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OSM   – Prof. Rajesh Satpathy
Management
Theories
Administrative Management:

Henri Fayol (1841-1925) is the prominent advocate of
administrative management. He spent his entire working career
with a mining company, where he rose from an apprentice to
General Manager. As a result of his long management career, Fayol
developed fourteen management principles:

1. Division of Work- Division of work, specialization, produces
more and better work with the same effort. It focuses effort while
maximizing employee efforts. It is applicable to all work including
technical applications. There are limitations to specialization which
are determined by its application.
Management
Theories
Administrative Management:

 2. Authority and responsibility- Authority is the right to give
orders and the power to exact obedience. Distinction must be
made between a manager's official authority deriving from office
and personal authority created through individual personality,
intelligence and experience. Authority creates responsibility.

3. Discipline- Obedience and respect between a firm and its
employees based on clear and fair agreements is absolutely
essential to the functioning of any organization. Good discipline
requires managers to apply sanctions whenever violations become
apparent.
Management
Theories
Administrative Management:

4. Unity of command- An employee should receive orders from
only one superior. Employees cannot adapt to dual command.

5. Unity of direction- Organizational activities must have one
central authority and one plan of action.

6. Subordination of Individual Interest to General Interest- The
interests of one employee or group of employees are subordinate
to the interests and goals of the organization and cannot prevail
over it.
Management
Theories
Administrative Management:

7. Remuneration of Personnel- Salaries are the price of services
rendered by employees. It should be fair and provide satisfaction
both to the employee and employer. The rate of remuneration is
dependent on the value of the services rendered as determined by
the employment market.

8. Centralization- The optimum degree of centralization varies
according to the dynamics of each organization. The objective of
centralization is the best utilization of personnel.
Management
Theories
Administrative Management:

9. Scalar chain- A chain of authority exists from the highest
organizational authority to the lowest ranks. While needless
departure from the chain of command should be discouraged,
using the "gang plank" principle of direct communication between
employees can be extremely expeditious and increase the
effectiveness of organizational communication.

10. Order- Organizational order for materials and personnel is
essential. The right materials and the right employees are
necessary for each organizational function and activity.
Management
Theories
Administrative Management:

11. Equity- In organizations equity is a combination of kindliness
and justice. The desire for equity and equality of treatment are
aspirations to be taken into account in dealing with employees.

12. Stability of Tenure of Personnel- In order to attain the
maximum productivity of personnel, it is essential to maintain a
stable work force. Management insecurity produces undesirable
consequences. Generally the managerial personnel of prosperous
concerns is stable, that of unsuccessful ones is unstable.
Management
Theories
Administrative Management:

13. Initiative- Thinking out a plan and ensuring its success is an
extremely strong motivator. At all levels of the organizational
ladder zeal and energy on t he part of employees are augmented
by initiative.

14. Esprit de Corps- Teamwork is fundamentally important to an
organization. Creating work teams and using extensive face-to-face
verbal communication encourages this.
Management
Theories
The Behavioral Management School:


Behavioral management emerged in the 1920s and dealt with the
human aspects of organizations. It has been referred to as the
neoclassical school because it was initially a reaction to the
limitations of the classical approaches to management.

The Behavioral management movement began with the Hawthorne
Studies which were conducted from 1924 to 1933 at the
Hawthorne Plant of the Western Electric Company in Cicero,
Illinois.
Management
Theories

The Behavioral Management School:


Management principles developed during the classical period were
not able to deal with many management situations and explain the
behavior aspect of individual employees. It ignored the influence of
human behavior in workplaces.

The growth of behavioral school was the result of debates and
researches on behavioral aspect.
Management
Theories
The Behavioral Management School:


One prominent pioneer of the behavioral school was Elton Mayo
(1880 - 1949), an Australian psychologist who joined the Harvard
Business School faculty in 1926. The proponents of this school
explained that that increased worker satisfaction would lead to
better performance.

