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Administrative management theory means an attempt to find a rational way to design

an organization as a whole. The theory generally calls for a formalized administrative


structure, a clear division of labor, and delegation of power and authority to
administrators relevant to their areas of responsibilities.
Administrative Management Theorists

Henri Fayol (1841-1925): was considered to be among the most influential


contributors to the concept of this management. He contributed one of the
earliest theories of management, which remains one of the most comprehensive

Some principles: (4)

Scalar chain- According to this theory, you should design an organization with
clear lines of authority from the top down. This is a hierarchical structure.

For example, consider a large corporation. At the top is the board of directors who give
directions to the CEO, who in turn gives directions the vice presidents of each corporate
division. The vice presidents will then give directions to their middle managers, who in
turn give directions to supervisors down to individual employees.

Unity of command provides that there should be only one manager at a time to
give orders to an employee.

For example, imagine you are the CEO of a technology firm in Silicon Valley. While the
board of directors of your company governs the policy making and strategic planning,
under the concept of unity of command, you do not answer to all members of the board,
but only the chairman of the board.

The division of work: managerial work and technical work are responsible to
specialization to produce more and better work with the same amount of effort.

Example: If we consider the work of building a bridge, we can divide the work into
different tasks (such as designing the bridge, arranging money for building it, procuring
raw materials etc.) with deadlines to finish each task so that tasks can proceed to meet
the overall deadline for the project.

The principle of unity of direction means that there should be one plan of
action for a group of activities having the same objectives and there should be
one manager to control them.

For example, suppose an automobile company is manufacturing two products, namely,


scooters and cars, hence having two divisions. As each product has its own markets
and problems therefore each division must have its own targets. They must plan their
target relied on environmental condition to get better results
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Five Elements of Management:


Planning: Managers should draft strategies and objectives to determine the
stages of the plan and the technology necessary to implement it.
Organizing: Managers must organize and provide the resources necessary to
execute said plan, including raw materials, tools, capital, and human resources.
Command (delegation): Managers must utilize authority and a thorough
understanding of long-term goals to delegate tasks and make decisions for the
betterment of the organization.
Coordination: High-level managers must work to integrate all activities to facilitate
organizational success. Communication is key to success in this component.
Monitoring: Managers must compare the activities of the personnel to the plan of
action; this is the evaluation component of management.
Contribution and limitation
Contribution:
+ manage the information needs of the organization so that timely, relevant and
accurate information can be given to managers at all the different levels.
+ enhance managements ability to predict and control the behavior of their workers.
+ make certain that information flows and resources run smoothly and in the most
effective manner.
+ provide a clear and appropriate set of guidelines that managers can use to create
a work setting that makes efcient and effective use of organizational resources.
Limitation:
+ The management oriented theory does not give many attentions to the problems of
the workers. This is due to its concentration on organizations as a whole rather than
individuals and particular areas.
+ Lack of Important to Informal Organization: The administrative management theory
gives importance only to the formal organization structure. It does not give any
importance to informal organization or groups.

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