INTRODUCTION

INTRODUCTION Part includes the following topics:

 Define Management?

 Function of Managers

 Evolution of Management

 Scientific Management

o Fredrick Taylor

o Henry L. Gantt

o Frank & Lillian Gilberth

 Operational Management

o Henri Fayol

 Behavioral Science

o Munster berg

 System theory

o Chester Barnard

 Modern Management/Recent contribution to management though

o Peter F. Drucker 1974

o Edwards

o Thomas Peters & Robert Waterman 1982

Management defined

Perceptive of Managers:

There are many definitions of management but most perceptive managers are

convinced that it is an organized effort of people whose purpose is to achieve the

objectives and goals of an organization. Of course, it is not that simple. To gain a

better understanding of management, let’s review the ideas and views expressed by academicians and practitioners.

Management as a “Process”:

McFardland defines management as “A process by which managers create, direct,

maintain and operate purposive organization through systematic, coordinated, cooperative

human efforts”.

An important tern in this definition is “Process”. This term emphasis the dynamic or

on going nature of management, an activity over varying span of time. The dynamic

nature implies that change is reality of organizational life.

In managing organizations, managers create changes adopt organizations to changes

and implement changes successfully in their organizations. Businesses fail and

become bankrupt because managers fail in their attempt to cope with the change.

Management as “coordination”:

Donally, Gibson and Ivancevich also support the view of management as a process

but their stress in more on co-ordination. According to them, “Management is a

process by which individual and group effort is coordinated towards group goals”.

In order to achieve goals, coordination is essential and management involves securing

and maintaining this coordination.

This coordination effort is also stressed in the definition of Koontz and O’Donnell.

According to them, “Management is a process of designing and maintaining an

environment in which, individuals, working together in groups efficiently and

effectively accomplish group goals”.

Management as a “Function”:

There are those who view management as a function rather than a process. Dunn,

Stephens and Kelly contend that “Management is a role which includes a set of

duties, responsibilities, and relationships-involved in work organizations”.

These duties and responsibilities constitute the function a manager performs. The

duties and responsibilities a manager performs are quite different from those

performed by managerial employees.

Management is getting things done through other people:

A simple definition of management that is often quoted and it sounds very simple.

According to this definition, managers do not do things they get other people to do

things. If managing is an individual ability to get things done, then it is not a problem.

We can plan and perform things according to our own convince and interests. When

somebody else is involved and wants to get things done through them, there is a

difficulty. All sorts of problems arise; personalities come into contact and conflict.

Interpersonal problems crop up. We have to understand the behavior of other people

and must have knowledge as to how to motivate them in order to get things done

through them. We have to consider the conveniences and interest of others also in

planning and implementing things.

In getting things done through others, people have to be coaxed, they have to be

shown, they have to inspired, they have to be motivated and this is what management

means. These activities are performed not only by the people at the top but from the

chairman of the board to the front line supervisors and foremen. They use the above

mentioned methods to get things done through other people.

A comprehensive definition of Management:

In mid 1940s, academic people from various business schools in the United States

gathered together with the sole purpose of deciding whether a definition of

management could be written that businessmen would accept and practice and academicians would teach. Ultimately they came up with the fallowing definition. No

individual is identified with this definition.

The definition reads;

“Management is guiding human and physical resources into a dynamic organization

units that attain their objectives to the satisfaction of those served and with the high

degree of moral and sense of attainment on the part of those rendering the services”.

What is Management?

Introduction:

Management is a vital aspect of the economic life of man, which is an organized

group activity. A central directing and controlling agency is indispensable for a

business concern. The productive resources – material, labour, capital etc. are

entrusted to the organizing skill, administrative ability and enterprising initiative of

the management. Thus, management provides leadership to a business enterprise.

Without able managers and effective managerial leadership the resources of

production remain merely resources and never become production. Under competitive

economy and ever-changing environment the quality and performance of managers

determine both the survival as well as success of any business enterprise.

Management occupies such an important place in the modern world that the welfare

of the people and the destiny of the country are very much influenced by it.

Definition:

“Management is the process of getting things done through the efforts of other people

in order to achieve the predetermined objectives of organization”.

Management may also be define as:

“The process by which execution of given purpose put into operation and supervise”.

A concise statement:

“The function of executive leadership anywhere”.

Another statement:

Management may be defined as “A technique by which the purpose and objectives of

particular human group are determined, defined, clarified and completed”

From business Pont of view:

“Management is the art of securing maximum results with the minimum of efforts so

as to get maximum prosperity and happiness for both employer and employee and

give public the best possible service”.

Complete definition of management:

“Management is a distinct process consisting of planning, organizing, staffing,

leading and controlling utilizing both in each science and art and followed in order to

accomplish predetermined objectives of the organization”.

