ORGANIZATION AND

MANAGEMENTCHAPTER 1: NATURE AND

CONCEPT OF MANAGEMENT

REMINDERS•CLASS ROOM RULES•ASSIGNMENT•CLEANLINESS OF THE ROOM•REVIEW

REVIEW1. It is the process of reaching organizational goals by working

with and through people and other organizational resources.2. This involves choosing tasks that must be performed to attain

organizational goals, to outline how the tasks must be performed and to indicate when they should performed.

3. It involves the act assigning of tasks, people within the organization are given work assignments that contribute to the attainment of the goals.

4. It involves leading by guiding the activities of the organization members towards the fulfillment of the goals.

5. It is the process of checking the performance against standard performance.

6. It includes manpower planning, recruitment, selection, placement and training.

POST TEST

1. Published “The Wealth of Nations” in 1776, advocated the division of labor (job specialization, the breakdown of jobs into narrow, repetitive tasks.) to increase the productivity of workers

2. Substituted machine power for human labor, created large organizations in need of management

3. The father of scientific management, known on his “pig iron experiment that probably the widely cited example of scientific management.

4. An approach or theory of management that involves in using scientific method to determine the “one best way for a job to be done”.

5. They were inspired by Taylor and develop their own methods of scientific management, they were among the first to use motion picture films to study hand and body motions in order to eliminate the wasteful one.

F.W Taylor General Administrative Theory

Henri Fayol Industrial Revolution

Frank and Lilian Gilbreth

Division of Work Adam Smith Scientific management

Therblig Authority

POST TEST

1. This are the 18 kinds of elemental motions used in the study of motion economy in the workplace, it was devised by the Gilbreths

2. This management theory focused on the entire organization, develop more general theories of what managers do and what constitute good managements practice.

3. He focused on activities common to all managers, described the practice of management as distinct from other typical business functions, and stated the 14 principles of management.

4. It means that work should be divided among individuals and groups to ensure that effort and attention are focused on special portions of the task.

5. Was defined by Fayol as the right to give orders and the power to exact obedience.

F.W Taylor General Administrative Theory

Henri Fayol Industrial Revolution

Frank and Lilian Gilbreth

Division of Work

Adam Smith Scientific management

Therblig Authority

Brisk walkingRunning/JoggingBicyclingAerobic DancingSwimmingAero-King Boxing

 Ballroom DancingBadminton,

Basketball, SoftballSkating/Roller

BladingTennis

Piko, Sipa, Patintero

 

StretchingYogaTai ChiResistance Training

 

 Go mall-strollingPlay GolfGo Bowling

 

 Sit aroundBe a couch potatoWatch TVPlay cards/MahjongSit and do needle workIndulge in computer games and surfing

 

 Taking the stairs

instead of elevatorTaking longer

routesWalking to the store, church,

banks or mailboxParking your car

farther away

MANAGE YOUR ACTIVITY USING THE PYRAMID

MINIMALLY(a few times a month)

OFTEN(2-3 times a week at

least 30-45 minutes or longer

REGULARLY3-5 times a week; at least 30-45 minutes

longer 

HABITUALLY(as often as possible)

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HOW WAS IT POSSIBLE FOR THESE PROJECTS TO BE COMPLETED?

2–11

HISTORICAL BACKGROUND OF MANAGEMENT

•Ancient Management• There are many examples from past history that illustrate how management has been practiced for thousands of years.• A. The Egyptian pyramids and the Great Wall of China are good examples of projects of tremendous scope and magnitude that employed tens of thousands of people. How was it possible for these projects to be completed? The answer is management.

Adam SmithPublished “The Wealth of Nations” in 1776

Advocated the division of labor (job specialization, the breakdown of jobs into narrow, repetitive tasks.) to increase the productivity of workers

Industrial Revolution

Substituted machine power for human laborCreated large organizations in need of management

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DEVELOPMENT OF MAJOR MANAGEMENT THEORIES

© 2007 Prentice Hall, Inc. All rights reserved. 2–15

MAJOR APPROACHES/THEORY TO MANAGEMENT•Scientific Management•General Administrative Theory•Quantitative Management•Organizational Behavior•Systems Approach•Contingency Approach

•Fredrick Winslow Taylor–The “father” of scientific management

–Published Principles of Scientific Management (1911)

1. SCIENTIFIC MANAGEMENT

The theory of scientific management

Using scientific methods to define the “one best way” for a job to be done:

1. Putting the right person on the job with the correct tools and equipment.2. Having a standardized method of doing the job.3. Providing an economic incentive to the worker.

His “pig iron” experiment is probably the most widely cited example ofscientific management.

Taylor sought to create a mental revolution among both workers andmanagers by defining clear guidelines for improving production efficiency. Hedefined four principles of management

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E TAYLOR’S FOUR PRINCIPLES OF MANAGEMENT

1. Develop a science for each element of an individual’s work, which will replace the old rule-of-thumb method.

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E TAYLOR’S FOUR PRINCIPLES OF MANAGEMENT

1.Scientifically select and then train, teach, and develop the worker.

