BPMN 3103

SEMINAR IN MANAGEMENT THINKING

SEMESTER 1 SESSION 2016/2017 A161
TOPIC 4
MANAGEMENT THEORY BY MAX WEBER VS DEREK
PUGH &THE ASTON GROUP
PREPARED BY :
NUR FATIN HUSNA BINTI MOHD NASIR 230221
NURFASHAATYRA BT SAARI
SYAZWANI BINTI AZMI

230251
230252

PREPARED FOR :
DR. SITI NORASYIKIN BT ABDUL HAMID
DATE OF PRESENTATION : 19 OKTOBER 2016

Introduction
MAX WEBER
Karl Emil Maximilian Weber was born on 21 April 1864
Weber is often cited, withmile DurkheimandKarl Marx,
as
among the three founders of sociology.
He grew up in Germany during the Bismarckian era.
a Germansociologist, philosopher, jurist, andpolitical
economistwhose ideas profoundly influencedsocial
theoryandsocial research
He is considered the father of modern sociology
He contracted the Spanish flu and died in Munich on 14
June 1920.
His manuscript ofEconomy and Societywas left
unfinished; it was edited by his wife and published in
1922.

History Of Management Theory

Bureaucracy Theory
Modern organization theory is rooted in concepts
developed during the beginnings of the Industrial
Revolution in the late 1800s and early 1900s. Of
considerable import during that period was the research
done by of German sociologist Max Weber (18641920).
In 1922, his essay about bureaucracy has been
published in his magnum opusEconomy and Society. It
was Weber who began the studies of bureaucracy and
whose works led to the popularization of this term.
Max believed that bureaucracies, staffed by
bureaucrats, represented the ideal organizational form.
Weber based his model bureaucracy on legal and
absolute authority, logic, and order.

 In Weber's idealized organizational structure,

responsibilities for workers are clearly defined
and behavior is tightly controlled by rules,
policies, and procedures.
Max Weber's theories of organizations, like others
of the period, reflected an impersonal attitude
toward the people in the organization. Indeed,
the work force, with its personal frailties and
imperfections, was regarded as a potential
detriment to the efficiency of any system.
Although his theories are now considered
mechanistic and outdated, Weber's views on
bureaucracy provided important insight into the
era's conceptions of process efficiency, division of
labor, and authority.

Definition of Management Theory

(Bureaucracy by Max Weber)
According to Max Weber, bureaucracy is a particular type of
administrative structure developed through rational-legal
authority.
Easy word to define bureaucracy is a complex means of
managing life in social institutions that includes rules and
regulations, patterns, and procedures that are designed to
simplify the functioning of complex organizations.
Characteristics of bureaucratic organizations:
Clear division of labor
Clear hierarchy of authority
Formal rules and procedures
Impersonality
Careers based on merit

The Application/System of
Management Theory
Weber focused on the idea of a bureaucracy,
which differs from a traditional managerial
organization.
In a bureaucracy, career advancement depends
on technical qualifications judged by an
organization, not individuals.
Weber's studies of bureaucracy contributed to
classical management theory by suggesting that
clear guidelines and authority need to be set in
order encourage an effective workplace.
https://www.youtube.com/watch?v=fss0ALdXqII

Contribution
Traditional
authority
Rationallegal
authority

Charismatic
authority

POWER
AND
AUTHORIT
Y

Traditional authority

Charismatic
authority:

Rational legal
authority:

Where acceptance of those in authority

arises from custom and tradition
It involves loyalty to a manager
because they have inherited the role
from a past generation.
For example butcher shop passed
down from generation to generation
Where acceptance of authority arises
from qualities of the ruler in other
word means having a special quality
capable of inspiring and influencing
people.
Where acceptance arises out of the
office, position of the person in
authority bounded by the rules and
procedures of the organization.
Webers belief that an organisation
based on rational legal authority would
be more efficient, effective and
adaptable.

Criticism of Bureaucratic
The emphasis only on rules and regulations.
There will be unnecessary delay in decision-making due
to formalities and rules of Bureaucratic Organization.
Coordination and communication hampered because of
too much formality and rules.
Bureaucracy involves a lot of paper work and has just
too much level of authority which results in lot of
wastage of time, effort and money. Not ideal for
efficiency.

Because of its too much formality, Bureaucratic approach

is not suitable for business organizations. Bureaucratic
model may be suitable for government organizations.
Too much importance is given to the technical
qualifications of the employees for promotion and
transfers. Dedication and commitment of the employee is
not considered.
Limited scope for Human Resource (HR). No importance
is given to informal groups and neither any scope is given
to form one.
https://www.youtube.com/watch?v=HEo27x3n-tc

Introduction
DEREK PUGH
Derek Pugh were not have the same ideas in mind. Derek Pugh was
born in London on 31 August 1930 and studied psychology at
the University of Edinburgh(1949-53).
After his degree, Professor Pugh was taken on as a research assistant in
Edinburghs Social Sciences Research Centre (1953-56), working on an
analysis of inspection issues within British industry that formed the basis
for his MSc dissertation (1956).
He was then appointed assistant lecturer in public health and social
medicine (1956-57) before moving on to what eventually becameAston
Universityas lecturer in human relations (1957-60), senior research fellow
in the Industrial Administration Research Unit (1960-67) and reader in
industrial administration (1967-68).
Derek Pugh has led the Aston Group to come out with the Organization
Theory that emphasize the area of attributes, motivation, roles structure
and decision making. Aston group have played the roles to study different
areas of research such psychology , political science, economic and
sociology.

