Place Slide Title Text Here JOHN R SCHERMERHORN

Place Slide Title Text Here JOHN R. SCHERMERHORN, JR. MANAGEMENT 12 th Edition Chapter 2 History of Management Thought © 2013 John Wiley & Sons, Inc. All rights reserved. 2 -1 1 -1

Place Slide Title Text Here 2 Study Questions Planning Ahead — Chapter 1. What can be learned from classical management thinking? 2. What insights come from behavioral management approaches? 3. What are the foundations of modern management thinking? © 2013 John Wiley & Sons, Inc. All rights reserved. 2 -2

Place Slide Title Text Here Dashboard Chapter 2 Learning 1. Classical Management Approaches 1. 2. 3. Scientific management Administrative principles Bureaucratic organization 2. Behavioral Management Approaches 1. 2. 3. 4. 5. Follett’s organizations as communities The Hawthorne studies Maslow’s theory of human needs Mc. Gregor’s Theory X and Theory Y Argyris’s theory of adult personality © 2013 John Wiley & Sons, Inc. All rights reserved. 2 -3

Place Slide Title Text Here Dashboard Chapter 2 Learning 3. Modern Management Foundations 1. 2. 3. 4. 5. 6. Quantitative analysis and tools Organization as systems Contingency thinking Quality management Knowledge management and organizational learning Evidence-based management © 2013 John Wiley & Sons, Inc. All rights reserved. 2 -4

Place Slide Title Text Here Figure 2. 1 Major branches in the classical approach to management © 2013 John Wiley & Sons, Inc. All rights reserved. 2 -5

1: Classical Management Approaches Place. Takeaway Slide Title Text Here • Four guiding principles of scientific management (Frederick Taylor) 1. Develop for every job a “science” that includes rules of motion, standardized work implements, and proper working conditions. 2. Carefully select workers with the right abilities for the job. 3. Carefully train workers to do the job and give them the proper incentives to cooperate with the job “science. ” 4. Support workers by carefully planning their work and by smoothing the way as they go about their jobs. © 2013 John Wiley & Sons, Inc. All rights reserved. 6 2 -6

1: Classical Management Approaches Place. Takeaway Slide Title Text Here • Scientific management (the Gilbreths) – Motion study • Science of reducing a job or task to its basic physical motions – Eliminating wasted motions improves performance © 2013 John Wiley & Sons, Inc. All rights reserved. 2 -7

1: Classical Management Approaches Place. Takeaway Slide Title Text Here • Practical lessons from scientific management – Make results-based compensation a performance incentive – Carefully design jobs with efficient work methods – Carefully select workers with the abilities to do these jobs – Train workers to perform jobs to the best of their abilities – Train supervisors to support workers so they can perform jobs to the best of their abilities © 2013 John Wiley & Sons, Inc. All rights reserved. 2 -8

1: Classical Management Approaches Place. Takeaway Slide Title Text Here • Administrative principles (Henri Fayol) — rules/duties of management: Foresight to complete a plan of action for the future Organization to provide and mobilize resources to implement the plan Command Coordination Control to lead, select, and evaluate workers to get the best work toward the plan to fit diverse efforts together and ensure information is shared and problems solved to make sure things happen according to plan and to take necessary corrective action © 2013 John Wiley & Sons, Inc. All rights reserved. 2 -9

1: Classical Management Approaches Place. Takeaway Slide Title Text Here • Administrative principles (Henri Fayol) – Scalar chain • there should be a clear and unbroken line of communication from the top to the bottom of the organization – Unity of command • each person should receive orders from only one boss – Unity of direction • one person should be in charge of all activities with the same performance objective © 2013 John Wiley & Sons, Inc. All rights reserved. 2 -10

1: Classical Management Approaches Place. Takeaway Slide Title Text Here • Bureaucratic organization (Max Weber) – Bureaucracy • An ideal, intentionally rational, and very efficient form of organization • Based on principles of logic, order, and legitimate authority © 2013 John Wiley & Sons, Inc. All rights reserved. 2 -11

1: Classical Management Approaches Place. Takeaway Slide Title Text Here • Characteristics of bureaucratic organizations: – Clear division of labor – Clear hierarchy of authority – Formal rules and procedures – Impersonality – Careers based on merit © 2013 John Wiley & Sons, Inc. All rights reserved. 12 2 -12

1: Classical Management Approaches Place. Takeaway Slide Title Text Here • Possible disadvantages of bureaucracy: – Excessive paperwork or “red tape” – Slowness in handling problems – Rigidity in the face of shifting needs – Resistance to change – Employee apathy © 2013 John Wiley & Sons, Inc. All rights reserved. 2 -13

