1)Max Weber Bureaucracy Theory

Max Weber, a German scientist, defines bureaucracy as a highly structured, formalized, and also an
impersonal organization.

He also instituted the belief that an organization must have a defined hierarchical structure and clear
rules, regulations, and lines of authority which govern it. Max Weber bureaucracy ideally has the
following characteristics:

 Specialization of labor
 A formal set of rules and regulations
 Well-defined hierarchy within the organization
 Impersonality in the application of rules

Browse more Topics under Evolution Of Management Thought

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Max Weber Bureaucracy Theory

                                                                         
Source: Wikipedia

Bureaucratic organizations evolved from traditional structures due to the following changes:
  In traditional structures, the leader delegates duties and can change them at any time.
However, over time, this changed and there was a clear specification of jurisdiction areas
along with a distribution of activities as official duties.
 In a bureaucratic organization, the subordinates follow the order of superiors but can
appeal if they feel the need. On the other hand, in traditional structures, the authority was
diffused.
 Rules are exhaustive, stable, and employees can learn them easily. Further, the
organization records them in permanent files.
 Personal property is separate from the office property. Also, the means of production or
administration belong to the office.
 The selection of officials is based on technical qualification and appointment and not an
election. Further, officials receive a salary as compensation for their work.
 The official is taken in for a trial period and then offered a permanent position with the
organization. This protects him from arbitrary dismissal.
Learn more about Classical Organizational Theory here in detail.

Max Weber’s Bureaucratic Form – 6 Major Principles

Max Weber listed six major principles of the bureaucratic form as follows:

1. A formal hierarchical structure – In a bureaucratic organization, each level controls the

level below it. Also, the level above it controls it. A formal hierarchy is the basis of central
planning and centralized decision-making.
2. Rules-based Management – The organization uses rules to exert control. Therefore, the
lower levels seamlessly execute the decisions made at higher levels.
3. Functional Specialty organization – Specialists do the work. Also, the organization
divides employees into units based on the type of work they do or the skills they possess.
4. Up-focused or In-focused Mission – If the mission of the organization is to serve the
stockholders, board, or any other agency that empowered it, then it is up-focused. On the other
hand, if the mission is to serve the organization itself and those within it (like generating
profits, etc.), then it is in-focused.
5. Impersonal – Bureaucratic organizations treat all employees equally. They also treat all
customers equally and do not allow individual differences to influence them.
6. Employment-based on Technical Qualifications – Selection as well as the promotion of
employees is based on technical qualifications and skills.
While these rules have received criticisms from many corners, the bureaucratic form of the
organization continues to live on.

Why is a Bureaucratic Organization criticized?

Here are some reasons:

 The rules are inflexible and rigid. Further, there is too much emphasis on these rules and
regulations.
 Informal groups do not receive any importance. In current times, informal groups play a
huge role in most business organizations.
 Typically, bureaucracy involves a lot of paperwork which leads to a waste of time, money,
and also effort.
 The rules and formalities lead to an unnecessary delay in the decision-making process.
 While Government organizations can benefit from a bureaucratic structure, business
organization need quick decision-making and flexibility in procedures. Therefore, it is not
suitable for the latter.
  While the technical qualifications of the employee is an important aspect of his promotion,
a bureaucratic organization does not consider the employee’s commitment and dedication.
 There is limited scope for Human Resource management.
 Coordinating and communicating is difficult.

2)Planning
Definition: Planning is the fundamental management function, which involves deciding
beforehand, what is to be done, when is it to be done, how it is to be done and who is
going to do it. It is anintellectual process which lays down an organisation’s objectives
and develops various courses of action, by which the organisation can achieve those
objectives. It chalks out exactly, how to attaPlanning Process

The planning function of management is one of the most crucial ones. It involves setting the
goals of the company and then managing the resources to achieve such goals. As you can
imagine it is a systematic process involving eight well thought out steps. Let us take a look at the
planning process.

] Recognizing Need for Action

An important part of the planning process is to be aware of the business opportunities in

the firm’s external environment as well as within the firm.  Once such opportunities get
recognized the managers can recognize the actions that need to be taken to realize them.
A realistic look must be taken at the prospect of these new opportunities and SWOT
analysis should be done.

Say for example the government plans on promoting cottage industries in semi-urban

areas. A firm can look to explore this opportunity.

2] Setting Objectives
This is the second and perhaps the most important step of the planning process. Here we
establish the objectives for the whole organization and also individual departments.
Organizational objectives provide a general direction, objectives of departments will be
more planned and detailed.

Objectives can be long term and short term as well. They indicate the end result the
company wishes to achieve. So objectives will percolate down from the managers and
will also guide and push the employees in the correct direction.

3] Developing Premises

Planning is always done keeping the future in mind, however, the future is always
uncertain. So in the function of management certain assumptions will have to be made.
These assumptions are the premises. Such assumptions are made in the form of
forecasts, existing plans, past policies, etc.

These planning premises are also of two types – internal and external. External
assumptions deal with factors such as political environment, social environment,
the advancement of technology, competition, government policies, etc. Internal
assumptions deal with policies, availability of resources, quality of management, etc.

