Organizational Theory and Behaviour

by Anita R. Grey

We did a research about motivation in our company and here is a small summary.

Organizational Theory and Behaviour: Four Theoretical Contributions

The historical context has forced the four theoretical contributions which are central to the understanding of today’s organizations to emerge during the times of Industrial Revolution when a great number of people had to work together under a certain set of rules to archive and a common objective.

I. Scientific Management, 1909. Frederick Winslow Taylor, an American mechanical engineer.

Main idea: simplification and optimization of work processes with scientifically calculated solutions  (the best way to do any type of workplace task (Baumgart & Neuhauser, 2009)) offered to a manager to reduce production time and increase productivity in workers (efficiency).

Principles: 1. determine the most efficient way to perform a task using scientific method ( Payne et al., 2006); 2. capability and motivation based job assigning; 3. performance monitoring & supervision; 4. manager-worker work time. 

Innovation: first time work processes were studied scientifically – “time and motion” studies (Krenn, 2011); workers and managers cooperation.

Motivation: Money.

Criticised for: common sense and judgement of workers/managers is disregarded (Lægaard & Bindslev,  2006) and reduces workers’ creativity.

II. Administrative Theory, 1916. Jules Henri Fayol, a French mining engineer.

Main idea: Administrative processes are set up for managers to get the best from people “on the ground” (Mind Tools, n.d.) and run a business efficiently.

Principles:14 Principles of Management to identify the skills needed to manage well: coordination (1. everyone is accountable to one superior; 2. limited ‘span of control’; 3. routine tasks for subordinates) and specialization (to form groups based on – purpose, process, customer, geography)(Lægaard & Bindslev, 2006).

Innovation: distinguish management as a profession; defined five functions of management: Planning, Organizing, Command, Coordination, and Control.

Motivation: inspiring initiative,  respect through values, and ensuring that people stay happy and productive at work provided with time and training they require.

Criticised for: oversimplification of administrative coordination by Simon (Lægaard & Bindslev, 2006), by Taylor for grounding a theory by one person’s observation.

III. Bureaucracy and Organizational Structure, 1922. Max Weber, a German sociologist.

Main idea: a neutral professional pubic employee should act as his/her superior’s interests were his/her own and can’t leave the bureaucratically assigned role for structure to function smoothly and effectively.

Principles: Emotions and values are not considered when making a decision (Lægaard & Bindslev, 2006), to achieve a goal means should be measured and side effects taken into account.

Innovation: the first person to attempt at the systematic understanding of the bureaucracy as “an administrative body of appointed officials” (Prasad et al., 2004), includes social and historical perspectives.

Motivation: Weber sees human nature is culturally pliable and thus motivations are culturally arbitrary (and thus problematic) (Lizardo, 2020).

Criticised for: hierarchy could lead to authoritarianism in the organisation; delay and inefficiency in the administration due to strict adherence to the rules; distance between employees (Mulder, 2017). 

IV. Administrative Behaviour, 1976. Herbert Alexander Simon, an American economist, political scientist and cognitive psychologist, he father of Decision-Making Theory.

Main idea: a decision making process is irrational as the reference frame and the knowledge about consequences are limited, struggle to set objectives right that tries satisfy value (Lægaard & Bindslev, 2006).

Principles:  “objective-mean chains” including value and factual premises within the objective hierarchy.

Innovation: The Administrative Man; challenged classical economic thinking on rational behaviour (Simon, 1945); applied psychological ideas to economical theories, including the theory of bounded rationality (Simon, 1957).

Motivation: Not available.

Criticised for: His decision making theory is also criticised on the ground that though decision making process is an important variable in the organisation, it is not the only factor; emotional factors are ignored.

Administrative Theory by Jules Henri Fayol

The most influential from historical and managerial perspectives, I would say, is the Fayol’s Administrative Theory. Fayol was the first one to view management as a profession that required knowledge acquisition. Deriving his 14 Management Principles from his personal experience when he saved a company from bankruptcy he noted, “I did not rely on my technical superiority… I relied on my ability as an organizer [and my] skill in handling men.” (Fayol, 2002). 

