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Chapter 2: Learning from the History of Management Thought

Don Hellriegel. Susan E. Jackson. John W. Slocum, Jr. MANAGING: A COMPETENCY BASED APPROACH 11 th Edition. Chapter 2: Learning from the History of Management Thought. Prepared by Argie Butler Texas A&M University. Learning from the History of Management Thought. Learning Goals.

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Chapter 2: Learning from the History of Management Thought

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  1. Don Hellriegel Susan E. Jackson John W. Slocum, Jr. MANAGING: A COMPETENCY BASED APPROACH 11th Edition Chapter 2: Learning from the History of Management Thought Prepared by Argie Butler Texas A&M University

  2. Learning from the History ofManagement Thought Learning Goals • Describe the three branches of the traditional viewpoint of management: Bureaucratic, Scientific, and Administrative 2. Explain the behavioral viewpoint’s contribution to management Chapter 2: PowerPoint 2.1

  3. Learning Goals (cont’d) 3. Describe how managers can use systems and quantitative techniques to improve employee performance 4. State the two major components of thecontingency viewpoint 5. Explain the impact of the need for quality on management practices Chapter 2: PowerPoint 2.2

  4. Traditional Viewpoint • Administrative Management Goals:EfficiencyConsistency • Bureaucratic Management • ScientificManagement Chapter 2: PowerPoint 2.3

  5. History of Management Thought Quality Viewpoint Contingency Viewpoint Systems Viewpoint Behavioral Viewpoint Traditional Viewpoint 1890 1900 1910 1920 1930 1940 1950 1960 1970 1980 1990 2000 Chapter 2: PowerPoint 2.4 (Adapted from Figure 2.1)

  6. Bureaucratic Management • Use of rules, hierarchy, a clear division of labor, and detailed procedures to guide employees’ behaviors • Seven characteristics • Rules—formal guidelines for the behavior of employees on the job • Impersonality—employees are evaluated according to rules and objective data • Division of Labor—splitting work into specialized positions Chapter 2: PowerPoint 2.5

  7. Bureaucratic Management (cont'd) • Hierarchical Structure—ranks jobs according to the amount of authority in each job • Authority—who has the right to make decisions of varying importance at different organizational levels • Traditional authority • Charismatic authority • Rational, legal authority • Lifelong Career Commitment—both the employee and the organization view themselves committed to each other over the working life of the employee • Rationality—the use of the most efficient means available to accomplish a goal Chapter 2: PowerPoint 2.6

  8. Snapshot “Each job has a policy manual detailing the rules that a person needs to follow to ensure efficiency. Drivers are told to walk to a customer’s door at a brisk pace of 3 feet per second, carrying the package in the right hand and clipboard in the left. They should knock on the door so as not to lose valuable seconds searching for a doorbell.” Michael Eskew Chairman and CEO, UPS Chapter 2: PowerPoint 2.7

  9. Bureaucratic Continuum LOW MIDRANGE HIGH DreamWorks Sony IRS MP3 PepsiCo State Motor Vehicle Registration R&D Thinktank 7-11 McDonalds Chapter 2: PowerPoint 2.8 (Adapted from Figure 2.3)

  10. Potential Benefits of Bureaucracy • Efficiency • Consistency • Functions best when routine tasks are performed • Performance based on objective criteria • Most effective when • Large amounts of standard information have to be processed • The needs of the customer are known and are unlikely to change • The technology is routine and stable (e.g., mass production) • The organization has to coordinate the activities of employees in order to deliver a standardized service/product to the customer Chapter 2: PowerPoint 2.9

  11. Potential Costs of Bureaucracy Protection of authority Slow decision making Rigid rules andred tape Incompatible withchanging technology Incompatible with21st century workers’ values for freedom and participative management Chapter 2: PowerPoint 2.10

  12. Scientific Management • A philosophy and set of management practices that are based on fact and observation, not on hearsay or guesswork • Frederick W. Taylor • Believed increased productivity depended on finding ways to make workers more efficient • Used time-and-motion studies to analyze work flows, supervisory techniques, and worker fatigue • Used functional foremanship, a division of labor that assigned eight foremen to each work area • Assumed workers motivated by money Chapter 2: PowerPoint 2.11

  13. Scientific Management • The Gilbreths • Frank Gilbreth used motion picturesto analyze workers’ motions • Lillian Gilbreth championed protecting workers from unsafe working conditions • Henry Gantt • Focused on control systems for production scheduling (Gantt Chart) Chapter 2: PowerPoint 2.12

  14. Insights from Scientific Management • Many companies have used scientific management principles to improve efficiency, employee selection and training • Scientific management failed to recognize the social needs of workers and the importance of working conditions and job satisfaction Chapter 2: PowerPoint 2.13

  15. Snapshot “Walgreens is constantly pushing to drive costs down. It pioneered the application of satellite communications and computer technology and linked these to increase store efficiency. By using tried-and-proven management concepts, each of its 6,100 stores [is] able to process around 280 prescriptions a day and beat Wal-Mart by 27 cents and CVS by 94 cents on each prescription.” David Berbauer CEO, Walgreens Chapter 2: PowerPoint 2.14

