MANAGEMENT THEORY Veritas

Course outline of Management Theory
• This course is to guide each participant develop and refine his or her
understanding of management theory and concepts and how they can be applied
to real-world situations and contribute to the growth of the organization. Gain
greater self- awareness, see multiple points of view, and perform your role as a
manager more effectively and confidently.
• More specifically:
• Explain the roles and functions of management
• Increase your self-awareness
• Apply theories to practice
• Perform your role as a manager more effectively and confidently
• Be a better problem solver and decision maker
Course outline of Management Theory
• This course is to guide each participant develop and refine his or her
understanding of management theory and concepts and how they can be applied
to real-world situations and contribute to the growth of the organization. Gain
greater self- awareness, see multiple points of view, and perform your role as a
manager more effectively and confidently.
• More specifically:
• Explain the roles and functions of management
• Increase your self-awareness
• Apply theories to practice
• Perform your role as a manager more effectively and confidently
• Be a better problem solver and decision maker
Introduction
• Introduction: Management – definitions, types of managers; managerial roles and functions; Science or Art? - Administration
vs Management, External environment – Managing people and organizations in the context of New Era- Managing for
competitive advantage - the Challenges of Management - Corporate Social responsibility- Managerial Ethics.
• 2. Perspectives on Management: Scientific Management (Fredrick W.Taylor, Frank and Lillian Gilbreth), Human Relations (Elton
Mayo, Douglas Mc Gregor's Theory X and Theory Y, William Ouchi's Theory Z), the Systems Approach, the Contingency
Approach, the Mckinsey 7-S Framework.
• 3. Planning: Nature of planning, Steps in planning, types of planning, Levels of planning - The Planning Process. – Planning
practices in USA, Japan and China.
• 4. Decision Making: Problem and Opportunity finding, the nature of Managerial Decision Making, the Rational Model of
Decision Making, Challenges to the Rational Model, Improving the Effectiveness of Decision Making Tools and Techniques, Role
of Boards and Committees in Decision Making - Decision making practices abroad.
• 5. Organising: Nature of organizing, organization levels and span of management – Factors determining span - Organisational
design and structure –departmentation, line and staff concepts, staffing – delegation, decentralization and recentralisation of
authority - responsive organizations –Global organizing.
• 6. Leading: Leading Vs Managing – Trait approach and Contingency approaches to leadership - Dimensions of Leadership -
Leadership Behavior and styles – developing leadership skills – transformational leaders - Leadership in Cross-cultural
environment - Evaluating Leader- Women and Corporate leadership –Motivational theories- Building Groups into Teams,
Intergroup Behavior, conflict and negotiation – Global leading.
• 7. Communication: Importance of Communication, Interpersonal communication Barriers to Effective communication,
Communication in Organizations, Using Communication Skills to manage Conflicts. Communicating for understanding and
results, creating productive interpersonal relationships, Guidelines to improve written and oral communication-
communication practices in India and abroad.
MANAGEMENT THEORY BUS 311.
Management: An introduction
• Workplaces depend on the strength of those in management positions. In addition to

directing employees, managers must communicate with more senior professionals in
their company to ensure the team meets goals and furthers the company’s mission.
Although the duties of managers differ based on their industry and workplace, most
fulfill the same basic responsibilities.
• Management is the coordination and administration of tasks to achieve a goal. Such
administration activities include setting the organization’s strategy and coordinating
the efforts of staff to accomplish these objectives through the application of available
resources. Management can also refer to the seniority structure of staff members
within an organization.
• Management is a process of planning, decision making, organizing, leading,
motivation and controlling the human resources, financial, physical, and information
resources of an organization to reach its goals efficiently and effectively.
• Definition of Management :
• Management is defined as an act of managing people and their work, for achieving
a common goal by using the organization’s resources. It creates an environment
under which the manager and his subordinates can work together for the
attainment of group objective. It is a group of people who use their skills and
talent in running the complete system of the organization. It is an activity, a
function, a process, a discipline and much more.
• Planning, organizing, leading, motivating, controlling, coordination and decision
making are the major activities performed by the management. Management
brings together 5M’s of the organization, i.e. Men, Material, Machines, Methods,
and Money. It is a result oriented activity, which focuses on achieving the desired
output.
• Management as a process:
Management as a process includes planning, controlling, coordinating, motivating, and staffing.
All these are interrelated sequential functions. Thus, management is the efforts of the members
of the organization to accomplish the organizer’s objectives.  Management as a discipline:
As a discipline, management is a specific branch of knowledge which is studied in campuses and
schools like economics, sociology, mathematics, political science etc. Experts and researchers
feel that the information gained through this discipline helps in practical life for better
functioning thereby increasing the scope of management as a discipline.
 Management as a noun:
The word management itself is a noun. There are various kinds of employees in an organization,
where some are involved in managerial function and some are involved in operating functions.
The individuals who manage the organization and departments are called as managers. In the
field, as a noun the term management is used as single name of managers, board of directors,
managing directors, departmental managers etc.
• Objectives of Management
 Proper Utilization of Resources: The main objective of management is to use the available
resources of the enterprise in a most economical way. The proper use of human and material
resources will help a business to earn profits to satisfy various interests. In any business, the
proprietors will want more returns on their investments while employees, customers and public will
expect a fair deal from the management. All these interests will be satisfied only when the resources
of the business are judiciously utilized.
 Improving Performance: Management should aim at improving the performance of each and
every factor of production. The environment should be so congenial that workers are able to give
their best.
 Mobilizing Best Talent: The management should employ persons in various fields so that better
results are possible. The better pay scales, proper facilities, future growth plans will attract more
people in joining the organization.
 Planning for Future: The management should not feel satisfied with today’s work if it has not
planned for its future. The future performance should depend upon the present planning. Thus,
planning for future is essential to help the organization grow.
• A manager’s primary challenge is to solve problems creatively, and you should

view management as “the art of getting things done through the efforts of
other people.
• Management is the process of guiding the development, maintenance, and
allocation of resources to attain organizational goals.
• Management is a purposeful activity. It is a tool which helps use of human &
physical resources to fulfill the pre-determined goals.
• Management is dynamic by nature and evolves to meet needs and constraints
in the organization’s internal and external environments.
• In a global marketplace where the rate of change is rapidly increasing, flexibility
and adaptability are crucial to the managerial process.
• This process is based in four key functional areas of the organization: planning,
organizing, leading, and controlling.
• Features of Management
• Management is the process of setting and reaching goals effectively and
efficiently. Management process has some qualities or features;
1.Management is Associated with Group Efforts
2.Management is Purposeful
3.Management is Accomplished Through the Efforts of Others
4.Management is Goal-oriented
5.Management is Indispensable
6.Management is Intangible
7.Management can Ensure Better Life
Who is a Manager
• To be an effective manager, you’ll need to develop a set of skills, including

planning, communication, organization and leadership. You will also need
extensive knowledge of the company’s goals and how to direct employees, sales
and other operations to accomplish them.
Five basic operations of a manager
• Five basic operations of a manager

• In general, there are five basic functions of a manager:
1.Setting objectives
2.Organizing
3.Motivating the team
4.Devising systems of measurement
5.Developing people
• 1. Setting objectives
• Setting and achieving objectives is the primary way a manager accomplishes and maintains success. They must
also be able to convey them to their staff or employees in a compelling manner. For instance, a restaurant
manager could state they want to improve service times and remind employees that faster service increases
revenue and tips.
• 2. Organizing
• Managers evaluate the type of work, divide it into achievable tasks and effectively delegate it to staff.
Organization consists of a series of relationships among individual staff as well as departments or entities inside
the organization. It is the manager’s responsibility to ensure that these individuals and entities work together in
harmony, which includes motivating staff members and departments to stay on task. A good manager is skilled at
building interpersonal relationships among their team members and can troubleshoot when members confuse their
encounter challenges.
• Organization also requires a manager to establish relationships of authority among their team members.
Maximizing organizational arrangements can help businesses enhance the company’s efficiency in the market,
reduce the costs of business and improve productivity.
• 3. Motivating the team
• In addition to the tasks of organization and delegation, motivation includes having the skills to handle different
types of personalities in a team. An effective manager must know how to form and lead successful teams and
know how to galvanize team members around a cause.
• 4. Devising systems of measurement

• Managers need to set targets or key performance indicators that the team aims for and
then generate ways to measure whether their team is on track to meet those goals.
Because it can be challenging to come up with measurable ways of understanding
performance, managers must often be creative and thoughtful. However, like the other
functions of management, measurement is critical to improving business performance.
• 5. Developing people
• In addition to leading their team toward a goal and measuring their progress along the
way, good managers invest in their staff’s development. Managers can, for example,
work with their team to help them set goals to move up in their careers.
• Managers must have leadership skills to use these five operations successfully. They are
responsible for coaching their team members by helping them recognize their strengths
and weaknesses and improve their performance. Different managers may have different
styles of leadership.Regardless of their style, managers should develop their leadership
skills to be an effective supervisor.
Managerial roles
• Managerial roles are specific behaviors associated with the task of

