✅ Classical Management Theory – Explained Simply:

📌 Definition:

Classical Management Theory is one of the oldest approaches to management that focuses on:

Efficiency, productivity, and formal structure of an organization.

It assumes that workers are mainly motivated by money, and it emphasizes clear roles, rules,
and hierarchy.

📚 Key Characteristics:

1. Clear Division of Labor

→ Every worker has a specific task or role.
2. Organizational Hierarchy
→ Clear chain of command (top to bottom).
3. Standardized Procedures
→ Everyone follows fixed rules and procedures.
4. Focus on Efficiency
→ Managers look for the “one best way” to do a job.

👨‍🏫 Main Thinkers (Founders):

Name Contribution
Frederick W. Taylor Scientific Management – time studies, productivity
Henri Fayol Administrative Management – 14 principles of management
Max Weber Bureaucratic Management – rules, hierarchy, authority

💡 Example in Real Life:

Imagine a factory:

 Each worker performs a single task (division of labor)

 A supervisor oversees 10 workers (hierarchy)
 There’s a rulebook for every operation (standardization)

This is Classical Management in action—structured, rule-based, and efficiency-driven.

✅ Advantages:

 Increases efficiency
 Defines clear roles
 Strong managerial control
 Suitable for large organizations

❌ Disadvantages:

 Ignores human/social needs

 Treats employees like machines
 Not flexible in dynamic environments
 Poor for innovation or teamwork-based settings

🔁 Conclusion:

Classical Management Theory laid the foundation of modern management, especially for
structured, industrial work. However, it’s too rigid for modern, creative, or service-based
organizations.

 Strength: Efficiency and predictability.

 Limitation: Inflexibility, discourages creativity.

Bureaucratic Theory of Management – Max Weber

✅ Definition:

Max Weber’s Bureaucratic Theory describes a formal system of organization and

administration designed to ensure efficiency, order, and rationality in large organizations.

He believed that a structured, rule-based system was the most effective way to manage
complex organizations.
🧠 Key Features of Bureaucracy According to Max Weber:
Feature Explanation

A clear chain of command from top to bottom. Each level controls the level
1. Hierarchical Structure
below.

2. Division of Labor Work is divided into specialized roles and tasks for efficiency.

3. Formal Rules &

All decisions and actions follow set rules and policies.
Procedures

4. Impersonality Decisions are made without favoritism or personal feelings.

5. Merit-Based Employment Hiring and promotion are based on qualifications and performance.

6. Written Documentation Records and communications are maintained in writing for accountability.

📌 Real-Life Example:

Government departments, police forces, military, educational boards, and corporate

headquarters often use bureaucratic models.

For example:

In a government office, every employee has a specific role, follows strict procedures, and reports
to a supervisor. Hiring is done through exams or merit. This is bureaucracy.

✅ Advantages:

 Clear authority & responsibility

 Consistency and stability
 Reduces favoritism (impersonality)
 Efficiency through specialization

❌ Disadvantages:

 Rigid and inflexible

(Hard to adapt to change or innovation)
 Too much red tape
(Excessive paperwork and slow decision-making)
  Demotivating for employees
(Less creativity, more routine)

🧾 Summary in One Line:

Max Weber’s Bureaucratic Theory is all about structured control, clear rules, and formal
processes to manage large organizations effectively.

📘 Administrative Management Theory – Henri Fayol

✅ Definition:

Henri Fayol’s Administrative Management Theory focuses on the management process itself
and the functions of managers. He believed that management is a universal process that can
be applied in any organization.

He emphasized how managers should organize and interact with staff to run an efficient
organization.

👨‍🏫 Henri Fayol’s 14 Principles of Management:

Principle Meaning
1. Division of Work Specialization increases efficiency and output.
Managers must have the power to give orders and expect
2. Authority
obedience.
3. Discipline Respect for rules and agreements.
4. Unity of Command Employees should receive orders from only one manager.
5. Unity of Direction All efforts must be directed toward the same objective.
6. Subordination of Individual
Organization’s interest > personal interest.
Interest
7. Remuneration Fair payment for work done.
8. Centralization The degree to which authority is concentrated at the top.
Clear line of authority from top to bottom (chain of
9. Scalar Chain
command).
Everything and everyone should be in the right place at the
10. Order
right time.
11. Equity Kindness and fairness to all employees.
Principle Meaning
12. Stability of Tenure Job security and long-term employment create efficiency.
13. Initiative Allow employees to show creativity and take action.
14. Esprit de Corps Teamwork and unity = Strength.

