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Refers to the period during which a country develops an industrial economy. In Europe the Industrial Revolution began in the eighteenth century; in the United States, it began around 1860, just before the Civil War. Before the Industrial Revolution, the US economy was based on agriculture. Most people worked on small farms, using only simple technology, such as horse-drawn plows. Professional managers were not needed because most people worked for themselves.
Captains of Industry
Toward the end of the nineteenth century, powerful business people who created enormous business empires dominated and shaped the US economy. These captains of industry included John D. Rockefeller (oil), JP Morgan (banking), Andrew Carnegie (steel) and Cornelius Vanderbilt (steamships and railroads). During this period entrepreneurs founded companies that later became industrial giants. One of these companies was Bethlehem Steel. In 1863, the company began producing the first iron railroad rails; by 1899, it was selling almost $1 trillion worth of iron and steel products in a year.
Management History
By the late 1800s, the US economy depended largely on industries such as oil, steel, railroads, and manufactured goods. Many people left their farms to take jobs in factories, where professional managers supervised their work. The new industrial enterprises that emerged in the nineteenth century demanded management skills that had not been necessary earlier.
Scientific Management
Frederick Winslow Taylor(1856-1915) was the father of Scientific Management. When he was working as an apprentice at the Midvale steel company, he noticed that most workers did not work as hard as they could. To increase efficiency, Taylor tried to figure out the one best way to perform a particular task. To do so, he used a stop watch to determine which method was the most efficient. These studies were known as Time and Motion Studies.
Jobs should be designed according to scientific rules rather than rule-of-thumb methods. Employers should gather, classify, and tabulate data in order to determine the one best way of performing a task or series of tasks.
2. Employees should be selected and trained according to scientific methods. Employers should also train employees in order to improve their performance.
3. The principles of scientific management should be explained to workers. 4. Management and workers should be interdependent so that they cooperate.
Maslows Theory
Managers meet workers social needs by providing work environments in which colleagues interact by providing opportunities for co-workers to socialize with one another by providing lunch rooms or allowing employees to attend company retreats. Status needs can be met by providing employees with signs of recognition that are visible to others, such as job titles, awards, designated parking spaces, and promotions. Managers can meet employees need for selffulfillment by providing them with opportunities to be creative at work or allow them to become involved in decision making.
Theory X
MIT Professor Douglas McGregor Theory Xassumes that people are basically lazy and will avoid working if they can. To make sure that employees work, Theory X managers impose strict rules and make sure that all important decisions are made only by them.
Theory Y
Theory Y assumes that people find satisfaction in their work. Theory Y managers believe that people are creative and will come up with good ideas if encouraged to do so. They tend to give their employees much more freedom and let them make mistakes.
Theory Z
William Ouchi, a management researcher developed this new theory of management in the 1980s Theory Z is a business management theory that integrates Japanese and American business practices. The Japanese business emphasis is on collective decision making, whereas the American emphasis is on individual responsibility.
Lifetime employment Collective decision making Collective responsibility Slow evaluation and promotion Implicit (understood, implied) control mechanisms Non-specialized career path Holistic concern for employee as a person
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Short-term employment Individual decision making Individual responsibility Rapid evaluation and promotion Explicit (clear, precise, unambiguous) control mechanisms Specialized career path Segmented concern for employee as an employee.
Long-term employment Consentual, participative decision-making Individual responsibility Slow evaluation and promotion Implicit, informal control with explicit, formalized measures Moderately specialized career path Holistic concern, including family
The result of an experiment conducted at the Hawthorne plant of Western Electric in Cicero, Illinois in 1924. They lowered the lighting in the factory, expecting productivity to fall; but instead, to their astonishment, productivity increased. The researchers concluded that productivity rose because workers worked harder when they received attention. This phenomenon, in which change of any kind increases productivity, has been known as the Hawthorne Effect.
Result of study conducted in the 1950s by W. Edwards Deming who began studying how companies ensure that the products they produce are not defective. He came up with a mathematically based approach to quality control that became known as Total Quality Management, which is a system of management based on involving all employees in a constant process of improving quality and productivity by improving how they work. This approach focuses on totally satisfying both customers and employees.
TQM
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Demings Fourteen Points Create consistent purpose for improving products and services in order to remain competitive. Adopt a new philosophy. We are now living in a new economic age. Stop depending on mass inspection. Require instead that quality is built in. Consider quality as well as price in awarding business. Constantly improve the system of production and service. Institute a vigorous program of job training.
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Adopt and implement leadership. Focus on quality, not productivity. Drive out fear so that everyone may work effectively. Break down barriers between departments. Eliminate numerical goals, posters, slogans, for the work force that ask for new levels of productivity without providing new methods. Eliminate work standards that prescribe numerical quotas.
International Management
Thailand The social culture of Thailand has given rise to highly centralized corporations with strict lines of authority. Self-managed teams would not be a viable management style because workers are used to taking direction from leaders whose authority is absolute and based on status.
On the other hand, when employees were dissatisfied, they tended to cite extrinsic factors such as company policy and administration, supervision, interpersonal relationships, and working conditions. Herzberg suggested emphasizing motivators those factors that increase job satisfaction, such as recognition and growth.
Hygiene Factors
Herzbergs Theory
He believed that an individuals attitude toward his or her work can very well determine success or failure Intrinsic factors such as achievement, recognition, and responsibility were related to job satisfaction When people felt good about their work, they tended to attribute these characteristics to themselves.
McClelland found that some people have a compelling drive to succeed for personal achievement rather than for the rewards of success. High achievers perform best when they perceive that they have a 50-50 chance of success. They dislike gambling when the odds are high because they get no satisfaction from happenstance (fluke or accidental) success They also dislike low odds (high probability of success) because then there is no challenge to their skills. They like to set goals that stretch themselves a little.
Adams theory that employees perceive what they get from a job (outcomes) in relation to what they put into it (inputs) and then compare their inputoutcome ratio with the input-outcome ratios of relevant others. If workers compare themselves, a state of equity exists. They believe that their situation is fairthat justice prevails.