0MODERN MANAGEMENT THEORIES AND PRACTICES By Dr. Yasin Olum Lecturer Department of Political Science and Public Administration Makerere University… [616341]

0MODERN MANAGEMENT THEORIES AND
PRACTICES

By

Dr. Yasin Olum
Lecturer
Department of Political Science and Public Administration
Makerere University

Contact Address:

Makerere University
Faculty of Social Sciences Department of Political Scie nce and Public Administration
P. O. Box 7062 KAMPALA-Uganda Tel.(Off.): 041-531499 Tel.(Mobile): 077454019 Fax: 041-534181 E-Mail: [anonimizat]

Being a paper presented at the 15
th East African Central Banking Course, held on
12th July 2004, at Kenya School of Monetary Studies.

1MODERN MANAGEMENT THEORIES AND PRACTICES: A CRITICAL
OVERVIEW
Introduction
Managing is one of the most important human activities. From the time human
beings began forming social organizations to accomplish aims and objectives they could not accomplish as individuals, managing has been essential to ensure
the coordination of individual efforts. As society continuously relied on group
effort, and as many organized groups have become large, the task of managers
has been increasing in importance an d complexity. Henceforth, managerial
theory has become crucial in the way managers manage complex organizations.
The central thesis of this paper is that although some managers in different parts
of the world could have achieved ma nagerial success without having basic
theoretical knowledge in management, it has to be unequivocally emphasized
that those managers who have mixed ma nagement theory in their day-to-day
practice, have had better chances of managing their organizations more
efficiently and effectively to achieve both individual and organizational
objectives. Therefore, managers of contemporary organizations ought to
appreciate the important role they play in their respective organizations if they
are to achieve set goals. Secondly, there is need to promote excellence among all
persons in organizations, especia lly among managers themselves.
To address these concerns, the paper will proceed along the following spectrum: management will be defined for purposes of conceptual clarity; management
objectives, functions, goals, and essentia lity, will be highlighted; the importance
of managerial skills and the organizat ional hierarchy will be sketched; the
importance of women in the organizat ional hierarchy will be emphasized;
reasons for studying management theo ry will be enumerated; the different
management theories, the core of the paper, will be discussed at length; the

2significance of management as a practi ce will be contextualized; and ‘the way
forward’ in form of a conclusion will be offered.
Definition of Management
Management is the art, or science, of achieving goals through people. Since
managers also supervise, management can be interpreted to mean literally
“looking over” – i.e., making sure peop le do what they are supposed to do.
Managers are, therefore, expected to en sure greater productivity or, using the
current jargon, ‘continuous improvement’. More broadly, management is the proc ess of designing and maintaining an
environment in which individuals, work ing together in groups, efficiently
accomplish selected aims (Koontz and Weihrich 1990, p. 4). In its expanded form,
this basic definition means several things . First, as managers, people carry out
the managerial functions of planning , organizing, staffing, leading, and
controlling. Second, management applies to any kind of organization. Third,
management applies to managers at all organizational levels. Fourth, the aim of all managers is the same – to create surp lus. Finally, managing is concerned with
productivity – this implies e ffectiveness and efficiency.
Thus, management refers to the develo pment of bureaucracy that derives its
importance from the need for strategic planning, co-ordinat ion, directing and
controlling of large and complex decision -making process. Essentially, therefore,
management entails the acquisition of ma nagerial competence, and effectiveness
in the following key areas: problem solving, administration, human resource management, and organizational leadership. First and foremost, management is about solving problems that keep emerging
all the time in the course of an organi zation struggling to achieve its goals and

3objectives. Problem solving should be accompanied by problem identification,
analysis and the implementation of reme dies to managerial problems. Second,
administration involves following laid down procedures (although procedures
or rules should not be seen as ends in themselves) for the execution, control,
communication, delegation and crisis management. Third, human resource
management should be based on strat egic integration of human resource,
assessment of workers, and exchange of ideas between shareholders and
workers. Finally, organizational leadership should be developed along lines of
interpersonal relationship, teamwork, self-motivation to perform, emotional
strength and maturity to handle situations, personal integrity, and general management skills.
Management Objectives, Functions , Goals, and Essentiality
Management Objectives
There are basically three management ob jectives. One objective is ensuring
organizational goals and targets are met – with least cost and minimum waste. The second objective is looking after heal th and welfare, and safety of staff. The
third objective is protecting the machinery and resources of the organization,
including the human resources.

