Principles of mangement


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Principles of mangement

  1. 1. Principles Of Management Presented by: Eastern Warriors 1
  2. 2. This presentation would be showcasing the evolution in Management practices within an organization.The theories and approaches discussed would be as follows: The Classical approach Human Resource Approach Modern Approach 2
  3. 3. The Classical approachThe Classical perspective to managementemerged during the nineteenth century andcontinued into the twentieth century.Due to the new challenges that organizationsfaced, management sought methods ofefficiency which included a rational andscientific approach. 3
  4. 4. The Classical approachincludes the following three theories and their contributors: Scientific Management by Frederick Taylor Administrative Principle by Henry Fayol Bureaucratic Organization by Max Weber 4
  5. 5. Scientific Managementby Frederick W. Taylor1856 - 1915Scientific Management or Taylorism was a scientificmethod which was used to optimize the way in whichtasks were performed thus improving the labourproductivity. One of Taylor’s philosophy was “In thepast man must has been first. In the future, thesystem must be first.” 5
  6. 6. The General Concept of Scientific ManagementDevelop a standard method for performing a task andtrain workers to use these methods.(Managers developed precise procedures based eachorganizational task)Provide workers with the proper tools needed to work.Selected employees were chosen for specific tasks.(Workers that were stronger both mentally and physically wereassigned specific tasks)Wage incentive were provided when output wasincreased.(Employees were motivated to increase their output with the useof additional benefits 6
  7. 7. Disadvantages of Scientific ManagementWorkers felt exploited because their social aspect oflife was disregarded.(Workers were treated as machines and not humans)Management stereotyped workers and did not allowthem to prove their skills in other areas.Workers were not allowed to form innovative ways toperform their tasks. 7
  8. 8. Further contributions to Scientific Managementwere made by Henry Gantt (Gantt Chart), also Lillian M. Gilbreth (1878-1972) (IndustrialPsychology and Human Resource Management)and Frank B. Gilbreth (1868-1924) (Time and Motion Studies) 8
  9. 9. Administrative Principleby Henry Fayol1841 - 1925This theory dealt with the entire organization (bothworkers and management) which functioned with fourbasic principles. Which are: Unity of command – Each person receives order fromonly one superior. Division of work – Specialization and efficiency wereincorporated in workers. Unity of direction – Related activities were groupedunder one manager. Scalar Chain – is the organizational structure whichstarts from the CEO’s to the labourers. 9
  10. 10. Administrative Principle The five basic functions or elements of management (Management Process) are: Planning Organizing Controlling Coordinating Commanding (leading/directing) 10
  11. 11. Further contributions to Administrative Principleswere made by Mary Parker Follet (1868-1933)(emphasis was made on the common goals of theemployees in reducing organizational conflict aswell as the management gaining the trust and respectof employees) and Chester I. Bernard (18861961)(the concept of informal organization wheremanagement and subordinates group informally tocreate a bond). 11
  12. 12. Bureaucratic Organizationsby Max Weber1864 - 1920Weber’s theory concentrated on the fact thatpositions should be structured where there must bea clear line of authority (hierarchy) and all personsmust be selected by competency for the job andpromotion (promotion based on achievement and aspecialized division of labour) also, a formalstructure and position rather than an individual. 12
  13. 13. Views and Misconceptions of Bureaucratic OrganizationsGood bureaucracy removed or reduced opportunitiesfor corruption, favouritism and arbitrary exercises ofpower (instead of bribing a single official, you nowhave to bribe several officials) .Sometimes extra paperwork is added to a system.Identified bureaucracy with any large organization.Sometimes bureaucracy would be mistaken for civilservice (governmental organizations) but actually isbeing used at various types of organizations.Bureaucracy is inflexible. 13
  14. 14. Human Resource approachThe Human Resource perspective tomanagement suggested that jobs should bedesigned to meet higher levels needs byallowing workers to use their full potential. 14
  15. 15. Human Resource Approachincludes the following three theoriesand their contributors:  The Hawthorne Studies by Elton Mayo  The Maslow Theories of Human’s Need  Mc Gregor’s Theory (x y theory) 15
  16. 16. Hawthorne Studies by Elton MayoAfter a series of studies, it was proven thatemployees increase the level of output whengiven better treatment.He carried out research at the Hawthorne Worksof the Western Electric Company in Chicago.He and his team of researchers took a group ofsix women and segregated them. They thenaltered their conditions of work in a number ofways, over a five year period, and observed theeffects on production and the morale of thegroup. 16
