Module 1:-Overview of management

Definition of Organization TheoryOrganization theory: is the set of propositions (body of knowledge) stemming from a definable field of study which can be termed organizations science (Kast&Rosenzweig1970).The study of organizations: is an applied science because the resulting knowledge is relevent to problem solving or decision making in ongoing enterprises or institutions (Kast&Rosenzweig1970).

Course Objective: The objective of this course is to familiarize the students with theoretical concepts of modern Economic Analysis so that they can use these as inputs in Managerial Decision making process. The emphasis should be laid on the understanding of key Economic Variables both at micro and macro levels, which influence the business operations and strategies of the firm and business environment under which they operate.

Topic to be covered:- Overview of Management Classical approach Neo Classical Approach Systems Approach to Management Contingency Approach Management and Managerial Roles Practice and Study of Management Challenges of Management in the 21st century

Evolution Of Management ThoughtClassical ApproachesContemporary Approaches

The purpose of studying various schools of management thought is to enable you to recognise and appreciate how developments in the field of management could contribute to current practices. Management does not have a unique body of knowledge. The theories and precepts of management have been adopted from other disciplines and applied to real life situations, with a clear focus on performance of managerial roles

SCHOOLS OF MANAGEMENTManagement has been practiced in some form or the other since the dawn of civilization. Ever since human beings started living and working together in groups, techniques of organisation and management were evolved. The Pyramids of Egypt, the Chinese Wall, the Roman Catholic Church and other such wonders could not be possible without the application of management principles and techniques.

Despite ancient origins, very little conceptual and organized body of knowledge could be developed until the end of 19th century. A scientific and systematic study and application of management began mainly after the Industrial Revolution. Since then the development of management thought has been quite rapid. Management has evolved and changed considerably over a period of time. It has continuously adopted new theories and practices and replaced old ones so as to make management activity increasingly efficient. The universal theory of management evolved in the early twentieth century has been replaced by a number of contingency theories currently in vogue. In the early twentieth century, the focus was on physical factors, viewed from industrial, engineering and economic perspectives..

Subsequently, the focus shifted to productivity, with an emphasis on human factors. Management has evolved and changed considerably over a period of time. It has continuously adopted new theories and practices and replaced old ones so as to make management activity increasingly efficient. The universal theory of management evolved in the early twentieth century has been replaced by a number of contingency theories currently in vogue. In the early twentieth century, the focus was on physical factors, viewed from industrial, engineering and economic perspectives. Subsequently, the focus shifted to productivity, with an emphasis on human factors. Managerial accounting and classical concepts of personnel and finance management were emphasized

The main stages in this development can be classified as follows:Classical approachNeo-classical approachSystems approachContingency approach

1.1 CLASSICAL APPROACHThe classical approach to management is also known as Functional Approach, Empirical Approach or Management Process Approach. Its salient features are as follows:Management is viewed as a systematic network (process) of interrelated functions. The nature and content of these functions, the mechanics by which each function is performed and the interrelationship between these functions is the core of the classical approach.

The Classical school of thought began around 1900 and continued into the 1920s. Traditional or classical management focuses on efficiency and includes bureaucratic, scientific and administrative management. Bureaucratic management relies on a rational set of structuring guidelines, such as rules and procedures, hierarchy, and a clear division of labor. Scientific management focuses on the "one best way" to do a job. Administrative management emphasizes the flow of information in the operation of the organization

On the basis of experiences of experiences of practicing managers, principles are developed. These principles are used as guidelines for the practicing executive and basis of management training.Functions, principles and skills of management are considered universal. They can be applied in different situations.Formal training and education is emphasized for developing managerial skills in would be managers. Case study method is often used for this purpose..

Emphasis is placed on economic efficiency and the formal organisation structure.People are motivated by economic gains. Therefore, organisations control economic incentives.The classical scientific branch arose because of the need to increase productivity and efficiency. The emphasis was on trying to find the best way to get the most work done by examining how the work process was actually accomplished and by scrutinizing the skills of the workforce. .

Uses and LimitationsThe classical approach offers a convenient framework for the education and training of managers. First, the observational method of case study is helpful in drawing common principles out of past experiences with some relevance for future application.The second merit of this approach is that it focuses attention on what managers actually do. Thirdly, this approach highlights the universal nature of management. Fourthly it provides a scientific basis for management practice. It also provides a starting point for researchers to verify the validity and to improve the applicability of management knowledge. Such knowledge about management is effectively presented. Classical approach provides a foundation on which the science of management can be built.

Classical/scientific approachesApproach Specialised efficiency-oriented systems of managementTiming From the turn of the century, well into the 1930s. A legacy of the Industrial Revolution and the social structure of the times: a potentially large workforce of relatively uneducated, disempowered people.Management principles Hierarchical systems based on principles of specialisation, centralisation and formality. Specialised tasks exist in specialised departments, with responsibility formally designated. Span of control is narrow and a unitary line of command is in place.Relevance Great benefits from a consumer viewpoint, with the availability of a wide range of consumer goods. Problems centred on the dehumanising, autocratic nature of the efficiency-driven system and the assumption that the needs of workers matched those of management.

Limitations of classical theoryFirst, it offers a mechanistic framework that undermines the role of human factor. Secondly, the environmental dynamics and their effect on management have been discounted . Thirdly, there is a positive danger in relying too much on past experiences because a principle or technique found effective in the past may not fit a situation in the future. Fourthly the totality of the real situation can seldom be incorporated in a case study. Lastly, the classical approach is based on over-simplified assumptions. Its principles are ambiguous and contradictory.

