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Question 1 classical approach in management

Henri Fayol's management theory is a simple model of how management interacts with
personnel.

Henri Fayol's management theory is a simple model of how management interacts with
personnel. Fayol's management theory covers concepts in a broad way, so almost any
business can apply his theory of management. Today the business community considers
Fayol's classical management theory as a relevant guide to productively managing staff.

The management theory of Henri Fayol includes 14 principles of management. From these
principles, Fayol concluded that management should interact with personnel in five basic
ways in order to control and plan production.

1. Planning. According to Fayol's theory, management must plan and schedule every part of
industrial processes.

2. Organizing. Henri Fayol argued that in addition to planning a manufacturing process,


management must also make certain all of the necessary resources (raw materials, personnel,
etc.) came together at the appropriate time of production.

3. Commanding. Henri Fayol's management theory states that management must encourage
and direct personnel activity.

4. Coordinating. According to the management theory of Henri Fayol, management must


make certain that personnel works together in a cooperative fashion.

5. Controlling. The final management activity, according to Henri Fayol, is for the manager
to evaluate and ensure that personnel follow management's commands

However in modern organisations, various different types of hierarchy structures can be


implemented inorder to suit the business needs. For example Flat structure and Matrix
structure, the flat structure gives employee’s more decision making responsibility with fewer
layers of management from the director to the worker, on the other hand a matrix structure
has various management and supervisory layers from top to bottom. To an extent the classical
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approach for modern organisations has given a variety of choice of managing employee’s
within an organisation based on their environment and size. Larger modern organisations
may adopt a matrix structure inorder to allow them to monitor their employee’s effectively
whereas smaller organisations may adopt a flat structure which enables change to be
processed quicker.

This to an extent shows the validity of the statement whether a classical approach is no longer
suitable to existing organisations and change. Henri Fayol’s theory on a balanced hierarchy
shows importance of a changing hierarchical model.

However American modernist named Melville Dalton argued in his management studies that
power and decision making can be spread amongst lower ranking employees instead of
having managers to make decisions on their behalf in any hierarchy model. “the increasing
size of modern organizations and the increasing complexity of the problems with which they
have to deal makes technically impossible the participation of the rank and file in the making
of decisions.” (lilt.ilstu.edu, 1998) This quote also shows that larger organisations find it
increasing difficult to implement decisions and change.

On the other hand another classical management theorist named Max Weber believed that
organisations should have a well-defined hierarchy, a clear division of labour, rules and
regulations, impersonal relationships between managers and employee’s, competence and
records. To an extent some of Max Weber’s theory still exists in 21st century management. In
modern organisations numerous amounts of rules, regulations and company policies exist
which help prevent employees from carrying out unlawful duties internally and consequences
relating to those actions.

Rules and regulations within an organisation help prevent change from occurring to an extent,
an example of this is legislation – the Data Protection Act 1998 may prevent employees from
misplacing sensitive information within the workplace therefore rules and regulations within
an organisation to an extent are good practice measures for maintaining standardisation.

Rules and regulations to an extent also can contribute to significant change within an
organisation, for example new health and safety legislation or even employee law.

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To an extent some these models shows that the fundamental basics have been further
developed from classical and modern theorists in order to adapt to business requirements.

Furthermore during the 1885 – 1915 Scientific management was developed by Frederick
Taylor, sometimes known as the father of “scientific management”, scientific management
was aimed at improving the processes of an organisation. Scientific management theories
aimed at improving employee productivity using ‘time and motion’ studies, for example
using larger shovels in order to reduce the amount of stops between A and B.

Frederick Taylor also found in his studies that non-incentive wage systems allowed lower
productivity as workers that are receiving the same wage regardless of the output.

“Non-incentive wage systems encourage low productivity if the employee will receive the
same pay regardless of how much is produced, assuming the employee can convince the
employer that the slow pace really is a good pace for the job.” (netmba.com, 2003) this quote
also shows that employee’s tried to dodge the time and motion study in fear that employers
will set new time benchmarks.

In modern day organisations minimum wage legislation has also been introduced, this
therefore limits the productivity of its employee’s; however organisations are now
implementing targets and bonus incentive schemes which allow workers to earn above their
minimum wage.

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Question 2 human relationship approach in management

Human relations management theories were created based on the Hawthorne studies
conducted by Professor Elton Mayo.

The Hawthorne Effect is the increased motivation and productivity found in employees when
placed in a team or group setting. The human relations movement was propelled by the
Hawthorne studies. Many theorists such as McGregor, Herzberg, Vroom and others have
developed their own employee motivation beliefs and concepts. The varied hypothesis consist
of behavioral models that state the most efficient, effective and inspiring means of inciting
self motivation and high performance from employees.

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Hawthorne studies

The Hawthorne studies were conducted from 1927 until 1932 by Professor Elton Mayo at the
Western Electric Hawthorne Works in Chicago. Professor Mayo examined work conditions
and productivity. The conclusion of the research led to the discovery that relationships largely
influenced productivity. Being part of a group or team affected the performance of each
employee. The researchers dubbed the increased motivation and productivity The Hawthorne
Effect.

Human relations movement

The human relations movement originated from Dr. Elton Mayo's Hawthorne studies. The
movement stated that personal development and growth as well as employee goal setting are
essential to effective businesses. The movement also emphasized the fact that affirmative
motivation derived from team goals and greater production resulted from encouragement and
positive reinforcement from employers.

Theory X and Theory Y

Theory X and Theory Y were proposed by Douglas McGregor in his 1960 book, The Human
Side of Enterprise. The two theories are opposing methods by which supervisors perceive
employee motivation. Theory X states that people dislike work and need the constant threat
of job loss and financial incentives to work hard. These workers are irresponsible and need to
be controlled. Theory Y states that people are self-motivated, responsible, creative and need
to work. Theory Y has been adopted by more progressive management intellects that follow
Elton Mayo's human relations approach.

Hierarchy of needs

According to Maslow, McGregor's Theory Y did not completely work because it ignored the
need individuals had for Theory X. Maslow used his hierarchy of needs theory to explain
human motivation. The five levels of needs according to Maslow are physiological needs,
safety needs, needs of belonging, esteem needs and self-actualization needs. Maslow believed

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that people cannot fulfill the higher needs of esteem and self actualization without fulfilling
the basic physiological and safety needs of an individual first.

Expectancy theory of motivation

Victor Vroom developed the expectancy theory of motivation. It is based on outcomes.


Vroom surmises that effort, performance and motivation must be linked. He proposes three
variables, valence, expectancy and instrumentality. Expectancy is the thought process that
increased effort will lead to better performance. Instrumentality is the belief that you will be
rewarded for hard work, and valence is the significance an individual places on an outcome.
Vroom's theory is based on perceptions of equity or fairness in the workplace.

Two factor hygiene and motivational theory

Frederick Herzberg stated that hygiene factors such as quality of management, safety, status,
relationships, company, working conditions and company policies are necessary to keep
employees satisfied. Motivational factors like advancement, achievement, recognition, job
interest and responsibility are needed in order to motivate employees to a higher performance
level.