management. Managers adopt these roles to accomplish the basic
functions of management just discussed—planning and strategizing,
organizing, controlling, and leading and developing employees. One of the
earliest and most enduring descriptions of managerial roles comes from
Henry Mintzberg,who (as we have already noted) shadowed managers
observing what they did during the day.
• Mintzberg developed a list of roles that he grouped into three categories:
interpersonal roles, informational roles, and decisional roles. Mintzberg
emphasized that managing is an integrated activity, so these roles are
rarely distinct. Visiting clients, for instance, usually relates to two or more
roles simultaneously.
Managerial roles
• INTERPERSONAL ROLES
• Interpersonal roles are roles that involve interacting with other people inside and outside the organization. Management jobs are
people-intensive: Research suggests that managers spend somewhere between 66 and 80 percent of their time in the company
of others. 20 Seldom do managers work alone for long periods without outside communication. As Linda Hill noted, managers
get things done through their network of interpersonal relationships. Mintzberg identified three types of interpersonal roles: a
figurehead role, a leader role, and a liaison role.
• Managers at all levels are figureheads . They greet visitors, represent the company at community events, serve as spokespeople,
and function as emissaries for the organization.
• INFORMATIONAL ROLES
• Informational roles are concerned with collecting, processing, and disseminating information. Managers collect information from
various sources both inside and outside the organization, process that information, and distribute it to others who need it.
Mintzberg found that managers 40 percent of their time in these tasks. Mintzberg divided the information roles of management
into three types: monitor, disseminator, and spokesperson.
• Managers rely on both formal and informal channels to collect the information required for effective monitoring. Formal channels
include the organization’s own internal accounting information systems and data provided by important external agencies. By
monitoring the external competitive and internal organizational environment for information, managers try to gain knowledge
about how well the organization is performing and whether any changes in strategy or operational processes are required. One
thing managers do with this information is disseminate it to direct reports and others inside the organization. In
their dissemination role managers regularly inform staff about thecompany’s direction and sometimes about specific technical
issues. At the supervisory level, the disseminator role often takes the form of one-to-one informal conversations with
specificemployees about particular matters.
• In their spokesperson role, managers deliver specific information to individuals and groups located outside their department or
organization. Sales managers communicate with business partners regarding new sales strategies. Division heads give
presentations to their colleagues in other divisions about strategies and resource requirements.
Managerial roles
• DECISIONAL ROLES
• Management guru Peter Drucker once wrote that whatever managers do, they do through making decisions.
The information collected through monitoring is directed toward discovering problems or opportunities,
weighing options, making decisions, and ensuring that those decisions are put into action. Whereas
interpersonal roles deal with people and informational roles deal with knowledge, decisional roles deal with
action.
• They translate the people and information into processes with the purpose of moving the organization toward
its strategic goals. Mintzberg identified four decision roles: entrepreneur, disturbance handler, resource
allocator, and negotiator.
• To survive in competitive markets, firms must be entrepreneurial. They must pioneer new products and
processes and quickly adopt those pioneered by others. In their role as entrepreneurs, managers must make
sure that their organizations innovate and change when necessary,developing or adopting new ideas and
technologies and improving their own products and processes. They must make decisions that are consistent
with such entrepreneurial behavior. If they do not, their organizations will be quickly outflanked by more nimble
competitors.
• Managing is full of paradoxes, and this is partly apparent when we contrast the proactive entrepreneurial role
with the reactive disturbance handler role. Disturbance handling includes addressing unanticipated problems
as they arise and resolving them expeditiously. In managerial work unanticipated problems arise often. Sales
may grow more slowly than anticipated; excess inventory may accumulate; production processes may break
down; valuable employees might leave for jobs elsewhere; and so on. Managers must decide what to do about
these unanticipated problems—often quickly.
Managerial roles
• DECISIONAL ROLES
• An important class of management decisions involves resource allocation . Organizations never have enough
money, time, facilities, or people to satisfy all their needs. Resources are scarce and can be used in many
different ways. A crucial decision responsibility of managers is to decide how best to allocate the scarce
resources under their control between competing claims in order to meet the organization’s goals.
• As a resource allocator, a manager in charge of product development, for example, may have to assign people,
money, and equipment to three different product development teams. A marketing manager may apportion
money between media advertising and point-of-sale promotions. A production manager may havelimited funds
for new equipment. In general, resource allocation decisions should be guided by the strategy of the
organization.
• Negotiating is continual for managers. They negotiate with suppliers for better delivery, lower prices, and higher-
quality inputs. They negotiate with customers over the pricing, delivery, and design of products and services.
They negotiate with peers in their own organization over shared resources and cooperative efforts. They
negotiate with their superiors for access to scarce resources, including capital, personnel, and facilities.
• They even negotiate with subordinates in their own work unit, trying to allocate employees between tasks to
meet the goals of both the organization and individual employees. Managers who are successful when making
negotiation decisions can lower input costs, strike better deals with customers, gain access to more high-
quality resources within the organization, and better organize their own subordinates. Skilled negotiators are
more likely to successfully implement strategy and raise the performance of their organizations.
Management concepts
• A manager needs to understand a few simple ideas to employ the five basic operations. These
concepts are essential to ensure their team comes together to reach the business’ goals:
• Control: Employees of an organization need to understand the goals that they are aiming for
as well as the measurement that will be used to determine whether they have been successful.
Different staff members in a company have different roles that entail separate levels of
responsibility. A manager must have control over what the members do, how they do it and
how to measure their progress. Control over these factors helps a manager reach success.
•
Planning: The best managers know that planning is critical before the implementation of any
strategy, but it is also an ongoing activity. Planning does not end when implementation begins.
Rather, management needs to be prepared to answer the questions of who, what, when and
where a team is working to implement the organization’s mission. Planning should include
selecting objectives as well as implementing them.
• Staffing: Staffing is an underappreciated but crucial function of management. Managers need
to ensure that they have the right people for the job, but they also need to pay attention to
issues like organizing workplace policies. The company needs to retain the best talent by
providing incentives such as benefits, paid time off and a thorough training program.
Management styles
• Types of management styles

• Authoritative management style. ...
• Persuasive management style. ...
• Paternalistic management style. ...
• Consultative management style. ...
• Participative management style. ...
• Collaborative management style. ...
• Transformational management style. ...
• Coaching management style.
Management styles
• Analysts who study management have identified several effective leadership styles. There is no one best
style of management, and some people will feel more personally suited to one type or another. You can
also select elements of different styles of management to create the best archetype for you and your
company.
• Persuasive management style
• A compelling leader spends a lot of time with their team members. Being engaged with employees allows the persuasive
manager to lead by example, and to gain buy-in and compliance from the team by persuading rather than instructing or
demanding. Influential managers are aware of the work that their team members are doing on a day-to-day basis and are
involved in their work lives.
• Democratic management style
• A democratic manager invites the team to be directly involved in decision-making. Open lines of communication between
democratic managers and employees allow these types of managers to understand the skills and advantages that each
employee brings to the table. Open participation and exchange of ideas among different levels of employees allow everyone
to contribute to the outcome of a decision or a project.
• This style of management is more successful when managers develop organized and streamlined decision-making processes.
Otherwise, accepting input from everyone can make the process sluggish and disorganized.
• Laissez-faire management
• The laissez-faire manager functions almost more like a mentor than a manager. They empower their employees to step up and
make decisions. This allows the team to feel like they own a part of each project. The manager takes a backseat role, stepping
in to offer advice or get things back on track when something goes wrong. Otherwise, they stand aside, allowing their
employees to flourish creatively and exercise their own leadership.
Types of Managers
• Most organizations, however, still have four basic levels of management: top,
middle, first line, and team leaders.
• Top-Level Managers. As you would expect, top-level managers (or top
managers) are the “bosses” of the organization. ...
• Middle Managers. ...
• First-Line Managers. ...
• Team Leaders.
Theory
• a supposition or a system of ideas intended to explain something, especially one based
on general principles independent of the thing to be explained.
• When you have a theory, you have a set of beliefs or principles that might not be
proven yet. ... A theory is a set of accepted beliefs or organized principles that explain
and guide analysis and one of the ways that theory is defined is that it is different from
practice, when certain principles are tested.
• to develop a theory, you'll need to follow the scientific method. First, make measurable
predictions about why or how something works. Then, test those predictions with a
controlled experiment, and objectively conclude whether or not the results confirm
the hypotheses.
• A good theory in the theoretical sense is (1) consistent with empirical observations; is
(2) precise, (3) parsimonious, (4) explanatorily broad, and (5) falsifiable; and (6)
promotes scientific progress (among others;
• Theories and laws are also distinct from hypotheses. Unlike hypotheses, theories and
laws may be simply referred to as scientific fact.
Theory
Purpose-Theories are formulated to explain, predict, and understand phenomena
and, in many cases, to challenge and extend existing knowledge within the limits
of critical bounding assumptions. The theoretical framework is the structure that
can hold or support a theory of a research study
Importance-Theories are vital: They guide and give meaning to what we see.
When a researcher investigates and collects information through observation, the
investigator needs a clear idea of what information is important to collect. Thus,
valid theories are validated by research and are a sound basis for practical action.
Essential Management Theories
• Essential Management Theories

