Scientific Administration (Frederick W. Taylor)
It was the first administrative theory. - It originates under the concern of creating a science of administration (method of observation and measurement). - It is based fundamentally on the tasks of the organization. - Time and movements study. - Division of tasks, specialization of them. - Elimination of waste, leisure time and reduction of production costs. - Motivation of workers through salary incentive plans. - Selection and training of personnel. - Atmosphere of management-worker cooperation.
Classical Theory of Administration (Henri Fayol)
- Defines the basic functions of the company. - Conceptualizes the administration (foresee, organize, direct, coordinate and control). - It defines the general principles of administration as universal procedures applicable in any type of organization. - There is a proportionality of the administrative function that is distributed at all levels of the company. - Emphasis on the structure of the organization, understood as an arrangement of the parts that constitute it, its form and the interrelation between them. - The division of labor (vertical or horizontal) and the corresponding specialization of the parts. - Existence of line organs and staff organs.
Theory of Human Relations (Hawthorne-Mayo)
- Comes up with the Hawthorne experiment. - Hawthorne's experiment marks throughout its development the beginning of a theory loaded with humanistic values in the administration. - Transfers concern for homework and structure to concern for people. - New words are included in the administration dictionary: integration and social behavior of employees, psychological and social needs, non-material rewards and sanctions, the study of
informal groups, among others. - It is essential to harmonize the two basic functions of industrial organizations: the economic function (producing goods or services to guarantee external balance) and the social function (distributing satisfactors among workers to guarantee internal balance).
Industrial psychology
The worker is a conglomerate of traits that can be measured to accurately determine its value and make appropriate selection and job placement decisions. These traits include skills and attitudes.
Human relations
The proof of the manager's success is his ability to organize human cooperation. The individual must feel that their work is socially necessary and appreciated. The management elite requires systematic training in human skills: intensive communication sessions and evaluations through questionnaires and interviews. The contact between supervisors and subordinates allows this mythical entity that employees call “the company” to be endowed with kindness, consideration, fairness and competence.
Basic functions of the organization, according to Roethlisberger and Dickson
Industrial organization:
- Economic function: Produce goods or services - External balance Social function: Provide satisfaction to participants - Internal balance
Theory X and Y (McGregor)
Two styles of management can be distinguished: authoritarian (X) and participatory (Y). Today the Y style tends to favor and even demand itself, but many X managers are very successful.
Theory X
- Intrinsic disgust towards work. Obligation to work. Little ambition.
Theory Y
- The common human being does not essentially dislike working. Man must direct and control himself. He commits himself according to the compensations associated with his achievement. The ability to develop relatively high imagination, ingenuity and creative capacity.
Sensitivity Workouts (T groups)
The qualities of a participatory manager can be developed. A typical session consists of placing a dozen people in a room, without a leader or agenda. Feedback would make managers less authoritative and more participatory.
T groups are instruments for change, essentially controlled, that provide opportunities for self-knowledge and self-development. They increase self-awareness and perception of the influence of one's behavior on others.
Project Management (PERT and CPM)
Analysis of project activities allows finding a critical path to save time, effort and money. This technique, originally used by the military, contributed to understanding and eliminating bottlenecks, but it became less attractive due to its excessive complexity.
Management by Exception
Management must focus on deviations from established standards. This idea, popular in the early days of information technology, is still used (without the name) when reviewing "deviation reports"
Management by Objectives
The manager's task is to link, closely and formally, individual performance goals with company goals. It is on this idea that the practice of annually setting “goals and targets” for employees is based. The danger is excessive formalization.
The ten deadly sins to fail in Management by objective, according to John W. Humble, are:
- Do not obtain participation from senior management. - Tell everyone that Management by objective is a supreme technique capable of solving problems. - Adopt Management by objective within an accelerated program. - Set only quantifiable goals. - Simplify all procedures to the extreme. - Apply Management by objectives in isolated areas, that is, not to make the company participate globally. - Delegate the entire Management project by objective to lower level personnel. - Focus on individuals and ignore problems in groups. - Launch the system with a party and then leave it alone. - Ignore the personal goals of managers, concentrating only on the objectives of the company.
