Management: Concepts and Evolution

An Introduction to Management
Definition:
The process of achieving desired results through efficient use of human and material resources.
Bedeian 1993

What are Managers?

What do all these people have in common?
1. They all work in organisations.
Organisations are collections of people who work together and coordinate their actions to achieve a wide variety of goals or desired future outcomes.
GR Jones, Organizational Theory, Design and Change (Upr Saddle River, JH: Pearson, 2007)

2. As Managers, they are the people responsible for supervising and making the most of an organisations human and other resources to achieve its goals.

What is Management?
Management is viewed as the process in which managers engage to achieve organisational goals.
Management concentrates on achieving specific organisational goals by employing human, financial, physical and information resources. Management is about getting things done through other people.
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Nature and Importance of Management

Management : * * * * revolutionised the social and economic fabric of the developed regions of the world. made the structure of modern industry possible. enabled large numbers of knowledgeable and skilled employees to achieve organisational goals. has become one of the most important resources of the developed world.
Drucker (1988)

Early Management Thought

Ancient Egyptians used managerial skills to build The Pyramids involving over 100,000 workers, taking 30 years to build Catholic Church Managerial techniques employed included a strict hierarchy of authority - from Priest, Parish Priest, Bishop, Arch Bishop, Cardinal & Pope and specialisation of members along a functional basis.
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Early Management Thought

The concept of centralisation of authority in Rome remains the same today as when it was first introduced in 2 AD.
The church became a model for the management of other religious organisations and also for the army who further developed the concepts of Leadership, Unity of Command, Line Authority and Staff Authority.
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The Industrial Revolution

A watershed in Management development: It is the name given to the long series of fundamental technological, economic, social and cultural changes which took place in England between 1760 and 1840. These changes transformed England from a rural economy into a great industrial nation. Technological changes included the following: the use of new basic raw materials, notably iron and steel the invention of new machines provision of new sources of energy including coal, the steam engine and later in the 1860's, electricity and petroleum. Goods could now be produced in larger quantities bringing about growth in consumer markets.

The Industrial Revolution

All these changes brought with them a new organization of work known as the factory system, based on the principles of the division of labour and specialization, where workers worked together in a tightly controlled situation with narrowly defined jobs. Corporate ownership changed the relationship between owners and employees and led to the origin of Modern Management.
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The Industrial Revolution

Mechanisation large scale factories productivity increased with economies of scale As organisations grew so did complexity Debate about management and the key current issues; production, efficiency & cost savings

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The Importance of Theory and History

Why Use Theories?
Theories provide conceptual frameworks for organizing knowledge and blueprints for actions.

Management theories are grounded in reality.

Managers develop their own theories about how they should run their organizations.

Why Study History?

Understanding history aids managers in the development of management practices and in avoiding the past mistakes of others.
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Classical Approaches
1. Scientific Management Concerned with improving the performance of individual workers (i.e., efficiency). Grew out of the industrial revolutions labor shortage at the beginning of the twentieth century. 2. Bureaucratic Approach

A logical, rational, and efficient organization design based on a legitimate and formal system of authority.
3. Administrative Management (Fayol) A theory that focuses on managing the total organization. 4. Human Relations Approach Organizations that pay attention to work groups and interpersonal processes are more effective than bureaucratic organizations.
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The Evolution of Management Thought

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1. Scientific Management (SM)

Birth of Scientific Management is attributed to Fredrick Taylor (1911)
The one best way of performing a task through the application of scientific methods

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Frederick Taylor (1856-1917)

Scientific Management
He trained in the USA as an Engineer. Scientific Management is concerned with the development of One Best Way of performing a highly specialised task (minimum training) through the application of scientific methods Time & Motion studies eg Ford Cars Mass Production Line systems, Call Centres. controlling speed of work He assumed that jobs can be designed on a rational basis in order to maximise workers efforts with a view to quicken production, radically reduce costs and increase output. He is responsible for the division of work between Management (directing and allocating work) and Workers (completing the tasks).
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Taylors 4 Steps in Scientific Management

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Criticisms of Scientific Management

