Theory of Management PDF

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What is Management Theory? According to Cambridge dictionary Management Theory is defined as a set of thoughts and techniques designed to assist managers to do their job well: it is also believed that modern administration prefers to inspire or guide their personnel’s through any given tasks [CITATION Cam18 \l 1033 ].

The business dictionary also characterizes Management Theory as “A collection of ideas which set forth general rules on how to manage a business or organization. Management theory addresses how managers and supervisors relate with their organizations in the knowledge of its goals, the implementation of effective means to get the goals accomplished and how to motivate employees to perform to the highest standard”[ CITATION Bus18 \l 1033 ]. Management theories are proposed in order to strengthen organizational structures and also improve service deliveries. It is to this end that management theories were developed. Organizations are allowed to critically evaluate the best style of management approach that best suits their organization and environment for better performance and synergy.

Type of Management Theories There are different type of management theories which includes; 1. Classical management theory 2. Behavioural (Human Relation) management theory 3. Quantitative management theory 4. Quality management theory 5. Systematic management theory 6. Contingency management theory Base on this coursework we will be focusing more on the classical and behavioural (Human Relation) management theories.

What is Classical management theory? Classical management theory also known as scientific management theory was introduced into the world in the early 1900s by Frederick Taylor, with the motive of increasing productivity within the organization and also maximise profit. This theory is concerned more about employee’s knowledge of the tasks given and how it’s been implemented scientifically [ CITATION TER17 \l 1033 ]. We shall be looking into the classical approach to management as proposed by Fredrick Taylor, who is considered to be the father of scientific management, Henri Fayol who is the founder of the administrative principles approach and Max Weber the pioneer of the Bureaucratic organization approach. We shall also evaluate the human relations management theories by Elton Mayo, Abraham Maslow with the hierarchy law of needs and Mary Parker Follett who proposed that organization should be an approach that organizations should be a place where different people come together to work as if they are in a community.

Fredrick Taylor Management Theories Taylor believes that employees should be given specific tools to work with in order for them to be more productive, hence anyone that is not productive after needed tools have been given should be fired. This style of management approach is better in a mechanised operation but do not fit into a human relation approach to management, it does not give room for personal initiatives and teamwork within the organization. Regardless of the level of critics this style of management has attracted, it has proven to be more acceptable in the oil and gas industries across the world, taking Shell petroleum company of Nigeria as an example, they are known to be a company that pay higher incentives to their employees as a means of driving forces for performance and productivity. Any employee that

is found not productive within the organization should be ready to be shown the exit door out of the company payroll system. Taylor proposed four principles of management theories, which includes, 1. The development of a scientific management structure 2. The scientific selection of employee base on specific skills and experience 3. The scientific education and training of employees 4. A conducive working environment where employees can freely relate with managers. Taylor’s principles might seems outdated but they are still in use in by some organization today based on the usefulness of its principles, most especially companies that are into productions and machinery where they have to keep the cost of production as low as possible like Shell, Amazon and McDonalds. The pros and cons of classical management theory Pros. 1. It enhances production 2. It creates room for standard within the organization 3. It improves employees performance when the right person with the right skills and expertise are assigned to particular tasks 4. Wastage and incompetence are eradicated 5. Rapid decision making Cons. 1. No matter how experienced you become on the job, salary structure remains the same, hence, demotivation. 2. Tasks are routine in nature, with no room for creativity 3. The system is not suitable for teamwork 4. Unemployment – since men are being replaced with machines which in turns result to unemployment within the nation. 5. Fatigue – you can only get paid for the numbers of hours you work for.

Max Weber Management Theories. Max Weber a renowned German sociologist is known to be the founder of the bureaucratic system of management, which comprises three major elements; 1. Every organization must have an organizational hierarchical structure in form of power. 2. Rules and regulations must be clearly defined in form of authority within the organization. 3. Rules and regulations must be widely accepted and respected. Max Weber believed that organizations should be managed in a rational way instead of being managed based on emotions and feelings. He proposed 6(six) different approaches in which bureaucracies within the organization could be well managed effectively when it comes to decision making. Max Weber proposed six principles of management theories, which includes, 1. Job specialisation: Task must be assigned based on experience and competence

and

there

must

be

a

clear

balance

between

responsibilities and authority. 2. Levels of Hierarchy within the organization: Every organization must have a hierarchical structure in place in order to manage the chain of commands within the organization. The flow of information must be from top to bottom approach. This is widely practised by most organization today for clarity of roles and responsibilities, most especially government establishments. 3. Professional Employment Selection Rules: Employers should ensure that their mode of employment is based on technical abilities and competence only. Employees are employed solely for the purpose of which they are employed within the organization. 4. Organizational rules and regulations: One of the criteria of a bureaucratic management structure within an organization is to ensure that rules and regulations are developed and applied as at when due with no exception. These rules and regulations must be made available

