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Management/Organizational Theories

Unit # 1
Leadership
Leadership is defined as a social relationship between two or more persons who depend on
each other to attain certain mutual goals in a group situation.

Leadership is the ability of an individual or a group of people to influence and guide followers
or members of an organization, society or team.

Management
Management is the process of planning, organizing, directing, and controlling the activities of
employees in combination with other resources to accomplish organizational objectives.

Management can be defined as a process of getting the work or the task done that is required
for achieving the goals of an organization in an efficient and effective manner.

THEORIES OF MANAGEMENT
Management theories are a collection of ideas that recommend general rules for how to
manage an organization. They address how supervisors implement strategies to accomplish
organizational goals and how they motivate employees to perform at their highest ability.

 Scientific Management Theory

- Frederick Winslow Taylor developed and published his Scientific Management Theory in
1909. Scientific management theory believes that it is vital to find the most effective
way to complete each and every task.

- In the early 1900s, managers would give orders to their workers with no guidance on
how to accomplish them. Managers and employees rarely had interaction with one
another. Taylor believed this was an inefficient way to operate a business and
recommended some key changes.

- Taylor argued each task should be completed as efficiently as possible. In addition,

everyone should be assigned a particular job based on their skills and abilities and must
be evaluated based on the quantity and quality of their work.
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- Taylor did not think it was fair or cost effective to pay every employee the same
amount, regardless of their output. While this may sound like common sense today, this
was a groundbreaking idea in the early 1900s.

- Another big component of scientific management theory is the idea of training and
development. Taylor argued it was extremely important to monitor and train your
employees on the tasks they are assigned to. By ensuring your employees are efficient
at their work, the output will be larger and of a higher quality.

 Administrative Management Theory

Administrative management theory was developed by Henri Fayol in the early 1900s. Henri
Fayol known as the Father of Management laid down the 14 principles of Management. These
14 principles of management are used to manage an organization.

1. Division of Work: Improves productivity, efficiency, accuracy, and speed

2. Equity: Employees should be treated equally and respectfully
3. Discipline: Makes the management job easy and make progress
4. Initiative: support and encourage employees taking initiatives
5. Authority and Responsibility: Efficient delivery of work with defined responsibility
6. Esprit de Corps: Develop trust and mutual understanding
7. Subordination of Individual Interest: Company over personal interest and respect the chain
of command
8. Stability: offer job security to their employees
9. Remuneration: motivating factor linked to the individual’s efforts
10.Unity of Direction: Unified goals and motives for all personnel working in a company
11.Centralization: Balance between the hierarchy and division of power
12.Scalar Chain: Hierarchy steps should be from top to the lowest
13.Unity of Command: More than one boss brings a conflict of interest and confusion
14.Order: the positive atmosphere in the workplace boosts productivity.
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 Bureaucratic Management Theory

- Max Weber created the bureaucratic management theory in 1922.

- This is also known as the bureaucratic theory of management or the Max Weber theory.
- He believed bureaucracy was the most efficient way to set up an administration and
organizations.
- In a bureaucratic organization, everyone is treated equal and the division of labour is
clearly described for each employee.

- Weber's theory of bureaucratic management also has two essential elements.

- First, it entails structuring an organization into a hierarchy.

- Secondly, the organization and its members are governed by clearly defined rational-
legal decision-making rules.
Max Weber’s Six Principles of Bureaucracy

1. Proper Division of Labor

2. Chain of Command
3. Separation of personal and official property
4. Application of Consistent and Complete Rules
5. Selection and Promotion Based on Qualifications
6. Training in job requirements and skills

 Human Relations Management Theory

- Elton Mayo is developed the Human Relations Management theory in 1930s.

- Elton Mayo believed that all early management theories only focused on how money
affects employee performance.

- He believed there were more factors that influenced how employees behaved and
performed at work. To test his theory, he began a study at Chicago’s Western Electric
Hawthorne Plant in the 1920s and 1930s and created his own management theory
based on his findings.
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- The initial goal of the Hawthorne Study was to determine how changing the lighting
would or would not affect employee productivity. They began the study with a small
group of employees who they interacted with throughout the process. The study found
that regardless of how they changed the lighting, productivity increased. When they
were unable to make a connection as to why productivity improved, they began
branching out to other departments to see if the results were similar. They realized that
the lighting changes did not affect productivity but instead the daily interactions with
the employees throughout the process motivated them to work more efficiently and
increase their output.

