Management theory is a set of ideas and rules intended to help supervisors/managers to know the goals of the organization, to understand what inspires people to work when achieving the goals of the organization and to plan work required to attain the goals of the organization in the most competent and effective way possible. HISTORICAL THEORIES OF MANAGEMENT Scientific Management Theory, Fredrick Taylor (1890-1940): Tasks were standardized as much as possible where workers were rewarded and punished. This worked well for organizations with assembly lines and other mechanistic, routinized activities.
Bureaucratic Management Theory, Max Weber (1930-1950): Max Weber embellished the scientific management theory with his bureaucratic theory focusing on dividing organizations into hierarchies, establishing strong lines of authority and control. Human Relations Movement (1930-today): A major belief included that the organization would prosper if its workers prospered as well. Fig. 1 Fig. 1 above summarizes evolution of management theories over the years i. e. Pre-Classical, Classical, Behavioral, Quantitative and Contemporary viewpoints. This article therefore assesses the Contemporary viewpoints.
The dominant theories of organizations prior to the 1960s were: 1). Classical/Traditional School, who saw organizational design as a rational structure, or mechanisms which would be imposed upon people and 2). Human Relations, or Social Psychological School, who saw organizations primarily in terms of the needs of the individuals within them. The theorists of human relations set out to humanize the work place at the expense of studying the organization as a whole.
They did not address themselves sufficiently to several major problems that can arise in practically every organization e. g. dealing with tensions between the requirements for structure and the needs of people. Questions of conflict tended to be dealt with in terms of avoiding it by attention to motivation and leadership. A further difficulty in the human relations approach was its emphasis on the practical application of ideas rather than on the conceptual development of organizational theory. This suggests we need to look elsewhere for a fuller explanation of behavior in organizations hence the birth of the theorists who see organizations as complex social systems responsive to a number of inter-dependent and important variables like the Contemporary Theory.
Contemporary approach to management focuses on the use of rigorous quantitative techniques to help managers make maximum use of organizational resources to produce goods and services. This school of thought or view point about management includes those major ideas about managing and organizations that have emerged since the 1950s. Some of the ideas, systems theory for example, are rooted in experiences gained during World War II. Contemporary viewpoints therefore consider the Systems Theory, Contingency Theory and Emerging Views.
The systems theory: This approach is based on the notion that organizations can be visualized as systems of interrelated parts or subsystems that operate as a whole in pursuit of common goals. According to Mullins (2010), a systems approach is a management approach that attempts to reconcile the classical and human relations. Here, attention is focused on the total work of the organization and the interrelationships of structure and behavior and the range of variables within the organization. The organization is viewed within its total environment and emphasizes the importance of multiple channels in interaction.
A system is a collection of part unified to accomplish an overall goal. If one part of the system is removed, the nature of the system is changed as well. A system can be looked at as having inputs, processes, outputs and outcomes. Systems share feedback among each of these four aspects of the systems. For an organization, inputs would include resources such as raw materials, money, technologies and people. These inputs go through a process where they’re planned, organized, motivated and controlled, ultimately to meet the organization’s goals. Outputs would be products or services to a market.
Outcomes would be, e.g. , enhanced quality of life or productivity for customers/clients and productivity. Feedback would be information from human resources carrying out the process, customers/clients using the products, etc. Feedback also comes from the larger environment of the organization, e. g. , influences from government, society, economics, and technologies. Typical systems are the solar system, the human body, communication networks and social systems. Open systems are those which do interact with their environment, upon which they rely for obtaining essential inputs and for the discharge of their system outputs e.g. social systems i. e. organizations.
Closed systems on the other hand are those which, for all practical purposes, are completely self-supporting and thus do not interact with their environment e. g. an astronaut’s life support pack. Closed systems are designed for efficiency whereas open systems on the other hand are designed for survival. The early classical theorists were expounding a closed systems approach while developments in human relations were biased towards open systems.
The modern consensus appears to be that both types are necessary for the maintenance and growth of successful organizations. The effect of systems theory in management is that writers, educators, consultants, etc. are helping managers to look at the organization from a broader perspective. Systems theory has brought a new perspective for managers to interpret patterns and events in the workplace.