🧠 Fayol’s 5 Functions of Management:

Function Explanation
1. Planning Setting goals and deciding how to achieve them.
2. Organizing Arranging people and resources.
3. Commanding Giving orders and guiding subordinates.
4. Coordinating Ensuring all departments work together harmoniously.
5. Controlling Monitoring performance and making corrections if needed.

📌 Real-Life Example:

In any well-run company:

 A manager plans projects, organizes teams, gives orders, checks work, and ensures goals
are met — this reflects Fayol’s model.

✅ Advantages:

 Universal principles for all types of organizations

 Provides structure to managerial tasks
 Focus on both efficiency and human behavior

❌ Disadvantages:

 Too focused on hierarchy and control

 May not adapt well in fast-changing or creative industries
 Lacks attention to worker motivation (unlike Human Relations theory)

🧾 Summary in One Line:

Henri Fayol’s theory is about what managers do and how they can manage efficiently using
clear functions and principles.

Here’s a clear comparison between Public and Private Management, along with how these
differences affect organizational design and behavior:

🏛️Public vs. Private Management

Aspect Public Management Private Management
Profit maximization, market
🎯 Goals/Objectives Public interest, social welfare, equity
competitiveness
📊 Performance Service quality, citizen satisfaction, Profit, ROI, market share,
Measure policy success customer satisfaction
To public, government, media, courts To owners, shareholders, and
📋 Accountability
(multi-stakeholder) investors
Taxes, government budget, public Private investment,
💰 Funding Source
donations product/service sales
Stakeholders Politicians, citizens, public agencies Owners, employees, customers
Bureaucratic, influenced by laws and Flexible, market-driven, manager-
⚙️Decision-Making
politics centric
⏳ Response to Slower due to legal and political
Faster, driven by market trends
Change constraints
📑 Rules & Strict, detailed, legally required Internal policies, industry
Regulations processes regulations
🧭 Risk Orientation Risk-averse (due to public scrutiny) Risk-taking (entrepreneurial)
🏫 Employee Public service, job stability, social Monetary incentives, growth
Motivation contribution opportunities

🔄 Implications for Organizational Design:

Public Sector Private Sector

Tall hierarchy (bureaucratic structure) Flatter, more dynamic structures
Emphasis on innovation, speed, and
Emphasis on rules, procedures, and compliance
adaptability
Centralized control by government or ministries Decentralized control with managerial freedom
Focus on accountability, ethics, and
Focus on results, performance, and efficiency
transparency

👥 Implications for Organizational Behavior:

Public Sector Behavior Private Sector Behavior
Employees may show commitment to public Employees are more profit and performance-
values focused
Motivation comes from extrinsic factors
Motivation comes from intrinsic factors (duty)
(bonuses)
More unionization and legal protections More performance-based contracts
Greater resistance to change More openness to innovation

🧾 Summary:

Public management is about serving society, following legal standards, and promoting fairness.
Private management is about maximizing profits, pleasing customers, and staying competitive.

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🏢 Formal Organization: Role and Structure

✅ What is a Formal Organization?

A formal organization is a deliberate and officially established structure designed to achieve

specific goals. It is governed by a set of rules, roles, and a hierarchy of authority.

