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Approaches To Management And Theories Of Organization

Paper Type: Free Essay Subject: Business
Wordcount: 2584 words Published: 1st Jan 2015

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The human resource approach very much applied the psychological aspect of human nature to manage organizations. organizations are composed of informal structures, rules. and norms as well form practices and procedures. the human relation approach represents a distinct break from the classical approach. A simply human relation pertains to motivating people on organizations in order to develop teamwork which effectively fulfils their needs and leads to archiving organizational goals.

ABX is want getting good archive for HR following this two theory. These two management theories are explain more details of this human resource approach.

Maslow’s Need Hierarchy Theory

Higher order hierarchy of needs Reward

Maslow’s hierarchy of needs assumes that people are motivated to satisfy five levels of needs:






The hierarchical arrangement suggests that the five levels of needs are arranged in order of increasing importance, starting with physiological needs. According to the theory, when needs at one level are satisfied, they are no longer motivators and the individual “moves up” the hierarchy to satisfy needs at the next level. Maslow’s view of motivation provides a logical framework for categorizing needs, but it does not supply a complete picture.

Maslow’s Need Hierarchy Theory Vs Reward

Maslow’s Hierarchy of needs in the perspective of employee motivation is to identify the satisfied needs and provide opportunities to meet the unmet needs to motivate the employees. The major weaknesses of the need theory; is the non-recognition of individual differences and ignoring other factors. For example the work itself can motivate employees.

Theory X and Theory Y

Theory X and Theory Y is about Human nature like the Maslow’s hierarchy of needs. The Theory X assumes, humans are in average dislike work and avoid responsibility and must be controlled and threatened to work hard. As well, it assumes people that they don’t like responsibility and desires security above all. They must be directed so that they work towards organizational goals.

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These assumptions are at play behind most organization, which pursues tight control, and punishment or they prefer harmony at work and ignore more higher order needs as specified by Maslow’s hierarchy of needs so that the employees behave as Theory X expected. Theory X must be used very carefully in modern organizational environment because it may be counterproductive and may reduce motivation of employees. Contrast to Theory X, Theory Y assumes people use mental and physical effort in work as natural as play.

As well, it assumes that people will direct themselves if they are committed to the goals of the organization. Under proper conditions, average person not only accepts responsibility, but also seeks responsibility. In addition, it assumes imagination, creativity; ingenuity can be used to solve work problems by a large number of employees.

Theory Y also assumes, that in modern industrial life intellectual potential of average man is partially utilized. In the context of employee motivation, if subordinates are not in agreement with the manager of the desired results then the only way for the manager is to use his authority to get the work done using the Theory X assumption. However, if the employees are emotionally mature, agrees with desired results, work is sufficiently responsible and flexible and the employee can see his position in the organizational hierarchy, then in these conditions participative approach to problem solving leads to much improved results applying the Theory Y. As well, in situations, where the employees agree and commit to the objectives of the organization, then explaining the matter fully to the employees the purpose of action and allow them to self-direct them, they may use better methods and do a better work than simply carrying out an order from the manager. Theory Y is more appropriate in this situation.

Systems Approach

The system mean organization input human energy ,material and information, after the operations in the organization they leave as goods or final products as output. this process call system. systems approach is vital since the interaction and interlinking of internal resources, capabilities and systems very much explain the dynamism and adaptive nature of organization towards its environment. system approach is have four major concepts.

Specialization: A system is divided into smaller components allowing more specialized concentration on each component.

Grouping: To avoid generating greater complexity with increasing specialization, it becomes necessary to group related disciplines or sub-disciplines.

Coordination: As the components and subcomponents of a system are grouped, it is necessary to coordinate the interactions among groups.

Emergent properties: Dividing a system into subsystems (groups of component parts within the system), requires recognizing and understanding the “emergent properties” of a system; that is, recognizing why the system as a whole is greater than the sum of its parts. For example, two forest stands may contain the same tree species, but the spatial arrangement and size structure of the individual trees will create different habitats for wildlife species. In this case, an emergent property of each stand is the wildlife habitat.

ABX is want move on this steps for archive her goals .input lot of raw material because getting good customer relationship and build the new developments in ICT education. They inputs are technology, money ,best knowledge HR. these inputs go throw to organization operations and get it her final output is value customers and getting good service market rang on srilanka.

Contingency Approach

The contingency approach to management is based on the idea that there is no one best way to manage and that to be effective, planning, organizing, leading, and controlling must be tailored to the particular circumstances faced by an organization.

The idea that the organizational structures and control systems manager choose depend on are contingent on characteristics of the external environment in which the organization operates. Assumes there is no one best way to manage. The environment impacts the firm and managers must be flexible to react to environmental changes. In rapidly changing organizational environments, managers must find ways to coordinate different departments to respond quickly and effectively.

2.2 Management theories

Management approaches and organizational theories deal with how an organization achieves its management objectives through the organizational structure, its design and other elements. The management theories can be classified as five major schools of management thought. They are,

Classical School of Management (Includes Scientific Management and Bureaucratic management) – here the emphasis was on managing workers and organizations more efficiently

Scientific management

Scientific management involves using scientific methods to determine the best way for a job to be done. By using scientific application as statistics, optimization models, information models for management activities might lead to continuous improvements and responsiveness to customers’ needs and expectations.

