1. PowerPoint Presentation by Charlie Cook
Copyright © 2005 Prentice Hall, Inc. All rights reserved.

2. Historical Background of Management
Ancient Management
Organized jobs directed by people responsible for planning, organizing, leading, and controlling activities have existed for thousands of years.
Egypt (Pyramids) and China (The Great Wall)
Venetians (floating warship assembly lines)
Adam Smith
Published “The Wealth of Nations” in 1776
Advocated the division of labor (job specialization) to increase the productivity of workers.
Industrial Revolution
Substituted machine power for human labor
Created large organizations in need of management

3. Major Approaches to Management
Scientific Management
General Administrative Theory
Quantitative Management
Organizational Behavior
Systems Approach
Contingency Approach

4. Development of Major Management Theories
Exhibit 2.1

5. Scientific Management
Frederick Winslow Taylor − The “father” of scientific management.
Published Principles of Scientific Management (1911)
The use of scientific methods to define the “one best way” for a job to be done.
Putting the right person on the job with the correct tools and equipment.
Having the worker follow instructions exactly or use a standardized method of doing the job.
Motivating the worker with an economic incentive (bonus) of a higher wage.

6. Scientific Management (cont’d)
Frank and Lillian Gilbreth
Focused on increasing worker productivity through the reduction of wasted hand and body motions.
Experimented with tools and equipment to optimize (get the most out of) work performance.
Developed the microchronometer to time worker motions and optimize performance.
Today’s use of scientific management:
Analyze the work tasks to be performed
Use time-and-motion study to eliminate wasted motions
Hire the best qualified workers for a job
Design incentive (bonus, reward) systems based on output (production).

7. General Administrative Theorists
Henri Fayol
Described management as a set of functions that included planning, organizing, commanding, coordinating, and controlling.
Believed that the practice of management was distinct from other organizational functions.
Developed fourteen principles of management that applied to all organizational situations.
Max Weber
Developed a theory of authority based on an ideal type of organization: bureaucracy
Emphasizing rationality, predictability, impersonality, technical competence, and authoritarianism

8. General Administrative Theorists (Vocabulary)
Rationality: Having good sense, sound judgment
Predictability: capable of being known in advance
Impersonality: Without preference to individual persons
Competence: Good physical and intellectual ability
Authoritarianism: Centrally managed by a single individual or small group

9. Fayol’s 14 Principles of Management
Division of work.
Authority.
Discipline.
Unity of command.
Unity of direction.
Subordination of individual interest to the interests of the organization.
Remuneration.
Centralization.
Scalar chain.
Order.
Equity.
Stability of tenure of personnel.
Initiative.
Esprit de corps.
Exhibit 2.3

10. Weber’s Ideal Bureaucracy
Exhibit 2.4

11. General Administrative Theories
Today’s use of general administrative theories of management:
Many contemporary (today’s) managers feel that “bureaucracy” takes away employees’ creativity and the organization’s ability to respond quickly to a dynamic (changing) environment. Yet today some bureaucratic mechanisms (processes) are necessary to ensure that resources are used efficiently and effectively.

12. Quantitative Approach to Management
The Quantitative Approach
Also called operations research or management science
Evolved from mathematical and statistical methods developed to solve WWII military logistics and quality control problems
Focuses on improving managerial decisions by applying:
Statistics (data), optimization models (improvement theories), information models (use of recorded information), and computer simulations (the technique of using a computer program to create a virtual representation of what can possibly happen).

13. Quantitative Approach to Management
Today’s use of the quantitative approach to management:
The availability of software programs has made the use of quantitative techniques easier for managers. Today, when managers make budgeting, scheduling, quality control, and similar decisions, they rely on quantitative techniques.

14. Understanding Organizational Behavior
Organizational Behavior (OB)
The study of the actions of people at work.
The early advocates of OB believed that people were the most important asset of an organization
Their ideas provided the basis for employee selection procedures, motivation programs, work teams and working environment management techniques.
Behavior: Way of relating to other humans, conduct.
Research conclusion of the Hawthorne Studies
Social norms, group standards and attitudes more strongly influence individual output and work behavior than do monetary incentives.

15. Today’s Use of Organizational Behavior
The behavioral approach is widely used in today’s organizations as can be seen in:
--The way managers design motivating jobs
--The way they work with employee teams
--The way they use open communication.
Early OB and the Hawthorne studies provided the basis for our current (today’s) theories of motivation, leadership, group development and other behavioral topics.

16. The Systems Approach System Defined Basic Types of Systems
A set of interrelated (all connected) and interdependent (depend on each other) parts of an organization that work together as a whole to achieve goals.
Basic Types of Systems
Closed systems
Are not influenced by and do not interact with their environment. Inputs and outputs are internal.
Open systems
Dynamically interact with their environment. They collect inputs (resources) from the environment and transform them into outputs that are distributed into the environment.