🧩 Structure of a Formal Organization

The structure refers to how work is divided, coordinated, and supervised. It typically includes:

Element Explanation
A vertical chain of command (e.g., Director → Manager →
🔝 Hierarchy
Employees).
🏫 Division of Labor Work is divided among individuals based on specialization.
Formal rules guide how tasks are performed and how decisions
📄 Rules & Procedures
are made.
💼 Authority & Responsibility Each position has defined power and duties.
Mechanisms (like meetings or memos) ensure different units
🔗 Coordination
work together.
Most communication is documented and official (memos,
🧾 Written Communication
reports, emails).
🎯 Role of a Formal Organization

The formal organization plays several key roles:

Role How it Works

Organizes people and resources to meet objectives (e.g.,
✅ Goal Achievement
service delivery).
⚖️Maintaining Order & Uses rules and hierarchy to ensure employees follow proper
Discipline procedures.
Specialization and structure help streamline tasks and
📈 Efficiency and Productivity
reduce duplication.
📢 Clarity in Roles and Everyone knows their duties, who they report to, and what
Expectations is expected of them.
With clear structure, performance can be monitored and
🧾 Accountability and Control
evaluated effectively.
🛠️Support for Planning and Helps manage large-scale operations and long-term
Coordination planning.

📌 Example: Government Office

 Structure: Secretary → Deputy Secretary → Section Officers → Clerks

 Role: Deliver services, enforce policies, manage public resources

🏢 5 Key Characteristics of a Formal

Organization
A formal organization is a deliberately structured and officially recognized system where
roles, responsibilities, and relationships are clearly defined to achieve specific goals (like a
school, government office, or company).

1. Clearly Defined Hierarchy

 Hierarchy means a structured chain of command from top management to lower staff.
 Everyone knows who reports to whom and who holds authority.
 Example: In a school, the Principal > Vice Principal > Teachers > Students.
2. Authority and Responsibility

 Authority is the right to give orders, while responsibility is the duty to perform tasks.
 Each position in a formal organization comes with specific powers and duties.
 Higher authority = more responsibility.
 Example: A Manager can assign work, and subordinates are responsible for completing
it.

3. Formal Rules and Procedures

 Work is carried out based on written rules, policies, and procedures.

 These ensure uniformity, discipline, and fairness in operations.
 Example: Government offices follow rules for promotions, transfers, and leave.

4. Job Specialization and Division of Labor

 Tasks are divided based on skills and qualifications.

 Each employee performs a specific role to improve efficiency.
 Example: In a hospital, doctors treat patients, nurses assist, and admin staff manage
records.

5. Impersonality

 Decisions are made objectively, not based on personal relationships.

 Promotes fairness and reduces favoritism or bias.
 Example: A public servant cannot favor a friend while processing applications.

🏛️Principles of Public Sector Management

Public Sector Management refers to how government organizations are run to deliver public
services efficiently, fairly, and responsibly.

🌟 Core Principles:
 Principle Explanation
Public officials must answer for their actions to the people, media,
✅ Accountability
and government.
📊 Efficiency Using limited resources wisely to deliver maximum results.
Services should be delivered without discrimination; everyone has
⚖️Equity and Fairness
equal access.
Decisions and actions should be open and understandable to the
📢 Transparency
public.
📈 Performance
Focus on outcomes and results, not just procedures.
Orientation
👥 Participation &
Citizens and stakeholders should have a voice in decision-making.
Inclusion
The government should quickly respond to the needs and problems
🔁 Responsiveness
of citizens.
🧭 Rule of Law Decisions must follow laws, policies, and due process.

🔄 New Public Management (NPM) Approach

📘 Definition:

New Public Management (NPM) is a reform movement that started in the 1980s-90s to make
the public sector more like the private sector — focusing on results, efficiency, and
customer service.

🔑 Key Features of NPM:

Feature What it Means

🏢 Decentralization Shifting power from central to local departments/agencies
📋 Performance
Focus on outputs, results, and evaluations (KPIs, targets)
Measurement
Giving public managers more flexibility like private sector
💼 Managerial Autonomy
managers
📈 Efficiency and Cost- Reducing waste, using market mechanisms (like outsourcing
cutting services)
👥 Customer Focus Treating citizens as clients and improving service satisfaction
📑 Contracting out Services Letting private firms or NGOs deliver some public services
🏫 Professionalism Promoting skill-based recruitment and result-oriented leadership

🏛️Good Governance in Public Management

📘 Definition:

Good governance means managing public affairs and resources ethically, transparently, and
effectively, ensuring that citizens’ rights and interests are respected.