They established that viewing employees as just extensions of
machines is completely absurd. The human relations and social
needs of employees are very important.
Management
Theories
The Behavioral Management School:


One prominent pioneer of the behavioral school was Elton Mayo
(1880 - 1949), an Australian psychologist who joined the Harvard
Business School faculty in 1926. The proponents of this school
explained that that increased worker satisfaction would lead to
better performance.

They established that viewing employees as just extensions of
machines is completely absurd. The human relations and social
needs of employees are very important.
Management
Theories
The Human Resources Management School:


The human resources school that emerged in the early 1950s
represented a substantial advancement from the Behavioral
Management Theory.

The behavioral approach did not always increase productivity.
Thus, motivation and leadership techniques became a topic of
great interest. The human resources school advocated that
employees are very creative and competent, and their talent is
largely untapped by their employers. Employees want to work
meaningfully, contribute, and participate in decision making and
leadership functions.
Management
Theories
The Management Science School:



During World War II the United Kingdom was faced with many
complex problems. Operational research teams composed of
mathematicians, physicists & other scientists were set up. These
teams pooled their knowledge to solve problems.

After the war these ideas were applied to industrial problems
which could not be solved by conventional means. With the
development of the electronic computer, these procedures became
formalized into a ‘management science’ school.
Management
Theories

The ‘Management science’ school, by its use of computers and
quantitative analysis, has made it possible to consider the effect of
a number of variables in an organization which may otherwise have
been overlooked.

This approach to management uses precise quantitative techniques like:

>> Quantitative Management—utilizes linear programming, modeling,
simulation systems.
>> Operations Management—techniques to analyze all aspects of the
production system.
>> Total Quality Management (TQM)—focuses on improving quality throughout
an organization.
>> Management Information Systems (MIS)—provides information about the
organization.
Management
Theories

Key points:

>> Management is often described as "oldest of the arts and
youngest of sciences".
>> Industrial revolution had sown the seeds of modern
management.
>> Disagreement exists as to the exact number of management
schools.
>> The Classical Management School, The Behavioral Management
School, The Human Resources Management School and The
Management Science School are the four major schools of
management thoughts.
Thank
 You!

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Osm cl6 mgmt theories administrative

