Session 2 - The Evolution of Management Thoughts PDF

MOS 1302 – Management Process and Practice Prof. K. A. S. P. Kaluarachchi, PhD Professor Department of Management and Organization Studies Faculty of Management and Finance University of Colombo...

MOS 1302 – Management Process and Practice Prof. K. A. S. P. Kaluarachchi, PhD Professor Department of Management and Organization Studies Faculty of Management and Finance University of Colombo 1 At the end of this lesson, you will be able to: ▪ Identify major forces influencing organizations and management practice ▪ Describe management perspectives over time 2 ▪ Social Forces - refer to the aspects of a culture that guide and influence relationships among people (what people value; what they need; what governs people behavior) ▪ Economic Forces – pertain to the availability, production, and distribution of resources in a society (how organizations require resources to achieve their goals; how to allocate resources to achieve the goals) ▪ Political Forces - refer to the influence of political and legal institutions on people and organizations (the role of government; government regulations; political system) 3  Classical Perspective Early Historical Trends Humanistic Perspective Quantitative/Management Science Perspective System Thinking Contingency View Recent Historical Trends Total Quality Management The Technology-Driven Workplace Open/Collaborative Innovation 4 ▪ Scientific Management (F.W. Taylor: 1856-1915) – emphasizes scientifically determined jobs and management practices to improve efficiency and labor productivity Developed standard method for performing each job Selected workers with appropriate abilities for each job Trained workers in standards methods Supported workers by planning their work and eliminating interruptions Provided wage incentives to workers for increased output 5 ▪ Bureaucratic Organizations (Max Weber: 1864-1920) – organizations that would be managed on an impersonal, rational basis Division of labor with clear authority and responsibility Positions organized in a hierarchy of authority Managers subject to rules and procedures to ensure predictable behavior Managers are separated from the owners of the organization Administrative acts and decisions recorded in writing Employees selected and promoted based on technical qualifications 6 ▪ Administrative Principles (Henri Fayol: 1841-1925) – focused on the total organization (1) Division of Labor – work specialization to produce better work with the same amount of effort (2) Authority and Responsibility – managers should have authority to carry out their responsibility (3) Discipline – respect the rules that govern organizations (4) Unity of Command – each subordinate should report to one and only one superior (5) Unity of Direction – similar activities in an organization should be grouped together under one manager (DEPARTMENTALIZATION ) (6) Subordination of Individual Interest to Organizational Interest (7) Remuneration of Staff – should be fair both to employees & to the organization 7 ▪ Administrative Principles…… (8) Centralization – authority should be concentrated at the upper levels of organization as much as possible (9) Scalar Chain – a chain of authority should extend from the top to the CHAIN OF COMMAND bottom of the organization and should be followed at all times (10) Order – both human and material resource should be coordinated so that they are in the right place at right time (11) Equity – manager should kind and fair (12) Stability of Staff – high turnover should be avoided (13) Initiative – subordinates should have the freedom to take initiatives (14) Esprit-de-Corps – team work, team sprit and sense of unit should be fostered and maintained 8 emphasized the importance of understanding human behaviors, needs, and attitudes in the workplace as well as social interactions and group processes ▪ Early Advocates Mary Parker Follett (1868-1933) - emphasis on worker participation and ***MOTHER OF MANAGEMENT - DEFINED MANAGEMENT AS AN ART of getting things done shared goals among managers; approach to leadership stressed the importance of people (empowerment) rather than engineering techniques; hence applicable for modern managers dealing with rapid changes in today’s global environment Chester I. Barnard (1886-1961) – significant contribution was the concept of informal organization which occurs in all formal organizations and include cliques and social groupings; and the acceptance theory of authority in which people have free will and choose whether to follow management orders 9 ▪ Human Relations Movement – based on the idea that truly effective control comes from within the individual worker rather than from strict, authoritarian control Evolved with the Hawthorne studies (1927-1933) which proposed that workers respond primarily to the social context of work; including social conditioning, group norms, and interpersonal dynamics; and the manager’s concern for workers would lead to increased worker satisfaction and improved worker performance 10 ▪ Human Resources Perspective – combines