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Theories of Management Taylor’s principles of scientific management  Emphasized scientific approach to the study of management and sought to make organization efficient operating machines. This strips the individual of their choice and creativity, following only what was needed of them to make the process as efficient and effective as possible to increase productivity. 1) Managers precisely specify every element of an employee’s work which replaces the old rule-of-thumb methods. 2) Managers select and then train, teach and develop employees, unlike in the past when employees chose their own work and trained themselves. 3) Managers are responsible for ensuring that all work is done according to their specifications 4) There is a division of labor based on expertise: managers manage because of their superior knowledge while employees do what they are best at. Why have scientific management? A) Improve labor productivity through scientifically determined changes in management processes B) Develop a science for each element of an employee’s job C) Select workers with appropriate abilities for each job D) Scientifically select and then train, teach, develop each employee E) Heartily cooperate with each other F) Assure an equal division of work and responsibility between managers and non-managers G) Support workers by planning and work (eliminate interruptions) H) Provide wage incentives to workers for increased output. In essence, this theory proposes that the best and most qualified employee should be trained at one repetitive task in order for them to excel at that one task. This will cause less time to complete the task, and thus increases the productivity. Incentives are given. Advantage:

1) Productive because of speed 2) Job security because of incentives (in the past) Disadvantage: 1) People get bored  high turnovers 2) Choice is very important in businesses nowadays 3) Plays down the psychological and social aspects of the organization 4)Views people as interchangeable parts (no human rights). 5) Belief that managerial authority is based on scientific impartiality, but as human beings, we are complex creatures that can never be viewed as fully objective. Application today: 1) Time and motion studies to increase productivity (e.g. McD) 2) Hire the best qualified employees 3) Design incentive system based on output (e.g. investment banks). 4) The separation of “conception” and “execution” (Managers think, and workers do) 5) Standardization of tasks Hawthorne Studies  Emphasized understanding of human behavior, needs and attitudes in the workplace by drawing on psychology, and its impact on motivation, communication, leadership and human resource management. In essence, the human relations movement fostered the belief that effective control comes from within the individual and enlightened treatment of employees. Hawthorne Studies History Conducted from 1927-1932 at the Western Electric Hawthorne works in Chicago, where Harvard business school professor Elton Mayo examined productivity and working conditions

Effects of fatigue and monotony on job productivity and how to control them through variables such as rest breaks, work hours, temperature and humidity Stumbled upon a principle of human motivation that would help to revolutionize the theory and practice of management. Studies highlighted:  bonding with others play a significant part in happiness because sometimes the jobs do not make one happy. They not only need financial incentives, but also need the relationship and respect from others  Despite the isolating effects of standardization and the increasing technical division of labor, work remains as a group activity to most. As a result of their need of recognition, security and belonging, workers will gravitate towards informal groups.  An informal group exercises a strong form of social control over the work habits and attitudes of its members.  Managers should recognize the impart of these informal groups in exerting an influence on productivity. The organization should seek to ensure a good “fit” between informal groups and formal work structures. The Hawthorne studies raises one of the main considerations of OB, which is the quality of the employee’s working life. Importantly, social aspects of work have a major impact on a person’s quality of working life. There is more to motivation than just money, contrary to Taylor’s scientific method of management. However, this is difficult because there are studies that say otherwise. Often informal social networks do not reflect formal organizational structure.

Perception, Attribution and Decision Making Perception is the process of organizing and interpreting sensory data to make sense of your environment. Perceptions of reality form the basis for behavior in all facets of our lives. It is crucial in organizational settings because it informs our decisions and actions. We generally assume that our perceptions allow us to know what is real, but there are psychological and physiological limits to our perception. Our sense do not always reveal to us what is real. And even when they do, there is no guarantee that we will not have trouble seeing what is really there. This becomes a problem when people have to make judgments about themselves and others in an organizational setting. People may intentionally display misleading behavior, which may cause others to perceive them differently. Gestalt psychology suggests that our brain is predisposed to certain types of perception. People often draw conclusions on the basis of limited information, and this is considered an evolutionary adaptation of human beings. Social determinants such as background, education, social class can influence our perception of ourselves and others (Pierre Bourdieu). Perception is importance because one is has the constant expectation to draw conclusions about: 1) why people do things 2) how well people do things 3) how well people will do things in the future. Attribution theory Behavior can be attributed in three ways: 1) Distinctiveness (personal) 2) consensus (situational) 3) consistency (predictability)

Our perceptions aid us in attributing behaviors. But sometimes, errors can occur when we either underestimate or overestimate the impacts of external and internal factors. 1. People tend to attribute their personal success as a result of internal factors 2. People tend to attribute their personal failures as a result of external factors 3. People tend to attribute others’ personal success as a result of external factors 4. People tend to attribute others’ personal failures as a result of internal factors First Impressions When we go for a job interview, it is crucial to make a good first impression due to the automatic attribution that interviewers make of you. 1) The primary effect: the first conclusion drawn about others in a matter of seconds 2) Selective perception: the focus on particular things reflecting that person’s own interest This shows us the importance of social determinants in attribution. It is difficult to shake off a first impression once it has been made. Other sources of bias 1) The halo effect: using one form of behavior to draw conclusions about other behaviors 2) The contrast effect: using a contrasting figure to compare yourself and emphasize a particular character 3) Projection: attributing motivation compared to others 4) Stereotyping: using a simple membership of a group to predict individual behavior Organizational impacts of biases

