Management Theory and Practice in Australian Firms - Coursework Example

Management Theory and Practice in Australian Firms Name: Subject: Professor: Institutional Affiliation: Introduction The statement that “modern organizations that avoid the outdated principles of scientific management will always perform well” holds some truth to a large extent. To begin with, the principles of scientific management have been criticized for having several limitations. Secondly, while most contemporary theories evolved from scientific management, contemporary theories have built upon the scientific principles and included human relations and social factors that the scientific approaches did not envision or include. It is safe to argue that most organizations today use a combination of the scientific principles to a certain extent, and modern management theories. This paper seeks to evaluate whether scientific management principles are relevant or they have become obsolete in light of the principles of modern management theories in today’s organizations. The analysis will give particular attention to Australian organizations and the management practices that are applied. Scientific Management The most prominent classical organization theory is Taylor’s scientific management approach. According to Onday (2016, pp.115), scientific management was offered as a means for firms to grow profits, eliminate unions, raise the virtue and thrift of the working class, and increase productivity so that the larger society could advance to a new age of harmony founded on increased consumption of mass-produced goods by the working classes. The theory gained credibility for the idea that organizational operations could not only be planned, but also controlled in a systematic manner by experts by employing scientific principles (Onday, 2016, pp.115; Kwok, 2014, pp.32). Under the scientific management system developed by Taylor, factories are managed using scientific methods instead of the empirical “rule of thumb” that was widely prevalent during the late 19th century when Taylor developed his system (Schermerhorn, 2010, pp.123). According to Schermerhorn (2010, pp.123-125), the key components of scientific management are time studies, specialized or functional supervision, standardization of implements, tools and work methods, independent planning function, the principle of management by exception, utilization of slide-rules and related time-saving devices, the use of instruction cards for employee task allocation and huge bonuses for successful performance, the application of the differential rate, mnemonic systems for product and implement classification, use of a routing system, and the use of a modern system for costing etc. these elements were considered an extension of four main principles of management. The first one if the development of a real science. Secondly, the selection of workmen using scientific methods. Third, the scientific education and development of employees. Lastly, friendly and intimate cooperation between management and the workmen (Kwok, 2014, pp.32-33; Cole, 2004, pp. 104;). Criticisms of Taylor’s Scientific Management The principles of scientific management that were developed by Taylor have been criticized widely due to certain limitations of the theory. According to Armstrong & Taylor (2014, pp.124), Taylor’s task allocation concept was an approach intended to dehumanize workers since allocated tasks were not only to be performed in a specific way, but also an precise time was allocated for the task. This approach left no window for workers to think or excel. Furthermore, it put unnecessary pressure on workers to perform duties faster as they based the importance of work on productivity and profitability, hence exploiting employees and resulting in greater mistrust between employees and management (Armstrong & Taylor, 2014, pp.124). According to Armstrong & Taylor (2014, pp.124-125), Taylor’s approach imposed functional foremanship where each worker had eight bosses to report to. This form of approach violated the principle of unity of command that is exercised in the contemporary approaches to management where an employee reports to one boss. The contemporary approach had been found to make workers feel respected. Additionally, the contemporary approach gives employees a sense of belonging in an organization, unlike the scientific approach that made employees feel as though they were working in slavery (Armstrong & Taylor (2014, pp.124-125). Another criticism against Taylor’s scientific management approach is that it was a mechanical approach that only gave efficiency much importance rather than considering the human element in the labour force. He considered workers to be machines that could speed up work at all cost. In the contemporary approach, this kind of influence on employees is not experienced. Furthermore, information sharing among employees of diverse ranks, and encouragement of workers through rewards and other incentives as elaborated in behavioural science has been found to be more productive and important than Taylor’s scientific approach (Armstrong & Taylor (2014, pp.124-125). Cole (2004, pp.106) has stated that the scientific approach is an individual approach. This means that it gave much attention to individual performance rather that group performance. Under the scientific approach, only individual effort was measured in terms of what amount of task within the shortest time. In contemporary approaches, teamwork is a key aspect of success and development in both individual and organization growth. Furthermore, contemporary management theories rationalized the behavioural science problems noted in Taylor’s approach, which assumed that employees were only motivated financially. Modern approaches eliminate this assumption by giving employees flexible working terms, informality between managers and workers, high in-house engagement and collaboration, employee creativity and reflection. The scientific approach foregoes the ideological concept that employees are not only motivated by financial incentives but also by personal egos and social needs (Cole, 2004, pp.106-107; Bell & Martin, 2014, pp.108). Taylor’s scientific approach had a narrow application. The approach can only be applicable in manufacturing factories where employee performance is measured quantitatively. However, it cannot be applicable in the service sector where employee performance is measured qualitatively. Therefore, its applicability in today’s dynamic working environment is highly questionable as compared to modern approaches which take into account the measurability issue (Cole, 2004, pp.107). In reference to Cole (2004, pp.108), scientific management is applicable to simple organization rather than today’s complex and dynamic organizations. It does not focus on group performance but individual effort. Moreover, it divides employees into efficient and inefficient sets. It restricts creativity and innovation while promoting monotony through specialized repetition of work. Under the scientific approach, human factors are not taken into consideration since workers are motivated to work for monetary gains as opposed to development of human resources (Cole, 2004, pp.108). Taylor argued that managers and supervisors need to have tight control over employees. Taylor believed that workers followed their own personal interest and also possess natural desire to avoid work. Therefore, managers should control them and make sure that they follow instructions, rules, and regulations depending on level of authority (Bell & Martin, 2014, pp. 108-109). This approach is not