The basis of Maslow's motivation theory is that human beings are motivated by unsatisfied needs, and that certain lower factors need to be satisfied before higher needs can be satisfied. According to Maslow, there are general types of needs (physiological, survival, safety, love, and esteem) that must be satisfied before a person can act unselfishly. He called these needs ‘deficiency needs’. As long as we are motivated to satisfy these cravings, we are moving towards growth, toward self-actualization. Satisfying needs is healthy, while preventing gratification makes us sick or act evilly.
Frederick Herzberg
Herzberg carried out research on accountants and engineers which highlighted the difference between job dissatisfaction and motivation in the workplace. Herzberg set an ‘open’ questionnaire with no assumptions being in the form of yes/no or multiple choice answers. As the responses were not prompted, more meaningful information was obtained
He found that job satisfaction and dissatisfaction arose because of different reasons not just opposite reactions to the same thing. Herzberg identified two types of work factors; Hygiene and Motivators, the table below shows these factors.
Herzberg proved that people strive to have the hygiene factors because life was unhappy without them, however once achieved, the satisfaction quickly evaporated. This proved that satisfaction arising from hygiene was temporary e.g. If a worker was paid £25 extra a week, the satisfaction would be shortly lived.
To What Extent is Money a Motivator?
During his research, Herzberg found out that money was not as an effective motivator as achievement and recognition. He found out that the pay rise in the example above would have to happen on an on-going basis to avoid a sense of dissatisfaction prevailing. However the pay rise was seen as an indication of a person’s achievement and seen as recognition of a job well done and that the individual was progressing.
Herzberg’s original study has produced more replications than any other study of industrial and organisational psychology and remains unchallenged over the last 52 years.
His theories apply a lot to the construction industry especially where craft persons are concerned. An example of this is when a carpenter is given the responsibility of putting a roof on a house. The carpenter will find great satisfaction through the whole process, from ordering the materials for the job to standing back and admiring his work. This allows personal achievement, individual recognition and personal advancement.
Peter F. Drucker
“Management by Objectives” (MBO) was first introduced by Drucker and identifies corporate planning and management development as its core. The company must integrate its need to clarify and achieve profit and growth goals with the managers need to contribute and develop themselves.
When introduced, it must be designed with the objective of the company in mind. MBO is implemented using the following procedure;
- The directors must outline the companies short and long term goals. Drucker stated that a company must be successful in;
- Profitability
- Productivity
- Market standing
- Innovation
- Utilisation of financial and physical resources
- Worker performance and attitude
- Management performance and development
- Public responsibility
- The organisational structure and communication network must be evaluated by the company. The organisation chart and statement of functions must be monitored frequently to ensure it is achieving its goals. Effective two way communication is needed with management sharing information as well as being able to listen to their subordinates. The management must be able to control the flow and frequency of information within the organisation to ensure effective self-control and speedier efficient decision making systems.
- The objectives of each department must be clearly defined to ascertain each departments share in the corporate plan. Each operational area must have its own level of performance. The department’s tasks must be specific, measurable and task oriented.
- The department manager must then communicate this information to the line manager e.g. a contracts manager must pass this information on to the contracts manager. This will help the contracts manager know their place within the corporate structure and in achieving the goal of completing the contract which in turn will give them interest in the job. To enhance the understanding, 4 different goals have been identified;
- Routine goals relating to the performance of routine responsibilities
- Emergency and contingency goals which are dictated by external pressures
- Innovations which demand creative skills e.g. New processes
- Personal development goals e.g. Managerial capability or dealing with other peoples attitudes
- This stage involves setting goals. Discussions will take place between managers and line managers about the goals that should be agreed to be reached by each line manager. It has been proven that if target goals and time restrictions are imposed by senior managers then the department manager will apply less energy and enthusiasm to the task.
- A plan must be developed about how these goals will be achieved. A ‘job improvement plan’ may be communicated down from the level of senior management. These are used to re-direct subordinate working practices e.g. If the company purchases a new piece of plant which requires a different method of work. The action plan should allow the sub-ordinate in this case the site manager to carry out the task whilst the project manager monitors, feeds back and gives guidance and assistance when needed.
