Unit 1.2 Theories of Managemen1t234.pptx

Talk about various theories used in management

1. Unit 2 : Theories of Management Management Thought and Approaches

2. Unit Objectives Describe evolution of management thoughts and schools of thought . Identify two key assumptions supporting the universal process approach and briefly describe Henry Fayol’s contribution. Discuss Frederick W. Taylor’s approach to improving the practice of industrial management. Describe the general aim of the human relations movement and explain the circumstances in which it arose. Explain open-system and contingency perspectives. Discuss management’s responsibilities to society.

3. Introduction to Management Theory Management practice is ancient, but systematic study is recent. No single universally accepted theory exists. Management theory helps managers: Set and achieve organizational goals. Motivate employees. Apply effective management methods.

4. Definition of Management Theory A collection of ideas providing general rules for managing organizations. Focuses on: - Manager-organization relationship. - Goal achievement strategies. - Employee motivation.

5. Common Theories of Management Five Key Approaches: 1. Universal Process Approach (Administrative Management) 2 . Operational Approach (Scientific Management) 3 . Behavioural Approach (Human Relations) 4 . Systems Approach 5 . Contingency Approach Purpose : Understand evolution and application of management practices.

6. No Universally Accepted Theory of Management There are several approaches to the theory and practice of management. The universal process approach The operational approach The behavioral approach The systems approach The contingency approach

7. Henri Fayol – Administrative Management Universal Process Approach: Same management principles apply across all organizations. Key Assumptions: 1 . Core management process is universal. 2 . Management can be divided into functions and principles. Fayol’s 5 Functions: Planning , Organizing, Command, Coordination, Control

8. The Universal Process Approach Universal Process Approach Assumes all organizations require the same rational management process. Core management process remains the same regardless of the purpose of the organization. The management process can be reduced to a set of separate functions and related principles.

9. Henri Fayol’s Universal Management Process Fayol published Administration Industrielle et Générale in 1916. Divided manager’s job into five functions: Planning, organizing, command, coordination, and control. Developed 14 universal principles of management.

10. Henri Fayol’s Universal Management Process (cont’d) Lessons from the Universal Process Approach The management process can be separated into interdependent functions. Management is a continuous process. Management is a largely, though not an entirely, rational process. The functional approach is useful because it specifies what managers should do.

11. Frederick W. Taylor’s - The Operational Approach/Scientific Management Developed performance standards on the basis of systematic observations and experimentation. Operational Approach: Focus on efficiency, productivity, and reducing waste. Four Key Principles : Standardization of work practices and methods reduce waste and increase productivity. Time and task study of workers’ efforts to maximize productivity and output. Systematic selection and training of workers to increase efficiency and productivity. Differential pay incentives based on established work standards.

12. Taylor’s Differential Piece-Rate Plan

13. The Operational Approach (cont’d) Lessons from the Operational Approach Emphasizes productivity, efficiency, and methodical work . A dedication to finding a better way is still important. Using scientific management doesn’t dehumanize workers. Quality advocates, inspired by the scientific approach, have been right all along about the importance of quality and continuous improvement The operational approach fostered the development of operations management.

14. Elton Mayo – Human Relations School Behavioural Approach: People are central to organizational success . An effort to make managers more sensitive to their employees’ needs. Origins : The threat of unionization. The Hawthorne Studies – social factors affect performance. The Philosophy of industrial humanism

15. The Human Relations Movement Pyramid

16. The Behavioral Approach (cont’d) The Threat of Unionization The Wagner Act of 1935 legalized union-management collective bargaining, promoting the growth of unions and union avoidance by firms. The Hawthorne Studies (1924) The study’s results that productivity was strongly affected by workers’ attitudes turned management toward the humanistic and realistic viewpoint of the “social man” model.

17. The Philosophy of Industrial Humanism Elton Mayo Emotional factors were more important determinants of productive efficiency than were physical and logical factors. Mary Parker Follett Managers should be aware of how complex each employee is and how to motivate employees to cooperate rather than to demand performance from them.

18. The Philosophy of Industrial Humanism (cont’d) Douglas McGregor Developed Theory X and Theory Y Theory X: management’s traditionally negative view of employees as unmotivated and unwilling workers. Theory Y: the positive view of employees as energetic, creative, and willing workers.

19. Organizational Behavior Organization Behavior A modern research-oriented approach seeking to discover the causes of work behavior and to develop better management techniques. Lessons from the Behavioral Approach People are the key to productivity. Success depends on motivated and skilled individuals committed to the organization. Managerial sensitivity to employees is necessary to foster the cooperation needed for high productivity. Motivation depends on social, emotional, and psychological factors. Encourages cooperative work culture.

20. The Systems Approach What is a System? A collection of parts that operate interdependently to achieve a common purpose. Systems Approach Posits that the performance of the whole is greater than the sum of the performance of its parts. Analytic versus synthetic thinking: outside-in thinking versus inside-out thinking. Seeks to identify all parts of an organized activity and how they interact.

21. The Systems Approach Chester I. Barnard’s Early Systems Perspective Characterized all organizations as cooperative systems. Defined principle elements in an organization as willingness to serve. common purpose. communication.

22. Barnard’s Cooperative System

23. General Systems Theory (cont’d) Closed Versus Open Systems Closed system A self-sufficient entity. Open system Something that depends on its surrounding environment for survival. Systems are classified open (closed) by how much (how little) they interact with their environments.

24. The Contingency Approach Contingency Approach A research effort to determine which managerial practices and techniques are appropriate in specific situations. Different situations require different managerial responses. Can deal with intercultural feelings in which custom and habits cannot be taken for granted.

25. The Contingency Approach (cont’d) Contingency Characteristics An open-system perspective How subsystems combine to interact with outside systems. A practical research orientation Translating research findings into tools and situational refinements for more effective management. A multivariate approach Many variables collectively account for variations in performance.

26. The Contingency Approach (cont’d) Lessons from the Contingency Approach Approach emphasizes situational appropriateness and flexibility rather than rigid adherence to universal principles. Approach creates the impression that an organization is captive to its environment.

27. Key Takeaways Management theories guide practical decisions. Evolution : Task-oriented (Taylor) → people-focused (Mayo) → system & situational thinking (Barnard & Contingency). A manager’s choice of approach depends on situation, organizational needs, and goals.

28. Activities / Discussion 1. Explain the evolution of management thought and the problems addressed. 2. Define the contingency approach and its characteristics. 3. Discuss Taylor’s principles and Fayol’s 5 functions. 4. Summarize Fayol’s 14 principles of management.

29. Thank you