Management and organization Theories and
approaches
Table of content
Management theories.........................................................................2
The classical theory............................................................................................. 3
Human Relations Theory..................................................................................... 3
Contingency Theory............................................................................................ 3
Systems theory................................................................................................... 4
Organisational behaviour a multidisciplinary approach.........................5
Organisational theory.......................................................................................... 7
Interrelated influences on (Organizational) behavior........................................7
Culture...............................................................................................8
Hofstede’s dimensions of culture........................................................................8
Trompenaars’ framework for analyzing cultural differences...............................9
How do individuals differ (Personality)...............................................10
Nomothetic Approach........................................................................................ 11
Hans Eysenck: theory of main personality types............................................11
Carl Jung: personality type matrix..................................................................12
Raymond Cattell: identification of personality factors and traits....................12
Idiographic Approach........................................................................................ 13
Sigmund Freud a psychodynamic perspective................................................13
Erik Erikson: eight stages of personality development...................................14
The Myers-Briggs Type Indicator (MBTI).........................................................15
George Kelly's: Personal Construct Theory.....................................................15
Other personality traits at work.........................................................................15
Personality and job performance....................................................................18
Attitudes............................................................................................................ 18
values................................................................................................................ 19
Classifications of organisation by major purposes...............................20
Common feature of organisations...................................................................20
Classification of organisations by types of authority.........................................22
Conflict........................................................................................................... 22
Learning...........................................................................................23
Behaviorists....................................................................................................... 24
Classical Conditioning..................................................................................... 24
Operant Conditioning...................................................................................... 25
Cognitivists........................................................................................................ 26
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, Kolb's Learning Cycle...................................................................................... 27
Honey and Mumford styles of learning...........................................................28
Bandura's Social Learning Theory...................................................................29
Knowledge Management................................................................................... 30
Attribution theory.............................................................................31
Three determents of attribution........................................................................32
Control orientations........................................................................................ 32
Perception as information processing................................................32
Perception and factors that influence it............................................................33
Perceptual distortions and errors....................................................................34
Social perception model.................................................................................... 34
Impression management (self-presentation).....................................................35
Communication and listening............................................................................35
Needs...............................................................................................37
Maslow's Hierarchy of Needs............................................................................. 38
Clayton Alderfer's Modified Need Hierarchy Model...........................................38
Work motivation and job satisfaction.................................................39
Work attitudes................................................................................................... 39
Extrinsic and Intrinsic motivation....................................................................40
McClelland's Achievement Motivation Theory...................................................40
Relationship between the achievement need and job performance...............40
Herzenberg two-factor theory...........................................................................41
The three key elements of motivation...............................................................41
Expectancy theory.......................................................................................... 41
Goal-Setting Theory........................................................................................ 42
Equity Theory.................................................................................................. 42
Job Characteristic Model................................................................................. 42
Challenges to Job Design................................................................................ 42
Groups and teams.............................................................................42
Types of Groups................................................................................................ 43
Group think..................................................................................................... 44
Team effectiveness model................................................................................44
Types of teams............................................................................................... 45
Belbin's Team Role Theory............................................................................. 45
Mock Test.........................................................................................46
Additional questions.........................................................................50
MANAGEMENT THEORIES
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, THE CLASSICAL THEORY
The classical theory of management views organizations like well-organized machines with a clear
hierarchy. It's all about getting work done efficiently and workers are chosen for their skills and
closely supervised.
KEY PARTS OF CLASSICAL THEORY
1. Scientific Management (Taylorism): This part is all about making things as efficient as
possible, treating workers like parts of a machine.
2. Administrative Management (Fayolism): This focuses on control and efficient management
processes.
3. Bureaucratic Management (Weberian Bureaucracy): It sees strict rules and structure as the
best way to run an organization.
PROS OF CLASSICAL THEORY
Clear tasks, instructions, and rewards can make people work more efficiently.
CONS OF CLASSICAL THEORY
It doesn't think much about the human side, which can lead to people feeling lonely or
stressed.
It sticks to one way of doing things, which can hold back new ideas and changes.
HUMAN RELATIONS THEORY
Human relations theory is all about how important people are in organizations. It focuses on building
good relationships, keeping people motivated, and making sure there's diversity in how we manage.
The Big Turning Point: The Hawthorne Studies In the 1920s-1930s, a set of studies at the Hawthorne
plant showed some interesting things:
1. Illumination Experiments: Bright or dim lights don't have an effect on how well people work.
2. Relay Assembly Test Room: Being part of a group and feeling like you belong can make
people work better.
3. Interviewing Program: If workers are happy, they work better. This led to things like
counseling to keep them happy.
4. Bank Wiring Observation Room: Having friends at work can be more important than getting
paid more.
Human relations theory changes how we think about managing organizations. It says that we need to
focus on people, keep them motivated, and understand how they work together. Building positive
relationships and recognizing the uniqueness of each person in the organization is key.
