Cmp Module i

7/30/2019 Cmp Module i

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Classical management theories

By:Er. Azhar Shaikh


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Main idea

of classical organizational theory

There is one best way to perform a task


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Classical organizational theory

espouses two perspectives:

Scientific managementfocusing on the management of

work and workers

Administrative management - addressing issues

concerning how overall organization should be structured


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Administrative Management Theory

Scientific Management Theory

Behavioral Management Theory

Management Science Theory

Organizational Environment Theory


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Frederick Taylor

Taylor is born in Pennsylvania on March 20,1856

After studying in Europe, he plans to go to

Harvard, but does not pass the entrance exams

Instead Taylor works as a pattern maker at a

pump manufacturing company in Philadelphia

Later, he studies mechanical engineering atStevens, finishing in just three years.


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Midvale Steel Company

Taylor begins working for the Midvale steel Company in1878.

While there he succeeds in doubling the work of his men,

is soon promoted to foreman As foreman, he begins studying productivity as a means

of measuring of manufacturing.

Later he becomes the chief engineer at Midvale.


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Ingenuity and Accomplishments

Creates systems to gain maximum efficiency fromworkers and machines in the factory.

Focuses on time and motion studies to learn how to

complete a task in the least amount of time. Becomes consulting engineer for many other companies

PublishesThe Principles of Scientific Management


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Key Points of

Scientific Management

1. Scientific Job Analysisobservation, data gathering, andcareful measurement determine the one best way toperform each job

2. Selection of Personnelscientifically select and then

train, teach, and develop workers3. Management Cooperationmanagers should cooperatewith workers to ensure that all work is done in accordancewith the principles of the science that developed the plan

4. Functional Supervisingmanagers assume planning,

organizing, and decision-making activities, and workersperform jobs


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Demise of Scientific Management

In hands of business

Scientific Management = tool to exploit labor

By 1915growing labor against Taylorism

Union members/100 workers: 1880=1.8; 1900=7.5;1914=10.5

Congress investigates and US Commission on

Industrial Relations issues Hoxie Report (1915)

declaring Scientific Management as exploitive of labor.

It will influence Management thoughtbut Scientific

Management is deaduntil rediscovered in Japan

the 1970/s wave of Quality Management


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Management of the Organization While in the US Management focuses on individual at

work

In Europe early theory (that in 1930s will become part of

American management) focuses on the organization

Administrative Management Theory.

Max Weber (German)focuses on bureaucracy as a

formal organization to gain efficiency.

Henri Fayol (French)focuses on 14 principles of

Administration as One Right Way


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Henri Fayol

Engineer and French industrialist

In France works as a managing director in coal-mining

organization

Recognizes to the management principles rather thanpersonal traits

While others shared this belief, Fayol was the first to

identify management as a continuous process of

evaluation.


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Fayols 5 Management Functions

Fundamental roles performed by all managers:Planning

Organizing

Commanding

Coordinating

Controlling

Additionally Fayol recognizes fourteen principles that should guidethe management of organizations.


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Fayols 14 Principles:

1. Division of Workimproves efficiency through a reduction ofwaste, increased output, and simplification of job training

2. Authority and Responsibilityauthority: the right to give orders

and the power to extract obedienceresponsibility: the

obligation to carry out assigned duties

3. Disciplinerespect for the rules that govern the organization


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4. Unity of Commandan employee should receive orders from onesuperior only

5. Unity of Directiongrouping of similar activities that are directed

to a single goal under one manager

6. Subordination of Individual Interests to the General Interestinterests of individuals and groups should not take precedence

over the interests of the organization as a whole.

7. Remuneration of Personnelpayment should be fair and

satisfactory for employees and the organization8. Centralizationmanagers retain final responsibilitysubordinates

maintain enough responsibility to accomplish their tasks


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9. Scalar Chain (Line of Authority)the chain of command from theultimate authority to the lowest

10. Orderpeople and supplies should be in the right place at theright time

11. Equitymanagers should treat employees fairly and equally

12. Stability of Tenure of Personnelmanagerial practices thatencourage long-term commitment from employees create a stableworkforce and therefore a successful organization

13. Initiativeemployees should be encouraged to develop and carryout improvement plans

14. Esprit de Corpsmanagers should foster and maintainteamwork, team spirit, and a sense of unity among employees


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16

Time and Motion Study


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Frank and Lillian Gilbreth

Frank Gilbreth engineer; pioneered Scientific Methods inbricklaying.

Member of Taylor Society (SAM)

Lillian Gilbreth engineer/industrial psychologist (PhD);stress and fatigue

Together 12 Children Cheaper by the Dozen

Time and motion studies Breaking up each job action into its components

(Therblig). Finding better ways to perform the action. Reorganizing each job action to be more efficient.


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Time and Motion Study:

Defined

A method created to determine the correct

time it takes to complete a certain task A method to establish the one best way to

perform a task


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Purposes

To end goofing off and to establish what

constituted a fair days work To make sure that the job being evaluated does

not include any unnecessary motion by the

worker


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History

Frederick W. Taylor and his followersdeveloped and refined the Time Study

Frank B. Gilbreth and his wife Lilliandeveloped and refined the Motion Study

Historically the two studies are discussedindividually, today they generally are

discussed as one


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Time and Motion Study:In your

Organization

Historically: T&M Studies

were used in the

manufacturing industry to

evolve pay scales with the

thought that money was

the only motivation for

work


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Objective

The objective of the Time and Motion Study is to determine a

normal or average time for a job, by using observers torecord exactly how much time is being devoted to each task.

