Management Theories || The Nature of Management || Bcis Notes

Management Theories  

Introduction
The impact that management theory and how the basic functions and practice of management as well as the role of the manager and approaches to management have contributed to the practice of emergency management.

Management theory’s current view of stress the changing nature of the external environment and the need to understand and address these external forces for change. The contribution and role of systems theory and contingency theory to the emergency management process are stressed. Management theory provides a sound basis for supporting the emergence of emergency management theory utilizing the management process from planning, organizing, leading and controlling (Fayol 1916, Mintzbert 1973, Katz 1974, Koontz 1984). Taylor (1911) considered management a process and one that “if approached scientifically” would lead to success.

The theory of management has grown over the past one-hundred years evolving from the time and motion studies of engineers to contributions from social scientists, the Hawthorne studies and a behavioral approach to more quantitative approaches that look for the “best” or optimum functioning of an organization or “total quality management(TQM)” (Gabor 1990). Emergency management has been influenced by the same developments in management theory in utilizing engineering to design the most efficient emergency operations center or emergency response routing for emergency services.

1. Historical Theory
   The historical theory is a concept that is used in different ways. Often researchers will have a “theory” about historical events and connections. An orderly preconceived impression of the phenomenon to be studied. Used in this way, “theory” means the same thing as”hypothesis”
   1.1. Conventional management
   The conventional definition of management is getting work done through people, but real management is developing people through work. In this theory, peoples follow the old business of their ancestors and follow the same techniques of business.

• Clear demarcation between the secular and the religious; human activities are separated, the spiritual or religious aspect is a private matter of individuals while work is in the public domain.
• It states to adopt or implement those methods of management which we learn from our past offspring.
• Old methods used in order to continue old generation thoughts towards managing process.
  1.2. Trial and Error Theory
  Learning begins when the organism faces a new and difficult situation a problem. Most learning organism counters errors, and with repeated trials, errors reduce. The phenomenon is called Trial and Error Learning in a simple sense.
• This idea states that kind of management which based on such methods in which tried and faulty ones eliminated in order to find the correct one.
• Process of experimenting with various methods of managing until one finds the most successful.
• Trial and error is a problem-solving method in which multiple attempts are made to reach a solution. It is a basic method of learning that essentially all organisms use to learn new behaviors. Trial and error are trying a method, observing if it works and if it doesn’t try a new method. This process is repeated until success or a solution is reached.    

2. Classical Theory
The Classical Theory is the traditional theory, wherein more emphasis is on the organization rather than the employees working therein. According to classical theory, the organization is considered as a machine and human beings as different components/parts of that machine. The classical approach includes
scientific, administrative & bureaucratic management.

• Professes the body of management thought based on the belief that employees have only economical and physical needs and that the social needs & need for job satisfaction either do not exist or are unimportant.
• It advocates high specialization of labor, centralized decision making & profit maximization.
• Basic Assumption: People Are Rational People will rationally consider the opportunities available to them and do whatever is necessary to maximize their economic gain.

2.1. Main Feature of Classical Management Theories

•  Chain of  Command
• Division of labor
•  Top-down communication
• Autocratic leadership style
• Predicted Behavior

2.2 Scientific Management
Scientific Management focuses on the “one best way” to do a job a systematic study of relationships between people and tasks for the purpose of redesigning the work process to increase efficiency. After the industrial revolution management took another turn. Prominent organizations realized to go into the depth of business processes. Frederick Taylor developed scientific management theory:

• The goal of this theory was to decrease waste, increase the process and methods of  production
• He also introduced the Differential Piece rate system of paying wages to the workers.
• Develop rules of motion, standardized work implements, and proper working conditions for every job.
• To scientifically determine the optimal way to perform a job, Taylor performed experiments that he called time studies, (also known as time and motion studies).
• Scientific management (the Gilbreths)
• Motion study: Science of reducing a job or task to its basic physical motions.
• Eliminating wasted motions improves performance
• Time and motion studies
• 1. Break down each action into components
• 2. Find a better way to perform it.
• Reorganize to be more efficient.
• Gilbreths also studied fatigue problems, lighting, heating, and other worker issues.

Four basic tenets of Scientific Management theory

1. Examine task to determine the most efficient method
2 Train workers to use the developed work method
3 Supervised workers to ensure they use work methods.
4.Allocate responsibility for carrying out work as planned

Strength of the Scientific Management theory:

•  Repetition improves techniques and methods
• Standard working environment People get promoted based on skills and efficiency
• Workers are paid based on quantity output
• Train workers to perform jobs to the best of their abilities

Weakness of the Scientific Management theory:

• People are to be manipulated like machines; Workers not allowed to choose their jobs and method and train themselves
• People get tired, Workers ended up distrusting Scientific Management.
• Workers could purposely “underperform”

2.3. Administrative Management
Administrative Management focuses on the manager & basic managerial functions” emphasized management functions and attempted to generate broad administrative principles that would serve as guidelines for the rationalization of organizational activities.

basic tenets of Administrative Management theory:

• The theory generally calls for a formalized administrative structure, a clear division of labor, and delegation of power and authority to administrators relevant to their areas of responsibilities.
• Sound management practice falls into certain identifiable five functions. These functions are; Plan, Organize, Command, Co-ordinate and Control.

