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© 2006 by South-Western, a division of Thomson Learning. All rights reserved 1-1 Chapter 1 Management History.

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1 © 2006 by South-Western, a division of Thomson Learning. All rights reserved 1-1 Chapter 1 Management History

2 © 2006 by South-Western, a division of Thomson Learning. All rights reserved 1-2 Definition of Management  The attainment of organizational goals in an effective and efficient manner through: Planning, Organizing, Leading, and Controlling of organizational resources.

3 © 2006 by South-Western, a division of Thomson Learning. All rights reserved 1-3 Ex 1.1 The Process of Management Planning Leading Resources Controlling Organizing Performance Human Financial Raw Materials Technological Information Attain goals Products Services Efficiency Effectiveness Use influence to motivate employees Select goals and ways to attain them Assign responsibility for task accomplishment Monitor activities and make corrections

4 © 2006 by South-Western, a division of Thomson Learning. All rights reserved 1-4 Where did these definitions come from? We didn’t just begin with a complicated definition of management. What are the origins of our thinking about management? “A historical perspective on management provides a context in which to interpret current opportunities and problems” p. 28

5 © 2006 by South-Western, a division of Thomson Learning. All rights reserved 1-5 Management & Organization  Social Forces … values, needs, and standards of behavior.  Political Forces … influence of political and legal institutions on people & organizations.  Economic Forces … forces that affect the availability, production, & distribution of a society’s resources.

6 © 2006 by South-Western, a division of Thomson Learning. All rights reserved 1-6 Ex. 1.7 Management Perspectives Over Time (adapted) Classical Perspective Humanistic Perspective Management Science Perspective Systems Theory Contingency Views Total Quality Management The Learning Organization The Technology-Driven Workplace

7 © 2006 by South-Western, a division of Thomson Learning. All rights reserved 1-7 Classical Perspective Emphasized a rational, scientific approach to the study of management. Sought to make organizations efficient.

8 © 2006 by South-Western, a division of Thomson Learning. All rights reserved 1-8 Classical Perspective Three Subfields 1.Scientific management (Taylor) 2.Bureaucratic Organizations (Weber) 3.Administrative Principles (Fayol)

9 © 2006 by South-Western, a division of Thomson Learning. All rights reserved 1-9 Characteristics of Scientific Management General Approach Developed standard method for performing work. Selected workers with appropriate abilities for job. Trained workers in standard method. Supported worker by planning and eliminating interruptions. Provided wage incentives for increased output. Advantages? Disadvantages?

10 © 2006 by South-Western, a division of Thomson Learning. All rights reserved 1-10 Elements of Bureaucracy 1. Labor is divided with clear definitions of authority and responsibility. 2. Positions are in hierarchy of authority. 3. Personnel are selected and promoted based on qualifications. 4. Acts and decisions are recorded in writing. 5. Management is separate from ownership. 6. Rules and procedures ensure reliable & predictable behavior. Rules are impersonal and uniformly applied.

11 © 2006 by South-Western, a division of Thomson Learning. All rights reserved 1-11 In-Class Exercise List 2 organizations that are successful bureaucracies. 1. Which elements of Bureaucracy are used at the organization you listed? 2. Think of organizations that we label “Bureaucracy” – but don’ t mean it in a positive way. What do those organizations do wrong? Where do they fall short in practicing the elements of Bureaucracy as defined by Weber?

12 © 2006 by South-Western, a division of Thomson Learning. All rights reserved 1-12 Administrative Principles  Contributors to this approach include Henri Fayol & Mark Parker Follet.  Focused on the organization rather than the individual.  Delineated the management functions of planning, organizing, coordinating (leading) and controlling.

13 © 2006 by South-Western, a division of Thomson Learning. All rights reserved 1-13 Fayol’s 14 Points  Division of work  Authority  Discipline  Unity of Command  Unity of Direction  Subordination of individual interest for the common good.  Remuneration  Centralization  Scalar Chain  Order  Equity  Stability of tenure of staff.  Initiative  Esprit de Corps

14 © 2006 by South-Western, a division of Thomson Learning. All rights reserved 1-14 Humanistic Perspective Emphasized understanding human behavior. Dealt with needs & attitudes in the workplace. Truly effective control comes from within the individual worker rather than authoritarian control. Hawthorne Studies brought this perspective to forefront.

15 © 2006 by South-Western, a division of Thomson Learning. All rights reserved 1-15 The Hawthorn Studies  The Hawthorne Studies were conducted from 1927 to 1932 at the Western Electric Hawthorne Works in Chicago, where Harvard Business School professor Elton Mayo examined productivity and work conditions.  The studies grew out of preliminary experiments at the plant from 1924 to 1927 on the effect of light on productivity.  Those experiments showed no clear connection between productivity and the amount of illumination but researchers began to wonder what kind of changes would influence output. Experimenter Effect (Hawthorne Effect) & Social Effect.  Bank Wiring Room Experiment – ability of group to self- manage and influence org. goals.

16 © 2006 by South-Western, a division of Thomson Learning. All rights reserved 1-16 Human Resource Perspective Emphasizes understanding human behavior, needs, and attitudes in the workplace. Combines design of job tasks with theories of motivation. Maintains an interest in worker participation. Considers the daily tasks people perform.

17 © 2006 by South-Western, a division of Thomson Learning. All rights reserved 1-17 Management Science Perspective  Emerged after WWII.  Distinguished for applications of mathematics and statistics to problem solving.  Operations research, Operations Management, Management Information Systems.

18 © 2006 by South-Western, a division of Thomson Learning. All rights reserved 1-18 Systems Theory Inputs Systems Theory TransformationOutputs Feedback from the Environment

19 © 2006 by South-Western, a division of Thomson Learning. All rights reserved 1-19 Systems Theory Principles of Systems theory applied to business organizations consists of 4 characteristics: Open vs. Closed systems. Which one applies to business? Entropy Synergy Subsystems

20 © 2006 by South-Western, a division of Thomson Learning. All rights reserved 1-20 In-Class Exercise McDonald’s as a System. Explain McDonald’s French Fry Process based on Systems Theory: 1. What are the inputs? 2. Describe the transformation process? 3. What are the outputs? 4. What type of feedback might McDonald’s receive from the environment? 5. How might this feedback alter the management decisions about the french fry process in the future? 6. What could happen if McDonald’s management ignores the feedback from the environment and fails to adapt its process?

21 © 2006 by South-Western, a division of Thomson Learning. All rights reserved 1-21 Total Quality Management (TQM) Philosophy of managing the entire organization for continuous improvement. Characterized by: 1. Employee involvement 2. Focus on the customer 3. Benchmarking 4. Continuous Improvement Attributed to W. Edwards Deming. Who?

22 © 2006 by South-Western, a division of Thomson Learning. All rights reserved 1-22 So Why Does Management History Matter?  Do we use Scientific Management today? Where? Why?  Do we use Bureaucracy today? Where? Why?  Do we use the Human Perspective today? Where? Why?  Management science? System theory? TQM? So why does Management History Matter? It’s part of the workplace we will manage TODAY.


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