Theories of Management

1. Theories of Management BOH4M

2. Theories of Management • Management may be traced back to 5000 B.C. • Management was important to the construction of the Egyptian Pyramids, rise of the Roman Empire and the commercial success of the 14th Century.

3. Classical Approaches to Management • Assumes that people are rational and driven by economic concerns • 3 branches: • Scientific management • Administrative principles • Bureaucratic organization

4. Scientific Method: Frederick Taylor • Noticed that many workers did their job without clear/uniform expectations • Believed good management needed to design jobs perfectly using “time studies” to ensure the highest productivity”

5. Scientific Method: Frederick Taylor • 4 Guiding Principles: • Every job has a science (tools, motions) • Select workers with right abilities for the job • Train workers and provide incentives • Support workers by carefully planning their work and streamlining the work process • In one study, scientific method reduced the number of motions of brick layers and tripled productivity

6. Administrative Principles: Henry Fayol • Believed management could be taught using guiding principles • Scalar Chain Principle: clear, unbroken line of communication from top to bottom of organization • Unity of Command Principle: each person should receive orders from only one boss • Unity of Direction Principle: one person should be in charge of all activities with the same performance objectives (ie accounting dept = lowering costs while marketing dept = increasing sales)

7. Administrative Principles: Henry Fayol • Identifies five duties of management including: • Foresight • Organization • Command • Coordination • Control

8. Mary Parker Follett • Viewed organizations as communities where diverse individuals should labour in harmony without dominance over one another. • Manager’s job is to help people cooperate and meet their interests. • Make every employee an owner to create collective responsibility

9. Bureaucratic Organization: Max Weber • Believed management needed a rigid, rational organization founded on logic, order and legitimate authority • Characteristics of a bureaucratic organization are: • Clear division of labour – jobs are well defined so people become highly productive doing them • Well defined levels of authority which cannot be overridden • Formal rules and procedures to direct actions and behaviour of employees • Workers are promoted based strictly on performance

10. Behavioural Approaches to Management • In the 1920s, management theorists began to take into account the human side of the workplace. Theories that evolved out of this school of thought were: • The Hawthorne Studies • Maslow’s theory of human needs • Theory X/Theory Y • Personality and organization

11. The Hawthorne Studies • “Accidental” experiment • Originally, a scientific management experiment to determine how various factors (such as lighting) would influence productivity • Results were inconclusive and researchers blamed “psychological factors” for influencing the outcome • Subsequent experiments yielded similar results… productivity increased regardless of what changes were made

12. “The Hawthorne Effect” • The tendency for people centred out for individual attention to perform as expected. • People perform differently when they know they are being observed and studied.