- The managers should meet up with department managers regularly to assess the progress. This creates a more systematic relationship. Performance and potential reviews should be used with each department so the company can see if the department is meeting its goals and to see if more training is required.
- It is normal to have goals re-established and even set new management objectives. Performance and achievements will be evaluated and any initiatives can be identified. Decisions can then be made on promotions and salary increases.
Essential Components of Management by Objectives
- Teamwork
- Encouragement
- Two-way communication
In MBO goals are expected to be SMART
- Specific
- Measurable
- Achievable
- Realistic
- Time Bound
Advantages
- The objectives are discussed before being agreed
- Participation is involved in the setting of goals, deciding the action course and in making decisions
- An increase in motivation and job satisfaction
- The relationship between managers and those underneath them is improved
- Increases communication throughout the organisation
- Managers can ensure that objectives of the subordinates are linked to the organization’s objectives
- Objectives are set at all levels and in various departments
- Objectives can be set individually for each department especially in promotion, marketing, and financial planning
- It can be used in any organisation
- Employees are more self-directed rather than boss directed
Disadvantages
- It has to be systematically done
- There is more importance given to the setting of the goals than on the actual outcome or course of action
- It may lead to polarization of efforts, whereby, people or departments are not motivated to look beyond their own targets and help others
- It doesn’t consider the environment in which the goals are set e.g. available resources, stake holders etc.
- To avoid potential problems the SMART objectives need to be agreed
- There is no stimulation of innovation
- Managers start believing in the concept of an “ideal employee” and evaluate their subordinates based on what they expect they should be
- Targets can be misreported and objective setting may become counter –productive to the organization
- The quality of goals may be poor or unrealistic
- To implent it is time consuming and difficult to maintain
- Setting production targets may encourage resources to meet those targets through whatever means necessary, which usually results in poor quality
- Identification of all objectives is not easy
Mary Parker Follett
Mary Parker Follett is well known in the field of management theory for her humanistic and socially just viewpoint on management structures and conflict resolution within organisations. She laid the foundation for much of the modern management theories in use today. She is also one of the forerunners of feminist organisational theory which defines organisational and management concepts through women’s way of knowing and navigating the social world.
Basis of her Philosophy
- Johann Fichte (1762-1814): each ego is a social one, bound to a wider world of egos.
- From this she came to the conclusion that individuals can discover their true nature and gain freedom through the group
- George Hegel (1770-1831)
- She espoused the Gestalt notion that a person’s “true self is the group self.”
Conflict Resolution
- Submission if in a conflict situation
- When there is a struggle, someone wins and someone loses
- Compromising was not an option, especially as it appeared in labour management collective bargaining
- Integration was the best solution
- In integration, parties find a solution that did not involve compromise, submission or struggle
- It also involves finding a creative solution so that both parties can achieve their goal
Authority and Power
- Rethinking authority and power is essential to integration.
- She advocated power-with and co-action to replace power-over and coercion.
- Depersonalize orders and follow the law of the situation.
- Authority is based on knowledge and not the will of one person.
- “Power with” required “circular response,” disclosure, and open discussion.
- Follett believed in employee representation plans because of cooperation and shared power
Leadership
- Follett’s notion of the role of the leader/manager was an extension of her ideas of integration and authority.
- Control could not be achieved without integrated efforts, that is, when interests were not reconciled.
- Control was based on facts, not people; and “correlated,” not imposed from above.
- Coordination facilitated control.
- Leadership, then, involved defining the purpose of the organization and skills in coordinating and evoking the law of the situation.
- These leadership tasks were not based on the power of the leader, but a reciprocating influence of leaders and followers within the context of the situation.
Frank and Lillian Gilbreth
Frank and Lillian was a husband and wife team whose contribution helps lay the foundational principles of scientific management. They worked closely with Frederick Taylor in the early 1900s and explored how time and motion studies could be used to decide the best way for a worker to complete a task. This resulted in improvements in employee satisfaction, efficiency and productivity. They are best known for these motion studies which first started when Frank was a bricklayer. Frank observed the basic movements to lay a brick effectively and isolated them from the movements which weren’t. He then introduced his findings to the bricklayers and found that the ones that followed his recommendations increased their output from 1000 to 2700 bricks a day. He took this along with the experiences he had with Taylor and began a career in scientific management consulting with his wife. They continued to refine their methods and later used a motion picture camera and split second clock to capture specific motions which they considered the best possible way to complete a given task.
