Management—past Management—past to present to present 2 After reading Chapter 2, you should be able to answer these questions in your own words. Planning Ahead What can be learned from classical management thinking? What ideas were introduced by the human resource approaches? What is the role of quantitative analysis in management? What is unique about the systems view and contingency thinking? What are continuing management themes of the 21st century? 5. 4. 3. 2. 1. CHAPTER 2 study questions 44160_02_p32-55 1/13/04 10:07 PM Page 32
Transcript
Management — pastManagement — pastManagement — past
to presentto presentto present2
After reading Chapter 2,you should be able to answer these questions in your own words.
Planning Ahead
What can be learned from classical management thinking?
What ideas were introduced by the human resource approaches?
What is the role of quantitative analysis in management?
What is unique about the systems view and contingency thinking?
What are continuing management themes of the 21st century?
5.
4.
3.
2.
1.
CHAPTER 2 study questions
44160_02_p32-55 1/13/04 10:07 PM Page 32
“Googol” is a mathematical term standing for the number 1 fol-
lowed by 100 zeros. That’s a real big number. It’s also symbolic
of the reach of the popular Web search engine Google, now han-
dling many millions of Web searches everyday.
Google’s origins trace to 1995 when Larry Page
and Sergey Brin met as students at Stanford Uni-
versity. Their conversations led to collaboration on
a search engine they called BackRub. It became
so popular on campus that they kept refining and
expanding the service in Larry’s dormitory room.
Google, Inc., was hatched in 1998 with the
goal: “to organize the information overload of
the Internet in a transparent and superior way.”
It hasn’t stopped running, or growing, since. A
search today will examine over 300 billion Web
pages to find what you want. Some 75% of
website referrals pass through Google. And, it is
the engine that drives AOL and Yahoo searches.
Talk about success!
What is the Google difference? How did it gain such runaway
popularity? The answer is performance excellence based on
speed, accuracy, and ease of use. These have been the guiding
performance criteria from the beginning, the basis for generating
user appeal and competitive advantage in the marketplace. Page
and Brin want to create a “perfect search engine” that “understands
exactly what you mean and gives you back exactly what you want,”
says Page. With such goals, talent and motivation drive the system.
In the continuing search for innovation, the firm sticks to its his-
torical roots—an informal culture with a small company feel. At
Google creative and happy people diverse in backgrounds, skills,
and interests come together to build an ever-better search engine.
The company website describes its approach to talent this way:
“Google’s hiring policy is aggressively non-discriminatory, and fa-
vors ability over experience. The result is a staff that reflects the
global audience the search engine serves. In all, 34 languages are
spoken by Google staffers—from Turkish to Telugu. Outside of the
office, ‘Googlers’ pursue interests from cross-country cycling to
wine tasting, from flying to Frisbee.”1
GOOGLE, INC.—PRACTICE MAKES PERFECT
Get Connected!
There's more to Google
than meets the eye.
Optimize your searches
by learning more at
Google Help Central.
44160_02_p32-55 1/13/04 10:07 PM Page 33
34 Chapter 2 Management — Past to Present
The problems and opportunities facing organizations today arecomplex, ever-present, and always changing. From the anxieties ofterrorism to the uncertainties of international politics to the chal-lenges of globalization, all of society’s institutions feel the pres-
sures of a new and very challenging environment. The world of work andbusiness as we have known it is being transformed as traditional ways ofdoing things are replaced by new practices and viewpoints. But even inthe rush toward an exciting future, one shouldn’t sell history short.Knowledge gained through past experience can and should be used as afoundation for future success.
When Harvard University Press released Mary Parker Follett—Prophet ofManagement: A Celebration of Writings from the 1920s, it clearly remindedus of the wisdom of history.2 Although Follett wrote in a different day andage, her ideas are rich with foresight. She advocated cooperation and betterhorizontal relationships in organizations, taught respect for the experienceand knowledge of workers, warned against the dangers of too much hierar-chy, and called for visionary leadership. Today we pursue similar themeswhile using terms like “empowerment,” “involvement,” “flexibility,” and “self-management.” Rather than naively believe that we are reinventing manage-ment practice, it is better to recognize the historical roots of many modernideas and admit that we are still trying to perfect them.3
Just as a Google search churns through billions of websites, Google’sfounders and staffers continuously strive to learn from past experienceand apply their expertise to continuously improving the company. Thesame holds as scholars work within the field of management itself. InChapter 2 you will become acquainted with the historical roots of manage-ment and learn how they created the knowledge base that today helps youand others become better managers.
In The Evolution of Management Thought, Daniel Wren traces manage-ment as far back as 5000 B.C., when ancient Sumerians used writtenrecords to assist in governmental and commercial activities.4 Managementwas important to the construction of the Egyptian pyramids, the rise ofthe Roman Empire, and the commercial success of 14th-century Venice.By the time of the Industrial Revolution in the 1700s, great social changeshelped prompt a great leap forward in the manufacture of basic staplesand consumer goods. Industrial development was accelerated by AdamSmith’s ideas of efficient production through specialized tasks and the di-vision of labor. By the turn of the 20th century, Henry Ford and otherswere making mass production a mainstay of the emerging economy. Sincethen, the science and practices of management have been on a rapid andcontinuing path of development.
CLASSICAL MANAGEMENT APPROACHES
Our study of management begins with the classical approaches: (1) scien-tific management, (2) administrative principles, and (3) bureaucratic orga-nization.5 Figure 2.1 associates each with a prominent person in the his-tory of management thought. These names are important to know sincethey are still widely used in management conversations today. Also, thefigure shows that the classical approaches share a common assumption:People at work act in a rational manner that is primarily driven by eco-nomic concerns. Workers are expected to rationally consider opportunitiesmade available to them and do whatever is necessary to achieve the great-est personal and monetary gain.6
SCIENTIFIC MANAGEMENT
In 1911 Frederick W. Taylor published The Principles of Scientific Manage-ment, in which he makes the following statement: “The principal object ofmanagement should be to secure maximum prosperity for the employer,coupled with the maximum prosperity for the employee.”7 Taylor, oftencalled the “father of scientific management,” noticed that many workersdid their jobs their own way and without clear and uniform specifications.He believed that this caused them to lose efficiency and perform belowtheir true capacities. He also believed that this problem could be correctedif workers were taught and then helped by supervisors to always performtheir jobs in the right way.
Classical Management Approaches 35
Classicalapproaches
Assumption: People arerational
Scientificmanagement
Frederick TaylorThe Gilbreths
Administrativeprinciples
Henry FayolMary Parker Follett
Bureaucraticorganization
Max Weber
Figure 2.1 Major branches in the classical approach to management.
www.maids.com
Maids Internationalconducted systematic studiesof high labor turnover. Taskswere redesigned, and timewas provided for relaxation.CEO Dan Bishop says:“Fatigue and boredom arewhat burn people out. Wetried to eliminate them.”
