Download - chap002a
-
7/29/2019 chap002a
1/34
2Chapter
PowerPoint Presentation by Charlie Cook Copyright The McGraw-Hill Companies, Inc., 2003. All rights reserved.
The Evolution ofManagement Theory
-
7/29/2019 chap002a
2/34
Copyright McGraw-Hill. All rights reserved. 22
Learning Objectives
After studying the chapter, you should be able to:Describe how the need to increase organizational
efficiency and effectiveness has guided theevolution of management theory.
Explain the principle of job specialization anddivision of labor, and tell why the study of person-task relationships is central to the pursuit ofincreased efficiency.
Identify the principles of administration andorganization that underlie effective organizations.
Trace the change in theories about how managersshould behave to motivate and control employees
-
7/29/2019 chap002a
3/34
Copyright McGraw-Hill. All rights reserved. 23
Learning Objectives (contd)
Explain the contributions of management science tothe efficient use of organizational resources.
Explain why the study of the external environmentand its impact on an organization has become a
central issue in management thought.
-
7/29/2019 chap002a
4/34
Copyright McGraw-Hill. All rights reserved. 24
Chapter Outline
Scientific Management TheoryJob Specialization and the Division of Labor
F. W. Taylor and Scientific Management
The Gilbreths
Administrative Management Theory
The Theory of Bureaucracy
Fayols Principles of Management
Behavioral Management Theory
The Work of Mary Parker Follett
The Hawthorne Studies and Human Relations
-
7/29/2019 chap002a
5/34
Copyright McGraw-Hill. All rights reserved. 25
Chapter Outline (contd)
Behavioral Management Theory (contd)Theory X and Theory Y
Management Science Theory
Organizational Environment TheoryThe Open Systems View
Contingency Theory
-
7/29/2019 chap002a
6/34
Copyright McGraw-Hill. All rights reserved. 26
Scientific Management Theory
Evolution of Modern ManagementBegan in the industrial revolution in the late 19th
century as:
Managers of organizations began seeking ways to
better satisfy customer needs.
Large-scale mechanized manufacturing began to
supplanting small-scale craft production in the ways
in which goods were produced.
Social problems developed in the large groups ofworkers employed under the factory system.
Managers began to focus on increasing the efficiency
of the worker-task mix.
-
7/29/2019 chap002a
7/34 Copyright McGraw-Hill. All rights reserved. 27
The Evolution of Management Theory
Figure 2.1Source:
-
7/29/2019 chap002a
8/34 Copyright McGraw-Hill. All rights reserved. 28
Job Specialization andthe Division of Labor
Adam Smith (18th century economist)
Observed that firms manufactured pins in one oftwo different ways:
Craft-styleeach worker did all steps.
Productioneach worker specialized in one step.
Realized that job specialization resulted in muchhigher efficiency and productivity
Breaking down the total job allowed for the division of
labor in which workers became very skilled at their
specific tasks.
-
7/29/2019 chap002a
9/34 Copyright McGraw-Hill. All rights reserved. 29
F.W. Taylor and Scientific Management
Scientific ManagementThe systematic study of the relationships between
people and tasks for the purpose of redesigning thework process for higher efficiency.
Defined by Frederick Taylor in the late 1800s toreplace informal rule of thumb knowledge.
Taylor sought to reduce the time a worker spent on
each task by optimizing the way the task was done.
-
7/29/2019 chap002a
10/34 Copyright McGraw-Hill. All rights reserved. 210
Four Principles of Scientific Management
Principles to increase efficiency:1. Study the ways jobs are performed now and
determine new ways to do them.
Gather detailed time and motion information.
Try different methods to see which is best.
2. Codify the new methods into rules.
Teach to all workers the new method.
3. Select workers whose skills match the rules.4. Establish fair levels of performance and pay a
premium for higher performance.
Workers should benefit from higher output
-
7/29/2019 chap002a
11/34
Copyright McGraw-Hill. All rights reserved. 211
Problems with Scientific Management
Managers frequently implemented only theincreased output side of Taylors plan.
Workers did not share in the increased output.
Specialized jobs became very boring, dull.
Workers ended up distrusting the ScientificManagement method.
Workers could purposely under-perform.
