St.

Louise De Marillac College of Sorsogon

Higher Education Department
Sorsogon City
Summer 2020-21

Program: Master in Business Administration Course: PRINCIPLES and THEORIES of BUSINESS

MANAGEMENT

Instructor: Araceli Demdam Belason

Module II

Topics: 1. The Search for Principles of Management

1.1 Fayol’s definition of management

1.2 FW Taylor and Scientific Management
1.3 Henry Gantt Ideas
1.4 LF Urwick
1.5 EFL Brech
1.6 Max Weber and the Idea of Bureaucracy
1.7 Bureaucracy after Weber

2. Motivation: The Early Theorists

2.1 The concept of Motivation

2.2 Maslow’s Hierarchy of Needs

2.4 Rensis Likert

2.5 Chris Argyris

2.6 Achievement Motivation

3. Motivation: Later Theorists

 3.1 Expectancy Theory

3.2 Equity Theory

3.3 Goal Theory

3.4 Attribution Theory

3.5 Reinforcement Theory

3.6 The Japanese Approach

Objectives: 1. To familiarize the different principles of management.

2. To evaluate the different contributions of the early and later theorists

to the students understanding of organizations.

1. ELICIT. In this module you will be acquainted with the different ideas of popular theorists about management. They have their own
definitions based from their experiences, trainings, observations, formal studies and schooling, from their mistakes and coming from
the advice of other people. All of these are recognized by the theorists as support to their ideas in order to discover fruitful research
on effective organization. People must enhance their knowledge and skills of managing people since management aside from it is a
science, it is an art. Although there are sayings that there are people who are born good leaders, but most of the time this is not true,
because leadership, for it to be successful should be theorized, practiced and developed.
2. ENGAGE. What are the different character traits that a person must possess in order to be a good leader and manager? Please read
and research on this topic. Write your answers on a separate sheet.
3. EXPLORE: LESSON I. FAYOL’S DEFINITIONS OF MANAGEMENT:
Considered as the key activities of any industrial undertakings:
a. Technical activities, ex. Production
b. Commercial activities, ex. buying and selling
c. Financial, activities, ex. securing capital
d. Security activities, ex. safeguarding property
e. Managerial activities, ex. planning and organizing
f. Accounting activities, ex. providing financial information
To manage according to Fayol, is to forecast and plan, to organize, to command, to coordinate, and to control.
Fayol’s Principles of management:
 1. Division of work- reduces the span of attention or effort for any one person or group. Develop practice and familiarity.
2. Authority- the right to give orders, should not be considered without reference to responsibility.
3. Discipline- outward marks of respect in accordance with formal and informal agreements between firms and its employees.
4. Unity of command- One man one superior.
5. Unity of Direction-One head and one plan for a group of activities with the same objective.
6. Subordination of individual interests to the general interest. The interest of one individual or one group should not prevail
over the general good.
7. Remuneration- pay should be fair to both the employee and the firm.
8. Centralization- is always present to a greater or lesser extent, depending on the size of the company quality of its managers.
9. Scalar chain-the line of authority from top to bottom of the organization.
10. Order- a place for everything in its place; the right to man in the right place.
11. Equity- a combination of kindliness and justice towards employees.
12. Stability of tenure of personnel-employees need to be given time to settle into their jobs, even though this may be a lengthy
period in the case of managers.
13. Initiative- within the limits of authority and discipline, all levels of staff should be encouraged to show initiative.
14. Esprit de corps- harmony is a great strength to an organization; teamwork should be encouraged.

The principles of Scientific Management by Taylor:

The scientific approach required the following steps:

1. Develop a science for each operation to replace opinion and rule-of- thumb.
2. Determine accurately from the science the correct time and method for each job.
3. Set up a suitable organization to take all responsibility from the workers except that of actual job performance.
4. Select and train the workers.
5. Accept that management itself be governed by the science developed for each operation and surrender its arbitrary power
over worker ex. cooperate with them.

The Principles of Management after Taylor:

The three important followers: Frank and Lilian Gilbreth; Henry Gantt

Measurement was their byword. This idea is all about applying measurements to management and of abiding by the results. Systematic rules
and procedures for the efficient operation of work. Gilbreths used ‘therbligs’ and process charting for recording techniques for on- the- job
motions. It provides a standardized basis for recording movements. They include such items as: search, find, grasp, assemble, and inspect. A few
Items cover periods when no motion may be in evidence such as: wait-unavoidable, rest and plan. Process flowchart were devised to enable
whole operations or processes to be analyzed.

Henry Gantt- He is remembered by the famous Gantt chart. Gantt chart was originally set up to indicate graphically the extent to which tasks
had been achieved. It was horizontally into hours, day or weeks with the task marked out in a straight line across the appropriate number of
hours or days etc. The amount of the tasks achieved was shown by another straight line parallel to original. This to assess actual from planned
performance.