• 1) Systems Theory.
• 2) Principles Of Administrative Management.
• 3) Bureaucratic Management.
• 4) Scientific Management.
• 5) Theories X And Y.
• 6) Human Relations Theory.
• 7) Classical Management.
• 8) Contingency Management
Types of Managers
• Top-Level Managers
• As you would expect, top-level managers (or top managers) are the “bosses” of the organization.
They have titles such as chief executive officer (CEO), chief operations officer (COO), chief
marketing officer (CMO), chief technology officer (CTO), and chief financial officer (CFO). A
new executive position known as the chief compliance officer (CCO) is showing up on many
organizational charts in response to the demands of the government to comply with complex rules
and regulations. Depending on the size and type of organization, executive vice presidents and
division heads would also be part of the top management team. The relative importance of these
positions varies according to the type of organization they head. For example, in a pharmaceutical
firm, the CCO may report directly to the CEO or to the board of directors.
• Top managers are ultimately responsible for the long-term success of the organization. They set
long-term goals and define strategies to achieve them. They pay careful attention to the external
environment of the organization: the economy, proposals for laws that would affect profits,
stakeholder demands, and consumer and public relations. They will make the decisions that affect
the whole company such as financial investments, mergers and acquisitions, partnerships and
strategic alliances, and changes to the brand or product line of the organization.
Types of Managers
• Middle Managers
Middle managers have titles like department head, director, and chief supervisor.
They are links between the top managers and the first-line managers and have one
or two levels below them. Middle managers receive broad strategic plans from top
managers and turn them into operational blueprints with specific objectives and
programs for first-line managers. They also encourage, support, and foster talented
employees within the organization. An important function of middle managers is
providing leadership, both in implementing top manager directives and in enabling
first-line managers to support teams and effectively report both positive
performances and obstacles to meeting objectives
Is Management an ART or SCIENCE
• Management is science because of several reasons like - it has universally accepted principles, it
has cause and effect relationship etc, and at the same time it is art because it requires perfection
through practice, practical knowledge, creativity, personal skills etc.
• Management is both an art and a science. Management combines features of both science as well
as art. It is considered as a science because it has an organized body of knowledge which
contains certain universal truth. It is called an art because managing requires certain skills which
are personal possessions of managers. Science provides the knowledge & art deals with the
application of knowledge and skills.
• A manager to be successful in his profession must acquire the knowledge of science & the art of
applying it. Therefore management is a judicious blend of science as well as an art because it
proves the principles and the way these principles are applied is a matter of art. Science teaches
to ‘know’ and art teaches to ‘do’. E.g. A person cannot become a good singer unless he has
knowledge about various ragas & he also applies his personal skill in the art of singing. Same way
it is not sufficient for manager to first know the principles but he must also apply them in solving
various managerial problems that is why, science and art are not mutually exclusive but they are
complementary to each other (like tea and biscuit, bread and butter etc.).
• The old saying that “Manager are Born” has been rejected in favor of “Managers are Made”. It has
been aptly remarked that management is the oldest of art and youngest of science. To conclude,
we can say that science is the root and art is the fruit.
Management as SCIENCE
• Science is a systematic body of knowledge pertaining to a specific field of
study that contains general facts which explains a phenomenon. It
establishes cause and effect relationship between two or more variables
and underlines the principles governing their relationship. These principles
are developed through scientific method of observation and verification
through testing.
• Science is characterized by the following main features:
• 1. Universally acceptance principles – Scientific principles represents basic
truth about a particular field of enquiry. These principles may be applied in
all situations, at all time & at all places. E.g. – law of gravitation which can
be applied in all countries irrespective of the time. Management also
contains some fundamental principles which can be applied universally like
the Principle of Unity of Command i.e. one man, one boss. This principle is
applicable to all type of organization – business or non business.
• 2. Experimentation & Observation – Scientific principles are derived
through scientific investigation & researching i.e. they are based on logic.
E.g. the principle that earth goes round the sun has been scientifically
proved. Management principles are also based on scientific enquiry &
observation and not only on the opinion of Henry Fayol. They have been
developed through experiments & practical experiences of large number of
managers. E.g. it is observed that fair remuneration to personal helps in
creating a satisfied work force.
• 3. Cause & Effect Relationship – Principles of science lay down cause and
effect relationship between various variables. E.g. when metals are heated,
they are expanded. The cause is heating & result is expansion. The same
is true for management, therefore it also establishes cause and effect
relationship. E.g. lack of parity (balance) between authority & responsibility
will lead to ineffectiveness. If you know the cause i.e. lack of balance, the
effect can be ascertained easily -in effectiveness
• Similarly if workers are given bonuses, fair wages they will work hard but when not
treated in fair and just manner, reduces productivity of organization. 4. Test of Validity &
Predictability – Validity of scientific principles can be tested at any time or any number
of times. They stand the test of time. Each time these tests will give same result.
• Moreover future events can be predicted with reasonable accuracy by using scientific
principles. E.g. hydrogen & oxygen will always give water. Principles of management
can also be tested for validity. E.g. principle of unity of command can be tested by
comparing two persons – one having single boss and one having 2 bosses. The
performance of 1st person will be better than 2nd. It cannot be denied that
management has a systematic body of knowledge but it is not as exact as that of other
physical sciences like biology, physics, and chemistry etc.
• The main reason for the inexactness of science of management is that it deals with
human beings and it is very difficult to predict their behavior accurately. Since it is a
social process, therefore it falls in the area of social sciences. It is a flexible science &
that is why its theories and principles may produce different results at different times
and therefore it is a behavioral science. Ernest Dale has called it as a Soft Science.
Management AS an ART
• Art implies application of knowledge & skill to trying about desired results.
An art may be defined as personalized application of general theoretical
principles for achieving best possible results.
• Art has the following characters –
• 1. Practical Knowledge: Every art requires practical knowledge therefore
learning of theory is not sufficient. It is very important to know practical
application of theoretical principles. E.g. to become a good painter, the
person may not only be knowing different colour and brushes but different
designs, dimensions, situations etc to use them appropriately. A manager
can never be successful just by obtaining degree or diploma in
management; he must have also know how to apply various principles in
real situations by functioning in capacity of manager
• 2. Personal Skill: Although theoretical base may be same for every artist,
but each one has his own style and approach towards his job. That is why
the level of success and quality of performance differs from one person to
another. E.g. there are several qualified painters but M.F. Hussain is
recognized for his style. Similarly management as an art is also
personalized. Every manager has his own way of managing things based
on his knowledge, experience and personality, that is why some managers
are known as good managers (like Aditya Birla, Rahul Bajaj) whereas
others as bad.
• 3. Creativity: Every artist has an element of creativity in line. That is why he
aims at producing something that has never existed before which requires
combination of intelligence & imagination. Management is also creative in
nature like any other art. It combines human and non-human resources in
useful way so as to achieve desired results. It tries to produce sweet music
by combining chords in an efficient manner.
• 4. Perfection through practice: Practice makes a man perfect. Every artist
becomes more and more proficient through constant practice. Similarly
managers learn through an art of trial and error initially but application of
management principles over the years makes them perfect in the job of
managing.
• 5. Goal-Oriented: Every art is result oriented as it seeks to achieve concrete
results. In the same manner, management is also directed towards
accomplishment of pre-determined goals. Managers use various resources like
men, money, material, machinery & methods to promote growth of an
organization. Thus, we can say that management is an art therefore it requires
application of certain principles rather it is an art of highest order because it deals
with moulding the attitude and behavior of people at work towards desired goals.
• 6. Work by effectively. manager manage all problem in every environment so this
is not science, it is an art that how he manage every problem of organization in
every environment.
Management as both Science and Art
• Management is both an art and a science. The above mentioned points

clearly reveals that management combines features of both science as
well as art. It is considered as a science because it has an organized
body of knowledge which contains certain universal truth. It is called an
art because managing requires certain skills which are personal
possessions of managers.
• Science provides the knowledge & art deals with the application of
knowledge and skills. A manager to be successful in his profession must
acquire the knowledge of science & the art of applying it. Therefore
management is a judicious blend of science as well as an art because it
proves the principles and the way these principles are applied is a matter
of art.
Management as both Science and Art
• Science teaches to ’know’ and art teaches to ’do’. Example. a person

cannot become a good singer unless he has knowledge about various
ragas & he also applies his personal skill in the art of singing. Same way
it is not sufficient for manager to first know the principles but he must also
apply them in solving various managerial problems that is why, science
and art are not mutually exclusive but they are complementary to each
other (like tea and biscuit, bread and butter etc.).
• The old saying that “Manager are Born” has been rejected in favor of
“Managers are Made”. It has been aptly remarked that management is
the oldest of art and youngest of science. To conclude, we can say that
science is the root and art is the fruit.
Administration vs Management
• Management relates to conducting, controlling and taking charge of the course

of action. The word "management" comes from the word "manes" which means
"to control by hand". It is a middle level activity.
• Management involves the achievement of results for which the responsibility
pays the manager. Management also includes involving organization to achieving
objectives with maximum efficiency and responsibility for the result.
• Management is the act or function of putting into practice the policies and plans
decided upon by the administration.
• Management is inferior to administration, and is focused on motivating and
controlling functions as well as technical abilities and human resources abilities.
It deals with employees.
Administration vs Management
• Administration relates to managing of different things.The word "administration" comes from

word "minor" and "ministrare" which means " to serve" and " to govern" accordingly. It is a
top level activity, above the management. It deals with executive and strategic work. Thus, it
must incorporate both leadership and vision
• Administrating means directing, superintending the execution, using or conducting of various
things. It means, that administration involves setting and following instructions and service.
Which relates to setting up objectives and crucial policies of every organization.
• The administration is focused on the planning and organizing of functions as well as
administrative qualities.
• So, in summary:
• Both administration and management are key managerial activities in the company.
Administration sets up plans and strategy which are executed in the management process.
Administration is a decision-making function, while management is an executive function.
Management is focused on "doing" because managers get work done under their supervision,
while the administration is focused on "thinking" because it is determining the plans and
policies.
What is Management
• Definition of Management :
• Management is defined as an act of managing people and their work, for
achieving a common goal by using the organization’s resources. It creates an
environment under which the manager and his subordinates can work together
for the attainment of group objective. It is a group of people who use their skills
and talent in running the complete system of the organization. It is an activity, a
function, a process, a discipline and much more.
• Planning, organizing, leading, motivating, controlling, coordination and decision
making are the major activities performed by the management. Management
brings together 5M’s of the organization, i.e. Men, Material, Machines,
Methods, and Money. It is a result oriented activity, which focuses on achieving
the desired output.
What is Management
• Broadly speaking management is focused on managing resources, in particular

people, and how they are utilized by an organisation in order to achieve a common
goal or outcome.
• Essentially a Manager works in an environment where they need to
pool resources together, such as people, plant or equipment, financial resources and
industry knowledge into a cohesive unit that has the capability to achieve this goal.
• Functioning more as a coordinator Managers have to often juggle the competing
priorities of various stakeholders, limited or hard to attain resources, all while taking
account of competition and changing market conditions, to achieve a positive
outcome.
• Beyond this process of management, there is also the human element that brings with
it emotions, relationships, desires and fears that all need to be managed. As can often
be seen in sporting teams, you can have all the right players on the field, but that still
doesn’t guarantee a positive outcome if the mindset isn’t right.
• This deficit in a managers ability to coordinate their human capital can manifest itself
in a lack of direction, poor planning or control, and a decrease in motivation.
What is Administration
• s we have see management is focused largely getting things done. While there is process involved in the
management and coordination of resource this is more often an art rather than a science.
• The “science” of business is however more evident in the administration of business. Essentially administration is
concerned with the process around which a business operates. So while a Manager may be responsible for hitting a
given revenue target, the administration of that goal would focus on how sales opportunities are managed, forecast
and eventually closed.
• Similarly, a Manager may be responsible for the hiring and firing of people on their team. The administration of that
role, especially if the company is of sufficient size, is often handled by an administrative focused person in Human
Resources. I.e. there is a policy or procedure that will be followed that instructs them how the company should
operate when making these decisions.
• As you can see administration is the establishment of procedures, policies, plans, objectives, goals and enforcing
not only rules but also regulations. It comes up with an important organizational framework through which the
organization management functions. And this is where the relationship between management and administration
exists.
• In fact, in some smaller organisations you can have a Manager who switches, albeit subconsciously from being a
Manager i.e. leading and motivating their team, to an administrator, i.e. developing and then following the policies in
place when hiring or firing staff.
• To understand the differences between management and administration further we will now look at some of the key
differences between the two.
• we have seen that management is focused largely getting things done. While there is process involved in the
exists.
• we have seen that management is focused largely getting things done. While there is process involved in the
exists.
• Definition of Administration :
• The administration is a systematic process of administering the management of
a business organization, an educational institution like school or college,
government office or any nonprofit organization. The main function of
administration is the formation of plans, policies, and procedures, setting up of
goals and objectives, enforcing rules and regulations, etc.
• Administration lays down the fundamental framework of an organization, within
which the management of the organization functions.
• The nature of administration is bureaucratic. It is a broader term as it involves
forecasting, planning, organizing and decision-making functions at the highest
level of the enterprise. Administration represents the top layer of the
management hierarchy of the organization. These top level authorities are the
either owners or business partners who invest their capital in starting the
business. They get their returns in the form of profits or as a dividend.
Key Differences Between Management & Administration
• he differences between management and administration can be very broad