  17. 17. From Mayo’s studies the following was derived:Over the period, changes such as new payment systems,rest breaks of different sorts and lengths, varying thelength of the working day, and offering food andrefreshments were tried. In almost all cases, productivityimproved.In the end, he realised that firstly, the women had feltimportant because they had been singled out. Secondly,the women had developed good relationships amongsteach other and had been allowed to set their own workpatterns. Thirdly, the case of relationship had made for amuch more pleasant working environment.Mayo decided that work satisfaction must depend, to alarge extent, upon the informal social relationshipsbetween workers in a group and upon the socialrelationships between workers and their bosses. 17
  18. 18. From Mayo’s investigations the following conclusions were made: Work is a group activity. The social world of an adult is primarily patterned by their work activity. The need for recognition, security and belonging is more important than physical conditions of the work environment. A complaint is commonly a symptom manifesting disturbance of an individual’s current position. An employee is a person whose attitudes and 18 effectiveness are conditioned by social demands from
  19. 19. Continued conclusions from Mayo’s investigations: Informal groups with an organization creates a strong social control over the work habits and attitudes of an individual. Groups collaboration must be planned and developed, then a cohesion within an organization would be formed thus resisting the disrupting effects of a continuously adaptive society. The change from an established society in the home to an adaptive society in the work plant resulting from the use of new techniques contribute to the disruption of the social organization of the workplace. 19
  20. 20. Maslow’s Theoryof Human’s NeedsMaslows hierarchy of needs is a theory in pyshcoloy thatcontends, each of us is motivated by needs. Our most basicneeds are inborn, having evolved over tens of thousands ofyears. Abraham Maslows Hierarchy of Needs helps toexplain how these needs motivate us all.Maslows Hierarchy of Needs states that we must satisfyeach need in turn, starting with the first, which deals withthe most obvious needs for survival itself. Only when thelower order needs of physical and emotional well-being aresatisfied are we concerned with the higher order needs ofinfluence and personal development. 20
  21. 21. Maslow’s Hierarchy of Needs Self-actualization personal growth and fulfillment Esteem needs achievement, status, responsibility, reputation Belongingness and Love needs family, affection, relationships, work group, etc Safety needs protection, security, order, law, limits, stability, etc Biological and Physiological needs basic life needs - air, food, drink, shelter, warmth, sex, sleep, etc. 21
  22. 22. Maslow said that needs must be satisfied in the givenorder. Aims and drive always shift to next higher orderneeds.Levels 1 to 4 are deficiency motivators; level 5, and byimplication 6 to 8, are growth motivators and relativelyrarely found. The thwarting of needs is usually a causeof stress, and is particularly so at level 4.Examples he used were: You cant motivate someone to achieve their salestarget (level 4) when theyre having problems withtheir marriage (level 3). You cant expect someone to work as a team member(level 3) when theyre having their house re-possessed(level 2). 22
  23. 23. Maslow’s Hierarchy of Needs Personal/ Need Occupational Social Life Hierarchy Needs Personal growth, Self fulfillment ActualizatioAdvancement n Approval, Esteem Recognition, achievement Needs high status Family, friends, Belongingness Coworkers, groups, community & Love Needs clients Protection, law, Benefits, stability Safety Needs freedom Occupational safety Proper temperature, air, Biological & PhysiologicalFood, air, water, sleep Needs basic salary 23
  24. 24. So while it is broadly true that people move up (or down) thehierarchy, depending whats happening to them in their lives,it is also true that most peoples motivational set at any timecomprises elements of all of the motivational drivers.Like any simple model, Maslows theory not a fully responsivesystem nevertheless, it remains extremely useful andapplicable for understanding, explaining and handling manyhuman behaviour situations. 24
  25. 25. Mc Gregor’s Theory (X Y Theory)In 1960 Douglas McGregor, an Americanpsychologist proposed a book “The Human SideOf Enterprise” making contrasting assumptionsabout the nature of humans in the work place.These assumptions are the basis of Theory Xand Theory Y teachings.Generally speaking, Theory X assumes thatpeople are lazy and will avoid work wheneverpossible.Theory Y, on the other hand, assumes thatpeople are creative and enjoy work. 25
