Subject. Topic. Submitted To. Submitted By. Roll No. Class.

Strategic Management
Management Theories

Sir, Ghulam Nabi Wajahat Ali Ghulam 01 BBA 4th Morning)

Session. 2010-14

CELL # 03135592853, 03435693853

FASK
Faculty of Administrative Sciences Kotli (A.K) University of Azad Jammu & Kashmir Department of Business Administration.

PREFACE
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In this assignment I have discussed all the aspects of management theories. I tried my best to make this paper of assignment more understandable and comprehensive. I am also thankful to Sir, Ghulam Nabi that He assigned me such type of knowledgeable stuff.

ACKNOWNLEDGEMENT
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Firstly thanking to Allah Almighty who have given me spirit to complete this Assignment. Also thanking to Sir, Ghulam Nabi who entrusted me to complete this exploring task. I am also thankful to my parent whose prayers are always with me.

Sr# i. ii. iii. iv. v. vi. vii.

Topics Introduction, MANAGEMENT

Frederick Winslow Taylor Adam Smith

Page No. 5 5 6 6 7 8 8 8 9 9 10 11 13 13 14 15 16 17 17 18

Clarity of Goals, Domains and levels, Practice Limitations Arguments Against Management by Objective (MBO) (Its in the goal) viii. Management by Objectives (MBO). Peter Drucker ix. What is MBO? x. Core Concepts Xi. Managerial Focus, Main Principle, Where to use MBO, MBO by its Principles xii. MBO Strategy: Three Basic xiii. Management by Objective (MBO), Setting Objectives xiv. MBO (Figure Five Basic Steps) xv. SMART Acronym xvi. Monitor Progress xvii. Evaluate and Reward Performance xviii. A TEAM WORK OF MANAGEMENT BY OBJETIVE STEP BY STEP Xvix. AN EXAMPLE OF MBO Xvx. References

MANAGEMENT AN INTRODUCTION Management in all business and organizational activities is the act of getting people together to accomplish desired goals and objectives using available resources efficiently and effectively. Management comprises planning, organizing, staffing, leading or directing, and controlling an organization (a group of one or more people or entities) or effort for the purpose of accomplishing a
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goal. Resourcing encompasses the deployment and manipulation of human resources, financial resources, technological resources, and natural resources. Frederick Winslow Taylor Taylor was a mechanical engineer who sought to improve industrial efficiency. Taylor is regarded as the father of scientific management, and was one of the first management consultants and director of a famous firm. In Peter Drucker's description, Frederick W. Taylor was the first man in recorded history that deemed work deserving of systematic observation and study. On Taylor's 'scientific management' rests, above all, the tremendous surge of affluence in the last seventy-five years which has lifted the working masses in the developed countries well above any level recorded before, even for the well-to-do. Taylor, though the Isaac Newton (or perhaps the Archimedes) of the science of work, laid only first foundations, however. Not much has been added to them since even though he has been dead all of sixty years. Taylor's scientific management consisted of four principles: 1. Replace rule-of-thumb work methods with methods based on a scientific study of the tasks. 2. Scientifically select, train, and develop each employee rather than passively leaving them to train themselves. 3. Provide "Detailed instruction and supervision of each worker in the performance of that worker's discrete task" (Montgomery 1997: 250). 4. Divide work nearly equally between managers and workers, so that the managers apply scientific management principles to planning the work and the workers actually perform the tasks. Taylor thought that by analyzing work, the "One Best Way" to do it would be found. He is most remembered for developing the stopwatch time study, which combined with Frank Gilbreth's motion study methods later becomes the field of time and motion study. He would break a job into its component parts and measure each to the hundredth of a minute. One of his most famous studies involved shovels. He noticed that workers used the same shovel for all materials. He determined that the most effective load was 21 lb, and found or designed shovels that for each material would scoop up that amount. He was generally unsuccessful in getting his concepts applied and was dismissed from Bethlehem Steel. Nevertheless, Taylor was able to convince workers who used shovels and whose compensation was tied to how much they produced to adopt his advice about the
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optimum way to shovel by breaking the movements down into their component elements and recommending better ways to perform these movements. It was largely through the efforts of his disciples (most notably H.L. Gantt) that industry came to implement his ideas. Moreover, the book he wrote after parting company with Steel, Shop Management, sold well. Adam Smith Father of Political Economics & Enlightened Self-Interest (1723-1790) "There is no art which one government sooner learns of another than that of draining money from the pockets of the people." (Adam Smith)