44160_02_p32-55 1/13/04 10:07 PM Page 35
36 Chapter 2 Management — Past to Present
Taylor’s goal was to improve the productivity of people at work. Heused the concept of “time study” to analyze the motions and tasks re-quired in any job and to develop the most efficient ways to perform them.8
He then linked these job requirements with both training for the workerand support from supervisors in the form of proper direction, work assis-tance, and monetary incentives. The implications of his efforts are foundin many management settings today, as summarized in Manager’sNotepad 2.1. Taylor’s approach is known as scientific management andincludes these four guiding action principles.
1. Develop for every job a “science” that includes rules of motion, stan-dardized 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 incen-
tives 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.
Mentioned in Taylor’s first principle, motion study is the science ofreducing a job or task to its basic physical motions. Two contemporariesof Taylor, Frank and Lillian Gilbreth, pioneered motion studies as a man-agement tool. In one famous study they reduced the number of motionsused by bricklayers and tripled their productivity.9 The Gilbreths’ work es-tablished the foundation for later advances in the areas of job simplifica-tion, work standards, and incentive wage plans—all techniques still usedin the modern workplace.
An example of the continuing influence of Taylor and the Gilbreths canbe seen at United Parcel Service, where workers are guided by carefully cali-brated productivity standards. At regional centers, sorters are timed accord-ing to strict task requirements and are expected to load vans at a set num-ber of packages per hour. Delivery stops on regular van routes are studiedand carefully timed, and supervisors generally know within a few minuteshow long a driver’s pickups and deliveries will take. Industrial engineers de-vise precise routines for drivers, who are trained to knock on customers’doors rather than spend even a few seconds looking for the doorbell. Hand-held computers further enhance delivery efficiencies. At UPS, savings ofseconds on individual stops add up to significant increases in productivity.
ADMINISTRATIVE PRINCIPLES
A second branch in the classical approaches to management includes at-tempts to document and understand the experiences of successful man-
Principles of scientific man-agement
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 that they can perform jobs to
the best of their abilities.
Scientific managementemphasizes careful selec-tion and training of workersand supervisory support.
Motion study is the sci-ence of reducing a task toits basic physical motions.
MANAGER’S NOTEPAD 2.1
44160_02_p32-55 1/13/04 10:07 PM Page 36
agers. Two prominent writers in this school of thought are Henri Fayol andMary Parker Follett.
Henri Fayol
In 1916, after a career in French industry, Henri Fayol published Adminis-tration Industrielle et Générale.10 The book outlines his views on the propermanagement of organizations and the people within them. It identifies thefollowing five “rules” or “duties” of management, which closely resemblethe four functions of management—planning, organizing, leading, andcontrolling—that we talk about today:
1. Foresight— to complete a plan of action for the future.2. Organization— to provide and mobilize resources to implement the
plan.3. Command— to lead, select, and evaluate workers to get the best work
toward the plan.4. Coordination— to fit diverse efforts together, and ensure information is
shared and problems solved.5. Control— to make sure things happen according to plan and to take
necessary corrective action.
Most importantly, Fayol believed that management could be taught.He was very concerned about improving the quality of management andset forth a number of “principles” to guide managerial action. A number ofthem are still part of the management vocabulary. They include Fayol’sscalar chain principle— there should be a clear and unbroken line of com-munication from the top to the bottom in the organization; the unity ofcommand principle—each person should receive orders from only oneboss; and the unity of direction principle—one person should be in chargeof all activities that have the same performance objective.
Mary Parker Follett
Another contributor to the administrative principles school was MaryParker Follett, who was eulogized at her death in 1933 as “one of the mostimportant women America has yet produced in the fields of civics and so-ciology.”12 In her writings about businesses and other organizations, Fol-lett displayed an understanding of groups and a deep commitment to hu-man cooperation—ideas that are highly relevant today. For her, groups
Classical Management Approaches 37
Fayol’s rules of manage-ment
Around the world
Quality practices readily travel the world
When Mercedes Benz set up manufacturing in the United States, thebest of its German management practices came, too.11 The German au-tomaker expects and teaches its American workers to follow precisestandards known at SMPs (standard methods and procedures). TheSMPs specify everything right down to the way a lug nut should be tight-ened and where a tool should be placed when not in use. Mercedes be-lieves this is the key to maintaining high-quality and high-performancestandards, no matter where in the world its automobiles are manufac-tured. A spokesperson says: “Our success would not have been possiblewithout the great partnership we formed with the State of Alabama andwithout the strong workforce that we have found here.”
44160_02_p32-55 1/13/04 10:07 PM Page 37
38 Chapter 2 Management — Past to Present
were mechanisms through which diverse individuals could combine theirtalents for a greater good. She viewed organizations as “communities” inwhich managers and workers should labor in harmony, without one partydominating the other and with the freedom to talk over and truly reconcileconflicts and differences. She believed it was the manager’s job to helppeople in organizations cooperate with one another and achieve an inte-
gration of interests.A review of Dynamic Administration: The Collected
Papers of Mary Parker Follett helps to illustrate the mod-ern applications of her management insights.14 Follettbelieved that making every employee an owner in thebusiness would create feelings of collective responsibil-ity. Today, we address the same issues under such la-bels as “employee ownership,” “profit sharing,” and“gain-sharing plans.” Follet believed that business prob-lems involve a wide variety of factors that must be con-sidered in relationship to one another. Today, we talkabout “systems” when describing the same phenome-non. Follett believed that businesses were services and
that private profits should always be considered vis-à-vis the public good.Today, we pursue the same issues under the labels of “managerial ethics”and “corporate social responsibility.”
BUREAUCRATIC ORGANIZATION
Max Weber was a late-19th-century German intellectual whose insightshave had a major impact on the field of management and the sociology oforganizations. His ideas developed somewhat in reaction to what he con-sidered to be performance deficiencies in the organizations of his day.Among other things, Weber was concerned that people were in positions ofauthority not because of their job-related capabilities, but because of theirsocial standing or “privileged” status in German society. For this and otherreasons, he believed that organizations largely failed to reach their per-formance potential.
At the heart of Weber’s thinking was a specific form of organizationhe believed could correct the problems just described—a bureau-cracy.15 This is an ideal, intentionally rational, and very efficient form oforganization founded on principles of logic, order, and legitimate author-ity. The defining characteristics of Weber’s bureaucratic organization areas follows:
• Clear division of labor: Jobs are well defined, and workers becomehighly skilled at performing them.
• Clear hierarchy of authority: Authority and responsibility are well de-fined for each position, and each position reports to a higher-level one.
• Formal rules and procedures: Written guidelines direct behavior and de-cisions in jobs, and written files are kept for historical record.
• Impersonality: Rules and procedures are impartially and uniformly ap-plied with no one receiving preferential treatment.
• Careers based on merit: Workers are selected and promoted onability and performance, and managers are career employees of theorganization.