Imagine what this could do for you as a manager. If a standard set of movements, practices, methods or procedures were given to your workers how much could they accomplish in their shift? What about a in a week? A month? A year? And how much more profit could be accumulated. What the Gilbreths discovered by studying the motions of others was a way to immediately impact the bottom line for the better. There was no fancy equipment to buy, elaborate marketing schemes to draw up, or innovative products needing to be developed. All it required was time observing, analysing and scrutinising effective movements of workers while they worked. WORK SMARTER, NOT HARDER!
Task 2
Henri Fayol
Fayol was born in Istanbul I 1841. He began working as an engineer at a large mining company in France when he was 19 where eventually he became the director.
He developed what was to be considered the 14 most important principles of management. They explained how managers should organise and interact with their staff.
In 1916 he published these 14 principles of management in the book ‘Administration Industrielle et Generale’. He also created 7 primary functions which went with the principles.
Even though it is one of the earliest theories of management it still remains one of the most comprehensive with Fayol being considered one of the most influential figures in the modern concept of management.
Functions of Management
- Forecasting
- Planning
- Organising
- Commanding
- Coordinating
- Monitoring
- Communication
14 Principles of Management
- Division of Work – When employees are more specialised as a result of training, output can increase
- Authority – Managers must have the authority to give orders but with authority comes responsibility
- Discipline – There must be discipline in organisations. If someone breaks the rules they must be punished but fairly
- Unity of Command – Every employee must have one direct supervisor
- Unity of Direction – Teams that share the same objective should be working under the same manager
- Subordination of Individual Interests to the General Interest – The interest of one employee must not become more important than those of the group (including managers)
- Remuneration - Employee satisfaction depends on fair remuneration for everyone. This includes financial and non-financial compensation.
- Centralisation – This refers to how close employees are involved in the decision making. It is important to aim for an appropriate balance
- Scalar Chain – Employees must know their position in the company’s hierarchy or chain of command
- Order – The workplace facilities should be kept clean and tidy and safe for employees at all times
- Equity – Managers must be fair to staff at all times
- Stability of Tenure of Personnel – Managers must try to minimise employee turnover. Personnel planning should be a priority
- Initiative – Workers should be given a necessary level of freedom and allowed to use their own initiative
- Esprit de Corps – Organisations should strive to promote team spirit and unity
The main aim of scientific management was to identify universal principles on which production could be best organized. Henri Fayol was one of the main figures, which looked at scientific management he mainly looked at ‘The general principals of management’, which included the managing of people by forecasting, planning, organizing, commanding, coordinating, monitoring and communicating performance. Fayol saw these elements as the foundation for a manager to carry out his job, by the manager carrying out these elements on a daily basis he would be able to control the production line effectively and have a maximum output. The manager would need to be a very competent person with a wide range of skills to be able to carry out these elements, he would also need to have a competent team working around/for him for this system to work.
Task 3
Direct Line
Direct line operates by enabling a direct line of communication between certain members within the company. Members have a direct line between them and will be in contact with each other on a daily basis. This makes it easy for a subcontractor if he has a problem to get in touch with the construction manager through the direct lines. The term direct line could also mean direct contact because this is initially what it does. The direct line system allows the managing director to pass down information to all employees very easily and vice versa.
Lateral
Lateral line structure allows team members to get in contact with other members they are not directly in contact with. The lines are shown as dashed and are usually shown horizontally between different departments. These lateral lines allow information to be passed between each department without following the direct lines. This system has been proven to be effective in saving time when contacting different departments. For e.g. The head Office Manager will be able to pass messages to the Chief Accountant. The lateral lines will allow this without the managing Director having to be contacted and have them pass on a message.
Functional
A functional organizational structure is one on which the tasks, people and technologies necessary to do the work of the business are divided into separate functional groups. E.g. Finance, design, marketing and personell.
