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theories of management

1. THEORIES OF MANAGEMENT GROUP-3 Caseres , Cristel Ann C. Casona , Anthony H. Comellas , Carima M. Culla , Melody H. Dacer , Jolly Mae B. Damasing , Mavyll M. Llamera , Qyle Nacasabog , Ashley Wayne

2. Theories of Management a collection of ideas that recommend general rules for how to manage an organization or business. address how supervisors implement strategies to accomplish organizational goals and how they motivate employees to perform at their highest ability.

3. Where did management theories originate? It originates on the mass production and the Industrial Revolution brought about new requirements.

4. 3 Group of Management Theories 1. Classical Management Theories believes that employees are strongly motivated by their physical needs and more specifically, monetary incentives. organizations that implement this management style often incorporate regular opportunities for employees to be rewarded for their productivity with incentives. 2. Modern Management Theories believes that employees work for numerous reasons, including to achieve satisfaction, happiness and desired lifestyles. managers understand employees' behaviors and needs and can implement strategies to meet those needs and support their skill development over time. 3. Behavioral Management Theories believed that a better understanding of human behavior at work, such as motivation, conflict, expectations, and group dynamics, improved productivity.

5. Classical Management Theories: 1. Scientific Management Theory 2. Administrative Management Theory 3. Bureaucracy Management Theory

6. Scientific Management is a theory of management that analyzes and synthesizes workflow. Its main objective is improving economic efficiency, especially labor productivity. One of the earliest attempts to apply science to the engineering of processes and to management. Scientific management is sometimes known as Taylorism after F. W. Taylor. Scientific Management Theory

7. Taylor’s theory of scientific management aimed at improving economic efficiency and labor productivity. Taylor had a simple view that money motivated people at work. He felt that workers should get a fair day's pay for a fair day's work, and that pay should be linked to the amount produced. He introduced the differential piece rate system, of paying wages to the workers. FREDERICK WINSLOW TAYLOR Theory of Scientific Management

8. Four Principles of Scientific Management Time and motion study : Develop a science for each element of the job to replace the old rule of the methods. Study the way jobs are performed and find new ways to do them. Training : Scientifically select employees and then train them to do the job as described in step-1. Teach, train, and develop the workman with improved methods of doing work. Codify the new methods into rules. Supervision : Interest of employer & employees should be fully harmonized so as to secure mutually understanding relations between them. Supervise employees to make sure they follow the prescribed methods for performing their jobs. Continue to plan the work but use workers to actually get the work done. Differential Rewards : Establish fair levels of performance and pay a premium for higher performance.

9. Taylor's scientific approach resulted in a:   piece-rate incentive system time-and-motion study. Theory of Scientific Management

10. Taylor's Differential Piece Rate Plan : Taylor felt that the wage system was one of the major reasons for soldiering. To resolve this problem, he advocated the use of a piece-rate incentive system. The aim of this system was to reward the workers who produced the maximum out-put. The system proposed: If Efficiency is greater than the defined Standard then workers should be paid 120 % of the Normal Piece Rate. If Efficiency is less than standard then workers should be paid 80% of the Normal Piece Rate. Theory of Scientific Management

11. To scientifically determine the optimal way to perform a job, he performed experiments he called Time Studies. It was characterized by the use of stopwatch to time a worker’s sequence of motion. Time and Motion Study: Theory of Scientific Management

12. Some examples of time and motion studies: 1. The science of shoveling : Taylor ran time studies to determine that the optimal weight a worker should lift in a shovel was 21 lbs. Shovel should be sized to hold only 21 lbs of substance. The result was a 3 times increase in productivity. Thus, increased wage for workers. Theory of Scientific Management

13. Some examples of time and motion studies: 2. Pig Iron : Workers were moving 12.5 tons of pig iron per day. It was increased to 47.5 tons per day. By conducting experiments, managers could determine optimal time of lifting and resting However only 1/8 th of workers were capable of doing it. This suggests that workers should be selected according to how well they are suitable for a particular job. Theory of Scientific Management

14. Limitations of Scientific Management : Although Scientific Management Theory has been instrumental in providing various valuable insights into the development of management thought. In spite of the numerous contributions made by scientific theory, given below are the few limitations: The principles of scientific management focus on solutions from an engineering point of view rather than a managerial point of view The entire theory is based on the assumption that humans are rational and motivated primarily by the desire for material gain. It overlooks the social and emotional needs of workers and overstressed their economic and physical needs The human desire for self-actualization and job-satisfaction (working conditions, job content, etc.) is ignored by the theory Theory of Scientific Management

15. 2. Administrative Management Theory Main proponent: Henri Fayol - a French mining engineer 14 Principles of Management a. Division of Work - segregating work in the workforce amongst the worker will enhance the quality of the product. b. Authority - managers have the right to give orders and must assume responsibility for their actions. c. Discipline - employees need to obey and respect the rules of the organization. d. Unity of Command - an employee should have only one boss and follow his command. If an employee has to follow more than one boss, there begins a conflict of interest and can create confusion.