Weber believed that organizations would perform well as bureaucra-cies. They would have the advantages of efficiency in utilizing resources
R E A L I T YC H E C KC H E C K 2 . 12 . 1Top traits for bossesAmerican workers want more from their bosses,and that includes more attention to ethical be-havior—doing things right. A survey by RightManagement Consultants listed “honesty” as themost desired trait in a boss. Take the online “Re-ality Check” to learn more about what workerssay about the traits which they most desire in asupervisor.13
Characteristics of Weber’sbureaucracy
A bureaucracy is a ratio-nal and efficient form of or-ganization founded on logic,order, and legitimate au-thority.
44160_02_p32-55 1/13/04 10:07 PM Page 38
and of fairness or equity in the treatment of employees and clients. In hiswords:
The purely bureaucratic type of administrative organization . . . is,from a purely technical point of view, capable of attaining the highestdegree of efficiency . . . . It is superior to any other form in precision,in stability, in the stringency of its discipline, and in its reliability. Itthus makes possible a particularly high degree of calculability of re-sults for the heads of the organization and for those acting in relationto it. It is finally superior both in intensive efficiency and in the scope ofits operations and is formally capable of application to all kinds of ad-ministrative tasks.16
This is the ideal side of bureaucracy. However, the terms “bureau-cracy” and “bureaucrat” are now often used with negative connotations.The possible disadvantages of bureaucracy include excessive paperwork or“red tape,” slowness in handling problems, rigidity in the face of shiftingcustomer or client needs, resistance to change, and employee apathy.These disadvantages are most likely to cause problems for organizationsthat must be flexible and quick in adapting to changing circumstances—acommon situation today. Thus researchers now try to determine when andunder what conditions bureaucratic features work best. They also want toidentify alternatives to the bureaucratic form. Current trends in manage-ment include many innovations that seek the same goals as Weber butwith different approaches to how organizations can be structured.
Behavioral Management Approaches 39
Learning check 1Be sure you can • list the principles of Taylor’s scientific management • list thekey characteristics of bureaucracy and explain why Weber considered it an idealform of organization • identify possible disadvantages of bureaucracy in today’senvironment
BEHAVIORAL MANAGEMENT APPROACHES
During the 1920s, an emphasis on the human side of the workplace beganto influence management thinking. Major branches in the behavioral orhuman resource approaches to management are shown in Figure 2.2. Theyinclude the famous Hawthorne studies and Maslow’s theory of humanneeds, as well as theories generated from these foundations by DouglasMcGregor, Chris Argyris, and others. The behavioral approaches maintain
Human resource approaches
Assumption:People are social
and self-actualizing
Hawthorne studies
Elton Mayo
Theory of human needs
Abraham Maslow
Theory X and Theory Y
Douglas McGregor
Personality and organization
Chris Argyris
Figure 2.2 Foundations in the behavioral or human resource approaches tomanagement.
44160_02_p32-55 1/13/04 10:07 PM Page 39
40 Chapter 2 Management — Past to Present
that people are social and self-actualizing. People at work are assumedto seek satisfying social relationships, respond to group pressures, andsearch for personal fulfillment.
THE HAWTHORNE STUDIESAND HUMAN RELATIONS
In 1924, the Western Electric Company (predecessor to today’s LucentTechnologies) commissioned a research program to study individual pro-ductivity at the Hawthorne Works of the firm’s Chicago plant.17 The initial“Hawthorne studies” had a scientific management perspective and soughtto determine how economic incentives and the physical conditions of theworkplace affected the output of workers. An initial focus was on the levelof illumination in the manufacturing facilities; it seemed reasonable to ex-pect that better lighting would improve performance. After failing to findthis relationship, however, the researchers concluded that unforeseen“psychological factors” somehow interfered with their illumination experi-ments. This finding and later Hawthorne studies directed attention towardhuman interactions in the workplace and ultimately had a major influenceon the field of management.
Relay Assembly Test-Room Studies
In 1927, a team led by Harvard’s Elton Mayo began more research to exam-ine the effect of worker fatigue on output. Care was taken to design a scien-tific test that would be free of the psychological effects thought to have con-founded the earlier illumination studies. Six workers who assembled relayswere isolated for intensive study in a special test room. They were given var-ious rest pauses, and workdays and workweeks of various lengths, and pro-duction was regularly measured. Once again, researchers failed to find anydirect relationship between changes in physical working conditions andoutput. Productivity increased regardless of the changes made.
Mayo and his colleagues concluded that the new “social setting” cre-ated for workers in the test room accounted for the increased productivity.Two factors were singled out as having special importance. One was thegroup atmosphere; the workers shared pleasant social relations with one
In practice
People hold the keys to long-term performancesuccess
Toronto-based Four Seasons Hotels and Resorts seeks employees whoare friendly, committed to teamwork, and, of course, highly talented. Thefirm declares that quality of service is “so critically important to ourguests, and the degree to which we can provide and evolve it, worldwide,is also the degree to which we can differentiate ourselves and stayahead of the rest.” Four Seasons is a leader in the luxury segment of thehospitality industry. Its strengths and reputation are cultivated with lead-ership commitment to a fundamental principle: The key to sustained per-formance success is people. Among the guiding values of the firm is: “webelieve that each of us needs a sense of dignity, pride and satisfaction inwhat we do.”18
44160_02_p32-55 1/13/04 10:07 PM Page 40
another and wanted to do a good job. The other was more participative su-pervision. Test-room workers were made to feel important, were given a lotof information, and were frequently asked for their opinions. This was notthe case in their regular jobs elsewhere in the plant.
Employee Attitudes, Interpersonal Relations, and Group Processes
Mayo’s research continued until the worsening economic conditions of theDepression forced their termination in 1932. By then, interest in the hu-man factor had broadened to include employee attitudes, interpersonal re-lations, and group relations. In one study, over 21,000 employees were in-terviewed to learn what they liked and disliked about their workenvironment. “Complex” and “baffling” results led the researchers to con-clude that the same things (e.g., work conditions or wages) could besources of satisfaction for some workers and of dissatisfaction for others.The final Hawthorne study was conducted in the bank wiring room andcentered on the role of the work group. A surprise finding here was thatpeople would restrict their output in order to avoid the displeasure of thegroup, even if it meant sacrificing pay that could otherwise be earned byincreasing output. Thus, it was recognized that groups can have strongnegative, as well as positive, influences on individual productivity.
Lessons of the Hawthorne Studies
As scholars now look back, the Hawthorne studies are criticized for poor re-search design, weak empirical support for the conclusions drawn, and thetendency of researchers to overgeneralize their findings.19 Yet their signifi-cance as turning points in the evolution of management thought remains in-tact. The Hawthorne studies helped shift the attention of managers andmanagement researchers away from the technical and structural concernsof the classical approach and toward social and human concerns as keys toproductivity. They showed that people’s feelings, attitudes, and relationshipswith coworkers affected their work. They recognized the importance of groupinfluences on individuals. They also identified the Hawthorne effect—thetendency of people who are singled out for special attention to perform asanticipated merely because of expectations created by the situation.
