M A N AG E M E N T

& ITS
E VO L U T I O N
Bhashini Paranagama
WHAT IS A N
O RGA NIZAT IO N?

• An organization or organization, is an
entity comprising one or more people
and having a particular purpose.
Specialization and division of work.

Orientation towards goals. ...

Composition of individuals and groups. ...
 MA NAGEMENT
• Management can be defined as a process of getting
the work or the task done that is required for
achieving the goals of an organisation in an efficient
and effective manner.
• Management is the process of planning, organizing,
directing, and controlling resources (human, financial,
physical, and informational) to achieve organizational
goals effectively and efficiently (American
Management Association, 2012)
• To manage is to forecast and plan, to organize, to
command, to coordinate, and to control (Fayol,1916)
EFFICIENCY &
EFFECTIVENESS

• Efficiency is the ability to produce an intended

result in the way that results in the least waste
of time, effort, and resources.
• Effectiveness or effectivity is the capability of
producing a desired result or the ability to
produce desired output

• "Efficiency is doing things right. Effectiveness is

doing the right thing." (Drucker, 1964)
3 ISSUES THAT INFLUENCE THE
CONTEMPORARY BUSINESS WORLD

1. Management of Change
Organizational leaders must cope with
and adapt to rapid change on a daily
basis. Change creates uncertainty and
risk.
2. Increasing emphasis on
customer service
The company must satisfy the
needs of customers in ways that
contribute to long-term loyalty.
• Globalization is playing an increasingly
important role in the process of serving
both internal and external customers as
many companies are outsourcing entire
functions overseas
The $57 billion consumer-products company
Procter and Gamble has outsourced
everything from IT infrastructure and human
resources to management of its offices from
Cincinnati to Moscow
3. The need for higher business ethics
Ethics are the standards and values
which are considered necessary for the
collective interests of employees,
shareholders, and society.
T HE FO U R MA NAG EMENT F U NCT IO NS

• PLANNING AND STRATEGIZING Planning and strategizing are designed to lead the
company to fulfill its mission. Planning includes setting future objectives and mapping out
the activities necessary to achieve those objectives. To be effective, the objectives of
individuals, teams, and management should be carefully coordinated.
• ORGANIZING Specifying how the firm’s human, financial, physical, informational, and
technical resources are to be arranged and coordinated is the process of organizing.
• LEADING Energizing people to contribute their best individually and in cooperation with
other people is the leading function.
• CONTROLLING Measuring performance, comparing it to objectives, implementing
necessary changes, and monitoring progress are the functions of control
M A N AG E R I A L RO L E S

• INTERPERSONAL ROLES Managers engage in a great deal of interaction, continually

communicating with superiors, peers, subordinates and people from outside the
organization. In doing so, a manager serves as a figurehead, or the visible personality
representing an organization, department or work unit; a leader who energizes others to
get the job done properly; and a liaison who links together the activities of people from
both inside and outside the organization.
• INFORMATION ROLES Managers obtain, interpret, and give out a great deal of
information. These roles include being a monitor and disseminator, as well as the
organization’s spokesperson.
• DECISIONAL ROLES Managers are also asked to choose among competing alternatives.
This includes balancing the interests of the various parties who have a stake in a decision.
Four decisional roles include that of entrepreneur, who introduces changes into the
organization; disturbance handler, who takes corrective action, provides damage control,
and responds to unexpected situations or crises; resource allocator, responsible for
assigning people and other resources to best meet organizational needs; and negotiator,
reaching agreements and making compromises
AC T I V I T Y 1

• Describe a situation in real life in which you can

observe the major 3 managerial roles?
THE EVOLUTION OF MANAGEMENT
THOUGHT
• The Operational Perspective
The operational perspective on management thought originated in the 19th and early 20th
centuries. It coincided with the rise of the factory system and the formation of modern
corporations, both of which provided challenges in efficiently operating and coordinating
large, complex organizations.
SCIENTIFIC
MA NAGEMENT

• A management method that applies the

principles of the scientific method to the
management process: determining the one best
way to do a job and sharing the rewards with
the workers.
TAYLOR’S FOUR PRINCIPLES OF
SCIENTIFIC MANAGEMENT
• 1. Scientifically study each part of a task and develop the best method of performing the
task.
• 2. Carefully select workers and train them to perform the task by using the scientifically
developed method.

