BMIS 501 Liberty University Executive Leadership and Management Discussion-assign.pdf

BMIS 501

DISCUSSION ASSIGNMENT INSTRUCTIONS

The student will complete 2 Discussions in this course. The student will post one thread of 600-

900 words by 11:59 p.m. (ET) on Thursday of the assigned Module: Week. The student must

then post 2 replies of at least 250-300 words by 11:59 p.m. (ET) on Sunday of the assigned

Module/Week. For each thread, students must support their assertions with at least 3 peer-

reviewed references from the Jerry Falwell Library and 1 reference from the textbook. in APA

format. Each reply must incorporate at least 1 scholarly citation in APA format. Any sources

cited must have been published within the last five years.

Use the following as headings for your Discussion thread:

 Topic Title

o A short overview of the topic

 Three Concepts

o The 3 most important concepts you have learned from the textbook readings,

presentations, and website and article readings.

o In the Discussion, include why these are the most important for an organization to

consider.

 Biblical Integration

o Integrate a minimum of one biblical principle that relates to one or more of your

concepts. Listing a Bible verse alone is unacceptable. Provide a verse or biblical

principle and elaborate how it relates to your topic and today’s current culture.

 References – 4 total

o 3 peer-reviewed references from the Jerry Falwell Library

o 1 reference from the text

Use the following as headings for your Discussion replies:

 Topic Reply

o A Discussion of your thoughts on the other student’s thread.

 Biblical Integration

o Integrate one biblical principle that relates to the other student’s concept. Listing

a Bible verse alone is unacceptable. Provide a verse and elaborate how it relates

to today’s current culture and the topic.

 References – 1 total

o 1 peer-reviewed reference from the Jerry Falwell Library

BMIS 501

SATTERLEE: CHAPTERS 1 – 2 OVERVIEWS

Chapter One provides an introduction to the field of management. The introduction is based on

five essential concepts:

 Management vs. leadership.

 The roles, work, and importance of management.

 The effective vs. ineffective manager.

 The manager’s relationship with organizational constituents.

 Managerial career development.

First, the similarities and differences between management and leadership are discussed as well

as the related concept of followership.

Second, the reader is introduced to the work of management—specifically why managers are

important to the organization—the differing organizational roles managers play, and the general

types of managers.

 The first essential concept focuses on the work and relevance of management to the

organization.

 The second and third essential concept focuses on the relationships of managers within

the organization.

 The fourth essential concept focuses on the skills and characteristics of the effective and

ineffective manager and how they differentiate.

 The fifth essential concept concerns managerial relationships—in terms of the overall

organizational levels, environments, and stakeholders.

The chapter concludes with a discussion of managerial career development.

Chapter Two provides the historical development of the field of management covered in four

essential categories:

 Scientific management theory.

 Administrative management theory.

 Quantitative management theory.

 Modern management “gurus.”

The chapter begins with a summary of the historical development of modern management

thinking, from Adam Smith (1776) through the Industrial Revolution (late 1800s).

Next, the three historical eras of modern theory are discussed, specifically scientific management

(early twentieth century), administrative management (mid twentieth century), and quantitative

management (later twentieth century).

Finally, the chapter concludes with historical development of management gurus, including their

impact on contemporary management thought.

Page 31

The Evolution of

Management Theory

Page 32

INTRODUCTION

The roots of current management practices are found in the historic events

of the past few centuries. This chapter follows the evolution of management

theory from its beginnings in the eighteenth century to modern theories of

today, with changes driven by economic, environmental, political, and

cultural factors. Theorists and innovators met the forces of change by

challenging the status quo and seeking new methods in order to be more

efficient and productive. Management emphasis shifted from one of rules

and authority to industrial psychology, from a focus on production and the

product or service produced to the employee, from a hierarchical

management structure to one that is flat, and from a static organization to

one that is flexible.1

In 1776 Adam Smith (1723-1790) of Scotland published The Wealth of

Nations, a defense of free-market policies, in which the economic focus was

shifted to efficient production through specialized tasks and the division of

labor. At the time of its publication, industry consisted almost entirely of

small farms and home-based factories where owners were trying to earn an

income to support their families. Smith believed that there were two

requirements necessary for work to be productive: the work must create

both a tangible end product and a surplus that would be reinvested in

production.

Smith was the first to recognize the connection between job specialization

and efficiency.2 To explain the relationship, he used as illustration the

manufacturing of pins. While one worker could make only ten pins a day,

Smith concluded that ten workers could produce approximately forty-eight

thousand pins daily if each performed only a specialized task in the

manufacturing process. This illustration emphasized that division of labor

increased an employee’s manual dexterity and speed, resulting in increased

production.

INDUSTRIAL REVOLUTION

The onset of the industrial revolution in eighteenth-century Great Britain

saw the economy move away from an agricultural focus to one of

commerce; it was a time of transfer from human and animal power to

machine power—a time of technological and economic growth. With new

sources of energy, raw materials, and a migration of the population to

urban areas, labor shifted from farms located in rural areas to factories

located in metropolitan areas. Consequently, it was much cheaper to

produce goods in factories than in homes. That shift of workers from small

farms to large factories encouraged economic growth and brought about

new challenges that arose from managing large numbers of employees.

Managers were needed to assign jobs, direct employees, order raw

materials, and coordinate activities across the factory. In other words,

managers were needed to plan, lead, organize, and control a large-scale

operation. As much of the labor focused on repetitive tasks, management

focused on machine-like control of how employees performed their specific

jobs.3 Technological advances during the industrial revolution led to the

invention of specialized equipment and machinery to support mass

production. Invention was not only occurring within the factory. The

invention of the steam engine and its use in steamboats and railroads

allowed quick transport of manufactured goods to consumers.4Page 33

SCIENTIFIC MANAGEMENT

On the heels of the industrial revolution, scientific management emerged in

the latter part of the nineteenth century. Primarily an American trend,

scientific management focused on increased efficiency and productivity of

the individual employee. The replacement of small home-based businesses

with large organizations brought about opportunities, but not without

problems. When the small work shop was replaced with factories, which

employed large numbers of people, those factories were run by managers

who may have possessed technical skills but had no idea how to address

personnel issues that arose. Scientific management utilized scientific

methods to determine the “one best way” for a job to be accomplished, and

all workers were expected to complete their work using the “one best way.”

