BUS 5113 UNIT 1 Four Organizational Theoretical Contributions PDF

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FOUR ORGANIZATIONAL THEORETICAL CONTRIBUTIONSFour Organizational Theoretical Contributions Business organizational studies have taken on a more rigorous scientific focus that has shaped modern organizations. Lægaard identifies four major task performance and formalized structural theoretical contrib...

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FOUR ORGANIZATIONAL THEORETICAL CONTRIBUTIONS Four Organizational Theoretical Contributions Business organizational studies have taken on a more rigorous scientific focus that has shaped modern organizations. Lægaard identifies four major task performance and formalized structural theoretical contribution schools central to understanding modern organizations: F. W. Taylor’s school of scientific management, H. Fayol’s school of administrative theory, M. Weber’s theory of bureaucracy, and H. Simon’s 1947 book of Administrative Behavior (2006). Because the common thread of these schools is task performance and structure, a rational system of transparency, enhanced output via plasticity, and flexibility that allow organizational restructuring is ensured (Haggarty-Weir, 2018, para. 2-3). Taylor’s School of Scientific Management Frederick Winslow Taylor wrote “The Principals of Scientific Management” in 1909 proposing optimization and simplifying job to thus increase productivity (Frederick Taylor and Scientific Management, n.d., para. 3). The scientific management theory is also known as “Taylorism” believes workers are motivated by financial incentives where highly productive workers are paid more than less productive ones. Taylorism encourages engagement between workers and managers which was not the case in factory organizations in the 17- and 1800s (Frederick Taylor and Scientific Management, n.d., para. 3). Taylorism introduced selection and training procedures that are systematic and established a way to effectively study workplace efficiency and a way to design a systematic organization. A downside to Taylorism today is because the theory denotes “one right way” to accomplish many things, it conflicts with newer management approaches that promote individual responsibility and create decision-making in all levels of organizations. And even though management is encouraged to be more engaged with employees, Taylorism breaks down individual jobs into systematic, specific, steps for each

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2 person, separating manual from mental work, which discourages teamwork, and collaboration that is sought in modern organizations.

Fayol’s School of Administrative Theory Henri Fayol’s school of administrative theory is based on departmentalization where activities for the common goal of the organization are classified into groups or departments with the belief that tasks are accomplished with greater efficiency and expertise (Administrative Theory, n.d., para. 1). Fayol believed that emphasis should focus on organizational and human management and behavioral dynamics. Unlike the scientific theory that emphasizes minimizing task time and worker efficiency, the administrative theory’s primary focus is on management structure and how individuals are grouped into efficient departments. Fayol’s 14 Principles of Management are: 1. Division or work – work divided based on specializations and expertise 2. Authority and Responsibility – Authority to delegate and responsibility to perform 3. Discipline – referring to obedience and behavior of employees towards each other 4. Unity of Command – An individual receives commands from only one person 5. Unity of Direction – Groups of different tasks rolling up to organizations common goals 6. Subordination of Individual to General Interest – No individual interest over the common interest 7. Remuneration of Personnel – wages are fair to both employees and employers 8. Centralization – reducing the importance of subordinates 9. Scalar Chain – proper organization hierarchy

3 10. Order – everything is the right place including materials and the right person for the right job 11. Equity – everyone treated equally with justice and fairness 12. Stability of Tenure – employee retention 13. Initiative – subordinate encouragement to take action 14. Esprit de Corps – “Unity is strength” (Henri Fayol’s 14 Principles of Management, n.d. p. 1) Most large, modern, organizations are organized administrative-style with departments like engineering, human resources, information technology, etc. with groups producing output for the common goal of the company.

Weber’s Theory of Bureaucracy Max Weber’s bureaucratic theory is the basis for the systematic formation of an organization that is designed efficiently and economically. He defines three types of power in an organization: traditional, charismatic, and legal. The three elements that support a bureaucratic management system are activities are regarded as official duties, management imposes rules, and established methods make rules easily respected (Mulder, 2017, para. 14). The six bureaucratic management principles are: 1. Task Specialization – divided into categories based on competencies 2. Hierarchical of Authority – Management divided into hierarchical layers 3. Formal Selection – Employees are selected based on competencies and technical skills 4. Rules and Requirements – Formal rules and requirements ensure uniformity

4 5. Impersonal – Clear requirements and regulations create distant, impersonal relationships between workers 6. Career Orientation – Selecting employees based on expertise deploys the right people in the right positions (Mulder, 2017).

Bureaucracy is common in organizations where legislation “plays an important role in delivering a consistent output” (Mulder, 2017, para. 10) and makes it easier for management to make adjustments and maintain control. Disadvantages are large amounts of red tape, paperwork, and slow communication due to all the hierarchical layers. It is difficult for innovation with employees who are restricted by regulatory and policy compliance.

Herbert A. Simon’s Book of Administrative Behavior (1947) Simon’s theories are based on a rational model of decision-making that is classical and ideal. He asserts that decision-making is the heart of the administration and drives the organization drawing heavily on cognitive psychology and dissecting bureaucratic theories – although all the managerial hierarchy in a car manufacturing plant, the assembly at the bottom are making decisions as he assembles the car. Managers in high positions higher value component “what” decisions while those in lower positions make higher factual component “how” decisions (Simon, 1947, p. 86). “Each goal in the means-end hierarchy is an end to things below it and a mean to those above it” (Administrative behavior, theory of, n.d. p. 1). Simon highlights four legacies. 1. scholarship on incrementalism in policymaking 2. scholarship on agenda-setting

5 3. scholarship on choice architecture 4. and the scholarship on expertise and learning organizations

Simon’s book of Administrative Behavior was first published in 1947; the 2nd edition was released in 1957, 3rd in 1976, and the 4th in 1997. Emerging technology combined with increasing public demand for more efficient and effective government, suggest ideas introduced by Simon will influence practice in public management and policy design for years to come. Conclusion Business organizational studies have taken on a direr scientific focus that has and continues to evolve modern organizations. Four schools of theory that are task and formalized structurally is the school of scientific management, administrative theory, the theory of bureaucracy, and the book of Administrative Behavior. These schools have affected how organizations are structured and managed today and set the foundation for understanding human behavior, decision-making, and productivity in the workplace.

6 References Administrative behavior, theory of (n.d.). Retrieved from ht t ps : / / i s . t he o r i z e i t . o r g / wi ki / Ad mi n i s t r a t i v e _ b e h a v i o r , _ t he o r y _ of Administrative Theory (n.d.). Retrieved from https://businessjargons.com/administrativetheory.html Frederick Taylor and Scientific Management (n.d.). Retrieved by https://www.mindtools.com/pages/article/newTMM_Taylor.htm Haggarty-Weir, Christopher (2018). Organizational Theory: Then and Now. Retrieved from https://mostlyscience.com/2018/04/organizational-theory-then-and-now/ Henri Fayol’s 14 Principles of Management (n.d.). Retrieved from https://businessjargons.com/henry-fayols-14-principles-management.html Laegaard, J., & Bendslev, M. (2006). Organizational theory. Retrieved from http://bookboon.com/en/organizational-theory-ebook Mulder, P. (2017). Bureaucratic Theory by Max Weber. Retrieved from ToolsHero: https://www.toolshero.com/management/bureaucratic-theory-weber/ Simon, Herbert A. (1947). Retrieved from h t t p s : / / www. a ma z o n . c om/ Ad mi n i s t r a t i v e Be h a v i o r 4t h He r b e r t Si mo n / dp / 0 6 8 4 8 3 58 2 7...