IV. Management Yesterday, Today, Tomorrow (Web)
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Transcript of IV. Management Yesterday, Today, Tomorrow (Web)
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MANAGEMENT YESTERDAY AND TODAYMANAGEMENT YESTERDAY AND TODAY
Theories of ManagemenetTheories of Managemenet --
Rewards/Challenges ofRewards/Challenges of MModernodern MManageranager
The purpose of this lectureThe purpose of this lecture
The knowledge of management history will helpThe knowledge of management history will help
you understand contemporary management.you understand contemporary management.
It shows how the evolution of managementIt shows how the evolution of management
concepts reflect the changing needs ofconcepts reflect the changing needs of
organizations and society as a whole.organizations and society as a whole.
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Historical Background of ManagementHistorical Background of Management
Ancient ManagementAncient Management
Egypt (pyramids) and China (Great Wall)Egypt (pyramids) and China (Great Wall)Venetians (floating warship assembly lines)Venetians (floating warship assembly lines)
Adam SmithAdam Smith
PublishedPublished The Wealth of NationsThe Wealth of Nationsin 1776in 1776
Advocated the division of labor (job specialization) to increaseAdvocated the division of labor (job specialization) to increase
the productivity of workersthe productivity of workers
Industrial RevolutionIndustrial Revolution
Substituted machine power for human laborSubstituted machine power for human labor
Created large organizations in need of managementCreated large organizations in need of management
Development of Major Management TheoriesDevelopment of Major Management Theories
time
Major Approaches to ManagementMajor Approaches to Management
Scientific ManagementScientific Management
General Administrative TheoryGeneral Administrative Theory
Quantitative ManagementQuantitative Management
Organizational BehaviorOrganizational Behavior
Systems ApproachSystems Approach
Contingency ApproachContingency Approach
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Classical Management PerspectiveClassical Management Perspective
Includes bothIncludes both Scientific ManagementScientific Management (USA)(USA) -- Concerned withConcerned with
improving the performance of individual workers (i.e.,improving the performance of individual workers (i.e.,
efficiency).efficiency).
andand
GeneralGeneral AdministrativeAdministrative Theory (Europe)Theory (Europe) -- A theoryA theory
that focuses on managing the organization.that focuses on managing the organization.
Scientific ManagementScientific Management
Fredrick Winslow TaylorFredrick Winslow Taylor
TheThe fatherfather of scientific managementof scientific management
PublishedPublished Principles of Scientific ManagementPrinciples of Scientific Management(1911)(1911)
The theory of scientific managementThe theory of scientific management
Believed in selecting, training, teaching and developingBelieved in selecting, training, teaching and developing
workersworkers..
Using scientific methods to define theUsing scientific methods to define the one best wayone best way for afor a
job to be done:job to be done: Putting the right person on the job with the correct toolsPutting the right person on the job with the correct tools
and equipment.and equipment.
Having a standardized method of doing the job.Having a standardized method of doing the job.
Providing an economic incentive to the worker.Providing an economic incentive to the worker.
TaylorTaylors Four Principles of Managements Four Principles of Management
1. Develop a science for each element of an individuals work,which will replace the old rule-of-thumb method.
2. Scientifically select and then train, teach, and develop theworker.
3. Heartily cooperate with the workers so as to ensure that all
work is done in accordance with the principles of the sciencethat has been developed.
4. Divide work and responsibility almost equally betweenmanagement and workers. Management takes over all workfor which it is better fitted than the workers.
