Roots of modern management

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1 Roots of modern management

2 Roots of modern management Classical approach to management looks at the field from the perspective of how to improve the productivity of operative personnel Frederick Winslow Taylor and his scientific management Henry Ford and his work Henry Gantt and scheduling device graphic bar chart General administrative theorists are concerned with th eoverall organization and how to make it more effective Henri Fayol 14 principles of management Max Weber and his bureaucracy

3 Scientific management Develop a science for each element of an individual s work, which replaces the old rule of thumb method. Scientifically select and then train, teach, and develop the worker. previously workers chose their own work and trained themselves as best they could Heartily cooperate with the workers so as to ensure that all work is done in accordance with the principles of the science that has been developed. Divide work and responsibility almost equally between management and workers. Management takes over all work for which it is better than the workers Previously almost all the work and the greater part of the responsibility were thrown upon the workers

4 14 Principles of Management Fayol s Fourteen Principles of Management 1. Division of Work 8. Centralization 2. Authority 9. Scalar Chain 3. Discipline 10. Order 4. Unity of Command 11. Equity 5. Unity of Direction 12. Stability of Tenure of Personnel 6. Subordination of Individual Interest to the General Interest 13. Initiative 7. Remuneration 14. Espirit de Corps Read more:

5 Weber s Ideal Bureaucracy Weber s Ideal Bureaucracy 1. Division of Labor Jobs are broken down into simple, routine, and welldefined tasks. 2. Authority Hierarchy Offices or positions are organized in a hierarchy, each lower one being controlled and supervised by a higher one. 3. Formal Selection All organizational members are to be selected on the basis of technical qualifications demonstrated by training, education, or formal examination. 4. Formal Rules and Regulations To ensure uniformity and to regulate the actions of employees, managers must depend heavily on formal organizational rules. 5. Impersonality Rules and controls are applied uniformly, avoiding involvement with personalities and personal preferences of employees. 6. Career Orientation Managers are professional officials rather than owners of the units they manage. They work for fixed salaries and pursue their careers within the organization.

6 Human Resources Approach Mary Parker Follet one of the early writers to recognize that organization could be viewed from the perspective of individual and group behavior Elton Mayo and Hawthorne studies begun in 1924 and were undertaken in Western Electric Company s Hawthorne Works in Cicero, USA; Hawthorne studies were initially devised to examine the effect of different illumination levels on worker productivity

7 Hawthorne experiments A series of experiments and qualitative studies covering the design of jobs, changes in the lengths of the workday and workweek, introduction of rest periods and individual versus group wage plans Eg. Wage plans the results indicated that the incentive plan had less effect on worker s output than did group pressure and acceptance and the concomitant security Finally experiments and qualitative studies concluded that behavior and sentiments are closely related Group influences significantly impacts work productivity through social norms and standards; social norms and standards as the determinants of individual work behavior

8 The management environment The foundations of planning Business Environment Scanning Building company s strategy

9 Planning helps in: Planning Defining the organization s objectives or goals Establishing an overall strategy for achieving the goals Developing a comprehensive hierarchy of plans to integrate and coordinate activities Planning is generally concerned with ends and with means what is to be done and how it is to be done

10 Why should managers formally plan? Reduce impact of change Set the standards to facilitate control Provide direction Minimize waste and redundancy

11 Levels of management and goals Top managers Strategic goals Middle level managers Tactical goals First-line managers Operative goals

12 Types of plans Breadth of use Times frame Specificity Frequency of use Strategic Long term Directional Single use Tactical Short term Specific Standing

13 Business strategy Refers to the overall strategy of an organization that is made up of multiple business units, operating in multiple markets Determines how the corporation as a whole supports and enhances the value of the business units within it Answers the question, "How do we structure the overall business, so that all of its parts create more value together than they would individually?"

14 Building a strategy Strategic management process Analyze the organization s resources Identify the organization s current mission, objectives and strategies Reassess the organization s mission and objectives Formulate strategies Implement strategies Evaluate results Analyze the environment

15 Mission and Vision Statements People can be genuinely inspired if their organization has a compelling vision and a clear, worthwhile mission; and these can be powerfully expressed in well-crafted mission and vision statements Statements serve to explain an organization's purpose and direction

16 Mission statements Mission statements define the organization's purpose and primary objectives set in the present tense explain why you exist as a business, both to members of the organization and to people outside it tend to be short, clear and powerful Examples: Walgreens: To be the most trusted, convenient multichannel provider and advisor of innovative pharmacy, health and wellness solutions, and consumer goods and services in communities across America. Nike (athletics) To bring inspiration and innovation to every athlete in the world.

17 Vision Statements Defines organization's purpose, but focuses on its goals and aspirations Designed to be uplifting and inspiring, timeless - even if the organization changes its strategy, the vision will often stay the same Examples: PepsiCo (retail) "Our vision is put into action through programs and a focus on environmental stewardship, activities to benefit society, and a commitment to build shareholder value by making PepsiCo a truly sustainable company." Amnesty International(nonprofit) "Our vision is of a world in which every person regardless of race, religion, ethnicity, sexual orientation, or gender identity enjoys all of the human rights enshrined in the Universal Declaration of Human Rights and other internationally recognized human rights standards." Ikea (retail) "To create a better everyday life for the many people."

Management. tenth edition. Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall 2 1

Management. tenth edition. Copyright 2010 Pearson Education, Inc. Publishing as Prentice Hall 2 1 Management tenth edition Stephen P. Robbins Mary Coulter Chapter 2 Management History 2 1 Learning Outcomes 2.1 Historical Background Of Management. Explain why studying management history is important.