Management responded with increased use ofmachines and conveyors belts.
-
7/29/2019 chap002a
12/34
Copyright McGraw-Hill. All rights reserved. 212
Frank and Lillian Gilbreth
Refined Taylors work and made manyimprovements to the methodologies of time
and motion studies.
Time and motion studies
Breaking up each job action into its components.
Finding better ways to perform the action.
Reorganizing each job action to be more efficient.
Also studied worker-related fatigue problemscaused by lighting, heating, and the design of
tools and machines.
-
7/29/2019 chap002a
13/34
Copyright McGraw-Hill. All rights reserved. 213
Administrative Management Theory
Administrative ManagementThe study of how to create an organizational
structure that leads to high efficiency andeffectiveness.
Max Weber
Developed the concept of bureaucracy as a formalsystem of organization and administration designedto ensure efficiency and effectiveness.
-
7/29/2019 chap002a
14/34
Copyright McGraw-Hill. All rights reserved. 214
WebersPrinciples of
Bureaucracy
Figure 2.2
-
7/29/2019 chap002a
15/34
Copyright McGraw-Hill. All rights reserved. 215
Webers Five Principles of Bureaucracy
Authority is the power to hold peopleaccountable for their actions.
Positions in the firm should be held based on
performance, not social contacts. Position duties are clearly identified so that
people know what is expected of them.
Lines of authority should be clearly identified
such that workers know who reports to who.
Rules, standard operating procedures (SOPs),
and norms guide the firms operations.
-
7/29/2019 chap002a
16/34
Copyright McGraw-Hill. All rights reserved. 216
Fayols Principles of Management
Division of Labor: allows for job specialization.Fayol noted jobs can have too much specialization
leading to poor quality and worker dissatisfaction.
Authority and Responsibility
Fayol included both formal and informal authorityresulting from special expertise.
Unity of Command
Employees should have only one boss.
-
7/29/2019 chap002a
17/34
Copyright McGraw-Hill. All rights reserved. 217
Fayols Principles of Management (contd)
Line of AuthorityA clear chain of command from top to bottom of
the firm.
Centralization
The degree to which authority rests at the top ofthe organization.
Unity of Direction
A single plan of action to guide the organization.
-
7/29/2019 chap002a
18/34
Copyright McGraw-Hill. All rights reserved. 218
Fayols Principles of Management (contd)
EquityThe provision of justice and the fair and impartial
treatment of all employees.
Order
The arrangement of employees where they will beof the most value to the organization and toprovide career opportunities.
InitiativeThe fostering of creativity and innovation by
encouraging employees to act on their own.
-
7/29/2019 chap002a
19/34
Copyright McGraw-Hill. All rights reserved. 219
Fayols Principles of Management (contd)
DisciplineObedient, applied, respectful employees are
necessary for the organization to function.
Remuneration of Personnel
An equitable uniform payment system thatmotivates contributes to organizational success.
Stability of Tenure of Personnel
Long-term employment is important for thedevelopment of skills that improve theorganizations performance.
-
7/29/2019 chap002a
20/34
Copyright McGraw-Hill. All rights reserved. 220
Fayols Principles of Management (contd)
Subordination of Individual Interest to theCommon Interest
The interest of the organization takes precedenceover that of the individual employee.
Esprit de corps
Comradeship, shared enthusiasm foster devotion tothe common cause (organization).
-
7/29/2019 chap002a
21/34
Copyright McGraw-Hill. All rights reserved. 221
Behavioral Management Theory
Behavioral ManagementThe study of how managers should behave to
motivate employees and encourage them toperform at high levels and be committed to the
achievement of organizational goals.Focuses on the way a manager should personally
manage to motivate employees.
-
7/29/2019 chap002a
22/34
Copyright McGraw-Hill. All rights reserved. 222
Behavioral Management
Mary Parker FollettAn influential leader in early managerial theory
Held a horizontal view of power and authority inorganizations
Suggested workers help in analyzing their jobs for
improvementsthe worker knows the best way to
improve the job.
If workers have relevant knowledge of the task, then
they should control the task.
-
7/29/2019 chap002a
23/34
Copyright McGraw-Hill. All rights reserved. 223
The Hawthorne Studies
Studies of how characteristics of the worksetting affected worker fatigue and
performance at the Hawthorne Works of the
Western Electric Company from 1924-1932.