supported in modern management practice since it is inhuman, dictatorial, and an infringement on employees’ rights. Contemporary approaches view people as important assets in the organization rather than production tools (Carpenter, Bauer & Erdogan, 2010, pp.134). Scientific Management Refined by Behavioural Sciences and Systems Approach Given the limitations and criticisms of Taylor’s scientific approaches, behavioural science theories seem to offer a true picture of today’s organizations. According to Uddin & Hossain (2015, pp.581), Douglas McGregor suggested Theory X and Theory Y based on two assumptions. Theory X defined employees to perform well when given instructions. On the other hand, Theory Y defined employees as very cooperative. Uddin & Hossain (2015, pp.581) further noted that for example, Henry Ford, an ardent disciple of scientific management- intended to introduce flexibility in the working conditions but failed to address the psychology of the employee i.e. the foreman relationship. A look at modern day electronics industry will reveal that managers at Hewlett-Packard subscribe to Theory Y in their management practices. According to Carpenter et al (2010, pp.156), Theory Y is a method and a people-focused approach to acknowledge individual contributions with respect and recognition. Uddin & Hossain (2015, pp.581) have further noted that at Hewlett-Packard, job security and long-term employment ensure low stress and motivates engineers to be more creative and innovative with transparent and informal “communication between employees and their work progress”. Similarly, Steve Jobs was a controlled disciple of scientific management in his early days, where although he had a good strategy, the company often experienced conflicts intense competition, and mistrust among Apple’s functional team members. Nevertheless, he later modified his management skills and development strategy and focused on delegating authority to teams with specific goals and timelines (Uddin & Hossain, 2015, pp.581). Behavioural management theories raised the need to include hygiene, economic conditions, wages, and living standards under scientific management. The aim here was to minimize mental pressure, monotony, stress and fatigue to enable the worker enjoy his/her work and perform work as a normal function rather than a simplified unintelligent series of motions and endless repeated movements. Furthermore, the Hawthorne Studies conducted by Elton Mayo introduced the influence of social factors or human relations on employee motivation. On the contrary, Taylor perceived some problems as purely the result of poor management and ones that could only be resolved by scientific management (Uddin & Hossain, 2015, pp.582). It is worthwhile to acknowledge the fact that management theories that sought to introduce the human, social and behavioural factors to scientific management seem to be more applicable in today’s organizations. According to Carpenter et al (2010, pp.160), systems approach can be used to define modern management. An organization is viewed as a system which is composed of interconnected subsystems that are dependent of each other. A system is perceived to be composed of components which are employees, physical environment, behaviour that emerge from the organization role demands and employee roles (Carpenter, 2010, pp.160). In modern management, all components are valued equally and operate interdependently to accomplish efficiency and high productivity. This approach is more applicable than the scientific approach since it encompasses the human behaviour and acknowledges it as an important aspect in the organization. The Case of Australian Firms and Management Practices It is safe to suggest that Australian companies adopt a combination of scientific, behavioural, and systems approaches to management. However, it is worthwhile to note that Australian companies only adopt scientific approaches to a limited extent and where applicable. In one comparative study of the management practices in Australian, Indian, Chinese and South African firms, it was established that Australian managers are less reliant on hierarchy that their Indian and South African counterparts. Australian managers are also less egalitarian than their Chinese and Indian colleagues, but provide information and communicate more openly. They are also less confrontational that their South African and Chinese counterparts (Jones & Jackson, 2001, pp.9-14). This may suggest that Australian firms and management practices are more in line with the behavioural approaches to management which advocate for more openness and information sharing between managers and employees. When it comes to motivators, Australian managers are significantly less motivated by independence, control and economic security than their Chinese counterparts. In terms of the direction of management commitment, Australian managers were found to be less dedicated to business objectives irrespective of organization, means, work, and results when compared to their Chinese counterparts. Australian firms are less control oriented and seem to be more people oriented when compared to Chinese firms (Jones & Jackson, 2001, pp.9-14). The fact that Australian organizations are less control oriented and have a significantly high humanistic orientation may be evidence that Australian firms are more inclined to behavioural and system approaches to management. Taking into account the scientific management principles, it is safe to suggest that they significantly contributed to modern management approaches. Rather than the rule-of-thumb criteria which is the first principle, defining how work can be done better and splitting the work into components can be considered as job/performance analysis, work design and work study in today’s management practices. The principle that describes selection of workers using scientific techniques, training and developing them is an essential function of modern management practices. Intimate collaboration between employees and management which is the third principle does not appear to be a feature of modern conditions in management practice. The last principle which denotes equal responsibility between management and employees in labour division can be defined as the division of planning as well as implementation in modern management practices (Turan, 2015, pp.1103-1104). Conclusions Modern management approaches streamlined the behavioural limitation faced by the scientific management approach by informality between manager-worker relationship, flexibility, high engagement and collaboration, employee creativity and reflection. On the other hand Taylor’s scientific management principles were intended to boost industrial efficiency and the methods were applied to the human factor. However, behavioural approaches argued for democratisation of industry where employees ought to be given appropriate recognition for their efforts at work. These statements are illustrative of the fact that the modern management approaches have incorporated the highly essential variable, behavioural science which scientific management completely omitted in earlier theory. References Armstrong, M. & Taylor, S., 2014. Armstrong's Handbook of Human Resource Management practice. Kogan Page Publishers. Bell, R.L. and Martin, J.S., 2012. 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Evolution of Modern Management through Taylorism: An Adjustment of Scientific Management Comprising Behavioral Science. Procedia Computer Science, 62, pp.578-584.Accessed from http://www.sciencedirect.com/science/article/pii/S1877050915026721 Read More