UNIVERSITY OF NAIROBI

COLLEGE OF EDUCATION AND EXTERNAL STUDIES

SCHOOL OF CONTINUING AND DISTANCE EDUCATION

DEPARTMENT OF EXTRA MURAL STUDIES

BACHELOR OF ARTS IN PROJECT PLANNING AND MANAGEMENT

PRINCIPLES OF MANAGEMENT LECTURES

BY DR. JOHN OURU NYAEGAH

LECTURER: DEPARTMENT OF EXTRA-MURAL STUDIES.
 LECTURE ONE
INTRODUCTION TO MANAGEMENT
Lecture Outline

1.1 Introduction
1.2 Lecture objectives
1.3 Definition of management
1.4 Characteristics of management
1.5 Management functions
1.6 Managerial roles
1.7 Managerial skills
1.8 The art and science of management
1.9 Importance of management knowledge
1.10 Summary

1.1 Introduction
In this lecture we will discuss the significance of management in achieving organizational
objectives efficiently and effectively. Managers do this by carrying out the functions of planning,
organizing, staffing, leading, motivating, communicating and controlling. Managing is an
essential activity at all levels although the managerial skills and roles vary at different
organizational levels. This lecture begins with some background knowledge to the discipline of
management, and the main purpose is to understand the meaning, process, skills and functions of
management.
 1.2 Lecture objectives
At the end of this lecture you should be able to:
1. Define the concept of management
2. Describe the characteristics of management
3. State the functions of management
4. Explain the skills of a manager
5. Discuss the roles of management
6. Identify the components of the management environment
7. Discuss how management can respond to a changing environment.

1.3 The meaning of management

Management has been defined in many different ways by different authors. Here is a
sample: -
 Management is the art of getting things done through and with people in formally
organized groups.(Haimann, T.)
 Management is simply the process of decision-making and control over the actions of
human beings for the express purpose of attaining predetermined goals.(Vance S.)
 Management is a social process entailing responsibility for the effective and
economical planning and regulations of the operations of an enterprise in fulfillment
of a given purpose or task (Brech E. F., 1957).
 Management is the coordination of all resources through the process of planning,
organizing, directing and controlling in order to attain a given stated objective (Fayol
H. 1916; & Koontz and O’Donnel, 1976)

From the above range of definitions, it is obvious that management is a complex process
with many facets/elements/dimensions.
  Management is both a social and technical process that
comprises a series of actions that lead to the accomplishment
of objectives.
 It is a process by which the resources of production are
transformed from just “resources” to “production” (Peter
Drucker).
 It requires a combination of technical, human and conceptual
skills
 Managers are resources or assets in organizations

Activity 1.1

Write your own definition of management

1.4 Characteristics of Management:

To further enhance our understanding of the term management, we shall now examine
some of its major characteristics.

(i) Management is an activity.

Management is an activity that concerns the effective use of all resources both
human and non-human. It is the driving force that inspires an undertaking. It
creates the conditions and relationships that bring about the full use of resources.
(ii) Management is Purposeful and goal-oriented.
The main concern of management is the achievement of clearly defined goals or
objectives. Management is said to be successful only to the extent to which these
objectives are achieved.
(iii) Management is a Social Process
Organizations are social entities, as they are constituted of people. As such,
management has to control, organize and motivate people and create a favourable
climate for their development.
(iv) Management is getting things done.
A manager does not usually do the operating work himself, but gets the work
done with and through people. A manager has to direct people, harness talents
through training and procure technical, human, and psychological skills
(intellectual capital).
(vi) Management is an intangible force.
Though intangible, management is not abstract but a social skill which is evident
by the quality of the organization in terms of the efficiency and effectiveness of its
operations.
(vii) Management is an Integrating Process.
Management brings together people, machines and materials to carry out the
operation of the organization and achieve a set of given objectives. It is a result-
oriented process.
(viii) Management is separate from ownership.
Management and ownership may be the same in small family or individual or sole
proprietorship businesses, but in modern enterprises or corporations, a vast number of
shareholders own the business enterprise or organization, while management is in the
hands of qualified, professional and competent managers, who normally do not
posses any ownership interest.
(ix) Management is a Universal Activity
The techniques and tools of management are universally applicable. Managers
perform the same functions regardless of their position in the management hierarchy,
type of enterprise or location of enterprise.
(x) Management is a social science
The science of management is universally accepted as a distinct discipline. It has
assumed professional character, hence requiring the use of specific knowledge, skill
 and practice. It utilizes certain fundamental concepts, theories, tools and techniques
that constitute the subject matter of management. It therefore satisfies all the
conditions of a profession.

1.5 The art and science of management

Management can be said to be both a science and an art. First, it is a science because it is
based on a set of organized knowledge founded on proper scientific findings and exact
principles. It is part of the branch of science known as social science just like sociology,
economics or history. The other branches of science are physical science, biological
science etc. Management is also a behavioral science in which its theories and principles
are based on the situation.

Management can also be an art. An art refers to the best way of doing something.
Management can be said to be the process of directing scientific knowledge to the
accomplishment of objectives. Like any other art, management is creative, develops new
situations, new designs and new systems needed to improve performance. Art therefore
is the ‘know-how’ or ‘technique’ to achieve a desired result. The most productive art is
always based on an understanding of the science underlying it.

Art and science therefore are not mutually exclusive but are complementary. As science
improves, so should art. As Koontz and O’Donnell point out ‘physicians without a
knowledge of science become witchdoctors, but with science, they become skillful, artful
surgeons.’ Therefore, managers who operate without scientific knowledge (in the form of
theory) can only trust in luck, intuition, common sense and experience (which may be
wrong experience). However, in utilizing theory and science, managers must learn to
blend knowledge (principles) and practice to achieve desired results.

1.4 The Scientific Method in Management.

The purpose of science is to explain phenomena. Science is based on the belief that
relationships can be found between two or more sets of events. The scientific method
involves determining facts through observation of events and verifying their accuracy
 through continued observation. After classifying and analyzing the facts observed,
scientists establish causal relationships known as hypotheses that they test for accuracy.
When hypotheses are supported, and are found to explain or predict reality they become
principles. However, principles are not permanent they can still be challenged by future
research and analysis and either modified or discarded.

Principles, Theory and Concepts: Principles, theory and concepts form the structural
framework of a science.
Principles are fundamental truths or what are believed to be truths at a given
time, explaining relationships between two or more sets of variables.
For example: Motivation has a positive effect on the performance of employees.
Theory is a systematic grouping of interrelated principles. It ties together significant
knowledge to form a framework.

For example, the theory of attribution which explains the behaviour of an individual on
the basis of whether it was caused by an external or an internal influence. Internal causes
are those believed to be under the personal control of the individual while external causes
are those believed to be beyond the control of the individual. These are judged on the
basis of distinctiveness, consensus and consistency.

Concepts are mental images of something formed by generalization from particulars.

Concepts are the building blocks of theory and principles. However, they tend to always
imply different things to different people. For example concepts such as: management,
organization, technology, labour etc.

1.5 The basic functions of management

The job of management is to help an organization make the best use of its resources to achieve
its goals. They do so by performing essential managerial functions which include:
 Planning
 Organizing
 Directing
  Staffing
 Controlling
Planning: It is the process of setting goals and objectives and showing how these goals and
objectives will be accomplished.
Organizing: This refers to the process of establishing a structure of working relationships. It
involves grouping people into departments according to specific tasks performed and deciding
how best to coordinate organizational resources.
Directing: This is the process of communicating what has been planned by leading and
motivating the efforts of people towards attainment of goals
Staffing: This function refers to the process of filling positions with the right kind of people in
the right job at the right time.
Controlling: This refers to the process of evaluating how well an organization is achieving its
goals and how to maintain and improve performance.
Figure 1 below illustrates the relationships among these functions. It indicates that all the
functions are interdependent.

Figure 1: Interdependence among managerial functions

1.6 Managerial roles
Managers play several management roles: a role is a set of specific tasks that a person is
expected to perform in the position they hold. According to Henry Mintzberg, managers play
three major roles:
i) Interpersonal roles:
 Figurehead – a manager a representation or a symbol of the organization. They determine
the direction or mission of the organization. They inform stakeholders such as employees
about what the organization is seeking to achieve. They put up appearances on behalf of
the organization eg receiving guests at the workplace or attending an employee’s
wedding.
 Leader – a manager occupies a position of influence, hence has to inspire and encourage
others to perform. They train, coach, counsel and mentor subordinates to reach their full
potential
 Liason – managers are the link between the organization and the larger society. They deal
with people outside the organization such as suppliers and customers and inside by
coordinating the activities of people in different departments.
ii) Informational roles: These roles are closely associated with the tasks necessary to
obtain and transmit and transmit information. The roles are:
 Monitor – managers analyze information from inside and outside the organization
so that he can effectively control and organize people and other resources.
 Disseminator – Managers transmit information to other members in the
organization so as to influence their work attitudes and behaviour
 Spokesperson – managers use information to promote the organization so that
people inside and outside the organization can respond positively to it
iii) Decisional roles: managers plan and lay strategies for achieving goals and utilizing
resources. They act as:
 Entrepreneurs: Managers decide which projects or programmes to initiate and
how to invest resources to increase organizational performance
 Disturbance handler: managers assume responsibility for handling unexpected
events or crisis that threatens the organizations access to resources. In this
 situation a manager also assumes the roles of figurehead and leader to mobilize
employees to help secure the resources needed to avert the problem.
 Resource allocator: managers decide how best to use available resources to
increase organizational performance.
 Negotiator: managers work out agreements and contracts that will operate in the
best interest of the organization.
The relationships among these roles are illustrated in figure 2 below.
Figure 2: Illustration of managerial roles
Figurehead

Interpersonal Leader
roles
Liason

Monitor

Informational
roles Disseminator

Spokesperson

Decisional Entrepreneurs
roles
Disturbance handler

Resource allocator

Negotiator
1.11 Managerial skills

Skills is what separates good managers from ordinary managers. Education and experience
enable managers to develop the skills they need to put organizational resources to their best use.
There are three types of skills:
i. Technical skills: These are needed to perform specialized tasks. They involve the
ability to use knowledge, methods, techniques and equipment necessary for the
performance of specific tasks. These skills are acquired from experience, education
and training. They are more useful for lower level management at supervisory
levels because they train others in the actual job.
ii. Human skills: The ability to work with and through people including understanding
of motivation and application of effective leadership. Also includes the ability to
mould individuals into a cohesive team. Human skills are useful for middle
managers as they link the top and the lower levels of employees.
iii. Conceptual skills: This skill is demonstrated in the ability to analyze and diagnose a
situation and to distinguish between cause and effect. Involves understanding the
complexities of the overall organization and the various variables that influence its
operations. It is about seeing the ‘big picture’.

The appropriate mix of these skills varies as an individual advances in management

from supervisory to top management positions. The relationship between
management level and skills needed is illustrated below.
 Management Skills needed
level

Executive……
Conceptual
skills
Managerial……

Human skills

Supervisory….. Technical
skills

Figure 1: Managerial roles

More conceptual skills are needed at executive levels as executives should be able to see how all
operative functions are interrelated in accomplishing organizational goals. Their focus is external
and global. Human skills are therefore crucial to all levels of management as attested by the
following statement:

“I will pay more for the ability to deal with people than any other ability under the sun”
(John D. Rockeffeler, American entrepreneur).

In other surveys, human skill has been rated higher than intelligence, decisiveness and
knowledge and job skills.

1.9 Importance of Management Knowledge

Knowledge of the basic principles and techniques of management is important for a number of
reasons.
(i) To increase efficiency.
Development and use of management principles improves managerial efficiency.
Managers can apply established guidelines to help solve problems without having
to resort to trial and error – which is risky and costly to the organization.

Although experience is important, it is not enough as no two situations or

problems are the same nor can be solved using the same methods. Hence an
understanding of management theory, principles and concepts allows the manager
to see and understand what otherwise would remain unseen. Awareness of
management principles helps managers avoid mistakes.

(ii) To understand the nature of management.

An understanding of the concepts, principles and techniques of management
enables managers to analyze the managerial job and train others. The knowledge
of these fundamentals acts as a checklist of the meaning of management. With
the accumulation of management knowledge, management training is simplified.

(iii) To achieve social goals.

Development of management knowledge and its skillful use in the management of
people and material resources can have a revolutionary impact on society.

For example, it is observed that nations with high levels of material standards of
living tend to have high levels of knowledge and skill in the management of
business. Management has a social responsibility in addition to making profit.
They oversee the operation of the economic systems that fulfills the expectations
of the public such as safeguarding shareholders investment, providing a
reasonable return, keeping employees satisfied and contented by ensuring
payment of fair wages, good working conditions and security of employment.
 Management is also responsible for customers’ needs e.g. quality goods and
services.

To the State, it is the major source of income through taxes hence the business
must be conducted in accordance with state policy. It also has responsibility to
the society by maintenance of ethical behaviour. It should also be innovative and
creative to produce goods and services for the increased comfort of mankind. It is
management knowledge therefore that enables these multidimensional
responsibilities of management to be achieved.

The key to successful management is the ability to identify the

right things to be done (effectiveness) and to concentrate
resources on them (efficiency)
Using examples, identify the consequences of poor
management to: employees, customers/clients, suppliers,
government and society

1.10 Environmental influences on management

Although most of a manager’s time is spent in interactions with subordinates inside the
organization, the manager must also deal with issues in the external environment. These consist
of the micro, market and macro environments.

2.1 Composition of the Management Environment

The environmental concept refers to the sum total of the factors or variables that may influence
the continued existence of an organization. They may be factors inside or outside the
organization. An organization does not exist in a vacuum, but in an environment that provides
resources and limitations. To remain prosperous, therefore, it must continually adapt to its
environment, which is constantly changing.
An organization and its environment are interdependent. The environment provides resources
and feedback to the organization and it, in turn, produces the goods and services required by the
environment.

An organization exists only for as long as activities are

desired and supported by the environment. The
environment is made up of threats, opportunities limitations
and resources.

1.11 Types of environments

i) Micro environment
This consists of the organization itself:
o The mission, goals, objectives and strategies of the organization.
o The organization and its management
o The resources of the organization e.g. employees, capital, finance, etc
o The organizational culture.

ii) Market environment

This is the environment that surrounds the organization also known as the competitive or
industry and comprises of:
 Consumers, their needs, purchasing power and behaviour.
 Suppliers of materials, capital and labour
 Intermediaries e.g. wholesalers and retailers, commercial agents and brokers, banks
etc.
 Competitors e.g. new entrants, existing competitors, availability of substitute products
or services and the bargaining power of clients, consumers and suppliers.

iii) Macro environment

Is that which exists outside the organization. It comprises:
  Technological environment: responsible for accelerating change and innovation and
creating opportunities and threats in the environment.
 Economic environment: responsible for change in the environment because of
changes in economic growth rate, levels of unemployment, consumer income, rate of
inflation and the exchange rate.
 Socio-cultural environment: referring to changes in value systems, family structures,
education, attitudes, ethics, workforce diversity, etc.
 Ecological/physical environment: is concerned with the natural resources from
which the organization derives its raw materials and the environment on which the
organization discharges its waste.
 The political-governmental environment: refers to the government and its influence
on the organization, e.g. in terms of political risk, legal matters, government
expenditure etc.
 The international environment: comprises of the factors emanating from other
countries with which the organization directly or indirectly has business relations.

An organization can therefore be said to be an open system because it is dependent on the

environment in which it operates. (A closed system can exist independently). There is specific
interaction between the system and the environment.
Ways in which management can react to the Environment.

 Environmental scanning: refers to the measuring, projection and evaluation of

change in the environment. Organizations management information systems
should make provision for this.
 Strategy response: This may include changes in present strategy or formulation of
new strategies.
 Structural Change: The organization structure can be redesigned, adapted or
modified as a response to changes in the environment e.g. a flexible vs.
bureaucratic structure, integration vs. differentiation, decentralized vs. centralize
etc.
 Cultural change: change the organizational culture from closed to open etc.
2.4 Organizational culture and environment
Organizational culture is a pattern of shared beliefs and values (Morgan 1986) (Shared meaning,
shared understanding and shared sense making). Handy (1993), notes that organizations have
differing atmospheres, differing ways of doing things, differing levels of energy, individual
freedoms and kinds of personality. Organizations are like mini societies that have their own
distinctive patterns of culture and sub-cultures which can exert a decisive influence on the
overall ability of the organization to deal with its challenges.

The dominant culture that develops in an organization is the product of its founders aims and
styles and their successors in senior management and interaction with a variety of internal and
external forces.

Determinants of organizational culture

 Organizational mission and vision
 Corporate aims
 Policy statements
 Rituals, eg dressing, address
 Logos, brand names
 Rules, procedures
 Management attitudes
 Peer group attitudes
 Structures
 Technology etc

Consider a recent event that occurred at any of the three types of

environments described above. State whether it was a social,
political economic or technological event; which businesses were
affected and how; which other environments have been affected by
this event and how?
 1.10 Summary
In this lecture we have discussed the meaning and characteristics of management. The five
major functions of management – planning, organizing, directing, staffing and controlling
were briefly introduced. We also discussed the roles of management and skills that mangers
require at different levels. These are technical, human and conceptual skills.
 LECTURE TWO
MANAGEMENT THEORY

Lecture outline

2.1 Introduction
2.2 Lecture objectives
2.3 Classical scientific management
2.4 Bureaucratic approach
2.5 Neo-classical approach to management
2.6 Summary

2.1 Introduction

In lecture two, we shall discuss the theories of management. These are divided into the classical,
bureaucratic and neo-classical approaches to management.

2.2 Lecture objectives

At the end of this lecture, you should be able to:
1. Describe the principles of scientific management as advanced by Fredrick Taylor
2. Discuss the rational-economic view in relation to scientific approach to
management
3. Discuss the principles of management as advanced by Henri Fayol
4. Examine the bureaucratic approach to management as advanced by Max Weber
5. Describe the human relations approach to management

2.3 Classical Approach To Management

The history and theory of management are important to managers for various reasons:
 They help managers understand current developments and avoid mistakes of the past
 They foster an understanding and appreciation of current situations and developments
and facilitates the prediction of future conditions
 They help managers organize information and approach problems systematically. Without
knowledge of theory, managers would be using guess work, hunches, intuition and hopes
which may not be useful in the present complex and dynamic organization.

The practice of management can be traced to the beginning of man. Egyptian, Greek, Roman
and Chinese civilizations all have records indicating the importance of management. (The
 writings of Sun Tzu on the ‘Art of War’, written 2500 years ago are a lesson on strategic
management)

In Greece, Socrates the famous philosopher observed that “the management of private affairs
such as households is not different from the conduct of public affairs except in magnitude”

The biblical Moses used the Principle of delegation and hierarchy of command to manage the
Israelites during the exodus. (Exodus 18: 1-27). Joshua used the management techniques to
recruit soldiers for war.

The Roman Catholic Church over the centuries has effectively used the principles of division
of labor and hierarchy of authority.

The Roman empire colonized many parts of the world for many centuries by effectively
using basic management ideas such as scalar principle and delegation of authority.

Niccolo Machiavelli in ‘The Prince’ gives relevant ideas on how to develop and use
management skills. He suggests to ‘The Prince’ ideas on – consent of the majority,
inspiration of people to greater achievement, offer of rewards and incentives and taking
advantage of all opportunities.

The above early influences on management, however, do not give much insight
into the principles of management as they are not organized and the relationships
among various variables are not explained. The knowledge is based on trial and
error and experience rather than organized scientific knowledge.

It was only in the late 19th century that large business organizations requiring systematic
administration started to emerge. We shall focus on two early schools of management.
 Classical management theory
 Human relations neo-classical theory

2.4. Classical Management Theory

Classical theory is divided into scientific management and administrative management.

Scientific management theory: Changes in economic and production patterns during the
industrial revolution led a few practicing managers to examine the causes of inefficiency in
production. It is these basic studies that led to a system of management known as scientific
management.

Scientific management has been defined as the application of scientific method

of study, analysis and problem solving in organizations.
2.4.1 The Thoughts of Frederick Taylor (1856-1917)

Taylor, an engineer in an American steel firm was concerned about the best methods of doing
jobs. He saw the main problem to be that of efficiency of workers in relation to existing property
relationships between workers and owners of organizations. He suggested the development of a
true science of management where methods for performing each task could be determined. He
advocated a mental revolution by both management and workers.

