4.1 management theories 1

Makerere University Business SchoolStrategic Management Course

MANAGEMENT THEORIES

Introduction

Earliest contributorsPracticing managers

Social scientists

More recent theoristsAcademicians

Management consultants

Practicing managers

Reflected on their experiences

To produce rational principles forUniversal application

Efficiency improvement

To structure work & organisations

Did not concentrate on human motivation

Classical / scientific

Early Social Scientists Human behaviour at workStarted with efficiency, looking atPhysical conditions effect on employeesEnded up in human factors at work

Motivation, communication, leadership

CalledHuman relations theorists or Social psychologists

Later social scientistsOrganisations as social systemsContingency theorists

More recent theorists

Strategic perspective

Involve organisation factors:Vision, mission, culture, structure, values, external environment e.t.c

Build on previous theorists

More inclined to contingency theories

CLASSICAL MANAGEMENT THEORIES

Henri Fayol (1841 – 1925) French industrialist & theoristMining engineer @ 19 years, MD @ 47Was practically successful in managementFayol’s definition of management by industrial activities:

Technical, commercial, Financial, Security, Accounting, and managerial

1st 5 activity groups were taken care ofManagerial activities required establishment of principles

Fayol’s Principles of managementDivision of workAuthorityDisciplineUnity of commandIndividual interests sub-ordinationRemunerationCentralisationScalar chainOrderEquityTenure of office stabilityHarmony, and team work

Comments on Fayol’s principles

Emphasis on structural organisation nature – bureaucracy

Fairness, equity e.t.c were not consistent with other main principles

Not suited for rapid change

Fredrick Winslow TaylorLooked at efficiency on shop floorWas a labourer, up to shop superintendent Developed scientific management

BackgroundCame up after industrial revolutionDominant requirement was efficiencyNeed for systematic of workWorkers only put in minimum effort

Scientific management principlesWork study analytical approachSteps

Develop a science for each operation to replace opinion & “rule of thumb”Determine best method & its timing

• Study a job from skilled workers• Eliminate unnecessary actions• Produce best method – standard

Separate planning & controlling from actual “doing”Select & train workers

Principles from Scientific management times

Frank & Lillian GilbrethsGilbreths applied scientific management to brick layingUsed work study method toReduce movements per brick from 18 to 5Current principles from scientific management - Gilbreths

Therbligs – basic elements of on-the-job-motionsProcess charting – process flow charts

Henry GanttWas Taylor’s colleagueDeveloped Gantt charts

Comments on scientific managementBenefits

Increased productivityRational approach – applies measurementIncentive payments – based on results

WeaknessesRigidity – reduced workers’ roleWork fragmentationTaylor was over-optimistic on acceptance by both employees and managementWages were determined scientifically - no social considerations

Bureaucracy – Max Weber (1864 – 1920)

Common meaningRed-tape; excess rules, paper work leading to inefficiency

Management theory meaningAn organisational form with a system of rules and hierarchy of authority

Authority – acceptance of rule by those whom it is to be exercised on.Authority types

TraditionalCharismaticRational – legal

According to Weber, bureaucracy was: The most rational means of controlling human beingsIndispensable for large scale & complex organisations.

Bureaucracy main featuresA continuous organisation of functions bound by rulesSpecified spheres of competenceA hierarchical arrangement of offices (jobs)Appointment based on technical competenceSeparation of officials from ownershipFormulated rules, decisions & actions recorded in writing

Bureaucracy weaknessesRules tend to be more important than efficiency

Rigid behaviour

Prevents search for alternatives because of programmed decision making

Damages relationships with clients and workers

Difficult for change and adaptation