Management Thought

&

Organizational Behaviour
 The concept of Management

◦Management is the process of achieving organizational

objectives by engaging in the five major functions, as
mentioned below:
◦Planning: defining goals, developing strategies and plans

◦Organizing: identifying the tasks, allocating jobs

◦Staffing: identifying and placing people at right positions

◦Leading: motivating, directing, communicating employees

◦Controlling: monitoring and correcting the deviations

 Manager

◦Manager is an individual who achieves goals through people

and resources

◦The main objective of all managers is to improve

productivity , efficiency and effectiveness
◦Perform all functions of management

◦Manage all resources at all levels of hierarchy

Management Process
Levels of Management
 Top Level

◦The people at this level are responsible for taking major

decisions for the organization as a whole, overall activities of
the business and are accountable for its impact on the society.

◦Examples- Board of Directors, CEO, President, Senior Vice

Presidents, Vice Presidents, etc.
 Middle Level
◦The people at this level deal with the actual operation of
various departments in the organization and are directly
responsible for the performance of the first level managers.

◦Examples- Executive Directors, Chief Manager, Mangers,

Department heads, etc.
 First Level Managers

◦The people at this level are directly responsible for the

performance of employees in operations.

◦Examples- Team Leaders, Supervisors, Clerk, Shop floor

workers and technicians
 Managerial Roles by Mintzberg

◦Interpersonal Roles- (social in nature, relate to other people)

◦Figurehead (taking visitors to dinner),

◦Leader (hiring, training, motivating) and

◦Liaison (managing suppliers)

 Managerial Roles by Mintzberg

◦Informational Roles- (information processing)

◦Monitor (seeking value-added information),

◦Disseminator (transmitting information to others) and

◦Spokesperson (speaks for the organization to outsiders)

 Managerial Roles by Mintzberg

◦Decision-Making Roles:

◦Entrepreneur (innovator, initiator),

◦Disturbance handler (settles disputes),

◦Resource allocators (distributing resources among

individuals and groups) and
◦Negotiator
 Managerial Skills

◦Technical Skills- Applying specialized knowledge or

expertise
◦Interpersonal Skills- to communicate with, understand
and motivate people
◦Conceptual Skills- Analyze and think in complex business
situations
◦Diagnostic Skills- to understand cause and effect
relationships and find solutions
Managerial Skills
 Management Approaches

◦Classical Approaches- Taylor’s Scientific Management,

Fayol’s Administrative Theory and Weber’s Ideal
Bureaucracy

◦Behavioral Approaches- Hawthorne studies, Mc Gregor’s

Theory X and Theory Y and Ouchi’s Theory Z

◦Modern Approaches- Systems Theory and Contingency

Theory
Scientific Management Theory: Taylor (Father
of scientific management)
Focused only on efficiency and productivity:

◦Scientifically select employees and then train them to do the

job

◦Supervise employees to make sure that they follow the

prescribed methods for performing their jobs

◦Continue to plan the work but use workers to actually get the
work done

◦Explicit role was to get output from workers

 Administrative Theory Principles-Henri
Fayol
◦Division of work

◦Authority and responsibility

◦Discipline

◦Unity of command

◦Unity of direction

◦Subordination of individual interest to general interest

◦Remuneration
 Administrative Theory Principles-
Henri Fayol (Contd.)
◦Centralization
◦Scalar Chain
◦Order
◦Equity
◦Stability of tenure of personnel
◦Initiative
◦Sense of unity
 Elements of Max Weber’s Ideal Bureaucracy

◦Rules and Procedures: A consistent set of abstract rules and

procedures to ensure uniform performance.

◦Division of Labor: Each position should be filled by an expert.

◦Hierarchy of Authority: The chain of command should be clearly

established.
Elements of Max Weber’s Ideal Bureaucracy

◦Technical Competence: Employment and advancement

based on merit.

◦Segregation of Ownership: Professional managers, rather

than owners, should run the organization.

◦Documentation: A record of actions to be kept regarding

administrative decisions, rules and procedures.
 Hawthorne Studies
◦ The Hawthorne studies were conducted between 1927 and 1932 at Western Electric’s
Hawthorne plant near Chicago by Mayo (Father of HR).

◦ Illumination experiments- illumination intensity → productivity

◦ Illumination↑ for experimental group → productivity↑ for both experimental and control
group

◦ Illumination↓ experimental group → productivity↑ for both experimental and

control group

◦ Relay room experiments- changes in various job conditions on group

productivity (incentives↑ working hours↓ → productivity↑)

◦ Bank wiring room experiments- (impact of small groups on the individuals by

attaching wire with switches for certain equipment used in telephone exchanges;
◦ highly efficient workers did not bring pressure on less efficient workers to increase output
and take advantage of group incentive plan
 Hawthorne Studies
◦The reasons were:
◦Small group
◦Supervisor
◦Earnings
◦Novelty of situation
◦Interest in the experiment
◦Attention received

◦Hawthorne effect: Individuals modify or improve an aspect

of their behavior in response to their awareness of being
observed.
 Theory X and Theory Y: McGregor -
Managerial views of employees

◦Theory X assumes that-

◦People do not like work and try to avoid it.