Significant Learning Activity:
The section must be divided into 3 work teams, where each one must form an organization (simulated) where COGESTIÓN predominates, said organization will be for profit and its work will be purely environmentalist.
The management of said organization will be by OBJECTIVES, for which the definitions of: goals, organizational structure, subordinate and feedback. In addition, management will be combined with a Mac Gregor X or Y style and some of the management tools provided by scientific management and the theory of human relations will be applied.
In this way, in summary, the work teams must deliver a descriptive report, type case study that explains how the creation would be
and development of an organization that EVIDENCE:
- Use of co-management.
- Development through Management by objectives.
- Establishment of an X or Y style in their policies.
- Use of management tools provided by scientific management and the theory of human relations.
NOTE: Currently, the current management does not handle the terms of organizational structure, subordinate and feedback replaced by organization chart, worker or employee and feedback respectively.
Matrix organization
During the 1960s, a rare organizational arrangement known as the matrix organization was used.
A matrix organization is an organizational approach that assigns specialists from different functional departments to work on one or more projects led by a project manager.
The matrix structure creates a double chain of command that explicitly violates the classical principle of unity of command. Functional departmentalization is used to improve on the economics of specialization. But, parallel to the functional departments, there are a series of managers who are responsible for specific products, projects or programs within the organization.
Along the vertical dimension, the various projects that the company is developing are added. Each project is directed by a manager who integrates staff from each of the functional departments. The inclusion of this vertical dimension to the traditional horizontal functional departments, intertwines the elements of functional and product departmentalization, hence the term matrix or matrix.
The employees in the matrix have two managers: the head of the functional department and the project manager. Project managers have authority over the functional members who are part of that project team. Authority is shared between the two managers.
To work effectively, the two managers must communicate regularly and coordinate common employee demands.
Zero Base Budget
The goal is to break the practice of using the previous budget as the basis for adding expenses. For this, the level of spending required to keep the business alive and justify any increase or expense must be established.
Product Life Cycle
Products follow predictable life cycles: adoption, growth, stagnation, and decline. Managers must recognize the phase and act accordingly. This idea comes and goes in business: it is a useful concept, but dangerous when followed dogmatically (finance or abandon prematurely).
Example of management application according to the Product Life Cycle
When a product or service is introduced to the market, a “Presentation, which talks about it, its
characteristics, virtues, uses and advantages is required;
On the other hand, when the product or service begins to move from growth to maturity, it can be switched to a “Maintenance” campaign, where the persuasion factor is paramount.
Here, the public already knows the product and the market is populated with competition. So you need a message that convinces you, that seduces you above others.
Finally, when the product is fully at its level of maturity, you must pay for “Remembrance” advertising, that is, it is enough to see the brand or slogan for users to keep it in mind.
Learning curve
Learning curves or, as they are sometimes called, experience curves, are based on the premise that organizations, like people, do their jobs better as they are repeated.
Portfolio Management
During the seventies and eighties the expressions "stars", "cows", "dogs" and "unknowns" were very popular
The working population of an organization should be viewed and managed as an investment portfolio, a set of valuable assets represented by an asset account in the accounting books. Accordingly, the same investment portfolio management principles apply to human resource management, these are:
The remarkable fact is that the theory of human capital has entered the corporate world and the challenge for general management is to disseminate and instill that philosophy in managerial practices. Management could adopt the following matrix for the qualification of its human resources:
- High potential employees Consistent performance but limited potential employees High potential employees but with problematic attitudes Low potential and performance employees
Theory Z (Ouchi)
Theory Z is participatory and based on human relationships, it aims to understand the worker as an integral being who cannot separate his work life from his personal life, for this reason he invokes certain special conditions such as trust, teamwork, employment for life, close personal relationships and collective decision-making, all applied in order to obtain a higher return on human resources and thus achieve greater business productivity, is about creating a new humanistic business philosophy in which the company is find yourself committed to your people.