Assumed people were motivated solely by money; Separation of planning/controlling led to a sense of 'alienation'/boredom by the worker; reduced the scope of a person's job; 'single best way' of doing job; ruled out TU activities such as 'bargaining' as rates were analysed and timed on a 'scientific basis'; The attempt to enunciate principles, laws, hypotheses, theorems, postulates (or whatever the current terminology) which apply to ALL organizations, rather than to SPECIFIC types of organizations. failed to deal with the relationship between the organisation and the environment.
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2. Bureaucracy
Max Weber (Early 1900s)
Translated into English from German in the 1920s Weber concentrated on how to structure organisations for success

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Bureaucratic Approach (Weber)

Bureaucratic Model (Max Weber)
1. The concept of bureaucracy is based on a rational set of guidelines for structuring organizations in the most efficient manner
2. A logical, rational, and efficient organization design based on a legitimate and formal system of authority

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Bureaucratic Approach (Weber)

Many people associate bureaucracy with red tape, rigidity and passing the buck and argue about the bureaucracy involved in the Department of Social and Family Affairs here in Ireland..

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2. Bureaucracy- 6 Main Elements

1. Division of labour Tasks divided & delegated to specialists so that responsibility & authority were clearly defined. 2. Hierarchy Positions were organised in a hierarchy of authority from Top to Bottom in the organisation. 3. Selection employees recruited on basis of technical qualifications rather than favouritism

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2. Bureaucracy- 6 Main Elements

4. Career orientation Managers were viewed as professionals pursuing careers rather than having ownership in the organisation.
Employment and advancement in the organisation should be based on technical expertise.
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2. Bureaucracy- 6 Main Elements

5. Formalisation Organisation was subject to formal rules & procedures ensuring efficiency.

6. Impersonality Rules & Procedures were applied uniformly to all employees.

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2. Bureaucracy in Ireland
Used in large scale organisations world-wide due to the fact that it allowed such organisations to perform many routine activities necessary for survival. Popular for public organisations such as civil service and Irish semi-state bodies eg Enterprise Ireland, FAS and DIT!

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2. Bureaucracy in Ireland
Consider the steps you must go through and the forms you must fill out to apply for admission to college and file for graduation
When paper is replaced with electronic media, the steps are often the same. The reason these procedures are necessary is that colleges deal with large numbers of people who must be treated equally and fairly. Hence, rules, regulations, and standing operating procedures are needed. Trade Unions are also usually organised as bureaucracies

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Strengths of Bureaucracy
A primary strength of the bureaucratic model is that several of its elements (such as reliance on rules and employment based on expertise) do, in fact, often improve efficiency.

Bureaucracies also help prevent favouritism (because everyone must follow the same rules) and make procedures and practices very clear to everyone.

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Criticisms of Bureaucracy
Extensive rules and procedures can sometimes become ends in themselves; People are stereotypes. Not enough resources to treat everyone uniquely. Bureaucracy too rigid at times; Slow to act and react to changing environment; Resists change;

Means can be more important than ends e.g. job descriptions can be more important than the people who fill them;
Strict division of labour can lead to jobs becoming routine and boring.
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3. Henri Fayol 1841-1925 Administrative Management

Administrative Management Theory
Focuses on managing the total organization rather than individuals (eg Scientific Mgt)

Henri Fayol
Wrote General and Industrial Management. Helped to systematize the practice of management. Was first to identify the specific management functions of planning, organizing, leading, and controlling.
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 Administrative management/Fayol was concerned with Administrative Principles that apply to the organisation as a whole. He identified them as the 14 Universal Principles of Management He focused on senior managers and identified key functions which managers needed to achieve ie Planning, Organising, Leading (motivating) and Controlling. Fayol concluded that all business activities should be divided into six essential areas
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Fayols Fourteen Management Principles

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Fayols 14 Principles
1. Division of Labour: Results in specialisation of functions and separations of powers (too much specialisation = boredom) 2. Discipline: Obedience, energy, application, respect for a superiors authority. (trying to create a reliable & hardworking workforce. Discipline, he
said, results in respectful relations between organisational members and reflects the quality of an organisations leadership and a managers ability to act fairly and equitably.

3. Authority & Responsibility: Distinguishes between formal and personal authority. Personal authority is derived from intelligence, experience and ability; formal/official authority from a POSITION within the organisations hierarchy.

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Authority
Definition:
Authority refers to the discretion and scope given to a person to make decisions. The authority that a person has will determine the role to be played by that person. It will also determine his/her relationship with other people in the company.
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Responsibility
Definition:
Responsibility is an obligation to perform assigned duties to the best of one's ability. Responsibility and authority are closely linked. Any person with authority should have commensurate responsibility and, likewise, any person having responsibility should have commensurate authority.

