Session 4: Management and different organizational forces

Studying history within the realm of management involves understanding how past events and
societal forces have shaped organizations and their practices. It goes beyond simply arranging
events in chronological order and focuses on developing strategic thinking, a broad vision, and
enhanced conceptual skills. By examining historical influences, managers can gain insights into
how to navigate current and future challenges in the business environment.
1. Social Forces: Social forces refer to cultural aspects that guide relationships, values,
needs, and behavior standards among people within a society. These forces shape the
social contract, which consists of the unwritten rules governing interactions between
employees and management. A key social force today is the influence of Generation Y
(Nexters), who are technologically adept, globally conscious, and value work/life
balance, challenging work environments, and career growth opportunities. Their
preferences have driven trends such as telecommuting, flextime, shared jobs, and
organization-sponsored sabbaticals.
2. Political Forces: Political forces encompass the influence of political and legal
institutions on organizations. These forces include fundamental assumptions about
self-government, property rights, justice, and legal decisions. The spread of capitalism
globally has significantly altered the business landscape, requiring organizations to adapt
to new realities, such as the dominance of free-market systems and increasing global
interdependencies. Additionally, political forces can pose challenges, such as
anti-American sentiments in various regions, which affect the operations of U.S.
companies.
3. Economic Forces: Economic forces pertain to the availability, production, and
distribution of resources within a society. These forces are crucial for organizations as
they navigate the allocation of scarce resources. Recent trends include the growing
economic power of less-developed countries like China and India, which are reshaping
the global marketplace. In developed countries, the economy has shifted toward one
based on ideas, information, and knowledge, with digital technology revolutionizing
supply chains and resource distribution.
Management Adaptation to Societal Changes: As social, political, and economic forces
evolve, so do management practices. Managers must continuously adapt to changing
circumstances, often seeking new ideas and techniques to keep their organizations relevant and
vital. The rapid pace of societal change has shortened the life cycles of management ideas,
requiring ongoing innovation and flexibility in management approaches.
Contemporary Challenges in Management: Modern managers face a range of contemporary
challenges, including economic instability, environmental crises, and public skepticism
stemming from corporate scandals. These challenges compel managers to seek both new and
traditional management tools to optimize limited resources and maintain organizational
effectiveness in a turbulent environment.
Session 4: Classical perspective of management (scientific management, bureaucratic
organizations, Fayol’s administrative principles)
The Evolution of Management Perspectives: Over time, significant management perspectives
have evolved in response to societal forces. Each perspective reflects the dominant period’s
context but retains relevance in today’s organizations. The evolution of these perspectives
demonstrates the enduring impact of historical and societal influences on management practices,
highlighting the importance of understanding history in the context of organizational behavior.
1. Scientific Management: A subfield of the classical management perspective that emphasized
scientifically determined changes in management practices as the solution to improving labor
productivity.
1.1. Definition of Scientific Management:

● Emphasis: Scientific management focuses on scientifically determined jobs and

management practices to improve efficiency and labor productivity.
● Origin: Introduced by Frederick Winslow Taylor in the late 1800s.

1.2. Taylor's Core Principles:

● Worker Retooling: Taylor believed workers could be retooled like machines, optimizing
their physical and mental capabilities for better productivity.
● Scientific Study: He proposed that management practices should be based on scientific
study rather than rules of thumb or tradition.
● System Over Individual: Taylor emphasized that the system should take precedence
over individual preferences, encapsulated in his quote,

"In the past the man has been first. In the future, the system must be first."

1.3. Practical Application: Bethlehem Steel Example:

● Taylor demonstrated his principles by improving the process of unloading and reloading
steel at Bethlehem Steel in 1898.
● By optimizing movements, tools, and sequencing, he increased productivity from 12.5
tons per day per worker to 47.5 tons.
● Introduced an incentive system that increased workers' pay, leading to a significant boost
in productivity.

1.4. Implementation of Scientific Management: Steps for Managers:

● Develop standard methods for performing each job.

