MODULE 2

Management Approaches
 Major Approaches to Management

Classical Management Approach

• Scientific Management
• General Administrative Theory
Neo Classical Theories
• Human Relation School 4 basic experiments
Modern Approaches
• Quantitative Management
• Systems Approach
• Contingency Approach
2–3
• Koi Practice Nahin Hogi | Dialogue Promo | Chak
De India | Shah Rukh Khan, Shilpa | Shimit Amin – YouTube
Scientific Management
• Fredrick Winslow Taylor
• The “father” of scientific management
• Published Principles of Scientific Management (1911)
• The theory of scientific management
• Using 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 a standardized method of doing the job.
• Providing an economic incentive to the worker.

2–5
 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.
2. Scientifically select and then train, teach, and develop the worker.
3. 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.
4. Divide work and responsibility almost equally between management and
workers. Management takes over all work for which it is better fitted than the
workers.

2–6
I am the Coach | Scene | Chak De India | Shah Rukh Khan | Shimit Amin - YouTube
Scientific Management (cont’d)
• Frank and Lillian Gilbreth
• Focused on increasing worker productivity through the reduction of wasted
motion
• Developed the microchronometer to time worker motions and optimize work
performance
• How Do Today’s Managers Use Scientific Management?
• Use time and motion studies to increase productivity
• Hire the best qualified employees
• Design incentive systems based on output

2–8
General Administrative Theory
• Henri Fayol
• 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)
• Emphasized rationality, predictability, impersonality, technical competence, and
authoritarianism

2–9
Fayol’s 14 Principles of Management
1. Division of work. 7. Remuneration.
2. Authority. 8. Centralization.
3. Discipline. 9. Scalar chain.
4. Unity of command. 10. Order.
5. Unity of direction. 11. Equity.
6. Subordination of 12. Stability of tenure of
individual interests to personnel.
the general interest. 13. Initiative.
14. Esprit de corps.

2–10
Iss Team Ka Gunda Main Hoon | Scene | Chak
De India | Shah Rukh Khan | Sagarika, Shilpa, Tanya Abrol – YouTube
Motion and Time Study
• By Frank and Lillian Gilbreth
• Motion and time study can reduce and control costs, improve working conditions and environment, and motivate people.
• The basic purpose is to improve the work and to reduce waste.

1. Motion analysis techniques

2. Time study techniques
3. Uses of time standards.

• Motion Study is designed to determine to best way to complete a repetitive job

• Time Study measures how long it takes an average worker to complete a task
at a normal pace
 How would you answer the following questions without time
standards?

How Many Machines Do We Need?

• One of the first questions rose when setting up a new operation or starting production on a new product is “how many
machines do we need?” The answer depends on two pieces of information:

a. How many pieces do we need to manufacture per shift?

b. How much time does it take to make one part? (Time standard)

EXAMPLE

1. The marketing department wants us to make 2,000 wagons per 8-hour shift.
2. It takes us 0.400 minutes to form the wagon body on a press.
3. There are 480 minutes per shift (8 hours/shift x 60 minutes/hr).
4. - 50 minutes downtime per shift (breaks, clean-up, etc.)
5. There are 430 minutes per shift available @ 100%.
6. @ 75% performance (based on history) (0.75 x 430 = 322.5).
7. There are 322.5 effective minutes left to produce 2,000 units.

322.5
8. ---------------- = 0.161 minutes per unit,
2,000 units
• The 0.161 minutes per unit is plant rate. Every operation in the plant
must produce a part every 0.161 minutes; therefore, how many
machines do we need for this operation?

Time standard = 0.400 minutes/unit

----------------------------------------------------- = 2.48 machines
Plant rate = 0.161 minutes/unit

• This operation requires 2.48 machines. If other operations are required

for this kind of machine, we would add all the machine requirements
together and round up to the next whole number.

• In this example, we would buy three machines. (Never round down on

your own. You will be building a bottleneck in your plant.)
• For example, how many direct labor employees do we need for a multi-product plant?
Per day, 1,132 hours of direct labor are needed. Each employee will work 8 hours;
therefore,

1,132 hours
----------------------- = 141.5 employees.
8 hours/employee

• We will hire 142 employees, and management will be evaluated on the performance of
these 142 employees. Without time standards, how many employees would you hire?
Gantt Chart
• A Gantt chart is a project management tool that illustrates a project
plan.
• It typically includes two sections: the left side outlines a list of tasks,
while the right side has a timeline with schedule bars that visualize
work.
• The Gantt chart can also include the start and end dates of tasks,
milestones, dependencies between tasks, and assignees.
• To keep up with the demands of modern software development,
roadmap tools like Jira Software include features like a collapsible
task structure and resource management panels.
Gilbreth Time and Motion Study Film

• https://youtu.be/glNCUmHgp6A
• https://youtu.be/6tQX_E1xZhE

• https://youtu.be/ghIyHLSNqx0

• https://youtu.be/fUXdrl9ch_Q
Max Weber’s bureaucracy Approach
• Max Weber, a German scientist, defines bureaucracy as a highly
structured, formalized, and also an impersonal organization.
• He also instituted the belief that an organization must have a defined
hierarchical structure and clear rules, regulations, and lines of
authority which govern it.
• Max Weber bureaucracy ideally has the following characteristics:
• Specialization of labor
• A formal set of rules and regulations
• Well-defined hierarchy within the organization
• Impersonality in the application of rules
Hawthorne Experiments
 INTRODUCTION

The Hawthorne studies were conducted in

order to find out the role of human resource in
increasing the production of an organization.