Management Functions
To understand management, it is imperative that we break it down into five
managerial functions, namely; planning , organizing, staffing, leading, and
controlling. Planning involves selecting missions and objectives and the actions to achieve
them. It requires decision-making – i.e ., choosing future courses of action from
among alternatives. Plans range from overa ll purposes and objectives to the most
detailed actions to be taken. No real pl an exists until a de cision – a commitment

4of human and material resources – has been made. In other words, before a
decision is made, all that exists is planning study, analysis, or a proposal; there is no real plan.

People working together in groups to achieve some goal must have roles to play. Generally, these roles have to be defined and structured by someone who wants to make sure that people contribute in a specific way to group effort. Organizing, therefore, is that part of management th at involves establishing an intentional
structure of roles for people to fill in an organization. Intentional in that all tasks
necessary to accomplish goals are assigned and assigned to people who can do
them best. Indeed, the purpose of an or ganizational structure is to help in
creating an environment for human performance. However, designing an organizational structure is not an easy managerial task because many problems
are encountered in making structures fit situations, including both defining the
kind of jobs that must be done and finding the people to do them.
Staffing involves filling, and keeping f illed, the positions in the organization
structure. This is done by identifying work-force requirements; inventorying the
people available; and recruiting, select ing, placing, promoting, appraising,
planning the careers of, compensating, and training or otherwise developing
both candidates and current jobholders to accomplish their tasks effectively and
efficiently.
Leading is the influencing of people so th at they will contribute to organization
and group goals; it has to do predomin antly with the interpersonal aspect of
managing. Most important problems to managers arise from people – their
desires and attitudes, their behavior as individuals and in groups. Hence, effective managers need to be effective leaders. Leading involves motivation,
leadership styles and appr oaches and communication.

5
Controlling, for example, budget for expe nse, is the measuring and correcting of
activities of subordinates to ensure that e v e n t s c o n f o r m t o p l a n s . I t m e a s u r e s
performance against goals and plans, sh ows where negative deviations exist,
and, by putting in motion actions to correct deviations, helps ensure
accomplishment of plans. Although planni ng must precede controlling, plans are
not self-achieving. Plans guide managers in the use of resources to accomplish specific goals; then activities are chec ked to determine whether they conform to
the plans. Compelling events to confor m to plans means locating the persons
who are responsible for results that diffe r from planned action and then taking
the necessary steps to improve performanc e. Thus, controlling what people do
controls organizational outcomes.

Finally, coordination is the essence of manager-ship for achieving harmony
among individual efforts toward the acco mplishment of group goals. Each of the
managerial functions discussed earlier on is an exercise contributing to
coordination. Because individuals often in terpret similar interests in different
ways, and their efforts toward mutual goals do not automatically mesh with the
efforts of others, it, thus, becomes the ce ntral task of the manager to reconcile
differences in approach, timing, effort, or interest, and to harmonize individual
goals to contribute to organizational goals. Although these management functions concern the internal environment for
performance within an organization, ma nagers must operate in the external
environment of an organizat ion as well. Clearly, managers cannot perform their
tasks well unless they have an understand ing of, and are responsive to, the many
elements of the external environment – ec onomic, technological, social, political,
and ethical factors – that affe ct their areas of operation.

6Goals of All Managers
First and foremost, the logical and publicly desirable aim of all managers in all
kinds of organizations, whether business or non-business, should be a surplus.
Thus, managers must establish an envi ronment in which people can accomplish
group goals with the least amount of time, money, materials, and personal
dissatisfaction or in which they can achiev e as much as possible of a desired goal
with available resources. In a non-business enterprise such as units of a business
(such as an accounting department) that are not responsible for total business
profits, managers still have goals and should strive to accomplish them with the minimum of resources or to accomplish as much as possible with available
resources. A manager who achieves such an aim is said to be a strategic manager. The second goal or aim of all managers is that they must be productive. Indeed,
government, and the private sector recognize the urgent need for productivity
improvement. Productivity improvement is about effectively performing the
basic managerial and non-managerial activi ties. Simply defined, productivity is
about the output-input ratio within a ti me period with due consideration for
equality.

