DEPARTMENT OF POLITICAL SECIENCE EDUCATION University of Education, Winneba Course Code and Title: POLI 356: Organisation Theory Lecturer: Dr. Maliha Abubakari Email: maliha2008@yahoo.com Outline of Presentation 1. The Neo-Classical Theories 2. Alton Mayo and the human relations school 3. Herbert A Simon 4. Chester Bernard, the Management Theorist 5. Abraham Maslow’s Theory of Hierarchy of Need 6. Theory X and Y – Douglas McGregor 7. Next steps A recap of last week’s lesson: The Classical Theories Three scholars were discussed under the classical theories Review of Last Week’s Assignment Alton Mayo and the human relations school The Neo-classical/Human Relations Theories Neo-classical theory revises or is critical of classical organisation theory. The neo-classical or human relations theory initiated the movement away from the overly simplistic mechanistic views of classical organisation theory. It criticised the classical school for minimising issues related to : 1. the humanness of organisational members 2. the coordination needs among the administrative units 3. the operation of internal-external organisational relations 4. the processes used in decision making It has also been criticised for over conformity and rigidity, thus squelching creativity, individual growth, and motivation. Major Assumptions of the Neo-classical or Human Relations Theory Organisations exist to serve human needs (not the reverse) Organisations and people need each other (organisations needs ideas, talents and energy and people need careers, salaries and work opportunities) When the fit between the people and the organisation is poor, one or both will suffer, individuals will be exploited or will seek to exploit the organisation or both. A good fit between individual and the organisation benefits both Mayo and the Human Relations School One of the first experiments that challenged the classical view was conducted by Mayo and Roethlisberger in the late 1920's at the Western Electric plant in Hawthorne, New York (Mayo, 1933). While manipulating conditions in the work environment (e.g., intensity of lighting), they found that any change had a positive impact on productivity. Mayo summarises the results of the Hawthorne experiment as follows: The conditions of the scientific experiment had apparently been fulfilled – experimental room, control room; changes introduced one at a time; all other conditions held steady. The results were surprising … lighting improved in the experimental room, production went up, but it rose also in the control room. The opposite of this: lighting diminished from 10 to 3 foot candles in the experimental room and the production again went up; simultaneously in the control room, with illumination constant, production also rose (1945:69) The ’Hawthorne effect’ was discovered: Change was interesting; Attention is gratifying! Thus, the act of paying attention to employees in a friendly and nonthreatening way was sufficient by itself to increase output. At the social psychological level, the Hawthorne studies pointed to a more complex model of worker motivation based on social psychological rather than an economic conception of man. At the structural level, the studies discovered and demonstrated the importance of informal organisation. The Hawthorne experiments gave rise to numerous offshoots. The major research issues pursued include studies of the work group in organisational environment, leadership behaviour and the impact of worker background and personalityattributes on organisational behaviour. Herbert A Simon (the theory of Bounded Rationality) In his influential book Administrative Behaviour (1947), Simon sought to replace the highly simplified classical approach to economic modeling—based on a concept of the single decision-making, profit-maximizing entrepreneur—with an approach that recognized multiple factors that contribute to decision making. Rational Decision Making: In modern Western societies the most common understanding of decision making is that it is rational—self-interested, purposeful, and efficient. During rational decision making, individuals will survey alternatives, evaluate consequences from each alternative, and finally do what they believe has the best consequences for themselves. In the 1940s, organization theorists began to challenge two assumptions necessary for rational decision making to occur, First, information is never perfect, and individuals always make decisions based on imperfect information. Second, individuals do not evaluate all possible alternatives before making a choice. This behaviour is directly related to the costs of gathering information, because information becomes progressively more difficult and costly to gather. Instead of choosing the best alternative possible, individuals actually choose the first satisfactory alternative they find. Simon attempted to determine the techniques and/or behavioral processes that a person or organization could bring to bear to achieve approximately the best result given limits on rational decision making. Simon writes: The human being striving for rationality and restricted within the limits of his knowledge has developed some working procedures that partially overcome these difficulties. Instead of choosing the best alternative possible, individuals actually choose the first satisfactory alternative they find. The American social scientist Herbert Simon labelled this process “satisficing” and concluded that human decision making could at best exhibit bounded rationality. Next Steps Read Chester Bernard, the Management Theorist Abraham Maslow’s Theory of Hierarchy of Need Theory X and Y – Douglas McGregor Chester Bernard, the Management Theorist Barnard's theory contains elements of both classical and neoclassical approaches. Bernards views contain many ideas that are consistent with rational system conception of organisations. What distinguishes them is his insistence on the nonmaterial, informal, interpersonal and indeed the moral basis of cooperation. Since there is no consensus among scholars, it might be most appropriate to think of Barnard as a transition theorist. He emphasised that organisations are essentially cooperative integrating the contributions of their individual participants. systems, Bernard defined formal organisation as that “kind of cooperation among men that is conscious, deliberate, and purposeful”. Two separate ideas can be deciphered from the above definition: 1. organisations rely on the willingness of participants to make contributions – a variety of incentives can be used to motivate them to make contributions including material rewards, opportunities for distinction, prestige, personal power – and make them in sufficient quantities or the organisation cannot survive. 