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Scientific Management (contScientific Management (contd)d)
Frank and Lillian GilbrethFrank and Lillian Gilbreth
Focused on increasing worker productivity throughFocused on increasing worker productivity throughthe reduction of wasted motionthe reduction of wasted motion
Developed the microchronometer to time workerDeveloped the microchronometer to time worker
motions and optimize work performancemotions and optimize work performance
Reduced number of movements in bricklaying,Reduced number of movements in bricklaying,
resulting in increased output of 200%resulting in increased output of 200%
Henry GanttHenry Gantt
Developed other techniques, including the GanttDeveloped other techniques, including the Gantt
chart, to improve working efficiency throughchart, to improve working efficiency through
planning/schedulingplanning/scheduling
General Administrative TheoryGeneral Administrative Theory
Henri FayolHenri Fayol
WroteWrote General and Industrial ManagementGeneral and Industrial Management
Believed that the practice of management was distinctBelieved that the practice of management was distinct
from other organizational functionsfrom other organizational functions
Developed fourteen principles of management thatDeveloped fourteen principles of management that
applied to all organizational situationsapplied to all organizational situations
First to describe management as planning,First to describe management as planning,
organizing, leading, and controllingorganizing, leading, and controlling
FayolFayols 14 Principles of Managements 14 Principles of Management
1.1. Division of workDivision of work
2.2. AuthorityAuthority
3.3. DisciplineDiscipline
4.4. Unity of commandUnity of command
5.5. Unity of directionUnity of direction
6.6. Subordination ofSubordination of
individual interestsindividual interests
to the generalto the general
interestinterest
7.7. RemunerationRemuneration
8.8. CentralizationCentralization
9.9. Scalar chainScalar chain
10.10. OrderOrder
11.11. EquityEquity
12.12. Stability of tenureStability of tenure
of personnelof personnel
13.13. InitiativeInitiative
14.14. Esprit de corpsEsprit de corps
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General Administrative TheoryGeneral Administrative Theory
Max WeberMax Weber
Developed a theory of authority based on an idealDeveloped a theory of authority based on an idealtype of organization (bureaucracy)type of organization (bureaucracy) where hewhere he
emphasized:emphasized:
division of labordivision of labor -- predictability,predictability,
reliance on rules and regulationsreliance on rules and regulations -- rationality,rationality,
impersonality,impersonality,
iinflexibility/rigiditynflexibility/rigidity
employment based on expertiseemployment based on expertise -- technical competence,technical competence,
and hierarchy of authorityand hierarchy of authority
WeberWebers Ideal Bureaucracys Ideal Bureaucracy
Classical Management PerspectiveClassical Management PerspectiveTodayToday
ContributionsContributions
Laid the foundation for later developmentsLaid the foundation for later developments
Identified important management processes, functions, skillsIdentified important management processes, functions, skills
Focused attention on management as a valid subject ofFocused attention on management as a valid subject ofscientific inquiryscientific inquiry
LimitationsLimitations
More appropriate for traditional, stable, simple organizationsMore appropriate for traditional, stable, simple organizations
Prescribed universal procedures not appropriate in somePrescribed universal procedures not appropriate in some
settingssettings
In some cases, viewed employees as tools rather thanIn some cases, viewed employees as tools rather than
resourcesresources
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Quantitative Approach to ManagementQuantitative Approach to Management
Quantitative ApproachQuantitative Approach
Also calledAlso called operations researchoperations researchoror managementmanagementsciencescience
Evolved from mathematical and statistical methodsEvolved from mathematical and statistical methods
developed to solve WWII military logistics and qualitydeveloped to solve WWII military logistics and quality
control problemscontrol problems
Focuses on improving managerial decision making byFocuses on improving managerial decision making by
applying:applying:
Statistics, optimization models, information models, andStatistics, optimization models, information models, and
computer simulationscomputer simulations
Quantitative ManagementQuantitative Management PerspectivePerspectiveTodayToday
ContributionsContributions
Developed quantitative techniques to assist in decision making.Developed quantitative techniques to assist in decision making.
Application of models has increased awareness and understandingApplication of models has increased awareness and understanding ofof
complex processes and situations.complex processes and situations.
Has been useful in the planning and controlling processes.Has been useful in the planning and controlling processes.
LimitationsLimitations
Cannot fully explain or predict behavior.Cannot fully explain or predict behavior.