Lastly, productivity implies effectiven ess and efficiency in individual and
organizational performance. Effectivene ss is the achievement of objectives.
Efficiency is the achievement of the ends with the least amount of resources.
Managers cannot know whether they are pr oductive unless they first know their
goals and those of the organization.

The :Essentiality of Management in Any Organization
Managers are charged with the responsibili ty of taking actions that will make it
possible for individuals to make their be st contributions to group objectives.
Thus, management applies to small and large organizations, to profit and not-

7for-profit enterprises, to manufacturing as well as service industries. However, a
given situation may differ considerably among various levels in an organization or various types of enterprises. The sco pe of authority held may vary and the
types of problems dealt with may be cons iderably different. All managers obtain
results by establishing an environm ent for effective group endeavor.
In addition, all managers carry out managerial functions. However, the time spent for each function may differ. Thus, top-level managers spend more time on
planning and organizing than do lower-level managers. Leading, on the other
hand, takes a great deal of time for first-line supervisors. The difference in the amount of time spent on controlling varies only slightly for managers at various
levels.

The manager is, therefore, the dynamic, life-giving element in every business.
Without the leadership of the manager, resources of production remain mere
resources and never become production. In a competitive economy, the quality and performance of the managers determine the success of a business; indeed, they determine its survival.

Furthermore, today, we no longer talk of “capital” and “labor”, but we talk of
“management” and “labor”. While the “re sponsibilities of capital” and the
“rights of capital” have disappeared from our vocabulary, today we hear of the
“responsibilities of management” or “prerogatives of management”.
Thus, the emergence of management as an essential, a distinct and a leading
institution is a pivotal event in social history. Management is likely to remain a basic and dominant institution as long as human civilization itself survives.
Management, which is the organ of society specifically charged with making
resources productive, that is, with th e responsibility for organized economic

8advance, reflects the basic spirit of the modern age. In fact , because management
is indispensable, this explains why it gr ew so fast and with so little opposition.
Hence, the developed and developing worlds have an immense stake in the
competence, skill and responsibility of management.

Managerial Skills and the Organizational Hierarchy
Mangers require four main kinds of skills , namely: technical, human, conceptual
and design. What do each of these skills mean?
Technical skill is knowledge of and proficiency in activities involving methods, processes, and procedures. Thus, it invo lves working with tools and specific
techniques.

Human skill is the ability to work with people; it is cooperative effort; it is teamwork; it is the creation of an envi ronment in which people feel secure and
free to express their opinions.
Conceptual skill is the ability to serve the “big picture”. It is also about
recognizing significant elements in a situation, and to understand the relationships among the elements. Design skill is the ability to solve problems in ways that will benefit the
enterprise. To be effective, particularly at upper organizational levels, managers
must be able to do more than see a proble m. In addition, they must have the skill
of a good design engineer in working out a practical solution to a problem.
Managers must also have that valuable skill of being able to design a workable
solution to the problem in the light of th e realities they face. It has, however, got
to be mentioned that the relative import ance of these skills may differ at various
levels in the organization hierarchy.

9
For purposes of elaboration, technical sk ills are of greatest importance at the
supervisory level and less at the middle- management level, human skills in the
frequent interactions with subordinates at all levels, conceptual skills not critical
for lower-level supervisors but gain in importance at the middle-management
level. At the top management level, co nceptual and design abilities and human
skills are especially valuable, but there is relatively little need for technical
abilities. The assumption, especially in l arge companies, that chief executives can
utilize the technical abilities of their su bordinates. In smaller firms, however,
technical experience may still be quite important.

Women in the Organizational Hierarchy
In recent times, women have made sign ificant progress in obtaining responsible
positions in organizations. Among the reasons for this development are laws
governing fair employment practices, ch anging societal attitudes toward women
in the workplace, and the desire of co mpanies to project a favorable image by
placing qualified women in managerial positions.

