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Management: An Overview

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1 Management: An Overview

2 Organization Organization is a system which operates through human activity. Organizations are very complex social formations, their links can’t be described with only one theory. Organization Theories concerns 3 levels: Macro: cooperation among different organization Mezzo: structures of the organizations, and influencing factors Micro: behavior of the members of the organizations, motivation, conflict etc.

3 What is Management? Definition: Coordinating work activities so that they are completed efficiently and effectively with and through other people Efficiency: getting the most output from the least input Effectiveness: completing activities so that the organization’s goals are attained.

4 Getting work done through others
Management is… Effectiveness Efficiency Getting work done through others Management is getting work done through others. Managers have to be concerned with efficiency and effectiveness in the workplace. Efficiency is getting work done with a minimum of effort, expense, or waste. Effectiveness is accomplishing tasks that help full organizational objectives, such as customer service and satisfaction.

5 Managerial Roles Figurehead Leader Liaison Monitor Disseminator
Spokesperson Entrepreneur Disturbance Handler Resource Allocator Negotiator Interpersonal Informational Decisional Interpersonal Roles–interacting with others figurehead role: managers perform ceremonial duties leader role: managers motivate and encourage workers to accomplish organizational objectives liaison role: managers deal with people outside their units Informational Roles–obtaining and sharing information monitor role: managers scan their environment for information, actively contact others for information disseminator role: managers share the information they have collected with their subordinates and others in the company Decisional Roles–making good decisions entrepreneur role: managers adapt themselves, their subordinates, and their units to incremental change disturbance handler role: managers respond to pressures and problems so severe that they demand immediate attention and action resource allocator role: managers decide who will get what resources and how many resources they get negotiator role: managers negotiate schedules, projects, goals, outcomes, resources, and employee raises

6 Classical Management Functions Updated Management Functions
Planning Organizing Staffing Leading Controlling Making Things Happen Meeting the Competition Organizing People, Projects, and Processes Classical Management Functions Updated Management Functions Classical functions of management are planning, controlling, organizing, and leading. Planning is determining organizational goals and a means for achieving them. Controlling is monitoring progress toward goal achievement and taking corrective action when progress isn’t being made. Organizing is deciding where decisions will be made, who will do what jobs and tasks, and who will work for whom in the company. Leading is inspiring and motivating workers to work hard to achieve organizational goals. Old-style managers think of themselves as the “manager” or the “boss.” New-style managers think of themselves as sponsors, team leaders, or internal consultants. Old-style managers follow the chain of command (reporting to the boss, who reports to the next boss at a higher managerial level, etc.), while new-style managers work with anyone who can help them accomplish their goals. Old-style managers make decisions by themselves. New-style managers ask others to participate in decisions. Old-style managers keep proprietary company information confidential. New-style managers share that information with others. Old-style managers demand long hours. New-style managers demand results. Note that these new functions do not replace the classical functions of management; they build on them. The textbook is organized around the four updated management functions, as shown on this slide, which have evolved out of the classical functions.

7 Levels of Management Top Level Management Middle Level Management
The jobs and responsibilities of the four kinds of managers are shown in Exhibit 1.2. First-Line Management

8 Top Managers Responsible for… Creating a context for change
Developing attitudes of commitment and ownership in employees Creating a positive organizational culture through language and action Monitoring their business environments Top managers hold positions like chief executive officer (CEO) or chief operating officer (COO) and are responsible for the overall direction of the organization.

9 Middle Managers Responsible for…
Setting objectives consistent with top management goals, planning strategies Coordinating and linking groups, departments, and divisions Monitoring and managing the performance of subunits and managers who report to them Implementing the changes or strategies generated by top managers Middle managers hold positions like plant manager, regional manager, or divisional manager. Note how middle managers’ responsibilities are influenced by those of top managers. Note also how their responsibilities are more narrowly focused than of top managers.

10 First-Line Managers Responsible for…
Managing the performance of entry-level employees Teaching entry-level employees how to do their jobs Making schedules and operating plans based on middle management’s intermediate-range plans First-line managers hold positions like office manager, shift supervisor, or department manager. First-line managers are the only managers who don’t supervise other managers. They are closest to employees and have daily contact with employees.

11 What Companies Look for in Managers
Technical Skills Human Skill Conceptual Skill Design Skill Technical skills are most important for lower level managers, because these managers supervise the workers who produce products or serve customers. Team leaders and first-line managers need technical knowledge and skills to train new employees and help employees solve problems. Technical skills become less important as managers rise through the managerial ranks, but they are still important. Human skills are equally important at all levels of management, from first-line supervisors to CEOs. However, because lower level managers spend much of their time solving technical problems, upper level managers may actually spend more time dealing directly with people. Conceptual skill is the ability to see the organization as a whole, how the different parts of the company affect each other, and how the company fits into or is affected by its external environment. Conceptual skill increases in importance as managers rise through the management hierarchy. Managers typically have a stronger motivation to manage than their subordinates, and managers at higher levels usually have stronger motivation to manage than managers at lower levels. Furthermore, managers with stronger motivation to manage are promoted faster, are rated by their employees as better managers, and earn more money than managers with a weak motivation to manage.