From this insight, he drew up 14 principles

1.Division of Work
When employees are specialized, the output can increase because they become increasingly skilled and efficient.

2.Authority
Managers must have the authority to give orders, but they must also keep in mind that with authority comes responsibility.

3.Discipline
Discipline must be upheld in organizations, but methods for doing so can vary.

4.Unity of Command
Employees should have only one direct supervisor.

5.Unity of Direction
Teams with the same objective should be working under the direction of one manager, using one plan. This will ensure that action is properly coordinated.

6.Subordination of Individual Interests to the General Interest
The interests of one employee should not be allowed to become more important than those of the group. This includes managers.

7.Remuneration
Employee satisfaction depends on fair remuneration for everyone. This includes financial and nonfinancial compensation.

8.Centralization
This principle refers to how close employees are to the decision-making process. It is important to aim for an appropriate balance.

9.Scalar Chain
Employees should be aware of where they stand in the organization’s hierarchy or chain of command.

10.Order
The workplace facilities must be clean, tidy and safe for employees. Everything should have its place.

11.Equity
Managers should be fair to staff at all times, both maintaining discipline as necessary and acting with kindness where appropriate.

12.Stability of Tenure of Personnel
Managers should strive to minimize employee turnover. Personnel planning should be a priority.

13.Initiative
Employees should be given the necessary level of freedom to create and carry out plans.

14.Esprit de Corps
Organizations should strive to promote team spirit and unity.

Strength of the Administrative Management theory

• Workers receive a direct command from one superior which readily gets the job done.
• Workers are encouraged to think through and carry out the plans.
• Encourages group harmony
  Weakness of the Administrative Management theory:
• Managers welcome suggestions but basically stick to the plans
• Personnel training and development are neglected.
• Environment creates the feeling of competition

2.4. Bureaucratic Management
Theory of bureaucratic management
that stressed the need for strictly defined hierarchy, governed by clearly defined regulations and lines of authority. Emphasized the necessity of organizations to operate in a rational way instead of following the “arbitrary whims” or irrational motions and intentions of owners and managers.

• Weber focused on dividing organizations into hierarchies, establishing strong lines of authority and control.
• An ideal, intentionally rational, and very efficient form of organization Based on principles of logic, order, and legitimate authority. High degree of differentiation exists between function and Hierarchy used for reporting.
• Formal rules and procedures and Impersonality and Careers based on merit.

basic tenets of Bureaucratic Management theory
A Bureaucracy should have

• Written rules
• Hierarchy of authority
• Fair evaluation and reward
• System of task relationships

2.5. Contribution of Classical Theory
Classical Management Theories are very important as they provide the basis for all other theories of management. Classical theories enhance the management abilities to predict and control the behavior of the workers. These theories are designed to predict and control behavior in an organization. These theories consider the functions of the task of communication in the organization and ignore the human relational and maintenance functions of communication. These are applied in simple, small and stable organizations while these are not applicable in big, complex and aggressive organizations of today(Pindur, Rogers and Kim, 1995; Cole, 2004; Grey, 2005).
Classical techniques are not free from limitations are likely to dismiss casual relations as characterized by social interchange among workers, the emergence of team leaders aside from people specified by the official group, and so forth. Therefore their concentrate is understandably slim. Failure to consider the informal business; the classical ways seem to check out the life of an employee as the and ending at the plant door. Untested assumptions; classical writers were dependent not on scientific exams but on worth judgments that expressed what they considered to be appropriate life variations, ethical codes, and attitudes toward success.

3.Neoclassical Theory
The Neoclassical approach began with the Hawthorne studies in the 1920s(Wikipedia, 2013). It grew out of the limitations of the classical theory. Under the classical attention was focused on jobs and machines. After some time workers resisted this approach as it did not provide social and psychological satisfaction. Therefore, attention shifted towards the human side of management. George Elton Mayo (1890-1949) is considered to be the founder of the neoclassical theory (Gupta C B, 1992). He was the leader of the team which conducted the famous Hawthorne Experiments at theWestern Electric Company (USA) during 1927-1932 There are mainly three elements of the classical theory of management. They are

Hawthorne Experiment, Human Relation Movement, and Organizational Behavior.

3.1.Main Feature of Neoclassical Theories

1.Individual
2.Work Group
3.Participative management
4.Orientation
5.Motivation
6.Leadership
7.Employee Development

3.2. Hawthorne Experiment
The Hawthorne studies and subsequent experiments lead scientists to the conclusion that the human element is very important in the workplace. The Hawthorne experiments may be classified into four stages: Illumination experiments, Relay assembly test room experiments, Mass interviewing program, Bank wiring observation room study.