● Select workers with the appropriate skills and abilities.
● Train workers in these standard methods.
 ● Support workers by eliminating interruptions and providing a conducive work
environment.
● Offer wage incentives to motivate workers and enhance productivity

1.5. Impact and Legacy:

● Industrial Impact: Scientific management dramatically increased productivity across

various industries and remains influential today.
● Modern Relevance: The principles of maximizing efficiency and organizing work for
productivity are still deeply embedded in modern management practices. Harvard
Business Review lists scientific management as one of the top innovations that shaped
modern management.

1.6. Criticism and Drawbacks:

● Neglect of Social Context: Scientific management was criticized for ignoring the social
context of work and the needs of workers.
● Conflict: This approach sometimes led to increased conflict and clashes between
management and workers, who often felt exploited, contrary to the harmony and
cooperation envisioned by Taylor.

2. Bureaucratic Organization Approach: A subfield of the classical management perspective

that emphasized management on an impersonal, rational basis through such elements as clearly
defined authority and responsibility, formal record keeping, and separation of management and
ownership.

2.1. Historical Context:

● In the late 1800s, many European organizations were managed on a personal, family-like
basis.
● Employees showed loyalty to individuals rather than the organization or its mission,
leading to misuse of resources for personal gain rather than organizational goals.

2.2. Weber's Vision:

● Max Weber introduced the concept of bureaucracy as an impersonal, rational way to

manage organizations.
● He believed this approach would improve efficiency and adaptability to change.

2.3. Characteristics of Bureaucracy (according to Weber):

1. Impersonality: Management is based on rationality rather than personal relationships.

2. Rational Authority: Decisions are made based on competence and technical
qualifications, not personal connections.
3. Rules and Written Records: The organization relies on standardized rules and
documentation for consistency and continuity.
 4. Uniform Application: Rules and procedures are applied equally to all employees.
5. Division of Labor: There is a clear division of labor with specific authority and
responsibility for each role.
6. Hierarchy: Positions are organized in a hierarchical structure, with each position under
the authority of a higher one.

2.4. Implications:

● Bureaucracy is designed to ensure continuity through formal structures rather than

relying on individual personalities.
● Although bureaucracy can be associated with negative aspects like excessive rules and
inefficiency, it also provides standardized procedures that ensure fairness and efficiency.

3. Administrative Principles: A subfield of the classical management perspective that focuses

on the total organization rather than the individual worker, delineating the management functions
of planning, organizing, commanding, coordinating, and controlling.

3.1. Henri Fayol (1841–1925):

● Fayol was a French mining engineer who rose to become the head of Comambault, a
major mining group. His work in management led him to develop several foundational
concepts in administrative theory.
● His key work, General and Industrial Management, outlined principles and functions of
management based on his experiences.

3.2. 14 Principles of Fayol:

1. Division of Work: Henri believed that segregating work in the workforce amongst the
workers will enhance the quality of the product. Similarly, he also concluded that the
division of work improves the productivity, efficiency, accuracy and speed of the
workers. This principle is appropriate for both the managerial as well as a technical work
level.
2. Authority and Responsibility: These are the two key aspects of management. Authority
facilitates the management to work efficiently, and responsibility makes them responsible
for the work done under their guidance or leadership.
3. Discipline: Without discipline, nothing can be accomplished. It is the core value for any
project or any management. Good performance and sensible interrelation make the
management job easy and comprehensive. Employees’ good behaviour also helps them
smoothly build and progress in their professional careers.
4. Unity of Command: This means an employee should have only one boss and follow his
command. If an employee has to follow more than one boss, there begins a conflict of
interest and can create confusion.
5. Unity of Direction: Whoever is engaged in the same activity should have a unified goal.
This means all the people working in a company should have one goal and motive which
will make the work easier and achieve the set goal easily.
6. Subordination of Individual Interest: This indicates a company should work unitedly
towards the interest of a company rather than personal interest. Be subordinate to the
purposes of an organisation. This refers to the whole chain of command in a company.
7. Remuneration: This plays an important role in motivating the workers of a company.
Remuneration can be monetary or non-monetary. Ideally, it should be according to an
individual’s efforts they have put forth.
8. Centralization: In any company, the management or any authority responsible for the
decision-making process should be neutral. However, this depends on the size of an
organisation. Henri Fayol stressed on the point that there should be a balance between the
hierarchy and division of power.
9. Scalar Chain: Fayol, on this principle, highlights that the hierarchy steps should be from
the top to the lowest. This is necessary so that every employee knows their immediate
senior also they should be able to contact any, if needed.
10. Order: A company should maintain a well-defined work order to have a favourable work
culture. The positive atmosphere in the workplace will boost more positive productivity.
11. Equity: All employees should be treated equally and respectfully. It’s the responsibility
of a manager that no employees face discrimination.
12. Stability: An employee delivers the best if they feel secure in their job. It is the duty of
the management to offer job security to their employees.
13. Initiative: The management should support and encourage the employees to take
initiatives in an organisation. It will help them to increase their motivation and morale.
14. Esprit de Corps: It is the responsibility of the management to motivate their employees
and be supportive of each other regularly. Developing trust and mutual understanding
will lead to a positive outcome and work environment.
Session 6: Humanistic perspective (human relations, behavioural science approach)
Humanistic Perspective
A management perspective that emerged near the late nineteenth century and emphasized
understanding human behavior, needs, and attitudes in the workplace. We will discuss three
subfields based on the humanistic perspective: the human relations movement, the human
resources perspective, and the behavioral sciences approach.
1. Human relations movement: This movement was based on the idea that effective control
within an organization comes from within the individual worker, rather than through strict,
authoritarian control. It recognized the importance of treating employees well and responded to
social pressures for enlightened treatment of workers.
Hawthorne Studies: These studies were a series of experiments conducted at the Hawthorne
plant of the Western Electric Company. Initially focused on the effects of lighting on
productivity, the studies revealed that factors other than physical conditions, such as human
relations and social factors, had a significant impact on productivity.
Controversy and Reanalysis: The findings of the Hawthorne studies were controversial, with
some scholars later suggesting that money played a significant role in the increased productivity,
contrary to the original conclusion that human relations were the primary factor.
Impact on Management Theory: Despite methodological flaws, the Hawthorne studies played
a crucial role in shifting management theory towards a more human-centered approach. This laid
the foundation for the Human Relations Movement, which has had a lasting influence on
management practices, emphasizing the importance of treating employees as individuals with
social and emotional needs.
2. Human resources perspective: This perspective emerged as a more advanced approach
compared to the earlier Human Relations Movement. While the Human Relations Movement
initially suggested that satisfied workers would naturally be more productive (akin to the
"contented cows give more milk" analogy), the Human Resources Perspective delved deeper into
understanding and optimizing worker potential.
● Job Design and Motivation: The Human Resources Perspective emphasizes designing
jobs in a way that allows employees to use their full potential, rather than seeing tasks as
dehumanizing or demeaning. This approach integrates job design with theories of
motivation, aiming to create work environments where employees feel valued and
motivated.
Abraham Maslow’s Hierarchy of Needs: Abraham Maslow was a prominent psychologist who
introduced the Hierarchy of Needs in his 1943 paper "A Theory of Human Motivation." This
theory is fundamental to understanding human motivation and has significantly impacted
management practices.