Mathematical sophistication may come at the expense of other skiMathematical sophistication may come at the expense of other skills.lls.
Models may require unrealistic or unfounded assumptions.Models may require unrealistic or unfounded assumptions.
Behavioral ManagementBehavioral Management PerspectivePerspective
Organizational Behavior (OB)Organizational Behavior (OB)
The study of the actions of people at work; people areThe study of the actions of people at work; people are
the most important asset of an organizationthe most important asset of an organization
Early OB AdvocatesEarly OB Advocates
Robert OwenRobert Owen
Hugo MunsterbergHugo Munsterberg
Mary Parker FollettMary Parker Follett
Chester BarnardChester Barnard
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Early Advocates of OBEarly Advocates of OB
Experimental findingsExperimental findings Productivity unexpectedly increased under imposed
adverse working conditions. The effect of incentive plans was less than expected.
Workers established informal levels of acceptable
individual output. Over-producing workers were labeled rate busters andunder-producing workers were considered chiselers.
Research conclusionResearch conclusionSocial norms, group standards and attitudes more strongly
influence individual output and work behavior than domonetary incentives.
The Hawthorne StudiesThe Hawthorne Studies
Behavioral ManagementBehavioral Management PerspectivePerspective
Human Relations MovementHuman Relations Movement
perspective that workers respond primarily to the socialperspective that workers respond primarily to the social
context of workcontext of work
Abraham MaslowAbraham Maslow
posited a hierarchy of needsposited a hierarchy of needs
Douglas McGregorDouglas McGregor
proposed Theory X and Theory Y concepts ofproposed Theory X and Theory Y concepts of
managerial beliefsmanagerial beliefs
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Hierarchy of needsHierarchy of needs
Theory X
People do not like work and
try to avoid it.
People do not like work, so
managers have to control,
direct, coerce, and threaten
employees to get them to
meet organizational goals.
People prefer to be directed,to avoid responsibility, and to
want security; they have little
ambition.
Work is a natural part ofpeoples lives.
People are internally motivatedby commitment.
People are committed to goalsto the degree they receiverewards.
People will seek and accept
responsibility. People have the capacity to be
innovative.
People are bright, but mostlyunder-utilized.
Theory Y
Behavioral Management PerspectiveBehavioral Management PerspectiveTodayToday
ContributionsContributions
Provided important insights into motivation, group dynamics, andProvided important insights into motivation, group dynamics, and otherother
interpersonal processes.interpersonal processes.
Focused managerial attention on these critical processes.Focused managerial attention on these critical processes.
Challenged the view that employees are tools and furthered the bChallenged the view that employees are tools and furthered the beliefelief
that employees are valuable resources.that employees are valuable resources.
LimitationsLimitations
Complexity of individuals makes behavior difficult to predict.Complexity of individuals makes behavior difficult to predict.
Many concepts not put to use because managers are reluctant to aMany concepts not put to use because managers are reluctant to adoptdopt
them.them.
Contemporary research findings are not often communicated toContemporary research findings are not often communicated to
practicing managers in an understandable form.practicing managers in an understandable form.
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The Systems ApproachThe Systems Approach
System DefinedSystem Defined
A set of interrelated and interdependent partsA set of interrelated and interdependent partsarranged in a manner that produces a unified whole.arranged in a manner that produces a unified whole.
Basic Types of SystemsBasic Types of Systems
Closed systemsClosed systems
Are not influenced by and do not interact with theirAre not influenced by and do not interact with their
environment (all system input and output is internal).environment (all system input and output is internal).
Open systemsOpen systems
Dynamically interact to their environments by taking in inputsDynamically interact to their environments by taking in inputs
and transforming them into outputs that are distributed intoand transforming them into outputs that are distributed into
their environments.their environments.