However, in some organizations, women have difficulties in making it to the top.
Besides historical reasons, discriminatio n has been one of the main reasons why
women do not make it to the top.

Why Study Management Theory?
Theories are perspectives with which people make sense of their world
experiences (Stoner et. al. 1995, pp. 31-2). Theory is a systematic grouping of interdependent concepts (mental images of anything formed by generalization
from particulars) and principles (are genera lizations or hypotheses that are tested
for accuracy and appear to be true to re flect or explain reality) that give a
framework to, or tie together, a significan t area of knowledge. Scattered data are

10not information unless the observer has knowledge of the theory that will
explain relationships. Theory is “in its lo west form a classification, a set of pigeon
holes, a filing cabinet in which fact can accumulate. Nothing is more lost than a
loose fact”(Homans 1958, p. 5).
However, the variety of approaches to management analysis, the welter of research, and the number of differing views have resulted in much confusion as to what management is, what manage ment theory and sci ence is, and how
managerial events should be analyzed. This is why some scholars have called
this situation “the management theo ry jungle”(Koontz 1961, pp. 174-188; 1962, p.
24; 1980, pp. 175-187). Since that time, the vege tation in this jungle has changed
somewhat, new approaches have developed, and older approaches have taken some new meanings with some new words attached to them, but the
developments of management science and theory still have the characteristics of
a jungle. There is a body of opinion that says th at management theory evolved during and
after Second World War; it has only been studied in-depth since then. The
industrial revolution that brought in mass production, specialization, seeing
people as critical resource, all intensified management as a critical area of discourse. Principles in management are fundament al truths, explaining relationships
between two or more sets of variables, usually an independent variable and a
dependent variable. Principles may be descriptive or predictive, and not prescriptive. That is, they describe how one variable relates to another – what
will happen when these variables interact.

11managers who apply theory to managing must usually blend principles with
realities. Once managers know about theory, they will have the capacity to
forestall future problems that may occur in the enterprise.

At this point it is worth distinguishing management theory from management techniques. Contrary to the theory we ha ve discussed above, techniques are
essentially ways of doing things; methods of accomplishing a given result. In all
fields of practice, including manageme nt, they are important. Techniques
normally reflect theory and are a means of helping managers undertake activities
most effectively. In the field of management, then, the role of theory is to provide a means of classifying significant and pertinent ma nagement knowledge. For example, in
the area of designing an effective organization structure, there are several
principles that are interrelated and that have a predictive value for managers.
The theory of management is grouped in to the five functions of management.
In sum, there are basically three main reasons why we have to study
management theory. First, theories pr ovide a stable focus for understanding
what we experience. A theory provides cr iteria for what is relevant. Second,
theories enable us to communicate effici ently and thus move into more and more
complex relationships with other people . Third, theories make it possible –
indeed, challenge us – to keep learning ab out our world. By definition, theories
have boundaries.

Management Theories
Contemporary theories of management tend to account for and help interpret the
rapidly changing nature of today’s orga nizational environmen ts. This paper will
deal with several important management th eories which are broadly classified as

12follows: The Scientific Management School comprising the works of Frederick W.
Taylor and Lillian Gilbreth’s motion study, among others; the Classical
Organizational Theory School comprising the works of Henri Fayol’s views on
administration, and Max Weber’s idea lized bureaucracy, among others;
Behavioral School comprising the work of Elton Mayo and his associates; the
Management Science School which I discuss at the end of this section; and Recent Developments in Management Theory comprising works such as Systems
Approach, Situational or Contingency th eory, Chaos theory, and Team Building
approach. For lack of time and space, this discussion will provide a general
description of some of the scholars in ea ch of these management theories and the
successes that they achieved.
Scientific Management School
The first management theory is what is popularly referred to as Frederick
Taylor’s Scientific Management. Freder ick Taylor started the era of modern
management. In the late nineteenth an d early twentieth centuries, he was
decrying the “awkward, inefficient, or ill-directed movements of men” as national loss. Taylor consistently sought to overthrow management “by rule of
thumb” and replace it with actual timed observations leading to “the one best”
practice. He also advocated the systematic training of workers in “the one best
practice” rather than allowing them person al discretion in their tasks. He further
believed that the workload would be evenly shared between the workers and
management with management performing the science and in struction and the
workers performing the labor, each group doing “the work for which it was best
suited”. Taylor’s strongest positive legacy was the concept of breaking a complex task
down into a number of subtasks, an d optimizing the performance of the
subtasks; hence, his stop-watch measured time trials. However, many critics,