12 Core skills and their use in the different levels
Managerial levels Middle Lower Top Conceptual skills Human skills Technical skills

13 Management Theory Pre-Classical Classical Approaches
Frederick Taylor: Scientific Management (1886) Frank and Lillian Gilbreth: Time/motion studies (later 1800s) Henri Fayol: 14 Principles of Management (1880s-1890s) Max Weber : Bureaucracy (1920s) Behavioral Approaches The Hawthorne Experiment (1927) MacGregor’s Theory X and Theory Y (1960) Quantitative Approaches Contemporary Approaches Ouchi’s Theory Z (1981) Contingency Management

14 Classical Approaches Frederick Taylor: Scientific Management (1886)
Frank and Lillian Gilbreth: Time and motion studies (later 1800s) Henri Fayol: Fourteen Principles of Management (1880s-1890s) Max Weber : Bureaucracy (1920s)

15 Frederick W. Taylor Developed Scientific Management
Laid foundation for the study of management Key ideas: Management as a separate field of study Explicit guidelines for scientific study of management functions Time studies for setting standards Functional specialization of managers’ duties Piece-rate Incentive systems

16 Taylor’s Principles of Management
The “one best way.” Management using scientific observation Scientific selection of personnel Put right worker in right job, find limitations, train Financial incentives Putting right worker in right job not enough A system of financial incentives is also needed Functional foremanship Division of labor between manager and workers Manager plans, prepares, inspects Worker does the actual work “Functional foremen” , specialized experts, responsible for specific aspects of the job

17 Frank & Lillian Gilbreth
Time and motion efficiency experts Developed therbligs, breakdown of manual skills into 16 actions Frank was a lazy bricklayer looking for an easier way and Lillian was a psychologist. Endorsed piece-work and suggested a higher rate per unit if his directions were followed. Disagreed with Taylor’s idea that management should choose which workers took which jobs.

18 Henri Fayol First came up with the five basic functions of management—Planning, Organizing, Staffing, Directing, Communicating, and Controlling First wrote that management is a set of principles which can be learned. Developed Fourteen Principles of Management


20 1. Specialization of labor
1. Specialization of labor. Specializing encourages continuous improvement in skills and the development of improvements in methods. 2. Authority. The right to give orders and the power to exact obedience. 3. Discipline. No slacking, bending of rules. 4. Unity of command. Each employee has one and only one boss. 5. Unity of direction. A single mind generates a single plan and all play their part in that plan. 6. Subordination of Individual Interests. When at work, only work things should be pursued or thought about. 7. Remuneration. Employees receive fair payment for services, not what the company can get away with.

21 8. Centralization. Consolidation of management functions
8. Centralization. Consolidation of management functions. Decisions are made from the top. 9. Scalar Chain (line of authority). Formal chain of command running from top to bottom of the organization, like military 10. Order. All materials and personnel have a prescribed place, and they must remain there. 11. Equity. Equality of treatment (but not necessarily identical treatment) 12. Personnel Tenure. Limited turnover of personnel. Lifetime employment for good workers. 13. Initiative. Thinking out a plan and do what it takes to make it happen. 14. Esprit de corps. Harmony, cohesion among personnel.

22 Max Weber Coined “bureaucracy”: the perfect office
Well defined chain of command Clear division of work (job descriptions) Procedures for any situation Impersonality Employment and promotion based on technical competence.

23 Behavioral Approaches
The Hawthorne Experiment (1927) Chester Barnard (1930s – 1960s) Herbert Simon (1947) MacGregor’s Theory X and Theory Y (1960)

24 The Hawthorne Experiment
Research conducted at the Hawthorne plant of the Western Electric Company near Chicago, Initial study: effects of lighting on worker performance But the “Hawthorne Effect” was instead identified The workers values, desires, and needs may be more important than physical conditions. Workers want to have input. Workers want to be respected.

25 Theories X and Y Conducted in 1960s by Douglas McGregor
Theory X: classical theory Most people dislike work and responsibility, they are motivated only by money and do not care about the job. Close supervision is required and people must be carefully controlled and coerced into working Average person prefers direction

26 Theories X and Y Theory Y: Modern Management Theory
People often enjoy their work and will exercise self-control at work. People are motivated by wanting to do a good job and will do well if the opportunity is presented People have capacity for imagination, ingenuity, and creativity People enjoy expending physical and mental effort in work as much as play and rest

27 Contemporary Approaches
Ouchi’s Theory Z (1981) Contingency Management

28 Ouchi’s Theory Z Theory Z Value of culture in an industrial society
Intimate and cooperative work relationships Alienated in work environment in which family ties, traditions, and social institutions are minimized Workers have strong sense of moral obligation, discipline and order

29 Contingency Management
Managing in Different and Changing Situations Require managers to use different approaches and techniques Contingency perspective - different ways of managing are required in different organizations and different circumstances stresses that there are no simplistic or universal rules contingency variable © Prentice Hall, 2002

30 Brief Behavioral Quantitative Approach System Theory
Mary Parker Follet : “Power Sharing” Chris Argyris: Model I & Model II Organisations Quantitative Approach Management Science Operation Management MIS System Theory

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