Management Theories 2 PDF

MANAGEMENT THEORIES 2 SERVICE EXCELLENCE  MANAGEMENT THEORIES Outline 2.3. Behavioural Theory  Human Relations or Neo-classical,  Behavioural theories 2.4. Modern Management Theory  Quantitative Approach  System Theory,  Contingency, Theory SERVICE EXCELLENCE 2...

MANAGEMENT THEORIES 2 SERVICE EXCELLENCE  MANAGEMENT THEORIES Outline 2.3. Behavioural Theory  Human Relations or Neo-classical,  Behavioural theories 2.4. Modern Management Theory  Quantitative Approach  System Theory,  Contingency, Theory SERVICE EXCELLENCE 2.3 Behavioral Management Theory As management research continued in the 20th century, questions began to come up regarding the interactions and motivations of the individual within organizations. Management principles which were developed during the classical period were simply not useful in dealing with many management situations and could not explain the behavior of individual employees. SERVICE EXCELLENCE Behavioral Management Theory/ Human Relations Movement It is believed classical theory ignored employee motivation and behavior. As a result, the behavioral school was a natural outgrowth of this revolutionary management experiment. The behavioral management theory is often called the human relations movement because it addresses the human dimension of work. SERVICE EXCELLENCE Behavioral Management Theory/ Human Relations Movement Behavioral theorists believed that a better understanding of human behavior at work, such as motivation, conflict, expectations, and group dynamics, improved productivity. SERVICE EXCELLENCE  Behavioral Management Theory The theorists who contributed to this school viewed employees as; Different individuals, resources, and assets to be developed and worked with them not as machines, as in the past. Several individuals and experiments contributed to this theory. SERVICE EXCELLENCE Some Contributors to the Theory Organizations as communities Mary Parker Follett Theory X and Hawthorne Theory Y studies Douglas Elton Mayo McGregor Human resource Theory of approaches Personality and human needs Assumption: organization Abraham People are social Chris Argyris Maslow and self- actualizing SERVICE EXCELLENCE  Abraham Maslow Abraham Maslow, a practicing psychologist, developed one of the most widely recognized needs theories, a theory of motivation based upon a consideration of human needs. His theory of human needs had three assumptions: 1. Human needs are never completely satisfied. 2. Human behavior is purposeful and is motivated by the need for satisfaction. 3. Needs can be classified according to a hierarchical structure of importance, from the lowest to highest. SERVICE EXCELLENCE Maslow’s Hierarchy of Needs SERVICE EXCELLENCE  Abraham Maslow 5. Self-actualization needs. Assuming that all the previous needs in the hierarchy are satisfied, an individual feels a need to find himself. Maslow’s hierarchy of needs theory helped managers visualize employee motivation. 4. Esteem needs. An individual must develop self-confidence and wants to achieve status, reputation, fame, and glory. 3. Belonging and love needs. After the physical and safety needs are satisfied and are no longer motivators, the need for belonging and love emerges as a primary motivator. The individual strives to establish meaningful relationships with significant others. 2. Safety needs. These needs include the need for basic security, stability, protection, and freedom from fear. A normal state exists for an individual to have all these needs generally satisfied. Otherwise, they become primary motivators. 1. Physiological needs. Maslow grouped all physical needs necessary for maintaining basic human well-being, such as food and drink, into this category. After the need is satisfied, however, it is no longer a motivator. SERVICE EXCELLENCE  Elton Mayo’s Elton Mayo’s contributions came as The Hawthorne experiments part of the Hawthorne studies, a consisted of two studies conducted at series of experiments that rigorously the Hawthorne Works of the Western applied classical management theory Electric Company in Chicago from only to reveal its shortcomings. 1924 to 1932. SERVICE EXCELLENCE  Hawthorne Study The first study was Surprisingly enough, they until the employees were conducted by a group of discovered that worker unable to see what they engineers seeking to productivity increased as were doing, after which determine the relationship the lighting levels performance naturally of lighting levels to worker decreased- that is, declined. productivity. SERVICE EXCELLENCE  Hawthorne Study A few years later, a second group of experiments began. Harvard researchers Elton Mayo and F. J. Roethlisberger supervised a group of five women in a bank wiring room. They gave the women special privileges, such as the right to leave their workstations without permission, take rest periods, enjoy free lunches, and have variations in pay levels and workdays. SERVICE EXCELLENCE  Hawthorne Study This experiment also resulted in significantly increased rates of productivity. In this case, Mayo and Roethlisberger concluded that the increase in productivity resulted from the supervisory arrangement rather than the changes in lighting or other associated worker benefits. SERVICE EXCELLENCE  Hawthorne Study The experimenters became the primary supervisors of the employees, the intense interest they displayed for the workers was the basis for the increased motivation and resulting productivity. Essentially, the experimenters became a part of the study and influenced its outcome. This is the origin of the term Hawthorne effect, which describes the special attention researchers give to a study’s subjects and the impact that attention has on the study’s findings. SERVICE EXCELLENCE Hawthorne Study The general conclusion from the Hawthorne studies was that human relations and the social needs of workers are crucial aspects of business management. This principle of human motivation helped revolutionize theories and practices of management. SERVICE EXCELLENCE  Douglas McGregor Douglas McGregor was heavily influenced by both the Hawthorne studies and Maslow. He believed that two basic kinds of managers exist. One type, the Theory X manager, has a negative view of employees and assumes that they are lazy, untrustworthy, and incapable of assuming responsibility. On the other hand, the Theory Y manager assumes that employees are not only trustworthy and capable of assuming responsibility, but also