Page 54 - DMGT402_MANAGEMENT_PRACTICES_AND_ORGANIZATIONAL_BEHAVIOUR

Unit 2: Development of Management Theories

Notes
evaluation reports still do the same. Also the data we are generating in Eskewed is enormous
but is not working for us”. Vijay himself was feeling that the system hasn’t worked for
them. He said slowly, “Lets stop the system for now. I think we need to have a second
opinion on the issue”.
Questions
1. Why is Vijay Kamath facing these problems and not getting the expected result?
2. Could the external consultants have made it more successful?
Source: Parag Diwan, Management Principles and Practices, Excel Books.

2.4 Summary

In this unit, an overview of various management theories was provided.
The key characteristics of classical organisation theory being: (a) Division of Labour (b)
Functional Process (c) Structure and (d) Span of Control.
The neo-classical approach was developed as a reaction to the classical principles, it did
not abandon the classical approach altogether, rather it pointed to the limitation of classical
approach.
The major facts discovered by these experiments include the important role of groups in
determining the attitude of workers; need for communication among ranks; increasing
satisfaction leads to effective organisation and that people in an organisation are motivating
higher level needs.
It also provided an overview of systems approach and the modern organisational theory.

2.5 Keywords

Bureaucracy: Highly specialized organisation structure

Classical Approach: It emphasises organisational efficiency to increase organisational success.
Hawthorne studies: A group of studies conducted at the Hawthorne plant of the Western Electric
company during the late 1920s and early 1930s whose results ultimately led to the human
relations view of management.
Human Relations Theory: A movement in management thinking and practise that emphasised
satisfaction of employees' basic needs as the key to increased worker productivity.

Scientific management: Scientific study of work to improve efficiency.
Systems theory: It tries to solve problems by diagnosing them within a framework of inputs,
transformation processes, outputs and feedback.

2.6 Self Assessment

Fill in the blanks:
1. As per the classical theory, organisations were……………….and humans the………………..
2. The classical theorists argued that the relationship between organisation and workers
could be establish through………………communication.
3. Classical thought of management was divided into two parts namely ………………… and
……………………

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