UNIT 1: INTRODUCTION TO MANAGEMENT

JIVETA CHAUDHARY GROVER PH: 9999-023-045

OUTLINE
 Managing and Managers
 Organizations and Need for Management
 Management Process
 Types of Managers
 Management Levels and Skills

 The Evolution of Management Theory

 Organizational Environment
 Direct Action Environment
 Indirect Action Environment
 Natural Environment.

 CSR

 Culture and Multiculturalism

 Globalization-Meaning
 Culture
 Corporate Culture
 Culture to Multiculturalism
 Multiculturalism and Organizational Success.
Organizations and Need for Management
Management Process
Types of Managers
Management Levels and Skills
MANAGING AND MANAGERS
ORGANIZATIONS AND NEED FOR MANAGEMENT

 Organization
 Two / more people who work together in a structured way to achieve a specific goal or set of goals
 Open systems that contribute to the world – economy, ecology, socio-cultural, etc.

 Goal
 The purpose that an organization strives to achieve; organizations often have more than one goal; goals are fundamental elements of
organization
 Management
 Process of planning, organizing, leading and controlling the work of organization members and of using available organizational
resources to reach stated organizational goals.
 Manager
 People responsible for directing the effort aimed at helping organizations achieve their goals
 TIP : Managers appeal to employees’ psychology and influence their attitudes example organizational commitment, job
involvement, organizational citizenship behaviour, etc.
PERFORMANCE

Managerial Performance Organizational Performance

 Measure of how efficient and effective a manager is –  Measure of how efficient and effective an
how well he or she determines and achieves organization is – how well he or she determines and
appropriate objectives achieves appropriate objectives

Actual measures of performance are performance outcomes. Right outcomes that are generated for
stakeholders using available resources judiciously.

Managerial Performance and Organizational Performance are intertwined.

Outcomes are generated and contributions are made at following levels: -

1. Individual, Group and Organizational Levels
2. Internal and External Levels
3. National and Global Levels
EFFICIENCY VS EFFECTIVENESS

Efficiency Effectiveness

 The ability to minimize the use of resources in  The ability to determine appropriate objectives
achieving organizational objectives  Doing the right things
 Doing things right

 An input-output concept

 Efficient managers – minimize resource cost in

attaining goals

No amount of efficiency can make up for a lack of effectiveness.

MANAGEMENT PROCESS

Managers make sure an

organization is moving toward
Planning Managers use logic and methods to
think through goals and actions
organizational objectives

Controlling Organizing

Managers direct, influence, and Managers arrange and allocate

motivate employees to perform work, authority, and resources to
essential tasks
Leading achieve organizational goals
  Characteristics / Contributions
 Studies experience through cases
 Identifies successes and failure

 Limitations
MANAGEMENT
APPROACHES  Situations are all different. No attempt to identify principles.
Limited value for developing management theory
EMPIRICAL OR CASE-BASED
APPROACH

Case Situation

Success Failure

WHY?
  Characteristics / Contributions
 Focus on interpersonal behaviour, human relations, leadership
and motivation.
 Based on individual psychologyLimitations

 Limitations
MANAGEMENT
 Ignores planning, organizing and controlling.
APPROACHES
 Psychological training is not enough to become an effective
INTERPERSONAL
manager.
BEHAVIOUR APPROACH

Focus of study
  Characteristics / Contributions
 Emphasis on behaviour of people in groups. Based on
sociology and social psychology. Primarily study of group
behaviour patterns. The study of large groups is often called
"organization behaviour".
 Limitations
MANAGEMENT
 Of ten not integrated with management concepts, principles,
APPROACHES
theory, and techniques. Need for closer integration with
organization structure design, staffing, planning and
GROUP BEHAVIOUR controlling.
APPROACH

Study of Groups

Study of Groups
interacting with
each other
  Characteristics / Contributions
 Concerned with both interpersonal and group behavioural
aspects leading to a system co-operation. Expanded concept
includes any cooperative group with dear purpose
 Limitations
MANAGEMENT
 Too broad a field for the study of management. At the same
APPROACHES
time, it overlooks many managerial concepts, principles, and
techniques.
COOPERATIVE SOCIAL
SYSTEMS APPROACH

tur al
u c i on
e
Str izat
n
ga
Common Goals
Or
  Characteristics / Contributions
 Technical system has great effect on social system (personal
attitudes, group behaviour). Focus on production, office
operations, and other areas with dose relationships between the
technical system and people
MANAGEMENT  Limitations
APPROACHES  Emphasis only on blue-collar and lower-level office work.
Ignores much of other managerial knowledge.
SOCIO TECHNICAL SYSTEM
APPROACH