Entity identity

|

Management is a distinct process consisting of

|

Planning Organizing Staffing Leading Controlling

|

Applied to

Efforts of a group of people to utilize effective available recourses

|

Man Money Material Method Machine

In order to achieve predetermined objectives of an organization

Necessity of Management:

(1) Management is an essential activity of all organizational level

(Low, middle, and upper level)

(2) Management applies to:

(i) Small and large Organizations.

(ii) Profit and non profit Organization.

(iii) Manufacturing Organization.

(iv) Service rendering Organization.

Manager:

Manager is also known as leader and administrative, Manager is a person who under

take the tasks and function of managing at any level, in any kind of enterprise.

Managerial Skills:

There are four skills of managers are expected to have ability of:

(1) Technical skills:

Technical skills that reflect both an understanding of and a proficiency in a

specialized field. For example, a manager may have technical skills in accounting,

finance, engineering, manufacturing, or computer science.

Human Skills:

Human skills are skills associated with manager’s ability to work well with others,

both as a member of a group and as a leader who gets things done through other.

Concept Skills:

Conceptual skills related to the ability to visualize the organization as a whole,

discern interrelationships among organizational parts, and understand how the

organization fits into the wider context of the industry, community, and world.

Conceptual skills, coupled with technical skills, human skills and knowledge base,

are important ingredients in organizational performance.

Design Skills:

It is the ability to solve the problems in ways that will benefit the enterprise.

Managers must be able to solve the problems.

The Skills vary at different levels:

Skills of management at different levels.

The Function of Managers: There are five functions of managers: Planning, Organizing, Staffing, Leading, and Controlling. The functions of managers provide a useful structure for organizing management knowledge. (1) Planning: Planning involves selecting missions and objectives and the action to achieve them it requires decision making, that choosing future courses of action from among alternatives. There are five types of planning: 1. Missions and objectives. 2. Strategies and polices. 3. Procedures and rules. 4. Programs. 5. Budgets. (2) Organizing Organizing is the part of managing that involves establishing an intentional structure of roles for people to fill in an organization. The purpose of an organization structure is to creating an environment helpful for human performance. It is then management tools and not an end. Although the structure must define the task to be done, the rules so established must also be designed in the light of the abilities and motivations of the people available designing an effective organization structure is not an easy managerial task.Many problems arises in making structures fit situations. (3) Staffing Staffing involves filling and keeping filled, the positions in the organization. This is done by identifying the work force requirement inventorying the people available and recruiting, selecting, placing, promoting, appraising, planning the careers, compensating and training. (4) Leading Leading is influence people so that they will contribute to organization and group goals. All managers would agree that most problems arises from peoples desires and problems , their behavior as individuals and in groups and that effective managers also need to be effective leaders. Leading involves motivation, leadership styles and approaches and communications. (5) Controlling: Controlling is measuring and correcting individuals and organizational performance. It involves measuring performance against goals and plans, showing where the deviations from standards exit and helping to correct them. In short controlling facilitates the accomplishment of plans.Controll activity generally relate to the measurement of achievement. Some means of controlling like the budget for expenses, inspection, record of labors-hours lost, are generally familiar. Each shows whether plans are working out.

The Function of Managers:

There are five functions of managers: Planning, Organizing, Staffing, Leading, and Controlling. The functions of managers provide a useful structure for organizing management knowledge.

 (1) Planning: 

Planning involves selecting missions and objectives and the action to achieve them it requires decision making, that choosing future courses of action from among alternatives. There are five types of planning: 1. Missions and objectives. 2. Strategies and polices. 3. Procedures and rules. 4. Programs. 5. Budgets. 

(2)Organizing 

Organizing is the part of managing that involves establishing an intentional structure of roles for people to fill in an organization. The purpose of an organization structure is to creating an environment helpful for human performance. It is then management tools and not an end. Although the structure must define the task to be done, the rules so established must also be designed in the light of the abilities and motivations of the people available designing an effective organization structure is not an easy managerial task.Many problems arises in making structures fit situations. 

(3) Staffing 

Staffing involves filling and keeping filled, the positions in the organization. This is done by identifying the work force requirement inventorying the people available and recruiting, selecting, placing, promoting, appraising, planning the careers, compensating and training. 

(4) Leading

 Leading is influence people so that they will contribute to organization and group goals. All managers would agree that most problems arises from peoples desires and problems , their behavior as individuals and in groups and that effective managers also need to be effective leaders. Leading involves motivation, leadership styles and approaches and communications. 