📍 Key Elements of Good Governance (by UNDP & World Bank):

Element Explanation
✅ Accountability All actors (officials, politicians) must answer for their decisions.
🧭 Rule of Law Laws are enforced equally; protects human rights.
📢 Transparency Decisions are made openly with accessible information.
👥 Participation Citizens can voice their views and engage in policy-making.
⚖️Equity All groups (rich, poor, men, women) treated fairly.
📈 Effectiveness & Efficiency Services delivered in a timely and cost-effective way.
🧱 Strategic Vision Long-term planning with broad consensus on national goals.

🧾 Summary:

Public Sector Management today is guided by principles of accountability, efficiency,

transparency, and citizen-focused service delivery, especially through reforms like New
Public Management and frameworks promoting Good Governance.

👨‍💼 Role of Leadership in Organizations (Easy Explanation)

🌟 What is Leadership?

Leadership means guiding and motivating others to work together and reach a goal.

In public organizations (like government offices), leadership is important to provide good

services to people, solve problems, and manage teams.

✅ Why Leadership is Important in Public Organizations?

🌟 Role 💡 Why It Matters

🎯 Gives Direction Leaders guide the team and set goals.
 🌟 Role 💡 Why It Matters
💪 Motivates Workers Good leaders encourage employees to work hard.
⚖️Ensures Fairness Leaders make sure everyone is treated fairly and honestly.
Leaders help others adjust during big changes (new rules, reforms,
🔄 Manages Change
etc.).
📈 Improves Performance They find better ways to serve the public.
🫱 Builds Trust Good leadership makes citizens trust the government.

🚧 Modern Problems (Challenges) for Public Leaders

Today, public sector leaders face many new and tough challenges:

❗ Challenge 💡 What It Means

🌐 Fast-Changing World They must handle global issues like climate change and technology.
💻 Technology Shift They need to lead the move to online services and e-governance.
⚖️Political Pressure Leaders must stay fair and not be influenced by politics.
💸 Less Budget They must do more work with fewer resources.
Diverse Teams They should support equality for all staff (gender, culture, etc.).
📢 Public Demands People want quick, clear, and honest services.
🧓 Aging Staff Many old workers are retiring, so leaders must train new ones.
Leaders must be ready for emergencies like floods, diseases, or
🆘 Crises
disasters.

🤝 Human Relations Theory (‫)آسان الفاظ میں‬

📘 What is it?

The Human Relations Theory focuses on how people (workers) feel at work. It says that when
employees feel respected, heard, and valued, they work better and happier.

👤 Founder:

This theory was developed by Elton Mayo in the 1920s-1930s after his famous Hawthorne
Studies at the Western Electric Company.
🌟 Main Ideas of Human Relations Theory:
💡 Point 🔍 Explanation
😊 Employees are humans, not Workers have emotions, needs, and feelings – not just
machines physical needs.
Talking and listening to workers builds trust and better
🗣️Communication is important
performance.
People work better in groups or teams where they feel
🤝 Teamwork matters
supported.
❤️Motivation comes from feeling Praise, attention, and a friendly environment make
valued employees more productive.
👥 Good relationships with Friendly managers who understand staff create a better
supervisors workplace.

🔍 Hawthorne Studies – What happened?

 Elton Mayo studied factory workers.
 He found that when workers got attention, their performance improved – even if
working conditions didn’t change much!
 Result: Social and emotional support matter more than just rules or money.

✅ In Simple Words:
Human Relations Theory says:
“If you treat employees well, talk to them, and respect their feelings, they’ll work better and
help the organization grow.”

📌 Why is it important today?

 Helps build positive work environments.
 Encourages employee satisfaction.
 Useful in both public and private sector organizations.

🏢 Understanding Organizations (‫)آسان الفاظ میں‬

✅ 1. Importance of Organizations

Organizations are groups of people who work together to achieve common goals.

In the public sector, organizations like government departments, hospitals, schools, and
municipal bodies deliver services to citizens.

🔹 Why are they important?

 Provide structure and teamwork

 Help in dividing work and responsibility
 Increase efficiency and output
 Make public service delivery possible

Example: NADRA, WAPDA, Ministry of Health — all are organizations doing organized work
for the public.