Worker productivity was measured at various levelsof light illumination.
Researchers found that regardless of whether thelight levels were raised or lowered, worker
productivity increased.
-
7/29/2019 chap002a
24/34
Copyright McGraw-Hill. All rights reserved. 224
The Hawthorne Studies
Human Relations ImplicationsHawthorne effectworkers responded to the
attention they received and were more productive.
Managers should be behaviorally trained to manage
subordinates to elicit their cooperation and increasetheir productivity.
Groups impose informal performance norms ontheir members (both rate busters and chiselers)
Gave rise to the field of Organizational Behavior
The study of the factors that have an impact on how
individuals and groups respond to and act in
organizations.
-
7/29/2019 chap002a
25/34
Copyright McGraw-Hill. All rights reserved. 225
Theory X and Theory Y
Douglas McGregor proposed the two differentsets of assumptions about workers.
Theory X assumes the average worker is lazy,dislikes work and will do as little as possible.
Managers must closely supervise and control throughreward and punishment.
Theory Y assumes workers are not lazy, want to doa good job and the job itself will determine if the
worker likes the work. Managers should allow workers greater latitude, and
create an organization to stimulate the workers.
-
7/29/2019 chap002a
26/34
Copyright McGraw-Hill. All rights reserved. 226
Theory X versus Theory Y
Figure 2.3Source:
-
7/29/2019 chap002a
27/34
Copyright McGraw-Hill. All rights reserved. 227
Management Science Theory
An approach to management that usesrigorous quantitative techniques to maximize
the use of organizational resources.
Quantitative managementutilizes linear
programming, modeling, simulation systems.
Operations managementtechniques to analyzeall aspects of the production system.
Total Quality Management (TQM)focuses on
improving quality throughout an organization.
Management Information Systems (MIS)provides information about the organization.
-
7/29/2019 chap002a
28/34
Copyright McGraw-Hill. All rights reserved. 228
Organizational Environment Theory
Organizational EnvironmentThe set of forces and conditions that operate
beyond an organizations boundaries but affect amanagers ability to acquire and utilize resources.
.
-
7/29/2019 chap002a
29/34
Copyright McGraw-Hill. All rights reserved. 229
The Open-Systems View
Open SystemA system that takes resources for its external
environment and converts them into goods andservices that are then sent back to that
environment for purchase by customers.Inputs: the acquisition of external resources.
Conversion: the processing of inputs into goods andservices.
Output: the release of finished goods into theenvironment.
-
7/29/2019 chap002a
30/34
Copyright McGraw-Hill. All rights reserved. 230
The Organization as an Open System
Figure 2.4
-
7/29/2019 chap002a
31/34
Copyright McGraw-Hill. All rights reserved. 231
Other System Considerations
Closed systemA system that is self-contained and thus not
affected by changes occurring in its externalenvironment.
Often undergoes entropy and loses its ability tocontrol itself, and fails.
Synergy
Performance that results when individuals anddepartments coordinate their actions
Performance gains of the whole surpass the sum of
the performance of the individual components.
-
7/29/2019 chap002a
32/34
Copyright McGraw-Hill. All rights reserved. 232
Contingency Theory
Contingency TheoryThe idea that the organizational structures and
control systems manager choose depend onarecontingent oncharacteristics of the external
environment in which the organization operates.Assumes there is no one best way to manage.
The environment impacts the firm and managers
must be flexible to react to environmental changes.
In rapidly changing organizational environments,managers must find ways to coordinate differentdepartments to respond quickly and effectively.
-
7/29/2019 chap002a
33/34
Copyright McGraw-Hill. All rights reserved. 233
Contingency Theory of Organizational Design
Figure 2.5Source:
-
7/29/2019 chap002a
34/34
Mechanistic and Organic Structures
Mechanistic StructureAuthority is centralized at the top. (Theory X)
Employees are closely monitored and managed.
Can be very efficient in a stable environment.
Organic structure
Authority is decentralized throughout theorganization. (Theory Y)
Tasks and roles are left ambiguous to encourageemployees to react quickly to changingenvironment.