Management and Practices

2.2        Early perspectives of management

The first known management ideas were recorded as long as 3000-4000 B.C. One example is the building of the pyramids in Egypt. Archeologists and historians have discovered that the Sumerians in 3000 B.C. used form of recordkeeping for commerce that was a relatively sophisticated system of accounting. Throughout the history, management style was often autocratic and paternalistic. Servants, soldiers or workers who were “supervised” were all expected to do as they were told. The autocratic owner or manager was generous, as long as people stayed in line. 

Many of the greatest contribution to management thought and practice occurred during and after the late 1800s. The industrial revolution in the United States led to a need for greater efficiency in production, and thus the development was due to the changing nature of social values, growth in the population, the use of more technology and machines, and the demand for more complex products by consumers. These changes evoked the development of the classical era of management thought.  

2.3        Classical management theory

Classical theory is a grouping of similar ideas on the management of organisation that evolved in the late 1800s and early 1900s. This theory contains three general branches. The most important characteristic of all three is an emphasis on the economic rationality of the individual employee at work.

The rational economic assumption was an extension of the ideas developed by Adam Smith. Smith´s classical assumption was that people choose the course of action that maximises their economic reward. To get employees to work hard, managers should appeal to their monetary desires. The assumptions are generally based on pessimistic views of human nature. Although these views are true to some extent, they oversee more positive aspects. These theorists recognised that humans have emotions, but they felt that emotions could be controlled by a logical and rational structuring of jobs and work.

The focus on individual jobs was predominant with scientific. The series of ideas that became known as scientific management grew from the work of Frederick W. Taylor, who is known as “the founder of scientific management”. Scientific management emphasizes that managers and industrial engineers should develop the best way to perform each job, people should be trained to perform each job in the best way, and management and workers should co-operate so that the job is performed in the desired manner. Scientific management has made important contributions to the general field of management. First, it emphasised the need for specialised labour, secondly, it fostered the beginnings of job design.

The theorist most often associated with the bureaucratic approach is Max Weber. Weber´s ideas of bureaucracy were a reaction to managerial abuses of power. He looked for methods to eliminate managerial inconsistencies that contributed in ineffectiveness, and his solution was a set of principles for organising group effort through a bureaucratic organisation. These principles are virtually every formal organisation, today. 

1. Criticism to classical theory

One problem in applying the ideas of classical theory in highly developed countries is that such theory is based on the notions of the rational economic person. The assumption that most people are motivated primarily by economic rewards might have been appropriate around 1900. However, with the increase of educational level and changes in people´s aspirations, this assumption is true for fewer people today. Also, organisations have grown more complex, and as a result, managers must now rely on more employee creativity and judgement in many jobs. Another problem with the classical approach is that it assumes that all organisations can be managed according to on set principle. This assumption is not valid for the modern world.

3. The human relations approach

Neoclassical theory is a group of management ideas that developed from the 1920´s through  the 1950´s. The predominant characteristic of these ideas is the emphasis on the social, needs, drives and attitudes of individuals. The neoclassical theorists felt that employees could not simply respond rationally to rules, authority and economic incentives. They believed that employees brought their social needs with them to the organisation and that effective management required a more-human oriented approach.

2. Criticism of the human relations approach

Management approaches developed from the neoclassical theory were based on a more realistic picture of people at work. The importance of group behaviour could no longer be ignored. Managers began putting greater emphasis on the work group and theneed for better communication between supervisors and workers. There is a difference between allowing workers to participate in making work-related decisions and letting workers think that they are participating in the company through social and recreational activities. Neoclassical theory provided useful insights but was not totally accurate.

3.         Managerial roles, functions and skills

To meet the many demands of performing their function, managers obtain multiple roles. A role is an organised set of behaviours. Mintzberg has identified ten roles common to the work of managers. The ten roles are divided into three groups; interpersonal, informational and decisional. The informational role links the managerial work together. The interpersonal roles ensure that information is provided. The performance of managerial roles and requirements of these roles can be played at different times by the same manager and to different degrees depending on the function of management.

Managers create and maintain an internal environment, so that others can work efficiently. The manager´s job consists of planning, organising, directing and controlling the resources of the organisation. These resources are people, jobs, technology, facilities, materials, information and money. Managers act in a dynamic environment and must adapt to changes. The job of every manager involves what is known as the functional management: planning, organising, directing and controlling functions are goal-directed and interdependent. Businesses are highly interdependent on each other, their suppliers and their customers. Decisions are not taken in isolation. The effects of any decision will depend critically on the reactions of other groups in the market. These have to be, as far as possible, taken into account before decisions are made.

Organising involves arranging the necessary resources to carry out the process of creating structure, establishing relationships to accomplish the goals of the organisation. Directing involves the guiding and leading employees to achieve the goals. Controlling involves verifying that the actual performance matches the plan.  

In order to perform the functions of management, managers must be skilled. Robert Katz identified thee main skills that are essential to successful management: technical, human and conceptual. Technical skill involves the process or technique known as proficiency. Human skill involves the ability to interact effectively their environment and cooperate with employees. Conceptual skill involves the formulation of ideas. Managers understand the abstract relationships, have ideas, and solve problems creatively. A manager´s level in the organisation determines the relative application of the technical, human and conceptual skills. Top level management apply conceptual skills in order to view the organisation as a whole. Supervisors on the other hand need technical skills to manage their area of specialty.

3.1         Business environment

A manager is someone skilled in knowing how to analyse and improve the performance of an organisation to survive and grow in a complex and changing world. A management system describes the organisation and the set of significant decisions in the complex and rapidly changing environment that affect its ability to serve its customers. The firm must continuously monitor and adapt to the environment if it is to survive and prosper. Disturbances in the environment may mean profound threats or new opportunities for the firm.