Social Technical
System System
  Characteristics / Contributions
 Focus on the making of decisions, persons or groups making
decisions, and the decision-making process. Some theorists use
decision making as a springboard to study all enterprise
activities.
MANAGEMENT  Limitations
APPROACHES  There is more to managing than making decisions. The focus is
at the same time too narrow and too wide.
DECISION THEORY
APPROACH
  Characteristics / Contributions
 Systems concepts have broad applicability. Systems have
boundaries, but they also interact with the external environment,
i.e., organizations are open systems. Recognizes importance of
studying interrelatedness of planning, organizing, and controlling
in an organization as well as the many subsystems
MANAGEMENT  Limitations
APPROACHES  Analyses of the interrelatedness of systems and subsystems as well
as the interactions of organisations with their external environment.
SYSTEMS APPROACH Can hardly be considered a new approach to management.
 Reenergizing the System

Resources
Human Planning Staffing Controlling
Capital
Managerial OUTPUTS
Technological, etc
Managerial Knowledge
Products
Management Process Productivity
Goals of Claimants Profitability
(Employees, Employment
shareholders,
CSR, etc.
consumers,
government, suppliers, Organizing Directing
partners, public, etc.)

Communication – Facilitates management by linking the

organization and its various parts plus linking the organization
with its external environment

External Environment
Opportunities and Threats
Resources and Constraints
  Characteristics / Contributions
 Managerial practice depends on circumstances (Le.
contingency or situation). Contingency theory recognizes the
influence of given solutions on organizational behaviour
patterns

MANAGEMENT  Limitations
APPROACHES  Managers have long realised that there is no one best way to
do things. Difficulty in determining all relevant contingency
CONTINGENCY APPROACH factors and showing their relationships. Can be very complex
  Characteristics / Contributions
 Original study consisted of observations of five chief
executives. On the basis of this study, ten managerial roles
were identified and grouped into O) interpersonal, (2)
informational and (37 decision roles.
 Limitations
MANAGEMENT
 Original sample was very small. Same activities are not
APPROACHES
managerial. Activities are evidence of planning, organising,
staffing, leading and controlling. But same important
MANAGERIAL ROLES managerial activities were left out (e.g., appraising managers).
APPROACH
HENRY MINTZBERG
Interpersonal Role Informational Role Decisional Role

Figurehead Monitor Entrepreneur

Leader Disseminator Disturbance handler

Liaison Spokesperson Resource allocator

Negotiator
 Eight Managerial Job Types

Managerial Job Types Key Roles

MANAGEMENT
APPROACHES Contact Man Liaison, Figure head

MANAGERIAL ROLES Political Manager Spokesman, Negotiator

APPROACH
HENRY MINTZBERG Entrepreneur Entrepreneur, Negotiator
CONTD.
Insider Resource Allocator

Real – time Manager Disturbance Handler

Team Manager Leader

Expert Manager Monitor, Spokesman

New Manager Liaison, Monitor

MANAGEMENT
APPROACHES

McKinsey’s 7 S Framework
MANAGER TYPES

Levels Functions

First line Functional

managers managers

Middle General
managers managers

Top
managers
MANAGEMENT LEVELS AND SKILLS

Relative Skills Needed for Effective Performance at Different Levels of Management

Top Management CONCEPTUAL

Middle Management HUMAN

First-Line Management TECHNICAL

CONCEPTUAL SKILLS
 Conceptual thinking, according to Buffalo State College, is the "[a]bility
to identify patterns or connections between situations that are not
obviously related, and to identify key or underlying issues in complex
situations." For an organization to be successful in a globally
competitive and complex environment, organizations must hire
managers with the intellectual ability to visualize what may not be
apparent, then delegate to supervisors the task of strategy execution.
 Conceptual skills revolve around generating ideas through creative
intuitions and a comprehensive understanding of a given context.
 Conceptual skills primarily revolve around generating ideas, utilizing a
combination of creative intuitions and a comprehensive understanding
of a given context (i.e., incumbent ‘s industry, organizational mission
and objectives, competitive dynamics, etc.). When combined with a
variety of information, as well as a degree of creativity, conceptual
thinking results in new ideas, unique strategies, and differentiation.
 Conceptual skills enable one to generate ideas creatively and intuitively
and also show comprehensive understanding of contexts or topics.
Conceptual skills tend to be most relevant to upper-level thinking and
broad strategic situations (as opposed to lower-level and line
management). As a result, conceptual skills are often viewed as critical
success factors for upper-managerial functions.
  Conceptual skills are important in empowering leaders in all levels of
an organization to observe the operations of an organization and frame
them conceptually as an aspect of that organization’s strategy,
objectives, and policies.
 DEVLOPING CONCEPTUAL SKILLS