17. The Organization as an Open System
Exhibit 2.6

18. Implications (meanings/ideas) of the Systems Approach
How the systems approach is appropriate for understanding management:
Coordination of the organization’s parts is essential for proper functioning of the entire organization.
Decisions and actions taken in one area of the organization will have an effect in other areas of the organization.
Organizations are not self-contained and, therefore, must adapt to changes in their external environment.
Self-contained: Complete and independent in and of itself. E.g. The university is like a self-contained city with shops and conveniences.

19. The Contingency Approach
Sometimes called the situational approach.
The contingency approach differs from the early theories of management insofar as:
Organizations are different from one another, there is no single universally applicable set of management principles (rules) by which to manage all organizations.
Organizations face different situations (or contingencies = changing events/conditions), and require different ways of managing depending on the present conditions.

20. Current Trends and Issues
We need to look at these current trends and issues because they are changing the way managers do their jobs.
-- Globalization
-- Ethics
-- Workforce Diversity
-- Entrepreneurship
-- E-business
-- Knowledge Management
-- Learning Organizations
-- Quality Management

21. Current Trends and Issues (cont’d)
Globalization
Management in international organizations
Political and cultural challenges of operating in a global market
Ethics
Increased emphasis on ethics education (the study of moral values and rules) in college curriculums
Increased creation and use of codes of ethics by businesses (sets of rules and principles directing the conduct of employees in deciding what is right and wrong when faced with difficult choices)

22. Current Trends and Issues (cont’d)
Workforce Diversity
Increasing heterogeneity in the workforce
In terms of gender, race, ethnicity and other forms of diversity in the workforce.
Aging workforce
Older employees who work longer and do not retire
The increased costs of public and private benefits for older workers
An increasing demand for products and services related to aging.

23. Current Trends and Issues (cont’d)
Entrepreneurship
The process whereby an individual or group of individuals uses organized efforts to create value and grow by fulfilling wants and needs through innovation and uniqueness.
Entrepreneurship themes (forms & ideas)
The pursuit (search) of opportunities
Innovation in products, services, or business methods
A desire for continual growth of the organization

24. Current Trends and Issues (cont’d)
E-Business (Electronic Business)
An organization that does its work performed by using electronic linkages – the Internet – to its key constituencies (members, parts, components of the organization).
E-commerce
The sales and marketing component of an e-business that uses electronic linkages to the public.

25. Current Trends and Issues (cont’d)
Knowledge Management
The cultivation (development) of a learning culture (mental attitude) where organizational members systematically gather and share knowledge with others in order to achieve better performance.
Learning Organization
An organization that has developed the capacity to continuously learn, adapt, and change.

26. Learning Organization versus Traditional Organization
Exhibit 2.10

27. Current Trends and Issues (cont’d)
Quality Management
A philosophy of management that is committed to (aimed at) continuous improvement in the quality of work processes and responding to customer needs and expectations.
Inspired by the total quality management (TQM) ideas of Deming and Juran
Quality is not directly related to cost; low quality may result in higher costs to the organization.

28. What is Quality Management?
Intense focus on the customer.
Concern for continual improvement.
Process-focused, e.g. quality of goods.
Improvement in the quality of everything the organization does.
Accurate measurement: Comparing the state of operations against standards.
Empowerment of employees: Involving people in the improvement process.
Exhibit 2.11

29. Chapter review Historical Background of Management pg. 25
Explain why studying management history is important.
Describe some early evidences of management practice.
Scientific Management pg. 27
Describe the important contributions made by Fredrick W. Taylor and Frank and Lillian Gilbreth.
Explain how today’s managers use scientific management.

30. Chapter review (cont’d)
General Administrative Theorists pg. 28
Discuss Fayol’s 14 management principles.
Describe Max Weber’s contribution to the general administrative theory of management.
Explain how today’s managers use general administrative theory.
Quantitative Approach to Management pg. 30
Explain what the quantitative approach has contributed to the field of management.
Discuss how today’s managers use the quantitative approach.

31. Chapter review (cont’d)
Toward Understanding Organizational Behavior pg. 31
Explain the conclusions of the Hawthorne Studies.
Discuss how today’s managers use the behavioral approach.
The Systems Approach pg. 33
Describe an organization using the systems approach.
Discuss how the systems approach is appropriate for understanding management.

32. Chapter review (cont’d)
The Contingency Approach pg. 35
Explain how the contingency approach differs from the early theories of management.
Discuss how the contingency approach is appropriate for studying management.
Current Issues and Trends pg. 36
Explain why we need to look at the current trends and issues facing managers.
Describe the current trends and issues facing managers.