The Hawthorne studies contributed to the emergence of the humanrelations movement, which influenced management thinking during the1950s and 1960s. This movement was largely based on the viewpoint thatmanagers who used good human relations in the workplace would achieveproductivity. Importantly, this movement combined with related develop-ments in the social sciences to set the stage for what has now evolved asthe field of organizational behavior, the study of individuals and groupsin organizations.
MASLOW’S THEORY OF HUMAN NEEDS
Among the insights of the human relations movement, the work of psy-chologist Abraham Maslow in the area of human “needs” is a key founda-tion.20 A need is a physiological or psychological deficiency a person feelsthe compulsion to satisfy. This is a significant concept for managers be-cause needs create tensions that can influence a person’s work attitudesand behaviors.
Maslow identified the five levels of human needs, shown in Figure 2.3.From lowest to highest in order, they are physiological, safety, social, es-
Behavioral Management Approaches 41
The human relationsmovement suggests thatmanagers using good hu-man relations will achieveproductivity.
Organizational behavioris the study of individualsand groups in organiza-tions.
A need is a physiologicalor psychological deficiencythat a person wants to sat-isfy.
The Hawthorne effect isthe tendency of persons sin-gled out for special atten-tion to perform as expected.
44160_02_p32-55 1/13/04 10:07 PM Page 41
42 Chapter 2 Management — Past to Present
teem, and self-actualization needs. Maslow’s theory is based on two under-lying principles. The first is the deficit principle—a satisfied need is not amotivator of behavior. People act to satisfy “deprived” needs, those forwhich a satisfaction “deficit” exists. The second is the progression princi-ple— the five needs exist in a hierarchy of “prepotency.” A need at any levelis only activated when the next-lower-level need is satisfied.
According to Maslow, people try to satisfy the five needs in sequence.They progress step by step from the lowest level in the hierarchy up tothe highest. Along the way, a deprived need dominates individual atten-tion and determines behavior until it is satisfied. Then, the next-higher-level need is activated. At the level of self-actualization, the deficit andprogression principles cease to operate. The more this need is satisfied,the stronger it grows.
Consistent with human relations thinking, Maslow’s theory impliesthat managers who help people satisfy their important needs at work willachieve productivity. Although scholars now recognize that things are morecomplicated than this, as discussed in Chapter 14 on motivation, Maslow’sideas are still relevant. Consider, for example, the case of volunteer workerswho do not receive any monetary compensation. Managers in nonprofit or-ganizations have to create jobs and work environments that satisfy themany different needs of volunteers. If their work isn’t fulfilling, the volun-teers will lose interest and probably redirect their efforts elsewhere.
MCGREGOR’S THEORY X AND THEORY Y
Douglas McGregor was heavily influenced by both the Hawthorne studiesand Maslow. His classic book The Human Side of Enterprise advances thethesis that managers should give more attention to the social and self-actualizing needs of people at work.22 McGregor called upon managers to
Self-actualization needs
Highest level: need for self-fulfillment;to grow and use abilities to fullestand most creative extent
Esteem needs
Need for esteem in eyes of others;need for respect, prestige, recognitionand self-esteem, personal sense ofcompetence, mastery
Social needs
Need for love, affection, sense ofbelongingness in one's relationshipswith other people
Safety needs
Need for security, protection, andstability in the events of day-to-day life
Physiological needs
Most basic of all human needs: needfor biological maintenance; food,water and physical well-being
Figure 2.3 Maslow’s hierarchy of human needs.
44160_02_p32-55 1/13/04 10:07 PM Page 42
shift their view of human nature away from a set of assumptions he called“Theory X” and toward ones he called “Theory Y.”
According to McGregor, managers holding Theory X assumptions ap-proach their jobs believing that those who work for them generally dislikework, lack ambition, are irresponsible, are resistant to change, and preferto be led rather than to lead. McGregor considers such thinking inappro-priate. He argues instead for the value of Theory Y assumptions in whichthe manager believes people are willing to work, are capable of self-control, are willing to accept responsibility, are imaginative and creative,and are capable of self-direction.
An important aspect of McGregor’s ideas is his belief that managerswho hold either set of assumptions can create self-fulfilling prophecies—that is, through their behavior they create situations where others act inways that confirm the original expectations. Managers with Theory X as-sumptions, for example, act in a very directive “command-and-control”fashion that gives people little personal say over their work. These supervi-sory behaviors create passive, dependent, and reluctant subordinates whotend to do only what they are told to or required to do. This reinforces theoriginal Theory X viewpoint.
In contrast, managers with Theory Y perspectives behave in “participa-tive” ways that allow subordinates more job involvement, freedom, and re-sponsibility. This creates opportunities to satisfy esteem and self-actual-ization needs, and workers tend to perform as expected with initiative andhigh performance. The self-fulfilling prophecy thus becomes a positiveone. Theory Y thinking is consistent with developments in the new work-place and its emphasis on valuing workforce diversity. It is also central tothe popular notions of employee participation, involvement, empower-ment, and self-management.23
ARGYRIS’S THEORY OF ADULT PERSONALITY
Ideas set forth by the well-regarded scholar and consultant Chris Argyrisalso reflect the belief in human nature advanced by Maslow and McGre-gor. In his book Personality and Organization, Argyris contrasts the man-agement practices found in traditional and hierarchical organizations withthe needs and capabilities of mature adults.25 He concludes that some
Behavioral Management Approaches 43
Career connection
Positive management style breaks the glass ceiling
When Betsy Holden became the president and CEO of Kraft Foods, Inc.,she had earned her way to the top. With a graduate degree from North-western’s Kellogg School, she rose from division brand manager to CEO injust 16 years. Holden has been praised for “hard work, focus, and creativ-ity,” and a “positive, upbeat, enthusiastic, collaborative, and team-oriented”management style. She says: “I think I’m good at inspiring, setting a visionof what we need to go and do—and then engaging the team and puttingtogether the game plan to get there.” Career development is important toher. When helping others, she asks: “What skills do you need, what experi-ences do you need, what development do you need?” Perhaps the mostimportant testimony to her management style is the next question: “How dowe help you make that happen?”21
Theory X assumes peo-ple dislike work, lack ambi-tion, are irresponsible, andprefer to be led.
Theory Y assumes peo-ple are willing to work, ac-cept responsibility, are self-directed and creative.
A self-fulfilling prophecyoccurs when a person actsin ways that confirm an-other’s expectations.
44160_02_p32-55 1/13/04 10:07 PM Page 43
44 Chapter 2 Management — Past to Present
practices, especially those influenced by the classical management ap-proaches, are inconsistent with the mature adult personality.
Consider these examples. In scientific management, the principle ofspecialization assumes that people will work more efficiently as tasks be-come better defined. Argyris believes that this may inhibit self-actualiza-tion in the workplace. In Weber’s bureaucracy, people work in a clear hier-archy of authority, with higher levels directing and controlling lower levels.Argyris worries that this creates dependent, passive workers who feel theyhave little control over their work environments. In Fayol’s administrativeprinciples, the concept of unity of direction assumes that efficiency will in-crease when a person’s work is planned and directed by a supervisor. Ar-gyris suggests that this may create conditions for psychological failure;psychological success occurs when people define their own goals.