and hence one needs to pay close attention to details. Below are some of the
differences you can expect:
• Management consists of actions and plans whereby administration entails setting
objectives and policies.
• Management aims at managing not only people but also their work. Whereas
Administration focuses on how best the resources of an organization can be utilized.
• Administration typically has a role in all management decisions, whereas not all
administrative decisions require the input of management.
• Administration is focused on setting and creating policies and procedures.
Management however is more likely to deal with the broader functions of an
organisation and how tasks are executed.
• Administrative functions typically are more defined, whereas how managers act and
operate in an organisation can differ person to person.
Key Differences Between Management and Administration
The major differences between management and administration are given below:
1.Management is a systematic way of managing people and things within the organization. The administration is defined as an act of
administering the whole organization by a group of people.
2.Management is an activity of business and functional level, whereas Administration is a high-level activity.
3.While management focuses on policy implementation, policy formulation is performed by the administration.
4.Functions of administration include legislation and determination.
Conversely, functions of management are executive and governing.

5. Administration takes all the important decisions of the organization while management makes decisions under the boundaries set by the
administration.
Key Differences Between Management and Administration
The major differences between management and administration are given below:
6.A group of persons, who are employees of the organization, is collectively known as management. On the other hand, administration
represents the owners of the organization.
7.Management can be seen in the profit making organization like business enterprises. Conversely, the Administration is found in
government and military offices, clubs, hospitals, religious organizations and all the non-profit making enterprises.
8.Management is all about plans and actions, but the administration
is concerned with framing policies and setting objectives.

9. Management plays an executive role in the organization. Unlike administration, whose role is decisive in nature.
10. The manager looks after the management of the organization, whereas administrator is responsible for the administration of the
organization.
11. Management focuses on managing people and their work. On the other hand, administration focuses on making the best possible
utilization of the organization’s resources.
• The management style of an organisation can also change with the removal or
installation of a new Manager/Leader. Administrative policies or procedures
however are slower to change and may remain in place for many generations of
management.
• The administrative functions of a business can often be guided or influenced by
legislation or law. Whereas how a manager chooses to guide or lead their team is
often a function of their experience and the company culture.
• These are some of the core differences between management and
administration. It is however common to find examples in different roles
and industries where the two are more likely to overlap or co-exist.
• However by understanding the core differences and when you are
expected to manage vs administer policies or procedures can help frame
how you act and operate within your organisation..
Basis For Comparison Management Administration
Meaning An organized way of The process of administering an

managing people and organization by a group of people is
things of a business is known as is called the administration
called the Management
Authority Middle and lower level Top level O

P
Role Executive Decisive
Applicable to Profit making organizations: Governments, Military, clubs business:

business organizations enterprises, hospitals, religious and
educational organizations
Work Putting plans and policies in Formulation of plans, framing policies and
actions setting objectives
Conclusion
• Conclusion:
• Theoretically, it can be said that both are different terms, but practically, you
will find that the terms are more or less same. You would have noticed that a
manager performs both administrative and functional activities. Although the
managers who are working on the top most level are said to be the part of
administration whereas the managers working on the middle or lower level
represents management. So, we can say that administration is above
management.
Classical Theory of Management – Henri Fayol
• Henry Fayol, also known as the ‘father of modern management theory’ gave a new perception of the concept
of management. He introduced a general theory that can be applied to all levels of management and every
department. The Fayol theory is practised by the managers to organize and regulate the internal activities of an
organization. He concentrated on accomplishing managerial efficienche fourteen principles of management
created by Henri Fayol are explained below.
• 1. Division of Work-
• Henri believed that segregating work in the workforce amongst the worker will enhance the quality of the
product. Similarly, he also concluded that the division of work improves the productivity, efficiency, accuracy
and speed of the workers. This principle is appropriate for both the managerial as well as a technical work
level.
• 2. Authority and Responsibility-
• These are the two key aspects of management. Authority facilitates the management to work efficiently, and
responsibility makes them responsible for the work done under their guidance or leadership.
• 3. Discipline-
• Without discipline, nothing can be accomplished. It is the core value for any project or any management. Good
performance and sensible interrelation make the management job easy and comprehensive. Employees good
behaviour also helps them smoothly build and progress in their professional careers.
• 4. Unity of Command-
• This means an employee should have only one boss and follow his command. If an employee has to follow
more than one boss, there begins a conflict of interest and can create confusion.
• 5. Unity of Direction-
• Whoever is engaged in the same activity should have a unified goal. This means all the person working in a
company should have one goal and motive which will make the work easier and achieve the set goal easily.
• 6. Subordination of Individual Interest-
• This indicates a company should work unitedly towards the interest of a company rather than
personal interest. Be subordinate to the purposes of an organization. This refers to the whole
chain of command in a company.
• 7. Remuneration-
• This plays an important role in motivating the workers of a company. Remuneration can be
monetary or non-monetary. However, it should be according to an individual’s efforts they have
made.
• 8. Centralization-
• In any company, the management or any authority responsible for the decision-making process
should be neutral. However, this depends on the size of an organization. Henri Fayol stressed on
the point that there should be a balance between the hierarchy and division of power.
• 9. Scalar Chain-
• Fayol on this principle highlights that the hierarchy steps should be from the top to the lowest.
This is necessary so that every employee knows their immediate senior also they should be able
to contact any, if needed.
• 10. Order-
• A company should maintain a well-defined work order to have a favourable work culture. The
positive atmosphere in the workplace will boost more positive productivity.
• 6. Subordination of Individual Interest-
• This indicates a company should work unitedly towards the interest of a company rather than
personal interest. Be subordinate to the purposes of an organization. This refers to the whole
chain of command in a company.
• 7. Remuneration-
• This plays an important role in motivating the workers of a company. Remuneration can be
monetary or non-monetary. However, it should be according to an individual’s efforts they have
made.
• 8. Centralization-
• In any company, the management or any authority responsible for the decision-making process
should be neutral. However, this depends on the size of an organization. Henri Fayol stressed on
the point that there should be a balance between the hierarchy and division of power.
• 9. Scalar Chain-
• Fayol on this principle highlights that the hierarchy steps should be from the top to the lowest.
This is necessary so that every employee knows their immediate senior also they should be able
to contact any, if needed.
• 10. Order-
• A company should maintain a well-defined work order to have a favourable work culture. The
positive atmosphere in the workplace will boost more positive productivity.
• 11. Equity-
• All employees should be treated equally and respectfully. It’s the responsibility of a
manager that no employees face discrimination.
• 12. Stability-
• An employee delivers the best if they feel secure in their job. It is the duty of the
management to offer job security to their employees.
• 13. Initiative-
• The management should support and encourage the employees to take initiatives in an
organization. It will help them to increase their interest and make then worth.
• 14. Esprit de Corps-
• It is the responsibility of the management to motivate their employees and be supportive
of each other regularly. Developing trust and mutual understanding will lead to a positive
outcome and work environment.
• This 14 principles of management are used to manage an organization and are beneficial
for prediction, planning, decision-making, organization and process management, control
and coordination.
Classical theories- Henri Fayol and Max Weber
Fayol distinguishes between the principles and elements of management.

Principles are the rules and guidelines, while elements are the functions of
management. He has grouped the elements into five managerial functions —
planning,
organizing,
commanding,
coordinating,
and controlling.
His classification is widely accepted.
• Luther Gullick used the acronym POSD CORE—letters of the acronym indicate
different management functions, namely, planning (P), organizing (O), staffing
(S), directing (D), coordinating (CO), reporting (R), and budgeting (B). Reporting
is a part of the control function. Budgeting represents both planning and
controlling. Newman and Summer also classified management processes into
the functions of organizing, planning, leading, and controlling.
• The most useful method of classifying managerial functions is to group them
around the components of planning, organizing, staffing, directing, and
controlling. The above functions of management are common to all business
enterprises as well as to organizations of other fields, but the manner in which
these are carried out will not be the same in different organizations.
• All these functions constitute the job of a manager, and the relative
importance of each of them varies from time to time. Thus, tight economic
conditions may force a firm to lay more emphasis on control for the time being,
while a growing concern may have to devote more time to organizational
problems
Classical theories- Henri Fayol PLANNING
• . Another way of describing the functions of management is to consider it as a

process. As a process, management refers to a series of inter-related functions,
that is, planning, organizing, staffing, leading or directing, controlling, and
coordinating.
• 1. Planning:
• Planning means deciding in advance on what, how, and when something is to
be done. It involves projecting the future course of action for the business as a
whole and also for the different sections within it. Planning is thus, the
preparatory step for actions and helps in bridging the gap between the present
and the future.
Classical theories- Henri Fayol- PLANNING
• Since planning is essentially choosing, it is dependent upon the availability of