Chain of Command
The chain of command shows the commanding members. E.g. If a builder had trouble setting out a house he make ask the assistant site manager for advice. If the assistant site manager was not sure he would ask the site manager. If the site manager could not give advice he may seek a solution from someone higher than himself, this could go all the way back to the architect. . The chain of command is also the chain in which everyone is commanded within their daily tasks because you are always looking to the person higher than you for guidance and your tasks at work.
Span of Control
This is the term given to the amount of employees directly under a manager. The larger the amount of employees a manager controls, the wider his span.
It is known as a narrow span when a manager controls six or fewer employees. There is close supervision of the employees, tight control and fast communication. This supervision can sometimes be too close. There are many levels of management resulting in an excessive distance between the top and the bottom of the organisation.
A wide span is when a manger controls more than six employees. Managers are forced to delegate work and tasks may not be closely supervised. There can be problems with overloading of work and with less control. However there are fewer levels of management.
Table showing the relationship and the relative Authority and Responsibility
Responsibility within a company must be taken seriously. Managing directors are responsible for the results of the company and must make sure that all company policies are implemented by other staff. Responsibility can have its ups and downs e.g. If a project is met on time and to budget, managers will likely receive a bonus of some sort but if they fail to finish a project on time they could pay for this by getting the sack.
It is very important that an employee’s responsibilities are well defined. The organisation chart helps this by showing employees who they are directly answerable to. Without this a lot of confusion and mayhem can prevail.
Centralised and Decentralised Organisations
An important feature that affects an organisations efficiency is to the degree it is centralised or decentralised. This can be measured by;
- The extent to which managers delegate authority and decisions form the top to the lower levels in the company
- To the extent to which the administrative functions of the firm are carried out at head office rather than being spread out through the organisation. E.g. some contractors have a central buying department for all their purchases of materials. Others will allow managers in different areas to organise their own purchases.
It is not common for an organisation to be totally centralised/decentralised. Most firms try to find a balance between the two.
Typical Management Organisation Chart
Key
Direct
Lateral
Functional
Task 4
Laing O’Rourke
What They Do
They provide the full range of building and refurbishment activities, providing a complete project delivery solution that reduces interface risk. This includes ‘buildability’ studies, design for manufacture and assembly (DfMA), remediation and enabling works, logistics management, integrated construction delivery, building technologies installation and testing and commissioning of major building projects. They can provide clients with;
- Pre-construction services
- Cost planning
- Digital modelling and building animations
- Programme management services
- Supply chain procurement and management
- Safety management
- Site remediation and enabling works
- Integrated construction delivery
- Building technologies
- Logistics management
- Industrial relations management
- Quality assurance testing and commissioning
- Building renovation and re-purposing
- Decommissioning and building removal
Projects they have done include Atlantis, The Palm (Dubai), Bond Street Station (London), Al Raha Beach (Abu Dhabi) and One Hyde Park (London).
They have reduced the average size of projects which has clearly reduced margin potential relative to the larger programmes of work that were previously available
All the directors are advised on likely time commitments and are to seek approval from the board if they want to take on additional appointments. The ability of individual directors to allocate sufficient time to the discharge of their responsibilities is considered as part of the directors’ annual performance review process overseen by the Chairman. The board deal with any issues concerning the chairman’s time commitment.
All new directors must undertake an induction programme, aimed at ensuring that they are able to develop an understanding and awareness of the company’s governance structure and core and enabling processes, its people and businesses. The new directors will also meet the groups principal operations, meeting employees and gaining an understanding of the groups projects and services. Training is on-going and is provided when required. The chairman along with the group director of finance and commerce are responsible in making sure that directors are supplied with I pad based information in a timely manner that is in a form and of a quality appropriate to enable them to discharge their duties. Information is provided in a regular report to the board which will include information on operational matters, strategic developments, reports on the performance of group operations, financial performance relative to the business plan, business development, corporate responsibility and client/stakeholder relations.
Processes
Operational governance – project quality management. The Core and Enabling Processes and functional toolkits are a set of standards and procedures that guide and direct The LOR Way for finding, winning and delivering projects. This framework enables them to connect and direct all of the different decisions and activities necessary through a series of mandated process getaways to achieve maximum performance and control across the entire lifecycle of the project.