Frederick W. Taylor

Frederick Winslow Taylor (1856-1915), is considered the father of

scientific management. As an engineer, Taylor established the guidelines

associated with scientific management in his book Principles of Scientific

Management, where he believed that tasks could be planned in such a way

as to increase productivity. Unlike later management theorists, such as

Henri Fayol or Max Weber, Taylor’s interest was in efficiency, not authority.

Taylor studied the different physical motions involved in jobs performed at

Philadelphia’s Midvale and Bethlehem Steel Companies and was shocked at

the inefficiencies of workers performing their jobs. Taylor used time and

motion studies to determine the one best way to complete a task, which

was what he believed to be the most efficient way to complete each job.

Like a cog in a machine, each employee had a specific function. The more

precise the cog, or in Taylor’s case the employee, the better the factory ran.

Taylor believed that successful management entailed sustained

profitability for the employer and substantial wages for the worker. The

goal was for both the employer and the employee to work together to

increase the profitability of the organization. Taylor felt that a manager had

two responsibilities: coordinating employee functions by assigning tasks

and monitoring employees’ work, and providing clearly defined guidelines

for employees to be successful. The guidelines were necessary because

Taylor believed that workers deliberately worked well below their capacity

on the job—a term he called soldiering. To eliminate soldiering, Taylor’s

theory espoused four guidelines that he believed would promote efficiency:

The principles at the heart of scientific management were clear: break jobs

down into their simplest parts; select the most suitable workers to fit the

available jobs; turn those workers into specialists, each an expert in his

own appointed task; arrange these specialized jobs along an assembly line;

and design the right package of incentives (including bonuses and prizes)

to ensure that the workers did indeed work.5

Rules and clearly defined roles were central to scientific management, so

processes were documented as written rules and standard operating

procedures. The responsibility of the manager was to assure that the

worker was appropriately trained to function within the parameters that

had been created. Finally, an established acceptable level of performance,

which was associated with a specific level of pay, had to be set. However,

Taylor believed that pay should be linked to productivity, so workers were

able to earn Page 34 more than those who worked in factories that did not

follow scientific management. Over a number of years, Taylor performed

various experiments to determine the best procedures and methods to

determine the one best way that tasks should be performed and proposed

the following duties for managers:

Principle

Replace ‘rule of thumb’ with ‘one best way’ based upon scientific study of tasks.

Principle

Scientifically select, train and develop workers according to their skill sets that complement the tasks required of the position. Train workers to

function within the rules and standard operating procedures.

Principle

In cooperation with workers, management must ensure that all work is being done according to scientific principles.

Principle

Equal division of work between management and workers. Managers apply scientific management principles and workers perform the tasks.

Scientific management improved productivity, but the application of

Taylor’s guidelines were not always implemented as planned. By the early

1900s, Taylor’s four guidelines were being utilized throughout the United

States to increase efficiency. Organizations raised performance

expectations; but in some cases, management neglected to reward

employees when they exceeded predetermined expectations. Instead of

receiving monetary bonuses, the workers were simply rewarded with more

work and higher expectations. Also, the repetitive nature of the “one best

way” alienated workers and caused a decrease in the skill level of those

who performed the same task day after day. The backlash towards the

implementation of Taylor’s scientific management principles led to his

methods falling out of favor.

Frank and Lillian Gilbreth

Frank (1868-1924) and Lillian Gilbreth (1878-1972) pioneered motion

studies and the psychology of management. They had a large family, and as

parents of twelve children, the Gilbreth philosophy of efficiency carried

over to their personal lives. They separated the home into designated work

centers, and the family recorded and displayed tasks and methods on

charts. Unquestionably unique, two of the Gilbreth children lovingly

commemorated the use of their family as guinea pigs and the household’s

organizational structure in the book, Cheaper by the Dozen.6

The Gilbreths took the job-study ideas of Frederick Taylor to the next level

and worked to eliminate useless effort by studying hand and body motions

that a worker used to complete a task. They studied each movement

performed by a worker as a job was done and then developed a plan to

improve performance by eliminating or moving where tasks fell in the job

process. The Gilbreths reduced all hand motions into eighteen basic

gestures, such as “grasp” and “hold” and named the motions Therbligs.

Therbligs, an anagram of the name Gilbreth, were developed as a system of

categorizing basic tasks within a process and were symbols for a specific

movement or action that a worker would make to Page 35 perform his or

her job. Workers were observed, and every task performed was dissected

into individual movements. The movements were timed, filmed, and

examined—frame by frame—to study every stroke.

Each motion was assigned a Therblig. Each of the eighteen Therbligs was

color coded and associated with a specific icon. An example of the Therblig

is “Search.” “Search” was represented by the color black and associated

with an icon that looked like an eye, which signified the time spent

searching for items to perform a specific task, such as paper, tool, or switch.

The Gilbreths discovered that colors, shapes, and embossed symbols made

finding the items easier. The Therbligs were hand recorded on a

Simultaneous Motion (SIMO) chart, which was the precursor to a flow

chart. The chart was then reviewed to discover easier ways to perform

tasks. The intent of using Therbligs was not to save time but to promote

efficiency and avoid wasted movements.7 Through chart evaluation, the

Gilbreths could eliminate the Therbligs that were unnecessary or

reposition in the flow of the task those Therbligs that decreased efficiency

or caused worker fatigue. By studying the SIMO chart, areas of delay also

became obvious. By streamlining processes in this manner, the Gilbreths

assumed that the process would naturally take less time and decrease

worker fatigue.