Scientific management focuses on worker and machine relationships. Organizational productivity can be increased by increasing the efficiency of production processes. The efficiency perspective is concerned with creating jobs that economize on time, human energy, and other productive resources. Jobs are designed so that each worker has a specified, well controlled task that can be performed as instructed. Specific procedures and methods for each job must be followed with no exceptions.

Scientific management was a theory of management that analyzed and synthesized workflows. Its main objective was improving economic efficiency, especially labor productivity. The core ideas of the theory were developed by Frederick Winslow Taylor in the 1880s and 1890s, and were first published in his monographs Shop Management (1903)[1] and The Principles of Scientific Management (1911).[2] While working as a lathe operator and foreman, Taylor noticed the natural differences in productivity between workers, which were driven by various causes, including differences in talent, intelligence, or motivations. He was one of the first people to try to apply science to this application, that is, understanding why and how these differences existed and how best practices could be analyzed and synthesized, then propagated to the other workers via standardization of process steps.

He believed that decisions based upon tradition and rules of thumb should be replaced by precise procedures developed after careful study of an individual at work, including via time and motion studies. Scientific management's application was contingent on a high level of managerial control over employee work practices. This necessitated a higher ratio of managerial workers to laborers than previous management methods. It also caused interpersonal friction between workers and managers, and social tensions between the blue-collar and white-collar classes.

Scientific management is often called Taylorism; the terms are often considered synonymous. A discerning view considers Taylorism as the first form of scientific management, which was followed by new iterations. Taylor's own early names for his approach included "shop management" and "process management". When Louis Brandeis coined the term "scientific management", Taylor recognized it as another good name for the concept, and he used it himself in his 1911 monograph. The field comprised the work of Taylor; his disciples (such as Henry Gantt); other engineers and managers (such as Benjamin S. Graham); and other theorists, such as Max Weber. It is compared and contrasted with other efforts, including those of Frank Gilbreth, Sr. and Lillian Moller Gilbreth (whose views originally shared much with Taylor's but later evolved divergently in response to Taylorism's inadequate handling of human relations). called by other names

Taylorism proper became obsolete by the 1930s, and by the 1960s the term "scientific management" had fallen out of favor for describing current management theories. However, many aspects of scientific management have never stopped being part of later management efforts. Scientific management is a variation on the theme of economic efficiency; it is a late 19th and early 20th century instance of the larger recurring theme in human life of increasing efficiency, decreasing waste, and using empirical methods to decide what matters, rather than uncritically accepting pre-existing ideas of what matters.

Thus it is a chapter in a larger narrative that includes many ideas and fields, from the folk wisdom of thrift to a profusion of applied-science successors, including time and motion study, the Efficiency Movement (which was the broader cultural echo of scientific management's impact on business managers specifically), Fordism, operations management, operations research, industrial engineering, manufacturing engineering, logistics, business process management, business process reengineering, lean manufacturing, and Six Sigma.

Principles of Scientific ManagementThe basic principles of scientific management are as follows:Develop a true science for each element of a workers job to replace rule of thumb method: Each element of a job and the motions required to perform it should be scientifically analyzed to determine and use the most efficient ways of doing it. Intuition, experience and hit or miss methods are replaced by scientific methods.Job specialization or division of labour should be part of each job. Every worker should concentrate on the function so that he can become a specialist in it. Taylor suggested an almost equal division of the work and the responsibility between the management and the workers.

He asserted that management should assume exclusive responsibility for planning and workers should assume doing, i.e. performing work as per instructions of management. In this way Taylor distinguished the roles and responsibilities of management from those of workers.Scientific Selection, training and development of workers: Proper selection of employees best suited for the job would improve productivity. Scientific training should be arranged to develop each employee to his greatest efficiency and prosperity. First, the qualifications required for each job be clearly specified. These should be used as the basis for selection and training of employees. When a worker works on a job for which he is both physically and mentally fit, he can earn higher wages and mental satisfaction.

Close co-operation between management and workers to ensure that work is being done in accordance with the principles of scientific management. Harmonious relationship between management and labour is necessary for complete harmony of interests Taylor advocated a complete mental revolution on the part of both managers and workers. Managers should adopt an enlightened attitude and share the gains of productivity with workers. Workers on their part should work with discipline and loyalty.

Maximum output in place of restricted output. Conflict between management and labour arises mainly on division of surplus. Taylor suggested that the best way to resolve the problem is to increase the size of surplus so that each side can have a larger share. In other words, Taylor believed that management and labour have a common interest in increasing productivity.

To sum up, Taylors principles:Science, not rule of thumbHarmony, not discordMaximum output, in place of restricted output.Development of each man to his greatest efficiencyMaximum prosperity of employer, coupled with maximum prosperity of each employee.Co-operation not individualism.

Contributions of scientific theory:-Improved factory productivity and efficiencyIntroduced scientific analysis to the workplacePiecerate system equated worker rewards and performance.

LimitationsSimplistic motivational assumptionsWorkers viewed as parts of a machinePotential for exploitation of laborExcluded senior management tasks

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In 1911, Frederick Taylor, known as the Father of Scientific Management, published Principles of Scientific Management in which he proposed work methods designed to increase worker productivity. According to F.W Taylor, Scientific management is the art of knowing exactly what you want men to do and seeing that they do it in the best and the cheapest way.