FUNDAMENTAL PRINCIPLES OF THEORY Z
Trust • Attention to human relationships • Close social relationships
HOW TO DEVELOP THE CULTURE OF COMPANY Z
Ouchi identified the following thirteen steps to transform the organization into a Z company:
1.- First understand the Type Z of organization and the role that the participants have to play in the transformation.
2.- Re-evaluate the philosophy established in the organization about to transform.
3.- Define the new philosophy to implement and involve the board of directors of the new direction to be taken.
4.- Begin implementation by creating structures and incentives.
5.- Develop personal ties between the participants of the new organization.
6.- Re-evaluate progress up to this point.
7.- Participate the union in the process.
8.- Stabilize the number and categories of employees.
9.- Establish the (slow) system for evaluating and promoting workers.
10.- Expand and generalize the careers of workers.
11.- Final implementation up to this point.
12.- Promote the participation and dedication of the workers to the organization.
13.- Promote fully enveloping dedication among employees. This includes all aspects of their social and family life.
Significant Learning Activity:
Suppose you were a Graduate in Environmental Management and were designated for your abilities and achievements as Director of the Ministry of the Environment in the state of Táchira. Now, assuming that you decide to apply THEORY Z in your management within the ministry, indicate what your operational plan will be for this application to be carried out (use the format shown).
TIP: Link the objectives with the steps proposed by OUCHI (See PDF)
Quality circles
Quality circles seek to improve the quality of work and the quality of life at work, increasing the degree of participation of workers in the control and administration of the company, arguing that teamwork fosters satisfaction and creativity individual.
Quality circles rely primarily on three general principles. The first is that group work is inherent to every society in which the identity of the person is, to a large extent, determined by the group or groups to which she belongs. A universal principle is that the human being is a social being, not an individual being. The second general principle is that no one can know the job better than the one who does it on a daily basis. A third principle, and this one of a more operational nature, is that one's best idea is always inferior to the group's idea.
Self-Directed Teams
A self-directed work team (ETAD) is a small number of people, who share complementary knowledge, skills and experiences and who, committed to a common purpose, set realistic, challenging goals and an efficient way to achieve them, also shared, ensuring timely results, predictable and quality, for which the members are mutually responsible.
This unique way of working, producing results interdependently, is what makes it possible for the team's performance to be qualitatively superior to the sum of the individual contributions and tasks carried out by its members. But the team's performance is also superior, because superior are the values of its members.
Competitiveness
Companies must identify the critical elements of their business success (costs or differentiation) and focus on one but not all of them.
When you think about the main objective or result that organizations of any kind, whether public or private, large, medium, small or micro, seek to achieve; For-profit or non-profit, the first thing that comes to mind is the concept of productivity, understood as the ability to generate goods or services with a minimum of errors or chronic waste and maximizing the benefits of all kinds that can be obtained. In accordance with the above, it can be said that, for an Organization to obtain the desired level of productivity, it will need to comply with two important characteristics: being efficient and effective at the same time.
Just in time
It is an industrial philosophy, which considers the reduction or elimination of everything that involves waste in the activities of purchasing, manufacturing, distribution and support for manufacturing (office activities) in a business.
Just in time implies producing only exactly what is necessary to meet the goals requested by the client, that is, producing the minimum number of units at the last possible moment, eliminating the need for storage, since the minimum and sufficient stocks arrive just in time for replenish those that have just been used and the disposal of finished product inventory.
Downsizing
Form of reorganization or restructuring of companies by means of which an improvement in work systems, organizational redesign and the adequate establishment of the staff are carried out to maintain competitiveness.
Types
Reactive: Responds to change, sometimes, without careful study of the situation. The problems that derive from this position are often predictable: reduction of staff by response only, without an adequate diagnosis, inadequate work environment and climate, damages are costly and a high negative impact on the efficiency of the company.