(5) Controlling:

 Controlling is measuring and correcting individuals and organizational performance. It involves measuring performance against goals and plans, showing where the deviations from standards exit and helping to correct them. In short controlling facilitates the accomplishment of plans.Controll activity generally relate to the measurement of achievement. Some means of controlling like the budget for expenses, inspection, record of labors-hours lost, are generally familiar. Each shows whether plans are working out.

THE EVOLVATION OF MANAGEMENT

The origin of management can be traced back to the days when man started living in

groups. History reveals that strong men organized the masses into groups according

to their intelligence, physical and mental capabilities. Evidence of the use of the well

recognized principles of management is to be found in the organization of public life

in ancient Greece, the organization of the Roman Catholic Church and the

organization of military forces. Thus management in some form or the other has been

practiced in the various parts of the world since the dawn of civilization. With the on

set of Industrial Revolution, however, the position underwent a radical change. The

structure of industry became extremely complex. At this stage, the development of a

formal theory of management became absolutely necessary. It was against this

background that the pioneers of modern management thought laid the foundations of

modern management theory and practice.

Different Author says that history of management is different Author contribute in

management. There are so many theories of management that why also called Jungle

of management.

Different period of management:

1. Scientific Management:

(i)Fredrick Taylor.

(ii)Henry L.Gantt.

(iii)Frank and Lillian Gilberth.

2. Operational Management

(i) Henri Fayol.

3. Behavioral Science:

(i) Munster berg.

4. System Theory.

(i) Chester Barnard

5. Modern Management /Recent contribution to management thoughts.

(i) Peter F.Drucker 1974.

(ii) Edwards.

(iii) Thomas Peter & Robert Waterman.1982

1. Scientific Management:

F.W. Taylor and Henry Fayol are generally regarded as the founders of scientific

management and administrative management and both provided the bases for science

and art of management.

Features of Scientific Management:

1. It was closely associated with the industrial revolution and the rise of large-scale

enterprise.

2. Classical organization and management theory is based on contributions from a

number of sources. They are scientific management, Administrative management

theory, bureaucratic model, and micro-economics and public administration.

3. Management thought focused on job content division of labour, standardization,

simplification and specialization and scientific approach towards organization.

Taylor's Scientific Management (USA 1856-1915):

Started as an apprentice machinist in Philadelphia, USA. He rose to be the chief

engineer at the Midvale Engineering Works and later on served with

the Bethlehem Works where he experimented with his ideas and made

the contribution to the management theory for which he is so well

known. Frederick Winslow Taylor well-known as the founder of

scientific management was the first to recognize and emphasis the

need for adopting a scientific approach to the task of managing an enterprise. He tried

to diagnose the causes of low efficiency in industry and came to the conclusion that

much of waste and inefficiency is due to the lack of order and system in the methods

of management. He found that the management was usually ignorant of the amount of

work that could be done by a worker in a day as also the best method of doing the job.

As a result, it remained largely at the mercy of the workers who deliberately shirked

work. He therefore, suggested that those responsible for management should adopt a

scientific approach in their work, and make use of "scientific method" for achieving

higher efficiency. The scientific method consists essentially of

(a) Observation

(b) Measurement

(c) Experimentation and

(d) Inference.

He advocated a thorough planning of the job by the management and emphasized the

necessity of perfect understanding and co-operation between the management and the

workers both for the enlargement of profits and the use of scientific investigation and

knowledge in industrial work. He summed up his approach in these words:

 Science, not rule of thumb

 Harmony, not discord

 Co-operation, not individualism

 Maximum output, in place of restricted output

 The development of each man to his greatest efficiency and prosperity.

Elements of Scientific Management: The techniques which Taylor regarded as its

essential elements or features may be classified as under:

1. Scientific Task and Rate-setting, work improvement, etc.

2. Planning the Task.

3. Vocational Selection and Training

4. Standardization (of working conditions, material equipment etc.)

5. Specialization

6. Mental Revolution.

1. Scientific Task and Rate-Setting (work study): Work study may be defined as the

systematic, objective and critical examination of all the factors governing the

operational efficiency of any specified activity in order to effect improvement.

Work study includes.

(a) Methods Study: The management should try to ensure that the plant is laid out

in the best manner and is equipped with the best tools and machinery. The

possibilities of eliminating or combining certain operations may be studied.

(b) Motion Study: It is a study of the movement, of an operator (or even of a

machine) in performing an operation with the purpose of eliminating useless

motions.

(c) Time Study (work measurement): The basic purpose of time study is to

determine the proper time for performing the operation. Such study may be

conducted after the motion study.

Both time study and motion study help in determining the best method of doing a

job and the standard time allowed for it.

(d) Fatigue Study: If, a standard task is set without providing for measures to

eliminate fatigue, it may either be beyond the workers or the workers may over

strain themselves to attain it. It is necessary, therefore, to regulate the working

hours and provide for rest pauses at scientifically determined intervals.