- They allowed employees to voice their opinions, frustrations, and successes which in
turn helped the employees feel more valuable. In addition, since they knew they were
being monitored, they were more motivated to perform on a higher level.

 Systems Management Theory/General Systems Theory

- The system theory of organization was introduced Ludwig von Bertalanffy in 1950. His
work challenged approaches and advocated for a holistic perspective that recognizes
the interrelationships within a system.
- The theory gained popularity in management and organization. It emphasized that
organizations are dynamic systems comprised of interconnected subsystems.
Components of System Theory of Management
The system theory of management can also be studied on the basis of its components. System
theory’s main components include the followings:
o Environment
The environment refers to the setting in which an organization operates. It includes the
external factors, such as the market, resources, and relationships, that impact the
organization’s functioning.
o Inputs
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Inputs are the resources an organization needs to carry out its operations. These include raw
materials, human resources, money, information, and technology. Inputs are obtained from
the environment and are essential for the organization to function effectively.
o Process
The process involves the transformation of inputs into outputs. It includes activities such as
employee work, management tasks, and operational methods. Proper planning, decision-
making, leadership, and control are important for a smooth and efficient process.
o Outputs
Outputs are the final products or services that an organization produces. These can be tangible
goods, financial results, information, or human outcomes. The quality of outputs affects how
customers perceive the organization and can influence its success in the market.
o Feedback
Feedback is the information an organization receives from both internal and external sources.
It helps the organization evaluate its performance and make necessary adjustments. Feedback
can influence future inputs and improve the overall functioning of the organization

 Contingency Management Theory

First contingency theory was developed by Austrian psychologist Fred E. Fiedler in the
1960s.The main concept behind the contingency management theory is that no one
management approach suits every organization. There are several external and internal
factors that will ultimately affect the chosen management approach. The contingency theory
identifies three variables that are likely to influence an organization’s structure: the size of an
organization, technology being employed, and style of leadership.

Fred Fiedler is the theorist behind the contingency management theory. Fiedler proposed that
the traits of a leader were directly related to how effectively he led. According to Fiedler’s
theory, there’s a set of leadership traits handy for every kind of situation. It means that a
leader must be flexible enough to adapt to the changing environment. The contingency
management theory can be summed up as follows:

 There is no one specific technique for managing an organization.

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 A leader should be quick to identify the particular management style suitable for a
particular situation.
 The primary component of Fiedler’s contingency theory is LPC – the least preferred co-
worker scale. LPC is used to assess how well oriented a manager is.
Health care organizations

A health care organization is a purposefully designed, structured social system developed for
the delivery of health care services by specialized workforces to defined communities or
populations.

Healthcare organizations come in many shapes and sizes, and each type of organization has its
own unique purpose. From hospitals to clinics to home health care providers, there are a
variety of healthcare organizations that provide different services to patients.
Classification of health care organizations
Types of Health Care Organizations An understanding of the various health care agencies and
their services could help the nurse manager to perform and assume his/her role effectively.
Health care agency is considered as a setting for providing health care services (e.g. curative,
preventive, and/or educational) to the society whether in clinics; homes; ambulatory care
settings; and hospitals.
Types of Health Care Organizations

Classification according to length of stay:

1. Sort-stay facilities:

 Which provide services to patients/clients who are suffering from acute conditions that
require less than 24 hrs of care.
 Short stay may take place in separate units in a hospital, or in short –stay centers.
2. Long term care
 That offering services to patients with major rehabilitation needs, chronic diseases,
functional losses, or mental illness. The length of stay several months to years.
Classification by type of service
1. General hospital:
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 Offers medical, surgical, Obstetric, emergency, diagnostic as well as laboratory services.

2. Specialty hospital:
 Which offers only a particular type of care such as
- psychiatric hospitals
- Cancer's hospitals
- children's hospitals
 Specialty hospitals tend to be less common than general hospitals
3. Community hospital:
 Which provides those services provided in the general hospital but for specific
community.
4. Tertiary hospital:
 Which are serving as referral centers for clients with complex or unusual problems.
 They have the facilities for specialized types of care such as burn centers, bone marrow
transplant centers, as well as resources for general care.
 They serve a wide geographic area in addition to their own community.

 Usually associated with a university or is a part of a large medical center.

5. In-home services

Which are provided in the community health care agencies, by health care professional

including nurses, physical therapists, social workers, and home health care aid.

This care may be:

1) Short–term: teaching and monitoring after hospitalization.

