2011.02.cesa sustain 02
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TRANSCRIPT
REVIEW
Strategic Stretch
Creative Destruction
Groupthink
3 Common Mistakes of Management
1. Too self satisfied2. Lack of Change3. Underestimate Significance of Vision
3 Common Mistakes of Management
WEEK TWO
Prof. K.B Akhilesh,
Dept. of Management Studies, IISc Bangalore
“Unless you build culture, unless you build rituals, unless you build collective mindsets, it is very difficult to sustain the performance of the organization”
Book: Scott’s Three Levels of Analysis
Social Psychological
Structural
Macro
Book: Three Focuses
Performance of tasks
Motivation
Adjustment of
Surroundings
High performance leading organizations are increasingly distinguished by 7 features
Management Development
Management Development
1. Linking management development to plans and strategies.
2. Being boundless, flat, nonhierarchical
3. Using global and cross cultural orientation
4. Individualizing learning focused on organizational learning
5. Applying customized training aligned with corporate culture
6. Employing a career development focus
7. Focusing on the development of core competencies.
Development of Management
Classical approach: 2 perspectives:SCIENTIFIC MANAGEMENT concentrated
on the problems of lower-level managers
CLASSICAL ORGANIZATION
AL theory focused on problems of
top-level managers.
Problem business was
expanding and creating new products and new markets,
labor was in short supply.
Solutions
substitute capital for labor
use labor more efficiently.
“The Father of Scientific Manageme
nt”
Maximize worker
capacity and profits
PROBLEM: GET
EMPLOYEES TO THEIR MAXIMUM CAPACITY
PRIMARY FOCUS: TASKS
Frederick Taylor (1856-1915)
Elements of Scientific Management
Scientific design of every aspect of every task• Time and
Motion Studies
Careful selection
and training of every task
Proper remuneration for fast and high-quality work• Maximize
output - increase pay
Equal division of work and
responsibility between
worker and manager
Underlying Themes
Managers are intelligent; workers are
and should be ignorant
Provide opportunities for workers to
achieve greater financial rewards
Workers are motivated
almost solely by wages
Maximum effort =
Higher wages
Manager is responsible for
planning, training, and evaluating
Application in the Modern Workplace
Assembly Line Plants
as Prototypical Examples
“Prisoners of
Taylorism”
System of Remuneration (quotas
- commissio
n)
Re-Design – Reengineer
ing
Application in the Modern Workplace
Benchmarking
Data are used to refine, improve, change,
modify, and eliminate
organizational processes
Lean Manufacturin
g
Henri Fayol (1841-1925)
General and Industrial
Management
Principles and Elements of
Management - how managers
should accomplish
their managerial
duties
PRIMARY FOCUS:
Management
More Respect for Worker than Taylor• Workers are
motivated by more than money
• Equity in worker treatment
Five Elements of Management -- Managerial Objectives
Planning
Organizing
Command Coordination
Control
Fourteen Principles of Management (Tools for Accomplishing Objectives)
1. Division of work - limited set of tasks2. Authority and Responsibility - right to give orders3. Discipline - agreements and sanctions4. Unity of Command - only one supervisor5. Unity of Direction - one manager per set of activities6. Subordination of Individual Interest to General Interest7. Remuneration of Personnel - fair price for services8. Centralization - reduce importance of subordinate’s role9. Scalar Chain - Fayol’s bridge10. Order - effective and efficient operations11. Equity - kindliness and justice12. Stability of Tenure of Personnel - sufficient time for
familiarity13. Initiative - managers should rely on workers’ initiative14. Esprit de corps - “union is strength” “loyal members”
Fourteen Principles of Management (Tools for Accomplishing Objectives)
Unity of Direction - one manager per set of activities
Subordination of Individual Interest to General Interest
Remuneration of Personnel - fair price for services
Centralization - reduce importance of subordinate’s
role
Scalar Chain - Fayol’s bridge
Order - effective and efficient operations
Fourteen Principles of Management (Tools for Accomplishing Objectives)
Equity - kindliness and justice
Stability of Tenure of
Personnel - sufficient time for
familiarity
Initiative - managers should rely
on workers’ initiative
Esprit de corps -
“union is strength”
“loyal members”
Fayol’s Administrative Theory
Positioned communication as a necessary ingredient to successful management
Application in the Modern Workpla
ce
Fayol’s elements of
management are recognized
as the main objectives of
modern managers
Planning - more
participatory
Organizing - human
relationships and
communication
IMPORTANT TABLE 2.1 Compariso
n of Managerial
Skills (p. 32)
Especially applicable for large
organizations
(military)
Weber’s Theory of Bureaucracy
Max Weber (1864-1920) German Sociologist Theory of Social and Economic Organization
(1947) Principles and Elements of Management -
describe an ideal or pure form of organizational structure (general policy and specific commands
PRIMARY FOCUS: Organizational Structure Worker should respect the “right” of managers
to direct activities dictated by organizational rules and procedures
29
Weber’s Ideal Bureaucracy
Exhibit 2.4
Q: Are bureaucracies alive today?
Weber’s Theory of Bureaucracy
Bureaucracy allows for the optimal form of authority - “rational authority”
Three types of Legitimate Authority Traditional Authority - past customs; personal
loyalty Charismatic Authority - personal trust in
character and skills Rational Authority - rational application of rules
or laws
Tenets of Bureaucracy
Rules
Specified sphere of competency
Hierarchy
Specialized Training
Workers do not own technology
No entitlement to “official position” by incumbent
Everything written down
Maintenance of “ideal type” - bureaucracy
Weber’s Theory of Bureaucracy
Concerned with describing the ideal structure of an organization
Cornerstone: existence of written rules
Weber’s Theory of Bureaucracy
The rational application of written rules ensures the promotion of legitimate authority and the effective and efficient functioning of the organization.
