THEORIES OF ORGANIZATION-PUBLIC ADMINISTRATION

Theories of organization, the different organizational theories for Public Ad students and Business Ad.

1. Organization Theories and Management in the Public Sector Humphrey A. Beña MPA-CBG Student Based on the presentation of K.D. Gragales and R. Jain and the Word Text Management I by R. Ngolob , Ph.D. and company.

2. Definition of Terms Organization -an organized body of people with a particular purpose, especially a business, society or an association. According to Daft(2006): “an organization is a social entity that is goal oriented and deliberately structured.”

3. Looking closer: ORGANIZATION SOCIAL ENTITY Comprising of two(2) or more people. GOAL ORIENTED It aims to achieve results and outcomes. DELIBERATELY STRUCTURED With functions and responsibilities of members. Source: Principles of Management I Word Text by Dr. R. Ngolob , et. al., University of the Cordilleras

4. WHAT IS MANAGEMENT? Management is the attainment of organizational goals in an effective and efficient manner through planning, organizing, leading, and controlling organizational resources(Daft, 2005). Management is the process of working with people and resources to accomplish organizational goals( Baterman and Snell, 2007).

5. MANAGEMENT ORGANIZATIONAL GOALS EFFICIENCY AND EFFECTIVENESS PLANNING ORGANIZING LEADING CONTROLLING (Functions of Management) RESOURCES (5 M’s of Management) Manpower, Materials, Money, Machine and Methods

6. What is a Theory? A theory is a set of interrelated propositions that organizes and explains a set of observed phenomenon. A perspective, a view, an approach, a model.

7. “ a theory may be viewed as a system of constructs and variables in which the constructs are related to each other by propositions and the variables are related to each other by hypotheses.”(Bacharach, 1989) “ Theories propose reasons in the form of cause-and effect relationships that explain the variation of a particular phenomenon in terms of the effects of the action of, or the variation in, another phenomenon – the why and the how.”(John McAuley, Duberley and Johnson, 2007) “The prime objective of a theory is to respond the queries about when, why, and how contrasting the objective of explanation, which is to response to the query of what.”(Ferdous, 2016)

8. THE THEORIES OF ORGANIZATION AND MANAGEMENT CLASSICAL THEORIES NEO-CLASSICAL THEORY MODERN STRUCTURAL/ORGANIZATIONAL THEORIES

9. ORGANIZATIONAL THEORIES Organizational theories have been engaged with the formation of overall ideas and approaches that are appropriate to any organization, regardless of its societal, activities and geographical surroundings ( Irefin & Bwala , 2012). Organizational theory proceeds by way of its main item of study, the formal or complex organization. It is presumed that organizations have objectives, guidelines, hierarchy, definitions of affiliation, and vigorous ideas of career tracks for their affiliates. Organizational theory is worried with in what way the core organizational arrangement works to inspire members and yield results constant with the objectives of those who regulate the organization. It is as well involved in how the external world to an organization impacts what drives on inside of a specific organization. Lastly, it is anxious with how the core organization and the external sphere can influence organizational existence ( Fligstein , 2001). Source: Ferdous, Organizational Theories: From Classical Perspectives. 2016. International Journal of Business, Economics and Law, Vol. 9, Issue 2

10. CLASSICAL ORGANIZATIONAL THEORIES The studies made by the classical scholars of organization concentrated their devotion upon the laying down of the organizational ideologies and upon the official features of the organization. The organization scholar mostly examines into the philosophies and recommends the clarifications to be taken into concern by the heads such as the instructions confirming an effective management. Through the classical scholar of organization, we can see very few experiments and administrative observation for trying the viability of the philosophies and propositions projected ( Ivanko , 2012). Classical theorists of organization concentrated their attention on the principles of organization and the formal aspects of the organization. The organization theorist principally explores the ideologies and recommends the solutions of effective management. Source: Ferdous, Organization Theories from Classical Perspective. 2016. International Journal of Business, Economics and Law, Vol. 9, Issue 2 (Apr.)

11. The classical theory is distributed into three modules: Scientific Management, Administrative Management and Bureaucratic management (Sofi, 2013). Frederick Taylor, Henri Fayol and Max Weber created the structure and the improvement frame of Classical OrganizationTheories (Yang et al., 2013). Source: Ferdous, Organization Theories from Classical Perspective. 2016. International Journal of Business, Economics and Law, Vol. 9, Issue 2 (Apr.)

