Introduction to Management:

Organization
 Organization is a system which operates through
human activity.
 Organizations are very complex social formations,
their links can’t be described with only one theory.
 Organization Theories concerns 3 levels:
 Macro: cooperation among different organization
 Mezzo: structures of the organizations, and influencing
factors
 Micro: behavior of the members of the organizations,
motivation, conflict etc.
What is Management?
 Definition: Management is the process of
Planning, Organizing, Staffing, Directing,
Co-Ordinating, Reporting and Budgeting.
 Manager

A manager achieves objectives through efficient and effective use

of resources.

 Efficient-doing things right

 Effective-doing the right thing
Manager is…

Efficiency
Efficiency
Getting
Getting work
work
done
done through
through
others
others Effectiveness
Effectiveness
Managerial Roles
Interpersonal Informational Decisional

Figurehead
Figurehead Monitor
Monitor Entrepreneur
Entrepreneur

Leader
Leader Disseminator
Disseminator Disturbance
Disturbance
Handler
Handler
Liaison
Liaison Spokesperson
Spokesperson
Resource
Resource
Allocator
Allocator

Negotiator
Negotiator
Managers Functions
Classical Updated
Management Functions Management Functions

Planning
Planning
Making
MakingThings
ThingsHappen
Happen
Organizing
Organizing
Meeting
Meetingthe
theCompetition
Competition
Staffing
Staffing
Organizing
OrganizingPeople,
People,
Leading
Leading Projects,
Projects, and
andProcesses
Processes

Controlling
Controlling
Levels of Management
Top Level Management
CEO
COO
CIO
Middle Level Management
General Mgr
Plant Mgr
Regional Mgr
First-Line
Management Office Manager
Shift Supervisor
Department Manager
Team Leader
Top Managers
Responsible
Responsible for…
for…

Creating
Creating aa context
context for
for change
change

Developing
Developing attitudes
attitudes of
of commitment
commitment
and
and ownership
ownership in
in employees
employees
Creating
Creating aa positive
positive organizational
organizational
culture
culture through
through language
language and
and action
action

Monitoring
Monitoring their
their business
business environments
environments
Middle Managers
Responsible
Responsible for…
for…

Setting
Setting objectives
objectives consistent
consistent with
with top
top
management
management goals,
goals, planning
planning strategies
strategies

Coordinating
Coordinating and
and linking
linking groups,
groups,
departments,
departments, and
and divisions
divisions

Monitoring
Monitoring and
and managing
managing the
the performance
performance
of
of subunits
subunits and
and managers
managers who
who report
report to
to them
them

Implementing
Implementing the
the changes
changes or
or strategies
strategies
generated
generated by
by top
top managers
managers
First-Line Managers

Responsible
Responsible for…
for…

Managing
Managing the
the performance
performance of
of
entry-level
entry-level employees
employees

Teaching
Teaching entry-level
entry-level employees
employees
how
how to
to do
do their
their jobs
jobs

Making
Making schedules
schedules and
and operating
operating plans
plans based
based on
on
middle
middle management’s
management’s intermediate-range
intermediate-range plans
plans
What Companies Look for in
Managers

Technical
Technical Skills
Skills Human
Human Skill
Skill

Conceptual
Conceptual Skill
Skill Design
Design Skill
Skill
Core skills and their use in the
different levels
Managerial levels
Lower Middle Top

Conceptual skills

Human skills

Technical skills
IS management an art or science ?
 ART: Because it depends on the skills,
aptitude & creativity of the manager

 SCIENCE: Because there is considerable

knowledge in the field of management with
basic principles for guidance of basic
activities.
Development of management
thought
Management thought refers to the theories
that guide management of people in the
organisations
Initially,
these theories developed out of
practical experience of managers in the
industrial enterprises. Later on, they borrowed
ideas from other fields of study like science,
anthropology, sociology etc.
Management theories
 Pre-scientific theories

 Classical theories
a.Taylor’s scientific management
theory
b.Fayol’s administrative theory
c.Weber’s bureaucracy theory