Proactive: It is a process of anticipation and preparation for eventual changes in the environment, this type of option enables results and effects more quickly and requires strategic criteria based on the idea of rethinking the company.
It means a reduction in the number of personnel, but, in general, it expresses a series of strategies oriented to Rightsizing (achieving the optimal organizational size) and / or rethinking (rethinking the organization).
Empowerment
This term is used to express the participation and initiative of the worker. In theory, people don't just want to follow orders. Empowerment is sensible, when it is accompanied by responsibility for the results; otherwise, it is a recipe for anarchy and underperformance.
Empowerment means empowerment or empowerment which is the fact of delegating power and authority to subordinates and giving them the feeling that they own their own work.
Benchmarking
Benchmarking is a business management technique that aims to discover and define the aspects that make one company more profitable than another, and then adapt the knowledge acquired to the characteristics of our own company.
What should be clear is that benchmarking does not imply practices outside the law. This technique has nothing to do with industrial espionage or copying, nor should it result in a sudden change in the corporate culture that governs the organization itself, but rather collect enough information in order to be able to negotiate under the best conditions with all the involved in the value creation processes of a company; make the competition tougher to others, and discover new market niches.
ISO 9000
This quality assurance program is required by many companies to qualify suppliers. It is necessary to meet standards and analyze processes to ensure that it can produce sustained results. It is difficult and sometimes complex to fulfill this "recipe" for quality.
The ISO 9000 family of standards is a set of quality standards established by the International Organization for
Standardization (ISO) that can be applied in any type of organization (production company, service company,
public administration…).
Its implantation in these organizations, a hard work, supposes a great amount of advantages for its companies. The
main benefits are:
1. Reduction of rejections and incidents in the production or provision of the service.
2. Increased productivity
3. Greater commitment to customer requirements.
4. Continuous improvement.
Reengineering
It consists of redefining all processes, to eliminate unnecessary and expensive steps.
Hammer and Champy define process reengineering as "the fundamental reconception and radical redesign of business processes to achieve dramatic improvements in performance measures such as cost, quality, service, and speed."
High Performance Organizations
The organization of the future is based on teams that have the various skills necessary for a project and dissolve when completing the task. This concept works when the mission is clear and when small teams are involved. The question is how to maintain a high performance atmosphere.
Visionary Companies
Successful companies set goals and achieve them. The important thing is to define a long-term goal (ten years or more), with progress measurement points. Many have set goals capable of inspiring employees, but drop them in a few years. Careful selection of the goal and constant pressure from above are necessary.
Learning Organizations (OQA)
In place of the classic model of business organization, which assumes that the company has a formula or design to carry out its activity, as well as a hierarchical structure and a group of rules or policies, the Learning Organizations (OQA) understand that any formula is provisional and needs to be continually reviewed to accommodate rapid changes occurring between competitors and the industry environment.
Rather than the classic bureaucratic model, which aims to recruit “parts” for a well-oiled machine, OQAs are looking for workers who can contribute as creative active participants to the revision and adaptation of the formula and operating rules.
OQAs therefore constitute living communities that take advantage of the learning capacity of their members and are open to changes in their structure, that is, they are capable of continually redesigning themselves. They provide three levels of learning: individual, group, and organizational, with the common goal of not only doing the tasks better, but building a solid knowledge base and continually reviewing processes and products.
Organizations must constantly learn new modes of action, or they atrophy. But corporations are averse to change, unless they are in dire straits. Successful companies do not encourage employees to question practices.
Characteristics of an OQA
Four fundamental factors that characterize an OQA have been identified:
- Learning culture: an organizational climate that nurtures and stimulates learning and innovation. Processes: processes are implemented that promote interaction beyond departments and borders. Tools and techniques: methods that help both individual and team learning, such as promoting creativity and problem-solving techniques Skills and motivation: to learn and adapt.
