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PART ONE
FOUNDATIONS
Part One introduces key foundations and concepts in the study and analysis of management. Part One also analyses the concept of trust in organizations. Part One contains the following chapters:
Chapter 1 ā Foundations of Management Thinking
Chapter 2 ā National Culture and Management
Chapter 3 ā Trust
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Chapter 1
Foundations of Management Thinking
The first chapter of this book summarizes the contribution of a variety of individuals and schools of thought to the development of the base of knowledge and competence associated with the principles, process, and practice of management. A variety of definitions and viewpoints are described. While some of the ideas stated here are explored in greater detail in later chapters, the main purpose of introducing them in this way is to give the reader a broad overview of some of the ideas and concepts that have influenced thinking about management.
The Practice of Management
The practice of management, and the principles that can be drawn from that practice, largely developed during the nineteenth and twentieth centuries. This practice of management resulted from the experience of running the state, industrial, administrative, and commercial organizations that now shape our society.
In particular, that management experience is derived from the medium and large-scale organizations that have become a dominant feature of all developed countries. In general, these medium and large-scale organizations have emerged since the middle of the nineteenth century. They developed in response to such demands as:
the entrepreneurship and economic growth that was associated with the development of Western capitalism.
the growth of mass national and international markets; and the supply, trading and distribution arrangements to which this growth gave rise.
the factory system of industrial manufacture, and the technological developments associated therewith.
the development of the division of labour and specialization of function.
the development of travel, shipping, and communication capabilities.
the growth of the state sector, for instance associated with the provision of defence and security, healthcare, and social welfare.
The growth of medium and large-scale organizations also gave rise to the development of the practice of management as a necessary consequence of the division between ownership and control. Organizations became too large for their owners to control alone. And their increasing specialization and complexity called for the services of specialist administrators and managers to formalize operations and to maintain effective functioning. The division between ownership and control, with all its implications for the development of the profession of management, had become clearly established by the 1930s.
Pioneers - The Classical and Scientific Schools of Management
The industrialists, consultants, and writers who can collectively be described as belonging to the Classical and Scientific Schools of Management were active during the period 1880 to 1950. Their pioneering views are still influential. Significant contributors to these early schools include Frederick Taylor and Henri Fayol. Their work is described in more detail in the following sections of this chapter. Other contributors include Max Weber (a sociologist and administrative scientist), Henry Gantt, Frank and Lilian Gilbreth, Lyndall Urwick, and E.F.L. Brech. The common characteristic of the work of these people is the emphasis upon a āformalā approach to organization and management. Some of their principles are described below.
Formal Organization
The Classical and Scientific schools lay down clear prescriptions by which formal organization is to be structured and established. Taylor, Fayol, and Weber all lay stress on the division of labour and specialization of function (as described by Adam Smith in his 1776 book The Wealth of Nations). Tasks and workflows are to be broken down into their discrete components, and assigned to individuals or role holders who can then build up specialist expertise and productivity in their accomplishment.
Work specializations are grouped into departments on a functional basis. This is the process of departmentation. Fayol delineated the main categories of functional specialization and departmentation that are widely used today. These are the:
accounting and financial.
administrative and managerial.
Weber suggested that technical expertize and competence in the performance of functional specialisms should be the major criteria for recruitment, appointment, staff appraisal, and promotion within the enterprise.
The various specialist and functional efforts of individuals, role holders, and departments are combined, communicated, co-ordinated, and controlled through an organizational pyramid or management hierarchy, as described by Fayol and Weber. This classic centralized management structure is analysed in detail in Chapter 4.
Operational Efficiency and Productivity
Frederick Taylor and others in the School of Scientific Management showed that substantial increases in operational efficiency and productivity could be obtained from the application to operational processes of systematic and scientific techniques based on:
the elimination of unsystematic,
ad hoc operational methods, which Taylor described as ārule of thumbā.
the use of the systematic motion study of work practices to determine the optimum way of completing tasks.
the use of the systematic time study of employees to establish activity standards for work performance.
the improvement of working conditions (such as lighting, tool design, posture, the person-machine interface, ergonomics, etc.) so as to eliminate unnecessary fatigue and to maintain a consistent quantity and quality of output.
the planning of work layouts and production arrangements, thereby minimizing the incidence of unnecessary movement and cost.
the control and costing of production activities - Henry Gantt, for instance, introduced diagrammatic charts to monitor actual output and compare this with the plan or budget for that production period.
Management and Motivation
Structures of organization and management should, it was suggested, be used to make sure that work activities were appropriately ordered, controlled, and disciplined. Effective communication, co-ordination, and control would result from the introduction of a properly centralized organizational hierarchy. It was seen as the task of management to plan and allocate tasks and workflows and to achieve them through the disciplined effort of subordinates.
The managerial role was seen as a supervisory one. The process of supervision needs to be clear and understandable, free from ambiguity, even-handed, and equitable. Fayol suggested that equity required kindness and the application of good sense, experience, and a good nature. Managers should ensure that workloads and responsibilities are equally and fairly divided. Delegation should not be used (abused) to make any one managerās life easier. Each must take a fair load.
Weber also noted that the exercise of managerial authority in respect of subordinates must be legitimate, not arbitrary. The legitimacy of this authority should be based upon office, position, or role (and not personality). It should be constrained by the formal policies, rules, and procedures of the organization. Subordinates must be free from the threat of arbitrary dismissal, and enjoy reasonable stability of tenure of their post. Otherwise, experience will not be built up, and staff will behave in a defensive manner in order better to protect themselves against any implicit threat from their employer.
At the same time, managers should motivate their subordinates by delegating sufficient authority to allow them to exercise initiative. Fayol noted that initiative is a powerful stimulant. He suggested that āthe manager must be able to sacrifice some personal vanity in order to grant this satisfaction to subordinatesā.
Remuneration
The remuneration of personnel should be fair and encourage effort, being related to output, capacity, and opportunity. Taylor was at pains to stress that one of the main concerns of managers should be that of generating increased wealth, so that the aspirations of employees, owner, managers, and shareholders could be met without ...
