Theories of Management- UU-MBA712
Management is the administration and organization of tasks to achieve the company objectives. This administration and organization include setting the organization and coordinating employees to achieve its goals with available resources. Management can also refer to staff members’ seniority structure within an organization (Wikipedia.org, 2018). However, today management has similarities with the period of the industrial revolution management, the ongoing organizational transformation; internal/external environment and globalization. Hierarchic, change of technology and the process to the knowledge based organization, have called for broader management approaches other than those dominated during industrial time.
The three primary related processes of management theory today and the past period a; Leadership, controlling, and organizing the business. The best emphasis is on effective leadership is to motivate and instruct assistants- i.e., the business efficiency and develop the business strategically. This processes will lead in decision-making to ensure successful business, Karlof, B. and Loevingsson, F. (2005, P.4).
The classical management was primarily concerned with the structure and activities of the formal organization” (Cole and Kelly, 2005, pp.16). This approach will be majorly to ensure the efficiency of institutions with its objective and productivity. Human Relations approaches will acknowledge social and psychological factors in the organizations. This theory focuses on meeting the social factors, which leads to the success and profitability of the organization and operational works Michaelson (, 2005).
CLASSICAL MANAGEMENT
According to (Safferstone, 2005, pp.4), during industrial revolution time, management theories were a need to assure efficient and effective use of traditional factors of production; Property, Employment, and Wealth due to the evolution of work from independent activities (for example farmers) and to more coordinated action (for example factories).
There are different organization theories to predict and explain the process and behavior patterns in an organizational setting which are listed below;
- Scientific management approach- Frederick Winslow Taylor, 1911.
- Administrative Principles approach- Henri Fayol, 1916.
- Bureaucratic organization approach- Max Weber, 1905.
We will explore the three theories for a comprehensive critical review into management.
- Scientific management principles by Frederick Winslow Taylor
Scientific approach was found in 1911by Frederick Winslow Taylor. He believed management was a science. During this time, Taylors also found that one has to ascertain management with a scientific approach rather than keep only the administration’s decision-making, and he called rule of thumb. Taylor suggested that for efficient performance stated that there were set laws that could be applied to management study and thereby get the desired results. Taylor propounded four principles of scientific management (Taylor, 1919, pp.36-38). Let’s summarized as;
- Carefully support workers preparing their work and smoothing upkeep with them.
- Invest and develop progressively train and teach, to increase productivity with achieve their maximum efficiency in work.
- Carefully select workers with the skills level to the designated work task.
- Promote synergy and trust among employees.
The following opponents of Taylor’s theory;
- Taylor took the employee-employer trust for granted which never existed when it mattered hindering any financial incentive schemes to be ineffective because employees thought that the “management was attempting to ‘pin them down’, and to management’s feelings that the workers had succeeded in ‘pulling the wool over their eyes’ (Cole and Kelly, 2016, pp. 28).
- This approach –based on the low education level of workers back at Taylor’s time- converted the workers to automatons leaving no room for workers to innovate; a perfect case for frustration and job dissatisfaction for a professional worker.
- Taylor regarded the rewarding system –relating to employee motivation- to be only as monetary incentives.
- Work break down into smaller, more straightforward tasks may result in employee dissatisfaction or to be deskilled- a debatable point that Taylor argues that it will increase the task efficiency by repetitively doing the same job.
We state some advantages and disadvantages of scientific management concept that has contributed towards the of organizations;
Advantages of Scientific Management Theory
- Ability to control: The best part of scientific management theorists is that the managers can have good control overproduction. Employees become specialists in their field as they do the same task repeatedly; this makes it easy for the manager to have control over employees.
- Decreases inaccuracy: Inaccuracy decreased as the theory based on experiment and observation for context-specific solutions. With better planning and improved decision making, the accuracy achieved.
- Decreased autocracy: The theory stimulates the management to adopt a positive relationship with leadership. Cooperation amongst employees and managers enhances democracy in the workplace. Hence there decreased autocracy by following scientific management theory.
Disadvantages of Scientific Management Theory
- Requires huge capital: The theory requires an investment of huge capital and consider as a costly system. The establishment of work study, planning department, training of workers, and standardization requires more money.
- Management takes control: The management takes complete responsibility related to the control and planning of workplace activities. Since the managers take up control of the employees, they lack creativity, another reason for this is that since they repeat the same task, their chore is meaningless, monotonous, and tedious which reduces employee motivation.
- Planning reduces productivity: Though the capability to plan is an advantage, the downside of planning is that it makes work inflexible and rigid and may lead to carelessness and dissatisfaction.
- Administrative Principles by Henri Fayol
During the period of the industrial revolution, production changed massively from places to industrial expansions. During the same time, they realized the need to change and create efficient management to combine worker productivity and raw materials efficiently to achieve the goals of the various organizations.