Core process – This enables business leaders to understand the critical sign off procedures in bidding and securing a project and the formal governance project which must be observed to secure optimum performance. This is also helpful for establishing accurate and reliable assesments of risk and opportunity in commercial, design, health, safety and environment and design for manufacture and assembly activities. This process is followed on all their projects.
A key element of core process is the centrally managed and governed client relationship management system, salesforce. This capture any key information in relation to the opportunities the group is pursuing, it also acts as a repository for key documentation. The information that is captured in salesforce is used across the business to aid collaboration and provide reporting at all governance levels. Opportunity pipeline information to this level of quality and detail helps ensure all bidding-related decisions are fact-based and fully informed, heightening the Group’s chance of success in the tendering phases.
Enabling process – This helps accountable project leaders to fully understand the minimum requirements, in terms of operational procedures which assure success in project design and delivery. The project leaders are also supported to ensure that their teams have the appropriate skills sets to meet the minimum requirements, allowing them to allocate responsibilities to team members clearly. Adherence to enabling process is mandatory and it is only permissible to omit elements in clearly defined circumstances, and by specific dispensation from an accountable director.
Key elements of Enabling Process are the functional toolkits, which enable accountable functional leaders and their teams to deploy current best practice procedures consistently, executing project-specific plans in an integrated and disciplined manner. At the end of a project, formal feedback is captured which ensures they are continually assimilating the best and most current ways of working.
Senior members
Ray O’Rourke, Chairman and Chief Executive – Founder of the company. He chairs the Group Executive Committee and is responsible for leading the strategic direction and operational management of the Group’s business activities.
Des O’Rourke, Deputy Chairman - Provides Board-level support to the Chairman and Chief Executive in the operational management of the Group’s business activities.
Anna Stewart, Group Director of Finance and Commerce - Responsible for the Group’s finance, commercial and work-winning functions, as well as supporting business development and Group strategy formulation.
Roger Seshan, Group Asset Optimisation and Supply Chain Director - He directs the Group’s supply chain relationships, organisational and asset optimisation, legal, internal audit and security. He will ensure they have the right strategic partnerships, organisational structures and asset utilisation plans in place to unlock value for the Group.
George Rose, Non-executive Director – He Reports to the Chairman and Chief Executive, he is Chairman of the Europe Hub and has oversight responsibility for the Audit Committee, with the objective of enhancing confidence in the integrity of the processes and procedures relating to internal control and corporate financial reporting. This includes a continuous review of the financial internal reporting systems and the work of the external auditor. The Audit Committee also plays a key role in enterprise-wide risk management.
Directors – Christakis Klerides, Victor Papadopoulos and Stelios S Anastasiades.
Keltbray Group
Keltbray are the largest specialist demolition and civil engineering contractor in the UK. Their turnover exceeds £100 with 60% of work executed on a negotiated or partnering basis.
Their services include;
- Pre-construction advice
- Groundworks
- Asbestos and hazardous waste survey and removal
- Enabling works
- Archaeological services
- De-construction and demolition
- Waste management and recycling
- Specialist design and structural engineering
- Civil engineering and superstructure works
- Environment and material management Hazardous waste management
- Multi-disciplined rail services including plant provision and overhead line engineering
They offer an integrated management system across the business based on their safety, quality and environmental policies. This provides maximum control and ensures consistency of approach. They are registered with ISO 9001, ISO 14001 and OHSAS 18001 as well as further approvals and accreditations.
They are developing through incident and injury free (IIF) a cultural and behavioural safety improvement programme which they extending by involving their supply chain.
They are committed to the three R’s – Reuse, Recovery and Recycling. They have also signed up to the WRAP protocol which will half their landfill by 50% in 2012 from their 2008 normalised levels.
The dark green indicates The Sum of all Parts
The Board
Brendan Kerr, Chief executive officer – Ensures that the group services are delivered to the highest standard
John Price, Group managing director
John Keehan, Group finance director – Assists in driving the operational and strategic development.
Phill Price, Managing director of Rail and Infrastructure
Peter Suchy, Group commercial director - Supports the strategic and operational goals of the Group, He manages the procurement, estimating and surveying functions of the Group. He sees his main role as ascertaining the profitability of the business.
