PRINCIPLES OF MANAGEMENT

MANAGEMENT
Management is the process of planning and organising the resources, operations and
workflow of a business to achieve specific goals in the most effective and efficient manner
possible.
Henri Fayol explains management as a process of forecast followed by planning,
organization, command, coordination and control of activities of others. In simpler
terms, management refers to proper organization and delegation of work along with
ensuring its completion.
PRINCIPLES OF MANAGEMENT
Principles of management are basic activities that can help you plan, organize and control
operations related to material, people, machines, methods, money and markets. They
provide leadership to human efforts so that they achieve set objectives efficiently.

CHARACTERISTICS OF MANAGEMENT

Some of the fundamental characteristics of management are :

Multi-dimensional

Most management oversees and supervises a company or organisation's service or production

cycle. Managers provide guidance and work closely with the members of their team. A
manager considers a staff member both as an individual with diverse needs and as a
component of the larger group. To be effective, managers influence their team members to
apply their unique strengths toward achieving the organisation's goals.

Dynamic

Management is a dynamic function and evolves and adapts to changes in its environment,
whether they are economic, socio-political or technological. For instance, a paper company
could see a decline in sales because of the rapid adoption of screens and digital devices.
Whether the company can still survive depends on how effectively its management can adapt
to new market requirements.
Intangible

Management is not a tangible product, but its presence can change the way an organisation
functions. Management consists of ideologies, policies and human interaction. Good
management helps improve a company's target achievement ratios, employee gratification
levels and overall ease in the company's operation.

OBJECTIVES OF MANAGEMENT

Management can have mainly three types of objectives:

Organisational objectives

Management should consider the interests of all company stakeholders, including employees,
customers and the government. Managers are responsible for setting and achieving goals for
the organisation. Typically, the primary aim of an organisation is to achieve growth by
utilising its human, material and financial resources. There are three general organisational
objectives for any company:

 Survival: An organisation needs to generate enough revenues to cover its operational

costs.
 Profit: Profit provides incentive and is essential for covering unprecedented costs and
risks associated with running a business.
 Growth: You can measure the growth of a business in terms of increases in sales
volume, workforce and capital investment.

Social objectives

To an extent, the management is also responsible for creating benefits for the society through
their work. Companies choose to do this in different ways. Some may incorporate
environment-friendly methods of production, while others implement fair wages and
opportunities. Larger companies often maintain or fund initiatives that provide basic
amenities like healthcare and education. Based on the scale of their operations, companies
often initiate CSR (Corporate Social Responsibility) campaigns that benefit society in
different ways.
Personnel objectives

The management typically decides the financial incentives, salaries, perks and social
initiatives for their employees. Activities that improve peer recognition and interaction like
corporate outings and holiday bonuses cater to the personnel's social growth and
development.

IMPORTANCE OF MANAGEMENT

Here are some reasons why management is important:

 Helps in achieving group goals: Effective management gives a common direction to

individual efforts and guides them towards achieving the overall goals of an
organisation.
 Increases efficiency: Efficiency reduces costs and increases productivity in all
spheres of an organisation's work.
 Creates a dynamic organisation: Management helps its personnel in adapting to
change so that the organisation continues to maintain its competitive edge. How well
an organisation can respond and adapt to change can mean the difference between its
success and failure.
 Helps in achieving personal objectives: Effective management fosters team spirit,
cooperation and commitment to achieve the organisational goals as a group, which
helps each term member achieve their personal objectives.
LEVELS OF MANAGEMENT

1. Top-Level Management: This is the highest level in the organizational hierarchy,

which includes Board of Directors and Chief Executives. They are responsible for
defining the objectives, formulating plans, strategies and policies.
2. Middle-Level Management: It is the second and most important level in the
corporate ladder, as it creates a link between the top and lower-level management. It
includes departmental and division heads and managers who are responsible for
implementing and controlling plans and strategies which are formulated by the top
executives.
3. Lower Level Management: Otherwise called as functional or operational level
management. It includes first-line managers, foreman, supervisors. As lower-level
management directly interacts with the workers, it plays a crucial role in the
organization because it helps in reducing wastage and idle time of the workers,
improving the quality and quantity of output.