The Aston Group

The designation of a group of organizational
researchers who pursued their research
between 1961 and 1970 under the leadership of
Derek S. Pugh.
The official name was Industrial Administration
Research Unit of the Birmingham College of
Advanced Technology. Birmingham College was
renamed to Aston University in 1966.

History of Management Theory

ORGANIZATION THEORY
The Aston Group pioneered works in the area of statistical analysis of
organizations and their functioning.
Contrary to former analysis' which were based on binary factors of
features - such as presence vs. absence - the group expanded the
spectrum to continuous dimensions and achieved a more differentiated
view of their research subject.
This group of researchers, based at the University of Aston, put
forward yet another variation of the contingency theory theme.
They examined the way in which the classical concepts of structure
were applied in different types of organisation.
Taking the concepts of specialisation or division of labour,
standardisation of methods, formal rules, tall structures with many
layers of authority and centralised decision-making, they argued that
there were many possible permutations where each of the these
elements may be athigh or low level.Thus, an organisation may
becentralised or decentralised, formal or informal, etc.

They then considered the application ofthese possible

structural permutations in relation to various other features
of the organisation:
Is it large or small?
What kind of technology does it use?
Who owns it?
What markets does it serve?
They identified the size of the organisation as the most
important factor influencing structure. They concluded that
as organisations grow larger they need to be more
specialised (greaterdivision of labour), more formalised
(more explicit and stricter rules), more
standardised(similar procedures and methods), but less
centralised (greater delegation of decision-making).This
would assist firms to perform well as they grow larger.
Max Weber's conception of bureaucracy is characterized by
the presence of impersonal positions that are earned and

Definition of Management
Theory
(Organizational structure by
Derek Pugh & Aston Group)
Organizational structure refers to the formal

and informal manner in which people, job tasks,

and other organizational resources are
configured and coordinated.
Although organizational structure sounds like a
singular characteristic, it is composed of a
number of dimensions, because there are
multiple ways the employees within an
organization and the job tasks that are carried
out can be structured.
Fundamental Elements of Organizational
Structure
Formalization,

The Application/System of
Management Theory

A key role of organizational structure is its

relationship to organizational strategy.
Depending on an organizations strategy,
certain structures will be more or less effective.
Therefore, matching structure and strategy is
important.
Ultimately, a recursive relationship exists
whereby the effective implementation of
strategy creates an appropriate matching
structure that, in turn, produces outcomes and
processes that support the intended strategy.
Structure is also important because of the
direct and meaningful impact it may have on
valued individual outcomes.
Structure has also been shown to affect

Contribution

Specialization
of functions
and roles

Standardizatio
n of
procedures

Formalization
of documentation

Centralization
of authority

Specialization

An organization with highly structured

activities has many specialized sections
such as buying, training, work study and so on

Standardization

Standardization, which is a count of how many

standard procedures an organization has out of a
set of possible standard procedures.
The qualifier Overall is used to distinguish these
full scales from scales that have fewer items and
focus on just one aspect of the organization. For
example, Recording of Role Performance is those
items from the Overall Formalization scale that
refer to documents to records of inspections,
time spent, work done and so on

Formalization

Formalization, which is a count of how many

documents an organization has out of a set of
possible documents

Centralization

Centralization of decision making and the

autonomy of an organizations decision making
from any owning organization were together
termed concentration of authority.
An organization with concentrated authority
not only has most of its decisions taken at the
top of its own hierarchy but has many
decisions taken for it, over its head, by the
management of another organization of which
it is a wholly or partly owned subsidiary or
subordinate section

Criticism Of Organization
Theory
All the above treated organization as a
closed system.
Did not study the influence of
environment on organization. This
approach is known as structural theory.
It focuses on structure, processes and
principles of organization

Conclusion
Max Webers theory about bureaucracy is built and advocated a
system based on standardized procedures and a clear chain of
command. This mean bureaucracy is the most efficient form of
organization and well defined line of authority with crystal clear rules
and regulations which are strictly followed.
The blueprint of this theory is rationally designed to achieve functional
performance at all levels and every part of the bureaucracy should
contribute to the whole institution.
However, the bureaucracy limits individual freedom and makes it
difficult if not impossible for individuals to understand their activities
in relation to the organization as a whole. Therefore, bureaucracy
applies to an organization which is rigid and formally structure with
lot of characteristics needed in order to run successfully. So we have
to acknowledge that a bureaucratic organisation is not the only way of
rationalising institutions in the modern context.

While organization theory give new perspective of

organization with examine the way in which the classical
concepts of structure were applied in different types of
organisation. Taking the concepts of specialisation,
standardisation of methods, formal rules, tall structures
with many layers of authority and centralised decision
making
Besides that, they also identified the size of the
organisation as the most important factor influencing
structure. They concluded that as organisations grow
larger they need to be more specialised, more formalised,
more standardised, but less centralised.This would assist
firms to perform well as they grow larger.
Both of theory have their own strenghts but organization
must choose or combine this theory that appropriate to
apply in their organization.

EXAMPLE OF BEAUCRACY IN
MALAYSIA

EXAMPLE OF ORGANIZATIONAL
STRUCTURE