Adam Smith was a Scottish philosopher and a political economist. He is a major contributor to the modern perception of free market economics. He is known primarily as the author of two treatises: The Theory of Moral Sentiments (1759), and An Inquiry into the Nature and Causes of the Wealth of Nations (1776). His work helped to build the foundation of the modern academic discipline of free market economics and provided one of the best-known intellectual rationales for free trade, capitalism, and libertarianism. KeyWork Adam Smith's book entitled "An Inquiry into the Nature and Causes of the Wealth of Nations" also known as "The Wealth of Nations" is considered by many as the philosophical basis of U.S. economy. Its main key points are as follows Human society is subject to immutable natural moral and physical laws. If natural laws are left to work freely, they would create the best possible society Natural law = "law of labor." All men should have the right to carry out activities to preserve their existence Government should promote the supreme value of individual liberty. The pursuit of self-interest is ultimately beneficial for society as a whole. Enlightened selfinterest eventually becomes public interests Government's only role should be to promote the existence of natural law, and to enable its free working. (Free Market) A Free market is a customer-driven, democratic mechanism through which, by exercising their free choices about purchase or sale prices, people would act to regulate resources fairly. The economic benefits of the Division of Labor (Specialization) of individuals in production International commerce importers and exporters is a source of wealth for both buyers and sellers.

Adam Smith is not a proponent of "the law of the jungle" as an approach to social organization. He recognized the nature's worst tendencies of greed, corruption and abuse of power by some businessmen who "love to reap where they never sowed". He also supports some forms of government intervention in public areas such as defense.
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Human Relations Movement - Hawthorne Works Experiments The Hawthorne Studies started in the early 1920's as an attempt to determine the effects of lighting on worker productivity. When those experiments showed no clear correlation between light level and productivity the experiments then started looking at other factors. Working with a group of women, the experimenters made a number of changes, rest breaks, no rest breaks, free meals, no free meals, and more hours in the work-day / work-week, fewer hours in the work-day / work-week. Their productivity went up at each change. Finally the women were put back to their original hours and conditions, and they set a productivity record. This strongly disproved Taylor's beliefs in three ways. First, the experimenters determined that the women had become a team and that the social dynamics of the team were a stronger force on productivity than doing things "the one best way." Second, the women would vary their work methods to avoid boredom without harming overall productivity. Finally the group was not strongly supervised by management, but instead had a great deal of freedom. These results made it clear that the group dynamics and social makeup of an organization were an extremely important force either for or against higher productivity. This caused the call for greater participation for the workers, greater trust and openness in the working environment and a greater attention to teams and groups in the work place. The human relations movement that stemmed from Mayo's Hawthorne Works Experiments was borne in a time of significant change. The Newtonian science that supported "the one best way" of doing things was being strongly challenged by the "new physics" results of Michelson, Rutherford and Einstein. Suddenly, even in the realm of "hard science" uncertainty and variation had found a place. In the work place there were strong pressures for shorter hours and employee stock ownership. As the effects of the 1929 stock market crash and following depression were felt, employee unions started to form. While Taylor's impacts were the establishment of the industrial engineering, quality control and personnel departments, the human relations movement's greatest impact came in what the organization's leadership and personnel department were doing. The seemingly new concepts of "group dynamics", "teamwork" and organizational "social systems" all stem from Mayo's work in the mid-1920. Max Weber Bureaucracy Viewing the growth of large-scale organizations of all types during the late nineteenth and early twentieth centuries, Weber developed a set of principles for an "ideal" bureaucracy. These principles included: fixed and official jurisdictional areas, a firmly ordered hierarchy of super and subordination, management based on written records, thorough and expert training, official activity taking priority over other activities and that management of a given organization follows stable, knowable rules. The bureaucracy was envisioned as a large machine for attaining its goals in the most efficient manner possible.
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Weber did not advocate bureaucracy; indeed, his writings show a strong caution for its excesses: The more fully realized, the more bureaucracy "depersonalizes" itself, i.e., the more completely it succeeds in achieving the exclusion of love, hatred, and every purely personal, especially irrational and incalculable, feeling from the execution of official tasks" or: "By it the performance of each individual worker is mathematically measured, each man becomes a little cog in the machine and aware of this, his one preoccupation is whether he can become a bigger cog." Weber, as an economist and social historian, saw his environment transitioning from older emotion and tradition driven values to technological ones. It is unclear if he saw the tremendous growth in government, military and industrial size and complexity as a result of the efficiencies of bureaucracy, or their growth driving those organizations to bureaucracy. While Weber was fundamentally an observer rather than a designer, it is clear that his predictions have come true. His principles of an ideal bureaucracy still ring true today and many of the evils of today's bureaucracies come from their deviating from those ideal principles. Unfortunately, Weber was also successful in predicting that bureaucracies would have extreme difficulties dealing with individual cases. It would have been fascinating to see how Weber would have integrated Mayo's results into his theories. It is probable that he would have seen the "group dynamics" as "noise" in the system, limiting the bureaucracy's potential for both efficiency and inhumanity.