The three management levels form the management hierarchy, that represents the position
and rank of executives and managers in the chart.
FUNCTIONS OF MANAGEMENT

The purpose of management is to unify the efforts of different individuals in an organisation

towards achieving a common goal. These are some functions of management:

Planning

Planning involves creating a timeline of tasks that need to be completed to achieve a specific
goal. Planning should be carried out in a systematic fashion to avoid wastage of resources and
time. A detailed plan of action minimises confusion, risk, wastage and uncertainty.

Organizing

The objective of organising is to nurture a symbiotic relationship between the personnel,

financial and physical resources of the company. Proper organising provides the course of
action that meets all parameters for success. Organising involves the identification and
classification of business activities, delegation and coordination. For instance, the top
managers may allocate funds or resources to different branches. The branch managers must
then allocate funds to departments within the branch, depending on their operational
requirements. The department heads then track the day-to-day expenditure of the funds.

Staffing

Staffing involves recruiting and building a team for the organisation. The staffing process of
companies is often lengthy and in-depth. Management identifies professional roles in the
company and the skills/qualities required to perform well in these roles.

Provide direction

Supervising, motivating and guiding the staff members is central to the functions of a
manager. Directing involves taking the steps to put the work in motion and maintain
productivity to achieve company goals. This requires excellent leadership, communication
and interpersonal skills to drive the team towards completing organisational objectives. For
example, the middle management often makes policies based on directions they receive from
the top management. Operational managers focus more on managing the day-to-day
functioning of the company.
Monitor quality

Businesses function on some established standards of performance. A manager ensures that

the staff's collective output meets quantity and quality benchmarks set by the company.
Control at each level prevents overall deviation from prescribed quality specifications.

Henri Fayol's PRINCIPLES OF MANAGEMENT

Henry Fayol, also known as the Father of Modern Management Theory, gave a new
perception on the concept of management. He introduced a general theory that can be applied
to all levels of management and every department. He envisioned maximising managerial
efficiency. Today, Fayol’s theory is practised by the management to organise and regulate the
internal activities of an organisation.

1. Division of Work

Henri believed that segregating work in the workforce amongst the workers will enhance the
quality of the product. Similarly, he also concluded that the division of work improves the
productivity, efficiency, accuracy and speed of the workers. This principle is appropriate for
both the managerial as well as a technical work level.

2. Authority and Responsibility

These are the two key aspects of management. Authority facilitates the management to work
efficiently, and responsibility makes them responsible for the work done under their guidance
or leadership.

3. Discipline

Without discipline, nothing can be accomplished. It is the core value for any project or any
management. Good performance and sensible interrelation make the management job easy
and comprehensive. Employees’ good behaviour also helps them smoothly build and progress
in their professional careers.
4. Unity of Command

This means an employee should have only one boss and follow his command. If an employee
has to follow more than one boss, there begins a conflict of interest and can create confusion.

5. Unity of Direction

Whoever is engaged in the same activity should have a unified goal. This means all the
people working in a company should have one goal and motive which will make the work
easier and achieve the set goal easily.

6. Subordination of Individual Interest

This indicates a company should work unitedly towards the interest of a company rather than
personal interest. Be subordinate to the purposes of an organisation. This refers to the whole
chain of command in a company.

7. Remuneration

This plays an important role in motivating the workers of a company. Remuneration can be
monetary or non-monetary. Ideally, it should be according to an individual’s efforts they have
put forth.

8. Centralization

In any company, the management or any authority responsible for the decision-making
process should be neutral. However, this depends on the size of an organisation. Henri Fayol
stressed on the point that there should be a balance between the hierarchy and division of
power.

9. Scalar Chain

Fayol, on this principle, highlights that the hierarchy steps should be from the top to the
lowest. This is necessary so that every employee knows their immediate senior also they
should be able to contact any, if needed.
10. Order

A company should maintain a well-defined work order to have a favourable work culture.
The positive atmosphere in the workplace will boost more positive productivity.

