + 4:30 p.m. stop

Hawthorne Study Results
Test Room/Control Room
Changes to work conditions do not produce linear responses to productivity.
Workers appear to respond to management’s attempts to improve work place.
Bank Wiring Room
Workers will scale back productivity to suit group norm.
Organizations are social systems in which human interactions play a critical role.

Explanation of Findings
The experimental group had considerable freedom of movement compared to other workers in the plant.
The group developed an increased sense of responsibility and discipline no longer needed to come from a higher authority, it came from within the group.

Real World Example
Workers improve their productivity when they believe management is concerned with their welfare and pay particular attention to them.
Productivity can also be explained by paying attention to the workers’ social environment and informal groupings.

An Exercise
What kinds of issues affect your productivity?
What can a principal/superintendent do to increase or decrease your productivity?

Summary
Hawthorne studies defined
Study background
Explanation of findings
Real world example

Hawthorne Studies
Elton Mayo’s Study on Employee Motivation and Work Productivity

What Will Be Covered
Definition of the Hawthorne Studies
Experiment that Mayo conducted
Results
Conclusions
Brainstorming: How this can be used in organizations

What Will Be Covered Cont.
Nuts and Bolts: Explanation of topic
How it works in the field
Real World Example
Summary
References

Definition of Hawthorne Studies
“The Hawthorne Studies were conducted from 1927-1932 at the Western Electric Hawthorne Works in Chicago, where Harvard Business School Professor Elton Mayo examined productivity and work conditions.”

Definition of Hawthorne Studies Cont.
“Mayo wanted to find out what effect fatigue and monotony had on job productivity and how to control them through such variables as rest breaks, work hours, temperatures and humidity.”

Mayo’s Experiment
Five women assembled telephone relays, one supplied the parts.
Made frequent changes in working conditions with their consent.
Records were kept of relays made, temperature and humidity of rooms, medical and personal histories, eating and sleeping habits, and bits of conversation on the job.
No one supervised the girls.
They were told to work as they felt and at a comfortable pace.

Mayo’s Experiment Cont.
Productive capacity was measured by recording the girls’ output for two weeks before the study began.
First five weeks, no changes were made.
Third stage, a pay system was ensured allowing the girls’ to earn in proportion to their efforts.
Eight weeks later, two five-minute rest pauses were added.

Mayo’s Experiment Cont.
Eighth phase, workday ended a half-day early.
Ninth phase, the girls finished an hour earlier than usual.
Five-day week introduced.
Girls went back to no breaks, lunches and a full work week, output declined for those twelve weeks.

Results
Researchers found that output rates weren’t directly related to the physical conditions of the work.
Output went up when:
They were put on piece-work for eight weeks.
Two five minute rest pauses were introduced for five weeks.
Rest pauses were lengthened to ten minutes.
A hot meal was supplied during first pause.
They were dismissed at 4:30 p.m. instead of 5:00 p.m.

Results Cont.
Output slightly fell when six five minute pauses were added.
It remained the same when they were dismissed at 4:00 p.m. instead of 4:30 p.m.
Mayo believes “what actually happened was that six individuals became a team and the team gave itself wholeheartedly and spontaneously to cooperation in the experiment. The consequence was that they felt themselves to be participating freely and without afterthought, and were happy in the knowledge that they were working without coercion from above or limitations from below.”

Conclusions
Work is a group activity.
Social world for an adult is primarily patterned about work.
Need for recognition, security and sense of belonging.
Complaints, commonly a symptom manifesting disturbance of an individual’s status position.

Conclusions Cont.
Attitudes and effectiveness are conditioned by social demands.
Informal groups at work are strong social controls over the work habits and attitudes of a worker.
Change from established society to adaptive society.
Group collaboration.

Brainstorming: How this can be used in organizations
Cooperation and communication with coworkers.
Rearrange/reorganize job functions.
Create an atmosphere of working as a team.

Nuts and Bolts: Explanation of Topic
Interviewing
Provide insight to workers moral, their likes and dislikes and how they felt about their bosses.

Nuts and Bolts: Explanation of Topic Cont.
Role of Supervisor
Retained the responsibility of making sure that their workers reached production levels, should lead their workers.

Management
Need to gain active support and participation from workers, while maintaining managerial control.
Be patient with workers, listen to them, and avoid creating emotional upsets.

Teamwork
Cooperation, communication, sense of belonging.
“Man’s desire to be continuously associated in work with his fellows is a strong, if not the strongest, human characteristic. Any disregard of it by management or any ill-advised attempt to defeat this human impulse leads instantly to some form of defeat for management itself.”

How it Works in the Field
Aspects of Hawthorne Studies
Workers
Management
Motivation
Productivity

How it Works in the Field Cont.
Workers
Insights, suggestions, likes and dislikes, moral, training.
Management
Transfer of power to workers, knowing their workers.

How it Works in the Field Cont.
Motivation
Incentives to increase productivity and quality.
Productivity
By increasing the output rate and keeping costs down, the company will be able to increase profits.

Real World Example
Swedish Case
Pay system didn’t fit the structure of jobs and organization.
Two years later an incentive system was added, productivity went up 45%.

Real World Example Cont.
Swedish Case
New incentive system provided motivation through tying cooperation and teamwork.

Exercise
Brainstorm ideas that can motivate employees to increase productivity and find ways to implement them.
Think of more efficient ways in which a process can be completed and who you might go to in order to find this out.

Summary
Hawthorne Studies dealing with worker motivation and work productivity.
Increase communication and cooperation among coworkers.

Summary Cont.
Motivation can cause an increase in productivity
Involve employees in decision making.
Create a sense of belonging by creating teams.

Brainstorming Exercise
What can a manager do to improve productivity?

2011.02.cesa sustain 02

by Stephan Langdon

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