Principles of Management

Topic 1
AN INTRODUCTION TO
MANAGEMENT CONCEPTS
AND THEORIES 1

Lecturer: MSc. Giang Nguyen

LEARNING OUTCOMES

▰To understand the concepts of management & principles of

management

▰Be able to identify levels of managers and managerial skills

▰To understand the evolution of management theory, core concepts

and major theorists

1
 Learning Programme
Topic Session topic Indicative reading (core text)

1 Topic 1. An introduction to management concepts and theories Ch1 & 2

2 Topic 2. Organization and environment Ch3, Ch4 & Ch8
3 Topic 3. Planning Ch5 & Ch6
4 Topic 4. Decision making Ch7
5 Topic 5. Organizational Structure and design Ch8
6 Topic 6. Human Resource Management Ch9
7 Topic 7. Organizational change and innovation Ch10

8 Topic 8: Managing Individual Differences & Behavior Ch11

9 Topic 9. Motivating employees Ch12

10 Topic 10. Managing conflicts Ch13
11 Topic 11. Power, Influence and Leadership Ch14
12 Topic 12. Organizational communication Ch15
13 Topic 13. Controlling Ch16 3
Core text: Kinicki, Angelo & Williams, Brian K. (2013). Management, a practical introduction. (6th Ed.). McGraw-Hill

CONTENTS

PART 1
Introduction to
management

PART 2
The evolution of
management thought

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PART 1.
INTRODUCTION TO
MANAGEMENT
Management – What is it?
5

1.1. MANAGEMENT – WHAT IS IT?

“The pursuit of organizational goals efficiently and effectively by

integrating the work of people through planning, organizing, leading
and controlling the organization’s resources”

(Kinicki & Williams, 2013)

3
1.1. MANAGEMENT – WHAT IS IT?

“Management involves coordinating and overseeing the work

activities of others so that their activities are completed efficiently and
effectively”

(Robbins & Coulter, 2013)

1.1. MANAGEMENT – WHAT IS IT?

▰ Management is an essential activity arising when there is a collective

effort to accomplish a common goal.

▰ Management is a process of accomplishing work through

individual interaction.

▰ Management is planning, organizing, leading and controlling the

work or human efforts to achieve goals.

4
Management Functions

Management Functions

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5
 Question

Laura runs a sales and expense report at the end of each work day?
Which management function is she performing?
A. Leading
B. Organizing
C. Controlling
D. Planning

Question

“A manager sets the objective for the company: To

become a worldwide leader in retailing”. Which
management function is he/she performing?

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6
 Question

A manager motivates employees. Which

management function is he/she performing?

13

Question

A manager is assigning work for

employees. A manager motivates
employees. Which management function is
he/she performing?

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7
 Question

A marketing manager creates

steps to increase product sales.
Which management function is
he/she performing?

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EFFICIENCY AND EFFECTIVENESS

Efficiency Effectiveness
• The means • The ends
• To use resources – • To achieve results, to
people, money, raw make the right
materials, and the like decisions and to
– wisely and cost – successfully carry them
effectively out so that they achieve
•Doing things right the organization’s goal
• Doing right things

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EFFICIENCY AND EFFECTIVENESS

Effectiveness: You can achieve the goal

Efficiency: You can achieve the goal with

lowest resource

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EFFICIENCY AND EFFECTIVENESS

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9
 Question
Burger King decided to add breakfast to its hours of operation in
order to increase its customers. This was an attempt to improve the
organization's:
A. Effectiveness
B. Planning
C. Leading strategy
D. Efficiency

Example 1 – Efficiency versus

Effectiveness
✦ Many companies now use a recorded “telephone menu” of options to
answer customer calls
✦ This is efficient for the companies, but not effective
✦ Most consumers prefer a live agent

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 Example 2

Issue: Organizing a business meeting when working with a 22

foreign enterprise

Solution 1: A face-to-face business

meeting

▰Requires frequent travelling

▰Costs Go High

▰Unfeasible for long time

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11
Solution 2: An online meeting

▰Can connect to multiple people at same

time

▰Save money

▰Less stressful to employees

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Any other examples of effectiveness and efficiency?

In our life? In business context?