Like McGregor, Argyris believes that managers who treat people posi-tively and as responsible adults will achieve the highest productivity. Hisadvice is to expand job responsibilities, allow more task variety, and ad-just supervisory styles to allow more participation and promote better hu-man relations. He believes that the common problems of employee absen-teeism, turnover, apathy, alienation, and low morale may be signs of amismatch between management practices and mature adult personalities.
Learning check 2 Be sure you can • define the term Hawthorne effect • explain how theHawthorne findings influenced the development of management thought • ex-plain how Maslow’s hierarchy of needs operates in the workplace • distinguishbetween Theory X and Theory Y assumptions, and explain why McGregor fa-vored Theory Y • explain Argyris’s criticism that traditional organizational prac-tices are inconsistent with mature adult personalities
QUANTITATIVE MANAGEMENT APPROACHES
About the same time that some scholars were developing human resourceapproaches to management, others were investigating how quantitative tech-niques could improve managerial decision making. The foundation of thequantitative approaches is the assumption that mathematical techniquescan be used for better problem solving. Today these applications are increas-ingly supported and driven by computer technology and software programs.
MANAGEMENT SCIENCE
The terms management science and operations research are often used in-terchangeably to describe the scientific applications of mathematical tech-niques to management problems. A typical approach proceeds as follows. Aproblem is encountered, it is systematically analyzed, appropriate mathe-matical models and computations are applied, and an optimum solution isidentified. There are a variety of management science applications that canbe used in this way. Mathematical forecasting helps make future projectionsthat are useful in the planning process. Inventory modeling helps control in-ventories by mathematically establishing how much to order and when. Lin-ear programming is used to calculate how best to allocate scarce resourcesamong competing uses. Queuing theory helps allocate service personnel orworkstations to minimize customer waiting time and service cost. Networkmodels break large tasks into smaller components to allow for better analy-
Management scienceuses mathematical tech-niques to analyze and solvemanagement problems.
44160_02_p32-55 1/13/04 10:07 PM Page 44
sis, planning, and control of complex projects. Simulations create models ofproblems so different solutions under various assumptions can be tested.
Regardless of the specific technique used, the essence of quantitativemanagement approaches includes these characteristics. There is a focuson rational decision making that has clear action implications. The tech-niques use “economic” decision criteria, such as costs, revenues, and re-turn on investment. They also involve mathematical models that follow sophisticated rules and formulas.
APPLIED QUANTITATIVE ANALYSIS TODAY
University courses in management science, operations research, and quanti-tative business analysis provide a good introduction to these quantitativemanagement foundations. Courses in operations management apply them tothe physical production of goods and services. Since many of the techniquesare highly sophisticated, organizations often employ staff specialists to helpmanagers take advantage of them effectively. Software developments are nowmaking these techniques more readily available through easy-to-use applica-tions for desktop and even handheld personal computers. This greatly ex-pands their use throughout the workplace and makes it even more impor-tant for managers to understand the value of each technique. Always, ofcourse, mathematical solutions to problems must be supported by goodmanagerial judgment and an appreciation of the human factor.
Modern Management Approaches 45
Learning check 3Be sure you can • define the term management science • list three quantitativetechniques that are used in management today • explain how these techniqueshelp managers solve problems
www.spss.com
A popular and easy-to-usesoftware program for statisti-cal analysis is SPSS, avail-able from SPSS Inc. The firmsupports databased problemsolving, with applications tocustomer relationship man-agement and business intelligence.
MODERN MANAGEMENT APPROACHES
The modern approaches to management grew from the rich founda-tions established by the classical, human resource, and quantitativeschools of thought. According to the modern management approaches,people are complex and variable. They have many varied needs that canchange over time. They possess a range of talents and capabilities thatcan be continually developed. Organizations and managers, therefore,should respond to individual differences with a wide variety of manager-ial strategies and job opportunities. Key foundations of the modernmanagement approaches thus include the systems view of organizationsand contingency thinking. Importantly, they recognize that no onemodel or theory applies universally in all situations or to the exclusionof the others.
ORGANIZATIONS AS SYSTEMS
Formally defined, a system is a collection of interrelated parts that functiontogether to achieve a common purpose. A subsystem is a smaller compo-nent of a larger system.26 One of the earliest management writers to adopt asystems perspective was Chester Barnard. His 1938 ground-breaking bookFunctions of the Executive was based on years of experience as a telephonecompany executive.27 Barnard described organizations as cooperative sys-
A system is a collectionof interrelated parts work-ing together for a purpose.
A subsystem is a smallercomponent of a largersystem.
44160_02_p32-55 1/13/04 10:07 PM Page 45
46 Chapter 2 Management — Past to Present
tems that achieve great things by integrating the contributions of many in-dividuals to achieve a common purpose. Importantly, Barnard consideredcooperation a “conscious, deliberate, and purposeful” feature of organiza-tions. In other words, it had to be created. For him, using communication tomake this cooperation happen was the principle executive responsibility.
Management theory and practice today are influenced by the complexityof organizational systems and subsystems.28 One application is described inFigure 2.4, which is an extension of the systems view of organizations de-scribed in Chapter 1. This figure first depicts the larger organization as anopen system that interacts with its environment in the continual process oftransforming inputs from suppliers into outputs for customers. Within theorganization any number of critical subsystems can be described as part ofthe transformation process. In the figure, the operations and service man-agement systems are a central point. They provide the integration amongother subsystems, such as purchasing, accounting, sales, and information,that are essential to the work of the organization. Importantly, and as sug-gested by Barnard, high performance by the organization as a whole occursonly when each subsystem both performs its tasks well and works well incooperation with others. It is the job of managers throughout the organiza-tion to make this coordinated action possible.
CONTINGENCY THINKING
Modern management is situational in orientation; that is, it attempts toidentify practices that are the best fit with the unique demands of a sit-uation. It utilizes contingency thinking that tries to match manage-rial responses with the problems and opportunities specific to different settings, particularly those posed by individual and environmental differ-ences. In the modern management approach, there is no expectation thatone can or should find the “one best way” to manage in all circumstances.Rather, the contingency perspective tries to help managers understand sit-uational differences and respond to them in ways appropriate to theirunique characteristics.29
Contingency thinking is an important theme in this book, and its im-plications extend to all of the management functions—from planning andcontrolling for diverse environmental conditions, to organizing for different
An open system inter-acts with its environmentand transforms resource in-puts into outputs.
Contingency thinkingtries to match managementpractices with situationaldemands.
Figure 2.4. Organizations as complex networks of interacting subsystems.