ADMINISTRATIVE MANAGEMENT

Administrative management theory is the study of an organization based

on efficiency and effectiveness. Efficiency is measured by how well

resources are utilized to achieve set productivity goals. Effectiveness

measures the appropriateness of the goals set by the organization and how

well the goals are achieved. An organization utilizes efficiency and

effectiveness by measuring performance according to these combined

standards. Businesses continually seek ways to achieve efficient and

effective processes as a matter of competitive survival.

Henri Fayol and Max Weber played important roles in the development of

the theoretical structure of Administrative Management. Administrative

management is different from scientific management. Administrative

management focuses upon concentrating on the efficiency of large numbers

of individuals in an organization, whereas the scientific approach

concentrates on the efficiency of the individual.8

Henri Fayol

Henri Fayol (1841-1925) was a French engineer, the CEO of a mining

company, and is known as the “father of modern management.” After his

retirement in 1916, Fayol published a book in which he utilized his

management experiences to identify four functions and fourteen principles

of management. The functions of management included the processes of

planning, organizing, leading, and controlling, while the principles of

management were intended to be used as guidelines in managerial decision

making and in the development and improvement of management skills.

The fourteen principles are as follows:

1. Division of work increases efficiency by promoting job

specialization. In order for this to be effective, the employee

must not be allowed to become bored with his job and should be

encouraged to assume different responsibilities. Page 36

2. Authority and responsibility are components not only directed to

the manager but also to those employees with informal authority

associated with increased expertise or natural leadership skills.

3. Discipline of employees is an entitlement of leadership and

authority. Employees must obey the rules of the organization.

4. Unity of command means that employees should answer to only

one person in authority. Having more than one authority figure

could lead to disarray and confusion.

5. Scalar chain. (Line of authority) The chain of command should

align from top to bottom and provide a clear hierarchy so all

employees in the organization understand and play their part.

6. Centralization of authority assures that decision making is

centralized at the top of the chain of command.

7. Unity of direction gives the workers and managers a single path to

follow; a single vision.

8. Equity represents the entitlement of all employees to be treated

fairly.

9. Order is the alignment of positions and materials to a specific

place.

10. Initiative is making a plan and acting on the steps required to

carry out the plan.

11. Remuneration of personnel is accomplished through the practice

of provision of fair wages, bonuses and incentives.

12. Tenure of personnel offers job security for good workers by

encouraging skill development to promote retention and

decrease turnover.

13. Subordination of individual interests to the common

interest indicates that the success of the organization is the

primary goal, and all other goals are secondary. When at work,

all thoughts and actions should be focused on work.

14. Esprit de corps is the driving force to camaraderie and

enthusiasm that unifies and energizes the organization.9

Fayol adamantly believed that authority was based on a manager’s position

in the organization, as well as his or her intelligence, performance, and

moral fortitude. His organizational model was depicted “as a pyramid of

people with both personal power and formal rules as principles of

organization.”10 Fayol’s theory is considered controversial because it is not

based upon scientific study but on anecdotes of his own experiences. Many

have challenged his principles because they claim that Fayol thought the

principles were sweeping truths for management; however, Fayol wanted

the principles to be flexible in their application.11

Max Weber

Max Weber (1864-1920) was a German scholar, professor of economics,

and sociologist, who in his book, The Theory of Social and Economic

Organizations, developed a concept of bureaucracy that he considered to be

ideal for large organizations.12 The power behind Weber’s theory was

found in the rules of the organization, which provided structure and

efficiency and defined the power of the manager.13 Over time, Weber’s

strict view of authority and command met with controversy, but

components of the basic structure of bureaucracy have held firm.

Weber’s works became a foundation for current theories regarding

charismatic leadership and the magnetic pull that a charismatic leader has

on followers. According to Page 37 Weber, charisma occurs when there is a

social crisis, a leader attracts followers who believe in the vision, they

experience some successes that make the vision appear attainable, and the

followers come to perceive the leader as extraordinary.14

Weber believed in well-defined rules and a strong hierarchy and supported

his viewpoint with the theory of an ideal bureaucracy. Weber’s bureaucracy

was a set of guidelines intended for large groups rather than individuals

and was divided into division of labor, authority, formal rules,

impersonality, and career orientation.

1. Division of labor assured that the job was done by an expert so

that the end result would be consistent and completed more

quickly and efficiently.

2. Authority assured a clearly defined chain of command.

3. Formal rules assured that employees followed the same pattern of

tasks so that the same level of performance was maintained. The

expectation of compliance to rules was applied to managers as

well as workers.

4. Impersonality removed emotion and camaraderie from the

equation. Rules were equitably enforced, regardless of the

employee’s rank or status so that favoritism held no credence in

the organization.

5. Career orientation designated that company owners should not

manage departments. Instead, that task should be done by

professional managers, hired by the organization.

BEHAVIORAL MANAGEMENT

Behavioral management theory focuses on the behaviors utilized by

managers to motivate employees to work effectively and demonstrate

commitment to the organization’s goals. Behavioral management became

popular in the 1930s following the introduction of industrial psychology,

but the roots can be traced back to the 1800s. Theorists Robert Owen, Hugo

Munsterberg, Mary Parker Follett, Chester Barnard, Elton Mayo, Abraham

Maslow, Douglas McGregor and Chris Argyris are all considered

behaviorists.

Robert Owen

Robert Owen (1771-1858) was a Welsh businessman and factory owner,

noted as a reformer, idealist, and entrepreneur. He married the daughter of

the owner of New Lanark Mills and managed the mill’s operations, where

he worked passionately to improve working hours and overall conditions

for laborers. Owen sought to improve public education (at a time when

many were illiterate), furnish company meals for workers, and provide

organizational support for community programs. One of Owen’s most

exhausting battles was his fight to abolish the use of child labor; he believed

that children should not work in the mills before they were ten-years-old.