In order to implement the above principles, Taylor and his associates developed the following techniques:Time StudyIt is a technique which enables the manager to ascertain standard time taken for performing a specified job. Every job or every part of it is studied in detail. _ This technique is based on the study of an average worker having reasonable skill and ability .

- Average worker is selected and assigned thejob and then with the help of a stop watch, time is ascertained for performing that particular job. - Taylor maintained that Fair days work should be determined through observations, experiment and analysis by keeping in view an average worker .

Standard Time Working Hours = Fair Days Work

Motion StudyIn this study, movement of body and limbs required to perform a job are closely observed. In other words, it refers to the study of movement of an operator on machine involved in a particular task. The purpose of motion study is to eliminate useless motions and determine the bet way of doing the job. By undertaking motion study an attempt is made to know whether some elements of a job can be eliminated combined or their sequence can be changed to achieve necessary rhythm. Motion study increases the efficiency and productivity of workers by cutting down all wasteful motions.

Functional Foremanship

Taylor advocated functional foremanship for achieving ultimate specification. This technique was developed to improve the quality of work as single supervisor may not be an expert in all the aspects of the work. Therefore workers are to be supervised by specialist foreman. The scheme of functional foremanship is an extension of principle pf specialization at the supervisory level. Taylor advocated appointment of 8 foramen, 4 at the planning level & other 4 at implementation level.

The names & function of these specialist foremen are: - Instruction card clerk concerned with tagging down of instructions according to which workers are required to perform their job Time & cost clerk is concerned with setting a time table for doing a job & specifying the material and labor cost involved in it. Route clerk determines the route through which raw materials has to be passed.

Shop Disciplinarians are concerned with making rules and regulations to ensure discipline in the organization. Gang boss makes the arrangement of workers, machines, tools, workers etc. Speed boss concerned with maintaining the speed and to remove delays in the production process. Repair boss concerned with maintenance of machine, tools and equipments. Inspector is concerned with maintaining the quality of product.

StandardizationIt implies the physical attitude of products should be such that it meets the requirements & needs of customers. Taylor advocated that tools & equipments as well as working conditions should be standardized to achieve standard output from workers. Standardization is a means of achieving economics of production.

It seems to ensure The line of product is restricted to predetermined type, form, design, size, weight, quality. Etc There is manufacture of identical parts and components. Quality & standards have been maintained. Standard of performance are established for workers at all levels.

Differential Piece Wage Plan

This tech of wage payment is based on efficiency of worker. The efficient workers are paid more wages than inefficient one. On the other hand, those workers who produce less than standard no. of pieces are paid wages at lower rate than prevailing rate i.e. worker is penalized for his inefficiency. This system is a source of incentive to workers who improving their efficiency in order to get more wages.

It also encourages inefficient workers to improve their performance and achieve their standards. It leads to mass production which minimizes cost and maximizes profits. Other TechniquesVarious other techniques have been developed to create ordeal relationship between management and workers and also to create better understanding on part of works. Those includes use of instruction cards, strict rules & regulations, graphs, slides, charts etc, so as to increase efficiency of workers.

Critical evaluationAlthough it is accepted that the scientific management enables the management to put resources to its best possible use and manner, yet it has not been spared of severe criticisms.

Workers Viewpoint: Unemployment - Workers feel that management reduces employment opportunities from them through replacement of men by machines and by increasing human productivity less workers are needed to do work leading to chucking out from their jobs.

Exploitation - Workers feel they are exploited as they are not given due share in increasing profits which is due to their increased productivity. Wages do not rise in proportion as rise in production. Wage payment creates uncertainty & insecurity (beyond a standard output, there is no increase in wage rate). Monotony - Due to excessive specialization the workers are not able to take initiative on their own. Their status is reduced to being mere cogs in wheel. Jobs become dull. Workers loose interest in jobs and derive little pleasure from work.

Weakening of Trade Union - To everything is fixed & predetermined by management. So it leaves no room for trade unions to bargain as everything is standardized, standard output, standard working conditions, standard time etc. This further weakens trade unions, creates a rift between efficient & in efficient workers according to their wages. Over speeding - the scientific management lays standard output, time so they have to rush up and finish the work in time. These have adverse effect on health of workers. The workers speed up to that standard output, so scientific management drives the workers to rush towards output and finish work in standard time.

Employer's Viewpoint:Expensive - Scientific management is a costly system and a huge investment is required in establishment of planning dept., standardization, work study, training of workers. It may be beyond reach of small firms. Heavy food investment leads to increase in overhead costs. Time Consuming - Scientific management requires mental revision and complete reorganizing of organization. A lot of time is required for work, study, standardization & specialization. During this overhauling of organization, the work suffers.

Some experts believe that Taylors contribution has been somewhat over-emphasised .The originality of his ideas has been doubted. Business managers have opposed the idea of replacing judgment with prefabricated techniques. The term scientific management is not acceptable to many persons, because it is nothing but a scientific approach to management.In the final analysis, Taylor made a lasting contribution to making jobs and their management more efficient and productive. Scientific management was developed by engineers and scientists and their concern for efficiency led to better methods and tools. Many of the Taylors contributions provide the essence of modern management practice

According to Peter Drucker scientific management is one of the great liberating and pioneering insights. Without it a real study of human beings at work would be impossible. Taylor laid the foundation of modern management as a science. He is therefore, rightly known as the father of scientific management.

