CONCEPT OF MANAGEMENT THEORIES

MANAGEMENT THEORIES: Management theories are a collection of ideas that recommend

general rules for how to manage an organization or business. Management theories address how
supervisors implement strategies to accomplish organizational goals and how they motivate employees to
perform at their highest ability. Management theories are concepts surrounding recommended
management strategies, which may include tools such as frameworks and guidelines that can be
implemented in modern organizations. Depending on a company's goals and the industry.

Management theories are the set of general rules that guide the managers to manage an organization.
Management theories (also known as "Transactional theories") focus on the role of supervision,
organization, and group performance. Theories are an explanation to assist employees to effectively relate
to the business goals and implement effective means to achieve the same. In this article, we will discuss
the historical context of management, diverse views on management, and finally the theories of
management.

Example: Most common example is Henri Fayol management principal help to provide guideline for
managerial decision i.e. division of labour, unity of command etc
WHY STUDY MANAGEMENT THEORY?

 Increased productivity: Using these theories, leaders, administrator learn how to make

the most of their team members, improving performances and increasing productivity.

 The effectiveness of a hospital or other health care facility is dependent upon the type
of health care management theory it subscribes to and how well that theory is
implemented.
 Simplified decision-making: Management theories give leaders or administrator
strategies that speed up the decision-making process, helping those them be more effective
in their roles. Theories Make it possible-indeed, challenge us-to keep learning about our
world provide and sound basis for predicting future events.
 Increased collaboration: Leaders or administrator learn how to encourage team member
participation and increase collaboration in the workplace.
 Increased objectivity: Management theories encourage leaders/administrator to make
scientifically proven changes rather than relying on their judgment.
Example : Mc gregor gave theory of motivation
Theory X – people dislike work, have little ambition, and are unwilling to take
responsibility. What administrator/manager do? He motivate their people using a rigid
"carrot and stick" approach, which rewards good performance and punishes poor performance.
Theory Y assumes that employees are happy to work, are creative, and enjoy taking on
additional duties. What administrator/manager do? He involve their employees in the
decision-making process, suppose administrator may ask the staff to help interview a new
candidate that has just applied for a job.
DEVELOPMENT OF MANAGEMRNT THEORY

Although many management theories were created centuries ago, they still provide many
beneficial frameworks for leading teams in the workplace and running businesses today.

1) Pre Classical Contribution (Pre Modern Era)

a) Pyramid and wall (500-5000 years ago)
b) Adam smith contribution
c) Industrial revolutions influence on management practices

b)Adam smith contribution

Adam Smith (1723-1790) was visionary of social system builder, father of economics and also
pioneer management theorist. His two master works, The theory of model sentiments (TMS) and
enquiry into the nature and cause of wealth of nation (WN) were published in 1759, and 1776,
respectively during the early stages of Britain process of industrialization. His ideas had great
impact in his own time and continue to be relevant to such current issues as trade protection and
industrial policy and also to a business management.

Smith believed that economic growth directed by functioning market system and facilitated by
appropriate government institutions was the key to a nation’s wealth and well-being of the
citizens . Because growth was dependent on effective employment of productive resources.
Smith saw that management play a very crucial role and therefore he analyzed management
concept at length.

Adam Smith was the first person to identify specialization and the division of labor as the main
drivers of productivity. He also conceptualized the “invisible hand principle”( competition and
self interest act that regulates the market) which explains how, under the proper set of incentives,
self‐interested individuals are directed to pursue activities that benefit the whole of society. Both
ideas are of utmost importance in the field of management. Specifically, successful managers are
those who are able to create good “rules of the game” which align the incentives of labor with
the goals of the firm.

