Behavioural Management Theories

1. Behavioural Management Theories BOH4M

2. McGregor’s Theory X/Y • The Theory X approach… • Employees are naturally lazy/avoid work, don’t want responsibility, and fear changes and challenges • The Theory Y approach… • Employees like work, seek responsibility, show initiative and creativity, are excited by changes and challenges

3. McGregor’s Theory X/Y • Theory X Managers: Authoritarian, repressive, exert tight control, no employee involvement, pessimistic • Theory Y Managers: Liberating, empowering, gives employees responsibility and freedom to develop, optimistic

4. McGregor and the Self-Fulfilling Prophecy • Whether a manager has Theory X assumptions, or Theory Y assumptions about their employees, they’re right • Your assumptions dictate how you manage, and the employees will respond accordingly • Workers in a Theory X environment are unmotivated, lazy, rebellious, and work poorly • Workers in a Theory Y environment are motivated, loyal/committed, productive, take pride in their work and respect managers

5. Argyris’s Theory of Adult Personality • Based heavily on Maslow and the Hawthorne Studies • Argues that classical management approaches are inappropriate for mature adults, and can be counter-productive

6. Critiques • Scientific management states that tasks should be defined as specifically as possible, but Argyris believes this may inhibit self-actualization • Weber’s bureaucratic organization had a clear hierarchy in which people follow orders from above, but Argyris argues that this will create dependent workers who feel they have no control over their environment • Fayol’s administrative principles assume productivity is maximized when an employee’s work is planned and supervised by a superior, but Argyris suggests that it’s much better for people to define their own goals

7. Argyris’s Theory of Adult Personality • Also a believer in the “self-fullfilling prophecy” of management – that if a manager believes workers are willing workers who want to do a good job, then they will treat them as such, and will see positive results • Called for expanded job responsibilities, variety, and the opportunity for more participation in decision-making

8. Modern Management Theories

9. Systems Thinking • Views an organization as a system • A system is a group of people working together for a common purpose • An organization can contain subsystems (smaller groups working together for a common purpose that serves the overall goals of the larger system) • Important to recognize an organization as an open system, one that is affected by, and can affect, its environment

10. Contingency Thinking • There is no one single style of management that suits all organizations/situations • The most effective management style will vary depending on the type of organization, its size, its environment, and the particular situation/problem it faces at the time • Sometimes a bureaucratic organization is most effective, sometimes a more loosely structured one; sometimes a more classical approach is best, sometimes a more modern one

11. Total Quality Management • Known as TQM • A management philosophy that demands a commitment to quality in all aspects of an organization and at every step in the value chain, from suppliers, through to manufacturing and customer service

12. The Learning Organization • Similar to “continuous improvement” • Focuses on enhancing the systems (including people) within an organization to continually increase the organization's capacity for performance • Basically: learn from your mistakes; and never be satisfied with your current level of performance

13. Theory Z • Developed by Dr. William Ouchi • Not necessarily an offshoot of McGregor’s Theory X/Y, Ouchi’s theory blends modern western management approaches with Japanese management techniques • Ironically, many so-called “Japanese” management techniques such as Kaizen are based on American Edward Deming’s 14 Points For Management • Theory Z focuses 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 • This means stable employment, and high employee morale and satisfaction by creating opportunities for collaboration, lateral job movements, and mulit-level participation in decision-making

14. Others…. • There are many, many different management theories developed by business profs, former executives, consultants, and authors • Some popular are really just recycling old ideas

15. For Example… • Sun Tzu’s The Art of War • Written around 500 BCE • Highly influential book of military strategy that contains insights relevant to the world of competitive business • Many Japanese companies make it required reading for their executives • It has been the subject of at least 3 business strategy books