ADMINISTRATIVE THEORY (1841-1925)One of the first and the foremost contributors to administrative management theory was Henry Fayol, a French industrialist. Fayol started his career as mining engineer and later became a chief executive. He published his famous book Administration Industrielle et Generale in 1916.It was published in English under the title General and Industrial Management in 1949Fayol's legacy is his generic Principles of Management. Of Fayol's six generic activities for industrial undertakings (technical, commercial, financial, security, accounting, managerial), the most important were the five functions of Management that focused on the key relationships between personnel and its management.

The Five Functions are:PLANNINGPlanning is the most basic or primary function of management. It precedes other functions because a manager plans before he acts. Planning involves determining the objectives and selecting a course of action to achieve them. It implies looking ahead and deciding in advance what is to be done, when and where it is to be done and by whom it is to be done. Planning is a mental process requiring the use of intellectual faculties, foresight, imagination and sound judgment. It consists of forecasting, decision-making and problem solving

A plan is a predetermined future course of action. Drawing up plans of actions that combine unity, continuity, flexibility and precision given the organisation's resources, type and significance of work and future trends. Creating a plan of action is the most difficult of the five tasks and requires the active participation of the entire organisation. Planning must be coordinated on different levels and with different time horizons.

Planning is one of the most important project management and time management techniques. Planning is preparing a sequence of action steps to achieve some specific goal. If you do it effectively, you can reduce much the necessary time and effort of achieving the goal. A plan is like a map. When following a plan, you can always see how much you have progressed towards your project goal and how far you are from your destination. Knowing where you are is essential for making good decisions on where to go or what to do next.

Planning is also crucial for meeting your needs during each action step with your time, money, or other resources. With careful planning you often can see if at some point you are likely to face a problem. It is much easier to adjust your plan to avoid or smoothen a coming crisis, rather than to deal with the crisis when it comes unexpected .Planning enables civic leaders, businesses, and citizens to play a meaningful role in creating communities that enrich people's lives.

Good planning helps create communities that offer better choices for where and how people live. Planning helps communities to envision their future. It helps them find the right balance of new development and essential services, environmental protection, and innovative change.Planning is done in many arenastransportation, housing, health,neighborhood development, urban design, environment, disasterprevention. Planners work in every state and around the world.They work in rural areas, suburban areas, and large cities. Theyfunction in the public sector within federal, state, and local governments.

ORGANISINGOnce plans are formulated, the next step is that of organizing. Organising is the process of establishing harmonious authority-responsibility relationships among the members of the enterprise. It is the function of creating a structure of duties and responsibilities. The network of authority-responsibility relationships is known as organization structure. Such a structure serves as the framework within which people can work together effectively for the accomplishment of common objectives.

ORGANISINGWhen two or more people get together and agree to coordinate their activities in order to achieve their common goals, an organization has been born. There is really no doubt about the present meaning of organization. Its purpose is to create an arrangement of positions and responsibilities through and by means of which an enterprise can carry out its work. An academic textbook definition of organization can be formulated as follows: a. the responsibilities by means of which the activities of the enterprise are dispersed among the (managerial, supervisory, and specialist) personnel employed in its service; and b. the formal interrelations established among the personnel by virtue of such responsibilities

ORGANISING( contd)Once plans are formulated, the next step is that of organizing. Organising is the process of establishing harmonious authority-responsibility relationships among the members of the enterprise. It is the function of creating a structure of duties and responsibilities. The network of authority-responsibility relationships is known as organization structure. Such a structure serves as the framework within which people can work together effectively for the accomplishment of common objectives.

According to Fayol, To organize a business is to provide it with everything useful to its functioning-raw materials, tools, capital and personnel. A sound organisation helps to avoid duplication of work and overlapping of effort. Providing capital, personnel and raw materials for the day-to-day running of the business, and building a structure to match the work. Organisational structure depends entirely on the number of employees. An increase in the number of functions expands the organisation horizontally and promotes additional layers of supervision .

COMMANDINGOptimizing return from all employees in the interest of the entire enterprise. Successful managers have personal integrity, communicate clearly and base their judgments on regular audits. Their thorough knowledge of personnel creates unity, energy, initiative and loyalty and eliminates incompetence .commanding as a managerial function concerned the personal supervision of subordinates and involved inspiring them to put

COMMANDING(contd) unified effort to achieve objectives. Fayol emphasized the importance of managers understanding the people who worked for them, setting a good example, treating subordinates in a manner consistent with firm policy, delegating, and communicating through meetings and conferences

COORDINATINGUnifying and harmonizing activities and efforts to maintain the balance between the activities of the organisation as in sales to production and procurement to production. Fayol recommended weekly conferences for department heads to solve problems of common interest;Fayol saw the function of coordination as harmonizing all of the various activities of the firm. Most later experts did not retain Fayol's coordination function as a separate function of management but regarded it as a necessary component of all the other management function

CONTROLLINGIdentifying weaknesses and errors by controlling feedback, and conforming activities with plans, policies and instructions. Fayol's management process went further than Taylor's basic hierarchical model by allowing command functions to operate efficiently and effectively through co-ordination and control methods. For Fayol, the managing director overlooked a living organism that requires liaison officers and joint committees.

