The theories of management are combination of concepts and principles of management. The principle and theories of management are used in the corporate environment and it has played a significant role in developing effective policies (Karkukly, 2011). The report herewith deals with different management theories and philosophies in relation to organizational context. It further defines the application of theories of management in real business scenario for which cases of different organization are going to be explained. The main focus of present report is to search Classical and Human relations theories of management and the impact of such approaches on organizational policies. Furthermore, this unit showcases significance of knowledge and knowledge management, culture, and globalization in the real business scenario.
Application of theories of management
The application of management theories and practices is an historic concept that has gained significant interest among scholars and researchers on developing as well as on developed countries. By applying management theories and philosophies, researchers continuously discussing the issue related to divergence, universality as well as situational perspectives of management. To further extent, the western management theories are helpful in overcoming- cultural boundaries of the nations (Lawler, 2009). Culture is witnessed as the main source of management difference among most of the developing and developed countries. To overcome cultural issue in the present world of globalization the organizations are taking help and support of management theories. In the present era, theories of management are the most popular areas for studying management concepts (Schuler, 2005). However, it is not just a famous topic among management students and practitioners but also it is an interested area for the organization which is related to natural and social sciences. This is the management area which helps the corporate entities in developing business practices in consistent and in integrated manner. For example, it plays a significant role in social service management by defining specialized role and clarifying about the need of education and training for performing well. On the other hand, management philosophy helps in creating positive work climate environment and influence manager’s approach towards increasing motivation of employees at the workplace. It has been evident that management theories rely upon observation and scientific discipline that helps in constructing an effective model for business activities. However, management practice further is relied on real case scenarios and focuses on how managers deal with workplace situations. The application of such theories is seen fruitful for increasing productivity and profitability of the organization (Anttonen, 2008).
As per the view of Evans and Carson (2005), classical approaches of management is considered as a body of management which only believe that employees consider economical and physical needs which renders a support to social needs. In this structure, the management percepts that with an accomplishment of economical and physical needs of employees the management can easily meet the standards of job satisfaction (Evans and Carson, 2005). In the support of this, Karkukly (2011) has stated that it promotes the skills of employees and provides centralized decision making system in order to maximize the profit. Classical approach is also considered as a theory which mainly focuses on universal principles of operation to attain better economic efficiency.
Moreover, the Chen and Capistrano (2013) has asserted that the classical approaches can be classified as scientific, administrative and bureaucratic management. In this support, scientific management mainly focuses on single best way to accomplish allotted jobs and meeting the organisational objectives in an appropriate manner. Secondly, administrative management considers key functions of manager in order accomplish operational activities. Other than this, the bureaucratic management are the actions in which management follows diversified guidelines for effectively formulating rules, procedures and work structure (Chen and Capistrano, 2013). Werbach (2009) has argued in this context that bureaucratic management is one of the critical classical approaches which help in effectively allocating the workforce which is beneficial for organisational success.
In the support of above statements, Murthy (2012) has critically explained that with an assistance of scientific management theory the organisation can easily analyse workflow and accomplish objective of advancement in workforce productivity. In this, management focuses on the principles of efficiency which can bring some experimental advancement in work culture and production (Murthy, 2012). Evans and Carson (2005) has also contended that the administrative management is an approach in which organisations focuses on developing standard method which can be implemented in each job. During the implementation of this approach, it is necessary for management to ensure about skills and abilities of the workforce as per the designed needs of standard methods.
Human relations theories
The foundation of Human relations theories is done by Elton Mayo in the form of Human Relations Movement. The human relation theories are focused towards motivation, group motivation as well as leadership. However, in human relation theory behaviours of people is to be identified towards the management so they can be handled with effective care. To the view point of Daya and Hariga (2000) this theory assumes the relationship among employees and employers. According to the human relation theories the managers have to make and maintain effective relationship with the employees by understanding and fulfilling their needs. The main emphasis of the theory is to assess the human behaviour within organisations as well as identifying the needs people's needs as it has been witnessed that satisfaction of human needs in the organization is the major decisive factors to achieve organizational effectiveness. According to Schein and Bennis (1995) human relation theory deals with predictive nature of behaviour in organisations. It also defines how employee motivation can be achieved in the organization by creating good relation with employees and managers.
As per the views point of Araus and Slafer, (2011) there are some positive management actions that are taken while using human relations theory which also leads to employee motivation and improved performance:
- The employees are to be treated in well manner and the make felt their value in the organization.
- The objectives of an organization are to be shared with the employees.
