Different Management Theories

In any organization, teams are the cornerstones of business growth and success. The way you guide, support and motivate your team has a direct impact on increased productivity and business efficiency. Several management practices give rise to leadership approaches that guide and grow organizations. Understanding and applying management theories are an effective way to identify the best strategies that will work for your team and organization.

Management theories are a collection of ideas and concepts surrounding management strategies that include rules, frameworks and guidelines to be implemented in an organization. They address how managers and team leaders implement strategies to achieve organizational targets and motivate individuals to utilize their full potential.

The concept of management theory isn’t new. Over time, different management theories emerged, evolved and continue to be practiced in several business environments. Some theories came into existence several centuries ago but continue to hold relevance even in modern workplaces. Successful leaders don’t rely solely on one theory but use a combination of guidelines and frameworks from multiple theories that best suit their workforce.

Exploring Management Theories And Models

As we’ve already established, different management theories have been floating around in the corporate world for a long time. While some of them are no longer relevant in today’s context, it’s important to learn about them as modern theories of organization emerged from them. If you want to inspire greatness in your team and shine as a manager, here are different types of management theories you can put to use:

Bureaucratic Management Theory

One of the oldest management theories, Bureaucratic Management Theory was developed by Maximilian Karl Emil Weber, better known as Max Weber, who was a German sociologist. It defined how an organization should function—from the way the roles are defined to the manner in which tasks are performed. Building an impersonal, work-based relationship is one of the core elements of his bureaucratic management style. He proposed a set of features that makes an organization efficient:

Predefined roles and responsibilities in an organization
Well-established lines of communication that flow from the top to the bottom
Clear distribution of power based on rank and position
Employees are selected solely on the basis of their technical skills and competencies

His hierarchical approach and clearly defined responsibilities became a commonly adopted management approach and continue to be used even today.

Scientific Management Theory

Another classical management theory, the Scientific Management Theory, was developed by Fredrick Winslow Taylor. Taylor started the scientific management movement with his associates to study how work was performed and how it affected productivity. In his seminal work, The Principles of Scientific Management (1911), Taylor argued that making people work hard wasn’t as effective as optimizing the way they worked. He introduced a scientific approach to productivity, which meant that an increase in efficiency can lead to higher productivity and profits. His principles stated that

All industries should adopt scientific techniques for essential management decisions instead of relying on outdated methods such as the rule of thumb
Businesses should hire the right employees for the job to avoid inefficiency
Cooperation between managers and employees is of great significance and efforts should be made to improve group dynamics
Change in employee attitude and behavior is instrumental in rolling things out in a time-efficient manner
Implementing, training and learning best practices will maximize employee output that’ll increase the overall efficiency of the organization

Administrative Management Theory

In his 1916 work, Administration Industrielle et Générale, Henry Fayol, a French mining engineer, laid down five functions and 14 principles of management under the theory of Fayolism. He believed that these functions and principles can guide managers to fulfill their responsibilities effectively and they should have the liberty to determine how to use them. This school of thought came to be known as Administrative Management and the 14 fundamental principles include:

Division of work:

Dividing and delegating work based on the individual skills, experiences and motivations

Authority and responsibility:

Managers must align their responsibilities with their authority to lead effectively

Discipline:

It’s about respecting the rules, policies or regulations of any organization

Unity of command:

Every employee should report to only one manager or senior

Unity of direction:

There may be different levels within a team but it should come from one place and lead to one destination

Subordination of individual interest to general interest:

Individual employee goals need to align to larger organizational goals

Remuneration:

The remuneration must be fair across departments and levels to keep employees motivated

Centralization/decentralization:

Whether authority is concentrated in a few hands or several is determined by centralization and decentralization

Scalar chain:

The chain of command differs between organizations; it may be vertical (upward or downward) or horizontal (across)

Order:

Each employee, materials and machine must have their own place in their organization to simplify processes

Equity:

All employees in the organization must be treated with equity or fairness

Stability of tenure of personnel:

Employees should be given enough time to settle into their roles and get used to their responsibilities

Initiative:

Rather than treating employees like cogs in a machine, encouraging them to take initiative and giving them the authority to make decisions

Esprit de corps:

Organizations that are high on team spirit, ‘esprit de corps’, and team-building stand the test of time

Human Relations Theory

Developed by Elton Mayo, an Australian psychologist, the Human Relations Theory of management was proposed after a series of experiments, also known as Hawthorne Studies or Hawthorne Experiments. This theory emerged as a response to the criticism faced by the classical management theories, where social factors such as human behavior and attitudes weren’t considered important. The Human Relations Management Theory suggests that:

Humans are complex and different factors influence their behavior
Group dynamics (team relations) influence job performance and output
Managers should understand that employees have unique needs and one size doesn’t fit all; communication is essential between managers and employees
People aren’t solely motivated by compensation; finding meaning in their work is important as well
Employees are more open to change when given the opportunity to participate

Theory X And Y

One of the modern theories of organization, Theory X and Y was proposed by a management professor named Douglas McGregor. According to the theory, a manager’s assumptions play a critical role in determining employee behavior and performance. He suggested that there are two types of assumptions—X and Y—that create a significant impact on the functioning of an organization.

Theory X is focused on negative assumptions, where a manager assumes that employees are habitually disinterested in working. Most of them work aimlessly, without any ambitions for growth or new opportunities. They need to be monitored so that they can perform well.
Theory Y deals with positive assumptions, where a manager assumes that employees are in the habit of putting in concerted physical and mental effort to perform their duties. They don’t always need threats, force or minute monitoring. Once a task is assigned to them, they are driven enough to complete it and contribute towards the organization’s goals.

As you can see, with the evolution of management theories over time, the focus shifted from the system and machinery to the people and teams involved. Therefore, you need to consider multiple aspects of an organization to master the art of efficient management.

Usefulness Of Management Theories And Approaches

Managers and team leaders shoulder the additional responsibility of guiding and motivating their teams to achieve common goals and targets. Here are various reasons why leaders should understand and apply the principles of relevant management theories:

Maximized Productivity

Management theories and approaches help in maximizing employee productivity. By understanding how your team functions and progresses, you can learn how to make the most of your team members’ skill sets. Finding ways to improve performance increases productivity and efficiency. For example, the Scientific Management Theory suggests ways to maximize the productivity of unskilled employees by observing their process.

Simplified Decision-Making

While Weber’s Bureaucratic Management Theory stresses the importance of organizational hierarchies, several modern theories of organization suggest otherwise. They propose a flattening of hierarchy, which would further reduce the time taken for communication, innovation and decision-making. Speeding up the decision-making process leads to enhanced efficiency.

Improved Participation

The Human Relations Management Approach recognizes the importance of social aspects such as behavior, attitude and employee engagement. By treating employees as a part of the process of change, there is a greater emphasis on psychological and sociological aspects of management. This further encourages staff participation and increases collaboration and cooperation among team members.

Increased Objectivity

The Scientific Management Theory focuses on objectivity through its scientific approaches. Management decisions are often the result of personal judgment and bias, which can affect work processes. By making scientifically proven changes, you can improve employee productivity in the most effective manner. Therefore, management theories challenge outdated approaches and encourage scientifically backed strategies.

Greater Flexibility

Most importantly, management theories prepare your organization for change. Whether it’s internal or external, the theories help you navigate how these changes affect the business. By helping you prepare and adapt to changing circumstances, management approaches encourage you to keep an open mind and be flexible in the face of change.

Applying Management Theories

Practicing the principles of various management theories will not only bring success to your organization but also improve your relationship with your team. A strong team bond can make a big difference in driving peak performance at work. To successfully apply relevant management strategies, you need to gauge the needs and expectations of your team.

Harappa’s Managing Teamwork course is designed to equip you with tools to imbibe team culture and collaborate with people with different working styles using emotional intelligence. The Bruce Tuckman Model will teach you about the different stages of team formation and growth. The GRIN—Goals, Roles, Interdependence, and Norms—Framework will help you familiarize yourself with the key characteristics of effective teams. Assess your team’s strong points to help them perform their best. Don’t just manage, lead your team to success with Harappa!

Explore Harappa Diaries to learn more about topics such as Strategic Management, All About Performance Management, Various Functions Of Management and Henri Fayol’s 14 Principles Of Management to become a well-rounded professional.

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