(e) Rate-setting: Taylor recommended the differential piece wage system, under

which workers performing the standard task within prescribed time are paid a

much higher rate per unit than inefficient workers who are not able to come up to

the standard set.

2. Planning the Task: Having set the task which an average worker must strive to

perform to get wages at the higher piece-rate, necessary steps have to be taken to plan the production thoroughly so that there is no bottle neck and the work goes

on systematically.

3. Selection and Training: Scientific Management requires a radical change in the

methods and procedures of selecting workers. It is therefore necessary to entrust

the task of selection to a central personnel department. The procedure of selection

will also have to be systematized. Proper attention has also to be devoted to the

training of the workers in the correct methods of work.

4. Standardization: Standardization may be introduced in respect of the following.

(a) Tools and equipment: By standardization is meant the process of bringing

about uniformity. The management must select and store standard tools and

implements which will be nearly the best or the best of their kind.

(b) Speed: There is usually an optimum speed for every machine. If it is

exceeded, it is likely to result in damage to machinery.

(c) Conditions of Work: To attain standard performance, the maintenance of

standard conditions of ventilation, heating, cooling, humidity, floor space, safety

etc., is very essential.

(d) Materials: The efficiency of a worker depends on the quality of materials and

the method of handling materials.

5. Specialization: Scientific management will not be complete without the

introduction of specialization. Under this plan, the two functions of 'planning' and

'doing' are separated in the organization of the plant. The `functional foremen' are

specialists who join their heads to give thought to the planning of the performance

of operations in the workshop. Taylor suggested eight functional foremen under

his scheme of functional foremanship.

(a) The Route Clerk: To lay down the sequence of operations and instruct the

workers concerned about it.

(b) The Instruction Card Clerk: To prepare detailed instructions regarding

different aspects of work.

(c) The Time and Cost Clerk: To send all information relating to their pay to the

workers and to secure proper returns of work from them.

(d) The Shop Disciplinarian: To deal with cases of breach of discipline and

absenteeism.

(e) The Gang Boss: To assemble and set up tools and machines and to teach the

workers to make all their personal motions in the quickest and best way.

(f) The Speed Boss: To ensure that machines are run at their best speeds and

proper tools are used by the workers.

(g) The Repair Boss: To ensure that each worker keeps his machine in good order

and maintains cleanliness around him and his machines.

(h) The Inspector: To show to the worker how to do the work.

6. Mental Revolution: At present, industry is divided into two groups – management

and labour. The major problem between these two groups is the division of surplus.

The management wants the maximum possible share of the surplus as profit; the

workers want, as large share in the form of wages. Taylor has in mind the enormous

gain that arises from higher productivity. Such gains can be shared both by the

management and workers in the form of increased profits and increased wages.

Benefits of Scientific Management:

Taylor's ideas, research and recommendations brought into focus technological,

human and organizational issues in industrial management.

Benefits of Taylor's scientific management included wider scope for specialization,

accurate planning, timely delivery, standardized methods, better quality, lesser costs,

minimum wastage of materials, time and energy and cordial relations between

management and workers. According to Gilbreths, the main benefits of scientific

management are "conservation and savings, making an adequate use of every one's

energy of any type that is expended". The benefits of scientific management are:-

1. Replacement of traditional rule of thumb method by scientific techniques.

2. Proper selection and training of workers.

3. Incentive wages to the workers for higher production.

4. Elimination of wastes and rationalization of system of control.

5. Standardization of tools, equipment, materials and work methods.

6. Detailed instructions and constant guidance of the workers.

7. Establishment of harmonious relationship between the workers.

8. Better utilization of various resources.

9. Satisfaction of the needs of the customers by providing higher quality

products at lower prices.

Criticism:

1. Worker's Criticism:

(a) Speeding up of workers: Scientific Management is only a device to speed up the

workers without much regard for their health and well-being.

(b) Loss of individual worker's initiative: Scientific Management reduces workers

to automatic machine by taking away from them the function of thinking.

(c) Problem of monotony: By separating the function of planning and thinking

from that of doing, Scientific Management reduces work to mere routine.

(d) Reduction of Employment: Scientific Management creates unemployment and

hits the workers hard.

(e) Weakening of Trade Unions: Under Scientific Management, the important

issues of wages and working conditions are decided by the management through

scientific investigation and the trade unions may have little say in the matter.

(f) Exploitation of workers: Scientific Management improves productivity through

the agency of workers and yet they are given a very small share of the benefit of

such improvement.

2. Employer's Criticism:

(a) Heavy Investment: It requires too heavy an investment. The employer has to

meet the extra cost of the planning department though the foreman in this

department do not work in the workshop and directly contribute towards higher

production.