CONTROLLING(contd)control function in terms of ensuring that everything occurs within the parameters of the plan and accompanying principles. The purpose of control was to identify deviations from objectives and plans and to take corrective action. control is a foreseeing action whereas earlier concept of control was used only when errors were detected. Control in management means setting standards, measuring actual performance and taking corrective action

Fayol gave the following general principles of management:Division of Work. Specialization allows the individual to build up experience, and to continuously improve his skills. Thereby he can be more productive. Authority. The right to issue commands, along with which must go the balanced responsibility for its function. Discipline. Employees must obey, but this is two-sided: employees will only obey orders if management play their part by providing good leadership.

Unity of Command. Each worker should have only one boss with no other conflicting lines of command. Unity of Direction. People engaged in the same kind of activities must have the same objectives in a single plan. This is essential to ensure unity and coordination in the enterprise. Unity of command does not exist without unity of direction but does not necessarily flows from it. Subordination of individual interest (to the general interest). Management must see that the goals of the firms are always paramount. Remuneration. Payment is an important motivator although by analyzing a number of possibilities, Fayol points out that there is no such thing as a perfect system.

Centralization (or Decentralization). This is a matter of degree depending on the condition of the business and the quality of its personnel. Scalar chain (Line of Authority). A hierarchy is necessary for unity of direction. But lateral communication is also fundamental, as long as superiors know that such communication is taking place. Scalar chain refers to the number of levels in the hierarchy from the ultimate authority to the lowest level in the organization. It should not be over-stretched and consist of too-many levels. Order. Both material order and social order are necessary. The former minimizes lost time and useless handling of materials. The latter is achieved through organization and selection. Equity. In running a business a combination of kindliness and justice is needed. Treating employees well is important to achieve equity.

Stability of Tenure of Personnel. Employees work better if job security and career progress are assured to them. An insecure tenure and a high rate of employee turnover will affect the organization adversely. Initiative. Allowing all personnel to show their initiative in some way is a source of strength for the organization. Even though it may well involve a sacrifice of personal vanity on the part of many managers. Esprit de Corps. Management must foster the morale of its employees. He further suggests that: real talent is needed to coordinate effort, encourage keenness, use each persons abilities, and reward each ones merit without arousing possible jealousies and disturbing harmonious relations.

BUREAUCRACY (1864-1920)Max Weber, a German social scientist, analyzed the formation and administration of public bureaucracies, which happen to be the oldest form of organisation. Weber evolved an ideal type of bureaucracys a conceptual model for analytical purposes. His model is characterized by the following features:. Division of work. There is a high degree of specialization or division of labor in a bureaucratic organisation. A task is divided into very specialized jobs and each member performs his specialized function in a predictable manner.

. Rules and Regulations. Detailed and rigorous rules and regulations are laid down to specify and govern the work behavior, rights and duties of job holders. There is rigid adherence to prescribed rules designed to ensure consistency and predictability in work performance. Behavior is subject to discipline and control within the framework of rules. In addition, procedures are laid down for orderly performance of tasks. Hierarchy of Authority. A clearly-defined hierarchy is created by downward delegation of authority. There is distribution of formal position authority to give commands needed for discharging duties at various levels. Each position in the hierarchy covers an area over which it has complete jurisdiction in terms of competence and authority.

Technical competence. Selection and promotion of job-holders are based on their on their technical competence. Qualifications are prescribed for each job/ position. Special training is given to provide knowledge of rules and administrative procedures. Record Keeping. Every decision and action is recorded in a wide array of written documents and preserved in its original and draft form. Impersonal relations. Relations among the members of a bureaucratic organisation are impersonal and formal. Superiors adopt an impersonal attitude in dealing with their subordinates.

Weber visualized bureaucracy as an ideal pattern of organisation because it embodies the advantage of precision, efficiency, competence, objectivity, unity, conformity, discipline and order. According to Weber, Bureaucracy provides an ideal way for harnessing the human and mechanical energy. Real life organisations, both private and public, exhibit varying degrees of bureaucracy. Generally the degree of bureaucracy is higher in governmental and military organisations than in private business and voluntary organisations. Weber sought to improve the performance of socially important organisations.His model has contributed to organizational thinking but it has been criticized due to its inflexibility and its focus in impersonal efficiency rather than on human values and needs.

The Bureaucratic OrganizationMax Weber (18641920)Envisioned an organization managed on an impersonal and rational basis.Goals of the bureaucratic model:SpeedPrecision/accuracyOrderUnambiguity/ no vaguenessContinuityPredictability

Structure of the Bureaucratic ModelDivision of labor (functional specialization)Well-defined hierarchy of authority (centralization of authority)Systems of rules for employees and work proceduresImpersonal organizational relationshipsSelection and promotion solely on competenceCareer employment and well-defined promotion path to top of organizationOrganizational transactions extensively documented

Contributions and Limitations ContributionsPrescriptions for how to manage organizationsSearch for one best way to manage to lead to greater organizational efficiencySpurred additional research into management and organizational systems LimitationsLimited view of employees as resources without social needsPursuit of one best way (universal principles) to manageControl-oriented approach creates an inflexible, mechanistic organization

2 NEO-CLASSICAL APPROACHClassical approach led to more efficient forms of organisation and management. But it failed to recognize the overwhelming role of people in management. Jobs became narrow and workers began to resist the formal and impersonal treatment over-looking their social and psychological needs. This resistance and the need to secure willing cooperation of workers led to the development of neo-classical approach.Neo-classical approach may be analysed in three parts namely, Hawthorne Experiments, Human Relations Movement and Behavioral Approach.