Keith Elliott, Non-executive chairman
Geoff Wright, Non-executive board director
Project Delivery
Anthony Walsh, Operations director - Overseas the operational management of some of the more complex projects carried out by the Group.
Paul Deacy, Operations director – He is responsible for the operational delivery of several major projects for Keltbray and assists with strategic forward planning for key clients.
Martyn Drake, Operations director
Michael Patefield, operations director -Responsible for the operational management of demolition projects.
Jim O’Sullivan, Pre-Construction director - He is Keltbrays key account manager for Land Securities and leads the Estimating, planning and bidding activity for Keltbray Limited.
Tom McNulty, Plant manager - ensures that the Plant and qualified plant operatives are available to the workface maximising the productivity.
Adrian Scott, Haulage director – Manages Keltbray's fleet of 50 Haulage Vehicles and the Transport Supply Chain, ensuring that their project sites maximise their productivity and efficiency.
Professional services
James Scully, Group HSQE director - Responsible for the Group’s HSQE and intends to extend the development of their accreditation, competence and culture.
John Sykes, HSQE director
Cliff Burton, Environmental technical director - Fulfils a leading role as a Director of KAWS, their Joint Venture with AWS to recycle contaminated materials.
Stuart Marchand, Director, wentworth house
Steve Rowe, Estimating manager – Manages the estimating department. Analyses the project from the initial budget, through the tender process to commencement of works on site.
Martin Clark, Planning manager – Responsible for planning across the Group through the in-house planning department, providing pre-construction and live project advice.
Kate Batterbury, Executive assistant to the chief executive - Responsible for managing the day-to-day administration of the business, as well as their events and driving the Corporate Social Responsibility steering committee.
Holly Bennett, Training and development director – Is developing a comprehensive training programme for the Group including a ‘back to basics’ campaign to focus on the future and ensure specialist skills are preserved.
Thea Pretorius, IT manager - She performs the important task of driving the Information Systems and Technology across the Head Office and Project Sites. The services have to be available 24hrs a day and 365 days a year to ensure they deliver to clients.
Key Projects
- Highbury Square
- Lancaster Gate
- Quartermile, Edinburgh
- Regents Palace Hotel
- The Shard
- Three Quays
They are involved in a lot of high profile, centrally located projects which means their works are constantly on view to an informed peer group audience and the public at large.
They continue to engage and deliver on small scale projects through their specialist works team.
Conclusion
There are a number of important factors when running a company, organisational structure is one of them. The structure of a company ensures that it is run efficiently and to provide guidance and clarity on some human resources issues. This is why it is important for a newly established company to adopt these factors as early as possible.
A good organisational structure brings about a sense of purpose. Guidance is given to employees at all time. Because of this they know the report relationships that control the work flow in the company.
A formal outline of the organisation makes adding new positions very easy and flexible. This helps operations to run smoothly and the communication becomes easier.
When there is no structure at all, employees do not know who to report to when they have issues. There is also confusion with the responsibility of certain matters. All this confusion will make the business suffer. It leads to poor communication, low productivity and unaccountability.
If there is a good organisational structure, operational efficiency is improved. This is because clarity is brought out to employees of each level of the company. It also outlines which promotions are on offer. Therefore, there is a solid employee advancement track for every entry level worker.
Another important factor is that it makes decision making easier. This is because there is a protocol that is followed in the whole issue. In the flat type which is ideal for small companies, the manager can talk directly to the managing director and the assistants are two levels below the director. This means decisions can be made quickly and communicated to different departments.
It is extremely important that communication is present in every organisation. This is only possible if there is an organisational structure. It enables distribution of authority which enhances communication within the organisation. If a new employee joins the company they immediately know who to report to from the word go. Most organisations will funnel their communication through the department leaders.
With a good system, the evaluation of employee performance is better. This is down to the adequate supervision available to evaluate the work in each department. The supervisors can assess the employee’s skills, how they interact with other workers and the time it takes them to complete a task.
This makes organisational structure worth investing in. Apart from the features I have explained above it also allows a company to keep at a par with the current market situation determining it a successful or unsuccessful company.
Bibliography
Books
Construction Management: Principles and Practice – Alan Griffith, Dr Paul Watson – 2003 – ISBN 0333968786
Internet