Updated June 15, 2023
Introduction to Management Theories
Managerial skills, Technology knowledge, and similar expertise are necessary to succeed in the workplace. Possessing a management skill is imperative to be part of the manager profile. The management theories assist in increasing the service quality and organizational productivity.
All managers do not use the single concept or theory while implementing strategies in the office. A combination of a number of concepts depending on the workforce, purpose and workplace are used by the managers. The popular management theories used at the work are chaos theory, contingency theory, and system theory. Theory X and Y that addresses management strategies for motivating the employees is also implemented to increase the productivity of the worker.
Understanding the management theories is the only way to find out which theory is suitable and beneficial in accordance to the circumstance at your workplace. Find out whether a single theory in itself is enough to handle the situation or combination of theories would help well. However, this could be done only if you studied and are aware of the management theories completely.
Important Management theories
There are several management theories for the purpose of the managerial activity at the office. However the most commonly used theories to manage the work and the functioning by the managers are as follows:
- Contingency Theory
This theory emphasizes that the decisions made by the manager are based on the present circumstances rather than following the method one size fits all. An appropriate action is taken by the manager depending on the features significant to the present situation. A leader in the army would want to utilize an autocratic approach while the manager in the university would want to use a leadership approach that embraces participation from employees.
- Systems Theory
Managers with a good understanding of systems theory identify how an employee affects the system around them and how different systems influence a worker. A system comprises of variants of parts that function together to achieve the objective. The theory of system is a broad viewpoint that enables managers to observe the events and patterns in the office space. Which in turn helps the managers to match up programs to perform as a combined whole for the complete mission or goal of the business rather than the isolated departments.
- Chaos Theory
Change is Necessary and perpetual. Specific situations and events in the company can be effectively controlled while some cannot. With respect to the chaos theory, it is identified that change is unavoidable and is rarely controlled. As the company advances, intricacy and possibility for susceptible events increase. Companies increase energy to maintain the complexity of new level. As the companies spend more energy, more structure is required for maintaining the stability. The organization continues to develop and change.
- Theory X and Theory Y
The management theory an individual choose to apply is strongly subjective to the beliefs about the attitudes of the employee. Managers who believe Employees lack ambition naturally and need incentives to upsurge the productivity lean towards the style of X management theory. While believes of Theory Y is that the employees are naturally determined and take responsibility. The managers who tend to follow the Theory X values often use a controlling style of leadership, Theory Y leaders inspire participation from the employees.
Management theory in the workplace for Motivation
Amongst several business theories that are in existence in the corporate governance, one motivational theory that can be applied by the management in most of the circumstances is the Equity Theory on job inspiration, which deals that conditions and pay are not adequate to motivate the staff.
Nothing like the basic motivation that involves of offering a reward such as pay for the action. The Equity Theory looks further than just the individual and comprises of factors in the individual’s setting that may have impacted motivation through comparison. The theory indicates clearly that when an individual compares himself to his colleague and discovers a fair result, he will be more motivated. While on the other hand he compares and finds the result to be unfair or unequal in comparison to his colleague he will tend to be less motivated. The principle of Equity Theory lies in the sense of motivation through seeming fairness.
How the Equity Theory Works?
When one individual compares his or her ratio of input and output to the ratios of input and output of the workers around them, the individual is supporting the Theory of Equity. The comparison of input and output ratios turns to be a point of reference for the motivation of the person and whether that motivation will decrease or continue. Hence, the Equity theory operates in two ways. The first involves the person assessing the ratio of input and output. The second comprises of the person assessing the ratios of inputs and outputs of the coworkers. Commitment, loyalty, and skill are part of the Input while praise, financial reward and increase in the responsibility are part of the output.
Importance of Equity theory
The Equity theory is an imperative business tool to evaluate the satisfaction of the employee, the relationship between productivity and motivation and how to increase motivation to reach and enhance the objectives and goals of the company. For Example, a hardworking worker might believe that a fair salary is paid to him until he comes to known the fact that he is one of the lowest paid employees in the staff. This knowledge might lead him to become uninspired which in turn could be a threat to the company’s success.
Basic Management Theories
There are basic management theories and models that are associated with leadership and motivation that can be applied to overcome the problems and practical situation.
The section covers:
- Human Relations Theory
- Classical Management theory
- System Theory
- Neo-Human Relations Theory
Human Relation Theories
The theory of human relation are reasonably concerned with human factors. The Human relation theory focuses on inspiration, leadership, and group motivation. At the focal point of the efforts are assumptions about the relationship between the manager and the worker.
- The emphasis was on the behavior of the human within the organization.