Hawthorne ExperimentsThe Hawthorne Studies (also knows as theHawthorne Experiments) were conducted from 1927 to 1932 at the Western Electric Hawthorne Works in Cicero, Illinois (a suburb of Chicago). This iswhere Professor Elton Mayo examined the impact of work conditions in employee productivity. Elton Mayo started these experiments by examining the physical and environmental influences of the workplace (e.g. brightness of lights, humidity) and later, moved into the psychological aspects (e.g. breaks, group pressure, working hours, managerial leadership) and their impact on employee motivation as it applies to productivity.

The Hawthorne EffectIn essence, the Hawthorne Effect, as it applies to the workplace, can be summarized as "Employees are more productive becausethe employeesknow they are being studied." Elton Mayo's experiments showed an increase in worker productivity was produced by the psychological stimulus of being singled out, involved, and made to feel important. Additionally, the act of measurement, itself, impacts the results of the measurement. Just as dipping a thermometer into a vial of liquid can affect the temperature of the liquid being measured, the act of collecting data, where none was collected before creates a situation that didn't exist before, thereby affecting the results.

The Hawthorne Experiments and Employee MotivationElton Mayo's studies grew out of preliminary experiments at the Hawthorne plant from 1924 to 1927 on the effect of light on productivity. Those experiments showed no clear connection between productivity and the amount of illumination but researchers began to wonder what kind of changes would influence output.Variables Affecting ProductivitySpecifically, Elton Mayo wanted to find out what effect fatigue and monotony had on job productivity and how to control them through such variables as rest breaks, work hours, temperature and humidity. In the process, he stumbled upon a principle of human motivation that would help to revolutionize the theory and practice of management.

Elton Mayo selected two women, and had those two select an additional four from the assembly line, segregated them from the rest of the factory and put them under the eye of a supervisor who was more a friendly observer than disciplinarian. Mayo made frequent changes in their working conditions, always discussing and explaining the changes in advance

Elton Mayo's Conclusions on Job PerformanceElton Mayo came to the following conclusions as a result of the study:The aptitudes of individuals are imperfect predictors of job performance. Although they give some indication of the physical and mental potential of the individual, the amount produced is strongly influenced by social factors. Informal organization affects productivity. The researchers discovered a group life among the workers. The studies also showed that the relations that supervisors develop with workers tend to influence the manner in which the workers carry out directives. Work-group norms affect productivity. The Hawthorne researchers were not the first to recognize that work groups tend to arrive at norms of what is "a fair day's work." However, they provided the best systematic description and interpretation of this phenomenon.

The workplace is a social system. The researchers came to view the workplace as a social system made up of interdependent parts. The worker is a person whose attitudes and effectiveness are conditioned by social demands from both inside and outside the work plant. Informal group within the work plant exercise strong social controls over the work habits and attitudes of the individual worker. The need for recognition, security and sense of belonging is more important in determining workers' morale and productivity than the physical conditions under which he works.

HUMAN RELATIONS MOVEMENTHawthorne Experiments laid the foundation for human relations movement in management. Subsequent research contributed several concepts and techniques of human relations. Human relations school is a socio psychological approach to management. It suggests that a business enterprise is asocial system in which group norms exercise significant influence on the behavior and performance of individuals. Workers cannot be motivated by economic rewards alone. They require social satisfaction at the workplace. Therefore, managers should create such a climate in the organisation that worker can feel happy. Employee counseling, participative decision making, cordial super vision, job enrichment and other techniques have been suggested for keeping workers happy and satisfied.

The human relations school is based on the following ideas:1. The Individual. According to the human relations school, each person is unique. He brings certain attitudes, beliefs, values, skills etc. to the job situation. Therefore an individual is motivated by not only economic factors but by several social and psychological factors.2. The Work Group. Work is a social experience and most workers find satisfaction in social or informal groups. The norms of such groups determine to a great extent the attitude and performance of workers. Therefore, managers should maintain good interpersonal and inter group relations to maximize productivity.

. The leader. As the leader of a work group, a supervisor/manager should provide a pleasant work climate wherein employees are allowed to have a say in the decision making process. He can gain respect and obedience by adjusting to various personalities and situations. The work environment. A positive work environment enables employees to satisfy their needs as well as to achieve organizational goals. Positive work environment consists of clearly defined goals, performance linked rewards, feedback on performance, participative decision making, interesting and growth oriented work, open communications, etc.

BEHAVIORAL APPROACHHuman relations movement focused on interpersonal relations and overlooked the wider subject of organizational behavior. Organisational behavior involves the study of attitudes, behavior and performance of individuals and groups in organizational setting. Behavioral approach includes the issue of organizational behavior. It is also known as human resource approach because it stresses development of human beings for the benefit of both the individual and the organisation.

The main propositions of behavioral science approach are as follows:1. An organisation is a sociotechnical system2. Individuals differ in terms of their attitudes, perceptions and value systems. Therefore they react differently to the same situation.3. People working in an organisation have their needs and goals which may differ from the organisations needs and goals. Management should achieve fusion between organizational goals and human needs.4. A wide range of factors influence relations among people.

5. Peoples behavior as individuals may be different from their behavior as members of a group.6. Persons working together in an organisation form their own informal groups. Such groups have their own norms, culture and communication systems.7. Informal groups exercise a significant influence on the attitudes, behavior and performance of employees. Thus behavioral approach is an extension and improvement of human relations movement. It has made significant contribution towards the development of management thought.