He chastised businesses for treating their machines better than their

workers.

Owen’s opinion that labor is a source of wealth and that workers have

certain rights contributed to the labor movement and the development of a

new working class. Owen did not, however, understand or promote class

struggle, feeling that a transformation to a cooperative, egalitarian society

would be peaceful and natural.15 Page 38

Hugo Munsterberg

German-born psychologist Hugo Munsterberg (1863-1916) is considered

the “father of industrial psychology” and a champion for behaviorism. As a

Harvard professor, he identified methods to improve employee selection

through the utilization of psychological testing and the development of the

best training techniques and methodologies for individual motivation. In

1913, he pioneered job analysis based on his study of streetcar operators.16

Munsterberg was able to establish a connection between scientific

management and industrial psychology. He believed that both scientific

management and industrial psychology increased organizational efficiency

through alignment of a worker’s skills with the requirements of a job.

Mary Parker Follett

Mary Parker Follett (1868-1933), a social philosopher and social worker,

based her theories around groups and community. A graduate of Radcliffe

College, her ideas and opinions were well ahead of others of her time.

Follett may be best known for her pursuit of the human relations side of

management. She appreciated the advantages offered through diverse

groups and transferred this to her theory, which attributed the success of

organizations to group interaction, ethics, and teams—as opposed to

hierarchal structures or rules. Follett believed in self-governance in the

workplace and that power is developed and cultivated, not used to control.

Follett believed that individuals control with power because they are too

impatient to wait for the educational process to bring about expertise and

intelligence. In her 1924 book, Creative Experience, she presented her

circular theory of power in which power flows from one individual to

another, not from a hierarchal position but from intelligence and expertise.

As a lecturer and writer, she shared her views on developing a social

conscience in the workplace. Follett compared the workings of an

organization to that of a democratic community that thrived with

cooperative socialization—managers and employees should work together

instead of one giving orders and the other receiving orders. Many did not

readily accept her viewpoints in her lifetime; however, other theorists

elaborated upon them later in the twentieth century. One such person was

Peter Drucker, who discovered Mary Parker Follett’s writings in the 1950s

and found them to be highly influential. Follett’s ideas were visionary and

contributed to the promotion of the concepts of searching for win-win

solutions and appreciation for diverse cultures.17

Chester Barnard

Chester Barnard (1886-1961) worked at American Telephone and

Telegraph and later became the president of New Jersey Bell. The writings

of Max Weber influenced him in his early years, and after Barnard became

familiar with the Hawthorne studies, he took Weber’s theories one step

further by adding human relationship aspects of management to the mix. In

1938, Barnard published The Functions of the Executive, where his

underlying theme was that, “organizations are by nature cooperative

systems but require sensitive management to maintain them in states of

equilibrium.”18 Barnard believed that cooperation is the glue that holds

organizations together and that cooperation was an inherent function Page

39that should be adopted to support an organization’s survival. Barnard

recognized that the structure of an organization is a community of people.

Individuals convene to become groups, and the groups make up the

organization. Managers carry the responsibility of motivating the

individuals and groups to follow a single set of goals for the benefit of the

organization. The leader, then, is responsible to provide training, support,

and employee incentives. Barnard stated in The Functions of the Executive,

I believe that the expansion of coöperation and the development of the

individual are mutually dependent realities, and that a due proportion or

balance between them is a necessary condition of human welfare. Because

it is subjective with respect to both a society as a whole and to the

individual, what this proportion is I believe science cannot say. It is a

question for philosophy and religion.19

In addition to his theory of equilibrium, Barnard was troubled that the life

of organizations was typically short lived, with most organizations lasting

less than a century. He believed that the brevity of an organizational life

cycle occurs because they do not operate efficiently and effectively.

Elton Mayo

Elton Mayo (1880-1949), a Harvard professor and researcher, studied the

effects of groups on individual behavior. Mayo’s studies revealed the

impact of the informal organization—the social groups that exist inside all

organizations. Mayo has been recognized for his research associated with

the Hawthorne Studies of Western Electric in Chicago. The original

experiment was conducted by Western Electric industrial engineers who

studied the effects of the physical environment of the work area on

productivity. The initial experiment was to determine whether the level of

workplace illumination had an effect on worker productivity.

The control group worked in an area where the lighting levels remained

constant. As lighting increased, so did productivity. However, to the

surprise of the researchers, in the experimental group, lighting in the work

area was increased, productivity increased. The result was the same when

the illumination was decreased. Only when the illumination was adjusted to

the level of moonlight was there a decrease in productivity. The results of

the illumination studies baffled researchers and led to the conclusion that

multiple factors influence productivity in the workplace.

Mayo participated in a subsequent, five-year experiment—the Relay

Assembly Test- Room Studies. In this experiment, a research assistant

observed six employees in an area removed from the mainstream employee

population. The experimental group of six workers was segregated from

the rest of the factory, and various changes were introduced: monetary

incentives, refreshments, changes in work hours and rest periods. In almost

every case, productivity improved. Even after the employees returned to

their original work areas, the trend of increased productivity continued.

However, the experimental group differed from the rest of the factory in

that communication was fluid and the group had created a cohesive bond.

Researchers concluded that the recognition of the employees as a select

group and the interpersonal dynamics, combined with a perceived elite

status, led to the increased productivity.20

This groundbreaking study, which established a pattern for the

examination of group behavior, led to a series of studies about the feelings

and attitudes of workers and supervisors in relation to their output.21 Page

Abraham Maslow

Abraham Maslow (1908-1970) is noted for his motivational theory—

depicted as a hierarchy of needs—which he developed in 1943. The needs

are frequently depicted in the form of a pyramid with the lowest motivating

need.

