Oleh : F.X.

Arief Poyuono/2010010362009 Program Pascasarjana Ilmu Komunikasi Universitas Jayabaya Jakarta 2011

Theory is: a plan or scheme existing in the mind only, but based on principles verifiable by experiment or observation (Funk & Wagnalls page 1302 ).

Organizations are social entities that are goal-oriented; are designed as deliberately structured and coordinated activity systems, and are linked to the external environment (Daft, 2004).

Organization theory: is the set of propositions (body of knowledge) stemming from a definable field of study which can be termed organizations science (Kast&Rosenzweig1970). The study of organizations: is an applied science because the resulting knowledge is relevent to problem solving or decision making in ongoing enterprises or institutions (Kast&Rosenzweig1970).

Two things:
Knowledge
Knowledge generated by practical experience and scientific research

Solving problems & managing resources (Kast&Rosenzweig1970).

It is the application of scientific knowledge in engineering and other forms of technology that has brought such spectacular changes in the material context of our lives over the past century (Kast&Rosenzweig1970).

Management technology stems from organization theory and even more applied in the sense that it focuses on the practice of management in ongoing organizations (Kast&Rosenzweig1970).

Simplifying Assumptions:
Firms viewed as an individual entrepreneur Profit maximization Rationality in achieving firm goals Firms function is to transform inputs into outputs Staple environment in which firm operates Concerned only with changes in prices and quantities of inputs and outputs

Throughout history most managers operated strictly on a trial-and-error basis The management profession as we know it today is relatively new
wide swings in management approaches over the last 100 years parts of each approach have survived and been incorporated into modern perspectives on management

Classical Approaches
1890 1900 1910 1920 1930

Contemporary Approaches
1940 1950 1960 1970

Systematic management
Scientific management

Administrative management

Quantitative management

Systems theory

Contingency theory

Current and future revolutions

Human relations

Organizational behavior

Bureaucracy

Industrial revolution

minor improvements in management tactics produced impressive increases in production quantity and quality economies of scale - reductions in the average cost of a unit of production as the total volume produced increases opportunities for mass production created by the industrial revolution spawned intense and systematic thought about management problems and issues
efficiency production processes cost savings

Key concepts

Systematized manufacturing operations Coordination of procedures and processes built into internal operations Emphasis on economical operations, inventory management, and cost control Beginning of formal management in the United States Promotion of efficient, uninterrupted production

Contributions

Limitations

Ignored relationship between an organization and it environment Ignored differences in managers and workers views

Advocated the application of scientific methods to analyze work and to determine how to complete production tasks efficiently Four principles

Personalities

develop a scientific approach for each element of ones work scientifically select, train, teach and develop each worker cooperate with workers to ensure that jobs match plans and principles ensure appropriate division of labor Frederick W. Taylor Frank and Lillian Gilbreth Henry Gantt

Key concepts

Used scientific methods to determine the one best way Emphasized study of tasks, selection and training of workers, and cooperation between workers and management

Contributions Improved factory productivity and efficiency

Introduced scientific analysis to the workplace Piecerate system equated worker rewards and performance
Simplistic motivational assumptions Workers viewed as parts of a machine Potential for exploitation of labor Excluded senior management tasks

Limitations

Emphasized the perspective of senior managers Five management functions

planning organizing commanding coordinating controlling

Fourteen principles of management Personalities

Henri Fayol Chester Barnard Mary Parker Follet

Key concepts

Fayols five functions and 14 principles of management Executives formulate the organizations purpose, secure employees, and maintain communications Managers must respond to changing developments Viewed management as a profession that can be trained and developed Emphasized the broad policy aspects of top-level managers Offered universal managerial prescriptions

Contributions

Universal prescriptions need qualifications for environmental, technological, and Limitations personnel factors

Aimed to understand how psychological and social processes interact with the work situation to influence performance Hawthorne Studies
Argued that managers should stress primarily employee welfare, motivation, and communication Personalities
Abraham Maslow Hawthorne Effect - workers perform and react differently when researchers observe them

Key concepts

Productivity and employee behavior are influenced by the informal work group Cohesion, status, and group norms determine output Social needs have precedence over economic needs

Contributions social processes influence performance Psychological and

Maslows hierarchy of need Ignored workers Limitations rational side and the formal organizations

contributions to productivity Research overturned the simplistic belief that happy workers are more productive

Bureaucratic structures can eliminate the variability that results when managers in the same organization have different skills, experiences, and goals Allows large organizations to perform the many routine activities necessary for their survival People should be treated in unbiased manner Personalities
Max Weber

Key concepts

Structured network of relationships among specialized positions Rules and regulations standardize behavior Jobs staffed by trained specialists who follow rules Hierarchy defines the relationship among jobs

Promotes efficient Contributions performance of routine operations

Eliminates subjective judgment by employees and management Emphasizes position rather than the person Limited organizational flexibility and slowed decision making Ignores the importance of people and interpersonal relationships Rules may become ends in themselves

Limitations

Teams of quantitative experts tackle complex issues facing large organizations Helps management make a decision by developing formal mathematical models of the problem Personalities
military planners in World War II

Key concepts

Application of quantitative analysis to management decisions

Contributions
Developed specific mathematical methods of problem analysis Helped managers select the best alternative among a set