• 3. Cooperate fully with workers to ensure that they use the proper method.
• 4. Divide work and responsibility so that management is responsible for planning work
methods using scientific principles and workers are responsible for executing the work
accordingly
• Following Taylor’s footsteps Frank
Gilbreth and Lillian Gilbreth
introduced the idea of time and
motion studies using the stopwatch
and motion picture camera to
improve workplace efficiencies. The
Gilbreths analyzed each movement a
worker performed during a particular
task by filming the task actions and
observing the film frame by frame.
They then looked for better ways to
perform each step to ensure that all
the steps could be performed more
efficiently with less time and effort
• Scientific management had a
profound effect on the captains of
U.S. industry. In one of the most
famous applications, Henry Ford
utilized scientific management in
the production process of the
factory that manufactured the
Model-T Ford.
AC T I V I T Y

• Discuss the modern business

contexts where scientific
management principles are
applied.
• The scientific management perspective later
became known as the “quantitative
management” school. The focus is on the
development of various statistical tools and
techniques to improve efficiency and allow
management to make informed decisions
regarding the costs and benefits of alternative
courses of action. Four of these quantitative
methods, which are still widely used today,
include: (1) break-even analysis, (2) basic
economic order quantity (EOQ) model, (3)
material requirements planning (MRP), and (4)
quality management.
• The need for improved product quality emerged
in the 1980s, when it became apparent that the
United States was lagging behind some
industrialized countries, most notably Japan, in
the area of product quality.
B U R E AU C R AT I C
MA NAGEMENT

• Another traditional perspective is bureaucratic

management, which examines the entire organization as
a rational entity. Max Weber (1864–1920), a German
sociologist, introduced the concept of bureaucratic
management as an “ideal” model that managers should
try to emulate in order to operate an organization on a
fair, rational, and efficient basis. According to Weber, the
ideal bureaucracy should use impersonal rules and
procedures for decision making rather than custom, family
connections, or social class.
 K E Y C H A R AC T E R I S T I C S O F W E B E R ’ S
I D E A L B U R E AU C R AC Y
1. Specialization of labor
Jobs are broken down into routine, well-defined tasks so that members know what is expected of
them and can become extremely competent at their particular subset of tasks.
2. Formal rules and procedures
Written rules and procedures specifying the behaviors desired from members facilitate
coordination and ensure uniformity.
3. Impersonality
Rules, procedures, and sanctions are applied uniformly regardless of individual personalities and
personal considerations.
4. Well-defined hierarchy
Multiple levels of positions, with carefully determined reporting relationships among levels, provide
supervision of lower offices by higher ones, a means of handling exceptions, and the ability to
establish accountability of actions.
5. Career advancement based on merit
Selection and promotion are based on the qualifications and performance of members.
A DMINIS T RAT IVE
MA NAGEMENT

• The administrative management approach

examines an organization from the perspective
of the managers and executives responsible for
coordinating the activities of diverse groups and
units across the entire organization. It views
management as a profession that can be
learned by understanding basic principles. The
key advocate was Henri Fayol (1841–1925), a
French mining engineer and industrialist.
S O M E P R I N C I P L E S A DVO C AT E D BY FAYO L

• Unity of command.
Each employee should be assigned to only one supervisor.
• Unity of direction.
The employees’ efforts should be focused on achieving organizational objectives.
• Equity.
Employees should be treated with justice and respect
B E H AV I O R A L
PERSPECTIVE

• The behavioral perspective incorporates

psychological and social processes of human
behavior to improve productivity and work
satisfaction. Operational theorists view
management as a mechanical process in which
employees would fit into any job or organization
designed for optimum efficiency if given monetary
incentives to do so. The behavioral perspective
argues that human factors alone may affect
workplace efficiency
 T H E H AW T H O R N E
STUDIES

• The Hawthorne studies were performed at the

Western Electric Company’s Hawthorne plant near
Chicago from 1924 to 1932 under the direction of
Harvard University researchers Elton Mayo and Fritz
Roethlisberger.
• In the first set of studies, light was steadily
decreased for an experimental group of
employees, while illumination remained
constant for the control group of employees
working in a different area. Despite the
different levels of illumination, the
performance of both groups of employees
rose consistently. This result surprised the
researchers, who expected the control group
to outperform its experimental counterpart.
They concluded that the special attention
paid to the employees in the studies
motivated them to put greater effort into their
jobs. They labelled the phenomenon the
Hawthorne effect, and suggested that when
a manager or leader shows concern for
employees, their motivation and productivity
levels are likely to improve.
HUMAN
RELATIONS

• The human relations approach to management

made relationships between employees and
supervisors a vital aspect of management. Its
advocates were people trained in the
behavioral sciences, such as clinical and social
psychologists, who emphasized building
collaborative and cooperative relationships
between supervisors and workers. Two key
aspects of the human relations approach are
focused on employee motivation and
leadership style.
C O N T E M P O R A RY M A N AG E M E N T
PERSPECTIVES
• CONTINGENCY THEORY
According to contingency theory, what works for one organization may not work for another,
because situational characteristics differ. The situational characteristics are called
contingencies.