The Development History of Business Management Theories

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The Development History of Business Management
Theories
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outline
1?Scientific Management
2?General Administrative Theory
3?Human resources approach
4?System approach, Contingency approach
5?Globalization, diverse workforce, innovation
and change management
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Part 1.Scientific Management
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Frederick Taylor(???????)

• 1? the father of Scientific management.
• 2?The Principles of Scientific management in
  1911.

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Background of That Time

• There were no clear concepts of
  responsibilities to workers and managers.
• No effective work standards existed.
• Management decisions were based on hunch and
  intuition.
• Workers were placed on jobs with little or no
  concern for matching their abilities and
  aptitudes with the tasks required.
• Managers and workers considered themselves to be
  in continual conflictany gain by one would be at
  the expense of the other.

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Scientific management also
called Taylorism
Key words
analyzed and synthesized   labor
productivity
science
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Taylors Four Principles of Management

• Develop a scientific way for each element of an
  individuals work, which replaces the old
  rule-of-thumb method.
• Scientifically select and then train, teach, and
  develop the worker.
• Heartily cooperate with the workers so as to
  ensure that all work is done in accordance with
  the scientific way that has been developed.
• Divide work and responsibility almost equally
  between managers and workers. Managers take over
  all work for which it is better fitted than the
  workers.

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• Today, most of its themes are still
  important parts of industrial engineering and
  management.
• Analysis
• Synthesis
• Logic
• Rationality
• Empiricism
• Work ethic
• Efficiency and elimination of waste
  standardization of best practices

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• How do todays managers use Scientific
  Management?
• Use time and motion studies to increase
  productivity
• Hire the best qualified employees
• Design incentive systems based on output

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• Part2
• General Administrative Theory

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• Herial Fayol
• French executive and engineer
• Herial Fayols contributions
• He stated 14 principles of
  managementfundamental or universal truths.
• 1916 Industrial management and general
  management

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Fayols Administrative Theory

• Five Elements of Management -- Managerial
  Objectives
• Forecasting and planning ?????
• Organizing ??
• Command ??
• Coordination ??
• Control ??
• Keep machine functioning effectively and
  efficiently
• Replace quickly and efficiently any part or
  process that did not contribute to the objectives

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Fayols Administrative Theory

• Fourteen Principles of Management (Tools for
  Accomplishing Objectives)
• Division of work ????
• Authority and Responsibility ?????
• Discipline ??
• Unity of Command ????

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Unity of Direction ???? Remuneration
of Personnel ???? Centralization
?? . Scalar Chain
???
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• Order ??
• Equity ??
• Stability of Tenure of Personnel ????

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• Subordination of Individual Interest to General
  Interest ??????????
• Initiative ????
• Esprit de corps ????

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Webers Theory of Bureaucracy

• Max Weber (1864-1920)
• German Sociologist
• Theory of Social and Economic Organization (1947)
• Principles and Elements of Management - describe
  an ideal or pure form of organizational structure
  (general policy and specific commands
• PRIMARY FOCUS Organizational Structure
• Worker should respect the right of managers to
  direct activities dictated by organizational
  rules and procedures

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Webers Theory of Bureaucracy

• Bureaucracy allows for the optimal form of
  authority - rational authority
• Three types of Legitimate Authority
• Traditional Authority - past customs personal
  loyalty
• Charismatic Authority - personal trust in
  character and skills
• Rational Authority - rational application of
  rules or laws

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Max Weber Max Webers contributions
Weber developed a theory of authority structures
and described organizational activity on the
basis of authority relations. He described an
ideal type of organization that he called a
bureaucracy, characterized by division of labor,
a clearly defined hierarchy, detailed rules and
regulations, and impersonal relationships.
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Webers Ideal Bureaucracy

• Division of labor ????
• Authority hierarchy ????
• Formal selection ?????
• Formal rules and regulation ????????
• Impersonality ????
• Career orientation ??????

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• Part 3
• Human resources approach

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Human resources approach

• Managers get things done by working with people,
  which explains why some writers and researchers
  have chosen to look at management by focusing on
  the organizations human resources. Much of what
  currently makes up the field of personnel or
  human resources management, as well as
  contemporary views on motivation and leadership,
  has come out of the work of theorists we have
  categorized as part of the human resources
  approach to management.