2) Intermediate-term: to assist an individual until self-care is possible.

3) Long-term: for those with ongoing health problems.

Classification by ownership
1. Governmental Organizations:
• Owned, administered, and controlled by government.
• Provide free care for patients.
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• May offer private accommodation for free-paying patient.

The governmental hospitals are owned by:
a- The Ministry of Health
b- The University
c- Health insurance organization
d- Health care organization
2. Non-Governmental Organizations: For-profit agencies (PRIVATE):
 Owned, operated, and controlled by individuals, groups, or private organizations.
3. Non-for-profit agencies (Voluntary health agencies):
● Owned and operated by non-profit groups or organizations (e.g. religious bodies &
community boards).
● The original capital costs are obtained in a variety of ways (e.g. through donation).
What is organizational structure
Organizational structure is the systematic arrangement of human resources in an organization
so as to achieve common business objectives. It outlines the roles and responsibilities of every
member of the organization so that work and information flow seamlessly, ensuring the
smooth functioning of an organization.
Types of organizational structures
The seven common types of organizational structures to help you decide how you want to
develop your organization and its various departments and teams.

1. Functional structure
2. Divisional structure
3. Simple structure
4. Boundary less structure
5. Matrix structure
6. Team structure
7. Project based structure
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1. Functional structure
 A functional structure groups employees into different departments by work
specialization. Each department has a designated leader highly experienced in the job
functions of each employee supervised by them. Organization is divided into smaller

groups based on specialized functional areas.

2. Divisional structure

 Divisional structure typically is used in larger companies that operate in a wide

geographic area or that have separate smaller organizations within the umbrella group
to cover different types of products or market areas.
 Each division can have its own marketing team, sales team, IT team, etc.

 An organizational structure made up of separate business units or division.

 Division manager has authority over his/her unit and responsible for performance.
2. Simple structure
 An organizational design with low departmentalization, wide span of control, centralized
authority and little formalization.
 However most companies don’t remain simple structure, tend to become more
specialized and formalized.
3. Boundary less structure
 Boundary less organizations are defined specifically by a lack of structures, includes
virtual and network types organization (organization consists of temporary hired
people). Utilize talent wherever it’s found, lack of control.
4. Matrix structure
 Within a matrix organizational structure that assign specialist from different department
or functional area to work on project but return back to their area when project is
completed.
 Having multiple supervisors allows for company-wide interaction and faster project
delivery. For instance, when answering to functional managers and project managers,
employees have a chance to collect experience outside their team. While functional
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managers can help to solve job-specific issues, project managers can bring in knowledge
or talents from other departments.
5. Team structure
 A team-based organizational structure creates small teams that focus on delivering one
product or service.
 They are less hierarchical and they have flexible structures that reinforced, problems –
solving, decision making and teamwork.
 No clear chain of command, pressure on team to perform.
6. Project based structure
 A project organization is a structure that facilitates the coordination and
implementation of project activities.
 Dedicated teams are put together to work on projects in a project organizational
structure.

 The individuals on the team work directly for the project manager.

DIFFERENCES BETWEEN FORMAL AND INFORMAL ORGANIZATION

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Functions of nurse manager/Management Process

It is the process of working through Nursing Personnel to promote and maintain health,
prevent illness and suffering. The role of Nurse Manager is to plan, organize, direct and control
available resources in order to provide effective care to groups of clients efficiently.

Success of management depends on learning and using the management functions. These
functions include planning, organizing, staffing, directing, coordinating and controlling.

 Planning
 Organizing
 Staffing
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 Directing
 Coordinating/Controlling

1. Planning

Planning is the process of setting goals and creating steps you can follow to achieve those
goals.

Planning is a technical managerial function that enables organizations to deal with the present
and anticipate the future. It is the first and fundamental function of management because all
other management functions are dependent on it. Planning is deciding what is to be done,
when it is to be done, how it is to be done and who is to do it.

2. Organizing

Organizing may be defined as the arranging of component parts into functioning wholes. The
purpose of organizing is to coordinate activities so that a goal can be achieved. The manager
has been advised to arrange for all the necessary resources i.e. raw materials, monetary
resources, human resources, and technology as well as the managerial expertise to help
achieve the goals set under planning process. Organizing is the function of management which
follows planning.