The Hawthorne studies included the following

experiments..
Experiments Conducted
• Illumination Experiment
• Relay Assembly Test Experiments
• Plant/mass Interview Group
• Bank Wiring Observation Group
 HAWTHORNE EXPERIMENT

Conducted between 1924-1932

Conducted at WESTERN ELECTRIC

COMPANY, Chicago, USA

Conducted by,
 Elton Mayo
White Head
Roethlisberger
 George Elton Mayo
He was an Australian Psychologist, Sociologist
and Organization Theorist.

Lectured at University of Queensland before

moving to the University of Pennsylvania

Spent most of his career at Harvard Business

School and was the Professor of Industrial
Research

Known as the founder of Human Relations

Movement

Also known for his research including

George Elton Mayo
Airplane View of Hawthorne Works.
Magnetic Wire Insulating Department
Western Electric Company
 Hawthorne Experiment

The Hawthorne experiment were first conducted in

November, 1924 at Western Electric Company’s Hawthorne
plant in Chicago

The initial tests were sponsored by The National Research

Council (NRC) of the National Academy of Sciences

In 1927, a research team from Harvard Business School

was invited to join the studies after the illumination test drew
unanticipated results

A team of researchers led by George Elton Mayo from the

Harvard Business School carried out the studies
(General Electric originally contributed funding, but they
withdrew after the first trial was completed)
Illumination Studies
• 1924-1927
• Funded by General Electric
• Conducted by The National Research Council (NRC)
of the National Academy of Sciences with engineers
from MIT
• Measured Light Intensity vs. Worker Output
• Result :
• Higher worker productivity and satisfaction at all light
levels
• Worker productivity was stopped with the light levels
reached moonlight intensity.
• Conclusions:
• Light intensity has no conclusive effect on output
• Productivity has a psychological component
• Concept of “Hawthorne Effect” was created
Relay Assembly Test Experiments
• 1927-1929
• Experiments were conducted by Elton Mayo

• Manipulated factors of production to measure effect on output:

– Pay Incentives (Each Girls pay was based on the other 5 in the group)
– Length of Work Day & Work Week (5pm, 4:30 pm, 4pm)
– Use of Rest Periods (Two 5 minutes break)
– Company Sponsored Meals (Morning Coffee & soup along with sandwich)

• Results:
– Higher output and greater employee satisfaction
• Conclusions:
– Positive effects even with negative influences – workers’ output will increase as a
response to attention
– Strong social bonds were created within the test group. Workers are influenced by
need for recognition, security and sense of belonging
Mass Interview Program
• Conducted 20,000 interviews.

• Objective was to explore information, which could be used to improve

supervisory training.

• Initially used the method of Direct Questioning and changed to Non

Directive.
• Results
- Giving an opportunity to talk and express grievances would
increase the morale.
- Complaints were symptoms of deep-rooted disturbances.
-Workers are governed by experience obtained from both inside and
outside the company.
Mass Interview Program (Contd)
- The workers were satisfied or dissatisfied depending upon how they regarded
their social status in the company.

- Social groups created big impact on work.

- Production was restricted by workers regardless all financial incentives offered

as group pressure are on individual workers.
Bank Wiring Observation Group
• 1931-1932
• Limited changes to work conditions
• Segregated work area
• No Management Visits
• Supervision would remain the same
• Observer would record data only – no interaction with workers
• Small group pay incentive
• Result:
• No appreciable changes in output

• Conclusions:
• Preexisting performance norms
• Group dictated production standards –
• Work Group protection from management changes.
 CONCLUSION
•The Hawthorne studies have had a remarkable impact on
management in organizations and how workers react to various
situations.

•The research carried out at the Western Electrics Hawthorne plant

during the 1920’s and early 1930’s helped to initiate a whole new
approach to human behaviour studies.

•The final result was “the organization of teamwork-that is, of

sustained cooperation leads to success”.
Quantitative Approach of Management
• During World War II, mathematicians, physicists, and other scientists
joined together to solve military problems.
• The quantitative school of management is a result of the research
conducted during World War II.
• The quantitative approach to management involves the use of
quantitative techniques, such as statistics, information models, and
computer simulations, to improve decision making.
• https://youtu.be/PFuWH4049uk
Systems management theory
• The systems management theory has had a significant effect on
management science. A system is an interrelated set of elements
functioning as a whole. An organization as a system is composed of
four elements:
• Inputs — material or human resources
• Transformation processes — technological and managerial processes
• Outputs — products or services
• Feedback — reactions from the environment
• https://youtu.be/2cYncmhKLUc
Types of System
• An organization that interacts little with its external environment (outside
environment) and therefore receives little feedback from it is called a closed
system.
•
An open system, in contrast, interacts continually with its environment.
Therefore, it is well informed about changes within its surroundings and its
position relative to these changes.
• A subsystem is any system that is part of a larger one.
• Entropy is the tendency of systems to deteriorate or break down over time.
• Synergy is the ability of the whole system to equal more than the sum of its
parts.
Contingency Approach to Management
• The contingency school of management can be summarized as an “it all
depends” approach.
• The appropriate management actions and approaches depend on the situation.
• Managers with a contingency view use a flexible approach, draw on a variety of
theories and experiences, and evaluate many options as they solve problems.
• Contingency management recognizes that there is no one best way to manage.
• In the contingency perspective, managers are faced with the task of determining
which managerial approach is likely to be most effective in a given situation.
• For example, the approach used to manage a group of teenagers
working in a fast‐food restaurant would be very different from the
approach used to manage a medical research team trying to find a
cure for a disease.
• Contingency thinking avoids the classical “one best way” arguments
and recognizes the need to understand situational differences and
respond appropriately to them.
• It does not apply certain management principles to any situation.
• The contingency approach is highly dependent on the experience and
judgment of the manager in a given organizational environment.
• https://youtu.be/WBx8MqDw3eY