His findings were:

(i) Workers deliberately restricted production in their daily work due to fear
of unemployment and lack of piece rate system.
(ii) Lack of work rationalization, hence overlapping of jobs. The method of
working was also too complicated.
(iii) Due to poor remuneration, workers formed themselves into groups and
labour unions to press for better wages.
(iv) Management left the initiative of working methods to the ingenuity of
workers (rule of thumb).

To solve the above problems, Taylor suggested the following principles to guide
management.

(i) Each worker should have a clearly defined daily task.

(ii) Establish standard conditions to ensure the task is more easily

accomplished e.g. work-study and motion studies.

(iii) High payment for successful completion of tasks and none or lower
payment when standards are down. He believed money was a major
motivator.

For management, he suggested: -

(i) The scientific selection, education and development of workers.

(ii) Friendly, close cooperation between management and workers.

(iii) Managers should take more supervisory responsibility, arguing that

workers preferred to be given a definite task with clear-cut standards.
  He emphasized planning and greater control by managers.
 He believed adoption of scientific approach to managing would lead to
prosperity for both managers and workers.
 He believed conflict about how to divide profits was retrogressive and
unproductive.
 Wages should be scientifically determined and should not be left to the whims
of managers or power of trade unions.

The concepts/ideas advanced by Taylor are not far from the fundamental beliefs
of the modern manager. A number of post Taylor studies are found in the literature e.g.
The Hilbreths, Gault, Emerson, and Filene. They all attempted to improve on Taylor’s
ideas.

The basic assumptions of scientific management were:

 Improved results in organizations will come from the application of scientific

methods of analysis to organizational problems. This implies that scientific
approach to problems is superior to other methods eg informal sector
 The focus is on the work itself and not the particular person doing the work
 Each worker is assumed to be a classical economic man hence interested only in
maximization of his monetary income

Evaluation of Scientific management

While Taylor’s ideas of scientific management contributed to modern management, there were
also a number of limitations.
Limitations
 The revolutionary ideas advocated by Taylor increased productivity but led to layoffs
 It assumed people were rational and therefore motivated only by material gains. Taylor
and his followers overlooked the social needs of workers. They assumed that one had
only to tell workers what to do to increase their earnings and they would do it. However,
people have needs other than money e.g. recognition and acceptance
 They also overlooked the human desire for job satisfaction and workers became more
willing to go out on strike over job conditions rather than salary.
 The assumption that human beings are rational creatures who base their decisions on
rationality and logical analysis of their needs is not universally applicable to all human
beings.

Benefits of the Scientific Management Thoughts.

(i) Its rational approach to organization of work enabled tasks to be measured

with accuracy.

(ii) Tasks measurement and processes provided useful information on which to

base improvement on working methods.

(iii) Improvement of working methods brought enormous increases in

productivity.

(iv) Enabled employees to be paid by results and to take advantage of incentive

schemes.

(v) Stimulated management into adopting a more positive role in leadership at the
factory level.

(vi) Contributed to major improvements in physical working conditions.

(vii) It provided the foundations on which modern work study and other
quantitative techniques are based.

Disadvantages of the Scientific Management.

(i) Reduced the role of workers to that of rigid adherence to methods and
procedures over which they have no discretion.

(ii) Led to fragmentation of work because of emphasis on analysis and

organization of individual operations, hence boring, repetitive jobs.

(iii) Generated a carrot and stick approach to the motivation of employees

enabling pay to be geared tightly to output.

(iv) It put the planning and control of workplace activities exclusively in the hands
of management, alienating workers.

(v) Ruled out any realistic bargaining about wage rates since every job was
measured, timed and rated scientifically.
 Fayol, Taylor and their followers have attempted to find rational principles
that can be applied to the development and management of organizations.
However while most have been adopted, some are difficult to implement in
practice because of changes in organizations and environmental conditions.

2.5 Administrative Theory

This theory came out of a need to find guidelines on how to manage complex
organizations such as factories. Henry Fayol is recognized as the father of classical
organization theory since he was the first person to systematize managerial behaviour.
Another contributor is Max Weber (1864-1920) with his bureaucratic model.

2.5.1 HENRI FAYOL (1841-1925).

Fayol was an engineer in a large French Company. Fayol, unlike Taylor started in
management and his ideas therefore are more concerned with the science of management.
As such he drew up a list of principles of management.

Fayol believed that sound managerial practice fell into patterns that could be identified
and analyzed. He also believed that management is not a personal talent but a skill that
can be taught and learnt.

It is notable that Fayol’s observations fit well into the currently developing management
theory.

He defined management in terms of:

(i) Technical activities - production.
(ii) Commercial “ - buying and selling.
(iii) Financial “ - securing capital.
(iv) Security “ - safeguarding financial information.
(v) Managerial “ - planning, organizing, controlling and
directing.
He noted that of all these activities, it is managerial activities that have not been given
much attention and he dealt more with it.
Based on his experience, Fayol listed 14 principles of management.

1. Division of work - Necessary to efficiency of labour as it reduces span of

attention or effort hence increasing specialization.

2. Authority and Responsibility - The right to give orders.

3. Discipline -Respect for formal and informal agreements between firm and
workers and obedience to rules and regulations.

4. Unity of command - One person, one superior, employees should receive

orders from one superior only to reduce confusion.

5. Unity of Direction - One head, one plan for a group of activities with the
same objective.

6. Subordination of the individual interest to general interest -The interests

of one individual or one group should not prevail over the general good.

7. Remuneration - Pay should be fair to both worker and firm.

8. Centralization - Refers to the extent to which authority is concentrated or

dispersed. Circumstances of organization e.g. size will determine the extent to
which an organization is centralized

9. Scalar Chain - “Chain of Superiors” or line of authority from top to bottom.

10. Order - A place for everything i.e. the right person in the right job or place.

11. Equity - Refers to loyalty and devotion from personnel by use of kindliness
and justice on the part of managers.

12. Stability or Tenure of Personnel - Refers to the costs and dangers of

turnover due to bad management.

13. Initiative -All levels of personnel should be encouraged to show initiative as

it is a source of satisfaction.

14. Espirit de corps - “In union there is strength”. This is an emphasis on

teamwork, harmony and communication.
2.6 MAX WEBER (1864-1920)

Max Weber advocated for a bureaucratic approach to management to reduce abuse

of power by people in managerial positions. This is an approach that runs on rules and
regulations.

The concept of bureaucracy is attributed to Max Weber (1864-1920), a German

sociologist. He lived in the period of history as the early pioneers of management
thought such as Fredrick Taylor and Henri Fayol. Weber however, was an academic
and not a practicing manager.

His interest in organizations was from the sociological perspective of why people
obeyed those in authority and why those in authority abused power. He published “the
theory of social and economic organization” which was translated into English in
1947. He used the term bureaucracy to describe the structure of organizations.

Bureaucracy
Is a term that has been used to mean:
 Red tape – an excess of paper work and rules leading to gross inefficieny
 Officialdom – all the apparatus of local and central government
 An organizational form made up of rules and hierarchy of authority.

Characteristics of Bureaucracies
 Specialization – have a high degree of labour division thus ability and not
personal loyalty is the condition for employment
 Rational – official jurisdictional areas are rationally determined by a clear
hierarchy of authority; duties and measures of performance are established
and positions are well defined and formalized in writing.
 Professional - follows formal impersonal procedures of the organization.
Organizational structures are well defined and exist prior to filling
positions with people.
 Impersonal - authority is impersonal and amount of authority corresponds
with rank of office
 Autonomous – officials, because of their expertise and technical
competence are recognized and rarely questioned within their areas of
expertise.
 Stable – performance is encouraged by rewards in form of stable careers,
regular salary, promotion and pensions.
- A bureaucratic organization has a functional structure, clear lines of authority and
obedience is owed to established rules and regulations.

- It has hierarchical levels of authority with firmly ordered superior-subordinate

relationships.

- Terms of employment are based on rank of office rather than amount of work
(performance)

- Bureaucracy is common in large complex organizations which depend on

specialization, rules and procedures for efficiency

Weaknesses
 Works well only in stable environments where the work and information
handled are highly predictable, recurrent, routine and familiar.
 Rules become so important that they become an obstacle to efficiency
 Decision making processes are programmed hence discouraging search for
other alternatives (is rigid)
 Rigid behaviour damages relations with clients or customers as they are
unable to get tailor made services but have to accept the standard provided
within the rules.
 Difficult to change and adapt to new circumstances
 It undervalues the human element by assuming that people are passive and
respond only to rules and incentives. It failed to see the fact that people are
capable of going against rules.

 What common features do you see between Fayol’s principles of

management and Weber’s description of bureaucracy?
  Discuss the advantages and disadvantages of bureaucratic
structures. Why do you think such structures may not be suitable
for organizations that operate in highly unstable environments?
 Discuss the situations in which bureaucratic systems are desirable

2.7 Neo-Classical Theory Of Management

Human relations school of thought

While the scientific management theorists were more concerned with the mechanics and
structure of organization, the human relations school of thought was more concerned with
the human factor i.e. people and their relationship with the organization, fellow workers
and the job.

The emergence of industrial psychology in 1913 provided the impetus in the studies on
human problems in organizations.

The works of Elton Mayo (1880 – 1949).

Elton was an Australian practicing psychologist at Harvard University. He carried out

experiments at the Hawthorne Plant of Western Electric over a period of time and his
findings can be summarized as follows:-

(i) Individual workers cannot be treated in isolation but must be seen as

members of a group.
(ii) The need to belong to a group and have status within it is more
important than monetary incentives or good working conditions.
(iii) Informal groups at work exercise a strong influence over the behaviour
of workers.
(iv) Supervisors need to be aware of these social needs and cater for them
if workers are to collaborate with the official/formal organization
rather than work against it.
 The studies proved that interpersonal and group values are superior to
managerial and individual values. Managers who do not have the enthusiastic
support of the groups they supervise will be unable to motivate individual
members to a significant degree.

Weaknesses of the human relations school of thought

 In viewing people as the most important organizational variable it committed the

mistakes of earlier theories of suggesting one best way of managing
 It saw workers as social beings motivated by social needs but this is too simplistic as
human beings are complex and motivated by many variables
 It assumed satisfied workers are highly productive but this is not always true

Assumptions about people.

To understand the human factor in organizations, assumptions made about people need to
be understood especially in the superior-subordinate relationship. The major theories of
motivation and leadership were developed after the Hawthorne studies of Elton Mayo.

Edgar Schein (1965)

Schein was an American academic who published a classification of assumptions about

people. Implicit in management ideas is what motivates people.

(i) Rational – Economic Man

This view or assumption has its roots in the economic theories of Adam Smith (1776). It
states that self-interest and the maximization of gain are the prime motivators of people.
It stresses man’s rational calculation of self-interest especially in relation to economic
needs. Hence people are either untrustworthy and money-motivated or trustworthy and
motivated by broader issues. This appears to have been an important assumption in the
mind of Taylor and his followers.
(ii) Social Man
This assumption draws from the conclusions of Elton-Mayo. This view sees people as
dominated by social needs. Acceptance of this view means managers need to pay more
attention to people’s needs rather than tasks, groups and a change of role for manager
from organizer and controller to guide and supporter.

(iii) Self-actualizing man

This view is based on Maslows theory of human needs. It sees self-fulfillment needs as
the main driving force behind individuals. The managerial strategy should be one that
provides challenging work, delegation, responsibility and autonomy of work. While this
view is true for managers and professional staff, it is less clear for lower grade
employees.
(vi) Complex Man
This view sees human beings as complex and variable. People’s motives vary depending
on tasks, work groups or organizational climate. Managers must therefore be able to also
adapt and vary their own behaviour in accordance with the motivational needs of
particular individuals and teams. Schein sees motivation in terms of psychological
contract based on the expectations that employers and employees have of each other.
Hence the relationship between an individual and his organization is an interactive one.

Douglas McGregor (1967)

Like Schein’s classifications, McGregor’s theory X and theory Y are a set of assumptions
about people. After observing the actual practice of managers, he proposed that they
were operating on two levels.

(a) Theory X
i. The average person has an inherent dislike for work and will avoid it if
possible.
ii. Because of dislike for work, people must be coerced, controlled, directed
and threatened with punishment to get them to work.
iii. The average human being prefers to be directed, wishes to avoid
responsibility, has limited ambition and wants security above all else.

(b) Theory Y
i. The use of physical and mental effort in work is as natural as play or rest.
ii. People will exercise self-direction and self control in the service of
objectives to which they are committed.
iii. Commitment to objectives is a function of the rewards associated with
achievement.
iv. The average human being learns under proper conditions not only to
accept but to seek responsibility.
v. The capacity to exercise a relatively high degree of imagination, ingenuity
and creativity in the solution of organizational problems is widely and not
narrowly distributed.
vi. Under conditions of modern industrial life, the intellectual potentialities of
the average human being are only partially utilized.

Conclusions
 Attitudes and behaviour towards other people are a reflection of the
assumptions we make about people.
 McGregor’s theory X corresponds closely to Schein’s rational-economic
man, while theory Y corresponds to self-actualizing man.
 McGregor’s assumptions have found wide application in issues of
leadership than in general management.
 Based on these assumptions, managers should consider seriously practices
such as flexibility in working time, job enrichment, performance appraisal,
participation etc.
 In real life, a blend of the two assumptions can be observed.
 LECTURE THREE
PLANNING
Lecture outline

3.1 Introduction
3.2 Lecture objectives
3.3 Meaning of planning
3.4 Types of plans
3.5 Strategic planning
3.6 The Planning process
3.7 Objective setting techniques in planning
5.8 Barriers to effective planning
3.9 Summary

Introduction

Planning is the first task of a manager and forms the basis from which all the other tasks are
derived. Management decides the future of the organization, by planning, strategizing and
implementing plans.

3.1 Lecture objectives:

At the end of this topic you should be able to do the following:
 Explain why planning is important.
 Explain the meaning of planning premises
 Describe the nature of goals/objectives
 Identify and discuss the steps in planning
 Discuss the usefulness of management by objectives (MBO) in planning
 Describe the importance of strategic planning
 Discuss the barriers to planning

What is Planning?

Planning is deciding what objectives to accomplish, the actions to be taken in order to

achieve them, the organizational position assigned to do them and who would be responsible
for the actions needed.

 Planning precedes all other managerial functions as it establishes the

objectives and purpose of the project or enterprise.
  It is the ‘star or compass’ which directs the project.
 Planning is a pervasive function – as it is performed by all managers at all
levels. It only varies with authority and nature of policies. (A manager is not
a manager if he does not perform a planning function).
 Research has shown that effective supervisors even at the lowest levels are
those who have the ability to plan.
 Plans must be efficient – where efficiency is measured by the contribution of
the plan to accomplish objectives at the lowest cost. It implies the input-output
ratio and cost-benefit analysis of the of the plan.
 Efficiency of plans is not measured only in terms of money but intangible
costs such low morale, hostility by employees, layoffs, and resentment.
 A plan becomes inefficient if it cannot accomplish its intended objective or
accomplishes it at high costs e.g. A CEO who adopts a retrenchment plan to
cut costs only to experience lower productivity due to fear, resentment and
loss of morale by the employees thus defeating the objectives of reducing
expenses and making profits.

Organizations function in uncontrollable environments and to survive they must plan to enable
them be proactive. Effective planning requires development of objectives to direct the plans.

Plans can be influenced by:

 Values, experiences and personality of the leader of an organization.

 Corporate culture – i.e. the beliefs and values shared by people.

Types of Plans

Plans are hierarchical. They range from the broad mission or purpose of the organization to
specific strategies.
 Mission or purpose (tend to be
vague)

Goals & objectives (aimed at

specific activity)

Strategies (programme of action

to meet objective)

Major & minor policies

(guides for decision making)
Procedures & rules (customary methods
for handling future activities)
Programmes/projects (specific tasks
with aims, rules etc.)
Budgets in figures (plan of
expected results expressed
numerically)

Scope of plans

Strategic plans - These are broad plans developed by top managers to guide the general direction
of the firm. They follow from major goals of the firm and indicate what business the firm is in or
what business it intends to be in. They show where the firm will position itself within its
environment.
Tactical plans - They have a moderate scope and immediate timeframe. They are concerned with
how to implement the strategic plans that are already developed. They deal with specific
resources and time constraints. They mainly focus on people and action. They are mainly
associated with middle management.

Operational plans

They have the narrowest focus and they fall into many types. They include:

Standing plan- these are developed to handle recurring and relatively routine situations. When
the same situations occur repeatedly, managers have to develop policies, rules and standard
operating procedures to control the way employees perform their tasks.
Single use plans – are developed handle non-programmed decision making in an unusual or
unique situation, e.g. specific action plan to complete a project or programme.

Long-range planning – covers several time periods from 5 years. They are mostly associated
with with activities such as major expansion of facilities, development of top managers, change
of manufacturing systems etc.Top managers are responsible for long range planning
(modernization of Kenyan airports is a KAA long range plan driven by top management)

Intermediate planning – they are less than five years and because of the uncertainty associated
with long-range plans, intermediate plans are the primary concern of most organizations. They
are usually developed by both top and middle management. They are the building blocks in the
pursuit of long range plans.

Short range planning – These cover time periods of one year or less. They focus on day to day
activities and provide a concrete base for evaluating progress towards achievement of
intermediate and long range plans e.g. the economic survey.

Levels of planning
Planning takes place at three levels of management: corporate, business and functional.

Corporate level strategy: The corporate level plan contains top management decisions pertaining
to the organization’s mission and goals, overall strategy and structure. The corporate level
strategy indicates the industry and markets the organization intends to operate in. It also provides
the framework within which managers create their business level plan.

Business level strategy: states the methods the division or business it intends to use to compete
against its rivals in an industry. The business level plan provides the framework within which
functional managers propose to pursue to help the division attain its business level goals which
in turn will allow the organization to avhieve its corporate goals.

Functional level strategy: These set out the actions managers intend to take at the level of
departments such as manufacturing, marketing, and research and development to allow the
organization to attain its goals.

Consistency across the three levels is important for success. Functional strategies should be
consistent with divisional goals while business goals should in turn be consistent with corporate
strategies.

Strategic planning
Strategic planning is the formalized long-range planning process used to define and achieve
organizational goals. It involves: selecting an organizational goal, determining the policies and
strategic programmes necessary to achieve specific objectives, establishing the methods
necessary to ensure that policies and strategic programmes are implemented. A vital component
in strategic planning is organizational goals. They provide a sense of direction for organizational
activities. Goal includes purpose, mission and objectives.
Purpose is the primary role of an organization as defined by the society in which it operates. It is
a broad aim that applies not only to a given organization but to all organizations of its type in that
society. For example, the purpose of all hospitals is to provide healthcare.

Mission is that unique aim that sets the organization apart from others of its type. Although the
purpose of all hospitals is the same, individually, they have different missions.

Objective is the target that must be reached if the organization is to achieve its goals. They are
the translation of its mission into specific corporate terms against which results can be measured.

Strategy refers to the pattern of the organizations response to its environment over time. Thus it
is a broad programme for achieving the organizations objectives and thus implementation of its
vision.

Characteristics of strategic plans

- deals with fundamentals of basic problems by providing answers questions such as: what
business should we be in? who are our customers or who should they be?
- Provides the basis for detailed planning and the day to day managerial decisions
- Involves a longer time-frame than other forms of planning
- It is a top management activity as they have the information necessary for strategic
decisions
- Helps integrate and unify the actions of the organization over time
- It provides guidance and boundaries for potential planning

Why organizations employ strategic planning

- Managers find that the definition of the mission of their organizations in specific terms
through strategic planning gives their organization direction and purpose
- It results in better functioning of the organization because it helps managers develop a
clear cut concept of their organization making it possible to formulate plans and activities
that bring the organization closer to its goals
- It helps managers to prepare for and respond to the increasing complex and dynamic
environment. They are able to anticipate changes in the environment and prepare for
them. Such changes include: technological change; growing complexity of managerial
jobs; complex external environment (politics, culture, society etc); time lag between
current decisions and their future results etc. With all these changes managers cannot
afford to take a short-term perspective of their organization. They need to look more into
the future and integrate it with the present if their organizations are going to survive.

