Chapter Two
Traditional and
Contemporary
Issues and
Challenges
Learning Objectives
After studying this chapter, you should be able to:
1. Summarize and evaluate the classical perspective on
management, including scientific and administrative management,
and note its relevance to contemporary managers.
2. Summarize and evaluate the behavioral perspective on
management, including the Hawthorne studies, human relations
movement, and organizational behavior, and note its relevance to
contemporary managers.
3. Summarize and evaluate the quantitative perspective on
management, including management science and operations
management, and note its relevance to contemporary managers.
4. Discuss the systems and contingency approaches to
management and explain their potential for integrating the other
areas of management.
Case
You are a management
consultant and is
required to recommend
ways to increase the low
productivity of Bapcos
workers at oil processing
department.
How to increase productivity?
Find ways to Find ways to Find ways to
increase the understand improve the
efficiency of the individuals operation,
individual behavior, decision making
workers and the groups and and resource
whole teams, to allocation
orgnisation motivate them
and effectively
lead them
How to increase productivity?
Find ways to Find ways to Find ways to
increase the understand improve the
efficiency of the individuals operation,
individual behavior, decision making
workers and the groups and and resource
whole teams, to allocation
orgnisation motivate them
and effectively
lead them
Classical Behavioral Quantitative
Management Perspective
Classical Behavioral Quantitative
Management Management Management
Perspectives Perspectives Perspectives
Universal Mgt Perspective: One best way
Management Perspectives
Classical Behavioral Quantitative
Management Management Management
Perspectives Perspectives Perspectives
Methods for Insights for moti- Techniques for
enhancing vating performance improving decision
efficiency and and understanding making, resource
facilitating planning, individual behavior, allocation, and
organizing, and
groups and teams, operations
and leadership
controlling
Systems Approach Contingency Perspective
An Integrative Recognition of internal Recognition of the situational
Framework of interdependencies nature of management
Management Recognition of Response to particular
environmental influences characteristics of situation
Perspectives
Classical Behavioral Quantitative
Management Management Management
Perspectives Perspectives Perspectives
Methods for Insights for moti- Techniques for
Universal enhancing vating performance improving decision
Management efficiency and and understanding making, resource
facilitating planning, individual behavior, allocation, and
Perspectives organizing, and groups and teams, operations
controlling and leadership
Effective and efficient management
THE MANAGEMENT PERSPECTIVE
THE UNIVERSAL MANAGEMENT PERSPECTIVE
Classical
Scientific Management
Administrative Management
Behavioral
Hawthorn Study
The Human Relations Movement
Organizational Behavior
Quantitative
Management Science
Operation Management
INTEGRATING PERSPECTIVES FOR MANAGERS
System Approach
Contingency Theory
Classical Management Branches
Scientific Management
Increasing the efficiency
of the individual worker
Administrative
Management
Focuses on managing the
total organization
Scientific Management Perspective
Fredrick Taylor Frank and Lillian Gilbreth
Henry Gantt Harrington Emerson
Fredrick Taylor
Soldiering Employees deliberately working at a
slow pace
To increase the efficiency of the individual
worker
Redesigned Jobs: Observe, Select, Train , Implement PPS
Piecework pay system Any work that is produced above
the target level of output will be paid by the piece
Rest periods
Frank and Lillian Gilbreth
(Husband and Wife) Industrial engineers
Frank Bricklaying
Standardization of Materials
Procedures to perform the job
Result- Increase output by 200%
Lillian Industrial psychology + Personnel mgt
Both Cheaper by the Dozen
Henry Gantt
Developed other
techniques,
including the Gantt
chart, to improve
working efficiency
through
planning/scheduling
Henry Gantt A scheduling Devise
Completed Week 1 Week 2 Week 3 Week 4
Planned 1 2 3 4 5 8 9 10 11 12 15 16 17 18 19 22 23 24 25 26
1. Design
2. Purchase Parts
3. Fabricate Bodies
4. Fabricate Frames
5. Build Drive Trains
6. Assemble Carts
7. Test Carts
Harrington Emerson
Consultant -1910
Interstate Commerce
Commission
By using Scientific management
railroads could save $1 million a
day
Advocated job specialization in
both managerial and operating
jobs.