Key Point:

 Breakdown of jobs into narrow and repetitive task increase productivity

 Division of labour

Example: Nurse Administrator appoints OT nurses into Operation Theater according to their
experience improve result and efficacy.

c)Industrial revolutions influence on management practices

The Industrial Revolution is at the center of management theory. From the late 1700s through the
early 1900s, the Industrial Revolution brought extraordinary change to the workplace and forever
transformed the way companies operate. The Industrial Revolution brought better and faster
technology allowing companies to perform more efficiently than ever before and gave them the
ability to dramatically increase their output.
The Industrial Revolution is changing the way health is understood, transforming the methods of
treatment and diagnosis as well as the relationship between health professionals and patients and
altering the management and organization of health systems.
The Industrial Revolution gave birth to a variety of management theories and concepts, many of
which are still relevant and essential in today’s workforce. In addition, many management
theories have developed since the end of the Industrial Revolution as society continues to
evolve. Each management theory plays a role in modern management theory and how it is
implemented.
Key Point:

 Substitution of machine power for human power

 Large organization require formal management
Example???: Without management the substitution of machine power fir human power is
possible without formal management should be there.
Robert owen (1771-1858): He was an early industrialist. He is perhaps best known for his model
textile factory and village at New Lanark in Scotland. A successful British entrepreneur was well
ahead of his time in recognizing the importance of human resources (recruitment, employee
hiring his training, his performance). He became particularly interested in the working and living
conditions of his employee. He was first attempted through those of influence who visited New
Lanark, and then in 1815, via his attempt to introduce a Bill to legislate on working conditions in
factories.
The aim of the Bill was to:

 Ban the employment of those under 10.

 Ban night shifts for all children.
 Provide 30 minutes education a day for those under 18
 Limit the working 10 or 12 hours.

This would have been enforced by a system of government factory inspectors. The Bill failed to
be introduced in its intended form, as its opponents argued that it would be bad for business and
that in any case most employers were voluntarily doing what the bill would require. By the time
it was finally introduced in 1819 the legislation was limited to banning the employment of those
under nine.

Charles Babage (1792-1871): An English mathematician is widely known as the father of

modern computing, built first mechanical calculator and give ideas of specialization, costing,
incentives and profit sharing plan,. Babbage believed in the benefits of division of labor and
was an advocate of profit sharing. He developed a method of observing manufacturing that is the
same approach utilized today by operations analysts( current performance of the business) and
consultants analyzing manufacturing operations( focus on quality, increase performance, reduce
cost). But they don’t see management as separate field.
Henery R Town (1844-1924): He was mechanical engineer and businessman and known as
early systematizer of management. He called for the establishment of management as a science
and the development of the principal that could be applied across management situation. And
also known for creating modern system of scientific management (clear division of task and
responsibilities, high pay for high performing employee) He articulated that there is a need to
consider management as separate field of knowlegde.
He Founded famous New Lenark Mills in Scotland, He was one of the foremost management
thinker during industrial revolution well before the advent of scientific management school, Can
be call world’s first enlighten ( and first personnel) manager and father of corporate movement
(environment friendly corporate policy) . He also established the Grand National consolidation
Trade union in 1834.

 He Stopped children below 10 in factories.

 Reduce working Hour 14-10.
  Built houses for worker with proper sanitization
 Nursery for children,
 Showed higher wages increases profit through higher productivity, unique incentive
scheme.
 Inform worker participation in management
“In 1886 at the meeting of American Society of mechanical Engineers, Town read his Landmark
paper titled with the engineer as an economist in it he called for the recognition of management
work as similar to engineering”. The presentation was attended by Frederick Taylor known
as the father of scientific management.
Key Point:

 There is need to consider management as a seperate field of knowledge.

 His writing has influenced Henry Fyol’s Contributions to the theory of management.

ARTICLE

Health Management Education in India: Past, Present, and Future

This article provides a perspective on the evolution of health management education in India, its
current state and the way forward. Health management originated in India in response to the
administrative needs of the healthcare system, which is now moving toward institutional care,
away from its earlier form of home healthcare. As this field evolved over time, new roles
emerged for health management professionals. Several articles have been published in the past
describing the state and growth in the field of health management education. This article
emphasizes the need to rationalize the sector and shape its future to suit the needs of over a
billion people, who use the services of multiple organizations, directly or indirectly in a highly
dynamic healthcare environment. We have identified the various challenges that affect the sector
today; filling vacant positions, matching jobs with training, and changes in curricula required to
achieve good matches. Solutions to address these challenges have also been considered, which in
our view could be a way forward in this sector.

ASK QUESTION?????????????????????????????????????
In addition to advances in technology, ________ was a large motivation in the development of
management theory during the industrial revolution.

a) Productivity
b) Sustainability
c) Industry Regulation
d) Turnover

Write answer (a)