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Effectiveness and Efficiency in
Management

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Exercise: Filling in the blank

▰ ……… is coordinating and overseeing the work activities of others so

that their activities are completed efficiently and effectively.
▰ ……… is doing things right, or getting the most output from the least
amount of inputs
▰ ……… is doing the right things, or completing activities so that
organizational goals are attained.
▰ ………. is management function that involves setting goals,
establishing strategies for achieving those goals, and developing plans
to integrate and coordinate activities

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13
 Exercise: Filling in the blank

▰ ……… is a function that involves arranging and structuring work to

accomplish the organization’s goals
▰ ……… is management function that involves working with and
through people to accomplish organizational goals
▰ ……… is management function that involves monitoring, comparing,
and correcting work performance

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Rewards of Studying
Management
✦ Understanding how to deal with organizations from the outside
✦ Understanding how to relate to your supervisors
✦ Understanding how to interact with co-workers
✦ Understanding how to manage yourself in the workplace

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 Rewards of Practicing
Management
✦ You and your employees can experience a sense of accomplishment
✦ You can stretch your abilities and magnify your range
✦ You can build a catalog of successful products or services

1.2. MANAGERS – WHO ARE THEY?

“Someone who uses resources in an efficient and effective way so that the
end product is worth more than the initial input”

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 1.2. MANAGERS – WHO ARE THEY?

ØSomeone who coordinates and oversees the work of other people so

that organizational goals can be accomplished.

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1.2. MANAGERS- WHO ARE THEY?

managerial
roles empowerment
the process of
enabling/
authorizing an
individual to think,
behave, take action,
& control work and
decision making in
autonomous ways

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LEVELS AND AREAS OF MANAGEMENT

CEO, COO, President, Senior vice president

➢Also called senior managers, directors, chief officers
➢Make long-term decisions
➢Overall direction, objectives, policies and strategies

➢Also called division head, plant managers...

➢Largely responsible for liaison and co-ordination

➢Also called junior or first level managers

➢Narrow range of responsibility, clear objectives
➢Make sure operatives achieve targets

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RESPONSIBILITY/ AREAS OF
MANAGEMENT

• Functional Managers
➢Responsible for unit or department that achieves single functional objective
➢Staff have similar abilities and training
• General Managers
➢Usually higher position than Functional Managers
➢Can include some project managers who have wide responsibilities
➢Responsible for whole plant or unit confiding of several functions

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17
 Question

Which of the following is not one of the four management

functions?
A) planning
B) controlling
C) leading
D) implementing

Question
Donielle supervises the food assembly line workers. What type of
manager is she?
A.Top manager
B.Middle manager
C.First-line manager
D.General manager

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 Functional Departments

Functional Functional Roles

Department
Prepares account such as profit and loss accounts and balance
sheets and manages the money of the business
Manufactures goods in order to meet quality standards, targets
and deadlines
Conducts research to meet the needs of customers and arranges
promotional activities to sell the firm’s products
Handles recruitment, training and the general welfare of the
workforce

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1.3. MANAGERIAL SKILLS

Conceptual
Human skills Technical skills
skills

ü the ability to analyze ü the ability to ü the job-specific

and diagnose a understand, alter, lead, knowledge required to
situation and find the and control people’s perform a task
cause and effect behavior ü Common examples
include marketing,
accounting, and
manufacturing
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COMPOSITION OF SKILLS

differs by Management Level –

Robert Katz (mid 1970s)
As a manager moves from
first-line to top
management, conceptual
skills become more
important than technical, but
human remain important

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1.4. ROLES OF MANAGERS

✦ Interpersonal roles
managers interact with people inside and outside their work units
✦ Informational roles
managers receive and communicate information
✦ Decisional roles
managers use information to make decisions to solve problems or
take advantage of opportunities

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1.4. ROLES OF MANAGERS

Interpersonal Information Decision

➢Entrepreneur
➢Figurehead ➢Monitor ➢Disturbance
handler
➢Leader ➢Disseminator
➢Resource
➢Liaison ➢Spokesperson allocator
➢Negotiator

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Question

Which of the following is not one of the three skills managers should
cultivate?

A) technical skills
B) entrepreneurial skills
C) conceptual skills
D) human skills

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 Question

Which of the following is an informational role?

A) entrepreneur
B) liaison
C) monitor
D) negotiator

Question

CEO, Gary Kelly sets the direction and strategy for Southwest
Airlines. What type of managerial role is he performing?
A.Interpersonal
B.Informational
C.Decisional
D.Conclusive

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 HOME EXERCISE

▰Find out about names of famous managers all over the world
▰ List out their tasks in management
▰Why are they successful in their management job?
▰Examine which levels of management they belong to.