12. THE THEORY OF BUREAUCRACY(Bureaucratic Theory of Organization) by MAX WEBER Bureaucratic Organizations Theory was developed by German Sociologist and Theorist, Max Weber. Emphasizes management on basis of impersonal and rational relationship through such elements as authority and responsibility, formal record keeping and separation of management and ownership(Daft, 2010) An organization should be based on rational authority, would be more efficient and adaptable to change because continuity is related to formal structure and positions rather than to a particular person.

13. Characteristics of WEBERIAN BUREAUCRACY 1. Labor is divided with clear definitions of authority and responsibility that are legitimized as official duties.

14. Characteristics of WEBERIAN BUREAUCRACY 2. Positions are organized in a hierarchy of authority, with each position under the authority of higher one.

15. Characteristics of WEBERIAN BUREAUCRACY 3. All personnel are selected and promoted based on technical qualifications which are assessed by examination or according to training and experience.

16. Characteristics of WEBERIAN BUREAUCRACY 4. Administrative acts and decisions are recorded in writing. Record keeping provides organizational memory and continuity over time.

17. Characteristics of WEBERIAN BUREAUCRACY 5. Management or administration is separate from the ownership of the organization.

18. Characteristics of WEBERIAN BUREAUCRACY 6. Managers and administrators are subject to rules and procedures that will ensure reliable, predictable behavior. Rules are impersonal and uniformity applied to all employees.

19. Weber’s bureaucratic approach considers the organization as a part of broader society. The organization is based on the principles of: STRUCTURE SPECIALIZATION PREDICTABILITY AND STABILITY RATIONALITY DEMOCRACY

20. ADMINISTRATIVE THEORY OF ORGANIZATION by HENRI FAYOL Developed by a French Mining Engineer, Henri Fayol. This theory is known as “ Fayolism ”. Fayol is the Father of Modern Management Theory. Focuses on the total organization rather than the individual worker. Delineated the five management functions.

21. The Five Main Management Functions

22. But according to Mahmood et. al, (2012), there were actually Six:

23. Fayol well-known administrative capability was vital for the success of the organization. Administrative capability, according to Fayol, rests on definite talents and understanding: Physical qualities Mental qualities Moral qualities General education Special knowledge and Experience (Wren & Bedeian , 1994). Source: Ferdous, Organization Theories from Classical Perspective. 2016. International Journal of Business, Economics and Law, Vol. 9, Issue 2 (Apr.)

24. Fayolism’s 14 Principles 1. SPECIALIZATION OF LABOUR OR DIVISION OF WORK -Specializing encourages continuous improvement in skills and the developments in methods. 2. AUTHORITY -The right to give orders and power to exact obedience. 3. DISCIPLINE -No slacking, bending the rules. The workers should be obedient and respectful of the organization. Source: Principles of Management 1 by R. Ngolob and company, University of the Cordilleras

25. Fayolism’s 14 Principles 4. UNITY OF COMMAND -Each employee has one and only one boss. 5. UNITY OF DIRECTION -A single mind generates a single plan, and all play their part in that plan. 6. SUBORDINATION OF INDIVIDUAL INTERESTS -When at work, only work things should be pursued or thought about. Source: Principles of Management 1 by R. Ngolob and company, University of the Cordilleras

26. Fayolism’s 14 Principles 7. REMUNERATION -Employees receive fair payment for services, not what the company or organization can get away with. 8. CENTRALIZATION -Consolidation of management or administrative functions. Decisions are made from the top. 9. SCALAR CHAIN OF SUPERIORS/LINE OF AUTHORITY -Formal chain of command running from top to bottom of the organization, like military. 10. ORDER -All materials and personnel have a prescribed place, and they must remain there. Source: Principles of Management 1 by R. Ngolob and company, University of the Cordilleras

27. Fayolism’s 14 Principles EQUITY -Equality of treatment (but not necessarily identical treatment). PERSONNEL TENURE -Limited turnover of personnel and lifetime employment for good workers. INITIATIVE -Thinking out a plan and do what it takes to make it happen. ESPRIT DE CORPS -Harmony, cohesion among the members of the organization. Source: Principles of Management 1 by R. Ngolob and company, University of the Cordilleras

28. SCIENTIFIC MANAGEMENT THEORY OF ORGANIZATION by FREDERICK WINSLOW TAYLOR Introduced by American Mechanical Engineer, Frederick Winslow Taylor, also known as the father of Scientific Management. This theory would become known as “Taylorism”. Management and administration would have to change, and that the manner of change could be determined only by scientific study. Decisions based on rule of thumb and traditions should be replaced with precise procedures developed after careful study of individual situations.