alternatives. It is through this process of choosing that decision making can
obviously be seen as an important aspect of planning. Thus, planning is an
intellectual process and signifies the use of a rational approach to finding solutions
to problems.
• In a more concrete sense, the process comprises determination or laying down of
objectives, policies, procedures, rules, programmes, budgets, and strategies.
Management planning might be for a short period and/or for the long run. For
improved efficiency and better results, short-range plans should be properly
coordinated with long-range plans. Planning is a fundamental function of
management and all other functions of management are greatly influenced by the
planning process. The increasing interest evinced in planning amply manifests the
importance of planning in businesses.
• Very often, the planning process is erroneously described as the prerogative of the
top management. But the fact is that planning permeates all levels in an
organization and all managers, irrespective of their position in the management
hierarchy, must plan within the limits of their authority and the decisions of their
seniors.
Classical theories- Henri Fayol-ORGANIZING
• Organizing:
• Organizing is the next function of management. Organizing involves breaking a
plan into activities, grouping those activities, and allocating resources to them.
This is done by structuring the functions and duties to be performed by a group
of people for the purpose of attaining the objective of the enterprise. Functions
and activities of the enterprise depend upon the objectives to be accomplished
and are directed towards fulfilment of such objectives. This necessitates the
establishment of activity-authority relationships in the enterprise.
• More specifically, organization as a function of management involves the
following steps:
• 1. Determination of activities of the enterprise, keeping in view its objectives
• 2. Classification of such activities into convenient groups
• 3. Assignment of these groups of activities to individuals
Classical theories- Henri Fayol- ORGANIZING
• 4. Delegation of authority and fixing of responsibility for carrying out such

assigned duties
• 5. Coordination of these activity-authority relationships throughout the
organization
• Thus, division of work among people and coordination of their efforts to
achieve specific objectives are the fundamental aspects of organization.
Problems related to organizing arise only when group efforts are involved.
Similarly, an organization is always intended to achieve objectives and as such,
it is a means to an end and never an end in itself. Therefore, for better results,
organizations should be based upon practical prudence and sound application
of organizational principles.
Classical theories- Henri Fayol- STAFFING
• 3. Staffing:
• Organization, as a function of management, helps the executives to establish positions and lay
down their functional relations to each other. However, it is through staffing function that
different positions in the organizational structure are manned. The staffing process, therefore,
provides the organization with adequate, competent, and qualified personnel at all levels.
• Since successful performance by individuals largely determines the success of the structure, it
is imperative that the management pays adequate attention to various aspects of the staffing
function. It implies that managers should properly assess the manpower requirements of the
organization, consistent with the qualifications required for proper and efficient discharge of
duties on the existing and possible jobs in the organization, laying down of suitable selection
and placement procedures, developing employee skills through training and appraisal
schemes, and devising suitable schemes of compensation.
• Staffing is a continuous function. A new enterprise employs people to fill up staff positions in
the organization. In an established concern, the deaths/ retirements of employees and the
frequent changes in the objectives and the organization itself make staffing a continuous
function of management.
Classical theories- Henri Fayol- DIRECTING
• 4. Directing:
• Mere planning, organizing, and staffing are not sufficient to set the tasks in motion. Management
has well-coordinated plans, properly established duty- authority relations, and able personnel, yet
it is through the function of direction that the manager is able to make the employees accomplish
their tasks by making them integrate their individual efforts with the interest and objectives of the
enterprise.
• It calls for properly motivating, communicating with, and leading the subordinates. Motivation
induces and inspires the employees to perform better, while through good leadership, a manager is
able to make his subordinates work with zeal and confidence.
• Directing the subordinates embraces three essential activities:
• 1. Issuing orders and instructions
• 2. Guiding and counselling the subordinates in their work with a view to improve their
performance
• 3. Supervising the work of subordinates to ensure that it conforms to orders and instructions issued
Classical theories- Henri Fayol- CONTROLLING
• 5. Controlling:
• While directing, the manager explains to his subordinates the work expected of each of them and
also helps them perform their respective jobs to the best of their abilities so that the enterprise
objectives can be achieved. But even then, there is no guarantees that work will always proceed
according to plan. It is this possibility of actions deviating from plans that calls for constant
monitoring of actual performance so that appropriate steps may be taken to make them conform to
plans. Thus, the controlling task of management involves compelling the events to conform to plans.
• The important steps to be initiated in this direction are as follows:
• 1. Measurement of accomplishments against pre-determined standards and recording of deviations
• 2. Analysing and probing the reasons for such deviations
• 3. Fixing of responsibility in terms of persons responsible for negative deviations
• 4. Correction of employee performance so that group goals are achieved through effective
implementation of plans devised to attain them.
• Control is thus closely related to the planning aspect of the job of a manager. But it should not be
viewed merely as a post-mortem of past achievements and performances. In fact, a good control
system should suggest corrective measures so that negative deviations may not recur in the future.
The principle of feedback when incorporated in the control system can be of great use in this
direction.
Classical theories- Henri Fayol- Coordinating
• 6. Coordinating:
• Coordination, as a separate function of management, has been advocated by many authorities including
Henri Fayol. However, coordination, being all pervasive and encompassing every function of management,
is considered to be more an important managerial essence than a separate management function. Poor
coordination is attributed to failure in performance of all the above-listed management functions.
• Coordination deals with harmonizing work relations and efforts at all levels for achieving some common
purpose. It may be described as unifying and achieving harmony among individual efforts for the purpose
of accomplishing group goals. The whole idea of coordination is to adjust, reconcile, and synchronize
individual efforts so that group efforts become more effective and help to achieve some common
objectives.
• Sometimes coordination is confused with cooperation and it is considered, though erroneously, that if
there is cooperation, coordination will automatically follow. Though cooperation helps to achieve
coordination, it is by no means the sole factor that ensures the achievement of coordination. One can
take the example of a cricket match.
• Without coordinated efforts on the part of the players, it is difficult for the team to win a match.
Coordination is not spontaneous. Differences in approach, understanding, timing, interest, or efforts have
to be reconciled with while synchronizing individual efforts. While managing, a manager coordinates the
work of his or her subordinates.
Classical theories- Henri Fayol- Coordinating
• 1. Coordination should be viewed as the responsibility of every manager right from the bottom to
the top, and he or she must ensure that every individual should know the dominant goals of the
enterprise and also how his or her job contributes towards accomplishing the objectives of the
department.
• Even when a supervisor is able to accomplish the objectives of the department, he or she should be
made to realize that the department’s achievement is nothing unless combined with the achieve
ments of the other units and contributes to attaining the dominant objectives of the organization.
Thus, every manager should understand and appreciate the hierarchy of objectives.
• 2. Individual efforts are more easily synchronized if coordination is achieved in the early stages of
planning and policy making. Thus, where production and marketing policies are at cross-purposes,
coordination between the two groups of activities will be a serious problem.
• 3. Coordination is better achieved through the understanding of interpersonal, and horizontal rather
than vertical relationships of people in the organization or by issue of orders for coordination.
• 4. Another essential requirement is good communication. As a result of constant changes in the
business environment, plans and policies are frequently revised and compromises and adjustments
are made. If the required information is not communicated well in time, unifying individual efforts
made in order to accomplish the goals of the enterprise become difficult.
Fayol's six primary functions of management, which go hand in hand with the
Principles, are as follows:
Forecasting.
Planning.
Organizing.
Commanding.
Coordinating.
Controlling.
Luther Gullick used the acronym POSD CORE—letters of the acronym indicate
different management functions, namely, planning (P), organizing (O), staffing
(S), directing (D), coordinating (CO), reporting (R), and budgeting (B). Reporting is
a part of the control function.
• The principles of management, then, are the means by which you actually
manage, that is, get things done through others—individually, in groups, or in
organizations.
• Formally defined, the principles of management are the activities that “plan,
organize, and control the operations of the basic elements of [people],
materials, machines, methods, money and markets, providing direction and
coordination, and giving leadership to human efforts, so as to achieve the
sought objectives of the enterprise.
• Fayol's "14 Principles" was one of the earliest theories of management to be
created, and remains one of the most comprehensive. He's considered to be
among the most influential contributors to the modern concept of
management, even though people don't refer to "The 14 Principles" often
today
Division of Work – When employees are specialized, output can increase because they become increasingly skilled and efficient.
Authority – Managers must have the authority to give orders, but they must also keep in mind that with authority comes
responsibility.
Discipline – Discipline must be upheld in organizations, but methods for doing so can vary.
Unity of Command – Employees should have only one direct supervisor.
Unity of Direction – Teams with the same objective should be working under the direction of one manager, using one plan. This
will ensure that action is properly coordinated.
Subordination of Individual Interests to the General Interest – The interests of one employee should not be allowed to become
more important than those of the group. This includes managers.
Remuneration – Employee satisfaction depends on fair remuneration for everyone. This includes financial and non-financial
compensation.
Centralization – This principle refers to how close employees are to the decision-making process. It is important to aim for an
appropriate balance.
Scalar Chain – Employees should be aware of where they stand in the organization's hierarchy, or chain of command.
Order – The workplace facilities must be clean, tidy and safe for employees. Everything should have its place.
Equity – Managers should be fair to staff at all times, both maintaining discipline as necessary and acting with kindness where
appropriate.
Stability of Tenure of Personnel – Managers should strive to minimize employee turnover. Personnel planning should be a priority.
Initiative – Employees should be given the necessary level of freedom to create and carry out plans.
Esprit de Corps – Organizations should strive to promote team spirit and unity.
The salient features of management are as follows:
• Management is Goal Oriented: ...