❓ 2. Debate on the Nature and Role of Organizations

Experts have different views on what organizations are and how they should function.

🧠 View 💬 Belief
Formal View Organizations are well-structured systems with clear rules, roles, and goals.
Informal Organizations are social systems where people build relationships and affect
View outcomes.
Political View Power and influence also shape how organizations work – not just structure.

So, organizations are not just machines — they are also human, social, and political spaces.

🏛️3. Types of Organizations

🔠 Type 📘 Description 📌 Example

Formal Organization Has clear rules, goals, roles. Ministry of Education
Built on friendships and unofficial Staff bonding during tea
Informal Organization
networks. break
Hospitals, police
Public Organization Run by government to serve people.
departments
Run for profit by
Private Organization Banks, companies
individuals/companies.
Non-Governmental Edhi Foundation,
Not for profit, works for social good.
Organization (NGO) Akhuwat
💰 4. Importance of Organizations in Public Money Management

Organizations play a key role in managing taxpayer money properly and responsibly.

🔹 Why?

 To ensure accountability and transparency

 To deliver services like health, education, and justice
 To control spending and avoid corruption
 To measure performance and results

Example: Auditor General of Pakistan checks if public money is being used honestly.

📚 5. Key Theories of Organization

Here are some famous theories that help us understand how organizations work:

📘 Theory 💡 Main Idea

Focus on structure, rules, and efficiency (e.g., Max Weber’s
Classical Theory
bureaucracy).
Human Relations
Focus on people’s emotions and teamwork (e.g., Elton Mayo).
Theory
Systems Theory Organizations are like living systems – every part is connected.
Contingency Theory No one-size-fits-all — structure depends on the situation.
New Public Make public organizations work like private businesses – focus on
Management (NPM) performance, results, and customer service.

🧾 Conclusion (Easy Words)

Organizations help bring order, teamwork, and public service.
In Public Administration, they are central to managing people, programs, and money
efficiently.
Understanding different types and theories helps us improve how the public sector works.

🌐 Network Theory (or Network Perspective)

📘 What is Network Theory?

Network Theory says:

“Organizations cannot work in isolation. To solve complex public problems, they must
collaborate and form networks with other organizations.”

These can include:

 Government departments
 NGOs
 Private companies
 International organizations
 Community groups

📘 Organizational Theory – Overview ( ‫آسان‬

‫)الفاظ میں‬
Organizational theories help us understand:

 How organizations work

 How people behave in them
 How to improve their performance

1️⃣ Classical Theory

 Focuses on structure, rules, discipline, and efficiency.

 Views organization like a machine.
 Emphasizes hierarchy, clear roles, and division of labor.
 Main thinkers: Max Weber, Henri Fayol.

🧠 Example: A government office with fixed duties, strict reporting, and chain of command.
2️⃣ Scientific Management (Taylorism) – by Frederick Taylor

 Focus on improving productivity through scientific study of tasks.

 Believes in "one best way" to do a job.
 Workers should be trained, controlled, and rewarded for better work.

🧠 Example: Setting a standard time for filing 50 forms and training clerks to do it efficiently.

3️⃣ Human Relations Theory (Hawthorne Studies) – by Elton Mayo

 Focuses on people’s feelings, needs, and motivation.

 Says that employee happiness leads to better work.
 Stresses teamwork, motivation, and communication.

🧠 Example: Staff works better when managers listen to their concerns.

4️⃣ Systems Theory

 Organization is like a living system with inputs, processes, and outputs.

 All parts are interconnected. A change in one part affects the whole system.

🧠 Example: A university’s admission policy affects student strength, budget, and teacher load.

5️⃣ Contingency Theory

 Says no one-size-fits-all.
 The best way to manage depends on situation, environment, and size.

🧠 Example: In an emergency, a hospital needs fast decisions. In planning, teamwork may work
better.

6️⃣ Interpretive & Critical Theories

 Interpretive: Focuses on people's experiences, meanings, and culture inside

organizations.
 Critical: Focuses on power, control, and inequality in organizations.
🧠 Example: Why do junior staff feel ignored in decision-making? A critical theorist would study
that.

