READING PASSAGE 2
You should spend about 20 minutes on Questions 14-26, which are based on Reading
Passage 2 below.
Early Approaches to organisational design
A review of the classical and neoclassical theories of organisational structures
Determining the 'best' type of organisational structure for a particular situation has
long been an important task for managers in all types of organisations. All structures
have advantages and disadvantages and managers luce the challenge of developing
the most appropriate design for changing circumstances.
The Classical Approach
Early management writers attempted to approach organisational design using a set of
principles that would make an organisational structure perform efficiently in most
situations, independent of external conditions and internal objectives. The sociologist
Max Weber and management writers Frederick Taylor and Henri Fayol were major
contributors to this so-called classical approach. They believed that the most efficient
organisations had a legalised formal and hierarchical structure called a 'bureaucracy'.
Members of the organisation were guided by a sense of duty to the organisation and
by a set of rational rules and regulations. According to Weber, such organisations
were characterised by the specialisation of tasks, appointment by merit, and an
impersonal climate.
Today the word 'bureaucracy' sometimes has negative connotations. Early
management writers, however, commended bureaucracy as an organisational design
for its rationality, rules for decision-making, clear chain of command, and promotion of
people based on ability and experience, rather than favouritism or whim. Weber also
believed that clearly specified authority and responsibility made performance easier to
evaluate and reward.
Criticism of the Classical Approach
Weber, Taylor and Fayol developed their theories when organisations that resembled
this bureaucratic model were modern and efficient. It became evident, however, that
some of the major advantages of the bureaucratic structure could become
disadvantages if the theory were applied dogmatically. For example, the safeguards
against favouritism could be rigidly imposed by adhering excessively to rules-resulting
in both managers and subordinates becoming depersonalised.
The classical approach has been criticised from two major perspectives. First, the
theory may not have a basis in reality. Have organisations like those described by
Weber and the others ever existed? Second, it claims that organisations designed and
managed according to bureaucratic principles will enjoy the predicted benefits. But
critics argue that the world no longer fits the assumptions in Weber's model (if it ever
did), and so a bureaucracy might not yield beneficial results.
Early human relations researchers and behavioural scientists attempted to deal with
the major inadequacy of the classical bureaucratic model: neglect of the human
element. They argued that an industrial organisation has two objectives: economic
effectiveness and employee satisfaction. They also wrote that the bureaucratic
structure could be improved by permitting more subordinate participation in decision-
making. Because these researchers tried to improve, and not reject the classical
model. They are sometimes called neoclassical theorists and include Douglas
McGregor, Chris Argyris and Rensis Likert.
The Neoclassical Approach
McGregor believed that the vertical division of labour that characterised bureaucratic
organisations was derived from negative and false assumptions about workers which
he called Theory X'. Managers assume lower-level employees lack ambition and need
orders to work effectively. The rigid formal hierarchy is designed to maintain
managers' power over subordinates. Decision-making takes place at upper levels of
management while the decisions are carried out by people at lower levels. McGregor
argued that organisations based instead on 'Theory Y' assumptions use their
members' potential. Theory Y assumes that most people find work satisfying, commit
themselves willingly to organisational goals and seek responsibility. Members have
more independence than in bureaucratic organisations and lower-level participation in
decision-making is encouraged.
Argyris was concerned that managers in bureaucratic organisations had near-total
responsibility for controlling their subordinates' work. He argued that managerial
domination makes subordinates passive and dependent, and decreases their sense of
responsibility and self-control. Argyris argued for an alternative organisational design
that acknowledged human needs and feelings, and increased workers' satisfaction.
Like McGregor, he favoured giving subordinates more independence and decision-
making power to create a more informal organisational culture.
Likert shared the perspectives of McGregor and Argyris. In his research, he found that
managers who encouraged their subordinates could motivate them more than
traditional authoritarian managers. Likert based on model of four possible systems on
these findings. In System 1 power and authority are distributed strictly according to
the classical management subordinate relationship: a manager gives orders to lower-
level members. In System 4 organisations, by contrast, there is extensive participation
in decision-making and problem-solving groups. Some individuals in each group also
belong to other work groups to ensure communication between them. System 4
represents Likert's view of an ideal organisation.
Criticisms of the Neoclassical Approach
The neoclassical approach to organisational design compensates for limitations in
the traditional classical model, but it has also been criticised. First, the neoclassicists
share the classical assumption that there is one best way to design an organisation.
They overlook environmental, technological, and other variables that might affect an
organisation's design, and overemphasise psychological and behavioural variables.
Second, Theories X and Y oversimplify human motivation and neglect indivdual
differences. Not everyone is motivated by the non-monetary aspects of work, nor is all
work satisfying. Finally, the coordination of work groups to achieve organisational
goals may be more difficult than the neoclassicists suggest, particularly when the
objectives of lower-level employees are not consistent with those of upper-level
managers.
Questions 14 and 15
Choose TWO letters A-E.
Write the correct letters in boxes 14 and 15 on your answer sheet.
According to the writer which TWO of the following are characteristics of the classical
approach to organize design?
A a marked ranking order for employees
B giving importance to everyone's work
C the advancement of older workers
D a neutral working environment
E increased benefits for workers
Questions 16 and 17
Choose TWO letters A-E.
Write the correct letters in boxes 16 and 17 on your answer sheet.
According to the writer, which TWO of the following are criticisms of the classical
approach to organizational design?
A Too many guidelines are proposed
B Certain practices become negative if they are implemented too strictly
C Managers and workers are unable to co-operate with each other
D The administrative standards are unsuited to some work environments
E Positive outcomes which were expected in the past would be unlikely today
Questions 18 and 19
Choose TWO letters A-E.
Write the correct letters in boxes 18 and 19 on your answer sheet.
According to the writer, which TWO of the following are aims of the neoclassical
approach to organizational design?
A to ensure workers are treated as individual people
B to create a formal atmosphere in the workplace
C to change the methods of production
D to allow workers a greater say in what happens at the workplace
E to standardise the procedures for promotion of workers
Questions 20 and 21
Choose TWO letters A-E.
Write the correct letters in boxes 20 and 21 on your answer sheet.
According to the writer, which TWO of the following are criticisms of the neoclassical
approach to organizational design?
A It suggests that workers are involved in too many decisions
B The effects of some psychological factors are given low importance
C The effects of the workplace surroundings are ignored
D It exaggerates the success of the organisations that use this approach
E It assumes that all people work for enjoyment rather than financial gain.
Questions 22-26
Look at the following beliefs (Questions 22-26) and the list of people below.
Match each belief with the correct person A-D.
Write the correct letter, A-D, in boxes 22-26 on your answer sheet.
NB You may use any letter more than once.
List of people
A Max Weber
B Douglas McGregor
C Chris Argyris
D Rensis Likert
22 The classical approach relied upon managers having incorrect views about
workers.
23 In the best organizational model, there is shared decision-making and interaction
between teams at work
24 In an efficient organisation, workers develop expertise in particular areas.
25 An organization must take into account the emotional demands of people.
26 The classical approach allowed workers' skills to be assessed in a straightforward
way.