The Organization as an Open SystemThe Organization as an Open System
Rensis LikertRensis Likert
Exploitive authoritative system (1)Exploitive authoritative system (1)
In this type of management system the job of employees/subordinaIn this type of management system the job of employees/subordinatestes
is to abide by the decisions made by managers and those with ais to abide by the decisions made by managers and those with a
higher status than them in the organisation. The subordinates dohigher status than them in the organisation. The subordinates do notnot
participate in the decision making. The organisation is concerneparticipate in the decision making. The organisation is concernedd
simply about completing the work. The organisation will use fearsimply about completing the work. The organisation will use fear andand
threats to make sure employees complete the work set. There is nthreats to make sure employees complete the work set. There is noo
teamwork involved.teamwork involved.
Benevolent authoritative system (2)Benevolent authoritative system (2)
Just as in an exploitive authoritative system, decisions are madJust as in an exploitive authoritative system, decisions are made bye by
those at the top of the organisation and management. Howeverthose at the top of the organisation and management. However
employees are motivated through rewards (for their contribution)employees are motivated through rewards (for their contribution)
rather than fear and threats. Information may flow from subordinrather than fear and threats. Information may flow from subordinatesates
to managers but it is restricted toto managers but it is restricted to what management want to hearwhat management want to hear..
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Rensis LikertRensis Likert
Consultative system (3)Consultative system (3)
In this type of management system, subordinates are motivated byIn this type of management system, subordinates are motivated by
rewards and a degree of involvement in the decision making procerewards and a degree of involvement in the decision making process.ss.Management will constructively use their subordinates ideas andManagement will constructively use their subordinates ideas and
opinions. However involvement is incomplete and major decisionsopinions. However involvement is incomplete and major decisions areare
still made by senior management. There is a greater flow of infostill made by senior management. There is a greater flow of informationrmation
(than in a benevolent authoritative system) from subordinates to(than in a benevolent authoritative system) from subordinates to
management. Although the information from subordinate to managermanagement. Although the information from subordinate to manager isis
incomplete and euphemistic.incomplete and euphemistic.
Participative (group) system (4)Participative (group) system (4)
Management have complete confidence in their subordinates/employManagement have complete confidence in their subordinates/employees.ees.
There is lots of communication and subordinates are fully involvThere is lots of communication and subordinates are fully involved in theed in the
decision making process. Subordinates comfortably express opiniodecision making process. Subordinates comfortably express opinionsns
and there is lots of teamwork. Teams are linked together by peopand there is lots of teamwork. Teams are linked together by people, whole, who
are members of more than one team. Employees throughout theare members of more than one team. Employees throughout the
organisation feel responsible for achieving the organisationorganisation feel responsible for achieving the organisations objectives.s objectives.
Implications of the Systems ApproachImplications of the Systems Approach
Coordination of the organizationCoordination of the organizations parts iss parts is
essential for proper functioning of the entireessential for proper functioning of the entire
organization.organization.
Decisions and actions taken in one area of theDecisions and actions taken in one area of the
organization will have an effect in other areas oforganization will have an effect in other areas of
the organization.the organization.
Organizations are not selfOrganizations are not self--contained and,contained and,therefore, must adapt to changes in theirtherefore, must adapt to changes in their
external environment.external environment.
The Contingency ApproachThe Contingency Approach
Contingency Approach DefinedContingency Approach Defined
Also sometimes called theAlso sometimes called the situational approach.situational approach.
There is no one universally applicable set ofThere is no one universally applicable set of
management principles (rules) by which to managemanagement principles (rules) by which to manage
organizations.organizations.
Organizations are individually different, face differentOrganizations are individually different, face different
situations (contingency variables), and requiresituations (contingency variables), and require
different ways of managing.different ways of managing.
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Popular Contingency VariablesPopular Contingency Variables
Organization size
As size increases, so do the problems of coordination.
Routineness of task technology
Routine technologies require organizational structures,leadership styles, and control systems that differ from
those required by customized or nonroutine technologies.