Organizationalnetwork of subsystems
Purchasing andinventorysystems
Marketing, sales,and distribution
systems
Accountingand financial
systems
Informationand technology
systems
Operations andservice
managementsystems
Inputs Outputs
Suppliers Customers
44160_02_p32-55 1/13/04 10:07 PM Page 46
environments and strategies, to leading in different performance situa-tions. For example, consider again the concept of bureaucracy. Weber of-fered it as an ideal form of organization. But from a con-tingency perspective, the strict bureaucratic form is onlyone possible way of organizing things. What turns out tobe the “best” structure in any given situation will dependon many factors, including environmental uncertainty,an organization’s primary technology, and the strategybeing pursued. The strict bureaucracy works best onlywhen the environment is relatively stable and operationsare predictable. In other situations, alternative and moreflexible structures are needed. Contingency thinking rec-ognizes that what is a good structure for one organizationmay not work well for another, and what works well atone time may not work as well in the future as circum-stances change.30 This contingency approach to organization structureand design will be examined further in Chapters 10 and 11.
Continuing Management Themes 47
R E A L I T YC H E C KC H E C K 2 . 22 . 2
Mobility in American societyManagement theories and practices shouldkeep pace with changes in society at large. Didyou know that some 17 percent of Americanschange their residences each year? Take theonline “Reality Check” to learn more about mo-bility in American society. You may be surprised!
Learning check 4Be sure you can • define the terms system, subsystem, and open system • applythese concepts to describe the operations of an organization in your community• define the term contingency thinking • explain how contingency thinkingmight influence a manager’s decision to use or not use a bureaucratic approachto organization structure
CONTINUING MANAGEMENT THEMES
The many accumulating insights discussed so far helped set the founda-tion for important trends and directions in management thought thatare well in evidence as we begin the 21st century. Among the most im-portant is the recognition that we live and work in a dynamic and ever-changing environment that puts unique and never-ending pressures onorganizations. In this context, the themes reflected throughout Manage-ment 8/e include quality and performance excellence, ethics and socialresponsibility, global awareness, and the importance of new leadershipin an age of information, knowledge workers, and highly competitivebusiness environments.
QUALITY AND PERFORMANCE EXCELLENCE
The quality theme first introduced in Chapter 1 remains a very importantdirection in management today.31 Managers and workers in truly progres-sive organizations are quality conscious. They understand the basic linkbetween competitive advantage and the ability to always deliver qualitygoods and services to their customers. The best organizational cultures in-clude quality as a core value and reinforce the quality commitment in allaspects of the work environment.
Every effort is made in total quality management (TQM) to build qual-ity into all aspects of operations from initial acquisition of resources,through the transformation processes and work systems, all the way to ul-timate product delivery to customers or clients. Figure 2.5 describes thesystems context for TQM with respect to the value chain—a specific se-quence of activities that transforms raw materials into a finished good orservice.32 Quality must be maintained at each point in the value chain,
A value chain is the se-quence of activities thattransforms raw materialsinto finished goods orservices.
44160_02_p32-55 1/13/04 10:07 PM Page 47
48 Chapter 2 Management — Past to Present
whether it is performed directly by the organization or is part of its net-work of relationships with suppliers and contractors.
Closely aligned with the pursuit of quality is management commitmentto performance excellence, a theme that rose to special prominence over20 years ago when In Search of Excellence: Lessons from America’s Best-Run Companies was published by Thomas Peters and Robert Waterman.33
Based on case investigations of successful companies, they identified theeight attributes of performance excellence shown in Manager’s Notepad2.2. Although we now recognize that these attributes are but modest in-sights into a far more complex performance picture, they are useful start-ing points. In them you will find many themes and directions that are nowcommon practice in organizations today.
GLOBAL AWARENESS
We are just emerging from a decade in which the quality and performanceexcellence themes were reflected in the rise of “process reengineering,” “virtual organizations,” “agile factories,” “network firms,” and other con-cepts introduced in this book. But while the best formulas for success con-tinue to be tested and debated, an important fact remains: Much of thepressure for quality and performance excellence is created by the forces ofglobalization and a highly competitive global economy. Nowhere is this
Organization as atransformation system
Management of thevalue chain
Customersserved
Finishedproducts
distributed
People andtechnology
createproducts
Materialsreceived and
organizedfor use
Resources andmaterials
flow in
Figure 2.5. The organizational value chain.
TA K E I T T O T H E C A S E
The Coca-Cola CompanyCoke gets back to businessTalk about history! Coca-Cola for decades has been one of the world’sbest-known brands. Where in the world can you go and not be able toget a Coke? But the firm’s glorious past can’t guarantee the same fu-ture. Coke must prosper in a highly competitive soft drink industry, andsuccessfully counter all attacks by archrival Pepsi as well as those ofdiscount beverage sellers and new entrants like Virgin Cola. Pastachievements (Diet Coke) and failures (“New Coke”) provide a learn-ing base from which to craft future strategy and plans. However, likeall growth companies, Coke has to deal with the inevitable problems ofincreasing size, organizational structures, and the management of people.38
44160_02_p32-55 1/13/04 10:07 PM Page 48
challenge more evident than in the continuing efforts of businesses aroundthe globe to transform themselves into truly world-class operations.
Like the lessons of performance excellence, current trends and di-rections in global awareness have ties back to the 1980s. That was atime when the success of Japanese industry caught worldwide attentionand both scholars and consultants rushed to identify what could belearned from Japanese management practices. The books Theory Z, byWilliam Ouchi, and The Art of Japanese Management, by Richard Tan-ner Pascale and Anthony G. Athos, were among the first that called at-tention to the possible link between unique Japanese practices andbusiness success.34 Ouchi used the term “Theory Z” to describe a man-agement framework that uses insights found in the Japanese models.35
Prominent in the Theory Z management approach are such things aslong-term employment, slower promotions and more lateral job move-ments, greater attention to career planning and development, more useof consensus decision making, and high emphasis on use of teamworkand employee involvement. And even though the Japanese economy andmanagement systems face pressures of their own today, these early in-sights into the Japanese business experience helped to establish aglobal awareness that continues to enrich management thinking today.This international dimension will be emphasized throughout Manage-ment 8/e. Chapter 5 gives special attention to understanding culturalinfluences on management practices.
LEARNING ORGANIZATIONS
The change and uncertainty in today’s environment have given rise to anemphasis on creating learning organizations, ones that are able to contin-ually learn and adapt themselves to new circumstances. Such organiza-
Continuing Management Themes 49
Eight attributes of performance excellence
••• Bias toward action—making decisions and making sure things get
done.
••• Closeness to the customers—knowing their needs and valuing cus-
tomer satisfaction.
••• Autonomy and entrepreneurship—supporting innovation, change,
and risk taking.
••• Productivity through people—valuing human resources as keys to
quality and performance.
••• Hands-on and value-driven—having a clear sense of organizational
purpose.
••• Sticking to the knitting—focusing resources and attention on what the
organization does best.
••• Simple form and lean staff—minimizing management levels and staff
personnel.
••• Simultaneous loose-tight properties—allowing flexibility while staying
in control.
