I. Management - Introduction And Historical Perspectives

Overview- This topic will discuss the job of a manager, the four primary functions a manager performs and the importance of understanding and using proper terminology.

What is Management?

Peter Drucker, in his magnum opus, Management: Tasks, Responsibilities, Practices described management as the alternative to tyranny. He believes that management is vital to a vigorous society.

"For management is the organ, the life-giving, acting, dynamic organ of the institution it manages. Without the institution, e.g., the business enterprise, there would be no management. But without management there would also be only a mob rather than an institution. The institution, in turn, is itself an organ of society and exists only to contribute a needed result to society, the economy, and the individual. Organs, however, are never defined by what they do, let alone by how they do it. They are defined by their contribution." (Drucker, 1974)

So what then is the contribution of management to our society? What is it that we as managers do that provides a social good? We take an assembly of people, materials and conditions and create a synergy which provides society with the goods, services and ideas it needs to survive.

Managers do this by performing four basic functions: planning, organizing, leading and controlling. Modern popular business literature seems to scoff at management and point to leadership as the only skill necessary to modern organizations . This perspective overlooks the critical underpinning that management skills provide to a leader.

A leader may move people, a leader may inspire action, a leader may provide a stunning vision of the future, but nothing of consequence will occur without the nuts-and-bolts knowledge of how to implement these energies. Management is the practical ability to take a concept and make it a reality.

A. The Four Functions of Management

    1. Planning The first function is planning, the ability to scan an environment to determine the resources at hand, those which are still needed, and to logically sequence action steps to achieve a goal. Most organizations fail, or at least, function at less than peak performance, through lack of proper planning. This critical aspect of management is often overlooked or given the short shrift by leaders who wish to rush to completion.

Good managers are those who can plan activities realistically. They understand that unforeseen events may change the conditions of the original plan, and they build in contingencies that allow them to shift quickly from one course to another. Managers live by the "Six P" credo: Proper

Prior Planning Prevents Poor Performance. Section Three of this lecture series will discuss the planning function at length.

    2. Organizing

The second function, organizing, builds from the planning function. When a manager organizes, the raw skeleton of the plan is fleshed out with people, resources, and activity locations. A plan without organization is simply a paper chase. A plan organized by a strong manager is a tiger preparing to leap.

Where the planning process had managers making assumptions as to what resources would be needed and available, organizing has managers assigning tasks and resources to specific people at specific locations. They are moving from concept to reality.

    3. Leading

The third function, leading, is often mistakenly believed to be independent from management. In reality, however, good leadership requires good management and successful management cannot occur without strong leadership. Management and leadership are in a symbiotic relationship: neither can survive long without the other.

Leaders (that is, managers who are leading) take the organized plan and bring it to fruition. They inspire and motivate people to accomplish tasks according to the plan to reach organizational goals. Leaders ensure the resources are available, that the organizational structure is functional, and that every person understands their place in the organization and the importance of their own work in accomplishing the organization's goals.

Planning may design the car, organizing layout the factory, identify the raw materials and the proper workers to assemble it, but leadership converts steel and muscle to automobiles. Lecture Section Five describes the leadership function.

    4. Controlling

The final function, controlling, provides reality-checks to the leader. Through the use of statistics, budgets and common sense, managers who control ensure that the organization is actually achieving the plan. As with all human endeavors, variance will occur. Organizations will lose sight of the original purposes and goals of an activity. Controlling brings the organization back to the plan.

Controlling is very similar to the skill of driving a car. When a driver exhibits proper lane control, he or she stays between the lines at speed. A driver's subconscious is acting in the controlling function: as the car drifts to one side or the other, the brain will send a signal to the arm to twist the wheel slightly in the opposite direction to get the car back on track. Just as unimpaired control keeps a driver safe, the control function keeps an organization secure in the knowledge that they are still on course and following their plan.

B. Historic Theories and Techniques of Management

American management practices grew out of a richly diverse background. This topic explores some of the most relevant theories of how to manage people and material. Although some of the theories may seem dated, the student should realize that many managers today are still practicing some form of these historic concepts.

    1. Scientific Management

In America at the turn of the twentieth century, most work was still accomplished in the way it had been for hundreds of years. Knowledge and techniques of work were either passed down in guilds or learned through trial-and-error by the worker as he tried to do the work required of him. This was not only a slow and dangerous method of learning a skill, but it created vast organizational inefficiencies as each worker created their own work methods. This manner of work could not survive in the new industrial climate where mass production was becoming the order of the day. For mass production to accomplish its goals of lower prices and greater numbers of consumer goods, workers must become more efficient and more orderly.