Strategic Alliances
Strategic alliances are formal coalitions between two or more organizations in order to carry out companies in the short term, originated in opportunistic or permanent relationships that develop as a form of partnership between the participants.
The association with other companies, to save money, complement skills, attract new clients. Like any other relationship it works until the objectives of one or the other of the parties change.
Balanced Scorecard
The Balanced Scorecard concept was created by Drs. Robert S. Kaplan and David P. Norton in 1992 and has been implemented in hundreds of corporations, organizations and government agencies around the world. Balanced Scorecard (BSC) is a strategic management system that analyzes the organization from different points of view. It is a framework that translates the companies' vision and strategies into operational measures. The Balanced ScoreCard links four major perspectives to obtain a comprehensive overview of the situation of companies:
- Financial Perspective Client Perspective Perspective of Internal Processes Perspective of Learning of the Org.
There are indicators to measure both the past and the future. The «balanced scorecard» is one of the most important management concepts currently, properly implemented, it has the potential to convert a classic business discipline that can move the company forward in perfect synchrony.
Why a Balanced Scorecard?
For companies that are seeking to motivate and direct the organization's activities to a defined set of goals, the balanced scorecard paradigm provides a useful framework to identify, articulate, measure, and monitor the behaviors that lead to success.
The Balanced Scorecard becomes a powerful system to effectively measure management results. It is a great achievement to be able to carry out this type of analysis so versatile by means of very simple and flexible software which highlights the main measures that must be taken into account to carry out this management study.
Outsourcing
The idea is to examine each activity to see if someone can do it better at less cost.
Outsourcing is a term that is being incorrectly applied to the contracting of services such as «Man Power» or turnkey projects. To understand the true meaning of Outsourcing, we will explain the most outstanding characteristics of this contract:
- A clear objective, the scope of which involves transferring to the third party the responsibility and commitment of the related area, for which the contracted Company must position itself within the Organization chart of the contracting Company. A limited time, estimated based on the activities and phases to be developed to achieve the objective; It is considered that an objective whose scope is estimated to be over 2 years should not be established. A clear, open and high-level communication channel between the parties. A simple mechanism for evaluating progress and performance, and an adjustment or accommodation policy. of activities and objectives. That there is transparency, trust, satisfaction and good faith between the parties, so that they can feel that they are partners proactively committed to a common goal based on a win-win business relationship.
Economic Added Value (EVA)
It is necessary to assign to the business units the cost of capital that they use, to determine if they add or destroy capital. EVA is the result obtained once all expenses have been covered and a minimum expected return has been satisfied by the shareholders.
360 ° feedback
Employees must be evaluated by their peers and subordinates in addition to their bosses. Proponents of this idea believe it offers managers new perspectives.
It is a process of analysis of competences from different perspectives (superiors, colleagues, subordinates, internal clients, etc.), which presents a more objective description of the behavior and development of the valued professional.
Application:
It can be used to support themes such as:
- Development and change of culture Development of competencies Implementation of vision and mission Implementation of organizational values Development of leadership Development of human resources to achieve excellence Performance management Definition of career and succession plans Establish bases for compensation programs
Integrated Systems
Consulting firms (especially German SAP) popularized programs capable of coordinating Production, purchasing, finance, payroll, invoicing, etc… and ensuring that everyone interacts and concentrates on work
Coaching
Managers with training in business coaching, by skillfully integrating their language skills with the emotional and body skills, greatly increase their COMMUNICATION SKILLS, which allows them, among many other things, the following:
- Be able to seductively communicate values, vision, mission, strategies and plans Make known in detail both the context as well as the pursued and the planned Make fully understand all that this entails, and even emotionally Share the satisfaction of achieving what is desired, in order to be able to passionately engage everyone and each one, in the successful and sustained achievement of the ambition, despite the difficulties and the eventual shortage of resources, with:
- A very high degree of compliance, which - achieved as desired - generates great confidence in -everyone and everyone- and makes them feel -with good reason and at all levels- as a team of very high reliability.