Steps in Planning
1) Being aware of opportunities.
 Ability to see clearly future opportunities, and have knowledge of own strengths and
weaknesses.
 Panning requires realistic diagnosis of the opportunity situation.

2) Establishing objectives
 Involves specifying expected results

3) Premising.
Premises are planning assumptions which form the context in which planning takes place.
 Planning premises set the parameters or boundaries within which realistic goals can
be formulated.
 It means the org. cannot set goals and make goals that are unattainable in terms of the
environment and resources at the disposal of the org.

Planning premises are derived from the:

 Purpose of the Org.
 Mission
 Business environment
 Management values – which determine the organizational commitment to
social responsibility
 Experience of management.

4) Determining alternative courses of action.

 Involves search and examination of alternative courses of action.
 Alternatives are many but they have to be reduced and analyzed until only
a few promising ones remain. (Plan A versus Plan B)

5) Evaluating alternative courses of action.

 Involves weighing the strengths and weaknesses of a plan against set

objectives.
 Evaluation is in terms of risk, profitability, returns, costs, technology,
image etc.
 Evaluation is difficult because of the many variables that can influence a
plan.

6) Selecting a course of action.

 This is the point at which a plan is adopted.
 It is the point of decision making on which alternative to follow.
 7) Formulating derivative plans.

 Once a decision is made and a course of action taken, derivative plans are
required to support the basic plan. E.g. KQ decides to acquire a new fleet,
hence derivative plans would be needed for expansion of runways, hiring
and training new pilots, crew, acquisition of spare parts, scheduling and
advertising, insurance etc.

8) Numbering plans by budgeting.

 After decisions are made and plans set, they have to be given meaning.
 Done by converting the plans into budgets representing income and
expenses, profit and losses, etc.
 Budgets are an important of measure and control of plans.

Planning is a rational, systematic approach to accomplishing an

objective.

EFFECTIVE PLANNING

Lack of effective planning is the major cause of many management failures.

Organizational Objectives and Plans

These are important because they:
 Serve as reference points for the efforts of the organization.
 Necessary for coordination.
 Good for effective competition and growth.
 Objectives are prerequisites to determining effective policies, procedures, strategies and
rules.
 Defines the destination of the organization- where it wants to go.
 Analogous to a star/compass used by ships for navigation.

Other advantages

 Objectives encourage members to work towards the same goal thus reducing conflict.
 Gives an objective yardstick for measuring, comparing and evaluating performance.
  Provides rational bases for settling disputes.
 A good motivator as individuals are able to link performance and personal goals with the
work of organization.

THE ROLE OF OBJECTIVE/GOAL FORMULATION IN PLANNING

Objectives are the ends towards which organizations and individual activities are
directed. Objectives are usually supported by sub objectives – hence a hierarchy of
objectives.

EXAMPLE

Relationship between objectives and org. hierarchy (A dairy processing

organization)

1. Socio economic purpose and mission

Supply healthy milk products to all parts of Kenya

2. Overall objective
Gain 50% of market share

3. Specific overall objectives

Process one ml litres/year

4. Division objectives
Produce One ml. Kg. Of butter per month

5. Dept and Unit objectives[

Produce x units per day

6. Individual objectives on performance and

Personal development.

Produce x units per hour with 2% wastage

Objectives are interdependent and interlinked with plans. They also do not work linearly
but in a network. It is possible for a manager to pursue more than one objective at any one time
but must have the ability and skill to prioritize so that minor objectives do not overshadow major
and more important objectives. E.g. attending meetings at the expense of answering
correspondence – Many objectives can be accomplished by delegating to subordinate.

Goal Setting Technique

Management By Objectives (MBO)

MBO owes its importance to Peter Drucker (1954). He emphasized the importance of setting
objectives in all areas where performance affects the survival of an enterprise.

- In 1957, Douglas McGregor suggested a new approach to performance appraisal

based on the MBO concept.
- Research has shown that specific objectives are related to higher performances as
in studies on goal setting by individuals.
- Goal setting is an element in employee motivation.

Definition.

MBO is a comprehensive managerial system that integrates many key managerial activities in a
systematic manner, consciously directed towards the effective and efficient achievement of
Organization and individual objectives.

MBO – is a technique designed to achieve the integration of individual and organizational goals.

The process of MBO involves: -

1. Planning premises should have support of top management and subordinates should
understand the process.

2. Subordinates should have clear understanding of Org. purpose, mission, goals and
strategies.

3. Initial discussion between managers and subordinates to formulate goals.

4. Check points established to measure progress.

5. Evaluation of degree of goal attainment to analyze results achieved.

Benefits of MBO.

1. Better managing – MBO forces managers to think of planning for results rather than
merely planning for activities.
 e.g. on communication, good objective would be “to issue a two page newsletter
“beginning April 1, 2002 to all employees”.

2. Clarify organization roles and structures. Forces managers to make use of the people
around them through delegation, decentralization to work e.t.c.

3. Encourages personal commitment:

a. Clearly defined objectives encourage commitment as people know exactly what is

expected from them.
b. People become masters of their own fate.

4. Development of effective controls.

Involves measuring results and taking action to correct deviations from plans to
ensure goals are reached.

5. Improved communication because of the process of goal discussion between managers

and subordinates.

Weaknesses of MBO.

1) Failure to teach the philosophy of MBO.

Not all managers are familiar with MBO and may not be able to explain it to
subordinates.

2) Failure to give guidelines to goal-setters.

Cannot work if Org. goals, mission and purpose are not clear to the managers who are
expected to implement MBO. Managers need planning premises – i.e. assumptions as
to the future, knowledge of major Org. policies.
3) Difficulty of setting goals.
Goal setting can be technical and complex, requires thorough knowledge and study.

4) Dangers of inflexibility.
Managers are reluctant to change objectives or allow subordinates to change them due
to obsolescence.

CASE STUDY
Adored No More
Two years ago, Hoechst was one of Germany’s most watched companies. Harvard-educated boss, Jurgen
Dormann was loudly preaching the value of American-style shareholder capitalism and promising to
apply them to the lumbering, 135-year-old chemical group after taking the helm in 1994, he announced a
huge restructuring programme, selling poorly performing or marginal parts of his empire, floating others
on the stock market, adopting transparent accounting standards and even forcing managers to hold
meetings and send memos in English. Hoechst, he used to say, needed “de-rusting and defrosting”. Many
Germans found this incendiary stuff. But investors loved it.
It now seems they were too quick to believe Mr. Dormann’s sermons. Formerly a Hoechst corporate
treasurer (and the first non-chemist to run the company), the new boss came to the top fizzing with bright
ideas. Noting how inefficient it was to have one huge firm whose stronger divisions cross-subsidized the
weaker ones, he vowed to split Hoechst into individual companies, each obliged to earn a return on its
capital, and each answerable to a central holding company. He also promised to move out of stodgy
commodity chemicals and into fashionable “life sciences” (drugs, agrichemicals, biotechnology and so
on). These grand schemes have proved tricky to put into practice.
A lean, ascetic man, Mr. Dormann gives the impression of polite frustration with the irrationality of the
world. Admittedly, his own experience outside Hoechst is limited: he joined the company at the age of 23.
unlike some of Germany’s other industrial modernizers, he has never been based abroad. Hoechst, he now
concedes, has a corporate culture more entrenched than that of almost any other German firm. Its
sprawling Frankfurt Headquarters resembles a small town, rather than the nerve center of a global
corporation. Most of the 20,000 people who work there joined when Hoechst was somewhere between a
university and a government department. Changing their ideas about costs, flexibility, performance and
profits was always going to be hard.
The bubble burst last March, when Mr. Dormann abruptly discarded his original plan to turn Hoechst into
a holding company. Citing lack of cash, he broke his promise to float its key pharmaceutical division,
Hoechst Marion Roussel (HMR), on the stock market. Since then, Hoechst’s profits have lagged dismally
behind those of its German rivals, BASF and Bayer. Measured against the world’s top ten pharmaceutical
companies, its shares have done badly in recent months. Mr. Dormann’s clumsiness in explaining what is
going on made matters worse. “I simply don’t trust that man anymore,” says one German fund manager.
All this is a shame. Hoechst’s initial sell-offs were spectacularly successful. But the momentum is
flagging. “The early divestures were the easy ones”, admits Mr. Dormann. The Hoechst portfolio remains
cluttered with sluggish subsidiaries, producing fibres and specialty plastics. Finding buyers for these may
be tricky, although a week ago Mobil, an oil firm, announced plans for a plastic film joint venture with
Hoechst.
Then there are worries about those exciting life sciences. In particular the expensive centerpiece of Mr.
Dormann’s plan – creating a world-class drug company out of French and American acquisitions, plus
Germany’s pill makers – is proving tough. Researchers in Frankfurt, fearing that their jobs might be lost
to lower-cost laboratories in America, are not co-operating with their American colleagues. The
announcement of 600 layoffs in Germany sparked the biggest workers’ protest in the history of the
company. Hoechst’s agrichemical business, AgrEvo (a joint venture with Schering, a Berlin-based
pharmaceutical company) looks more promising – but will probably have to make an acquisition to keep
ahead in plant genetics.
Mr. Dormann faces a difficulty. Eager to soothe jangled German nerves, he rules out firing workers,
insisting that Hoechst will honour its “social responsibilities”. This is not enough to reassure trade unions,
who still see him as a heartless apostle of alien ideas. But nor does it please investors, who worry that
Hoechst still behaves like a German company, rather than an international company.
Mr. Dormann would probably be in less trouble with investors if he had not promised so much in the first
place. “Our experience in managing expectations is pretty new,” he concedes. This is a serious failing.
Other German firms, such as Veba (an energy and chemical conglomerate) have maintained credibility
with fund managers by promising less. Its senior managers emphasize that change will come gradually.
Big transformations take time.
REQUIRED: 1) Identify Mr. Dormanns problem(s) at Hoechst
2) State why you think his plans did not have the desired outcomes

Barriers to effective planning

Plans sometimes fail because of:-

1. Lack of commitment to planning.

Results in fighting fires, meeting crises e.t.c. Management by crises.

2. Confusion of planning studies with plans.

Having plans without decision are just planning decisions – shelved.

3. Failure to develop and implement sound strategies.

Fear of failure.

4. Lack of meaningful objectives and goals.

Are goals clear, can they be accomplished and are they actionable?

5. Tendency to underestimate the importance of planning premises – by ignoring the

environment.

6. Failure to see the scope of plans i.e. neglecting other types of plans e.g. strategies,
policies, rules e.t.c.

7. Failure to see planning as a rational process.

8. Excessive reliance on experience the past is not the same as the future.

9. Lack of top right support.

10. Lack of clear delegation.

11. Lack of adequate control techniques and information – need for feedback and evaluation.

12. Resistance to change.

13. Time consuming and expensive. Planning is hence neglected in favour of short-term
activities.
Avoiding barriers to planning
1. Start at the top – to ensure commitment top managers should set the goals and strategies
that lower level managers will follow
2. Planners should recognize limits – no planning system is perfect
3. Communication – vertical communication within the organizational hierarchy
4. Participation – involvement leads to motivation and ownership of the plans
6. Integration – of the long-term, intermediate and short-range plans must be properly
integrated for effective overall planning
7. Contingency planning – develop alternative plans of action if conditions change
8. Planning must not be left to chance
9. Planning must be organized
10. Goals, strategies and policies must be communicated clearly
11. Planning must include awareness and acceptance of change
 LECTURE FOUR
ORGANIZING

Lecture outline

4.1 Introduction
4.2 Lecture objectives
4.3 Principles of organizational design
4.4 Departmentalization
4.5Delegation
4.6 Line and staff functions
4.7 Span of control
4.8 Summary

4.1 Introduction

Organizing is the second function of management.

4.2 Lecture objectives

At the end of this lecture you should be able to do the following:
 Define the term organizing
 Describe the purpose of organizing
 Outline the basic principles of organizing
 Distinguish between the various types of organizational design
 State the factors influencing organizational design
 Explain the usefulness of organizational charts
 Discuss relationships between authority, power, accountability and responsibility in
relation to organizational hierarchy
 Explain the concepts of line and staff functions
 Discuss the significance of delegation as a managerial activity
 Explain the meaning and factors influencing span of control
 Discuss the influence of the environment on the structure of organizations
 Case study
Njoroge saved some money and with the help of his parents opened a small vegetable
shop in the nearby shopping center. Njoroge worked very hard and soon he had regular
customers coming to buy their weekly supply of vegetables and fruits from his grocery.
He went to the wholesale market every morning to buy his fresh produce then he loaded
his little truck and headed back to his grocery to unpack the fruit and vegetables, clean
the shop and does some bookkeeping before the shop started to get busy. Njoroge also
wanted to attract working women to his grocery and therefore he closed his shop at
9.00pm on weekdays. Although his shop did well and Njoroge could start paying back the
money he owed his parents he was always tired. He also found the bookkeeping hard to
do especially at the end of the month when there were always so many other things to do.
Eventually Njoroge decided to hire an assistant to help in the shop and also a bookkeeper
working half-day.


 List all the tasks that Njoroge had to do when he first opened his grocery. Is a
structure necessary?
 Draw a diagram to illustrate how the different tasks at the shop were divided
among Njoroge, the assistant and the bookkeeper. In your diagram show who
is reporting to whom.

This simple activity illustrates the concept of organizing

DEFINITIONS OF TERMS

Organizing is the managerial function of designing and maintaining a system of roles. An

organizational role must include: objectives; major activities of role; authority; availability of
necessary information and other resources.

Organizing: is the process of creating a structure for the organization that will enable the various
players to work together effectively towards its objectives.
Organizational structure: is the basic framework of formal relationships among responsibilities,
tasks and people in the organization. It can be seen as the division of activities into manageable
units where everyone knows who is to do what and who is responsible – it removes confusion
and conflict.
Organizational design: design of an organizational structure involves the task of dividing up the
work, allocating responsibility and establishing chains of command.
Organizational Chart: Is a diagrammatic explanation of an organization’s structure. It depicts
the organization as a whole, the various components and their interrelationships. It can be
compared to a road map – thus a chart is not the organization, but a representation of it.

Reasons for organizing

 Organizing is necessary to avoid confusion of roles, tasks etc.

 Organizing clarifies the responsibilities of the employees of the organization
 It allocates accountability to each employee for the outcomes of the work they are
responsible for
 It establishes clear channels of communication
 It enables managers to deploy resources (human, financial, informational, and physical)
meaningfully and synergy can be reached
 It enables monitoring of organizational activities
 Allows for co-ordination of different parts of the organization and different areas of work
 It provides the flexibility needed to respond to future demands and developments

ORGANIZATIONAL DESIGN
Organizational design is the decision-making process through which managers construct an
organizational structure appropriate to the plans and strategies of the organization.

Steps in organizational design are:

 Reflecting on the plans and objectives of the organization
 Establishing major tasks
 Dividing the major tasks into sub-tasks
 Allocating resources for sub-tasks
 Evaluating the results of the organizing strategy

Basic principles of organizing

Effective organizations are guided by the following principles:
 Division of work and specialization – involves dividing total workload into tasks
that can be logically and effectively performed by individuals with specialized
knowledge
 Departmentation – refers to the logical grouping into manageable sizes of
organizational activities belonging together. The departments created constitute the
organization’s structure and appear on the organizational chart. (A department is a
 distinct area, division or branch over which a manager has authority over
performance e.g. production, accounts or sales)
 Coordination - the process of integrating departments both horizontally and
vertically. It is achieved through authority relationships, which involve allocation of
responsibility and authority to each position in the organizational structure.
 Chain of command – defines the reporting lines of individuals and groups in the
organizations
 Unity of command – implies that each subordinate must have only one manager to
report to
 Span of control – refers to the number of subordinates working under one manager

THE ORGANIZING PROCESS

Organizing creates a vertical hierarchy of positions, which involves structuring authority,
responsibility and accountability. The hierarchy is a channel or conduit through which authority,
power and accountability flow. While authority and power flow downwards, accountability flows
upward and responsibility rests with individuals.

Authority
It is the right to do something – it is the right of a manager to make a subordinate do something
in order to accomplish organizational goals. Managerial authority is the right to command others
by making decisions, assigning tasks to subordinates and expecting and requiring satisfactory
performance from subordinates. However, being able to enforce this right is a different matter.

Delegation of authority
This refers to the process by which a supervisor gives a subordinate the authority to do the
supervisors job. A manager, however, cannot delegate the functions of planning, organizing,
leading and control as this would lead to breakdown in organizational performance.

Power
While authority is the right to do something, power is the ability to do it. The sources of a
manager’s power are:
 Ability to give or withdraw rewards
 Ability to punish or threaten to punish
Power is subjective and is influenced by moral and ethical considerations. The perception that
people have about the power of another is more important than the actual power possessed.
People in authority sometimes bluff, pretending they have more power than they actually do.

Authority and power must be balanced to avoid conflict. Too much power leads to abuse while
less authority leads to ineffectiveness.

Responsibility
This is closely related to authority and power. It refers to the obligation to do something. It is the
duty to perform organizational tasks, functions etc. In formal organizations everyone has a
responsibility

Delegation of responsibility
Responsibility cannot be delegated. A supervisor’s responsibility is not diminished because of
delegation of authority to a subordinate. In fact, responsibility may increase because in addition
to ensuring that the delegated work is done, he has to supervise the subordinate. Whether a
manager does the work or chooses to delegate to a subordinate, he retains complete
responsibility for the accomplishment of the task.

Source of responsibility
Responsibility is created within a person when accepting an assignment together with the
appropriate responsibility. The act of responsibility is created internally when a person agrees to
perform a task. Refusal to be responsible for a task leads to disciplinary action or dismissal.
Responsibility is not a flow as in accountability and authority but is retained within the person
assigned. It is an internal obligation to perform tasks.
Accountability
In addition to personal responsibility to oneself, an employee is accountable to higher authority.
Accountability comes into being because the manager has a right to require an accounting for the
authority and power delegated and tasks assigned to a subordinate. The subordinate must
account/answer to the manager the stewardship of the power and authority granted. “Each
employee is obliqued to report to his superiors how well he has exercised his responsibility and
the use of the authority delegated to them”

Just as a manager cannot reduce responsibility by delegating, accountability cannot also be

reduced.

Problems with imbalance between authority, power, responsibility and accountability

For the sake of organizational stability there must be equilibrium between the above four factors.
 If authority and power exceed responsibility and accountability there is likely to be
abuse of power. Power can be used arbitrarily with little regard on its impact on
others. It creates fear of the potential acts of the holder of excessive authority e.g. a
dictatorship form of government or the police.
 If responsibility and accountability exceeds authority and power, then people would
be held accountable for actions beyond their control. People will eventually object
and seek additional authority.

DEPARTMENTALIZATION
Departmental specialization can take many forms such as functional, product, geographical or
matrix designs.
What are the advantages and disadvantages of each design? What factors would organizations
consider when choosing a particular design?
Functional design: Each major function reports to the CEO and other sub functions report to the
major functional heads. The idea is to group specialists with similar interests and training
together e.g. marketing, HRM, finance or IT. This is the most common design
Product design: this is common in organizations that deal in multiple products. It is a
modification of the functional design. Each major product or line is managed by an executive
who reports to the CEO. The product manager has control over the functions in his division such
as sales, marketing, HR and finance.
Geographical design: Where an organization operates in a wide geographical area, territorial
groupings are designed. A company’s activities are divided into regions with a manager for each
with a home office for coordinating the activities of the geographical units.
Customer design: Activities are structured to respond to specific groups of customers. For
example, the lending activities in banks that are tailored to meet the needs of different customers
say business/corporate clients, personal, mortgage or small business.
Matrix design: this involves a grid or matrix of authority flows. Authority flows both vertically
and horizontally while vertical authority is exercised by functional managers, horizontal
authority is vested in project managers so that some employees find themselves reporting to two
managers. Project managers have formal authority over budgetary funds, time and tasks.
Advantages
Matrix designs are useful when:
 The activity has a definite completion date
 Cost constraints are a critical factor
 Specialized skills are required for the completion of a project
 Activity is new or unfamiliar to the participants
 When a high degree of competence is required and flexibility is needed
 The need to share resources and reduce costs

Disadvantages
 Conflict over allocation of resources and division of authority
 Dilution of functional authority
 Divided loyalty for project teams
 It sacrifices the principle of unity of command

i) As a practicing manager, how would you justify the use of a matrix

design since it potentially violates the principle of unity of command?
ii) Identify the consequences of poorly designed organizational structures

NB: It is rare to find organizations that use only one of these designs. Most use combinations of
two or more forms.