Scientific Management stepped in to study work using the latest scientific methods to determine the "one best way" to perform a task. By clearly organizing each workers task and the relationships between workers and workflow, these theorists hoped to increase efficiency throughout the organization.

The father of Scientific Management was Frederick W. Taylor, a Puritan mechanical engineer who worked at Bethlehem Steel. His study of steelworkers dramatically increased the output of the workers. He created four principles of management, most of which are still applicable today! Taylor's principles were:

Develop a science for each element of an individual's work, which will replace the old rule-of- thumb method. This can still be seen today at organizations whose workers follow a set method of accomplishing a task. It is even true when observing a governmental/service organization's approach to paperwork!

Scientifically select and then train, teach and develop the worker. This approach is followed by a majority of firms. Organizations that require an entrance examination or an "interest survey" as a prerequisite of employment are using scientific selection. Training of employees is now a multi- billion dollar industry in itself and forms the basis for the latest management concepts such as the "learning organization."

Heartily cooperate with the workers so as to ensure that all work is done in accordance with the principles of the science that has been developed. It was by forgetting this principle that American automotive industries suffered severely through repeated labor strikes and poor product quality in the 1970's. It could be argued that the recent interest in Total Quality Management (TQM) team-based work is a branch from this historic tree.

Divide work and responsibility almost equally between management and workers. Management takes over all work for which it is better fitted than the workers. This principle has survived repeated historic swings of workload from worker to manager. In Taylor's day, the worker had most of the work and responsibility. Then professional managers took over more and more of the responsibility until the worker felt unimportant and out-of-contact with his or her work. Now, through downsizing, TQM, job reengineering and new motivational concepts, we are back at pushing much of the responsibility back onto the worker. Another important voice in Scientific Management was the husband and wife team of Frank and Lillian Gilbreth. The Gilbreths perfected time and motion studies, with a goal of eliminating all wasted movements from human work. They developed an elaborate system of movement description and classification. The end result of their work with bricklayers was a more productive worker who was less fatigued at the end of the workday.

While Scientific Management focused primarily on the nature of work in an organization, another group of theorists was looking at the organization as a whole to try to improve organizational efficiency.

    2. General Administrative Theorists

The General Administrative Theorists were people who were just as upset with the condition of organizations as the Scientific Managers were with the condition of the work process. Just as workers had to learn their work on their own, so did administrators. This was very inefficient and often resulted in unfair practices.

The product of the General Administrative Theorists was the bureaucracy. Although in modern society a bureaucracy is looked down upon as being slow, clumsy, and unresponsive, it was created to prevent the excesses of its day. At the turn of the century there was no such thing as a personnel manual or staffing standards. People were treated unfairly by organizations because no rules prevented it. Work was duplicated and management by fiat was common.

One of these theorists was Henri Fayol, a French manager who created fourteen principles of management. Students reading Fayol's work often comment that it is only common sense. But it must be realized that when Fayol first created his principles, they were revolutionary. It is a testament to his vision that now these groundbreaking ideas are considered commonplace.

Fayol, as a practical manager stressed what must be in place to manage an organization effectively. His principles included: division of work, matching authority and responsibility, unity of command, subordination of the self for the organizational goals, centralized decision making (where appropriate), scalar authority chain from top of the organization to bottom. He even went so far as to lay out the groundwork for modern corporate motivational theory: fair wages, equity, stability of personnel, a desire for employee initiative and achieving esprit de corps.

Max Weber, a German sociologist, developed the concept of an ideal bureaucracy. In Weber's bureaucracy, labor was divided into simple, well-defined tasks, the firm was organized as a hierarchy with formal selection of office holders based on skills and training. The organization was run using formal rules and regulations impersonally: no favoritism was allowed. Finally, the bureaucracy was a professional organization. Managers were not owners of the process; they were professional officials of the organization.

Weber's bureaucracy still exists today, and while perhaps not the most efficient form of organization in all cases, it does do what it was designed to do. It fairly and effectively accomplishes organizational goals without favoritism.

The last General Administrative Theorist we will discuss is Ralph C. Davis, another practicing manager, whose gift to the future was describing the "organic" functions of management: planning, organizing and controlling. The modern study of management is founded on Davis' pioneering work.