1) Recruitment and selection: Interviews are poor predictors of performance due to subjective opinions of the interviewer 2) Performance management: overestimate the performance of above average performers and underestimate underperformers. Judging Ourselves The Double Curse: lack of skill to improve on poor performance, as well as the lack of ability to recognize our performance is poor in the first place (Dunning et al., 2003; Yamarino & Atwater, 1997). To avoid inaccurate self-perceptions, feedback from different sources should be implemented. This is known as a 360 degree feedback system or a multi-source feedback system, whereby all parties should be in agreement with the performance of an individual. Self-Other rating agreement

Decision Making This refers to the process of choosing a course of action from among a number of possible courses of action. It is a response to a perceived problem based on data (usually, in the form of perception). Rational decision making involves:

1) stating the problem clearly 2) having all relevant information 3) ability to evaluate all possible outcomes 4) ability to rank outcomes in terms of preference criteria 5) taking as long as needed 6) ability to make an optimal or maximizing decision However, Herbert Simon believes that no individual can ever make a truly rational decision due to limited information processing capabilities. Decisions are instead made on the basis of 1) Satisficing, meaning that they are made on the basis of satisfying minimum standards. 2) Incomplete information 3) Inaccurate or biased hard date, perceptions and values. Importance of Heuristics This refers to the rules of thumb, consisting of: a) formal decision making rules b) experiential decision making rules c) culturally based decision making rules Even if they are the most helpful in making decisions, they are still prone to errors.

Group Dynamics and Teamwork

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Importance of Group Dynamics 1) Increase productivity 2) Improves team members’ quality of working life 3) Improves problem solving capabilities 4) A more “natural” form of organization Groups refer to two or more people acting interdependently to achieve a common objective. The “strength” of the interaction depends on: 1) The nature of the common objective 2) The context in which it takes place 3) The temperament of the group members Groups can be: A) Formal: to achieve an objective set by the organization B) Informal: spontaneous emergence and reflects common interests Groups are important because who individuals associate with has a crucial impact on their sense of identity. They create a social setting where they can exert influence over others. Conduct + Values + Identity + Influence = Discipline Disciplinary effects of groups Disciplinary effects are exercised to ensure they behave in acceptable ways. This will reflect the values of the wider social setting from which the group’s members are drawn. The rise of groupthink (Irving Janis): a mode of thinking that people engage in when they are deeply involved in a cohesive group, when the members’ strivings for unanimity override their individual motivation to realistically appraise alternative courses of action. In essence it makes up:

1) Invulnerability 2) Discounting warnings 3) Unquestioned belief in the group’s morality 4) Stereotyped view of outsiders 5) Pressure to conform 6) Shutting down of deviating ideas 7) Illusion of unanimity 8) “Mindguards”, who shield the group from dissenting opinions Group Development Tuckman’s Five-Stage Model of Group Development 1) Forming: getting to know each other and establishing ground rules 2) Storming: Conflict and resistance to control by leaders 3) Norming: Overcoming conflict to develop close relations 4) Performing: Members work towards completing tasks 5) Adjourning: Group members disband after completion

Maintenance and Task Activities

1) Maintenance: team focuses its efforts on establishing common purpose and cohesiveness 2) Task: team focuses its efforts on getting the job done Teams Effectiveness for Organizations 1) Recognize interdependence 2) Striving towards a common objective 3) Common objectives are aligned with the organization’s 4) Synergy effect (achieve together instead of in isolation)

Problems with Teams Social Loafing, free-riding and shirking: as team size increases, higher chances of this occurring – “Ringelmann” effect (1897). This is when there is poor coordination and people are “not pulling their weight”. a. According to Ingham et al. (1974), there are demotivating effects of social loafing on other members.

b. Alchian and Demsetz (1971) believes that teams encounter “metering problems”, meaning it is difficult to measure an individual’s marginal contribution to productivity. Therefor, there is no incentive to maximize effort because it will not be rewarded. c. Shirking can be considered as exerting effort that is not necessarily advantageous to everyone Much of the maintenance activities of teams are taken up with policing each other’s behavior to ensure that loading, free-riding and shirking do not take place. But this can lead to “tyranny of structurelessness” – descend to bullying, coercion, intimidation and rancor in the absence of formal rules. Individualism vs. Collectivism Different cultures can cope with different demands of teamwork than others. In Western cultures, rewards are expected based on individual effort. This tends to pit colleagues against each other. Because of this, we have to be able to overcome cultural tendency. Leadership Leadership is the influence that individuals exert on others to achieve goals in an organization. It is a fundamental activity for managers, however organizational members can be leaders without occupying a formal managerial role. Leadership in teams Traditional conceptions of leadership are not always compatible, hence Barry suggested a theory known as “distributed leadership” (1991), where there are four types of leadership that must be exercised for a team to be successful: 1) Envisioning: creating a strong vision of the purpose of the team that can easily be translated to into a set of values

2) Organizing: providing structure through a focus on details, deadline and structures 3) Spanning: networking, gathering information and championing the team in the rest of the organization, dealing with outsiders and preventing the team from being isolated. 4) Social: negotiation, conflict resolution, “surfacing” problems, and confronting anti-social behavior. These leadership qualities are shared throughout the team, and are imposed on different times.