Systems approach to management Just as human body is formed of different interdependent systems so is also an organization. A change in any one of these systems may affect all or some other systems to varying degrees. This ripple effect influences the effectiveness of the organization. To understand the interactions and the consequences between the various systems of the organization the managers should posses the ability to get a perspective view. Treating an organization as formed of different systems is known as systems approach

There are two major types of systems: closed and open. A closed system has definite boundaries; it operates relatively independently and is not affected by the environment outside the system. Stand by generator is an example of a closed system. With its different systems working together in perfect harmony the generator continues to supply power as long as it has sufficient fuel supply without much regard to the external environment. An open system as the name implies, is characterised by its interaction with the external environment. Clearly, any business or other organization must be described by an open-system model that includes interactions between the enterprise and its external environment.

CONTINGENCY APPROACHThe contingency approach to management is based on the idea that there is no one best way to manage and that to be effective, planning, organizing, leading, and controlling must be tailored to the particular circumstances faced by an organization. Managers have always asked questions such as "What is the right thing to do? Should we have a mechanistic or an organic structure? A functional or divisional structure? Wide or narrow spans of management? Tall or flat organizational structures? Simple or complex control and coordination mechanisms? Should we be centralized or decentralized? Should we use task or people oriented leadership styles? What motivational approaches and incentive programs should we use?" The contingency approach to management (also called the situational approach) assumes that there is no universal answer to such questions because organizations, people, and situations vary and change over time. Thus, the right thing to do depends on a complex variety of critical environmental and internal contingencies.

CONTINGENCY PERSPECTIVE AND ORGANIZATION THEORYEnvironmental change and uncertainty, work technology, and the size of a company are all identified as environmental factors impacting the effectiveness of different organizational forms. According to the contingency perspective, stable environments suggest mechanistic structures that emphasize centralization, formalization, standardization, and specialization to achieve efficiency and consistency. Certainty and predictability permit the use of policies, rules, and procedures to guide decision making for routine tasks and problems. Unstable environments suggest organic structures which emphasize decentralization to achieve flexibility and adaptability. Uncertainty and unpredictability require general problem solving methods for no routine tasks and problems.

MANAGEMENT AND MANAGERIAL ROLES DEFINITIONS OF MANAGEMENTProduction or Efficiency-oriented Definitions: Those who have put forward the concept of management as a source of efficiency in organization have viewed that management is concerned with generating efficiency in organizational settings.Taylor has defined management as follows:Management is the art of knowing what you want to do and then seeing that it is done in the best and cheapest way

Decision oriented Definitions: Decision-oriented definitions of management have been provided by decision theorists who have seen management process in terms of decision making. A decision oriented definition of management has been provided by Stanley Vance as follows:Management is simply the process of decision making and control over the action of human beings for the expressed purpose of attaining pre-determined goals The decision-oriented definition of management indicates that the basic activity of a manager is to make decisions and enforce these decisions.

People-oriented Definitions: Lawrence Appley has called management as personnel management and has defined it as follows:Management is the accomplishment of results through the efforts of other people.Koontz has defined management in similar way when he says that:Management is the art of getting things done through and with people in formally organized groups

Function-oriented Definitions: These definitions put emphasis on the various functions performed by managers in organizations. McFarland states that Management is defined for conceptual, theoretical, and analytical purposes as that process by which managers create, direct, maintain and operate purposive organizations through systematic, coordinated, cooperative human efforts.

MANAGERIAL ROLESHenry Mintzberg has studied the work roles of the chief executive and has categorized these roles into three areas. These areas are interpersonal relationships, information processing and disseminating and decision making. Each of these areas are further sub divided into various roles. These roles are: (A) Interpersonal Relationships1. Managers role as a figurehead: Managers act as symbolic figurehead performing social or legal obligations. These duties include greeting visitors, signing legal documents, taking important customers to lunch etc.

2. Managers leadership role: Since a manager is responsible for the activities of his subordinates he must motivate them to perform better. He must be an exemplary leader so that his subordinates follow his directions and guidelines with respect and dedication.3. Managers role as a liaison officer: In addition to their constant contact with their own subordinates and peers ,the managers must maintain a network of outside contacts in order to assess the external environment of competition, social changes or changes in government rules and regulations.. An auto assembly plant supervisor may telephone a tire supplier to determine the amount of inventory available for next week; a prosecuting attorney may meet with the presiding judge and defense attorney to discuss the use of motions and evidence in a libel trial.

B. Information Processing1. Managers role as a monitor: A manager assumes the monitor role by continually scanning the environment for information or activities and events that may identify opportunities or threats to the functioning of the work unit. Much of the manager's gathering of information is achieved through the network of contacts that has been established through the interpersonal roles. Hearing small talk at a banquet about a competitor's planned marketing program, learning through casual conversation at a ball game about the negative medical evaluation of an unsigned ball player, or daily reading of a business periodical are all examples of the kinds of information gathering involved in the monitor role.2. Managers role as a disseminator of information: The information a manager gathers as a monitor must be evaluated and transmitted as appropriate to members of the organization. The transmittal of information by a manager activates the disseminator role. Privileged information may be disseminated to subordinates, peers, or superiors in the organization.