CONTINGENCY THEORY
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,Contingency Theory helps us understand how flexible organizations work. It says there's no one-size-
fits-all management style and that we must change based on what's happening inside and outside
the organization.
Rejecting the "One Best Way" Approach Contingency Theory doesn't believe in one perfect way to
manage everything. It thinks that what works depends on the situation. So, you need to be adaptable
to get the best results.
Factors Shaping Organizations There are two things that shape how an organization is: internal
factors, such as their type and the people within, and external factors, including advancements in
technology and the evolving world that surrounds them.
Environment's Influence on Organizations The outside world changes organizations. New tech shifts
in the market, and other outside things really matter. So, organizations need to be flexible in how
they do things to stay competitive.
Flexibility in Response Contingency Theory says you should be flexible. Look at Amazon and Google,
they keep changing to stay on top. Being able to adapt is super important.
Conclusion Contingency Theory is all about adjusting to the way organizations are changing. There's
no single way to manage everything, and you must be ready to switch things up. Also, remember, as
things change, theories need to change too, and you need the right theory to do well.
SYSTEMS THEORY
Embraces both the classical approach and human relations approach. Organizations are considered
to be an open system interacting with other, broader systems. Technical and socials sub-systems are
part of the organization.
THE OPEN SYSTEMS MODEL OF ORGANISATIONS
The open systems model of organizations, rooted in systems theory, views organizations as dynamic
systems that convert inputs taken from their environment (like resources and information) into
outputs (goods, services) and send them back to the environment to achieve their goals.
So, what it got from the environment is transformed into products services based on the purpose of
the organisation and send back to the environment.
These systems view of organizations allows for the application of general organizational behaviour
principles while recognizing organization type, purpose, and the environment influence how people
interact within them.
SUB-SYSTEMS
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, 1. Task: This is about the organization's goals and what work needs to be done, including what
comes in and what goes out.
2. Technology: It's about how the work is done, the materials, tools, and procedures used.
3. Structure: This is the organization's shape, how authority is set up, communication lines, and
how tasks are divided and coordinated.
4. People: This focuses on the individuals doing the work, their skills, attitudes, needs, how they
work together, and how they're led.
5. Management: This is about how everything is coordinated, from tasks to technology,
structure, and people, including the organization's strategies and interactions with the
outside world.
ORGANISATIONAL BEHAVIOUR A MULTIDISCIPLINARY
APPROACH
Organizational behavior (OB) is like a mix of different sciences to understand how people behave in
organizations; OB draws from:
1. Psychology: This helps us understand how individuals behave (perception, attitudes, and
motives). It involves experts who study things like how personalities affect work and how to
improve working conditions.
2. Sociology: This field studies how people act in groups and how organizations are structured.
It looks at things like culture, technology, power, and conflict.
3. Social Psychology: This is like a mix of psychology and sociology. It looks at how people affect
each other, deal with change, and work in groups. It deals with things like attitudes,
communication, trust, and conflict.
4. Anthropology: Anthropology is all about studying societies to understand human activities,
like culture and the environment. In OB, it helps us understand differences in values and
behaviors across different places and organizations.
So, OB uses these different areas to understand how people behave as individuals and in groups
within organizations.
MANAGEMENT OF HUMAN CAPITAL
Intellectual capital
Emotional capital
Social capital
Research shows that Human Capital (HC) development is linked to performance and highlights the
importance of Social Capital in creating value and fostering innovation. At the individual level,
investing in education and training enhances skills and earnings, while at the organizational level, HC
supports competitive advantage and strategic goals.
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,FEW ABSOLUTES IN OB
Organizational behaviour differs from the consistency found in physical sciences like chemistry and
physics. Human behaviour is complex, and people's actions can vary greatly in different situations.
This means that organizational behaviour concepts should consider situational factors (contingency
factors) represented by "Z." While we can predict that "X leads to Y," it only holds true under specific
conditions defined by Z, like the quality of work life. This interaction can result in synergy, where 1 +
1 can equal 3, can occur under the right circumstances, like a quality work environment.
CHALLENGES AND OPPORTUNITIES FOR OB
Understanding organizational behaviour is crucial for managers due to ongoing changes in the
business world. These changes include an aging workforce, increasing diversity, and global
competition, which demand flexibility and adaptability from employees. Despite these changes, they
also present opportunities and challenges for managers to apply organizational behaviour concepts
effectively, these are:
• Responding to economic pressure.
Effective management is especially important during tough economic times. Employees look
to their managers to provide security during the instability of e.g., a recession.
• Responding to globalization.
In a globalized world, organizations must adapt to diverse cultures and workforces. This
includes understanding new locations, fostering cultural sensitivity, and coping with
differences in motivation and practices. Managers face the challenge of working with people
from various cultures, both internationally and domestically, and must also balance
organizational interests with community responsibilities. To succeed, they need to be aware
of cultural norms and business practices in each country where they operate.
• Managing workforce diversity.
