Unit 4- Management &

Operations
Lesson 4- Evolution of Management Theories 2
Learning Objectives Targeted

Differentiate between the role of a leader and

the function of a manager
Critically analyse and evaluate the different
management theories and approaches to
leadership.
Contemporary Perspective on Management

Management Science theory

Systems Theory
Contingency theory
Chaos Theory
 Management Science Theory

Contemporary approach to management that focuses on the

use of rigorous quantitative techniques to help managers
make maximum use of organizational resources to produce
goods and services.
Management Science Theory
Quantitative management — utilizes
linear and nonlinear programming,
modeling, simulation, queuing theory
etc.
Operations management —techniques
used to analyze any aspect of the
organization’s production system.
Management Science Theory
Total Quality Management (TQM) —
focuses on analyzing input, conversion,
and output activities to increase
product quality.
Management Information Systems
(MIS) — provides information vital for
effective decision making.
Systems Viewpoint
Regards the organization as a system of
interrelated parts.
 A collection of subsystems

Synergy – the performance gains that

result from the combined actions of
individuals and departments are more
than all individuals performances taken
together.

Possible only in an organized system.

The Four Parts of A System
Inputs – the people, money, information,
equipment, and materials required to produce an
organization’s goods or services.
Outputs – the products, services, profits, losses,
employee satisfaction or discontent, and the like that
are produced by the organization
Transformation Process – the organization’s
capabilities in management and technology that are
applied to converting inputs into outputs
Feedback – information about the reaction of the
environment to the outputs that affects the inputs
The Open-Systems View
Open System
A system that takes resources for its external
environment and transforms them into goods
and services that are then sent back to that
environment where they are bought by
customers.
The Open-Systems View
Inputs: the acquisition of external resources to produce goods and
services
Conversion: transforms the inputs into outputs of finished goods and
services.
Output: the release of finished goods and services to its external
environment.

A self-contained system that is not affected by changes in its external

environment.
Likely to experience entropy and lose its ability to control itself
Contingency Theory
“There is no one best way to organize”
The idea that the organizational structures and control systems
manager choose depend on—are contingent on—characteristics of
the external environment in which the organization operates.
Contingency Theory
Type of Structure for contingency
Mechanistic
Authority is centralized at the top.
Emphasis is on strict discipline and order
Employees are closely monitored and
managed.
Can be very efficient in a stable
environment.
Organic
Authority is decentralized throughout the
organization.
Departments are encouraged to take a cross-
departmental or functional perspective
Works best when environment is unstable
and rapidly changing
CHAOS THEORY

Henri Poincaré(1854–1912)
Chaos theory is a scientific principle describing the unpredictability of
systems. Most fully explored and recognized during the mid-to-late
1980s, its premise is that systems sometimes reside in chaos, generating
energy but without any predictability or direction.

Read more: 
http://www.referenceforbusiness.com/management/Bun-Comp/Chaos-
Theory.html#ixzz4X9qBGSIS
Chaos theory
Applying chaos theory allows theorists to take a step back from the
management of day-to-day activities and see how organizations
function as unified systems.
An organization is a classic example of a nonlinear system (i.e., a
system in which minor events have the potential to set off grave
consequences or chain reactions, and major changes may have little or
no effect on the system whatsoever).
In order to exploit the chaotic quality of an organization, one needs to
try to see the organizational shape. Instead of pinpointing causes in the
organization for organizational problems, the company is better
served, according to chaos theory, by looking for organizational
patterns that lead to certain types of behavior within the organization.

Read more: 
http://www.referenceforbusiness.com/management/Bun-Comp/Chaos-
Theory.html#ixzz4X9tbHHy6