Introduction to Management, its Functions, and Organisations

CONTENTS

History of Management Management Theories and Schools of

Thought Key People

What is Management? Management Functions What do Managers do? Management Roles Management Skills Managing Today

"People who ignore the past are destined to relive it."

A person unaware of mistakes made by others is likely to repeat

them.

Each generation of managers needs to understand the lessons learned by its predecessors and

build on them.

History of Management

Ancient HistoryEarly

CivilisationsEgyptian

pyramids

History of Management

Modern History Adam Smith publishes

The Wealth of Nations • Division of Labour

Industrial Revolution Managers needed skills to:

• Forecast demand

• Ensure that the necessary material resources were available and on hand for producing goods in question

• Assign tasks to people

• Ensure that machines were kept in good working condition

• Find markets for the finished products

Management Theories and Schools of Thought

MANAGEMENT THEORIES Classical

• Scientific • Administrative

Behavioural Quantitative System Quality

CLASSICAL MANAGEMENT THEORY

Classical Management Theory originated during the Industrial Revolution. It has two branches – Classic Scientific and Classic Administrative.

Classic Scientific SchoolArose as a result of a need to increase productivityThe emphasis was to try to find the “one best way” of getting work done by examining the way work was accomplishedFocused on worker-machine relationships for increasing production

Classic Administrative SchoolGrew out of a need for guidelines to manage the complex organisations that emerged from the Industrial RevolutionThe emphasis was on the development of managerial principles rather than work methodsAdvocated a belief in studying the flow of information Theorists aimed at understanding how an organisation operated

BEHAVIOURAL MANAGEMENT THEORY

Dealt with the human aspects of organisations

Focused on employees as individuals, resources, assets, and as part of work groups

Motivation and Leadership became topics of great interest

Resulted in the creation of positions for professionals as a Human Resources Manager

QUANTITATIVE MANAGEMENT THEORY

Was born in World War II era

Used mathematical and statistical approaches, as well as computational models and simulations for management problems

Used quantitative tools to help plan and control nearly every aspect in the organisation

SYSTEMS MANAGEMENT THEORY

An organisation is viewed as a system, with inputs being processed, through operations, into outputs. So a system is a set of interrelated parts that work together to achieve stated goals.

Systems SchoolThe systems school holds that an organisation comprises various parts (subsystems) that must perform tasks necessary for the survival and proper functioning of the system as a wholeThe Functional Areas of business – Marketing, Finance, Human Resource Management, etc. – are subsystemsInterrelatedness emphasises that a manager can’t change one subsystem without affecting the rest

Cumulative Energy of SynergyThe whole is greater than the sum of its partsSynergy is the increased effectiveness that results from combined action or co-operationIt is sometimes described as 2 + 2 = 5 since the result of a synergistic partnership is more than the sum production of each partner aloneSynergy can lead to negative effects (clash of cultures, loss of jobs (mergers & downsizing), antitrust and ethical issues, etc.)

QUALITY MANAGEMENT THEORY

Quality Management emphasises achieving customer satisfaction by providing high quality goods and servicesWhat is done must be measured and evaluated quantitatively and qualitativelyQuality School is the most current and it is embraced worldwide

Kaizen

Japanese in origin (means continuous improvement for people, products, and processes)No matter how well things are going, the individual or organisation can do it better

Reengineering

Change is constant; It will always occurIs the fundamental rethinking and radical redesign of business processes to achieve dramatic improvements

Key People

Frederick W. Taylor (1856-1915)

Called the Father of Scientific Management

Scientifically studied work to identify the “one best way” to get a job done (standardising tasks)

Scientifically selected, hired, and trained workers

Motivated workers with financial rewards (prorata)

Introduced work breaks

Key People

Henry Gantt (1861-1919)

Developed the Gantt chart used for scheduling multiple overlapping tasks over a time period (still widely used in organisations today for scheduling work)

Focused on motivational schemes, emphasising the greater effectiveness of rewards for good work

Developed a pay incentive system with a guaranteed minimum wage and bonus systems for people on fixed wages