 Observation: Closely observe leaders on how they analyze any situation and take actions. What factors have
they considered while taking decisions? Analyze outcome of their actions.
 Identify problems within the organization and treat them as case studies. Study the situation and have
solutions for them. Discuss them with people to get different perspective.
 Attend seminars/ training on business management and network with people from within and outside
industry. Discuss their business scenarios to gain better understanding
 Read about successful businesses / new technology & processes and how they will affect future business
 Discuss ideas with people. It helps to fill in the gaps of our own thinking and come out with new ideas
 Find a mentor - a person with more experience to discuss ideas
 Simple tools such as drawings, flowcharts, mind maps etc. guide thinking and assist in conceptual thinking.
 Volunteer for cross functional assignments or job rotations to get exposure of different functions within an
organization
 CONCEPTUAL SKILLS - TYPES

Analysis
Defining strategies for reaching Communication Creative Thinking Leadership Problem Solving
goals
Diagnosing problems within the
Active listening Abstract thinking Commitment to Breaking down a project
company
Effectively Creative thinking achieving company into manageable pieces
Forecasting for the business or goals
communicating strategy Examining complex Decision making
department
and vision issues Delegation Executing solutions
Questioning the connection
Conviction Formulating ideas Leadership Formulating effective
between new initiatives and the
strategic plan Ability to instil trust via Formulating processes Management courses of action
words Motivation Logical thinking
Recognizing opportunities for Innovation
improvement Intuitive thinking Persuasiveness Multitasking
Seeing the key elements in any Openmindedness Stability Prioritization
situation Strategic planning Resolving industry
Organization
Selecting important information Task direction problems
from large data sets
Task implementation
Understanding relationships
between departments Team building
Understanding relationships Vision
between ideas, concepts, and Visualizing the company
patterns as a whole
Understanding the organization’s Resilient management
business model
HUMAN SKILLS

 The development of human skills— a combination of social, interpersonal, and leadership skills
—is central to the success of any manager.
 human skill is the executive’s ability to work effectively as a group member and to build
cooperative effort within the team he leads. As technical skill is primarily concerned with
working with “things” (processes or physical objects), so human skill is primarily concerned
with working with people. This skill is demonstrated in the way the individual perceives (and
recognizes the perceptions of) his superiors, equals, and subordinates, and in the way he behaves
subsequently.
 The person with highly developed human skill is aware of his own attitudes, assumptions, and
beliefs about other individuals and groups; he is able to see the usefulness and limitations of
these feelings. By accepting the existence of viewpoints, perceptions, and beliefs which are
different from his own, he is skilled in understanding what others really mean by their words
and behavior. He is equally skillful in communicating to others, in their own contexts, what he
means by his behavior.
HUMAN SKILLS

 Such a person works to create an atmosphere of approval and security in which subordinates feel free
to express themselves without fear of censure or ridicule, by encouraging them to participate in the
planning and carrying out of those things which directly affect them. He is sufficiently sensitive to the
needs and motivations of others in his organization so that he can judge the possible reactions to, and
outcomes of, various courses of action he may undertake. Having this sensitivity, he is able and
willing to act in a way which takes these perceptions by others into account.
 Real skill in working with others must become a natural, continuous activity, since it involves
sensitivity not only at times of decision making but also in the day-by-day behavior of the individual.
Human skill cannot be a “sometime thing.” Techniques cannot be randomly applied, nor can
personality traits be put on or removed like an overcoat. Because everything which an executive says
and does (or leaves unsaid or undone) has an effect on his associates, his true self will, in time, show
through. Thus, to be effective, this skill must be naturally developed and unconsciously, as well as
consistently, demonstrated in the individual’s every action. It must become an integral part of his
whole being.
  The ability to relate to others
 Strong communication skills
 Patience with others
 The ability to trust others
 Knowing how and when to show empathy
 Active listening skills
 Genuine interest in others
 Flexibility
 Good judgment
PEOPLE  The ability to persuade others
SKILLS -  Negotiation skills
FORBES 2013  The ability to keep an open mind
 A great sense of humor
 Knowing your audience
 Honesty
 Awareness of body language
 The ability to be supportive and motivate others
 Good manners
 Leadership skills
 Proactive problem solving
TECHNICAL SKILLS