13both historical and contempo rary, have pointed out that Ta ylor’s theories tend to
“dehumanize” the workers.
Nevertheless, Taylor’s postulations were strongly influenced by his
social/historical period (1856-1917) during the Industrial Revolution; it was a
period of autocratic management that saw Taylor turning to “science”(hence, his principles of scientific management) as a solution to the inefficiencies and
injustices of the period. It has to be st ated that scientific management met with
significant success among which included : the science of cutting metal, coal
shovel design that he produced at Be thlehem Steel Works (reducing the workers
needed to shovel from 500 to 140), worker incentive schemes, a piece rate system for shop management, and organizational influences in the development of the
fields of industrial engineering, personnel, and quality control.

It has to be acknowledged that from an economic standpoint, Taylorism was an
extreme success. Application of his method s yielded significant improvements in
productivity. For example, improvements such as his shovel work at Bethlehem
Works, which reduced the workers needed to shovel from 500 to 140.
Henceforth, Taylor proposed four great underlying principles of management.
First, there is need to develop a ‘scien ce of work’ to replace old rule-of-thumb
methods: pay and other rewards linked to achievement of ‘optimum goals’ –
measures of work performance and outp ut; failure to achieve these would in
contrast result in loss of earnings. Second , workers to be ‘scientifically’ selected
and developed: training each to be ‘first -class’ at some specific task. Three, the
‘science of work’ to be brought together with scientifically selected and trained
people to achieve the best results. Finall y, work and responsibility to be divided
equally between workers and management cooperating together in close
interdependence.

14
Alongside Taylor’s postulates is Gilbreth’s motion study. The ultimate result of
this study led to the centrality of efficiency in organizations. Gilbreth was
particularly interested in how he could reduce the unnecessary motions resulting
from bricklaying at a construction site ; he succeeded in reducing the motions
from 18 to 4. He then proposed that each worker should be involved in doing his
or her own work, prepare for the next high er level, and training their successors.

Classical Organizational Theory School
In this category of management th eory are the works of Max Weber’s
bureaucratic theory and Henri Fayol’s administrative theory. Weber postulated
that western civilization was shifting from “wertrational” (or value oriented)
thinking, affective action (action derived from emotions), and traditional action
(action derived from past precedent) to “zweckational” (or technocratic) thinking. He believed that civilization wa s changing to seek technically optimal
results at the expense of emotional or humanistic content.

Weber then developed a set of principles for an “ideal” bureaucracy as follows:
fixed and official jurisdictional areas, a firmly ordered hierarchy of super and
subordination, management based on wr itten records, thorough and expert
training, official activity taking prio rity over other activities and that
management of a given organization fo llows stable, knowable rules. The
bureaucracy was envisioned as a large mach ine for attaining its goals in the most
efficient manner possible. However, Weber was cautious of bureaucr acy when he observed that the more
fully realized, the more bureaucracy “depersonalizes” itself – i.e., the more
completely it succeeds in achieving the exclusion of love, hatred, and every purely personal, especially irrational and incalculable, feeling from execution of

15official tasks. Hence, Weber predicted a completely impersonal organization
with little human level interaction between its members.

Henri Fayol’s administrative theory mainly focuses on the personal duties of
management at a much more granular leve l. In other words, his work is more
directed at the management layer. Fayol believed that management had five principle roles: to forecast and plan, to organize, to command, to co-ordinate,
and to control. Forecasting and planning was the act of anticipating the future
and acting accordingly. Organization wa s the development of the institution’s
resources, both material and human. Commanding was keeping the institution’s
actions and processes running. Co-o rdination was the alignment and
harmonization of the group’s efforts. Finally, control meant that the above
activities were performed in accordance with appropriate rules and procedures.