MANAGER’S NOTEPAD 2.2
Theory Z describesmanagement emphasizinglong-term employment, con-sensus, and teamwork.
A learning organizationcontinuously changes andimproves, using the lessonsof experience.
44160_02_p32-55 1/13/04 10:07 PM Page 49
50 Chapter 2 Management — Past to Present
tions are successful because they are uniquely capable of improving them-selves by learning from experience. Consultant Peter Senge popularized theconcept of the learning organization in his book The Fifth Discipline, and heidentifies the following as its core ingredients.36
1. Mental models—everyone sets aside old ways of thinking.2. Personal mastery—everyone becomes self-
aware and open to others.3. Systems thinking—everyone learns how
the whole organization works.4. Shared vision—everyone understands and
agrees to a plan of action.5. Team learning—everyone works together to
accomplish the plan.
Organizations that meet Senge’s criteriafor learning organizations offer work settingsin which members develop their abilities tolearn and are encouraged and helped tomake that learning continuously available toeveryone else. They have value-driven organi-zational cultures that emphasize informationsharing, teamwork, empowerment, participa-tion, and learning. Importantly, the leadersof learning organizations set an example forothers by embracing change and communi-cating enthusiasm for solving problems andgrowing with new opportunities.
21st-CENTURY LEADERSHIP
There is no doubt that today’s social, political,and economic forces make it necessary forpeople and organizations to continually adaptto new situations if they are to survive andprosper over the long run. Learning, learning,and more learning is the new reality of work inthe 21st century. This fact carries with it dis-tinctive personal development and leadershipchallenges. And when it comes to leadership,history once again sets the stage for the fu-ture. In his book No Easy Victories, JohnGardner speaks of leadership as a special re-sponsibility, and his words are well worth con-sidering today.
Leaders have a significant role in creatingthe state of mind that is the society. Theycan serve as symbols of the moral unity ofthe society. They can express the values thathold the society together. Most important,
they can conceive and articulate goals that lift people out of their pettypreoccupations, carry them above the conflicts that tear a societyapart, and unite them in the pursuit of objectives worthy of their bestefforts.37
Now is a very good time for you to examine your LEARNING
STYLE. Every person a manager deals with is unique; most
problem situations are complex; and things are always
changing. Success in management only comes to those
who thrive on learning. Some people learn by watching;
they observe others and model what they see. Others
learn by doing; they act and experiment, learning as they
go. There is no one best way to learn about managing—
there is only the need to learn . . . all the time, from oth-
ers, from formal training, and from real experiences. An or-
ganization development manager at PepsiCo once said: “I
believe strongly in the notion that enhancing managers’
knowledge of their strengths and particularly their weak-
nesses is integral to ensuring long-term, sustainable per-
formance improvement and executive success.”24 The
problem is that many of us never dig deep enough to both
get this depth of personal understanding and use it to set
learning goals. You can start here by keeping a personal
strengths and weaknesses scorecard.
Personal management
Get to know yourself betterComplete Self-Assessments #3 — Learning Tendencies, and#4 — What are Your Managerial Assumptions?, from theManagement Learning Workbook.
Strengths
Weaknesses
Where I am now Learning goals
Where I am now Learning goals
Core ingredients of a learn-ing organization
44160_02_p32-55 1/13/04 10:07 PM Page 50
Leadership and the new directions of learning organizations are sin-gled out again and again in Management 8/e as important keys to per-sonal and organizational performance.
Managers of the 21st century will have to excel as never before to meetthe expectations held of them and of the organizations they lead. Impor-tantly, we must all recognize that new managerial outlooks and new man-agerial competencies appropriate to the new times are requirements for fu-ture leadership success. At the very least, the 21st-century manager mustbe a:
• Global strategist—understanding the interconnections among nations,cultures, and economies; planning and acting with due consideration ofthem.
• Master of technology—comfortable with information technology; under-standing technological trends and their implications; able to use tech-nology to best advantage.
• Inspiring leader—attracting highly motivated workers and inspiringthem with a high-performance culture where individuals and teams cando their best work.
• Model of ethical behavior—acting ethically in all ways, setting high ethi-cal standards for others to follow, building a work culture that valuesethics and social responsibility.
Management scholar and consultant Peter Drucker calls this the age ofinformation and considers knowledge the principal resource of a competi-tive society. Drucker also cautions that knowledge constantly makes itselfobsolete.39 In a society where knowledge workers are increasingly impor-tant, this means that new managers must be well educated . . . and theymust continue that education throughout their careers. Success in turbu-lent times comes only through learning and continuous improvement.
The new economy requires everyone—you included—to be unrelentingin efforts to develop, refine, and maintain job-relevant skills and competen-cies. It requires leaders with strong people skills, ones attuned to the natureof an information/service society, ones who understand the internationaldimensions, and ones who establish commitments to work-life balance. Andthe new economy places a premium on high-performance leadership. Con-sider, for example, this comment by former corporate CEO and collegepresident Ralph Sorenson: “It is the ability to make things happen that mostdistinguishes the successful manager from the mediocre or unsuccessfulone. . . . The most cherished manager is the one who says ‘I can do it,’ andthen does.”40
“Do it,” advises Sorenson. “Of course,” you may quickly answer. Butdon’t forget that the 21st-century manager must also do the “right”things—the things that really count, the things that add value to the orga-nization’s goods and/or services, the things that make a real difference inperformance results and competitive advantage, and the ethical things.Those are challenging directions for leadership and career success in thenew economy.
Continuing Management Themes 51
Learning check 5Be sure you can • define the term value chain • illustrate how the value chainoperates in an organization that you know • explain Theory Z • list thecharacteristics of a learning organization • discuss special characteristics of21st-century leaders • discuss your personal responsibilities for learning andperformance
Characteristics of the 21st-century executive
44160_02_p32-55 1/13/04 10:07 PM Page 51
52 Chapter 2 Management — Past to Present
INTEGRATED LEARNING ACTIVITIES
C H A P T E R 2 S T U D Y G U I D E
Where We’ve BeenWhere We’ve BeenWhere We’ve Been
Back to Google, Inc.
The opening example of Google, Inc., introduced you to the world of high technol-ogy and the opportunities of getting connected in our digital world. But it is impor-tant to remember that Google couldn’t have been created without the knowledgemade available by the full history of research and development in computer sci-ence. Now it’s an organization that is turning its founders’ commitments to learninginto the pathway toward the future. In Chapter 2 you learned the major historicalroots that influence the study of management. As you read further in Management8/e, keep the lessons of history in mind. The management theories and conceptswe value today have strong links to the past.
THE NEXT STEP
Cases/Projects
• Coca-Cola Case• Outback Steakhouse
Integrating Case• Project 3—Globalization
Self-Assessments
• A 21st-Century Manager? (#1)• Learning Tendencies (#3)• What Are Your Managerial
Assumptions? (#4)• Cognitive Style (#25)
Experiential Exercises
• What Would the Classics Say?(#4)
• The Great ManagementHistory Debate (#5)
• What Do You Value in Work?(#7)
STUDY QUESTIONS SUMMARY
What can be learned from classical managementthinking?