L F Urwick – the ten principles of Urwick are:

1. The Principle of objective

2. The Principle of Specialization
3. The Principle of Coordination
4. The Principle of Authority
5. The Principle of Responsibility
6. The Principle of Definition
7. The Principle of Correspondence
8. The Span of Control
9. The Principle of Balance
10. The Principle of Continuity

EFL Brech wrote widely on management and organization issues. He is concerned on the development of Principles, or general laws of
management affairs. He was also concerned on the development of people. He saw management as a process, social process, for planning and
regulating the operations of the enterprise toward some agreed objectives and carried out within the framework of the organization structure.

Key issues for Brech in the formation of the structure were:

. Defining the responsibilities of the management, supervisory and specialist staff.

. Determining how these responsibilities are to be delegated.

. Coordinating the execution of responsibilities.

. Maintaining high morale

MAX Weber and the idea of Bureaucracy

Weber was an academic—a sociologist—and not a practicing manager. His interest in organizations was to find why people in
organizations obeyed those in authority over them. In his analysis, Weber identified three basic type of legitimate authority. Traditional,
charismatic, and rational- legal authority.

Traditional authority- where acceptance of those in authority arises from tradition and custom ex. as in monarchies, tribal hierarchies,
etc).

Charismatic Authority- where acceptance arises from loyalty to, and confidence in, the personal qualities of the owner.

Rational-Legal authority where acceptance arises out of the office, or position, of the person in authority, as bounded by the rules and
procedures of the organization.

The main procedure of bureaucracy, according to Weber are as follows:

1. A continuous organization of functions bound by rules.

2. Specified fear of competence, ex. the specialization of work, the degree of authority allocated and the rules governing the exercise of
authority.
3. A hierarchical arrangement of offices (jobs), ex. where one level of jobs is subject to control by the next higher level.
4. Appointment to offices are made on grounds of cultural competence.
5. The separations of officials from the ownership of the organization.
6. Official positions exist in their own right, and job holders have no rights to a particular position.
7. Rules, decisions and actions are formulated and recorded in writing.

Bureaucracy after Weber

During the time of Weber, Bureaucracy was the most efficient means of organizations for the achievement of a formal goals, but
weaknesses could not be avoided in this system like:

1. Rules originally designed to serve organization efficiency, have a tendency to become all-important in their own right.
2. Relationships between office-holders or roles are based on the rights and duties of each role, ex., they are depersonalized, and this leads
to right behavior.
3. Decision- making tend to be categorized, ex. choices are previously programmed and this discourages the search for further initiatives,
another from form of rigidity.
4. The effects of rigid behavior are often very damaging for client or customer relations and also for management- worker relationships;
 Customers are unable to obtain tailor-made services, but have to accept standardization: employees have to work within a framework
Of rules and controls which has been more or less imposed on them.
5. Standardization and routine procedures make change and adaptation difficult when circumstance change.
6. The exercise of ‘control based on knowledge’ as developed by Weber, has led to the growth of experts, whose opinions and attitudes
may frequently clash with those of the generalist managers and supervisors.

ACTIVITY I. Answer the following questions:

1. What difficulties might confront a manager today, if he or she tried to implement Fayol’s principles of management as they were
originally stated?
2. What common features do you see between Fayol’s principles of management and Weber’s description of bureaucracy?
3. How would you summarize the principal effects of scientific management on (a) managers, and (b) employees?
4. Why is it difficult to implement principles of management along the lines suggested by Fayol, Urwick and Brech, for example?
5. Discuss the main advantage and disadvantages of the ideal-type of bureaucracy, as described by Weber.

IV. EXPLAIN

To answer the foregoing five questions, please read further other books or visit any websites that will give you additional information as
supplement for your understanding of the topics. For the topic, motivation (early and later theorists) this is an assignment for you to surf the
internet to be able to answer the questions. In answering the questions use your own words and avoid copy paste. All answers must be encoded
to facilitate checking. A clean sheet of paper will be provided for the answer sheet.

V. ELABORATE:

The following questions are coming from the topic, MOTIVATION (early and later theorists):

1. What are the needs or motives most frequently referred to by the leading theorists of human relations? In what ways is it possible to
group these needs?
2. Give examples of tangibles and intangible goals and suggest how a person might seek to achieve them?
3. What is the ‘Hawthorne Effect’? What are the implication of this for those undertaking research into human behavior in the workplace?
4. Why were the Hawthorne Studies considered to be an important in their time?
5. In what way has Maslow’s concept of self- actualization been taking up by other theorists?
6. What are the essential differences between motivators and hygiene factors in Herzberg’s theory
of motivation?
7. How can an understanding of the need for an achievement be of use to managers in industry and commerce?
 8. In what ways can human beings contrive to come to terms with a work situation that appears not to be satisfactory to them?

VI. EVALUATE:

1. Critically evaluate the contribution of the classical/traditional school of management theorists to our understanding of motivation?
2. Does the work of F.W. Taylor have any relevance to modern marketing Management?
3. Compare the approaches taken by the classical/ traditional theorists with the human relations / resources theorists, in understanding
the nature of organizations.
4. ‘People only come to work for money’. Discuss.
5. Motivation of subordinates is an important aspect of manager’s job.
(a)What do you think motivates a person to work well?
(b) What steps can a manager take to motivate his subordinates?

VII. Your assignment is to study Leadership: Theory and Practice; Group and Group Behavior; Types of Business Organization