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Classical And Contemporary Theories Of Management

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Question:

Discuss about the Classical and Contemporary Theories of Management.

 

Answer:

Introduction

Management refers to the act of creating a corporate policy and controlling, organizing, planning, and coordinating the organization’s resources so as to accomplish its short and long-term objectives. For every organization to succeed, it needs to have a strong team of management to assume the supervisory roles. At the same time, it should have resources like employees who require being properly managed (Frederickson & Ghere 2013). This justifies why each organization applies appropriate management strategies and models that suit it. For a very long time, management theories have enabled the organizations to make important decisions. However, this has been subjected to changes in response to the dynamics of the society. This paper presets an analysis of the changes in the application of managerial theories. It discusses the use of classical and contemporary theories of management in the modern society.

Reasons for the Little Change

As much as it can be said that the 1960s CEO will hardly notice much changes in the modern day management, it is true that little change will be felt. This will be due to the application of the following new theories of management:

 

Contingency Theory

According to this theory, managers are free to make decisions based on the prevailing conditions. Meaning, a leader or manager is not always compelled to apply a specific strategy to address an issue. Instead the manager should be guided by the circumstances at hand. This theory advocates for the flexibility in decision making. A manager who makes decisions depending on the challenges faced is regarded as responsive dynamic. It is encouraged to consider the situation before making a conclusion since each circumstance is different has its own uniqueness (Pike 2013). So, if a leader becomes flexible, a leader can be able to come up with decisions aimed at enabling the organization to tackle all its challenges no matter how difficult they might be.

There are many reasons why this theory is applied by the modern day managers. First, the theory is flexible and can give managers an opportunity to scan the organization, know about the nature and magnitude of the problem before coming up with a reasonable solution. At the same time, the theory can make it quite easier for the managers to consult and use theory critical thoughts to make a decision that will be relied on to turn the course of the organization. This justifies why it has been accepted as part of the contemporary management system. All these were not done in the past because the challenges faced were different from today’s (Tweedie & Holley 2016). The changes in the organizations have to be reflected in management strategies that suit the current society.

Contingency is one of the contemporary theories that were not in use in the past. It can shock the CEO because he will realize that the modern day managers are more flexible than they used to be in the past. During the 1960s and before, managers could not just wait for situations to make their decisions. Instead, classical theories and models of management were always followed in the organization. Managers were therefore not expected to be so dynamic. No one would sit down and study the problem to make a decision in response to its uniqueness (Frederickson & Ghere 2013). Whenever there was a need to make some decisions, the managers would have to apply the rules, strategies and models that were accepted at the time. This is a change that the CEO will notice with ease because he never did the same during his time.

The CEO will learn that there are different kinds of contingencies upon which managerial decisions are made. These are technology, consumers, suppliers, government, competitors, trade unions, the public and other interest groups. So, by considering these varying contexts, the management gets to balance internal interest with that of the stakeholders who need to be catered for in any decision made. Contingency becomes a significant theory to be applied in meeting the goal because it can enable the management to acknowledge that there is no one best strategy to adopt to suit all the changing contexts (Shih, Young & Bucher 2013). If each of these situations is treated as it is, the management can always make its decisions without unnecessarily inconveniencing the system, a practice that was not popular in the 1960s.

Systems Theory

One of the theories that the 1960 CEO will get to learn about is the systems theory. According to this model of management, the organization should be perceived as a sophisticated system with inputs, outputs and processes. For optimal results, each of these elements should be properly coordinated. For a proper management, the inputs which basically include human resources, technologies, capital and raw materials should be treated as an important aspect of the organization. The input can be of great contribution if a good process is put in place (Getz & Page 2016). Meaning, there needs to be activities like planning, coordinating, organizing, staffing, controlling and motivating should be done as it ought to be. At the same time, the management needs to ensure that the output that entails quality production is guaranteed. This is the only way through which the clients’ diverse needs can be met.  

The application of this theory will be a shocker for the CEO because of the significance it puts on the organization as an entire system. In the past, managers did not need to treat the organization as such (Tweedie & Holley 2016). However, with the application of this theory, the management has to treat the organization as one whole system whose success depends on a proper manner in which the inputs, outputs, and processes are managed.  It is for this reason that the modern day managers are focused on the inputs, an activity done to satisfy the inputs.

Having recognized the significant contributions of the employees, the modern managers have resorted to motivation strategies to suit each of them. Meanwhile, to properly utilize resources, the managers make important decisions to plan, organize and coordinate all the activities so as to expend the available resources without any wastage. Furthermore, to complete the system, the management has to be concerned about its clientele (Miner 2015). As the buyers of the products, the clients’ needs must be satisfied at all times. Hence, the management makes important decisions to deliver quality produce, make it accessible to all the customers and make the necessary efforts to seek for their feedback whenever necessary. Actually, the systems theory has revolutionized management because it has introduced new practices that were not done in the 1960s. Therefore, by encountering this theory, the CEO will contend with the changes in the contemporary managerial system and get to experience what had never practiced during his time.