Fayol developed fourteen principles of administration to go along with
management’s five primary roles. These pr inciples are: specialization/division of
labor, authority with responsibility, di scipline, unity of command, unity of
direction, subordination of individual interest to the general interest,
remuneration of staff, centralization, scal ar chain/line of authority, order, equity,
stability of tenure, initiative , and esprit de corps. Fayo l clearly believed personal
effort and team dynamics were part of an “ideal” organization.
Fayol’s five principle roles (Plan, Organize, Command, Co-ordinate, and
Control) of management are still actively practiced today. The concept of giving
appropriate authority with responsibility i s a l s o w i d e l y c o m m e n t e d o n a n d i s
well practiced. Unfortunately, his prin ciples of “unity of command” and “unity
of direction” are consistently violated in “matrix management”, the structure of
choice for many of today’s companies.

16Behavioral School
The key scholar under this category is El ton Mayo. The origin of behavioralism is
the human relations movement that wa s a result of the Hawthorne Works
Experiment carried out at the Western Elec tric Company, in the United States of
America that started in the early 1920s ( 1927-32). Elton Mayo and his associates’
experiments disproved Taylor’s beliefs th at science dictated that the highest
productivity was found in ‘the one best way’ and that way could be obtained by
controlled experiment. The Hawthorne studies attempted to determine the
effects of lighting on worker productivi ty. When these experiments showed no
clear correlation between light level and productivity the experiments then
started looking at other factors. These factors that were considered when Mayo
was working with a group of women included rest breaks, no rest breaks, no free meals, more hours in the work-day/w ork-week or fewer hours in the work-
day/work-week. With each of these ch anges, productivity went up. When the
women were put back to their original hours and conditions, they set a productivity record. These experiments proved five things. First, work satisfaction and hence
performance is basically not economic – depends more on working conditions
and attitudes – communications, po sitive management response and
encouragement, working environment. Se cond, it rejected Taylorism and its
emphasis on employee self-interest and the claimed over-riding incentive of
monetary rewards. Third, large-scale experiments involving over 20,000
employees showed highly positive respon ses to, for example, improvements in
working environments (e.g., improved lig hting, new welfare/rest facilities), and
expressions of thanks and encouragement as opposed to coercion from managers
and supervisors. Fourth, the influence of th e peer group is very high – hence, the
importance of informal groups within the workplace. Finally, it denounced

17‘rabble hypotheses’ that society is a hord e of unorganized individuals (acting) in
a manner calculated to secure his or her self-preservation or self-interest.
These results showed that the group dynamics and social makeup of an
organization were an extremely important force either for or against higher
productivity. This outcome caused the call for greater participation for the
workers, greater trust and openness in the working environment, and a greater attention to teams and groups in the work place. Finally, while Taylor’s impacts
were the establishment of the industri al engineering, quality control and
personnel departments, the human relations movement’s greatest impact came in what the organization’s leadership an d personnel department were doing. The
seemingly new concepts of “group dy namics”, “teamwork”, and organizational
“social systems”, all stem from Mayo’s work in the mid-1920s.

Recent Developments in Management Theory
Under this category of theory are the Systems Approach, Situational or
Contingency theory, Chaos theory, and Team Building theory.
The systems theory has had a significan t effect on management science and
understanding organizations. A system is a collection of part unified to
accomplish an overall goal. If one part of the system is removed, the nature of the
system is changed as well. A system can be looked at as having inputs (e.g.,
resources such as raw materials, money, technologies, people), processes (e.g.,
planning, organizing, motivating, and controlling), outputs (products or
services) and outcomes (e.g., enhanced quality of life or productivity for
customers/clients, productivity). System s share feedback among each of these
four aspects of the system.