THE PROCESS OF DELEGATION

Delegation is risky. Why are many managers reluctant to delegate full

authority? What kind of risks do you think they fear?

Delegation is the process by which managers assign a portion of their total workload to others. It
includes assigning formal authority and responsibility for completion of specific activities.
Why delegate?
 Get more work done
  Subordinates may have some unique expertise which the manager lacks
 Helps develop subordinates managerial skills
 Enhances prompt action
 Superiors can take higher level tasks
 Better decisions as they are made lower down where the problems are
What are the barriers to delegation?
 Reluctance/inability to delegate due to lack of planning what to and not to delegate
 Insecurity due to fear that subordinates may do better and threaten their positions
 Lack of confidence in the subordinate to do the job
 Reluctance by subordinate to accept delegation due to fear of failure, lack of rewards,
risk avoidance tendencies etc.
 Incompetent subordinates
Some guidelines to effective delegation
 Free communication to ensure subordinates understand their responsibility, authority and
accountability
 Balance responsibility and authority- give enough authority to achieve desired results
 Define the expected results clearly
 Evaluate the experience and competence of the subordinate before delegating
 Be flexible with delegation- modify, increase, decrease or withdraw
 Supportive managerial climate free from fear, frustration and threats
 Put in place checks and controls to ensure delegated authority is not abused

LINE AND STAFF RELATIONSHIPS

The concepts of line and staff can be viewed both as functions and as authority relationships.
Line functions: Refers to those functions that have direct responsibility for accomplishing the
objectives of the firm. The managers responsible are line managers and the others are line
employees.

Line authority: refers to the chain of command where line officials have authority over
subordinates e.g. a manager and a subordinate. This is exercised by all managers irrespective of
whether they are line or staff.

Staff functions: refer to those functions that support the line functions by providing expertise,
advice and support. Examples are HRM, finance or research and development
 What are some of the likely sources of conflict between line and staff
employees?

 Status conflict- who is more important or strategic to the organization than the other
in terms of contribution
 Failure to understand the line–staff roles - e.g. forcing policies that make the line to
feel that their authority to manage is being undermined
 Lack of clear responsibility between line and staff
 Staff see line management as resistant to attempts to provide assistance and guidance

NB: The distinction between a line manager and staff manager is not absolute. There is a fine
line between offering professional advice and giving instructions

CENTRALIZATION AND DECENTRALIZATION

This refers to the extent to which decision-making power and authority is dispersed to lower
levels. It also refers to the degree of delegation of duties, power and authority to lower levels of
an organization.

Centralization Decentralization
High degree of retention of duties, High degree of delegation of
power and authority by top duties, power and authority to
management lower levels of the organization
- suitable in stable environments - occurs when environment is
hence few people can make changing rapidly
decisions - top level managers are
- culture of control by top managers, comfortable with leadership styles
lack of training for people at lower - emphasizes delegation
levels - uniformity is not critical
- need for uniformity is crucial

What factors determine an organizations position on the decentralization-centralization

continuum?
 External environment – the greater the complexity and uncertainity, the greater the need
to decentralize
 Tradition – tendency to do things the way they have always been done
  The nature of the decision – the costlier and riskier they are, the greater the pressure to
centralize
 The abilities of lower level managers – the more qualified and competent they are the
greater the tendency for top management to take advantage of their talents by
decentralizing
 The size of the organization – large organizations tend to be more decentralized

SPAN OF CONTROL/MANAGEMENT
Span of control management refers to the number of subordinates who report directly to a given
superior. A manager’s ability to manage a larger number of subordinates is limited by time,
knowledge, energy, personality and the tasks. Research has shown that managers at the top can
handle up to four subordinates while the lower level can be as high as twenty.

Factors determining an effective span of control

 Subordinate training – level of knowledge and experience possessed to handle the job
 Degree of hazard or danger associated with the job
 Clarity of the delegation of authority in terms of scope
 Clarity of plans – clear policies, rules and procedures to guide decisions and reduce
supervision time
 Cost of possible mistakes to the individuals and to the organization
 Rate of change – change determines the degree of policy formulation and stability.
Stability is associated with wide spans of control e.g. catholic church and the reverse
is true.
 Extent to which the job is complex
 Communication techniques – written versus oral communication
 Number of levels in the organizational structure
 Level of technology
 Type of production system
 Physical dispersion of subordinates
 Availability of a set of standard procedures
 Similarity of tasks

Think of more factors that are likely to determine the span of control. What are
some of the problems associated with wide and narrow spans of control

COORDINATION
This is the process of linking the activities of the various departments of the organization.
Coordination is maintained through rules and procedures such as standard procedures.

Liason roles – act as a common point of contact e.g. a spokesperson who facilitates flow of
information between units.

Task force – involves representatives from various groups coming together to work on a
common project and dissolve thereafter.

LECTURE SIX
THE DIRECTING FUNCTION

Lecture outline

6.1 Introduction
6.2 Lecture objectives
6.3 Meaning of leadership
6.4 Types of leaders
6.5 Importance of leadership
6.6 Approaches to leadership styles
6.7 Contemporary leadership models
6.8 Summary

INTRODUCTION
The difference between successful and unsuccessful organizations is the presence or
absence of dynamic and effective leadership. The function of management is being
viewed as not simply a set of practices and policies, but a crucial component in the total
organization strategy. To play its role of enabling the organization gain and sustain
competitive advantage, all managers have to play a leadership role especially in the
present business environment which is getting increasingly flexible, innovative and
dynamic.

Leadership is a concept that has generated much interest among academics and practicing
managers, politicians and sociologists among others. In this lecture we shall examine
some key aspects of leadership. To do so the following set of objectives will be the main
focus.

Learning Objectives.
 Define and explain the meaning of leadership.
 Explain the nature and importance of leadership.
  Explain the difference between a leader and a manager
 Identify and distinguish among the various research approaches to leadership.
 Identify and discuss the various theories of leadership.
 Explain the importance of leadership styles to management.

WHAT IS LEADERSHIP ?
Leadership is an important aspect of management and the ability to lead is one of the
keys to being an effective manager. The difference between success and failure whether
in war, business, a protest movement or a soccer game can be attributed largely to
leadership.

A large number of definitions can be found in the literature e.g.

 Leadership is the art or process of influencing people so that they will strive willingly and
enthusiastically toward achievement of group goals.

 Leadership is the ability of management to induce subordinates to work towards group

goals with confidence and keenness.
 Leadership is the ability of a person to influence the thoughts and behaviour of others
towards the accomplishment of some goals or goal.
 In summary, leadership is:

 The activity of influencing people to strive willingly towards group objectives.

 The process of influencing the activities of an individual or group towards goal

achievement in a given situation.

 A process of giving purpose (meaningful directions) to collective effort and causing

willing effort to be expended to achieve such a purpose.

 Getting people to move in certain directions, make decisions and support paths they
would typically not have selected.

 The process of making sense of what people are doing together, so that they will
understand and be committed to the goal.

 The process of articulating visions, embodying values and creating the environment
within which things can be accomplished.

-Leadership is a process not an individual position.

-It involves a relationship between a leader and followers in a given situation.
-Leadership is a complex concept involving the leader, the followers and the
situation.
-Leadership consists of activities and is directional.

From the above definitions, we can say that managers lead by giving orders, handling
disputes, supervising, disciplining and taking steps to improve employee performance. In
so doing they use influence, power, authority, delegation of responsibility and be
accountable. It is these components of leadership that managers use to direct the actions
of their subordinates.

DIFFERENCE BETWEEN LEADERSHIP AND MANAGEMENT

Leadership and management are closely related activities but distinguishable. Leaders
and managers are not different people, but can be the same individual performing both
roles. In recent years, theorists and practitioners in management have noted that, “to
survive in the 21st century, organizations need a new generation of leaders, not
managers”.

The fundamental difference between leaders and managers is that a manager focuses on
the implementation of company policy while the leader tries to lead and inspire people to
do their best for the company. A leader tries to cultivate a sense of commitment to the
vision and mission of the company by inspiring the subordinates to willingly strive for
the achievement of organizational objectives. A manager on the other hand manages
employees by the power and authority delegated to him by his superiors. While leaders
strive to conquer the volatile, turbulent and ambiguous surroundings that seem to
conspire against business organizations, managers tend to surrender to them. In other
words while managers administer, control, and accept the status quo, leaders innovate,
inspire and change the status quo.

From the foregoing it is obvious that to increase the performance of any

organization, all managers should also be good leaders. The goal of leadership studies
and leadership training is to turn managers into leaders so that they can become better
managers.

The Complementarity of management and leadership.

According to Brewster (1999), leadership and management qualities are complementary.

These characteristics may be summarized as follows.

Management characteristics Leadership Characteristics

 Administers and problem-solves.  Innovates- means alertness to

 Works within a system. opportunities, uses imagination
 Focuses on control. and vision to capitalize on them.
 Short range view.  Works on the system
 Accepts the status quo.  focuses on people.
 Sets things in motion by means  Inspires trust.
of methods and techniques.  Long range view.
 Attitude of doing.  Challenges the status quo.
 Is a natural unforced ability to
inspire people.
 Attitude of serving
 From the above characteristics, we can see that leadership is a broader
concept than management.

Effective Leadership.

To be effective, a leader must win the hearts and minds of the followers. This requires a
guiding vision and clear idea of what is to be accomplished. Effective leaders must be
able to communicate their vision. Knowing what to do, but not being able to
communicate this to others can be a major drawback to effective leadership.

 Communication means understanding each other as individuals and as members of larger

groups.

 Often communication is not effective because of barriers such as poor communication

skills, distortion or omission of information, wrong interpretation and lack of trust
between the sender and the recipient.

 Successful organizations are associated with leaders who are able to communicate
effectively their vision and strategy.

TYPES OF LEADERS.

Writers identify various types of leaders.

Charismatic Leaders – These are those whose influence is derived form the personality
e.g. Napoleon, Kenyatta, Billy Graham, Nelson Mandela, Desmond Tutu etc. This type
resides only in a few people and cannot be acquired by training – it is natural.

Traditional Leaders –These are those whose position is assured by birth e.g. Kings,
Queens, tribal chieftains etc. It is limited and not applicable to workplaces except in
family businesses.

Situational Leaders -Their influence is effective by being in the right place at the right
time – It is impromptu and temporary eg. One who steps to direct traffic in a jam.

Appointed Leaders –Refers to those whose influence arises from position e.g. managers
and supervisors. It is a bureaucratic type of leadership where legitimate power
comes from the position in the hierarchy.

Functional Leaders – Are those whose influence comes from the work done rather than
position such as experts.
LEADERSHIP AND POWER

The concepts of leadership and power are closely related.

Power is the capacity to influence others through the control of instruments of reward and
punishment – which can be tangible or intangible. Sources of Power are:

(vi) Legitimate power – derived from the position e.g. kingship, managerial
(vii) Reward Power – derived from control of resources e.g. promotion,
recommendation, training etc
(viii) Referent power– derived from association with powerful people
(ix) Coercive power – uses the ability to force other people to act against their
wishes through the fear of punishment.
(x) Expert power – derived from the possession of expert knowledge or
information that others need but have no alternative access.

IMPORTANCE OF LEADERSHIP

Leadership is important as it can make a difference to organizational performance.

Leadership provides the spark that can raise morale of employees. Peter F. Drucker noted
that:
“Leadership is a human characteristic which lifts a person’s vision to highest
heights, raises performance to higher standards and builds personality beyond its
normal situations”.

Leadership can be said to be important in the following ways:

1) Leaders not only guide, but provide a psychological shield to their followers (Managers –
employees) as the average person prefers to be led by an efficient and effective leader.
The presence of a leader (manager), makes followers (subordinates) behaviour consistent,
and raises morale, thus high quality of work.

2) Creates and sustains teamwork and groups. The will to work and accomplish a task is
triggered by effective leadership. Usually without leadership, a group disintegrates,
destroys its team spirit and fritters away its energy. Leadership inspires and motivates the
group.

3) Leaders are role models who set examples.

4) Leaders create confidence in the workers.

5) Promotes morale which leads to high productivity and organizational stability.

6) Maintains unity and cohesiveness of the group.

7) Maintains discipline of the group and among group members.

APPROACHES TO LEADERSHIP STUDIES

Three approaches have been used in the study of leadership. These are:

(i) Trait
(ii) Behavioural
(iii) Situational/contingency

(i) Trait Approach

The earliest studies on leadership focused on the qualities of effective leaders such as
bravery, loyalty, honesty, and compassion. However, as traits are many, research findings
often disagreed on which are the most important traits. Keith Davis (1972), in human
behaviour at work, summarized the traits and gave four general characteristics namely:-

(i) Intelligence – leaders tend to have higher intelligence than their followers.
(ii) Social maturity and breadth – leaders tend to be emotionally mature and have
broad range of interests.
(iii) Inner motivation and achievement drives – leaders want to accomplish things,
achieve goals and are intrinsically motivated.
(iv) Human Relations attitudes - leaders are able to work with others, and tend to
respect others.

NB: Not all leaders have these traits, and followers can also have them (they are not
exclusive to leaders). Although positive correlations have been found between the above
traits and effective leaders, examples of effective leaders exist who do have these traits.

The trait approach was used before 1949, when the ‘Great Man’ theory of ‘leaders are
born not made’, a belief originating from the Greeks and Romans was in vogue.
However, this school of thought was no longer acceptable after the rising influence of the
behaviourist school of Psychology which emphasized that people are not born with traits,
but made.

Criticisms of the Trait Approach

- Not all leaders possess all the traits.
- Many non-leaders possess most of the traits.
- The trait approach gives no guidance as to how much of any trait a person
should have.
- Research findings do not agree as to which are leadership traits and what their
relationships are to instances of leadership.
- The so called traits are nothing but patterns of behaviour.
 (ii) Behaviourist Approach

As a result of the failure of the trait approach to leadership, the focus shifted on the
individual behaviours of leaders. The main concern was on the leadership styles of
leaders. Leadership styles refer to the way a leader typically behaves towards his
followers/group members. These styles have been classified into:

(i) Autocratic Leadership – This approach refers to where all authority centers
around the leader. The manager enforces decisions by use of rewards and
punishments (ability to withhold or give rewards and punishment),
communication is in one direction - from manager to subordinate and conformity
and obedience on the part of followers is expected.

lea  One way communication

der  Compliance and obedience

Advantages:

 Decisions are made speedily as leader does not have to obtain group’s approval.
 Useful where decision is unfavourable.
 Useful in cases where followers are incompetent.

Disadvantages:

 Has negative effect on group morale – decisions may not be supported.

 Can create ‘yes’ mentality among group members.

(ii) Democratic/Participative Leadership.

 Considers the suggestions of members and leader. It is a human relations approach where
all group members are seen as important contributors to decision.

Democratic communication which allows an

interchange of ideas between all involved.
persons
leade
r

Advantages:

- increased morale of members.

- support for final decision.
- better decisions through shared ideas.

Disadvantages:

- Slower decision.
- Diluted accountability for decisions.
- Possible compromises designed to please all.

(iii) Laisser Faire Leadership

‘Allow (them) to do’ style – leadership exercises very little control or influence over group
members. Members are given a goal and left alone to decide how to achieve it. Role of leader is
facilitative.

lead
er

Advantages

 Increased opportunity for individual development.

 All persons are given a chance to express themselves and function independently.

Disadvantages

 Lack of group cohesion and unity toward org. goals.

  Lack of direction and control.
 Inefficiency and chaos.

WHICH IS THE BEST LEADERSHIP APPROACH?

It is not possible to say which style is best as it depends on the situation. A leader may be
autocratic in one situation and democratic in another.

LEADERSHIP STYLE THEORIES

There are several theories of leadership styles and a few will be considered in this lecture.

(i) Rensis Likert’s Systems of Management.

Likert developed four styles of management. As a proponent of participative management, he

saw the effective manager as strongly oriented to subordinates where all group members
including the manager adopt a supportive relationship. His four styles are based on differing
assumptions about human behaviour e.g. McGregor’s Theory X & Y.

System 1 Management Style: Exploitative – Authoritative

- Managers are highly autocratic.

- Have little trust in subordinate.
- Motivate people through fear and punishment.
- Engage only in downward communication.
- Limit decision making to the top.
- Relationships with subordinate are distant.

System 2 Management Style – Benevolent – Authoritative.

- Managers are paternalistic.

- Have a condescending confidence and trust in subordinates.
- Motivate with rewards and some fear and punishment.
- Limited upward communication.
- Limited delegation of decision making, but with close policy control.

System 3 Management Style – Consultative.

- decisions are made after discussion with subordinates.

- Substantial confidence and trust in subordinates.
- Managers try to make constructive use of subordinate’s ideas and opinions.
- Two way communication.
- Teamwork is encouraged and initiative
- Controls are much looser.
System 4 Management Style – Participative – Group System

- Most participative style.

- Complete trust and confidence in subordinates.
- Get economic rewards on basis of group participation.
- Communication is up, down and lateral.
- Encourage decision making at all levels.
- Excellent productivity, low absenteeism and turnover.

According to Likert, system 4 approach is the best. Leaders applying this

system have had greatest success, departments are most effective in setting and achieving goals.

Criticisms:

 Research focus was on small groups yet findings have been applied to the total
organization.
 Research was conducted at lower organizational levels and is not supported when data
from top level managers is separated.
 System 4 is more applicable when companies are profitable and not when in turbulence.

-The situation must be considered before making conclusion.

-System 1 and 2 are derived from the Scientific School of Management, while system 3 and 4
are developed form the Human Relations School of Thought.
-Management styles fall within a continuum ranging from total authoritarian to total
democratic.

(ii) The Managerial Grid

This is a dramatized approach to leadership styles developed by Robert Blake and Jane Mouton
in 1954 to show the importance of the manager’s concern for production and for people. The
managerial grid is widely used for managerial training and identifying leadership styles.
 9,9
1,9

5,5

9,1
1,1

Concern for production

The Grid Dimensions:

Concern for production conveys the attitudes managers have towards a variety of things e.g.:
Quality of policy decisions, procedures and processes, work efficiency, volume of output etc
Concern for people refers to degree of personal commitment toward goal achievement, self
esteem of workers, responsibility and recognition, trust rather than obedience, good working
conditions, satisfying interpersonal relations, job enrichment etc.

1.1 Management Style – (Impoverished Management).

- Managers have little concern for both people and production

- Job involvement is minimal
- The managers has practically abdicated the job and at best acts as a messenger
conveying information along the chain of command.
- It is basically an inefficient management style.

9.9 Management Style – (Team managers – executives).

- Possesses high concern for both people and production.

- Manager is able to integrate production needs and people needs
- It is considered the ideal or optimum style.

1.9 Management Style – (country club management or missionary).

- Has low concern for production and efficiency but emphasizes human relations
and pays attention to human needs.
 - Manager promotes an environment where everyone is happy, relaxed, and
friendly.
- No one is concerned about putting forth coordinated effort to accomplish
organization goals.

9.1 Management Style – (autocratic, task managers).

- Manager is concerned with developing efficient operations.

- Has little concern for human feelings.
- Manager is autocratic in leadership style.

5.5 Management Style – (Compromiser or benevolent autocratic)

- Manager has medium concern for people and production.

- Adequate but not outstanding morale and production.
- Manager has a benevolent – autocractic – paternalistic attitude towards people.
- Manager balances production and concern for people.

