The MBO strategy is also limited in terms of the objectives it can measure. For example, if the company wishes to improve customer service it could set the objective that all calls must be answered within a certain amount of time. Yet it’s very difficult to measure the quality of service in terms of the politeness of the member of staff taking the call, without a subjective judgement being made by a supervisor. This shows that the value of MBO is limited without successful policies to underpin it, and that the scheme cannot be used to quantify successes in all situations.
Scientific management and the classical approach
Management strategies which may be used to achieve targets (such as those set for an MBO organisation) vary in terms of their scientific nature. The most scientific approach to management study is the classical approach, which places emphasis on measurable targets and the business’ formal structure. The classical approach encompasses scientific management, and the supporting research carried out by F. W. Taylor in 1890 through to the early 1900s. Taylor studied the jobs of individual workers in a steel works, and then broke the job functions down into component tasks. He reasoned that there is one best way to complete each task in order to maximise productivity. He was also able to rearrange the order in which tasks were done with the aim of eliminating wasteful movements.
Taylor’s work was scientific because he was able to carefully monitor changes to work patterns, and compare these with quantitative productivity gains (for example, Taylor was able to increase the amount of steel loaded by one worker, Schmidt, to 47.5 tons per day, almost four times the average level of productivity within the Bethlehem Steel Corporation) (Mullins, 1999:55). This scientific process allowed the gains in productivity to be clearly linked to the changes in work processes in this example.
However, Taylor failed to take into account the effect of this process on the workers. Many criticisms of Taylor’s motion study suggested the resulting work processes were boring and required little skill. This reduces worker morale and motivation. When Taylor’s procedures were adopted in the Watertown Arsenal plant; a strike ensued, so it cannot be argued that scientific management is best for organisational functionality in all organisations (Allen, Braham, Lewis, 2000:340-342).
According to Taylor, ‘Any man phlegmatic enough to do manual work is too stupid to develop the best way, the scientific way of doing a job’(Littler, 1978:185-202). He reasoned that this principle suggests workers should do what they’re told, and not offer suggestions for improvements. More recent theories have questioned this conclusion, for example research by Winfield et al. (1973) proved that if a worker perceives that they have a low level of control, stress levels would generally be higher (Thompson & McHugh, 2002). Again Taylor’s principles could adversely affect the firm; costs of stress related absenteeism can be high.
Taylor’s early work contributed to the development of bureaucracies. This type of organisation also falls under the classical scientific approach. Defining characteristics of a bureaucracy (identified by Weber) include a clear-cut division of labour, standardised procedures, and a hierarchy of authority (Mullins, 1999:60). One of the aims of a bureaucracy is to keep the organisation consistent and impersonal in order to make rational business judgments. This is a very scientific and measured way of making decisions.
It could be argued that consequently the study of such business structures is relatively scientific. However, theories such as Weber’s ignore the impact of the informal organisation upon workers. The informal organisation exists in all companies and comprises of all management related factors which cannot be directly controlled by the company’s management such as conflict, or power and organisational politics. Research investigating power structures within an organisation would need to consider personal power which subordinates may possess (such as the ability to influence supervisors using charisma), in addition to the formal chain of command. As such sources of power are not codified and might not be identified by research; the informal organisation introduces an area of uncertainty into management study. This could potentially lead to incorrect conclusions being drawn about the causes of problems within an organisation.
The human relations approach: Research into the impact of human factors in organisations
This highlights a common fundamental problem which exists for all of the aforementioned scientific management strategies; they fail to take into account human factors. However, in the long run, human factors such as employee turnover and motivation have a significant impact on the profitability of firms. “Many operational problems in organisations relate to the nature of human behaviour…and do not lend themselves to the application of a scientific answer” (Mullins, 1999:76).
It is therefore often difficult to establish causal relationships between individual aspects of management strategy and human behaviour. Successful management relies on intuition, intelligence, personality and experience, yet these attributes are difficult to pass on to other individuals, and they are often difficult to measure objectively. This clouds the issue of what makes a successful manager, we cannot stipulate that a certain personality type or level of intelligence is necessary to be successful; managers may posses a combination of traits, paired with skills and techniques which can be measured more objectively. This concept that managers come as a ‘package’ (i.e. their many characteristics are inseparable) further prevents scientific causal analysis of successful management styles.
The people skills of managers can be difficult to measure scientifically, yet they are important in determining managers’ success within organisations. For example Likert (1961) was able to show that first-line supervisors who had limited contact with subordinates, yet gave frequent detailed work instructions (hence limiting their freedom) had a low productivity record. Supervisors who demonstrated more trust for their workforce, allowed more lower-level decision making, and maintained good relationships with subordinates had much higher productivity levels (McKenna, 1994:365-6).
It is difficult to deduce the extent to which the greater success is due to the different management styles employed (autocratic vs. participative); or due to the superior people skills of the second group of supervisors. This prevents researchers from scientifically concluding that a participative management style is better.
Many case studies have investigated the effects of management strategies on employee turnover. A study into the Ford motor company in 1985 revealed that by making jobs more interesting and varied, and by giving workers more authority, employee turnover could be reduced. Other studies have shown that by aligning business objectives (i.e. making a profit) with worker objectives via profit sharing initiatives, managers have been able to reduce employee turnover. A further case study has revealed that by listening to employee suggestions, managers have reduced employee turnover; not just through acting upon suggestions, but by showing they care about employees (Greenberg & Baron, 2000:185-6).