Maslow’s pyramid consists of five levels: physiological, safety, social,

esteem, and self-actualization. The lowest motivational needs are

physiological and are the basic needs— such as food, water, and shelter.

Safety needs are security-oriented in the form of protection from physical

or mental harm. Social needs include emotional stability in the form of

affection and belonging and can be met through family and friends. Esteem

needs include self-respect, autonomy, and recognition and arise from status

and titles. Self-actualization involves meeting one’s potential through the

achievement of a victory or taking on a challenge. Maslow’s hierarchy of

needs is further separated into two levels: lower-order and higher-order.

Physiological and safety needs are categorized as lower-order needs, which

are satisfied through external conditions. Social, esteem, and self-

actualization represent higher-order needs that are satisfied

internally. 22 The theory essentially states that man will be motivated to

embrace the next level of achievement only after meeting the needs of the

current level.23 Although used as the basis for many management decisions,

the hierarchy of needs was not established through any scientific research

but based on anecdotal evidence gathered by Maslow.

Maslow’s Hierarchy of Needs

Clayton Alderfer

Clayton Alderfer (1940-2015) expanded Maslow’s hierarchy into three

needs: existence, relatedness, and growth—the ERG theory. Maslow’s

lower-order needs of physiological and safety were categorized by Alderfer

into Existence needs. Alderfer categorized social needs as Relatedness

needs, while self-actualization and esteem needs were classified as Growth

needs. Unlike Maslow’s theory, Alderfer believed that the hierarchy of

needs did not have to be met sequentially from the lower-order needs to

the higher order, and different levels of needs could be pursued

simultaneously, and the order of the needs could be Page 41different for

different people. So, while Maslow’s needs are based upon a progressive

hierarchy, Alderfer’s ERG theory, with an adaptable order of needs, a

person can be motivated by needs at more than one level at a time.

Douglas McGregor

Douglas McGregor (1906-1964), a social psychologist and professor at

Massachusetts Institute of Technology, was known for his human relations

approach to management. In 1960, McGregor described his theories in his

book, The Human Side of Enterprise. His Theory X and Theory Y are two

methodologies for managing people. Theory X managers assume that

employees are basically lazy, dislike work and responsibility, and will avoid

work whenever possible. According to a Theory X manager, an employee

will function only if threatened or coerced.24 Theory Y managers assume a

positive approach and believe that employees enjoy their work, can be self-

directed, are creative, and will accept and seek responsibility. Theory X

managers rule with an iron hand and allow employees no room for

individualized thought process or innovation—management is all about

control. Conversely, Theory Y managers foster motivation by empowering

staff with the opportunity to assist in decision making. Employees

experience greater autonomy and the manager acts as a facilitator and

advisor, resulting in greater job satisfaction for both. McGregor believed

that the only true management option to follow was Theory Y.

Chris Argyris

Chris Argyris (1923-2013) was an organizational psychologist, former

professor at Yale, Professor Emeritus at Harvard, and author of the

book, Personality and Organization. He proposed that the management

approaches supported by Classical Management theories were not

consistent with the personality of mature adults.25 Argyris argued that

employees who realize their full potential benefit not only themselves but

the organization as a whole. This led Argyris to conclude that the lack of

focus on the employee, the use of autocratic management, and pyramidal

corporate organizational structures hindered intellectual growth and

creativity potential in employees. Argyris suggested that encouragement,

reinforcement, and training opportunities foster growth. Furthermore,

Argyris believed that allowing employees and managers the opportunity to

offer input into decision-making increases job performance and

satisfaction.

As a major influence of the human relations movement, Argyris found that

although many managers stated that they communicated openly, they did

not actually practice an open communication style; thus, their actual

response differed from their espoused response: “When someone is asked

how he would behave under certain circumstances, the answer he usually

gives is his espoused theory of action for that situation. This is the theory of

action to which he gives allegiance, and which, upon request, he

communicates to others. However, the theory that actually governs his

actions is this theory-in-use.”26

Argyris partnered with Donald Schon and proposed the concepts of single

and double-loop learning.27 Single loop learning involves modifying the

actions of individuals or groups as a response to their errors or expected

outcomes. Single-loop learning involves an action and a reaction. In double-

loop learning, the individuals or groups solve complex problems by

modifying the values and norms of the organization.28 Double-loop learning

involves the analysis of why the reaction occurred and uncovers the root

cause of the issue. Page 42To explain, Argyris uses the example of a

thermostat set to sixty-eight degrees. When the room temperature drops

below the setting, the heat turns on. This is a simple example of single-loop

learning. In the case of double-loop learning, several questions would be

prompted: Why was the thermostat set at sixty-eight? Is the house

insulated? Were the doors and windows closed?

QUANTITATIVE MANAGEMENT

Appropriate utilization of resources is pivotal to successful business

management. Quantitative theory, also known as management science

theory, utilizes mathematical processes to assist a manager in planning and

making decisions concerning an organization’s resources. Management

science provides organizations with the decision-making tools to project

fiscal planning, such as production volumes, target markets, and direction

for capital investment. The quantitative processes covered in this chapter

are (a) operations research, (b) mathematical forecasting, (c) inventory

modeling, (d) queuing theory, and (e) simulation.

Operations Research

First utilized during World War II to plan military initiatives, operations

research, also referred to as management science, is used to evaluate all

phases of the operations of industry and the military. Established by the

British in the 1930s and utilized soon thereafter by the United States,

operations research began as a team approach within each branch of the

military. By the 1950s, operations research was taught in universities

across the United States. Technology has promoted wide-scale use of

specialized computer programs to assist in the process and widen the field

from military to medical and broad business usage.

Forecasting is used in strategic planning to project demand for goods or

services based on historical data and a myriad of variables. Components of

forecasting include fixed and variable costs, sales projections, seasonal

variation, projected profit margins, and demand forecasting, which all bring

the attributes of science to the field of management. Some of the variables

that should be considered when forecasting are the current economic

environment, target market, available resources, and whether the product

or service is a luxury or staple. Managerial decisions regarding production

and marketing are based on the results of mathematical forecasting.