Criticisms of the management grid

- The grid does not say why a manager falls in one part of the grid and not
another.
- Or why one is an autocrat and not a compromiser.
(iii) Situational or Contingency Approaches to Leadership.
As a result of failure of the trait approaches, leadership studies turned to the study of situations
and the belief that leaders are the products of given situations. This approach supports the
follower theory that people follow those in whom they perceive (accurately or inaccurately) a
means of accomplishing their own goals. E.g. The rise of Hitler, Jomo Kenyatta, student leaders,
F.D. Roosevelt during the American great depression in the 1930’s. Museveni in Uganda in
1985-86, Corazon Aquino in the Philipines and Nelson Mandela.

Robert Tannenbaum and Warren Schmidt (1958) saw leadership as involving a variety of styles
ranging from boss-centered to subordinate-centered. Their approach suggests a range of styles
without preference for any.

The concept of the continuum recognizes that a style of leadership depends on the situation e.g.
(i) Forces operating within the manager’s personality such as value system,
confidence/trust in subordinates, feelings of security etc.
(ii) Forces in subordinates that will affect manager’s behaviour e.g. need for
independence, readiness to assume responsibility for decision making, tolerance
for ambiquity, interest in problem, understanding goals of organization,
knowledge and experience levels, sharing decisions.
(iii) Forces in the situation e.g organization values and traditions, nature of the
problem, pressure of time, trade unions, civil rights etc.
(iv) Forces in the external environment: In a revised publication Tannebaum and
Schmidt, recognized the forces in the external environment such as government
 legislation, political, social awareness and economic considerations as having an
effect upon leadership style.

Manager’s therefore have to consider these forces before choosing an appropriate

management style.

Continuum of leadership style

Area of manager’s authority

Area of subordinate freedom

The continuum suggests 5 basic styles: Tell, sell, consult, join, delegate.

This approach emphasizes flexibility and sensitivity to the situation in which the leader and the
group find themselves.

Other variables in the situation are:

 The job, or tasks.

 Organizational environment.
 Characteristics of people/demographic differences.
 History/culture of the organization.
 The community in which the organization operates.
 Psychological climate of the group.
 Cultural influences.
  Time required to make decision.
 Nature of the decision/task.

Situation: circumstances/conditions under which a leader operates.

Condition: consists of anything that affects leadership.

CRITICAL DIMENSIONS OF THE LEADERSHIP SITUATION - FIEDLER F. E. (1967)

According to Fiedler, people become leaders because of various situational factors and the
interaction between leaders and the situation. He describes these as:

1. Position Power:-refers to the degree to which the power of the position enables group
members to comply with leader’s directions i.e. organizational authority.
A leader with position power can obtain better followership than one without.

2. Task Structure:- refers to the degree to which tasks are structural. Where tasks are
clear, the quality of performance can be easily controlled and group members held
responsible than where they are unclear.

3. Leader- member relations:- refers to the extent to which group members like and trust
the leader and are willing to follow. The better the relations, the easier it is for the leader
to exercise influence.

Based on the three dimensions, Fiedler postulated two styles of management – task
oriented and interpersonal relations oriented. Measures were carried out on these
elements using the least preferred coworker scale indicating a favourable or unfavourable
situation continuum.

Findings
 Favourable situation in which the leader has power, informal backing and a structured
task – then the group is ready to be directed.

 When leader position power is weak, task structure is unclear, and leader-member
relations are poor, the situation is unfavourable for the leader and a task-oriented
leader is most effective.

 Where the situation was moderately favourable – middle of the scale, then
interpersonal oriented leader was most effective.

Usefulness of Leadership Theories to Managers

 Participative/democratic styles of management are better than autocratic styles but

extremes are not effective thus the continuum.
 Autocratic styles of management allow employees to satisfy lower level needs
e.g. physiological, safety, but participative styles allow higher level needs to be
satisfied e.g. recognition, responsibility and self-actualization.

 In reality people prefer to have control over work they do and seek opportunities
to put into practice their ideas.

 Employees have valuable expertise, experience and initiative that is often

untapped by management.

 Appropriate training in leadership can change a manager’s style of management if

done early in the career. However, it is not easy as style is rooted in attitudes.
The most difficult to change is the authoritarian, task-centred manager.
Management can transfer such managers to an appropriate section to make full
use of their abilities or restructure the work to suit their styles.
 LECTURE SEVEN
MOTIVATION

Lecture outline

7.1 Introduction
7.2 Lecture objectives
7.3 Explain the meaning of motivation
7.4 Discuss the content and process theories of motivation
7.5 Illustrate the application of motivation theories in the workplace
7.6 Identify the challenges associated with employee motivation

7.1 Introduction

7.2 Lecture Objectives

At the end of this lecture you should be able to:
1. Define motivation
2. Explain the consequences of unsatisfied needs
3. Discuss the content and process theories of motivation
4. Illustrate the application of motivation theories to the workplace
5. Explain the challenges associated with employee motivation

The study of motivation is a search for answers about human nature. Motivation is:
 ‘a concern with why people do or refrain form doing something’;
 ‘an individual’s internal process that energizes, directs, and sustains behaviour’
 a personal force that causes one to behave in a certain way’.
 ‘the willingness to exert high levels of effort to reach or achieve a predetermined reward
or goal’.
 a force that kindles a burning desire for work or action and the readiness to work towards
a goal or satisfy a need.

Terms used in motivation

Motivators: These refer to those things which induce an individual to perform e.g. higher pay,
prestigious title, name tag, praise, recognition, responsibility etc – It can be tangible or
intangible. There are limitless ways in which managers can be innovative in the use of
motivators.

Satisfaction: Refers to the sense of contentment experienced when a need is satisfied.

Intrinsic motivation: Refers to self-generated factors that influence people to behave in a
certain way or to move in a particular direction. These factors may include responsibility, which
involves the feeling that work is important, freedom to act, scope to use and develop abilities,
interesting and challenging work and opportunities for advancement.

Extrinsic Motivation: Refers to what is done by others to motivate people. For example
rewards such as increased pay, praise, promotion and punishments such as disciplinary action,
withholding pay or criticisms.

Extrinsic motivators have short-term effects while intrinsic motivators which are more
concerned with the quality of working life are likely to have deeper and longer-term
effects because they are inherent in individuals and not imposed from outside.

Reward is the use of inducement in the form of money, promotion or security. It is a strong
motivator, which should not be overlooked by managers.

Punishment is the denial of a reward, use of threats and fear e.g. fear of loss of a job, loss of
income, reduction of bonus etc. Punishment is a strong motivator but not sustainable because:-
 It can give rise to defensive or retaliatory behaviour such as union organization, poor
quality work, indifference, dishonesty etc.
 It can create compliance from subordinates even for wrong decisions because managers
have the power of their positions to give or withhold rewards or impose penalties.

Reinforcement: Reinforcement suggests that success in achieving goals and rewards act as
positive incentives and reinforces successful behaviour which is repeated next time a similar
need emerges. The more powerful and frequent the reinforcement, the more likely it is that the
behaviour will be repeated until it becomes an unconscious reaction to an event. Conversely,
failures or punishments provide negative reinforcements, suggesting seeking alternative means
of achieving goals

Consequences of unsatisfied needs.

Some needs are impossible to satisfy and this may result in some types of negative behaviours.
Such irrational behaviours are as a result of failure to accomplish an individual goal.

 Aggression: This is destructive behaviour such as hostility (physical/verbal) and striking out.
The feelings of rage or hostility are directed against the person or object that is felt to be the
cause of the frustration. As it is not possible sometimes to attack the causes of frustration
directly people may look for scapegoats.
 Rationalization: Means making excuses such as blaming someone else for inability to
accomplish a goal e.g. “I was not even interested in it anyway”.

 Regression: Means not acting one’s age by resorting to immature acts e.g. unreasonable
complaining or crying. It relieves some of the tension, but has adverse effects on associates
e.g. a person kicking a car when it cannot start.

 Fixation: Occurs when a person exhibits the same behaviour pattern several times even
though the experience has shown that it can accomplish nothing. Research has shown that
frustration can maintain old and habitual responses and prevent the use of new and more
effective methods. Although habits can be broken when they bring no satisfaction or lead to
punishment, fixation actually becomes stronger under such circumstances, e.g. the inability
to accept change even when the facts show otherwise penalties even when they make the
situation worse.

 Resignation (apathy): occurs when people lose hope of accomplishing their goals and
withdraw from reality and the source of their frustration. Involves complete surrender and
borders on serious mental disorders. This phenomenon is characteristic of people in boring,
routine jobs, where they resign themselves to the fact that there is little hope for improvement
of their goals.

Why managers should understand human behaviour.

(i) Be able to explain the behaviour of their subordinates.
(ii) Knowledge will form the basis for people management activities such as
performance appraisal and disciplinary action.
(iii) Search for logic behind any behaviour though it may appear insane to the
manager.

THEORIES OF MOTIVATION

The theories of motivation can be classified into content and process theories.

Content or needs theories: These are the theories that focus explicitly on the content of
motivation in the form of fundamental human needs. They are more concerned with the
quantitative aspects of motivation i.e. what motivates people and what people seek in their work.
Examples:

 Maslow’s Hierarchy of needs theory

  Herzberg’s two-factor theory
 McClellands three basic needs

Process or contemporary theories of motivation: These are the theories which attempt to
develop understanding of the psychological processes involved in motivation. They are more
concerned with the qualitative aspects and the dynamics of motivation i.e. how people are
motivated and how rewards influence behaviour. They focus on the why and how of motivation.
Examples:
o Latham and Locke’s goal-directed theory
o Porter and Lawler’s expectancy theory
o Adams equity theory
o Bandura’s self-efficacy theory

Maslow’s Hierarchy of Needs (1943)

Maslow was a psychologist and his theory has found wide application in many fields including
management. He proposed that:
 Behaviours of human beings are motivated by needs.
 Individual needs can be classified into 5 broad categories.
 These 5 categories operate in a hierarchical manner, flowing from low
order to high order needs as shown below:

High order needs

Social status
Low order needs Safety needs

Physiological needs

Physiological, safety and social needs are referred to as lower order or deficiency needs, because
the absence of them make individuals deficient and existence as a human being is threatened. On
the other hand, esteem and self-actualization are referred to as high order needs or growth needs
as these make an individual become better at doing what they are expected to do: gain control
and mastery over their environment in terms of technology, services etc.
Maslow’s theory of motivation therefore states that: “when a lower order need is satisfied, the
next highest becomes dominant and the individuals attention is turned to satisfying this
higher need.” The most difficult need to satisfy is that of self-fulfillment. Psychological
development takes place as people move up the hierarchy of needs, but not necessarily in a
straightforward progression. The lower needs still exist even if temporarily dormant as
motivators, and individuals constantly return to previously satisfied needs.

The lowest unsatisfied need in the hierarchy is the one that motivates behaviour e.g. a deprived
individual without basic needs will be directed towards finding food. The need for safety is
dormant at that time. A satisfied need does not motivate behaviour. Once satisfied, it ceases to be
a motivator, instead the next higher level need becomes active and motivates behaviour.

Application of Maslow’s Hierarchy of Needs Theory.

Physiological needs : Involves mainly payment of wages and salaries to enable people pay for
their basic needs of food shelter and clothing.

Safety needs:. Provision of protective clothing, insurance and medical cover, pension schemes,
housing and transport (in relation to safety), and job security.

Social needs:. Promoting family feeling, intimacy and closeness, use of first names, to break
formality and reduce social distance, sharing facilities e.g. cafeterias, sports club etc, casual
dressing to identify with each other and recognition of trade unions.

Esteem needs: Supporting education, delegation of responsibility, titles and other status
symbols, fringe benefits e.g. Cars; bonus; shares; office size and equipment.

Self fulfillment needs: This is the apex of human needs and involves the need for realizing ones
potentialities, continued self-development, feelings of accomplishment and attainment and being
creative in the broadest sense possible. Organizations can facilitate and create an environment in
which individuals can realize their potentialities e.g. writing, inventions, occupying important
positions etc.

 There are limits to how much organizations can provide to meet these needs as
they are limited by resources
 Esteem needs are mainly applicable to managers as they sometimes make
important business deals informally through informal networks such as clubs. As
such, status symbols become important. It is also notable that as one moves up
the ladder, fewer people benefit.
Research findings have shown that:
 Managers generally have high order needs compared to those at lower levels.
 Employees in developed countries generally have higher order needs than those in
poor countries.

It appears, however, that Maslow never considered the above dimensions as he was concerned
with individual employees.
  Do employees in developed countries have higher order needs than those in poor
countries?
 Do managers have higher order needs compared to lower level employees?
Explain

Weaknesses of the need hierarchy theory

 The five categories of needs are not mutually exclusive

 The order in which the needs must be satisfied is not supported by real life
 situations.
 The model only applies to typical healthy people. A sick person is
 unlikely to be satisfied by basic social or self-esteem needs.
 Research conducted to test the model have not supported its assumptions and
predictions.
 Some of the basic concepts of the theory such as self-actualization are vague.

HERZBERG’S TWO-FACTOR THEORY OF MOTIVATION

Herzberg (1959) conducted a study, which focused on job satisfaction primarily to find out the
factors associated with job satisfaction. He collected data from a sample of 203 accountants and
engineers based in Pittsburg, USA.

From these findings he proposed that human beings have two basic needs;
 The need to avoid pain and survive.
 The need to grow, develop and learn.
He also found that factors associated with feelings of happiness or satisfaction were concerned
with the job itself while those associated with dissatisfaction were related to the environment in
which the job was done.

He came up with two sets of factors from which the theory was coined. Different
terminologies have been used to refer to this theory.
 Satisfaction-related factors

 Satisfiers
 Motivators Motivators
 Job content factors
 Intrinsic factors

Dissatisfaction related factors

 Dissatisfiers
 Hygiene factors Hygiene or maintenance
 Job Context factors
 Maintenance
 Extrinsic factors

Herzberg’s findings showed that motivation can be explained by two factors:

A group of needs which he called hygiene or maintenance needs as they serve to

remove dissatisfaction. They are related to the job context e.g.

 Supervision
 Company policy and administration.
 Peer relations
 Working conditions
 Status
 Job security
 Pay
 Status
 Job title
 Job security, etc

He explained that if these factors exist, then there is no dissatisfaction, if they do not then
dissatisfaction results, but they are not motivators as such.

A second group of needs he called satisfiers or motivators and these are related to the job
content. They tend to increase job satisfaction e.g.

 Achievement
 Recognition
 Work itself
 Responsibility
 Advancement
 Possibility of growth etc.
Application of Herzberg’s two-factor theory- Job enrichment and job enlargement

Herzberg suggested that jobs should be made more interesting and challenging so as to motivate
employees. A great deal of interest has been directed at job satisfaction over the last decades as a
popular technique for increasing employee’s motivation. The concept of job enrichment has
been found to provide employees with an opportunity to:

 Perform more challenging and meaningful work.

 Utilize knowledge and skills more fully.
 Assume more authority and responsibility for planning, organizing, directing and
controlling of work.
 Receive feedback on performance.
 Grow and develop

Principles of Job Enrichment.

 Removing controls while retaining accountability
 Giving a complete unit of work
 Giving more authority
 Giving regular feedback to employees
 Giving new, difficult and challenging tasks

This theory assumes that employees are only motivated by enriched jobs and that
every employee desires an enriched job.
 In your view are these assumptions true?
 What are the limitations of job enrichment as a motivator?

Limitations of Job Enrichment

Research findings have shown that not all employees are motivated by job enrichment as some:
 Are unable to tolerate responsibility.
 Dislike complex duties.
 Uncomfortable with group work.
 Dislike relearning new skills.
 Prefer security and stability.
 Uncomfortable with supervisory authority
 Skills are not adaptable.
 Prefer to quit their jobs.
 For organizations, enriched jobs may result in the following problems
 Supervisor’s roles may be reduced because of shared responsibility hence causing
dissatisfaction.
 Enriched jobs may increase pay dissatisfaction because of increased responsibility.
 Costs in terms of training and development, new technology and more equipment e.g.
computers may increase.
 Unions may oppose some job enrichment efforts for fear of loss of employment or
decreased membership due to reduced desire to join unions by satisfied employees.

Strengths of the two-factor theory

 Easy to comprehend.
 It was developed from an empirical study, hence has some validity.
 There are clear guidelines for applying it in the job setting.

Weaknesses
 It uses too many and confusing terminologies.
 The research instrument was defective.
 Motivators and hygiene factors are not mutually exclusive, but interdependent e.g. salary
can be both hygiene and a motivating factor.

Further research findings on job enrichment have shown that it is only those people
with a strong need for personal growth, power and achievement that job enrichment
will have some impact. For further reading, see the works of David McClelland and
Arch Patton.(Koontz, O’Donnel & Weihrich, Management-1984)

Comparison of Maslow’s Needs Hierarchy with

Herzberg’s Two-factor Theory.

Maslow’s needs theory and Herzberg’s two-factor theory are similar in many ways. The high
order needs of the need hierarchy represent motivators in Herzeberg’s theory, while lower order
needs are similar to Herzeberg’s hygiene factors.

Herzeberg’s two-factor theory Maslow’s hierarchy of needs

 Challenging work
 Achievement
 Growth in job Self-actualization
 Responsibility
  Advancement
 Recognition Esteem or ego
 Status

 Inter personal relations

 Company policy and administration Social
 Quality of supervision
 Working conditions
 Job security Safety/securirty
 Salary
 Personal life Physiological

PROCESS THEORIES OF MOTIVATION

Process theories of motivation were proposed as alternatives and to fill the gaps not explained by
the content theories. Process theories are more concerned with the cognitive antecedents that go
into the motivation process. This include: expectancy theory by Victor Vroom (1964) and the
Porter-Lawler Model (1968); Equity theory by Stacy Adams and Attribution theories and others.
In this section we shall only discuss a few of these.

Expectancy Theory of Motivation

Victor Vroom developed this theory in 1964 as an alternative to the content theories of
motivation. It refers to any situation or context where people have expectations from whatever
they do. It states that “motivated behaviour is increased if a person perceives a positive
relationship between effort and performance – i.e. the outcome.

Based on this theory, extrinsic financial motivation works only when if the link between effort
and reward is clear and the value of the reward is worth the effort.

Managerial Implications of Expectancy Theory

 Strengthen employees effort and performance expectations by providing resources such as
training, that enable employees to perform.
 Strengthen performance–outcome–rewards by linking performance with reward e.g. pay.
Managers should be consistent and transparent about criteria used for promotion.
 Match rewards with employee’s performances.
 Recognize employee’s ability and ensure that it is used optimally.
 Provide employees with opportunity to perform e.g. enabling environment, resources, etc.
 Develop appropriate procedures for evaluating employee performance by measuring actual
performance, aptitude and criteria for promotion.
Equity Theory of Motivation

This is a process theory advanced by Stacy Adams (1968). Equity refers to perception of
fairness and justice in the treatment of people. If people feel that they are not being treated
equitably, they feel aggrieved and this grief will affect their levels of motivation in different
ways.

In the workplace, employees compare themselves with their peers in terms of their contribution
to the organization and in relation to what they get from the organization. They compare their
ratio of inputs and outcomes with that of another person.

Inputs: refer to the contributions made by an individual e.g. effort – both physical and mental,
time, education, training, experience, loyalty, useful contacts age, gender etc..
Outcome: refers to what is received in return for effort e.g. salary, fringe benefits, travel
allowances, medical insurance cover, status symbols, autonomy, recognition, friendly
environment etc.

Examples of ratios of outcomes to inputs

(i) Outcomes of ‘A’ = Outcomes of ‘B Satisfaction

Inputs of ‘A’ Inputs of ‘B’ = (Equity)

(ii) Outcomes of ‘A’ < Outcomes of ‘B’ = Underpayment

Inputs of ‘A’ Inputs of ‘B’ (Inequity)

(iii) Outcomes of ‘A’ > Outcomes of ‘B’ = Overpayment

Inputs of ‘A’ Outcomes of ‘B’ (Inequity)

Reactions of ‘A’

 In situation (ii), ‘A’ will act on outcomes to restore equity i.e. where there is perception of
underpayment by stealing from the organization, taking kickbacks, undermining ‘B’,
joining trade unions or reducing effort.