29. TAYLORISM: Reducing the antagonism between employer and the employees Taylor observes management as the procedure of getting things done by the effort of the people working independently or in sets. Taylor’s core idea is that affluence to the society can come simply from the cooperative effort of the management and worker in the use of scientific methods. He emphasized for mental revolution on both the part of management and labor side, thus that they may work together in the essence of work coordination with a vision to cultivating their particular lots achieving high pays for labor and better output at little expenses for management. Taylor perceives that management is ignoring its tasks, and force the liability of systems and production on labor. He asserts that management should commit to do the planning of work, defining methods, organizing, directing and the like for which it is finest fit( Sapru , 2008). Source: Ferdous, Organization Theories from Classical Perspective. 2016. International Journal of Business, Economics and Law, Vol. 9, Issue 2 (Apr.)

30. Taylor’s Four Principles of Scientific Management 1. Replace the old rule-of-thumb method through the development of a science for every component of a man’s work. Source: Ferdous, Organization Theories from Classical Perspective. 2016. International Journal of Business, Economics and Law, Vol. 9, Issue 2 (Apr.)

31. Taylor’s Four Principles of Scientific Management 2. Select, train, show and improve the workman through scientific method. Source: Ferdous, Organization Theories from Classical Perspective. 2016. International Journal of Business, Economics and Law, Vol. 9, Issue 2 (Apr.)

32. Taylor’s Four Principles of Scientific Management 3. Collaboration with men wholeheartedly so as to complete the assignment scientifically. Source: Ferdous, Organization Theories from Classical Perspective. 2016. International Journal of Business, Economics and Law, Vol. 9, Issue 2 (Apr.)

33. Taylor’s Four Principles of Scientific Management 4. Equally divide the work and the responsibility concerning the management and the worker. The management gets all determination for which they are fine fitted than the workmen. Source: Ferdous, Organization Theories from Classical Perspective. 2016. International Journal of Business, Economics and Law, Vol. 9, Issue 2 (Apr.)

34. Characteristics of Scientific Management Developed standard method for performing each tasks. Selected workers with appropriate abilities for each tasks. Trained workers in standard methods. Supported workers by planning their work and eliminating interruptions. Provided wage/salary incentives to workers for increased output. Source: Principles of Management 1 by R. Ngolob and company, University of the Cordilleras

35. Drawbacks of the Taylorism Did not appreciate the social context of work and higher needs of workers. Did not acknowledge variance among individuals. Tended to regard workers ad uninformed. Treated workers in a machine-like fashion. Source: Principles of Management 1 by R. Ngolob and company, University of the Cordilleras

36. Taylor presented an inadequate attention to organizations. He was considered merely at organizing effort at the bottom level of the organization that are suitable to the management work of a manager (Robbins & Mathew, 1990). Scientific management transformed business because it describes how to raise production by functioning smoother, not tougher. Up until that time, growing output intended more employees, more raw materials, more hours, and more expenses. Scientific management practices simple sense to express how division of labor, standardization, and productivity, emphasized an image of effectiveness that booms currently (Adeyemi et. al, n.d.). Therefore, Scientific Management, in general has taken a significant and extensive influence on the business exercise and on the theoretical concepts of organizations. Yet, it still works as a guide for methodological dealings, not simply in the industrial sector, but in the service sector as well. Source: Ferdous, Organization Theories from Classical Perspective. 2016. International Journal of Business, Economics and Law, Vol. 9, Issue 2 (Apr.)