• Management is Universal: ...
• Management is a Continuous Process: ...
• Management is Intangible: ...
• Management is a Social Process: ...
• Management is Multidisciplinary: ...
• Management is Situational: ...
• Management is a Group Effort:
Criticism
• Henri Fayol’s principles of management were originally published in 1916

and the world was a very different place in those days. In today’s world,
there is a much greater reliance on “knowledge workers” and emphasizing
creativity and innovation is very important.
• Creating a “command=and-control” style organization with well-defined
responsibilities and authority, discipline, unity of command, etc. as Henri
Fayol envisioned probably doesn’t work that well today. Organizations today
need to be much more dynamic and flexible to adapt to a very rapidly-
changing environment.
• His principles of management might be somewhat valid today but they are
very crude in today’s environment. For example, in today’s world, there is a
much greater emphasis on “leadership” than on “management” in many
areas. That is also much more consistent with a knowledge-worker
environment.
Theory of Bureaucracy
• According to the bureaucratic theory of Max Weber, bureaucracy is the basis

for the systematic formation of any organisation and is designed to ensure
efficiency and economic effectiveness. It is an ideal model for management
and its administration to bring an organisation's power structure into focus.
• The German sociologist Max Weber argued that bureaucracy constitutes the
most efficient and rational way in which human activity can be organized and
that systematic processes and organized hierarchies are necessary to maintain
• According to Weber, these are the six characteristics of bureaucracy:

• Task specialization (division of labor). ...
• Hierarchical management structure. ...
• Formal selection rules. ...
• Efficient and uniform requirements. ...
• Impersonal environment. ...
• Achievement-based advancement, maximize efficiency, and eliminate
favoritism.
Max Weber listed six major principles of the bureaucratic form as follows:
A formal hierarchical structure – In a bureaucratic organization, each level controls the level below it.
Also, the level above it controls it. A formal hierarchy is the basis of central planning and centralized
decision-making.
Rules-based Management – The organization uses rules to exert control. Therefore, the lower levels
seamlessly execute the decisions made at higher levels.
Functional Specialty organization – Specialists do the work. Also, the organization divides employees into
units based on the type of work they do or the skills they possess.
Up-focused or In-focused Mission – If the mission of the organization is to serve the stockholders, board,
or any other agency that empowered it, then it is up-focused. On the other hand, if the mission is to serve
the organization itself and those within it (like generating profits, etc.), then it is in-focused.
Impersonal – Bureaucratic organizations treat all employees equally. They also treat all customers equally
and do not allow individual differences to influence them.
Employment-based on Technical Qualifications – Selection as well as the promotion of employees is
based on technical qualifications and skills.
most basic elements of
• Summary. Thus, the most basic elements of pure bureaucratic
organization are its emphasis on
• procedural regularity,
• a hierarchical system of accountability and responsibility,
• specialization of function,
• continuity,
• a legal-rational basis,
• and fundamental conservatism
Types
In the U.S. government, there are four general types:
cabinet departments,
independent executive agencies, r
Regulatory agencies, and government corporations.
Bureaucracies have four key characteristics: a clear hierarchy,
specialization, a division of labor, and a set of formal rules, or standard
operating procedures.
Criticism
• Here are some reasons:
• The rules are inflexible and rigid. Further, there is too much emphasis on these rules and
regulations.
• Informal groups do not receive any importance. In current times, informal groups play a huge
role in most business organizations.
• Typically, bureaucracy involves a lot of paperwork which leads to a waste of time, money, and
also effort.
• The rules and formalities lead to an unnecessary delay in the decision-making process.
• While Government organizations can benefit from a bureaucratic structure, business
organization need quick decision-making and flexibility in procedures. Therefore, it is not
suitable for the latter.
• While the technical qualifications of the employee is an important aspect of his promotion, a
bureaucratic organization does not consider the employee’s commitment and dedication.
• There is limited scope for Human Resource management.
• Coordinating and communicating is difficult.
Scientific Management
• A Brief History of Scientific Management Theory
• Federick Taylor became inspired to create his theories while working as an
employee of the United States steel manufacturer, Bethlehem Steel. It was as
that steel company he observed that the managers barely knew anything
about how specific jobs were actually performed.
• He began to design workplace experiments that would influence his famous
principles of management. One experiment involved improving shoveling
efficiency by designing new shovels that were optimized for different materials.
• Another famous example involved using a stopwatch and biomechanical
analysis to concoct a better method for workers to carry pig iron onto railroad
cars.
• On the first day using his new method, the amount of pig iron the workers
were able to transport almost tripled. These and other time and motion
studies became the origins of Taylor’s theory of management.
• A Brief History of Scientific Management Theory
• Although he’s known as the father of scientific management, Federick
Taylor initially called his method “shop management.” He ended up
adopting the term “scientific management” in 1911 after it was
popularized in a court case by future Supreme Court justice Louis Brandeis
with the help of mechanical engineer Henry L. Gantt.
• In 1911 Frederick Winslow Taylor published his monograph “The
Principles of Scientific Management.”
• Taylor argued that flaws in a given work process could be scientifically
solved through improved management methods and that the best way to
increase labor productivity was to optimize the manner in which the work
was done.
• Taylor’s methods for improving worker productivity can still be seen today
at companies, in modern militaries, and even in the world of professional
sports.
• What is Scientific Theory of Management?
• The scientific theory of management focuses on individual efficiency and
productivity. The father of this theory is Fredrick Winslow Taylor (1890-1940), from
his text Principles of Scientific Management (1911). His proposal was to apply
principles of the scientific method to the practice of management. His influence is
such that the scientific theory of management is often referred to as Taylorism.
• What Is Scientific Management?
• Scientific management, also often known as Taylorism, is a management theory first
advocated by Federick W. Taylor. It uses scientific methods to analyze the most
efficient production process in order to increase productivity.
• Taylor’s scientific management theory argued it was the job of workplace managers
to develop the proper production system for achieving economic efficiency.
Although the terms “scientific management” and “Taylorism” are commonly used
interchangeably, it would be more precise to say that Taylorism was the first form of
scientific management.
• 4 Principles of Scientific Management
• Frederick Taylor devised the following four scientific management principles that are still
relevant to this day:
• Select methods based on science, not “rule of thumb.” Rather than allowing each
individual worker the freedom to use their own “rule of thumb” method to complete a
task, you should instead use the scientific method to determine the “one best way” to
do the job.
• Assign workers jobs based on their aptitudes. Instead of randomly assigning workers to
any open job, assess which ones are most capable of each specific job and train them to
work at peak efficiency.
• Monitor worker performance. Assess your workers’ efficiency and provide additional
instruction when necessary to guarantee they are working productively.
• Properly divide the workload between managers and workers. Managers should plan
and train, while workers should implement what they’ve been trained to do.
• What was Taylorism, and how did it give rise to Scientific Management Theory?
• The objective of the scientific theory is to increase production within an organization by
increasing the productivity of the individual.
• Taylor envisioned one best way to perform an organizational task.
• Taylor's research focused on repetitive, routine tasks - rather than complex or problem-
solving activities. Each task was carefully specified and measured.
• If these tasks could be standardized they could be made more efficient. For example, these
types of activities could be largely automated through the introduction of technology.
• Taylor employed timing measures to routine tasks to identify efficiencies and reduce wasted
effort. He also sought to optimize equipment or resources employed in these routine tasks.
By customizing equipment (or technology) he was able to add efficiency to individual effort.
• Further, Taylor proposed an award and punishment system to incentivize efficient practice.
Employees who adapted to efficient techniques were rewarded as a result of higher
productivity. Employees who were unable or unwilling to adapt were punished.
• Taylorism, can be summarized as follows:
• Use the scientific method in planning activities - replace any existing practices or rules of thumb.
• Separate the planning function from the actual work activity.
• Standardize the process, time, equipment, and costs across all processes.
• Workers must be selected and appropriately trained for his/her respective role.
• Time, motion and fatigue figures should be employed to determine the allocation of effort between
workers.
• Cooperate with or facilitate workers in the execution of their responsibilities.
• Work must have functional supervisors who have the knowledge to oversee the respective field of work.
• Responsibilities should be specifically allocated between workers and managers.
• Provide financing incentives as motivation for employee productivity increases.
• As you can imagine, this system is based upon principles of comparative advantage. Individuals are
prepared to perform specific tasks as part of a greater process. This specialization allows for greater
efficiency.
•
• Scientific Management: it’s Definition, Characteristics and Objectives!
• Scientific management implies the application of science to the job
management of an industrial concern. It aims at replacement of
traditional techniques by scientific techniques. Scientific management is a
thoughtful, organized human approach to the job of management as
contrasted with hit or miss, rule of thumb. “It is the art of knowing exactly
what you want men to do and then seeing that they do it in the best and
cheapest way.”
• Scientific management includes finding the most efficient methods of
production, scientific selection and training of worker, proper allotment of
duties and work and achieving cooperation between workers and
management
• Scientific Management: it’s Definition, Characteristics and Objectives!
• “Scientific management is the substitution of exact scientific investigations
and knowledge for the old individual judgment or opinion in all matters
relating to the work done in the shop”. —F.W. Taylor
• The core of scientific management is the organized study of work, the
analysis of work into its simplest elements and the systematic
improvement of the worker’s performance of each element.” —Peter F.
Drucker
• Scientific management characterizes that form of organization and
procedure in purposive collective effort, which rests on principles or laws
derived by the process of scientific investigation and analysis, instead of
any tradition or policy determined casually by the process of Trial and
Error. —H.S. Pearson
• Characteristics of Scientific Management:
• The features of scientific management are as follows:
• (i) It is a systematic approach to handle management problems.
• (ii) It implies scientific techniques in method of work, recruitment,
selection and training of workers.
• (iii) It rejects the age old method of rule of thumb’ or ‘hit or miss’
approach.
• iv) It attempts to discover the best method of doing the work at the
lowest cost.
• (v) It attempts to develop each worker to his greatest efficiency.
• (vi) It involves a complete change in the mental attitude of the workers as
well as of the management.
• Objectives to Scientific Management:
• The objectives or aims of scientific management may be summarised as under:
• (а) Higher Productivity:
• Increase in the rate of production by use of standardized tools, equipment’s, methods and training of
the workers.
• (b) Cost Reduction:
• Reduction in the cost of production by rational planning and regulation, and cost control techniques.
• (c) Elimination of Wastes:
• Elimination of wastes in the use of resources and methods of manufacturing.
• (d) Quality Control:
• Improvement in the quality of output by research, quality control inspection devices.
• (e) Right Men for Right Work:
• Placement of right persons on the right jobs through scientific selection and training of workers.
• (f) Incentive Wages:
• Relating wage payments to the efficiency of the workers, i.e., giving wages at the higher rates to the
efficient workers.
• Scientific Management: Aims and Objectives of Scientific Management!
• The main aim of scientific management is to develop all men to their
greatest efficiency and prosperity. The specific objectives are
• to enhance production and productivity,
• decrease cost of production and
• maximise prosperity both for employer and employees having common
interests (not opposite to each other).
• Scientific management lays importance on the human capital so as to
maximise the advantage to both the management and the workers. It lays
stress on a complete change of mental attitude on the part of
management as well as labour.
•The aims of scientific management may be summed up as follows:
•1. It provides trained minds for attaining a higher degree of excellence in all branches of shop management.
•2. It improves such things as equipment, tools and materials, working conditions and methods of working.
•. It completely revolutionises and improves layout, routine, scheduling, nomenclature, purchasing, store-keeping
and accounting.
•4. A greater correlation between agencies of control makes for dependable operation which protects against
delays, mistakes, accident and neglect.
•5. Its promptness provides timely instructions, constant guidance, immediate goals and prompt rewards.
•6.””Its search for fact and principle tends to eliminate arbitrary rule.
•7. It displaces custom, guess work, and arbitrary exaction. It defends the worker against soldiering and sloth
(shirking work or lazing-away), or over speeding and fatigue.
•8. The high task standards characteristic of it automatically sorts workers to the level of their occupations; while all
are educated and energised.
•9. By adherence to high standards of performance throughout, for management and men alike, it becomes a
possible agency for raising wages, shortening hours, increasing profits and reducing prices to consumers.
•10. Finally, as a section of economic thinking, scientific management is a lays emphasis stating that only by an
increase of production alone, great prosperity be achieved for all classes.
• In simple words, the aims and objectives of scientific management may be
summarised as below:
• 1. To achieve higher production and acceleration in the rate of productivity by
the use of standardized tools, equipment’s and methods.
• 2. Betterment in the quality of the products by research, quality control and
effective inspection.
• 3. Decrease in the cost of production by systematic planning, regulation and cost
control techniques.
• . Avoidance of wastage in the use of resources, time and method of production.
• 5. Placement of the right person on the right job through scientific selection and
training.
• 6. Setting-up a sound system of wage payment so as to attain maximum
efficiency.
• 7. Ensuring a regular supply of goods to the consumers at reasonable prices.
• What are the negative aspects of Scientific Management Theory?
• Taylor's principles functioned well for routine tasks, such as assembly lines
or production facilities. These principles did not function as well in
organizations where knowledge and decision-making are central at each
level of the value delivery process. This is particularly true for service-based
(rather than product-based) industries.
• Further, Taylor's principles garnered significant criticism for their effect on
workers. Many argued that it treated humans as beasts of burden,
dehumanizing them. It often leads to poor working conditions in which
employers reaped greater benefits while employees earned very small
increases in compensation.
• While the scientific theory focused exclusively on efficiency, it did little to
understand the employee or to develop the manager as a leader. Naturally,
these shortcomings lead to subsequent innovations in management theory.
• Who are the Major Contributors to Scientific Management Theory?
• As discussed, Frederic Taylor was the father of Scientific Management Theory. Other major contributors to
scientific theory or management include:
• Henry L. Gantt (1861-1919) - Gantt was an industrial and mechanical engineer who focused on project
efficiency. He developed a series of charts that have become important tools in management practice. He
linked manager performance and benefits to the ability to effectively train employees to be more
productive. He also believed that businesses have a social obligation to improvise the welfare of the
society in which it operates.
• Carl G. Barth (1860-1939) - Barth was an engineer and mathematician. He was an advocated and educator
on scientific method. He is best known for improving upon the slide rule for use in industrial operations.
• Horace K. Hathaway (1878-1944) - Hathaway was perhaps the most successful practitioner of Taylors
methods. He also contributed greatly to scientific method by writing extensively on the implementation of
these methods in various areas of the organization. The topics of his writings include: executive functions,
research organization, business development and sales, manager responsibilities, financial statements,
budgetary controls, comptroller functions, and internal auditing.
• Morris L. Cooke (1872-1960) - Cooke was a practitioner of scientific management theory who worked
closely with Taylor. He implemented these principles in several government and private industry positions
in the areas of residential electricity, labor-management relations, and land and water resource
conservation. He wrote a text, Industrial Management (1907) that strongly influenced Taylor.
• Who are the Major Contributors to Scientific Management Theory?
• As discussed, Frederic Taylor was the father of Scientific Management Theory. Other major contributors to
scientific theory or management include:
• Sanford E. Thompson (1867-1949) - Thompson was an academic and practitioner who worked closely with
Taylor. He focused specially on efficiency through time studies and tool development. With Taylor, he co-
wrote Concrete Costs (1912) which focused on breaking manual labor tasks into comparable time units.
• Frank B. Gilbreth (1868-1924). F. Gilbreth's performed early work on on "motion study. He integrated his
working into scientific management study to focus on efficiency and standardization of task performance in
organizations - particularly factories.
• Dr Lillian Moller Gilbreth (1878-1972) performed early micro-motion studies. These studies furthered
Taylors time studies by employing cameras to record micro-movements. L. Gilbreth also devoted herself to
the study of individual psychology within the organization.
• Harrington Emerson (1853-1931) - Emerson was an efficiency engineer and management consultant. He
employs a form of the scientific approach to manage that he labeled Efficiency Management. While he
never worked with Taylor, his principles of efficiency closely matched this of Taylor. He added elements of
functional management through the idea of the line and staff organization. This model used a staff to advise
a single line manager. This manager would then direct the work efforts of line subordinates. He also
developed a compensation system that based employee compensation on efficiency percent. Basically,
employee efficiency is compensated based upon task completion - either higher or lower than expectations.
• Time Studies vs. Motion Studies: How Are They Different?
• Both time studies and motion studies are business efficiency techniques
developed in the late nineteenth and early twentieth centuries to improve
mass production. While mechanical engineer Frederick Winslow Taylor
devoted most of his work to time studies, efficiency and industrial
engineering experts Frank and Lillian Gilbreth focused on motion studies.
Taylor’s work focused mainly on reducing process time, while the
Gilbreths’ work optimized processes by reducing the amount of motions
involved. Here’s a more in-depth look at each study type:
• Time studies: Taylor thought reducing the time to complete a task was the primary
way to increase labor productivity. He advocated for conducting time studies
wherein he would divide work into specific tasks, use a stopwatch to time each
element of the task, and then reorder the elements into an optimal sequence.
Taylor’s time studies emphasized maximizing profit.
• Motion studies: Rather than only using a stopwatch to time workers, the Gilbreths
advocated for filming workers (using a 35mm hand-crank camera) in order to have
a visual guide of how a task was completed. This way they could not only track the
time it took to finish the task but also analyze areas for improvement. Additionally,
the films could even be shown to workers so they could see firsthand how they
could enhance their techniques. The Gilbreth’s motion studies placed a much
higher emphasis on worker well-being than did Taylor’s principles. After Taylor’s
death, this key variation ended up causing many disputes between the Gilbreths
and other Taylorist thinkers
• Taylorism vs. Fordism: What’s the Difference?
• Fordism describes the method of mass production using assembly line
technology that was invented in the early twentieth century by
mechanical engineer and Ford Motor Company founder Henry Ford.
Frederick Taylor actually coined the term “Fordism” when he accused Ford
of removing the pride that human beings took in their jobs and creating a
labor force of unskilled workers who were merely cogs in the machine. It’s
often assumed that Taylorism was a starting point for the manufacturing
processes developed by Ford, but it’s more likely that any influence on
Ford from Taylorism was mostly coincidental.
• Taylorism vs. Fordism: What’s the Difference?
• Fordism describes the method of mass production using assembly line
technology that was invented in the early twentieth century by
mechanical engineer and Ford Motor Company founder Henry Ford.
Frederick Taylor actually coined the term “Fordism” when he accused Ford
of removing the pride that human beings took in their jobs and creating a
labor force of unskilled workers who were merely cogs in the machine. It’s
often assumed that Taylorism was a starting point for the manufacturing
processes developed by Ford, but it’s more likely that any influence on
Ford from Taylorism was mostly coincidental.
Management theories: Human Relations School by Elton Mayo
• What is Elton Mayo known as the father of?
• Elton Mayo is widely regarded as the “father of the human relations movement,” as well as the
“father of HR” Mayo was involved in several scientific studies of organizational psychology in the
early twentieth century, including the Philadelphia Spinning Mill Studies and the Hawthorne
Experiments, which were influential in the development of corporate culture in the US.
• Broadly speaking, Elton Mayo’s management theory promotes the hypothesis that workers are
motivated by social and relational forces more than financial or environmental conditions. 1It
holds that managers can increase productivity by treating employees as unique individuals rather
than interchangeable cogs in a machine.
• Many of the theories associated with or popularized by Elton Mayo — broadly known as
Human Relations theories — are still applicable today.
• In fact, they have seen renewed popularity with large tech companies like Cisco and Google, as
“humane” and individual-centered workplace environments have overtaken rigid, industrial
corporate hierarchies in popularity
• What are Mayo’s most famous studies?
• While Elton Mayo performed a number of studies throughout his career,
two Human Relations theories were particularly important to the field of
Management:
• The Philadelphia Spinning Mill Studies; and
• The Hawthorne Experiments.
• The Philadelphia Spinning Mill Studies
• After having studied shell shock, Mayo saw an analogy between the cause of
“war neurosis” and the high level of industrial unrest in Australia. He argued
that “the worker’s morale depended on his perception of the social function of
his work” and issues could be resolved via effective industrial management.
• Using the aforementioned analogy, he started making a series of changes to
the department’s working conditions. In turn, these changes—introducing and
modifying rest breaks in particular—produced incremental improvements to
productivity and morale, eventually resulting in a turnover rate that matched
the company’s average after only one year.
• It was at this point in history when Mayo became world-famous. While it
would later be determined that the rest breaks were only a partial contributor
to the improvements, his discovery that improving working conditions could
increase motivation and productivity marked the beginning of a major shift in
Management Theory.
• The Hawthorne Experiments
• Having just seen it work in practice at the Philadelphia Spinning Mill, Mayo was given another
opportunity to test his theory that improved working conditions will produce motivated and
productive employees. This time, he was sought by Western Electric Company’s Hawthorne
Works in Cicero, Illinois, to aid them in their goals to “inspire company loyalty, discourage high
employee turnover and unionization, and present a good face to the public.”
• These studies, known as the Hawthorne Experiments, began in 1924 with illumination tests
that “set out to determine the effects of lighting on worker efficiency.” After those tests had
been completed in 1927, new studies began, this time examining the impact of factors like rest
periods and work hours on production levels.
• One study where five women assembled relays (electromagnetic switches for telephones) had
positive results, but the researchers were unsure which changes to the working conditions —
breaks, shorter working hours, incentives, group design, and increased attention — were
producing those results. It was at that point in 1928 when Mayo and his colleagues, most
notably Fritz Roethlisberger, were brought in to provide assistance.
• The Hawthorne Experiments
• A first group of discoveries Mayo had made revolved around what they had been brought in to determine: the
cause of the relay assemblers’ increased productivity. Mayo determined that the productivity increased
significantly over time because:
• 1. the individuals formed a cohesive and enthusiastic team; and
• 2. these group conditions increased both job satisfaction and cooperation with the experiment.
• A second group of discoveries were found during interviews originally planned to gather details about
employees’ life situations and their impact on attitudes towards work. After changing from a directed to a
nondirected format, interviews grew from around 30 minutes to up to two hours, instead serving as an emotional
release and an opportunity to gather substantial data on the attitudes of industrial workers during those times.
• From this data, Mayo and Roethlisberger discovered the importance of supportive and participative leadership,
interpersonal relationships, and social cohesion in the workplace and used this knowledge to help develop some
of the earliest attempts at personnel policies, supervisory training, and an employee counseling program.
• A third group of discoveries came from the “Bank Wiring Room Study.” This time, a group with bad behaviors—
like intentionally limiting production and ostracizing/hitting workers who were more productive—was studied in
order to determine what was causing the behavior. From this study, Mayo determined that cliques form in
organizations, enforce informal rules within them, and can work with or against management depending on its
attitudes.
• What are Mayo’s management theories?
• The following are Elton Mayo’s management theories and related prescriptions that come from the
Hawthorn and Philadelphia studies:
• Industrial problems are primarily caused by human and social factors.
Human Relations is the main way to resolve industrial problems (but technical efficiency via Scientific
Management is also important).
• Workplace rules and procedures influence workers’ attitudes.
• Workers’ attitudes determine the characteristics of and informal rules within workplace social groups.
• Interactions with supervisors and coworkers can cause stress and fatigue.
• If group attitudes are negative, informal rules can take precedent over formal rules, in turn negatively
impacting production.
• A lack of attention paid to workers can result in intentional underproduction. Workers should be given an
appropriate amount of attention by managers and supervisors.
• Job satisfaction, group dynamics, and individual and group attitudes toward work all have a strong influence
on motivation and productivity (but physical working conditions and incentives are still relevant and
important).
• What are Mayo’s management theories?
• Increased communication and cooperation improves group cohesion.
Managers and supervisors should be trained to be effective listeners and communicators/interviewers in order to
understand and address the personal and social problems of workers. Moreover, they should use these skills at
all times.
• Job satisfaction, motivation, and productivity depend more on recognition, involvement, and cooperation than
physical working conditions.
In order to increase job satisfaction, motivation, and productivity, employees should be given:
• Opportunities to discuss their personal and work-related problems;
• Opportunities to express their opinions;
• Opportunities for social interaction and team building;
• More freedom to determine their own working conditions; and
• The ability to set their own standards of output.
• Management can ally with workers to the detriment of the organization.
Managers must also agree with workplace rules, procedures, and conditions in order to work in the
organization’s best interests.
• What about the “Hawthorne Effect”?
• The “Hawthorne Effect” states that subjects of behavioral studies change
their behavior if they know they’re being observed. While this realization
came from the Hawthorne Experiments, in which Elton Mayo was
involved, Fritz Roethlisberger and William Dickson were responsible for
publishing the observation and its resulting lessons.
• Features of Elton Mayo’s Human Relations Approach:
• The main features of the Human Relations Approach to management are the following:
• (a) Since management is getting things done through and with people, a manager must
have a basic understanding of human behaviour in all respects—particularly in the context
of work groups and organisations.
• (b) The managers must study the inter-personal relations among the people at work.
• (c) Larger production and higher motivation can be achieved only through good human
relation.
• (d) The study of management must draw the concepts and principles of various behavioural
sciences like Psychology and Sociology.
• Contribution of Elton Mayo to Management Thought:
• George Elton Mayo (1880-1949) was a professor at the Harvard Business
School. He published the books —‘Human Problems of an Industrial
Civilisation’ (1933),
• Social problems of an Industrial Civilisation’ (1945), ‘Training for Human
Relations’ (1949) etc. He conducted the famous ‘Hawthorne Experiments’ at
the Hawthorne plant of the Western Electric Company in the USA during
1927-32 with his associates.
•These experiments are described below:
•1. Illumination Experiments:
•From these experiments, it was revealed that productivity could be increased not only by improving the working en.vironment, but
also through informal social relations among the members of the working group.
•2. Relay Assembly Test Room Experiment:
•In this experiment a small homogeneous working group was constituted. Several new elements were introduced in the work en
vironment such as—shorter working hours, proper rest periods, improved physical conditions, friendly supervision, free social
interaction among the group members, and so on.
•During the period of the experiment, productivity and morale increased. Productivity and morale were maintained even if the im
provements in the working conditions were withdrawn. The researchers concluded that socio- psychological factors such as the
feelings of being important, recognition, participation, informal work group, non-directive supervision etc. held the key for higher
productivity.
•3. Mass Interviewing Programme:
•A large number of workers were interviewed to know their perceptions and orientation on the working life. The results again
confirmed the importance of informal relation, social and psychological needs and their impact on the behaviour of the workers.
•4. Bank Wiring Observation Room Experiment:
•A group of 14 workers was observed with regard to their work behaviour. The observation revealed the informal production norms
set by the workers and the existence of informal relations in the group.
• How do Mayo’s management theories apply to companies today?
• Given that our current work environment is, at least in part, a product of Elton
Mayo’s work, it’s difficult for us not to say that most of his findings seem “obvious.”
• For example, I assume that the overwhelming majority of people would agree that
problems in the workplace are primarily caused by human and social factors.
Likewise, we all know about the effect of working conditions on attitudes and
attitudes on individuals, groups, motivation, and performance. So, while his points
are still correct, many have become comparatively obsolete due to the
developments that came next.
• That being said, since the human condition remains the same, many of his theories
are still relevant today. In particular, we all know that interactions with supervisors
and coworkers can cause stress and fatigue. This is still true no matter the industry
or workplace. Moreover, the same can be said regarding: a) receiving attention from
leaders; b) communication and cooperation’s impact on group cohesion; and c) the
importance of recognition, involvement, and cooperation.
• How do Mayo’s management theories apply to companies today?
• However, we also know that “managers account for at least 70% of variance in employee
engagement3,” yet only 40% of workers feel they’re in “good jobs”4 with “high levels of
satisfaction.” More specifically, only:
• 48% are satisfied with their power to change things;
• 54% are satisfied with the level of their pay;
• 55% are satisfied with their employee benefits; and
• 68% are satisfied with their day-to-day work.
• So, while it’s clear that these lessons are still relevant, it’s equally clear that we haven’t learned
them. Conversely, to give this a more positive spin, this means that there are excellent
opportunities for performance improvement and, in turn, organizational growth. Equally, it
means that you, as a leader, can make a substantial impact if you put in the work!
• Again, while it has been argued that his studies had methodological and ideological biases, it is
clear to me that Management Theory, including the fields of Organizational Behavior and
Organizational Psychology, is in great debt to Mayo’s Human Relations theories. In fact, I’d argue
that we all owe him and his colleagues a great deal of gratitude for their influence on the
improved working conditions that we experience today.
• Mayo believed that workers are not just concerned with money but could
be better motivated by having their social needs met whilst at work
(something that Taylor ignored).
• Mayo introduced the Human Relations School of thought, which focused
on managers taking more of an interest in the workers, treating them as
people who have worthwhile opinions and realising that workers enjoy
interacting together.
• Mayo concluded that workers are best motivated by:
• Better communication between managers and workers
• Greater manager involvement in employees working lives
• Working in groups or teams
• His theory most closely fits in with a paternalistic style of management.
• Key summary for Mayo:
• Workers motivated by having social needs met
• Workers should work in teams
• Managers should have greater involvement in employee's working life
• More two-way communication between managers and workers

