Management yesterday &today Chapter 2 .ppt
- 1. •CHAPTER 2 •MANAGEMENT YESTERDAY AND TODAY 2–1
- 2. 2–2 Historical Background of Management • Ancient Management Egypt (pyramids) and China (Great Wall) Venetians (floating warship assembly lines) • Adam Smith Published “The Wealth of Nations” in 1776 Advocated the division of labor (job specialization) to increase the productivity of workers • Industrial Revolution Substituted machine power for human labor Created large organizations in need of management
- 3. 2–3 Major Approaches to Management • Classical theories • -Scientific Management • -General Administrative Theory • -Bureaucracy Theory • Neo-Classical Theories • -HR Approach • -Behavioral Approach • Modern Theories • -Quantitative Management • -Systems Approach • -Contingency Approach
- 4. 2–4 Scientific Management • Fredrick Winslow Taylor (guidelines for improving production efficiencies) 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
- 5. 2–5 • 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 General Administrative Theorists
- 6. 2–6 Division of Work. Specialization increases output by making employees more efficient. Authority. Managers must be able to give orders. Authority gives them this right. Along with authority,however, goes responsibility. Discipline. Employees must obey and respect the rules that govern the organization. Fayol’s 14 Principles of Management
- 7. 2–7 Unity of command. Every employee should receive orders from only one superior. Unity of direction. The organization should have a single plan of action to guide managers and workers. Subordination of individual interests to the general interest. The interests of any one employee or group of employees should not take precedence over the interests of the organization as a whole.
- 8. 2–8 Remuneration. Workers must be paid a fair wage for their services. Centralization. This term refers to the degree to which subordinates are involved in decision making. Scalar Chain. The line of authority from top management to the lowest ranks is the scalar chain. Order. People and materials should be in the right place at the right time.
- 9. 2–9 Equity. Managers should be kind and fair to their subordinates. Stability of Tenure of Personnel. Management should provide orderly personnel planning and ensure that replacements are available to fill vacancies. Initiative. Employees who are allowed to originate and carry out plans will exert high levels of effort. Esprit De Corps. Promoting team spirit will build harmony and unity within the organization.
- 10. 2–10 • Max Weber Developed a theory of authority based on an ideal type of organization (bureaucracy) Emphasized rationality, predictability, impersonality, technical competence, and authoritarianism.
- 11. 2–11 Max Weber’s Ideal Type Bureaucracy Hierarchical Structure Division of Labor Rules and Regulations Technical Competence {Recruitment on Merit} Positional Power Record Keeping Impersonal Decision Making
- 12. 2–12 Quantitative Approach to Management • Quantitative Approach Also called operations research or management science Evolved from mathematical and statistical methods developed to solve WWII military logistics and quality control problems Focuses on improving managerial decision making by applying: Statistics, optimization models, information models, and computer simulations
- 13. 2–13 Understanding Organizational Behavior • Organizational Behavior (OB) The study of the actions of people at work; people are the most important asset of an organization
- 14. 2–14 The Systems Approach • System Defined A set of interrelated and interdependent parts arranged in a manner that produces a unified whole. • Basic Types of Systems Closed systems Are not influenced by and do not interact with their environment (all system input and output is internal) Open systems Dynamically interact to their environments by taking in inputs and transforming them into outputs that are distributed into their environments
- 15. 2–15 Implications of the Systems Approach • Coordination of the organization’s parts is essential for proper functioning of the entire organization. • Decisions and actions taken in one area of the organization will have an effect in other areas of the organization. • Organizations are not self-contained and, therefore, must adapt to changes in their external environment.
- 16. 2–16 The Contingency Approach • Contingency Approach Defined Also sometimes called the situational approach. There is no one universally applicable set of management principles (rules) by which to manage organizations. Organizations are individually different, face different situations (contingency variables), and require different ways of managing.
- 17. 2–17 Current Trends and Issues • Globalization • Ethics • Workforce Diversity • Entrepreneurship • E-business • Knowledge Management • Learning Organizations • Quality Management
- 18. 2–18 Current Trends and Issues (cont’d) • Globalization Management in international organizations Political and cultural challenges of operating in a global market • Ethics Increased emphasis on ethics education in college curriculums Increased creation and use of codes of ethics by businesses
- 19. 2–19 Current Trends and Issues (cont’d) • Workforce Diversity Increasing heterogeneity in the workforce More gender, minority, ethnic, and other forms of diversity in employees Aging workforce Older employees who work longer and not retire The cost of public and private benefits for older workers will increase Increased demand for products and services related to aging
- 20. 2–20 Current Trends and Issues (cont’d) • Entrepreneurship Defined The process whereby an individual or group of individuals use organized efforts to create value and grow by fulfilling wants and needs through innovation and uniqueness. • Entrepreneurship process Pursuit of opportunities Innovation in products, services, or business methods Desire for continual growth of the organization
- 21. 2–21 Current Trends and Issues (cont’d) • E-Business (Electronic Business) The work preformed by an organization using electronic linkages to its key constituencies E-commerce: the sales and marketing component of an e-business • Categories of E-Businesses E-business enhanced organization E-business enabled organization Total e-business organization
- 22. 2–22 Current Trends and Issues (cont’d) • Knowledge Management The cultivation of a learning culture where organizational members systematically gather and share knowledge with others in order to achieve better performance. • Learning Organization An organization that has developed the capacity to continuously learn, adapt, and change.
- 23. 2–23 Current Trends and Issues (cont’d) • Quality Management A philosophy of management driven by continual improvement in the quality of work processes and responding to customer needs and expectations Inspired by the total quality management (TQM) ideas of Deming and Juran Quality is not directly related to cost.