HHA 501 – Health Administration First Semester 1440/ 1441

King Saud UniversityCollege of Business AdministrationDepartment of Health Administration Masters` Program HHA 501 – Health Administration First Semester 1440/ 1441 Mohammed S. Alnaif, Ph D.alnaif@ksu.edu.sa Dr. Mohammed Alnaif

Management Learning Objectives • Define and explain management; • Describe how management has evolved as a field of knowledge, theory, and practice; • Explain major theories of management, • Explain how management theory is used to manage healthcare organizations Dr. Mohammed Alnaif

Management The Management Process Some regard management as getting things done through and with people. Others consider it the process of reaching organization goals by working with and through people. Always remember that management involves people – usually lots of them. Dr. Mohammed Alnaif

Management THE BIRTH OF MANAGEMENT IDEAS • Knowledge about management today is the result of a long and continuing innovative process. • Examples of management practices go back several thousand years, • The development of management as a field of knowledge is more recent. Dr. Mohammed Alnaif

Development of Major ManagementTheories Pre-classicalContribution ClassicalTheorists Behavioral Approach Quantitative Approach Modern Integrative Approaches Group Influences Scientific Management Management Science The Systems Theory Administrative Theorists Hawthorne Studies Operation Management Contingency Theories bureaucratic Model Maslow’s Needs Theory Management Information System Emerging Approaches Theory Z and Quality Management Theory X & Theory Y Model I versus Model II values 1800 1900 2000……….

Management THE BIRTH OF MANAGEMENT IDEAS • Much of the incentive for developing management theories and principles stemmed from the industrial revolution, which produced the growth of factories in the early 1800s. Pre-classicalContributors • A number of individuals in the pre-classical period of the middle and late 1800s offered ideas that laid the groundwork for subsequent, broader inquiries into the nature of management. Dr. Mohammed Alnaif

Management ROBERT OWEN (1771 - 1858) • Advocated concern for the working and living conditions of workers. • He recognized the need for and applied personnel practices, assumed responsibility for training workers. • His ideas laid the groundwork for the human relation movement. Dr. Mohammed Alnaif

Management CHARLES BABBAGE (1792 - 1871) • An Englishmathematician widely known as “the father of modern computing”, he built the first practical mechanical calculator and a prototype of modern computers. • He emphasized the scientific approach with the idea of work specialization, the degree to which work is divided into various jobs. • He recognized that not only physical work but mental work as well could be specialized. • Babbage also devised a profit sharing plan with workers. Dr. Mohammed Alnaif

Management HENRY R. TOWNE (1844 - 1924) • He called for the establishment of management as a science and the development of principles that could be applied across management situations. • In 1886 at the meeting of the American Society of Mechanical Engineers, Towne read his landmark paper titled “The Engineer as an Economist”. In it he called for the recognition of management works as a practical art similar to engineering. • The presentation was attended by Frederick Taylor known as the father of scientific management. Dr. Mohammed Alnaif

Management CLASSICAL VIEWPOINT • The classical viewpoint is a perspective on management that emphasizes finding ways to manage work and organizations more efficiently. • It is made up of three different approaches: • scientific management, • administrative management, and • bureaucratic management.. Dr. Mohammed Alnaif

Management Scientific Management • Scientific Management is a type of management that uses standardization, specialization, and scientific experiments to design jobs for greater efficiency and production. FREDERICK W. TAYLOR (1856 - 1915) • Taylor was very much interested in developing solutions to the problems of labor efficiency. • One of Taylor’s first jobs was as a foreman at the Midvale Steel Company in Philadelphia, where he developed a strong dislike for waste and inefficiency. Dr. Mohammed Alnaif

Management Scientific Management • At Midvale he observed what he called “soldiering”: working at less than a normal pace or deliberately working at less than capacity. • Taylorbelieved that workers engaged in soldiering for three main reasons. • First, they feel that increasing their productivity will cause them or other workers to lose their jobs. Dr. Mohammed Alnaif

Management Scientific Management • Second, faulty wage systems set up by management encouraged workers to operate at a slow pace. • Third, general methods of working and rules of thumb handed down from generation to generation were often very inefficient. Dr. Mohammed Alnaif

Management Scientific Management • Taylor believed that managers could resolve the soldiering problem by developing a science of management based on his four principles of scientific management the process starts with the • analysis of the work situation, • task analysis, • matching tasks with workers, and • continued management. Dr. Mohammed Alnaif

Management Scientific Management focused on: • Taylor focused on improving individual jobs. • The best way of doing each task/job by eliminating operations that resulted in wastage of men and materials. • Time and motion studies to find optimum time and nature of operations for successful completion of each task Dr. Mohammed Alnaif

Management Administrative Management • It is an approach that focuses on principles that can be used by managers to coordinate the internal activities of organizations. The focus is on the total organization. HENRI FAYOL (1841 - 1925) • A French industrialist, Fayol was unknown until his most significant work General and Industrial Management was translated into English in 1930. Dr. Mohammed Alnaif