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E TAYLOR’S FOUR PRINCIPLES OF MANAGEMENT

1.Heartily cooperate with the workers so as to ensure that all work is done in accordance with the principles of the science that has been developed.

© 2007 Prentice Hall, Inc. All rights reserved. 2–27

E TAYLOR’S FOUR PRINCIPLES OF MANAGEMENT

1.Divide work and responsibility almost equally between management and workers. Management takes over all work for which it is better fitted than the workers.

Scientific Management Frank and Lillian Gilbreth were inspired by Taylor’swork and went on to study and develop their ownmethods of scientific management.

Scientific Management

a. Frank Gilbreth is probably best known for his experiments in reducing the number of motions in bricklaying.

Scientific Managementb. The Gilbreths were among the first to use motionpicture films to study hand and body motions in orderto eliminate the wasteful ones.

Scientific Management

c. They also devised a classification scheme to label17/18 basic hand motions called therbligs.Therbligs are 18 kinds of elemental motions used in the study of motion economy in the workplace. A workplace task is analyzed by recording each of the therblig units for a process, with the results used for optimization of manual labour by eliminating unneeded movements.

Guidelines devised by Taylor and others to improve production efficiency are still used in today’s organizations. However, current management practice is not restricted to scientific management practices alone. Elements of scientific management still used include:

1. Using time and motion studies2. Hiring best qualified workers3. Designing incentive systems based on output

2. GENERAL ADMINISTRATIVE THEORISTS

This group of writers, who focused on the entire organization, developed more general theories of what managers do and what constitutes good management practice.

Henri Fayol and Max Weber were the two most prominent proponents of the general administrative approach.

GENERAL ADMINISTRATIVE THEORISTS

Fayol focused on activities common to all managers. He described the practice of management as distinct from other typical business functions.

GENERAL ADMINISTRATIVE THEORISTS

Fayol stated 14 principles of management which are as follows:1. Division of Work2. Authority3. Discipline4. Unity of Command5. Unity of Direction6. Subordination of individual interest to group interest7. Remuneration8. Centralization9. Scalar Chain10. Order11. Equity12. Stability13. Initiative14. Espirit de corps

DIVISION OF WORK: Work should be divided among individuals and groups to ensure  that effort and attention are focused on special portions of the task. Fayol presented work specialization as the best way to use the human resources of the organization.   

AUTHORITY: The concepts of Authority and responsibility are closely related. Authority was defined by Fayol as the right to give orders and the power to exact obedience. Responsibility involves being accountable, and is therefore naturally associated with authority. Whoever assumes authority also assumes responsibility.       

DISCIPLINE: A successful organization requires the common effort of workers. Penalties should be applied judiciously to encourage this common effort.     

UNITY OF COMMAND: Workers should receive orders from only one manager. 

UNITY OF DIRECTION: The entire organization should be moving towards a common objective in a common direction.            

SUBORDINATION OF INDIVIDUAL INTERESTS TO THE GENERAL INTERESTS: The interests of one person should not take priority over the interests of the organization as a whole.   

REMUNERATION: Many variables, such as cost of living, supply of qualified personnel, general business conditions, and success of the business, should be considered in determining a worker’s rate of pay.   

CENTRALIZATION: Fayol defined centralization as lowering the importance of the subordinate role. Decentralization is increasing the importance. The degree to which centralization or decentralization should be adopted depends on the specific organization in which the manager is working.

SCALAR CHAIN: Managers in hierarchies are part of a chain like authority scale. Each manager, from the first line supervisor to the president, possess certain amounts of authority. The President possesses the most authority; the first line supervisor the least. Lower level managers should always keep upper level managers informed of their work activities. The existence of a scalar chain and adherence to it are necessary if the organization is to be successful.      

ORDER: For the sake of efficiency and coordination, all materials and people related to a specific kind of work should be treated as equally as possible.   

EQUITY: All employees should be treated as equally as possible.      

STABILITY OF TENURE OF PERSONNEL: Retaining productive employees should always be a high priority of management. Recruitment and Selection Costs, as well as increased product-reject rates are usually associated with hiring new workers.  

INITIATIVE: Management should take steps to encourage worker initiative, which is defined as new or additional work activity undertaken through self direction.      

ESPIRIT DE CORPS: Management should encourage harmony and general good feelings among employees.

Max Weber was a German sociologist who developed a theory of authority structures and described organizational activity based on authority relations.

He described the ideal form of organization as a bureaucracy marked by division of labor, a clearly defined hierarchy, detailed rules and regulations, and impersonal relationships

3) QUANTITATIVE APPROACH TO MANAGEMENT

The quantitative approach to management, sometimes known as operations research or management science, uses quantitative techniques to improve decision making.