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TERMS TO KNOW

¨ manager ¨ efficiency ¨ Controlling

¨ first-line managers ¨ effectiveness ¨ technical skills
¨ middle managers ¨ planning ¨ human skills
¨ top managers ¨ organizing ¨ conceptual skills
¨ management ¨ leading ¨ organization

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PART 2. THE
EVOLUTION OF
MANAGEMENT
THOUGHT
48

DISTRIBUTORS OF THEORIES

Try to put the theory next to these contributors’ names

▰Frederick Taylor
▰Gilbreths Frank and Lillian
▰Max Weber
▰Henri Fayol
▰Mary Parker Follet
▰Elton Mayo
▰Abraham Maslow
▰Douglas Mc Gregor

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PART 2. THE EVOLUTION OF
MANAGEMENT THOUGHT

▰Management began as an art but is evolving into a science

▰Two overarching perspectives about management:
▻ Historical perspective: classical, behavioral, quantitative
▻Contemporary: systems, contingency, quality - management

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PART 2. THE EVOLUTION OF

MANAGEMENT THOUGHT

▰ Modern management began in the late 19th century.

• Organizations were seeking ways to better satisfy customer needs.

• Machinery was changing the way goods were produced.
• Managers had to increase the efficiency of the worker-task mix.

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 2.1. HISTORICAL PERSPECTIVE

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WHY STUDY MANAGEMENT

THEORIES?
Understanding theoretical perspectives of management:
❖ helps us understand the present
❖ provides a guide to action
❖ provides a source of new ideas
❖ gives clues to the meaning of managers’ ideas
❖ gives clues to the meaning of outside events

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2.1.1. CLASSICAL VIEWPOINT

Scientific
2.1.1.1
management

Administrative 2.1.1.2
management

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2.1.1.1. SCIENTIFIC MANAGEMENT

▰Defined by Frederick Taylor, late 1800’s

▰Major contributors: Taylor and the Gilbreths (Frank and Lillian Gilbreth)

▰Scientific management emphasized the scientific of work methods

to improve the productivity of individual workers.

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F.W. Taylor and Scientific
Management
F.W. Taylor’s Contribution (1856 – 1915)
•Frederick Taylor, known as the father of Scientific Management,
published Principles of Scientific Management, in which he proposed
work methods designed to increase worker productivity
•Scientific management focuses on worker and machine
relationships
•Organizational productivity can be increased by increasing the efficiency
of production processes.
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F.W. Taylor and Scientific

Management

▰The main things Taylor noticed of inefficiency:

The lack of standard tools or techniques

No match between skill and job

No motivation from management

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F.W. Taylor and Scientific
Management

▰Taylor based his system on motion studies:

▻Broke down each worker’s job into basic physical motions
▻Trained workers to use the methods of their best-performing co-
workers
▰ Taylor suggested employers institute a differential rate system –
more efficient workers earned higher wages.

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F.W. Taylor and Scientific

Management
▰Scientific Management (Taylor) 4 Principles
❖ Frederick Taylor believed that managers could eliminate
underachievement, which he called soldiering, by
1. evaluating a task scientifically
2. matching worker ability with the task
3. providing training and incentives
4. using scientific principles to plan work methods and make it easier for
workers to do their jobs

2–59

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The Gilbreths and Scientific
Management
▰Frank and Lillian Gilbreth were a husband-and-wife team

▰They expanded on motion studies, studied work to eliminate inefficient

hand-and- body motions

▰Using movie cameras to film workers at work in order to isolate the

parts of a job.

▰Frank is best known for his bricklaying experiments

60

How today’s managers use scientific

management

▰ Analyze the basic work tasks that must be performed

▰ Use time-and-motion study to eliminate wasted motions

▰ Hire the best-qualified workers for a job

▰ Design incentive systems based on output

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 2.1.1.2. ADMINISTRATIVE
MANAGEMENT

▰Concerned with managing the total organization

▰Seeks to create an organization that leads to both efficiency and
effectiveness.
▰Contributors:

Henry Max
Fayol Weber

The first to identify the major functions of Developed the concept of bureaucracy
management (a well-defined hierarchy of authority,
(P – O- L- C framework) formal rules and procedures,
developed a set of 14 principles a clear division of labor, 62
careers based on merit)

Fayol’s 14 set of Principles of

Management

1. Division of Labor: allows for job specialization.

▻Fayol noted jobs can have too much specialization leading to poor
quality and worker dissatisfaction.
2. Authority and Responsibility
▻Fayol included both formal and informal authority resulting from special
expertise.
3. Unity of Command
▻Employees should have only one boss.