◦Employees have to be either coerced by punishment or guided

by means of financial rewards to make them work effectively

◦People prefer to be directed, to avoid responsibility, to want

security

◦Employees are not too ambitious, seldom take risks and give
high importance to their security needs
◦Theory Y assumes that-
◦People do not naturally dislike work

◦People are internally motivated to reach objectives to which they are

committed.

◦People are committed to goals to the degree that they receive personal
rewards when they reach their objectives.

◦Tight controls and punishments cannot make people deliver the goods

◦People take responsibility, can solve their work related problems by

using creativity and imagination

◦People are bright, but under most organizational conditions their

potentials are underutilized.
 Theory Z by William Ouchi
◦Emphasizes on building close and trusting relationships among workers,
managers and others

◦Creating an environment for fulfillment of individual as well as

organizational needs.

◦Theory Z principles are:

◦ Mutual Trust: conflict is reduced to the minimum and employees
cooperate
◦ Increasing employee loyalty to the company: methods to strengthen the
bond between employees and organization
◦ Employee Involvement: participation in decision making
◦ Human Resource Development
◦ Strong focus on well-being of the employee
 Systems Theory & Components
◦The world must be understood in terms of mutually dependent “components”,
as a system with parts, links, goals and feedback mechanisms

An organizational system has four major components namely:

◦Input: Money, Materials, Men, Machines and informational sources are
required to produce goods and services

◦Transformation processes: Managerial and technical abilities are used to

convert inputs into outputs

◦Output: Products, services, profits and other results produced by the

organization

◦Feedback: Information about the outcomes and the position of the

organization relative to the environment it operates in
 Contingency Theory
◦There is no one best way to manage all situations

◦The response “ It depends” holds good for several management

situations

◦The task of managers is to identify which technique will, in

particular situation, under particular circumstances and at a
particular time, best contribute to the attainment of management
goals
 Definition of Organizational Behavior
◦Organization- It is a consciously coordinated social unit,
composed of two or more people, that functions on a relatively
continuous basis to achieve a common goal or a set of goals.

◦Behavior- It is the way in which one acts or conducts oneself,

especially towards others

◦OB is defined as “the study and application of knowledge about

how people as individuals and as groups act within
organizations”

◦OB includes understanding, predicting and managing human

behavior in organizations
 Significance of OB
◦Effective Management-
◦Helps managers better understand why others in the organization
behave as they do.

◦Helps mangers to better understand their own as well as others’

needs, motives, behaviors, and feelings, which will help them
improve decision making capabilities and work efficiently.

◦Organizational Performance-
◦Provides a set of insights and tools that all managers can use to
carry out their jobs more effectively.

◦Development of Skills
 Assumptions of OB

◦Organizations are social systems

◦People are motivated by many needs

◦People depend on each other for work

◦Attitudes and performance of workers are determined by

informal work group

◦Job roles are more complex than job descriptions

 Assumptions of OB

◦Communication channels should consider both organization

and people’s interests

◦Teamwork is essential for employees

◦Job satisfaction gives rise to higher productivity

◦For managing people effectively, managers also need good

social skills
 Interdisciplinary Approach
◦Psychology- Individual behavior, motivation, personality and
perception

◦Social Psychology- Change implementation

◦Industrial Psychology- Individual differences and physical

environment influence

◦Sociology- Group dynamics, culture and socialization

◦Anthropology- Cultural factors’ impact, value systems,

interactions and cross cultural analysis
Towards OB Discipline
Basic OB Model- Inputs, Processes, Outcomes
 Situation-Individual/Organism-Behavior
Model
◦Interactionalism suggests that individuals and situations
interact continuously to determine individuals’ behavior.

◦Organizational problems/situations lead to behavior

◦When people enter an organization, their own behaviors and

actions shape that organization in various ways

◦Organization itself shapes the behaviors and actions of each

individual who becomes a part of it
 Biographical characteristics
Refer to the personal characteristics-
◦Age
◦Gender
◦Disability
◦Marital status
◦Nationality
◦Tenure of employment

Impact-
◦Performance of employees at work
◦Productivity, satisfaction, absenteeism and turnover rates etc.
 Biographical Foundations

◦Heredity- It is the process by which characteristics are

given from a parent to the child through the genes

◦Biological development of the individual- Physiological

aspects and level of maturity

◦Cognitive processes- Thinking and Problem solving

 Diversity at Work

◦Diversity is the presence of members of different ages, genders,

ethnic groups and/or educational backgrounds in an
organization

◦Composition of the workforce has been changing over the past

few years
 Reasons for Diversity at Work
◦Recognition & desire for diverse viewpoints

◦Changing workforce

◦Legislation

◦Increase in international business

◦Competitive pressures
 Diversity Management

◦Creation of employee-friendly workplaces

◦Providing Diversity training to employees

◦Developing Mentoring programs for employees

◦Learning

◦Empathy

◦Mentoring

◦Alternative work schedules

 Challenges in OB

Changing environment
◦Diversity
◦Globalization
◦Technology
◦Employment Relationships
◦Changes in organizational structures
◦Innovative work approaches for special needs of employees
◦Working with people with different cultures