Is a significant challenge for organizations as they become more diverse in terms of
employees' gender, age, race, ethnicity, sexual orientation, and other characteristics. This
diversity management is a global concern.
• Diversity implications.
Diversity in organizations creates opportunities and questions for managers and employees.
how can we leverage differences within groups for competitive advantage? should we treat
all employees alike? should we recognise individual and cultural differences? what are the
legal requirements in each country? does increasing diversity even matter?
• Improving customer service and people skills
Service employees, including those in various roles like technical support, sales, healthcare,
and customer service, frequently interact with customers. Organizational behaviour provides
insights into how employee attitudes and behaviour impact customer satisfaction.
• Working in networked organizations.
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, Networked organizations enable remote collaboration across great distances, exemplified by
COVID-19. In such organizations, managers face unique challenges in motivating, leading, and
making collaborative online decisions. As more employees work through networks, managers
must acquire new skills. Organizational behaviour offers insights to develop these essential
skills.
EMOTIONAL INTELLIGENCE (EI OR EQ)
Is a concept developed by Goleman that emphasizes the importance of understanding and managing
emotions. It includes self-awareness, self-regulation, social skills, empathy, and motivation. EI is vital
for personal success and effective people management. It helps build better relationships and
manage workplace stress. However, there's also a darker side to EI, where it can be used to
manipulate others for personal gain.
ORGANISATIONAL THEORY
Organizational theory emphasizes that no single approach fits all situations. It explores how
organizations are structured and managed, offering insights for managers to adapt their behavior and
practices. Effective theory must be both appropriate and effective. It helps understand the past,
present, predict the future, and adapt organizational aspects to achieve goals.
INTERRELATED INFLUENCES ON (ORGANIZATIONAL) BEHAVIOR
The individual
Individuals are essential in organizational behavior, and conflicts can emerge when personal needs
clash with organizational demands. Management's role is to create a harmonious work environment
where both individual needs and organizational goals are balanced.
The group
Groups are a fundamental part of organizations, with individuals belonging to one or more groups.
Social needs lead to informal groups, and the interplay between individuals and groups influences
behavior. Group dynamics play a significant role in shaping organizational dynamics.
The organization
Individuals and groups interact within the formal organizational structure to establish role
relationships, create order, and direct efforts toward achieving organizational goals. The structure
influences behavior through technology, leadership styles, and management systems, which are used
to plan, direct, and monitor organizational processes.
The environment
Organizations are impacted by various factors like internationalization, technology, economics,
culture, government actions, and ethics. Organizational behavior and HR management occur in the
context of this ever-changing external environment, and it's crucial to understand how organizations
adjust to these external influences/demands.
THE ORGANIZATIONAL ICEBERG THEORY
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, Morgan talks about how organizations are really complicated. It's like an iceberg - what we see is just
a small part, and most of what's important is hidden. People's real reasons for how they act at work
are often not obvious.
Wilson adds to this idea by saying that understanding "organizational behaviour" isn't simple. He
thinks we shouldn't just look at how people act inside organizations, but also think about what's
happening outside the organization what affects it. This broader view can help us understand more
about how people feel, how emotions and the things around us influence how we work.
SOCIAL EXCHANGE THEORY
Social exchange theory is about how people interact, often at work, with an expectation of mutual
benefit. It's like a 'give and take' arrangement where individuals expect rewards for what they
contribute. This theory emphasizes that social behaviour is driven by the exchange of social and
material resources, where people seek a positive balance by maximizing benefits and minimizing
costs in their interactions.
THE PSYCHOLOGICAL CONTRACT
The concept of the psychological contract, rooted in the social exchange theory is based on the idea
that in workplaces, people expect something in return for what they give, and this an unwritten or
formal agreement but an expectation that shapes how they see their relationship with their bosses
and the organization. It's like a mutual understanding where they believe they'll get something back
for their efforts from their managers. This has a major influence on job satisfaction, attitude, and
levels of performance. They use a simple formula: caring, communicating, listening, knowing, and
rewarding.
THE PETER PRINCIPAL
The Peter Principle says that in a hierarchy, if you're good at your job, you'll keep getting promoted.
But you'll eventually get promoted to a job where you're incompetent, and that's where you'll stay.
PARKINSON’S LAW
Parkinson's Law simply means that the more time you have to do something, the longer it will take
you to get it done. So, if you have a long time to prepare for an exam, you might end up
procrastinating and only start studying closer to the deadline.
CULTURE
Globalization changes how organizations work worldwide. It means they join the global economy,
compete internationally, and adapt to diverse cultures. Understanding culture is crucial for handling
diversity and teams. While general theories can be useful, they might have cultural biases and
therefore not work well in every culture. So, being open to different cultures is key to succeeding in
global management.
HOFSTEDE’S DIMENSIONS OF CULTURE
Is about understanding how culture affects the workplace. He started by looking at one organization
but then realized it's more about how different countries have their own culture. He said culture is
like the "collective programming or software in our minds” that makes us act a certain way. He came
up with four main cultural dimensions:
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