2–63

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Fayol’s 14 set of Principles of
Management (cont’d)

4. Line of Authority
▻A clear chain of command from top to bottom of the firm.
5. Centralization
▻The degree to which authority rests at the top of the organization.
6. Unity of Direction
▻Employee should receive orders and report to only one supervisor.

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Fayol’s 14 set of Principles of

Management (cont’d)

7. Equity
▻The provision of justice and the fair and impartial treatment of all
employees.
8. Order
▻The arrangement of employees where they will be of the most value to
the organization and to provide career opportunities.
9. Initiative
▻The fostering of creativity and innovation by encouraging employees to
act on their own.

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Fayol’s 14 set of Principles of
Management (cont’d)

10. Discipline
▻Obedient, applied, respectful employees are necessary for the
organization to function.
11. Remuneration of Personnel
▻An equitable uniform payment system that motivates contributes to
organizational success.
12. Stability of Tenure of Personnel
▻Long-term employment is important for the development of skills that
improve the organization’s performance.

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Fayol’s 14 set of Principles of

Management (cont’d)

13. Subordination of Individual Interest to the Common Interest

▻The interest of the organization takes precedence over that of the
individual employee.
14. Esprit de corps
▻Comradeship, shared enthusiasm foster devotion to the common
cause (organization).

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Weber’s Principles of Bureaucracy

A better-performing organization should have five positive bureaucratic

features:
1. A well-defined hierarchy of authority
2. Formal rules and procedures
3. A clear division of labor
4. Impersonality
5. Careers based on merit

68

How today’s managers use

Administrative theory

▰ The functional view of the manager’s job can be attributed to Fayol

▰ The concepts of: managerial authority, centralized decision making,
reporting to only one boss…

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The problem with the Classical view

▰The classical viewpoint is too mechanistic

▰It tends to view human as cogs within a machine, not taking into
account of human needs

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Why the Classical Viewpoint is

Important?
✦ Work activity was amenable to a rational approach
✦ Through the application of scientific methods, time and motion
studies, and job specialization it was possible to boost productivity

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 2.1.2. BEHAVIORAL VIEWPOINT

▻Emphasized the importance of understanding human behavior and

motivating employees toward achievement.
▻Developed over 3 phases:
1. Early behaviorism
2. The human relations movement
3. Behavioral science

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2.1.2.1. EARLY BEHAVIORISM

¨ Hugo Munsterberg & The First Application of Psychology to Industry

¨ Father of industrial psychology
¨ Munsterberg suggested that psychologists could contribute industry in three
ways:
1. Study jobs and determine which people are best suited to specific jobs
2. Identify the psychological conditions under which employees do their best
work
3. Devise management strategies to influence employees to follow
management interests
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2.1.2.1. EARLY BEHAVIORISM

¨ Mary Parker Follett & Power sharing among employees and

managers
❖ Follett believed that:
1. organizations should operate as communities with managers and
employees working cooperatively
2. organizations should resolve conflicts through integration where
managers and workers talked over differences
3. managers should be facilitators, and workers should control the work
process

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2.1.2.1. EARLY BEHAVIORISM

▰By Elton Mayo & The Hawthorne Studies

▰Studies of how characteristics of the work setting affected worker
fatigue and performance at the Hawthorne Works of the Western Electric
Company from 1924-1932.
▰Employees worked harder if they received added attention, thought
that managers cared about their welfare and that supervisors paid
special attention to them
▰Implication: human relations movement

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2.1.2.2. HUMAN RELATIONS MOVEMENT

▰ Pioneered by Maslow & McGregor

▰Sparked by the Hawthorne Studies

▰Proposed that better human relations could increase worker

productivity

▰Contributors: Abraham Maslow and Douglas McGregor

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Abraham Maslow’s
Hierarchy of Needs

Self-actualization

Esteem

Belongingness
l

Safety

Physiological
77
Based on needs satisfaction

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 Theory X versus Theory Y
by Douglas McGregor

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2.1.2.3. THE BEHAVIORAL SCIENCE

APPROACH

▰Behavioral science
▻Relies on scientific research for developing theories about human
behavior that can be used to provide practical tools for managers
▻The disciplines: psychology, sociology, anthropology, and
economics.