(b) Loss due to re-organization: The introduction of Scientific Management

requires a virtual reorganization of the whole set-up of the industrial unit.

Work may have to be suspended to complete such re-organization.

(c) Unsuitable for small scale firms: various measures like the establishment of a

separate personnel department and the conducting of time and motion studies are

too expensive for a small or modest size industrial unit.

Henry Lawrence Gantt (USA, 1861 - 1819):

Henry Lawrence Gantt (USA, 1861 - 1819)
Reviewed by adminon Apr 01 2013
Rating: 5

Henry Lawrence Gant was born in 1861. He graduated from John Hopkins

College. For some time, Henry Lawrence Gant worked as a draftsman in an iron

foundry.

In 1884, he qualified as a mechanical engineer at Stevens Institute.

In 1887, he joined the Midvale Steel Company. Soon, he became an

assistant to F.W Taylor. He worked with Taylor from 1887 - 1919 at Midvale Steel

Company. He did much consulting work on scientific selection of workers and the

development of incentive bonus systems. He emphasized the need for developing a

mutuality of interest between management and labor. Henry Lawrence Gant made four important

contributions to the concepts of management:

1. Gantt chart to compare actual to planned performance. Gantt chart was a daily

chart which graphically presented the process of work by showing machine

operations, man hour performance, deliveries, effected and the work in arrears.

This chart was intended to facilitate day-to-day production planning.

2. Task-and-bonus plan for remunerating workers indicating a more humanitarian

approach. This plan was aimed at providing extra wages for extra work besides

guarantee of minimum wages. Under this system of wage payment, if a worker

completes the work laid out for him, he is paid a definite bonus in addition to his

daily minimum wages. On the other hand, if a worker does not complete his work,

he is paid only his daily minimum wages. There was a provision for giving bonus to

supervisors, if workers under him were able to earn such bonus by extra work.

3. Psychology of employee relations indicating management responsibility to teach

and train workers. In his paper "Training Workmen in Habits of Industry and

Cooperation", Gantt pleaded for a policy of preaching and teaching workmen to do

their work in the process evolved through pre-thinking of management.

4. Gantt laid great emphasis on leadership. He considered management as leadership

function. He laid stress on the importance of acceptable leadership as the primary

element in the success of any business.

Gantt's contributions were more in the nature of refinements rather than fundamental

concepts. They made scientific management more humanized and meaningful to

devotees of Taylor.

Frank (USA, 1867 - 1924) and Lillian (U.S.A, 1878 - 1912):

The ideas of Taylor were also strongly supported and developed by the famous

husband and wife team of Frank and Lillian Gilbreth. They

became interested in wasted motions in work. After meeting

Taylor, they combined their ideas with Taylor's to put scientific

management into effect. They made pioneering effort in the

field of motion study and laid the entire foundation of our modern applications of job

simplification, meaningful work standards and incentive wage plans. Mrs. Gilbreth

had a unique background in psychology and management and the couple could

embark on a quest for better work methods. Frank

Gilbreth is regarded as the father of motion study. He is responsible for inculcating in

the minds of managers the questioning frame of mind and the search for a better way

of doing things.

Gilbreth's contributions to management thought are quite considerable. His main

contributions are:

(a) The one best way of doing a job is the way which involves the fewest motions

performed in an accessible area and in the most comfortable position. The best way

can be found out by the elimination of inefficient and wasteful motions involved in

the work.

(b) He emphasized that training should be given to workers from the very beginning

so that they may achieve competence as early as possible.

(c) He suggested that each worker should be considered to occupy three positions - (i)

the job he held before promotion to his present position, (ii) his present position,

and (iii) The next higher position. The part of a worker's time should be spent in

teaching the man below him and learning from the man above him. This would help

him qualify for promotion and help to provide a successor to his current job.

(d) Frank and Lillian Gilberth also gave a thought to the welfare of the individuals

who work for the organization.

(e) Gilbreth also devised methods for avoiding wasteful and unproductive

movements.

He laid down how workers should stand, how his hands should move and so on.

Operational Management/ Henri Fayol: The Father of modern operational theory.

Operational Management/ Henri Fayol: The Father of modern operational theory
Reviewed by adminon Apr 01 2013
Rating: 5

Perhaps the real father of modern management theory is the (French industrialist)

Henri Fayol. His acute observations on the Principles of general

management first appeared in 1916 in French, under the little

“administration industrielte in generale “.

This monograph, reprinted in French several times, was not translated

into English until 1929. No English translation was made or published in the US until

1949.

Industrial Activities:

Fayol found that industrial activates could be divided into six groups as shown in

figure.