How would the scientific mgt scholars improve
the productivity of workers at Bapco?
Fredrick Taylor Frank and Lillian Gilbreth
Henry Gantt Harrington Emerson
How would the following scientific management scholars
improve the productivity of workers at Bapco?
Frank and
Fredrick Taylor Lillian Gilbreth
Harrington
Henry Gantt Emerson
Classical Management Branches
Scientific Management
Increasing the efficiency of
the individual worker
Administrative
Management
Focuses on managing the
total organization
Administrative Management
Focuses on managing the total
organization
Henry Fayol,
Max Weber
Chester Barnard
Lyndall Urwick
Administrative Management Perspective
Henry Fayol Max Weber
Chester Bernard Lyndal Urwick
Henri Fayol
French industrialist
Systematize the
practice of management
Identified managerial
functions
Max Weber
German Sociologist
Bureaucratic
Structure
guidelines for
structuring the
organization in the
most efficient way
Chester Barnard
The Functions of the
Executive- book
Subordinates Acceptance of
Authority
= f (understands it;
able to comply with it;
views it as appropriate)
Lyndall Urwick
Scientific Mgt + Administrative
Mgt
Advanced our thinking managerial
functions and managerial
effectiveness
No specific new contributions but
rather the integration of the
previous theories
Administrative Management Perspective
Henry Max
Fayol Weber
Chester Lyndal
Bernard Urwick
Contributions Limitations
Foundations - Is it appropriate now
Identified - Is it universal
processes, skills,
functions
- Is it right to treat
mgt valid subject employees as tools
of scientific inquiry
The Behavioral Management Perspective
Placed emphasis on
individual attitudes
and behaviors and
on group
processes and
recognized the
importance of
behavioral
processes in the
work place.
Branches of Behavioral Mgt Perspective
Hawthorne Studies
The Human Relations
Movement
Organizational
Behavior
Hawthorn Studies
Years 1927-1932
Founder
Elton Mayo & Colleagues
Place Western Electric
Lighting Experiment
Piecework Incentive Pay
Interview program
Hawthorn Studies - Findings
Importance of Human
Element
Recognition - Feeling
important
Belonging to a group
relationships
The Human Relations Movement
Proposed that workers
respond primarily to the
social context of the
workplace, including
social conditioning,
group norms, and
interpersonal dynamics
Maslows Hierarchy of
Need
McGregor Theory X &
Y
Maslows Hierarchy of Needs
Self-actualization needs
Esteem needs
Social needs
Safety needs
Physiological needs
Behavioral Theory on How Employees Behave Toward Work - pessimistic
Employees
dislike work.
are irresponsible.
lack ambition.
resist change.
Another Theory on How Employees Behave Optimistic
Employees are
willing to work.
self directed.
accept responsibility.
creative.
self-controlled
Organizational Behavior
Psychology, sociology, anthropology, economics, and
medicine.
Individual + Group + organizational processes
Stress, motivation, group dynamics, interpersonal
conflict, job satisfaction, organizational politics
Contributions Limitations
+ Challenged - Prediction of
thinking human behavior
+ Insights into
- motivation - Adaptation
- group dynamics
- interpersonal - Communication
processes in
The Quantitative Management Perspective
Decision making,
mathematical models,
use of computers
Management
Science
Operations
Management
The Quantitative Management Perspective
Management Science
Focuses specifically on the
development of mathematical
models (simplified representation
of a system, process, or a
relationship)
Operations Management
Applies quantitative techniques
(mgt science) to management to
help the organization produces
goods and services more
efficiently and to run the operation
Inventory Mgt
Linear Programming
Mgt Science and Operations Management
Mgt Science and Operations Management
Mgt Science and Operations Management
BEQ = FC / (TC-VC)
Development mathematical equation
Application of Mathematical Equation using BEQ to determine
the minimum quantity that must be produced to cover all the
costs
Contributions Limitations
Techniques to assist - Not fully able to
in decision making predict human
behavior
Awareness of
complex
organizational - Costs vs. other
processes skills
Planning and
controlling - Assumptions
Are the three
management
perspectives
contradictory or
complimentary
Integrating Perspectives for Managers
A complete understanding of management requires
an appreciation of, classical, behavioral, and
quantitative approaches.