- The employees are to be empowered to innovate and they are provided with some authority to take independent decisions.
- Training and development programs are to be designed to motivate employees.
- The employees must provide some freedom and responsibility so they can be provided a chance to grow their capabilities (Schuler, 2005).
- Appropriate recognition and rewards are to be provided to the employees for their contribution in aching business goals.
At last, this management approach focus on the use of motivational theories so as to keep employees motivated toward excellence (Human Relations Approach Case Study, 2013).
Contemporary examples of the influence of classical and human relations approaches in organizations
In the structured study of classical approaches it has been spotted that these kinds of theories can have some influence on the management actions, so it is necessary for human resource management to consider as a critical aspect. As per the view of Evans and Carson, (2005), the scientific management theory is firstly used by mechanical engineer named Taylor in order to improve efficiency of steel industry. Individual has focused on various factors of workers and identified that the workforce is having job allocation below their capacity (Evans and Carson, 2005). Taylor has also suggested that organizations decisions as per the rules of thumb and tradition can be replaced with the help of precise procedures. In this, it is essential for human resource management to analyze the individual situations in a better way for effective assistance of precise procedures.
Chopra and Yano (2004) has stated that in current market scenario the numbers of steel producers are focusing on scientific management approach. Such as Sheffield Forgemasters is one of biggest steel producer in United Kingdom, Company is focusing on pig iron approach of Taylor. In this, human resource management ensures that the workers are receiving proper resting hours in order to reduce the exhausted conditions at the workplace (Chopra and Yano, 2004). It increases the productivity of business organization and help in determining optimal timing for better success.
Moreover, Gorman (2010) has states that number of auto-mobile and manufacturing organizations like Volkswagen is also focusing on this approach in order to boost the productivity. In order to increase productivity, the management of Volkswagen is offering various rewards and increment in pay if person accomplish job in an optimal manner. In this respect, Gorman (2010) has also concluded that the scientific theory is beneficial for advancement in productivity by analyzing capabilities, motivation and rewards. However, scientific theory also states that the work efficiency is influenced due to lack of standard tools, techniques, mismatch bweteen job and skills and lack of motivation. It is the one of key reason that auto-mobile industry is focusing on upgrading technology and motivation for better efficiency.
Ci-sheng (2012) has stated that the administrative theory is also used by various multinational organizations in order to have better success. For example, Google is highly contributing in administrative theory in its management operations. Human resource management of Google has understood a distinction between technical and managerial skills which has assisted in effective identification of diverse funcational strength. Management is focusing on continoues development of management process with an assistance of various principles of management (Gorman, 2010). Moreover, human resource management of Google is also focusing on various principles like allocation of workforce, responsibility, centralization, unity, coordination, initiative, remuneration and interest.
Ci-sheng (2012) has asserted that the bureaucratic management means employee selection and improvement is according to competences and technical qualification. Managers are accountable for various rules and procedures. The jobs are allocated in hierarchial manner and every decision is recorded in written manner. In current market bureaucracy is considered as negative aspect so it is not much common now a days but new business setups and small business organisations are adopting it as a intitial stage of management.
According to research investigation Dininni (2011) An experiments undertaken by Mayo at Hawthorne plant, USA in the year of 1930. The application of this approach at the workplace represented that the managers as well as company have to take interest in employees and provided them effective care because, it leads to motivation. The allocation of human relation theory in the organization has revealed that if company will put significant focus of the employees then they will fell more valued and empowered. The finding of author has presented that employees often perform well in teams. Further, it has been showed that the employees will be motivated when they will be managed and consulted more. This management theory assumes that the employees are different than more autocratic management theories. In this regard the management theory designed by Professor Douglas McGregor namely X and Y Theories in which theory Y represents that people like to work when they fell responsible and self-motivated. This is all done when they will understand their position within the company and in corporate structure (Ahire, 2001). On the other hand , theory X represents that employees are lazy and unmotivated, they are not committed for the organizational success and they need to be in discipline. In short, it can be said that human relations theory not only focuses towards organizational development as well as it is also strictly focused towards employee prosper and development. ARM Holdings plc, a British multinational semiconductor and software design company is focused towards developing effective human relations.