18The Systems Theory may seem quite basic. Yet, decades of management training
and practices in the workplace have not fo llowed this theory. Only recently, with
tremendous changes facing organizations and how they operate, have educators
and managers come to face this new wa y of looking at things. The effect of
systems theory in management is that it helps managers to look at the
organization more broadly. It has also enabled managers to interpret patterns and events in the workplace – i.e., by enabling managers to recognize the various
parts of the organization, and, in part icular, the interrelations of the parts.

The situational or contingency theory asserts that when managers make a
decision, they must take into account a ll aspects of the current situation and act
on those aspects that are key to the situat ion at hand. Basically, it is the approach
that “it depends”. For example, if one is le ading troops in Iraq, an autocratic style
is probably best. If one is leading a hospital or University, a more participative
and facilitative leadership style is probably best. The Chaos theory is advocated by Tom Peters (1942). As ch aotic and random as
global events seem today, they are equally chaotic in organizations. Yet for many
decades, managers have acted on the basis that organizational events can always
be controlled. Thus, a new theory, kn own as chaos theory, has emerged to
recognize that events are rarely controlle d. Chaos theorists su ggest that systems
naturally go to more complexity, and as they do so, they become more volatile
and must, therefore, expend more energy to maintain that complexity. As they
expend more energy, they seek more structure to maintain stability. This trend
continues until the system sp lits, combines with another complex system or falls
apart entirely. It will need an effectiv e manager for the latter worst scenario not
to happen.

19The last management theory is the Team Building approach or theory. This
theory emphasizes quality circles, best p ractices, and continuous improvement. It
is a theory that mainly hinges on re liance on teamwork. It also emphasizes
flattening of management pyramid, and re ducing the levels of hierarchy. Finally,
it is all about consensus management – i.e. , involving more people at all levels in
decision-making.

Other Management Theories
In this category are the works of Edward W. Deming and Douglas McGregor.
Edward Deming is the founder of modern quality management and is regarded
by the Japanese as the key influence in their postwar economic miracle. He postulated several assumptions: create constancy of purpose for continual
improvement of products and service; adopt the new philosophy created in
Japan; cease dependence on mass inspec tion; build quality along with price;
improve constantly and forever every proc ess planning, production, and service;
institute modern methods of training on-the-job for including management;
adopt and institute leadership aimed at he lping people to do a better job; drive
out fear, encourage effective two-way communication; breakdown barriers
between departments and staff areas; elim inate exhortations for the workforce –
they only create adversarial relation ships; eliminate quotas and numerical
targets; remove barriers to pride of wo rkmanship, including annual appraisals
and Management by Objectives; encourag e education and self-improvement for
everyone; and define top management’s permanent commitment to ever-
improving quality and productivity and th eir obligation to implement all these
principles. Douglas McGregor (1906-1964) postulated management ideas as contained in
“Theory X” and “Theory Y”. Using human behavior research, he noted that the
way an organization runs depends on the beliefs of its managers.

20
“Theory X” gives a negative view of human behavior and management that he considered to have dominated management theory from Fayol onwards –
especially Taylorism. It also assumes th at most people are basically immature,
need direction and control, and are incapa ble of taking responsibility. They are
viewed as lazy, dislike work and need a mixture of financial inducements and
threat of loss of their job to make them work (‘carrot and stick’ mentality).

“Theory Y”, the opposite of “Theory X” , argues that people want to fulfill
themselves by seeking self-respect, se lf-development, and self-fulfillment at
work as in life in general. The six basic assumptions for ‘Theory Y’ are: work is as
natural as play or rest – the average human being does not inherently dislike
work, whether work is a source of plea sure or a punishment (to be avoided)
depends on nature of the work and its management. Second, effort at work need
not depend on threat of punishment – if committed to objectives then self-
direction and self-control rather than ex ternal controls. Third, commitment to
objectives is a function of the reward s associated with their achievement.
Satisfaction of ego and self-actualizat ion needs can be directed towards the
objectives of the organization. Fourth , the average human being learns, under
proper conditions, not only to accept bu t to seek responsibility. Fifth, high
degrees of imagination, ingenuity and cr eativity are not restricted to a narrow
group but are widely distributed in the population. Lastly, under the conditions of modern industrial life, the intellectua l potentials of the average human being
are being only partly utilized.