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Look at people as humans rather than
machines Peoples need The
environment( human relations)
Owen
Owen
Owen
Human resources approach(Before 1950s)
Maslow
Get the main ideas
Maslow
Maslow
McGredor
McGredor
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1.Who were some early advocates of the human
resources approach?
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• Undoubtedly, many people in the
  nineteenth and early part of the twentieth
  centuries recognized the importance of the human
  factor to an organizations success, but five
  individuals stand out as early advocates of the
  human resources approach. They are Robert Owen,
  Hugo Munsterberg, Mary Paraker Follett, Chester
  Barnard, and Elton Mayo.

Robert Owen
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The Background of Robert Owen

• Robert Owen was a successful Scottish
  businessman who bought his first factory in 1789
  when he was just 18 years old. Repulsed by the
  harsh practices he saw in factories across
  Scotland such as the employment of young children
  (many under the age of 10), 13 hour work days,
  and miserable working conditions Owen became a
  reformer.

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The Background of Robert Owen

• He chided factory owners for treating
  their equipment better than their employees. He
  said that they would buy the best machines but
  then buy the cheapest labor to run them. Owen
  argued that money spent on improving labor
  conditions was one of the best investments that
  business executive could make. He claimed that a
  concern for employees was highly profitable for
  management and would relieve human misery.

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The status of Owen

• Owen proposed a utopian workplace he is
  not remembered in management history for his
  successes but rather for his courage and
  commitment to reducing the suffering of the
  working class. He was more than a hundred years
  ahead of his time when he argued, ,in 1825 for
  regulated hours of work for all, child labor
  laws, public education, company furnished tools
  and equipment and business involvement in
  community projects.

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2. Maslow's hierarchy of needs

• Maslows hierarchy of
  needs(?????????,??????????) is a theory in
  psychology, proposed by Abraham Maslow in his
  1943 paper "A Theory of Human Motivation".
• .

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• Maslow use the terms Physiological,
  Safety, Belongingness and Love, Esteem, and
  Self-Actualization needs to describe the pattern
  that human motivations generally move through.
• ??????,?????????,????????????????????????
  ????????

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3. Douglas McGregor

• Douglas Murray McGregor (1906) was a
  Management professor at the MIT Sloan School of
  Management and president of Antioch College from
  1948 to 1954.

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His theory

• In the book The Human Side of
  Enterprise (the fourth most influential
  management book of the 20th century in a poll of
  the Fellows of the Academy of Management),
  McGregor identified an approach of creating an
  environment within which employees are motivated
  via authoritative, direction and control or
  integration and self-control, which he called
  theory X and theory Y,respectively. Theory Y is
  the practical application of Dr. Abraham Maslow's
  Humanistic School of Psychology, or Third Force
  psychology, applied to scientific management.

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• Part 4
• System approach, Contingency approach

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System Approach

• Whats the system approach?
• Two basic types of the system
• closed and open
• Closed systems are not influenced by and do not
  interact with their environment.
• In contrast, an open system dynamically interacts
  with its environment.

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Whats the System Approach?

• The system approach defines a system as a set
  of interrelated and interdependent parts arranged
  in a manner that produces a unified whole.
  Societies are systems and so, too, are computers,
  automobiles, organizations, and animal and human
  bodies.

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The definition of Contingency Approach

• An assumption that no one theory or method for
  business management can apply to all businesses
  or to all circumstances.
• From a business perspective, using a contingency
  approach to problem solving would indicate that
  issues need to be understood and then addressed
  in ways that depend on the environment and
  context in which they occur.

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Contingency Approach

• Contingency approach, also known as situational
  approach, is a concept in management stating that
  there is no one universally applicable set of
  management principles (rules) by which to manage
  organizations.

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• A conceptual model of the contingency approach
  was developed by Kieser and Kubicek.

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• According to the model, the formal structure of
  an organization defines the roles of its members
  in a specific way and thereby directs their
  behavior to a certain degree. The performance of
  the organization depends on the degree to which
  these role definitions enable members to cope
  with the requirements resulting from the context
  of the organization.

