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Management Theories

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Jonathon Leslie-Quam

on 24 March 2017

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Transcript of Management Theories

Management Theories
Management as a Process
Maslow ’s Hierarchy of Needs
The utility of Maslow’s hierarchy lies in its recognition that each individual is motivated by different needs. Maslow theorized that individuals respond differently throughout the life cycle. Further, some people may have dominant needs at a particular level and thus never move through the entire hierarchy.
Herzberg ’s Hygiene and Motivator Factors
Hygiene factors represent the work environment.
They include not just technical and physical conditions, but also such factors as company policies and procedures, supervision, the work itself, wages, and benefits.
Motivators involve aspects of the job such as recognition, achievement, responsibility, and individual growth and development.
Modern Approaches
This section focuses on several areas that illustrate the diverse range of the modern school of management: management effectiveness, systems approaches to management,
total quality management (TQM)
, and leadership approaches to organizations.
Psychologist Abraham Maslow theorized that employees have a series of needs that one can organize into a hierarchy.

As one level of needs is met, other levels of needs become important to the individual; as these levels are met, the progression through the hierarchy continues.
Frederick Herzberg, another psychologist, studied employee attitudes through a series of intensive interviews to determine which job variables made workers satisfied or dissatisfied.
By the 1960s management theorists began to integrate and expand elements of the classical and human relations schools.
Modern Approaches
To understand contemporary approaches to the study of management, it is helpful to review the major historical contributions to management theory.

The classical school of management that flourished from the late 1800s through the 1920s is associated with the Industrial Revolution, which marked a shift from agrarian-based to industrial-based societies.

Three different approaches to management, developed in three industrialized countries, represent the classical school: scientific management in the United States, administrative management in France, and bureaucratic management in Germany.
Management is often considered to be a process because of its ongoing state of operation. However, management has not always been thought of in these terms. The next section reviews different approaches to the study of management, from its formal beginnings to its most recent theories.

To understand contemporary approaches to the study of management, it is helpful to review the major historical contributions to management theory.

Human Relations
The notion that workers were motivated only by economic factors began to be challenged by many scholars in the 1930s and 1940s, giving rise to the human relations (or behavioral) school of management.

Managers and employees are in fact members of the same group.

Employees had needs other than just wages and benefits; with these needs met, workers would be more effective and the organization would benefit.

Many HR theories represent a micro perspective—that is, they center on the individual rather than the organization.
New Schools
The Hawthorne Studies
In 1924 the Western Electric Hawthorne plant in Cicero, Illinois, was used to investigate the impact of illumination (lighting) on worker productivity.
Harvard business professor Elton Mayo concluded that the human aspects of their work affected the productivity of General Electric’s employees more than the physical conditions.
Scientific Management
Presents a systematic approach to the challenge of increasing production.
The theory introduced several practices, including:
determination of the most effective way to coordinate tasks
careful selection of employees for different positions
proper training and development of the workforce
introduction of economic incentives to motivate employees.
Scientific management also proposed that workers would be more productive if they received higher wages in return for their labor. It views the worker mechanistically, suggesting that management could guarantee more output if better wages were promised in return.
Later approaches proposed that workers need more than just economic incentives to be productive.
Administrative Management
To aid managers in the planning, organizing, commanding, coordinating, and controlling functions Henry Fayol established a list of 14 principles of management.
Henry Fayol's POC3 Model
Fayol recognized that management principles must be flexible enough to accommodate changing circumstances. In that sense, Fayol was among the first management theorists to recognize management as a process.
Fayol was among the first management theorists to recognize management as a process.
1 . Division of work. Work should be divided according to specialization.
2. Authority and responsibility. The manager has authority to give directions and demand compliance along with appropriate responsibility.
3. Discipline. Respect and obedience is required of employees and the firm.
4. Unity of command. Orders should be received from a single supervisor.
5. Unity of direction. Similar activities should be under the direction of one leader.
6. Subordination of individual interest to general interest. Interests of a single employee do not outweigh those of the organization.
7. Remuneration of personnel. Wages are to be fair and equitable to all.
8. Centralization. Each organization must find the level of centralization of authority needed to maximize employee productivity.
9. Scalar chain. There is a line of authority in an organization, usually from top to bottom.
1 0. Order. All necessary materials should be located in the proper place for maximum efficiency.
1 1 . Equity. Fair and equitable treatment is needed for all employees.
1 2. Stability of tenure of personnel. Adequate time should be allowed for employees to adjust to new work and skills demanded.
1 3. Initiative. The ability to implement and develop a plan is crucial.
1 4. Esprit de corps. A spirit of harmony should be promoted among personnel.
Bureaucratic Management
In Germany, sociologist Max Weber focused on another aspect of worker productivity — organizational structure.
Weber theorized that strong organizational hierarchy - or bureaucracy - would enable an organization to produce at its highest level.

Weber called for a clear division of labor and management, a strong central authority, a system of seniority, strict discipline and control, clear policies and procedures, and careful selection of workers based primarily on technical qualifications.

The classical school of management concentrated on ways to make organizations more productive. Management was responsible for establishing clearly defined job responsibilities, maintaining close supervision, monitoring output, and making important decisions. Individual workers were thought to have little motivation to do their tasks beyond wages and other economic incentives.