These assumptions being made should be uniform across the organization. All managers
should be aware of these premises and should agree with them.

4] Identifying Alternatives

The fourth step of the planning process is to identify the alternatives available to the
managers. There is no one way to achieve the objectives of the firm, there is a multitude
of choices. All of these alternative courses should be identified. There must be options
available to the manager.

Maybe he chooses an innovative alternative hoping for more efficient results. If he does
not want to experiment he will stick to the more routine course of action. The problem
with this step is not finding the alternatives but narrowing them down to a reasonable
amount of choices so all of them can be thoroughly evaluated.

5] Examining Alternate Course of Action

The next step of the planning process is to evaluate and closely examine each of the
alternative plans. Every option will go through an examination where all there pros and
cons will be weighed. The alternative plans need to be evaluated in light of the
organizational objectives.
For example, if it is a financial plan. Then it that case its risk-return evaluation will be
done. Detailed calculation and analysis are done to ensure that the plan is capable of
achieving the objectives in the best and most efficient manner possible.

6] Selecting the Alternative

Finally, we reach the decision making stage of the planning process. Now the best and
most feasible plan will be chosen to be implemented. The ideal plan is the most
profitable one with the least amount of negative consequences and is also adaptable to
dynamic situations.

The choice is obviously based on scientific analysis and mathematical equations. But a
managers intuition and experience should also play a big part in this decision.
Sometimes a few different aspects of different plans are combined to come up with the
one ideal plan.

7] Formulating Supporting Plan

Once you have chosen the plan to be implemented, managers will have to come up with
one or more supporting plans. These secondary plans help with the implementation of
the main plan. For example plans to hire more people, train personnel, expand the office
etc are supporting plans for the main plan of launching a new product. So all these
secondary plans are in fact part of the main plan.

8] Implementation of the Plan

And finally, we come to the last step of the planning process, implementation of the
plan. This is when all the other functions of management come into play and the plan is
put into action to achieve the objectives of the organization. The tools required for such
implementation involve the types of plans- procedures, policies, budgets, rules, standards
etc.

Limitations of Planing We have seen how planning is essential for business organisations. It
is difficult to manage operations without formal planning. It is important for an organisation
to move towards achieving goals. But we have often seen in our daily lives also, that things
do not always go according to plan. Unforeseen events and changes, rise in costs and prices,
environmental changes, government interventions, legal regulations, all affect our business
plans. Plans then need to be modified. If we cannot adhere to our plans, then why do we plan
at all? This is what we need to analyse. The major limitations of planning are given below:

(i) Planning leads to rigidity: In an organisation, a well-defined plan is drawn up with specific
goals to be achieved within a specific time frame. These plans then decide the future course of
action and managers may not be in a position to change it. This kind of rigidity in plans may
create difficulty. Managers need to be given some flexibility to be able to cope with the
changed circumstances. Following a predecided plan, when circumstances have changed, may
not turn out to be in the organisations interest.
(ii) Planning may not work in a dynamic environment: The business environment is dynamic,
nothing is constant. The environment consists of a number of dimensions, economic, political,
physical, legal and social dimensions. The organisation has to constantly adapt itself to
changes. It becomes difficult to accurately assess future trends in the environment if
economic policies are modified or political conditions in the country are not stable or there is
a natural calamity. Competition in the market can also upset financial plans, sales targets may
have to be revised and, accordingly, cash budgets also need to be modified since they are
based on sales figures. Planning cannot foresee everything and thus, there may be obstacles to
effective planning.
(iii) Planning reduces creativity: Planning is an activity which is done by the top management.
Usually the rest of the members just implements these plans. As a consequence, middle
management and other decision makers are neither allowed to deviate from plans nor are they
permitted to act on their own. Thus, much of the initiative or creativity inherent in them also
gets lost or reduced. Most of the time, employees do not even attempt to formulate plans.
They only carry out orders. Thus, planning in a way reduces creativity since people tend to
think along the same lines as others. There is nothing new or innovative.
(iv) Planning involves huge costs: When plans are drawn up huge costs are involved in their
formulation. These may be in terms of time and money for example, checking accuracy of
facts may involve lot of time. Detailed plans require scientific calculations to ascertain facts
and figures. The costs incurred sometimes may not justify the benefits derived from the plans.
There are a number of incidental costs as well, like expenses on boardroom meetings,
discussions with professional experts and preliminary investigations to find out the viability
of the plan.
(v) Planning is a time-consuming process: Sometimes plans to be drawn up take so much of
time that there is not much time left for their implementation.
(vi) Planning does not guarantee success: The success of an enterprise is possible only when
plans are properly drawn up and implemented. Any plan needs to be translated into action or
it becomes meaningless. Managers have a tendency to rely on previously tried and tested
successful plans. It is not always true that just because a plan has worked before it will work
again. Besides, there are so many other unknown factors to be considered. This kind of
complacency and false sense of security may actually lead to failure instead of success.
However, despite its limitations, planning is not a useless exercise. It is a tool to be used with
caution. It provides a base for analysing future courses of action. But, it is not a solution to all
problems.

NAME- SNEHAL
ROLL NO- MBA/10117/20
SUBJECT- ORGANIZATION
MANAGEMENT (MT 401)