Operations research, or operational research in British usage, is a discipline that deals with the application of advanced analytical methods to help make better decisions.

management science. management science. The study of statistical methods, such as linear programming and simulation, in order to analyze and solve organizational problems. Same as operations research.

This approach includesa. applications of statisticsb. optimization modelsc. computer simulations of management activities.

Linear programming - improves resource allocationdecisionsCritical-path scheduling analysis - improves workscheduling

The field of study concerned with the actions (behaviors) of people at work is organizational behavior. Organizational behavior (OB) research has contributed much of what we know about human resources management and contemporary views of motivation, leadership, trust, teamwork, and conflict management.

4) ORGANIZATIONAL BEHAVIOR

Early Advocates of OB Four people stand out as early advocates of the OB approach. These include Robert Owen, Hugo Munsterberg, Mary Parker Follett, and ChesterBarnard.

1. Robert Owen, a successful Scottish businessman, proposed a utopian workplace.

Early Advocates of OB

2. Hugo Munsterberg -created the field of industrial psychology—the scientific study of individuals at work to maximize their productivity and 2 – 16 adjustment.

3. Mary Parker Follett -was a social philosopher who thought the manager’s job was to harmonize and coordinate group efforts.

4. Chester Barnard, president of New Jersey Bell Telephone Company, saw organizations as social systems that required human cooperation. a. He believed that managers’ major roles were to communicate and stimulate subordinates to high levels of effort. b. He also introduced the idea that managers have to examine the environment and then adjust the organization to maintain a state of equilibrium.

This series of experiments conducted from 1924 to the early 1930s at Western Electric Company’s Hawthorne Works in Cicero, Illinois, were initially devised as a scientific management experiment to assess the impact of changes in various physical environment variables on employee productivity.

The Hawthorne Studies were the most important contribution to the development of organizational behavior.

After Harvard professor Elton Mayo and his associates joined the study as consultants, other experiments were included to look at redesigning jobs, make changes in workday and workweek length, introduce rest periods, and introduce individual versus group wage plans.

The researchers concluded that social norms or group standards were key determinants of individual work behavior.Although not without criticism (concerning procedures, analyses of findings, and the conclusions), the Hawthorne Studies stimulated interest in human behavior in organizational settings.In the present day context behavioral approach assists managers in designing jobs that motivate workers, in working with employee teams, and in facilitating the flow of communication within organizations. The behavioral approachprovides the foundation for current theories of motivation, leadership, and group behavior and development.

5) THE SYSTEMS APPROACHDuring the 1960s researchers began to analyze organizations from a systems perspective based on the physical sciences. A system is a set of interrelated and interdependent parts arranged in a manner that produces a unified whole. The two basic types of systems are open and closed. A closed system is notinfluenced by and does not interact with its environment. An open system interacts with its environment.

6) THE CONTINGENCY APPROACHThe contingency approach recognizes that different organizations require different ways of managing. The contingency approach to management is a view that the organization recognizes and responds to situational variables as they arise

Globalization: Organizational operations are no longer limited by national borders.Managers throughout the world must deal with new opportunities and challengesinherent in the globalization of business.

CURRENT TRENDS AND ISSUESThe following are the current concepts and practices are changing the way managers do their jobs today.

Ethics: Cases of corporate lying, misrepresentations, and financial manipulations have been widespread in recent years. Managers of firms such as Enron, ImClone, Global Crossing, and Tyco International have placed their own self-interest ahead of other stakeholders’ welfare. While most managers continue to behave in a highly ethical manner, abuses suggest a need to “upgrade” ethical standards. Ethics education is increasingly emphasized in college curricula today. Organizations are taking a more active role in creating and using codes of ethics, ethics training programs, and ethical hiring procedures.

Workforce diversity: It refers to a workforce that is heterogeneous in terms of gender, race, ethnicity, age, and other characteristics that reflect differences. Accommodating diverse groups of people by addressing different lifestyles, family needs, and work styles is a major challenge for today’s managers.

Entrepreneurship: It is the process whereby an individual or group of individuals use organized efforts to pursue opportunities to create value and grow by fulfilling wants and needs through innovation and uniqueness, no matter what resources the entrepreneur currently has.

Managing in an E-Business World: E-business (electronic business) is a comprehensive term describing the way an organization does its work by using electronic (Internet-based) linkages with its key constituencies in order to efficiently and effectively achieve its goals.

Knowledge Management and Learning Organizations: Change is occurring at an unprecedented rate. To be successful, today’s organization must become a learning organization—one that has developed the capacity to continuously learn, adapt, and change. Knowledge management involves cultivating a learning culture where organizational members systematically gather knowledge and share it with others in the organization so as to achieve better performance.

Quality Management: Quality management is a philosophy of management that is driven by continual improvement and response to customer needs and expectations. The objective of quality management is to create an organization committed to continuous improvement in work.