PART I: Intro to management

Chapter 2: Models of management

2.1 Introduction
Managers search for ways to manage their enterprises to add value. They make assumptions about the best way to
do things - and through trial and error develop methods for their circumstances.
2.2 Why study models of management?
Model (theory) - representation of more complex reality with focus on the essential elements and their
relationships, and how change may affect it.
- Models identify the variables
The more acurrately the model identify the main variables in a situation and their relationship - the more useful
they are.
- Models suggest relationships
In each area there are models about the variables and their relationships, and about which changes will best add
value. A change in one element affects others.
- Models reflect their context
People look for models to deal with most urgent issues they face.
Critical thinking helps improve our mental models
2.3 The competing values framework
Models of management are grouped according to four underlying philosophies - rational goal, internal process,
human relations and open systems.
Successive models of management complement, rather than contradict each other.
Althought each model adds to our knowlegde, none is sufficient -->framework integrates them by highlighting
their underlying values.
2.4 Rational goal models
Adam Smith (18th century), Scottish economist - study how a pin manufacturer had broken a job previously done,
by one man into several small steps. A single worker now performed one of these steps repetitively - increase in
output.
Frederick Taylor (19/20 century)
(American mechanical engineer)
In his work - a response to the problem of organising factory production efficiently.
His work is associated with the idea of 'scientific management'.
Scientific management - the school of management called scientific attempted to create a science of factory
production.
Focus on the relationship between the worker and the factory production systems that were in widespread use.
He advocated 5 principles:
use scientific methods to find the best way
provide financial incentives
train the worker to follow defined procedures precisely
select best person for the job

 move responsibility for planning and organising from worker to manager

--> believed that efficiency rose if tasks were routine and predictable
*His methods greatly increased productivity and were widely adopted. Aspects of the approach are still common
(work measurement, bonus systems etc.) But, trade unions believed that Taylor's methods increased
unemployment: work on assembly line is boring and alienating, reinforces power of managers over workers, focus
on the individual ingores their social needs.
2.5 Internal process models
Max Weber (19/20 century)
(German social historian)
- drew attention to the significance of large organisations
- observed that bureucracy brought routine to office operations just as machines had to production.
Bureaucracy - system in which people are expected to follow precisely defined rules and procedures rather than to
use personal judgement.
Characteristics of bureaucratic management:
rules and regulations: guide of behaviour - uniform procedures & operations
impersonality: protect from whims - fairness, objective evaluation
division of labour: working on specialised tasks - benefit of easy-learning jobs
hierarchy: jobs ranked vertically by the amount of authority to make decisions - lower position under
control of higher
authority: structure that ties system together - the right to make decisions of varying importance at
different level
rationality: managers should use most efficient methods to achieve objectives
Henri Fayol (19/20 century)
(French engineer)
- developed administrative management
Administrative management - the use of institutions and order rather than relying on personal qualities to get
things done.
He believed managers should use certain principles in their work (should be applied flexibly and in proportion):
division of work
authority and responsibility
discipline
unity of command
unity of direction
subordination of individual interest to general interest
remuneration of personnel
centralisation (degree varies according to different cases)
scalar chain (chain from ultimate authority to lowest ranks)
order (materials should be in the right place to avoid loss, essential posts filled by capable people)
equity
stability of tenure of personnel
initiative (manager must be able to sacrifice some personal vanity in order to grant satisfaction to
subordinate)
esprit te corps (harmony, union among the personnel)
*Methods are widely used in the public sector, and in commercial businesses (hotels, stores, banks).
Critics of bureaucracy: stifles creativity, fosters dissatisfaction, hinders motivation.

Can be slow and inflexible - conditions change more quickly than rules, units of organisation face different
conditions, rules may become more important than adding value.
Others think it brings fairness and certainity to the workplace, clarifies roles and responsibilities, makes work
effetive, so helps motivation.
--> bureaucracy distinguished:
enabling - designed to enable employees to master their tasks
coercive - designed to force emploeyees into effort and compliance
2.6 Human relations models
- a reaction to scientific management and bureaucratic approaches
- focus on people as social beings with many needs
Mary Parker Follet (20 century writer)
- economics, law, philosophy
As social worker she observed creativity of group processes. She advocated replacing bureaucratic institutions by
networks in which people themselves solve problems. The solving problems created integrative unity.
Elton Mayo (20 century writer)
- psychology, logic, ethics, became Professor of Industrial Research
He applied psyhological methods to industrial conflict.
In 1924 managers of Electric Company started series of experiments at their Hawthorne plant in Chicago to test
effect on output of changing defined factors in the physical environment. First experiments studied the effect of
lightning.
Unexpected result stimulated the set up of more comprehensive experiment to identify other factors.
Other Hawthorne study: observing another part of the factory (bank wiring room), which revealed a different
aspect of group working (worker were paid according to the amount for each item they produce).
His reflections on Hawthorne's studies drew attention to aspects of human behaviour that practitioners of
scien.manag. had neglected. He introduced the idea of 'social man' in contrast to 'economic man'.
*Evaluation: influenced many management practices, work-life balance etc.
Aim to integrate needs of individual with needs of the organisation, but this reinforces unequal power relations.
Providing good supervision and decent working environments may increase satisfaction but not necessarily
productivity.
2.7 Open system models
Focus on links with outside world on which firm depends.
Basic idea: thinking of the organisation not as a system, but as an open system.
System - a set of interrelated parts designed to achieve a purpose.
Open system - one that interacts with its environment.
System boundary - separates the system from its environment.
(open system imports resources as energy and materials from the environment through boundary, undergo some
transformation process within the system and leave the system as goods and services)
Feedback - (in systems theory) refers to information about the performance of the system.
(may be deliberate (customer surveys), unplanned (loss of business to competitor)
Subsystems - the separate but related parts that make up the total system.
(education: university - faculty - course)
They interact with each other, and how well people manage these links affects the functionating of the whole
system - change in one will have consequences in other.
Socio-technical systems

--> one in which otucomes depend on the interaction of both the technical and social subsystems.
Work system seen as a combination of a material technology (tools, machinery, techniques) and a social
organisation (people, relationships). Optimising one while ignoring other is likely to be unproductive - each affects
the other, people need to manage both.
Contingency management
The main theme - to perform well, managers must adapt the structure of the organisation to match external
conditions. As the environment becomes more complex, managers can use contingency perspective to examine
what structure best meets the needs of the business.
Complexity theory
Managing complexity arises from feedback between the parts of linked systems.
People in organisations, both as individuals and as members of working relationships react to an event or an
attempt to influence them. That reaction leads to a further response - setting off a complex feedback process.
Feedback system created by successive interactions.
In management, complex systems arise whenever agents (people, organisations, communities) act on the (limited)
information available to them without knowing how these actions may affect other agents, nor how the action of
those agents may affect them.
Complexity theory - concerned with complex dynamic systems that have the capacity to organise themselves
spontaneously.
''Linear'' - system in which an action leads to a predictable reaction.
''Non-linear'' - those in which actions are less predictable.
*Evaluation: Influenced many management practices which stress response to external conditions (market
researches, strategic planning...) May emphasise need for change at the expense of the need for stability and
efficiency. Practice depends on people interpreting events.