Limitations

Models neglect nonquantifiable factors Managers not trained in these techniques may not trust or understand the techniques outcomes Not suited for nonroutine or unpredictable management decisions

Studies management activities that promote employee effectiveness

investigates the complex nature of individual, group, and organizational processes Theory X Theory Y
managers assume that workers are lazy, irresponsible, and require constant supervision managers assume employees want to work and control themselves

Personalities
Douglas McGregor

Key concepts

Contributions

Promotes employee effectiveness through understanding of individual, group, and organizational processes Stresses relationships among employees, managers, and work performed Assumes employees want to work and can control themselves Increased participation, greater autonomy, individual challenge and initiative, and enriched jobs may increase participation Recognized the importance of developing human resources

Limitations
Some approaches ignored situational factors, such as the environment and technology

Key concepts

Organization is viewed as a managed system Management must interact with the environment Organizational goals must address effectiveness and efficiency Organizations contain a series of subsystems There are many avenues to the same outcome Synergies enable the whole to be more than the sum of the parts Recognized the importance of the relationship between the organization and the environment Does not provide specific guidance on the functions of managers

Contributions Limitations

Key concepts
Situational contingencies influence the strategies, structures, and processes that result in high performance There is more than one way to reach a goal Managers may adapt their organizations to the situation

Contributions
Identified major contingencies Argued against universal principles of management

Limitations
Not all important contingencies have been identified Theory may not be applicable to all managerial issues

Organizing for customer responsiveness (cont.)

Total Quality Management (TQM) - comprehensive approach to improving quality and customer satisfaction

Baldrige award - given to U.S. companies that achieve quality excellence

characterized by a strong orientation toward internal and external customers involves people across departments in improving all aspects of the business requires integrative mechanisms that facilitate group problem solving, information sharing, and cooperation across business functions

 Create constancy of purpose Dont tolerate delays or mistakes Cease dependencies on mass inspection Dont award business on price tag alone Constantly and forever improve the system of prod Institute training and retraining Institute leadership Drive out fear Breakdown barriers among departments Eliminate slogans, exhortations, and arbitrary targe Eliminate numerical quotas

Organizing for customer responsiveness (cont.)

ISO 9000 - a series of quality standards developed by a committee working under the International Organization for Standardization
intended to improve total quality in all businesses companies that comply with standards entitled to certification

reengineering - revolutionizes key organizational systems and processes

based on a vision for how the organization should run completely overhauls the operation in revolutionary ways

Designers

Producers

Brokers

Suppliers

Distributors

Organizations are open systems

affected by, and in turn affect, their external environments

External environment
all relevant forces outside a firms boundaries relevant - factors to which managers must pay attention two elements comprise the external environment competitive environment - immediate environment
surrounding a firm macroenvironment - fundamental factors that generally affect all organizations

Laws and politics New Entrants Buyers Economy

Suppliers

Organization

Technology Competitive Macroenvironment Environment

Rivals

Substitutes

Social values

Demographics

 The macroenvironment
most general elements in the external environment that can potentially influence strategic decisions all organizations are affected by the general components of the macroenvironment

Laws and regulations

impose strategic constraints and provide opportunities regulators - specific government

The economy

Technology

created by complex interconnections among economies of different countries important elements include interest rates, inflation rates, unemployment rates, and the stock market economic conditions change and are difficult to predict
creates new products, advanced production techniques, and improved methods of managing and communicating strategies that ignore or lag behind competitors in considering technology lead to obsolescence and extinction

Demographics

measures of various characteristics of the people comprising groups or other social units workforce demographics must be considered in formulating human resources strategies
age, gender, family size, income, education, occupation

immigration also is a significant factor

population growth influences the size and composition of the labor force increasing diversity of the labor force has both advantages and disadvantages
must assure equal employment opportunity

Social issues and the natural environment

management must be aware of how people think and behave
the role of women in the workplace providing benefits for domestic partners of employees protection of the natural environment

Competitive environment
comprises the specific organizations with which the organization interacts
Michael Porter - defined the competitive environment

successful managers:
react to the competitive environment; and act in ways that actually shape or change the competitive environment

New entrants

Suppliers

Rival firms

Customers

Substitutes

Competitors
competitors within an industry must deal with one another organizations must:
identify their competitors analyze how competitors compete react to and anticipate competitors actions

competition is most intense:

where there are many competitors when industry growth is slow when the product or service cannot be differentiated

Threat of new entrants

barriers to entry - influence the degree of threat

conditions that prevent new companies from entering an industry include government policy, capital requirements, and brand identification, cost disadvantages, and distribution channels

Threat of substitutes
technological advances and economic efficiencies may result in substitutes for existing products substitutes can limit another industrys revenue potential

Suppliers
provide the resources needed for production powerful suppliers can reduce an organizations profits
international labor unions are noteworthy suppliers

dependence on powerful suppliers is a competitive disadvantage

power of supplier determined by:
availability of other suppliers from whom to buy the number of customers for the suppliers products

switching costs - fixed costs buyers face if they change suppliers

Customers
purchase the products or services the organization offers final consumers - purchase products in their final form intermediate consumers - buy raw materials or wholesale

customer service - giving customers what they want, the way they want it, the first time disadvantageous to depend too heavily on powerful customers
powerful customers make large purchases and/or have other suppliers

products before selling them to final consumers