37. NEO-CLASSICAL THEORY OF ORGANIZATION The neoclassical theory is the extensive version of the classical theory that includes behavioral science in business management. In this theory, the organization is the social system, and its performance is affected by human efforts. The neoclassical theory states that an organization is a mix of both informal and formal aspects of the organization. This aspect was ignored in classical theory. The organization’s informal structure is majorly formed due to the social interaction with workers; this affects and gets affected by an organization’s formal structure. Generally, disputes between the organization and workers often exist but this needs to be resolved immediately as the problems persist. Source: Vendantu

38. Neoclassical theory (also referred to as human relations of thoughts) was introduced based on classical theory. It has added, modified, and in some way extended classical theory. The basic assumption of this theory is that the physiological and social aspects of a worker as an individual and his workgroup ought to be focused on. In classical theory, the organization emphasized order, structure, economic factors, formal organization, and objective rationality. Whereas neo-classical theory emphasized social factors and emotions at work.  Human relation is a general term that is frequently used to describe how a manager interacts with their employees. The importance of human relations is included in two aspects: The organization situation should be observed in social terms as well as economical and technical terms, and in terms of clinical method, it is similar to the doctor’s diagnosis of the human organisms. Source: Vedantu

39. This theory originated from the findings of famous HAWTHORNE EXPERIMENTS conducted under the leadership of Elton Mayo. It developed with the human relations movement. The Neo-classical school focuses on human beings and human behavior in organization. Human behavior in the organization is affected by formal and informal aspects.

40. Characteristics and Contributions of Neo-classical Theory of Organization The organization is a social system composed of several interacting systems. The Social environment of the job affect people and is also affected by the people. Integration between organizational and individual goals is a must. Money is only of the motivators but not sole. Human beings are not always rational. They have rationality as far as rewards from the job are concerned. Two way communication is necessary for functioning of the organizations. Team work is essential for cooperation and productivity. Only achieved through behavioral approach.

41. Principles of this approach: INDIVIDUAL WORK GROUP PARTICIPATIVE MANAGEMENT

42. HUMANISTIC PERSPECTIVES TIED TO THIS THEORY THE HUMAN RELATIONS PERSPECTIVE -effective control comes from within the individual worker rather than from strict and authoritarian control. THE HUMAN RESOURCE APPROACH -satisfied workers will give more work. THE BEHAVIORAL SCIENCES APPROACH -understanding employee behavior and interactions within the organization. THE MANAGEMENT SCIENCE PERSPECTIVE -reinforcement and improvement of scientific management using scientific fields. Key concepts: Operations Research; Operations Management, and Information Technology(IT). Source: Principles of Management 1 by R. Ngolob and company, University of the Cordilleras

43. CRITICISMS Not a new theory of organization. Merely a modification of the classical approaches. The structures of organization suggested are not suitable in all situations. Over emphasis on human aspect, but ignores and neglected other the others. Certain assumptions of this theory are not true.

44. MODERN THEORIES OF ORGANIZATION(Current Theoretical Trends) Also called “Modern Structural Organization Theory”, these theories or this theory is based on the concept that organization is an adaptive system which has to adjust changes in its environment. It has the following characteristics: Systems viewpoint Dynamic process of interaction Multileveled and multidimensional Multi motivated Probabilistic

45. CHARACTERISTICS OF MODERN ORGANIZATIONAL THEORY Considers organization as system composed of many subsystems such as managerial, technical, and social subsystem. It regards individual as complex being who can be motivated in multiple ways. It is descriptive approach of studying organizations. It is multi-disciplinary theory as it draws concepts and principles from several disciplines such as Psychology, Economics, Engineering and so on. It is dynamic in interaction with the structure. It is constantly subject to change as environment changes. Organization adapts itself suitably to the changing environment and it survives. It is both macro and micro in its approach. It is micro when considered with respect to the entire nation or industry. It is macro with respect to internal parts of the organization. It ensures better flow of communication at all levels and ensures effective control. Source: R. Jain, CH Institute of Management

46. THE SYSTEMS THEORY/APPROACH Considers the organization as a system composed of a set of interrelated and thus mutually dependent sub-systems. It anchors on the belief that organizations are no longer self-contained and are dependent on its environment for survival. It describes organizations as “open systems” that is characterized by the following: ENTROPY SYNERGY SUBSYSTEMS

47. ENTROPY According to R. Daft(2010), Entropy is the concept for a system to run down and die. If systems does not receive fresh inputs and energy from its environment. It will eventually cease to exist. Organization must monitor their environments, adjust to changes, and continuously bring in new inputs in order to survive and prosper.