 Behavioral theories
a.Human relations theory
b.Behavioral science theory

 Modern management theories

a.Quantitative theory
b.Systems theory
c.Contingency theory
d.Operational theory
Pre-scientific Management
Theories
Important contributions are made by
-Charles Babbage
-James Montgomery
-Robert Owen
-Andrew Ure
-Charles Dupin
-Henry Robinson Towne
-James Watt and Mathew Robinson Boulton Watt
-Captain Henry Metcafe
These theories solved specific organizational
problems but these are not universally accepted
theories that can be applied to all organisations
 Classical theories
They represent early works on management
and focus on increasing industrial output by
providing financial incentives to employees.
The classical approach was developed through
three main streams: Scientific management,
Administrative theory and Bureaucracy
Taylor’s scientific theory
Taylordeveloped his theory on the basis of
his work experience in three companies:
Midvale Steel works, Simond Rolling mills
and Bethlehem Steel company. He is
regarded as Father of Scientific
Management.
He focused on finding the best way to
do the job by eliminating wastage of men
and material. He developed time and
motion studies to find optimum time and
nature of operations for successful
completion of tasks.
Principles of Taylor’s theory
Rule of thumb should be replaced with
science
Thereshould be harmony, not discord in
group actions.
Cooperation, not individualism
Maximum output, not restricted output
Development of workers to their fullest
capacity.
Techniques of scientific
management given by Taylor
Time study
Motion study
Scientific task planning
Standardization and simplification
Differential piece rate system
Functional foremanship
High speed steel
Evaluation of Taylor’s theory

Better management through scientific methods

Discovered true capacity of workers
Scientificselection of workers
 Mental revolution on the part of employers and
employees. In addition to Taylor, several other
persons like Henry L Gantt,
Harington Emerson, Frank Gilbreth and Lillian
Gilbreth also
supported and contributed in scientific management
movement.
Limitations
Unrealistic assumptions
Mechanistic approach
Fayol’s Administrative theory
Fayolfocused on managing the organisation
as a whole rather than lower levels of
organisation only
His theory revolves around
-Activities of a business: Technical,
commercial, financial, security, accounting
and managerial
-Functions of a manager : Planning /
organizing / commanding /coordinating/
controlling.
Principles of management
 Division of work
 Authority and responsibility
 Unity of command
 Unity of direction
 Discipline
 Subordination of individual interest to general
interest
 Remuneration
 Centralization
 Scaler chain
 Order
 Equity
 Stability of tenure of personnel
 Initiative
 Espirit-de-corps
Evaluation of Fayol’s Theory
His principles are widely accepted in
business and non-business world.
He pioneered in highlighting the principles
of management
Criticism
Too formal
Vague

Inconsistency
 Taylor and Fayol – A comparison
Basis of comparison Taylor Fayol
Aim To increase production To increase overall
at the shop level production of the
organization
Focus On improving workers’ On improving overall
output through work administration through
simplification and general principles
standardization
Management View From bottom to top From top to bottom
Results Scientific observation Universal truths
and measurement developed from personal
experiences
Personality Scientist Practitioner
Major contribution Science of industrial A systematic theory of
management management
Perspective Narrow Wider
Aspects studied Micro aspect- Macro aspect-
management of jobs management of total
organaization
Max Weber’s Bureaucracy theory
Max Weber(1864-1920), a German sociologist
introduced the rational-legal authority
system/model to manage the business
organizations. His model is characterized by
- Division of work
- Rules and regulations
- Hierarchy of authority
- Technical competence
- Record keeping
- Impersonal relations
Evaluation of Weber’s theory
 Advantages of specialization
 Rationality leads to efficiency
 Leads to optimum utilization of resources
 Depersonalization leads to equal treatment of all the workers
 Facilitates growth of large scale organizations Limitations
 Ignores the sentiments of human beings
 Hampers human creativity and innovativeness
 Ignores the role of informal organizations
 Strict rules make the organizations procedure- oriented rather
than goal- oriented
 Written rules and regulations deny the benefits of open
communication
 Views organizations as closed systems with little or no
interaction with the environment.
Behavioural theories
Thesetheories focus on organisational goals
along with satisfaction of human needs.
Shift
in focus from workplace conditions to
human side of the organisation
People-
oriented approach substituted the
production- oriented approach
Two important theories:
- Human relations theory
- Behavioural science theory
 Human relations theory
Elton Mayo, the father of Human relation
approach focuses on increasing
organizational productivity by increasing
the morale of workers
Results were obtained through experiments:

- Test room studies

(a)Illumination experiment(light)
(b)Relay assembly room
experiment(Working conditions – room
temperature, humidity, work schedule,
rest breaks and food consumption)
- Interviewing studies
- Observation studies
Results of the experiment
Informal groups are important complements
to formal groups
Social groups are more important than
financial incentives to motivate the workers
Worker is a social man rather than rational
man motivated by financial incentives
Work is considered as a group activity
and not as operations performed by
individuals.
Socialand psychological factors influence
employee behaviour and productivity more
than physical work conditions
Evaluation of the theory
Focus on organizational efficiency through
satisfaction of social and psychological needs of
the workers
Participative management is better than
authoritarian management.
Design of the theory: social needs are
secondary to physiological needs
Analysis of the theory: group dynamics may not
be as important as emphasized upon.
Interpretation of the theory: cordial relations
are over emphasized . Conflict of opinion also
generates new ideas
Human relations philosophy: informal relations
Behavioural science theory
Itapplies scientific vision to human relations
theory
Concepts from Psychology, Sociology and
Anthropology are applied to study human
behaviour
Psychology – Study of individual behaviour
Sociology – Study of human behaviour in
groups
Anthropology - Study of human behaviour as
Continued……………..
Several sociologists and psychologists like
Abraham Maslow, Federick Herzberg, MC
Gregor, Douglas, Rensis Likert, Kurt
Lewin, Keith davis, Charles Angris,George
Homans and others have made significant
contribution to the development
of this approach.
Thisapproach is an extension and
improvement of human relations
movement. As this approach suggested
that individuals differ in their attitudes,
perceptions, their needs and goals also
Human relations theory and
Behavioural science theory- A
comparison
Human relations Behavioural Approach

1.Focus on individual behaviour and Focus on groups and group

behaviour needs.
2.Emphasizes on interpersonal Emphasizes on group
relationships. relationships.
3.Views worker as ‘social man’ Views worker as ‘self
actualising man’group
4. Always views Views group conflict as a source
conflict as a negative force. of new ideas and innovations.
5. Views organisation as a social Views organisation as a socio-
system technical system
6.Emphasis on motivation, 6.Emphasis on group
morale, and job satisfaction dynamics and informal
organisation structure
6. Narrow scope as Wide scope as based on
based on Hawthrone Human relations
Modern management theories
 These theories are responsive to environment
 changes
They view organizations as dynamic open systems
 having multiple objectives
Management is multi-disciplinary and draws
 knowledge from various fields to solve complex
business problems
They forecast environment changes through
 scientific techniques and discount them to the
present business situations
These theories include:
-Quantitative theory
-Systems theory
Quantitative theory
Ituses the services of quantitative specialists
to apply inter-disciplinary techniques to
solve business problems
It includes:
- Management science: it uses mathematical
models like PERT, CPM, Simulation etc. to
solve business problems.
- Operations management: It applies
quantitative techniques of inventory
management, statistical quality control etc.
to manage the production and delivery of
 Continued………
-Management information system: It uses
computer based information to make
business decisions
Evaluation of Quantitative
theory
It
uses quantifiable data to frame
mathematical models and handles complex
decision- making problems
It uses comprehensive information through
computers which could not otherwise have
been available
Limitations
-It cannot be applied to study human
behaviour as it cannot be predicted through
mathematical equations
Continued………….
- All the variables affecting the business
decisions cannot be quantified in
numeric terms
- It may land up making satisfying
decisions rather than optimum decisions
because of constraints of time and cost
to collect the relevant data.
Systems Approach
As per this approach organisation
is viewed from a systems
point of view.
The main elements of systems
approach are as follows:
 Organisation as a purposeful
system consisting of several
interconnected and interdependent parts.
 The parts or components of a system are
called sub- systems.
 The position and function of each subsystem
can be analyzed and understood only in
relation to the other sub-systems and to the
organisation as a whole.
 Feedback is useful in evaluating and
improving the functioning of the system.