These ideas would be challenged by the next major approach to management.


The term Hawthorne effect has come to describe the impact of management attention on employee productivity. Mayo’s work represents an important benchmark in the development of management thought by recognizing employees have social as well as physical and monetary needs.
Management Effectiveness
The classical and the human relations schools share productivity as a common goal, although they disagree on the means. The former proposes managerial efficiency and control, while the latter endorses employee needs and wants.
effectiveness -
the actual attainment of organizational goals
The classical and human relations schools consider effectiveness a natural and expected outcome.
Peter Drucker, considered the “father” of modern management theory, claimed that effectiveness is the very foundation of success for an organization - more important than efficiency.

Management by Objectives (MBO)

Created by Drucker, middle- and senior-level managers must identify the goals for each individual area of responsibility and share these goals and expectations with each unit and employee.

The shared objectives are used to guide individual units or departments and serve as a way management can monitor and evaluate progress.

Employees exhibit self-control to meet objectives
Management retains external control
Works with any organization of any size

Critics say it's time consuming to implement and difficult to maintain in rapidly changing business environments.

You can find traits of MBO in the electronic media, particularly in the areas of promotion, marketing, and financial planning, where performance objectives are carefully established and monitored.

Systems Approaches to Management
Macro perspective: the entire organization is examined, and the study includes the environment in which the organization operates
Organizations are similar to one another in that they are engaged in similar activities involving:
inputs (e.g., labor, capital, and equipment)
production processes (the conversion of inputs into some type of product)
outputs (e.g., products, goods, and services)

Organizations also study the external environment, evaluating feedback from the environment in order to identify change and assess goals.
Much of the uncertainty organizations face is due to environmental factors.

Organizations can alter their interdependence with other organizations in one of two ways:
(1) by absorbing other entities
(2) by cooperating with other organizations to reach mutual interdependence

Mergers and acquisitions, vertical integration and diversification are strategies organizations use to ease resource dependence.

Systems theory and the resource dependence perspective help one understand the relationship of the electronic media to other societal
systems. The media industries do not operate in isolation but form part of a larger system that also includes political, economic, technological, and social subsystems.
Useful approach for media organizations.
Theory X & Theory Y
Theory Z
Douglas McGregor (1960) noted that many managers still clung to traditional managerial assumptions that workers had little interest in work and lacked ambition.
McGregor labeled this style of management Theory X, which emphasized such tactics as control, threat, and coercion to motivate employees.
McGregor created Theory Y:
Managers did not rely on control and fear but integrated the needs of the workers instead and those of the organization.
Employees could exercise self-control and self-direction and develop their own sense of responsibility if given the opportunity.
The manager’s role in Theory Y centers on matching the talents of the individual with the proper position in the organization and providing an appropriate system of rewards.
Developed by William Ouchi (1981)

Based on Japanese business model
Theory Z cites employee participation and individual development as important components of organizational growth.
Interpersonal relations between workers and managers are stressed
However, Ouchi also drew from Theory X, in that management makes the key decisions in an organization, and a strong sense of authority must be maintained.
Total Quality Management
A series of approaches to emphasize quality in organizations, especially in regard to producing products and serving both external and internal customers.
Managers combine strategic approaches to deliver the best products and services by continuously improving every part of an operation:
Management implements and leads
Employees responsible for quality

Used effectively, TQM helps an organization maintain a competitive edge.
TQM has many areas of potential application in the electronic media, from the actual production of media content and advertising to the use of mission statements and public relations activities.
The popularity of TQM in the United States increased during the late 1970s and early 1980s, when U.S. business and industry were suffering from what many industrial experts labeled declining quality.
Strategic Management
Strategic management is primarily concerned with developing tools and techniques to analyze firms, industries, and competition, and developing strategies to gain a competitive advantage.
Strategic planning is one outgrowth of strategic management that has found wide application in electronic media.

In its simplest form, strategic planning involves a scanning of the external and internal environments by focusing on a firm’s individual strengths, weaknesses, opportunities, and threats (a SWOT analysis).
S.W.O.T. for PR
There is wide agreement that the most successful organizations have strong, effective leaders. Most organizations contain both formal and informal leaders, both those in recognized managerial positions and those not in such positions but who show wisdom and experience.
Leadership consists of three basic qualities:
: leaders have an understanding of where they want to go and will not let setbacks or obstacles deter their progress.
: a person who loves what they do.
: made up of self-knowledge, candor, and maturity
How is Leadership and Management different?
The leader innovates, while a manager administers.
Leaders offer a long-range perspective, while managers exhibit a short-range view.
Leaders originate, while managers imitate.
Transactional vs. Transformational Leadership:
Transactional leadership assumes people are motivated by rewards as well as punishment, and that systems work best with a defined chain of command.
Transactional leaders make clear to their subordinates what is required of them and reward or punish as needed.
Transformational leadership ideally follows transactional leaders; the difference between the two being transactional leadership is more focused on management practices, while transformational leadership involves vision and passion, and subordinates accept the vision of the leader.
Transformational leaders must constantly sell their vision and lead the change needed in an organization.
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