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How today’s managers use the
behavioral approach

▰ Design jobs to the way that they work with employee teams to the way
that they communicate
▰ Application in motivation, leadership, group behavior and develop-
ment

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2.1.3. QUANTITIATIVE VIEWPOINTS

▰Emphasize the application to management of quantitative

techniques, such as statistics and computer simulations

▰Two branches: management science and operations management

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2.1.3. QUANTITIATIVE VIEWPOINTS

2.1.3.1. Management science

¨ Focus on using mathematics to aid in problem solving and decision
making
2.1.3.2. Operations research
¨ Focuses on managing the production and delivery of an
organization’s products or services more effectively
¨ work scheduling, production planning, facilities location and design

82

How today’s managers use the

quantitative approach
▰ Make budgeting, scheduling, quality control, and similar decisions

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2.2. THE CONTEMPORARY
PERSPECTIVE

84

2.2.1. SYSTEMS VIEWPOINT

▰Regard the organization as a system of interrelated parts

▰The four parts of a system
▻Inputs
▻Outputs
▻Transformation processes
▻Feedback
▰An open system continually interacts with its environment.
▰A closed system has little interaction with its environment

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 The Four Parts of a System

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2.2.1. SYSTEMS VIEWPOINT

▰Open system ▰Closed system

▻ continually interacts with its ▻ has little interaction with its
environment environment

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2.2.2. CONTINGENCY VIEWPOINT

▰Assumes there is no one best way to manage.

• The environment impacts the organization and managers must be

flexible to react to environmental changes.

• The way the organization is designed, control systems selected,

depend on the environment.

▰Technological environments change rapidly, so must managers.

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2.2.3. QUALITY – MANAGEMENT

VIEWPOINT
2.2.3.1. Quality control
▰The strategy for minimizing errors by managing each stage of
production
2.2.3.2. Quality assurance
▰Focuses on the performance of workers, urging employees to strive for
“zero defects”
2.2.3.3. Total quality management (TQM)
▰A comprehensive approach – led by top management and supported
throught the organization – dedicated to continuous quality improvement,
training, and customer satisfaction
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 Total Quality Management
1. Make continuous improvement a priority
2. Get every employee involved
3. Listen to and learn from customers and employees
4. Use accurate standards to identify and eliminate problems

Question
Which viewpoint emphasized the scientific study of work methods to
improve the productivity of individual workers?
A.Scientific management
B.Administrative
management
C.Behavioral science
D.TQM

45
 Question
Which viewpoint emphasized the importance of understanding human
behavior and of motivating employees toward achievement?
A.Scientific management
B.Administrative
management
C.Behavioral
D.TQM

Question
Which viewpoint stresses the use of rational, science-based
techniques and mathematical models to improve decision making and
strategic planning?
A.Scientific management
B.Operations management
C.Production management
D.Management science

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 Question

Who argued that people are motivated by a hierarchy of human needs?

A) Fayol
B) Maslow
C) Gilbreth
D) Mayo

Question

Operations management is an example of

A) The classical view
B) Management science
C) The quantitative view
D) The human relations movement

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 Question

All of the following are part of a system except

A) inputs
B) feedback
C) outputs
D) contingency processes

96

True or False? Explain

1. Plant managers require good problem solving skills.

2. Requirements for decision-making skills and planning skills for
managers at different levels vary.
3. Today's business requires managers to have good skills and
professionalism.
4. Technical skills are the most important for a director.
5. Human skills are only important to senior managers.
6. Depending on the level of manager, the importance of each type of
managerial skills is also different.

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 True or False? Explain

7. Management skills cannot be taught but can only be acquired through

experience.
8. Plant managers require good conceptual skills and do not need
human skills.
9. Requirements on different managerial skills are the same at different
levels of management.
10. Management is achieving goals through others’ efforts.

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SUMMARY OF THEORIES

“
▰Scientific Management Theory
▻Job specialization and division of labor
▻Taylor (Scientific Management)
▻Gilbreths
▰Administrative Management Theory
▻Fayol (14 principles of management)
▻Weber (Theory of Bureaucracy)

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SUMMARY OF THEORIES (CONT’D)

“
▰Behavioral Management Theory
▻Munsterberg
▻Follett
▻Mayo (Hawthorne Studies)
▻Maslow and McGregor (Human Relations Movement)
▰Quantitative viewpoint
▰ System viewpoint
▰ Contingency viewpoint
▰ Quality management viewpoint

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