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Classic and Neoclassic Approaches to Organization using Theories

306 Downloads1 I Published: 01 Nov ,2019

Introduction

Organizational theories includes various approaches to organizational analysis (Mokhtari and et.al., 2012). These theories includes the various rational system perspective, division of labour, bureaucratic theory, and contingency theory. This report includes the classic and neoclassic approaches to organization with relevant theories.

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Part A

Classical and scientific management - The Classical school The Scientific–Rational approach

Frederick Taylor and Scientific Management: This theory was developed by the Frederick Taylor in 1909 with have a mechanical engineering background (Hoey, 2012). The main focus of that theory on efficiency. He published the principles of scientific management which tells that with the help of optimizing and simplifying jobs, productivity would be increased. The new idea introduced through that theory is about the cooperation of managers with their employees at workplace. According to the theory of Taylor the employee motivation depend on the money which paid to them for their work. Before introducing that theory the superiors have very little contact with their workers but after the implementation of that theory the working conditions were improved. Now in those days workers have great contact with their superiors so that they have rare conflict among the workers. The main focus of that theory to motivate employee by monetary benefits only.

Henry Fayol's theory and principles of Management and Organization: Henry Fayol's theory introduced by Henry Fayol in 1929. He provided 14 principles of management which helps in better management in a organization. This theory brings to of the previous one because it provides more principles of management which helps a organization in achieving their Goal. These principles are the basic guidelines to management of organization as whole. These principles are introduce by Henry Fyol on the basis of his long experience which he gained from his managerial post. These principles are as follows:

Division of work According to that principle the whole work will be divided into specific job or tasks, which will allotted to the employees as per their interest and their skills and capabilities so that the standards of work can be achieved successfully. Authority and responsibility-according to that there should be a good balance between authority and responsibility, a employee have must be sufficient authorities to perform their responsibilities. Discipline-An employee should be very honest, respectful and obedient towards the organization (Bueger and Gadinger, 2018). For example, clarity of rules and regulation, reorganization and reward system, etc.. Unity of command- There must be uniformity in the command. For example, a employee must be supervised by single supervisor and guided by him only. Unity of direction-According to that principle the one department of organization should have only one head. Subordination of individual interest to general interest-according to that principle there should be harmony between the interest of individual and organization. For example, if a worker doing good work then organization have interest in paying good. Remuneration of personnel- According to that principle the non monetary benefits create a strong bounding between the employees and organization. For example, if a worker get a fair , reasonable and satisfactory relation then he will work with more efficiency. Centralization -According to that principle the top level authority remains with that level only and all the important decisions should be remain with this level. For example, all the decision related to the new innovation, investment, etc.. will be taken by top level. Scalar chain-there must be specific chain of staffs according to their level in the organization. For example, boss of the organization at top level then superior may lower from him etc.. order- Every task and material have a specific place in the organization. For example, on a tough job task more manpower will be assigned. Equity-the all members in the organization should be treated as equally. For example, low level employee and top level employees treated equally by the managers there should not be any biases according to their position.

Same as the stability of tenure, initiative and esprit de corps will also specify some guidelines to the management of organization as a whole.

Max Weber theory of bureaucracy and the principles of a Bureaucratic Organization: Max Weber develop the Bureaucratic theory which contains two essential elements such as hierarchy of organizational structure and clear rules and regulation. This theory brings on the top of previous theories because it more emphasis on qualification of staffs not on their technical skills (Hillier, 2017). It contain principles which are as, Proper division of labor-Division of labor specialization should be fixed in an organization so that balance maintained between power and responsibility. Chain of command-The flow of information should be very clear and according to hierarchy system. Separation of personal and official property-The assets of the owner and the organization should be separate according to that principle. Application consistent and complete rules-The rules and regulation should be properly defined in the organization so that operations can be run smoothly.

Selection and promotion- The selection of staffs based on the qualification of them it should not be based con personal relation.

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Criticism of Classical approaches and The Human Relations school

The following theories criticism the above explained theory because of new and modernization concepts.

The Hawthorne Studies-program conducted by Elton Mayo and Human Relations Approach-social factors influence productivity and employees are valued: The previous theories explained about the only traditional approaches such as division of labor, increment in efficiency etc.. Elton Mayo is the founder of human relation theory that theoryconsider the modern approaches of increasing efficiency and productivity (Silver and Lewins, 2014). It consist the various aspects such as personal attention to employees, labor motivation, soft corner for employees. Complex humanity, etc..

Abraham Mas low's Hierarchy of Needs Theory-5 levels, lower needs must be met before higher needs: This theory is introduced by the Abraham Maslow with a number of needs of employee which motivate him. It criticize the theory previously introduced by Fredric Taylor which states that only monetary benefits motivate the employees. According to that theory employees can be motivate through Physiological, security, social, and esteem needs are deficiency needs, which arise due to deprivation. Satisfying these lower-level needs is important in order to avoid unpleasant feelings or consequences.

Douglas McGregor’s Theory X assumptions andTheory Y assumptions: McGregor introduced that theory which explain the various aspects of leadership styles (Edwards and Bowen, 2013). It criticize the Henry Fyols theory by way of introducing various methods of command. It represent the two sub theories such as theory X and theory Y. theory X explains that the peoples are lazy, avoid works and responsibilities so it suggest the autocratic leadership style and summarize the traditional view of leadership. Theory Y comprises the different needs of people which motivate them so it suggest democratic leadership style.