Management Administrative Management HENRI FAYOL (1841 - 1925) • Drawing on over fifty years of his managerial experience, Fayolattempted to systematize the practice of management to provide guidance and direction to other managers. • Part of his thinking was expressed in fourteen principles of guidelines for effective management. Dr. Mohammed Alnaif

Management Administrative Management HENRI FAYOL (1841 - 1925) • Fayol work helped developed administrative principles that are still widely used today. • A typical organization chart reflects much of the administrative theory and Fayols’ principles (exhibit2.1) • Division of work is how work is separated into smaller more specialized tasks and activities. Dr. Mohammed Alnaif

Exhibit 2.1 A typical organization chart reflects much administrative theory

Management Administrative Management HENRI FAYOL (1841 - 1925) • Specializationrefers to the width of the range of tasks done by an employee or department. • Coordination is connecting individual tasks, activities, jobs, departments and people to work together toward a common purpose. • Authority power formally given to a job position to make decisions, take actions, and direct and expect obedience from subordinates. Dr. Mohammed Alnaif

Management Administrative Management HENRI FAYOL (1841 - 1925) • Line of authority the vertical chain of command, authority, and communication up and down an organization. • Line jobs that contribute directly to achieving an organization’s purpose and main goal. • Staff jobs that use specialized skills, abilities and expertise to support line jobs and thereby indirectly contribute to the organization’s goals. Dr. Mohammed Alnaif

Management Administrative Management HENRI FAYOL (1841 - 1925) • Unity of command means arrangement in which a worker takes commands from and is responsible to only one boss. • Span of control how many subordinate workers a manager is directly responsible for; how many workers report directly to that manager. • Centralization how high or low in an organization the authority exists to make decision. Dr. Mohammed Alnaif

Scientific management and administrative management differ from each other on the following grounds:

Management Bureaucratic Management is an approach that emphasizes the need for organizations to operate in a rational manner, rather than relying on the arbitrary whims of owners and managers. Max Weber (1864 - 1920). A German sociologist Major characteristics of Weber’s ideal bureaucracy include, specialization of labor, formal rules and procedures, impersonality, well defined hierarchy, and career advancement based on merit. Dr. Mohammed Alnaif

Management Bureaucratic Management Max Weber (1864 - 1920). The word bureaucracy may elicit negative or cynical feelings because bureaucratic rulessometimes create obstacles and delays. Weber thought work and organizations were based too much on personal connections, favoritism, family relationships and office policies. Dr. Mohammed Alnaif

Management Principles of Bureaucratic Theory • Special training or experiences are set for the position • Hierarchical command structure (clear line of command) in which each position reports and is accountable to a higher position • Appointments and promotions based on person’s qualifications for the job • Standard administrative procedures • Managers are shield from politics, owners of a company should not manage it or interfere . Dr. Mohammed Alnaif

Management Human Relations Theories Human relations management theories emphasize the importance of aligning the needs of the workers with the needs of the company and adopting policies aimed at their mutual benefit. Elton Mayo (1880-1949) was an Australian born psychologist and Harvard researcher who helped laid the foundation for the human relations movement. Dr. Mohammed Alnaif

Management Human Relations Theories Mayo studied employees at Chicago’s Western Electric Hawthorne Works. He placed his focus on workplace conditions, and how they affected productivity. His study found that relationships work as a key motivator for employees. When working as part of a team, people become more productive. The improvement was so marked that it became known as “The Hawthorne Effect”. Dr. Mohammed Alnaif

Management Maslow’s Hierarchy of Needs Maslow’s Hierarchy of Needs was outlined in 1943 as part of a paper called ‘A Theory of Human Motivation’. It depicts the basic necessities a person must have before they can move towards a ‘higher’ stage of concerns and reach self-actualization. Dr. Mohammed Alnaif

Self-actualization realizing personal potential, seeking personal growth Esteemachievement, independence, respect and status Social belonging being part of a group (family, friends, work). Maslow’s Hierarchy of Needs Safetypersonal and financial security Physiological food, water, warmth and rest “Survivor”

Management Douglas McGregor's Theories X and Y • Douglas McGregor (1906-1964) was an American social psychologist who introduced his X and Y theories in his 1960 book "The Human Side of Enterprise." • Theory X is authoritarian in nature and is used by managers who assume that employees are apathetic or dislike their work. • Theory Y is a participative management style used by managers who believe that workers are self-motivated, responsible and committed to taking ownership of their work. Dr. Mohammed Alnaif

Management Douglas McGregor's Theories X and Y Theory X Assumptions: • Employees are lazy. • They require constant guidance and support. • Sometimes they require even coercion and control. • They would like to avoid work and responsibility. • They do not show any ambition but always seek security. Dr. Mohammed Alnaif