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• Part 5
• Globalization, diverse workforce, innovation
  and change management

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Globalization

• Forms of globalization (Internationalization)
• Stages of going global
• Understanding different cultures

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Forms of Internationalization

• Multinational Corporations (MNCs)
• Multinational corporations maintain
  significant operations in two or more countries
  simultaneously but are based in one home country
  .
• Transnational Corporations (TNCs)
• Transnational corporations maintain
  significant operations in more than one country
  simultaneously and decentralizes decision making
  in each operation to the local country.
• Borderless Organization
• Borderless organization is a management
  structure in which internal arrangements that
  impose artificial geographic barriers are broken
  down.

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Stages of Going Global
Stage? Passive Response
Stage? Initial Overt Entry
Stage? Established International
Operations
Foreign subsidiary
Joint ventures
Hiring foreign Representation or Contracting
with Foreign manufactures
Exporting to foreign countries
Licensing/ franchising
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Four Dimensions of National Culture

• Individualism versus collectivism
• Power distance
• Uncertainty avoidance
• Quantity versus quality of life

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Continuous Improvements in Quality TQM

• Original idea
• Deming emphasized the use of statistics to
  analyze variability in production processes to
  create uniform quality and predictable quantity
  of output.
• TQM (total quality management)
• TQM is a philosophy of management that is
  driven by customer needs and expectations and
  that is committed to continuous improvement.

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Components of Total Quality Management

• Intense focus on the customer
• Concern for continuous improvement
• Improvement in the quality of everything the
  organization does
• Accurate measurement
• Empowerment of employees

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Diverse workforce

• Religious affiliation
• Age
• Disability status
• Military
• Experience
• Sexual orientation
• Economic class
• Educational level

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Competitive advantages through diverse workforce

• Ability to attract and retain motivated employees
• Better perspective of a differentiated market
• Ability to leverage creativity and innovation in
  problem
• Enhancement of organizational flexibility

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What is Innovation?

• Innovation means renewal or alter
• Prerequisite for innovation is the
  dissatisfaction with the current status and an
  inquisitive mind

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Innovation Management

• Innovation management is the discipline
  of managing processes in innovation. It can be
  used to develop both product and organizational
  innovation. Without proper processes, it is not
  possible for RD to be efficient.

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Innovation Management

• Innovation management includes a set of tools
  that allow managers and engineers to cooperate
  with a common understanding of goals and
  processes. It involves workers at every level in
  contributing creatively to a company's
  development, manufacturing, and marketing.

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What are innovation drivers?

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Focus of innovation management

• Allow the organization to respond to an external
  or internal opportunity
• Use its creative efforts to introduce new ideas,
  processes or products

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Change management

• Change management is an approach to
  shifting/transitioning individuals, teams,
  and organizations from a current state to a
  desired future state. It is an organizational
  process aimed at helping change stakeholders to
  accept and embrace changes in their business
  environment.

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6 Processes Associated with Organizational Change

• Innovation and change are facilitated when
  organizations create a stage that enables and
  motivates innovation.
• Stage-setting initially involves an extended
  gestation period involving many participants
  not spur of the moment, or single dramatic
  incident or a single entrepreneur.

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6 Processes Associated with Organizational Change

• Shocks (not mere persuasion), produced by
  exposing individuals to direct personal
  confrontations with needs or problems, are
  necessary to trigger attention and action for
  innovation.

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6 Processes Associated with Organizational Change

• Once innovation activities begin, the process
  does not unfold in a simple linear sequence of
  stages instead, it proliferates into complex
  bundles of ideas and divergent paths of
  activities.

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6 Processes Associated with Organizational Change

• Setbacks and mistakes are frequently encountered
  during the innovation process. Innovation or
  opportunities for learning through reinvention
  are often rejected. Learning fails when
  individuals initiating change cause consequences
  felt by people not involved in its initiation.

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6 Processes Associated with Organizational Change

• Change adoption is facilitated by modifying the
  innovations to fit the local organizational
  situation, through extensive involvement in and
  commitment to the innovation by top management.

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6 Processes Associated with Organizational Change

• Change processes vary with the novelty, size, and
  duration of the innovations being developed and
  adopted. The greater the novelty, size and
  duration of a change, the more complex the
  process.

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• Thank you for listening