Values, Attitudes and Behaviors

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Compliance vs. Conformity

Conformity studies: 1) Asch Conformity Experiment (1963): When tested alone, all participants said the right answer. But when tested in the presence of people who had purposely given the wrong answer, participants agreed with the group 35% of the time. (Internalized tendency to conform) 2) Milgram obedience experiments (1961+): subjects were asked to obey to authority to administer electric shocks on others if they answered questions wrongly. Some even administered shocks up to a lethal dosage. (Internalized tendency to conform to authority, as well as compliance from an external instruction). 3) Stanford “Prison Experiment” (1968): 24 students were picked to be in a mock prison, posing as either “guards” or “prisoners”. Students quickly began acting out their roles explicitly. 4) Blue eyes/Brown eyes experiment (1960+): Students were told that blue eyes were superior to brown eyes. Blue-eyed students began oppressing brown-eyed students. When it was reversed, the brown-eyed students became the oppressing one. Conformity and Values

Social pressure can lead an individual to behave in ways that run counter to their personal values. There may be occasions where personal values may conflict, but other times where our values mean that conformity is less likely. A person’s values will have impact to an organization as there are times where their values might not coincide with the organization’s. Values are expressions of what is “good” or what is “right”. It is based on underlying core beliefs about the world. They are an expression of “right conduct” that we believe can bring about a preferred set of social arrangements. It can be thought in terms of: 1) content: trivial or importance 2) intensity: how strongly it is held. Individuals rely on a system of values – a coherent collection of specific value. Values can be: 1) terminal: the goals that people pursue over the long term, often abstract and related to wider ambitions 2) instrumental: the means of achieving terminal values, usually concrete and related to specific achievements. Attitudes Attitudes are evaluative statements that relate to a specific proposition. Values provide the normative basis for attitudes. They include: a. affective components: emotional evaluation b. cognitive components: basis upon which evaluations are made c. behavioral components: behavior resulting from an attitude They can be either consistent, or non-consistent Attitudes and Behaviors in Job Satisfaction A positive feeling about one’s job based on an evaluation of its characteristics:

1) Multi-faceted attitude: content, pay, promotion 2) Range of values: autonomy, money, social interaction Exit, Loyalty, Voice and Neglect 1) Exit: behavior directed towards leaving the organization 2) Voice: actively and constructively attempting to improve conditions 3) Loyalty: passively but optimistically waiting for things to improve 4) Neglect: allowing conditions to worse

Job satisfaction is straight to measure and can be correlated with a range of outcomes and management practices: 1) positive correlation with productivity 2) negative correlation with turnover 3) “human relations” approaches to work organization 4) Training

5) Input to decisions This illustrates how attitudes influence behavior, and management can influence attitudes. Culture Culture is a group of people that share the same values, attitudes, and behavior. It is a characteristic of a group, not an individual. In OB, culture means a system of shared understanding of the world. They are an expression of shared understanding. Culture is: 1) 2) 3) 4) 5) 6)

Historical A moral force Associated with stability An Exclusive Identity An Inclusive Identity Subject to change (slowly)

Culture exist in many different levels:

National culture is important because it is the silent language and provides the rule that govern the way we interact with one another. It developed the idea of low and high context cultures.

Hofstede conducted a cultural study on IBM workers internationally to find out the different cultural dimensions that affect behavior: 1. Power distance: The extent to which people accept unequal distribution of power 2. Individualist/Collectivist: Whether one prefers to work individually or in a group 3. Quantity/Quality of life: Achievement vs. care of others and quality of life 4. Uncertainty Avoidance: The degree people prefer structured or unstructured situations. 5. Long/Short Termism: Perseverance vs. respect for tradition Impact of Culture National culture: 1) Predispose people to different work behaviors

2) Provide understanding of behavioral patterns across different cultures It is important to know this so that organizations can work effectively, particularly in managing staff. Especially in a globalized world today, learning the impacts of culture on behavior is essential.

Motivation

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Motivation Motivation is the degree of persistent effort directed towards a goal. It is determined by the four components: a. Effort b. Persistence c. Direction d. Goal This idea was formally suggested the idea of motivation, and that human beings are driven by the need to fulfill universal needs. However, before him, there were others that suggested so: 1) Pavlov’s study on classical conditioning (repeatedly administering a stimulus to achieve a standardized response). 2) Skinner’s study on pigeons, which raised the debate of determinism vs. voluntarism. Maslow’s Hierarchy of Needs

This theory is based on the idea how people need to complete 5 levels of basic needs. They need to fully gain one level before they can move on to the next. Hence, the needs are arranged in a hierarchy of importance. Disadvantages: 1. However this model does not apply to all cultures, especially in ...