Management Douglas McGregor's Theories X and Y Theory YAssumptions: • Employees consider work as natural as play or rest. • Employees are capable of directing and controlling performance on their own. They are much committed to objectives of the organization. • Higher rewards make these employees more committed to organization. • Most of them are highly imaginative, creative, and display ingenuity in handling organizational issues. • They not only accept responsibility but also look for opportunities to outperform others. Dr. Mohammed Alnaif

Management Herzberg’s Two Factor Theory of Motivation Herzberg developed 2 factors: Herzberg believed that hygiene factors such as company policies, working conditions, and compensation did not serve to motivate individuals, but could cause dissatisfaction. The essential motivators, according to Herzberg, included areas such as interesting work, recognition, and personal growth. Dr. Mohammed Alnaif

Management Management Science Theory Management science theory focused on development of mathematical model. • This approach believes that most of the organizational and business problems can be better solved using different mathematical and statistical techniques. • Management science theory uses linear programming, critical path method, program evaluation and review technique, games theory and break even analysis to make decision. Dr. Mohammed Alnaif

Management Management Science Theory There are three branches of management science theory: Quantitative Management utilizes mathematical techniques such as linear programming, modeling, and queuing theory to help managers to make right decision. Operation Management is concerned with helping the organization to produce its product and service more efficiently and can be applied on wide range of problems. Management Information system is a comprehensive and systematic system which obtains stores and provides different information with regards to the business and management. Dr. Mohammed Alnaif

Management Systems Theory • The system theory approach is based on the notion that organizations can be visualized as systems. • A system is a set of interrelated parts that operates as a whole in pursuit of common goals. • All systems are made up of interrelated and interdependent parts; so is organization. • For example, in a large hospital virtually every department is dependent, in some ways, on the other departments. • Thus we can visualize the hospital as a major unit or system consisting of a host of smaller units or subsystems. Dr. Mohammed Alnaif

Management Systems Theory Four Major Components of a System • Inputsare the various human, materials, financial, equipment, and informational resources required to produce goods and services. • Transformation Process (Conversion) is the organization’s managerial and technological abilities that are applied to convert inputs into outputs. • Outputs are the products, services, and other outcomes produced by the organization. • Feedback is information about results and organizational status relative to environment. Dr. Mohammed Alnaif

Management Contingency Theory is a unique approach to leadership • The basic premise of Contingency Theory is that there is no one best way to lead an organization. • Contingency Theory is the view that appropriate managerial action depends on the particular parameters of each situation. • Contingency Theory of leadership says that a leader must be able to identify which management style will help achieve the organization's goals in a particular situation. Dr. Mohammed Alnaif

Management Theory Z • Theory Z of Dr. William Ouchi's also called "Japanese Management" style popularized during the Asian economic boom of the 1980s. • Theory Z focused on increasing employee loyalty to the company by providing a job for life with a strong focus on the well-being of the employee, both on and off the job. Dr. Mohammed Alnaif

Management Total Quality Management TQM was inspired by a small group of quality experts; of whom W. Edwards Deming was one of the chief proponents. He has also developed and presented his quality philosophy and theory of profound knowledge. TQM represents a counterpoint to earlier management theorists who believed that low costs were the only road to increased productivity. The objective of TQM is to create an organization committed to continuous improvement. Dr. Mohammed Alnaif

Management Knowledge-Based Management (KBM) • KBM employs data and information, rather than feelings or intuition, to support management decisions. • The “Knowledge hierarchy” as it is sometimes called consists of five categories. • Data, Information, Knowledge, Understanding, and Wisdom. Dr. Mohammed Alnaif

Management Knowledge hierarchy • Data symbols or raw numbers that simply exist; they have no structure or organization. Organizations collect data with their computer systems; individuals collect data through their experiences. In short “know nothing” • Information, data that is organized or processed to have meaning. Information can be useful, but it is not necessarily useful. It can answer such questions as who, what, where, and when. “Knowwhat” Dr. Mohammed Alnaif

Management Knowledge hierarchy • Knowledge information that is deliberately useful. Knowledge enables decision making. “Know the how” • Understanding allows use of what is known and enables the development of new knowledge. Understanding represents the difference between learning and memorizing. “Know the why” • Wisdom adds moral and ethical views to understanding. Wisdom answers questions to which there is no correct answer and, in some cases, where there will never be a known correct answer. “Know the right” Dr. Mohammed Alnaif

Wisdom Understanding Knowledge hierarchy Importance Knowledge Information Data Learning Dr. Mohammed Alnaif

Management Knowledge hierarchy A simple example may help to explain this hierarchy. • Your height is 67 inches and your • weight is 175 pounds (Data) • You have a body mass index (BMI) of 26.7 (Information). • A healthy BMI is 18.5 to 25.5 (Knowledge). • Your BMI is high, and to be healthy you should lower it (Understanding). • You begin a diet and exercise program and lower your BMI (Wisdom). Dr. Mohammed Alnaif

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HHA 501 – Health Administration First Semester 1440/ 1441