 Technical skill implies an understanding of, and proficiency in, a specific kind of activity, particularly
one involving methods, processes, procedures, or techniques. It is relatively easy for us to visualize
the technical skill of the surgeon, the musician, the accountant, or the engineer when each is
performing his own special function. Technical skill involves specialized knowledge, analytical ability
within that specialty, and facility in the use of the tools and techniques of the specific discipline.
 Leaders also need a broad range of technical know-how. All industries need management, and
management must exist at various organizational levels. A technical skill for a leader might include a
working understanding of a piece of equipment: the ability to coach the employee on its operation, as
well as communicate to people the basic functions of the machinery.
 Leaders in other corporate roles and at higher levels require critical technical skills. These can include
office-based competencies such as typing, programming, website maintenance, writing, giving
presentations, and using software such as Microsoft Office or Adobe. Office environments require a
complex set of communicative, technological, and data-organization skills in order to optimize
managerial performance.
 MANAGEMENT LEVELS AND FUNCTIONS

Top-
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ch

level
ar

man
er
Hi

ager

Controlling
Organizing
Planning
l
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Leading
Middle-level
tio

managers
a
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ga
Or

First-level supervisors
MANAGEMENT CHALLENGES
IN TODAY’S BUSINESS WORLD - VUCA
VOLATILE UNCERTAIN COMPLEX AMBIGUOUS

Management / Organizational Challenges

Research,
Marketing &
HRM Finance Operations Quality & IT
Selling
Innovation
EVENTS PRIOR TO THE INDUSTRIAL REVOLUTION
FREDERICK TAYLOR AND SCIENTIFIC MANAGEMEN
HENRY FAYOL AND THE GENERAL MANAGEMENT THEORY
MAX WEBER AND THE BUREAUCRACY THEORY
ELTON MAYO AND THE HUMAN RELATIONS MOVEMENT
RENSIS LIKERT (AND OTHERS) AND THE NEO-HUMAN RELATIONS APPROACH
KENNETH BOULDING AND THE SYSTEMS APPROACH
PAUL LAWRENCE, JAY LORSCH AND THE CONTINGENCY APPROACH
RECENT ORGANISATIONAL THEORIES

EVOLUTION OF MANAGEMENT THOUGHT

EVENTS PRIOR TO INDUSTRIAL REVOLUTION

 400 BC – 1900 AD – Families and Communities

 Notions about leadership, management and the design of organisations are, in fact, as old as mankind
 Niccolo Machiavelli (1469–1527)
 In his book, The Prince, provides guidelines for leaders and rulers
 Promoted preservation and expansion of power
 Extremely opportunistic
 Taking advantage of situation
 Pure self interest
 Possession of bullion (gold and money) is the only measure of nation’s wealth (mercantilism)
 Adam Smith (1723-1790)
 Wrote the book, An Inquiry into the Nature and Causes of the Wealth of Nations.
 Productive work is the source of prosperity and effective division of labour can raise levels of productivity
 Rejected the principles of mercantilism
 Systematic approach to management
 Attention paid to efficiency
EVENTS PRIOR TO INDUSTRIAL REVOLUTION

 In the fifteenth century, Johannes Gutenberg (1400–1468) developed the first metallic movable type for a
printing press and opened the door to an information revolution that continues today (Great Britain)
 Great Britain’s largest industry of this time was textiles. From the colonies came the cotton, wool, and other
fibers to be cleaned, combed, spun, and so on into cloth. Mechanical improvements in the textile industry
preceded the Industrial Revolution.
 18th century – steam engine – heart of industrial revolution
 Made mass production in large factories possible and replaced manufacture of products in workers’
homes or in small workplaces.
 Worker movement / migration started
 Industrial revolution began with the steam engine (Began in England and after 1840 spread to Western
Europe and US)
 Low may and miserable working conditions
EVENTS PRIOR TO INDUSTRIAL REVOLUTION