job design tasks with theories of motivation Abraham Maslow (1908-1970) – generalized and suggested a hierarchy of needs : physiological needs, safety needs, love and belongingness, esteem, and self-actualization needs Douglas McGregor (1906-1964) – believed that the classical XY THEORY perspective was based on Theory X assumptions about workers that assume the average worker prefers to be directed, wishes to avoid responsibility, relatively little ambitious, and wants security above all; the point of Theory Y is that organizations can take advantage of the imagination and intellect of all their employees THEORY X - BASED ON NEAGATIVE ASPECTS OF THE WORKER.THE WORKERS TRY TO SATISFY WITH BASIC 2 LEVELS OF NEED OF MASLOW 11 ▪ Behavioral Sciences Approach – uses scientific methods and draws from psychology, sociology, social-psychology, anthropology, economics, and other disciplines to develop theories about human behavior and interaction in an organizational setting One specific set of management techniques based upon the behavioral sciences approach is organizational development (OD). In the 1970s, OD evolved as a separate field that applied the behavioral sciences to improve the organization’s health and effectiveness through its ability to cope with change, improve internal relationships, and enhance problem-solving capabilities 12 provided a way to address complicated managerial problems by using the applications of mathematics, statistics, and other quantitative techniques ▪ Operations Research - consists of mathematical model building and other applications of quantitative techniques to managerial problems ▪ Operations Management - refers to the field of management that specializes in using quantitative techniques to solve manufacturing and service problems (e.g. forecasting, inventory modeling, linear and non-linear programming, queuing theory, scheduling, simulation, break-even analysis, etc.) ▪ Information Technology (IT) - is the most recent subfield of the quantitative perspective, which is reflected in management information systems that help managers estimate costs, plan and track production, manage projects, allocate resources, schedule employees, etc. 13 ▪ Systems thinking is the ability to see both the distinct elements of a system or situation and the complex and changing interaction among those elements ▪ A system is a set of interrelated parts that function as a whole to achieve a common purpose ▪ Subsystems are parts of a system, such as an organization, that depend on one another ▪ Managers need to understand the synergy of the whole organization, that means that the whole is greater than the sum of its parts 14 external 15 Assumes that each situation is believed to be unique. Principles are not universal, and one learns about management by experiencing a large number of case problem situations. Managers face the task of determining what methods will work in every new situation Case View is unique” Contingency View situation Organizational phenomena “Every exist in logical patterns Universalistic “There is Managers devise and View one best apply similarUniver uu responses way” to common problems 16 ▪ During the 1980s and 1990s, TQM focuses on managing the total organization to deliver better quality to customers ▪ The approach infuses high-quality values throughout every activity within a company, with front-line workers and the process ▪ Four significant elements of quality management are employee involvement, customer focus, benchmarking, and continuous improvement or kaizen TQM principals - managerial commitment, customer orientation, process mgt, strategic purpose, global focus TQM is an application of different quality mgt principals in an organization to improve quality in all aspects of its business with it's everyone's involvement on a continuous basis. 17 ▪ The three techniques: customer relationship management, outsourcing, and supply chain management are related to the shift to a technology-driven workplace ▪ Customer relationship management (CRM) systems use the latest IT to keep close touch with customers and to manage large amounts of customer data ▪ Outsourcing means contracting out selected functions or activities to other organizations that can do the work more cost efficiently ▪ Supply chain management (SCM) refers to managing the sequence of suppliers and purchasers, covering all stages of processing from obtaining raw materials to distributing finished goods to consumers 18 ▪ Open collaborative innovation refers to development projects in which multiple users collaborate and openly share what they develop ▪ Such projects can be at a larger scale than any single user can undertake alone ▪ It is enabled by lower collaboration costs, as people contribute for free, and lower design costs enabled by the Internet and by cost efficient computerized design tools *now companies should much concern about the sustainability practices e.g. Linux and other collaborative open source projects are developed by volunteers, and compete in scale with other software products 19 Thank you very much! 20