1. Technical (Production)

2. Commercial (buying, Selling and exchanging).

3. Financial (Search for, and optimum use of capital).

4. Security (Protection of property and persons).

5. Accounting (including Statistics).

6. Managerial (Planning, organization, command, contribution and control).

Henri Fayol pointed out that these activities exist in

every size of business. Fayol

observed that first five were well known and he devoted most of his book to an

analysis of the sixth.

Managerial

 Planning, Organization, Staffing, Leading, Control.

Fayol’s activities in industrial undertaking:

General Principles of Management:

Fayol listed Fourteen Principles based on experience. He noting that

Principles of management are flexible, not absolute and must be usable regard less of

changing and special conditions. Some kinds of Principles appeared to be

indispensable in every undertaking.

1. Division of Work :-

Fayol applies the principle to all kind of work, management as well as technical.

2. Authority and responsibility :

Henri Fayol finds authority and responsibility to be related with the latter arising

from the former. He sees authority as a combination of official factors, manager’s

position and personal factors, “Compounded of intelligence, experience, moral

worth, past services etc.

3. Discipline :

Fayol declares that discipline requires good superiors at all levels.

4. Unity of Command:

This means that employees should receive order from one superior only.

5. Unity Of Direction:

According to this principal, each group of activities with same objective must

have one head and one plan.

6. Subordination of individuals to general interest:

When the two are found to differ, management must reconcile them.

7. Remuneration:

Remuneration and method of payment should b fair and have maximum possible

satisfaction to employees and employer.

8. Centralization:

Without using the term centralization of authority ‘’Fayol refers authority

dispersed or concentrated.

9. Scalar Chain:

Fayol thinks of this as “Chain of Superior” from beigest to low ranks should be

short circuited.

10. Order:

Fayol classify this into “material” and “social” order. This is essential principle in

arrangement of things and people in an organization.

11. Equity:

Loyalty and devotion should be elected from personnel on biases of kindliness

and justice, when dealing with subordinate.

12. Stability of tenure:

In bad management, Fayol points out id dangers and costs.

13. Initiative:

Initiative is execution of a plan.

14. Esprit decrops:

This is the principle that in the union there is strength. This principle emphasis on

work, Unity of communication. In order to accomplishment of objective.

Element of Management:

Fayol said the element of management is its functions. Planning, Organizing,

Staffing, Leading, and controlling. He point out that the principles of management

can apply not only to business but also to practical, religious, military and other

understanding.

3. Behavioral Science / Behavioral management theory:

The behavioral management theory is often called the human relations movement because

it addresses the human dimension of work. Behavioral theorists believed that a better

understanding of human behavior at work, such as motivation, conflict, expectations, and

group dynamics, improved productivity.

The theorists who contributed to this school viewed employees as individuals, resources, and

assets to be developed and worked with — not as machines, as in the past. Several

individuals and experiments contributed to this theory.

George Elton Mayo (Australia, 1880 - 1949):

George Elton Mayo (Australia, 1880 - 1949)
Reviewed by adminon Apr 01 2013
Rating: 5

Elton Mayo was born in Australia. He was educated in Logic and Philosophy at St.

Peter's College, Adelaide. He led a team of researchers from

Harvard University, which carried out investigation in human

problems.

Elton Mayo’s contributions came as part of the Hawthorne studies, a

series of experiments that rigorously applied classical management

theory only to reveal its shortcomings. The Hawthorne experiments consisted of two

studies conducted at the Hawthorne Works of the Western Electric Company in

Chicago from 1924 to 1932. The first study was conducted by a group of engineers

seeking to determine the relationship of lighting levels to worker productivity.

Surprisingly enough, they discovered that worker productivity increased as the

lighting levels decreased — that is, until the employees were unable to see what they

were doing, after which performance naturally declined.

A few years later, a second group of experiments began. Harvard researchers Mayo

and F. J. Roethlisberger supervised a group of five women in a bank wiring room.

They gave the women special privileges, such as the right to leave their workstations

without permission, take rest periods, enjoy free lunches, and have variations in pay

levels and workdays. This experiment also resulted in significantly increased rates of

productivity.

In this case, Mayo and Roethlisberger concluded that the increase in productivity

resulted from the supervisory arrangement rather than the changes in lighting or other

associated worker benefits. Because the experimenters became the primary

supervisors of the employees, the intense interest they displayed for the workers was

the basis for the increased motivation and resulting productivity. Essentially, the

experimenters became a part of the study and influenced its outcome. This is the

origin of the term Hawthorne effect, which describes the special attention researchers

give to a study’s subjects and the impact that attention has on the study’s findings.

The general conclusion from the Hawthorne studies was that human relations and the

social needs of workers are crucial aspects of business management. This principle of

human motivation helped revolutionize theories and practices of management.