 End of 19th century

 American companies grew dramatically
 Features of organization: -
 Division of responsibility between supervisors and staff was unclear
 Production standards and wages were determined subjectively
 Unpredictability
 Hardly any planning
 Managers used hard methods and pushed workers to produce as much as possible
 Workers reacted by soldiering (stretching out their time)
 Frederick Winslow Taylor (1856–1915) saw this and decided to do something about it
FREDERICK TAYLOR AND SCIENTIFIC MANAGEMEN

 + 1900

 Frederick Taylor was the first to suggest a systematic, coherent approach to organize factories
 Manager to focus on planning, coordinating and overseeing, and checking of results
 Key elements: -
 Scientific analysis of the activities that should be carried out and the time and motion studies to be used

Result: standardization
 Clear division of tasks and training for the workforce

Result: production improvement

 Close and friendly working relationships between managers and workers
 Managers being held responsible for seeking and analysing appropriate working methods and for creating
optimum conditions for production
 Use of careful selection processes to obtain the best person for the job
 Financial rewards being given for following prescribed methods in order to reduce production costs
FREDERICK TAYLOR AND SCIENTIFIC MANAGEMEN

 Divided front line supervisory responsibilities into eight areas to be handled individually by a particular
person
1. Time and costing
2. Task instructions
3. Order of work
4. Work preparation and allocation
5. Maintenance
6. Quality control
7. Technical guidance
8. Personnel management
  Midvale Steel Company
 Observed ‘Soldiering’ – Natural & Systematic
 Identified reasons for Soldiering
 Lay off
 Cut of piece rate
 Rule of thumb method
 Asked labor to produce more; Cut piece rate; Imposed fines –
resulted in failure
 Saw that a business is a system of human cooperation that will be
FREDERICK successful only if all concerned work toward a common goal
TAYLOR AND  Realized that a new industrial system was essential for preventing
SCIENTIFIC such bitter labour–management encounters
 Labour–management conflict was due to ignorance on both sides.
MANAGEMEN  Management expected and workers were ready to provide ‘‘a fair
day’s work’’ for ‘‘a fair day’s pay.’’ Neither side, however, knew
what constituted a day’s work
 Time study
 What is + What was possible
 Two phases – Analysis & Synthesis
 Improved Incentives
 Differential piece rate
 Disapproved profit sharing
FREDERICK TAYLOR AND SCIENTIFIC MANAGEMEN

 Defined management as ‘‘knowing exactly what you want men to do, and then seeing that they do it
in the best and cheapest way....the relations between employers and men form without question the
most important part of this art.”
 No system of management, however good, should be applied in a wooden way. The proper personal
relations should always be maintained between the employers and men; and even the prejudices of
the workmen should be considered in dealing with them.
 The employer who goes through his works with kid gloves on, and is never known to dirty his hands
or clothes, and who either talks to his men in a condescending or patronizing way, or else not at all,
has no chance whatever of ascertaining their real thoughts or feelings.
 Above all it is desirable that men should be talked to on their own level by those who are over them.
Each man should be encouraged to discuss any trouble which he may have, either in the works or
outside, with those over him.
 The opportunity which each man should have of airing his mind freely, and having it out with his
employers, is a safety-valve; and if the superintendents are reasonable men, and listen to and treat
with respect what their men have to say, there is absolutely no reason for labour unions and strikes
HENRY FAYOL AND THE GENERAL MANAGEMENT THEORY

 + 1900
 Different from Taylor – Taylor
focused industry/manufacturing
companies, Fayol focused
management in general
 Gave the 14 Principles of
Management
 For him, Unity of Command was the
most important
 Gave the five elements of management (Planning,
Organizing, Commanding, Coordinating and
Controlling)

Held that managers should have a thorough

knowledge of their employees; Set a good
HENRY FAYOL example for others; Strive at making unity,
AND THE energy, initiative, and loyalty prevail among all
employees
GENERAL
MANAGEMENT
THEORY
Communication skills were crucial

In diary entry dated July 29, 1898, Fayol wrote:

‘In business administration, the question of
[managing] people represents more than one-half
of the problem.’
 MAX WEBER AND THE BUREAUCRACY THEORY