- It is stated that people require decisive factors in achieving effectiveness in the organization.
- As per the theory, the employees are descriptive and endeavored to be predictive of behavior in the company.
- A motive is a driving force or a need within a person. The procedure of motivation includes selecting between alternative forms of action to achieve the desired goals or end.
Classical Management Theory
Management occurs within a structured administrative setting with recommended roles. It is directed towards achieving the objectives and goals by influencing the efforts of others.
The Classical Management Theory
- Marks on structure
- Strict about what is upright for the firm.
- Manage practically
Henry Fayol was the first person to define the management that is namely familiar in the present as to command, to organize, forecast and plan, to control and to coordinate. The basic concepts and terminology were also given by Fayol that elaborated by the future researchers as a scalar chain, a division of labor, centralization and unity of command.
Key terms of Classical management theory
- Division of work: Develops practice and familiarity among the staff. Plus it reduces the effort or attention for one person or one group.
- Discipline: A noticeable mark of respect for the informal or formal agreements between the employees and the firm.
- Unity of Command: One man superior
- Initiative: In the limits of discipline and authority all levels of staff should be motivated to show initiative.
- Unity of direction: One superior with one plan for a group of tasks that has similar objectives.
- Order: A right person at the right place. Working carried out in an appropriate order.
The attention on the organization began to focus on systems with a number of interrelated sub-systems. The system method made an effort to synthesize with the classical approaches and later with human relations approaches that focus on the social and psychological aspects that highlight the needs of a human at people without organization.
The theory of systems is focused on the interdependence and complexity of relationships. The System is formed by regular interdependent or interacting groups of activities or parts that form the emergent whole.
System dynamics which is part of the systems theory is a technique of understanding the active behavior of complex systems. The basis of the method is the acknowledgment of the structure of the system- the interlocking, many circular, occasional time-delayed relationships among its components is imperative in determining the behavior of individual components themselves.
The aim of the system theorists was to find the general systems theory that can explain all systems part of the science field. The term goes back to the General Systems Theory. Many sociologists worked for a general systems theory. In the present, no systems theory can live up to the claim that there are general principles in the systems which are present in all systems. For example, every system is a collaboration of elements establishing as a whole.
The theory of Systems took more of a complete view of the company focusing on the organization’s entire work and the inter-relationships between human and structural behaviors producing a wide range of variables within the company. It helps us to understand the interactions between the organizations, groups, individuals, large social systems, communities and their environments. It aids us to enhance the understanding of how human behavior functions in a situation.
A system is a whole as well as a part at the same time. For example: A range of discipline along with professional from the various sector with authority is also required.
Key terms of System Theory
- Boundary: An imaginary line focusing around the system. It regulates the energy ie: resources, information into and out of the system.
- Subsystem: A part of the focal system. Eg: In a family it could be a parent or the children. It is referred as a parental subsystem or sibling subsystem.
- Focal System: The system on which the focus is upon at any given time. E.g.: the main manufacturing plant.
- Open system: Open system have a relatively freer exchange of information and resources within the system. It also enables relatively free passage of energy from and to the outside of the system.
- Suprasystem: It is an external part of the focal system, it is part of the environment of the focal system.
- Closed system: This system are more self-contained and isolated from their surroundings.
Neo Human Relation Theory
The group were social psychologists develop more complex theories:
Maslow is quoted as a seminal theory- the needs of the human beings. While McGregor and Herzberg neo-human relations theories focus on leadership and motivation but the theories are very dissimilar.
A particular focus on human motivation include:
Maslow: Proposed a hierarchy of human needs built with basic needs at the base and higher needs at the top.
An assumption is made in the theory that needs at each level needs to be satisfied before elevating the needs to the next higher level.
In the present, the focus is on the elements towards the top of the hierarchy of Maslow in which the work environment and work or the satisfaction are the typical features. Remarkably the attainment of confidence at the top of hierarchy.
According to the theory, Managers should consider the aspirations and needs of individual subordinates.
Likert: Theory describing new patterns of management based on the managers’ behavior.
McGregor: The Theory X and Theory Y through which the managers were perceived. The theory is quoted to make two remarkable set of assumptions about the employees.
Argyris: The needs of the company and people are studied under this theory. The workforce becomes cooperative instead of aggressive or defensive only if the needs of the employees are understood and are integrated with the needs of the organization.
Applying the management theories will not only bring success to the company but will maintain the bond with the employees associated with the organization. Hence, Study and know the management theories to imply it sensibly.
Here are some articles that will help you to get more detail about the management theories at workplace so just go through the link.