Topic 1. Managers and Managing.

1. Management is a process of using organizational resources to achieve organizational goals effectively and efficiently through planning, organizing, leading, and controlling.

A manager is a person responsible for supervising the use of an organization’s resources to meet its goals.

Efficiency is a measure of how well or productively resources are used to achieve a goal.

Effectiveness is a measure of the appropriateness of the goals an organization is pursuing and of the degree to which the organization achieves those goals.

2. Planning is a process that managers use to identify and select appropriate goals and course of action.

Organizing is a process that managers use to establish a structure of working relationships that allow organizational members to interact and cooperate to achieve organizational goals.

Motivation is a psychological force that determines the direction of person’s behavior in an organization; a person’s level of effort, and a person’s level of persistence.

Controlling – an evaluation of how well an organization is achieving its goals and taking action to maintain or improve performance.

3. First-line manager is a manager who responsible for the daily supervision of nonmanagerial employees.

Middle manager is a manager who supervises first-line managers and responsible for finding the best way to use resources to achieve organizational goals.

Top manager is a manager who establishes organizational goals, decides how departments should interact, and monitors the performance of middle managers.

Technical skills are job-specific knowledge and techniques that are required to perform an organizational role.

Human skills are the ability to understand, alter, lead, and control the behavior of other individuals and groups.

Conceptual skills are the ability to analyze and diagnose a situation and to distinguish between cause and effect.

Topic 2. The Evolution of Management Theory

1. The evolution of modern management began in the closing decades of the 19 century, after the industrial revolution had swept through Europe and America.

Scientific management theory is the systematic study of relationships between people and tasks for the purpose of redesigning the work process to increase efficiency.

F.W. Taylor (1856-1915) is the “father” of the scientific management.

Taylor’s principles:

• Study the way workers perform their tasks, gather all the informal job knowledge that workers possess, and experiment with ways of improving how tasks are performed

• Codify the new methods of performing tasks into written rules and standard operating procedures

• Carefully select workers who possess skills and abilities that match the needs of the task, and train them to perform the task according to the established rules and procedures

• Establish a fair or acceptable level of performance for a task, and then develop a pay system that provides a reward for performance above the acceptable level

The Gilbreths.

Their aims were:

1. break up and analyze every individual action necessary to perform a particular task into each of its component actions

2. find better ways to perform each component action

3. reorganize each of the component actions so that the action as a whole could be performed more efficiently – at less cost of time and effort

2. Administrative management theory is the study of how to create an organizational structure that leads to high efficiency and effectiveness.

Henry Fayol (1841-1925)

Fayol’s 14 principles of management:

1. division of labor

2. authority and responsibility

3. unity of command

4. line of authority

5. centralization

6. unity of direction

7. equity

8. order

9. initiative

10. discipline

11. remuneration of personnel

12. stability of tenure of personnel

13. subordination of individual interests to the common interest

14. esprit de corps

Max Weber (1864-1920) – theory of bureaucracy (a formal system of organization and administration designed to ensure efficiency and effectiveness).

Weber’s principles:

• a manager’s formal authority derived from the position he holds in the organization

• people should occupy positions because of their performance, not because of their social standing or personal contacts

• the extent of each position’s formal authority and task responsibilities, and its relationship to other positions in an organization, should be clearly specified

• authority can be exercised effectively in an organization when positions are arranged hierarchically, so employees know whom to report to and who reports to them

• managers must create a well-defined system of rules, standard operating procedures, and norms so that they can effectively control behavior within an organization

3. Behavioral management theory is the study of how managers should behave to motivate employees and encourage them to perform at high levels and be committed to the achievement of organizational goals.

Mary Parker Follett (1868-1933)

Elton Mayo

4.

Management science theory is an approach to management that uses rigorous quantitative techniques to help managers make maximum use of organizational resources.

Systems theory

Open system is a system that takes in resources from its external environment and converts them into goods and services that are then sent back to that environment foe purchase by customers

Closed system is a system that is self-contained and thus not affected by changes occurred in its external environment.

Synergy is a performance gains that result when individuals and departments coordinate their actions.

Contingency theory is the idea that the organizational structures and control systems managers choose depend on – are contingent on – characteristics of the external environment in which the organization operates.