 + 1940
 Studied government organizations and large businesses from a sociological perspective
 Large organizations should have the following characteristics: -
 Clear and definite division of tasks
 A hierarchical command structure
 Carefully defined authority and responsibilities
 Impersonal relations between officials (position is more important than the person)
 Recruitment on the basis of ability and knowledge instead of contacts
 Promotion and reward on the basis of objective criteria and procedures
 The execution of activities according to clearly laid down procedures
 All information, procedures and details written down, so that full control of every aspect is possible
 The power of officials, even the most senior executives, bound by documented guidelines
 Ideal bureaucracy – if all above are met with
 Weber’s definition is separate from the subsequent negative connotations that the word bureaucracy has gained
 highlighted some of the less effective, negative characteristics such as inflexibility and the lack of initiative and
creativity
 Saw bureaucracy as a perfect means of reaching management targets
ELTON MAYO AND THE HUMAN RELATIONS MOVEMENT
 + 1945
 Hawthorne Studies
 Original intent - to investigate the relationship between variations in workplace lighting and employee
productivity.
 Hypothesized that as workplace illumination was increased, employee productivity would increase
 Illumination Study (1924 -27)
 Result – no simple cause and effect relation b/w lighting and productivity
ELTON MAYO AND THE HUMAN RELATIONS MOVEMENT

 Hawthorne Studies
 Relay Assembly Test Room Study (1927-32)
 To determine the effects of working conditions, such as rest breaks, workday length, company-provided
midmorning lunches, and method of payment, on employee productivity
 Assemblers in the test room were producing more.
 Reasons cited were first, ‘‘it was fun’’ working in the test room. They enjoyed being the centre of attention
and second, the new supervisory style, or more accurately, the absence of the old supervisory style, allowed
them to work freely without anxiety
 Bank Wiring Observation Room (1931-32)
 Opposite results
 Output restricted by workers
 Elton Mayo: -
 Human collaboration in work, in primitive and developed societies, has always depended for its
perpetuation upon the evolution of a non-logical social code which regulates the relations between persons
and their attitudes to one another. Insistence upon a merely economic logic of production . . . interferes with
the development of such a code and consequently gives rise in the group to a sense of human defeat. This
human defeat results in the formation of a social code at a lower level and in opposition to the economic
logic. One of its symptoms is ‘‘restriction.’’
  Result of Hawthorne Studies

ELTON MAYO  Workers are not motivated solely by

money.
AND THE  Personal and social factors important
in motivation and employee attitudes
HUMAN toward every aspect of their work
 Importance of individual attitudes in
RELATIONS determining employee behaviour
became undeniable.
MOVEMENT  Significance of effective supervision
in maintaining employee job
satisfaction and productivity became
indisputable.
 It became evident that little was
known about the character of
informal work groups and their
influence on employee performance.
  + 1950
 Warren G. Bennis
 The Taylor approach leads to ‘an organisation without
men’ and the human relations movement generates
RENSIS LIKERT ‘groups of men without organisation’
 Emphasized need for revision of human relations
(AND OTHERS) approach
AND THE NEO-  Other writers

HUMAN  Likert, Herzberg, McGregor, Burn and Mouton

RELATIONS  Cheter Barnard – acceptance theory of leadership

 Rensis Likert (1903–1981)
APPROACH  Linking pin model - a structure containing a number
(BEHAVIOURAL of overlapping groups in which members of one unit
are leaders of another, meaning that the leader of one
SCIENCE group is also a member of a higher group. This person
APPROACH) not only leads one group but also ensures that there is
effective communication with the higher group.
 Fredrick Herzberg – two factor theory
 Abraham Maslow – need hierarchy
 Douglas McGregor – theory x and y
 + 1950
 Organizations are systems - a whole made up of
coherent parts
 All activities closely related + organizations exist
in environment KENNETH
 A system (an organisation) consists of a number of
BOULDING
subsystems (divisions) ostensibly connected with
each other. When the total result of all subsystems AND THE
working together is greater than the sum of their SYSTEMS
individual results, this is synergy. A system
(organisation) is run with the help of information
APPROACH
that is given (feedback) to the various subsystems
(divisions).
 Management should tackle organisational
problems in a consistent way
KENNETH
BOULDING
AND THE
SYSTEMS
APPROACH
 + 1965

‘contingency’ = ‘determination by situation’

PAUL
LAWRENCE, JAY
LORSCH AND To obtain optimal performance, different circumstances
THE will require different structures, task divisions, and
CONTINGENCY working methods

APPROACH
Choice of management technique is strongly influenced
by the circumstances in which an organisation finds itself