There are six steps in the organizing process:

1. Establish overall objectives
2. Formulate supporting objectives, policies and plans
3. Identify and classify activities necessary to accomplish the objectives
4. Group the activities in light of the human and material resources available and the best way of
using them under the circumstances
5. Delegate to the head of each group and the authorities necessary to perform the activities
6. Tie the groups together horizontally and vertically, through authority relationships, and
information systems.

3. Staffing
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Staffing function is the most important managerial act along with planning, organizing,
directing and controlling. The operations of these four functions depend upon the manpower
which is available through staffing function. Staffing involves manning the organization structure
through proper and effective selection, appraisal and development of the personnel to fill the
roles assigned to the employers/workforce. Staffing involves:

 Manpower Planning (estimating man power in terms of searching, choose the person
and giving the right place).
 Recruitment, selection & placement.
 Training & development.
 Remuneration.
 Performance appraisal.
 Promotions & transfer.
4. Directing

Directing is said to be a process in which the managers instruct, guide and oversee the
performance of the workers to achieve predetermined goals.

Direction has following elements:

 Supervision
 Motivation
 Leadership
 Communication
5. Coordinating/ Controlling

It is an ongoing process to ensure that the activities of an institution or organization adhere to

the plan.

Controlling ensures that there is effective and efficient utilization of organizational resources
so as to achieve the planned goals. It is a hidden force which binds all the other functions of
management.
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Controlling is the measurement & correction of performance activities of subordinates in order

to make sure that the enterprise objectives and plans desired to obtain them as
being accomplished”. Therefore controlling has following steps:

 Establishment of standard performance.

 Measurement of actual performance.
 Comparison of actual performance with the standards and finding out deviation if any.
 Corrective action.

strategic planning
Strategic planning is a process used by organizations to identify their goals, the strategies
necessary to accomplish those goals and the internal performance management system used
to monitor and evaluate progress.
Types of Strategic Planning
There are three main types of strategic planning:
1. Annual planning
Annual planning is a process that takes place over one year. It involves setting goals and
objectives for the year and developing strategies to achieve those goals.
2. Rolling planning
Rolling planning involves setting goals and objectives on a rolling basis and developing
strategies to achieve those goals.
Rolling planning is best suited for businesses in a growth phase or an unpredictable sales cycle.
3. Crisis planning
Crisis planning is a process in response to a specific crisis.
It involves developing a plan to address the crisis and implementing that plan.
In addition to these, there are specific strategic planning models that you can adopt while
approaching your strategic plan.
Attributes of effective nurse manager

Nurse Managers are responsible for retaining, recruiting, and supervising nurses. It is also their
job to ensure that nurses operate in an optimal work environment. It is an incredibly
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demanding position that requires balancing managerial duties with clinical responsibilities.
Below are the key traits that a nursing manager must not lack.

 Communications Skills

 Leadership Skills

 Compassionate

 Self-Awareness and Self-Assessment

 Organizational Skills

1. Communications Skills
A successful nurse manager is one with the ability to communicate concisely. They should
keep in mind that effective communication involves not only speaking but listening. Thus, they
listen to the concerns of the junior nurses and try to understand their differences when
delegating duties.

They must be able to create a good rapport with the hospital administrators, physicians, and
other staff so as to ensure the smooth running of the day to day operation.

2. Leadership Skills
They should be allowed to do their jobs without feeling intimidated or insecure. Great
managers support the nurses and encourage them to achieve their potential.

Successful managers should stand their ground and take the lead on policy changes in order to
ensure that the nurses under them conform to the accepted norms and the hospital provides a
suitable environment for them to do so.

3. Compassionate
Compassion is an essential trait for any nurse, and a great nurse manager should exhibit more
of it than the average nurse. Most nurses will try to emulate what they see their manager
doing. If empathy is seen in their mannerism as well as their words, nurses will respond by
providing maximum care for their patients and going about their duties with minimum fuss.
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If the manager lacks empathy for the patients, then the other nurses will feel that it is okay to
let them suffer. Eliciting kindness and care from nurses and other staff will not only benefit the
patients but the hospital’s reputation too.

4. Self-Awareness and Self-Assessment

On top of awareness of others’ feelings, great managers are aware of their own. They should
acknowledge the stress that comes with their work situations and seek help when the
outcomes are challenging. They should accept that even the most powerful people need
advice and support when facing crises or unfortunate situations.

5. Organizational Skills
Great nurse managers are able to work in coordination with other departments. They must
also possess the ability to oversee an array of practice functions including staff supervision,
clinical tasks, and appointments. Great interpersonal skills come in handy here because they
provide for effective collaboration at every level.