 

Why the CEO will Notice Little Change

When the CEO who served in the 1960s gets an opportunity to interact with the contemporary managers, he will notice many changes. This is due to the fact that there are new practices that have been introduced into the management of organizations. At the same time, the CEO will get to realize that certain practices have not changed since the modern managers have upheld certain aspects of classical management. Some of the classical theories still in use today are discussed herein:

Bureaucratic Theory of Management

When the CEO gets to interact with the current managers, he will realize that the concepts of organizational hierarchy, specialization, and strong lines of authority have not changed. This simply implies that the modern managers, just like their past counterparts, still apply the principles of the theory of bureaucracy.  As clearly outlined by Marx Weber, bureaucracy is one of the significant aspects of organization. In order to improve efficiency in production, the organization needs to be structured into hierarchies (Adler 2012). In the hierarchy, there should be different levels of management made up of top managers, middle managers, junior managers and the subordinates. Besides, the organization should be sub-divided into departments each of which having its own respective heads. At the same time, the organization should instill the spirit of specialization by encouraging each employee to concentrate in their respective areas of interest.

Upon a thorough analysis of the situation, the CEO will realize that these aspects of bureaucracy have not changed. Just like in the 1960s, modern day organizations are structured into hierarchies. At the very top of the structure is the Board of Directors, followed by the executive management, junior management and the support staff. Each of these areas is handled by specialists whose promotion is based on experience and qualification (Chen & Wang 2014). Meanwhile, the organization is segmented into different departments such as Human Resource Management, production, sales, marketing, and many others depending on the nature of the organization. For quality service delivery, each of these departments has a distinct boundary upon which they operate. All these still remain the same way they used to be done before the 1960s when the CEO was still active.

 

Motivation Theories of Management

There are different theories that have been applied in the management of employees. Some of the most prominent theories of motivation are Abraham Maslow’s Need Theory and Douglas McGregor’s theory X and Y. According to Abraham Maslow, human beings have needs that are arranged in a pyramid right from the most basic to the most luxurious. These include physiological, safety, belonging, esteem and self actualization. Everyone should satisfy these needs beginning with the most basic up to the most luxurious (Jerome 2013). On the other hand, theory X and Y states that human motivation is determined by incentives (motivators) and demotivators. These theories played a very significant role in the management of human resources. At all times, the managers had to properly apply these theories to boost the morale of the workers.

Indeed, the CEO realized that there are many aspects f employee management that have not changed up to the present times.  Just like in the past, contemporary manages acknowledge that employees are the most valuable assets for an organization. Without workers, no objective can be accomplished because it is through their efforts that the tasks are performed. It is for this reason that the management takes all the necessary measures to identify the employees’ needs and satisfy them appropriately (Kim, Lee, Chun & Benbasat 2014). Since these theories are still in use, the contemporary managers apply the principles of rewards, punishment, democracy, incentives, strict supervision. There is no organization that does not, in one way or the other, motivate its employees. Otherwise, it can experience a high rate of turnover that can negatively impact on its productivity and prosperity.

These aspects of motivation are still applicable n the modern society because they have a lot of benefits. First, the strategies are necessary for helping the employees to feel recognized, respected and appreciated because of the imminent contributions they make to the organization. In addition, motivation is good because it can enable the organization to enhance the productivity of employees and minimize the chances of turnover (Getz & Page 2016). This can, in the long run, enable the organization to meet its short and long-term goals. Such benefits have made motivation theories to remain in use right from the classical to the present times. It is why the CEO thought that nothing much has changed since he retired from his managerial position many decades ago.

 

Conclusion

The experiences of the CEO clearly prove that change is an inevitable reality in the society. The fact that the CEO noticed changes in the organization shows that management strategies and models have been changing over the years. This is why the CEO observed that modern organizations make decisions based on the context and systems, thanks to the application of the contingency and systems theories of management. Nevertheless, the practice of specialization, departmentalization, democratization of decision-making, and employee motivation shows that the classical motivation and bureaucracy theories are still applied in management. Thus, the CEO noticed little change.

 

References

Adler, P.S., 2012, Perspective—the sociological ambivalence of bureaucracy: from Weber via Gouldner to Marx. Organization Science, 23(1), pp.244-266.

Chen, R. & Wang, H.M., 2014, Research on organization structure and operation efficiency of extreme floods emergency management under “bureaucracy-cooperation” system: Taking Huaihe River Basin as a case. In 2014 International Conference on Management Science & Engineering 21th Annual Conference Proceedings (pp. 2095-2101). IEEE.

Frederickson, H.G. & Ghere, R.K., 2013, Ethics in public management, ME Sharpe: New York.

Getz, D. & Page, S.J., 2016, Event studies: Theory, research and policy for planned events, Routledge: London.

Jerome, N., 2013, Application of the Maslow’s hierarchy of need theory; impacts and implications on organizational culture, human resource and employee’s performance. International Journal of Business and Management Invention, 2(3), pp.39-45.

Kim, T.H., Lee, J.N., Chun, J.U. & Benbasat, I., 2014, Understanding the effect of knowledge management strategies on knowledge management performance: A contingency perspective. Information & management, 51(4), pp.398-416.

Miner, J.B., 2015, Organizational behavior 1: Essential theories of motivation and leadership, Routledge: London.

Pike, S.D., 2013, Destination Marketing and Management–Theories and Applications. Tourism Management, 34, pp.247-248.

Shih, M., Young, M.J. & Bucher, A., 2013, Working to reduce the effects of discrimination: Identity management strategies in organizations. American Psychologist, 68(3), p.145.

Tweedie, D. & Holley, S., 2016, The subversive craft worker: Challenging ‘disutility’theories of management control. Human Relations, p.0018726716628971.

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