The management level can be subdivided on two levels. The first level is the organisations internal environment. Internally, an organisation can be visualised as a resource conversion machine that takes input (labour, money, materials and equipment) from external environment, converts them into useful products, goods, and services, and makes them available to customers.

The second level of the management system involves the organisations external environment. It consists of all the outside institutions and forces that have a potential interest or impact in the ability to achieve its objectives within competitive, economic, technological, political, legal, demographic, cultural ecosystem.

Environmental forces create challenges and opportunities for the organisation. Managers must react and adapt to changes in their internal and external environment. Globalisation is an example of an opportunity for an organisation. Globalisation affects how organisations are managed. Managers must learn to deal with multiple cultures and systems in rapidly changing markets and technology.

2. The importance of a management team

The person who conceived the original idea is not always blessed with the skills required to run a start up. There are a lot of examples of entrepreneurs who ultimately led their companies to bankruptcy, because they lacked the ability to lead a large organisation in the global market. Many management theories describe various characteristics that are suitable for running companies throughout their life cycles.

An experienced CEO is not always essential in order to succeed. Sometimes, one of the entrepreneurs can manage the company in its early years, but if the company grows beyond his managerial abilities, he/she must acknowledge this. The ability of one of the entrepreneurs to tackle the managerial position at the beginning are therefore highly important.

If the company is technological, the founding team has to have at least one person with an understanding of the technology required in order to execute the idea. The presence of a technological leader on the team increases the chances that even if the original idea does not work, it will at least generate new and valuable technology. The importance of a technological leader is usually crucial and often takes the place of convincing potential employees to join the company.

From a historical perspective, most successful companies started by analysing markets and engaging in business and marketing development already in the companies early stages. Engaging a person with marketing experience can create marketing channels concurrently with the development.  

Summarised it is important to understand that management is not only the co-relation between manager and subordinate but also the co-relation on a horizontal level.

3. Modern management

The ideas of classical and neoclassical theorists have many applications in the management of todays´ organisations. However, modern management theory highlights the complexity of modern organisations and integrates ideas from the other management theories. Since individuals are complex and people´s motives, needs, aspirations, potentials vary, there can be just a few static principles.  

 Because of the complexity of organisations today, no single managerial strategy is correct for all situations. The approach that describes the application of this view-point in managerial practice is the contingency theory. It depends on knowledge of and research into organisations as systems, and stresses the need for managerial strategies based on all relevant facts. It focuses on acions that fit best the situation. It emphasises the development of management skills that are most useful in identifying important factors.

Theorists believe that behaviour results from individual reactions to important aspects of his environment. They do not believe that individuals simply respond to their basic instincts or needs but rather are motivated. 

It also suggests that managers must be flexible leaders. It is not enough for them always to be kind and considerate to subordinates, they must do so at the right time. At other times managers may have to be more authoritative and exert more control over them. This approach discusses the aspects of the leadership situation that influence how a leader should behave.  

4.        Conclusion

The major contribution of these new approaches is the emphasis on decision-making analysis as opposed to blind application of universal principles. These approaches recognise certain important factors that necessitate different applications of managerial procedures and styles. They also encourage managers to respond quickly to changes that occur in the environment, such as new technology and different societal values.

However, these concepts are more difficult for new managers to understand. It is very easy to learn sets of universal management principles without regard to he possibility that they may be wrong for some situations. It is much more difficult to understand systems.

Modern management uses each concepts described, as well as relevant concepts from classical and neoclassical theory, to develop effective management.

Branches of management theory also exist relating to  and to government: such as , , and educational management. Further, management programs related to  organizations have also implemented programs in nonprofit management and .

As one consequence,  has become both more common, and more advocated, in some places distributing all management functions among the workers, each of whom takes on a portion of the work. However, these models predate any current political issue, and may occur more naturally than does a . All management to some degree embraces democratic principles in that in the long term workers must give majority support to management; otherwise they leave to find other work, or go on strike. Management has started to become less based on the conceptualisation of classical military command-and-control, and more support of collaborative activity, utilizing principles such as those of  to deal with the complexities of human interaction. 

Finally, it is important to realise that there is no single best theory of management. Each of the many theories of management has some advantageous applications and some limitations. Management today is both a reflection of and a reaction to past management theories. The most important theories have been presented in this paper.

References

Antony Jay, Management and Machiavelli: An Inquiry into the Politics of Corporate Life (New York: Bantam, 1968)

C. I. Barnard, The Functions of the Executive (Cambridge, Mass.: Harvard University Press, 1938)

Claude S. George, The History of Management Thought (Englewood Cliffs, N.J.: Prentice-Hall, 1968)

Daniel A. Wren, The Evolution of Management Thought (New York: John Wiley, 1979).

Daniel A. Wren, "Retrospective Comment on Planning-Fayol," in L. E. Boone and D. D. Bower, The Great Writings in Management and Behavior (New York: Random House, 1987)

Edgar H. Schein, Organizational Psychology (Englewood Cliffs, N.J.: Prentice-Hall, 1970)

F. B. Gilbreth, Motion Study (New York: Van Nostrand Reinhold, 1911).

F. J. Roethlisberger and William J. Dickson, Management and the Worker (New York: John Wiley, 1939).

F. W. Taylor, Principles of Scientific Management (New York: Harper & Row, 1911)

James A. Robinson, "Leadership and Machiavelli," National Forum (Fall 1983)

Internet

www.wikipedia.com

www.businessweek.com

www.harvardbusinessschool.com

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