11. Equity

All employees should be treated equally and respectfully. It’s the responsibility of a manager
that no employees face discrimination.

12. Stability

An employee delivers the best if they feel secure in their job. It is the duty of the management
to offer job security to their employees.

13. Initiative

The management should support and encourage the employees to take initiatives in an
organisation. It will help them to increase their motivation and morale.

14. Esprit de Corps

It is the responsibility of the management to motivate their employees and be supportive of

each other regularly. Developing trust and mutual understanding will lead to a positive
outcome and work environment.

IMPORTANCE OF MANAGEMENT PRINCIPLES

Following are the main importance of the Principles of Management.

 Improves Understanding.
 Direction for Training of Managers.
 Role of Management.
 Guide to Research in Management.
1. Improves Understanding - From the knowledge of principles managers get
indication on how to manage an organization. The principles enable managers to
decide what should be done to accomplish given tasks and to handle situations which
may arise in management. These principles make managers more efficient.
2. Direction for Training of Managers - Principles of management provide
understanding of management process what managers would do to accomplish what.
Thus, these are helpful in identifying the areas of management in which existing &
future managers should be trained.
3. Role of Management - Management principles makes the role of managers concrete.
Therefore, these principles act as ready reference to the managers to check whether
their decisions are appropriate. Besides these principles define managerial activities in
practical terms. They tell what a manager is expected to do in specific situation.
4. Guide to Research in Management - The body of management principles indicate
lines along which research should be undertaken to make management practical and
more effective.

The principles guide managers in decision making and action. The researchers can
examine whether the guidelines are useful or not. Anything which makes management
research more exact & pointed will help improve management practice.
 THEORETICAL FOUNDATIONS OF MANAGEMENT

 Definition of a Theory
 Objectives of a theory
 Characteristics of a theory

DEFINITION OF A THEORY

 A supposition or a system of ideas intended to explain something

 Ttheory is a well-substantiated explanation of an aspect of the natural world that can
incorporate laws, hypotheses and facts
 A set of ideas that is intended to explain facts or events

OBJECTIVES OF ATHEORY

The primary objectives of a theory are to

 explain observed phenomena,
 identify patterns and relationships within a subject area,
 make predictions about future occurrences, and
 provide a framework for further research and understanding; essentially
CHARACTERISTICS OF A THEORY

Testability:
The theory should be able to be tested through empirical research and generate falsifiable
hypotheses.
Explanatory Power:
It should effectively explain the phenomenon it is designed to address, providing a clear
understanding of the relationships between variables.
Coherence:
Concepts within the theory should be logically connected and consistent with each other,
avoiding contradictions
Parsimony (economy):
A good theory should be as simple as possible while still adequately explaining the
phenomenon, avoiding unnecessary complexity
Generalizability:
The theory should be applicable to a broad range of situations and contexts, not just a specific
case
Empirical Validity:
The theory should be supported by evidence gathered through observation and
experimentation
Predictive Power:
It should be able to generate predictions about future occurrences based on the established
relationships
Clarity of Concepts:
Terms and variables within the theory should be clearly defined and operationalized
Falsifiable:
The theory should be able to be disproven if contradictory evidence is found
Relevance:
The theory should address a significant question or problem within the field of study

MANAGEMENT THEORIES

 Scientific Management Theory

 Scientific management theory Goals
 Principles of scientific theory
 Contributions of Scientific Management Theory
 Principles of Scientific theory
 Applications/Limitations of Scientific theory
 Systems Management Theory
 Application of System Management
 Contingency Management Theory
 features of the contingency theory
 Theory X and Theory Y
 Assumptions of the Theory X &Y
 Application of Theory X&Y

INTRODUCTION ON MANAGEMENT THEORIES

Management theories are concepts surrounding recommended management strategies, which

may include tools such as frameworks and guidelines that can be implemented in modern
organizations. Management theories are a collection of ideas that recommend general rules
for how to manage an organization or business. Generally, professionals will not rely solely
on one management theory alone, but instead, introduce several concepts from different
management theories that best suit their workforce and company culture.