have high levels of motivation. SERVICE EXCELLENCE  Douglas McGregor An important aspect of McGregor’s idea was his belief that managers who hold either set of assumptions can create self-fulfilling prophecies – that through their behavior, these managers create situations where subordinates act in ways that confirm the manager’s original expectations. SERVICE EXCELLENCE Behavioral Management Theory in Summary As a group, these theorists discovered that people worked for inner satisfaction and not materialistic rewards, shifting the focus to the role of individuals in an organization’s performance. SERVICE EXCELLENCE 2.4 Modern Management Theory Quantitative Modern Management Theory Management Theories System theory Contingency theory SERVICE EXCELLENCE 1. Quantitative School of Management The quantitative school of management is a result of the research conducted during World War II when mathematicians, physicists, and other scientists joined together to solve military problems. The quantitative approach to management involves the use of quantitative techniques, such as statistics, information models, and computer simulations, to improve decision making. SERVICE EXCELLENCE  Quantitative Approach Managers can use computer models to figure out the best way to do something, saving both money and time. Managers use several science applications. Quality control Inventory Queuing management theory Supply chain Linear management programming The scientific applications of mathematical Value chain techniques to Network analysis management models problems SERVICE EXCELLENCE  Operations Management Operations management is a narrow branch of the quantitative approach to management. It focuses on managing the process of transforming materials, labour, and capital into useful goods and/or services. SERVICE EXCELLENCE Management Information Systems  Management information systems (MIS) is the most recent subfield of the quantitative school.  A management information system organizes past, present, and projected data from both internal and external sources and processes it into usable information, which it then makes available to managers at all organizational levels. SERVICE EXCELLENCE  Quality school of Management The quality school of management is a comprehensive concept for leading and operating an organization, aimed at continually improving performance by focusing on customers while addressing the needs of all stakeholders. In other words, this concept focuses on managing the total organization to deliver high quality to customers. Quality management involves employees in decision making as a way to prevent quality problems. The Kaizen approach uses incremental, continuous improvement for people, products, and processes. The reengineering approach focuses on sensing the need to change, seeing change coming, and reacting effectively to it when it comes. SERVICE EXCELLENCE  2. System Management Theory The systems management theory has had a significant effect on management science. A system is an interrelated set of elements functioning as a whole. An organization as a system is composed of four elements: Inputs - material or human resources Transformation processes - technological and managerial processes Outputs - products or services Feedback - reactions from the environment SERVICE EXCELLENCE SERVICE EXCELLENCE  System Management Theory Types of Systems a) Closed system: An organization that interacts little with its external environment (outside environment) and therefore receives little feedback from it is called a closed system. b) An open system: In contrast, interacts continually with its environment. Therefore, it is well informed about changes within its surroundings and its position relative to these changes. The following terminology is important to your understanding of the systems approach: a) A subsystem is any system that is part of a larger one. b) Entropy is the tendency of systems to deteriorate or break down over time. c) Synergy is the ability of the whole system to equal more than the sum of its parts. SERVICE EXCELLENCE 3. Contingency School of Management The contingency school of management can be summarized as an “it all depends” approach. The appropriate management actions and approaches depend on the situation. Managers with a contingency view use a flexible approach, draw on a variety of theories and experiences, and evaluate many options as they solve problems. Contingency management recognizes that there is no one best way to manage. SERVICE EXCELLENCE  Contingency school of Management In the contingency perspective, managers are faced with the task of determining which managerial approach is likely to be most effective in a given situation. For example, the approach used to manage a group of teenagers working in a fast-food restaurant would be very different from the approach used to manage a medical research team trying to find a cure for a disease. SERVICE EXCELLENCE  Summary of Theories VIEWPOINT INNOVATIVE CONTRIBUTIONS Classical 1. Highlights the need for a scientific approach management. 2. Points out that work methods often can be improved through study. 3. Identifies a number of important principles that are useful in running organizations efficiently. 4. Emphasizes the important of pay as a motivator. Quantitative 1. Provides quantitative aids to decision making. 2. Develop quantitative tools to assist in providing products and services. 3. Pioneers new computer-based information systems of management. SERVICE EXCELLENCE  Summary of Theories VIEWPOINT INNOVATIVE CONTRIBUTIONS Behavioral 1. Spotlight the managerial importance of such factors as communication, group dynamics, motivation and leadership. 2. Articulates practical applications of behavioral studies. 3. Draws on the findings of a number of disciplines such as management, sociology, psychology, anthropology and economics. 4. Highlights the importance of organization members as active human resources rather than passive tools. SERVICE EXCELLENCE  Summary of Theories VIEWPOINT INNOVATIVE CONTRIBUTIONS Contemporary (systems and 1. Emphasizes that organizations can be visualized contingency) as systems of interrelated parts. 2. Points out the potential importance of the environment and feedback to organization success. 3. Argues that there is no one best way to manage and identifies circumstances or contingencies that influence which particular approach will be effective in a given situation. SERVICE EXCELLENCE