48. SYNERGY Synergy , according also to Daft, is the concept that the whole is greater than the sum of its parts. Organizational units working together can accomplish more than those same units working alone.

49. SUBSYSTEMS Subsystems according to Daft, refers to the parts of a system that depend on one another fort their functioning. Changes in one part of the organization affect other parts. The organization must be managed as coordinated whole.

50. A system is a set of interrelated parts that function as a whole to achieve a common purpose by acquiring inputs from external environment transforming them in some way and discharging output back to the environment. The five components of a system are in the illustration. THE SYSTEMS THEORY MODEL F EEDBACK (praises, comments, suggestions) E NVIRONMENT (political, economic, social) I NPUTS (materials, human, capital, information ) T RANSFORMATION PROCESS (technology, tools, methods of production ) O UTPUTS (products and services) SYSTEM

51. CONTINGENCY THEORY/APPROACH Successful resolution of organizational problems is thought to depend on manager’s identification of the key variations in the situation at hand(Lawrence and Lorsch, 1967). As opposed to scientific management, the contingency view believes that each management situation is unique, and therefore there are no uniform or universal principles that apply in each case. This is called the CASE VIEW. The classical perspective assumed a UNIVERSALIST VIEW, which tends to believe there is only ONE BEST WAY to do things that works in any organization. Managements’ job is to search for the most applicable practice in every situation. Source: Principles of Management 1 by R. Ngolob and company, University of the Cordilleras

52. TOTAL QUALITY MANAGEMENT THEORY The concept of Total Quality Management(TQM) was developed by a number of American businessmen including names like W. Edwards Deming, Joseph Juran , and A.V. Feigenbaum. Called the SIX SIGMA STRATEGY in Japan. TQM values an integrative philosophy of management anchored on continuous improvements of the quality of products and processes. Images from:

53. COMPONENTS OF TQM EMPLOYEE INVOLVEMENT -the organization’s TQM requires organization wide participation in quality control.

54. COMPONENTS OF TQM FOCUSED ON THE CUSTOMERS/CLIENTS- finds out what customers/clients/constituents want and try to meet their needs and expectations.

55. COMPONENTS OF TQM BENCHMARKING -refers to the process whereby organizations find out how others do something than they do and then try to imitate or improve on it.

56. COMPONENTS OF TQM CONTINUOUS IMPROVEMENT -implementation of small, incremental improvements in all areas of the organization on an ongoing basis.

57. OTHER THEORIES/MODELS OF ORGANIZATION Socio-Technical Approach Human Resource Theory Organizational Economics Theory Power and Politics Organizational Theory Theories of Organizational Culture and Change Theories of Organization and Events Public Choice Model Institutional Model

58. THE NATURE OF ADMINISTRATIVE ORGANIZATION Organizing Departmentalization Coordination Span of Control Centralization vs Decentralization

59. ORGANIZING AND DEPARTMENTALIZATION Organizing is the process of dividing the group into sections and departments. These were the definitions of organization in the genre of management.( Vedantu ) Departmentalization , also referred to as departmentation, is the process of grouping teams or activities into departments or functions with specific objectives, goals, and outcomes to be achieved.(AIHR)

60. COORDINATION Coordination is the function of management which ensures that different departments and. groups work in sync. Therefore, there is unity of action among the employees, groups, and departments. It also brings harmony in carrying out the different tasks and activities to achieve.( Vijayanagara Sri Khrisnadevaraya University) Establishing clear-cut procedures and rules Use of the hierarchical structure Use of matrix departmentalization Introducing dominant idea or rationale

61. SPAN OF CONTROL

62. THE PHILIPPINE ADMINISTRATIVE STRUCTURE

63. THE THREE BRANCHES OF THE PHILIPPINE GOVERNMENT EXECUTIVE LEGISLATIVE JUDICIARY The Office of the President The Office of the Vice President Cabinet Members and Departments Agencies under the Executive Branch Senate of the Philippines(Higher House) House of Representatives(Lower House) Supreme Court RTC, MTC Other Special Courts

64. Image source: Pitzviews Learning

65. Image source: Pitzviews Learning

66. Image source: Pitzviews Learning

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