The systems perspectives and
Contingency perspectives
An Integrative Framework of
Management Perspectives
Systems Approach Contingency Perspective
Recognition of internal Recognition of the situational
interdependencies nature of management
Recognition of Response to particular
environmental influences characteristics of situation
Classical Behavioral Quantitative
Management Management Management
Perspectives Perspectives Perspectives
Methods for Insights for moti- Techniques for
enhancing vating performance improving decision
efficiency and and understanding making, resource
facilitating planning, individual behavior, allocation, and
organizing, and groups and teams, operations
controlling and leadership
Effective and efficient management
Copyright Houghton Mifflin Company. All rights reserved.
The Systems Perspective
of Organizations
Transform
Inputs from ation Outputs
the into
Process:
environment: the environment:
technology,
material inputs, products/services,
operating
human inputs, systems, profits/losses,
financial inputs, and administrative employee behaviors,
information inputs. systems, and and information
control systems outputs
Feedback
Match the example with the appropriate concept that illustrates it:
Open system, Closed System, Subsystem, Synergy, Entropy
Hewlett-Packard and Compaq is merger is based on the notion that
working together in a cooperative and coordinated fashion will benefit
the two companies more than working alone.
IN ALBA, a decision that was taken by the production department to
lower he quality of the materials used will effect the Finance and
marketing departments. There is an autonomy for each department, but
decisions of one department affects the others. This is because the
departments are -------------.
One of the reasons attributed to the failure of Bahrain Cinema Company
in the 80s was that they ignore the effect of the of VCRs (videos) on
their demand.
UOB monitors the quality of its services by requiring students to
evaluate their instructors and the subject.
The main reason attributed to ENRONs failure is overlooking a simple
process of checking the money used versus the quota of their brokers.
The System Perspective - Concepts
Open system
Closed systems
Subsystem
Synergy
Entropy
Open System
An
organizational
system that
interacts with
its
environment
Closed System
An organizational
system that
doesnt interacts
with its
environment
Subsystem
A system
within
another
broader
system
Synergy
Synergy two or
more
subsystems
working together
may often be
more successful
then working
alone
Entropy
A normal
process
leading to
system
decline
Contingency vs. Universals
Universal perspective:
tempting to identify one
best way.
Contingency perspective:
depending on
elements in that situation.
Figure 2.5: The Emergence of Modern
Management Perspectives
Copyright Houghton Mifflin Company. All rights reserved.
Contemporary Mgt Challenges
Labor shortage
Management of diversified workforce
Values, goals and beliefs of the new generation
workforce
Management of change
Organizational Structure
Information Technology
Globalization and its effect
Ethics and social responsibility
Quality & its importance for competitiveness
Service Economy
Labor Shortage
Advancement in technology
Demand for technology-related employees (salaries)
Effect on Lower-skills jobs
Management of Diversified Workforce
Differences among people
Internationalization factor
Difficulty in management
Values, Goals and Beliefs of the New
Generation Workforce
Less devoted to long-term career prospects
Less to Conformity and uniformity
How to attract and motivate
Flexibility
Management of Change
Rapid and constant environment change
Change is an opportunity
New Technology
Internet, e-business, e-government, Information technology
Investment in technology
Employee-privacy
Decision-making quality
Physical or virtual offices
Organization Structure
Webers bureaucratic structure
Now, Flat structure
Globalization
Role of government in business
Behavioral processes vary widely
Values and beliefs of Bahraini vs. Japanese employee
Ethics and Social Responsibility
Business scandals
Increased contributions to social issues
Quality
Used as a base for competition
Quality and productivity
Service Economy
Traditionally, manufacturer
Now, half of GDP of USA from service industries