Crucial for the development of the modern day organizational theories was to allow people to become decision makers and proactive members of the organization. Workers from all levels were allowed to give feedback in order to improve practices in place and as a result to be a help at running an organization.

By focusing on administrative rather than technical skills of any given manager he set the basis of management as a profession. He saw a managers’ role was to help employees to develop productivity by reaching proficiency at one task at a time (1), expertise based respect (2) in the company that requires discipline (3) and a limited span of control (4). Employees in return should work in teams (5) on a collective interest (6). The organization should be fair and reward efforts (7), develop centralized decision making (8) and clear all structures (9) with the right people at the right places (10). With the stress put on the employees happiness, Fayol suggested to minimize staff turnover (12) and encourage within them plans for improvement (13). As it was said earlier that organization’s and group’s interest should be above personal with team work being united under one manager to boost up team spirit (14) and unity (Uzuegbu & Nnadozie, 2015).

Fayol recognized the importance of morale of each individual worker, therefore he an image of a professional manager to help each team member to support them along the way. As Daniel Wren (1995)concludes that if it is not for Fayol we “would still be teaching industrial engineering, sociology, economics, or perhaps ergonomics to those who aspire to manage. To be doing so would push us back to the 19th century, when technical know-how reigned supreme as a path to managerial responsibility.”

References:

Fayol., H. (2002). Critical Evaluations in Business and Management (Vol. 2). In J.C. Wood, M.C. Wood (Eds.). Routledge: Taylor and Francis Group. 

Foyal, H. (1949). General and Industrial Management. (C. Storrs, Trans.). Sir Isaac Pitman & Sons, ldt. (Original work published 1922). https://archive.org/details/in.ernet.dli.2015.13518/page/n7/mode/2up

Baumgart, A. & Neuhauser, D. (2009). Frank and Lillian Gilbreth: Scientific Management in the Operating Room. Quality Safety Health Care, 18.  413-415.

Krenn, M. (2011). From Scientific Management to Homemaking: Lillian M. Gilbreth’s Contributions to the Development of Management Thought. Management & Organisational History, 6 (2). 145-161.

Lægaard, J., Bindslev, M. (2006). Organizational Theory (3rd ed.). Mille Bindslev & Ventus Publishing ApS & bookboon.com.

 Lizardo O. (2020). Classical Theory Lecture Notes. From bookboon.com: http://olizardo.bol.ucla.edu/classes/soc-101/lecture-notes/
Mind Tools. (n.d.). Henri Fayol’s Principles of Management: Understanding Historical Administrative Theory. https://www.mindtools.com/pages/article/henri-fayol.htm

Mulder, P. (2017). Bureaucratic Theory by Max Weber. Retrieved [September 8, 2021] from Toolshero: https://www.toolshero.com/management/bureaucratic-theory-weber/

Prasad, D. R., Prasad, V.S. and Satyanarayan, P. (2004). Administrative Thinkers (eds.). Sterling Publishers.

Payne, S.C., Youngcourt, S.S. & Watrous, K.M. (2006). Portrayals of F.W. Taylor Across Textbooks. Journal of Management History, 12 (44). 385-407.

Simon, H. (1945). Administrative Behavior: A Study of Decision-Making Processes in Administrative Organizations (4th ed., pp. 1-28). The Free Press. 

Simon, H.  (1957).  Models of Man. John Wiley. p. 198.

Taylor, F.W. (2006). The Principles of Scientific Management. Cosimo, Inc.

Wren, D.A. (1995). Henri Foyal: learning from experience. Journal of Management History, 1 (3). https://ur.booksc.org/book/26311829/fc5ac5
 Uzuegbu, C.P.. & Nnadozie, C.O. (2015). Henry Fayol’s 14 Principles of Management: Implications for Libraries and Information Centres. Journal of Information Science Theory and Practice, 3 (2). 58-72.
Wren, D.A. (1995). Henri Foyal: learning from experience. Journal of Management History, 1(3). https://ur.booksc.org/book/26311829/fc5ac5
Uzuegbu, C.P.. & Nnadozie, C.O. (2015). Henry Fayol’s 14 Principles of Management: Implications for Libraries and Information Centres. Journal of Information Science Theory and Practice, 3 (2). 58-72.

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