This theory was advanced by Henri Fayol (1841-1925). Fayol was a French Engineer who had worked in the mining industry for over thirty years until he became the company Chief executive officer. Fayol’s theory was focused on the administrative principles of managing an organization’s activities and resources, focusing on the organization as a whole. According to the book” Principles of management,” he identified the main functional areas, namely; control, coordinate, foresight, organizing, and directing. Closely resemble the four functions of management:
- planning refers to the selection and sequential ordering of tasks to be performed to achieve the organization’s goal;
- Organizing refers to putting the organization’s resources into gainful use.
- Leading is the process motivating employees and leading them to influence their behavior to achieve the organization goals.
- Controlling involves measuring the organization’s performance, comparing it with the set standards, identifying the deviations from the proposed plans, and taking the necessary corrective actions to ensure that events conform to the policies.
Furthermore administrative theories come up with fourteen fundamental rules and principles to serve as guidelines for managers. These principles are claiming that his list not exhaustive but aims to act as guidelines for managers towards more efficient services.
Cole and Kelly (2016, pp.25);
- Division of Work; He believed that segregating work in the workforce amongst the worker will enhance the product’s quality. Similarly, he also concluded that the work division improves the productivity, efficiency, accuracy, and speed of the workers.
- Authority and Responsibility– These are the two critical aspects of management. Authority facilitates the command to work efficiently, and responsibility makes them responsible for their work with the leadership control.
- Discipline– This principle is the core value for any project or any management. Without training, nothing can be accomplished. Employees with excellent performance and proper interrelation help the management work high and comprehensive.
- Unity of Command-This means an employee should have only one boss and follow his command. If an employee has to go around with more than one boss, there begins a conflict of interest and can create confusion.
- Unity of Direction- This means all the leaders and team members working in a company should have one goal with a common objective.
- Subordination of Individual Interest– A company should work unified towards a company’s interest rather than personal interest.
- Remuneration- This plays an essential role in motivating the workers of a company. Payment can be monetary or non-monetary. However, it should be according to an individual’s efforts they have made.
- Centralization- It is based on the size of the organization. Power needs to be centralized, so that decision-making process is judicious at all levels.
- Scalar Chain and processes- It’s the chain related to supervisor and subordinates relationship. The organization hierarchy must be a clear line (delegation of authority, action, decision making, and command).
- Order- There must be clean orders and defined work premises due to a conducive work environment.
- Equity– Employees must treat be equally and respectfully. Managers should ensure that there is no discrimination in the organization.
- Stability- when an employee is secured in his job, he/she will deliver the best results. Managers should be responsible for minimizing employee turnover.
- 13. Initiative- Sometimes, the best ideas come from unexpected windows; therefore, managers should encourage and support employees taking actions in the organization.
- Esprit de Corps- This is the core principle. Managers have the responsibility to motive the employees regularly and be supportive. It’s important to develop mutual trust among the team.
Fayol’s suggested that all the activities aimed to achieve the organization’s objectives should be followed under the same manager in the principle of unity of direction. He also proposes that one employee must be monitored one superior, as this would create interpersonal conflicts in the integration law, of course. This theory has been incorporated into the practice of management in modern times for more efficient services.
We will state some advantages and disadvantages that are to consider at Fayol’s Principles of Management. It’s essential to evaluate all the Fayolism advantages and disadvantages. One of the problems, in theory, was developed based solely on his own managerial experiences, which means he didn’t undertake any further research. As a result, he couldn’t fully develop a full understanding of Fayolism’s advantages and disadvantages, believing firmly that his system only produced benefits. On the other hand, considering the advantages and disadvantages of administrative management is that some theories are prisoners of the era in which they were developed. For example, in Fayol’s day, authority and control over employees were the norm. That isn’t the case in modern society, which means you have to revise some of Fayol’s theories to make them more applicable to current standards.
- Bureaucratic organization principles by Max Weber
Max Weber (1864-1920) also known as “the father of sociology” was born in Germany and grew up during the industrialization was transforming government, business, and society. Weber was interested in industrial capitalism, an economic system where industry is privately controlled and operated for profit. Weber wanted to know why industrial capitalism was successful in some countries and not in others. He believed that large-scale organizations such as factories and government departments were a characteristic of capitalist economies.
Max Weber (1864-1920): was a Sociologist. He was described as the father of sociology. In 1904 Weber was studying economy in the United States. During his studies, when he detected the “spirit of capitalism.” Weber also noted that in the United States, capitalism was supporting competition and innovation. He also stated that businesses were administrated by professional managers and connected well connected with the economy.
Furthermore, Max Weber compared this spirit of behavior in his country. He realized that people in the USA are given power based on social relations, linked networks, family, and social relationships linked. In that the lack of experience, he was concerned that power was not a principle of knowledge or ability, but it was influencing the community standing. Weber found that managers faithfully in the organization were failing because of this. The resources were used to benefit owners and managers rather than meet organizational objectives and aims. Weber was assured that the organizations were based on `”rational authority,” where authority was given to the most skilled and qualified employees would be more efficient than those found on who you knew. Weber called this type of rational organization a bureaucracy.
The defining characteristics of Weber rules of a bureaucracy. They are summarized as follows:
- Hierarchical Management Structure- There are well-defined authority and responsibilities in the organization, and following the hierarchy, subordinates reports to a higher-level.