Inventory Modeling

Inventory modeling is the process by which the appropriate amount of

inventory required for an organization is available at all times. This means

that enough of a product has been stocked to supply customers without the

cost of storing more than necessary on the shelves. Inventory can be

controlled by automatic delivery, based on normal usage or processes such

as just in time inventory management, which keeps minimum supplies

available to promote optimum usage and decrease capital tied up in slow

moving inventory.Page 43

Queuing Theory

Queuing theory involves the use of mathematical tools, such as models,

theorems, and algorithms to analyze systems to decrease customer waiting

time and costs associated with customer service. The systems are analyzed

under conditions of randomly varying demand. Queuing theory is utilized

where holding patterns or lines of customers may occur due to lack of

control over the demand. This theory requires observation of the process.29

One application of the queuing theory evaluates the average arrival rate of

customers, the amount of time it takes to wait on the customer after arrival,

and the estimated cost of the wait, which determines customer satisfaction

or dissatisfaction. One of the early uses of the theory was to estimate the

number of operators needed to handle manual telephone switchboards.

The average number of calls that arrived during given timeframes was

evaluated, as well as how long it took the operators to connect calls.

Queuing theory is still used today to monitor customer service and estimate

the number of attendants needed, especially in areas where customers

form a line, such as drive through businesses and retail stores.

Simulations

Simulations are management models that are used to test different

solutions under various assumptions through computer programs or role

playing. Simulations are usually based on the systems approach and utilize

groups who converge to practice analytical skills in making managerial

decisions. The participants are challenged to utilize quantitative processes

to make such decisions as future pricing, marketing, product development,

or capital investment.

Simulations can involve role play and group problem solving. Prior to the

simulation, participants are given background information and business

documents. They are assigned roles to enact and make decisions—just as

they would in a real organization. Rather than having role play, computers

can be used to run simulations, as variables can be easily changed for

numerous predictions regarding possible future outcomes.

MODERN MANAGEMENT THEORIES

Modern management theory extends beyond conventional, top-to-bottom

management and focuses on decreasing the number of hierarchical layers

in an organization. Management’s aim is to discover the creative talents in a

worker and cultivate those gifts. Modern management turns to the

employee for input in efficient work processes and utilizes the expertise of

multi-functional groups to develop ideas in the business focus.

Systems Approach

The systems approach to management looks beyond the boundary of the

organization to explain how it interacts with its environment. Systems

theory recognizes that an organization is connected to its larger

environment and is constantly interacting with that environment. Outputs

from the organization and inputs to the organization ultimately affect both

the Page 44organization and its environment. In his 1938 book, Functions

of the Executive, Chester Barnard identified organizations as a sequence of

systems that integrated the efforts of individuals to accomplish a common

purpose.30

A systems approach to management has been defined as “the ability of the

organization in either absolute or relative terms to exploit its environment

in the acquisition of scarce and valued resources.”31 This particular

approach recognizes that corporations do not operate in a vacuum; rather,

they interface with their external environments—suppliers, customers,

cultures, etc.—and form mutually beneficial relationships to produce better

products or services. An organization operating in an open system has four

stages: inputs, transformation, outputs, and feedback. Individuals outside

the organization provide supplies, service, and/or personnel to enable

business operations to function. Tangible output of an organization

generally includes products or services, but output also includes

intangibles such as the organization’s reputation, influence of others, and

knowledge of people or organizations.32

Organizational stakeholders are “persons or groups that have or claim

ownership, rights, or interests in a corporation and its activities, past

present, or future.”33 A stakeholder is an individual or group who has an

effect or is affected by the success of a business enterprise.34 The number of

individuals and groups classified as stakeholders is essentially endless.

Commonly labeled stakeholders are the consumers, employees, suppliers,

special interest groups, political groups, other competing businesses, etc.

Thus, in a systems approach, anyone with whom the organization interacts

is a stakeholder.

One of the more complicated problems facing managers today is the fact

that in an open system, the needs, wants, and demands of every

stakeholder are in a constant state of change due to their interaction with

new information.35 As stakeholder’s expectations change, so do the goals of

the organization. Managers must monitor the satisfaction levels of

stakeholders to enable the best product or service to those who are

invested in a company.

Resource Inputs

The resource inputs that each organization must interface with are

suppliers and the communities in which the organization operates.

Researchers have identified the needs for small and large businesses to

make a profit and be socially responsible. Corporate social responsibility is,

“a company’s commitment to operating in an economically sustainable

manner while recognizing the interests of its

stakeholders.”36 Organizations that are perceived to care about their social

and physical environment are often thought to have a greater identification

with consumers. While countries differ in the amount of governmental

regulation of corporate social responsibility, many corporations have found

it to be good business to be labeled environmentally or socially

sensitive.37 Companies should include corporate social responsibility in its

strategy, because businesses should be accountable for their actions in

society and the environment.

Transformation Process

With the inputs received from the environment, an organization utilizes its

management expertise and technology to add value to the product or

service, converting the inputs into outputs.Page 45

Product Outputs and Feedback

An organization’s output includes not only the product or service produced

but also the financial gains, losses, or reputation that is generated through

the organization’s actions in both the local and global communities.

The final stage of systems theory is the feedback stage. Organizations

obtain feedback from the environment regarding their product or service,

which subsequently affects inputs. Sales and customer opinions are

gathered and evaluated to determine what changes, if any, must be made to

the system.

Although classical management viewed organizations as closed systems,

business organizations cannot operate as such, because closed systems are

self-contained and not affected by events that occur outside of the system.

An organization having any interaction with the environment would be

considered an open system.