Max Weber Theory of bureaucracy:

He disliked that many European organizations were managed on a “personal” familylike

basis and that employees were loyal to individual supervisors

rather than to the organization. He believed that organizations should

be managed impersonally and that a formal organizational structure,

where specific rules were followed, was important. In other words, he

didn’t think that authority should be based on a person’s personality.

He thought authority should be something that was part of a person’s job and passed

from individual to individual as one person left and another took over. This no

personal, objective form of organization was called a bureaucracy.

Weber believed that all bureaucracies have the following characteristics:

 A well-defined hierarchy. All positions within a bureaucracy are structured in a

way that permits the higher positions to supervise and control the lower positions.

This clear chain of command facilitates control and order throughout the

organization.

 Division of labor and specialization. All responsibilities in an organization are

specialized so that each employee has the necessary expertise to do a particular

task.

 Rules and regulations. Standard operating procedures govern all organizational

activities to provide certainty and facilitate coordination.

 Impersonal relationships between managers and employees. Managers should

maintain an impersonal relationship with employees so that favoritism and

personal prejudice do not influence decisions.

 Competence. Competence, not “who you know,” should be the basis for all

decisions made in hiring, job assignments, and promotions in order to foster

ability and merit as the primary characteristics of a bureaucratic organization.

 Records. A bureaucracy needs to maintain complete files regarding all its

activities.

4. System Approach:

The systems approach to management indicates the fourth major theory of

management thought called modern theory. Modern theory considers an organization

as an adaptive system which has to adjust to changes in its environment. An

organization is now defined as a structured process in which individuals interact for

attaining objectives.

Meaning of "System": The word system is derived from the Greek word meaning to

bring together or to combine. A system is a set of interconnected and inter-related

elements or component parts to achieve certain goals. A system has three significant

parts:

1. Every system is goal-oriented and it must have a purpose or objective to be

attained.

2. In designing the system we must establish the necessary arrangement of

components.

3. Inputs of information, material and energy are allocated for processing as per plan

so that the outputs can achieve the objective of the system.

Fig. The Design of a basic system

Chester Barnard (1886 – 1961):

He president of New Jersey Bell Telephone Company, introduced the idea of the

informal organization —cliques (exclusive groups of people) that

naturally form within a company. He felt that these informal

organizations provided necessary and vital communication functions for

the overall organization and that they could help the organization

accomplish its goals. Barnard felt that it was particularly important for managers to

develop a sense of common purpose where a willingness to cooperate is strongly

encouraged. He is credited with developing the acceptance theory of management,

which emphasizes the willingness of employees to accept that mangers have

legitimate authority to act. Barnard felt that four factors affected the willingness of

employees to accept authority:

 The employees must understand the communication.

 The employees accept the communication as being consistent with the

organization’s purposes.

 The employees feel that their actions will be consistent with the needs and desires

of the other employees.

 The employees feel that they are mentally and physically able to carry out the

order.

 Barnard’s sympathy for and understanding of employee needs positioned him as a

bridge to the behavioral school of management, the next school of thought to

emerge.

5. Modern Management /Recent contribution to management thoughts:

Peter Ferdinand Drucker (November 19, 1909–November 11, 2005):

He was a writer, management consultant, and self-described “social ecologist.”

Widely considered to be "the father of modern management,” his 39

books and countless scholarly and popular articles explored how

humans are organized across all sectors of society—in business,

government and the nonprofit world.

His writings have predicted many of the major developments of the late twentieth

century, including privatization and decentralization; the rise of Japan to economic

world power; the decisive importance of marketing; and the emergence of the

information society with its necessity of lifelong learning. In 1959, Drucker coined

the term “knowledge worker" and later in his life considered knowledge work

productivity to be the next frontier of management.

Basic ideas:

 Decentralization and simplification: Drucker discounted the command and control

model and asserted that companies work best when they are decentralized.

According to Drucker, corporations tend to produce too many products, hire

employees they don't need (when a better solution would be outsourcing), and

expand into economic sectors that they should avoid.

 Respect of the worker: Drucker believed that employees are assets and not

liabilities. He taught that knowledge workers are the essential ingredients of the

modern economy. Central to this philosophy is the view that people are an

organization's most valuable resource and that a manager's job is to prepare and

free people to perform.

 The need to manage business by balancing a variety of needs and goals, rather

than subordinating an institution to a single value. This concept of management

by objectives forms the keynote of his 1954 landmark "The Practice of

Management".

 A company's primary responsibility is to serve its customers. Profit is not the

primary goal, but rather an essential condition for the company's continued

existence.

 An Organization should have a proper way of executing all its business processes.

 A belief in the notion that great companies could stand among humankind's

noblest inventions.