POPULAR MANAGEMENT THEORIES

SCIENTIFIC MANAGEMENT THEORY( by Frederick Winslow Taylor)

Scientific management is a management theory that analyzes work flows to improve

economic efficiency, especially labor productivity. This management theory was developed
by Frederick Winslow Taylor, was popular in the 1880s and 1890s in U.S. manufacturing
industries. He and his associates were among the first individuals to study work performance
scientifically. Taylor’s philosophy emphasized the fact that forcing people to work hard
wasn’t the best way to optimize results. Instead, Taylor recommended simplifying tasks so as
to increase productivity.

GOALS OF SCIENTIFIC MANAGEMENT THEORY

 Improving productivity by standardizing tools to achieve a high production rate.
 Ensuring quality is consistent in products through research and quality control.
 Introducing cost control techniques to minimize the cost of production.
 Making sure consumers find a regular supply of goods.
PRINCIPLES OF SCIENTIFIC THEORY

Replace the “rule of thumb” with science and standardization

There should only be one method of working. It must be defined scientifically. According to
Taylor, the best way to do a job must be determined beforehand in a scientific fashion. If
workers have devised their own ways of working, it will not lead to productivity.
The ‘ways of working’ here refer to the tools used. These tools must be standardized and that
will remove the factor of bad working conditions. There should be no rule of thumb, nor any
trial and error for any job. That way, the worker’s performance will increase.
The Right Person for the Job
For any job, the management should hire the right person for the right job. That worker
should have the necessary skills to perform the tasks to fruition. The management should also
hire a worker knowing they will have challenges too. For that, training workers would be
required once they are selected. Then the worker should be introduced to standardized tools
for their work process.
Proper Division of Work Between Workers and Managers
The core functions of management, planning, organising, controlling, and directing, must be
adopted by the organization. The worker who is assumed to be able to work should not be
assumed to know and apply these facets of management. By assigning the worker with the
correct workload, there can be a better mutual understanding between two parties, and will
further eliminate uncertainties in the future.
Collaboration Between Workers and Managers
Workers and managers should work in harmony, according to this principle. It is the
responsibility of the management to create a healthy environment for the workers by
eliminating distrust. For that, there should be clear communication and development of team
spirit.
APPLICATIONS OF SCIENTIFIC MANAGEMENT THEORY of Frederick Winslow
Taylor
Scientific management theory is applicable in a variety of modern-day business contexts.
For Ensuring Quality
For the function of management to help plan documents that meet standards is equivalent to
the documentation used today in quality management best practices, such as ISO 9000.
For Eliminating Repetitive Tasks
Another application of scientific management in practice is using tools that eliminate
mundane tasks. One example can be marketing automation which can be used for email
delivery to the right consumers at different stages of the marketing funnel. This way, the
marketing department can work on more creative tasks and improve efficiency there.
 Pioneering the use of time studies,
 Division of labor based on function, cost-control systems, written instruction for
workers, planning, and standardized equipment.
LIMITATIONS OF SCIENTIFIC MANAGEMENT THEORY
There are a few criticisms of this scientific theory of management.
 The basic limitation is that workers are not treated humanely, as the focus is only on
productivity and efficiency.
 There is no concern for the emotional or psychological well-being of the employees.
 Focusing on one type of skill, the other skills the worker may have are not considered
in this theory. So, any initiative a worker may have is not considered by the
management.
 Doing the same kind of work can lead to monotony in the future.
 Too much focus on performance based on time can demotivate employees. This can
lead to absenteeism. It can also adversely affect their mental states, of which the
theory is unconcerned with

SYSTEMS MANAGEMENT THEORY- By Ludwig von Bertalanffy

The systems management theory asserts that for a large organizational system to function
at an optimal level, its multiple components must all work together in harmony. That
means the employees, departments, work groups and business units all play a crucial role in
the system's success. The System Theory of Management views organizations as complex
systems comprising interconnected subsystems that work together towards a common goal.
Ludwig von Bertalanffy formalized this theory in the 1950s, moving away from the classical
management view of organizations as machines and embracing a holistic perspective.