  • 1. OSM – Prof. Rajesh Satpathy
  • 2. Management Theories Administrative Management: Henri Fayol (1841-1925) is the prominent advocate of administrative management. He spent his entire working career with a mining company, where he rose from an apprentice to General Manager. As a result of his long management career, Fayol developed fourteen management principles: 1. Division of Work- Division of work, specialization, produces more and better work with the same effort. It focuses effort while maximizing employee efforts. It is applicable to all work including technical applications. There are limitations to specialization which are determined by its application.
  • 3. Management Theories Administrative Management: 2. Authority and responsibility- Authority is the right to give orders and the power to exact obedience. Distinction must be made between a manager's official authority deriving from office and personal authority created through individual personality, intelligence and experience. Authority creates responsibility. 3. Discipline- Obedience and respect between a firm and its employees based on clear and fair agreements is absolutely essential to the functioning of any organization. Good discipline requires managers to apply sanctions whenever violations become apparent.
  • 4. Management Theories Administrative Management: 4. Unity of command- An employee should receive orders from only one superior. Employees cannot adapt to dual command. 5. Unity of direction- Organizational activities must have one central authority and one plan of action. 6. Subordination of Individual Interest to General Interest- The interests of one employee or group of employees are subordinate to the interests and goals of the organization and cannot prevail over it.
  • 5. Management Theories Administrative Management: 7. Remuneration of Personnel- Salaries are the price of services rendered by employees. It should be fair and provide satisfaction both to the employee and employer. The rate of remuneration is dependent on the value of the services rendered as determined by the employment market. 8. Centralization- The optimum degree of centralization varies according to the dynamics of each organization. The objective of centralization is the best utilization of personnel.
  • 6. Management Theories Administrative Management: 9. Scalar chain- A chain of authority exists from the highest organizational authority to the lowest ranks. While needless departure from the chain of command should be discouraged, using the "gang plank" principle of direct communication between employees can be extremely expeditious and increase the effectiveness of organizational communication. 10. Order- Organizational order for materials and personnel is essential. The right materials and the right employees are necessary for each organizational function and activity.
  • 7. Management Theories Administrative Management: 11. Equity- In organizations equity is a combination of kindliness and justice. The desire for equity and equality of treatment are aspirations to be taken into account in dealing with employees. 12. Stability of Tenure of Personnel- In order to attain the maximum productivity of personnel, it is essential to maintain a stable work force. Management insecurity produces undesirable consequences. Generally the managerial personnel of prosperous concerns is stable, that of unsuccessful ones is unstable.
  • 8. Management Theories Administrative Management: 13. Initiative- Thinking out a plan and ensuring its success is an extremely strong motivator. At all levels of the organizational ladder zeal and energy on t he part of employees are augmented by initiative. 14. Esprit de Corps- Teamwork is fundamentally important to an organization. Creating work teams and using extensive face-to-face verbal communication encourages this.
  • 9. Management Theories The Behavioral Management School: Behavioral management emerged in the 1920s and dealt with the human aspects of organizations. It has been referred to as the neoclassical school because it was initially a reaction to the limitations of the classical approaches to management. The Behavioral management movement began with the Hawthorne Studies which were conducted from 1924 to 1933 at the Hawthorne Plant of the Western Electric Company in Cicero, Illinois.
  • 10. Management Theories The Behavioral Management School: Management principles developed during the classical period were not able to deal with many management situations and explain the behavior aspect of individual employees. It ignored the influence of human behavior in workplaces. The growth of behavioral school was the result of debates and researches on behavioral aspect.
  • 11. Management Theories The Behavioral Management School: One prominent pioneer of the behavioral school was Elton Mayo (1880 - 1949), an Australian psychologist who joined the Harvard Business School faculty in 1926. The proponents of this school explained that that increased worker satisfaction would lead to better performance. They established that viewing employees as just extensions of machines is completely absurd. The human relations and social needs of employees are very important.
  • 12. Management Theories The Behavioral Management School: One prominent pioneer of the behavioral school was Elton Mayo (1880 - 1949), an Australian psychologist who joined the Harvard Business School faculty in 1926. The proponents of this school explained that that increased worker satisfaction would lead to better performance. They established that viewing employees as just extensions of machines is completely absurd. The human relations and social needs of employees are very important.
  • 13. Management Theories The Human Resources Management School: The human resources school that emerged in the early 1950s represented a substantial advancement from the Behavioral Management Theory. The behavioral approach did not always increase productivity. Thus, motivation and leadership techniques became a topic of great interest. The human resources school advocated that employees are very creative and competent, and their talent is largely untapped by their employers. Employees want to work meaningfully, contribute, and participate in decision making and leadership functions.
  • 14. Management Theories The Management Science School: During World War II the United Kingdom was faced with many complex problems. Operational research teams composed of mathematicians, physicists & other scientists were set up. These teams pooled their knowledge to solve problems. After the war these ideas were applied to industrial problems which could not be solved by conventional means. With the development of the electronic computer, these procedures became formalized into a ‘management science’ school.
  • 15. Management Theories The ‘Management science’ school, by its use of computers and quantitative analysis, has made it possible to consider the effect of a number of variables in an organization which may otherwise have been overlooked. This approach to management uses precise quantitative techniques like: >> Quantitative Management—utilizes linear programming, modeling, simulation systems. >> Operations Management—techniques to analyze all aspects of the production system. >> Total Quality Management (TQM)—focuses on improving quality throughout an organization. >> Management Information Systems (MIS)—provides information about the organization.
  • 16. Management Theories Key points: >> Management is often described as "oldest of the arts and youngest of sciences". >> Industrial revolution had sown the seeds of modern management. >> Disagreement exists as to the exact number of management schools. >> The Classical Management School, The Behavioral Management School, The Human Resources Management School and The Management Science School are the four major schools of management thoughts.