16. e. Centralization – must be clear who makes a decision and how these decisions be implemented. f. Unity of Direction - all the person working in a company should have one goal and motive which will make the work easier and achieve the set goal easily. g. Subordination of Individual Interest - indicates a company should work unitedly towards the interest of a company rather than personal interest. h. Scalar Chain – there should be a clear line of authority and communication from top management to the lowest rank. i. Remuneration – fair wage must be given to employees for their services.

17. j. Order - company should maintain a well-defined work order to have a favourable work culture. k. Initiative - management should support and encourage the employees to take initiatives in an organization. l. Stability - An employee delivers the best if they feel secure in their job. It is the duty of the management to offer job security to their employees. m. Equity – managers should be fair and kind to their subordinate. n. Esprit de Corps -  the responsibility of the management to motivate their employees and be supportive of each other regularly. Developing trust and mutual understanding will lead to a positive outcome and work environment.

18. 3 . Bureaucracy Management Theory Main proponent: Max Weber - a German sociologist, historian, jurist, and political economist In a bureaucratic organization, the subordinates follow the order of superiors but can appeal if they feel the need. On the other hand, in traditional structures, the authority was diffused. Rules are exhaustive, stable, and employees can learn them easily. Further, the organization records them in permanent files .

19. Personal property is separate from the office property. Also, the means of production or administration belong to the office. The selection of officials is based on technical qualification and appointment and not an election. Further, officials receive a salary as compensation for their work. The official is taken in for a trial period and then offered a permanent position with the organization. This protects him from arbitrary dismissal.

20. Principle of Management a. A formal hierarchical structure – In a bureaucratic organization, each level controls the level below it. Also, the level above it controls it. A formal hierarchy is the basis of central planning and centralized decision-making. b. Rules-based Management – The organization uses rules to exert control. Therefore, the lower levels seamlessly execute the decisions made at higher levels. c. Functional Specialty organization – Specialists do the work. Also, the organization divides employees into units based on the type of work they do or the skills they possess.

21. d. Up-focused or In-focused Mission – If the mission of the organization is to serve the stockholders, board, or any other agency that empowered it, then it is up-focused. On the other hand, if the mission is to serve the organization itself and those within it (like generating profits, etc.), then it is in-focused. e. Impersonal – Bureaucratic organizations treat all employees equally. They also treat all customers equally and do not allow individual differences to influence them. f. Employment- based on Technical Qualifications – Selection as well as the promotion of employees is based on technical qualifications and skills.

22.   Modern Management Theories This theory combines mathematical analysis with an understanding of human emotions and motivation in order to create a working environment that is maximally productive.   1. Quantitative Management Theory Increase the quality of decision making through the application of mathematical and statistical method with the help of computer. This approach is useful in areas of planning and control where data is available in quantitative terms. Decisions are based on data and logic rather than intuition and judgement.

23. 2. System Management Theory Proponent: Ludvig Von Bertalanffy a system is a collection of parts brought together to accomplish some end goal or objective. System Types Open System: A system that continually interacts with the environment around it. For example, a manufacturer might use several different suppliers of flour to make the product they produce, or an organization might have to move or change as the demands of consumers change. Closed System: Is the opposite of an open system. It is a system (or company) independent of the environment around it. Usually when we look at closed systems, we are looking at very high tech types of products that have limited sources of input and produce a consistent product or output (like space satellites). In fact, satellites are produced in a protected environment, like a lab, to ensure there is no contamination.

24. 3. Contingency/Situational Management Theory No best way to manage, it all depends on the situation. Identify the best technique that will be effective in a particular situation at a particular time as they solve problems. Managers device and apply similar responses to common types of problems.

25. Behavioural Management Theories 1. Theory X and Theory Y Proponent: Douglas Mcgregor The other assumption under theory X is that the employees need to be threatened or forced to work towards the organizational goals. They will avoid responsibility and the managers have to supervise them at every step. In an organisation where theory X is followed, the management too follows an authoritarian style. There is little delegation of authority from the management.

26. On the other hand, companies who follow theory Y have a more decentralized approach, which means that the authority is distributed among employees. This keeps them motivated. There are some key assumptions under theory Y. One of them is that employees take responsibility of their actions and work towards achieving the goals of the organization without much supervision. Theory X works on the idea of punishing people to keep the work going, while under theory Y, promotions, rewards, and recognition play an important part.

27. 2. Human Relation Theory Organizational success also depends on treating workers well. Focuses on people, particularly the psychological and social aspect of work. Sees people not as just extension of machines but as valuable organizational resources in their own right. Holds that people’s need are important and that their efforts, motivation, and performance are affected by the work they do and their relationships with the bosses, and co-workers.

28. HOW TO SELECT MANAGEMENT THEORY? Each management theory provides valuable insight into managerial requirements. There is no single theory that will work for every organization. Nowadays, many modern organizations apply a combination of theories to realize management success.

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