Application in the Modern Workplace
Large organizations guided by countless rules are bureaucracies
Linked with inefficient, slow-moving organizations
Organizations have several characteristics of bureaucracies
35
“Modern Times”Discussion Questions
What evidence did you see of Scientific Management (SM)?
What is the intention of the movie?
What evidence did you see of a bureaucracy?
What are the benefits of SM/bureaucracy?
What are the drawbacks of SM/bureaucracy?
1927-1933 WESTERN ELECTRIC CO.
Cicero, IllinoisHawthorn PlantDr. Elton Mayo
Hawthorne Studies
¨ Conducted in late 1920’s¨ Western Electric Hawthorne plant¨ Showed importance of the
individual in the workplace¨ Showed the presence of a social
system in the workplace
Hawthorne studies defined
• A series of experiments in which the output of the workers was observed to increase as a result of improved treatment by their managers.
• Named for their site, at the Western Electric Company plant in Hawthorne, Illinois.
• Originally intended to examine effects of lighting on productivity– Scientific management proposed that physical
conditions affect productivity
• Result: Productivity increased regardless of lighting level
• Conclusion: Increased productivity was due to workers’ receiving attention
Hawthorne Studies: Workplace Lighting
Illumination Studies
• The first illumination study was made in three departments
• The illumination level in each department was increased at stated intervals
• Puzzling results– Increased production did not correspond with
increased lighting– Reduced production did not correspond with
reduced lighting
Illumination Studies
• The second illumination study utilized a test group and a control group.
• Illumination intensities were varied in the test group and compared to the control group.
• Both groups showed increases in production rates that were not only substantial but also nearly identical.
Illumination Studies
• The third illumination study reduced the lighting for the test group and held the control group constant.
• Efficiency of both groups increased.• Production rates increased in the test
group until the light became so poor that the workers complained.
Illumination Studies
• Conclusions:– Employee output was not necessarily related
to lighting conditions, and– Too many variables had not been controlled
in the experiments.
¨ Examined effects of group piecework pay system on productivity
¨ Workers under piecework system should produce as much as possible¨ Scientific management assumes that people are
motivated only by money
¨ Result: Production less than maximum¨ Conclusion: Social pressure caused workers to
produce at group-norm level
Hawthorne Studies: Piecework Pay
ILLUMINATION STUDYILLUMINATION STUDY
RELAY ROOM STUDYRELAY ROOM STUDY
BANK WIRINGBANK WIRING
Elton Mayo &Fritz Roethlisberger
Elton Mayo &Fritz Roethlisberger
Study Background
• Hawthorne studies were conducted from 1927 to 1932 by HARVARD BUSINESS SCHOOL PROFESSOR ELTON MAYO.
• Purpose of study was to EXAMINE WHAT EFFECT MONOTONY AND FATIGUE had on productivity and how to control them with variables such as rest breaks, work hours, temperature, and humidity.
Normal conditions
• Under normal conditions, the work week was 48 hours, including Saturdays. There were no rest pauses.
Experiment One
• The workers were put on piece-work for eight weeks.
• Output went up.
Experiment Two
• The workers were given two rest pauses, five minutes each, in the morning and afternoon for a period of five weeks.
• Output went up again.
Experiment Three
• The rest pauses were increased to ten minutes each.
• Output went up sharply.
Experiment Four
• The workers were given six five minute breaks.
• Output fell slightly.
• The workers complained that the work rhythm was broken by frequent pauses.
Experiment Five
• The two original rest pauses were put back in place, and the workers were given a free hot meal by the company.
• Output went up.
Experiment Six
• The workers were dismissed at 4:30 p.m. instead of 5:00 p.m.
• Output went up.
Experiment Seven
• The workers were dismissed at 4:00 p.m.
• Output remained the same.
Experiment Eight
• All improvements were taken away and the workers returned to their original working conditions.
• Output was the highest ever recorded!
CONCLUSION
Level of production is set by social norms, not by physical capacities
Non-economic rewards and sanctions affect the behavior of workers
Often workers react as members of a group, not as individuals
Management should recognize group behavior and act accordingly
Hawthorne Studies
Hawthorne Effect:The phenomenon that employees perform better when they feel singled out for attention or feel that management is concerned about their welfare
THE HAWTHORNE STUDIES:SOME PUZZLING RESULTS
100
108
116
124
132
Standard workconditions
Tw
o 5-
min
. res
ts
Tw
o 1
0-m
in. r
ests
Six
5-m
in. r
ests
15-m
in. r
ests
+ lu
nch
Sam
e +
4:3
0 p
.m. s
top
Sam
e +
4 p
.m. s
top
15-m
in. r
ests
+ lu
nch
Sam
e +
Sat
. a.m
. off
Sta
nd
ard
15-m
in. r
ests
+ lu
nch
In general, productivityincreased with each change
in work conditions
Per
cen
tage
of
Sta
nd
ard
Ou
tpu
t
Hawthorne Study Results
Test Room/Control Room– Changes to work conditions do not produce linear
responses to productivity.– Workers appear to respond to management’s attempts to
improve work place.
Bank Wiring Room– Workers will scale back productivity to suit group norm.– Organizations are social systems in which human
interactions play a critical role.
Explanation of Findings
• The experimental group had considerable freedom of movement compared to other workers in the plant.
• The group developed an increased sense of responsibility and discipline no longer needed to come from a higher authority, it came from within the group.
Real World Example
• Workers improve their productivity when they believe management is concerned with their welfare and pay particular attention to them.
• Productivity can also be explained by paying attention to the workers’ social environment and informal groupings.
An Exercise
• What kinds of issues affect your productivity?• What can a principal/superintendent do to
increase or decrease your productivity?