2. whatever, the specific motive that procure cooperation in the enterprise, efforts must be directed towards a common purpose. the inculcation of belief in the real existence of a common purpose is an essential executive function Thus, Bernard attempt to combine two contradictory ideas. Goals are imposed from the top down while their attainment depends on willing compliance of from the bottom-up. He argued that it is fiction that authority comes from the above (failed instances of authority) This is because authority relies on the validation by those subject to it. This notwithstanding, some orders have greater potentiality of assent. Why? Because they are products of a well-designed and integrated communications system that links all contributions in a purposeful cooperative framework All communications relates to the formulation of purpose and the transmission of coordinating prescriptions for action and so rests upon the ability to communicate with those willing to cooperate. Thus, organisations are viewed as purposefully coordinated system of communications linking all participants in such a manner that the purposes of superordinates are accepted as the basis of action for sbordinates. With respect to informal organisations, he argued that formal organisations arise out of and are necessary to informal organisations; but when formal organisations come into operation, they create and require informal organisations. Informal structures facilitates communication, maintain cohesiveness and undergird the willingness to serve and the stability of objective authority. The critical ingredient to successful management is the creation of a common/collective purpose that becomes morally binding on participants. The inculcation of belief in the real existence of a common purpose is an essential executive function Abraham Maslow’s Theory of Hierarchy of Need What motivates human behavior? The Maslow's hierarchy of needs is one of the best-known theories of motivation. According to humanist psychologist Abraham Maslow, our actions are motivated in order to achieve certain needs. This hierarchy suggests that people are motivated to fulfill basic needs before moving on to other, more advanced needs. As a humanist, Maslow believed that people have an inborn desire to be self-actualized, that is, to be all they can be. In order to achieve these ultimate goals, however, a number of more basic needs must be met Maslow's hierarchy is most often displayed as a pyramid. The lowest levels of the pyramid are made up of the most basic needs, while the most complex needs are at the top of the pyramid. Physiological Needs: physiological needs are the needs for basic amenities of life. • Food • Water • Breathing Security and Safety Needs: These are the needs for protection from danger/risk • Financial security • Heath and wellness • Safety against accidents and injury Finding a job, obtaining health insurance and health care, contributing money to a savings account, and moving into a safer neighborhood are all examples of actions motivated by the security and safety needs. Social Needs: The social needs in Maslow’s hierarchy include • Friendships • Romantic attachments • Family • Social groups • Community groups • Churches and religious organizations Esteem Needs: Esteem needs are of two types: Internal esteem needs: self- respect, confidence, competence, achievement and freedom External esteem needs: recognition, power, status, attention and admiration. Self-Actualization Needs: According to Maslow’s definition of selfactualization: "It may be loosely described as the full use and exploitation of talents, capabilities, potentialities, etc. Such people seem to be fulfilling themselves and to be doing the best that they are capable of doing... They are people who have developed or are developing to the full stature of which they capable." Self-actualising people are Self-aware, concerned with personal growth, less concerned with the opinions of others, and interested fulfilling their potential. Implications of Maslow’s Hierarchy of Needs Theory for Managers As far as the physiological needs are concerned, the managers should give employees appropriate salaries to purchase the basic necessities of life. Breaks and eating opportunities should be given to employees. As far as the safety needs are concerned, the managers should provide the employees job security, safe and hygienic work environment, and retirement benefits so as to retain them. As far as social needs are concerned, the management should encourage teamwork and organize social events. As far as esteem needs are concerned, the managers can appreciate and reward employees on accomplishing and exceeding their targets. The management can give the deserved employee higher job rank / position in the organization. As far as self-actualization needs are concerned, the managers can give the employees challenging jobs in which the employees’ skills and competencies are fully utilized. Moreover, growth opportunities can be given to them so that they can reach the peak. Limitations of Maslow’s Theory It is essential to note that not all employees are governed by same set of needs. Different individuals may be driven by different needs at same point of time. It is always the most powerful unsatisfied need that motivates an individual. The theory is not empirically supported. The theory is not applicable in case of starving artist as even if the artist’s basic needs are not satisfied, he will still strive for recognition and achievement. Douglas McGregor (Theory X & Y) Human relations theorists have always emphasised the variability of individual characteristics and behaviours and have insisted on the relevance of these differences in understanding organisational behaviour. These theories have been codified by McGregor in his influential book, the Human Side of Enterprise (1960). He emphasised that most significant differences between classical (rational systems) management theory, which he labelled ‘Theory X’ and the human relations approach termed ‘Theory Y’. Principal Assumptions Underlying Theory X were: • Individuals dislike work and will seek to avoid it • Therefore, most people must be coerced, controlled, directed, threatened with punishment to get them to put forth adequate effort toward the achievement of individual objectives • The average human being prefers to be directed, wishes to avoid responsibility, has relatively little ambition, wants security above all. By contrast, human relations theory was constructed on the assumption that: • Most individuals do not inherently dislike work … the expenditure of physical and mental effort in work is as natural as natural as play or rest • External control and threat of punishment are not the only means for bringing about effort toward organisational objectives • The most significant rewards are those associated with the satisfaction of Ego and self –actualisation needs Midterm Exam Comments and Questions Thank you.