They recognize the various parts of the organization, and, in particular, the interrelations of the parts, e. g., the coordination of central administration with its programs, engineering with manufacturing, supervisors with workers, etc This interpretation has brought about a significant change (or paradigm shift) in the way management studies and approaches organizations. Key variables that are of greatest interest to systems approach to organizations are People (as individuals and in groups), Organization structure, Environment (external conditions affecting the organization) and Technology (Technical requirements of work) otherwise known as POET.
Initially, the Tavistock researchers for example looked at the relationships between people and the technology and between structure and environment. The concept of socio-technical systems arose from the work of Scholars at the Tavistock Institute. Later Pugh and Colleagues have developed a more comprehensive and multi-dimensional approach, utilizing all of the above variables (POET). Contingency Theory: Basically, contingency theory asserts that when managers make a decision, they must take into account all aspects of the current situation and act on those aspects that are key to the situation at hand.
This approach is in marked contrast to the earliest universal approach stemming from the classical management school which suggested that there was one, and only one, best decision for managers to make which applied in all cases and to all organization, big or little, for profit, or not-for-profit, etc. Basically, it’s the approach that it depends. For example, the continuing effort to identify the best leadership or management style might now conclude that the best style depends on the situation.
The contingency approach applies particularly well in such areas as environmental factors, strategy, organizational design, technology, and leadership. For example if one is leading troops in the Persian Gulf, an autocratic style is probably best but a more participative and facilitative leadership style is probably best if one is leading a hospital or university. Therefore it can be concluded that the contingency approach is an extension of the systems approach in that it implies organizational variables (e. g. strategy, structure and systems) and its success or performance is dependent upon environmental influences (forces).
Emerging views: This is a continuous process of experimentation and adaptation, aimed at matching an organization’s capabilities to the demands of a dynamic and uncertain environment and such change is typically achieved through many small to medium sized incremental changes. Over time these can lead to a major reconfiguration and transformation of an organization Change is a multi-level, cross-organization processes that unfolds in an interactive and disordered fashion over a period of years, and is comprised of a series of interlocking projects.
The current concepts and practices shaping today’s management history and changing the way that managers do their jobs are summarized below: (i) Globalization: -organizational operations no longer stop at geographic borders. Managers in all types and sizes of organizations are faced with the opportunities and challenges of globalization. (ii) Entrepreneurship: -refers to the process whereby an individual or a group of individuals uses organized efforts and means to pursue opportunities to create value and grow by fulfilling wants and needs through innovation and uniqueness.
Managing in an E-Business World: -when organizations do its work by using electronic (Internet-based) linkages with key constituencies in order to efficiently and effectively achieve its goals. (iv) Need for Innovation and Flexibility: -constant flow of new ideas is crucial for an organization to avoid obsolescence or failure and flexibility is valuable in a context where customer’s needs may change overnight, where new competitors come and go, and where employees and their skills are shifted as needed from project to project.
Quality Management Systems: -Total quality management (TQM) is a philosophy of management that is driven by customer needs and expectations and focuses on continual improvement in work processes. TQM chief proponents W. Edwards Deming developed and presented his quality philosophy and theory which represents a counterpoint to earlier management theorists who believed that low costs were the only road to increased productivity. The objective of TQM is to create an organization committed to continuous improvement.
Learning Organizations and Knowledge Management: -Managers now must deal with an environment that is continually changing. The successful organizations of the 21st century will be flexible, able to learn and respond quickly, and be led by managers who can effectively challenge conventional wisdom, manage the organization’s knowledge base, and make needed changes. (vii) Theory Z: William Ouchi’s: -This Theory Z combines positive aspects of American and Japanese management into a modified approach aimed at increasing managerial effectiveness while remaining compatible with the norms and values of society and culture.
Whereas the classical approach may be criticized for almost viewing organizations without any regard for their people and the human relations approach emphasized people without organizations (and neither particularly considered organizations in turbulent environment), the systems approach takes holistic perspective, encouraging managers to view organizations both as a whole and as part of a larger environment (open systems).
The approach considers the interdependency of organizations parts, changes in one part –technical or social, will affect the other. The systems approach and systems thinking have formed the backbone of organizational analysis and can be applied to organizational design problems, strategy, change management and information systems. Whilst the contingency approach is an extension of the systems approach. Therefore, there is no one best way to structure or manage organizations; rather it must be dependent upon the contingencies of the situation.