By Vernon Hall,2014-01-24 11:13
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    CHAPTER 2 MANAGEMENT TODAY AND YESTERDAY Historical Background of Management

     Ancient Management

     Egypt (pyramids) and China (Great Wall)

     Adam Smith

     Published “The Wealth of Nations” in 1776

    ; Advocated the division of labor (job specialization) to increase the

    productivity of workers

     Industrial Revolution

     Substituted machine power for human labor

     Created large organizations in need of management

    Development of Major Management Theories

Major Approaches to Management

     Scientific Management

     General Administrative Theory

     Quantitative Management

     Organizational Behavior

     Systems Approach

     Contingency Approach

    Scientific Management

     Fredrick Winslow Taylor

     The father of scientific management

     Published Principles of Scientific Management (1911)

    ; The theory of scientific management

     Using scientific methods to define the one best way for a job

    to be done:

     Putting the right person on the job with the correct tools

    and equipment.

     Having a standardized method of doing the job.

     Providing an economic incentive to the worker.

    Taylors Five Principles of Management

    1. Develop a science for each element of an individual’s work, which will replace the

    old rule-of-thumb method.

    2. Scientifically select and then train, teach, and develop the worker. 3. Heartily cooperate with the workers so as to ensure that all work is done in

    accordance with the principles of the science that has been developed. 4. Divide work and responsibility almost equally between management and workers.

    5. Management takes over all work for which it is better fitted than the workers.

    Frank and Lillian Gilbreth

    1. Focused on increasing worker productivity through the reduction of wasted


    2. Developed the microchronometer to time worker motions and optimize


    How Do Todays Managers Use Scientific Management?

    3. Use time and motion studies to increase productivity

    4. Hire the best qualified employees

    5. Design incentive systems based on output

    General Administrative Theorists

     Henri Fayol

     Believed that the practice of management was distinct from other organizational


     Developed fourteen principles of management that applied to all organizational


     Max Weber

     Developed a theory of authority based on an ideal type of organization


    ; Emphasized rationality, predictability, impersonality, technical

    competence, and authoritarianism

    Fayols 14 Principles of Management

    1. Authority.

    2. Discipline.

    3. Unity of command.

    4. Unity of direction.

    5. Subordination of individual interest to the interests Division of work. 6. of the organization.

    7. Remuneration.

    8. Centralization.

    9. Scalar chain.

    10. Order.

    11. Equity.

12. Stability of tenure of personnel.

    13. Initiative.

    14. Esprit de corps.

    Webers Ideal Bureaucracy

Quantitative Approach to Management

     Quantitative Approach

     Also called operations research or management science

     Evolved from mathematical and statistical methods developed to solve WWII

    military logistics and quality control problems

     Focuses on improving managerial decision making by applying:

    ; Statistics, optimization models, information models, and computer


Understanding Organizational Behavior

     Organizational Behavior (OB)

     The study of the actions of people at work; people are the most important asset of

    an organization

     Early OB Advocates

     Robert Owen

     Hugo Munsterberg

     Mary Parker Follett

     Chester Barnard

    The Hawthorne Studies

     A series of productivity experiments conducted at Western Electric from 1927 to 1932. Experimental findings

     Productivity unexpectedly increased under imposed adverse working conditions.

     The effect of incentive plans was less than expected.

     Research conclusion

     Social norms, group standards and attitudes more strongly influence individual

    output and work behavior than do monetary incentives.

    Early Advocates of OB

The Systems Approach

     System Defined

     A set of interrelated and interdependent parts arranged in a manner that produces

    a unified whole.

     Basic Types of Systems

     Closed systems

    ; Are not influenced by and do not interact with their environment (all

    system input and output is internal).

     Open systems

    ; Dynamically interact to their environments by taking in inputs and

    transforming them into outputs that are distributed into their


    The Organization as an Open System

Implications of the Systems Approach

     Coordination of the organizations parts is essential for proper functioning of the entire


     Decisions and actions taken in one area of the organization will have an effect in other

    areas of the organization.

     Organizations are not self-contained and, therefore, must adapt to changes in their

    external environment.

    The Contingency Approach

     Contingency Approach Defined

     Also sometimes called the situational approach.

     There is no one universally applicable set of management principles (rules) by

    which to manage organizations.

     Organizations are individually different, face different situations (contingency

    variables), and require different ways of managing Popular Contingency Variables

     Organization size

     Routineness of task technology

     Environmental uncertainty

     Individual differences

    Current Trends and Issues



     Workforce Diversity



     Knowledge Management

     Learning Organizations

     Quality Management


     Management in international organizations

     Political and cultural challenges of operating in a global market Ethics

     Increased emphasis on ethics education in college curriculums

     Increased creation and use of codes of ethics by businesses A Process for Addressing Ethical Dilemmas

    Step 1: What is the ethical dilemma?