Key People

Henri Fayol (1841-1925)

Believed that management required specific skills that could be learned and taught

Designated management as a universal set of functions that included planning, organising, commanding, co-ordinating, and controlling

Described the practice of management as something distinct from accounting, finance, production, and the other business functions

Developed several principles of management

Key People

Mary Parker Follett (1868 - 1933)

Focused on how organisations cope with conflict

Emphasised the human element in organisations and the need to discover and enlist individual and group motivation

Introduced three important concepts: The Universal Goal The Universal Principle The Law of the Situation

Key People

Max Weber (1864-1920)

Known as the Father of Modern Sociology

Analysed bureaucracy as the most logical and rational structure for large organisations

A bureaucracy was a system characterised by division of labour, a clearly defined hierarchy, detailed rules and regulations, and impersonal relationships

Key People

Chester Barnard (1886-1961)

Saw organisations as social systems requiring human co-operation

Argued that success depended on maintaining good relations with external groups and institutions

Developed the concepts of Strategic Planning and Acceptance Theory of Authority

Argued that managers must gain acceptance for their authority

Believed that three top functions of the executive were to:

establish and maintain effective communication system,

hire and retain effective personnel, and motivate those personnel

Key People

Abraham Maslow (1908- 1970)

Developed a needs-based theory of motivation (Hierarchy of Needs)

The theory is now considered central to understanding human motivation an behaviour

Key People

W. Edwards Deming (1900- 1994)

Father of Total Quality Management

Regarded by the Japanese as the key influence in their postwar economic turnaround

Created constancy of purpose for continual improvement of products and services

What is Management?

Management is the process of getting things done,

effectively and efficiently, through and with other people.

(Robbins, DeCenzo, Stuart-Kotze,2002)

Efficiency & Effectiveness

Efficiency means doing a task correctly.

Effectiveness is the attainment of a goal.

Efficiency & Effectiveness

What is the difference exactly?

Efficiency is how you go about accomplishing something (means), while

Effectiveness is the attainment or completion of a goal (ends).

Efficiency & Effectiveness

Example:If you kill a fly with a hammer you may be effective (ends - killing the fly). But you would be much more efficient by using a fly swatter (means – waste less energy, swat faster).

Management Functions

Management Functions are activities that comprise the Management Process.

The four basic Management activities are PlanningOrganisingLeadingControlling

Management Functions

Planning - involves defining an organisation's goals, establishing an overall strategy for achieving these goals, and developing a set of plans to integrate and co-ordinate activities.

Setting goals keeps the work to be done in proper focus and helps organisation members keep their attention on what is important.

Management Functions

Managers are also responsible for designing an organisation's structure.

Organising - involves determining what jobs or tasks are to be done, hiring and choosing who is going to do them, and deciding how they will be done.

Management Functions

Leading - is influencing other people to get the job done.

Leaders direct the activities of others, motivate employees, maintain morale, mold company culture, and manage conflict and communication.

Management Functions

Controlling - is making sure that an organisation's performance is up to par with the goals previously set.

A manager must continuously monitor and compare actual performance with set standards and take corrective action when necessary.

What do Managers do?

A manager is someone who plans, organises, leads, and controls people and the work of an organisation with the aim of ensuring that the organisation achieves its goals

(Dessler, Tarke, Cyr, 2001)

Types of Manager

There are several ways to classify managers. The three most common classifications are by Organisational LevelManagerial FunctionRegion or Divison

Management Roles

Interpersonal Figurehead Leader Liaison

Informational Monitor Disseminator Spokesperson

Decisional Entrepreneur Disturbance Handler

Management skills

Technical Conceptual Political Communication Interpersonal Effectiveness

Managing Today

Managers need to constantly monitor and anticipate changes occurring in today’s volatile business environment. Organisations are facing many new challenges and forces in today’s more competitive global marketplace.

Some of the most significant challenges and trends include: Technological Innovations Globalisation A more Diverse Workforce Changing Political Systems Formation of new Trade Agreements/Areas Synergy