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Course outline of Management Theory

• Workplaces depend on the strength of those in management positions. In addition to

• A manager’s primary challenge is to solve problems creatively, and you should

• To be an effective manager, you’ll need to develop a set of skills, including

• Five basic operations of a manager

• 4. Devising systems of measurement

• Managerial roles are specific behaviors associated with the task of

• Types of management styles

• Essential Management Theories

• Management is both an art and a science. The above mentioned points

• Science teaches to ’know’ and art teaches to ’do’. Example. a person

• Management relates to conducting, controlling and taking charge of the course

• Administration relates to managing of different things.The word "administration" comes from

• Broadly speaking management is focused on managing resources, in particular

• he differences between management and administration can be very broad

Conversely, functions of management are executive and governing.

is concerned with framing policies and setting objectives.

Basis For Comparison Management Administration

Meaning An organized way of The process of administering an

Authority Middle and lower level Top level O

Applicable to Profit making organizations: Governments, Military, clubs business:

Fayol distinguishes between the principles and elements of management.

• . Another way of describing the functions of management is to consider it as a

• Since planning is essentially choosing, it is dependent upon the availability of

• 4. Delegation of authority and fixing of responsibility for carrying out such

• Management is Goal Oriented: ...

• Henri Fayol’s principles of management were originally published in 1916

• According to the bureaucratic theory of Max Weber, bureaucracy is the basis

• According to Weber, these are the six characteristics of bureaucracy:

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