Systems management offers an alternative approach to the planning and management of

organizations. The systems management theory proposes that businesses, like the human
body, consists of multiple components that work harmoniously so that the larger system can
function optimally. According to the theory, the success of an organization depends on
several key elements: synergy, interdependence, and interrelations between various
subsystems.

Employees are one of the most important components of a company. Other elements crucial
to the success of a business are departments, workgroups, and business units. In practice,
managers are required to evaluate patterns and events in their companies so as to determine
the best management approach. This way, they are able to collaborate on different programs
so that they can work as a collective whole rather than as isolated units.

APPLICATION OF SYSTEM MANAGEMENT

Systems theory is a holistic approach that focuses on the interrelationships and

interdependencies among different components of a system. In the context of resource
management, it helps in understanding the complex interactions within and between natural
and human systems.

CONTINGENCY MANAGEMENT THEORY-by Fred Edward Fiedler

The contingency theory of leadership was proposed by the Austrian psychologist Fred
Edward Fiedler in his landmark 1964 article, "A Contingency Model of Leadership
Effectiveness.".

The main concept behind the contingency management theory is that no one management
approach suits every organization. There are several external and internal factors that will
ultimately affect the chosen management approach. The contingency theory identifies three
variables that are likely to influence an organization’s structure: the size of an organization,
technology being employed, and style of leadership.

The Contingency Theory of Leadership emerged as a game-changer in the 1960s, shaking up

the field of leadership studies. This theory was a direct response to the limitations of
earlier leadership theories, like the ones focused on traits and behaviors. Those earlier
theories aimed to find a one-size-fits-all formula for effective leadership, but they didn’t quite
hit the mark.

Fred Fiedler is the theorist behind the contingency management theory. Fiedler proposed that
the traits of a leader were directly related to how effectively he led. According to Fiedler’s
theory, there’s a set of leadership traits handy for every kind of situation. It means that a
leader must be flexible enough to adapt to the changing environment.

The contingency management theory can be summed up as follows:

 There is no one specific technique for managing an organization.

 A leader should be quick to identify the particular management style suitable for a
particular situation.
 The primary component of Fiedler’s contingency theory is LPC – the least preferred
co-worker scale. LPC is used to assess how well oriented a manager is.

Contingency Theory is a captivating concept that challenges the notion of a one-size-fits-all

approach to leadership. It asserts that the effectiveness of leadership styles depends on the
unique circumstances at hand. Imagine having a toolbox filled with various leadership
approaches, each suited to a specific scenario. This is the essence of Contingency Theory.

Contingency theory firmly understands the fact that our social and business environment is
always subject to change. No single rule or law will solve management problems at all times,
all places and for all individuals or institutions. The business manager has to study the
external environment and define the course of his strategies and action process. The external
environment is not static and rigid, but flexible and fast changing. It is not a constant but a
variable factor.

The main features of the contingency theory :

1. Management is essentially situational. Consequently the techniques of management is

contingent on the situation. If it properly conforms to the demands of the
environment, the technique is effective and fruitful. In other words the diversity and
complexity of the external situation with which the organization interacts alone
should determine which measure or technique is to be chosen to be effective.
2. Management should therefore adopt its approach and strategy in tune to the
requirements of each particular situation. Management policies and practices that
spontaneously are responsive to environmental changes alone would be effective. To
meet this, the organization should design its structure, leadership style, and control
systems should all be oriented to the situation prevailing.
 3. Since management effectiveness and success are directly related to its ability to cope
up with the environment and to the changes overtaking therein, it should sharpen its
diagnostic skills to be proactive and to anticipate and comprehend environmental
changes.
4. In short the successful manager should recognise that there is no one best way or
thumb rule to manage. They must not consider particular management principles and
techniques as applicable to all time and all needs. There are no solution of universal
applicability, as two situations may not be identical.