Taylor’s scientific management consist of four principles

Scientific job analysis

Through observation, data gathering, and careful measurement, management determines the “one best way “of performing each job.

Selection of personnel

Once the jobs analyzed, the next step is to scientifically select and then train, teach and develop workers

Management operation

Mangers should cooperate with workers .and ensure all the work done by the principals.

Functional Supervising

Mangers assume planning, organizing, and decision-making activities, whereas workers perform their jobs.


Certain rules and regulations which are used by the organizations to monitor its activities

Behavioral School of Management (Includes Human Relations) – here the emphasis was on understanding human behavior in the organization

The Hawthorne Studies

The Hawthorne studies consisted several experiments.

Quantitative School of Management – here the emphasis was on increasing quality of managerial decision-making through the application of mathematical and statistical methods

Administrative Management

Whereas scientific management focuses on the jobs of individual workers, administrative management concentrates on the management of an entire organization.

Systems School of Management – here the emphasis was on understanding the organization as a system that transforms inputs into outputs while in constant interaction with its’ environment

Contingency School of Management (Includes Contingency approaches) – here the emphasis was on applying management principles and processes as dictated by the unique characteristics of each situation

principle of management

Division of work

Authority with responsibilities


Unity of command

Unity of direction

Subordination of individual interests


Scalar chain



Personnel tenure


Spirit de corps

Classical School of Management

Even though scientific management was introduced many years before, organizations still use these principles or theories with minor adjustments. When scientific management is considered, Henry Fayol would be the significant character which would emerge. Today’s organizations follow what Henry Fayol introduced with minor adjustments. Bureaucracy means the usage of rules, regulations, policies, procedures and standardization of activities. This concept was introduced by Max Weber. This type of management would be used in the military and not in a bank usually. This could be understood through the way in which both banks operate.

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Behavioral School of Management

According to research which was carried out it has been possible to identify that human interaction or group relationships have a direct impact on productivity and would help to increase the motivation of employees. Therefore, the behavioral management school principles are more focused to understand individual employee’s behavior, their interaction and also motivational factors. When ABX has been considered it was possible to understand that the organization carries out many activities which would encourage employee communication.

Systems School of Management and Contingency School of Management

As it was mentioned before both the organizations, ABX follow flat organization structure. However, in the case of ABX centralization is less prominent as the institute believes that empowerment of employees would bring out the best from the employees. In a systems approach the organization as a whole would be considered as one system and hence in these type of systems integration, communication and independence plays a vital role. Whereas in contingency approach it is believed that there is no best way to arrange an organization and this has to be decided based on the nature of the organization.

Finally, it could be understood that even though organizations still follow scientific management they try to move more towards the usage of human relations approach and a contingency approach.

Functions of Management

There are mainly four functions of management. These functions are,


Determines the broad lines for carrying out operations, preparing methods by which they are carried out and setting standards of performance.

When planning is done the management of the organizations would need to gather information from the environment in which they operate. For this purpose the organizations would use the macroeconomic factors and would use the PEST tool. Virgin Rail group and British airways would both use the PEST tool so that they would be able to analyze the macroeconomic factors which would affect their organization. The constant changes in the environment should be regularly noted through the PEST tool and based on that the organizations should be able to respond. Further, planning would have the following aspects; forecasting, utilization and also action decision.

2) Controlling:

Checking actual performance against standards to ensure satisfactory progress and performance, and recording as a guide to possible future operations.

Control is a vital element for ABX as it is the only way by which the managers can find out if the organization is achieving the goals and objectives. Controlling can be carried out by standards, measurements and comparisons.

Further, organizational performance could be measured based on productivity measures, through financial rations which could be compared against benchmarked companies, by setting standards and having key performance indicators.

3) Co – ordination:

Balancing and marinating the team by ensuring a suitable division of work and seeing that tasks are performed in harmony.

4) Motivation:

Getting members of the teams to work effectively, to give loyalty to the group and to the task, to carry out their tasks properly, and to play an effective part in the activities of the organization.

It is understood that the main task of a manager is to get things done through employees. But in order to get employees to perform some task they would need motivation. ABX provides motivation for its employees through various methods ranging from provision of a safe and a healthy working environment to empowerment of employees, to provision of rewards and awards. This would help to uplift the employee morale and in turn motivate the employees to work for the organization.


The management style can be defined as informal without being casual, but ABX approach to business is totally serious. Branson has a particularly individual style of informal, risk taking, entrepreneurial management. He manages by empowerment and mega-parties for his staff. Within the business units, Branson adopted his own personal style of management, priding himself on actively involving employees and seeking their ideas on ways of further adding value to his customers

Importance of organization theory and the effects

It is an assembly of people working together to achieve common objectives through a division of labor. As Jeffrey Pfeffer summarized in New Directions for Organization Theory.

Organizational theory studies provide an interdisciplinary focus on

The effect of social organizations on the behavior and attitudes of individuals within them,

The effects of individual characteristics and action on organization,

The performance, success, and survival of organizations,


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