 In (iii) ‘A’ will attempt to restore balance by decreasing or increasing effort, e.g. working
longer hours, producing quality work, being loyal and committed to organization etc, or
by rationalizing or justifying the higher outcomes on the basis of experience, educational
levels etc. (resorting to subjective distortion of ‘A’s or ‘B’s inputs).
 In situation (i), there is perception of equity, hence no problems.
 Equity is taken seriously by employees and management decisions and
actions must be seen to be fair
The striving to restore the outcome/input ratio to equity is used as the explanation of
work motivation.
Workers prefer equitable payment to over-payment. Research has shown workers on a
piece rate system who felt overpaid reduced their productivity to restore equity.

Goal Theory (Latham and Locke, 1979)

It states that motivation and performance are higher when:
 Individuals are set specific goals
 Goals are difficult but accepted
 There is feedback on performance

Goal theory is aligned to the concept of management by objectives (MBO) and it forms the
foundation for performance management process.

MOTIVATIONAL STRATEGIES AND CHALLENGES

(Further reading- Armstrong, 2001, page 168-169)

Strategies

Money: It is an important motivator as it reflects on other motivators e.g.

status, esteem, achievement etc. Hence it is complicated as it is entangled
with other needs.
 Money has symbolic power – its value comes from what it can buy.
 To increase the motivational value of money, an incentive plan/system should be
introduced, as the extra money is usually spent on high-value ‘extra’ items.
 Equitable salary structures in organizations lessens the importance of money as a
motivator, hence Herzberg’s contention that money is hygiene, not a motivator.

Positive reinforcement: This idea was advocated by B.F. Skinner. He suggests that individuals
can be motivated by designing their jobs well, praising good performance so that it can be
repeated and removing barriers to performance and good communication.

Participation: Having knowledge of what is happening and being asked to participate in solving
problems is motivating to employees as it appeals to the need for recognition, affiliation and
acceptance and it gives people a sense of accomplishment.

Job Enrichment: Involves making a job more challenging and important by increasing scope of
authority and responsibility. These can be achieved by:
  giving workers more say in deciding about work methods, task sequencing etc.
 encouraging subordinate participation and interaction among workers.
 Giving workers a feeling of personal responsibility for their tasks.
 Ensuring that people see the contribution of their tasks in the overall result.
 Giving feedback on performance.

Job enrichment appeals mainly to higher level needs such as status, esteem and
self-fulfillment.

Other strategies of motivation may include; promotion to higher responsibility, personal

interest by manager, status symbols, training and development, monitoring, leadership style
etc.

Negative reinforcement or punishment: These should be avoided as it has the tendency of

stimulating anger, hostility, aggression, and rebellion in workers. The motivational effects
are only short term.

In your view to what extent do you think money can be used as a motivator?

Challenges

Motivation is a psychological and a social process. Although the theoretical concepts appear
simple and straightforward, they are difficult to implement in real life because of the following:-

Differences among people: People differ in their expectations; hence require different types of
incentives. For example, while scientists, engineers and other professionals may have a stronger
need for achievement, managers and politicians have a stronger need for power. Needs also
differ because of demographic characteristics of employees such as gender, age, race, education,
personal ambition, cultural background, occupation etc.

Social and economic change: Changes that impact on people’s lifestyles, such as increased
education, tastes and preferences, cross-cultural interactions mean that motivating techniques
which worked a decade ago may not work today.
Employees’ personal problems: Motivation can be effective only to a limited extent as people
may have problems that are beyond management and cannot be solved by motivation.

Lack of resources: Organizations may be willing to motivate its employees, but may lack the
resources to do so. This is especially so for financial motivators.

Motivation is an internal instinct: motivation by nature is an internalized process that comes

from within the individual. Reinforcements are only needed to activate it. Thus a manager can
give only encourage it, but the actual and effective motivation will depend upon the internal will
of the employee.

Motivation is situation oriented: Variables in motivation situation are, the motivator, the
motivated, the motivational technique and the motivational circumstances all of which affect the
motivational outcome. To achieve a positive outcome, all four must be in congruence- which
almost impossible.

Given the complexity of motivation in the light of varying

personalities and situations it is clear that risks of failure exist when any group of
motivators are applied without taking into account all the variables.

Lecture summary

Human behaviour is complicated and must be looked upon as a system of variables and
interactions. Motivating factors do not exist in a vacuum. In an organization people operate in a
field of restraining and driving forces. The actual behaviour will depend on the strength of these
counteracting forces. Managers can improve productive effort by reducing restraining forces or
by strengthening driving forces. Individual desires are conditioned by physiological and cultural
needs and the organizational climate in which they operate. Climate may repress or arouse
motives.

Managers who, if effective would certainly also be leaders must respond to the motivational
needs of individuals by designing a climate that will arouse motivation. Managers can design an
environment for performance by setting goals, developing and communicating strategies and
making plans to achieve objectives. In short managers can motivate employees by carrying out
effectively their core functions of planning, organizing, leadership, control and staffing.
 LECTURE EIGHT
COMMUNICATION
Lecture outline

8.1 Introduction
8.2 Lecture objectives
8.3 Explain the meaning of communication
8.4Describe the process of communication
9.2 Discuss the importance of communication in organizations
9.3 Discuss the channels of communication
9.4 Explain the barriers to communication
8.9 Summary

8.1 Introduction

8.2 Lecture objectives:

At the end of this unit you should be able to:
 Explain the meaning of communication
 Describe the process of communication
 Discuss the importance of communication in organizations
 Discuss the channels of communication
 Explain the barriers to communication

8.3 The Meaning of Communication

Communication is a human skill and the ability to communicate effectively is one of the major
skills of a manager. According to research, managers spend between 70% - 90% of their
working hours in communication broken down as follows: 5% writing, 10% reading., 35%
talking, 50% listening. Such communication plays a vital role in managerial decision-making.
People often communicate through signals such as facial expressions, gestures etc.

Communication is a word derived from the Latin word ‘communis’, which literally means
‘common’, ‘to share’, ‘impart’, ‘convey’ or ‘transmit’. It is the process through which two or
more persons come to exchange ideas and understanding among themselves.

Communication is the sum of all the things one person does when he wants to create
understanding in the mind of another. It involves a continuous process of telling, listening and
understanding.
The word communication describes the process of conveying messages (facts, ideas, attitudes
and opinions) from one person to another so that they are understood.

Communication involves:
 More than one person.
 Deals with the transmission of both facts and feelings.
 Many media of communication.
 A continuous process.
 Depends upon proper understanding of message, and response.

Communication involves more than transmission and receipt of message. Correct interpretation
and understanding are more important. Hence the greater the degree of understanding, in the
communication, the more likelihood the human action intended will proceed in the desired
direction.

The Communication Process

The Shannon Weaver Model of Communication
This model was developed in electronic communications and has been adapted by
behavioural scientists very successfully to explain human communications.

Their model had five elements.

Noise zone

Source Transmission Signal Receiver Destination

Feedback

The communication process is dynamic rather than static. The relationships in the process are
continuous and flexible and are subject to change. It affects and is affected by many variables.
The communication process is often depicted as having the following elements.

SOURCE SENDER IDEAS ENCODING CHANNELS

RECEIVING DECODING
 FEEDBACK
Sender: The person who intends to make contact with the objective of passing information
and ideas to another Person.

Idea: The subject matter of communication e.g. an opinion, attitude, feelings, views,
orders, or suggestions.

Encoding: Since the subject matter of communication is abstract and intangible, its
transmission requires the use of symbols such as words, actions or pictures; conversion of
the subject into symbols is the process of Encoding.
Channel: Medium through which message is transmitted.
Receiver: The person to whom message is directed.
Decoding: The process by which the receiver converts the symbols received by the sender
to give meaning to the message.
Feedback: Process of ensuring that the receiver has received the message,
understood and interpreted it in the sense that the sender has meant.

TOPIC 2: IMPORTANCE AND GROWTH OF COMMUNICATION

Topic objectives:
At the end of this topic you should be able to:
 Explain the importance of communication to management
 Discuss the factors that have led to the growth of communication in organizations

The importance of communication in organizations, is well recognized, - “it serves as

the lubricant fostering the smooth operations of the management process”. Some of
the important reasons are:

Forms the basis for coordination

Increasingly large and complex organizations with high degree of specialization and
division of labour with large number of employees require effective coordination
which can only be achieved through communication.

Smooth working of the enterprise

Process of communication makes cooperative action of people possible. Without
communication organized activity ceases to exist.

Basis for Decision-making

Communication is the primary requirement for decision-making. In its absence, it
may not be possible to take any meaningful decision, as information must be received
before any decision can be made or implemented.

Increases managerial efficiency

 Communication is essential for quick and systematic performance of managerial
functions. Management conveys the goals, targets, instructions, job allocations and
responsibilities, and performance of subordinates through communication.

Promotion of cooperation and industrial peace

High productivity is the aim of management. This can only be achieved when there is
industrial peace in the organizations and mutual cooperation between management
and workers. Downward communication helps management tell workers their
expectations while upward communication helps workers put their grievances,
suggestions or reactions to management.

Establishment of effective leadership

Communication is the basis of direction and leadership. It is a process of influencing
others behaviour. By developing communications skills and using them, managers
become effective leaders.

Morale building and motivation

Communication is the basis of participative and democratic pattern of management.
It improves good human relations in industry. An efficient system of communication
enables management to change attitudes, motivate and build morale – hence
employee satisfaction.

Most of the conflicts in business are not basic, but are caused by misunderstood motives and
ignorance of the facts. Proper and timely communication between the interested parties, reduce
the points of friction and minimize those that are inevitable. Bernard Chester wrote. “The first
executive function is to develop and maintain a system of communication.”

Factors Responsible for Growing Importance of Communication

Growth in size of organizations

Complex and large organizations have several levels in the hierarchy, and many employees.
Direct contact is not possible, hence a communication system to direct all their activities.
Growth of trade unions
Cooperation between organizations and trade unions is essential for industrial peace. This
can only be achieved through an efficient communication system e.g. collective bargaining
process, negotiations etc.
Technological Developments
Rapid change in technology affects the composition of groups, relationships between
managers and subordinates, and methods of work. The necessary adjustments in the social,
organizational and physical aspects of work can only be possible through communication.
Emphasis of human relations in industry
 The growing importance of human relations in industry and the desire of management to
maintain it has necessitated communication. The change of employer relationship from
master-servant to partnership or associates helps in the attitude change process.
The work of research psychologists and sociologists
Their findings and conclusions have increased knowledge of the nature and process of
communication.

Activity: In what ways do you think lack of effective communication can be a

source of conflict between managers and employees?

CHANNELS OF COMMUNICATION
Topic objectives:
At the end of this topic you should be able to:
 State the major channels of communication
 Explain the advantages and disadvantages of the various channels of communication

Communication Channels
The major channels of communication are:
 Words
 Actions
 Pictures
 Numbers

Words.
Words are like a map that purports to represent a certain territory. The map is not the
territory but the representation and so are words. The meaning of a word is easy
when it represents a tangible object e.g. cup or book but more difficult when it refers
to abstract concepts such as management, labour, levels etc. People will assign
different meanings to the same word because they have different frames of reference
due to background, culture, education, experience or associates. Words constitute the
most important symbols in the communication process. They can be oral or written.
The important skills required are: Reading, writing, speaking and listening.

Verbal/Oral Communication
Refers to exchange of ideas between sender and receiver through oral words – face to
face or telephone, radio call e.t.c In Organizations this can take the form of;
personnel instructions, management conferences, interviews e.t.c.

Advantages.
 Easy to clarify a point.
 High degree of potential for speedy exchange of information – timely.
 Effective as can be used together with non-verbal communication e.g. gestures, guttural
sounds, tone of voice etc.
 Popular – preferred by managers and supervisors. Gives opportunity to employees to ask
questions and participate in the discussion – boosts morale.
 Disadvantages.
 Absence of any permanent record of communication.
 Not taken seriously by receiver hence objective of communication is not achieved.
 Possibility of misquoting or misinterpretation especially where relations may be strained
between superior and subordinate.

Written Communication
When communication is put in written form it becomes written communication. In
organizations, these appear in the form of; - letters, circulars newsletters, reports, budgets, rulers,
orders, regulations, policies, schedules, manual, etc. Includes other symbols such pictures,
graphs, charts etc

Advantages.
 Stored as record for future reference.
 Communication effort is minimized by simultaneous communication to various points e.g. a
circular to all employees.
 Enables communication between distantly placed parties without much cost.
 Orderly and binding on subordinates.
 Enable superiors to take suitable actions based on recorded communications.

Disadvantages.
 Time consuming in preparation and understanding (reading and interpreting).
 Chance of misunderstanding.
 Can be more costly than oral communication.

Actions
Actions can be used as a non-verbal form of communication e.g. body language,
facial expressions, gestures, tone of voice/pitch of voice, etc. It can also take the
form of physical actions such as location of one’s desk, removal of equipment or
furniture, searching drawers/opening ones cabinet/office, delays etc

A manager is the center of attention to subordinates. All observable acts

communicate something to the observer whether intended or not by the supervisor.
When unexplained actions by management occur, a vacuum of meaning is thereby
created which is filled by the receiver’s own interpretation of the actions. If an action
is not explained, the receiver will supply the missing signal by creating one of his
own.

Pictures
Pictures are powerful means of conveying meaning and understanding to other
people. This is demonstrated by cartoons, films, TV, photographs etc.

Important, accurate and comprehensive reports, have been given little attention
because of the complexities of reading, but the use of charts, graphs, posters etc. can
 convey more meaning sometimes than volumes of long, uninterrupted passages of
writing.

A chart or graph has the advantage of depicting many complex relationships in one
picture, contrasts, trends, etc can be seen and grasped more clearly.

Common Pictures in Business are: curves, bar graphs, columns, circles, pie charts,
pictorial, maps, organization charts, ranking and frequency distributions.

Numbers.
It has generally been found that people are impressed by numbers – figures and
statistics. Acceptance and belief – also confidence tend to rise for a report that has
data statistics e.g. percentages, proportions, etc. Numbers however can be
misleading as they can be manipulated by unscrupulous people. Skillful use of
numbers can be applied to lead or mislead.

Listening

Listening is the process of receiving communication signals. People speak at the rate
of 120-160 words per minute and the discrepancy between the speeds of speaking and
listening and thinking speed is four times faster i.e. 480-640 words per minute.
However, this is an obstacle to effective communication because:
o Leads the listener to only listen marginally/poorly.
o Fast thinking makes people think ahead on what they are going to reply.
o Listening is not passive but active.

Effective listening results in 50% retention immediately after a 10-minute talk,

and 25% decline after 48 hours.

Three types of listening have been identified.

 Marginal
 Evaluation
 Projective

Marginal
A process of giving the listener a small degree of one’s attention. It is dangerous as it
can lead to misunderstanding of the speaker and can be seen as an insult also.
Managers who pretend to listen while their minds are on other things eventually get
into trouble with their subordinates.

What are the likely repercussions of an unattentive manager?

Rebellion and low morale.
 Evaluative
Process of attentive listening, involves judging and evaluating the remarks,
disapproving or approving what is being said from our own point of view. This way
we have two ideas, the speakers and the listeners, neither of which is communicated
to the other. The task of understanding what the other is trying to say is not achieved.

Projective
The process of purposely avoiding to criticize, approve or disapprove the speakers
ideas. It is attempting to project oneself into the mind of the speaker and try to
understand their viewpoint without evaluation. As Carl Rogers puts it;
“Each person can speak for himself after restating the ideas and feeling of the
previous speakers accurately and to that speakers satisfaction”. E.g. what I hear you
say is ---------- is that correct. The quality of empathy is essential to good listening.

TOPIC 4: TYPES OF COMMUNICATION

Topic objectives:
At the end of this topic you should be able to:
 State the various types of communication
 Discuss the benefits and weaknesses of grapevine communication

Several types of communication can be identified in a business organization.

According to organizational structure.

Formal communication.
Associated with the formal organizational structure. Information travels through the
officially recognized positions in the organization chart. E.g. orders, instructions,
decisions, rules, procedures, policies etc maybe written or oral.

Informal communication
Also known as the ‘grapevine’. They are free from all sorts of formalities. Based on
friendship, membership of a group/club, or origin of place, e.g. opinions, views,
comments, suggestions, complaints, rumours, whispers, gossip etc may use symbols
such as glance, gestures, nod or silence, anonymous letters etc.

According to direction of communication.

Downward communication
Communications that flow from superiors to subordinates. Include orders,
instructions, ruled, policy directives etc. They are directive in nature.

Upward communication
Reverse of downward communication, flows form subordinates to superiors.
Includes reaction and suggestions from workers, grievances, and disputes. They
maybe in the form of reports, proposals, memorandums, etc. Upward communication
is now considered to be a main source of motivation.
 Horizontal communication
Refers to communication between persons at the same level in the management
hierarchy. Also known as lateral or cross-wise communication e.g. meeting of
general managers, Divisional heads etc. can be oral or written.

According to way of expressions

Oral/verbal communication.
Exchange of ideas/information occurs through face to face conversation or
mechanical media e.g. Telephone, loud speaker, radio call etc conferences, seminars,
workshops, interviews, consultations are other media.

Written communication.
Takes the written form (black & white) includes written words, pictures, graphs,
diagrams, maps, etc. They may take the form of circulars, personal letters, memos,
manuals, reports etc.

Grapevine Communication
The informal channel of communication is also known as the grapevine. It results
from the operation of social forces at the workplace. The term arose during the days
of the American Civil war when intelligence telephone lines were strung loosely from
tree to tree like grapevine plants and the message was usually distorted, hence any
rumour was popularly referred to as the grapevine. Today all types of informal
communication are referred to as the grapevine.

Although the grapevine exists outside the official network, it continuously interacts
with it.

Advantages.
-Operates with much greater speed than the formal communication network.

-Appropriate for some subject matters which do not require the formal channel e.g.
when management wants to sound out the feelings of employees before formalizing a
rule or policy.

-Satisfies the needs of persons who like to mix up with others freely and ‘chat’.

-Can compensate for an inadequate or non-existent formal communication network.

Disadvantages.
-Disorderly and unreliable hence cannot be acted on.
-Difficult to assign responsibility for false information as it is hard to pinpoint the
source.
-Negatively affect productivity as rumours can lower morale and much time is taken
in “rumour mongering”.

Evaluation of Communication Network.

There are several methods for evaluating the effectiveness of communication:
 Attitude surveys.
 Employee relations index – a measure of the smooth flow of
communication.
 Clarity – Fog index and reading ease – measures of readability and
understanding.
 Communication Audit- measures of information known to different
individuals.
 Records – safety, accidents and labour turnover may indicate
understanding of communication by employees.
 Observing practice

Activity: Using examples from an organization of your choice, explain some of the
ways in which the effectiveness of communication can be evaluated?

TOPIC 5: BARRIERS TO COMMUNICATION

Topic objectives:
At the end of this topic you should be able to:
 State the barriers to communication
 Discuss the obstacles to effective management in organizations

Communication does not always give the desired results due to certain barriers or
obstacles. These are classified as follows:

Semantic Barriers
These arise from the linguistic capacity of the parties e.g.

Badly expressed message – lack of clarity and precision, poorly chosen and
empty words, phrases, careless omission, lack of coherence, bad organization of
ideas, bad sentence structure, inadequate vocabulary, jargon, etc.

Faculty Translation – managers often receive communications from superiors

which must be translated into appropriate language suitable for lower levels of
employees e.g. policy decisions etc. If the translation is faulty or inaccurate, it is
misunderstood.

Unclarified assumptions – uncommunicated assumptions are common in most

messages, so others have to “read between the lines”.
Specialists language (jargon) – some groups eg. Legal, insurance or personnel
develop a special, peculiar and technical language of their own. This increases
their isolation thus building a communication barrier.

Emotional/psychological barriers.

The meaning ascribed to a message depends upon the emotional or psychological

status of the parties involved e.g.