    Step 2: Who are the affected stakeholders?

    Step 3: What personal, organizational, and

     external factors are important to

     my decision?

    Step 4: What are possible alternatives?

    Step 5: Make a decision and act on it.

    Workforce Diversity

     Increasing heterogeneity in the workforce

    ; More gender, minority, ethnic, and other forms of diversity in employees

     Aging workforce

    ; Older employees who work longer and do not retire

    ; The increased costs of public and private benefits for older workers

    ; An increasing demand for products and services related to aging. Entrepreneurship Defined

     The process whereby an individual or group of individuals use organized efforts

    to create value and grow by fulfilling wants and needs through innovation and


    Entrepreneurship process

     Pursuit of opportunities

     Innovation in products, services, or business methods

     Desire for continual growth of the organization

    E-Business (Electronic Business)

     The work preformed by an organization using electronic linkages to its key


     E-commerce: the sales and marketing component of an e-business Categories of E-Businesses

     E-business enhanced organization

     E-business enabled organization

     Total e-business organization

    Knowledge Management

     The cultivation of a learning culture where organizational members

    systematically gather and share knowledge with others in order to achieve better


    Learning Organization

     An organization that has developed the capacity to continuously learn, adapt, and


    Learning Organization versus Traditional Organization

Quality Management

     A philosophy of management driven by continual improvement in the quality of

    work processes and responding to customer needs and expectations

     Inspired by the total quality management (TQM) ideas of Deming and Juran

     Quality is not directly related to cost

    What is Quality Management?

    Intense focus on the customer

    Concern for continual improvement


    Improvement in the quality of everything

    Accurate measurement

    Empowerment of employees


    Parameters of Managerial Discretion

The Organizations Culture

     Organizational Culture

     A system of shared meanings and common beliefs held by organizational

    members that determines, in a large degree, how they act towards each other.

     Organizational Culture

     The way we do things around here.

     Values, symbols, rituals, myths, and practices

     Implications: Culture is a perception. Culture is shared. Culture is descriptive.

    Dimensions of Organizational Culture

    Strong versus Weak Cultures

     Strong Cultures

     Are cultures in which key values are deeply held and widely held.

     Have a strong influence on organizational members. Factors Influencing the Strength of Culture

     Size of the organization

     Age of the organization

     Rate of employee turnover

     Strength of the original culture

     Clarity of cultural values and beliefs

    Benefits of a Strong Culture

    1. Creates a stronger employee commitment to the organization. 2. Aids in the recruitment and socialization of new employees. 3. Fosters higher organizational performance by instilling and promoting employee


    Organizational Culture

     Sources of Organizational Culture

     The organizations founder

    ; Vision and mission

     Past practices of the organization

    ; The way things have been done

     The behavior of top management

     Continuation of the Organizational Culture

     Recruitment of like-minded employees who fit

     Socialization of new employees to help them adapt to the culture

    How an Organizations Culture Is Established and Maintained

    How Employees Learn Culture


     Narratives of significant events or actions of people that convey the spirit of

    the organization


     Repetitive sequences of activities that express and reinforce the values of the


     Material Symbols

     Physical assets distinguishing the organization


     Acronyms and jargon of terms, phrases, and word meanings specific to an


    How Culture Affects Managers

     Cultural Constraints on Managers

     Whatever managerial actions the organization recognizes as proper or

    improper on its behalf

     Whatever organizational activities the organization values and encourages

     The overall strength or weakness of the organizational culture

    Simple rule for getting ahead in an organization:Find out what the

    organization rewards and do those things.

    Organization Culture Issues

     Creating an Ethical Culture

     High in risk tolerance

     Low to moderate aggressiveness

     Focus on means as well as outcomes

Creating an Innovative Culture

     Challenge and involvement


     Trust and openness

     Idea time


     Conflict resolution



    Organization Culture Issues

     Creating a Customer-Responsive Culture

     Hiring the right type of employees (ones with a strong interest in serving


     Having few rigid rules, procedures, and regulations

     Using widespread empowerment of employees

     Having good listening skills in relating to customers messages

     Providing role clarity to employees to reduce ambiguity and conflict and

    increase job satisfaction

     Having conscientious, caring employees willing to take initiative

    Defining the External Environment

     External Environment

     The forces and institutions outside the organization that potentially can

    affect the organizations performance.

     Components of the External Environment

     Specific environment: external forces that have a direct and immediate

    impact on the organization.

     General environment: broad economic, socio-cultural, political/legal,

    demographic, technological, and global conditions that may affect the


    The External Environment

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