• Frederick Taylor’s four principles of scientificmanagement focused on the need to carefullyselect, train, and support workers for individ-ual task performance.
• Henri Fayol suggested that managers shouldlearn what are now known as the managementfunctions of planning, organizing, leading, andcontrolling.
• Max Weber described bureaucracy with itsclear hierarchy, formal rules, and well-definedjobs as an ideal form of organization.
1. What ideas were introduced by the human re-source approaches?
• The human resource or behavioral approachesshifted attention toward the human factor as akey element in organizational performance.
• The historic Hawthorne studies suggested thatwork behavior is influenced by social and psy-chological forces and that work performancemay be improved by better “human relations.”
• Abraham Maslow’s hierarchy of human needsintroduced the concept of self-actualizationand the potential for people to experience self-fulfillment in their work.
2.
44160_02_p32-55 1/13/04 10:07 PM Page 52
Key Terms Review 53
• Douglas McGregor urged managers to shiftaway from Theory X and toward Theory Y think-ing, which views people as independent, re-sponsible, and capable of self-direction in theirwork.
• Chris Argyris pointed out that people in theworkplace are adults and may react negativelywhen constrained by strict management prac-tices and rigid organizational structures.
What is the role of quantitative analysis in man-agement?
• The availability of high-power desktop com-puting provides new opportunities for mathe-matical methods to be used for managerialproblem solving.
• Many organizations employ staff specialistswho are experts in quantitative managementscience and operations research.
• Quantitative techniques used by managersinclude forecasting, linear programming, andsimulation, among others.
What is unique about the systems view and con-tingency thinking?
• Organizations are complex open systems thatinteract with their external environments totransform resource inputs into product outputs.
4.
3.
• Resource acquisition and customer satisfactionare important requirements in the organiza-tion-environment relationship.
• Organizations are composed of many internalsubsystems that must work together in a coor-dinated way to support the organization’s over-all success.
• Contingency thinking avoids “one best way” ar-guments, recognizing the need to understandsituational differences and respond appropri-ately to them.
What are continuing management themes of the21st century?
• The commitment to meet customer needs guidesorganizations toward total quality managementand continuous improvement of operations.
• Interest in Japanese management practices il-lustrates the opportunities to learn new waysof managing from practices in other countries.
• Changing times place great value on learningorganizations, ones that are able to continuallylearn and adapt themeselves to changing cir-cumstances.
• New managers must accept and excel at 21st-century leadership responsibilities to performas global strategists, technology masters, sen-sitive politicians, leader/motivators, and ethi-cal role models.
5.
KEY TERMS REVIEW
Bureaucracy (p. 38)Contingency thinking
(p. 46)Hawthorne effect
(p. 41)Human relations
movement (p. 41)Learning organization
(p. 49)
Management science (p. 44)
Motion study (p. 36)Need (p. 41)Open system (p. 46)Organizational behavior
(p. 41)Scientific management
(p. 36)
Self-fulfilling prophecies(p. 43)
Subsystem (p. 45)System (p. 45)Theory X (p. 43)Theory Y (p. 43)Theory Z (p. 49)Value chain (p. 47)
44160_02_p32-55 1/21/04 8:51 AM Page 53
54 Chapter 2 Management — Past to Present
SELF-TEST 2
MULTIPLE-CHOICE QUESTIONS:
1. The assumption that people are complex with widely varying needs is most associated with the ________management approaches.(a) classical (b) neoclassical (c) behavioral (d) modern
2. The father of scientific management is _________.(a) Weber (b) Taylor (c) Mintzberg (d) Katz
3. The Hawthorne studies are important because they raised awareness of the important influences of__________ on productivity.(a) structures (b) human factors (c) physical work conditions (d) pay and rewards
4. Advice to study a job and carefully train workers to do that job with financial incentives tied to job perfor-mance would most likely come from _________.(a) scientific management (b) contingency management (c) Henri Fayol (d) Abraham Maslow
5. The highest level in Maslow’s hierarchy is the level of _____ needs.(a) safety (b) esteem (c) self-actualization (d) physiological
6. Conflict between the mature adult personality and a rigid organization was a major concern of___________.(a) Argyris (b) Follett (c) Gantt (d) Fuller
7. When people perform in a situation as they are expected to, this is sometimes called the _________effect.(a) Hawthorne (b) bureaucratic (c) contingency (d) open-systems
8. Linear programming and queuing theory are examples of techniques found in the ________ approach tomanagement.(a) classical (b) quantitative (c) bureaucratic organization (d) modern
9. Resource acquisition and customer satisfaction are important when an organization is viewed as a(n)______.(a) bureaucracy (b) closed system (c) open system (d) pyramid
10. Long-term employment and consensus decision making are characteristic of the ________ managementframework.(a) Theory X (b) Theory Y (c) Theory Z (d) contingency
11. When your local bank or credit union is viewed as an open system, the loan-processing department wouldbe considered a _________.(a) subsystem (b) closed system (c) resource input (d) value center
12. When a manager notices that Sheryl has strong social needs and puts her in a job that involves customerrelations, while also being sure to give Kwabena lots of praise because of his strong ego needs, the man-ager is displaying __________.(a) systems thinking (b) Theory X (c) motion study (d) contingency thinking
44160_02_p32-55 1/13/04 10:07 PM Page 54
Self-Test 2 55
13. If you conducted a value chain analysis of a business, you would study _________.(a) customer satisfaciton with products (b) how much TQM affect profits (c) the flow of activities that trans-form resources into goods and services (d) the links between performance and rewards
14. In a learning organization, as described by Peter Senge, one would expect to find ________.(a) priority placed on following rules and procedures (b) promotions based on seniority (c) employees whoare willing to set aside old thinking and embrace new ways (d) a strict hierarchy of authority
15. 21st-century leaders must, according to Ralph Sorenson, be able to add value to organizations by_________.(a) taking action to make things happen (b) building efficient structures (c) keeping customers happy (d)using mathematics for decision making
SHORT-RESPONSE QUESTIONS:
16. Explain how McGregor’s Theory Y assumptions can create self-fulfilling prophecies consistent with thecurrent emphasis on participation and involvement in the workplace.
17. How do the deficit and progression principles operate in Maslow’s hierarchy-of-needs theory?
18. Define “contingency thinking” and give an example of how it might apply to management.
19. Explain why the external environment is so important in the open-systems view of organizations.
APPLICATION QUESTION:
20. Enrique Temoltzin has just been appointed the new manager of your local college bookstore. Enriquewould like to make sure the store operates according to Weber’s bureaucracy. Describe the characteristicsof bureaucracy and answer this question: Is the bureaucracy a good management approach for Enrique tofollow? Discuss the possible limitations of bureaucracy and the implications for managing people as keyassets of the store.