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Fayols 14 Principles
4. Unity of Command: Roles must not become blurred and a focused reporting structure to ONE BOSS is in place. (Dual
command, he said, confuses workers, undermines order and discipline and creates havoc within the formal hierarchy of authority. Assessing the managers authority and responsibility in a system of dual command is difficult and the manager who is bypassed feels slighted and angry and may be uncooperative in the future.)

5. Unity of Direction: the creation of one plan of action to guide managers and workers as they use organisational resources. He believed that an organisation without a single guiding plan becomes inefficient;
its activities become unfocused and individuals and groups work at cross-purposes)

6. Subordination of Individual interest to General: Fulfilling the organisations needs prevails over meeting the individual or departmental needs. (He said that equitable agreements must be
established between the organisation and its members to ensure that employees are treated fairly and rewarded for their performance).

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Fayols 14 Principles
7. Remuneration: Fayol described various methods eg
1. 2. 3. Schemes for individuals and groups Piece-time rates Profit sharing

8. Centralisation: vs Decentralisation depends on the situation and the size of the organisation. (he was one of the first
management writers to focus on centralisation, the concentration of authority at the top of the managerial hierarchy. He believed that authority should not be concentrated at the top of the chain of command because it can lower the motivation of lower and first-line managers and make them less flexible and they become reluctant to make any decisions on their own, even when necessary.)

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Fayols 14 Principles
9. Scalar Chain: (Line of Authority) Hierarchical Chain of Authority and Communication from top to bottom. Also a
horizontal link in the chain so that communication takes place between different people in different parts of the organisation. He understood that the greater the number of levels in the hierarchy, the longer the communication between managers at the top & bottom and the slower the pace of planning and organising.

10. Order: Everything has a place in the organisation - eg offices to be housed in pre-designated areas; kept clean & tidy. He devised Organisational Charts to help locate people in their place in the
organisation.

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Fayols 14 Principles
11. Equity: Fairness went beyond the legal aspect organisations should manage within the spirit of the law
(Fayol wrote: for personnel to be encouraged to carry out their duties with all the devotion and loyalty of which they are capable, they must be treated with respect for their own sense of integrity, and equity results from the combination of respect and justice

12. Stability of tenure: as training managers is expensive

13. Initiative: Taking the Initiative and using your discretion everyone in the org. should be asked to contribute to plans and ideas. He said it took confident managers to encourage the initiatives of subordinates.
14. Esprit de Corps: considered here the need for harmony and teamwork not divide and rule Policy, encouraging conflict.

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Fayols Functions of Management

Plan Setting goals and objectives for organizations and showing how these goals and objectives are to be accomplished.

Organize Once a plan is made, organizing becomes meaningful - bringing together resources - people, capital, equipment, in the most effective way to accomplish the goals. Organizing, therefore, involves integration of resources.

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Fayols Functions of Management

Leading Plays a large part in determining the level of performance of employees, which in turn influences how effectively the organizational goals will be met.

Control Involves feedback of results and follow-up to compare accomplishments with plans and to make appropriate adjustments where outcomes have deviated from expectations.

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And finally,

Fayols Business Activities

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Criticisms of Fayol
Universal Principles do not take account of variations in the environment, technology or personnel which may require alternative management action. There is no 'one best way' to structure or manage an organisation. FAYOL, who came after Taylor, developed the 'Top Down' view of organization rather than a 'Bottom Up', factory floor view.
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Criticisms of Fayol
Definitions of Management
J P Kotter (1982), in an article entitled "What effective general managers really do" suggests that effective managers to not function in a crisply defined environment, or direct through formally delineated organizational channels, or systematically set and follow a formal plan. He suggests that a rather large gap exists between the conventional wisdom on management functions (FAYOL) and systems on the one hand and actual managerial behaviour on the other. Actual behaviour looks less systematic, more informal, less reflective, more reactive, less well organized and more frivolous than a student of strategic planning systems would ever expect.
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Criticisms of Fayol
Definitions of Management
Fayol in the 1920s Management has been traditionally defined as getting things done by, with and through people by Planning, Leading, Organising and Controlling.

Peter Drucker wrote (l954) "The Practice of Management" - that a Manager is the 'conductor of a symphony orchestra, through whose efforts, vision and leadership, individual instrumental parts, that are so much noise by themselves, become the 43 living whole of music."