Contingency Theory and its criticism:A contingency theory is an organizational theory that claims that there is no best way to organize a corporation, to lead a company, or to make decisions. Instead, the optimal course of action is dependent upon the internal and external situation. A contingent leader effectively applies their own style of leadership to the right situation. The contingency theory beneficial for some the organizational factors such as technology, suppliers and distributors, consumers, customers and competitors, government and unions. That theory criticize the max Weber and Taylor scientific approaches.

Part B

Customer-orientation

It can be defined as the approach to customers relationship in which staff of the organization works on the helping customers to meet their requirement and wants. This approach whole related with the satisfaction and retaining customers (Berry, Broadbent and Otley, 2016). It can be reached through the Tom Peters and Robert H. Water man theory. According to the peters and Robert a theme can be followed which emphasis on the relations close to customers. With the help of following steps customers orientation can be achieved through CVP- first of all create a value proposition for the customers, Recruit customer friendly staff- the staffs must be customer friendly so that the effective business communication can be take place while interacting with customers, Treat employees well- the employees of the organization must be satisfy the organization working condition because their behavior depend upon their satisfaction level.

Such as some other factors also included in that, for example, define the standards of organization, listen the customers voice, implement core program, walk the talk and etc..

Cultural Excellence

A “culture of excellence” is, by definition, out of the ordinary. Creating such a culture requires a vision of what is possible, a plan to set it in motion, and the practices to generate it on an ongoing basis (Ridley-Duff and Bull, 2015). It is propose by the Peter and warterman theory, they used the framework for analysis is 7-s model. The model includes the following seven success criteria for excellence such as structure, strategy, system, shared values, skills, staffs and styles. The characteristics of cultural excellence makes it very clear. The characteristics are as An Organizational Vision is, Communicated and Understood, clear Purpose and Meaning, Mastery of Roles and Focus on, High Performers, Resilience to Change and Challenge, Highly Collaborative Teams, Pioneer Mentality.

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Organizational culture

Organizational cultural can be defined as the organizations experiences, values and inner workings, interaction with outer environment, etc.. the organizational culture is defined by the Handy's model . The organizational culture according to Handy's model as follows:

Power culture in an organization with a power culture, power is held by just a few individuals whose influence spreads throughout the organization (Huang and Teghem, 2012). There are few rules and regulations in a power culture. What those with power decide is what happens. Employees are generally judged by what they achieve rather than how they do things or how they act. Organizationswith a role cultureare based on rules. They are highly controlled, with everyone in the organization knowing what their roles and responsibilities are. Power in a role culture is determined by a person's position (role) in the organizational structure. Task cultureforms when teams in an organisation are formed to address specific problems or progress projects. The task is the important thing, so power within the team will often shift depending on the mix of the team members and the status of the problem or project. Whether the task culture proves effective will largely be determined by the team dynamic. With the right mix of skills, personalities and leadership, working in teams can be incredibly productive and creative.

organizations with person cultures, individuals very much see themselves as unique and superior to the organization. The organization simply exists in order for people to work. An organization with a person culture is really just a collection of individuals who happen to be working for the same organization.

Japanese Management- the Japanese approach

Distinct features approach defines that features of the product and services of the organization always carry distinct features from the other organizational services and product. Such as if the organization launches a new TV then it must carry distinct features such as sound quality and screen quality etc. Personnel policiesdefines as the guidelines and policies which is formulated to manage its workers and employees (Billari and Prskawetz, 2012). It describes the job performance and other factors related to it. For example organization have to make its policies regarding motivational needs of employees. Decision-Makingrefers to the taking decisions about every issues and innovations in organization. According to Japanese approaches it will be in favor of the both employees as well as organization. For example, a organization if take decision about producing new product then it must have to consider all the factors related to production of it. If these factors harmful for employees health then further decisions will be taken.

Conclusion

At the end it can be concluded that the various classical and neo classical theories are beneficial for all type of business but these will be applicable as situational. There are various criticism to these theories which suggest improvement in these theories. Japanese approaches explains further management approaches to an organization.

References

  • Mokhtari, K., and et.al., 2012. Decision support framework for risk management on sea ports and terminals using fuzzy set theory and evidential reasoning approach. Expert Systems with Applications. 39(5). pp.5087-5103.
  • Dumay, J.C., 2012. Grand theories as barriers to using IC concepts. Journal of Intellectual Capital. 13(1). pp.4-15.
  • Hoey, M., 2012. Lexical priming: A new theory of words and language. Routledge.
  • Bueger, C. and Gadinger, F., 2018. International practice theory. Palgrave Macmillan.
  • Hillier, J., 2017. Stretching beyond the horizon: a multiplanar theory of spatial planning and governance. Routledge.
  • Silver, C. and Lewins, A., 2014. Using software in qualitative research: A step-by-step guide. Sage.
  • Edwards, P. and Bowen, P., 2013. Risk management in project organisations. Routledge.
  • Berry, A.J., Broadbent, J. and Otley, D.T. Eds., 2016. Management control: theories, issues and practices. Macmillan International Higher Education.
  • Ridley-Duff, R. and Bull, M., 2015. Understanding social enterprise: Theory and practice. Sage.
  • Huang, S.Y. and Teghem, J. eds., 2012. Stochastic versus fuzzy approaches to multi objective mathematical programming under uncertainty (Vol. 6). Springer Science & Business Media.
  • Billari, F.C. and Prskawetz, A. eds., 2012. Agent-based computational demography: Using simulation to improve our understanding of demographic behaviour. Springer Science & Business Media.
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