William Edwards Deming (October 14, 1900 – December 20, 1993):

He was an American statistician, professor, author, lecturer, and consultant. Deming

is widely credited with improving production in the United States

during World War II, although he is perhaps best known for his work

in Japan. There, from 1950 onward he taught top management how to

improve design (and thus service), product quality, testing and sales

(the last through global markets) through various methods, including

the application of statistical methods.

Deming made a significant contribution to Japan's later-renown-for innovative highquality

products and its economic power. He is regarded as having had more impact

upon Japanese manufacturing and business than any other individual not of Japanese

heritage. Despite being considered something of a hero in Japan, he was only

beginning to win widespread recognition in the U.S. at the time of his death.

Deming philosophy synopsis:

The philosophy of W. Edwards Deming has been summarized as follows:

"Dr. W. Edwards Deming taught that by adopting appropriate principles of

management, organizations can increase quality and simultaneously reduce costs

(by reducing waste, rework, staff attrition and litigation while increasing

customer loyalty). The key is to practice continual improvement and think of

manufacturing as a system, not as bits and pieces."

In the 1970s, Dr. Deming's philosophy was summarized by some of his Japanese

proponents with the following 'a'-versus-'b' comparison:

(a) When people and organizations focus primarily on quality, defined by the

following ratio,

Quality = Results of work efforts

Total Cost

Quality tends to increase and costs fall over time.

(b) However, when people and organizations focus primarily on costs, costs tend to

rise and quality declines over time.

Deming's 14 points:

Deming offered fourteen key principles for management for transforming business

effectiveness. The points were first presented in his book Out of the Crisis.

1. Create constancy of purpose toward improvement of product and service, with

the aim to become competitive and stay in business, and to provide jobs.

2. Adopt the new philosophy. We are in a new economic age. Western

management must awaken to the challenge, must learn their responsibilities,

and take on leadership for change.

3. Cease dependence on inspection to achieve quality. Eliminate the need for

inspection on a mass basis by building quality into the product in the first

place.

4. End the practice of awarding business on the basis of price tag. Instead,

minimize total cost. Move towards a single supplier for any one item, on a

long-term relationship of loyalty and trust.

5. Improve constantly and forever the system of production and service, to

improve quality and productivity, and thus constantly decrease cost.

6. Institute training on the job.

7. Institute leadership. The aim of supervision should be to help people and

machines and gadgets to do a better job. Supervision of management is in

need of overhaul, as well as supervision of production workers.

8. Drive out fear, so that everyone may work effectively for the company.

9. Break down barriers between departments. People in research, design, sales,

and production must work as a team, to foresee problems of production and in

use that may be encountered with the product or service.

10. Eliminate slogans, exhortations, and targets for the work force asking for zero

defects and new levels of productivity. Such exhortations only create

adversarial relationships, as the bulk of the causes of low quality and low

productivity belong to the system and thus lie beyond the power of the work

force.

11. (a) Eliminate work standards (quotas) on the factory floor. Substitute

leadership.

(b) Eliminate management by objective. Eliminate management by numbers,

numerical goals. Substitute workmanship.

12. (a) Remove barriers that rob the hourly worker of his right to pride of

workmanship. The responsibility of supervisors must be changed from sheer

numbers to quality.

(b) Remove barriers that rob people in management and in engineering of

their right to pride of workmanship. This means, inter alia, abolishment of the

annual or merit rating and of management by objective.

13. Institute a vigorous program of education and self-improvement.

14. Put everyone in the company to work to accomplish the transformation. The

transformation is everyone's work. "Massive training is required to instill the

courage to break with tradition. Every activity and every job is a part of the

process."

In Search of Excellence Thomas Peters & Robert Waterman 1982:

“In Search of Excellence” is an international bestselling book written by Tom Peters

and Robert H. Waterman, Jr. First published in 1982 it is one of the biggest selling

and most widely read business books ever, selling 3 million copies in its first four

years, and being the most widely held library book in the United States from 1989 to

2006 (WorldCat data). The book explores the art and science of management used by leading 1980s companies with records of long-term profitability and continuing
innovation.
Peters and Waterman found eight common themes which they argued were
responsible for the success of the chosen corporations. The book devotes one chapter
to each theme.
1. A bias for action, active decision making - 'getting on with it'.
2. Close to the customer - learning from the people served by the business.
3. Autonomy and entrepreneurship - fostering innovation and nurturing
'champions'.
4. Productivity through people- treating rank and file employees as a source of
quality.
5. Hands-on, value-driven - management philosophy that guides everyday
practice - management showing its commitment.
6. Stick to the knitting - stay with the business that you know.
7. Simple form, lean staff - some of the best companies have minimal HQ staff.
8. Simultaneous loose-tight properties - autonomy in shop-floor activities plus
centralized values.