An Open System

Contingency Theories

In the early years of management theory, many believed that there was a

single best method for solving issues and motivating employees; however,

new theories have shown that is not the case. In the 1960s, contingency

thinking was introduced and proposed that different people approach

issues with different values and varied levels of expertise and that

organizations vary in size, mission, and overall culture. What motivates one

individual may not motivate another, and what works in one organization

may not work in all organizations. Therefore, contingency thinking does

not have one best solution. The methods used by managers are contingent

upon each situation and dependent upon the characteristics and culture of

the organization. Several theories have been developed regarding

contingency thinking.

Fiedler’s Contingency Model

The first model of situational leadership, in which the success of different

leadership styles depends upon the situation, was the Fiedler Contingency

Model, developed by Fred E. Fiedler (1922-2017).38 Fiedler believed that

leadership effectiveness was dependent upon two factors: the extent of

influence and control held by the leader in the situation and the leader’s

personal style. Fiedler’s Analysis of Situations looked at leader-member

relations, the task structure of the organization, and the power held by the

leader to determine whether a task-motivated leadership style or a

relationship-motivated leadership style would be most effective in each

situation.

Fiedler measured leadership style by using his Least Preferred Coworker

scale (LPC). Each manager considers all of the individuals with whom he or

she had ever worked and completes a questionnaire that describes the

person with whom the manager would least Page 46like to work with a

series of sixteen pairs of opposite characteristics, for example, tense/

relaxed, distant/close. The responses to those answers are summed and

averaged. A low LPC score suggests the manager has a task orientation,

while a high LPC score indicates the manager has a people orientation. The

inference is that specific group types perform better when matched with

specific leadership styles.

According to Fiedler, the effectiveness of a leader is determined by the

degree of match between a dominant trait of the leader and the

favorableness of the situation for the leader. The dominant trait is a

personality factor causing the leader to either relationship-oriented or

task-orientated.39

Fiedler did not believe that a task-oriented leader could be easily

transformed to a relationship focus; therefore, certain leaders were best

suited for certain situations.

Quality Management Gurus

W. Edwards Deming

W. Edwards Deming (1900-1993) is known as the statistical expert who

brought quality to post-war Japan. He was responsible for placing emphasis

on quality instead of quotas to increase production output.40 According to

Deming, organizations must have a defined mission that is clear to all who

work there, as the mission acts as the foundation for the organization’s

purpose. Deming also stated that senior leadership was responsible for

defining the aim and energizing the masses to obtain it.41

The essence of Deming’s quality improvement model is to plan, do, check,

and act (PDCA).42 Many variations on the quality cycle have been proposed,

but all are generally based on this model. The plan phase begins with

identification of the issues. Once the problem is identified, the investigation

begins with the gathering of data. The plan involves identifying underlying

process issues and determining possible solutions to the problem. A test

plan is developed. The next phase, the do phase of the cycle, involves

carrying out the proposed plan. During the check phase, the results of the

pilot are checked for successes and failures. If the plan did not work, the

areas of challenge are reviewed and evaluated. The end result is evaluated

in the act phase, where success is determined or the plan is revised and the

PDCA process is repeated.43

Page 47

Plan

Define the problem.

Gather data.

List possible solutions.

Devise a plan to test the proposed solution.

Activate the plan.

Check

Analyze the results.

Identify barriers obstructing the plan’s success.

Act

Based on the results, accept or revise the plan.

Deming compiled fourteen points that he believed were the basis of

industry transformation. The points stressed constant innovation and

training in quality assurance. The fourteen points are as follows:

1. Constancy of purpose.

There must be clarity among those in an organization of “what

we are doing and why we are doing it.”

2. Adopt the new philosophy.

Improvement is an ongoing process. Organizations can no longer

tolerate acceptable levels of defective materials and

workmanship.

3. Cease dependence on mass inspection.

Quality does not come from inspection; it comes from

improvement of the process.

4. End the process of awarding contracts on price alone.

Meaningful measures of quality should be required in addition to

price.

5. Improve every process.

Continuous improvement is a process that never ends.

6. Institute training on the job.

A trained worker is more productive and produces more quality

products, so, organizations should provide training and

development to its workers.

7. Institute leadership. Leadership is not the same as supervision.

Leadership should be focused on helping employees do a better

job.

8. Drive out fear. Build trust, collaboration and cooperation and

stop using management principles of command and control.

9. Break down barriers. Employees across all departments should

work as a team and focus on what is good for the organization.

10. Eliminate exhortations. Organizations should abolish slogans

and posters which ask for compliance with quality improvement

goals.

11. Eliminate arbitrary numeric targets. The focus should be on the

quality of the products, not the quantity. The focus should not be

on how many are made, but on how well a product is made.

12. Permit pride in workmanship. Involve people at all levels of

the organization to take part of the improvement process. Stop

annual merit rankings, as employees must have pride in their

work, not pride in their merit ranking.

13. Encourage education. Continued improvement extends to

employees, thus self-improvement should be encouraged.Page 48

14. Top management commitment and action. Management

should actively reinforce the fourteen points and the

organization’s commitment to quality.

Deming is also known for the “85-15 rule.” He believed that when problems

occur, an individual worker was at fault only 15 percent of the time. He felt

that a majority of the time (85 percent) the problem was with the system,

which could include not only machinery but management rules and

systems. Deming believed managers often blamed employees when things

went wrong, when it was actually the system that was causing the problem.

Joseph M. Juran

Joseph M. Juran (1904-2008), known as the “father of quality,” was born in

Romania and came to the United States as a young child. Poor but hard

working and extremely bright, he earned his engineering degree in 1924

from the University of Minnesota. After college, he worked at the Hawthorn

Works in Chicago, where he participated in a training program and became

one of two engineers chosen to work for the Inspection Statistical

department. In 1937, Juran “conceptualized the Pareto principle, which

millions of managers rely on to help separate the ‘vital few’ from the ‘useful

many’ in their activities. [Many] commonly referred to [this concept] as the

80-20 principle.”44 The Pareto principle is commonly considered a “rule of

thumb” in business—80 percent of an organization’s sales come from 20

percent of its customers, or 20 percent of its customers submit 80 percent

of complaints.