Example for a an effective time & motion study utilization

(Unknowingly)
http://media/AZZ%20SANDISK/CMP%20Management%20Theories/Fastest%20ROTI%20(Episode%202).mp4http://media/AZZ%20SANDISK/CMP%20Management%20Theories/Fastest%20ROTI%20(Episode%202).mp4http://media/AZZ%20SANDISK/CMP%20Management%20Theories/Fastest%20ROTI%20(Episode%202).mp4http://media/AZZ%20SANDISK/CMP%20Management%20Theories/Fastest%20ROTI%20(Episode%202).mp4


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Webers Principles of Bureaucracy1. Formal authority comes from ones organizational

position (Bureaucracy = rational power)

2. Positions should be held based on merit, not social

standing or personal contacts. (Break with traditionalpower)

Each positions responsibilities and relationship to other positionsshould be clearly specified. (Roles)

Authority in a bureaucracy is hierarchical power.

Formalization = well-defined system of rules (SoPs), operating procedures, and norms = control via rational

power.


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The Hawthorne Studies: New

DirectionThe Hawthorne Experiments were a series of studies intoworker productivity performed at the Cicero plant beginning in1924 and ceasing in 1932, initially conducted by the NationalResearch Council and later by Western Electric and HarvardUniversity

Illumination Studies, 1924 -1927: Does Use of Electric LightsIncrease Productivity?

Hypothesis: Increased illumination is correlated with higherproductivity.

Finding: No relationship

Hawthorne effect or "halo effect Researcher

affects outcome (bias)


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2nd

Hawthorne ExperimentRelay Assembly Test Room Experiments, 1927-1929 Harvard researchteam set up experiment with 5 females from Relay Assembly area totest impact of incentives and work conditions on worker fatigue

There is no conclusive evidencethat these affected fatigue or

productivity.

Productivity and worker

satisfaction increase when

conditions are improved

and made worse.


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3rd

Hawthorne ExperimentMica-Splitting Test group, 1928 1930Relationship between work conditions andproductivity, by maintaining a piece-rate incentive

system and varying work conditions

Productivity increased by about 15% andresearchers concluded that productivity was

affected by non-pay considerationsConclusion: social dynamics were the basis

of worker performance.


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Hawthorne InterviewsPlant-wide Interview program, 1928-1931

1. Western Electric implemented a plant-wide

survey of employees to record their concerns andgrievances. From 1928 to 1930, 21,000employees were interviewed.

2. Data supported the research conclusion that

work improved when supervisors began to payattention to employees, that work takes place in asocial context in which work and non-workconsiderations are important, norms and groups

matter to workers.


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Hawthorne : Final ExperimentBank Wiring Observation group, 1931-1932The final test studying 14 male workers in the BankWiring factory to study the dynamics of the group when

incentive pay was introduced.There was no effect. Why?

Work group established a work norm a shared

expectation about how much work should be

performed in a day and stuck to it, regardless of

pay.

The conclusion: informal groups operate inthe work environment to manage behavior.


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Hawthorne Experiments -

ImportanceChanged perspective in management from Taylors engineeringapproach to a social sciences approach, leading to "HumanRelations" approach and, later, "Organization Behavior"approach:

Engineering approach subordinated to social sciencesManagers = leaders, motivators, communicators

At one time major contributors to Management theory worked onHawthorne experiments.

Elton Mayo - Human Relations

approach (to 1950s). Mayos viewslead to the construction of manager

as a leader.


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McGregor: Theory X, Theory YThere are two ways of perceiving people at work:Theory Y:Work is as natural as play or rest- not disliked..

Workers will exercise self-direction and

self-controlMeeting goals is satisfying and motivating. .

Workers seek responsibility. ...

Workers will be creative and are willing to do more.

Theory X:The average human inherently dislikes to work

So, people must be coerced, controlled, directed.Workers prefer this but want security.

The average worker is only partially utilized.


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Management Science ApproachPost World War II British use of mathematics,Operations Research, in military operations findapplications in US post war industrial

development.Quantitative management use ofmathematic models, linear programming,simulation systems and chaos theory to solvemanagement problems.

Operations management techniques used toanalyze all aspects of the production system.


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Management Science Approach-

Cont.Total Quality Management (TQM) analyzinginput, conversion, and output to increase productquality.

Management Information Systems (MIS) provides information vital for effective decisionmaking


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Systems Approach


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Mary Parker Follett

The Humanizing of Management

and focus on collaboration.Taylor ignored the human side of the work,Follett argued:Organizations are an interdependence of people.

People have own interests but also share commongoals which should be the basis of conflict resolution.

Use of power/coercion creates conflict. Peoplewill defer to the facts of a situation for authority.


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Contingency ApproachThere is no one best way.Organizing (and other) decisions that match the demands of the environmentprovide adaptation.


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So-What does a manager do?It depends on where they are in the organization:


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What do Top Managers Do?Myth FactWork is reflective andinvolve systematic planning.

Work is action oriented, stressedimmediate response, and work wasVaried.

No Regular Duties Duties are ritual and ceremonial,negotiations, and processing softinformation

Relies on formal MIS for

decision-making

Favor verbal, immediate information even

informal, soft data which is processed intocoherent picture

Management is aScience

Source: Mintzberg: The Managers Job

Relies on judgment and intuition toMake decisions


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Business Process

Reengineering


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Outsourcing


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Outsourcing

Outsourcing is the act ofone company contractingwith another company toprovide services thatmight otherwise beperformed by in-houseemployees

K l d M t


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Knowledge Management


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Cmp Module i