Place Slide Title Text Here Figure 2. 2 Foundations in the behavioral or human resource approaches to management Hawthorne studies Elton Mayo Theory of human needs Abraham Maslow Organizations as communities Mary Parker Follett Theory X and Theory Y Douglas Mc. Gregor Human resource approaches Assumption: People are social and selfactualizing © 2013 John Wiley & Sons, Inc. All rights reserved. Personality and organization Chris Argyris 2 -14

Takeaway 2: Behavioral Management Approaches Place Slide Title Text Here • Organizations as communities – Mary Parker Follett – Groups and human cooperation: • Groups allow individuals to combine their talents for a greater good • Organizations are cooperating “communities” of managers and workers • Manager’s job is to help people cooperate and achieve an integration of interests © 2013 John Wiley & Sons, Inc. All rights reserved. 2 -15

Takeaway 2: Behavioral Management Approaches Place Slide Title Text Here • Organizations as communities – Forward-looking management insights: Making every employee an owner creates a sense of collective responsibility • precursor of employee ownership, profit sharing, and gain-sharing Business problems involve a variety of inter-related factors • precursor of systems thinking Private profits relative to public good • precursor of managerial ethics and social responsibility © 2013 John Wiley & Sons, Inc. All rights reserved. 2 -16

Takeaway 2: Behavioral Management Approaches Place Slide Title Text Here • Hawthorne studies – Initial study examined how economic incentives and physical conditions affected worker output – No consistent relationship found – “Psychological factors” influenced results © 2013 John Wiley & Sons, Inc. All rights reserved. 2 -17

Takeaway 2: Behavioral Management Approaches Place Slide Title Text Here • Hawthorne studies (cont. ) – Social setting and human relations • Manipulated physical work conditions to assess impact on output • Designed to minimize the “psychological factors” of previous experiment • Mayo and colleagues concluded: – New “social setting” led workers to do good job – Good “human relations” = higher productivity © 2013 John Wiley & Sons, Inc. All rights reserved. 2 -18

Takeaway 2: Behavioral Management Approaches Place Slide Title Text Here • Hawthorne studies (cont. ) – Employee attitudes and group processes • Some things satisfied some workers but not others • People restricted output to adhere to group norms © 2013 John Wiley & Sons, Inc. All rights reserved. 2 -19

Takeaway 2: Behavioral Management Approaches Place Slide Title Text Here • Lessons from the Hawthorne Studies: – Social and human concerns are keys to productivity – Hawthorne effect — people who are singled out for special attention perform as expected © 2013 John Wiley & Sons, Inc. All rights reserved. 2 -20

Takeaway 2: Behavioral Management Approaches Place Slide Title Text Here • Maslow’s theory of human needs – A need is a physiological or psychological deficiency a person feels compelled to satisfy – Need levels: • • • Physiological Safety Social Esteem Self-actualization © 2013 John Wiley & Sons, Inc. All rights reserved. 2 -21

Place Slide Title Text Here Figure 2. 3 Maslow’s hierarchy of human needs © 2013 John Wiley & Sons, Inc. All rights reserved. 2 -22

Takeaway Behavioral Management Approaches Place Slide 2: Title Text Here • Maslow’s theory of human needs – Deficit principle • A satisfied need is not a motivator of behavior – Progression principle • A need becomes a motivator once the preceding lower -level need is satisfied – Both principles cease to operate at selfactualization level © 2013 John Wiley & Sons, Inc. All rights reserved. 2 -23

Takeaway 2: Behavioral Management Approaches Place Slide Title Text Here • Mc. Gregor’s Theory X assumes that workers: – Dislike work – Lack ambition – Are irresponsible – Resist change – Prefer to be led © 2013 John Wiley & Sons, Inc. All rights reserved. 2 -24

Takeaway 2: Behavioral Management Approaches Place Slide Title Text Here • Mc. Gregor’s Theory Y assumes that workers are: – Willing to work – Capable of self control – Willing to accept responsibility – Imaginative and creative – Capable of self-direction © 2013 John Wiley & Sons, Inc. All rights reserved. 2 -25

Takeaway 2: Behavioral Management Approaches Place Slide Title Text Here • Implications of Theory X and Theory Y: – Managers create self-fulfilling prophecies – Theory X managers create situations where workers become dependent and reluctant – Theory Y managers create situations where workers respond with initiative and high performance • Central to notions of empowerment and selfmanagement © 2013 John Wiley & Sons, Inc. All rights reserved. 2 -26