Premature Evaluation – the tendency to evaluate (judge) communications

instead of being neutral during the interchange of ideas. Such evaluation
interferes with the transfer of information form the sender.
Inattention – the pre-occupied mind of the receiver and resultant non-listening
is a major chronic psychological barrier. It is the reason why people fail to
respond to notices, circulars, memos etc.
Loss by transmission and retention – when communication passes through
various levels in the organization, successive transmission of the same message
decreases accuracy. In oral communication about 30% of the message is lost.
Poor retention is also common. Employees retain about 50% of information
which superiors retain about 63%.
Undue reliance on the written word – written word cannot substitute for face-
to-face relationships. Employees do not accept management’s views through
publications unless level of trust and confidence is very high.
Distrust of Communication – arises out of illogical decisions or frequent
changes of the original communication by the communicator. Repeated
experience of this kind gradually conditions the receiver to delay action or to act
unenthusiastically, hence making communication unsuccessful.
Failure to communicate – managers may fail to transmit needed messages
because of laziness, procrastination, hoarding information to embarrass, or
assuming that everybody knows.

Organizational barriers.

Organizational Policy – general organizational policy regarding communication

acts as an overall guideline to all. However if the policy is not supportive to the
flow of communication in different directions, communication flow would not be
smooth and adequate.
Organizational rules regulations – These affact the flow of communication by
prescribing the subject matter to be communicated, the channel of
communication, restrictions on what and who to communicate, etc. These
specifications may cause delays and work against the willingness of persons to
convey the message.
Status Relationships – the superior – subordinate relationship may block
particularly upward communication. The greater the difference between
hierachical positions, the greater the possibility of communication breakdown.
Organizational facilities/communication infrastructure.
 Personal barriers.

Barriers in superior: e.g.

Attitude of superiors – this affects the flow of messages in different directions.
Unfavourable attitude means messages would not flow properly to and from
superiors/subordinates.
Fear of challenge to authority – superiors, when ambitious and want to maintain
their power and authority may withhold information coming down the line or going
up if it will expose their weaknesses.
Insistence on proper channel – in exercise their authority superiors insist on
communication passing through them. However, if by passed they may block other
communication as they see this as thwarting of their authority.
Lack of confidence in subordinates – generally, superiors perceive their
subordinates as less competent and incapable, hence their suggestions, advice etc are
ignored. This works against upward communication.
Ignoring communication – sometimes superiors consciously and deliberately ignore
communication from their subordinates to maintain their importance. This works
against the willingness of subordinates to communicate.
Lack of time – superiors feel whether correct or otherwise that their workload is
heavy and have little time to talk to subordinates.
Lack of awareness – superiors sometimes lack awareness about the significance and
usefulness of communication in different directions in general, hence blocking the
flow of communication.

Barriers in Subordinates: e.g.

Unwillingness to communicate – subordinates may feel that the information may

have adverse effect on their future relations with the superior, or there is no mutual
trust and confidence with superior etc. He would not be willing to communicate.
Lack of incentive

What do you think are some of the actions that a human resource
manager can take to overcome the obstacles to communication in an organization?

LECTURE TEN: GROUP DYNAMICS

10.1 Lecture outline
10.2 Introduction
10.3 Lecture objectives
10.4 Group processes
10.5 Formal and informal groups
10.6 Summary
 LECTURE ELEVEN:
ORGANIZATIONAL CHANGE AND DEVELOPMENT

Lecture outline

9.1 Introduction
9.2 Lecture objectives
9.3 Theories of change
9.4 Change management
9.5 Organizational development
9.6 Summary

9.1 Introduction
The concept of organizational change is in regard to organization-wide change, as opposed to
smaller changes such as adding a new person, modifying a program, etc. Examples of
organization-wide change might include a change in mission, restructuring operations (e.g.,
restructuring to self-managed teams, layoffs, etc.), new technologies, mergers, major
collaborations, "rightsizing", new programs such as Total Quality Management, re-engineering,
etc. (Armstrong P. 25) In this context managers have to be able to introduce and manage change
to ensure the organizational objectives of change are met, and they have to ensure that they gain
the commitment of their people, both during and after implementation. Often, at the same time,
they also have to ensure that business continues as usual. For these reasons, it is important that
the way change is managed is carefully considered by organizations. Whilst each change
situation will be unique, there are still a number of common themes that will help ensure that the
change process stands the greatest chance of success.

9.2 Lecture objectives

The different models of change
Much has been written on the subject of change, and various models of change proposed. Three
main, contrasting models are from Lewin and Beer and Shaw.

Lewin's model
This model considers that change involves a move from one static state via a state of activity to
another static status quo. Lewin specifically considers a three-stage process of managing
change: unfreezing, changing and re-freezing. The first stage involves creating a level of
dissatisfaction with the status quo, which creates conditions for change to be
implemented. The second stage requires organising and mobilising the resources required
to bring about the change. The third stage involves embedding the new ways of working
into the organisation. (Hayes p.56)

Beer's model
Beer and colleagues advocate a model that recognises that change is more complex and therefore
requires a more complex, albeit still uniform set of responses to ensure its effectiveness. They
prescribe a six-step process to achieve effective change. They concentrate on 'task alignment',
whereby employees' roles, responsibilities and relationships are seen as key to bring about
situations that enforce changed ways of thinking, attitudes and behaving. Their stages are:
 Mobilize commitment to change through joint diagnosis.
 Develop a shared vision of how to organise.
 Foster consensus, competence and commitment to shared vision.
 Spread the word about the change.
 Institutionalise the change through formal policies.
 Monitor and adjust as needed.

Shaw's model
This model looks at change in a different form. Change is seen as both complex and also
evolutionary. The starting point for their (and a number of other more recent models) model is
that the environment of an organisation is not in equilibrium. As such the change mechanisms
within organisations tend to be 'messy' and to a certain extent operate in reverse to the way
outlined by Lewin. It is not appropriate to consider the status quo as an appropriate starting point,
given that organisations are not static entities. Rather the forces for change are already inherent
in the system and emerge as the system adapts to its environment.
Resistance to change can be defined as an individual or group engaging in acts to block or
disrupt an attempt to introduce change. Resistance itself can take many different forms from
subtle undermining of change initiatives, withholding of information to active resistance e.g. via
strikes. Resistance to change can be considered along various dimensions:
 individual versus collective
 passive versus active
  direct versus indirect
 behavioural versus verbal or attitudinal
 Minor versus major.

Similarly two broad types of resistance can be considered:

 Resistance to the content of change - for example to a specific change in technology, to

the introduction of a particular reward system.
 Resistance to the process of change. This concerns the way a change is introduced rather
than the object of change per se, for example, management re-structure jobs, without
prior consultation of affected employees.

Management need to be aware of these different criteria to ensure they respond appropriately.

Suggested reasons for resistance include: loss of control, shock of new, uncertainty,
inconvenience, threat to status, competence fears. It is important to try to diagnose the cause of
employee resistance as this will help determine the focus of effort in trying to reduce/remove the
issue.

Change Management: Four Basic Strategies

These can be considered as the different strategies and procedures that are used to categorise the
change environment. The relevance of different change strategies is that they build upon different
assumptions about human motivation and hence willingness to engage in change at a particular
point in time. These strategies are not intended to be mutually exclusive. Rather they may each
be appropriate at a different stage of a particular change process. Once the environment is
identified, an effective implementation plan can be composed. (Molloy & Whittington pg. 52)

Strategy
Description

People are rational and will follow their self-interest — once it is

Rational-Empirical
revealed to them. Change is based on the communication of
information and the proffering of incentives.

People are social beings and will adhere to cultural norms and
Normative-Reductive
values. Change is based on redefining and reinterpreting existing
norms and values, and developing commitments to new ones.
Power-Coercive
People are basically compliant and will generally do what they
are told or can be made to do. Change is based on the exercise of
 authority and the imposition of sanctions.

People oppose loss and disruption but they adapt readily to new
Environmental-Adaptive circumstances. Change is based on building a new organization
and gradually transferring people from the old one to the new
one.

Individual change initiatives are not always undertaken as part of a wider coherent change plan,
for example through considering linkages between strategy, structure and systems issues.
Therefore a change that considers a new structure but fails to establish the need to introduce new
systems to support such a structure is less likely to succeed.

Lack of effective project management and programme management disciplines can lead to
slippages in timings, in achievement of desired outcomes, in ensuring that the projects do deliver
as planned.

Insufficient, relevant training, for example in project management, change management skills,
leadership skills can all impact negatively on the effectiveness of any change initiative.

Poor communication has been linked to issues surrounding the effectiveness of in achieving
effective change in various ways. For example, imposed change can lead to greater employee
resistance. Lack of effective leadership has been identified as an inhibitor of effective change.

What can be done to make change management more effective?

Effective leadership is a key enabler as it provides the vision and the rationale for change.
Different styles of leadership have been identified, for example coercive, directive, consultative
and collaborative. These different styles may each be appropriate depending on the type and
scale of change being undertaken. For example, when there is a large-scale organisation-wide
change a directive style has been identified as most effective.

Appropriate and timely training is frequently identified as key to effective change. Examples of
training requirements might include:

 project and programme management skills to ensure change initiatives are completed
both on time and to budget
 change management skills, including communication and facilitation
 Leadership and coaching.
Two-way communication with employees and their active involvement in implementation has
also been identified as a key enabler of change. Active participation is one suggested means of
overcoming resistance to change. However, research has indicated that part of the
communication/participation issue might arise from a potential mismatch between what the
employer and employee opinions are regarding levels of communication.

Finally, linking all the change agendas within an organization coherently, rather than completing
changes in isolation is vital to ensure that change effectiveness is maximised. Seven areas of
activity that make successful change happen - 'the seven c's of change':

 Choosing a team.
 Crafting the vision and the path.
 Connecting organization-wide change.
 Consulting stakeholders.
 Communicating.
 Coping with change.
 Capturing learning.

The best approaches to address resistances are through increased and sustained communications
and education. A plan should be developed and communicated. Plans do change. That's fine, but
communicate that the plan has changed and why. Forums should be held for organization
members to express their ideas for the plan. They should be able to express their concerns and
frustrations as well.( Kinnie & Rabinowitz 2007)

Human Resource Role in change management

People management and development professionals have significant role to play in any change
management process. Human Resource’s involvement in certain areas was identified as
sometimes being the difference between successful and less successful projects:
 Involvement at the initial stage in the project team.
 Advising project leaders in skills available within the organisation – identifying any skills
gaps, training needs, new posts, new working practices etc.
 Balancing out the narrow/short-term goals with broader strategic needs.
 Assessing the impact of change in one area/department/site on another part of the
organisation.
 Being used to negotiating and engaging across various stakeholders.
 Understanding stakeholder concerns to anticipate problems.
 Understanding the appropriate medium of communication to reach various groups.
 Helping people cope with change, performance management and motivation.
 Organizational change is increasing, yet the high level of failure indicates that effective
management of these changes is still lacking. Such a gap indicates that there is much to learn
about how to manage change more effectively.

At present, Human Resource professionals are not always seen as having the appropriate skills to
lead on change management initiatives, and are therefore not actively included within the change
process. However, many of the issues that are identified concern the 'people aspects' of change.
Human Resources would therefore appear to be ideally placed to ensure such issues are
appropriately and effectively addressed. To achieve this aim Human Resources will need to
ensure it has the skills and credibility within the organization to act as champions of change in
the future.

RESISTANCE TO CHANGE IS A HUMAN TRAIT FOR ATTEMPTING TO

PRESERVE THE EXISTING STATE OF AFFAIRS. TO FIND OUT THE ROLE OF
HUMAN RESOURCE MANAGER IN REDUCING STAFF RESISTANCE TO
CHANGE

Overview
1. Abstract
2. Introduction
3. Forces of change
4. Why organization change is resisted?
5. Barrier to change
6. Role played by HRM in reducing resistance
7. Research gaps
8. Conclusion and recommendations
9. References

According to Mullins (2005) change is a shift of alteration in the present situation. This shift
may be in the way we perceive thins or how items are organized, processed, created or
maintained. There are two main types of change namely, strategic which is concerned with
organizational transformation and operational change. Operational change relates to new
systems, procedures, structures or technology which normally will have an immediate effect
on working arrangements with the organization.

There are times when organizations are likely to change and times during which change is
less likely. In general, change is likely to occur when the people involved believe that the
benefits associated with making a change outweigh the costs involved. The factors
contributing to the benefits of making a change are as follows:
- the amount of dissatisfaction with current conditions
- the availability of a desirable alternative
- The existence of a plan for achieving the alternative.

Theorists have claimed that these three factors combine multiplicatively to determine the
benefits of making a change. Thus, if any one of these factors is zero, the benefits of making a
change and the likelihood of change itself will be zero. People are unlikely to initiate change
if they are not at all dissatisfied or if they do not have any desirable alternative in mind (or
any way of attaining that alternative, if they do have one in mind).Of course, fro change to
occur, the expected benefits must outweigh the likely costs involve, for example disruption,
uncertainties.

FORCES FOR CHANGE

The forces for change can be classifieed conveniently into two groups: external forces and
internal forces. External forces are beyond management’s control. Internal forces operate
inside the firm and are generally within the control of management.
External forces – organizations seldom undertake significant change without a strong shock
from their environment. The external environment includes many economic, technological,
and social/political forces that can trigger the change process. Those who study and practice
organizational change agree that these environmental triggers are necessary but not sufficient
to initiate change. Change also involves manages who are aware of the need for change and
who take action. The HRM has historically been concerned with reacting to economic forces,
technology and social and political change.
Internal forces – Internal forces for change within the organization can usually be traced to
process and behavioral problems. The process problems include breakdowns in decision
making and communications. Decisions aren’t being made, are made too late, or are of poor
quality. Communications are short-circuited, redundant, or simply inadequate.
WHY IS ORGANIZATIONAL CHANGE RESISTED?
Although people may be unhappy with the current state of affairs confronting them in
organization, they may be afraid that any changes will be potentially disruptive and will only
make thing worse. Indeed, fear of new conditions is quite real and it creates unwillingness to
accept change. Organizational scientists have recognized that resistance to change stems from
both individual and organizational variable.

Individual barriers to change

Researchers have noted several key factors that are known to make people resistant to change
in organizations. These are as follows:

Economic insecurity – because any changes on the job have the potential to threaten one’s
livelihood – by either loss of job or reduced pay – some resistance to change is inevitable.
Fear of the unknown – employees derive a sense of security from doing things the same way,
knowing whom their coworkers will be, and whom they are supposed to answer to from day to
day. Disrupting these well-established, comfortable patterns creates unfamiliar conditions, a
state of affairs that is often rejected.

Threats to social relationships: as people continue to work within organizations, they form
strong bonds with their coworkers. Many organizational changes (for example the reassignment
of job responsibilities) threaten the integrity of friendship groups that provide valuable social
rewards.
Habit: jobs that are well learned and become habitual are easy to perfume. The prospect of
changing the way jobs are done challenges people to develop new job skills. Doing this is
clearly more difficult than continuing to perform the job as it was originally learned.
Failure to recognize need for change: unless employees can recognize and fully appreciate
the need for changes in organizations, any vested interest thy may have in keeping things the
same way may overpower their willingness to accept change.

Organizational barriers to change

Resistance to organizational change also stems from conditions associated with organizations
themselves. Several such factors may be identified

Structural inertia. Organizations are designed to promote stability. To the extent that
employees are carefully selected and trained to perfume certain jobs are rewarded for doing
them well, the forces acting on individuals to perfume in certain ways are very powerfully
determined- that s , jobs have structural inertia. Thus, because jobs are designed to have
stability it is often difficult to overcome the resistance created by the forces that create stability.

Work group inertia. Inertia to continue performing jobs in a specified way comes not only
from the jobs themselves but also from the social groups within which people work-work group
inertia. Because of the development of strong social norms within groups (see Chapter 9),
potent pressures exist to perform jobs in certain ways. Introducing change disrupts these
established normative expectations, leading to formidable resistance.
Threats to the existing balance of power. If changes are made with respect to who is in
charge, a shift in the balance of power between individuals and organizational sub-units is
likely to occur. Those units that now control the resources, have the expertise, and wield the
power may fear losing their advantageous positions resulting from any organizational change.

Previously unsuccessful change efforts. Anyone who has lived through a past disaster
understandably may be reluctant t endure another attempt at the same thing. Similarly, groups
or entire organizations that have been unsuccessful in introducing change n the past may be
cautious about accepting further attempts as introducing change into the system.
THE ROLE OF HUMAN RESOURCE MANAGER IN REDUCING STAFF
RESISTANCE STO CHANGE

Since organizational change is inevitable, mangers should be sensitive to the barriers to

change so that resistance can be overcome. This, of course, is easier said than done. However,
several useful approaches have been suggested, and the key ones are summarized here below.

Shape political dynamics – For change to be accepted, it is often useful (if not absolutely
necessary) to win the support of the most powerful and influential individuals in the company.
This builds a critical internal mass of support for change. The HRM should demonstrate
clearly that key organizational leaders endorse the change. This is an effective way to get
others to go along with it – either because they share the leader’s vision or because they fear
the leader’s retaliation. Either way, their support will facilitate acceptance of change.

Educate the workforce – Sometimes people are reluctant to change because they fear what
the future has in store for them. Fears about economic security, for example, may be put to
rest by a few reassuring words from power holders. As part of educating employees about
what organizational changes my mean for them, HRM must show a considerable amount of
emotional sensistivity. Doing so makes it possible for the people affected by change to help
make it work. Some companies have found that simply answering the question ‘what’s in it
for me?’ can help ally a lot of fears.

‘Sell’ the need for change – For organizational change to occur, top management must accept
the idea that change is required. And quite often, it’s lower-level practicing mangers, those
who toil daily in the trenches, who offer the best ideas. For these ideas to be accepted and
Implemented, however, it is necessary for HRM to be convinced that the ideas are
worthwhile.

Involve employees in the change efforts – It is well established that people who participate
in making a decision tend to be more committed to the outcomes of the decision than are
those who are not involved. Accordingly, employees who are involved in responding to
unplanned change, or who are made part of the team charged with planning a needed
organizational change, may be expected to have very little resistance to change.
Organizational changes that are ‘sprung’ on the workforce with little or no warning might be
expected to encounter resistance simply as a knee-jerk reaction until employees have a chance
to assess how the change affects then. In contrast, employees who are involved in the change
process are better able to understand the need for change and are, therefore less likely to resist
it.
When HRM involve employees in change efforts, this means more than simply giving them a
voice in determining the organization’s operations. It also means actively engaging employees
at all levels in the problems the organization faces.

Reward constructive behaviors – one rather obvious and quite successful mechanism for
HRM to facilitate organizational change is rewarding people for behaving in the desired
fashion. Changing organizational operations may necessitate changing the kinds of behaviors
that need to be rewarded by the organization. This is especially critical when an organization
is in the transition period of introducing the change. For example, employees who are
required to learn to use new equipment should be praised for their successful efforts.
Feedback on how well they are doing not only provides a great deal of useful assurance to
uncertain employees but also helps shape the desired behavior.

Lead in a way that stresses the urgency of change – It is not unusual for company officials
to get in a rut, becoming lazy and complacent about the way hey operate, even when it is
necessary to take decisive action. This is almost what happened to Sears a few years ago. The
retailing giant was losing customers rapidly as officers sat by merely lowering sales goals.
That is when Sears’ CEO Arthur Martinez lit a fire under everyone by stressing the
importance of turning things around – or else! He generated a sense of urgency by setting
very challenging goals (e.g., quadrupling market share, and increasing customer satisfaction
by 15 percent). Although the CEO did not have all the answers to Sears’ problems, he
provided something even more important – straightforward, honest talk about the company’s
problems, creating a sense of urgency that got everyone moving in the right direction.

Pay careful attention to job design – the HRM should pay careful attention to job design
and develop cohesive groups. HRM should give attention to the wider organizational context
including the design of technology itself when new technology is to be introduced. This action
would improve job design, employee involvement and empowerment, the development of
skills and problem-solving capacity, and the effective management of change.

Acknowledge resistance –acknowledging resistance consists of two activities: listening and

sharing. First, HRM should listen carefully to clients’ messages to determine their meaning. In
fact, the very process of listening helps convert tension into words that serve to reduce
anxiety, even if the words themselves do not actually reveal the nature of the tension or the
reason for it.
The second activity involves sharing of feelings with clients. Sharing is a form of support.
When HRM demonstrate their understanding of clients’ feelings and are not surprised or upset
by negative statement, it illustrates their support, which helps reduce tension. To be
successful in this stage HRM should remain calm and neutral, saying and doing nothing that
will increase clients’ tensions or fears.