- Division of Labor –Duties are clearly defined, and workers become skilled by specializing in doing one thing.
- Formal Selection Process– There is no nepotism. Recruiting process and promotion activities should be by technical qualifications with evidence of examinations and certification (Colleges, institutions, and Universities).
- Career Orientation-Management is separate from ownership, and managers are career employees. Protection from arbitrary dismissal is guaranteed.
- Formal Rules and Regulations-Written guidelines to ensure reliable and predictable behavior. Managers must depend on formal organizational rules in employee relations.
- Impersonality-Procedures and rules are implemented uniformly to everyone. There is no preferential treatment.
Therefore, he thought that bureaucracy would result in the highest efficiency, rationality, and worker satisfaction. Weber believed that his theory was so logical and will revolutionize humanity, with the advantages of efficiency in utilizing resources. Despite the problems, Weber described the term ‘bureaucracy’ to ration-legal power and dominated moderns’ organizations. The “ pyramid” Administrative organization, with responsibility split into divisions, departments, and teams, is based on bureaucracy principles. Weber’s concluded that recruiting and promoting consistency in work should be on qualifications, not social influences.
In conclusion, Frederick Winslow Taylor, Henri Fayol, and Max Weber management theories are still in use today. Taylor stated that managers should help, encourage, and work with the subordinates to help achieve the organization objectives. Along this same line, Fayol’s management duties helps to understand the managerial functions in the organization. Weber’s bureaucracy rules are updated in most large organizations, in hospitals, prisons, police departments, colleges, and universities.
- HUMAN RELATION APPROACH MANAGEMENT
The theory of Human relation theory acknowledges the social factors and psychological factors. This theory also emphasizes on motivating employees with financial rewards (e.g., Salaries and wages) and productivity factors (e.g., praise, a sense of belonging and feelings of achievement).
Human relation theory was originated between 1927 and 1932, employed Elton Mayo. Elton Mayo started the experiments when he was working at Hawthorne plant of the American Western Electric Company in Chicago. Their also realized that the employee’s productivity was considered a function of work, physical conditions, and salaries paid for a specific job. Mayo also realized that productivity was associated with the satisfaction of employees at work. So, according to their experiments; managers should be concerned with the analysis of organizational behavior (i.e., interaction of people).
Hawthorne stated four main features stages of the Human Relations Approach to management:
Relay assembly test room-This experimental stage working hours, rest, and lunching hours were changed. The observer used a friendly approach, listening to the employees and their complaints. He again noticed the increase in Productivity.
- Illumination experiments- This experiment stage used lighting to analyze the employees’ Productivity, Two groups were arranged one was in control, and the other an experimental.in the end, both group’s Productivity increased even when lighting became poor.
- Interviewing program-This was a crucial experiment that employees felt towards their superiors and found out more about their feelings and behavior regarding the management, supervision , organization , working relations, and employees lives and views. The interview approach was used as a non-directive and non-judgemental manner. The relationships with people affect the worker’s attitudes, which in turn affect the Productivity.
- Bank wiring observation room-This experiment stage the observer changed the working conditions slightly for six months. The employees began to form their own organization and rules with their personal, informal social relations.
Mayo’s concluded that changes had been made in consultation with employees. This factor is determining influence on productivity, together with the fact that the employees had a good working relationship with their supervisors.” (Sutherland & Canwell, 2004, p202-203).Our example is Google -Which applied the behavioral management today. The organization avoids bureaucracy with employees and allows them to use their abilities. Managers and employees work together to create ideas and find the most relevant work.
One example of classical & human relations approaches is the fast-food Chains. We will use McDonald’s as our example. McDonald’s was founded initially as a barbecue restaurant in 1940, and then in 1955 was changed into a chain of fast food (Wikipedia, 2016). We examined McDonald’s code of conduct under their corporate governance standards (McDonald’s, 2016a), similar to Henri Fayol management principles.
According to McDonald’s (2016a, pp.10), Fayol’s principle: Division of work, discipline, management commitment, unity of direction, command of authority, integration of power, remuneration, personal accountability, and subordination all interests to top was implemented. Work was divided among all employees and also the responsibility of the job. The top gives authority to give orders with discipline and accountable for the restaurant’s functioning with objective, McDonald’s (2016a, pp.8).
The principle of Fayol’s existed at the core of the laws of the fast-food and Taylor’s scientific management as well; all tasks have time drawn, and required skills, plans by preparing their food from work are separated. All McDonald’s restaurant will provide their services when you pay for an order and, at approximately the same time, the same ingredients and same taste.
McDonald’s has shown selling proposition and values (practices and policies). The application of classical and human-relations theories of management implemented by McDonald’s in demonstrating “efficient and effective “strategies was significant in today management.
Finally, although some human relations movements argued against Classical & Human Relations, the management structure is observed universal and still in today’s industries. There are famous companies, (i.e., McDonald’s company), that is still used as an essential tool within their business operations.This theories influence today’s contemporary and are commonly used in combination to one another. The evaluation of both approaches in organizations today is very prominent in management.
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