Takeaway 2: Behavioral Management Approaches Place Slide Title Text Here • Argyris’s theory of adult personality – Classical management principles and practices inhibit worker maturation and are inconsistent with the mature adult personality – Psychological success occurs when people define own goals © 2013 John Wiley & Sons, Inc. All rights reserved. 2 -27

Takeaway 2: Behavioral Management Approaches Place Slide Title Text Here • Argyris’s theory of adult personality – Management practices should accommodate the mature personality by: • Increasing task responsibility • Increasing task variety • Using participative decision making © 2013 John Wiley & Sons, Inc. All rights reserved. 2 -28

3: Modern Management Foundations Place. Takeaway Slide Title Text Here • Foundations for continuing developments in management Quantitative analysis and tools Systems view of organizations Contingency thinking Commitment to quality and performance Knowledge management and learning organizations Evidence-based management © 2013 John Wiley & Sons, Inc. All rights reserved. 2 -29

3: Modern Management Foundations Place. Takeaway Slide Title Text Here • Management science or operations research Inventory management Quality control Queuing theory Supply chain management Value chain analysis Linear programming The scientific applications of mathematical techniques to management problems © 2013 John Wiley & Sons, Inc. All rights reserved. Network models 2 -30

3: Modern Management Foundations Place. Takeaway Slide Title Text Here • Quantitative Analysis and Tools • Analytics – the use of large data bases and mathematics to solve problems and make informed decisions using systematic analysis • Typical quantitative approach to managerial problemsolving – Problem encountered, it is systematically analyzed, appropriate mathematical models and computations applied, optimal solution identified © 2013 John Wiley & Sons, Inc. All rights reserved. 2 -31

3: Modern Management Foundations Place. Takeaway Slide Title Text Here • Organizations as Systems – System • Collection of interrelated parts that function together to achieve a common purpose – Subsystem • A smaller component of a larger system – Open systems • Organizations that interact with their environments in the continual process of transforming resource inputs into outputs © 2013 John Wiley & Sons, Inc. All rights reserved. 2 -32

Place Slide Title Text Here Figure 2. 4 Organizations as complex networks of interacting subsystems © 2013 John Wiley & Sons, Inc. All rights reserved. 2 -33

3: Modern Management Foundations Place. Takeaway Slide Title Text Here • Contingency thinking – Tries to match managerial responses with problems and opportunities unique to different situations – No “one best way” to manage – Appropriate way to manage depends on the situation © 2013 John Wiley & Sons, Inc. All rights reserved. 2 -34

3: Modern Management Foundations Place. Takeaway Slide Title Text Here • Quality management – Managers and workers in progressive organizations are quality conscious • Quality and competitive advantage are linked – Total quality management (TQM) • Comprehensive approach to continuous quality improvement for a total organization • Creates context for the value chain © 2013 John Wiley & Sons, Inc. All rights reserved. 2 -35

3: Modern Management Foundations Place. Takeaway Slide Title Text Here – Continuous improvement • Continual search for new ways to improve quality • Something always can and should be improved – ISO certification • Global quality benchmark • Refine and upgrade quality to meet ISO standards © 2013 John Wiley & Sons, Inc. All rights reserved. 2 -36

3: Modern Management Foundations Place. Takeaway Slide Title Text Here • Knowledge Management and Organizational Learning – Knowledge management is the process of using intellectual capital for competitive advantage – Portfolio of intellectual assets include patents, intellectual property rights, trade secrets, and accumulated knowledge of the entire workforce © 2013 John Wiley & Sons, Inc. All rights reserved. 2 -37

3: Modern Management Foundations Place. Takeaway Slide Title Text Here • Learning organizations – Organizations that are able to continually learn and adapt to new circumstances – Core ingredients include: Encourage learning Information sharing Teamwork Empowerment © 2013 John Wiley & Sons, Inc. All rights reserved. Participation 2 -38

3: Modern Management Foundations Place. Takeaway Slide Title Text Here • Evidence-Based Management – Making management decisions on “hard facts” about what really works © 2013 John Wiley & Sons, Inc. All rights reserved. 2 -39

3: Modern Management Foundations Place. Takeaway Slide Title Text Here • Evidence-Based Positive Human Resource Management Practices – Employment security – Selective hiring – Self-managing teams – High pay based on merit – Training and development – Reduced status distinctions – Shared information © 2013 John Wiley & Sons, Inc. All rights reserved. 2 -40