3.3. Human Relation Movement
Taking a clue from the Hawthorne Experiments several theorists conducted research in the field of interpersonal and social relations among the members of the organization. these relations are known as human relations. A series of studies by Abraham H.Maslow, Douglas Mc Gregor, Frederick Herzberg, Keth Davis, Rensis Likert, and others leads to what is human relation movement (Singh, 1983). The human relation movement argued that workers respond primarily to the social context of the workplace, including social conditioning, group norms, and interpersonal dynamics.

3.3.1. Maslow – Theory of Human Needs
Maslow’s Theory of Human Needs: People act to satisfy “deprived” needs for which a satisfaction “deficit” exists. His theory of human needs had three assumptions:

• Human needs are never completely satisfied.
• Human behavior is purposeful and is motivated by the need for satisfaction.
• Needs can be classified according to a hierarchical structure of importance, from the lowest to highest.

Maslow broke down the needs hierarchy into five specific areas:
Self-Actualization, Esteem, social, Safety, Physiological

3.3.2. Douglas Mc Gregor Theory X and Theory Y
Theory X stands for the set of traditional beliefs held, while Theory-Y stands for the set of beliefs based on researchers in behavioral science which are concerned with modern social views on the man at work.

• Leaders and managers who hold Theory X assumptions believe that employees are inherently lazy and lack ambition.
• A negative perspective on human behavior.
• Leaders and managers who hold Theory Y assumptions believe that most employees do not dislike work and want to make useful contributions to the organization.
• A positive perspective on human behavior

3.4. Organizational Behavior
Several psychologists and sociologists began the study of group dynamics, ChrisArgyris, Homans Kurt Lewin, R.L. Katz, Kahn and others developed the field of organizational behavior. It involves the study of attitudes, behavior, and performance of individuals and groups in organizational settings. This approach came to be known as a behavioral approach. It is an extended and improved version of human relations movement. It is multidimensional and interdisciplinary the application of knowledge drawn from behavioral sciences (Psychology, sociology, anthropology, etc) to the management problems (Cole G A, 1984). Therefore, it is also called a behavioral science approach.

3.5. Contribution of Neoclassical Theory
Neoclassical theory has made a significant contribution to an understanding of human behavior at work and in an organization. It has generated awareness of the overwhelming role of the n factor in the industry. This approach has given new ideas and techniques for better understanding of human behavior. Contributors to this approach recognize an organization as a social system subject to the sentiments and cultural patterns of the member of the organization, group dynamics, leadership, motivation participation, job environment, etc constitute the core of the neoclassical theory. This approach changed the view that employees are tools and furthered the belief that employees are valuable resources. It also laid the foundation for later development in management theory. The neoclassical approach is not free from limitations.

4.Modern management theory
A Change in one system affects the other subsystems. Modern management theory depends upon the System approach and Contingency approach. Management is influenced by an internal and external environment. Appropriate techniques are determined by the situation and Environmental factors of an organization.

4.1.Main Feature of Modern management Theories

A. Management is responsive to environmental changes.
B. Business organizations are dynamic institutions composed of interrelated divisions and subdivisions.
C. Business firms have multiple objectives. Managers balance economic and noneconomic objectives and maximize the interests of diverse groups of shareholders like customers, suppliers, etc.
D. Management is multidisciplinary in nature.

4.2. Quantitative Theory
The quantitative theory (or the management science theory) has a considerable impact on solving complex business problems. Its
features
are:

1.it establishes relationships amongst quantifiable variables of a decision- making situation and facilitates disciplined thinking.
2. mathematical models help to derive precise and accurate results by analyzing complex statistical data.
3. decisions are based on data and logic rather than intuition and judgment.

4.3. Systems Theory
This theory views organization as a whole that operates in the external environment and has an internal environment consisting of various departments(production, marketing, finance, etc) interrelated to each other in a manner that input-output conversion is done in the most efficient manner.
Features:
It considers the organization as a dynamic and interrelated set of parts.

It considers the impact of both near and distant future on organizational activities.

It integrates goals of different parts of the organization( subsystems or departments) with the organization as a whole.

It enables organizations to frame policies that promote business objectives and social objectives.

4.4. Contingency Theory
The contingency viewpoint developed in the 1950s when a research team headed by Joan Woodward, an industrial sociologist, undertook a study of 100 British firms of different sizes producing different products. It was concluded that difference in performance was not because of principles of classical theories but because of better technology to produce goods. This
developed a theory “ appropriate actions by
managers often depend on( or are contingent on) the situation. Features of Contingency Theory

• Management is situational in nature. The technique of management depends on the complexity of the situation.
• It is the “ if” and “then” approach to management.
• Management principles are not universal in nature as there is no best style of management

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