In 1951 Juran published his book, Quality Control Handbook, in which he

summarized a quality trilogy that incorporated the concepts of quality

planning, quality improvement, and quality control.45 In quality planning

the organization has to identify its customers, determine the needs of those

customers, and develop a product that could meet those needs. Quality

improvement included development of a process to produce the product.

Quality control attempted to prove that the process developed during the

quality improvement stage could actually produce the product with only

minimal inspection.

The Quality Trilogy

Quality Planning

Identify Customers

Identify Internal and External Needs

Create Quality Measures

Quality Improvement

Establish Quality Goals

Quality Control

Create Processes to Meet Goals

The focus of Juran’s theory was on training management to control quality.

In quality management, the expectation is for upper management to control

the strategic positioning of the organization, while middle management is

expected to handle the operational tasks and oversee the workforce. The

workforce is then responsible for the actual labor and getting the job

done.Page 49

Peter Senge

Peter Senge (1947- ) is a graduate of Stanford and Massachusetts Institute

of Technology and has had a major influence on modern business

management, especially through his idealistic theories and promotion of

flexibility in adapting to change. His book, The Fifth

Discipline (1990), introduced the theory of learning organizations. The five

disciplines of the learning organization are:

1. Personal mastery requires probing within one’s inner beliefs to be

objective in accepting the reality of the environment and

promote self-awareness and mental preparation for change. It is

a state of continually learning.

2. Mental models are also internal reflections that determine

individual comprehension and reaction to external forces. This is

where the individual must avoid previous assumptions and start

with a clean slate.

3. Shared vision entails the ability to cast aside simple compliance

and redirect those energies to commitment. The individual has

the enthusiasm to achieve.

4. Team learning breaks down barriers to communication and

builds strength in group interaction and communal thinking. It

is the culmination of the shared vision.46

5. Systems thinking integrates the first four disciplines-shared

vision, personal mastery, mental models and team learning-to

create synergy. Systems thinking then is “a conceptual

framework for understanding patterns of events and behaviors to

help see how to change them.”47 Systems thinking can be briefly

defined as the study of patterns of behavior and events to

concentrate on developing processes necessary for

change.48 Systems-thinking is a concept that usually focuses on

long-term issues and emphasizes how all of the disciplines are

dependent upon the others and are needed to solve complex

issues. In systems-thinking large patterns are dissected into

small parts, which are analyzed to define their interdependence.

Change occurs when the process’ norms and assumptions are

challenged. “The basic contribution of the fifth discipline of

systems thinking is the art of seeing the forest and the trees.”49

Senge proposes that the success of an organization depends on its ability to

adapt to change; it must become a learning organization. In a 1991

interview, Senge described the innovative process of learning:

In the innovation stage you are learning to do something that is reliable and

replicable. I think that is where we are now with learning organizations. We

are developing the key understandings, practices, and tools. There are four

levels of this process as it unfolds: The highest is the level of values and

vision. The second encompasses the skills and capabilities. Third are the

methods we use to develop those skills and capabilities. The fourth is the

infrastructure. By that I mean the design of an organization such that

continual practice of the methods continually develops the skills and

reinforces the values and vision.50

Senge admits that becoming a learning organization is not an easy process.

Like people, organizations have learning disabilities. Individuals tend to

focus on their own roles instead of the global results of their actions. The

external environment is often blamed for organizational shortcomings

because leadership neglects internal reflection. Instead of being proactive,

the organization’s leaders become engulfed in short term issues and often

rely on past experiences, rather than engaging in strategic forecasting. To

these organizations, challenge is viewed as a negative force instead of an

opportunity for improvement.51 Page 50

Senge emphasize the need for individual reflection and action to promote

human values and learning for all managers and employees within an

organization. Internal reflection, growth, and collaboration foster the agility

of an organization. The ability for organizations to thrive instead of survive

is based on the forward thinking and ability to change direction quickly.

The agile organization is one that will thrive.

CONCLUSION

This chapter presented the accomplishments of engineers, economists,

social psychologists, professors, sociologists, and entrepreneurs. All were

visionaries whose work became the foundation for the management

practices of today. Many did not achieve recognition until after their

death, and others were recognized during their lives and then nearly

forgotten, but all contributed ideas to improve functionality in the

workplace. Management theories and practices were created through

personal experiences, careful observation, intuitive thought processes,

and determination. It was not enough to merely accomplish their goals,

but these theorists felt compelled to share the knowledge they acquired,

which allowed others to reap the benefits of their labors.

Management theory impacts organizations because how it is

implemented impacts people. Through the years, paradigms have shifted

and the focus has changed from a hierarchal pyramid of management

structure to a flattened, inverse pyramid model.

In his book, The Essential Drucker, Peter Drucker wrote, “Management’s

concern and management’s responsibility are everything that affects the

performance of the institution and its results whether inside or outside,

whether under the institution’s control or totally beyond it.”52 He also

wrote that “in a traditional workforce the worker serves the system; in a

knowledge workforce the system must serve the worker.”53

Today’s corporate systems have evolved into thinking and learning

organizations to survive in an increasingly complex and competitive

market. Obstacles become challenges; challenges become opportunities.

The workforce is recognized as an integral key to company success from

the contributions of those who operate at the ground-level who

participate in performance improvement. The realization that processes

can be improved by consulting with those who perform the tasks has led

to the formation of diverse work groups that combine members with

different sets of talents, collaborating to achieve a shared mission. All of

this has occurred because individuals existed in history who challenged

the status quo. The individuals discussed in this chapter were

instrumental in the evolutionary process of management theory.