  16. Administrative Management: Overview • Focuses on the manager and basic managerial functions of planning, organizing, controlling and leading • Unity of Command Principle: an employee should report to only one manager • Authority Principle: managers have the right to give orders to get things done Chapter 2: PowerPoint 2.15

  17. Behavioral Viewpoint: Overview • Focuses on dealing effectively with the human aspects of organizations • Started in the 1930’s • Emphasis on working conditions • Workers wanted respect • Workers formed unions to bargain with management Chapter 2: PowerPoint 2.16

  18. Mary Parker Follett’s Contributions • Managers need to communicate with workers • Workers should participate in solving problems Goal:Improve Coordination • Managers need to establish good working relationships with employees Chapter 2: PowerPoint 2.17

  19. Snapshot “Managers need to have a common touch and to be a team leader and not adrill sergeant. When their people shine, they shine.” Vickie Yoke, Senior Vice President, Alcatel Chapter 2: PowerPoint 2.18

  20. Chester Barnard’s Contributions • People should continuously communicateand cooperate with one another • Acceptance theory of authorityholds that employees have free wills and, thus, choose whether to follow management’s orders. Employees will follow orders if they: • Understand what is required • Believe the orders are consistent with organization goals • See positive benefits to themselves in carrying out the orders Chapter 2: PowerPoint 2.19

  21. Hawthorne's contributions Productivity increases occur when managers recognize employee feelings Informal work groups control productivity Hawthorne effect: when employees are given special attention, productivity changes Peer pressure to conform to norms is important Chapter 2: PowerPoint 2.20

  22. Lessons from the Behavioral Viewpoint Employees are motivated by social needs and association with others Employees’ performance is more a result of peer pressure than management’s incentives and rules Employees want to participate in decisions that affect them Managers need to involve subordinates in coordinating their work to improve efficiency Chapter 2: PowerPoint 2.21

  23. Snapshot “Teamwork is one of the most beautifulexperiences in life. Teamwork is ourcore value and a primary way that theContainer Store enriches the qualityof employees’ work life.” Kip Tindell, President, The Container Store Chapter 2: PowerPoint 2.22

  24. Systems Viewpoint: Systems Concepts • System: an association of interrelated and interdependent parts • Systems viewpoint: an approach to solving problems by diagnosing them within a framework of transformation processes, outputs, and feedback Chapter 2: PowerPoint 2.23

  25. Basic Systems View of Organizations Inputs Human, physical,financial, and information resources TransformationProcess Outputs Productsandservices Feedback Loops Chapter 2: PowerPoint 2.24 (Adapted from Figure 2.4)

  26. System Types • Closed system: limits its interactions with the environment (e.g., stamping department in GM assembly plant) • Open system: interacts with the external environment (e.g., marketing department) Chapter 2: PowerPoint 2.25

  27. Quantitative Techniques Primary focus is on decision making Alternatives are based on economic criteria Mathematical models are used to simulate changes Computers are essential Chapter 2: PowerPoint 2.26

  28. Quantitative Techniques Emphasis on objective criteria for decision making Focus on planning Lead to creation of blogs Enables managers to simulate conditions Chapter 2: PowerPoint 2.27

  29. Contingency Viewpoint: Overview • Management practices should be consistent with the requirements of the external environment, the technology used to make a product or provide a service, and capabilities of the people who work for the organization • Uses concepts of the traditional, behavioral and system viewpoints Chapter 2: PowerPoint 2.28

  30. Contingency Variables • External environment—stable or changing • Technology—simple or complex • People—ways they are similar and different from each other Chapter 2: PowerPoint 2.29

  31. Contingency Viewpoint: Draws on Other Viewpoints, As Necessary Behavioral Viewpoint How managers influence others; • Informal group • Cooperation among employees • Employee’s social needs Traditional Viewpoint What managers do: • Plan • Organize • Lead • Control Systems Viewpoint How the parts fit together. • Inputs • Transformations • Outputs Contingency Viewpoint Managers’ use of other viewpoints to solve problems involving: • External environment • Technology • Individuals Chapter 2: PowerPoint 2.30 (Adapted from Figure 2.5)

  32. Quality Viewpoint: Overview • Quality: how well a product or service does what it is supposed to do—how closely and reliably it satisfies the specifications to which it is built or provided • Total Quality Management (TQM): a philosophy that makes quality values the driving force behind leadership, design, planning, and improvement initiatives Chapter 2: PowerPoint 2.31

  33. Quality Control Process • Inputs or raw materials • Operations • Statistical process control • Quality of a process (e.g., sigma) • Outputs • Measuring by variable or a product’s characteristics • Measuring by attribute or a product’s acceptable/ unacceptable characteristics Chapter 2: PowerPoint 2.32

  34. Learning from the Quality Viewpoint Positive Company Image Lower Costs and Higher Market Share Decreased Product Liability Quality Chapter 2: PowerPoint 2.33 (Adapted from Figure 2.6)

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