for the employees in order for them to know what is expected of them at all time. It is called official handbook nowadays. The rules and regulation are expected to be reviewed at an interval periods in order to meet up with current realities within the organization. 5. Impersonality: Rules and regulations are expected to be applied in a uniformed manner with no exception. Even though an interpersonal relationship is allowed within the organization, people in the position of authority should not allow favouritism and partiality to cover their sense of judgements. Official duties should be separated from personal responsibilities and emotions. Every disciplinary and reward decisions should

be

implemented

critically

using

the

official

rules

and

regulations. The pros and cons of bureaucratic management theory There are great benefits of a bureaucratic system within an organization, this includes; 1. There is always room for creativity 2. There is job security if you keep to the rules and regulations 3. There is no room for favouritism or partiality 4. There is power centralization with the assumption of responsibilities as the manager 5. Employee’s development on the job is paramount to the organization through a training structure. Some disadvantages have been identified in the Max Weber theories of management which might not sync with the modern day's styles of management; 1. Too many rules and regulation that can incapacitate employee from maximum performance. 2. Unnecessary delay in decision making as at when due. 3. The difference in salary structure sometimes are not very encouraging 4. Employees might be demotivated due to inabilities to implement personal ideas

5. Rules and regulations might become obsolete in the long run.

Henri Fayol Management Theories. Management of theories can never be discussed without mentioning the contribution of Henri Fayol, where he proposed some elements and principles guiding the management theories [ CITATION Fay49 \l 1033 ]. Fayol defined the elements that affect management which includes; 1. Planning: Fayol explained that managers must have action plans for job execution before embarking on the job itself. 2. Organization: Fayol proposed that organizational structure must be in place in order to achieve organizational goals. 3. Commanding:

Fayol

emphasised

that

managers

are

meant

to

understudy their subordinates in order for them to know their strengths and limits. This is very important as to know who and when to assign tasks. 4. Coordinating: Coordination is a very important aspect of management theory

whereby

managers

are

expected

to

have

strategic

communication skills. 5. Controlling: Fayol assumed that all the previous elements would have been critically followed through by the manager in order to ensure continuity.

Meanwhile, Henri Fayol proposed 14 principles of management [ CITATION Fay49 \l 1033 ], these principles are meant to guide every management on how to properly manage every resource at their disposal. 1. Division of Work – Employee area of specialization is very critical to organizational development. When an employee is versed in his/her task, productivity will definitely improve. 2. Professionalism

and

Responsibilities

-

Responsibility

implies

a

commitment to job execution. Managers must be given the power to assign responsibilities to his/her subordinates.

3. Discipline - It is very important to instil discipline within the organization, there must be regard of higher authority. In a situation where rules and regulations are being flouted, proper disciplinary measures must be implemented to serve as a deterrent to others. 4. Harmonisation of Command – This is a process whereby every subordinate receives instruction through his/her direct manager. In the event that a worker gets orders from more than one predominant, it is probably going to create confusion and tussle of power. 5. Unity of Direction – it is advised that all related tasks are meant to be placed under one manager for proper coordination. 6. Subordination of Individual Interest to Mutual Interest – Organizational interest must always supersede individual interest at all time. Hence, there will be a conflict of interest which might reduce productivity. 7. Compensation - Workers must be adequately compensated as this is one of the major motivational factors that make them remain productive. The significant and systems of compensation payable should be fair and rational. 8. Centralization – The decision-makers should not be seen or perceived to be too far from the subordinates. There should be an appropriate balance between the management, managers and other employees no matter the size of the organization. 9. The line of Authority/Scalar Chain - This is making reference to the chain of managers extending from chief executive officer to the lowest in rank within the organization. Fayol proposed that there should be a realistic chain of command from top to bottom connecting all administrators at all levels. 10.

Order – In an organization where there are law and order, things

are expected to run smoothly without any form of interference. There should be social and material orderliness at all time. 11.

Equity – Every organization are to treat their employees with

respect at all time, and equity must be institutionalised to guarantee a

fair working environment. Managers are expected to be reasonable and unbiased

when

managing

their

subordinates,

giving

equivalent

consideration towards all member of staff. 12.

Stability of Tenure of Personnel – Every employee that has gone

through the employment process and has finally been employed should be given enough time to sync with the new system before any sanction is applied for non-performance. When an employee is aware of his/her job security they tend to perform better and produce more results for the benefit of the organization. 13.

Initiative – Employees should be given free will to use his/her

initiatives

to

produce

a

good

result

for

the

organization.

Implementation of a very good initiative by the employee is a plus for the organization. 14.

Esprit de Corps/Team Spirit - This suggests that managers are to

do everything possible to create a very conducive environment where everyone works as a team. Team spirit builds up unity within the organisation.

The pros and cons of Henri Fayol management theory Pros. 1. It promotes an organizational structure 2. It promotes team spirit 3. It proposes fair compensation plans for the employees Cons. 1. Too much of control over employees 2. This theory is organizationally based and not customer oriented based 3. Fayol principles do not focus more on creativity and innovation from the employees....