2.2 Organizational Theory and Practice of Management
Organizational theory is critical since when applied to the management of an organization it may have a significant influence of the performance of the organization. Organizational theory refers to the study of the interrelationship between a formal organization and its operating environment. It incorporates the study of the organizational structure and culture, different approaches to management, leadership styles, and motivational theories applicable to various organizations. The above concepts have been developed over the past few centuries. However, they are still evolving. This enables managers to have a clear perception of their role within an organization. They enable managers to respond to various changes to ensure the effectiveness and success of the organization (Crowther & Green, 2004).
Management theory refers to a collection of theories that help managers perform their work effectively. It enables managers to understand the goals of the organization more effectively and their roles in the achievement of the goals. It enables them to know how they should plan their work to achieve the goals in an efficient and effective manner. It also enables managers to know how they should motivate employees, which would improve their productivity (Drucker, 2012).
There are different approaches to management. Classical theory is the oldest approach to management. Various scholars are renowned for their advocacy on the classical school of thought. They include M. Weber, H. Gantt, H. Fayol. Classical theories of management can be traced back to the Industrial Revolution. Classical theories of management focus on planning of work and the balance between authority and responsibility in an organization. They also focus on the unity of command in an organization to enable the organization attain its desired goals and objectives ((Drucker, 2012).
Frederick Taylor is the founder of the classical theory of management. He used the concept of classical management to develop the scientific theory of management. This helped in improving the productivity and efficient of an organization, which helped in maximizing benefits to both the employees and employers. Some of the basic principles of the scientific management include the development of a scientific knowledge on management, application of scientific knowledge in practical activities of an organization, physical division between employees and the management, scientific selection and training of employees, specialization of labor, and planning and scheduling of work. The principles of scientific management also include provision of proper incentives to improve the quality and speed of employees and extensive study on the elements of each performed by employees of an organization. Despite the fact that the classical theory is an old approach to management, it is still applicable in contemporary practice of management. Use of the classical theory enables an organization to understand the quality and quantity that would enable them to be financially viable (Crowther & Green, 2004).
Gantt’s approach to classical school of management focuses on the scheduling and organization of work. Gantt’s approach focuses on the use of resources and time when analyzing a project. Gantt developed the Gantt chart that is applicable in contemporary management. The Gantt chart is similar to the Program Evaluation and Review Technique (PERT), which used various visual tools to schedule resources and time required in the implementation of a project. Gantt charts provide a graphical depiction and schedule that helps in planning and controlling different activities required in the implementation of a project (Drucker, 2012).
2.3 Different Approaches to Management
There are various approaches to management. These include the pre-classical approach, classical approach, neoclassical approach, modern approach, and the emerging approach. The pre-classical approach strived to develop techniques that would help in the solving some of the problems facing an organization. It focused on improving the welfare of workers, significance of business skills, and improvement in management education (McAuley, Duberley & Johnson, 2007).
The classical approach comprises of the bureaucratic approach, administrative approach, and the scientific approach. The bureaucratic approach puts more emphasis on the authority structures of an organization. It also emphasizes on the need for formal education and training on management. The bureaucratic approach strives to improve the economic efficiency of an organization. On the other hand, the administrative approach focuses on the unity of direction, stability of tenure, and subordination of members of an organization to its interests. Scientific management strives to determine what employees do exactly and determining the cheapest possible to undertake the activities (McAuley, Duberley & Johnson, 2007).
The neo-classical approach comprises of the behavioral theory, human relation approach, and social systems approach. The behavioral theory emphases on the human element, which was ignored by the classical approach. It views an organization from the perception of an individual. It focused on individual attitudes and behaviors and group processes and their impact on an organization. The human relation approach enables managers to tackle the ‘human side’ of an organization more effectively. It acknowledges the fact that employees do not simply have economic needs; they also have psychological and social needs that have to be met. On the other hand, according to the social systems approach, the management of an organization comprises of social systems of people who cooperate in performing various tasks that are vital to an organization. Therefore, there should be harmony between the goals of an organization and the goals of groups within the organization. It also acknowledges that there is a relationship between the internal environment and external environment of an organization. Greg’s uses the neo-classical approach in the management of the organization (McAuley, Duberley & Johnson, 2007).
The modern approach comprises of the contingency approach, decision theory approach, and re-engineering approach. According the contingency approach, there is no ‘best way’ to manage an organization. The methods of management are dependent on the situation facing an organization. Therefore, the contingency approach puts more emphasis on the situational variables and external factors facing an organization. It requires managers to have analytical abilities that would help in solving the issues facing an organization. The decision theory approach requires managers to have clear objectives and criteria that guide them in making decisions. They should also develop alternatives and analyze the alternatives before choosing the best alternatives. It also requires them to ensure whether the implementation of the best alternative yielded the desired results. The re-engineering approach focuses on creating a ‘bog change’ in a fast manner to enable an organization cope with changes more effectively. It requires an organization to radical redesign of its business process to improve quality, efficiency, and service of an organization. It strives to improve efficiency by identifying redundancy and reducing wastes within the processes of an organization (McAuley, Duberley & Johnson, 2007).
Total quality management approach is one of the major components of the emerging approach. In total quality management approach, the management relies on the cooperation on all members of the organization. It focuses on quality and the long term success of the organization.