Create a ‘learning organization – Although all organizations change, whether they want to
or not, some do so more effectively than others. Those organizations that have developed the
capacity to adapt and change continuously are know as learning organization. In learning
organizations, people set aside old ways of thinking, freely share ideas with others, form a
vision of the origination, and work together on a plan for achieving that vision.

Research gaps
Porras and Robertson (1992) that the necessary information to guide change is only partially
available and that a good deal of more research and thinking are needed to fill the gaps.
Change activities can vary depending on such factors as the magnitude of change.
Considerably more effort needs to be expected in a domestic or an international setting. As
change unfolds, new stakeholders may emerge and demand reflections to reflect previously
unknown or unvoiced needs. Further research could be carried out in these areas.

Conclusion
In this era of global competition, technological innovation, turbulence, discontinuity, even
chaos, change is inevitable and necessary. The organization must do all it can to explain why
change is essential and how it will affect the stakeholders. Moreover, every effort must be
made to protect the interests of those affected by change. Hence, Drucker came to the
conclusion that “one cannot manage change. One can only be ahead of it. We do not hear
much anymore about ‘overcoming resistance to change’. Everyone now accepts that change is
inevitable. In a period of upheavals, such as the one we are living in, change is the norm. It is
painful and risky, and above all, it requires a great deal of very hard work. But unless it is
seen as the task of the organization to lead change, the organization – whether business, a
learning institution, may not survive.

Many organizations, the need for change goes unrecognized until some major catastrophe
occurs. The employees strike or seek the recognition of a union before management finally
recognized the need for action. Whether it takes a whisper or a shout, the need for change
must be recognized by some means; and once that need has been recognized, the exact nature
of the problem must be diagnosed. If the problem is not properly understood, the impact of
change on people can be extremely negative.
 To overcome resistance to change, it helps to discover the individual variables (e.g.,
personality) and aspects of the work setting to which such resistance is most closely linked.
Doing this makes it possible to identify specific ways of changing people and/or changing
situations so as to make them more accepting of organizational changes.

Recommendations
Management should facilitate and support the change process by providing the necessary
resources that employees need. This will enable them to carry out the changes and be able to
perform their jobs. This may call for decentralization of authority. The management should
constantly monitor the change process so that correct action is taken in good time. Employee’s
views should be incorporated when effecting change and change should be introduced
gradually.

CHANGE MANAGEMENT
BY: DOUGLAS OGOLLA PH.D CLASS KEMU

OVERVIEW
i. Abstract
ii. Introduction
iii. Theoretical framework
iv. Conceptual framework
v. Review of literature
- Forces for change
- Overcoming resistance to change
VI Research gaps
Vii Conclusion and Recommendations
viii. References

ABSTRACT
The paper gives explanations of the nature of planed change using change models.Forces
influencing change are identified and reasons for resistance given. Research gaps in change
management are identified.

INTRODUCTION
The world is dynamic experiencing changes on a daily basis, and any organization that has
resisted change has faced extinction. In order to survive therefore organizations must embrace
change that is for the better. Change is an inescapable part of both social and organization life.
Change can affect all aspects of the operation and function of the organization. Armstrong
(2005).
NATURE OF CHANGE
Definitions
Change is a shift or alteration in the present situation. The shift may be in the way we perceive
things or how items are organized, processed, created or maintained. Organizational change is a
process in which an organization takes new ideas or ways in a bid to become different.
Organizational-wide change may be experienced when there is a shift or alteration in various
areas which may include change in the organization’s mission, restructuring operations ( for
example, restructuring to self-managed teams, layoffs, etc), new technologies, start up of new
divisions, changes in work ethics (for example new policies, values and expectations etc),
introduction of new product line or production lines, re-engineering, top management changes,
tighter production schedules and divestitures. Mullins (2005)

Change management on the other hand is systematic approach to dealing with change, both
from an individual or organizational perspective level.

Types of change
There are two main types of change namely, Strategic and operational change. Strategic
change is concerned with organizational transformation. Strategic change therefore deal with
board, long term and organization- wide issues. It is about moving to a future state, which has
been defined generally in terms of strategic vision and scope. It covers the purpose and mission
of the organization, its corporate philosophy on such matters as growth, quality, and innovation
and values concerning people, the customer needs served and the technologies employed. It
takes place within the context of the external competitive, economic and social environment and
the organization’s internal resources, capabilities, culture, structure and systems.

Operational change
Relates to new systems, procedures, structures or technology which normally will have an
immediate effect on working arrangements within the organization.

THEORETICAL FRAMEWORK
Theories of planned change
Conceptions of planned change have tended to focus on how change can be implemented in
organizations. Called “theories of changing”, these frameworks describe the activities that must
take place to initiate and carry out successful organizational change.
Comparison of planned change models
Lewin’s change model Action research model The
positive model

Unfreezing Problem Initiate the inquiry

Identification

Consultation with
Behavioral science expert
Movement
Consultation with
Behavioral science Inquire into best
Expert practices

Data gathering and

preliminary Diagnosis
Discover themes

Feedback to key client

or group
Refreezing Joint Diagnosis of
problem Envision a preferred
future

Joint Action
planning
Design and deliver
Action ways to create the
future
Data gathering after
action

Lewin’s Change Model

One of the early fundamental models of planned change was provided by Kurt Lewin. He
conceived of change as modification of those forces keeping system’s behaviour stable.
Spefically according to Kurt Lewin(1951) a particular set of behaviours at any moment in time is
the result of two groups of force: those striving to maintain the status quo and those pushing
for change. When both sets of forces are about equal, current behaviours are maintained in what
Lewin termed a state of “quasi-stationary equilibrium”. To change that state, , one can
increase those forces pushing for change and decrease those forces maintaining the current
state, or apply some combination of both. For example, the level of performance of a work
group might be stable because group norms maintaining that level are equivalent to the
supervisor’s pressure for change to higher levels.This level can be increased either by changing
the group norms to support higher levels of performance or by increasing supervisor pressure to
produce at higher levels. Lewin suggested that modifying those forces maintaining the status
quo produces less tension and resistance than increasing forces for change and consequently is a
more effective change strategy.
Lewin viewed this change process as consisting of the following three steps:

Unfreezing: This step usually involves reducing those forces maintaining the organization’s
behaviour at its present level. Unfreezing is sometimes accomplished through a process of
“psychological disconfirmation”. By introducing information that shows discrepancies between
behaviours desired by organization members and those behaviors currently exhibited, members
can be motivated to engage in change activities.

Moving: This step shifts the behaviour of the organization, department, or individual to a
new level. It involves intervening in the system to develop new behaviours, values, and attitudes
through changes in organizational structure and processes.
Refreezing: This step stabilizes the organization at a new state of equilibrium. It is frequently
accomplished through the use of supporting mechanisms that reinforce the new organizational
state, such as organizational culture, norms, policies and structures.
Action Research Model
The action research model focuses on planned change as cyclical process in which initial
research about the organization provides information to guide subsequent action. Then the
results of the action are assessed to provide further information to guide further action, and so on.
It places heavy emphasis on data gathering and diagnosis prior to action planning and
implementation, as well as careful evaluation of results after action is taken. Cyclical phases of
planned change as defined by the original action research model there are eight steps:-
1. Problem identification. This stage usually begins when a key executive in the
organization or someone with power and influence senses that the organization has one or
more problems that might be solved with the help of an OD practitioner.
2. Consultation with a behavioral science expert. During the initial contact, the OD
practitioner and the client usually assess each other. The practitioner has his or her own
normative, developmental theory or frame of reference and must be conscious of those
assumptions and values. Sharing them with the client from the beginning establishes an
open and collaborative atmosphere.
3. Data gathering and preliminary diagnosis. This step is usually completed by the OD
practitioner, often in conjunction with organization members. It involves gathering
appropriate information and analyzing it to determine the underlying causes of
organizational problems. The four basic methods of gathering data are interviews,
 process observation, questionnaires, and organizational performance data (unfortunately,
often overlooked).
4. Feedback to a key client or group. Because action research is a collaborative activity,
the diagnostic data are fed back to the client, usually in a group or work-team meeting.
The feedback step, in which members are given the information gathered by the OP
practitioner, helps them determine the strengths and weakness of the organization or unit
under study.
5. Joint diagnosis of the problem. At this point, members discuss the feedback and
explore with the OD practitioner whether they want to work on identified problems. A
close interrelationship exists among data gathering, feedback, and diagnosis because the
consultant summarizes the basic data from the client members and presents the data to
them for validation and further diagnosis
6. Joint action planning. Next, the OD practitioner and the client members jointly agree
on further actions to be taken. This is the beginning of the moving process (described in
Lewin’s change model), as the organization decides how best to reach a different quasi-
stationary equilibrium. At this stage, the specific action to be taken depends on the
culture, technology, and environment of the organization.
7. Action. This stage involves the actual change from one organizational state to another. It
may include installing new methods and procedures, reorganizing structures and work
designs, and reinforcing new behaviors. Such actions typically cannot be implemented
immediately but require a transition period as the organization moves from the present to
a desired future state.
8. Data gathering after action. Because action research is a cyclical process, data must
also be gathered after the action has been taken to measure and determined the effects of
the action and to feel the results back to the organization. This, in turn, may lead to re-
diagnosis and new action.

The positive model. The positive model focus on what the organization is doing right. It
helps members understand their organization when it is working at its best and builds off of
those capabilities to achieve even better results. Focuses on positive dynamics in
organizations that give rise to extraordinary outcomes. It shows that people tend to act in
ways that make their expectations occur. Thus positive expectations about the organization
can crate an anticipation that energizes and directs behavior toward making those beliefs
happen. The positive model of planned change involves five phases:-
i) Initiate the inquiry. This first phase determined the subject of change. It
emphasizes member involvement to identify the organizational issue they
have the most energy to address. For example, members can choose to look
for successful male-female collaboration (as opposed to sexual
discrimination), instances of customer satisfaction (as opposed to customer
dissatisfaction), particularly effective work teams, or product development
 processes that brought new ideas to market especially fast. If the focus of
inquiry is real and vital to organization members, the change process itself
will take on these positive attributes.
ii) Inquire into Best practices. This phase involves gathering information about
the “best of what is” in the organization. F the topic is organizational
innovation, and then members help to develop an interview protocol that
collects stories of new ideas t hat were developed and implemented in the
organization. The interviews are conducted by organization members; they
interview each other and tell stories of innovation in which they have
personally been involved. These stories are pulled together to create a pool of
information describing the organization as an innovative system.
iii) Discover the Themes. Members examine the stories, both large and small, to
identify a set of themes representing the common dimensions of people’s
experiences. For example, the stories of innovation may contain themes about
how managers gave people the freedom to explore a new idea, the support
organization members received from their co-workers, or how the exposure to
customers sparked creative thinking.
iv) Envision a preferred future. Members then examine the identified themes,
challenge the status quo, and describe a compelling future. Based on the
organization’s successful past, members collectively visualize the
organization’s future and develop “possibility propositions”- statements that
bridge the organization’s current best practices with ideal possibilities for
future organizing”.
v) Design and Delivery Involves the design and delivery of ways to create the
future. It describes the activities and creates the plans necessary to bring
about the vision. It proceeds to action and assessment phases similar to those
of action research. Members make changes, assess the results, make
necessary adjustments, and so on as they move the organization toward the
vision and sustain” what will be.
 General model of planned change

Planning and Evaluating

Entering and Diagnosing implement and
contracting change institutionali
zing change

CONCEPTUAL FRAMEWORK
The figure below shows conceptualization of organizational change
Technology

Culture

Organizational Planned Strategies

performance change
/outcome
Leadership

Globalization

Competition

Economic environment

Legal environment

Organization performance is influenced by planned change strategies

Change in organizational may be as result of change technology, culture, strategies, leadership
etc
REVIEW OF LITERATURE
Forces for organizational change
Change may originate from outside or inside the organization due to various factors which are
either external forces of change or Internal forces of change.
External forces or triggers of change
1. Market Forces
These include activities and innovations of competitors and include the need to develop
new/improved products, continually develop competitive pricing policies and provided
new improved services and quality of services.
2. Legislation and government policies. This includes environmental and employment
legislation like quota controls, Equal opportunities and discrimination.
3. New Technologies – these may include new process equipment, new computer
technology or new information/data processing system.

Internal forces or triggers or organizational change can include:-

1. Profitability is a major thrust for change- these are changes which occur with the aim
of improving the organizations profitability, and include attitudes and skill of senior
management; products or research; improved production facilities and Reduction in staff.
2. Take over/mergers. This source of change seeks to improve efficiency in the use of
assets and increases profitability. These measures include economies of scale; reduced
duplication; increased market pull; more dynamic pull and dynamic management.
3. Low performance and morale, high stress and staff turnover
4. Appointment of new senior manager’s or top management team
5. Rapid technological advancement within the organization
6. Aging of materials and human resources
7. change in managerial polices and styles
Resistance to change
Despite the potential positive outcomes or attributes, change is often resisted at both the
individual and the organizational level as it involves confrontation with the unknown and loss
with the familiar. Resistance to change can take many forms and it often difficult to pinpoint the
exact reasons for the resistance. Fears may be expressed over such mattes as, Employment
levels and job security; Loss of satisfaction; Wage rate differentials; Changes to social structures
and working conditions; Loss of individual control over work, and Greater management control.
Many people find change, or the thought of change, gainful and frustrating. Hence, people resist
change because it is seen as a threat to familiar patterns of behaviour as well as to status and
financial rewards. Organizations run into some form of employee resistance when introducing
any change. Change may trigger emotional reactions because of the uncertainty involved in
change. In planning for change therefore it is important that management must always take
resistance to change into account. This can be done by understanding why people and
organizations as well resist change.
Individuals resist change for various reasons and include the shock of the new. People are
suspicious of anything which they perceive will upset their established routines, methods of
working or conditions of employment. They do not want to lose the security of what is familiar
to them. They may not believe statements by management that the change is for their benefit as
well as that of the organization; sometimes with good reason. They may feel that management
has ulterior motives and sometimes the louder the protestations of management; the less they will
be believed.

Threatened self interests.

 Economic implication fears. People are likely to resist change which is perceived as
reducing either directly or indirectly their pay or other rewards, requiring an increase
in work for the same level of pay or acting as a threat to their job security. People
tend to have established patterns of working and a vested interest in maintaining the
status quo.
 Inconvenience or loss of freedom. If the change is seen as likely to, prove
inconvenient; make life more difficult; reduce freedom of action or results in
increased control then there will be resistance.
 Fear of the unknown or Uncertainty. Change can be worrying because of
uncertainty about its likely impact. Change which confronts people with the unknown
tends to cause anxiety or fear. Many major changes in a work organization present a
degree of uncertainty; for example, the introduction of new technology or methods of
working. A person may resist promotion because of uncertainty over changes in
responsibilities or the increased social demands of the higher position.
 Symbolic fears - a small change that may affect some threatened symbol, such as a
separate office or a reserved parking space, may symbolize big ones, especially when
employees are uncertain about how extensive the program of change will be.
 Competence fears — lays emphasis on the ability to cope with new demands or to
acquire new skills.
 Habit. People tend to respond to situations in an established and accustomed manner.
Habits may serve as a means of comfort and security, and as a guide for easy
decision-making. Proposed changes to habits, especially if the habits are well
established and require little effort, may well be resisted. However, if there is a
clearly perceived advantage, for example a reduction in working hours without loss of
pay, there is likely to be less, if any, resistance to the change, although some people
may, because of habit, still find it difficult to adjust to the new times.
 Selective perception. People's own interpretation of stimuli presents a unique picture
or image of the "real" world and can result in selective perception. This can lead to a
biased view of a particular situation, which fits most comfortably into a person's own
perception of reality, and can cause resistance to change. For example trade unionists
may have a stereotyped view of management as untrustworthy and therefore oppose
 any management change; however well founded might have been the intention.
Managers exposed to different theories or ideas may tend to categorize these as either:
those they already practice and have no need to worry about or those that are of no
practical value and which can be discarded as of no concern to them.
 Security in the past. There is a tendency for some people to find a sense of security
in the past. In times of frustration or difficulty, or when faced with new or unfamiliar
ideas or methods, people may reflect on the past. There is a wish to retain old and
comfortable ways. For example, in bureaucratic organizations, officials often tend to
place faith in well-established ('tried and trusted') procedures and cling to these as
giving a feeling of security.
Arthur Bedeian (1980) cites the following four as the main cause of I
individual resistance to change.
 Parochial self-interest. We understandably seek to protect a status quo with which
we are content and which we regard as advantageous to us in some way. Change may
threaten to move us out of our "comfort zone", away from those things which we
prefer and enjoy. We develop vested interests in the perpetuation of organization
structures and accompanying technologies. Change can mean loss of power, prestige,
respect, approval, status and security.

Misunderstanding and lack of trust. We are more likely to resist change when we do not
understand the reasoning behind it, or its nature and possible consequences. If managers have
little trust in their employees, information about change may be withheld or distorted. If
employees distrust managers on the other hand then information about changes proposed by
management may not be believed. Incomplete and incorrect information creates uncertainty and
rumour. This has the unfortunate result of increasing perceptions of threat, increasing
defensiveness, and reducing further effective communication about the change.

Contradictory assessment. We differ in the ways in which we perceive and evaluate the costs
and benefits of change; our personal values ultimately determine which changes are welcomed,
promoted and succeed, and which ones fail. Our contradictory assessments are more likely to
arise when communication is inadequate, and where those concerned lack the relevant
information.

Low tolerance for change. We differ in our abilities to cope with change, to face the unknown
and to deal with uncertainty. Change that requires people to think and behave in different way
scan challenge the individual's self concept. We each have ideas about our abilities and our
strengths. The anxiety and apprehension that they suffer may lead them to oppose even,
potentially beneficial changes. It is important to note that there are potentially as many different ;
reasons for resisting change as there are individuals affected.
RESEARCH GAPS
Porras and Robertson (1992) concluded that the necessary information to guide change as only
partially available and that a good deal more research and thinking are needed to fill the gaps. A
related are where current thinking about planned change is defiant is knowledge bout how the
stages of planned change differ across situations. Most models specify a general set of steps that
intended to be applicable to most change efforts. Change activities can vary depending on such
factors as the magnitude of change. Considerably more effort needs to be expected in a domestic
or an international setting. Considerably more efforts needs to be expended identifying
situational factors that may require modifying the general stages of planned change. That would
likely lead to a rich array of planned change thinking is greatly needed in planned change. As
change unfolds, new stakeholders may emerge and demand reflections reflecting previously
unknown or unvoiced needs. Those emergent conditions make planned change a far more
disorderly and dynamic process than is customarily portrayed, and conceptions need to capture
that reality. Further research could be carried out in these areas.

CONCLUSION
In an age of global competition, technological innovation, turbulence, discontinuity, even chaos,
change is inevitable and necessary. The organization must do all it can to explain why change is
essential and how it will affect everyone. Moreover, every effort must be made to protect the
interests of those affected by change. Hence, Drucker came to the conclusion that "one cannot
manage change. One can only be ahead of it. We do not hear much anymore about "overcoming
resistance to change". Everyone now accepts that change is unavoidable. In a period of
upheavals, such as the one we are living in, change is the norm. It is painful and risky, and above
all it requires a great deal of very hard work. But unless it is seen as the task of the organization
to lead change, the organization - whether business, university, hospital and so on - will not
survive.

RECOMMENDATIONS
Management in organizations should do the following in a bid to reduce change resistance.
Sensitize employees through workshops, meetings etc to explain the effects of change and how it
will benefit them so that they are not afraid of the unknown. Management should also involve
employees in the change process implementation by making them change leaders and part of the
change committee's. Management should facilitate and support the change process by providing
the necessary resources that employees need to carry out the changes and be able to perform their
jobs. This may call for decentralization of authority. They should support the employees by
listening to their problems, being understanding and being their physically and emotionally when
needed. Management could also negotiate a proposed change with the parties involved.
Incentives should be given to employees who embrace change - this could be in form of
allowances and promotion. They should constantly monitor the change process so that corrective
action is taken in good time. Employee's views should be incorporated when effecting change
and change should be introduced gradually.