Criticisms of Fayol
Definition of Management Leonard R Sayles (l964)
wrote that "management is like a symphony orchestra conductor, endeavouring to maintain melodious performance ... while the orchestra members are having various personal difficulties, stage hands are moving music stands; alternating excessive heat and cold are creating audience and instrument problems, and the sponsor of the concert is insisting on irrational changes in the programme."

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4. Human Relations
Behavioural Management
Early advocates of the classical management perspective viewed organisations and jobs from a mechanistic point of view ie they essentially sought to conceptualize organizations as machines and workers as cogs within those machines. Their focus tended to be on how managers could control and standardize the behaviour of their employees.
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4. Human Relations
Behavioural Management

In contrast, the Human Relations approach placed much more emphasis on individual attitudes and behaviours and how people behave within groups.

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4. Human Relations
Behavioural Management
Emphasized individual attitudes and behaviors, and group processes eg group cohesion/norms..
Looked at how social & psychological factors influence performance Emerged from a research study that began as a scientific management application to determine the impact of working conditions on performance and ended up discovering the effect of the human factor on productivity.
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 A number of different experiments were carried out by Elton Mayo and Associates in Western Electric (now AT&T) (19271935) in the USA:
1. The Illumination Experiments (1924-27) 2. Relay Assembly Room Experiments (1927-32) 3.The Bank Wiring Observation Room Experiments (1931-32)

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Hawthorne Experiments
Elton Mayo (1880-1949)
Started as a Scientific Management application to determine the impact of working conditions on performance and ended up discovering the effect of the human factor on productivity. The studies are divided into 3 main phases:
Illumination Experiments 2 groups of women examine how level of lighting affected worker output. OUTCOME: Workers aware of being observed and enjoyed the improved participation in the work. Workers derived a sense of importance from being asked to take part in the experiment.: phenomenon became known as the Hawthorne Effect. Relay Assembly Test Room Experiments 6 women 48hr wk, no tea breaks gave them more breaks then removed all improvements output was still high. OUTCOME: Supervisory Style; Workers had more control; Level of involvement. Bank Wiring Room Study 14 men peer pressure had an impact on performance; mgt realised that the informal organisation existed within the formal organization (see h/o)
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 The Human Relations Movement

Grew out of the Hawthorne studies. Proposed that workers respond primarily to the social context of work, including social conditioning, group norms, and interpersonal dynamics. Assumed that the managers concern for workers would lead to increased worker satisfaction and improved worker performance.

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Human Relations Proponents

Abraham Maslow
Advanced a theory that employees are motivated by a hierarchy of needs that they seek to satisfy.

Douglas McGregor
Proposed Theory X and Theory Y concepts of managerial beliefs about people and work.

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Maslows Hierarchy of Needs

Self Actualisation (Achievement)
Esteem (Status) Social (Friendship) Safety (Stability) Physiological (Food)
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The lowest unmet need is the prime motivator

MASLOW in the Workplace

Challenging Job assignments Discretion over core work activities Regular positive feedback Prestige job titles Promotions Company sports & social clubs Informal activities Encouraging open communications Private health insurance cover Attractive pension provisions Safe Working Conditions Good Working Conditions Attractive Wage/Salary; Subsidized canteen..

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Criticisms of Maslows Theory

Too rigid how can you predict when one need is satisfied and move on to the next one? Some people seek self-actualisation at the expense of love Traumatic experiences at one level can affect an individuals thinking so that they become blocked at one level of the hierarchy. Lengthy deprivation of a particular need may lead the individual to over-emphasise that need. Emphasis placed on each need may change with time, age and experience. We pursue several needs at the same time. 54

Criticisms of Maslows Theory

One goal may satisfy a number of needs eg buying a car/transport and impressing neighbours satisfies esteem and relationships.. It is difficult to apply a general framework to describe human behaviour. The theory is difficult to apply to the workplace Researchers have found little support for the concept that individuals have completely separate needs.
Theory attempts to demonstrate an imputed rationality in 55 human actions that may not exist.