4. THEORY X AND THEORY Y-By Douglas McGregor

From authoritarian to participative, managers adopt various management styles in supervising

and managing employees. In the 1960s, social psychologist Douglas McGregor developed
Theory X and Theory Y to explain how managers' beliefs about what motivates their
employees can influence their management style. These theories have become the reference
point for various approaches to the issues of human resource administration and organisation.
In this article, we explore McGregor's theory and explain how it applies in the workplace.

Theory X and theory Y are part of motivational theories. Both the theories, which are very
different from each other, are used by managers to motivate their employees.

Theory X gives importance to supervision, while theory Y stresses on rewards and

recognition.

The differences between Theory X and Theory Y are the assumptions made about workers,
supervisor and employee involvement, and organizational structure. Theory X requires more
supervision whereas Theory Y's management involvement is more lax.

Theory X holds a pessimistic view of employees in the sense that they cannot work in the
absence of incentives. Theory Y, on the other hand, holds an optimistic opinion of
employees. The latter theory proposes that employees and managers can achieve a
collaborative and trust-based relationship.

Assumptions of the Theory X manager

Theory X manager holds the following beliefs:

  The average individual has an inherent dislike of work and tries to avoid it as much as
possible.
 Because of this inherent dislike of work, you might want to control, coerce and direct
most people to get them to apply the required effort in achieving organisational
objectives.
 The average individual wants you to direct them, as they have little ambition, avoid
responsibility and want financial security above all.

A Theory X manager closely supervises their employees, with clearly defined tasks and the
promise of higher pay or the threat of punishment as means of motivation. A manager under
these assumptions may use autocratic measures, which can result in mistrust and resentment
among employees. McGregor recognised when this approach can fit but presented it as
flawed in managing employees with social, egoistic needs.

Assumptions of the Theory Y manager

Theory Y managers hold the following beliefs:

 Asserting physical and mental effort in work is as natural to an average individual as

play or rest.
 People don't inherently dislike work but can see it as a source of satisfaction or
punishment under certain conditions.
 Beyond tight control and the threat of punishment, people can exercise self-control
and self-direction in performing the task you commit to them.
 People can commit to organisational objectives because of the personal rewards
associated with their achievement.
 Under the right conditions, people can exhibit the true human trait of seeking and
accepting responsibility.
 People avoid responsibility, lack ambition and emphasise security because of
unfavourable work experience, not inherent human characteristics.
 Everyone can exercise a relatively high degree of ingenuity, imagination and
creativity in solving organisational problems.
 The average individual is yet to use the full extent of their intellectual potentialities
under the conditions of modern industrial life.
Theory Y management style tries to establish a work environment where the organisation's
objectives correlate with the employees' personal objectives. It can lead to a more cooperative
relationship between managers and employees. McGregor acknowledged that this theory isn't
the perfect mindset for every managerial position. Instead, he presented it as an alternative
that persuades managers to abandon the limiting assumptions of Theory X and consider a
more positive mindset.

HOW TO APPLY THEORY X AND Y IN THE WORKPLACE

Although McGregor suggests Theory Y as a better approach to management in a workplace,

some organisations require the attitude of Theory X. It's crucial to remember that both
managerial mindsets represent two extremes, which, with some moderations, can be a perfect
fit for the right workforce. Below are ways to apply each theory to the organisation they
belong to.

1. Setting the right framework

The Theory X managerial style requires a high level of structure where you define and
control every behaviour related to an employee's task. Every employee knows each step
involved in executing their task, what task they are to do each day, when to take a break and
how to manage a shift change.
The Theory Y managerial style involves a loose structure where you barely control every
behaviour related to an employee's task. Employees in this setting get a high level of
autonomy that encourages individualism and creativity for unpredictable tasks. They may not
execute their task or handle their position efficiently if managerial interference is excessive.