  26. 26. Theory X and Theory YTheory X Theory Y The average individual The average individual dislikes work and will likes to work and it’s a avoid it. natural activity. Most people must be A person could be self forced or penalised to get motivated and is them effectively achieve committed to their work. the organizations goals. The average human The average human has learns to accept and little or no ambition, seek responsibility. would avoid responsibility Has the capacity to be but like the security and innovative and creative. benefits. The potential of a human under modern industrial life is moderately utilized. 26
  27. 27. Management Concept using Theory X and Theory YMc Gregor’s theory is a useful and simplereminder of the natural rules for managing peopleand he maintained that there are twofundamental approaches to managing people.Theory X Manager is an authoritarian managerand generally gets poor results.Theory Y Manager is a participative managerwhich produces better performance and results,and allows people to grow. 27
  28. 28. Theory X and Theory Y Management 28
  29. 29. Comparison & Contrast of Management TheoriesTheory X Theory Y Motivation style- Motivation style- Threats and disciplinary action are used more Rewarding effectively in this situation, Leadership- also monetary gain. Participative Leadership- Power & Authority- Authoritarian The manager would take Power & Authority- suggestions from workers, Arrogant, one way but would keep the power to communicator implement the decision Conflict- Conflict- Intolerant Workers might be given the Performance Appraisals- Appraisals occur on a regular opportunity to exert basis "Negotiating" strategies to solve their own differences Performance Appraisals- Promotions also occur on a regular basis. 29
  30. 30. Summary & Conclusions:With respect to overall management style, McGregorsTheory X and Theory Y managers seem to have a much moreformal leadership style and managers seem to have differentviews of the workers, while their views of the tasks remainsthe same in both cases: that is, one of specialisation, anddoing a particular task.Albeit that Theory Y suggests that the workers would becomevery good at their particular tasks, because they are free toimprove the processes and make suggestions. While theTheory X worker is said to require force, threats, and possiblyeven disciplinary action.Theory Y are, again, self motivated, this allows them to focuson the task, and also their role within the company. Theirdesire is to be more productive and enable the company tosucceed. Theory X workers, on the other hand, seem to havejust enough self motivation to show up at work, punch the 30time clock, as it were, and do only that which is necessary to
  31. 31. Modern Approach to managementElements of various perspectives, mostly thehumanistic perspective evolved into what isknown as the Modern Approach tomanagement. 31
  32. 32. Modern Approach includes the following three theories and their contributors: Open Systems Contingency Thinking Lessons from the Japanese management style (theory z) 32
  33. 33. Open SystemsA system is defined as a group of interacting units orelements that have a common purpose. Therefore Opensystems refer to systems that interact with other systems orthe outside environment.In other words organizations is an entity that takes inputsfrom the environment, transforms them, and releases themas outputs in sequence with mutual effects on theorganization itself along with the environment in which theorganization operates. 33
  34. 34. Open SystemsOpen systems refer to systems that interact with othersystems or the outside environment.For example, living organisms are considered opensystems because they take in substances from theirenvironment such as food and air and return othersubstances to their environment.The three major characteristics of open systems are: They receive inputs or energy from their environment. They convert these inputs into outputs. They discharge their outputs into their environment. 34
  35. 35. Companies use inputs such as labour, funds, equipment,and materials to produce goods or to provide services andthey design their subsystems to attain these goals. INPUT TRANSFORMATION OUTPUT Labour, Finances, Management & Production Products/Services,Material, Information Process Profit/Loss 35
  36. 36. Open SystemsTwo early pioneers in this effort, Daniel Katz and RobertKahn, began viewing organizations as open systemswith specialized and interdependent subsystems andprocesses of communication, feedback, andmanagement linking the subsystems. Katz and Kahnargued that the closed-system approach fails to takeinto account how organizations are reciprocallydependent on external environments. For example,environmental forces such as customers andcompetitors exert considerable influence oncorporations, highlighting the essential relationshipbetween an organization and its environment as well asthe importance of maintaining external inputs toachieve a stable organization. 36