Theory X and Theory Y

Theory X Assumptions

1. People do not like work and try to avoid it. 2. People do not like work, so managers have to control, direct, coerce, and threaten employees to get them to work toward organizational goals. 3. People prefer to be directed, to avoid responsibility, and to want security; they have little ambition. 1. People do not naturally dislike work; work is a natural part of their lives. 2. People are internally motivated to reach objectives to which they are committed. 3. People are committed to goals to the degree that they receive personal rewards when they reach their objectives. 4. People will both seek and accept responsibility under favorable conditions. 5. People have the capacity to be innovative in solving organizational problems. 6. People are bright, but under most organizational conditions their potential is underutilized.
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Theory Y Assumptions

Douglas McGregor XorY?

Two extreme sets of beliefs that different managers have about their workers. McGregor felt that Theory Y was a more appropriate philosophy for managers to adhere to. Self-fulfilling prophecy (is a prediction that directly or indirectly causes itself to become true) if you believe staff are lazy they will become lazy and so on . So, your assumption about the nature of man at work has an impact on their performance. Does satisfaction at work lead to better performance or does satisfaction follow good performance rather than precede it? It is now believed that human behaviour in organizations is much more complex than the human relationists realized.. 57

Behavioural Management Today

Contribution
Challenged the view that employees are tools and furthered belief that employees are valuable resources.

Limitation
Concepts are not used because managers are reluctant to adopt them.

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The Classical Approaches: a summary

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Kinds of Managers by Level and Area

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Kinds of Managers by Level

Top Managers
are the small group of executives who manage the overall organization. They create the organizations goals, overall strategy, and operating policies.

Middle Managers
are primarily responsible for implementing the policies and plans of top managers. They also supervise and coordinate the activities of lower level managers.

First-Line Managers
supervise and coordinate the activities of operating employees.

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Kinds of Managers by Area

Marketing Managers Human Resources Managers

Financial Managers

Kinds of Managers by Area

Administrative Managers

Operations Managers

Specialist Managers

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Kinds of Managers by Area

Marketing Managers
work in areas related to getting consumers and clients to buy the organizations products or servicesnew product development, promotion, and distribution.

Financial Managers
deal primarily with an organizations financial resourcesaccounting, cash management, and investments.

Operations Managers
are involved with systems that create products and services production control, inventory, quality control, plant layout, site selection.
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Kinds of Managers by Area (contd)

Human Resources Managers
are involved in human resource activities.

Administrative Managers
are generalists familiar with all functional areas of management and are not associated with any particular management specialty.

Other Kinds of Managers

hold specialized managerial positions (e.g., public relations managers) directly related to the needs of the organization.

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Basic Managerial Roles and Skills

Regardless of level or area, all managers must play certain roles and exhibit specific skills in order to be successful. Managers:
Do certain things. Meet certain needs. Have certain responsibilities.
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Lights, Roll Camera, Manage !!!

Interpersonal Roles Informational Roles

Managerial Roles

Decisional Roles

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Ten Basic Managerial Roles

Category Interpersonal Role Figurehead Leader Liaison Informational Monitor Disseminator Spokesperson Decisional Entrepreneur Disturbance handler Resource allocator Negotiator Sample Activities Attending ribbon-cutting ceremony for new plant/attending employee wedding Encouraging employees to improve productivity Interacting with peers from other areas of the org. Scanning industry reports to stay abreast of developments/Tracks dev in Business Environment Sending memos outlining new organizational initiatives Making an address at a breakfast meeting Creating a new business project Resolving conflict between two subordinates over eg work allocation Reviewing and revising budget requests/making decisions about staff deployment Reaching agreement with a key supplier or Trade Union
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What Skills Do Managers Need?

Technical

Interpersonal

Conceptual

Diagnostic

Fundamental Management Skills

Communication

Decision Making

Time Management

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Managerial Skills
Technical
To accomplish or understand the specific kind of work being done in an organization.

Interpersonal
To communicate with, understand, and motivate both individuals and groups.

Conceptual
Conceptual skills are skills that utilize the ability of a human to form concepts (ideas). Such skills include thinking creatively, analysing complex situations, and solving problems.

Diagnostic
To visualize the appropriate response to a situation.

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Managerial Skills (contd)

Communication
To convey ideas and information effectively to others and to receive the same effectively from others.

Decision-Making
To recognize and define problems and opportunities and then to select an appropriate course of action to solve problems and capitalize on opportunities.

Time-Management
To prioritize work, to work efficiently, and to delegate appropriately.

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Management skills at different levels

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Sources of Management Skills

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