This organization is the biggest example of using management approaches to design the policies. The major focus area of company is to develop its employees as a part of companies business strategy. It has been witnessed that the workforce at ARM work within a learning and development teams and the employees are considered to be internal customers (An ARM case study, 2012). While following the aspects of human relation theories, the managers of company are focused towards motivating individual as well as teams. For this purpose, the employees are communicated with the vision of ARM company, its values and strategy so that the employees can be worked at the same level. The workforce is provided with effective training and induction with the aim of developing their skills, confidence and self-reliance (An ARM case study, 2012). Regular meeting are to be conducted between managers and employees so that problems faced by individuals can be recognised as well as they can be provide chance come up with innovative ideas. Furthermore, to review the employee performance effective system is designed and they are communicated with set personal and team objectives.
Impact of management approaches on organizational policies
According to Ci-sheng (2012) the management approaches have great level of influence on the organizational policies. With an improved focus on classical approaches of management the business organizations can have effective application of knowledge and personnel skills in order to accomplish organizational goals in better way. In the support of this, Armstrong (2009) has also contented that the it provides practical application of diverse skills in the workplace which improves overall operational effectiveness. For example, the improved level of knowledge and skills will facilitate in better formation of organizational policies so that goals can be accomplished in better way.
As per the view of Fojt (2000), the classical and other management approaches provides better opportunity to situation analysis which is beneficial for effective formation of organizational policies. Employees can have continuous practice will impact operational actions in positive manner. Ci-sheng (2012) has argued that management approaches provides better observation and findings in context of organizational policies which is beneficial for reflection of key principles within organization. It provides better strength to managerial actions which will enhance the productivity of organizational policies. Management theories provides systematized body of knowledge which will help in effective identification of issues and facilitate in effective designing of strategies and policies as per needs.
Gorman (2010) has also critically explained that the principles and theories can be applied in every section of management which will enhance the practical experience as well as theoretical research. Management can also have better application of diverse management principles in order to meet the organizational goals. As per the view of Gorman (2010), with an assistance of management theories the governing bodies within firm can easily understand the cultural aspects. It will assist management of business organizations to develop strategies and policies as per the needs of organizational culture. Effective development of organizational policies as per the consideration of business culture will facilitate in better development of organization.
Moreover, Chopra and Yano (2004) has also concluded that the management theories also provide better decision making opportunities which is beneficial for effective formulation of organizational policies. It provides an effective communication mechanism which facilitates the managers and workforce to take familiar decisions. It is due to effective understanding of business and operational activities. Evans and Carson, (2005) has argued that the management theories also provide information regarding risk taking factor present among employees. Management can easily understand the level of comfort in respect of risk taking actions and assist in bring various kinds of innovation within organizational standards. It will facilitate in better work management and designing of organizational policies.
Other than this, management approaches also facilitates in change management actions which impacts the existing organizational policies in better way. McLean (2005) has contented that companies can easily manage the organizational behavior with an assistance of management theories which also have direct positive influence on the organizational polices. It also provides diverse advantages of reward system and policies which increases the motivation level among employees. In this support Ci-sheng (2012) has concluded that increased level of motivation among employees increases the morale of workforce and provide better application of organizational policies. It also motivates employees to share views with management which is beneficial for effective designing of organizational policies as per employees expectations in order to meet the organizational goals.
Moreover, with an assistance of human resource management approaches the business organizations can have great improvement in operational actions which is beneficial for effective formulation of organizational policies. In the support of this, Harris (2003) has asserted that it allows business to use various motivational theories like Mashlows motivation theory, etc. With an improved focus on this approach of human relations the management can easily identify the employees needs. Policies can be designed as per employees expectations which will also enhance the employees motivation level in order to boost productivity. McLean (2005) has critically suggested that the reward policies can also be used in order to boost the human relations. It facilitates in effective advancement of key work structure by enhancing the coordination level among management and employees. It also promotes the trust factor within organization which is beneficial for effective application of organizational policies.
As per the view of Harris (2003) the human relations approaches also plays key role in improvement of employee retention rate which is beneficial for better effective operational activities. It provides a better strength to application of organizational policies and lead business to sustainable development. It also assist in better identification of ways which can easily overcome the barriers and issues in application of organizational policies.
The organizational policies are designed in context with different management approaches. According to human relation approach the needs of individual are to be satisfied after analyzing its behaviors towards the organization. Considering the human relation approach the company designs policies so that long term relations can be developed with the employees. The organization also decides for monetary and non monetary rewards and decides the leadership style through taking help of human relation theory of management.
The above report explained about the application of management theories and philosophies to the real business context. From the report analysis it has been witnessed that the management theories are applicable to organizations for improving the performance and productivity. It can be concluded that classical theories are used for efficiency, higher quality, cost reduction on the other hand human relation theories focuses on improving management-worker relationships so that employees can be motivated for higher performance.
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