2. Decision-making process

In a Theory X power structure, employees have less influence in the workplace. The manager
tells them what to do, giving them little say in the day-to-day operations in the workplace.
The nature of employees' positions and tasks may require the manager to make most of the
decisions; a more democratic approach may hamper productivity. Employees with little
qualification often get predictable tasks with short-term goals and a skilled manager who
handles all the decision-making. In contrast, a Theory Y managerial structure doesn't need the
manager to make all the decisions; the employees often make most of the decisions in the
workplace.
3. Promoting coordination and camaraderie

Employees often have a high level of coordinated efforts among their colleagues under a
Theory X manager. They share so many similarities in career background, prior work
experience and methods of handling job-related issues. You can capitalise on their
commonalities. Putting them on the same team and encouraging the bond among them can
improve their efficiency and productivity. Under a Theory Y manager, employees may not
work in a team. When they do, they may still work separately, with the manager acting as a
coordinator, ensuring their activities integrate.

4. Frequency of supervision and feedback

The tasks a Theory X manager oversees are usually short-term. Employees can complete
them within a day, a week or a month. An example is a manufacturing plant with a daily
production quota, which managers require employees to meet promptly. Employees work
with a deadline regularly and they require constant supervision to ensure they are executing
their tasks on schedule. To ensure a productive workplace, you can give regular feedbacks
and acknowledge your employees' daily efforts. The position of employees with a Theory Y
manager often involves tasks that may take a few months or a few years to complete. A good
example is researchers in a university research department carrying out research that can take
years to complete. Here, managers don't frequently supervise or give feedback to employees
to avoid undue interference. Still, there are a couple of instances where Theory X can be
applied. For instance, large corporations that hire thousands of employees for routine work
may find adopting this form of management ideal.

Where is Theory X applicable?

You may use a Theory X style of management for new starters who will likely need a lot of
guidance, or in a situation that requires you to take control such as a crisis .
Examples of Theory X management practices include;

 close supervision
 rigid rules and regulations, and
 a lack of employee involvement in decision-making.
Where is theory Y applicable?

Impact on Employee Motivation and Performance. In contrast, Theory Y creates a positive

atmosphere, encouraging employees to take initiative and perform at their best.
Implementing Theory Y principles can lead to higher job satisfaction, increased productivity,
and reduced turnover
Examples of Theory Y management practices include;

 trust in employees
 open communication, and
 the encouragement of employee input in decision-making.

WHY STUDY MANAGEMENT THEORIES?

By studying established management theories managers may be able to find ways to increase
productivity and improve their team members’ performance, simplify decision making and
increase collaboration.

1. Increasing Productivity

One of the reasons why managers should be interested in learning management theories is
because it helps in maximizing their productivity. Ideally, the theories teach leaders how to
make the most of the human assets at their disposal. So, rather than purchase new equipment
or invest in a new marketing strategy, business owners need to invest in their employees
through training.

It can be seen in Taylor’s scientific management theory. As mentioned earlier, Taylor

proposed that the best way to boost workers’ productivity was by first observing their work
processes and then creating the best policies.

2. Simplifying Decision Making

Another area where management theories have proven to be useful is in the decision-making
process. Max Weber proposed that hierarchical systems encourage informed decision-
making. A report written by the Institute for Employment Studies suggests that flattening the
hierarchy paves the way for local innovation while speeding up the decision-making process.
Flattening out entails getting rid of job titles and senior positions so as to inspire a cohesive
work environment.

3. Encouraging Staff Participation

Management theories developed in the 1900s, aimed at encouraging interpersonal

relationships in the workplace. One such theory that encouraged a collaborative environment
is the human relations approach. According to this theory, business owners needed to give
their employees more power in making decisions.

ASSIGNMENT ONE, TWO & THREE (15 marks)

a) Differentiate the following functions of management

i) Delegation and staffing
ii) Directing and controlling
iii) Coordination and supervision (6 marks)
b) Analyse between Theory Y and Theory X as proposed by McGregor showing how relevant
its in managing of the organization today
(4Marks)

c) Explain key characteristics/ traits that a manager should possess for effective management
of the organization (5 Marks)