Environmental uncertainty
What works best in a stable and predictable environmentmay be totally inappropriate in a rapidly changing andunpredictable environment.
Individual differences
Individuals differ in terms of their desire for growth,autonomy, tolerance of ambiguity, and expectations.
Current Trends and IssuesCurrent Trends and Issues
GlobalizationGlobalization
EthicsEthics
EE--businessbusiness
Knowledge ManagementKnowledge Management
Learning OrganizationsLearning Organizations
Current Trends and Issues (contCurrent Trends and Issues (contd)d)
GlobalizationGlobalization
Management in international organizationsManagement in international organizations
Political and cultural challenges of operating in aPolitical and cultural challenges of operating in a
global marketglobal market
Working with people from different culturesWorking with people from different cultures
Coping with anticapitalist backlashCoping with anticapitalist backlash
Movement of jobs to countries with lowMovement of jobs to countries with low--cost laborcost labor
EthicsEthics
Increased emphasis on ethics education in collegeIncreased emphasis on ethics education in college
curriculumscurriculums
Increased creation and use of codes of ethics byIncreased creation and use of codes of ethics by
businessesbusinesses
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A Process for Addressing Ethical DilemmasA Process for Addressing Ethical Dilemmas
Step 1: What is the ethical dilemma?
Step 2: Who are the affected stakeholders?
Step 3: What personal, organizational, andexternal factors are important tomy decision?
Step 4: What are possible alternatives?
Step 5: Make a decision and act on it.
Current Trends and Issues (contCurrent Trends and Issues (contd)d)
Entrepreneurship DefinedEntrepreneurship Defined
The process of starting new businesses, generally inThe process of starting new businesses, generally in
response to opportunities.response to opportunities.
Entrepreneurship processEntrepreneurship process
Pursuit of opportunitiesPursuit of opportunities
Innovation in products, services, or business methodsInnovation in products, services, or business methods
Desire for continual growth of the organizationDesire for continual growth of the organization
Current Trends and Issues (contCurrent Trends and Issues (contd)d)
EE--Business (Electronic Business)Business (Electronic Business)
The work preformed by an organization usingThe work preformed by an organization using
electronic linkages to its key constituencieselectronic linkages to its key constituencies
EE--commerce: the sales and marketing aspect of an ecommerce: the sales and marketing aspect of an e--
businessbusiness
Categories of ECategories of E--BusinessesBusinesses
EE--business enhanced organizationbusiness enhanced organization
EE--business enabled organizationbusiness enabled organization
Total eTotal e--business organizationbusiness organization
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Categories of ECategories of E--Business InvolvementBusiness Involvement
Current Trends and Issues (contCurrent Trends and Issues (contd)d)
Learning OrganizationLearning Organization
An organization that has developed the capacity toAn organization that has developed the capacity to
continuously learn, adapt, and change.continuously learn, adapt, and change.
Knowledge ManagementKnowledge Management
The cultivation of a learning culture whereThe cultivation of a learning culture where
organizational members systematically gather andorganizational members systematically gather and
share knowledge with others in order to achieveshare knowledge with others in order to achieve
better performance.better performance.
Learning Organization versus Traditional OrganizationLearning Organization versus Traditional Organization
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Terms to KnowTerms to Know
division of labor (or jobdivision of labor (or job
specialization)specialization)
scientific managementscientific management
general administrative theorygeneral administrative theory
principles of managementprinciples of management
bureaucracybureaucracy
quantitative approachquantitative approach
organizational behavior (OB)organizational behavior (OB)
Hawthorne StudiesHawthorne Studies
systemsystem
closed systemsclosed systems
open systemsopen systems
contingency approachcontingency approach
entrepreneurshipentrepreneurship
ee--business (electronicbusiness (electronic
business)business)
ee--commerce (electroniccommerce (electronic
commerce)commerce)
intranetintranet
learning organizationlearning organization
knowledge managementknowledge management