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HND in Business Management Batch # 15
Organizations and Behavior
Lecture 3
Development of Management thoughts
A.Ilmudeen
Lecturer in Business Management & Computing
BCAS City Campus
Agenda
First Management Issues of Industry
Scientific Management
Taylors Four Principles of Management
Henri Fayols 14 Principles of Management
Webers Principles of Bureaucracy
The Hawthorne Studies: New Direction
Management Science Approach
Roles of Top Manager- Mintzberg
The Quantitative Approach
Development of Management thoughts 2
First Management Issues of Industry
How do we efficiently organize people at work with these new
technologies of production and large markets?
How do we hire, pay, and coordinate people at work to gain
productivity?
How do we do all of these to create economic wealth (profit)?
Development of Management thoughts 3
Scientific Management- Frederick Taylor
Frederick Taylor was called as the father of
Scientific management.
His book The Principles of Scientific management
was published in 1911. Immediately, its contents
became widely accepted by managers throughout
the world.
In scientific management the managers were
prominent while the workers' roles were denied.
"Science, not rule of thumb," said Taylor
Development of Management thoughts 4
Background of That Time
There were no clear concepts of responsibilities to workers
and managers.
No effective work standards existed.
Management decisions were based on guess and perception.
Workers were placed on jobs with little or no concern for
matching their abilities and aptitudes with the tasks required.
Managers and workers considered themselves to be in continual
conflictany gain by one would be at the expense of the other.
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Taylors Four Principles of Management
Develop a scientific way for each element of an individuals
work, which replaces the old rule-of-thumb method.
Scientifically select and then train, teach, and develop the worker.
Heartily cooperate with the workers so as to ensure that all work
is done in accordance with the scientific way that has been
developed.
Divide work and responsibility almost equally between managers
and workers. Managers take over all work for which it is better
fitted than the workers.
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Henri Fayols 14 Principles of Management
Division of Labor: allows for job specialization.
Authority and Responsibility: both formal and informal authority result
from special expertise.
Unity of Command: workers have only one boss.
Line of Authority: clear chain of command, top to bottom of the firm.
Centralization: degree to which authority rests at the top of the
organization.
Unity of Direction: single plan of action to guide the organization.
Equity - The delivery of justice, fair and impartial treatment of all
employees.
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Fayol - Continue
Order: place workers where most useful and have career opportunities.
Initiative: encourage employees to act on their own.
Discipline: workers need to obey
Remuneration of Personnel: pay what is fair.
Stability of Contract of Personnel: Long-term employment is important
Subordination of Individual Interest to the Common Interest: interest
of organization priority
Esprit de corps: Have enthusiasm
Development of Management thoughts 8
Webers Principles of Bureaucracy
Weber developed a theory of authority structures and
described organizational activity on the basis of authority
relations.
He described an ideal type of organization that called a
bureaucracy, characterized by division of labor, a clearly
defined hierarchy, detailed rules and regulations, and
impersonal relationships.
Webers Ideal Bureaucracy
Division of labor
Authority hierarchy
Formal selection
Formal rules and regulations
Impersonality
Career orientation
Development of Management thoughts 9
Mary Parker Follett
Mary Parker Follett: The Humanizing of
Management and focus on collaboration.
Taylor ignored the human side of the work,
Follett argued:
Organizations are an interdependence of people.
People have own interests but also share common
goals which should be the basis of conflict resolution.
Use of power creates conflict. People will defer
to the facts of a situation for authority.
Development of Management thoughts 10
The Hawthorne Studies: New Direction
The Hawthorne Experiments were a series of
studies into worker productivity performed at the
Cicero plant beginning in 1924 and ceasing in
1932, initially conducted by the National
Research Council and later by Western Electric
and Harvard University
Illumination Studies, 1924 -1927: Does Use of
Electric Lights Increase Productivity?
Hypothesis: Increased illumination is correlated
with higher productivity.
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Hawthorne Studies
Time: 1924the early 1930s
Place: Hawthorne plant in the Western Electric Company
Designer: Western Electric industrial engineers
Elton Mayo and his associates
Elton Mayos Finding:
Behavior and sentiments are closely related.
Group influences significantly affect individual behavior.
Group standards establish individual worker output.
Money is less a factor in determining output than are
group standards, group sentiments, and security.
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Hawthorne Experiment
Relay Assembly Test Room Experiments, 1927-1929
Harvard research team set up experiment with 5 females
from Relay Assembly area to test impact of incentives and
work conditions on worker tiredness
There is no conclusive evidence
that these affected fatigue or
productivity.