    3. The Quantitative Approach to Management

One unique approach that built upon the work of both Scientific Management and the General Administrative Theorists developed in the Ford Motor Company after World War II. Here managers used statistical methods and modeling on real life production problems to determine optimum solutions. One current outgrowth of this approach to management is TQM, a management philosophy based on statistics that attempts to control variance within a production system using statistical methods.

C. Introduction to Organizational Behavior

In the last topic we discussed the management theories which either recreated the way work was done or the organizations within which the work was being done. Now we are going to focus on the people who actually get the work done. The study of people working together is called Organizational Behavior.

There were many early theorists who described people at work, but the real watershed in the field was a series of scientific studies conducted at the Hawthorne plant of the Western Electric Company Works in Cicero, Illinois in the 1930's.

    1. The Hawthorne Studies As we discussed earlier, the Scientific Management theorists were attempting to find the "one best way" to accomplish work. The engineers at the Hawthorne plant were attempting to determine the best level of illumination in the production area to get maximum production at the lowest cost for illumination. They used the best scientific method to determine this level, an experimental and a control group. What they found however was the production was not directly related to illumination. They were unable to determine the cause of the increase in production.

Elton Mayo, a Harvard professor, was brought in on the project and an entire series of experiments were conducted over five years. The crux of the project was that there was a force at work in the experiment beyond those considered by the original researchers: human nature. The

Hawthorne Studies may have had some faults from a scientific basis, but the results clearly indicated to managers that individual workers and work groups were more than just mechanistic pieces in the production machine. The Studies determined that one of the most powerful influences on production level was the dynamics of the workgroup. Managers now had to look beyond the work procedure to the worker as an active participant in the production process.

This new emphasis on the worker as a major determinant of efficiency led to more studies of human motivation in the workplace.

    2. Early Motivation Theories

There are three theories of human motivation which are applicable to the manager. While all these theories have validation problems, as concepts, they are still worth study.

One of the earliest popular humanistic theories on motivation was Abraham Maslow's Hierarchy of Needs Theory. Maslow believed that there were five levels of human need listed in order from most critical to survival to the most esoteric. In the original theory, people advanced from the lowest level to the highest only when they had completely satisfied the sequentially lower order needs. Even if a person advanced to the upper levels of need satisfaction, the loss of any of the lower order needs would cause the person to drop to that lowest level.

Maslow's hierarchy of needs started at the "Physiological" needs: those involved in getting sufficient food and drink, shelter, sex and other physical requirements for survival. Once a person was satisfied at that level, it no longer motivated the person. Someone who just finished a seven-course meal is unlikely to pay for more food. The desire is now gone: the need is satisfied. But he might be motivated by looking at the next order needs, those of "Safety."

The fully fed person may not want any more food, but if upon walking out of the restaurant, he is held up by a gunman, his need for security is not being met. The gourmand would be very willing to pay for increased police protection at this point. However, once the threat of the gunman is removed and no other threat is perceived the desire for safety would cease to be a motivator.

Once the person is fed and safe however, he may want companionship. This would be the "Social" needs level of the hierarchy. This could be used to convince the man of his need to purchase a membership in a local gym where he could meet new, interesting (and probably thinner) people. Having made friends at the gym, the man is unlikely to wish to join other organizations simply to meet people. This order of need is met.

Now he must be motivated toward the "Esteem" need level. This level includes both internal (self-respect) and external (recognition and attention) needs. He might be persuaded to purchase a weight reduction program so that he looks like all his friends at the gym. But, once he loses the extra 100 pounds and becomes a well-respected trainer of overweight people, this level no longer motivates.

Finally he approaches the pinnacle of the hierarchy: "Self-actualization" where the man can be all he can be. These needs revolve around self-fulfillment. He could be sold a distributorship for the weight loss product he consumed. He is now be the master of his own destiny -- an entrepreneur! As a successful businessperson, he now is at the top of his hierarchy.

Should he falter at the top however, lose his business, become penniless, have his new-found friends ignore him and become socially snubbed, he would end up back at the bottom of the hierarchy in search of a cheap meal!

While Maslow's theory hasn't been validated by research, its simplicity and inherent logic make it still a very popular means of explaining human behavior.

    3. McGregor's Theory X and Theory Y

McGregor's belief is essentially that there are two different perspectives of human behavior. People who subscribe to Theory X think that workers are inherently lazy and will avoid work. Theory X managers will be very coercive and tend to use strong control over these unwilling workers. Workers are motivated primarily by security needs (the lowest two levels of Maslow's hierarchy). The Theory Y manager believes people are natural workers. They enjoy producing and desire increased responsibility. These managers desire to develop their subordinates for positions of greater authority. Theory Y leaders motivate by helping workers gain commitment to organizational goals. In Maslow's hierarchy, the Theory Y manager is motivating toward the top three levels. Research has not validated the assumption that Theory Y concepts produce better managers or higher production levels. Many Theory X managers are highly successful without resorting to the Theory Y beliefs.