Henri Fayol - Administration With two exceptions, Henri Fayols theories of administration dovetail nicely into the bureaucratic superstructure described by Weber. Henri Fayol focuses on the personal duties of management at a much more granular level than Weber did. While Weber laid out principles for an ideal bureaucratic organization Fayols work is more directed at the management layer. Fayol believed that management had five principle roles: to forecast and plan, to organize, to command, to co-ordinate and to control. Forecasting and planning was the act of anticipating the future and acting accordingly. Organization was the development of the institution's resources, both material and human. Commanding was keeping the institutions actions and processes running. Co8

ordination was the alignment and harmonization of the groups efforts. Finally, control meant that the above activities were performed in accordance with appropriate rules and procedures. Fayol developed fourteen principles of administration to go along with managements five primary roles. These principles are enumerated below:

Specialization/division of labor Authority with responsibility Discipline Unity of command Unity of direction Subordination of individual interest to the general interest Remuneration of staff Centralization Scalar chain/line of authority Order Equity Stability of tenure Initiative Esprit de corps

The final two principles, initiative and esprit de corps, show a difference between Fayols concept of an ideal organization and Webers. Weber predicted a completely impersonal organization with little human level interaction between its members. Fayol clearly believed personal effort and team dynamics were part of a "ideal" organization. Fayol was a successful mining engineer and senior executive prior to publishing his principles of "administrative science." It is not clear from the literature reviewed if Fayols work was precipitated or influenced by Taylors. From the timing, 1911 publication of Taylors "The Principles of Scientific Management" to Fayols work in 1916, it is possible. Fayol was not primarily a theorist, but rather a successful senior manager who sought to bring order to his personal experiences. Fayols five principle roles of management are still actively practiced today. The author has found "Plan, Organize, Command, Co-ordinate and Control" written on one than one managers whiteboard during his career. The concept of giving appropriate authority with responsibility is also widely commented on (if not well practiced.) Unfortunately his principles of "unity of command" and "unity of direction" are consistently violated in "matrix management" the structure of choice for many of todays companies. It is clear that modern organizations are strongly influenced by the theories of Taylor, Mayo, Weber and Fayol. Their precepts have become such a strong part of modern management that it is difficult to believe that these concepts were original and new at some point in history. The modern idea that these concepts are "common sense" is strong tribute to these founders.
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Theory X & Y The two theories suggest two different ways that managers view their workers. Theory X managers assume that people are naturally lazy, dislike work, and shun responsibility and so must be coerced through a system of rewards, threats, and punishments to perform their allotted task. Theory Y, however, assumes that people want to work and take on responsibility, and have an innate psychological need to do so. Work and responsibility provide not only financial but also emotional security and self-esteem, thereby satisfying many other higher-order needs than allowed by Theory X. Each theory has implications for managerial practice across a broad spectrum of organizations. Under Theory X, the four assumptions held by the manager are: Employees inherently dislike work and, whenever possible, will attempt to avoid it. Since employees dislike work, they must be coerced, controlled, or threatened with punishment to achieve goals. Employees will avoid responsibilities and seek formal direction whenever possible. Most workers place security above all other factors associated with work and will display little ambition. In contrast to these negative views about the nature of human beings, McGregor listed the four positive assumptions that he called Theory Y. Employees can view work as being as natural as rest or play. People will exercise self direction and self control if they are committed to the objectives. The average person can learn to accept, even seek, responsibility. The ability to make innovative decisions is widely dispersed throughout the population and is not necessarily the sole province of those in management positions. Motivational implications as Manger can be from Theory X and Theory Y. Theory X assumes that lower order needs dominate individuals. Theory Y assumes that high order needs dominate individuals. McGregor himself held to the belief that Theory Y assumptions are more valid than that of Theory X. Therefore he posed such ideas as participative decision making, responsible and challenging jobs, and good group relations as approaches that would maximize and employees job motivation REFRENCES
1. Accel-team.com, Elton Mayos' Hawthorne Experiments, http://www.accelteam.com/motivation/hawthorne_03.html

2. Accel-team.com, Frederick Winslow Taylor. Founder of modern scientific management

principles, http://www.accel-team.com/scientific/scientific_02.html 3. Ba 321 Henri Fayol, Retrieved September 26, 2000, http://www.eosc.osshe.edu/~blarison/mgtfayol.html 4. Elwell, Frank, 1996, Verstehen: Max Weber's HomePage, Retrieved September 26, 2000,http://www.faculty.rsu.edu/~felwell/Theorists/Weber/Whome.htm
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5. Galbraith, Jeffery, Evolution of Management Thought, Retrieved September 24,

2000, http://www.ejeff.net/HistMgt.htm
6. General Theories of Administration, Retrieved September 26,

2000,http://choo.fis.utoronto.ca/fis/courses/lis1230/lis1230sharma/history2.htm 7. Greater Washington Society of Association Executives, Peter Senge Resources, Retrieved September 26, 2000,http://www.gwsae.org/ThoughtLeaders/SengeInformation.htm 8. Halsall, Paul, 1998, Modern History Sourcebook: Frederick W. Taylor Retrieved September 27, 2000,http://www.fordham.edu/halsall/mod/1911taylor.html 9. Jarvis, Chris, Henri Fayol, Retrieved September 27, 2000, http://sol.brunel.ac.uk/~jarvis/bola/competence/fayol.html 10. Nicholson, Don, MWO: Michelson's Speed of Light Experiment, http://pinto.mtwilson.edu/Tour/24inch/Speed_of_Light/

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