Productivity and worker
satisfaction increase when
conditions are improved and made worse.
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Management Science Approach
Scientific approach applied to decision making
Quantitative management : use of mathematic
models, linear programming, simulation systems and
chaos theory to solve management problems.
Operations management : techniques used to analyze
all aspects of the production system.
Total Quality Management (TQM) : analyzing input,
conversion, and output to increase product quality.
Management Information Systems (MIS) : provides
information vital for effective decision making
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Roles of Top Manager- Mintzberg
1. Interpersonal Roles:
Figurehead represents organization and its authority
Leader has power to make things happen
Liaison makes contacts with peers and other managers
2. Informational Roles:
Gathers and processes information
Monitor scan environment for relevant cues
Disseminator passes selected information to those who
need to know
Spokesperson informs outsiders
Development of Management thoughts 15
Roles of Top Managers Cont.
3. Decisional Roles:
Entrepreneur searches for new idea to
implement, keeps mental track of their progress
Disturbance handler tries to keep conflicts in
balance and arbitrates conflict
Resource allocator decides who gets what
(resources and power); personal basis of decision-
making
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The Quantitative Approach
The quantitative approach to management, sometimes
referred to as operations research (OR) or management science.
It includes applications of statistics, optimization models,
information models, and computer simulations, linear
programming, and so on, which can be used to solve
management problems.
How have they contributed to current management practice?
In general, the quantitative approaches have contributed directly
to management decision making, particularly to planning and
control decisions.
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1949 - Sociotechnical Systems Theory
A group of researchers from London's Tavistock Institute of Human
Relations, led by Eric Trist, studied a South Yorkshire coal mine in 1949.
Their research leads in the development of the Sociotechnical Systems
Theory which considers both the social and the technical aspects when
designing jobs.
There are four basic components to sociotechnical theory:
environment subsystem
social subsystem
technical subsystem
organizational design.
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Taylorism
It is a theory of management that analyzes and produces workflow
processes, improving labor productivity.
Taylorism, System of scientific management advocated by Fred W.
Taylor.
In Taylors view, the task of factory management was to determine
the best way for the worker to do the job, to provide the proper tools
and training, and to provide incentives for good performance.
He broke each job down into its individual motions, analyzed these
to determine which were essential, and timed the workers with a
stopwatch.
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The Systems Approach
Every system has a boundary which defines what it is: What
is inside and what is outside the system.
Anything outside the system is said to be its environment
Two basic types of the system: closed and open
In system theory, it is possible to have a closed system, which
is shut off from the environment and independent of it.
An open system is one which is connected to and interacts with
its environment.
It takes in influences from the environment and itself
influences the environment by its activities
An organization is an open system
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An Organization Is an Open System
An organization is a system that interacts with and
depends upon its environment.
Organizations stakeholders: any group that is affected by
organizational decisions and policies. The managers job is to
coordinate all stakeholders to achieve the organizations goals.
Organizational survival often depends on successful
interactions with the external environment.
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The Operating Model in Organizational
System
Input
(Capital, labor,
materials)
System
Output (Products,
Satisfied customers)
Environment
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A Timeline of Management
1932 - The Hawthorne Studies
Elton Mayo becomes the first to question the behavioral assumptions of
scientific management.
The studies concluded that human factors were often more important than
physical conditions in motivating employees to greater productivity.
1946 - Organization Development
Social scientist Kurt Lewin launches the Research Center for Group
Dynamics at the Massachusetts Institute of Technology.
His contributions in change theory, action research, and action learning
earn him the title of the "father of organization development.
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A Timeline of Management
1954 - Hierarchy of Needs
Maslow's hierarchy of needs theory is published in his book Motivation and
Personality. This provides a framework for gaining employees' commitment.
1954 - Leadership/Management
Drucker writes The Practice of Management and introduces the 5 basic roles of
managers. He writes, "The first question in discussing organization structure must be:
What is our business and what should it be? Organization structure must be designed
so as to make possible the attainment of objectives of the business for five, ten, fifteen
years hence."
1959 - Hygiene and Motivational Factors
Frederick Herzberg developed a list of factors which are closely based on Maslow's
Hierarchy of Needs, except it more closely related to work. Hygiene factors must be
present in the job before motivators can be used to stimulate the workers
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10/9/2012 Organizations and Behavior 25
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