Organisations must have a clear focus on their

surroundings
RECENT ORGANISATIONAL THEORIES (1980+)

Henry Mintzberg and Tom Peters and Peter Drucker (1909–

Philip Crosby and
organisational structure management principles 2005 ) and general
quality control
and strategic planning for excellent companies management

Michael Hammer and re- Jim Collins and

Michael Porter and C.K. Prahalad (1941–
engineering of business corporate culture and
strategy 2010) and competition
processes leadership

Kjell Nordström and

Jonas Ridderstråle (b. Don Tapscott and Steve Jobs (1955–2011):
1966) and changing Wikinomics visionary of simplicity
businesses
Direct Action Environment
Indirect Action Environment
Natural Environment
ORGANIZATIONAL ENVIRONMENT
ORGANIZATIONAL ENVIRONMENT
Social Variables Technological Variables
(New developments in products / processes and advances in
(Demographics, Lifestyle and Social Values)
science. Disruptive Innovations)

Competitors Customers Suppliers

Employees
Financial The Organization Labour Unions
Institutions
Shareholders and the Board of Directors

The Media Special – Interest Groups Government

Economic Variables Political Variables

(Economics trends & policies; fiscal policy; investments; (Government policies, International Political Affairs)
international transactions)

Internal Stakeholders – The Direct Action Environment + NATURAL Environment

(Internal Environment of the Organization) - Sustainable Development
External Stakeholders – The Direct Action Environment - Green Organizations
(Immediate / Micro) External Environment of the Organization)
The Indirect Action Environment
(Remote / Macro) External Environment of the Organization)
CSR
CORPORATE SOCIAL RESPONSIVENESS

 Corporate social responsiveness refers to how business organizations and their agents actively interact with and manage
their environments.
 In contrast, corporate social responsibility accentuates the moral obligations that business has to society.

 Responsiveness and responsibility can be viewed as a balance in that responsiveness can be shaped or triggered by public
expectations of business responsibilities.
Globalization-Meaning
Culture
Corporate Culture
Culture to Multiculturalism
Multiculturalism and Organizational Success
CULTURE AND MULTICULTURALISM
CULTURE DEFINED

 Culture consists of patterns, explicit and implicit, of and for behavior acquired and transmitted by symbols, constituting
the distinctive achievement of human groups, including their embodiment in artifacts
 Culture consists of totality of assumptions, beliefs, values, social systems and institutions, physical artifacts and
behaviour of people, reflecting their desire to maintain continuity as well as to adapt to external demands
 Work culture, on the other hand, is a totality of various levels of interaction among organisational factors (boundaries,
goals, objectives, technology, managerial practices, material and human resources, and the constraints) and organismic
factors (skills, knowledge, needs, and expectations) interact among themselves at various levels. Over a period of time
they develop roles, norms and values focusing work and is called work culture
ORGANIZATIONAL CULTURE DEFINED

 Organizational or corporate culture is the pattern of values, norms, beliefs, attitudes and assumptions that may not have
been articulated but shape the ways in which people in organizations behave and things get done. ‘Values’ refer to what is
believed to be important about how people and organizations behave. ‘Norms’ are the unwritten rules of behaviour.
 Some more definitions: -
 The culture of an organization refers to the unique configuration of norms, values, beliefs and ways of behaving that characterize
the manner in which groups and individuals combine to get things done. Eldridge and Crombie (1974)
 Culture is a system of informal rules that spells out how people are to behave most of the time. Deal and Kennedy (1982)
 A pattern of basic assumptions – invented, discovered or developed by a given group as it learns to cope with the problems of
external adaptation and internal integration – that has worked well enough to be considered valid and, therefore, to be taught to new
members as the correct way to perceive, think and feel in relation to these problems. Schein (1985)
 Culture is the commonly held beliefs, attitudes and values that exist in an organization. Put more simply, culture is ‘the way we do
things around here’. Furnham and Gunter (1993)
ORGANIZATION  It is difficult to define (often a
pointless exercise)
CULTURE  It is multi-dimensional, with many
CHARACTERISTIC different components at different
levels
S  It is not particularly dynamic and
ever-changing (being relatively
stable over short periods of time)
 It takes time to establish and
therefore time to change a corporate
culture
 Culture represents the ‘social glue’ and
generates a ‘we-feeling’, thus
counteracting processes of
differentiations that are an unavoidable
part of organizational life. ORGANIZATION
 Organizational culture offers a shared
system of meanings which is the basis for
CULTURE
communications and mutual
understanding. If these functions are not
SIGNIFICANCE
fulfilled in a satisfactory way, culture
may significantly reduce the efficiency of
an organization.
ORGANIZATION CULTURE – HOW IT IS FORMED – 4 WAYS