Hierarchy of Needs:
● Physiological Needs: These are the most basic human needs, including food, water,
shelter, and sleep. In the workplace, this translates to the need for a living wage that
allows employees to meet these basic survival needs.
● Safety Needs: Once physiological needs are met, the next level involves safety and
security. This includes physical safety, job security, and a safe working environment.
Employees need to feel secure in their jobs and free from threats.
● Belongingness and Love Needs: Humans have an inherent need for social interaction,
love, and a sense of belonging. In the workplace, this translates to a positive work
culture, teamwork, and good relationships with colleagues and supervisors.
● Esteem Needs: After social needs are fulfilled, people seek esteem. This includes
self-esteem (confidence, achievement) and esteem from others (recognition, respect). In
the workplace, this could involve promotions, awards, and other forms of recognition.
● Self-Actualization Needs: The highest level in Maslow's hierarchy is self-actualization,
where individuals seek personal growth, fulfillment, and realizing their full potential. In a
job, this might mean opportunities for creativity, problem-solving, and professional
development.
Douglas McGregor’s Theory X and Theory Y: Douglas McGregor was a management professor
who introduced Theory X and Theory Y in his 1960 book "The Human Side of Enterprise."
These theories describe two contrasting views of workers and management styles.
Theory X:
● Assumptions:
o Workers inherently dislike work and will avoid it if they can.
o Because of this dislike, workers need to be closely supervised and controlled.
o Workers prefer to be directed and avoid responsibility, seeking security above all
else.
Management Style: Authoritarian: Managers who follow Theory X tend to use a controlling,
coercive, and directive approach. They believe that without strict supervision, workers will
underperform. This can lead to a work environment where employees are micromanaged and
lack autonomy.
Theory Y:
● Assumptions:
o Work is as natural as play or rest, and people will direct themselves if they are
committed to the objectives.
o Employees will exercise self-control and self-direction if they are committed to
the goals.
o Under proper conditions, workers not only accept but also seek responsibility.
o Creativity and ingenuity are widely distributed among the population, and the
intellectual potential of the average worker is only partially utilized in most
organizations.
Management Style: Participative: Managers who subscribe to Theory Y are more likely to
adopt a participative approach, empowering employees by involving them in decision-making
processes. They believe that when employees are given the right conditions, they will be
motivated, responsible, and creative.
3. Behavioral Sciences Approach: A subfield of the humanistic management perspective that
applies social science in an organizational context, drawing from economics, psychology,
sociology, and other disciplines.
● The Behavioral Sciences Approach is rooted in scientific methods and draws from
multiple disciplines including sociology (study of social behavior and society),
psychology (study of mind and behavior), anthropology (study of human societies and
cultures), and economics (study of production, distribution, and consumption of goods
and services).
● This interdisciplinary foundation allows for a comprehensive understanding of human
behavior in an organizational context, leading to the development of theories and
practices that can enhance organizational effectiveness.
Organization Development (OD):
● Evolution and Purpose: Organization Development (OD) emerged in the 1970s as a
distinct field within the Behavioral Sciences Approach. It focuses on improving the
health and effectiveness of organizations by enhancing their ability to cope with change,
improving internal relationships, and boosting problem-solving capabilities.
● Techniques and Concepts: OD techniques have evolved to address the increasing
complexity of modern organizations. These techniques are vital for managers as they
navigate the challenges of a dynamic business environment.
● Contemporary Relevance: Although OD originated several decades ago, it remains a
crucial approach for managing organizational change and development today. It involves
activities such as team building, leadership development, and change management.
Influence on Management Practices:
● Matrix Organizations: The concept of matrix organizations, where employees report to
multiple managers (often across different functional areas), is rooted in behavioral
sciences. This structure is designed to enhance flexibility and collaboration in complex
organizational environments.
● Self-Managed Teams: Self-managed teams, where employees are given the autonomy to
manage their tasks and make decisions, reflect the application of behavioral science
principles that emphasize empowerment and collaboration.
● Corporate Culture: The study of corporate culture, or the shared values, beliefs, and
norms within an organization, also stems from the Behavioral Sciences Approach.
Understanding and shaping corporate culture is crucial for achieving organizational goals.
● Management by Wandering Around (MBWA): This management technique involves
managers informally walking around the workplace to engage with employees, gather
insights, and address issues in real-time. It’s based on the idea that close, informal
interaction can lead to better communication and problem-solving.