Managers role as a spokesman: Occasionally, a manager assumes the role of a spokesperson by speaking on behalf of the work unit to people inside or outside the organization. This might involve lobbying for critical resources or appealing to individuals who have influence on activities that affect the work unit. A top manager asking the board of directors to keep the work unit together during a reorganization period or a corporate president speaking to a college audience on the role the company plays in education would both constitute engaging in the spokesperson role.

Decision Making1. Managers role as an entrepreneur: The entrepreneur role comes into action when the manager seeks to improve the work unit. This can be accomplished by adapting new techniques to fit a particular situation or modifying old techniques to improve individual or group activity. Managers usually learn of new or innovative methods through information gathered in the monitor role. As a result, a supervisor purchases a new kiln which will shorten the drying process for ceramic tiles; a director of a youth club trains staff in the use of personal computers to increase file access; or a president establishes a new pension plan to improve employee morale.

. Managers role as a conflict handler: Whereas the entrepreneur role establishes the manager as the initiator of change, the disturbance handler role establishes the manager as a responder to change. Organizations, unfortunately, do not run so smoothly that managers are never called upon to respond to unwelcome pressures. In these cases, the manager is required to act quickly to bring stability back to the organization. A law partner must settle a disagreement among associates in the firm on who will present a case before a judge; a personnel director must negotiate with striking employees dissatisfied with the procedures for laying off employees; or a cannery first-line manager must respond to a sudden shortage of cans used to package perishable fruit because the supplier has reneged on a contract.

Managers role as resource allocator: When a manager is placed in the position of having to decide to whom and in what quantity resources will be dispensed, the resource allocator role is assumed. Resources may include money, time, power, equipment, or people. During periods of resource abundance, this role can be easily performed by a manager. In most cases, however, organizations operate under conditions of resource scarcity; thus, decisions on the allocation of resources can be critical for the success of the work unit, division, or organization. As a decision maker, the manager must strive not only to appropriately match resources with subordinates but also to ensure that the distribution of resources is coordinated to effectively complete the task to be performed. An office manager must provide secretaries with appropriate equipment to generate and duplicate documents.

Managers role as negotiator: In addition to decisions concerning organizational changes, disturbances, and resources, the manager also enacts as a negotiator .The process of negotiation is possible only when an individual has the authority to commit organizational resources. Hence, as managers move up the managerial hierarchy and obtain control over more resources, they become more involved in the negotiator role. For example, the president of a record company may be called in to discuss terms of a possible contract with a major rock group; a production manager must negotiate with the personnel department to obtain employees with specialized skills; or a college dean must negotiate with department heads over course offerings and the number of faculty to be hired.

PRACTICE AND STUDY OF MANAGEMENTManagement is needed in all types and sizes of organisations, at all organizational levels and in all organizational work areas, and in all organizations, no matter what country they are located in. This is known as the universality of management. Managers in all these settings will plan, organize, lead and control. However, this is not to say that management is done the same way. The differences in what a supervisor in a software applications testing facility at Microsoft does versus what the CEO of Microsoft does are a matter of degree and emphasis, not of function

The Reality of Work:Another reason for studying management is the reality that for most of us, once we graduate from college and begin our career, we will either manage or be managed. For those who plan on management careers, an understanding of the management process forms the foundation upon which to build our management skills. For those of us who dont see ourselves in a management position, we are still likely to have to work with managers. Also, assuming that we will have to work for a living and recognizing that we are likely to work in an organisation, well probably have some managerial responsibilities even if one is not a manager. Our experience tells us that one can gain a great deal of insight into the way one boss.

Rewards of Being a Manager Create a work environment in which organizational members can work to the best of their ability Have opportunities to think creatively and use imagination. Have opportunities to think creatively and use imagination.Help others find meaning and fulfillment of work.Support, coach, and nurture others.Work with a variety of people. Receive recognition and status in organisation and community. Play a role in influencing organizational outcomes Receive appropriate compensation in form of salaries, bonuses and stock options.Good managers are needed by organisations.

Challenges of managersDo hard workHave to deal with a variety of personalities.Often have to make do with limited resources.Motivate workers in chaotic and uncertain situations.Successfully blend knowledge, skills, ambitions and experiences of a diverse work group.Success depends on others work performance.

Challenges of Management in the 21st centuryManagement has been around since the dawn of civilization. In primitive societies almost everyone had to do physical labor. To escape this burden, about the only choices were going into politics (kings) or religion (priests).Civilized urban societies led to more specialization, created new vocational alternatives to manual labor, and saw a tendency of those who did not work with their hands to look down on those who did. This particular attitude was fostered by scribes, who used their knowledge of writing to produce literature that mocked the illiterate laboring classes.

At the start of the 21st century, the following rate to be the most important ideas regarding management: Management is for everyone. As educational levels rise and information technology accelerates, the distinction between "managers" and "workers" will fade away and management knowledge will be everyone's responsibility. Management is for learners. As information becomes the chief product of every business and as knowledge continues to explode, everyone will be a learner and the manager's foremost task will to promote learning.

Management is based on communicating. As techniques for planning, strategizing, decision-making, and problem solving become the common province of everyone in the organization, the need for improving communication will be paramount and managers will be increasingly using dialogue and other communication tools. Management is about change. As technology and information reshape all our lives, change management will be "business as usual" and managers will be change agents who guide everyone to find and embrace the best new practices. Management is broad based. As boundaries disappear within organizations and in the world at large, the scope of management will grow and managers will be organizational development experts, diversity experts, facilitation experts, consultation experts and much else.

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