By the leaders in the organization, especially those who have shaped it in the past. Schein (1990) indicates that
people identify with visionary leaders – how they behave and what they expect. They note what such leaders
pay attention to and treat them as role models.s

Culture is formed around critical incidents – important events from which lessons are learnt about desirable or
undesirable behavior

Culture develops from the need to maintain effective working relationships among organization members, and
this establishes values and expectations.

Culture is influenced by the organization’s environment.

ORGANIZATION CULTURE COMPONENTS

Values Norms

Organization Culture
Components

Artefacts Management Style

  Values are beliefs in what is best or good for the organization
and what should or ought to happen.
 The ‘value set’ of an organization may only be recognized at
top level, or it may be shared throughout the business, in which
case it could be described as ‘value-driven’.
 The stronger the values the more they will influence behaviour.
ORGANIZATION
CULTURE  This does not depend upon their having been articulated.
COMPONENTS  Implicit values that are deeply embedded in the culture of an

VALUES organization and are reinforced by the behaviour of

management can be highly influential, while espoused values
that are idealistic and are not reflected in managerial behaviour
may have little or no effect.
 When values are acted on they are called ‘values in use’

 Values are translated into reality through norms and artefacts

 They may also be expressed through the media of language

(organizational jargon), rituals, stories and myths
ORGANIZATION CULTURE COMPONENTS
VALUES
  Norms are the unwritten rules of behaviour, the ‘rules of the
game’ that provide informal guidelines on how to behave.
ORGANIZATION  Norms tell people what they are supposed to be doing, saying,
CULTURE believing, even wearing. They are never expressed in writing –
COMPONENTS if they were, they would be policies or procedures.

NORMS  They are passed on by word of mouth or behaviour and can be

enforced by the reactions of people if they are violated.
 They can exert very powerful pressure on behaviour because of
these reactions – we control others by the way we react to
them.
ORGANIZATION
CULTURE
COMPONENTS
NORMS
  Artefacts are the visible and tangible aspects of an organization
that people hear, see or feel and which contribute to their
ORGANIZATION understanding of the organization’s culture.
CULTURE  Artefacts can include such things as the working environment,
COMPONENTS the tone and language used in e-mails, letters or memoranda,

ARTEFACTS the manner in which people address each other at meetings, in

e-mails or over the telephone, the welcome (or lack of
welcome) given to visitors and the way in which telephonists
deal with outside calls.
 Artefacts can be very revealing
  Management style is the approach managers use to deal with
people. It is also called ‘leadership style’
ORGANIZATION  It consists of the following extremes:
CULTURE  Charismatic/non-charismatic.
COMPONENTS  Autocratic/democratic.
MANAGEMENT  Enabler/controller.
STYLE  Transactional/transformational.

 A good case can be made for using an appropriate style

according to the situation but it is undesirable to be
inconsistent in the style used in similar situations
ORGANIZATION CLIMATE

 As defined by Ivancevitch et al (2008), organizational climate is: ‘A set of properties of the work environment, perceived
directly or indirectly by the employees, that is assumed to be a major force in infl uencing employee behaviour.’
 The term ‘organizational climate’ is sometimes confused with organizational culture and there has been much debate on
what distinguishes them from one another.
 In his analysis of this issue, Denison (1996) suggested that ‘culture’ refers to the deep structure of organizations, which is
rooted in the values, beliefs and assumptions held by organizational members. In contrast, ‘climate’ refers to those
aspects of the environment that are consciously perceived by organizational members.
 Rousseau (1988) stated that climate is a perception and is descriptive. Perceptions are sensations or realizations
experienced by an individual. Descriptions are what a person reports of these sensations.
MULTICULTURALISM

 ASSIGNMENT

 Poster presentation

 Group Size – 3 to 5

 Topics – Multiculturalism, Multiculturalism Organization Development Model, Multiculturalism and Organization

Success, Multiculturalism – Measures if success
 HINT – Look for Octapace, Hofstede study, inclusive workplace – building & sustaining