  37. 37. Contingency PerspectiveThe contingency approach to management is anextension of the humanistic perspective which is basedon the idea that in an organization there is no one bestway in the management process (planning, organizing,leading, and controlling) to successfully resolve anytailored circumstances; because organizations, people,and situations vary and change over time. Thus, theright thing to do depends on a complex variety ofcritical environmental and internal contingencies. 37
  38. 38. Contingency Perspective of Management Contingency ViewUnique Situation Universal View 38
  39. 39. The contingency approach was suggested by two Americanacademics, Lawrence and Lorsch in 1967. Their importantcontribution to this approach was as follows: The more dynamic and diverse the environment, the higherthe degree of both differentiation and integration requiredfor successful organization. Less changeable environments require a lesser degree of differentiation but still require a high degree of integration. The more differentiated an organization, the more difficultit is to resolve conflict. Where the environment is uncertain, the integratingfunctions tend to be carried out by middle and low-level managerswhere the environment is stable, integration tends to beachieved at the top end of the management hierarchy. 39
  40. 40. Also, Fred Fiedler, in the 1960s and 1970s, was anearly pioneer in this area. He identified that variousaspects of the situation had an impact on theeffectiveness of different leadership styles.For example, Fiedler suggests that the degree towhich subordinates like or trust the leader, thedegree to which the task is structured, and theformal authority possessed by the leader are keydeterminants of the leadership situation. Task-oriented or relationship oriented leadership shouldwould each work if they fit the characteristics of thesituation. 40
  41. 41. Japanese Management Style Theory ZMcGregor, identified a negative set of assumptions abouthuman nature, which he called Theory X. He asserted thatthese assumptions limited the potential for growth ofmany employees.McGregor presented an alternative set of assumptions thathe called Theory Y and were more positive about humannature as it relates to employees. In McGregors view,managers who adopted Theory Y beliefs would exhibitdifferent, more humanistic, and ultimately more effectivemanagement styles and Theory Y became a well-knownprescription for improving management practices.Concerns about the competitiveness of U. S. companiesled some to examine Japanese management practices forclues to the success enjoyed by many of their industries.This led to many articles and books purporting to explainthe success of Japanese companies. It was in this 41atmosphere that Theory Z was introduced into the
  42. 42. Theory Z is humanistic approach to managementapproach by William Ouchi.The key features of Japanese industrial organizations,according to Ouchi are as follows: Offer lifetime employment (at least for their coreworkers). Promote from within. Insist on mandatory retirement of core workers at age55. Employ a large number of temporary employees mostlywomen. 42
  43. 43. The key features of Japanese industrial organizations: Career paths are non-specialized with life-long job rotation as a central feature of career development. Decision making is shared at all levels. Performance appraisal is long term (ie the first appraisal takes place 10 years after joining the company). There is a strong sense of collective responsibility for the success of the organization. And cooperation effort rather than individual achievement is encouraged. 43
  44. 44. Although Ouchi recognizes that many of the featuresof Japanese management could not be translatedinto Western industrial society, he believes thatcertain features could be applied in a Westerncontext. The move from the present hierarchicaltype of organization to a Theory Z type organizationis a process which, says Ouchi:“Has the objective of developing the ability of theorganization to coordinate people, not technology toachieve productivity.” 44
  45. 45. In his view, this requires a new philosophy ofmanaging people based on a combination of thefollowing features of Japanese management: Lifelong employment prospects Shared forms of decision-making Relationship between boss and subordinatebased on mutual respect 45
  46. 46. According to Ouchi the introduction of Theory Zapproaches into Western firms requires thefollowing strategy: Adoption of a “Top down” approach, based ondefinition of the new philosophy agreed and supported bythe organization’s top management. Implementation of the new approach should becarried through on the basis of consultation andcommunication with the workforce and with full training supportto develop relevant skills for managers, 46supervisors and their teams.