7️⃣ Institutional Theories

 Says organizations follow rules, traditions, and social expectations to appear

legitimate.
 They may copy other successful organizations, even if not efficient.

🧠 Example: A public office adopts a new system not because it’s better, but because other
offices did.

8️⃣ Economic/Market Theories

Includes:

a. Public Choice Theory

 Officials may act in self-interest rather than public interest.

b. Principal-Agent Theory

 Problems happen when a boss (principal) hires someone (agent) who doesn't act as
expected.

🧠 Example: A contractor is hired to build a road but uses cheap materials. This is a principal-
agent problem.

9️⃣ Political Perspectives

 Organizations are arenas of power and politics.

 Decisions are made through negotiation, influence, and alliances.

🧠 Example: A promotion may be based on influence, not performance.

🔟 Theories of Emergence (Complexity, Adaptive Systems)

 Organizations are dynamic and unpredictable.

  They adapt like living organisms.
 Decisions can't always be planned — sometimes they emerge naturally.

🧠 Example: During COVID-19, many departments had to change policies quickly.

1️⃣1️⃣ Network Perspective (Inter-organizational Collaboration)

 Organizations don't work alone.

 They form networks and partnerships to solve complex problems.

🧠 Example: NEOC, Health Ministry, NADRA, and NGOs work together during a national
health campaign.

✅ In Summary (Easy Chart)

Theory Type Focus
Classical Structure, hierarchy, discipline
Scientific Management Task efficiency, productivity
Human Relations People, motivation, teamwork
Systems Organization as a living system
Contingency “Depends on situation” approach
Interpretive/Critical Meaning, power, inequality
Institutional Legitimacy, copying others
Public Choice / Principal-Agent Self-interest, economic behavior
Political Power, politics, influence
Complexity/Emergence Change, adaptation
Network Collaboration across organizations

Q: Explain the concept of hierarchy in a formal organization.

a) What is hierarchy?
Hierarchy is a system in an organization where people or groups are ranked one above the other
according to status or authority. It helps in organizing roles, responsibilities, and levels of
decision-making.

b) How does hierarchy ensure accountability in public organizations?

Hierarchy ensures accountability by clearly defining roles, duties, and reporting relationships.
Superiors monitor the performance of subordinates and ensure that everyone follows procedures,
laws, and ethical standards. Mistakes or failures can be traced back through the chain of
command.

c) Give one example of a hierarchical structure in any government department.

An example is the Police Department, where the hierarchy might include:

 Inspector General (IG)

 Deputy Inspector General (DIG)
 Superintendent of Police (SP)
 Station House Officer (SHO)
 Sub-Inspector (SI)
 Constable

14 May 2025

Q: Discuss the concept and significance of Good Governance in public management.

a) Define "Good Governance" in the context of public management.

Good governance refers to the effective, efficient, transparent, and accountable management of
public resources and affairs to serve the interests of all citizens fairly and equitably.

b) List and explain any three key principles of good governance:

1. Transparency – Open and clear processes, access to information, and openness in

decision-making.
2. Accountability – Officials are answerable for their actions and must justify decisions to
the public or higher authorities.
3. Rule of Law – All individuals and institutions are subject to and accountable under the
law, which is fairly applied.

c) How does good governance contribute to effective public service delivery?

Good governance improves public service delivery by ensuring that services are delivered
efficiently, equitably, and with proper use of resources. It builds public trust, reduces corruption,
and meets the needs of citizens effectively.

d) Identify two major challenges to achieving good governance in developing countries like
Pakistan:
 1. Corruption – Misuse of power for personal gain weakens institutions.
2. Weak Institutional Capacity – Lack of training, resources, and proper systems reduces
efficiency.

15 May 2025

Q: What is the difference between public and private management?

Aspect Public Management Private Management

Management of government/public Management of private

1. Definition
sector activities businesses/organizations

2. Objectives Public welfare, service delivery Profit maximization, business growth

3. Ownership and Owned by the state; funded by Owned by individuals or corporations;

Funding taxes funded by private capital

Accountable to the public and

4. Accountability Accountable to owners and shareholders
government

5. Decision-Making Often slower due to bureaucracy

Faster and more flexible
Process and regulations