The outcomes in all of the above case studies were quantifiable, i.e. employee turnover was reduced in all cases. Yet if the research had been repeated in other organisations, different results may have been be obtained (i.e. the research findings aren’t reliable). For example, the way in which the strategies are implemented is a crucial factor, if the hourly wage of an employee must be cut in order to afford a profit sharing initiative, then workers are unlikely to be enthusiastic about the scheme. Likewise, if profit targets are too difficult to meet, workers may become disenchanted by the scheme.
The research is also unclear about the money saved by such strategies. For example the cost of introducing the extra training necessary for workers to enjoy greater work variety may exceed the money saved through lower turnover. Conclusions also fail to mention that worker perception is more important than the actual changes made. If feedback systems are introduced, yet workers see little improvement this is likely to provoke a cynical attitude towards the scheme. Finally, research by Staw (1985) indicates that some individuals are likely to be either consistently satisfied or dissatisfied with their jobs. A study of over 5000 men who changed jobs between 1969 and 1971 revealed that their expressions of job satisfaction remained relatively stable, despite the fact that they had different jobs. This shows that individual differences have a strong bearing on job satisfaction irrespective of environmental factors. Hence the attribution of cause and effect between management policy and job satisfaction levels is prevented. All these reasons explain why consistent scientific conclusions cannot be drawn which attribute employee turnover to management strategy.
Hawthorne Studies: (Scientific & non-scientific research into human factors at work)
One of the major pieces of research under the human relations approach was the Hawthorne research, carried out in the 1920s. The studies which made up the research varied in terms of their scientific orientation. A scientific experiment measured the effect of the intensity of lighting upon worker productivity. However the productivity of the experimental group varied with no apparent relationship to the level of lighting, whilst production also improved in the control group although the level of lighting remained unchanged. Similarly, an experiment into the effect of payment rates and rest breaks on production caused an increase in productivity with every change in the independent variable; yet there was no clear pattern which correlated the nature and significance of the reward with the increase in productivity. The researchers concluded that the increases in productivity were due to the extra interest in them shown by management or the researchers (Mullins, 1999:64-67). This highlights an important limitation of research into human behaviour; people may behave differently if they know they’re being observed.
A significant component of the Hawthorne studies was the research into the counselling service offered by the plant. Forty three members of staff were employed by Western Electric, whose job it was to seek out workers who may require somebody to talk to, and listen confidentially to any problems these workers may have. The Hawthorne studies aimed to measure the effectiveness of this controversial scheme, and asses whether the benefits of the $326,000 project outweighed the cost.
The research took the form of an observational case study, researchers simply observed the counsellors as they carried out their interviews, and spoke with workers to establish their opinions of the counsellors. In the opinions of senior management and counsellors themselves, counselling was seen as a useful form of control over the workers. Dissatisfied workers would often change their opinions of company decisions, and attempt to understand the company’s point of view over issues such as redundancies. It was argued that consequently worker motivation was improved. Thus the Hawthorne studies are also considered important for showing that “views of how managers behaved were a vital aspect of motivation and improved performance” (Crainer, 1998:111).
These findings constitute useful qualitative information. They give an insight into the perceived benefits of the counselling project, yet quantitative, numerical data would be needed to prove that an increase in productivity has occurred as a result of the project. The counselling organisation has been unable to demonstrate its efficiency in this regard (Wilensky & Wilensky, 1951:279). Consequently, although these research findings are useful in explaining potential benefits of a counselling service, a scientific cost benefit analysis cannot be carried out to determine the profitability of the project.
As previously stated, research is of limited use if it cannot be generalised to apply to other situations. As no new Hawthorne-style research has been undertaken in other organisations it is difficult to assess whether any benefit could be gained by other companies adopting a similar scheme. It is possible that such a counselling programme is only successful in combination with a range of other fringe benefits which the Hawthorne works offered their employees, including use of leisure facilities.
Another problem that prevents generalisation is the subjective nature of the counsellor’s reports, and the leeway which counsellors have when counselling workers. The reported success of counselling upon an individual is mainly monitored by the counsellor in question. This is a subjective observation; it is highly dependent on the interpretation of the counsellor and may be over-stated in order to achieve career progression.
Thus the human relations approach provides limited scientific conclusions (i.e. the proving of hypotheses), yet the qualitative data yielded by the counselling study still aids our understanding of the role of human factors in organisations. This supports the concept that the study of management techniques isn’t always scientific in nature, and that quantitative findings from scientific research are often of less use than qualitative information from case studies.
Conclusion
In conclusion, the study of management comprises of many research techniques, some of which are scientific and others not. Certain areas of study do not lend themselves to the application of scientific research techniques, and where scientific methods have been applied, results are often inconclusive. In this case, managers may find qualitative findings from research (such as the research into the Hawthorne counselling project) more relevant to the problems they face depending on whether their organisation is sufficiently similar to the organisation that was studied. It must also be acknowledged that the nature of work has been gradually changing from large numbers of manufacturing jobs to managerial, professional and service sector jobs, which do not produce tangible output (preventing scientific study of productivity). This suggests that the scientific approach to management study is, to an extent, outdated; and qualitative research on interpersonal relationships is increasingly relevant to modern management study.