There is, however, one theory or approach, the quantitative approach that is
hardly used and known by managers. It emerges from operations research and
management science. It is a mathematical and statistical solution to problems
using optimization models, and computer simulations. It is most effective

21management decision-making rather than managerial behavior. The
management theories that have been discu ssed, important as they are, have to be
translated in practice by managers. To this discussion I now turn.

Management as Practice
Managing, like all other practices – whether medicine, music composition,
engineering, accountancy, or even baseball – is an art; it is know-how. It is doing
things in the light of the realities of a situation.
Yet managers can work better by us ing the organized knowledge about
management. It is this knowledge that constitutes science. However, the science
underlying managing is fairly crude and inexact. This is true because the many
variables with which managers deal are extremely complex. Nevertheless, such
management knowledge can certainly improve managerial practice. Managers who attempt to manage without management science must put their trust to luck, intuition, or what they did in the past.
In managing, as in any other field, unle ss practitioners are to learn by trial and
error, there is no place they can turn for meaningful guidance other than the
accumulated knowledge underlying their practice; this accumulated knowledge is theory.
For practical purposes, all managers must develop three sets of skills, namely;
conceptual, technical, and human (s ee Fleet and Perterson 1994, p. 25).
Conceptual skills allow the manager to develop relationships between factors
that other people may not see. Manage rs who have well-developed conceptual
skills are able to apply different management theories to the same situation. For a
manager to be technical, it implies that he or she should act professionally.
Professionalism demands that the manager performs his or her duties within

22established procedures, rules and regulations. Any behavior that compromises
the manager’s professional etiquette is certainly bound to interfere adversely
with the organization’s productivity. Lastly, a manager should be able to see
members of the organization as human beings who have needs and
psychological feelings and emotions. These needs and feelings must be positively
harnessed for the good of the organi zation; motivation of the employees,
therefore, becomes a critical factor in increasing productivity.
Conclusion
In conclusion, it has to be restated that management is the process of designing
and maintaining an enviro nment for the purpose of efficiently accomplishing
selected aims. Managers carry out the funct ions of planning, organizing, staffing,
leading, and controlling. Managing is an essential activity at all organizational
levels.
However, the managerial skills requir ed vary with organizational levels.
Although women have made progress in obtaining responsible positions, they
still have a long way to go. The goal of all managers is to create a surplus and to
be productive by achieving a favorable output-input ration within a specific time
period with due consideration for qua lity. Productivity implies effectiveness
(achieving of objectives) and efficiency (using the least amount of resources).
Managing as practice is art; organized knowledge about management is science.
The development of management theory involves the development of concepts,
principles, and techniques. There are many theories about management, and
each contributes something to our kn owledge of what managers do. Each
approach or theory has its own charac teristics and advantages as well as
limitations. The operational, or manageme nt process, approach draws on each
“school” and systematically integrates them.

23
Finally, the organization is an open syst em that operates within and interacts
with the environment. The systems appr oach to management includes inputs
from the external environment and from claimants, the transformation process,
the communication system, external factors, outputs, and a way to reenergize the
system. No doubt, a manager who makes serious attempts to translate theory
into reality is bound to increase produc tivity more than a manager who chooses
to use the ‘fire brigade’ or trial and error approach.

24BIBLIOGRAPHY

Homans G. C. (1958) The Human Group (New York: Harcout, Brace and World).
Fleet David D. Van and Peterson Tim O. (1994) Contemporary Management

(Houghton Mifflin Company), Third Edition.
Koontz Harold (1961) “T he Management Theory Jungle”, in Journal of the
Academy of Management , December.
Koontz Harold (1962) “Making Sense of Management Theory”, in Harvard
Business Review , July-August.

Koontz Harold (1980) “The Management Theory Revisited”, in Academy of
Management Review , April.
Koontz Harold and Weihrich Hein z (1990) Essentials of Management
, Fifth
Edition, McGraw-Hill.

Stoner James A. F., Freeman R. Edward, and Gilbert, Jr. Daniel R. (2003) Management
(New Delhi: Prentice-Hall of India), Sixth Edition.