    4. Herzberg's Motivation-Hygiene

Theory Frederick Herzberg developed his theory of motivation based on his research on what people wanted from their jobs. The answers to this simple question revealed an interesting split in motivation. Herzberg tied motivation into job satisfaction. He discovered that in addition to the identified motivational factors, there were some factors that acted as de-motivators. In other words, the motivational factors provided job satisfaction, while the de-motivators were related to job dissatisfaction.

The motivators were relatively simple and related well to Maslow's work. Motivators include achievement, recognition, the work itself, responsibility, advancement and growth. Herzberg's unique contribution was the recognition that none of these factors would actually provide job satisfaction unless a second set of factors was achieved first.

This second set Herzberg called "Hygiene Factors." Hygiene factors were those factors that removed satisfaction from the job when not present, but did NOT add motivation/satisfaction when in place. The factors are supervision; policies; relationships with supervisors, peers and subordinates; working conditions; salary; the worker's personal life; status and security.

If the hygiene factors were not satisfactory, no amount of motivators would increase job satisfaction. In a sense, hygiene factors remove dissatisfaction with a job while motivators increased the job's satisfaction.

Herzberg's theory might be considered by some to be simplistic, it still is the basis of modern job design.

    5. Early Leadership Theories

While motivation may be the key to higher levels of employee productivity, much research has been done to identify the broader characteristics of successful leaders. The hope is to identify either the behaviors or traits that are used most often by good leaders so that they can be emulated.

    6. Trait-Based Research

The initial approach to studying leadership was to examine the traits exhibited by leaders. This method did not prove very helpful. Research could not determine those traits always associated with strong leaders, but there was some success at finding simple associations between traits and leaders. Six were identified: drive, desire, honesty/integrity, self-confidence, intelligence, and job-relevant knowledge.

    7. Behaviorally-Based Studies

A more successful approach was to observe the actions (that is, behaviors) of leaders. The most important aspect of this research is that it strongly indicated that leaders could be created through training!

There are four major relevant studies: University of Iowa, Ohio State, University of Michigan and the Managerial Grid.

        a. University of Iowa Study In this study three types of leadership styles were identified: democratic, autocratic and laissez- faire. Democratic leaders actively involved subordinates in decision making and delegated authority. Autocratic leaders maintained most of the power, dictating work methods and limiting participation. Laissez-faire leaders gave the power to the work group who then made the decisions and completed the work.

The democratic leadership style was shown to be the most effective. This result has not been completely validated by later studies.

        b. Ohio State Study

At Ohio State, leadership behaviors described on a 2-by-2 matrix. On one axis was "consideration" the concern show by a leader toward a follower's feelings and ideas. The other was "initiating structure," behaviors which helped the employee understand their place in the organization and work structuring.

The best position to operate from was to be both high in consideration and initiating structure. However, upper level management judged as effective leaders those who were high in structure no matter what the level of consideration. On the other side of the coin, subordinates thought managers with high consideration were always more effective. The best style in this study was really determined by the situation faced by the leader.

        c. University of Michigan

This study examined the amount of employee or production orientation. Leaders with high employee orientation were found to be associated with high group productivity and higher job satisfaction. This study was a distant echo of the findings of the Hawthorne Studies.

        d. Managerial Grid®

In this commercialized study, a 9-by-9 grid marked the results of a leader's self-examination. The axes are concern for people and concern for production. Five primary leadership styles were identified. The emphasis was on identifying the individual's "comfort position" so that personal growth could occur as the leader tried new behaviors to shift leadership style position.


The optimal leadership style was seen to be at 9,9 on the chart with a high concern for both people and production.


Copyright Information
Title: Management- Introduction and Historical Perspectives (Lecture Notes)
Author: John Anderson  (Instructor)
University: National University
Course: MGT 409C- Principles of Management and Organization
Date: June 1, 2002 (Received)

Certain materials herein are included under the fair use exemption of the U.S. Copyright law and have been prepared according to the educational multimedia fair use guidelines and are restricted from further use. This work may be protected by further copyright, reproduction and distribution (in violation of United States Copyright Law).